Stevens warns trusts must make more savings this year

The NHS England chief executive said annual contracts had been signed in the large majority of areas, in contrast to the position six weeks ago when there were widespread disagreements.

However, he said there were still some trusts which refused to agree the control totals they were offered earlier this year by NHS Improvement, and were forecasting “pretty big” deficits.

He said NHSI chief executive Jim Mackey and his team “will be engaging with individual trust chief execs and chairs over the course of the next fortnight or so [and there] will be some fairly straight conversations about what is needed from individual trusts”.

“The reality is that there may have been a slight misunderstanding that you can just choose your own level of deficit in the system in 2016-17, and that is a major misreading of the tea leaves.”

He refused to say how many trusts were in this position. He said if they did not change, these deficits would mean other trusts having to make even bigger savings, or less being spent on other services.

“For some institutions with large deficits in 2015-16 frankly they are going to need to make more progress in 2016-17, otherwise what they’re implicitly doing is saying, ‘Somebody else’s control total has got to move in the wrong direction in order that we can keep ploughing our own furrow.’”

Mr Stevens added: “The majority of organisations have responded very positively to the approach that’s been taken by NHS Improvement, but there are a small number where they haven’t yet got that message and they mistakenly believe that somehow the NHS can just choose its own spending and what gets left over for everybody else will just be a residual after they set their own plan for the year.”

He praised those who had examined their “cost growth over the last 24-36 months” and were seeking to reverse much of it. Mr Stevens said a large part of the required savings this year could be met by pushing down nursing agency rates and reducing use of agency staff by recruiting permanently.

“Overall in the NHS right now we need to substitute temporary nurses for permanent nurses,” he said. “We need more permanent nurses not fewer.”