“These figures show providers on track to overshoot their target of a £580 million deficit for the year by over half a billion (£1.1 billion) [1], even after receiving an extra £1.8 billion in emergency funding.
"As we warned would happen, the NHS now appears to be locked into systematic overspending – a function of the simple fact that funding is rising significantly more slowly than patient numbers."
“This massive deficit comes even though NHS trusts have delivered very high levels of cost cutting: £2.9 billion in the first nine months of this financial year alone. Providers are being asked to make these cost cuts more than 50 per cent faster than recent reviews for the government have found possible [2]. So it is little wonder that key targets such as A&E and operation waiting times are suffering.
“As we warned would happen, the NHS now appears to be locked into systematic overspending – a function of the simple fact that funding is rising significantly more slowly than patient numbers. If this continues, we have calculated that by next year all parts of the service will be in deficit [3]. There is a widening gap between what we are asking the NHS to do and what we are funding it to do.”
Notes to editors
- These figures show that providers have been overspending at a rate of £239m per month from October to December 2016. If this continues, there will be an underlying deficit of £2.9bn by the end of the year, or £1.1bn once extra money from the Sustainability and Transformation Fund is taken into account. This would in fact still be an improvement on last year’s underlying deficit of £3.7bn.
- Lord Carter’s wide-ranging review last year of how NHS trusts could become more productive found opportunities for savings of around 2% per year.
- Our Feeling the Crunch report estimated that by 2018/19 financial year, NHS commissioners as well as providers will be in deficit.