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- By Owain Clarke
- BBC Wales health correspondent
Image source, Getty Images
Health boards have been hit by rising demand, inflation and the cost of covering for staff vacancies
The Welsh NHS may have overspent by more than £800m by the spring of 2024, according to BBC Wales analysis.
It comes all seven Welsh health boards, for the first time together, have been placed under higher levels of financial scrutiny.
“Difficult choices” would need to be made to tackle the “massive overspend”, Wales’ health minister warned.
But Eluned Morgan insists health boards should try to find cuts that cause “the least damage to patients”.
Ms Morgan previously warned that the NHS in its current form was “unsustainable”.
In a statement, she later pointed to “extreme financial challenges”, blaming UK government austerity and record inflation.
Rising inflation, dealing with the Covid backlog, an ageing population and covering for staff shortages were cited as the main reasons for the worsening financial situation.
“We do not make these decisions lightly and it reflects the very difficult financial position we are in, as a result of inflation and austerity, and the challenges affecting health boards,” she said.
“We are seeing operational pressures, long waiting lists, and an extremely challenging financial position in the NHS – but this is not unique to Wales.
“We will support health boards to improve their financial planning positions, but some difficult decisions will need to be made as we work through this very tough financial challenge.”
Darren Hughes, director of the Welsh NHS Confederation, said the service was facing the most difficult financial situation in its history, trying to deal with a “perfect storm” of increasing demand and soaring costs.
The body, which represents health boards, is one of 32 organisations calling for a “national public conversation” on the future of health and care services.
Official accounts by Audit Wales last week showed Wales’ seven main health boards recorded a collective deficit of £151.9m in the last financial year – 2022-23.
But back in the spring, health boards were already warning the Welsh government that their overspend this year would be much higher at about £650m.
Analysis by BBC Wales suggested unless big savings were found during the rest of this financial year, this could rise to £825m.
This will be the highest ever deficit recorded in the history of the Welsh NHS.
To put this number into perspective, it cost £358m to build The Grange, Wales’ newest hospital in Llanfrechfa, Cwmbran, Torfaen.
The Welsh government spends just over £10bn a year on health and social care.
The pay bill for the 94,000 staff who work in the Welsh NHS is about £4.5bn each year.
What is happening in each health board?
- Hywel Dda was initially planning for a £112.9m deficit for 2023-24 but it warned recently “there’s a risk that the health board will overspend by £145.4m” unless it could find £32.5m savings. It continues in enhanced levels of financial monitoring.
- Swansea Bay – initial deficit plan £86.6m, but latest health board papers warn it could be £35.9m higher – so £122.5m. It continues in enhanced levels of financial monitoring.
- Aneurin Bevan – it was initially planning for a £112.8m deficit, but needs to find £51.5m to achieve this and £30m of that was judged to be a red “stretch risk”. It is now under enhanced levels of financial monitoring after being previously under routine monitoring.
- Betsi Cadwaladr at an early stage said it was on track to keep to its initial deficit plan of £134.1m It remains in special measures – the highest level of monitoring
- Cwm Taf Morgannwg has an initial deficit plan of £79.6m but there were “significant risks” in finding £18.5m needed to achieve this although £4m has been found to offset this It remains under in targeted intervention- the second highest level of financial monitoring.
- Cardiff and Vale – initial deficit plan was £88.4m and says it has found 62% (£32m) of savings needed to achieve this but the deficit could rise if more savings are not identified. It continues in enhanced levels of financial monitoring.
- Powys normally breaks even but last year posted a £7m deficit. Its deficit this year was planned to be £33.5m and it needs to find £7.5m to achieve this. It is now under enhanced levels of financial monitoring after being previously under routine monitoring.
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