Published: 08/12/2005 Volume 115 No. 5985 Page 8

Trusts will be charged interest if they want to borrow money from other parts of the NHS, health secretary Patricia Hewitt revealed this week.

She told members of the Commons health select committee that the government was not 'planning for failure' and did not have a 'plan B' should trusts fail to turn round their finances.

'[Having a plan B] might well send the message to the leadership of these organisations that they can carry on in deficit and something else will come along and sort it out, ' she said.

She said that many of the biggest deficits were in the healthiest parts of the country, and in the past they had been bailed out by the poorer areas.

'What We have now done is to say if a trust or a whole health community is getting into deficit then they are responsible for that deficit, ' she told MPs. 'If they want to borrow money from a different part of the NHS then they will be charged interest on it, so we have an incentive in the system, coupled with the rest of the reform programme, to ensure that money is spent where it should be spent.' She suggested trusts slow down efforts on cutting waiting times if there is not the money in system to pay for it. If this was the case, they should not attempt to exceed the six-month target, due to be met in April, in a bid to get ahead on meeting the 18-week target in 2008.

Ms Hewitt said that primary care trusts should introduce minimum waits for trusts which are trying to exceed the six-month target. 'It would make sense to slow down, ' she said.

She told MPs she was confident of getting the net deficit of the NHS down to£250m by the end of the financial year and break even by 2006-07.

'If the government is not successful in this there will not be the money for future [cancer drug] Herceptins, ' she warned.