HEALTH officials in Argyll and Bute may have to use most of their reserves to help balance the budget in the coming financial year.
An officer has also reported that the area’s health and social care partnership (HSCP) is awaiting confirmation on its service level agreement with NHS Greater Glasgow and Clyde (NHSGGC).
The HSCP has launched a consultation with the public as it prepares to set its budget in March, with a range of savings options already proposed.
James Gow, the HSCP’s head of finance, gave his report at a meeting of its integration joint board on Wednesday, January 28.
He said: “At the time we set our budget, we had around £7.5 million of non-recurring resources to prop up the budget, which is not sustainable.
“So while the performance is good, we have to bear in mind that our budget relied on those resources.
“I would also highlight our position is subject to greater charges from NHSGGC. We are not in a position to confirm these at the moment but are receiving appropriate support in taking this forward.
“In terms of our social work budget provided by the council, there were two years of temporary savings on the cost of employer pension contributions. As we move into 2026/27, these pensions return to normal.
“The risk was using reserves within the health and social work balance sheet to enable us to continue services beyond the level that we are resourced on. Once it is spent, it is gone.
“They will be largely depleted by the end of the current year, and we expect to have a little left, about £300,000 to £500,000, and with the scale of the budget gap, we would be allocating whatever reserves we have to help manage our financial position this year.”
Turning to the service level agreement, Mr Gow added: “It is a huge amount of our acute strategical provision and it is a really complex agreement that provides pathways for a chunk of acute care.
“It has not been updated for a number of years since pre-Covid in terms of the cost and volume of activity.
“NHSGGC has worked through a process over the last year to evaluate costs, and clearly there is now a mismatch between what they see as the cost of that care, and what we have budgeted for. We are in the process of better understanding that.
“We are all aware that costs have risen in the past four or five years, but we need to give ourselves assurance that they are treating us fairly within their model.
“They can charge us extra and we are discussing with NHS Highland and the Scottish Government what that means for us.
“It is a complex picture and we probably need a bit more time to do a fuller analysis.”
NHSGGC has been contacted for comment.
