Health of NHS finances ‘puts Long Term Plan in jeopardy’

3 Apr 19

Delivery of the NHS Long Term Plan is threatened by a “worrying level of disparity” in the financial performance of local health bodies, MPs have warned.

Unequal finances of Clinical Commissioning Groups and trusts will make it difficult to achieve the NHS plan’s objectives, becuase of issues including staff shortages and increasing waiting times, the Public Accounts Committee has said.

The PAC report, out today, said that while the NHS did balance its overall budget in 2017-18 the top level picture “masks significant local disparities”.

In 2017-18, NHS England, CCGs and trusts reported a combined deficit of £21m and while this represents a “near balanced” position, it was achieved through offsetting NHS England’s £1.2bn underspend and deficits in trusts (£991m) and CCGs (£213m).

The combined trust deficit also hides a “wide variation” in performances of individual trusts from a £77m surplus to a £141m deficit, according to the PAC.

“It is unacceptable to simply offset surpluses and deficits in the presentation of these overall budget results,” the report said.

The NHS Long Term Plan sets out the expectation that the number of trusts reporting a deficit will be more than halved by 2019-20, and by 2023-24 no trust will be reporting deficit. But in 2017-18, the Department of Health and Social Care handed out £3.2bn in loans to support trusts in difficulty.

In 2017-18, 100 out of 232 trusts were in deficit and the PAC said it was “overly optimistic” to assume financial stability can be improved in such a short space of time.

With around 100,000 vacancies the NHS “will not be able to deliver against the plan unless it addresses staffing shortages,” the PAC added.

Workforce shortfalls are getting worse for both GPs and nurses and will require an extra £900m a year to fix, according to a recent study.

The report recommended the government tell the committee by July how it intends to address issues around recruitment and retention of staff.

Eleanor Roy, CIPFA Policy Manager, Health and Social Care said: “It is disappointing to note yet another report expressing serious concerns regarding the financial position of the NHS.

“Today’s progress review reiterates the concerns we have long expressed regarding both the current position and the long-term sustainability of NHS finances.

She added: “The lack of clarity on social care funding will undoubtedly be having an impact on Sustainability and Transformation Plans/Integrated Care Systems ability to formulate their 5-year plans, and with the social care green paper delayed yet again, we are concerned that the impact of this will be increasingly significant.”

Meg Hillier, PAC chair, said: “Staff shortages are a clear threat to the delivery of the NHS Long Term Plan and by July we expect to see evidence that government has a plan to address them.”

She added: “No one should take solace from a top-level financial picture that, as highlighted by our recent reports on DHSC’s accounts and CCGs, masks significant local disparities.”

A Department of Health and Social Care spokesperson said: “Putting the NHS back onto a sustainable financial footing is a key priority of the Long Term Plan and our historic five-year funding settlement of an extra £33.9 billion a year by 2023/24 gives the health service the certainty it needs to deliver world-class care for patients.”

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