Hospital arm of SDHB overspends by $157,000

22:25, Sep 05 2012

The Southern District Health Board's hospital arm is $157,000 over budget at the start of the financial year, a health board committee was told yesterday.

Health board chairman Joe Butterfield asked, at yesterday's Hospital Advisory Committee meeting, if the money was already "down the tube" in the first month of the new financial year.

The result comes after a disastrous close to the previous financial year. The result, still being audited, is predicted to be a $12.7 million deficit. That result takes in the board's funding and provider arms.

The board is expected to discuss the July financial report for both arms this morning.

The report shows overall, both arms are favourable for the month by $500,000.

In the latest report prepared by senior business analyst Grant Paris, the provider arm's $157,000 unfavourable variance was attributed to personnel, outsourced medical costs to cover vacancies, clinical supplies and infrastructure.


It was unclear how much of this figure was the timing of how certain costs - such as staff taking annual leave - had hit the July budget.

Mr Butterfield's main question - "will it be recouped" - was difficult for Mr Paris and manager of funding and finance Robert Mackway-Jones to answer.

"Some of it is permanent; some of it is timing," Mr Paris said.

Mr Butterfield said he was struggling to understand what the unfavourable balance indicated for the coming year.

Committee member Richard Thomson said the board faced a similar situation last year.

Mr Thomson asked for further data that would keep the board "clued in so better questions of staff could be asked" and if the board should "challenge harder, earlier" when finances are troubling.

The Southland Times