7 September 2010 Last updated at 07:32 ET

NHS in Wales faces £380m cutbacks

By Hywel Griffith BBC Wales Health correspondent

The Welsh NHS faces making more than £380m worth of cutbacks by next April, with managers saying it is the biggest challenge they have faced in 20 years.

BBC Wales research shows savings targets have been imposed on staff pay and changes made to hospital services to reduce costs this financial year.

More cuts may be necessary depending on the outcome of the UK Government's public spending review in October.

The assembly government said the review was "profoundly important for Wales".

The Conservatives said the cutbacks were based on funding to the assembly government by the previous Labour government in Westminster.

Some health boards predict fundamental changes to reduce costs.

Some have already imposed "rigorous vacancy controls" and said there would be "fundamental service reconfiguration" in years to come.

One health board document warns that "tension will increase" between what patients will expect and what the NHS can provide.

The largest health organisation in Wales, Betsi Cadwaladr University Health Board has an annual budget of over one billion pounds, but faces a savings target of more than £70m in 2010-11.

"I wouldn't pretend that its easy, but there are opportunities." says vice-chair Dr Lyndon Miles.

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"We are looking at lots of areas - we are looking at the way we spend at the moment, for example employing locums and agency staff and the way we recruit."

Reforming the workforce and reducing the wage bill is a common theme across the seven health boards and three NHS trusts - with Betsi Cadwaladr UHB hoping to save £14m in 2010-11.

The health board has already introduced changes to its services, such as the plan to close HM Stanley hospital in St Asaph, Denbighshire, with more services being moved into the community.

"It is a challenge. A lot of people are working hard to meet the challenge. It is clear that we can't stay as we are - we do need to change," admits Dr Miles.

The Welsh Assembly Government said the outcome of the spending review in October "will be profoundly important for Wales - and undoubtedly the most important since devolution".

In terms of the likely future impact on the Welsh NHS, it says it is "continuing to consult closely, openly and seriously with front-line workers and engaging with communities the length and breadth of Wales to ensure we work together to protect essential public services."

Welsh Conservative health spokesman Andrew RT Davies, said: "These spending cuts are Labour's cuts, to be implemented in this financial year.

"They are based on funding to the assembly by the previous Labour Government in Westminster and implemented by the current Labour-Plaid Assembly Government."

He challenged the Welsh health minister to investigate reports as much as 20% of the Welsh health budget "was being wasted every year".

SAVINGS PLANS 2010/11
HEALTH BOARDS	ACTION
Abertawe Bro Morgannwg	£77.4m savings in 2010/11 Part of total £287.2m savings over five years 'Fundamental service reconfiguration and rationalization' needed Changes to renal, orthopaedic and emergency care long term
Aneurin Bevan	£79m savings in 2010/11 Long term reduce 'fragmented and duplicated services' at Royal Gwent and Neville Hall £9m of savings on recruitment and agency staff in 2010/11 'Rigorous vacancy controls'
Betsi Cadwaladr	£70.8m savings in 2010/11 Three main hospitals 'no longer provide all the same services' long term £14m of savings in changing workforce in 2010/11 £19.8m savings in service redesign in 2010/11
Cardiff and Vale	£79.3m savings in 2010/11 Part of £344.6m savings over five years £15m of savings from workforce redesign in 2010/11 £4.1m by reducing duplication between UHW and Llandough hospitals in 2010/11
Cwm Taf	£37.2m savings in 2010/11 'Maximise the benefits of improved quality and service redesign' Include saving £5.5m a month in Jan, Feb and March 2011 'Plans will need to be developed as soon as possible'
Hywel Dda	£21.45m savings in 2010/11 Part of £55m savings over three years 'Tension will increase between public/patient expectations' £19m saving from service re-design over three years
Powys Teaching	£9.4m savings identified so far for 2010/11 Minimise exposure to higher cost English and private sector provision £6m saving in 2010/11 by shift to community services and emergency-only admissions in north Powys 'May have a need for less staff in higher bands (not concluded as yet)'
OTHER HEALTH SERVICES
Wales Ambulance Service	£4m savings in 2010/11 'Unprecedented need for financial savings' Forecast £8.8m deficit in 2010/11 'Cost reductions beyond efficiency measures will become the norm'
Velindre Trust	£1.8m savings in 2010/11 'Restructuring of the workforce and reducing cost base… may be insufficient' Cancer centre currently heading for £0.5m deficit in 2010/11 'Increased provision of outreach chemotherapy services from Velindre cancer centre'
Public Health Wales	£3.7m saving for 2010/11 'Needs to take significant action if financial balance is to be achieved' Use of vacancy control to avoid filling non essential posts Curtail or ceased specified services in agreement with funders.