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Last Updated: Thursday, 3 March, 2005, 11:02 GMT
340m deficit predicted for NHS
Some trusts have cut back on theatre lists to save money
The NHS in England could emerge with a deficit of more than 340 million at the end of this financial year, a report has suggested.

A survey of the 28 strategic health authorities (SHAs) by the Health Service Journal revealed the forecast.

It is over 100 million more than the NHS was predicting in January.

But health ministers said past experience had shown that the position would improve by the end of the financial year.

The problem is one of ambition running ahead of spending plans
Nigel Edwards, NHS Confederation
However, the HSJ said the level of current deficit had risen from 500 million in January to 554 million, indicating the current position of acute and primary care trusts had worsened substantially in that period.

The journal said it demonstrated "the extent of the financial troubles dogging the NHS".

North West London SHA reported the highest deficit - currently 49.5 million, and a predicted end-of-year figure of 47.5 million.

SHAs have introduced various measures in an attempt to cut deficits, including cutting back on services, closing beds and theatre lists and freezing recruitment.

'Not unusual'

The HSJ said that, while many trusts would find ways of reducing their debt, there could be problems in the future if trusts did not solve their financial problems this year.

Nigel Edwards, policy director at the NHS Confederation, told the magazine that achieving financial balance would prove "very, very difficult next year" and subsequently.

"Some large acute trusts have already taken drastic action shutting wards and laying off staff and others are likely to follow suit next year.

"The problem is one of ambition running ahead of spending plans. We need a prioritisation of what we really want to do in the NHS."

But Health Minister John Hutton said: "It is not unusual for the NHS to be reporting deficits at this time in the financial year.

"Past experience has shown that the overall position has improved by year end and the NHS has achieved overall financial balance for the last four successive financial years."

He added: "Since 2002-03, expenditure on the NHS in England has increased 7.4% a year over and above inflation and we recently announced a further 135 billion for primary care trusts covering the next two financial years.

"This is the longest and most sustained period of investment in the history of the NHS."


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