Unpalatable decision having to be made, says health chief

A health boss has said Powys Teaching Health Board (PTHB) has already made unpalatable choices to bring down costs.

At a board meeting on Wednesday, members were given an update on the budget situation which sees it in talks with the Welsh Government over their deficit position.

The latest position the health board finds itself in is an expectation from the Welsh Government to find £35.6 million of cuts and savings this year on a budget of £462 million to keep its rolling budget deficit known as the control target to £15.8 million.

Chief executive Hayley Thomas explained that board members needed to agree the latest ask from the Welsh Government which is: “what would it take to deliver last year’s out turn of £15.8 million (deficit) and send that back to Welsh Government.”

Director of finance, Peter Hopgood said: “Further actions include an additional two per cent (savings) target across the board that could deliver a potential of up to £7 million.

“There’s been a lot of action and work in this area but there’s no confidence to deliver above £28.3 million.”

He explained that deliverable savings of £18.266 million could be made against a target of £23.1 million from a previous version of the plan.

The most controversial aspect of the plan is the decision that some Powys patients are intentionally made to wait longer for treatment in hospitals over the border in England than English patients.

This was agreed by the board in March when they set the annual plan by equalising waiting times for all Powys residents with Welsh Government waiting time targets.

The creation of this two-tier system for residents in some parts of the county is estimated to save £6 million within the overall plan.

Director of planning performance commissioning and commissioning, Nicola Johnson said: “The Wye Valley NHS Trust and Robert Jones & Agnes Hunt orthopaedic hospital (Gobowen) have operationalised the change for elective treatments from July 1, and we continue our discussions with them around out patients.

“Shrewsbury and Telford NHS Trust (SaTH) has not yet confirmed that the change to elective treatments and out patients became operationalised from July 1 and we continue our discussions with the provider.”

Ms Thomas added that meetings would take place with SaTH “chief executive to chief executive” next week and a further update would be brought to the board on the situation.

Independent board member Mick Giannasi said: “I’m very conscious that Welsh Government’s position in terms of achieving the £15.8 million control total was pretty unequivocal and even considering everything there’s still a shortfall.

“Are we starting to think through the unpalatable and where we go to next to close down that shortfall?”

Ms Thomas said: “In my opinion we are already transacting unpalatable options that are difficult to negotiate because of decisions we have already taken in March around commissioning.

“The longer we go into the financial year the reduced opportunity there is to further improve the situation.

She added that further “unpalatable options” including “external assessment” on potential opportunities would be brought back to the board once the work is finished.

PTHB chairman Dr Carl Cooper said: “We are absolutely committed to ensuring we are delivering the highest quality of services that are timely, financially sustainable and compassionate for the people of Powys and we do so as we navigate the tricky terrain of balancing the legal duties placed upon us.”

The board went on to agree the report.

In March when the board set the budget they expected the need to make  £11 million in cuts and savings during 2025/2026 which could potentially rise to £16 million.

This would keep the rolling budget deficit to £38.4 million.

This plan was rejected by the Welsh Government who called them “unsupportable and unacceptable.”

Revised plans put to the Welsh Government included re-setting the rolling deficit to £28.3 million which would need £23.1 million found from cuts and savings. 

By Elgan Hearn, Local Democracy Reporting Service