We must have an efficient system for accessing and spending capital
05 February 2020
- The National Audit Office (NAO) has found that NHS trusts reported a combined deficit of £827m and clinical commissioning groups (CCGs) a £150m deficit in the financial year ending 31 March 2019.
- It said extra money provided by the government to stabilise the finances of individual NHS bodies had not been fully effective and trusts in financial difficulty were increasingly relying on short-term loans from the Department of Health and Social Care.
- One NAO report looked at the finances of the NHS as a whole and the financial performance of individual NHS organisations.
- A second examined the NHS' capital budget, which is for replacing and maintaining equipment and buildings.
Commenting on the NAO's review of capital expenditure in the NHS, deputy chief executive Saffron Cordery said:
"This is a comprehensive review that supports what we have been calling for through our ongoing 'Rebuild our NHS' campaign. It calls for an efficient system for accessing and spending capital; a multi-year capital settlement and highlights the gulf between the capital budget in England compared to other OECD countries.
"It is clear that there is now a widely held view that reform is needed and we have a capital system starved of funding that is failing to meet the needs of a modern health service and most importantly the patients being cared for. It shows why reform is needed.
"In its review the NAO has reached many of the same conclusions as us including the increasing risk of harm to patients as a result of growing backlog maintenance; trusts' assessment that their need for capital funding is greater than the funding available and that the system for accessing funding does not necessarily ensure it is made available where the need is greatest or most urgent.
"We will continue to call for the government to make significant changes to the capital strategy as the current system of bidding, prioritisation, allocation and approval desperately needs to change."
Commenting on the NAO's report into NHS financial management and sustainability, NHS Providers deputy chief executive Saffron Cordery said:
"This confirms what trusts have been telling us for some time, that despite the government’s welcome funding uplift to deliver the long term plan, they are still operating within significant financial constraints particularly as demand continues to rise at a pace outstripping current resource increases. They are also working within a regulatory framework that needs urgent reform by the government and NHS England and NHS Improvement.
"The NAO makes it clear that the current approach to funding the NHS needs to be reviewed and we are working with NHS England and NHS Improvement to ensure providers are engaged on many of their proposed reforms as we move to system working and collaboration."