LISTEN: MSPs Slam NHS Highland For Budget Failures
Holyrood's Public Audit Committee blamed poor leadership and budget oversight for the health board needing a £2.5 million Scottish Government loan.
Poor leadership and complacency over budget management contributed to the financial difficulties at a health board which needed a Scottish Government loan to break even last year, MSPs have found.
NHS Highland was given an extra £2.5 million in 2013/14 despite a £5 million increase in its budget in 2012/13.
Holyrood's Public Audit Committee said it was clear that without this brokerage - which will be paid back over three years - there could have been serious repercussions for patients.
The committee heard from NHS Highland about the sequence of events that led to the request for extra funding for the first time in 11 years.
The most significant of these was overspending at Raigmore Hospital in Inverness.
Its overspend rose from £600,000 in 2010/11 to £9.6 million in 2013/14.
The committee said that the year-on-year overspend suggested a culture of complacency'' while they also found it was unclear as to how and why the decision to request brokerage was arrived at.
MFR News speaks with Committee convener Paul Martin...
Committee convener Paul Martin said: In 2013/14, for the first time in 11 years, NHS Highland requested a loan - brokerage - from the Scottish Government to enable it to break even against its revenue and capital budgets.
Given this, we expected to find a robust and transparent system of checks and balances that showed exactly how that situation had developed, and how and why the decision to request brokerage was arrived at.
"This was not the case.
Instead, the evidence from NHS Highland about when brokerage was agreed to and by whom was unclear and contradictory to an extent that we question how well-informed the board were and when they decided to seek brokerage.''
He added: The fact that, for example, Raigmore Hospital continued to overspend year on year, despite £5 million extra funding in 2012/13, suggests to us a culture of complacency about budgetary oversight at the hospital and at the NHS Highland board.
The slow progress in addressing the causes of the overspending at Raigmore was exacerbated by the practice of creating compensatory underspends elsewhere in NHS Highland in order to break even.
What was clear to the committee was that without brokerage there could have been serious repercussions for patients.
Whilst we acknowledge that NHS Highland has taken steps to improve its financial management and reporting to the NHS Highland board, it is essential for the future financial health of NHS Highland that all the actions and recommendations identified in the internal and external audit reports it has received to date are acted upon.''
NHS Highland chair Garry Coutts said: "We respect the role of the Public Audit Committee and accept the contents of its report on our financial management in 2013/14. "We welcomed the opportunity to give evidence to the committee and we believe we have fully co-operated. "We have already acted to address the concerns the committee has raised, both in its latest report and previously, and we are determined to ensure that our financial management and our governance practices are of the highest standards."