This year is going to be tough for GP practices financially.  What will the impact of these financial challenges be on PCNs?  Will PCNs finally come into their own as a (now necessary) mechanism for joint working between practices and enabling economies of scale, or will tensions between practices and PCNs simply rise?

The scale of the financial challenge facing GP practices this year is unprecedented.  The 2% contract uplift takes no account of the rise in the minimum living wage, and the inflationary uplift of 1.65% bears no resemblance to the inflationary pressures practices are facing.  Whilst this is the third consecutive time a contract with real terms cuts has been imposed, it is the first time it has not been at least partially offset by increased investment in the PCN (the funding of which has similarly been frozen).

The impact of these financial challenges will not be limited to practices.  PCNs will also be affected.  When the finances of any organisation come under pressure then there is frequently a knock on impact on collaborative working.

How will practices respond? They will understandably prioritise core activities over any collective PCN activities.  Where resources are limited practices will focus internally and if something has to go then it will be most likely be the PCN work.

The tolerance for ARRS staff carrying out PCN work as opposed to supporting practices with their core work will most likely reduce.  It is already increasingly common to find practices calling for ARRS staff to be allocated on a ‘per practice’ basis rather than working as teams on PCN work.

Many ARRS staff were employed during and immediately after covid which, along with the lack of available space in GP practices, meant that many were employed to work virtually for some or all of the time.  But the usefulness to practices of staff working remotely is generally less than those delivering in-person services, and so now we are seeing a push for less of these virtual working arrangements.

When resources are limited organisations generally become more risk averse.  So while the opportunity for joint working and initiatives for collective benefit via the PCN still exists, the willingness of practices to put time and resource into a new way of working with an uncertain outcome is likely to be less.

Shared ventures require some form of shared overhead in order to be effective.  But practices will increasingly see this as being an unnecessary expenditure, with a growing belief that it would be cheaper (more profitable) for the service to be delivered in house by the practice.  As a result practices who were previously supportive of PCN or federation delivered services (like enhanced access) are now starting to consider providing these services directly themselves.

Financial instability also impacts trust.  When practices doubt whether the other practices in the PCN can fulfil their obligations or contribute meaningfully to shared goals then when times are tough commitment can wane quickly.  Practices that have this sense that they are “carrying” some of the other practices in the PCN are likely to pull back from PCN activities when they come under financial pressure themselves, with obvious consequences for the PCN as a whole and its ability to function effectively.

So the natural tendency of such an environment is to impact negatively on collaborative working, but this does not mean that it is inevitable.  It makes good logical sense for practices to pool resources and to share the burden of financial constraints as together they can achieve more than they can individually.

But PCNs will need to be focussed.  Ignoring the financial challenges faced by member practices will not work.  Instead, PCNs will need to take a much more practice focussed approach to collaboration, focusing on measurable outcomes and making a tangible impact. Activities and investments will need to be aligned with objectives and priorities agreed with practices in advance.

A tough financial environment is difficult for everyone.  Working together in PCNs is a viable strategy for practices to cope with this environment, but it will not happen by itself and PCNs will need to work hard to prevent the default option of practices withdrawing from collaborative work and focussing on themselves.