DHB in desperate rush to rein in debt

Wrestling Capital & Coast District Health Board's debt into line has been described as "landing a jumbo jet plane on a postage stamp", as its budget deadline looms.

The financially stretched board is trying to save money by cutting everything from board lunches to water coolers in a last-minute squeeze before the end of the financial year this month. Some unions have claimed the cuts risk compromising patient safety, something the board has strongly denied.

During a board meeting yesterday, members were presented with the latest financial figures, showing the board was about $3 million on the wrong side of its budget for the year to April.

The biggest cost blowout came in paying nurses, where $7.2m had been spent above budget, but the use of casual staff and clinical supplies also contributed.

Several board members questioned whether the budget could be brought into line before the end of the financial year.

Interim chief executive Debbie Chin told the board that she hoped to hit budget but it would be tight. "It's like landing a jumbo jet on a postage stamp," she said. "The expectation is there but there are some real risks."

Last month, Chin told staff there had been a "sudden deterioration" in the board's finances and about 5 per cent in savings needed to be found within six weeks.

Yesterday, she said staff had volunteered at least 60 cost-saving ideas, ranging from using less linen to turning office lights off at night, some of which had been taken up. The board would not know till mid-July whether it had hit budget.

It is still under intensive monitoring from the Ministry of Health after years of deficits, much of it linked to the costly upgrade of Wellington Hospital.

Since 2008, the deficit has been clawed back from more than $65m to $24m last year, although the board continues to receive emergency top-up funding from the Government.

Along the way, one chief executive has quit, citing concerns about deep cost-cutting, and several board members have retired with similar misgivings.

The board is aiming for a deficit of $6m this financial year and hopes to break even next year.

The Dominion Post