Our audit of NHS bodies’ 2025-26 accounts showed that six of the seven health boards breached their duty to break even over three years.

The 2025-26 accounts of the twelve NHS bodies present their financial positions fairly. However, six of the seven health boards again failed to meet their duty to break even over a three-year period. The Auditor General qualified his regularity opinion for those bodies because failing this duty means they have exceeded their authority to spend.

The three NHS trusts met the three-year break-even duty. So did Cwm Taf Morgannwg University Health Board, although the Auditor General qualified his regularity opinion for that body due to a separate issue relating to two interim executive directors being paid above the remuneration levels set by Welsh Government. The two special health authorities – Health Education and Improvement Wales and Digital Health and Care Wales – must break-even in each year, which they have done.

NHS Wales received £12.39 billion of revenue funding in 2025-26, up by £823 million on 2024-25 and some £2.63 billion more than in 2021-22. The 2025-26 funding was 3.8% more in real terms than in 2024-25 when accounting for general inflation.

In 2025-26, the annual deficit of NHS Wales was £199 million. That was £75 million higher than in 2024-25. The three-year cumulative deficit increased to £506 million (from £457 million in 2024-25).

Positively, agency staff expenditure fell again in 2025-26, and at £128 million was 61% lower than its 2022-23 peak. The majority of this spend, 73%, continues to cover staff vacancies, with around 15% supporting extra activity to help meet demand.

NHS bodies are having to deliver savings in an attempt to contain costs. Reported savings increased again in 2025-26 to £256 million. However, this was only £3 million more than in 2024-25, with recurring savings falling and outweighed by an increase in one-off savings. Overall, the NHS still relies too much on one-off savings, and the current savings profile is not enough to stem to tide of rising demand and other cost pressures, including around staff pay.

Health boards and NHS trusts also have a duty to have a Welsh Government approved three-year plan. The plan must set out how they will deliver the services required to meet their population’s health needs in the context of the funding available. Only one health board had their plan approved, Cwm Taf Morgannwg for the second year running. The three NHS trusts also had their plans approved. With most health boards still unable to produce financially balanced plans, the overall NHS deficit position is unlikely to improve in the near future.

Financial pressures, and the way they are responded to, can drive a focus on the short-term in-year position. But we have highlighted previously the need for longer-term planning, whole-system changes, and a stronger focus on prevention to help safeguard the financial future of the NHS.

Our updated NHS Wales Finances Data Tool 2025-26 is published today. It provides more detail about NHS bodies’ financial positions.