FINANCE: The chair of financially troubled NHS North Yorkshire and York has publicly lashed out over what he sees as its unfairly low funding.

Kevin McAleese made the pointed comments in his paper to the October board meeting of the primary care trust. They will also stoke the debate about how clinical commissioning groups’ budgets are decided nationally, and come as foreign secretary William Hague - an MP in the area - has also commented on the issue.

The organisation is predicting it will record a £19m deficit at the end of 2012-13, and has outlined short-term savings plans to prevent the shortfall becoming even larger.

Earlier this year its chief executive said the area needed a programme of major service change. Commissioners in the area have overspent for several years, and often been bailed out by other areas and the strategic health authority.

However, Mr McAleese indicates the problems are down to the area’s unjustifiably low budget, as decided in the past by the Department of Health.

His paper highlights that the per-head funding for NHS North Yorkshire and York is lower than its neighbours, while it has an aging and rural population. It is lower largely because most of its population is better off than most in the north of England.

The paper says the PCT “finds itself with the largest proportion of over 85s in the Yorkshire and Humber area and the second largest proportion of over 65s, whilst it receives the lowest level of funding per patient for NHS services in the whole of the North of England”.

“Those demographic facts go some way to explain why the local healthcare economy is always cash strapped and always struggling to meet increasing demand for services from patients who rightly and understandably want to make full use of them,” he says.

He points to the decision of the NHS Commissioning Board, expected to be made in December, about how CCGs’ budgets will be calculated. There has been some speculation they will be more closely linked to age than those of PCTs, although the board has itself indicated there is unlikely to be much change in funding.

Mr McAleese’s paper says: “The hope must be that the revised funding formula per patient being released… in December begins to address some of the historic challenges which have always been faced locally with a population spread over 3,200 square miles

“If it does not… the mismatch between the funding available and patient demand for services can only increase and CCGs will face even tougher decisions about priorities and affordability than the PCT board has had to grapple with over the past six years.”

Meanwhile, Mr Hague, the MP for Richmond who has been campaigning against some hospital reconfiguration in the area, told the Northern Echo, a local paper: “As an MP for a rural area I believe there is a good case for rural areas or areas in which there is a disproportionate number of elderly people to have that recognised to some greater extent, but that is up to my colleagues to decide, I am the foreign secretary, not the health secretary.”

The chairman’s paper also complains that – of five directors appointed to the commissioning board’s local area team covering the Humber and North Yorkshire and York area – none of them are currently NHS North Yorkshire and York directors.

It says: “Of those newly appointed directors, three are currently working in the NHS Humber cluster and two are from the NHS Leeds and Bradford Cluster… given the historic challenges and complexities of North Yorkshire and York, I am very disappointed, as I am sure the board will be, that none of the new director roles have been awarded to any internal candidates from NHS North Yorkshire and York with working director level knowledge of the patch.”