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NHS Orkney turns finances around after difficult months

The Balfour hospital in Kirkwall.
The Balfour hospital in Kirkwall.

NHS Orkney has found itself with a clean bill of health, financially speaking, as it plans to report to the Scottish Government that it has delivered on its three financial targets – after finding savings of £1.9million over the last year.

This comes after a difficult financial period for the board, which last autumn was warned that the Scottish Government would send in a recovery team if the situation didn’t get better.

Mark Doyle, the director of finance with NHS Orkney, delivered an update during a meeting of the health authority’s board.

He said they’re projecting a year-end estimate with a £91,000 underspend.

NHS Orkney finances in good health despite troubled months previous

He said, subject to a review and sign off by an external auditor, NHS Orkney will be reporting that it has delivered against the three targets:

  • Revenue resource limit (RLL), where it saw an underspend of £70,000
  • Capital resource limit, where it broke even, and;
  • A cash target, which was also met

Reporting to the NHS board, Mr Doyle said: “To allow us to deliver a small underspend against the RLL, the Scottish Government provided full funding for the Covid costs. They also provided funding for the unachieved savings.

“For 2021-22 we set a £5.5m savings target.

“In addition to that, the integration joint board brought forward an additional £800,000 of savings. For 2021-22 we delivered £1.9m of those savings.”

While the board was presented with a physical report up to February, Mr Doyle delivered a verbal update for figures up to March.

The report up to February put the board’s Covid costs at £4.28m, with unachieved savings sitting at £4.41m.

Mark Doyle added that this is a “really, really good news story because we’re in the midst of Covid and we still managed to get out £1.9m of both recurring and non-recurring savings”.

There were, however, areas of overspend.

Figures from the report up to February attribute these to pharmacy and drugs seeing a £454,000 overspend, estates seeing a £471,000 overspend, and hospital services seeing a £447,000 overspend.

Future of Old Balfour hospital to be decided once board is taken off emergency footing

During Thursday’s meeting, an update on some of the properties held by NHS Orkney was also given.

A surplus property in Hoy – named Bayview – sold for £145,000. It is also preparing to sell Greystones, in Evie.

The health board had also been expecting to sell another property on King Street in Kirkwall.

However, Mr Doyle said £128,000 has been set aside for the planning, change of use, and partial development of the King Street property.

The plan is to turn it into a number of flats for use by NHS Orkney itself.

The future of the Old Balfour Hospital, also in Kirkwall, is to be considered after the board is taken off “emergency footing”.

The old hospital has been used as a Covid testing center during the pandemic.

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