The government must accept “radical changes” to hospital services if it diverts more NHS funding to shore up the social care budget, the head of the NHS England has said.

Sir David Nicholson’s warning shot comes as ministers prepare for this month’s comprehensive spending review, and consider how to fund for long-term social care.

Around £1bn NHS funds will be transferred to social care this year. Health minister Norman Lamb last month indicated he wanted clinical commissioning groups to significantly increase spend on social care, while shadow health secretary Andy Burnham last week said £1bn of the NHS “underspend” should be transferred.

Stressing that he was not referring to any specific proposal, Sir David said there would be “consequences” if a further £1bn of NHS funding ended up in the social care budget which those making the decision would have to “sign up to”.

Acknowledging the shift of funds may be in the interests of the public, he said: “My issue is that £1bn will have to come out of the existing hospitals services. There is nowhere else to take it from.”

He added: “There isn’t a spare billion hanging around in hospitals. So that means radical change in the way hospitals operate.  If people want to explain to me how the billion is going to be transferred, and how hospitals are going to have to be altered to make that happen and will sign up to the consequences, I’m all for it.  

Sir David also accepted there had been errors in commissioning allocations for 2013-14. He said: “We did the best job we could [with] the data we had. We knew this year would be difficult. Undoubtedly some of the money is in the wrong place. We’re confident there’s enough money in the system… but it’s going to take more time than people would like to [decide final allocations].”


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