Kent and Medway ICB Declares ‘Very Serious’ £198 million Deficit as Budget Forecast Worsens

The Kent and Medway Integrated Care Board (ICB) has announced a significant financial shortfall, dramatically revising its 2025/26 year-end forecast from a planned break-even to a "very serious" £198 million deficit. This approaching £200 million hole is primarily attributed to delays and shortfalls in delivering cost improvement programmes and the anticipated loss of roughly £49.3 million in deficit support funding from national sources. An internal review further identified materialised risks exceeding £148 million, largely driven by provider deficits in acute trusts, particularly a large overspend at Medway Foundation Trust.

In immediate response to this unprecedented financial pressure, the Kent and Medway ICB has taken several urgent steps. These include an Executive Leadership Change, with the replacement of the chief finance officer and the initiation of recruitment for a system financial recovery director. They have also engaged the accountancy firm EY for an External Review to analyse the root causes and recommend cost-containment actions. Furthermore, the deficit has triggered a comprehensive Spending Review of both recurrent and non-recurrent expenditure, with the goal of tightening controls on non-essential spending while prioritising vital services.

This financial predicament mirrors a national challenge, as many ICBs across England struggle to meet financial targets set by NHS England amid escalating demand, inflationary costs, and difficulties in achieving efficiency savings. A deficit of this scale carries severe implications, potentially jeopardising the ICB's legal duty to deliver a balanced budget. 

If not swiftly addressed, it could lead to reduced investment in service development, delays in rolling out new care pathways, and less flexibility in responding to the specific needs of the local population. Health leaders emphasise that managing these pressures requires a dual approach: short-term financial controls coupled with a longer-term strategy focused on productivity, demand management through strengthened preventative and community care, and greater integration.