Health leaders' panel survey one: financial health of the NHS and social care

Our first poll was conducted between 3 and 17 June 2014, via an online survey. 78 of our 100 panellists responded. Of the 78 respondents, 38 are senior NHS managers, 21 are clinicians, 11 are from the social care sector, and eight are from local Healthwatch bodies. Of the managers and clinicians, 28 are from acute hospital trusts; 16 from CCGs; six from private or voluntary sector providers; four from acute mental health trusts; three from NHS ambulance trusts; and two from NHS community trusts. The panel members are named on our website, but their individual responses to the survey are anonymised.

Data story

Published: 10/07/2014

Download the survey [PDF 1.5MB]

Key findings

  • 83% said they are concerned about the financial viability of their local provider
  • 70% believe NHS providers will need to go into deficit to provide high-quality services
  • 63% favour tax rises to fund the NHS
  • 63% said spending on social care could save hospitals money
  • 76% said we could achieve more savings without damaging care
  • 35% want additional charges or co-payments


Question one: Do you agree or disagree with the following statement? "I am worried about the financial viability of my local NHS or social care provider(s)"

The NHS has been required to deliver four per cent savings every year since 2010 to meet the pressures it faces. It may need to do so for the rest of this decade, even if overall funding remains steady in real terms. We asked panellists whether they had concerns about the financial viability of their local NHS or social care provider(s) and, more specifically, whether they thought NHS providers would need to go into deficit to continue to provide high-quality services.

Despite the view that more savings could be found in the system generally, there was an overwhelming view that local providers would struggle to meet the financial challenges ahead.

More than four fifths (83 per cent) of respondents had concerns about the financial viability of their local provider.

Question two: "Based on current levels of funding, do you think NHS providers will need to go into deficit in future in order to provide a high quality service?"

More than four fifths (83 per cent) of respondents had concerns about the financial viability of their local provider. Seventy per cent thought that NHS providers would need to go into deficit on the basis of the current level of funding. Their views are a reflection of the state of NHS finances. On the basis of the provisional accounts that have been examined by the Nuffield Trust in a separate analysis (see Into the Red? The state of the NHS’ finances), 66 NHS providers were in deficit in 2013/14, up from 45 in 2012/13. Nearly all are in the acute sector. Overall, NHS providers incurred a small net deficit in 2013/14 – a tipping point in NHS finances, particularly as commissioners found it much harder to balance their budgets.

Question three: "The idea of introducing additional charges for certain NHS services has been suggested as a way to raise income or curb demand. Do you think that further charges or co-payments should be introduced?"

We asked whether additional funds should be raised through increased or new charges, which might also be used to curb demand. More than half (55 per cent) thought charging would not be right, with only a third (35 per cent) agreeing.

We asked those who supported the introduction of new charges what those should be. A range of ideas were suggested, most of them familiar: charging for GP appointments and for missed appointments; for non-urgent A&E attendances; for hospital ‘hotel’ costs; introducing different arrangements for prescription charges, including charging for high cost drugs with limited benefit; introducing charges for those who had played a role in their illness, for example by smoking; and charging for specific services such as IVF or NHS continuing care. However, no real consensus emerged.

Question four: Both the Government and Opposition believe that money can be saved in the acute sector by investing in social care. How realistic do you think this is?

We asked whether the panel supported the idea that greater investment in social care would result in savings in the acute sector. Almost two thirds agreed, with a quarter disagreeing.

Support for the idea was reasonably well spread across all groups. But those from acute hospitals and from HealthWatch formed the core of those disagreeing, suggesting that some work still needs to be done to persuade both the public and those in hospitals that this is a practical proposition.

The government’s Better Care Fund, which will start in 2015/16 with a pooled budget of £3.8 billion, mostly provided by the NHS for investment in social care and community services, is founded on this principle. However, the research evidence for this is limited: the Nuffield Trust’s own evaluations identified few pilot projects based on investment in community services that had succeeded in reducing emergency admissions. However, investment in social care and in Marie Curie services has resulted in reduced spend on hospital services for end-of-life care.

Question five: "Do you think taxes should be raised to fund the NHS?"

We also asked whether extra funds should be raised through taxation. Almost two thirds (63 per cent) supported this. Just under a third of respondents disagreed.

We offered panellists the chance to give their views on the idea of a hypothecated tax, about which there has been recent political and media speculation. Many thought that this is an idea worth pursuing, or at least looking at, recognising that there would need to be a robust debate with the public about funding arrangements. Some also thought extra money would be needed, but the quid pro quo would have to be more radical reform.

Question six: Do you agree or disagree with the following statement? “More efficiencies could be released from the NHS without harming patient care”

On the subject of whether the panel think there is scope for greater efficiencies in the NHS, we asked whether they considered further savings could be delivered across the NHS without harming patient care. Three quarters (76 per cent) thought that there could. Our question did not set a figure on the savings, but, even so, this is a confident response with only 21 per cent disagreeing.

We also asked the panel where they thought savings could best be found in their local area. A range of possibilities was put forward, but popular suggestions were: integrating and rationalising services, with duplication commonly identified as unnecessary; securing earlier discharge from hospital and investing more in community services to reduce bed usage; spending more on prevention and early intervention; and reducing the burden of performance management and regulation.

There was also support for merging organisations to reduce infrastructure costs. More radical proposals on this theme included abandoning the commissioning and contracting model to reduced overhead costs, and introduce more shared decision making or simply a lead provider model with a capitated budget. This was consistent with other suggestions that it would be more profitable to look for savings across organisations rather than within them, but current budgetary and payment arrangements, which focus on individual providers, inhibit this. Greater use of technology was noticeably absent from the list.

