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NHS used £1.8bn fund ‘to firefight’ instead of reforming services, finds auditors

Funding that was intended to overhaul health and social care regionally has instead been spent on coping with existing NHS pressures, according to the National Audit Office.

In a new report, the NAO said that the £1.8bn ‘Sustainability and Transformation Fund’ has been used to balance its books, leaving little left for longer-term service transformation.

The fund was originally given to NHS England in 2016/17 to help 44 regions reform healthcare services locally.

The report said NHS Improvement hoped that the fund ‘would replace the need for most direct departmental cash funding for trusts’.

However, £1bn of the £1.8bn fund ‘was given as cash within the year’ and cash support on top of this increased from £2.4bn in 2015/16 to £3.1bn in 2016/17. 

The report adds that £2.7bn of this ‘was revenue support to allow trusts to maintain services’. 

The fund has helped NHS trusts improve their financial position from a £2.4bn deficit in 2015/16 to £791m deficit in 2016/17.

However, the NAO said that ‘by planning a series of measures to rebalance its finances’, the money available for longer‑term transformation has been ‘restricted’.

Amyas Morse, head of the NAO, said: ‘The NHS has received extra funding, but this has mostly been used to cope with current pressures and has not provided the stable platform intended from which to transform services.’

He added that short-term funding injections ‘could turn into the new normal, when the public purse may be better served by a long-term funding settlement’.

BMA council chair Dr Chaand Nagpaul said: ‘This report provides clear evidence that investment designed to help the NHS transform and improve patient services is instead being used to firefight and meet existing pressures and deficits.’

Meg Hillier MP, chair of the Public Accounts Committee, added that the reports findings are ‘no surprise’ as recent cash boosts ‘have been spent on patching up the problems, not preparing it for the future’.