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DHSS to seek £6.5m supplementary vote 18 January 2006

    The Department of Health and Social Security is to seek approval at the January sitting of Tynwald for additional spending of £6.5m to help meet rising costs and demands affecting its services.

    The sum relates to costs and demands in health services and social services that have increased beyond the provision of the Department’s approved £189.5m budget for the current 2005/06 financial year.

    Minister Steve Rodan MHK explained:

    ‘The Department of Health and Social Security is a large organisation, with more than 3,000 staff, providing a wide range of important services to the public of the Isle of Man. Most of these services are delivered in response to demand, which is difficult to predict exactly but impossible to refuse. For example, if Nobles Hospital faces increased demand for clinical services, or Social Services is required to help more vulnerable individuals, the Department cannot simply call a halt.’

    Mr Rodan added:

    ‘In addition the Department is affected by rising costs outside our control, which, given the scale of our operations, can be significant. For example, our energy costs this year are £1m more than budgeted for.’

    In the last two financial years, 2003/04 and 2004/05, the Department has exceeded its annual budgetary allowance by £1.7m and £4.8m respectively. Supplementary Votes have been approved by Tynwald to address these overspends.

    Based upon current trends, it is projected that the net overspend for 2005/06 will exceed budget by £8.0m (or 4.25 % over budget). The principal areas of overspends are:-

    Primary Healthcare

    • Pharmaceutical services by £1.5m


    • Clinical equipment and supplies by £2.0m
    • Staff costs, Bank and agency staff by £1.1m

    Social Services

    • Children and Families by £1.3m
    • Adult Services by £1.1m


    • Estates – Fuel (energy) costs by £1.0m

    Within Primary Healthcare, the cost of pharmaceutical services continue to run well ahead of the funding available, this is in despite of an additional £1.1m being made available in 2005/06 by Treasury. The cost of drugs has, on average over the past six years, increased by 9.6% per annum and in the last three years has never been less than 10%. Worsening the situation, the number of prescriptions over the same period has increased on average by 5.3% per annum. For 2005/06, the total gross cost for pharmaceutical services is projected at £18.4m – being £1.5m over budget.

    The new hospital has also experienced an increase in demand for its clinical services, as can be demonstrated by the reported levels of activity. Over the past year, to 31 July 2005, theatre procedures have increased by a further 11% to 9,349; day cases by 13% to 4,450; and outpatients by 5% to 63,064. This increase in activity is reflected in the projected overspend for clinical supplies and drugs at £2.0m.

    Social Services are also faced with an ever growing demand for their services, be it for aids and adaptations, children services or adult services. In particular, in order to meet the demand for children services, the Division was left with no choice but to appoint third party contractors to provide the require specialist services. The current funding available for this service is substantially less than incurred costs, with a projected overspend for the current financial year of approximately £2.4m.

    The Department has been requested by the Council of Ministers to use its best endeavours to make internal savings of £1.5m by the end of the financial year on 31 March 2006. Along with the £6.5m additional funds, this saving will offset the projected overspend.

    18th January 2006

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