A Lowdown snapshot survey of the board papers and plans of London’s ICBs reveals the depth of financial pressures and some of the impact upon services

North Central London ICB (NCL) has published May Board papers, which nonetheless go back to a Month 9 Financial Report, with grim news that the system as a whole was £53.6m in deficit, £32m adverse to plan – all of this down to providers.  There was no mystery as to why:

“The primary causes remain consistent, including system expenditure on agency staff being higher than plan and target, [inadequate] delivery of planned efficiency savings, persistent excess inflationary challenges over and above those that the system was allowed to plan for …” (p14)

There is clear evidence here of denial and delay in reporting the bad news to minimise the consequences:

“Although the system forecast position will remain as break-even at Month 10, there will be movement among providers’ positions as part of this. Providers whose positions move adverse to plan will trigger the NHSE Forecast Outturn protocol but as the overall system is still forecasting break-even, the consequences of this will be limited.” (p14)

Somehow despite the scale of the deficits, and the red-rated risk to long term financial stability, the ICB reports “It is likely that NCL will be able to deliver a breakeven financial position for the 2022/23 financial year. It is though crucial to note that this is underpinned by a significant level of non-recurrent benefit which will not be available in 2023/24 and that continued improvement to the underlying position of the system as whole is required.” (p95)

The reality is even more alarming:

“Planning processes are underway and the plan, submitted at the end of March 2023, is likely to show a System-wide deficit of approximately £120 million. The main pressures arising are from excess inflation on utilities and other CPI-driven contracts, as well as from the elective recovery scheme for 2023/24, which requires NCL to deliver a stretched target in excess of almost all other ICBs but for the same share of money as other ICBs.” (p95)

Indeed the whole ICB financial plan going forward is based on “an assumption on 5% efficiency savings on non-pay expenditure,” for which no evidence is produced to suggest it is achievable, especially since “There is a significant gap between the revenue that NCL receives to fund elective activity and the level of activity taking place.” (p15)

Despite the underlying deficit, NCL, under the red rated risk of “Failure to Deliver 2023/24 Statutory and Other Financial Requirements set by NHS England,” notes:

“The 2023/24 ICB draft financial plan is reporting a break-even position for the ICB. … To achieve a balanced position the 2023/24 plan assumes c£40m of efficiencies and non-recurrent actions will be achieved. In addition, there is an estimated c£60m of risk which, if it emerges, is assumed will be fully mitigated in year.” (p97)

The assumptions are far-reaching, and include:

“Requirement to identify non-recurrent funding as the ICBs recurrent cost base is higher than expected allocations – £10.8m

  • Full achievement of the ICBs efficiency targets – £30.5m
  • Assumption that the ICB can mitigate identified risks not included in the financial plan – £67.9m.” (p82)

The ICB’s chief executive warned the March meeting: “there may come a time when the ICB has to acknowledge that as a result of the operational pressures confronting it, certain targets are unattainable for the time being.” (p20)

The ICB’s Board Assurance Framework, assessing risks, also includes the chilling warning that gaps in the recruitment process of Continuing Health Care could 

“impact on the ICB’s ability to fully deliver against the NHS Long Term Plan priority of improving services for people with a learning disability and autistic people by ensuring that they have annual health checks and reduce their reliance on inpatient care.” (p89)

The risk is that vulnerable patients may be left with no care at all: “Should there be a gap in resources, the delays in assessments/reviews may lead to significant concerns around patient care, given that the care is insufficient/nonexistent.” 

Recruitment appears to be a major weakness across the ICB:

“Across permanent and fixed term contracted staff, the turnover rate in NCL is 19.3% – over 8,000 people leave our workforce every year and this is now increasing following a reduction over the past two years. The age band with the second highest turnover rate is under 35s, which poses a significant threat to our future workforce sustainability.

“… NCL’s GP nursing rates remain one of the worst in the country (13 per 100,000 compared to a national average of 27 per 100,000.) …. Our Mental Health workforce is heavily reliant on temporary staffing, with 49% of the growth in the workforce over the last three years having been bank & agency rather than substantive , and the proportion of total staff who are bank/agency has increased from 12% to 15%.

