Wednesday, June 07, 2006

Latest On NHS Financial Mire

Commissar Hewitt addressing Parliament

The Commissar has given her long-awaited update on those NHS deficits. According to her the net deficit is "only" £512m, not the £1bn some had claimed. But as always, the headline number deliberately disguises a multitude of Sins:
  • The gross overspend is £1.27bn, but the Strategic Health Authorities have been pressured into "saving" £75om. That's come from cutting spend on such fripperies as training and probably anaesthetics. And those 12,000 posts that are going are not just in deficit trusts.
  • £512m is still way over the £250m the Commissar promised just a few months ago
  • These are still provisional numbers -last year the final figures were revised up substantially
  • The 11% of Trusts that apparently account for 70% of the deficits are all down South. Pat says that's because they're Crap at managing, and she's not prepared to tolerate the "unfairness" of letting rich areas run deficits when poor areas manage within their budgets. The truth is that the South's deficits reflect the fact the DH budget allocations do not give sufficient weight to their higher local costs. It is another example of Labour diverting money towards its own constituencies (see our numerous blogs on vote buying).

Plus of course, the Commissar has still not actually explained how the deficit trusts are meant to manage going forward. It's totally unrealistic to expect them to claw back historic overspends anytime soon. And are they even supposed to achieve balance this year? Pat referred to achieving balance only on a monthly basis by year-end. But what does that actually mean?

The NHS remains deep in the financial mire. And after that doubling in budgets, the money's running out.

PS Doc Crippen draws my attention to the latest on the supercomputer. Not only is the thing way over budget and way behind schedule, but the private sector contractors are now imposing financial penalties on the NHS for wasting their time. Fujitsu has just "fined" the NHS Southern "cluster" £19m. Please tell me I'm dreaming this.

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