NHS issued seven-point plan to ‘reset’ finances


Giving trusts an extra £1.8bn, agreeing 'financial control totals', and introducing new intervention regimes are among measures to stabilises NHS finances set out in a seven-point plan on Thursday (21 July).

Issued by NHS England and NHS Improvement, the plan labelled a financial ‘reset’– outlines action to “dramatically cut the annual trust deficit and sharpen the accountability of trusts and clinical commissioning groups” so they remain in the black.

It includes measures to replace national fines with trust-specific incentives, publish performance ratings for clinical commissioning groups, and set new controls to cap the cost of interim managers.

“This is a serious moment for the NHS,” the head of the NHS Confederation said on Thursday.

The plan at a glance

The wide-ranging plan, trailed at the NHS Confederation annual conference in June, includes:

  • allocating an extra £1.8 billion to trusts, with the aim set by NHS Improvement of cutting the combined provider deficit to around £250 million in 2016/17. It also has the ambition that, in aggregate, the provider position commences 2017/18 in run-rate balance
  • replacing national fines with trust-specific incentives linked to agreed organisation-specific published performance improvement trajectories, so as to kickstart a multi-year recovery and redesign of A&E and elective care 
  • agreeing 'financial control totals' with individual trusts and CCGs, which represent the minimum level of financial performance, against which their boards, governing bodies and chief executives must deliver in 2016/17, and for which they will be held directly accountable
  • introducing new intervention regimes of special measures which will be applied to both trusts and CCGs who are not meeting their financial commitments
  • setting new controls to cap the cost of interim managers and to fast track savings from back office, pathology and temporary staffing
  • publishing the 2015/16 performance ratings for CCGs 
  • launching a two-year NHS planning and contracting round for 2017/18-2018/19, to be completed by December 2016, and linked to agreed sustainability and transformation plans.
It represents the financial plans NHS England and NHS Improvement require every trust and CCG to deliver as a minimum.

Confederation chief executive, Stephen Dalton, said: “We recognise the importance of financial rigour, however, it should be recognised that the service has already made unprecedented savings in hugely challenging circumstances. 

“The uncertainty following the Brexit vote is likely to compound financial concerns.

“Now is an important time for the government and national bodies to assure NHS leaders that a focus on stability does not come at the expense of transformation. 

“This is critical to improve care for patients at a local level and will ultimately deliver sustainability for the future.”

Cross-governmental review needed

The head of NHS Clinical Commissioners, Julie Wood, said: “Both commissioners and providers alike, are facing multiple challenges, including increasing demand for services and additional expectations being placed on them by the centre to deliver more at pace – this has had a direct knock-on effect for CCGs finances where, for the first time many more CCGs are struggling to balance the books. 

“The decline in CCG finances is something we have previously given warnings on, with the allocative growth in the 2016/17 funding cycle having already being committed to existing or announced projects or funding streams.  

“The simple truth is there is no spare money in the system – we urgently need a cross-governmental review into the overall financial position of the NHS and an open debate about what can be realistically delivered with the current level of funding.”

View the full statement.

Simon Stevens at #Confed2016

See what the head of NHS England had to say about NHS finances at the NHS Confederation annual conference and exhibition in June.

Find out more

Access Strengthening financial performance and accountability in 2016/17  from the NHS Improvement website.

Find out how the NHS Confederation is supporting members around NHS finances and funding.

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