26.11.14
Deficit crisis ‘must be addressed’ with urgent £2bn cash injection
An NHS financial crisis is “inevitable” in the next financial year without new money, according to the King’s Fund analysis. The health think tank is urging the government to add £2bn to the 2015-16 budget for the NHS or “patients will bear the cost” – with deteriorating care and higher waiting times as staff numbers shrink.
Provider trusts are already in deficit by £630m, halfway through the year, the King’s Fund notes. Monitor’s figures published this week forecast a net deficit in the foundation trust sector alone of £271m, with deficits bigger and surpluses smaller than expected, and the NHS Trust Development Authority last week published similarly poor figures for the non-FT sector.
Key NHS targets are already “being breached on a regular basis”, the think tank says, while the financial situation is being exacerbated by a real-terms budget increase of just 0.2% and the cash being siphoned off for the Better Care Fund.
Drawing on its ‘NHS Productivity Challenge’ research published in May and the most recent figures, the King’s Fund notes that the funding squeeze is being made more difficult by the high costs of implementing quality and safety reforms in the wake of the Francis report. The pressure is not confined to the hospital sector: general practice and mental health have also spent recent months warning of their own funding crises.
The King’s Fund’s new briefing also urges the creation of a ‘transformation fund’ to meet transition costs – widely seen as a flaw with the Better Care Fund, and echoing similar calls made by the NHS Confederation.
Chris Ham, chief executive of the King's Fund, said: “There is scope to improve productivity in the NHS, but this will not be enough to respond to unprecedented pressures on budgets and meet rising demand for services. Recent pledges from the main political parties to increase funding are welcome but it is clear that none of them have yet addressed the scale or the urgency of the financial challenge facing the NHS.
“With deficit reduction still a high priority, finding an additional £2bn in the Autumn Statement is a very big ask. However, unless more money is found, a financial crisis is inevitable next year and patients will bear the cost as waiting times rise and quality of care deteriorates.”
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