Health Foundation response to Public Accounts Committee report on financial sustainability of NHS bodies

In anticipation of the Public Accounts Committee report on the financial sustainability of NHS bodies (due to be published 3 February 2015), Anita Charlesworth, Chief Economist at the Health Foundation, comments:

‘The NHS is showing increasing signs of financial distress. The number of NHS providers reporting a deficit doubled between 2012/13 and 2013/14, with 66 trusts in deficit in 2013/14. Halfway through the current year, four in five hospitals can’t balance their books and in December the Treasury had to increase health funding for this year and next.

‘The challenge of financial sustainability will be an issue which dominates the next parliament. NHS England argue that, by implementing its Five year forward view, the NHS could deliver productivity improvements in the range of 2-3% a year and reduce the additional funding requirement to £8bn in 2020/21 over and above inflation.

‘Although the NHS in England delivered productivity improvements of just over 2% a year for the first two years of the current parliament, maintaining productivity growth at this rate to 2020/21 would be unprecedented. Our analysis suggests that £8bn is likely to be the minimum amount needed to maintain the quality and range of NHS services over the next parliament.

‘The Health Foundation is calling for the incoming government to: establish and resource a ‘transformation fund’ to provide the financial assistance necessary to underpin change; and to commit further annual funding for the NHS above what has already been identified.’

For more information, see our briefing on NHS finances.

Media contact

Mike Findlay, Media Manager
T: 020 7257 8047
E: mike.findlay@health.org.uk