Tory ministers have been accused of “robbing Peter to pay Paul” after parliament’s spending watchdog branded NHS finances “unsustainable”, warning they could derail the recently announced long-term plan.
In its annual report on the health service, the National Audit Office (NAO) found that by offsetting surpluses and deficits in spending, the NHS was effectively hiding regional differences in finances and patient experience.
The probe revealed that while the health service almost achieved financial balance in 2017/18, NHS trusts racked up a combined deficit of £991m – much of which was accounted for by just 10 trusts.
The government handed out £3.2bn in loans to support trusts unable to afford staff costs and pay suppliers – an increase of almost half a billion on 2016/17. It is a sign “that the underlying financial health in some trusts is getting worse”, the NAO said.
Meanwhile, waiting times continued to slip, with just 88% of A&E patients seen within four hours in 2017/18 against a target of 95%.
According to NAO estimates, it would also cost £700m to reduce waiting lists for non-urgent treatments – up from 2.5 million patients in 2012/13 to 4.1 million – even back to levels seen in March 2018.
However, the watchdog warned that the NHS long-term funding settlement announced by Prime Minister Theresa May earlier this month, which will see an additional £20bn a year pumped into the health service by 2023/24, must not be used to exclusively deal with short-term pressures – a mistake that has been made in the past.
“There is a risk that the extra funding will not be used effectively due to staff shortages as more money may be used to pay expensive agency staff or will go unspent as individual healthcare providers may not be able to recruit the staff to deliver additional activity,” the report read.
It will also be “very difficult to make the NHS sustainable” without a long-term funding settlement for social care, it added.
Shadow health secretary Jonathan Ashworth said Tory ministers were “robbing to Peter to pay Paul by moving money designated for longer-term investment into day-to-day spending”, accusing the Conservative Party of imposing “the biggest cash squeeze in history” on the NHS.
But NAO’s auditor general Amyas Morse went on to call the long-term settlement “a positive and welcome development”, saying that if the funding is spent wisely “we can expect to see a less turbulent financial context than the last few years”.
Meanwhile, an NHS England spokesperson said it agreed with the NAO that the long term plan “is a prudent and practical route-map for improving health and care.”
A spokesperson for the government added: “The long-term plan, backed by a significant funding increase of £20.5 billion a year by 2023/24, rightly sets out that putting the NHS back onto a sustainable financial path is a key priority, and is essential to allowing the NHS to deliver further improvements in care.”