“… If trends continue, our workforce gap could increase by 17,061 over the next five years.” (p42)


North East London ICB (NEL) revealed in its January Board that it had given up on balancing the books and “agreed a revised deficit plan of approximately £35m which is recognised by NHS England.”

It will surprise some other ICB finance directors that fessing up to a deficit they can’t hide has even secured a cash handout from NHS England: 

“Committing to an agreed revised plan means we will receive a small additional allocation and we also qualify for some additional capital monies for the next financial year.” (p17) In fact the extra money adds up to £10.5m, “resulting in a final year-end deficit of £24.5m.” (p264)

The ICB is continuing to spell out the problem, noting (p53):

“We currently have a blend of health and care provision for our population that is unaffordable, with a significant underlying deficit across health and care providers (in excess of £100m going into 23/24). If we simply do more of the same as our population grows our financial position will worsen further and we will not be able to invest in the prevention we need to support sustainability of our system.”

NEL contains some of the most deprived areas in the country, and has a growing population:

“Without changes to care models we expect that over the next 5 years this translates to: A&E activity increasing by 12% (costing an extra £16m); inpatient activity increasing by 16% (costing an extra £131m); outpatient activity increasing by 15% (costing an extra £43m); and imaging activity increasing by 17% (predicted extra cost currently unavailable).” (p231)

The ICB notes “underlying deficits across the system and particularly within Barts Health and Barking Havering and Redbridge University Trust that we need to recognise and eliminate as a system … ” (p234)

NEL also suffers from a huge agency bill for filling vacancies, almost double the scale of spending in the rest of London:

“we know there are opportunities for reducing unnecessary costs, such as agency spend – in NEL agency spend is 7% of total spend vs 4% median for London ICSs.” (p57)

And unlike Patricia Hewitt’s report, NEL is up front in criticising inadequate, unequal and often unfair allocations from central government to the public health grant, which “significantly impacts on our ability to invest upstream in preventative services.” (p57)

Allocations range from £114 per person in City and Hackney to £43 per person in Redbridge. The variation is at odds with the government’s intended formula (which is based on standardised mortality rates for people under 75). Barking and Dagenham has the highest rate of any borough in London, yet receives only £71 per person. Havering has the same rate as Tower Hamlets yet Havering receives £45 per person, whereas Tower Hamlets receives £104 per person. More evidence of the hollowness of “levelling up”.

NEL seems to be the only ICB flagging up a problem in relation to primary care, warning:

“Practices across NEL may be unable to deliver online consultation access to patients in 2023/24 if the expected national online consultation license funding is not made available. …

“Programme may not be sustainable due to lack of funding after 2023/24.” (p131).


North West London ICB (NWL) April Board papers claim that “Subject to the audit review NWL ICS has delivered all the financial targets,” but warns that “The improvement from last month’s £26m deficit position is all due to non recurrent initiatives that were forecast in the previous months.” (p105)

Indeed there is a problem going forward: “A break even plan for 23/24 has been agreed for the system with efficiency target at £220m. Work has started to identify 23/24 efficiency schemes however there remains a material unidentified efficiency gap that will need to be closed.”

The “efficiency gap” is so wide because the NWL system is struggling to clear a massive £348m underlying deficit in just three years, reducing it to £176m in 2023/24. 

This is easier said than done: “To achieve the overall financial balance, the system is required to make an overall productivity and efficiency target of 4.6% (£220m)” – well above the levels achieved elsewhere in the NHS.

It’s not clear if this is possible, since “The system flagged a further £136m of risk relating to inflationary pressures, of which only £75m is mitigated.” (p115)

The ICB states that sufficient potential savings “have been identified” in Continuing Health Care, Primary Care Prescribing, Estates, Primary Care and Mental Health Non NHS Contracts, and says “Plans are in development to identify the shortfall in the savings currently evident in the Non NHS Acute and Community Contract Programme areas.” (p131)

Meanwhile the ICB is facing considerable problems, with significant activity increases, particularly in some of the “non-NHS acute contracts” in 22/23. It is seeking to cut spending totalling £13.4 million from “non NHS budget areas” – acute services, mental health, community health and continuing care – although no details are given of the non-NHS providers.

