2014/15 FINANCIAL OUTLOOK AND CHALLENGES

1. 2014/15 FINANCIAL OUTLOOK AND CHALLENGES

2. Overview • Financial Context • Summary of 2014/15 position: • Key pressures/service developments • Savings opportunities • 2015/16 and future outlook • Implications for 2014/15 and Choices

3. Scale of Financial Challenge in 2014/15 Additional funding of £420m needed to meet all identified costs of meeting existing policies and expectations Savings of £170m have been identified by DHSSPS DHSSPS budget due to increase by £90m A funding gap of £160m still needs to be resolved

4. DHSSPS Budget 2010 Profile

5. Efficiencies Already Delivered

6. Efficiency Indicator Trends

7. Opening position for 2014/15 Significant unresolved challenges experienced in 2013/14 The HSC is carrying deficits of £115m into 2014/15 • Reliance on non-recurrent measures in 2013/14: • In Year Monitoring • Managed slippage/deferral of expenditure

8. Latest Assessment of 2014/15

9. Key Pressures in 2014/15 Pay & non-pay inflation £52m NICE Drugs £19m Demography £35m MH and LD Resettlement £17m Service Developments £76m Specialist Hospital Services £7m Family Health Services £37m Transforming Your Care £21m Public Health Agency £4m Revenue Costs of Capital £7m

10. Service Developments in 2014/15 Psychological Therapies £2.5m NICE Drugs £19m Cath labs £4.5m Elective Care £15m ED Capacity Planning £5m Normative Nursing £12m Family and Child Care £7m

11. Savings Opportunities 2014/15

12. Savings Opportunities at Trusts – 2014/15 • ACUTE • REFORM • Reduce Excess Bed Days • Increase in day case rates • Reduce Did Not Attends • Improve theatre utilisation • Reduce level of cancellations • SOCIAL CARE REFORM • Reablement • Shift to lower cost provision • Reform of Social Care • STAFF PRODUCTIVITY • Review of skill mix • Reduction in backfill (whilst maintaining safe staffing levels) • Reduce sickness absence • Unit cost management • OTHER PRODUCTIVITY • Rationalisation of the estate • Procurement • Management costs/shared services

13. 2015/16 Outlook • Total additional pressures are estimated at £317m • There is a growing trend of cost pressures:

14. Population The 2011 Census, indicates that 20% of the resident population were aged 60+. By 2021 it is projected that this will increase to 23.2% and by 2051 almost one third (32.6%) of the population will be aged 60+. Between 2011 and 2051, the proportion of the population aged 85+ is expected to increase from 1.7% to 6.7% .

15. Unplanned Admissions to HSC Hospitals in Northern Ireland with a Long Term Condition for those aged 65 and Over by HSC Trust, 2010/11 By 2020: Number of adults with LTC will increase 40% in RoI, 30% in Northern Ireland 80% of GP consultations & 60% of hospital bed days relate to LTC and complications.* * Source: Making Chronic Conditions Count IPHI

16. Key Reform Initiatives Under TYC Shifting 5% of hospital expenditure with reinvestment in primary, community and social care services Improving integration of care through the development of integrated care partnerships – reducing need for unnecessary hospital visits Maximising the potential of technology Building a model of care which is focused on the individual rather than the institutions

17. Impact of budget allocation – 2014/15 • Deterioration in waiting times for elective services – which would exacerbate the health inequalities we are committed to addressing • Compromising the safety and quality of services provided to patients and clients • Compromising the delivery of statutory requirements, Programme of Government commitments and key Ministerial priorities and commitments • A growing parity gap between Northern Ireland and the rest of the UK by not funding all demand led pressures

18. Choices For Executive 1 Increase even further the extent of savings required across the HSC 2 Constraining pay for HSC staff 3 Reducing the range and/or standard of services offered 4 Impose additional charges or co-payments for services 5 Provide additional recurrent resources to DHSSPS