‘Short-term fixes’ are making NHS financially unsustainable

‘Short-term fixes’ are making NHS financially unsustainable

February 7, 2020

Continuing to manage NHS budgets through “short-term fixes” is not sustainable, analysis by the National Audit Office (NAO) has concluded.

The spending watchdog has published two reports looking into NHS finances. One looked at the finances of the NHS as a whole and the financial performance of individual NHS organisations, and the second examined the NHS’s capital budget, which is for replacing and maintaining equipment and buildings.

NAO found that NHS provider trusts reported a combined deficit of £827m and clinical commissioning groups (CCGs) a £150m deficit in the last financial year. They said extra money provided by the Government to stabilise the finances of individual NHS bodies had not been fully effective, and that trusts in financial difficulty were increasingly relying on short-term loans from the Department of Health and Social Care (DHSC) to meet their day-to-day running costs.

The reports highlight that patient waiting times have continued to get worse and the number of people waiting for treatment is increasing.

NHS financial management and sustainability

Review of capital expenditure in the NHS

PSNC Chief Executive Simon Dukes said:

“These latest findings from the National Audit Office (NAO) show once again the precarious financial position in which many NHS trusts and commissioners still find themselves in. These reports focus exclusively on NHS bodies, but we know that the lack of sustainable NHS funding is extending to contractors of essential primary healthcare services like community pharmacy as well. Community pharmacies have faced a succession of funding cuts over the years and many are now operating unsustainably yet still providing vital services to patients. The business case is now compelling for the NHS to pay more for key pharmaceutical services on which local communities and other parts of the health service increasingly rely.”

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