NHS trusts currently on track to eliminate provider deficit thanks to hard work at frontline, but risk remains

18 November 2016


NHS Providers welcomed the second quarter financial results which show NHS trusts are well on the way to eliminating the provider sector deficit. This was agreed as a top priority for the NHS in 2016/17 and 2017/18.

The provider sector deficit has grown rapidly over the last four years, as the equivalent quarter two figures for the last four years show: 2012/13 (+£60 million); 2013/14 (-£105 million); 2014/15 (-£630 million); 2015/16 (-£1,616 million).

Figures released by NHS Improvement today show that the quarter two deficit for 2016/17 has dropped to £-648 million. This includes the £900 million released so far from the £1.8 billion of additional ‘sustainability’ support that is being provided to the NHS during 2016/17.

Commenting on the figures, Chris Hopson, chief executive at NHS Providers, said:

“The NHS agreed that eliminating the record financial deficit among NHS trusts was a top priority. There is a well established plan in place and NHS trusts are straining every sinew to deliver it. These figures demonstrate that, thanks to that hard work, good progress is being made.
There is a well established plan in place and NHS trusts are straining every sinew to deliver it

“Last year's deficit was, in reality, around £3.7 billion, and NHS trusts have had to absorb an additional £1 billion pension charge. We welcome the extra £1.8 billion of sustainability and transformation funding support and, as the figures show, NHS trusts have delivered a return significantly beyond that. To be on track for a year end forecast of £-669m at this point is a significant achievement and a tribute to the huge effort that has been put in on the frontline. It also shows what NHS trusts can deliver when they are given a reasonable task and are properly supported.

"The figures also show the challenge of restoring financial balance will grow in the second half of the year. Significant risk remains as NHS trusts will have to increase their rate of savings in the third and fourth quarters to enable the sector to meet the target year-end position of a £580 million deficit.
Significant risk remains as NHS trusts will have to increase their rate of savings in the third and fourth quarters

"Finally, we need to remember that delivering the agreed NHS trust deficit elimination plan is a short term task, which has been enabled by significant extra financial support. The NHS still faces a clear and widening gap between what’s being asked of the service and the funding available. That medium and long term gap still needs to be addressed.”