One way of reining in these increasing bills is for the NHS to increase its own capacity and NW London seems set to join South Yorkshire and Bassetlaw ICB in setting up an NHS Elective Orthopaedic Centre, following the highly successful example of the South West London Orthopaedic Centre established almost 20 years ago. The NWL EOC is aimed at reducing costs of routine orthopaedic surgery by 13% (£4m per year) and keeping NHS funds within the NHS (pages 53-54).


South East London ICB  (SEL) notes in its April Board papers the progressive reduction in its deficit from £60m in Month 9 (p11)  top £53.9m in month 10 (p69) and £45.4m in Month 11 (p72). The system was continuing to forecast a breakeven position for year end, “with the release of non-recurrent funding across ICB partners year to date and at year end to support the position.”

“The position includes the delivery of £201m savings in year, representing a combination of recurrent and non-recurrent savings, with non-recurrent savings also representing a carry forward pressures into 2023/24.”

This is indicated by the projected gap in funding for 2023/24:

“a forecast gap to break even for the end of 2023/24 of just under £100m. Further work is underway to improve upon this position with a specific focus on the acute hospital sector where the gap to break even resides.” (p115-6)

One key area for savings is reducing the dependence of mental health service on out of area placements, many of them to private sector facilities. (p118)

However the defiance of the law of gravity appears to be reaching its limits in 2023/24, as the Operational Plan admits, and NHS England appears to have rejected the most recent financial plan:

“Our biggest area of challenge relates to our financial position and our end March 2023 plan does not reflect a position that meets the national expectation of breakeven ICB financial plans for 2023/24. Our planning process has focussed on the application of agreed financial planning assumptions related to inflation and efficiency, put against expected income and expenditure for the year. After applying ambitious and consistent productivity and efficiency improvement assumptions of 4.5% we still have a material gap to a break even position of just under £100m at this stage, with financial pressures felt particularly in our acute hospital trusts.” (p120)

A look at the biggest acute providers’ Board papers also reveals the scale of the problem: Guy’s & St ThomasApril Board papers note a month 9 (December) deficit of £24.6m:

“An overview was presented about how the Trust could bridge the gap between its current position and a break-even yearend position. This would require significant non-recurrent mitigations which would not improve the Trust’s underlying financial position and so not alleviate the financial pressure on the Trust that was anticipated in 2023/24.”

Indeed no less than 68% of the trust’s identified cost cutting schemes are “non-recurrent” (p45). Another stubborn problem is spending on agency staff – 17% above the NHS England cap.

Kings College Healthcare is in an even worse position, £38.4m in deficit at Month 10, with Covid a major factor: 

“The King’s plan, in line with national assumptions for minimal COVID, assumed for 50 COVID beds and normalised sickness. Throughout the year, King’s has had on average 150+ COVID patients, 30 additional beds out of action due to the IPC requirements relating to these patients and sickness absence which is 3% above anticipated levels. This has led to incremental costs but also hampered the Trust’s ability to over perform on the Elective Recovery Fund.” (p19)

King’s is another Trust that has tried to recruit its way out of heavy agency bills, increasing the headcount by 650 in the year to January 2023 and continuing efforts to convert bank and agency staff onto Trust contracts. (p55)

South West London ICB (SWL) is another one that has given up the battle to deliver a break-even for 2022/23, and its March Board papers report its agreement with NHS England to move to a forecast deficit of £57.5m. It is another example of an ICS running in balance or a small surplus while all of the financial pressures are faced by the providers. (p115)

The forecast deficits are in two of the larger acute providers Epsom & St Helier trust (£35m) and St George’s (£30m), while the Royal Marsden Hospital, with its extensive income from private patients and specialised caseload delivers a surplus of £7m. Significant reasons for the deficits are excessive spending on agency staff and a 24% (£66m) shortfall in the £280m plan for “efficiency savings”. (p125). 

Only 44% of the savings achieved are recurrent, with over £90m down to one-off non recurrent measures, implying a substantial underlying deficit going in to 2023/24. (p126)

However the ICB is vague in the extreme on its position for the new financial year, admitting only (p133):

“The operational guidance requires systems to breakeven in 2023/24 which will be challenging, given our current financial environment. Our system will need to focus on achieving productivity improvements to ensure that we make further progress in delivering against the national priorities, in particular continued recovery for elective and cancer care. We will ensure that the final plan reflects our system’s ambitions whilst remaining realistic and deliverable.”


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