Auditors find NHS financial performance good overall

BMJ 2009; 339 doi: (Published 01 October 2009) Cite this as: BMJ 2009;339:b4029
  1. Jacqui Wise
  1. 1London

    The overall financial performance of NHS trusts and primary care trusts (PCTs) in England is good and improving, the Audit Commission has concluded.

    But the independent watchdog says that there is still room for improvement, with nine NHS trusts failing to meet minimum standards this year and with relatively few assessed as performing strongly. The overall financial performance of PCTs was good, but no PCT received an excellent rating this year.

    The commission has published its annual financial performance tables that assess how NHS trusts and PCTs manage their resources and whether they deliver value for money. It found that 93% of NHS trusts (116 trusts) met or exceeded minimum standards, compared with 91% in 2007-8. Nine per cent of NHS trusts (11 trusts) were assessed as performing strongly, compared with 4% last year.

    Andy McKeon, managing director for health at the Audit Commission, told the BMJ, “NHS trusts have made steady progress over the last four years, with most performing well or strongly. We also need to take into account the fact that the best performing trusts have been creamed off to become foundation trusts.” Foundation trusts are assessed separately by Monitor, with the results published as part of an annual audit in October.

    Nine NHS trusts failed to meet the minimum standards in 2008-9, compared with 14 in 2007-8. These trusts are Barking, Havering, and Redbridge Hospitals NHS Trust; Bromley Hospitals NHS Trust; Buckinghamshire Hospitals NHS Trust; North West London Hospitals NHS Trust; Queen Elizabeth Hospital NHS Trust; Queen Mary’s Sidcup NHS Trust; Trafford Healthcare NHS Trust; West Middlesex University Hospital NHS Trust; and Whipps Cross University Hospital NHS Trust.

    Mr McKeon said that these trusts have long standing financial problems, “but in most cases they are showing signs of improvement, and three of them have now merged into the new South East London Trust, and we would expect to see further progress next year.”

    For the first time PCTs had a more demanding assessment, which was more focused on outcomes. This assessment considers how England’s 152 PCTs manage their finances, workforce, and assets to deliver value for money and how they govern themselves. Only eight PCTs failed to meet minimum standards in one or more themes, but no PCT was found to perform excellently in any of the areas assessed.

    The Audit Commission says that the NHS is showing continuing improvement in financial stability. The NHS, excluding foundation trusts, recorded a total surplus of £1.74bn (€1.9bn; $2.8bn) last year, about 2% of total NHS resources. Only six NHS trusts and one PCT failed to achieve financial balance in the past year, compared with 11 in 2007-8.

    But the commission warned that in the next few years all NHS organisations will be under further pressure to deliver high quality services without the level of funding growth experienced in the past.

    Mr McKeon said, “Trusts and PCTs are much better at managing their budget than they are at medium and long term planning and at managing their assets. This is going to be increasingly important in the future as expenditure tightens. The main weakness for PCTs is in the way they manage their workforce in order to get the best productivity.”

    Nigel Edwards, director of policy at the NHS Confederation, said, “That the majority of trusts have been successful in balancing their budgets while also working to meet required targets on patient care and coping with tougher regulatory requirements is a testament to the hard work being done across the NHS.

    “For those trusts where there are still problems there is no complacency: efforts are being made to ensure all aspects of performance continue to improve.”


    Cite this as: BMJ 2009;339:b4029


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