Pharmacy funding for 2021/22 remains unchanged at £2.59bn; stakeholders disappointed

The government has kept funding for the Community Pharmacy Contractual Framework (CPCF) unchanged at £2.592 billion for the year 2021/22, keeping the allocation same for the third year in a row.

This follows an intensive period of tripartite negotiations, lasting around three months between the Pharmaceutical Services Negotiating Committee (PSNC), NHS England and NHS Improvement (NHSE&I) and the Department of Health and Social Care (DHSC), in line with the five-year CPCF deal.

PSNC, along with other stakeholders in the sector, has expressed disappointment over HM Treasury’s “flat rejection” to the funding uplift demand.

PSNC stated today (August 23) that it would continue to pursue the demand.

Thorrun Govind, chair of the English Pharmacy Board, said: “Pharmacists have been on the frontline throughout the pandemic. We are disappointed that the positive impact demonstrated by community pharmacy has not been recognised through increased investment. This is a real terms funding cut delivered through the frozen core funding. Pharmacists working in community pharmacy will understandably be demoralised by this.”

Dr Leyla Hannbeck, chief executive of the Association of Independent Multiple Pharmacies (AIMp), said: “We are disappointed that there is no uplift despite inflation, salary and other costs rising. This is yet another decrease in funding so let’s please call it that.

“While it is great to see more clinical services being delivered through community pharmacy, and we welcome that, AIMp has raised concerns with NHSE/I about the ongoing lack of a level playing field for community pharmacy as GPs get funding to recruit pharmacists to GP practices and this has significantly impacted on community pharmacy and indeed hospital pharmacy workforce making it increasingly more challenging for the sector to deliver services.”

Meanwhile, the payments have been agreed on the basis that the government would support contractors as they engage with Primary Care Networks (PCNs) and Integrated Care Systems (ICSs), and consider digital transformation and dispensing efficiencies.

Besides, the PSNC confirmed that it has won additional funding for a new hypertension case-finding service, which will be commissioned as an advanced service from 1st October 2021.

The hypertension case-finding service will be funded separately by NHS England and NHSE&I to encourage pharmacy teams to find cases, and additional information, guidance and support materials will be made available to contractors soon, PSNC said.

It highlighted other positives of the deal.

“The continuation of the Transitional Payments; feasibility of the Pharmacy Quality Scheme (PQS) requirements; and big steps forward on services, including with some monies coming from outside core funding, are all critical for the sector over the coming year. This agreement also sits alongside the separate Covid costs deal that allowed contractors the chance to claim for their Covid-related costs,” PSNC stated.

It further highlighted progress on service development with the expansion of the New Medicine Service (NMS) along with introduction of two new Advanced Services – a Smoking Cessation Service and Hypertension Case-Finding.

“There are some positive steps on supporting pharmacists’ clinical role, including blood pressure diagnosis, and the expansion of the New Medicines Service,” Govind said.

“We know that community pharmacy can play a key role in helping manage increasing demand on the NHS, but collaboration and support for implementation will be key to making new services a success,” she added.

The Pandemic impact

PSNC noted that the Covid-19 pandemic has impacted heavily on negotiations. During the negotiations, it has used its analysis and data to reveal the impact of the pandemic on contractors’ costs.

“Although our arguments for a funding uplift were rejected this year and funding remains set at £2.592bn, we have gained a commitment from all negotiating parties to carry out a review of Years One and Two and will continue to press on this matter,” it said.

It noted that finances remain difficult for many pharmacies, particularly with the upcoming repayment of the Covid-19 Advance Payments, and the pandemic has increased some operating costs irreversibly.

“...we will continue to lobby on this both through the negotiations and more widely through Parliament and the media,” PSNC stated.

In response to the CPCF update earlier today, Andrew Lane, chair of the National Pharmacy Association, welcomed "the introduction and expansion of a number of clinical services" but expressed the pharmacy negotiator's "request to Treasury to resolve the long-term funding crisis facing pharmacies in England" was overlooked.

“Last year the NPA commissioned a report from Ernst and Young (EY) that showed the precarious situation facing pharmacies up and down the country. It said community pharmacies face a funding gap of half a billion pounds and nearly three-quarters of family-owned pharmacies in England could be forced to shut their doors by 2024. Simply put, these new funding arrangements do not address the fact that 72 percent of pharmacies in England are forecast to be loss-making within four years, as the EY report has highlighted.

“Community pharmacies are a local lifeline. They provide vital health and social care in communities across the country, including the most deprived neighbourhoods. The long-term investment needs to be resolved so that alongside the expansion of clinical services from community pharmacy a sustainable plan for the future can be developed.

“We are also disappointed to see that there is no new support for the important work of community pharmacists engaging with PCNs.”

Commenting on the announcement, Malcolm Harrison, chief executive of the Company Chemists' Association, welcomed the "opportunities presented by the expansion of NMS, and the Hypertension Case-Finding service" which he argued would help pharmacy transition into "a more clinically-led future".

"We also welcome the news that the transitional payments have been protected for another year, however the annual review process will be critical in providing a further opportunity for the sector to highlight the true cost of providing core pharmacy operations for the NHS, and its essential this is reflected in future settlements."

Harrison, however, was "disappointed that the bid for an uplift in funding for the sector has been rejected."

He added: "Against a backdrop of flat funding and increasing costs, the sector has repeatedly demonstrated to patients, the NHS and the government how valuable community pharmacies are to the nation, even more so over the course of the Covid-19 pandemic.

"The refusal to increase the funding available for pharmacies to deliver NHS services is compounded by the fact that any efficiency gains promised as part of the five-year deal have not yet materialised."