14 December 2007
The NHS must not become complacent about its finances, the National Audit Office has warned.
Publishing the NHS audited accounts for 2006/07 on December 11, auditor general Sir John Bourn said that although the NHS achieved a surplus last year, it was 'not a time to be complacent' and challenges remained.
'The national picture is one of financial balance, but there remains a relatively small core of NHS organisations that continue to report significant deficits. A failure to keep a tight grip on financial performance will undermine service quality, an area in which the NHS must not let patients down,' he warned.
The NAO figures show that the health service achieved an overall net surplus of £515m last year, compared with a net deficit of £547m in 2005/06.
However, for a 'small but significant number of primary care trusts and NHS trusts, restoring financial balance remains a significant challenge', the report said, with 82 NHS organisations reporting a gross deficit of £917m. The size of the deficits in the organisations with the poorest financial standing is increasing year on year.
Public Accounts Committee chair Edward Leigh said: 'The improvement does not in any way mean that the NHS has achieved long-term financial stability.
'One of the main reasons behind the surplus this year is simply that funds have been withheld from primary care trusts and left in the coffers of the strategic health authorities'.
Liberal Democrat health spokesman Norman Lamb added that a 'hard core' of NHS trusts were still in 'deep debt'. He said: 'NHS finances are held together by an intricate web of loans and top-slicing, which conceal the true extent of the problems.'
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