Rise in ICSs missing financial plans despite NHSE claim more would deliver

A total of 25 integrated care systems – more than half of the 42 – missed their plans in 2023-24, as financial problems became increasingly widespread, according to HSJ analysis.

This was up from 18 the previous year.

Many local leaders criticised the planning process for 2023-24, saying national leaders applied pressure to set plans that were not realistic.

Speaking last summer at the conclusion of that year’s planning round, NHS England’s chief financial officer Julian Kelly was asked by HSJ whether more areas would hit their financial targets.

He said: “My answer to that is yes… I would expect more ICSs, definitely, to meet their plans this year, because we’ve done a lot to work out where it’s going to take a bit of time to recover back to living within what would be the completely fair shares allocation…

“I absolutely expect a lot more ICSs to hit their plans.”

NHSE provided additional funding to systems during the year to mitigate the impact of industrial action.

The missed plans included systems that said they would break even but overspent, such as Greater Manchester, North East London, Derby and Derbyshire, and Nottingham and Nottinghamshire.

Also on the list are areas that ended the year with a larger deficit than initially planned, including Devon; Kent and Medway; and Shropshire, Telford and Wrekin.

At the start of the year, Mr Kelly also said he had “more confidence in the aggregate plan [for 2023-24] we’ve got to than probably even at the start of last year”.

ICSs – which include trusts and integrated care boards – began 2023-24 planning a £650m deficit. A deficit of around £2bn was eventually reported against that plan.

Midway through the year, the Department of Health and Social Care and NHSE were forced to raid central budgets for tech and capital, alongside additional cash injections from the Treasury, to mitigate the costs of industrial action.

Much of this funding was passed on to local ICSs to pay for lost productivity and higher staff costs.

Systems’ financial plans are suggesting the financial deficit will rise further in 2024-25, and NHSE is pushing many areas to set more ambitious plans.

An NHSE spokeswoman said: “As we’ve made clear throughout the year, ICSs have faced increased pressure as a result of the much higher levels of inflation, and the impact of unprecedented industrial action.”

HSJ collected initial plans and then compared these to the year-end outturn position. The figures in the table, which are taken from board papers, exclude the impact of the one-off cash support provided to deficit ICSs in February, as this is still treated as a deficit by NHSE and is repayable in future years. The final figures may therefore differ slightly from those reported by local ICSs. Figures are subject to audit. Figures corrected for North East and North Cumbria to show a £35m deficit.