Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, with reference to NHS Improvement’s publication entitled Quarterly performance of the NHS provider sector: quarter 4 2018-19, for what reasons the underlying deficit of the NHS provider sector has grown to £5.0 billion; and if he will make a statement.

We have seen an improvement in the provider deficit from £991 million in 2017-18 to £827 million.

We recognise that it is important that the provider sector balances and there is still much more to do. The National Health Service has committed to returning the provider sector to balance, as well as all providers, as part of its NHS Long Term Plan, supported by the new cash terms funding commitment of £33.9 billion by 2023-24.

It is misleading to infer the financial health of the provider sector from changes in the reported underlying deficit. The purpose of calculating of an underlying deficit is to use as a baseline for planning purposes for individual trusts. Adjustments made to construct this figure include the removal of funding that is recurrent in the national NHS budget (but not for individual trusts), for example the Provider Sustainability Fund, which grew from £1.8 billion in 2017-18 to £2.45 billion in 2018-19. The growth in the underlying deficit simply reflects a growth in this recurrent income stream.