Risk & Economy » Audit » FDs predict more time in A&E for NHS finances

FDs predict more time in A&E for NHS finances

The NHS's financial performance continues to nose-dive at an alarming rate

NHS finance directors in England have forecast a weak fiscal pulse in the health service’s finances for this year, in the first research into their financial projections since the 2014/15 year end and the new government taking office.

According to the Healthcare Financial Management Association (HFMA), almost eight out of ten provider trust finance directors expect to be in a worse financial position at the end of 2015/16 than they were in 2014/15, with two thirds forecasting a deficit for the end of this financial year, up by a third compared to the 47% that finished 2014/15 in deficit.

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.

“Add to this the fact that many finance directors don’t feel they have sufficient resources to achieve longer-term financial plans without further cash injections – something the government has made clear is not going to happen beyond the £8bn promised as a result of the Five Year Forward View – and we have a deeply worrying picture. To help with financial planning, we urgently need details on how and when the £8bn will be deployed.”

The figures from HFMA’s latest biannual NHS Financial Temperature Check survey were gleaned from 196 FDs operating in England, representing 47% of provider trusts and 37% of clinical commissioning groups (CCGs). The survey also revealed that most FDs believe the health organisations in their local area have insufficient financial resources to implement the Five Year Forward View, or other long-term financial plans, without additional cash.

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

Briddock said increasing demand for services and an ageing population meant a “transformation of service provision is the key to a sustainable, fit-for-the-future NHS” requiring “short-term investment before long term benefits are realised”.

In contrast to the gloomy picture painted by trust respondents, 83% 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.

CCGs and trusts also report responding to the current financial challenges in quite different ways, with CCGs concentrating on integration, redesigning pathways and investment in community services and trusts prioritising reducing agency costs, procurement cost savings and reducing clinical variation.

Despite maor financial challenges, finance directors in both sectors across the UK are optimistic that quality in the NHS can be maintained at current levels or improved in 2015/16 – 66% believe quality will stay the same, with 26% believing it will improve. Only 8% felt that the quality of services being provided would reduce.

 

Share
Was this article helpful?

Leave a Reply

Subscribe to get your daily business insights