In a stark warning to the healthcare sector, scores of UK independent pharmacies are teetering on the brink of closure amid a surge in operational costs. The National Pharmacy Association (NPA) has raised the alarm that the 6,000 independent community pharmacies it represents are facing unprecedented financial pressure. According to the NPA, many pharmacies are now staring down a shortfall of around £100,000 per year—a gap that threatens their very survival.
The crisis is being driven by what industry experts describe as a “triple whammy” of escalating costs. With the Chancellor’s planned hike in National Insurance looming in April, pharmacies are also grappling with rising National Living Wage expenses and increased business rates, reported the Express.
The additional burden is expected to compound an already critical funding situation. Rachel Reeves’ decision to raise National Insurance is set to exacerbate an estimated £250 million funding shortfall across the sector, potentially forcing essential prescription outlets to shutter their doors.
GB News has reported that many pharmacies are already “hanging on by their fingernails” as they struggle to keep pace with soaring expenses even before the new tax increases take effect. Nick Kaye, the chairman of the NPA, underscored the urgency of the situation, stating:
“Pharmacies face a financial cliff edge at the beginning of April, with a triple whammy of rising National Insurance, National Living Wage and business rates all arriving at once.” He further added, “At the moment, they still have no certainty if any of these costs will be met by the Government, despite assurances for other parts of the health system including our GP colleagues.”
Adding to the concerns, Dr Nick Thayer, head of policy at the Company Chemists’ Association, explained:
“Each pharmacy in England now faces an annual funding shortfall of at least £100,000.”
This fiscal squeeze is particularly acute as the funding allocated for dispensing medications has remained unchanged, even as drug costs and other business expenses continue to rise. The cumulative effect has led to a troubling trend: over 1,200 pharmacies have closed since 2017, with higher closure rates noted in more deprived areas.
The mounting pressures have spurred unprecedented action within the sector. A historic ballot by the NPA revealed that 99.7% of its members would support collective action to rectify the funding imbalance. Yorkshire-based pharmacist Ashley Cohen provided a personal account of the struggle, revealing that he had to borrow significant sums to keep his operations afloat.
He noted: “This year alone, I’ve had to borrow an extra £125,000 to keep me going, and that is just for my small group of pharmacies.” He warned further, “There will come a point where I can’t keep borrowing, remortgaging the house, raiding pension pots or putting money into a business or a profession that isn’t being valued.”
In response to the crisis, a Department of Health and Social Care spokesperson emphasized the essential role of community pharmacies. The spokesperson stated: “Community pharmacy has a vital role to play as we shift the focus of the NHS out of hospitals and into the community, through our 10-year health plan. We will work with the sector, making better use of the skills of pharmacists and pharmacy technicians, to build a service fit for the future.”
As the financial challenges deepen, the coming months will be critical for these vital community health providers, whose fate now hangs in the balance.
