NHS Trust Deficits

Oral Answers to Questions — Health – in the House of Commons at 11:30 am on 18 January 2005.

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Photo of Mr Archie Norman Mr Archie Norman Conservative, Tunbridge Wells 11:30, 18 January 2005

What steps he is taking to address financial deficits in NHS trusts.

Photo of John Hutton John Hutton Minister of State, Department of Health, Minister of State (Department of Health) (Health)

Strategic health authorities have responsibility for managing the financial performance of NHS trusts in their area. Additional financial support is provided, where necessary, to NHS trusts and primary care trusts through the NHS bank, strategic health authorities and, in exceptional circumstances, the Department of Health.

Photo of Mr Archie Norman Mr Archie Norman Conservative, Tunbridge Wells

Is the Minister aware of the claim in the Health Service Journal that the NHS is deep in the red to the tune of £500 million, and that the usual claim that this will sort itself out by the end of the financial year will no longer wash? Will he acknowledge that, this year, a large proportion of the deficits have been caused by unbudgeted cost overruns on centrally driven initiatives such as the new consultants' contract—which could cost an extra £200 million—the GP contract and the working time directive? Does he also recognise that the British Medical Association is saying that 25 per cent. of NHS trusts have already frozen vacant positions? Does he acknowledge that, this year, there is a real case for funding those deficits directly, where merit-worthy cases can be presented to demonstrate that the fault lies with central Government rather than with faulty planning or budgeting by the trust?

Photo of John Hutton John Hutton Minister of State, Department of Health, Minister of State (Department of Health) (Health)

I am certainly aware of the Health Service Journal's predictions about the financial state of the national health service this year. I know that the hon. Gentleman is a strong supporter of the NHS, and I appreciate that. I would like to remind him that the Health Service Journal, Conservative Front Benchers and Liberal Democrat Front Benchers have made predictions about deficits every year, but none has ever proved to be accurate or well founded. Last year, the Lib Dems predicted a £400 million deficit; we actually had a £73 million surplus.

Photo of Steve McCabe Steve McCabe PPS (Rt Hon Charles Clarke, Secretary of State), Home Office

Is it possible to track and address deficits in an NHS devoid of accountants, administrators and strategic health authorities? If not, would it be fair to dismiss these dedicated civil servants as pointless and unnecessary bureaucrats at the stroke of a pen, or would that be to perpetrate a deliberate falsehood on the British public?

Photo of John Hutton John Hutton Minister of State, Department of Health, Minister of State (Department of Health) (Health)

I strongly agree with my hon. Friend. When we look at the proposals that are eventually emerging from those on the Conservative Front Bench, we see how utterly threadbare, incredible and ludicrous their arithmetic is. The NHS needs good management; it does not need slash and burn, which is what the Tories are proposing.

Photo of Patrick McLoughlin Patrick McLoughlin Opposition Deputy Chief Whip (Commons)

Will the Minister tell me whether NHS deficits have anything to do with the fact that Ebixa, a drug used to treat Alzheimer's disease, is available in Ashfield but not in Ashbourne?

Photo of John Hutton John Hutton Minister of State, Department of Health, Minister of State (Department of Health) (Health)

I accept that there are issues there, and it is perfectly fair of the hon. Gentleman to raise them, although we have taken concrete, specific and successful measures to deal with the lottery of care that we inherited in 1997. We shall need to wait and see what the true position on NHS deficits is at the year end, but it will bear no resemblance to the figures that Mr. Norman has just quoted.