Healthy Lives, Healthy People: Update on Public Health Funding
Department of Health, 14 June 2012
This DH document outlines the latest developments in relation to public health funding allocations, the conditions attached to the ring-fenced resources and the health premium. The independent Advisory Committee on Resource Allocation (ACRA) has produced interim recommendations for the allocation of public health funding to local authorities, taking into account relative needs, inequality alleviation and health improvement. Key points include:
- The consultation indicated a 'strong preference' for an outcomes-based approach, with ACRA advocating funding based upon standardised mortality ratios (SMRs) for people aged less than 75. ACRA determined that the decile of areas with the highest SMRs should have a weighting threefold the size of the decile with the lowest.
- An Area Cost Adjustment (ACA) should be applied for 'unavoidable differences in the costs of delivering services.'
- It is proposed that funding will be comprised of three elements: mandated services (e.g. sexual health, NHS Health Checks, health protection); non-mandated services (through the health premium); and drug treatment services (currently commissioned by Drug Action Team partnerships). Local authorities will have the autonomy to prioritise spending.
- It is stressed that ACRA 'only made recommendations on relative shares for each local authority, not absolute monetary values.'
- The DH would like to reward councils 'furthest below the preferred distribution' more growth, provided resources are available and they are 'delivering value for money and a smooth transition.'
- ACRA have highlighted areas that require further examination prior to determining the final allocations formula. These include age adjustments, non-resident populations and fixed cost adjustments.
In relation to the health premium, the DH acknowledges that 'a lot of concern was expressed about the precise working of any scheme.' It is confirmed the first payments will now not be issued until 2015-16, which will provide ACRA with the opportunity to mitigate the risk of a 'perverse incentive' coming into effect. Moreover an 'expert group' will be tasked with evaluating the suitability of Public Health Outcomes Framework indicators for elements of the health premium. Final decisions will be made by the Secretary of State.
The document underlines that the public health grant should 'be spent on activities whose main or primary purpose is to impact positively on the health and wellbeing of local populations, with the aim of reducing health inequalities in local communities.' Nevertheless local authorities will have the option of pooling the grant with other resources where appropriate, while ensuring the spending 'is proportionate to the public health benefit to be derived.' Grant conditions will specify reporting requirements, with an anticipation that annual expenditure will fall into between fifteen and twenty areas.
The DH plans to produce the actual public health allocations by the end of this calendar year. However it is seeking feedback on its proposals by 14 August to inform the ongoing work of ACRA as it hones the final set of recommendations.
