There could be a £13bn gap between what the NHS has been assessed as needing and what it will get by 2013, the executive chair of the foundation trust regulator Monitor has warned.

Speaking at the Healthcare Financial Management Association conference last week Bill Moyes compared the 1.1 per cent funding growth expected from 2011 onwards with the required growth rates set out by Sir Derek Wanless in his 2002 review of healthcare finance for Gordon Brown, who was then chancellor.

The difference would equate to a£13bn gap by 2013, he said.

"That's an awfully big gap between what people think is going to be needed and what it appears [the NHS] will get in practice," he warned delegates.

That gap would only be filled by increased productivity, Mr Moyes said, but the health service was struggling to achieve 0.9 per cent productivity improvement under its current level of funding and would need to increase this by 2.5 percentage points to close it.

NHS constitution

Making cuts by extending waiting times would no longer be possible as shorter waits were about to be enshrined in law through the NHS constitution, he said.

Cuts in quality would not make economic sense either, he added, as longer bed days were more expensive and patients would choose to go elsewhere.

But there was good news for high performing trusts, as Audit Commission chair Michael O'Higgins said that those scoring three or four in one of the annual auditors' local evaluation's five themes next year would not be assessed on that theme the following year, provided there were no signs that performance had deteriorated.

Mr O'Higgins warned that health service organisations needed to get a tight grip on the implications of the recession. He predicted negative inflation in the coming months and said they needed to think about how they could take advantage of that but also how they would ensure their most important suppliers were stable.

HSJ's Business Leaders forum is on 20 January in Surrey, www.hsj-businessleaders.com

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