The Treasury Minister has acknowledged significant challenges in controlling health spending and the risk it poses for taxpayers.
This year the DHSC (and by extension Manx Care) is expect to exceed its budget by £20m, despite an allocated budget of £346 million, the department is projected to spend up to £366 million, raising concerns about financial discipline.
For the 2025/26 financial year, DHSC has been allocated £357.5 million, but the Treasury has told the Public Accounts Committee it will be difficult to keep spending below that level.
Dr. Allinson said: “It will be tight. It will be difficult, but we do need, particularly in Manx Care, that level of budgetary control and financial discipline.”
A £10 million contingency fund has been set aside to address potential shortfalls, alongside a £4.1 million departmental contingency and an extra £5 million for transformation.
Recurring
During the PAC sitting, the issue was raised that overspending is nothing new in health and predates Manx Care.
However, chair Juan Watson SHK questioned whether the same last-minute bailouts would occur next year despite more taxpayers money being poured into health.
Dr. Allinson responded by saying he was “extremely disappointed” after last year’s budget, which saw taxes rise and a massive injection of cash into health, only for Manx Care to be projecting a £17m overspend by the end of the first quarter.
He said this was despite Treasury being “reassured by Manx care that that was enough for them to provide the services that they were planning for this financial year”.
Improvements
Manx Care’s cost improvement programme, targeting 1% savings, was also scrutinised.
Officials confirmed the £377 million requested by DHSC was based on this target, but PAC members raised doubts about its feasibility given past overspending.
“We need extra information in real time to hold Manx Care to account,” Dr Allinson said, citing monthly scrutiny panels and an improvement director role.
However, he stopped short of guaranteeing no further bailouts, noting “some tough decisions need to be made along the way”.
This has included the DHSC installing two improvement directors into Manx Care, namely Shaun Stacey and Pete Shanahan.
The Treasury has introduced enhanced financial oversight, including quarterly management accounts and scrutiny panels, to improve transparency.
However, despite this, Dr Allinson said: “Some tough decisions need to be made along the way to fit within the financial envelope.”
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