NHS financial state remains ‘perilous’, concludes PAC

The financial position of the NHS remains in a perilous state, largely because of the continued focus on short-term fixes, concludes a new report by the Public Accounts Committee (PAC).

Despite a rescue fund worth £1.8 billion in 2016/17, the NHS is still very much in survival mode, with budgets unable to keep pace with demand, MPs said.

"The Department of Health and Social Care, NHS England and NHS Improvement are too focused on propping up the system and balancing the books in the short term and have not paid enough attention on transforming and improving patient services in the long term," according to the Committee.

With trusts forecasting a deficit of over £900 million in 2017/18, the NHS "still has a long way to go before it is financially sustainable," it noted, and said it is disappointed that "the Department’s lack of action means we have to repeat some of the same messages as our previous reports on the dangers of short-term measures used to balance the NHS budget and the risks of raiding investment funds to meet day-to-day spending".

The PAC also highlighted that the Department has not yet assessed the impact on patients or services "of repeatedly raiding its capital budget to fund the short-term needs of the NHS", and that, while local bodies are setting up new integrated care systems under the sustainability and transformation banner,  "witnesses could not clearly explain how accountability within these systems will work in practice or how they will improve the care that patients receive."

The new integrated care systems aim to bring together the budgets, functions and care offered by the organisations involved in the interests of the patient, and so "it is worrying that NHS England and NHS Improvement could not clearly explain how this will sit alongside each organisation’s existing responsibilities," the report stressed.

"Our committee has repeatedly called for a long-term plan for the NHS and by July we expect the Department for Health and Social Care to explain in detail exactly how it is approaching this task," said PAC chair, Meg Hillier MP. "Key to this will be securing a funding settlement from the Treasury that properly reflects current and anticipated demand for NHS services.

"It remains unclear how local partnerships, set up to develop strategy and help to transform services, will be held to account for their performance. This must be addressed," she stressed.

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