Press release: NHS Confederation responds to Health Select Committee report on deficits
13 Dec 2006
Commenting on the Health Select Committee's report on NHS deficits, Dr Gill Morgan, chief executive of the NHS Confederation, said:
"It is a shame that the Health Select Committee has taken the easy route of blaming NHS managers for all the financial problems in the NHS. Trusts across the country have transformed services with patient satisfaction at high levels.
"We need to look at the whole picture and not make NHS managers the scapegoat for the financial problems facing some trusts.
"As the Select Committee recognises, there are a number of reasons for NHS deficits. Short-term pressures such as national targets and workforce reforms have put enormous strain on the service. And longer-term issues such as unresolved structural problems have been exposed by changes to accountancy rules.
"NHS managers put their patients first, and are working hard to reduce the deficits and to re-balance the workforce without impacting on care. Trusts have many different priorities, but the Government has made clear that achieving financial balance is the most important. Some trusts may have to make difficult decisions in the short term about how to reduce spending.
"The NHS faces a hugely demanding agenda including the urgent clinical need to reconfigure services, meeting the 18 week waiting time target, as well as the new objective set by the Department of Health yesterday of achieving a net surplus of £250 million by March 2008.
"All of this will be very challenging for the NHS, and we are disappointed by the Government's failure to address the Resource Accounting and Budgeting (RAB) rule which in effect penalises trusts in deficit twice. We welcome the committee's recommendation that the RAB is replaced or refined and that we avoid taking trusts' resources away through 'top slicing'."
Notes for editors
1. The Resource Accounting and Budgeting (RAB) principle means that if a trust reports a deficit in one year, its income is reduced by that amount the following year. In addition to receiving less income the following year, the trust also carries forward the original deficit onto next year's balance sheet. This is known as a double deficit.
2. The NHS Confederation represents more than 90% of the organisations that make up the NHS. Its members include the majority of NHS acute trusts, ambulance trusts, foundation trusts, mental health trusts, primary care trusts, special health authorities and strategic health authorities in England; trusts and local health boards in Wales; and health and social service trusts and boards in Northern Ireland.
Contact details
Contact Media Relations Manager Joanna Clason on 020 7074 3306 or 07798 571078 or Senior Media Officer Amy Darlington on 020 7074 3304 or 07767 770309.
Back to media centre
