POWYS Teaching Health Board has set a deficit budget of just under £25 million for the 2024/2025 financial year – more than double its forecast for the current year.
The health board is predicting a £12 million, but is planning for that to soar as part of its overall £421 million budget for the next year.
The county's ageing population – which could see a third of Powys residents being aged over 65 in 2034 and which could add to stress on the NHS – is considered one of the key reasons.
At a board meeting on Wednesday, March 20 members were told of the grim financial outlook while discussing their new five-year integrated plan.
PTHB director of finance Pete Hopgood said: “There’s a significant financial challenge and we’re unable to deliver a balanced plan to meet the three-year break even statutory duty.”
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He explained that a lot of time had been spent scrutinising the economic assumptions around inflation, growth of the economy and the board's ability to lessen the financial pressure and deliver savings.
Mr Hopgood said: “Our plan has a deficit of £24.95 million and we have a savings target of £7.9 million.”
He believed that the board would need to look at improving the financial situation during the year by finding further “savings opportunities.”
Board member Mick Gianassi asked what the implications of the deficit would be for PTHB.
Mr Hopgood: “As a health board we cannot borrow, and we do not hold reserves.”
He explained that if the plan is agreed “strategic cash support” will be received from the Welsh Government and would cover the eventuality that PTHB’s outgoings will exceed its incomings.
Newly appointed chief executive Hayley Thomas explained that PTHB already receives “enhanced monitoring” from the Welsh Government on finance and planning.
Ms Thomas said “There could be a scenario where we will face escalation as a result of this plan, and we need to be prepared for that eventuality.
“I’m not afraid of increased escalation because it comes with further scrutiny and support.”
She added that it would show the government that PTHB is “doing all we can”.
Ms Thomas said that the level of savings in this plan is “substantial” and that it needs to “feel achievable” from the perspective of front line staff.
Board member Ronnie Alexander said: “This is our best offer, and we need to be open and honest about that and to me it satisfies the public duty.
“It’s better to do that than submit something that’s not based on practical reality.”
He believed it would be important next year to show “sustained progress” on achieving improvements.
The board unanimously approved the plan which now be submitted to the Welsh Government.
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