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Welfare Reform on the Web (July 2006): National Health Service - funding

Acute hospitals may close, NHS chief warns

J. Carvel

The Guardian, June 14th, 2006, p.4

NHS acute hospitals may be closed in order to reduce the NHS’s £512m deficit. In an interview with the Guardian newspaper, the acting NHS chief, Sir Ian Carruthers said that services in certain large hospitals will have to be reconfigured in order to keep trusts within budget. He did not rule out hospital closures in these plans. It is thought that trusts in the eastern part of the country may bear the brunt of these cuts as they have the biggest deficit problem.

The big squeeze

C. Jackson

Mental Health Today, June 2006, p.8-9

The NHS is in deficit by £600-800m and has been told to balance its books this financial year by government. Financially prudent mental health trusts that have stayed within budget are being told to make savings to bail out overspent local acute hospitals.

Billions injected but NHS debt hits new high

G. Wilson and C.Hall

The Daily Telegraph, June 8th, 2006, p.1

The NHS is facing a financial crisis after it has been revealed that front-line trusts have run up a deficit of £512 million, which is more than double the previous year’s debt. However watchdogs were quick to note what the figures left out. The figure does not include the cumulative deficit since 1997 which stands at £598 million. The real annual figure could be at least double the £512 million stated as this includes trusts that have a surplus that totals £524 million. Watchdogs are also wary of the un-audited accounts published by the Health Department as previous un-audited NHS figures were considerably lower than audited financial results. The director of financial audit for health at the National Audit Office said that trusts with the biggest deficits may have to cut jobs and that patients may well suffer from changes in care provision. However, health ministers insist that the deficit is only 0.8% of the health budget. They also highlight the record level of spending on the NHS and general service improvement. Yet Patricia Hewitt, the Health Secretary, admits that “There will be difficult decisions to be made, particularly in the minority of trusts with substantial deficits”.

(See also, The Daily Telegraph, June 8th 2006, p.4 and p.21; the Guardian, June 8th 2006, p.6; The Times, June 8th 2006, p.6-7, Financial Times, June 8th, 2006, p.2, The Independent, June 8th, 2006, p.19).

Funding row could see1,800 patients rejected by foundation

K. McIntosh

Health Service Journal, vol.116, June 29th 2006, p.7

Bournemouth and Christchurch Hospitals Foundation Trust is refusing to accept non-urgent referrals of patients from its local primary care trust in a row over funding. The dispute concerns £6.3m which the Foundation Trust claims it is owed for work done in financial year 2005/06 and the failure to agree a contract for 2006/07.

Good buy to all that

A. Rossiter

Health Service Journal, vol.116, June 29th 2006, p.24-25

Government is increasingly withdrawing from direct provision of public services and instead commissioning them from the private sector. It therefore faces the new challenge of managing the work of the contractors to ensure that high quality services are delivered to taxpaying citizens at reasonable cost. Unfortunately civil servants lack the skills needed to manage complex contracts. However, the Department of Health and the NHS offer encouraging examples of improved procurement practices.

Sir Ian: intervene early and take tough decisions

N. Edwards

Health Service Journal, vol.116, June 15th 2006, p.16-17

The NHS deficit in 2005/06 amounted to £512m, down from £623m in 2004/05. The Department of Health now accepts that not all trusts will achieve financial balance by the end of 2006/07, but has set a new target of achieving in-month balance. The acting NHS Chief Executive, Sir Ian Carruthers, calls on managers of trusts in financial difficulties to intervene early, particularly by freezing recruitment.

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