NHS England chief warns against poor spending review deal

Harroon Siddique and Dennis Campbell report in The Guardian 11th November 2015: NHS England chief warns against poor spending review deal -Simon Stevens hopes for ‘considerably more progress’ in negotiations with Treasury to front-load extra cash and ease pressure on health service

The chief executive of NHS England, Simon Stevens, has said the government spending review may leave the health service without a workable funding settlement.

Stevens said negotiations were still taking place but the NHS would be on rocky ground if things did not change before George Osborne’s announcement this month.

In an interview with the Health Service Journal (HSJ), Stevens said: “As of today, considerably more progress is going to be needed before we can say we have a genuinely workable NHS funding solution for 2016-17 and 2017-18, but spending reviews usually come down to the wire, so hopefully we’ll get there by 25 November.”

Stevens set out five “tests” last month for whether the spending review would meet the NHS’s needs. These included continuing political support for realistic NHS efficiency improvements and investment and funding protection for social care services.

He told the HSJ: “I cannot confidently tell you today that we yet have a clear line of sight to those five tests being met [by the spending review].”

The government has committed to increasing NHS spending by £8bn by 2020 but has not set out an investment timetable. Stevens said the increase must be front-loaded, with sufficient funding at the beginning of the parliament, to help manage current pressures and facilitate redesign of the service.

He said: “For the NHS, next year and the year after are where the rubber will really hit the road. The Forward View [his blueprint on the future of the NHS] maths was explicit that the health service needed front-loaded investment in 2016-17 and 2017-18 to manage current pressures, kickstart service redesign and unleash major savings later in the parliament.”

His comments were published on the same day it was announced that the Treasury and the transport, environment and local government departments had become the first ministries to agree on cuts in the spending review, which is intent on slashing £20bn from the cost of government.

Stevens’s intervention is notable because it is the first time that he has made the argument for greater NHS funding as soon as possible in such a public way and before such a key government announcement. It is thought to reflect acute concern among NHS England’s top brass that Osborne will give the NHS far less than the amount they think they need to keep the service working.

Health is protected but there has been pressure for the NHS to get emergency funding in the spending review, given that the service is on course for an annual deficit of at least £2bn, described by regulators as the NHS’s worst financial crisis in a generation.

Additionally, there are fears that the NHS could be put under immense strain by cuts to social care services, which will be inevitable as a result of the local government settlement.

Stevens called for “a realistic and deliverable” national tariff payment system for next year (2016-17). The tariffs have been cut by about 4% a year in real terms over the past five years in an attempt to improve efficiencies within the NHS, but he said he would prefer a cut for next year that starts “with a 2[%] not a 3[%]”.

Further ratcheting up the pressure on Osborne, the former Conservative health secretary Stephen Dorrell, now chairman of the NHS Confederation, urged the chancellor to give the health service a “transformation fund” that it could use to create new services outside hospitals.

He does not say how much the fund should be but health thinktanks have suggested at least £1bn is needed to transform the NHS and help it cope with the growing pressure.

“Failure to do so will guarantee continuing service inefficiency – and with it avoidable illness and service pressures,” he writes in a letter to the chancellor.

Dorrell warns Osborne not to try to find more money for the NHS frontline by cutting the budgets for workforce, training and research – options that Treasury officials have been exploring. He also issues a thinly veiled criticism of Osborne’s recent decision to cut the public health budget in England by £200m, a move that could undermine the transformation of the NHS and add to the growing burden of illness because it takes money away from vital health prevention work.

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About Roger Burns - retired GP

I am a retired GP and medical educator. I have supported patient participation throughout my career, and my practice, St Thomas; Surgery, has had a longstanding and active Patient Participation Group (PPG). I support the idea of Community Health Councils, although I feel they should be funded at arms length from government. I have taught GP trainees for 30 years, and been a Programme Director for GP training in Pembrokeshire 20 years. I served on the Pembrokeshire LHG and LHB for a total of 10 years. I completed an MBA in 1996, and I along with most others, never had an exit interview from any job in the NHS! I completed an MBA in 1996, and was a runner up for the Adam Smith prize for economy and efficiency in government in that year. This was owing to a suggestion (St Thomas' Mutual) that practices had incentives for saving by being allowed to buy rationed out services in the following year.

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