Mackey admits trust deficit cannot be cleared in 2017-18

The chief executive of NHS Improvement has admitted that a key financial target that was seen as “critical” to the progress of the Five Year Forward View will not be met.

In an interview with HSJ, Jim Mackey said the NHS provider sector will not break even again in 2017-18, and reaching financial balance in 2018-19 will depend on factors outside trusts’ control.

Jim Mackey said the NHS needs to ‘corral the risk’ it faces financially

Mr Mackey said suggestions that the trust deficit would be between £500m and £600m in 2017-18 were “not miles out”, though efforts are being made to reduce this.

Last year, NHS England said it was “critical” for the sector to move out of deficit in 2017-18 to “remain on track to close the [£30bn] funding gap” described in the forward view.

Asked about the lack of detailed financial information in last week’s Next Steps on the Five Year Forward View, Mr Mackey said: “I think that’s been a legitimate criticism. Ideally I’m a manager so I would have liked to have seen some of that detail completely signed off by our board, signed off by NHS England’s board, and the Treasury and Department of Health comfortable with it…

“But we’re just not at that point because we’re still in the muck and bullets of it all.”

Mr Mackey pointed to the “many moving parts” that make the financial recovery uncertain, such as the level of benefit that trusts will experience through the uplift in social care funding, and said many people in the system will feel breaking even in 2018-19 is not possible either.

He added: “The provider sector won’t be in balance in 2017-18. It’s possible to get there in 2018-19, ceteris paribus and all that. But we’re not in control of all those other things.” He said even the timetable to achieve overall balance in 2018-19 was ”very, very risky”.

However he said: “[But] the deficit has dropped quite a lot in aggregate and quite a lot in the number of institutions, so the next bit is about how we corral the risk in the group as a whole and make sure we don’t do a bit over here that causes damage over there… Part of that means there’s going to have to be some really hard decisions.”

NHS trusts are forecast to end 2016-17 with a deficit of £873m, against the planned £580m deficit and “stretch target” of £250m.

Full story in The HSJ, 5 April 2017