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BMJ. 2007 September 8; 335(7618): 468.
PMCID: PMC1971164

NHS likely to end financial year with £1bn surplus

Clinicians and patients are paying the price for a predicted surplus in the NHS, it has been claimed.

The Department of Health in its latest quarterly report says that the NHS in England will have achieved a surplus of almost £1bn (€1.5bn; $2bn) by the end of this financial year.

The department said that most NHS trusts would be in balance by April of next year, with an overall forecasted surplus of £983m. This compares with an end of year surplus of £510m in 2006-7 and a deficit of £547m in 2005-6.

A small number of trusts will finish the year with a deficit, however. Hinchingbrooke Health Care NHS Trust is expected to have the largest deficit, of £17.5m, 24% of turnover.

There has been a cost to achieving the healthy financial position, however, said Hamish Meldrum, chairman of the BMA, who paid tribute to the staff who had worked hard to reach this point.

“You have to look at what trusts have done to get out of the red,” he said. “At the end of last year we saw services to patients being cut, with operations delayed, outpatient clinics cancelled, and referral management schemes—which were really only thinly disguised forms of rationing.

“There are still hospitals that are threatening to lay off hundreds of staff in order to break even. Budgets that used to be set aside for the training of doctors and nurses have been raided.”

Dr Meldrum told the BMJ, “There has been an impact on doctors and patients. I wouldn't say doctors have been making sacrifices, but what has been happening has been affecting the way they can deliver best care to patients.

“There was poor financial management that allowed trusts to get into that state in the first place, but the timescale for which they were told they had to get out of it meant the measures they had to take were more extreme than we believed they needed to be, had they been given a longer timescale,” he added.

“We now want to work with government to ensure the money that now appears to be available is going back into the right areas and that these cuts are only temporary, as was suggested.”

Gill Morgan, chief executive of the NHS Confederation, which represents NHS organisations, said, “This is a credit to the hard work of NHS organisations up and down the country who have done an excellent job turning around the fortunes of many individual trusts in financial difficulty.

“£983m actually represents around 1% of the entire NHS budget. It is prudent to plan to deliver a small surplus as, if you don't have money in the bank, you won't have the flexibility to respond to emergencies, take on challenges such as the 18 week target, and develop new services.”

David Nicholson, chief executive of the NHS in England, said, “Local NHS staff have successfully turned the position around from one of overall deficit to a forecast surplus, created through increased efficiency and productivity and through greater financial discipline and rigour in the system.”

Notes

The quarterly report is available at www.dh.gov.uk.


Articles from The BMJ are provided here courtesy of BMJ Publishing Group