Northern Ireland health services face funding gap

A briefing given to party health spokespeople on Wednesday said the Department of Health expected to need £7.86bn to cover costs in 2023/24. This allows for price inflation, demand growth and new drugs as well as assuming a 3.5% increase in pay costs. However, this compares with expected best case funding of £7.31bn – the same amount the Department received in the current year – leaving a £551m gap.

Some £254m of this could be offset with further savings and efficiencies, with the remaining £300m gap equating to 4% of the overall spending requirement.

The briefing added that, in the absence of significant additional funding, the health and social care sector ‘will be required to make high impact cuts that will be counter-strategic to long-term service sustainability’.

The identified savings fall into those that would have a lower and medium impact on services. Lower impact savings include an increased push to reduce the use of contract agency staff, along with improvements in procurement and pharmaceutical efficiency. Covid costs are also expected to fall and some reductions have been identified in health promotion and fire prevention campaigns.

However other savings could have a bigger impact, including reductions in critical shift payments and cuts in agency and locum costs to a level affecting service delivery. Speed of NHS recovery could also be hit, with the briefing suggesting that waiting list initiatives could be reduced across specialities such as orthopaedics and ophthalmology. Capacity may also have to be reduced for a range of demand-led services.

A number of possible cuts were identified for closing the remaining gap, including a reduction in payments for support services provided by the community and voluntary sector and a reduction in education and training places. Savings could also be made by reducing in-house elective work, further extending waiting lists. The Department is also looking at ways it could increase income, for example by continuing full cost recovery for car parking and through prescription charges and charging for domiciliary care.

With health currently taking around 50% of Northern Ireland’s budget, the briefing said it was hard to provide protection without significant impacts on other departments. In the absence of a devolved executive, responsibility for setting the 2023/24 Stormont budget rests with Northern Ireland secretary Chris Heaton-Harris.