NHS leaders in England are facing tough choices on which services to cut unless extra funding is provided by the Government to cover the rising costs of industrial action and other cost pressures.
NHS leaders across hospital and other services in England have told the NHS Confederation that the health service is facing a profound financial crisis due to the ongoing impact of strike action and other factors such as higher drug prices and continuing healthcare costs. Strike action alone is estimated to have already cost the English NHS £1.4 billion and those costs are set to increase with further strikes expected this winter.
Many leaders have told the NHS Confederation that they are already starting to make tough decisions based on the expectation that they will need to cut costs further without rapid clarity and certainty.
This includes having to restrict the number of extra beds that they open this winter to deal with expected higher demand for care. The NHS’ winter plan centres on 5,000 more beds being available, but this is now in jeopardy due to rising deficits across the NHS. With most NHS hospitals running at high bed occupancy levels, this will reduce vital capacity just as the health service enters its busiest time of the year.
Another consequence will be progress on waiting lists, with NHS leaders warning that the Prime Minister’s pledge to reduce the size of the waiting list by March 2024 is almost certain to be missed. The waiting list was 7.2 million when the Prime Minister made the pledge in January 2023, but it now stands at almost 7.75 million and is increasing by around 100,000 people per month.
NHS Confederation chief executive Matthew Taylor said:
“Everyone from the health secretary to the chief executive of the smallest trust knows that the government needs to make an urgent decision on whether to cover the unplanned costs of strike action and other higher costs.
“NHS leaders tell me that they are already having to take difficult choices every day on which services to cut back as they are not expecting any extra money to make up for the shortfall caused by the strikes, higher drug prices and pay costs being higher than the funding allocated at the start of the year. This will make an already difficult winter even harder to get through and we need the government to face up to this risk.
“Every day that passes without clarity on this issue results in more uncertainty and tough decisions having to be made.
“The irony is that while NHS leaders share the heath secretary’s ambitions to increase productivity in the health service, the strikes are acting as a handbrake on these ambitions as NHS staff are having to spend too much time cancelling and rearranging operations and outpatient appointments.
“This is not a trade-off between the economy and the NHS – as a growing body of research, including by the NHS Confederation itself, has shown gaps in health and care have their own economic impact in terms of people being unable to seek or sustain employment.”
The financial challenge is also shared by the NHS Confederation’s members in Wales as a result of inflation and increased demand and acuity of patients, with the NHS in Wales heading for a deficit of £650 million. Last week the Treasury in Wales gave a long-awaited statement on the Welsh Government’s financial position, including significant savings to the budget in several departments, prioritising protection of the Welsh NHS to the tune of £425m of ‘additional funding’. However, the £425 million is significantly less than the overall forecasted deficit and the Welsh Government recognises that the NHS in Wales still faces some extremely difficult decisions due to the challenging financial position.
This financial context is replicated in Northern Ireland with a short fall this year estimated to be around £550m. The situation is exacerbated with continued lack of a devolved assembly and a wider long term concern that the current funding formula is not keeping pace with the levels of need in Northern Ireland.