David Mowat announces community pharmacy cuts in House of Commons

Community pharmacy funding will be cut by 4% for 2016-2017 to £2.687bn, and a further 3.4% cut will be made for 2017-2018, health minister David Mowat has announced.

David Mowat, pharmacy minister

Health minister David Mowat has set out the government’s planned cuts to community pharmacy in a statement to the House of Commons, dashing the sector’s hopes that the plans would be rethought.

From 1 December 2016, community pharmacy funding will be cut by 4% for 2016-2017 to £2.687bn — representing a cut of 12% for the final four months of 2016-2017 — and a further 3.4% cut will be implemented for 2017-2018, which will reduce funding to £2.592bn.

Originally, the government planned to cut the community pharmacy budget by 6% from October 2016, but this was delayed following Brexit and changes in government.

In an attempt to justify the cuts, Mowat told the House of Commons that overall pharmacy spend has increased by 40% over the last decade and now stands at £2.8bn per annum. He also pointed out that over the same time period, the number of pharmacies has increased by over 18%, to over 11,500.

“We do not believe that the current funding system does enough to promote either efficiency or quality. Nor does it promote the integration with the rest of the NHS that we, and pharmacists themselves, would like to see,” he said.

“The average pharmacy receives nearly £1 million per annum for the NHS goods and services that it provides, of which around £220,000 is direct income. This income includes a fixed sum payment, called the establishment fee, of £25,000 per annum, for most pharmacies, regardless of size and quality.”

He said that this was an inefficient allocation of NHS funds considering that 40% of pharmacies are now in clusters of three or more and within ten minutes’ walk of each other.

“At a time in which the overall NHS budget is under pressure and we need to find £22bn in efficiency savings, it is right that we examine all areas of spend and look for improvements,” he added.

Pharmacies in areas with fewer pharmacies and higher health needs would be fully protected from the impact of the cuts through a pharmacy access scheme, Mowat said. “This list includes all pharmacies which are more than one mile in distance from another pharmacy.” Overall, 1,356 pharmacies will receive funding from the scheme, which have been listed.

There will also be a review process “to deal with any unforeseen circumstances affecting access [to pharmacies]; like a road closure”, and cases where there may be a high level of deprivation, but where pharmacies are less than a mile from another pharmacy.

“This will cover pharmacies that are located in the 20% most deprived areas in England, are located 0.8 miles or more from another pharmacy and are critical for access,” he said, emphasising that additional funding over and above the base settlement “will be made available as needed”.

Keith Ridge, the chief pharmaceutical officer for England, said: “The public can be reassured that while efficiencies are being asked of community pharmacy just as they are of other parts of the NHS, there is still sufficient funding to ensure there are accessible and convenient local NHS pharmacy services across England. The NHS is committed to a positive future for pharmacists and community pharmacy.”

Last updated
The Pharmaceutical Journal, PJ, October 2016, Vol 297, No 7894;297(7894):DOI:10.1211/PJ.2016.20201855

You may also be interested in