90% of hospices in Wales “are budgeting for a deficit” with call on Welsh Government to ‘address the immediate funding challenges’

The Senedd have been told “every hospice in Wales is projecting a deficit for this financial year. All hospices are drawing on reserves to make up the shortfall and protect services”.

The topic was debated in the Senedd after a motion was moved by Mabon ap Gwynfor and was supported by Adam Price, Cefin Campbell, Jane Dodds, Mark Isherwood, Peredur Owen Griffiths, Sioned Williams MSs.

The formal motion noted “rising staff and energy costs, workforce pressures, and increasing demand for complex care pose an existential threat to the sustainability of the sector” with “90 percent of hospices are budgeting for a deficit in 2023/24 and drawing on reserves to meet the shortfall”.

They called on Welsh Government to “…commit to working with the sector to address the immediate funding challenges, including ensuring a fair salary offer for the hospice workforce” and “develop a long-term sustainable funding solution in partnership with the sector”.

Mabon ap Gwynfor MS said, “Consider this: if these hospices didn’t do this whole range of work, then who would have to step into the breach? Well, there are two choices: (1) leave people to suffer, or (2) transfer all of the expectations and responsibilities onto the shoulders of our health boards. But, of course, there is a third option, which is to support our hospices and to let them do the work that they specialise in. Because the truth is that these kind donations that fund the vital work of our hospices take a great deal of pressure off the public purse and represent a significant discount for the NHS.”

“The health sector in its entirety is facing huge challenges, with a shrinking funding envelope, increased costs due to huge inflationary pressures and recruitment struggles. The charitable hospice sector is no different in that respect, but there is a distinct difference too. And that is, when our health boards find themselves in financial difficulties, they routinely get bailed out. On the other hand, if a charitable hospice should find itself in financial difficulties, then not only do they have to cut services or close, but that funding stream disappears and those pressures are then immediately transferred onto a struggling health board.

“Rising staff and energy costs, workforce pressures and rising demand for increasingly complex care pose an existential threat to the short- and medium-term sustainability of children’s and adult hospice services in Wales. Many hospices are already making, and/or, in some cases, planning cuts to services. NHS pay increases over the last two years have pushed total hospice staffing costs up by approximately £5.4 million, and Welsh hospices are committed to paying a fair and competitive wage to their brilliant staff, but this clearly comes at a cost.”

The chamber was told every hospice in Wales is projecting a deficit for this financial year and all hospices are drawing on reserves to make up the shortfall and protect services – with Welsh hospices on average having just 10 months in reserve, with some having as little as three months.

Mark Isherwood MS said, “I chaired the cross-party group on hospices and palliative care’s inquiry into experiences of palliative and end-of-life care in the community during the COVID-19 pandemic. Our report, published last January, found that the number of people requiring palliative care is forecast to grow by over 40 per cent by 2040, with much of this growth in community settings.

“Every hospice in Wales is projecting a deficit for this financial year, drawing on their very limited reserves to make up for the shortfall and protect services. The harsh reality is that Welsh hospices are already making cuts to services, with 80 per cent of Hospices Cymru members telling us that pressures are highly likely to result in them having to further reduce the volume of certain services delivered. This will result in reduced support being available to the wider system, such as hospitals and care homes, placing greater end-of-life pressure on an already overstretched NHS Wales. Over 80 per cent of hospices with in-patient units believe cost-of-living pressures are highly likely to result in one or more in-patient beds being temporarily or permanently unavailable.

“The majority of their care, however, is delivered in the community through their own charitable fundraising efforts, significantly reducing numbers of hospital admissions and enabling patients to stay at home. However, rising staff and energy costs, workforce pressures and increasing demand for complex care pose a serious threat to Welsh hospices continuing to be able to do this, and to their ability to be key partners in helping transform palliative care services for the future. NHS pay increases over the last two years have pushed total hospice staffing costs up by approximately £5.4 million. Both adult and children’s hospices in Wales are committed to paying a fair and competitive wage to their brilliant staff, but can’t keep pace with either NHS pay rises or significant inflation on all areas of their provision.””

