Health Foundation responds to NHS provider deficit of £2.3bn

Responding to the news announced today by Monitor that the NHS provider deficit has grown to £2.3bn at the end of the third quarter  (2015/16) and is expected to reach £2.8bn by the end of the financial year, Adam Roberts, Head of Economics at the Health Foundation, said:

'The state of NHS finances is deteriorating at an alarming rate. These figures are beyond dire and are particularly bad for acute hospitals, with 95% in the red.

'The NHS’s reliance on agency staff is one of the key factors driving up the deficit. The NHS spent over a billion more than planned on agency staff, totalling £2.7bn in the first nine months of the year. This is expected to rise to around £3.5bn by the end of the year.

'Monitor and the TDA have introduced new rules on the use of agency staff, including a cap on agency nurse spend. But this fails to address the real issue driving agency spend - poor workforce planning.  The reality is there are just not enough nurses and alarmingly the number of training places has fallen over the last decade, as evidenced by the NAO’s recent report.  Within this context greater reliance on agency staff is not only understandable, it is essential for many NHS trusts trying to ensure safe staffing levels.

'The NHS is struggling to meet national targets to treat patients in A&E and with suspected cancer, and in December missed the access target for elective operations for the first time.  With such substantial deficits there is limited resource for providers to reverse these worrying trends.

'A comprehensive national plan is urgently needed, over and above the existing local sustainability plans, to support providers to achieve financial balance and address these complex challenges.'

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