Next year will be one of the most challenging the health service in Northern Ireland has ever faced, staff have been warned.
The squeeze on health spending is anticipated to be "greater than anything in recent memory", the senior civil servant in charge of the NI Department of Health cautioned.
In a Christmas message to Health and Social Care (HSC) staff, Permanent Secretary Richard Pengelly, said despite the financial challenges, he felt there were still grounds for optimism, as major plans to restructure service delivery in the region were progressing.
The health service in the region currently receives around half of Stormont's annual £10bn funding allocation. While potential budget scenarios for the next two years envisage a ring-fencing of that £5 billion, inflationary pressures within the sector, currently running at around 5-6% a year, would still mean significant real term cuts.
Responding to this month's budget mapping exercise, drafted by civil servants in the ongoing absence of powersharing ministers, the NI Department of Health said none of the spending scenarios outlined would free up enough money to enable it to maintain services at current levels.
In the festive message circulated to staff, Mr Pengelly, who is running the department in the continued absence of a devolved health minister, offered a "heartfelt thanks" for their work in 2017.
"I know there are times when many of you feel under pressure and under-appreciated," he wrote.
"Please be assured that you are held in the highest regard and that people across all communities feel a very deep sense of gratitude for the work you do.
"For many, 2018 will be a significant year given that it will mark its 70th anniversary of the NHS, and this will rightly be a time of celebration for all that has been achieved.
"However, it has to be acknowledged that, for us in HSC, it will also be an exceptionally challenging year - indeed one of the most important in the history of the health and social care service here.
"Budget pressures are due to intensify significantly, and the projected squeeze on public funding in Northern Ireland for the next two years - for all services - is greater than anything in recent memory.
He said the service was facing two other key challenges - an outdated system of service delivery and ever rising demand as people live longer.
But he insisted a Stormont roadmap to reform the system was still on track. The blueprint was agreed by the Sinn Fein/DUP-led executive before its implosion earlier this year. Despite a lack of ministers, preparatory steps to implement the major change programme have continued through 2017.
"I believe we can approach 2018 with a degree of optimism," said Mr Pengelly.
"That is because we have a clear roadmap to a better service - the transformation route clearly described in the Delivering Together document.
"Transformation can deliver quicker and better quality care - taking the pressure off hospital services by supporting people to stay well, safe and independent in the first place, enhancing primary care and developing better care pathways. It can also make our services more effective and efficient, and will help us tackle unacceptable waiting lists."
He added: "I know people working right across HSC are ready, willing and able to make this change a reality - that in itself is another huge reason for optimism.
"So Merry Christmas, and let's look forward to a challenging but rewarding 2018."