Answers NHS cloze test

NHS deficit last year twice as high as expected, say sources

Likely overspend will bolster calls for 1 ministers to increase funding for health service

2 Hospitals in England ended last year with twice 3 as big a deficit as expected, according 4 to sources, in another illustration of the 5 NHS’s fragile finances.

NHS Improvement (NHSI), the health 6 service’s financial regulator, will reveal the overspend 7 when it releases full details on Thursday 8 of how the NHS performed in 2017-18. Sources close to the publication of the annual health check confirmed NHS trusts ended 2017-18 “about £1bn” 9 in the red.

The likely overspend, double the £496m expected, will 10 fuel claims that the government is underfunding the NHS, given the sharp increase in the number of people needing care.

It would show the health service has been unable to regain the spending discipline the Treasury demanded after years of steadily worsening 11 finances. But critics will blame the deficit on the NHS experiencing the seventh 12 successive year of a budget squeeze and hospitals 13 having to staff thousands of extra beds 14 as a result of the worst winter crisis in its history.

The deficit would be significantly higher 15 than the £791m overspend in 2016-17, but less than the record £2.45bn the NHS ran up in 2015-16.

Jeremy Hunt, the health and social care secretary, is pressing Theresa May to 16 honour her pledge of a long-term finding deal by giving the service a budget increase of between 3% and 4% a year at 17 least until the end of the parliament in 2022.

Simon Stevens, the NHS England chief executive, wants a 10-year commitment to 4% annual 18 rises. However, Philip Hammond, the chancellor, is privately warning that anything 19 above 2.5% is unaffordable.

A report last week from the Institute for Fiscal Studies, the NHS Confederation and the Health Foundation warned people would have to pay more tax in order to give the NHS enough money in the years ahead to ensure it can provide care to an ageing 20 population.

NHS finance experts claimed the health service’s deficit is much 21 worse than the £1bn NHSI will admit to this week, because trusts also received £1.8bn from the sustainability and transformation fund, and £337m to help them cope 22 with extra demand over winter.

Sally Gainsbury, a senior policy analyst at the Nuffield Trust, a thinktank, said: “NHS providers started the financial year 2017/18 with a £4bn black hole between their underlying costs and income that was deepened further 23 over the year.

“So while hospitals and other NHS services did make efficiency savings over the year, the vast bulk of those savings were needed just to stop the black hole getting 24 any deeper. Essentially, services are having to run to just stand still, or 25 even move slightly backwards.

“The real underlying deficit is likely to remain very similar to where it was at the start of the year – at around £4bn, which is inevitable as 26 long as we continue to systematically pay hospitals and other services 27 less than the cost of actually delivering care.”

In March, the public accounts select committee said NHS finances “remain in a perilous state”.

“The NHS is still very much in survival 28 mode, with budgets unable to keep pace 29 with demand. The NHS has a long way to go before it is financially sustainable,” the committee said.

In February, NHSI disclosed that 107 of 136 hospital trusts providing acute care in England were in the 30 red.

Niall Dickson, the chief executive of the NHS Confederation, said: “[Trusts] are at the end of their tether. It’s simply not realistic or reasonable to expect the NHS to go on delivering a comprehensive, universal service with inexorably rising demand and demonstrably inadequate funding.”

He urged ministers to abandon a short-term approach by which the NHS “lurches from budget to budget, with one futile bailout after another”.