Agenda item

To receive a presentation on the Health System Financial Overview 2025/26 for Kirklees from Kirklees Health and Care Partnership.

Contact: Nicola Sylvester, Principal Governance and Democratic Engagement Officer.   Tel: 01484 221000.

The panel received a presentation on the financial position across the Kirklees health system for the 2025/26 financial year.

Gary Boothby, Executive Director of Finance, Calderdale and Huddersfield NHS Foundation Trust advised the Panel that NHS partners were projecting a collective deficit of £7.5 million, with Kirklees contributing a planned deficit of £380,000 after delivering £46.43 million in efficiencies. Other partners aimed to break even, contingent on achieving £28.7 million in savings. Overall, the system was targeting £75.13 million in efficiencies, representing approximately 5–6% of partner budgets. These figures exclude the £7.7 million stretch target allocated to Kirklees as part of the wider West Yorkshire system stretch target.

Efficiencies were being pursued through a combination of transactional, tactical, and transformational approaches. All partners had implemented Quality Impact Assessment and Equality Impact Assessment processes to evaluate the implications of proposed savings. A shared principle had been agreed to avoid cost shunting between organisations.

The panel was advised of significant risks to financial plan delivery, including performance-related income clawbacks, system-wide accountability, where failure by one partner affects all, and operational pressures such as winter demand, industrial action, and staffing challenges. Recruitment and retention issues persisted, particularly within the Integrated Care Board, where organisational changes had led to a loss of local expertise and local knowledge. The system was actively identifying recurrent opportunities to meet the stretch target for 2026/27 and beyond, focusing on slowing or stopping spend rather than additional efficiencies.

Questions and comments were invited from Members of the Health and Social Care, and Children’s Scrutiny Panels, and the following was raised:

• Clarification was requested on the principle of “no cost shunting,” which was explained as a system-wide approach to avoid shifting costs between organisations at the expense of patient care and overall value for public money.
• Concerns were raised about the clarity and accessibility of the presentation slides, which contained jargon and unexplained abbreviations.
• Members asked for further explanation of the financial risks to delivery, including the impact on organisations such as Kirkwood Hospice.
• The panel discussed the significant changes within the ICB, including the mandated 50% reduction in running costs, and the uncertainty around future service delivery responsibilities.
• Questions were raised about the “stretch” target of £33 million across West Yorkshire, with Kirklees’ share being £7.7 million, and how services were being reviewed to identify duplication and improve system-wide efficiency.
• Members sought reassurance that service users were being engaged in decision-making and that patient impact was being monitored through Quality Impact Assessments and Equality Impact Assessments.
• The panel queried the rationale behind the projected £7.5 million deficit despite £105.2 million in efficiency savings, and asked how this would be addressed at year-end and noted that the £7.5 million was part of the West Yorkshire System which balanced with various funding changes taking place across the system.
• Historical context was discussed, with members noting that efficiency savings had been a recurring challenge over many years, and questioning whether savings had ever not been required.
• It was confirmed that savings must be made recurrently to avoid compounding future financial challenges, and that national benchmarking was being used to identify opportunities.
• Members asked whether any partners were at risk of under-delivering on activity targets, which could result in financial penalties or loss of income to the system and noted that there was potential income loss to the West Yorkshire system if partners did not deliver the volume of activity planned, and performance improvements they had signed up to.
• Staffing concerns were raised, including whether efficiencies would result in redundancies. It was confirmed that CHFT had no plans for redundancies and that efficiencies would be met through natural turnover.
• The potential role of AI in delivering efficiencies was discussed, with recognition that while AI could contribute to cost savings, initial investment, training, and governance would be required before benefits could be realised.
• The panel acknowledged the ongoing uncertainty surrounding ICB changes and their impact on the Kirklees health landscape, and noted the current delivery of £105 million in efficiencies against a provisional system-wide deficit of £7.5 million

RESOLVED –

1)    That Officers be thanked for their attendance and presentation.

2)    That the Health System Financial Overview 2025/26 be noted.