Page last updated at 00:09 GMT, Monday, 17 May 2010 01:09 UK

Fears jobs may go as NHS sets aside 2bn 'change' fund

By Nick Triggle
Health reporter, BBC News

Nurses
The NHS has been told to make savings

The NHS is bracing itself for a "brutal" round of cuts - and staff fear they are in the firing line.

Several major hospitals have already said posts will go and more announcements are expected soon.

The BBC has learned a £2bn pot is being set aside in England to pay for one-off costs, such as redundancies and redeployments, to help fund the cuts.

Managers were told by the Department of Health before the election to hold the money back.

Staff working in hospitals are particularly vulnerable because much of their budget - two-thirds in some cases - is accounted for by labour costs.

While many trusts are thought to have been waiting until after the election to make announcements, some have already been made public.

Southampton Hospitals Trust is shedding 400 posts this year and 200 next.

And in a briefing to staff, seen by the BBC, bosses warned there could be similar levels of cuts from the 8,000-strong workforce in years to come.

I think it is pretty clear headcount will drop. The NHS is facing a pretty brutal time
Michael Sobanja, of the NHS Alliance

Meanwhile, Cambridge University Hospitals Trust, which includes Addenbrooke's, and Liverpool's Alder Hey Hospital have both asked staff who want to leave to put themselves forward for a pay-off.

In his first interview after being appointed health secretary, Andrew Lansley told the BBC last week the coalition government wanted to see efficiency savings, but claimed this did not necessarily equate to cuts.

But the existence of the £2bn fund in England has prompted speculation that staff are set to face the brunt of the measures.

NHS managers are normally expected to hold some money back, to help balance the books in case of overspends or to pay for any unexpected emergencies, such as the flu pandemic.

This is still happening this financial year - about £1bn has been set aside - but the second pot is a break from traditional practice.

'Inevitable'

Dr Paul Flynn, deputy chairman of the British Medical Association, said: "I would hope redundancy is not the first thing this fund is going to be used for, but it seems job losses will be inevitable.

"We hear about the drugs budget and other areas where savings can be made, but staff costs are the biggest single cost the NHS faces.

"Health is an emotional issue and during the election the parties did everything they could to avoid saying anything to indicate they will hit the NHS. But it is naive to think there won't be some effect."

Michael Sobanja, of the NHS Alliance, which represents staff working outside hospitals, agreed.

"I think it is pretty clear headcount will drop. The NHS is facing a pretty brutal time."

John Lister, of Health Emergency, a union-funded pressure group, added: "It is unavoidable staff will be hit and, in turn, patients. We are braced for a series of cuts, which will be the worst for many years."

But David Stout, of the Primary Care Trust Network, which represents managers, said: "Redundancy is a legitimate use of this money, but it is also about paying for redeploying staff, retraining them and setting up new services. It is a change fund and is being seen as a perfectly sensible move."

Health Secretary Andrew Lansley said: "Efficiency savings are being made in order to improve NHS care. I have been clear that this money will be reinvested into NHS services".



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SEE ALSO
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Tories rule out forced closures
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Labour pledge on NHS reforms
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Lib Dem plan to cut NHS red tape
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Hospitals 'to feel funding pinch'
10 Dec 09 |  Health
NHS finances 'must not be raided'
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