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Contractors' service and staffing fears after 'another funding cut'

Raj Radia: Staffing will be affected in some way. Where do I cut?
Raj Radia: Staffing will be affected in some way. Where do I cut?

One contractor warned they may be forced to make redundancies and another has said pharmacy’s service delivery will be hampered after yesterday's funding freeze announcement.

Funding for England’s pharmacies will remain at its current level of £2.592 billion for the remainder of the financial year, the Pharmaceutical Services Negotiating Committee (PSNC) announced yesterday (October 22).

From November, contractors will see a reduction of 3p in the single activity fee – from £1.29 to £1.26 – and a category M clawback of £10 million a month until March 2019, the negotiator explained.

While PSNC stressed that the current funding level is “an improvement” on a £33m cut proposed by the government, the Royal Pharmaceutical Society (RPS) said taking inflation into account, the funding is “still effectively a cut”.

“We completely understand what a tough time the community pharmacy sector is going through right now and empathise with pharmacy owners working within a contractual framework that has, in real terms, seen another cut in funding,” RPS CEO Paul Bennett said.

The society’s English pharmacy board chair Sandra Gidley said the funding will “do little to relieve the pressure on pharmacies”.

However, she said she is “pleased that negotiation conversations have now started” and the RPS “looks forward to seeing developments move towards a contract based on services for next year’s settlement”.

“Do I make redundancies?”

Raj Radia, owner of Spring Pharmacy in London, said he is “devastated” that community pharmacies in England will not receive any more money to reflect their increasing workload.

“It’s going to be very hard going forward,” he told C+D. “Cashflow has been a real issue this year. How do you make the two ends meet?”

“The staffing will be affected in some way. Where do I cut? Do I make redundancies? It’s daunting.”

“No surprise”

Mike Hewitson, owner of Beaminster Pharmacy in Dorset, was also unimpressed by the funding announcement, but said it was “not a surprise”.

“The government may have shot itself in the foot, as I can only see it increasing pressure on pharmacies. It’s not going to make it any easier for us to deliver services.”

“We have got massive cost pressures: the Falsified Medicines Directive (FMD), living wage, rise of medicines costs, among others – all piling up and no recognition of that,” he added.

“It’s important contractors have faith in the checks and balances in the system so we can be confident it equates to fair delivery of funding.”

NPA: “Cat M most pressing concern”

The National Pharmacy Association (NPA) said while it understood “why PSNC has accepted the Department of Health and Social Care (DH)’s offer”, the agreement will be a “disappointment to many of our members”.

“[PSNC’s] rationale is in part to demonstrate a desire to develop constructive relationships with government, as the basis for positive developments in pharmacy policy and commissioning,” it said.

However, the “most immediate concern is the impact of the category M clawback, which could impair cashflow”.

The sector needs a “long-term settlement” that has more certainty, as well as “clarity from the government about their ambitions for the sector”, the NPA added.

Well: “A significant challenge”

Well Pharmacy also emphasised the importance of the government’s relationship with the sector, and said rebuilding this must be the priority, with the “aim of providing certainty for contractors”.

“The financial climate in community pharmacy continues to pose a significant challenge to contractors,” CEO John Nuttall said.

“The ongoing challenge of category M clawback leads to instability and uncertainty in the market, and needs to be addressed by a new funding model,” Mr Nuttall stressed.

CCA “pleased” there are no more cuts

The Company Chemists’ Association – which represents Boots, Lloydspharmacy, Well, Rowlands and Superdrug, as well as the pharmacy arms of Morrisons, Tesco and Asda – said it is “pleased that there will be no further cuts”, but “does not underestimate the financial challenges that all contractors currently face”.

“Our members look forward to working with government in the coming months and years to help design and evolve the pharmacy contract to deliver the best possible service for patients and the public,” said chief executive Malcolm Harrison. 

Twitter reaction

Read C+D editor James Waldron's thoughts on the funding announcement here.

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How will your pharmacy cope with the ongoing funding pressures?

Mustafa Bhaiji, Superintendent Pharmacist

I think it's time that we replaced the whole of the PSNC committee with people who are willing to play hard ball with the DHSC. Too many concessions for as long as I can remember. Whilst the PSNC carry on as they are, the DHSC will continue to erode our funding, and ultimately completely marginalise the profession. We have to take firm action now. We must stop giving in. The PSNC has to recognise how bad things are. I have no idea what the contractor PSNC committee members are doing... 

Leon The Apothecary, Student

Unpopular Idea (Maybe): To remunerate the cuts, pharmacies reintroduce unpaid lunch hour and close during this time.

Work on a rough figure of a pharmacy open for five days a week, 9-6pm, hiring two staff at £10ph and a Pharmacist at £20. You save £10,400 annually.

Sure, patients suffer a reduction in service as a result, but one could argue that's on the DoH's hands.

SIMON MEDLEY, Community pharmacist

its bad news when we have to feel grateful for a real terms cut in an arena of increasing workload and overheads- its a bit like being in an abusive relationship and being thankful for only being beaten where the bruises don't show

Chicken Little , Pharmacy owner/ Proprietor

PSNC value for money....?


2014/15 CEO salary band (excluding significant pension) from £200,000 to £225,000

2015/16  CEO salary band (excluding significant pension) from £250,000 to £255,000.

2016/17 CEO salary band (excluding significant pension)  band from £260,001 to £270,000.


Further more... Rest of the salaries of PSNC excl CEO...

2017: 38staff; £1,480k salaries (exc CEO), ave £39.0k pa

2016: 38staff; £1,437k salaries (exc CEO),, ave £36.2k pa

2015: 38staff; £1,205k salaries (exc CEO), ave £31.7k pa

Gravey train.... 

Adam Hall, Community pharmacist

Cuts to funding but they want pharmacy to alleviate growing pressures on GPs - Which is it? Sadly, Matt Hancock is no better than Jezza Hunt - fine words then cuts the cash!

Keith McElrea, Pharmaceutical Adviser

This is incredible lack of foresight from the DoH.  In scotland we are well down the path of our Pharmacy First Model and although it is funded, we are already finding, previously well staffed pharmacies swamped with the need for triaging patients.   The workload has risen exponentially and continues to do so, and while we welcome being an integrated part of the NHS in Scotland rather than the "If I'd had another minute I'd have spent it talking about pharmacy" afterthough which pharmacy in England seems to be to the new Health Minister, we are still struggling with the sheer swell of volume that is coming our way.  How NHS England expects Pharmacies to maintain reasonable staffing levels while continuing to cut funding is ridiculous.  It takes time to train qualified pharmacy staff and it takes money.  There needs to be sufficient remuneration for pharmacy owners to invest in their businesses for the future.

N O, Pharmaceutical Adviser

Off topic, but will FMD affect GPs (for all the stock they buy) and the Dispensing Doctors ?? or is it just the Community Pharmacies ???

I think this is their latest guidance

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