NHS financial crisis on government radar

THE Scottish Government are keeping a close eye on the challenging financial situation at NHS Dumfries and Galloway, it has emerged.

The organisation has been escalated to Stage 3 of the NHS Scotland Support and Intervention Framework for finance due to ongoing concerns about its financial sustainability.

And that means enhanced monitoring, additional support, and increased oversight by the government.

Health bosses accept there are still significant issues, including the need to find £21.3 million of savings this year.

Speaking at an NHS board meeting on Monday, interim finance director Susan Thompson said: “Following the delivery of record savings in 2024/25, the Board must now build on this and deliver its most ambitious programme of savings during 2025/26 - equating to over £21.3 million.

“While the current position is challenging, we remain confident that through working with our clinical and operational teams, we will recover the position.”

She confirmed that work continues to focus on meeting the financial targets and to develop savings plans aimed at improving the financial position for 2026/27 and reducing the overall deficit.

Ms Thompson said: “A significant portion of the current 2025/26 financial plan relies on delivering non-recurring savings and funding. This means that these savings are one-offs which do not apply going forward, and that makes improving next year’s position even more challenging.”

The deficit has been building over the past decade, driven by a combination of factors. These include difficulties in maintaining consistent efficiency savings, alongside rising inflation which has increased the cost of clinical supplies and services.

Other pressures include increased staffing, a growing volume of prescribed medicines, higher building running costs - such as gas, electricity, water, and rates - and increased spending on care elsewhere when it can’t be delivered locally.

Additional costs have also come from new national systems like Office 365.

The meeting also noted that the scale of the problems mean difficult decisions will likely be necessary in the short term.