Local Health Boards Face Cash Crisis Over £10 Million Shortfall in Funding

12.00.00am GMT Tue 26th Feb 2008

Local Health Boards in Gwent face a serious cash crisis in the region of £10 million as the Assembly Government backtracked on a promise of extra funding, claims a leading member of the National Assembly for Wales.

Michael German, leader of the Welsh Liberal Democrats, was speaking after it has emerged from meetings with local health boards in Gwent that they won't be able to balance their books this financial year. He raised the issue at First Minister's Questions today.

Speaking in the chamber Mr German said: "In Newport, Torfaen, Caerphilly and Blaenau Gwent, there will be a £10m deficit as a result of the Grogan Ruling. They were promised by the Welsh Assembly Government they would not have to meet these costs this year. Then eight or nine weeks ago, they were told it would not be met.

"Each LHB chair has told me that the Grogan settlement is costing them more money."

Rhodri Morgan said he believed that the appropriate changes in local authority and local health board budgets had been made.

Speaking this afternoon Mr. German added: "The root cause of the problem is the Plaid-Labour Assembly Government's failure to deliver the extra cash to Local Health Boards to fund their new responsibility of funding social care. LHBs warned there would be problems, but the government has failed to listen. Here we are almost a year later with a cash crisis and possible cuts in local health provision to fund the new social care functions.

"With Local Health Boards in Gwent alone facing deficits of about £10 million - and national estimates as high as £100m - this can only have a major impact of the rest of the NHS in the next financial year. It's a real mess and one that was easily avoided."

Residential and social care costs used to be funded by local councils, until the Grogan ruling where the each of Wales' Local Health Boards fund social care for patients rather then local council social services budgets.

NOTES

Nodiadau

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[1] "A further significant risk will be the Continuing Care "Grogan" Ruling relating to statutory responsibilities between Social Services and care provided by the NHS. The financial implications for this have not been reflected in the financial information within the documents.

The Chairman confirmed this issue has been raised with the Minister for Health and Social Services by the Chairman of the Wales LHB's. The Minister had asked the Welsh Office Research and Development Department to make a report on the findings of the "Grogan" Judgement which will be available in July 2007."