‘Labor’s savage cuts, together with its move to centralise power, will see loss of services, bed closures and loss of jobs’: Georgie Crozier
Victorian hospitals are being asked to find savings in the tens and hundreds of millions of dollars in cuts that are feared will lead to a reduction in frontline services, job losses and bed closures.
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Victorian hospitals fear more than $1bn will be wiped from their budgets in a major blow to the state’s public health system.
Hospital whistleblowers say the extent of cost saving measures being demanded by the Allan government are unsustainable and will force a dangerous reduction in frontline services, job losses and permanent bed closures.
Sources say Monash Health has been working to find savings of $350m, while Alfred Hospital insiders say up to $180m could be wiped from its books.
The Royal Melbourne Hospital could lose $230m over the next two years, Bendigo Health is looking to reduce costs by $120m and Grampians Health is facing a $50m deficit.
Even the Royal Children’s Hospital is bracing for tens of millions of dollars in cuts and job cuts.
On Friday, hospitals and health services were due to formally submit their cost saving models.
The government — which has vowed not to issue any top up funds — will finalise budgets in coming weeks.
Health sources said many hospitals had been asked to find savings of at least 10 per cent.
The state’s 15 major health services reported expenses of $19.2bn in their latest annual reports for 2022-23.
Overall they maintained $45m in profits — with only six of the 15 recording losses including Alfred Health, Austin Health and Eastern Health.
A 10 per cent reduction in spending across just those services would see $1.92bn wiped from their budgets.
Government sources said while budget cuts wouldn’t run that high, there was a concerted push to bring budgets back in-line with pre-Covid levels.
It comes as the Department of Health prepares to put a new performance management framework in place which will require health services to meet strict government targets for spending.
Health services who fail to meet government expectations would face the prospect of strict supervision and potential board intervention.
Sources say the new framework, which is expected to be made public on Monday, will take a much more heavy handed approach than previous frameworks and crackdown on financial wastage and failure to meet other targets.
Health services will also be forced to participate in “improvement-focused performance discussions” with the department, with quarterly meetings mandated even for those meeting their targets.
Some health services have raised concerns about being expected to deliver against unrealistic expectations.
Leaked working documents have warned elective priorities will be removed for next financial year, with services forced to acquit core government priorities first.
They also show some hospital executives have criticised the department for a lack of support for poorly performing services.
Opposition health spokeswoman, Georgie Crozier, said the plan would centralise power around the department.
“True to form, Labor has not consulted with communities or been transparent about their move to take control of health services,” she said.
“Labor’s savage funding cuts together with their move to centralise power will see loss of services, bed closures and a loss of jobs.
“Labor can’t manage money, cannot manage Victoria’s health system and it’s Victorians who are paying the price.”
A government spokesperson vehemently denied hospitals would be forced to reduce surgeries or close beds.
“We are delivering a massive 28 per cent pay rise to Victoria’s nurses and midwives,” she said.
“We are investing a record $20 billion into our hospitals this year alone – including an additional $1.5 billion this financial year.”
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