GPs and NHS Employers have agreed a formula that could phase out the minimum practice income guarantee. The guarantee has been strongly criticised, as it means GP practices suffer no financial penalty if patients choose to go elsewhere.

It was introduced into GP contracts in 2004 to eliminate concerns that a new needs-based funding formula would result in dramatic funding changes, particularly in wealthy areas. But NHS Employers and GPs have agreed that future overall practice funding increases should be divided differently across four main elements. This will gradually reduce the significance of the guarantee in relation to other elements of funding.

NHS Employers is recommending that overall funding increases by 2 per cent in 2009-10. Income guarantee payments would increase by just 0.6 per cent while "global sum" payments, based on the needs formula, would increase by 2.1 per cent. Quality and outcomes framework payments and funding for "enhanced services" would each increase by 1.5 per cent.

The British Medical Association has argued total funding should increase by 4 per cent.