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| Local health boards bailouts 'unsustainable' - Auditor General | Local health boards bailouts 'unsustainable' - Auditor General |
| (about 2 hours later) | |
| By Toby Mason Political reporter, BBC Wales | By Toby Mason Political reporter, BBC Wales |
| A finance watchdog has warned that £24m in cash bailouts given to four Welsh local health boards (LHBs) are "unsustainable". | A finance watchdog has warned that £24m in cash bailouts given to four Welsh local health boards (LHBs) are "unsustainable". |
| Aneurin Bevan, Cwm Taf, Cardiff and Vale and Powys Teaching boards received £24m in Welsh government loans in May. | Aneurin Bevan, Cwm Taf, Cardiff and Vale and Powys Teaching boards received £24m in Welsh government loans in May. |
| Auditor general Huw Vaughan Thomas said that as a result the LHBs now faced larger deficits to make up this year. | Auditor general Huw Vaughan Thomas said that as a result the LHBs now faced larger deficits to make up this year. |
| The Welsh government has denied that the money amounted to a bailout and has ordered the LHBs to pay it back. | The Welsh government has denied that the money amounted to a bailout and has ordered the LHBs to pay it back. |
| It has also said the boards face an inquiry into their savings plans. | It has also said the boards face an inquiry into their savings plans. |
| Mr Thomas said that without the emergency loans the boards in questions would have failed in their legal duty to break even at the end of the last financial year. | Mr Thomas said that without the emergency loans the boards in questions would have failed in their legal duty to break even at the end of the last financial year. |
| He also revealed the extent of the funding gap faced by each of the four boards in this financial year: | He also revealed the extent of the funding gap faced by each of the four boards in this financial year: |
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| "The 2011-12 financial year presented every health board in Wales with significant financial challenges because of the downward pressure on funding and the continuing upward pressure on service demand," said Mr Thomas. | "The 2011-12 financial year presented every health board in Wales with significant financial challenges because of the downward pressure on funding and the continuing upward pressure on service demand," said Mr Thomas. |
| "In my view, the historical pattern of the Welsh government providing health boards with additional funding in year to manage deficits is not sustainable. | "In my view, the historical pattern of the Welsh government providing health boards with additional funding in year to manage deficits is not sustainable. |
| "That said, there are positive signs that the NHS in Wales is prepared to take the tough choices needed to deliver long-term change, although clearly it is a very challenging agenda." | "That said, there are positive signs that the NHS in Wales is prepared to take the tough choices needed to deliver long-term change, although clearly it is a very challenging agenda." |
| Mr Thomas said he would be shortly publishing his Health Finances report, which would provide a more detailed assessment of the financial position across NHS bodies and the financial challenges that the NHS in Wales faces. | Mr Thomas said he would be shortly publishing his Health Finances report, which would provide a more detailed assessment of the financial position across NHS bodies and the financial challenges that the NHS in Wales faces. |
| A Welsh government said the Wales Audit Office recognises the achievement of NHS organisations in meeting their financial targets and that ministers had taken a "prudent course of action" to support them. | A Welsh government said the Wales Audit Office recognises the achievement of NHS organisations in meeting their financial targets and that ministers had taken a "prudent course of action" to support them. |
| "It is important to note that the additional funding was not a bailout," said a spokesman. | "It is important to note that the additional funding was not a bailout," said a spokesman. |
| "The health boards were allowed to draw down a small percentage (0.2%) of the future year's funding in order to provide some flexibility to manage their finances across the financial year end. | "The health boards were allowed to draw down a small percentage (0.2%) of the future year's funding in order to provide some flexibility to manage their finances across the financial year end. |
| "As a condition of this flexibility, an external financial review of these organisations' financial plans has been commissioned. | "As a condition of this flexibility, an external financial review of these organisations' financial plans has been commissioned. |
| "We are investing more than 43 per cent of the total Welsh government budget in health and social services - despite significant cuts to our budget by the UK Government." | "We are investing more than 43 per cent of the total Welsh government budget in health and social services - despite significant cuts to our budget by the UK Government." |
| But Plaid Cymru finance spokesman Ieuan Wyn Jones AM said ministers should focus on sorting out financial mismanagement within the health service. | |
| "The Welsh government is clearly failing to control its spending," he said. "Bailouts have doubled in just three years, and yet the Labour health minister has failed to get to grips with the situation." |