Thursday, December 17, 1998 Published at 17:36 GMT
NHS told to tighten its belt
Hospitals will have to make efficiency savings
The government has set a series of long-term performance targets for the health service.
Chief Secretary to the Treasury Stephen Byers launched the initiative in a White Paper on Thursday.
Ministers are determined that the NHS should meet the new targets in return for the £21bn cash injection promised by Chancellor Gordon Brown in the Comprehensive Spending Review this summer.
The targets are laid down in a Public Service Agreement (PSA), one of 28 covering departments across government.
Most controversially, health authority bosses will be expected to make efficiency gains of three per cent a year for the next three years.
They have also been told to cut sickness absence, and fraud.
Other specific targets include:
The broad objectives of the NHS are defined in the PSA as:
In total, Mr Byers has laid down more than 500 targets to be met by Whitehall departments.
The aim is to increase the efficiency of public services, so that more than £8bn a year is released for re-investment by the year 2001-02.
"The old days of throwing money at a problem and hoping that it goes away have gone.
"Our approach is to ensure that the extra investment we are putting into public services achieves real improvements, that standards will be raised and the quality of services enhanced."
The government's insistence on 3% a year efficiency savings was criticised by the Institute of Health Services Management.
Deputy director Suzanne Tyler said: "Finding savings of £1bn year on year from April 1999 will place unprecedented pressure on a health service that is having to maximise existing resources to implement the government's avalanche of initiatives.
"Staff time is already at a premium because of existing restrictions on our management costs. A good quality health service needs a well resourced professional approach and effective management.
"It is important that performance targets are made, as simply throwing money at the likes of waiting lists will not work. But the targets must not only be measurable but also realistic."
The ability of departments to meet their spending plans will be reviewed by the Cabinet's public expenditure committee, chaired by the Chancellor.
The next Comprehensive Spending Review in 2001 will take account of how successful departments have been in keeping to their targets.