Health Secretary Nicola Sturgeon has admitted for the first time that the NHS in Scotland is facing spending cuts next year.
Her comments in an interview with The Herald, in which she acknowledges the health service will need a real-terms budget cut, marks a significant change from repeated assurances that it will be ring-fenced against the massive squeeze on public-sector funding about to be announced at Westminster and Holyrood.
Ms Sturgeon now talks of efficiency savings and cutting spending in health bodies that do not treat patients, such as training arm NHS Education Scotland – allocated £399 million this year – and health promotion wing NHS Health Scotland, which received £21m.
She also said it was unlikely NHS Scotland’s capital budget would be protected, predicting a drop of about 20%.
The Deputy First Minister’s previous determination to protect the £11bn annual health budget – potentially at the expense of other services such as council funding and free care for the elderly – has been criticised by political opponents.
However, less than two weeks before George Osborne unveils his cuts package, Ms Sturgeon told The Herald that, while the Scottish Government would endorse the Chancellor’s promise of some increases for health, “it does not mean the NHS has a free pass from the difficulties everyone else is facing”.
Ministers are standing by their pledge to pass on any increase in the health budget expected from Westminster, known as Barnett consequentials. However, Ms Sturgeon cited a landmark report by former NatWest chief executive Sir Derek Wanless on NHS funding, saying: “The Wanless Report puts health service inflation at about 4% – just the cost of standing still.
“Whatever the Barnett consequentials turn out to be, I am totally certain they will not amount to 4%. There is going to be a gap between what we are able to do for the health service and that 4%, which the health service will have to fill with efficiency savings. It is not going to be easy for the health service.”
The soaring bill for prescription drugs as more people need long-term medication and new treatments become available is one of the main pressures on health boards. Looking after the growing number of elderly people is another.
Of the training and health promotion agencies, Ms Sturgeon said: “Looking at how we approach these other, different parts of the service is very much on the agenda.”
She also gave tentative support to health boards and councils merging back-office functions, such as human resources, although she stressed the importance of these departments in delivering frontline services.
Cutting the total number of health boards, however, does not seem to appeal. Ms Sturgeon said large-scale structural changes did not necessarily deliver the savings expected and questioned if it would justify diverting staff from their core jobs.
Instead, she said: “One of the areas of integration I think there will be more focus on is not necessarily between different parts of the health service, but different parts of government in terms of health and social care.”
Health boards have already announced plans to axe around 4000 jobs this year, including more than 1500 nursing and midwifery posts.
Ms Sturgeon set up a national group including unions to screen the way staffing changes would affect patient care, but says treating more people as day cases means some hospitals need fewer nursing staff.
“There is an awful lot of good work going on around efficiency and productivity in the health service that makes me confident the health service will be able to live within its means and be able to provide good quality,” she said.
Capital projects such as the new Southern General Hospital campus in Glasgow, a new emergency care centre in Aberdeen, and a new children’s hospital for Edinburgh are firm commitments, according to Ms Sturgeon.
But given such demands, “the pressure on the capital budget is significant”. Health boards have already been rethinking their plans.
Dr Brian Keighley, chairman of the British Medical Association in Scotland, said: “I am pleased that there is a growing recognition among politicians that health inflation will place additional pressures on the NHS.
“As we approach the Scottish Parliament elections, politicians and the public need to go into the debate on health with their eyes open.”
NHS in Scotland faces spending cuts next year.
Herald Scotland