The road to recovery - delivering financial sustainability in the NHS
11 October 2017
The NHS provides us all with a great deal of pride and is a globally recognised and respected institution. Significant challenges remain however, not least the need to continue to provide quality healthcare whilst delivering significant transformation in a period of constrained resource.
There is no doubt that a large number of NHS institutions are under severe financial pressure in the current climate. According to the King’s Fund in their latest Quarterly Report (June 2017) 36% of all providers ended FY17 in deficit, with 82% of trust finance directors reporting that their FY17 year-end position depended on significant financial support. More than half (52%) of all CCGs have delayed or cancelled spending plans.
Achieving change is undoubtedly challenging but it is also highly attainable. With the right approach change can also be sustainable. Investing in the right people is key - the best organisations benefit from having high quality and stable leadership teams. They have a clear plan for both the long term change they are trying to build and to respond to immediate pressures.
These plans need to be based on key stakeholders fully understanding the way an organisation does, and doesn’t, function well financially which, in turn, requires full transparency of the true financial position. Real benefit can start once there is confidence in the financial baseline, a shared understanding of the deficit and clarity on how everyone can contribute to resolving the issues. Ensuring everyone clearly understands the need for financial improvement, and lining up the operational focus behind it, can really drive successful and long lasting transformation in any NHS organisation.
Last year we published The Road to recovery- our analysis of what organisations need to do to get themselves back on track. Delving deeper into clients' issues, and based on our discussions with them, we’ve updated the report and added some new key thinking. Specifically we focus on cash and working capital; we reflect on financial improvement programmes and we give some stakeholder management tips. We have summarised our approach as six foundations for successful recovery:
- financial challenge and causes
- clarity of purpose
- effective and cohesive leadership
- clear plan of action for turnaround
- clear communication
- effective governance
We hope this report helps identify useful themes that can help all those in the NHS regardless of whether it is for institutions looking to successfully journey through financial turnaround or those seeking to ensure they are ahead of the game and stay there. There are plenty of case studies covering many of the issues organisations are facing.
We’d be delighted to hear from you so please let us know what you think including your own personal lessons and learnings from dealing with financial recovery in the NHS.