The Southern District Health Board's financial outlook for the next six months has slipped, with the board's finance chief forecasting a $10 million deficit.
In November, finance and funding general manager Robert Mackway-Jones hoped the DHB would be ahead of its budgeted $10.5 million deficit by about $4 million, but a report to tomorrow's meeting reveals that has changed.
In his report, Mr Mackway-Jones said that while the DHB's year-to-date deficit of $1.1 million was $4.2 million better than budget, its financial performance would deteriorate in the final half of 2011-12.
Factors contributing to the worsening situation included potential write-downs of building values due to them not meeting the minimum building code (the old obstetrics building at Southland Hospital, now used for storage; Dunedin's Hulme House, from which occupants were moved last month to Ashburn Clinic as an interim measure).
Other factors were less revenue from other DHBs (inter-district flows); pharmaceutical revenue changes; filling more mental health positions; elderly residential care costs not declining as expected; medical costs increasing; instrument and equipment costs increasing due to commissioning major assets; increased repair and maintenance costs.
Factors in the good year-to-date result included $1.3 million mental health underspending; unspent primary health organisation funds; between-DHB one-off payments; below-budget hospital and pharmaceutical spending; lower governance fees.
• At its meeting tomorrow, the board will discuss a new mental health and addiction service plan.
In development for more than a year, the plan is the first of its kind and will help determine how money is spent on services.
In her report, acting chief executive Lexie O'Shea said management sought approval to consult the public on the draft plan, to start this month. The plan will also be considered at today's shared disability support and community and public health advisory committee, also in the public excluded session.
