The health service should be alert to the “real risk” that spending areas outside of health will “leak” into the NHS’s budget responsibilities, the NHS Confederation has warned.
Last week’s Conservative-Liberal Democrat coalition agreement said NHS funding “should increase in real terms in each year of the parliament, while recognising the impact this decision would have on other departments”.
Confederation policy director Nigel Edwards told HSJ the reference to the impact on other departments was crucial and should be taken as a warning there was “potential for leakage into the NHS budget”.
Areas that could be reclassified as NHS spending include early years spending from the education budget and local authority spending that might be reclassified as “public health” or “prevention”.
Mr Edwards said some reclassification could be helpful, if it promoted more effective investment, but he warned: “People shouldn’t make assumptions there isn’t going to be a very radical change.”
Last week HSJ reported NHS managers were concerned the 2 per cent of 2010-11 primary care trust allocations they were told to set aside for “non-recurrent” spending were now vulnerable to an in-year claw back by the new government as they had not been allocated to “front line spending” and therefore not qualify for protection.
Mr Edwards agreed that was a “risk”, particularly as the chancellor George Osborne confirmed this week the government would make an additional £6bn of spending cuts this financial year.
Mr Osborne said on Monday details of the “immediate” spending reduction would be set out on May 24. He said the Department of Health would be asked to make a contribution to the £6bn but that would be “reinvested” into the NHS “front line”. Mr Osborne also singled out “quangos” as a target for “significant reductions”.
He confirmed an “emergency Budget” would be set out on 22 June and a longer term spending review would take place in the autumn.