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PAC: Recovery plan for STP areas in ‘severe financial difficulty’ needed by March

A new report by the Commons Public Accounts Committee (PAC) has set out a number of urgent recommendations for the NHS, including the need for the government to set out a “transparent and clear” transformation plan that will make the public feel confident that STPs aren’t just being a “cover for cuts in service”.

The committee also recommended that by March this year, NHS England and NHS Improvement (NHSI) should set out how they will support organisations to deliver real transformation in the areas where plans fall short in order to convince the public of the benefits that STPs offer.

Separately, the report called on NHS England, the Department of Health (DH) and central government to work together and set out a transparent recovery plan to halt the decline of health and social care in the UK, warning of the damage that “repeated raids” of investment funds are having on the NHS.

Key to the PAC’s recommendation is the government setting out a “clear and transparent recovery plan” that will target and support NHS bodies and health economies.

The review once again warned that financial pressure being placed on social care was proving to be detrimental for NHS care providers, arguing that a full review into this issue should be completed by July 2017, as reported by NHE’s sister title Public Sector Executive.

MPs in the committee also raised concern that the consequences of plans to plug the £22bn black hole in NHS finances were still not fully understood by the DH, NHS England and NHSI, and that local bodies were being asked to do too much with already-stretched budgets.

Meg Hillier MP, chair of the PAC, said: “The NHS as we know it is under threat from growing and unsustainable financial pressures. Few trusts feel they have a credible plan for meeting the financial targets they have been set by government.

“At the same time, the government seems unable to get its own house in order – plundering NHS investment funds to plug holes elsewhere, and falling out in public over its longer-term strategy.

“Contradictory statements about funding from the prime minister and head of NHS England are an insult to taxpayers who deserve an honest, grown-up conversation about future finance and service provision.”

Hillier also described the government’s short-term “sticking plaster” approach to fixing the NHS as unsustainable, arguing that this strategy “represents neither good value to taxpayers nor the best interests of patients”.

Much-needed reality check

NHS Providers chief executive Chris Hopson praised the report for showing the “gravity of the challenges facing the NHS”, adding: “It’s the latest in a long line of independent reports to conclude the financial situation is unsustainable. It is a chastening and much-needed reality check.

“The committee is right to conclude that the financial situation in the NHS is not sustainable. We have argued consistently that there is a growing gap between what the health service is expected to deliver and the money to pay for it. This is making it harder to provide the quality and access to care we all want to see, and that patients deserve.”

He went on to say: “NHS staff are working flat out under enormous pressure. Trusts are treating more patients than ever, and pioneering new ways of working. Trusts know that efficiencies do need to be made and are working hard to do all they can on this front but without additional funding the expectations placed on the service are unrealistic.”

Hopson added that PAC was right to highlight the damaging impact that cuts to capital budgets were having, as money put aside for new buildings and technologies is being injected into funding day-to-day activities instead.

“This will compromise the health service’s ability to adapt to future demands. We share its concerns over progress towards achieving credible STPs that will deliver the desired transformation of services with public support,” he said.

Responding to the report, the DH said: “We are united behind the ambition to make the NHS the safest, highest-quality healthcare system in the world – which also means ensuring financial sustainability for the future, and the hospital sector's financial position has now improved by £1.3bn compared to this time last year, with 44 fewer trusts in deficit.”

But the PAC report had argued that although there has been progress in reducing the deficit in 2016-17, the extra £1.8bn bailout fund that trusts have received “has not yet eliminated” their deficit as planned.

“Specifically, in some STP areas, organisations with stronger finances have been grouped with those that are struggling, with the risk that some organisations may have to bail out others,” added the report.

The report comes on the same day that PAC opened an inquiry into health and social care integration and the progress of the Better Care Fund, and how effective the policy is likely to be as a solution to the crisis that health and social care currently finds itself in. The inquiry closely follows a similar investigation by the National Audit Office, which concluded that there is no compelling evidence that health and care integration really does work.

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