HEALTH chiefs in Argyll and Bute have reduced their overspend – but the figure remains more than £1 million.
The area’s health and social care partnership (HSCP) has reported the figure as £1.1 million, compared to £1.4m two months ago.
An overspend of more than £750,000 is also forecast for the 2025/26 financial year, while officials work to manage the budget gap for future years.
The HSCP’s head of finance has warned that management of finance and spend in the coming year is “critical”, although he also recognised the “encouraging” reduction in overspend.
A report outlining the current financial position will go before the HSCP’s integration joint board at its meeting in Campbeltown on Wednesday, January 28.
Head of finance James Gow said: “There are uncertainties and risk associated with the forecast, particularly with high reliance on agency staffing which creates uncertainty and a lack of stability in costs. Additionally there are risks relating to service demand over winter.
“There are specific areas of concern and overspending highlighted in this report. The delivery of savings is improving and remains critical to financial performance.
“Continued engagement with both partners (NHS Highland and Argyll and Bute Council) is ongoing as the financial risk to them is higher than it has been in recent years due to the depletion of reserves.
“The forecast overspend can be funded by reserves, however, further deterioration is a financial risk to partners.
“It is the case that there has been some improvement over the last three months, the overspending is reducing and performance on delivery of savings has improved.
“There is, however, also some evidence that the actions are having an impact on service delivery, unmet need and delayed discharges.”
He added: “Management of finance and spend in the current year is critical as there is very limited financial flexibility remaining and even more severe challenges in 2026/27.
“It is encouraging that financial performance in the current year does appear to be improving, indicating that the measures taken are having some impact, although they are also having adverse impacts on service availability and delivery.
“Several areas of overspending have been identified in the current year. Both partners are aware of the current position and there are some general reserves remaining that may be required to balance an adverse variance.
“Actions are required to manage financial performance through the remainder of the year, the implementation of the threshold of care and further development of more sustainable staffing models are important.”
