Anita Charlesworth, Director of Research and Economics at the Health Foundation, said:

'It is clear that NHS has systemic problems. Crucially, poor workforce planning in recent years has made it harder to fill vacancies, increasing the reliance on contract and agency staff. The NAO report acknowledges that agency spending has slowed, but warns it could take years to address the underlying problems of poor staff planning.

'Health Foundation modelling provides similar estimates for the scale of the financial challenge by 2020/21. Although the NHS has delivered productivity improvements, we reiterate that fully closing the gap requires a substantial improvement in the rate of efficiency growth. This may be achievable, but only with dedicated investment in change, along with a coherent plan, which the NAO highlights does not currently exist.

'The deficits from NHS providers would have been larger without regular transfers from the NHS capital budget to fund front line services in recent years. However, the NAO warns that there has been insufficient assessment of the long-term effects of this strategy. The impacts of underinvestment in capital may not be immediately obvious, but could result in substantially higher costs in the future.

'The pressures facing our hospitals are exacerbated by the severe capacity shortages in the social care system. A comprehensive strategy to improve NHS efficiency is necessary but not sufficient for a sustainable health service. As an urgent priority, pressures in the social care system must be addressed in the Autumn Statement.'

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