NHS Lothian 'underfunded by £365 million' because of funding formula

STRUGGLING NHS Lothian has been underfunded by more than £365 million over the past 11 years, according to new figures.

Tuesday, 29th October 2019, 6:00 am
Updated Tuesday, 29th October 2019, 9:06 am
NHS Lothian is projected to have a 90m deficit by 2020/21

Lothian MSP and Tory health spokesman Miles Briggs called for a review of the funding formula to stop Lothian being put at a disadvantage.

His comments come after an Audit Scotland report last week showed NHS Lothian is predicting a deficit of £90m by 2020/21.

Mr Briggs said the deficit - almost half of the total £207m forecast across all Scottish health boards - was an accumulation of underfunding for NHS Lothian since 2009/10.

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Miles Briggs says NHS Lothian will have to be bailed out by the Scottish Government

He said: “That £90m is an insurmountable amount of money for an already overstretched health board to make up and could seriously impact on services.

“It looks likely that the Scottish Government will again have to bail out NHS Lothian to get them back to a level playing field.

“The formula for funding each health board must be reviewed so that we are not in the same position in a few years’ time.

“It is patients in the Lothians who are suffering due to the disadvantage NHS Lothian has been put at by SNP ministers, as well as their mismanagement of tax payers money.”

The NHS Scotland Resource Allocation Committee (NRAC) formula was introduced in 2009/10 and allocates money to health boards based on the age and sex distribution of the population in each area, geographic factors and other health indicators.

But because of large differences between the new allocations and the previous amounts boards had received the NRAC formula is still being phased in.

The new figures, from the Scottish Parliament Information Centre (Spice), show the gap between the amount NHS Lothian should receive under the NRAC formula and their actual allocation started at £64.2m in 2009/10, rose to £68.7m the following year and, with some fluctuations, was reduced to £11.6m in 2019/20. The accumulated total was £365.7m.

Mr Briggs said: “Both Grampian and Lothian continue to be below parity.”

He recalled Health Secretary Jeane Freeman had said in January she was “open to discussion” on reform of the funding formula, but nothing had changed.

“Given what we now know with the Sick Kids and budgetary pressures, it will be interesting whether she will look at that again.

“It’s now inevitable that health boards like Lothian will need to be bailed out at some point because unless they are going to make severe cuts top services where is this funding going to be bridged?

“They’re not going to find this money down the back if the sofa. Health boards have already been forced to make huge savings in the past. On the one hand they have been under-funded and on the other they’re in one of the worst financial situations.”

He said Health Secretary Jeane Freeman had in the past written off the debts of other health boards. “Given the pressures we’ve got in Lothian, we are probably in a place where they are going to have to write off some of this debt.”

A Scottish Government spokesperson said: “Recent decisions by the UK Government have short-changed Scotland’s NHS by more than £90 million. Despite this, the Scottish Government is investing record levels in excess of £14 billion in our NHS and we will continue to protect our frontline services.

“This year, NHS Lothian’s budget has increased by 3.1 per cent, with the board’s funding now at a record high in excess of £1.4 billion.

“NHS Lothian are developing and delivering savings plans and are working to break even over the current three-year planning cycle.”