10 April 2006

HEALTH BOARDS TO RECEIVE SUBSTANTIAL INCREASE IN FUNDING IN BUDGET ALLOCATION

Northern Ireland's health boards are to receive a significant boost in funding, as a result of last December's increased budget.

Health Minister Shaun Woodward has announced that Health and Social Services Boards are getting £2.36 billion from the overall budget of £3.78 billion in the 2006/07 financial year. That is an increase of 8.2%, meaning £180 million more for the Boards this year, than what they received last year.

The Minister also highlighted plans to allocate funds more fairly to the frontline and the fact that Boards and Trusts are on course to break even.

Mr Woodward said: "This will help to put patients first. By increasing resources, in real terms to the front line, it will help reduce waiting lists, improve access to renal services, extend children's services and open a range of new and improved facilities."

The Minister also revealed that funding will be allocated more fairly in future, reflecting the need to target new resources towards those Boards where the population has been increasing most rapidly in recent years.

Mr Woodward said: "My decision today is not just about allocating more money, but also about allocating it more fairly. I have already made a major commitment to stripping funds away from bureaucracy and into doctors and nurses and other health professionals. But we want to match funding as fairly as possible to where people need our services. That is why we use a formula that takes account of population in the health board areas, by age, gender, level of deprivation and the proportion living in remote and rural areas.

"I am therefore going to share out an extra £10 million between the Southern, Western and Northern Boards in 2006/07 and an extra £12 million in 2007/08 to better align their resources with population need. In service terms this means extra investment in elderly care in the Northern Board, mental health in the Southern Board, and children's services and renal and critical care in the Western Board.

"Nor will this greater fairness impact disproportionately on the Eastern Board. The £10 million and £12 million for the Southern, Western and Northern Boards comes from additional resources and adjustments will simply bring funding more into line with the needs of this population relative to populations elsewhere in Northern Ireland. The Eastern Board still stands to receive a funding increase of over 7%."

Commenting on the additional funding, the Minister said: "There are many areas in which these funds will make a crucial difference. We will improve key children's services, particularly in foster care. We will modernise children's homes and support children as they leave care.

"Over the next two years, Province-wide improvements will be made in key regional services, particularly in cardiac surgery, renal and cancer services and in service developments such as expansion of the renal unit at the Ulster Hospital, a new Breast Screening Centre at the City Hospital and implementing new digital technology across all our X-ray departments."

Specific funding next year will see:

• £12 million for reform of elective care;,
• £10 million to better align resources with population need;
• £4 million to improve Foster Care provision;
• £2 million for child protection;
• £2 million for Children's residential care;
• £0.5 million for Children leaving care;
• £1.5 million for Renal services; and,
• £2 million in support of a range of capital projects planned to open in 2006-07.

"These specific resources for new developments are on top of £23.5 million provided to meet the 2006-07 costs of HPSS pay modernisation and almost £12 million to run new facilities, such as the cancer centre."

In conclusion, the Minister praised the strong financial performance of Health and Social Services Trusts over the past number of years.

"Despite the serious pressures facing the health service, Boards and Trusts have maintained financial stability over the past four years and are set to achieve break even again this year. They deserve a lot of credit for this. It is important, though, that the health service makes the most effective use of its resources. The review of public administration gives us a further platform to do that."

NOTES TO EDITORS:

For further information, please contact Philip Maguire DHSSPS Information Office on 028 9052 0636.

1. A breakdown of each Health Board's allocation is as follows:

	Overall Allocation 2006-07	Increase in Overall Budget
Health Board	£m	%
Eastern	£960.97	5.9%
Northern	£559.63	7.6%
Southern	£424.46	7.9%
Western	£394.13	7.5%
Unallocated	£26.7	N/A
TOTAL	£2,365.90	8.2%

2. £26.7 million of funding has yet to be finally allocated to individual Boards but has been included in the overall total resources made available to the HPSS. This includes resources set aside to improve waiting times, modernise junior doctor provision and the staffing costs of new projects planned for 2006-07.

3. The Capitation Formula is used to set the target shares for each HSS Board's allocation. It is an evidence-based, sophisticated, statistical model which takes account of population size and age/gender profile, additional needs related to e.g. deprivation and unavoidable costs such as those involved in delivering community services in a rural setting.

4. The Minister then decides on how quickly HSS Boards can be moved towards their target fair shares depending on the size of the equity gap, how it is likely to change in the coming years and the need to maintain existing services in all four HSS Boards. The extra £10 million in 2006/07 and £12 million in 2007/08 for the Northern, Western and Southern Boards will reduce the equity gap and will be funded from additional resources provided from the centre.

5. The revenue allocations to Health Boards provide funding for the 'commissioning' of a comprehensive range of care services on behalf of the community. Boards commission contracts for care services with:

a. The 19 Health and Social Services Trusts;

b. A wide range of Voluntary Organisations;

c. Organisations in the independent sector.

6. Where HPSS organisations forecast a potential overspend, the Department requires corrective measures to be instigated to ensure financial break-even. If warranted, Boards and Trusts are required to produce financial recovery and contingency plans, subject to Ministerial approval.

7. During 2005-06, 10 of the 19 Trusts secured Ministerial approval for contingency plans to avert a potential overspend of some £20 million. Those responsible for spending public money carry particular responsibilities to the taxpayer and to Parliament. Parliament sets the budget for every department and it requires recipients of that money to deliver their functions without exceeding those budgetary limits.

8. These controls have ensured that, since 2001/02, all HPSS organisations have fulfilled their break-even duty. Based on the latest financial information submitted to the Department, and unlike the NHS in England, HPSS organisations are now on course to do so again in 2005-06.

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