"The chancellor's decision is a setback for the health secretary, who had been lobbying behind the scenes in Whitehall for extra money to pay off 18,000 personnel who are losing their jobs. The Treasury has instead allowed the Department of Health and Social Care (DHSC) to overspend its allotted budget by about 1bn this financial year. But this is on the understanding that it will have less money in 2026-27 and no new cash overall. Streeting had spent months trying to persuade the Treasury to grant additional funding to enable the NHS's 42 integrated care boards to start slimming down their role."
"The 1bn is needed to let the boards finally shrink their workforces a process that had been due to finish by the end of December. It also covers payoffs to an unknown number of employees at NHS England, which is being abolished and merged with the DHSC in 2027. The process had ground to a halt amid disagreement over who should foot the bill for the redundancies."
"NHS bosses in England last month told ministers they needed 3bn more this year to cover the cost of redundancies, strikes by resident doctors five days of industrial action start this Friday and rises in drug prices. All three were unforeseen when the NHS's budget for this year was set, they argued. Sources say the Treasury offered to make a deal with the DHSC in which it would provide extra money for redundancies if the department agreed to absorb the cost of higher drug prices. However, no agreement was reached, with the extra costs of medicines likely to prove significant."
The Treasury declined a direct 1bn emergency payment to cover mass redundancies but permitted the Department of Health and Social Care (DHSC) to overspend by about 1bn this financial year on the condition of reduced funding in 2026-27 and no net new cash. The funding dispute stalled cuts to 42 integrated care boards and payoffs for roughly 18,000 personnel, and delayed a programme that had aimed to finish workforce reductions by December. NHS leaders sought an additional 3bn for redundancies, strikes by junior doctors and drug price rises, but talks with the Treasury failed to resolve cost-sharing over medicines.
Read at www.theguardian.com
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