NHS Shetland faces ‘significant changes’ to deal with public spending squeeze – chairman

NHS Shetland chairman Ian Kinniburgh believes there will have to be “significant changes” to the way the health authority operates to help it cope with the squeeze on public finances over the next five years.

Having found £1.5 million-worth of savings in 2009/10, NHS Shetland is now faced with trimming a further £1.4 million from its annual £45 million budget in the current financial year, the equivalent of three per cent of spending.

While the cuts it has to find may not be quite of the same magnitude as those faced by Shetland Islands Council, Mr Kinniburgh said the organisation was facing “not a particularly pleasant” task. He believes that while this year’s cuts are manageable without damaging the standard of healthcare being provided, it will become “increasingly difficult” in future years.

“We’re talking about probably four years, possibly five years of reducing expenditure to the public sector,” he said. “In real terms with escalation in costs, set against even a relatively small set of changes in budget, it is going to become increasingly difficult.

“It could be another 15 years until we get to a comparable level of spend [to last year]. We need to set that against how we can carry on delivering high quality services by being smarter with technology, spending our money very much on delivering services.

“If we don’t need to fly people up and down [to the mainland] then that type of thing would be the sort of areas where we hope to yield some savings.”

Just over half of the NHS Shetland budget goes on staffing costs within what is the second-biggest employer in the isles after the SIC, though the wage bill forms a much lower proportion of spending than the council’s due to the higher cost of equipment and resources.

Scottish government policy explicitly states that there will be no compulsory redundancies within the NHS north of the border as funding cuts begin to bite, but NHS Shetland will be losing eight members of staff in total on an “opportunistic” basis as people leave or retire.

It is responsible for directly employing 598 staff, or a full-time equivalent of just below 500, which costs around £23 million.

In addition there are 96 staff employed by Sodexo, which provides cleaning, catering and other services to the authority, as well as several independent GP practices.

Information provided to The Shetland Times by NHS Shetland shows that 11 clinicians and two other members of staff earned in excess of £100,000 a year in 2009/10. Two clinicians earned between £150,000 and £160,000. The pay of NHS staff is subject to national negotiations, but chief executive Sandra Laurenson said it was probable that salaries would have to be looked at. “I think it’s likely that all pay will be under review in the coming months and years,” she said.

Mr Kinniburgh said there had been a “very clear message” from Holyrood that no-one will be forced out of work. “Whether circum­stances change I don’t know but … so far the staff have been absolutely tremendous in recognising the kind of problems we have and wanting to work with us in trying to sort that out.”

The health authority is working towards producing a new clinical strategy later this year aimed at equipping it to tackle cutbacks over a number of years rather than having to react abruptly to further reductions in central government grants each year.

“There will be significant changes in the way we do some of our business, but what we’ll be aiming to do is make sure that patients can receive the full range of services that they currently receive,” said Mr Kinniburgh.

Having managed to break even last year through a package of savings including, among other things, using more non-branded prescription drugs and examining activities shared with NHS Grampian, NHS Shetland is confident it has a workable plan to repeat the exercise this year.

Finance director Nick Kenton stressed that savings were not being imposed in a “blanket” way, but in partnership between senior management and staff representatives. He praised staff for their resolve in the face of the “very difficult financial climate”.

He said: “We have an idea of our allocation for 2010/11 but no further forward. We’re about to enter a new period of a comprehensive spending review, so that will affect what might be available. Each year it becomes more difficult to find savings.”

Mrs Laurenson hopes more money can be saved in prescription costs as well as cutting the waste of medicines, looking at procurement and using national NHS contracts where possible, as well as tweaking services such as clinical governance and psychology and saving overheads and staff costs at the Montfield unit for elderly people, which is currently empty.

“Although we’re not planning to consult on formally closing the unit until our clinical strategy reports, we are going to make savings in that area, some of it through jobs, some through cleaning, catering, heating, because we don’t have patients.

“We’re going to have another go at getting yet more savings out of prescribing. Clearly that’s an area that doesn’t impact directly on patients, if you have a generic drug as opposed to a brand drug, and we now have the highest generic prescribing rate in Scotland.”

NHS Shetland is also seeking to generate extra income through its occupational health service, which provides services to other bodies.

Mrs Laurenson continued: “There’s some more modest savings across a range of departments, reducing our utilities bills by being greener, using more low-energy light bulbs; we’re also in the process now of seriously cutting back staff travel.”

She acknowledged that there remain a large number of people on the waiting list for dental checkups, but is hopeful that a new practice can be opened in Lerwick within the next year. A full business case should come before the board in September and she said different possible locations were still being looked at.

“We anticipate that provided we’re able to recruit sufficient dentists, that will resolve the dental waiting list,” she said. “Although the waiting list is longer than we would like, the difference in Shetland is that we don’t have much private dental services, and we are able to offer emergency care to folk; nevertheless we recognise that something has to be done and actions are being taken.”


Add Your Comment
  • Ali Inkster

    • July 15th, 2010 20:36

    The drugs project would be a good start. Why in god’s name are they handing out methadone to help the junkies through times of short supply on the island? Surely if someone wants to get off opiates the best way is not giving them a substitute that does damn all to deal with their addiction. Before that damn place opened its doors there was very little heroin abuse on the island for the simple reason that supplies were not and can never be constant on the island. But as soon as they started dolling out free meth to anyone that walked through the door then no-one had to go cold turkey anymore and heroin use up here exploded. 660 registered addicts and at least 2 more for every 1 registered. But then if you want a job for life on good pay then become a drugs councillor that supplies the drugs to keep them junkies addicted.
    And why are they handing out needles by the barrow load so the junkies don’t get infected by using dirty needles, or is it so they can share them among their friends and up the stakes on every one of them’s habit and therefore perpetuating and spreading the addiction.
    Thje drugs project is a cancer we can not afford and the sooner it is cut out the better for every one in Shetland.

  • Neil Wishart

    • July 15th, 2010 22:35

    If this year’s NHS budget for Shetland is £45 million, how much is that per head living in Shetland?

  • Steve Jack

    • July 16th, 2010 15:52

    Well, based on a 22,000 population Neil, a little over £2,000 per head – similar to the cost of a family health insurance policy in the US but comprehensive for all regardless of age or health condition and with no deductibles, coinsurance, and copayments etc (comparison made using http://www.ahipresearch.org/pdfs/2009IndividualMarketSurveyFinalReport.pdf)

  • Neil Wishart

    • July 16th, 2010 21:46

    Thank you Steve – that makes Shetland Healthcare very expensive? Two thousand pounds per head when that would cover a whole family with private healthcare in the US – savings must have to be made!

  • paul barlow

    • July 28th, 2010 17:07

    we have 3 wards under staffed were would you like the cuts. maybe we should cut the medical or surgical wards shear luxury. maybe get rid of the doctors and the denists. who needs them. a good saving would be if the nhs did not have to pay vat on its purchases. saving 20% would be a very good saving. after all your just paying the tax man to return the money.

  • Neil Wishart

    • August 1st, 2010 21:33

    Welcome to the real world – try and get a service like we do in Shetland in England………dream on!


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