The summit began by examining today’s financial climate. “The chancellor is looking at state funding of about 36% of national income,” the conference heard. “That will require some really, really tough cuts in spending both in the short and medium term.”
The impact of funding reductions is exacerbated because the UK’s population is expanding and ageing. “Very soon we’ll be in a place where half of all public spending goes on pensions and health,” delegates were told. “We are squeezing every other function of government.”
The rationale for continuing austerity was also debated. Unlike Greece, the UK is not under signifi cant external pressure to reduce its debt, so the Conservatives could soften their stance before 2020. “One of the things they regret is a lack of emphasis on growth policies in 2010,” one speaker noted.
The CFO of a London borough told delegates his how council has built a strategy to cope with austerity. It uses a three to four year horizon, aiming for bigger cost savings than are needed on paper. “Even if you don’t quite get there, it means you set off on the right path,” he said.
A hospital trust CFO said progress in the NHS is hampered by annual budget and contract negotiations between providers and commissioners. “They take hours and hours and it’s debatable how much difference they actually make,” she said.
Trusts in her region have been linking up to collaborate and to avoid cost-shunting. “If we close an A&E, what impact would that have on other services, and the knock-on into elderly admissions and community care?” she said.
In a similar vein, a speaker from the social care sector said many cuts are being made in the dark. “We must make sure we don’t cut the very things that could contribute towards us being more sustainable,” he said.
The CFO Summit was sponsored by:
