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Local health boards bailouts 'unsustainable' - Auditor General

Category: Wales

Published: 20th Jun 2012 06:55:07

A finance watchdog has warned that £24m in cash bailouts given to four Welsh local health boards (LHBs) are "unsustainable".

Aneurin Bevan, Cwm Taf, Cardiff and Vale and Powys Teaching boards received £24m in Welsh government loans in May.

Auditor general Huw Vaughan Thomas said that as a result the LHBs now faced larger deficits to make up this year.

The Welsh government has denied that the money amounted to a bailout and has ordered the LHBs to pay it back.

It has also said the boards face an inquiry into their savings plans.

The historical pattern of the Welsh government providing health boards with additional funding in year to manage deficits is not sustainable”

Mr Thomas said that without the emergency loans the boards in questions would have failed in their legal duty to break even at the end of the last financial year.

He also revealed the extent of the funding gap faced by each of the four boards in this financial year:

"The 2011-12 financial year presented every health board in Wales with significant financial challenges because of the downward pressure on funding and the continuing upward pressure on service demand," said Mr Thomas.

"In my view, the historical pattern of the Welsh government providing health boards with additional funding in year to manage deficits is not sustainable.

"That said, there are positive signs that the NHS in Wales is prepared to take the tough choices needed to deliver long-term change, although clearly it is a very challenging agenda."

Mr Thomas said he would be shortly publishing his Health Finances report, which would provide a more detailed assessment of the financial position across NHS bodies and the financial challenges that the NHS in Wales faces.

Source:
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BBC News, 2012. Local health boards bailouts 'unsustainable' - Auditor General [Online] (Updated 20th Jun 2012)
Available at: http://www.ukwirednews.com/news/1435717/Local-health-boards-bailouts-unsustainable-Auditor-General [Accessed 2nd Sep 2014]

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