NHS Confederation responds to NHS England's letter to local NHS leaders on their financial plans for 2025/26

Commenting in response to today’s letter from NHS England to local NHS leaders on their financial plans for 2025/26, NHS Confederation chief executive Matthew Taylor, said: 

“Local NHS leaders will not be surprised by NHS England’s letter – we are facing an unprecedented financial challenge this year. Our members are having to deliver very high levels of non-recurrent savings that risks carrying over more financial risk into next year. They are gearing up to make extremely difficult decisions about which services to cut to balance their books.  

“They know the role they have to play in this turbulent financial position, but what the government cannot do is to push the risk inherent in this situation onto local NHS leaders and expect them to manage the fallout. That requires the government and NHS England to do all they can to reduce the risks, which includes moving as much earmarked central funding to local systems and trusts as soon as they can to help plug the gap.   

“Local NHS leaders know that their financial plans need to be stretching but also credible and achievable. The danger, if we are not careful, is that our members will face a scenario where they are operating at the outer limits of what is achievable.  

“To avoid this, the government and NHS England will need to take actions that help make this extremely difficult situation more manageable and that avoid local NHS organisations having to make cuts that contradict the government’s three shifts. The short-term financial imperative cannot derail the long-term transformation that is needed to place the NHS on a sustainable footing. The extra £22 billion announced in the October 2024 Budget will help to stabilise the system, but the reality is that over half of that is going on new pay awards for staff, higher pension contributions and other cost pressures. We need to be realistic about what it can provide. 

“Ahead of the Spending Review, the government therefore needs to consider a number of options ranging from raising more private capital investment in the NHS, protecting investment in proven preventative actions which are known to generate savings for the NHS and wider public services and supporting local NHS leaders when they need to make difficult decisions about which services to cut.”