Recovery Watch: ‘We’re in a right hole’

Back to school with a tricky term ahead

Wes Streeting’s appearance at a meeting of NHS CEOs last week was widely welcomed as a sign he wants to work constructively with NHS management.

But despite the positive optics, a cold look at the substance of what he had to say is far less pleasing.

He confirmed there is to be no in-year funding boost, something many leaders were pinning their hopes on, and which, if seen through, will mean painful cuts in the months to come.

The NHS England-hosted CEOs meeting marked a return to business after the summer, and the “back to school” theme continues this week, with Lord Darzi’s performance review, and NHSE’s winter planning letter both imminent.

But, first, let’s address the health and social care secretary’s appearance at the CEOs meeting.

Attendees told HSJ Mr Streeting was “realistic” about recovering NHS performance, talking a 10-year recovery trajectory, and accepted there would be no significant improvement this winter, as we reported last week.

He talked of a brighter future and there seems a genuine belief among leaders that Mr Streeting wants a constructive relationship with senior NHS managers.

But it’s the tricky position the NHS finds itself in right here and now which is vexing leaders most – and unfortunately there appears to have been little from the new boss on these justifiable worries.

One anonymous comment on our story neatly summed up the mood among other attendees I spoke to.

The commenter said: “I was in the room and to be fair there was more positivity about the future in what was said but we are in a right hole at the moment.

“Also to be fair, to blame the new government when they’ve only had the summer to get going, and they are already halfway through a rapid review by Darzi, after 14 years in opposition, might be interpreted as a bit harsh.”

A “right hole” indeed. The system is already way off course, even against a £2.2bn deficit target, after just five months of 2024-25, and that’s before factoring in any extra activity to deliver on ministers’ “40,000 extra weekly appointments” manifesto pledge.

While the pledge came with some (relatively modest) money attached (c£1.1bn), the cash is yet to manifest into reality, and NHSE has already told government the service will in fact have to “slow down” efforts to cut waiting lists without fresh funding, as we revealed last month.

The Times’ reports this week that ministers are set to approve a £800m raid on capital budgets, following a pattern also familiar from recent years, but this might be needed simply to plug deficit gaps, rather than buying any actual extra care.

Ironically, The Times report also says Lord Darzi of Denham’s “independent review of NHS performance”, due out tomorrow and heavily trailed this weekend, will say that exactly these sorts of capital to revenue transfers are A Bad Idea.

Bearing in mind the NHS Confederation estimates the system needs around £3bn to address an in-year black hole, and a capital raid will also further damage infrastructure investment, this is far from optimal for local leaders.

With NHSE expected to publish the “winter letter” imminently, giving the NHS its annual marching orders for the trickiest months of the year, perhaps we’ll be enlightened soon on how the centre is proposing to balance these tensions.

Thursday, the day Darzi’s performance report will drop, will also see the latest round of monthly performance statistics, further underlining the service’s dire position.

How will ‘40k-a-week’ pledge work?

Another matter system leaders await details on, and none were forthcoming on from Mr Streeting last week, is on the “40k extra appointments-a-week” pledge, which adds up to two million appointments a year.

The pledge was one of few Labour NHS manifesto policies which comes with new money (around £1.1bn), but senior figures are still in the dark about any detail on delivering it.

Those familiar with discussions told Recovery Watch they expected the cash would be distributed by the elective recovery fund mechanism, flowing from NHSE to integrated care boards and then onto trusts.

But before any is even released by the Treasury, trusts will have to burn through the rest of the £3.2bn already in the ERF for 2024-25.

The fact there is already nearly three times’ the amount of ERF funding than there is for this flagship manifesto policy is indicative of the limited scale of the intervention.

The pledge only amounts to an extra 1.3 per cent’s worth of activity, on a baseline of c.160 million appointments (22m inpatient episodes and around 138m outpatients) from June 2023 to July 2024, as the Health Foundation has suggested is a fair benchmark.

Of course, trust leaders remain concerned about how they are going to pay staff to do the work which will be done in extra non-contractual shifts on evenings and weekends.

Health and social care secretary Wes Streeting told HSJ during the election campaign he expects staff to be paid at “time and a half” for the additional shifts, but this is of course less than what consultants can already claim for overtime in many parts of the country.

A tricky year lies ahead and while Mr Streeting’s “blame the Tories” mantra may cut it over winter, NHS leaders already fear it’s them who will likely be in the firing line thereafter.