National NHS surplus rises by £329m

Unpublished Department of Health figures, leaked to HSJ, show that at the end of the third quarter of 2011-12 primary care trusts and strategic health authorities were forecasting they would reach year-end with a surplus £329m more than predicted at the start of 2011-12.

Meanwhile, the NHS trust sector is forecasting a surplus of £26m - £31m less than originally planned.

SHA clusters said the money would be put back into local health economies and the development of clinical commissioning groups in 2012-13.

However, Foundation Trust Network director Sue Slipman told HSJ the money should have been available to spend on frontline services during 2011-12, particularly on taking demand out of the acute sector.

Ms Slipman said it showed there was more money in the system than people were being led to believe. “Our members are being penalised yet there is no pressure on commissioners to invest in alternative services,” she said.

The rise represents an increase in the surplus as a proportion of total NHS budget from 1.2 per cent to 1.6 per cent.

The North West and the South West are forecasting end-of-year surpluses of £533m and £376m respectively, equivalent to more than 2 per cent of turnover.

A spokeswoman for NHS South West, which had the biggest increase in its surplus in both cash and percentage terms, said the £75m increase reflected an “in-year review and reduction of contingencies and a risk-assessed review of 2011-12 transition costs”.

NHS Midlands and East SHA cluster attributed a surplus 22 per cent ahead of plan to productivity savings and the delayed abolition of SHAs which saved on redundancy.

King’s Fund chief economist John Appleby told HSJ that insufficient detail was available to judge whether the savings came from genuine productivity gains or just putting pressure on the acute sector through reductions in tariff prices.

“You can’t simply topslice money and call it an efficiency gain,” he said.

Figures from NHS London at the end of month 10 show its forecast surplus has risen to £282m. A spokesman said the improvement in position included a £15.6m improvement from London’s trusts, notably Imperial College Healthcare Trust, and £8.3m from PCTs.

The DH declined to comment on the figures ahead of publication.