NHS in Wales faces £380m cutbacks

The Welsh NHS faces making more than £380m worth of cutbacks by next April, with managers saying it is the biggest challenge they have faced in 20 years.

BBC Wales research shows savings targets have been imposed on staff pay and changes made to hospital services to reduce costs this financial year.

More cuts may be necessary depending on the outcome of the UK Government's public spending review in October.

The assembly government said the review was "profoundly important for Wales".

The Conservatives said the cutbacks were based on funding to the assembly government by the previous Labour government in Westminster.

Some health boards predict fundamental changes to reduce costs.

Some have already imposed "rigorous vacancy controls" and said there would be "fundamental service reconfiguration" in years to come.

One health board document warns that "tension will increase" between what patients will expect and what the NHS can provide.

The largest health organisation in Wales, Betsi Cadwaladr University Health Board has an annual budget of over one billion pounds, but faces a savings target of more than £70m in 2010-11.

"I wouldn't pretend that its easy, but there are opportunities." says vice-chair Dr Lyndon Miles.

"We are looking at lots of areas - we are looking at the way we spend at the moment, for example employing locums and agency staff and the way we recruit."

Reforming the workforce and reducing the wage bill is a common theme across the seven health boards and three NHS trusts - with Betsi Cadwaladr UHB hoping to save £14m in 2010-11.

The health board has already introduced changes to its services, such as the plan to close HM Stanley hospital in St Asaph, Denbighshire, with more services being moved into the community.

"It is a challenge. A lot of people are working hard to meet the challenge. It is clear that we can't stay as we are - we do need to change," admits Dr Miles.

The Welsh Assembly Government said the outcome of the spending review in October "will be profoundly important for Wales - and undoubtedly the most important since devolution".

In terms of the likely future impact on the Welsh NHS, it says it is "continuing to consult closely, openly and seriously with front-line workers and engaging with communities the length and breadth of Wales to ensure we work together to protect essential public services."

Welsh Conservative health spokesman Andrew RT Davies, said: "These spending cuts are Labour's cuts, to be implemented in this financial year.

"They are based on funding to the assembly by the previous Labour Government in Westminster and implemented by the current Labour-Plaid Assembly Government."

He challenged the Welsh health minister to investigate reports as much as 20% of the Welsh health budget "was being wasted every year".