Update on PSNC Funding Negotiations

Update on PSNC Funding Negotiations

February 9, 2021

Ahead of further rounds of Ministerial meetings, PSNC has today once again underlined its position that community pharmacy contractors must be compensated for the full impact that the COVID-19 pandemic has had on their businesses, and warned of the impact on patient services if this does not happen.

Contractors will be aware that PSNC has two as yet unresolved funding bids with HM Government: one on COVID-19 costs and the second for an uplift to wider Community Pharmacy Contractual Framework (CPCF) funding. We are currently discussing both these issues with Ministers.

On COVID-19 costs we have put extensive data and evidence to the Department of Health and Social Care (DHSC) and NHS England and NHS Improvement (NHSE&I) showing the costs that contractors have incurred as a result of the pandemic. This evidence was drawn from our ongoing contractor surveys and it shows the increased costs of staffing and operational matters such as implementing social distancing measures, as well as the impact on pharmacy businesses from reductions in services and retail income.

PSNC wants the £370m in advance payments received by pharmacies in 2020 to be written off against these costs, many of which are still ongoing. This proposal has been supported by the sector and by cross-party MPs on the All-Party Pharmacy Group.

PSNC received an initial offer on COVID-19 costs from HM Treasury (HMT) in the summer and rejected this as being too limited. We then put additional data to HMT in the autumn, and although we have not yet received a formal response to that, we understand that there has been little movement from that original position.

PSNC Members met last week to discuss this and other topics. While the Committee is pleased with progress on COVID-19 vaccinations and looking forward to pharmacy playing a growing role in this critical effort, the Committee is deeply concerned about the impact that any payback of the advance payments would have on patients, contractors and on wider pharmacy services.

PSNC is in ongoing dialogue with Ministers to highlight the critical role that pharmacies are playing, and to outline our costs case and seek to influence the HMT position. Although we know that politicians support the sector, this does need to translate into positive funding outcomes.

A summary of the February PSNC Meeting is available here.

Simon Dukes, PSNC Chief Executive said:

“The role that pharmacies have played, and continue to play, through the COVID-19 pandemic has been faultless: you have been absolutely critical both to patients and to keeping primary care services going. You have been the buffer for the NHS.  You have absorbed the costs of doing that in good faith, and despite the exhaustion of your teams you are also now pushing hard to be recognised as a key provider of COVID-19 vaccinations. There is nothing more you could do.

PSNC is pushing for your costs to be fully covered by HM Government, in line with promises to give the NHS all that it needs through the pandemic. The Committee is deeply frustrated by the difference between our viewpoint and that of HMT officials: we believe the HMT position is not in line with Ministers’ promises, and we also believe that DHSC and NHSE&I are failing in their duty to protect the sector financially.

PSNC spent time action planning at its meeting last week and we believe, regrettably, that alongside our ongoing private discussions with Government and officials, community pharmacy will increasingly need to go public with its concerns. For PSNC this will focus on two areas: firstly we need to make even more noise to showcase the value of what pharmacies do; and secondly we must publicly hold HMG and NHSE&I to account for their funding decisions and the impact that those can have on patients. This must be an ongoing and cross-sector effort.”



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