News / Monitor: savings target is 'a big ask'

All NHS providers will have to make real-terms savings of at least 2% every year, according to an estimate in Monitor’s five-year planning guidance. This compared with an estimated saving of 1.5% or less in recent years, the regulator said.

Trusts – the guidance applies to foundation and non-foundation trusts – will have to work closely with commissioners to radically transform how they operate over the next five years, it said.

Real-terms efficiencies of around 2% a year were needed to allow providers to ‘catch up’ with best practice and develop new and better patient care, Monitor said.

‘This is significantly more than the 0.4% to 1.4% underlying productivity improvement that external research suggests that the NHS has traditionally delivered,’ the regulator continued. ‘This is a big ask, so Monitor, the NHS Trust Development Authority and NHS England will provide all the support we can to help providers and commissioners in the forthcoming planning round.’

Under the new strategic planning regime, providers must adopt five-year (rather than the present three-year) plans from 2014. These should include a detailed plan for the first two years and a further three-year plan outlining transformational changes.

The annual planning review financial template for 2014/15 will follow this structure. The first two years’ financial plans should be completed on ‘a broadly quarterly basis’, the remaining three years annually.

NHS England planning guidance confirmed that clinical commissioning group five-year plans must detail how they will deal with the financial gap and include appropriate risk and mitigation strategies.