Minister for Health and Social Services, Eluned Morgan responded to the debate and motion, “I think we can all agree that charitable hospices play an absolutely essential role in providing high quality end-of-life care and support.

“I know hospices are facing increasing challenges, and that, like everyone else, they’re trying to manage these increases in energy and running costs. I’ve met with Hospices Cymru, the organisation that represents hospices across Wales, and individual hospices to discuss their concerns.

“I’ve also visited Nightingale House Hospice and Tŷ Hafan just to see for myself the first-hand challenges that they’re facing.

Speaking of other hospices visited and on other feedback she added, “They have informed that 90 per cent of hospices are budgeting for a deficit in 2023-24, and they’re drawing on reserves to meet that shortfall. I absolutely recognise this is a difficult situation for hospices to be facing. As Members are aware, we are in a difficult situation financially, and this comes at a time when we’re also trying to recover from the impact of the pandemic, and to get to grips with the fact that we do have an ageing population. Some of the figures that we were told about by Mabon in terms of the increase that we’re likely to see in this space is something that we have to take seriously.

“We have committed to working with the hospice sector to address these issues, and to investigate what else we could do to help support hospices. You’ll be aware that in 2021 we made a programme for government commitment to maintain a focus on end-of-life care, and to review hospice funding. In October 2022, we published the quality statement on end-of-life care and palliative care, and despite the challenging circumstances we continue to uphold these key Government commitments. So, we’ve delivered on the initial phase of the hospice funding review, and we did provide an additional £2.2 million for hospices on a recurrent basis from April 2022.

“Now, in response to the second phase of the review, funding is being made available to increase the capacity of district nursing and community clinical nurse specialists, some specifically focused on end-of-life care as part of that Further Faster programme; it was good to speak to the hospice about that. The palliative and end-of-life care programme team is now working to deliver the third and final phase of the funding review. That work is being carried out in collaboration with the voluntary hospice sector to understand and to interpret the differences, the inequities and the risks to current funding and commissioning arrangements.

“This phase will include consideration of many of the pressing issues that hospices are facing, including those inflationary uplifts to current funding streams, the service-level agreements and improving equity for hospice funding, an appreciation of the workforce challenges, and the impact that an ageing population has on end-of-life care both in the medium and longer term is also being considered to enable more effective planning for future needs.

“We expect the final version of the interim phase 3 report to provide recommendations for the short to medium-term, and I expect to see these later this month. Those for the long term will also be completed later this year, and we will take our time to consider them fully. But I do want you to be aware that I am taking this issue seriously. I do understand how serious the situation is in a period that is financially particularly challenging. ”

Speaking on specifics of the motion, the Health Minister added, “Now, in terms of the specific demands of the Welsh Government in section 2 of the motion, I fully agree with point a), that working alongside the sector is crucially important. I have mentioned previously that the palliative and end-of-life care team have started to implement this already, and they are looking at the specific issues in terms of funding and the challenges faced by the sector.

“They’re also considering the planning work for the longer team. The programme team is also considering whether it is possible to develop a national commissioning framework for hospices. Such a framework would seek a sustainable financial solution for the longer term in partnership with the hospice sector, and it would also provide a national programme in place for palliative and end-of-life care.”

Mabon ap Gwynfor MS responded, “Well, this is fundamentally about fair funding for our hospices—not necessarily always new money, albeit that is also an important factor where they are looking for an uplift, and for security, and hearing of that ring-fenced fund security will hopefully alleviate some of the concerns. It’s also about ensuring that they receive the money that they have effectively been promised previously.”

“Why should specialist end-of-life care in comfortable surroundings depend on how many second-hand clothes or how many people run a specific race, and how much funding that they can raise locally—why should they be dependent on that? That’s not a model that can be justified in modern society.”