Qld hospital budgets will be held accountable as FNQ health services report deficits

Qld hospital boards will face increased scrutiny over financial transparency as the FNQ services collectively blew their expense budgets by almost $100m. See their income statements

Queensland health minister Tim Nicholls, Torres and Cape Hospital and Health service chief executive Rex O'Rourke and Cairns and Hinterland Hospital and Health Service chief executive Leena Singh.

Queensland hospital boards will face increased scrutiny over financial transparency the health minister says, as the Far North’s services collectively blew their expense budgets by almost $100m.

The Cairns and Hinterland and Torres and Cape Hospital and Health Services both reported net operating deficits in the 2024-25 financial year with staffing identified as the most significant cause of overspending.

But health minister Tim Nicholls defended the public service, stating hospitals were being forced to hire expensive locum staff or pay overtime to already stretched frontline employees to meet workforce needs.

CHHHS had an expense budget of $1.44bn but spent $1.51bn, with most of the $73.2m difference attributed to employee expenses which were $27.6m over budget and department of health contract staff which was $121.7m over budget.

The health service’s income statement showed it spent less than expected on “other supplies” and received more than expected in user charges and fees, balancing out its total deficit to $26m.

Read more: How CHHHS performed in 2023-24

CHHHS chief executive Leena Singh welcomed the surplus in “over delivering” funded activities.

“We are continuing to look at innovative ways to deliver our services as efficiently as possible to ensure we can spend these funds on expanded clinical services and technology or improvements,” she said.

Cairns and Hinterland Hospital and Health Service chief executive Leena Singh. Picture: Brendan Radke

“We’ve invested in new health information systems and are particularly proud to have a fully integrated health records system … particularly across our rural facilities.”

TCHHS’s expenses budget of $351.6m was overshot by $24.5m, and it too received more than expected in user charges, concluding its income statement with an overall deficit of $4m.

The health service’s largest overspend was on department of health contract staff where it exceeded budget by $11m, while spending less than budgeted on employee expenses.

Its chief executive Rex O’Rourke said the health service’s remote and isolated community intake with high levels of social and economic disadvantage presented “complex challenges for achieving equitable outcomes.”

“Our primary cost increase drivers were patient travel, logistics, ongoing repairs and maintenance, and the employment of clinical staff,” he said.

“These pressures were compounded by national and global workforce shortages.

“While we prioritise permanent recruitment, we continue to rely on temporary staff when needed.”

Cape Hospital and Health Service CEO Rex O'Rourke. Picture: Brendan Radke

Mr O’Rourke explained final operating budgets were often higher than the announced opening budget due to periodic funding adjustments.

The health minister said the government’s budget allocation for Cairns had increased by 8.8 per cent and 10.5 per cent for the Torres and Cape service in the new financial year.

“The Crisafulli Government is returning to proper budgeting by ensuring the independent boards of HHSs are held accountable for the decisions they make.

“This didn’t happen under Labor. (I have) met with all HHS chief executives to discuss the government’s expectations of financial transparency.

“Its why the Government now requires by law a clinician who works at an HHS to be on the board of that HHS.”

Originally published as Qld hospital budgets will be held accountable as FNQ health services report deficits