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Paying back the £370m Covid funding: ‘We would have to close all of our branches’


By Isabel Shaw

24 May 2021

Community pharmacies in England are due to pay back a £370m Government loan later this year, but many contractors are concerned they will struggle to cover the costs.

The funding was given to contractors in three parts between April and July 2020, as advance payments to support pharmacies with the cashflow pressures caused by the Covid-19 pandemic.

In March last year, the chancellor said the NHS would get ‘whatever it needed’ to tackle the pandemic. However, despite the Pharmaceutical Services Negotiating Committee (PSNC) asking the Treasury to write off the £370m — at the time of writing — it has not yet agreed to wipe the debt clean. 

In earlier discussions, the Government offered the sector an undisclosed sum, but PSNC said it had rejected this on the basis of it being ‘far too limited’.

The Department of Health and Social Care (DHSC) confirmed last week (21 May) that discussions on pharmacy funding currently remain ongoing.

In response to the growing concerns over pharmacy finances, the Pharmacist surveyed contractors on their experiences of Covid-19-related costs and the overall burden of the pandemic.

This is what pharmacists who took part in our survey told us about the impact having to repay the Covid loan will have on their pharmacy:

Closures

‘I am currently having to sell the business because if I had to repay this loan the business will go into administration.’
 
‘We will be forced to close.’
 
‘We would have to close down, we cannot survive.’
 
‘Closure of our smallest pharmacy site.’
 
‘We would have to close all of our branches and put many people out of jobs.’

More cashflow issues, cuts and financial strain

‘It will have a huge effect on cashflow. Pharmacy needs this payment – we should not have to be penalised for actually staying open and serving patients throughout the pandemic. We could not close our doors like GPs – in fact, we helped those who wouldn’t be seen by a GP. And still do.’
 
‘Sadly it will add to my overdraft, which is already running at £50,000.’
 
‘I will not be able to manage this return, it will be a real financial drawback – I will have to fund it by borrowing back from the bank.’
 
‘It will put us under a lot of financial strain, and potentially lead to job cuts.’
 
‘[The impact will be] Devastating as increased cost of delivering and decreased sales all hitting our profit.’
 
‘We may well suffer cuts in staffing and hours.’
 
‘We will have to reduce staffing.’
 
‘We will have to scale back services, including delivery, and make staff cuts.’
 
‘It will be devastating to have to repay the Covid payments.’

 

Patient care

‘Will stop services we do not get paid for – deliveries, blood pressure monitoring, non-referred minor ailments, [which are] not through [the] Community Pharmacy Consultation Service (CPCS). Will also reduce opening hours and if necessary reduce staff.’
 
‘We will really struggle and will have to make hard decisions which will affect patient care.’
 
‘It will put a huge strain on us financially and many pharmacies will struggle to cope. It will make things a lot tighter and stop us from improving our services and ultimately providing better care.’
 
‘This would be devastating. We have incurred extra costs and decreased OTC sales to cover cost of providing NHS services. We have been open throughout, even when very difficult. It is a real slap in the face for the sector.’

More on this story

Pharmacies facing ‘devastating’ impact of Covid cost pressures, survey finds
Over 10,000 pharmacies order Covid tests for staff
Pharmacists on mental health impact of Covid: ‘The pressure has been tremendous’

The Pharmacist’s Covid pressures survey was carried out between 2 March and 12 April 2021. It received a total of 100 respondents, but where response rate varied by question this has been specified in the article. 


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