Data from Hospice UK reveals that hospices in Scotland are budgeting for an unprecedented collective deficit of £16m in 2023/4, as the cost of paying their dedicated staff a fair wage increases and statutory funding fails to keep up.

Spiralling staffing costs due to NHS pay increases plus rising running costs are stretching hospice finances to the brink, with many being forced to consider cutting vital services and draw on limited reserves to meet the shortfall.

Scottish hospices spend over 70% of their costs on staff. They recruit from the same pool of staff as the NHS so must match NHS salaries to ensure they are able to attract and retain staff to deliver their vital services for people at the end of their lives. But as matching NHS pay sends costs soaring, without additional statutory funding hospices have to rely on fundraising to pay for every penny.

In Scotland, hospices provide care and support to 21,000 children and adults a year, and with demand for palliative care predicted to increase by 20% by 2040 the support they need will become increasingly important in the future. They play an integral part in the health and care system, supporting people to stay at home and out of hospital, but remain largely funded by charity. On average, two thirds of hospice income is raised through fundraising. The remaining statutory funding is government funding that is primarily allocated and distributed through local Health and Social Care Partnerships. But with the cost of living crisis meaning local communities may not be able to give so generously, rising costs pose a threat to the sustainability of the sector as statutory funding fails to keep pace.

These funding pressures are compounded by huge variation in the levels of local statutory funding that hospices receive across the country. This leads to inequity for patients and families and creates a postcode lottery in terms of how palliative care is funded. It is not fair that the public has to foot more of the bill for palliative care services in some areas of Scotland compared to others.

Helen Malo, Policy and Advocacy Manager for Scotland at Hospice UK says: “Hospices care for some of the most vulnerable people in society, but many are now worrying about the future of their services. Hospices need urgent support to ensure they can continue delivering high-quality care for people at the end of life – without worrying about how to pay their hard-working staff a fair wage. To expect hospices to match this through further fundraising, at a time when their local communities may be struggling themselves is increasingly untenable. Scottish Government must commit additional funding for hospices in its upcoming budget to help address the huge £16m deficit facing the sector and ensure hospice funding is sustainable in the long term, so hospices can continue to support the people who need them most.

Jacki Smart, Chair of the Scottish Hospice Leadership Group says: “Hospices across Scotland are facing the immense challenge of meeting rising costs without additional funding. With staff costs contributing such a significant amount to the collective deficit figure, it is unreasonable that hospices have to rely on charity to pay their dedicated staff a fair wage whilst government support funds the increase paid to similar staff in the NHS. Our staff provide brilliant and compassionate care to people at the most vulnerable time of their lives. They should be valued and treated equally with NHS colleagues who do the same.”

Jackie Stone, CEO of St Columba's Hospice Care says: "With more demand on our services than ever before here in Edinburgh and East Lothian, we’ve already seen increases in referrals of over 45% over the course of our current strategy, and with rising costs, we now require a meaningful review of the statutory funding model. A historic commitment to fund 50% of adult hospice costs is sadly not the case and we currently receive a welcome, but insufficient, 22%.

We’re grateful that the conversation is gathering pace, and I remain positive that the incredible work we deliver every day, and which is delivered by all of our hospice colleagues across Scotland, will be fully recognised and properly funded by the Government. We all know that times are challenging, but end of life care must be a priority for all."