NHS finance chief to tackle cost pressures

27 Sep 01
The NHS director of finance has acknowledged the rising cost pressures faced by the health service and promised to take these into account when allocating funding for next year.

28 September 2001

There is growing concern among finance staff that extra cash pumped into the service to aid the government's NHS Plan modernisation programme is being used to prop up basic services and cover increases in the costs of staff and prescribing.

Richard Douglas told the CIPFA annual health conference in Brighton this week: 'We all have concerns about this but we are doing something really difficult. We are managing the system and reforming it at the same time. It was never going to be easy.

'I don't believe all the money is going on papering over the cracks, though I think there is probably more of this than we might have anticipated. However, we are in the first year of a ten-year reform programme and it is not just about money but also about supporting people to deliver changes.'

Douglas accepted that many NHS organisations were feeling the pinch, despite an average funding increase of almost 9% in cash terms. Allocations for 2002/03 and next year's Spending Review, covering 2003/04 to 2005/06, would focus primarily on the NHS Plan but also take account of cost pressures.

'It will be a fair and rigorous assessment of what is needed to deliver the Plan but it is not being done in isolation by accountants and economists in the department.

'We are drawing on experts from across the system and are looking at what's happening with baseline pressures, including pay, activity, prices and prescribing. This will be built into our analysis.'

But he warned that the service had to deliver real improvements for patients and staff over the next three years.

'We must show we have not just met the targets but delivered real change. Although we have some difficult financial issues, we have to recognise that we have received, and will continue to receive, significant increases in resources,' he said. 'If we can't deliver then people will rightly question whether we ever can. I believe passionately that we can and will.'


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