NHS finance directors will have watched George Osborne deliver today’s much-anticipated Summer Budget in the hope that some clarity will be given on how and when the £8bn funding injection promised to the NHS by the Government will be deployed.
While some welcome developments for the health service were announced, there remains an urgent need for more transparency on that £8bn figure if NHS organisations are to bring out the widescale changes that will be needed to meet efficiency targets and become fit for the future. HFMA is calling for the funding to be front-loaded to enable the service to make the investments needed to start realising those savings. The longer we go without clarity and the funding kicking in, the longer it will take for benefits to be realised in a health service already facing huge financial challenges.
Recent HFMA and King’s Fund research show few signs of the financial situation in the NHS improving. Our own Temperature Check survey of provider and commissioner finance leaders – the first research of its kind since the new government took office – revealed that more than three-quarters of provider trust finance directors expect to be in a worse financial position at the end of 2015/16 than they were in 2014/15 – and almost two-thirds were forecasting a deficit for the end of this financial year. This is up by a third from the 47% that finished 2014/15 in deficit.
Finance directors are already putting into practice ambitious plans to save through improving efficiency, from procurement savings to supporting staff to work in different ways. While this will help protect and maintain services, we just can’t rely on these measures alone to plug the remaining £22bn gap in NHS finances. With an increasing demand for services and an ageing population, it means transformation of service provision is the key to a sustainable, fit-for-the-future NHS. It is imperative to note that this will require short-term investment before long term benefits are realised.
Paul Briddock is Director of Policy at the Healthcare Financial Management Association.