NHS cash fears 'may not hit care'

NHS funds have been rising by over 7% a year since 2002, but that stops in 2008 and is likely to drop to about 3.5%.

Health staff have long expressed fears services could be harmed, but the King's Fund think-tank said good planning could help to avoid problems.

The government said the health service would rise to the challenge of providing better care.

"But I think things will get tight and we will have to make some tough decisions about what the NHS can and cannot do"
Jonathan Fielden, of the British Medical Association

The King's Fund said it was important to remember the NHS budget would still be rising - albeit not as quickly as it is now.

Researchers said if the health service was to thrive deficits needed to be resolved, doctors engaged with and variations in performance eradicated.

The think-tank said there were unexplained differences in hospital referral rates, treatment criteria and levels of prescribing which could hold the key to improving performance.

King's Fund chief executive Niall Dickson said: "Everyone knows the days of massive growth in health spending will come to an end from 2008.

"That is bound to be difficult but it should not be a cause for despair.

"The message is clear - once the service is placed on a sound financial footing, the focus must be on improving productivity, tackling variations in performance and setting the right incentives."

Latest figures show that many hospitals and primary care trusts are racking up debts this year, forcing them to impose recruitment freezes and delay operations.

Debts

But the Department of Health has pointed out the NHS is still likely to balance its books this year, meaning it will not have to dip into funds in future years to pay off debts as it has been doing recently.

Chancellor Gordon Brown is due to announce how much the NHS will receive from 2008 to 2012 in the summer, but most experts are predicting something between 3% and 4%.

Health Minister Andy Burnham said: "I'm pleased that the King's Fund recognises that the NHS can rise to the challenge of delivering high quality patient care, whatever the spending settlement.

"Our reform programme is designed to further transform the NHS into a world-class service."

However, doctors believe the next few years could be uncomfortable.

Jonathan Fielden, chairman of the British Medical Association's consultants committee, said: "Yes, the NHS has to adapt. But I think things will get tight and we will have to make some tough decisions about what the NHS can and cannot do."

Shadow health secretary Andrew Lansley welcomed the report's backing for measuring outcomes and engagement with professionals.

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