News / Financial position unsustainable, says Charlesworth

She made the claim as the Department of Health published its annual report and accounts, which demonstrated that the Department took a number of measures to mitigate the financial pressures on the NHS in 2014/15.

These included making savings of £662m against central budgets and transferring £640m from savings made in the capital budget to the revenue budget. It also secured £250m from the Treasury. These and other measures ensured the Department of Health group spent within the limits set by Parliament and the Treasury.

‘The NHS is struggling to contain rising costs and balance its books,’ Ms Charlesworth said. ‘The Department of Health’s annual accounts and report confirm that spending pressures in the health service are outpacing funding – business as usual was not affordable in the last financial year and it’s even less affordable this year.’

She pointed out that agency and temporary staff spending had grown by 27% in 2014/15 and NHS providers had an overall underlying deficit of at least £1bn.

‘This was the result of spending pressure growing at a faster rate than their income. This is not sustainable – without rapid improvement and change the NHS will bust its budget.

‘The NHS urgently needs practical support and dedicated resources to make the changes that will unlock the efficiency opportunities that undoubtedly exist across the service.’

The Department’s report confirmed that 131 providers ended the year in deficit and overall NHS providers ended 2014/15 with a net deficit of £842m, which included non-recurrent income support.

NHS trusts reported a net £484m deficit and foundation trusts £358m. Non-recurrent support totalled £353m from the Department and NHS England, meaning the underlying provider deficit was almost £1.2bn.

Meanwhile, NHS England has said £579m of previous years’ surpluses will be drawn down in 2015/16. The figure includes £394m drawn down by clinical commissioning groups, £100m for direct commissioning and £85m for programme and administration budgets. Overall, the commissioning sector is forecasting a headline underspend of £5m.