NHS Wales risks £700m black hole, think tank warns

A report by the Health Foundation has cautioned that the NHS in Wales council face having a £700 million black hole in its finances by 2020, if it is unable to make savings.

The think tank’s analysis suggested that NHS Wales could end up spending more than it receives due to the pressures of a growing and ageing population, which increases the number of patients living with long-term serious health conditions.

The analysis projects that spending on the NHS in Wales will increase by an annual rise of 0.7 per cent over the next four years in line with forecasted health spending in England.

The report also cites data which shows health spending in the country rose by an average of just 0.1 per cent per year between 2011-12 and 2015-16.

Nonetheless, the research suggests the financial gap could be closed if pay rises among NHS Wales staff continue to be limited to just one per cent a year - and if the service could also deliver annual efficiency savings of 1.5 per cent.

The report advises that NHS leaders must take sustained action to secure the long-term future of the service. This requires: increasing funding by at least 2.2 per cent each year from 2019/20 until 2030/31; developing a strong workforce policy that ensures adequate numbers of high quality and motivated staff are retained and recruited, despite continued pay restraint; investing adequately in a range of public services, particularly social care; and continuing to make efficiencies and reform health care to meet the population’s changing and growing needs.

Anita Charlesworth, director of Research and Economics at the Health Foundation, said: “The next few years will be tough for the NHS in Wales. Immediate and sustained action is needed to protect patient care, but long-term sustainability is possible.

“Tackling the urgent funding pressures facing the Welsh NHS requires an unrelenting focus on improving efficiency. Securing its long-term future also requires increased investment and continued reform so the service meets the changing needs of an ageing population.

“But the health service is not an island – ensuring people can access high quality social care will also be vital to the future of the NHS in Wales.”