Question seven: Do you agree or disagree with the following statement “More efficiencies could be released from my organisation without harming patient care”

We also asked the panel to consider their own organisations and whether they too could find further savings without harming patients or social care users. The overall result was still positive – but much less confident. More than half (54 per cent) considered their organisation could do this, but almost a third (32 per cent) disagreed, and a further 16 per cent were uncertain.

There were differences between organisations. Those from acute and mental health trusts were generally more confident about the possibility of finding savings without harming patient care.

Perhaps not surprisingly, given the cuts that have already taken place, social services panel members were much more evenly divided. So too were commissioners, who have only recently been established on much tighter management cost budgets than those which operated for their predecessors, primary care trusts. However, some respondents representing providers felt that commissioners could be more efficient, for example through merger and greater sharing of back office functions.

Question eight: Do you agree or disagree with the following statements"

The Government has also introduced a much stronger emphasis on competition in the NHS through the Health and Social Care Act, with the aim of increasing the quality of NHS services, and, where prices are not fixed by the tariff (all mental and community health services, but also about a third of hospital services), their efficiency. So we asked the panel whether they thought competition costs the NHS money or whether it resulted in increased efficiency and quality.

Two thirds agreed that competition costs the NHS money, with only 15 per cent disagreeing. Respondents possibly had in mind the upfront tender and bid costs, and also those associated with mergers and acquisitions involving foundation trusts, which are now subject to approval by the Competition and Markets Authority. The issue is whether these costs are a price worth paying for the improvements in efficiency and quality that result. Here respondents were much more evenly divided, with near 50/50 splits on the idea of competition increasing efficiency and quality.

Interestingly, those from mental health and community services were almost all against the idea that competition increased quality and efficiency. These are the areas which have seen most change over the last decade with, for example, about a third of community health services are now supplied by non-NHS providers (see Into the Red? The State of NHS' Finances).


There are some clear themes running through the responses to our questions. Yes, the health and social care system can become more efficient, particularly if organisations work together and release savings across organisations rather than individually. Even if the research evidence is at best ambivalent, spending on social care and community services should produce savings in hospitals, helping with discharging people earlier and preventing admissions for end-of-life care, even if the goal of reducing the number of emergency admissions has so far proved elusive.

There was also support for bringing health and social care budgets together, which would almost certainly result in more organisational change on the commissioner side.

"A single budget is the only answer. Huge expense, time and energy is spent on reaching agreement on expenditure"

Social Services panel member

Some were more radical, arguing for a complete overhaul of the purchaser/provider split.

"The way to improve efficiency and quality whilst controlling cost is to vertically integrate acute, community and primary health care with social care provision under a single organisation and management team"

Acute Trust panel member

Rationalisation and reconfiguration of the provider side was also seen as essential, as was change in primary care.

But panellists are not convinced that this will be enough. The overriding message from questions about the financial future of the NHS and social care was that these health and social care leaders are worried about the short-and long-term finances.

The viability of local providers and the looming and very difficult trade-off between balancing the books and providing a quality service came across strongly in their answers.

The panel was clear that extra money will need to be found for health and social care. The latest figures for NHS finances bear this out. Savings have been made, perhaps at a rate of four per cent or so a year since 2010, but these are becoming more difficult to find – the rate is declining – and increasing numbers of NHS providers are in deficit.

In social services, the budget for older people has been cut by 12 per cent in real terms since 2010 and, as a result, 246,000 people no longer receive domiciliary services.

The NHS and social care are now poorly placed to meet the demands of increasing numbers of very frail old people and those with chronic illnesses; new medical technologies; and rising public expectations. As one panellist put it:

"We have not faced up to having a population that lives great deal longer – we are tinkering around the edges"

Social Services panel member

More generally, the survey findings relating to panellists’ views on the quality of care being provided to patients and service users reflect the policy and funding priorities for health and social care. While NHS spending has held steady in real terms since 2009/10, funding for adult social care has been cut, with older peoples’ services bearing the brunt. However, although the NHS has been to some extent financially protected, there are differences within it. Funding has continued to grow in real terms in the acute sector, although it is under pressure from rising demand, but funding for GP services has fallen, while for mental health it has remained more or less steady.

The national focus on quality has been much greater in the acute sector following the Francis Report and reviews of some acute trusts by Sir Bruce Keogh. For example, the acute sector has seen the fastest growth in nurse staffing, and the programme of NICE (National Institute for Health and Care Excellence) guidance on staffing levels will start with acute hospital wards. There has also been a continuing national focus on hospital acquired infections, waiting times for cancer, elective care and A&E.

In contrast, targets relating to access to GP services have been dropped. There is a national desire for parity of esteem for mental health, but little or nothing that matches the focus on the acute sector.

Turning to the future, our analysis has showed that the NHS in England – depending on a number of different scenarios, including how much funding it receives after 2014/15 – could face a £28-34 billion funding gap by 2021/22.

Our panel considered that how this gap should be met was the first priority for an incoming government. They favoured tax increases over charges, although the latter had some support.

The survey findings call into question the confidence that health and social care leaders have in the long-term sustainability of the NHS, with only half of respondents believing that the NHS will be able to provide a comprehensive service largely free at the point of use in ten years’ time. Therefore, the jury is out on whether the status quo can be maintained in a decade’s time, or whether alternative, and perhaps less palatable, approaches will be needed.

Suggested citation

McKeon A (2014) Health leaders' panel survey one: financial health of the NHS and social care. Nuffield Trust, 10 July 2014.