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COVID-19: English pharmacies to get further £50m in 'advance funding'

Simon Dukes: Cash injection "should help to ease some of the immediate cashflow pressures"
Simon Dukes: Cash injection "should help to ease some of the immediate cashflow pressures"

Community pharmacies in England will receive a further £50 million in “advance funding” in recognition of the “cashflow crisis” they are facing due to COVID-19, PSNC has announced.

“The intention“ is that contractors will receive the £50m at the same time as their planned NHS Business Services Authority payment on June 1, the Pharmaceutical Services Negotiating Committee (PSNC) announced today (May 28).

This is the most recent of three advance payments that PSNC has secured from the Department of Health and Social Care (DH) in a bid to ease COVID-19 related cashflow challenges in the sector. The first two of these payments – totalling £300m – were made to contractors on April 1 and May 1.

Earlier this month (May 19) the DH announced it would increase Category M reimbursement prices by £15m in June.

“Extra funding” needed

PSNC said it is also raising awareness of the “urgent need”  for extra funding for the sector with the NHS and the government and it is trying to “prevent contractors having to repay any of the advance payments that they have so far received this year”.

The negotiating body has submitted a bid for extra funding to the Treasury and will update contractors on it “as soon as we can”. PSNC CEO Simon Dukes said it is “frustrating that these negotiations are taking some time” but that the organisation is “continuing to press for answers”.

Commenting on today’s announcement, Mr Dukes said the latest cash injection, coupled with the £15m increase in category M prices in June "should help to ease some of the immediate cashflow and procurement pressures on businesses”.

Should be “new money”

Professor Claire Anderson, England board chair at the Royal Pharmaceutical Society, said the advance payment “may help pharmacies” to continue to provide essential services but is “another stop-gap measure and should be coming from new money, rather than an advance payment”.

“The Government should review this as part of a fair funding settlement for the longer-term,” she said.

National Pharmacy Association CEO Mark Lyonette said the latest cash advance “increases the level of pharmacies’ debt to government” and many contractors “will struggle to pay it back and should never be asked to do so”.

“It is now more urgent than ever that the government fulfils commitments to repay all the extra costs incurred by pharmacies during the COVID-19 pandemic,” he said.

Do you welcome this announcement?

C A, Community pharmacist

Dear PSNC, being that we are already seeing Pharmacy closures - "Oxford pharmacy forced to close" C&D 03/06/20 - what will happen when Pharmacy has to repay this advanced funding?


Eddy Lau, Superintendent Pharmacist

It's like a pat on the back with the one hand and  then slap our face with the other.

Kevin Western, Community pharmacist

only without the pat on the back...

Kevin Western, Community pharmacist is probably a good place to start when you want to vent re DoH and NHSE

Dipak Pau, Community pharmacist

This advance payment is in recognition of the fact the the cost of drugs have increase dramatically this year and the DHSC steadfastly refused to grant appropiate price concessions for so many products and even when they eventaully granted the price concessions were a true reflection of the market. Therefore the short term advance payments will increase their cahs flow in the short term. However in the following months, the NHS payments will be be reduced leading to a dramatic cash flow crisis. What do we then!!

The 15 Million increase in Cat M are already being swallowed up by wholesalers price increases. As soon as this Cat M increases were announced, there was an increase in the drug costs. So we lose again.

The PSNC just doesn't get it. The  advance payment should not be a loan but a payment. With the background of Pharmacies stayed in the front line, didn't stop patients accessing their services, provided free delivery services to patients who didn't want to risk their health by going to the pharmacy ( Pharmacy teams must have had a magic potion or pill to stop them from being at risk), lack of PPE and even opened on Bank Holidays, the PSNC still could not manage to persuade the DHSC that the money had to be paid not as a advance payment but a true payment- new money.

And yet the PSNC trumpets this advance payment is a victory. The chickens are going to come home to roost very soon.

SP Ph, Community pharmacist

Why do we need an advance payment ??

Any business can avail the Bounce Back Loan Scheme up to £50,000 @ just 2.5% interest fixed. Govt pays first 12 months of Interest and no Capital payment for the first 12 months.

I can't think of any Pharmacy with turnover less than £200,000 to make the maximum of £50,000 loan (25% of turnover) And even if you struggle to pay after 12 months, the banks cannot use the usual force to recover the money as the guarantee is provided by the Govt.

These advances are just putting a plaster on a Broken Heart. Very sad the Govt has not yet realised how broken the community pharmacy sector is at this miment.


C A, Community pharmacist

A 0% loan is better than a 2.5% loan? 

Leon The Apothecary, Student

So the issue still remains, but it will happen later. I feel a recession coming on.

Soon-To-Be Ex-Pharmacist, Superintendent Pharmacist

I think we are recessing as we speak!

Dave Downham, Manager

£350m - we'll get that back in 1 week when we Brexit properly, so will be less than 2% of the annual saving we'll make. Surely this trustworthy, honest and principled government wouldn't begrudge us that?

A.S. Singh, Community pharmacist

DHSC must take Pharmacy contractor for mugs. Advance in funding is basically a short term interest free loan and will only make things worse! PSNC are a bunch of useless beaurocrats. 


I can picture them now walking out of that meeting, fists pumping, rejoicing at the £50m advance

Soon-To-Be Ex-Pharmacist, Superintendent Pharmacist

It's just a headline grabber which makes it look like they are doing something positive for pharmacy. All this will do is postpone the inevitable for a little while until it all has to be paid back, but things will have moved on politically by then so they can keep it all under the radar.

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