NHS funding boost has failed to address workforce decline

Despite the £20 billion pledge, trusts are still playing catch up due to previous cuts

Despite the £20 billion anniversary pledge, trusts are still playing catch up due to previous cuts

It was only a year ago that prime minister Theresa May gave the NHS a substantial funding gift for its 70th anniversary. A new £20 billion five-year deal was expected to ‘secure the future of the health service’ and deliver everything from improved performance against waiting time targets to transformation in service delivery.

Sense of concern

But despite this funding boost, a definite sense of concern pervades the King’s Fund’s most recent quarterly monitoring report survey of NHS trust finance directors.

Of those surveyed, 80% thought the NHS would miss the key financial targets that were agreed as part of the funding deal. There was also considerable doubt whether the changes to clinical care, such as reducing the number of face-to-face outpatient appointments, would be delivered over the next five years.

So why then, just one year into this new funding deal, does it feel like anything but a time of plenty in health and care services?

There are two fundamental reasons: there is not enough funding for growth, and funding alone is not enough.  

Unprotected funding

The new funding deal promises annual increases in NHS funding of 3.4%. This is far greater than what the NHS has received annually over the past five years, and would be viewed enviously by other public services that continue to see their budgets cut or remaining unchanged.

But this deal is not a bonanza, and is still less than the 3.7% average annual growth the NHS has made over the past 70 years.

‘Underinvestment in capital budgets over recent years has led to staff increasingly working with unreliable equipment and in unsafe environments’

And crucially, the new NHS funding deal only applies to a narrow definition of health spending – services covered by NHS England’s mandate. This means funding for crucial budgets such as the continuing education and training of the workforce, investment in buildings and equipment, public health services and social care are all unprotected from further cuts or pressures.

These budgets matter. The cost of returning NHS buildings and equipment to their desired state has now reached £6 billion. And the underinvestment in capital budgets over recent years has led to staff increasingly working with unreliable equipment and in unsafe environments. Chronic underinvestment in adult social care has led to patients waiting longer in hospital than is clinically needed, and NHS bed occupancy levels that are now sky-high throughout the year.

Unsurprisingly then, finance directors in our survey gave a high priority to further investment in these areas. In July 2019, the secretary of state for health and social care Matt Hancock described the ‘historical oddity’ of treating budgets for education and training differently to the rest of the NHS England budget. It is entirely in the government’s power to erase this oddity and make good on its commitment to deliver the resources the NHS workforce needs to deliver the ambitions of the NHS Long Term Plan.

Failure to fund growth

So, there is reason to be gloomy because there is not enough funding for the NHS, but that is only part of the story. In the past two to three years it has become increasingly apparent that the factor that most affects our ability to improve care for patients and transform services is not the level of funding but the state of the workforce.

With 40,000 vacant nursing posts and increasing numbers of staff leaving the NHS due to poor work-life balance, we know that not enough new staff members are being trained or recruited and not enough is being done to retain the staff we have. For these reasons, staff morale was the second-highest concern of the finance directors we surveyed.   

But there are some bright green shoots starting to emerge. NHS national bodies are coming together to develop a People Plan that will coordinate workforce planning for the first time in a generation. And more importantly, local organisations are not waiting for permission, guidance or additional funding to take practical steps that could make the NHS a better, more compassionate and flexible employer. Whether that is proposals for free staff car parking at Milton Keynes NHS Foundation Trust, or Guy's and St Thomas' NHS Foundation Trust trying to protect time for staff to have breaks.  

And perhaps it is there – in the actions of local teams and organisations – that we should look for hope.

Supporting progress

Policy analysts like me often talk about workforce pressures as the ‘rate-limiting factor’ for service improvement; something that will restrict the speed of progress. Perhaps a better way to think about the workforce is as the growth factor for any significant improvement in patient care that the NHS hopes to deliver.

But unless national and local leaders embrace this reality, and provide the resources and support the NHS workforce needs, patients will face a long wait before they see the improvements in care the NHS’s anniversary funding boost promised.

Siva Anandaciva is chief analyst at the King’s Fund


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