Additional challenges

Since our survey was conducted, two additional factors have emerged that are important to consider in the context of the 2026/27 financial challenge. 

Firstly, the survey was undertaken before the most recent round of resident doctor industrial action was announced, which took place between 7 and 13 April 2026. Industrial action affects an organisation’s ability to meet its operational targets and diverts leaders away from day-to-day activity such as delivery of cost improvement plans. 

It also impacts finances through the cost of paying staff to cover those 
on strike, and lost income due to the postponement of appointments and procedures. Industrial action was identified as a barrier to meeting 2026/27 financial plans by 66 per cent* of trust and ICB respondents. It is possible that this value would be higher if further industrial action had been scheduled at the time that respondents were completing the survey. 

Secondly, the war between Iran and the US began while the survey was live. This immediately pushed up energy prices and is expected to cause inflation during 2026/27, which will impact NHS finances. Inflationary pressures were identified as a barrier to meeting the financial plan in 2025/26, before the war started, by 85 per cent* of trust and ICB respondents and 96 per cent* of GP respondents. 

One respondent noted that “trusts are being asked to significantly improve performance while simultaneously [the government is] not fully funding inflationary pressures and activity growth” (deputy chief finance officer,  NHS trust/foundation trust). This is also felt by GP respondents, one of whom noted that “wage costs and inflation have a big effect on staff morale and the ARRS [Additional Roles Reimbursement Scheme] budget” (PCN manager). 

However, high levels of inflation do not only affect trusts by impacting their budgets. Work previously undertaken by NHS Providers exploring pressures during the cost-of-living crisis (from August and September 2022) found that 72 per cent of trusts quickly saw increased patient demand for mental health support due to stress, debt and poverty.

In addition, NHS staff members are impacted personally. Sixty-one per cent of trusts reported a rise in mental health sickness absence among their staff, and 71 per cent said they were being significantly or severely impacted by staff struggling to afford to come to work. 

If the Iran war does lead to a sustained increase in inflation, it is likely that budgetary impacts, higher demand and effects on staff will create further challenges to NHS leaders over the course of 2026/27.