Isle of Man health service predicts £27m overspend as costs soar

Teresa Cope said steps were being taken to lower the forecast overspend

A £27.2m overspend has been forecast in the health service due to increases in staff pay, rising costs and a continued budget deficit, Manx Care has said.

Concerns about the shortfall for the 2023-24 financial year have been raised in a report put before Manx Care's board this month.

But chief executive Teresa Cope said the figure was a "worst case scenario".

Action continued to be taken to bring some areas of spending "back under control", she said.

An increase in "tertiary care" for patients, which is treatment in UK hospitals, and "quite a dramatic increase" in drugs costs caused by rises in inflation were among the reasons for the overspend, she said.

However, Ms Cope said a "wide range of options" were being considered to reign in spending and more information would be provided at the board's October meeting.

'Complicated'

Manx Care was given a budget of £303m for the current financial year, but Ms Cope said the health provider had previously told the government it would need £330m.

The body was created in 2021 to take over from the Department of Health and Social Care (DHSC) as an arms-length provider of health services partly with the aim of bringing down costs after a series of overspends.

Manx Care expects the £27.2m overspend to come down to £22.2m with the approval of £4.9m funding from the DHSC's reserve fund.

The health provider said £7m of the shortfall would be needed to cover a 6% pay award for staff, which was 4% more than the fund allocated to it by the government to cover wage rises.

Ms Cope said around £15m was an "operational overspend", an area where she said Manx Care "can and should start to take action to bring back under control".

The financial situation was "really complicated" because £9m of that was a deficit carried through from the last financial year.

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