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Editorial Thursday 17 December 2015: The FYFV funding pantomime and the new Amy Winehouse Fund

The NHS Commissioning Board met today, and unanimously passed its latest tranche of documents. (That's passed as in agreed, obvs.)

The Government's Mandate to the NHS was also published.

Various things in these are noteworthy.

'We've funded the Five-Year Forward View in full.' 'Oh no you haven't!'
The Mandate states that "The NHS will receive £10 billion more per year in real terms by 2020-2021 than in 2014. This investment backs in full the Five-Year Forward View, and will mean patients receive a truly seven-day health service, with the services people need being offered in hospitals at the weekend and people able to access a GP at evenings and weekends".

The chief executive's report from Sun King Simon Stevens, contrastingly, says clearly that only 60% of his five tests for the Comprehensive Spending Review have been met.

The funding is frontloaded (this was inevitable, because the provider sector is insolvent); the new demands are in line with the funding profile; and the tariff efficiency asks are realistic (as opposed to the hog-whimperingly stupid ones of past years).

So far, so Versailles.

However, Simon Stevens points out in unambiguous terms that "given the funding pressures in the local authority-financed public health services and the need for wider government action on obesity and related challenges, we cannot yet conclude that this test has been met. Much hinges on whether the Government’s proposed childhood obesity strategy comprises an effective package of credible actions when it is published in the New Year. Absent this, and other linked action, the NHS will be exposed to patient demand and  consequent funding pressures over and above that modeled in the Five-Year Forward View assumptions.

"Fifth, the Forward View made the obvious point that the level of patient demand on the NHS is partly a function of the availability of social care, particularly for frail older people. The SR makes some welcome moves to hypothecate new funding streams for social care, but the overall funding quantum nationally and the distributional effects across England still imply a widening gap between growing need and available services. If unaddressed this would result in extra demand on GPs, community health services and hospitals over and above the FYFV NHS cost estimates. Our ‘fifth test’ should therefore be regarded as ‘unfinished business’." (My underlinings, for emphasis.)

Well, it's the pantomime season, isn't it?

'We've paved your streets with gold!' 'Oh no you didn't!'

Etcetera. This one could run and run.

The Amy Winehouse Fund
There was some interesting stuff in Simon's paper on allocations.

This is significant:

"Establishing a Sustainability and Transformation Fund of £2.14bn for 2016/17. Of this, £1.8bn will be deployed on 'Sustainability' to stabilise NHS operational performance, and £340m for 'Transformation' to continue the Vanguard programme and invest in other key FYFV areas). The Sustainability and Transformation Fund will grow from £2.1bn in 2016/17 to £2.9bn in 2017/18, rising to £3.4bn in 2020/21, with an increasing share of the growing fund being deployed on transformation including the FYFV's New Care Models, and mental health parity of esteem. The NHS England Board will make decisions on allocating the STF for 2017/18 and beyond in the light of place-based Sustainability and Transformation Plans to be developed by July 2016 across the NHS".

For 2016-17, it would be much more candid to call the 'sustainability' bit the 'Amy Winehouse Fund'. It's all about getting the provider sector Back To Black.

(As I put it yesterday, it's a farewell to robbing Peter to pay Paul, and a laurel and hearty handshake to robbing Samantha to pay Jim.)

In the excellent (and anhydrously dry-witted) chief finance officer Paul Baumann's resource allocation paper, there is much smart stuff.

There will be three-year allocations, followed with indicative budgets for 2019-20 and 2020-21 to enable planning.

Devo-Manc get £450 million direct allocation as their "fair share of available transformation budgets over the five-year period". It is not clear whether this will be front-loaded.

Elsewhere, Baumann backs Simon's reservations about the fullness of funding: "We have also included within our modelling the projected contribution of each commissioning stream towards the activity-related savings that we have identified for the commissioning sector as its contribution to the overall efficiency challenge to 2020/21. Moderating demand growth in this way is, however, partly dependent on effective government action on prevention and sustained availability of social care relative to rising need. If either of these preconditions to fulfilling the Forward View is not met, it will place additional unfunded pressures on the NHS over the period to 2020/2". (Again, my underlining.)

Where things get crunchy is on the conditionality for the Amy Winehouse Fund: "£1.8bn of funding will be allocated at the beginning of 2016/17 to the Sustainability element of the Fund. Funding will be released on a quarterly basis subject to agreement by NHS Improvement and NHS England based on
individual providers’ performance against financial, access and transformation eligibility criteria".

That feels as if Simon Stevens and Jim Mackey just got a fast-track to stick poor planners into the success regime.

Do not pass Go. Do not collect £2.8 billion
How much of the new money is spoken for? Baumann told the Board that the NHS remains on course for a £1.8 billion deficit in 2015-16 "and some people think it may be higher" Hello, Paul!

There is also, as I mentioned yesterday, £1 billion new pensions liabilities.

So at least £2.8 billion is spoken for already, via the Amy Winehouse Fund and pension changes.