Stay with me for a paragraph or two. I want to answer the question; Is there more money in the NHS than we think?
If there is, we can ask a second question; Why are the Trusts under so much pressure?
Finance guru Roger Steer wrote an article for us. We published it earlier in the week. Today I'm using his stuff. Several thousand of you read it but I want to come at it again. It's important.
Roger starts by making the point that the NHS is no longer a unitary body. It's been broken up and he goes on to say there is no point in taking the temperature of one part of the NHS, we have to get the thermometer stuck into the lot.
Looking at NHS finances as a whole we have to learn two new phrases that will make you look soooo, knowledgeable at the next budget meeting but be careful how you use them at your next dinner-party, dahling!
Departmental expenditure limits, DEL - a posh way of saying the amount allocated to the DH by the Treasury.
Stay with me.... and...
Annually Managed Expenditure, AME - cash sloshing around to fix demand led stuff like litigation and legacy guarantees and what not.
Now, here's a really interesting little factoid that Roger gives us; both the DES and AME were underspent last year. Yes, I know I'm famous for my misspells and typos but underspent is what I really, really mean.
Read the headlines and you'd think that the Tinkerman was poking down the back of his Chesterfield looking for coins. Not a bit of it.
Read the accounts (no, I don't expect you to, Roger has done it for us) and you'll see the Trusts were predicting, for the 1st quarter of this financial year, to overspend by �800m.
You might remember Mickey&Grief, Monitor and the TDA, send Trust's budget plans back to do their homework again and be more realistic; hence the predicted overspend.
The 1st quarter results came in at about a �960m overspend. Only �160m more than the forecast. Agency staffing costs being the big ticket item, but not quite the unexpected drama we were led to believe.
Ok? With me so far.... park that and now let's think about commissioners, the CCGs. Last year they underspent. As did the DH. All the focus and talk about Trusts ignores other reserves and budgets; they are important because last year they enabled the DH to quietly bung the Trusts about �870m to keep them going, just in time for the election.
'There could be several reasons for... [Trust]... deficits but spending too much is only one. Not providing enough income to providers is more likely to be the case'.
Keeping them short, making them sweat. Is that a good idea?
Here comes the Sherlock bit. We know that, taking DH finances as a whole, the Tinkerman can cover his expenditure (let's not forget, about �9bn a year extra comes in from fees, education, training, private patient charges, land sales etc) so why does he foster the impression that the NHS is down to its last farthing?
As Roger Steer points out; 'Taken overall the DH shows good financial control and persistent underspends'.
Keeping the Trusts short of money is a policy choice and piles on extra pressure which exacerbates the problems of day-to-day running; special measures palaver, impact on quality and good people leaving their jobs.
You have to ask the question; are Trust finances being deliberately suppressed and if so, why?
Probably the greatest impediment faced by Trusts is the withdrawal of funding from social care, causing the passage of older patients through the system to grind to a halt.
For the patient, health and social care is a whole system. The sooner we treat it as a whole system, fund it and measure it as a whole system the better. Pillorying one part makes no sense.
Population based, capitated budgets with the ability to flex with demand makes more sense to me.
