by Steve Sweeney

THE “unsustainable” financial position of the NHS is affecting the services and care it provides, a National Audit Office (NAO) report acknowledged yesterday.

The report reveals that two-thirds of NHS trusts are in deficit and an increasing number of clinical commissioning groups are failing to remain within their budgets.

NHS trusts have received £1.8 billion in emergency funding this year, meaning that the real financial shortfall could be a record £2.65bn.

NAO head Amyas Morse said the financial problems were “endemic” and “not sustainable,” blaming “aggressive efficiency targets” for the increasing number of NHS trusts falling into deficit.

Almost £1bn has been transferred from the budget for building work and IT to help with the day-to-day running of the NHS, including payment of staff wages, the report found.

The NAO warned that this “risk trusts’ ability to achieve sustainable service provision.”

The health service’s agency staffing bill hit £3.7bn in the last financial year, up from £3.4bn in 2014-15, and the NAO warned that it may take years to resolve this problem.

The report highlights that Care Quality Commission ratings for NHS trusts are linked to poor finances, with the 14 trusts whose work was rated “inadequate” also in serious financial difficulty.

It mentions an estimate by the Department of Health, NHS England and NHS Improvement that “capping public-sector pay, renegotiating contracts and implementing income-generating activities” could save £6.7bn.

But Health Campaigns Together spokesman John Lister pointed out that “staff have already had six years of pay restraint with no end in sight. It’s time they stopped dumping on NHS staff and realised this is counterproductive.”