Published:25/04/2002, Volume II2, No. 5802, Page 5

Clinical negligence claims against the NHS are set to increase yet again, the National Audit Office warns in its annual report to parliament on the NHS accounts.

The money set aside for the likely cost of claims at March 2001 -£3.9bn - represents a near-doubling on the 1998 figure of£2.3bn.

But although the total provision has continued to grow, the rate of increase has steadily decreased.

The provision was£500m more than the previous year.

The increase comes despite changes in the way the NHS handles complaints, which it was hoped would reduce the proportion of negligence claims which went to a lengthy - and expensive - court battle.

One of the reasons for the increase are two legal cases - We l l s v Wells and Heil v Rankin. They set a precedent for higher payments which include meeting the costs of future education, care and loss of earnings. The eventual bill could be even more than the£3.9bn set aside. The NHS has to make provision for cases which may, but are unlikely to, lead to claims. This represents a further£4bn on top of the existing provision.

The report from NAO auditor general Sir John Bourne paints a reasonably healthy picture of the NHS. All but one primary care trust and health authority fell within their statutory duty of financial balance. Bexley and Greenwich HA, however, had a 'small' overspend of£900,000 (0.3 per cent of its expenditure limit) but this was in a period in the lead up to a merger with a neighbouring HA.

Of the 356 trusts, none failed to meet their statutory duty to break even, although 47 had cumulative deficits since April 1997 in excess of 0.5 per cent of income. The DoH allows a cumulative deficit of no more than 0.5 per cent of turnover, and that deficit has to be recovered within two years.

It also reports that the NHS recovered more than£4m and achieved 30 successful fraud prosecutions in 2000-01.

NHS (England) Summarised Accounts 2000-01 .

HC 766 www. nao. gov. uk