NHS set to miss £20 billion savings target

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The NHS will struggle to meet its target of delivering £20 billion in productivity improvements by 2015 according to The King's Fund's latest quarterly monitoring report.

Only 1 in 10 (10 per cent) of NHS finance directors surveyed for the report rated the chances of meeting the target as better than 50/50. The majority (56 per cent) identified a high or very high risk that the target will not be met, while a third (34 per cent) rated the likelihood of success as 50/50.

The survey – which this quarter includes finance leads from clinical commissioning groups (CCGs) as well as trust finance directors – highlights the growing pressures on NHS providers. Only a third (33 per cent) of trusts surveyed expect to meet their cost improvement targets for 2013/14 – a sharp fall on the same quarter last year when nearly three-quarters were confident of meeting their targets. Commissioners are more optimistic, with 72 per cent of CCG finance leads expecting to meet their organisation’s targets.

Analysis of NHS performance data for the first quarter of 2013/14 shows most indicators are broadly stable, although A&E waiting times remain comparatively high. Over the quarter, 241,000 patients (4.3 per cent) spent four hours or more in A&E; although this is back within target range, it is the highest level for this quarter since 2004. With 61 hospitals breaching the government’s target, this reinforces the challenge the NHS faces in managing pressures in A&E over the coming winter, despite the new funding announced last week by the Secretary of State.

Other key findings from the analysis of NHS performance data include:

  • the number of health care-acquired infections continues to fall, with 398 cases of C difficile and 24 counts of MRSA recorded in June 2013
  • waiting times for hospital treatment remain stable, although the median waiting time for outpatients has crept up to more than five weeks, its highest level since January 2008
  • the proportion of patients waiting more than four hours to be admitted from A&E to hospital (‘trolley waits’) fell back to 4.5 per cent in the last quarter but remains high by recent historical standards
  • the number of delayed transfers of care remains stable, with 3,999 delayed discharges recorded in June.

The survey of trust finance directors and CCG finance leads also found that:

  • the vast majority (89 per cent) expect their organisation to be in surplus or to break even in 2013/14, with 11 per cent expecting to be in deficit
  • nearly a third (31 per cent) said patient care in their area had got worse over the past year, compared to 14 per cent who said it had improved and 55 per cent who said it had stayed the same
  • nearly three-quarters (72 per cent) were pessimistic about the prospects for their local health economy over the next 12 months and only 10 per cent optimistic about this.

Professor John Appleby, Chief Economist at The King's Fund said: 'The findings from our survey of finance directors have become significantly more pessimistic over the past 12 months, reflecting the growing pressures on the NHS. Now just over half way through the so-called Nicholson Challenge, it is clear the NHS will struggle to meet its £20 billion productivity target, with potentially serious consequences for patient care. The reality for many hospitals is that they face an uncomfortable choice between whether to prioritise the quality of services for patients or allow performance in some areas to slip in order to balance the books.'

Notes to editors

How is the health and social care system performing? is the ninth of The King's Fund's regular quarterly monitoring reports. For further information or to request an interview with John Appleby, please contact the Press and Public Affairs team on 020 7307 2585 (if calling out of hours, please ring 07584 146035).

The surveys of NHS trust finance directors and CCG finance leads were carried out online between 11 July 2013 and 25 July 2013. We contacted 136 trust finance directors, of whom 42 responded. Of 100 CCG finance leads contacted, 29 responded. We also contacted 152 directors of adult social services, of whom 22 responded. The survey aims to provide a snapshot of opinion and is not intended to be a representative sample.

The King's Fund is an independent charity working to improve health and health care in England. We help to shape policy and practice through research and analysis; develop individuals, teams and organisations; promote understanding of the health and social care system; and bring people together to learn, share knowledge and debate. Our vision is that the best possible care is available to all.