Nicola Sturgeon under fire after Audit Scotland says some health service boards may not be able to balance books next year

Scotland’s NHS faces massive cuts as the health service fails to keep pace with increasing demand, rising costs and the needs of an ageing population, according to the public finances watchdog.

The damning report from Audit Scotland warns that some NHS boards may not be able to balance their books next year, and reveals that the service met only one of its eight key waiting time targets last year.

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But Nicola Sturgeon insisted the health service was performing better against tougher targets, and that there was “nothing unique about the challenges facing the NHS in Scotland”, with the performance of accident and emergency departments 8% higher than those in England and Wales.

She told the Holyrood chamber during first minister’s questions: “There is now more than £3bn extra investment in the health service compared to the time we took office. There are 11,000 more medical professionals working in our health service. That’s why Audit Scotland says today that staffing levels are at an all-time high.”

During a bruising session, Sturgeon was challenged by the Scottish Conservative leader, Ruth Davidson, about her government’s “outrageous” failure to get a grip on the NHS, while Scottish Labour’s Kezia Dugdale presented individual illustrations of what she described as the “human cost of a decade of SNP mismanagement”.

The criticism of government ministers for failing to outline a coherent vision for the healthcare system was echoed by the director of the Royal College of Nursing Scotland, Theresa Fyffe, who said health boards trying to make savings “often find themselves caught in the crossfire of political and public opinion”.

She called for a “decisive response” from the health secretary, Shona Robison. “Clarity is needed from government on how they will support health boards to deliver the changes needed, and also how all the various health strategies and reforms currently under way will be delivered coherently across Scotland. All politicians need to set aside their differences and work together in order to get this right.”

Audit Scotland reports that the country’s 14 health boards made total savings of £291m last year, which left some needing to use short-term measures to break even. It forecast that the figure would nearly double to £492m in the current financial year.

The report says there is a “need for NHS boards to make unprecedented levels of savings in 2016-17, and a risk that some will not achieve financial balance”.

Facebook Twitter Pinterest Nicola Sturgeon during first minister’s questions at the Scottish parliament in Edinburgh on Thursday. Photograph: Andrew Milligan/PA

The total health budget in 2015-16 was £12.2bn. Although this increased by 2.7% in real terms from the previous year, major expenses have risen more sharply, with staff costs increasing by 6.4% and pension costs up by 18.6% in the past six years.

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Failure to keep pace with rising demand and costs strengthened the case for changing the way services are delivered, according to the auditor general for Scotland. Caroline Gardner said: “The Scottish government has had a policy to shift the balance of care for over a decade but, despite multiple strategies for reform, NHS funding has not changed course.

“Before that shift can occur, there needs to be a clear and detailed plan for change, setting out what the future of the NHS looks like, what it will cost to deliver and the workforce numbers and skills needed to make it a reality.”

The report also highlighted increasing spending by boards on costly agency workers because of significant problems with recruitment and retention of staff, as well as a lack of workforce planning for new models of care to deliver more community-based services. It gave one example of some agency doctors earning £400,000 for less than a year’s work.

The health secretary insisted the Scottish government had made “significant improvements” and had a strategy to change the way services are delivered.

Robison told BBC Radio Scotland the report presented “a very fair and balanced view, confirming that we have record levels of investment and acknowledging that our NHS performs very well compared to the rest of the UK”.

A report for the General Medical Council, also published on Thursday morning, warned that poor morale among doctors could put patients at risk. The regulator said there was “a state of unease within the medical profession across the UK that risks affecting patients as well as doctors”.

In its annual report into the state of medical education and practice in the UK, the GMC also noted that after the anger and frustration in the dispute between junior doctors and the Department of Health, levels of alienation “should cause everyone to pause and reflect”.