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Nearly two-thirds of provider FDs forecasting 2015-16 deficit

Almost two-thirds of NHS finance directors are forecasting a deficit for the end of this financial year, up by a third compared to the 47% that finished 2014-15 in deficit, new figures have revealed. 

The data from the Healthcare Financial Management Association’s (HFMA’s) latest biannual NHS Financial Temperature Check survey also highlighted that 78% of provider trust finance directors expect to be in a worse financial position at the end of 2015-16 than they were last year. 

HFMA surveyed 196 finance directors in England, representing 47% of provider trusts and 37% of clinical commissioning groups (CCGs), and it was revealed that more than 90% didn’t feel their health organisations have sufficient financial resources available to implement the Five Year Forward View, or other long-term financial plans. 

However, 85% of trust finance directors and 96% from CCGs overwhelmingly agree that their organisation’s stability depends upon working jointly with other organisations.

In contrast to providers, more than 80% of CCG CFOs expect a surplus at the end of this financial year and 50% expect to be in a similar or better position than they were at the end of 2014-15 by the end of 2015-16.

Paul Briddock, director of policy at the HFMA, said: “The NHS’s financial performance continues to nose-dive at an alarming rate. Our members have told us 2015-16 is looking even worse than last year, with increasing numbers expecting to end the year in the red.” 

Risk associated with achieving the 2015-16 plans were assessed as high or medium, with only 16% of CCG and 10% of provider finance directors rating risk as low. Key risks to achieving plans included slippage in cost savings (74%), increased demand (64%), emergency activity (55%) and spending on agency staff (50%). 

Responding to the report, Rob Webster, chief executive on the NHS Confederation, said: “Concern about NHS finances are clear to see and these results echo what our members recently told us in our survey of NHS leaders. 

“Building confidence in future NHS finances will need certainty on funding, so our members can focus their attention on the bigger challenge of changing how care is delivered to be high quality and sustainable.” 

He added that chancellor has an opportunity to address this issue in his budget next Wednesday and begin the important discussion on NHS funding for this Parliament, as part of the broader spending review. 

Chris Hopson, CEO of NHS Providers, stated that the latest analysis shows a “continued trend” of pressure faced by NHS providers of all sectors but also a strong understanding by finance directors of the challenges ahead to maintain and transform health and care services. 

“In 2015-16, 63% of trusts are forecasting a deficit versus 83% of CCGs forecasting a surplus – the CCG forecast net surplus is clearly not going to be sufficient to cover the net deficit projected in the provider sector,” he said. 

“Although there is a clear message that provider finance directors continue to prioritise quality of services, there is need for a credible plan on what the expectations of performance from providers can realistically be without harming patient care, within the available financial envelope.” 

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