NHS faces 'unprecedented financial challenge'

The NHS is facing an "unprecedented financial challenge" that may force cuts to services and numbers of hospital beds, the head of an organisation representing health service organisations said today.

Mike Farrar, the chief executive of the NHS Confederation said that the need to make £20 billion of financial savings by 2015 "means our finances are under more strain than ever".

And he warned that few users of the NHS were prepared for the scale of the changes likely to be forced upon the service by financial pressures.

Mr Farrar told The Guardian: "I am deeply concerned that the gravity of this problem for the NHS is not widely understood by patients and the public.

"There is a real risk we will sleepwalk into a financial crisis that patients will feel the full force of.

"This could see the NHS forced to salami-slice its way out of financial trouble, cutting services and use of less effective treatments."

Mr Farrar, whose organisation represents most NHS hospitals, primary care trusts, ambulance services and mental health trusts in England, said the health service faced an uncertain future.

"There are three scenarios," he said. "The NHS maintains service standards but goes bust while doing so; it sees standards slip but maintains financial balance; or it keeps improving and stays in the black. Clearly, we all want the third option."

A Department of Health spokesman said: "The £20bn of efficiency savings target was set in May 2009.

"We are confident that the local NHS knows it needs to improve productivity and is developing and implementing robust plans to cut waste and deliver the efficiency savings by 2014/15 while maintaining or improving quality.

"For this to happen, the NHS must be modernised quickly through more clinical leadership, redesigning care pathways, cutting administration costs and getting better value for money."

PA