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NHS trust providers’ deficit reaches £930m

78% of NHS trusts are in deficit

Adrian O'Dowd

Friday, 09 October 2015

NHS trusts including foundation trusts are almost a billion pounds in the red with their collective deficit reaching £930m at the end of June, show new figures published today from NHS regulators.

Monitor and the NHS Trust Development Authority (TDA) published figures for the financial quarter of April to June of this year, revealing the growing cash problems that were leading to missed waiting times targets.

Monitor’s analysis of trusts’ performance between April and June showed that for the second successive financial year, England’s 151 foundation trusts recorded a deficit of £445m in the first quarter, which was £90m worse than planned.

The NHS Trust Development Authority also published figures showing the overarching financial position of NHS trusts for the same period, showing that the NHS trust sector’s 90 trusts ended the first quarter of the year £485 million in deficit against an initial planned deficit of £412 million.

Monitor said many foundation trusts cited higher than expected pay costs as the cause for their financial troubles, such as over-relying on expensive agency staff.

The consequences of deficit in the foundation trust sector was trusts were missing a number of national waiting times targets, including in A&E, for routine operations and some cancer treatments.

Trusts also struggled to deal with an increase in demand for diagnostic tests, partly due to staff shortages and ineffectively organised services.

Monitor said foundation trusts were providing the widest ever range of services to patients, but warned that they needed to continue to improve how they operated if they were to deal with increased demand for care and a “worst in a generation” financial position.

Dr David Bennett, chief executive at Monitor, said: “Trusts are working hard to provide patients with quality care. However, today’s figures reiterate that the sector is under massive pressure and must change to counter it.

“The NHS simply can no longer afford operationally and financially to operate in the way it has been and must act now to deliver the substantial efficiency gains required to ensure patients get the services they need.”

Monitor’s figures showed:

  • 118 foundation trusts (78%) ended the April to June period in deficit
  • trusts made £232m worth of cost savings which was £64m less than planned
  • the size of the waiting list for routine operations reached 1.9m, an 169,100 increase on the same period for 2014-15.

The TDA said the financial position of NHS trusts reflected a number of pressures on providers, some of the most significant being:

  • higher than planned levels of agency staffing paid for at premium rates to meet rise in demand and as a response to the  heightened focus on service quality
  • a reduction in the level of income expected by NHS trusts compared with that received last year.

BMA representative body chair Dr Ian Wilson said: “These figures are staggering. The NHS is facing a funding crisis the likes of which we have never seen. Despite what politicians claim, NHS funding has not kept up with rising patient demand and the increased cost of delivering care.

“With winter just around the corner, there is a real risk to the quality of patient care as pressure on services and staff will only intensify. The government must wake up and take action."

The NHS Confederation’s senior economics advisor Paul Healy said: “The billion pound NHS deficit now forecasted for foundation trusts is a symptom of problems across the entire health and social care system and we agree with Monitor that radical change must happen.

“Unfortunately financial planning in the NHS leaves the health service navigating in the dark without knowledge of how much funding will be available in six month’s time.”

Think tank the Nuffield Trust’s chief executive Nigel Edwards said: “Today’s figures show that deficit has become the ‘new normal’ for the NHS. With 79% of trusts in the red, the outlook for breaking even by the end of this financial year is bleak.”

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