Increase NHS funding or face £30 billion shortfall, politicians warned

The health service in England will not be able to cope without billions in extra funding over the next five years, politicians have been warned.

The stark warning comes from an alliance of health service leaders in England, who say the without extra funding and new service reforms, the NHS faces an annual £30bn shortfall by 2020.

The Five Year Forward View report says that there the NHS can and must generate cost savings by changing services – such as moving some hospital services to primary care – but states that this will still not plug the gap.

The health chiefs say the NHS would still need above inflation rises of 1.5% over the coming years, or an extra £8bn a year above inflation by 2020.

The message has been delivered by six national bodies, led by NHS England and its chief executive Simon Stephens, and is timed to pre-empt political message in the run up to next May's UK general election.

The current NHS budget stands at £100bn a year, but has only kept track with inflation over the last five years, while the increase in user demand has risen far faster – and is predicted to maintain a high rate.

Simon Stevens will tell an audience of key stakeholders today: "Healthcare in this country has improved dramatically over recent years and has weathered recent financial storms with remarkable resilience, thanks to protected funding and the commitment and dedication of NHS staff.

"But the NHS is now at a crossroads – as a country we need to decide which way to go. The Forward View represents the shared view of the national leadership of the NHS, setting out the choices – and consequences – that we will face over the next five years.

"It is perfectly possible to improve and sustain the NHS over the next five years in a way that the public and patients want. But to secure the future that we know is possible, the NHS needs to change substantially, and we need the support of future governments and other partners to do so."

Stephens warned that if funding and service change issues were not addressed, the "consequences for patients will be severe" in areas such as cancer and heart disease.

The NHS and politics

The future of the NHS is shaping up to the be one of the key issues of the general election, with most polls showing the health service ranks in the top 3-4 issues for voters.

The timing of the report is clearly no accident, and should help the NHS leaders set out their message clearly, before the political parties launch their manifestos. The NHS leaders will be wary that election battles between the Conservatives, Labour and other parties will potentially obscure some of the fundamental pressures and choices that they are saying must be urgently faced.

The report is also remarkable in that it is co-authored by six organisations: NHS England, Public Health England, the regulator Monitor, the NHS Trust Development Authority, Care Quality Commission and Health Education England. This alliance carries particular weight because Monitor is the NHS financial regulator, independent of NHS England, which runs the health service in England, and also independent of the government's Department of Health.

All the leading political parties have welcomed the report, including the health minister Jeremy Hunt – but none have come close to promising the extra £8 billion that the NHS leaders say they need.

In tandem with calling for increased funding, the Five Year Forward View report also sets out some far-reaching proposals for how the service can adapt to meet the health challenges. These include creating more primary care GP super practices, and giving local councils powers to encourage healthy living by limiting junk food outlets and the sale of cheap, high strength alcohol.

The report makes no new recommendations relating to the use of medicines, but does reiterate existing plans to rein in costs associated with the Cancer Drugs Fund, which it says will 'converge' with NICE in how its assesses and priorities drugs for appraisal.

Responding to the report, Chris Ham, chief executive of the health think tank The King's Fund said:

'With the national leaders of the NHS speaking with one voice on this issue, politicians now need to explain whether and how they will find this money. With deficit reduction still a high priority, this will not be easy, but today's report is a reminder of how important it is to ensure the NHS is adequately funded in the next parliament.'