Tuesday, December 12, 2006
NHS ILLS
GOVERNMENT HAS GONE INTO NHS TARGET OVERDRIVE
The NHS in England has been told it must achieve a £250m surplus next year. The service ended the last financial year £512m in deficit, but Health Secretary Patricia Hewitt MP has pledged to balance the books this year.
Waltham Forest Lib Dem Councillor John Beanse, who is Vice-Chair of Health Scrutiny, said:
"The Government has gone into target overdrive. How can hospitals already at financial breaking point be expected to chase new targets while trying to dig themselves out of the cycle of debt imposed by Labour’s Alice in Wonderland accounting rules*[see below]? Patients will lose out in the struggle between hitting targets and achieving financial balance, as hospitals will face no option but to cut vital services. For many trusts, including our own local Trusts, breaking even by next year will not be possible without continuing to cut staff numbers and services. The damaging accounting rules which mean deficits have to be repaid twice must be urgently reformed if the NHS is to put an end to debts."
[Under RAB rules (Resource Accounting and Budgeting), if a Trust spends say £105m one year, but has an income of £100m it would end the year with a deficit of £5m. The rules would then slice £5m from its income in the following year and also oblige it to make a £5m surplus. So the Trust would be obliged to cut its net spending from £105m to £90m - described by "The Guardian" as a "triple whammy".]
The NHS in England has been told it must achieve a £250m surplus next year. The service ended the last financial year £512m in deficit, but Health Secretary Patricia Hewitt MP has pledged to balance the books this year.
Waltham Forest Lib Dem Councillor John Beanse, who is Vice-Chair of Health Scrutiny, said:
"The Government has gone into target overdrive. How can hospitals already at financial breaking point be expected to chase new targets while trying to dig themselves out of the cycle of debt imposed by Labour’s Alice in Wonderland accounting rules*[see below]? Patients will lose out in the struggle between hitting targets and achieving financial balance, as hospitals will face no option but to cut vital services. For many trusts, including our own local Trusts, breaking even by next year will not be possible without continuing to cut staff numbers and services. The damaging accounting rules which mean deficits have to be repaid twice must be urgently reformed if the NHS is to put an end to debts."
[Under RAB rules (Resource Accounting and Budgeting), if a Trust spends say £105m one year, but has an income of £100m it would end the year with a deficit of £5m. The rules would then slice £5m from its income in the following year and also oblige it to make a £5m surplus. So the Trust would be obliged to cut its net spending from £105m to £90m - described by "The Guardian" as a "triple whammy".]
# posted by John Beanse @ 4:44 PM 
