The financial ‘stretch targets’ issued to acute NHS trusts would reduce their deficit by just 16 per cent, HSJ analysis has found.
- If acute NHS trusts achieved “stretch targets”, forecast deficit would only reduce by 16 per cent
- HSJ analysis shows if submitted revised plans were achieved, there would be an improvement of 5 per cent
- Finance expert says TDA is taking a “pragmatic view” of trusts’ financial situation
The NHS Trust Development Authority has refused to reveal the targets, which were issued to every non-foundation trust in August, however HSJ has obtained the figures from 44 of 55 acute trusts.
- Explore the data
- Emergency savings drive and stretch targets fail to reduce provider deficit
- Trusts continue to forecast £2bn deficit as overspending worsens
All providers were told to implement emergency measures to reduce spending, such as a recruitment freeze for non-clinical roles. Many FTs were also given stretch targets.
The 44 non-FTs that revealed their targets had forecast a combined deficit of £1.07bn at the start of the year, and have been asked to reduce this to a deficit of £896m – an improvement of 16 per cent.
Ten biggest stretch targets for non-FTs
|Trust||Original plan (m)||Revised plan (m)||Stretch target (m)||Extra savings needed (m)|
|Nottingham University Hospitals||-£49.2||-£49.2||-£36.0||£13.2|
|Imperial College Healthcare*||-£18.5||-£7.5||£11.0|
|East Lancashire Hospitals||-£20.6||-£12.1||-£12.1||£8.5|
|Pennine Acute Hospitals||-£25.8||-£19.9||-£18.2||£7.6|
|Hull and East Yorkshire Hospitals||-£21.9||-£18.3||-£15.7||£6.2|
|Leeds Teaching Hospitals||-£40.2||-£40.2||-£34.7||£5.5|
|Lewisham and Greenwich||-£38.0||-£33.5||-£33.5||£4.5|
* Imperial and Plymouth have not finalsed their revised plans
However, at least 12 trusts have not changed their plans, including the largest. Barts Health Trust said it has not submitted a new deficit plan, despite being asked to reduce its £135m shortfall to £115m.
The size of the stretch targets varied between trusts. Imperial College Healthcare Trust was asked to reduce its £18.5m deficit plan by 60 per cent, while Weston Area Health Trust was asked to reduce its £8m deficit plan by 3.7 per cent. The revised plans drawn up some trusts, such as Worcestershire Acute Hospitals, are worse than those originally submitted.
If the revised plans were achieved, there would be an improvement of 5 per cent. Projected across the whole provider sector, this would reduce the overall deficit by just £105m.
It is understood that the Department of Health and NHS England told providers at the start of the financial year that their combined deficit at the end of 2015-16 should be no more than the £822m shortfall reported for 2014-15. However, the size of the stretch targets suggests regulators have given up on this ambition.
Paul Briddock, director of policy for the Healthcare Financial Management Association, said this suggested the TDA was taking a “pragmatic view”.
He added: “The reality is that provider organisations are in extremely challenging financial positions, and the notion that by simply placing pressure on them to stretch their resources, further still will lead to significant contributions towards the overall deficit is not a realistic one.”
A spokeswoman for Barts Health said it was “working hard to minimise the deficit”, but had not submitted a new financial plan.
She added: “We are working with commissioners to ensure that any fines and penalties that would have been levied for breaching waiting times targets are reinvested in full. We are also cutting our spending on expensive agency staff with the aim of filling 95 per cent of posts with permanent staff.”
A spokeswoman for the TDA said: “We are currently focused on supporting our organisations to deliver realistic plans for the rest of this financial year.”
Yesterday, HSJ revealed trusts’ latest financial reports, which refer to performance prior to the impact of the stretch targets, show the acute sector continuing to forecast a deficit in excess of £2bn.
- Acute care
- BARTS HEALTH TRUST
- Department of Health and Social Care (DHSC)
- EAST LANCASHIRE HOSPITALS NHS TRUST
- East Midlands
- HULL AND EAST YORKSHIRE HOSPITALS NHS TRUST
- IMPERIAL COLLEGE HEALTHCARE NHS TRUST
- LEEDS TEACHING HOSPITALS NHS TRUST
- LEWISHAM AND GREENWICH NHS TRUST
- NHS Trust Development Authority
- NOTTINGHAM UNIVERSITY HOSPITALS NHS TRUST
- PENNINE ACUTE HOSPITALS NHS TRUST
- PORTSMOUTH HOSPITALS NHS TRUST
- South Central
- South West
- University Hospitals Plymouth NHS Trust
- WESTON AREA HEALTH NHS TRUST
- Yorkshire and the Humber