Financial weak spots still plague NHS
pharmafile | October 25, 2007 | News story | |Â Â Â
The health service is no longer running at a deficit, but new figures show that one third of PCTs and trusts continue to struggle with their debts.
Thirty one per cent of NHS bodies have fallen short of the minimum financial requirements, according to the Audit Commission's Review of the NHS Financial Year 2006/07.
A number of trusts failed to meet standards on use of resource, partly attributed to mergers between some trusts in England last year, as bodies untouched by the reorganisation tended to perform better.
Steve Bundred, chief executive of the Audit Commission, said: "The NHS is no longer in deficit, which is good news for patients and for taxpayers. Managing money well goes hand in hand with providing better patient care."
But he added: "Trusts that fail to manage their money well are unlikely to be doing their best for patients. There is a worrying gap between the top performers and those still failing to meet their duty to balance their books. We are concerned about the variation of financial performance across the country.
"A number of NHS bodies are failing to manage their finances adequately and there appears little hope that they can get out of trouble by themselves."
The audit did show that 27% of trusts performed well or strongly against targets, an increase of 12% on last year. However, 8% failed on all three measures of financial management, financial standing, and value for money.
"The NHS needs to focus urgently on the management of this small group of NHS bodies that are failing across the board," Bundred added.
The overall financial position of the NHS recovered by over £1 billion, from a deficit of £547 million in 2005/06 to a year-end surplus of £515 million this year (excluding NHS foundation trusts).
NHS finances are expected to continue this improvement, and the Department of Health is forecasting an aggregate surplus of £983 million by the end of this financial year.
However, short-term costs for reorganisation have hit £192 million so far and the Audit Commission is keen for the NHS to translate this into savings for the medium to long term.
The patchy results match up to some extent with the finding of the Healthcare Commissions recent annual Health Check report, which raised concerns over hospital infections in some hospitals.
Responding to that report health secretary Alan Johnson warned the worst performing trusts in the NHS that they could face a takeover by better performing trusts if they fail to improve quickly.
