Published: 30/09/2004, Volume II4, No. 5925 Page 3

GP practices will be allowed to keep half of any savings they make when practice-led commissioning is universally introduced to the NHS next April, HSJ has discovered. But primary care trusts will remain responsible for any overspend.

A senior government source has told HSJ that guidance due from the Department of Health in the next few weeks will confirm that all practices will have the right to manage their own budget from April. The DoH will also put in place a number of safeguards to ensure the success of a policy which, according to the source, could see a large part of PCTs' commissioning role migrate to practices over the next three years.

Only specialist commissioning is to be excluded from the move.

The guidance includes a number of incentives to encourage as many practices as possible to take on budget responsibility. As well as not having to run the risk of over-spending and benefiting directly from any saving, practices will not have to take on the whole budget to begin with, but could gradually increase the proportion over time. There will even be help in calculating practice budgets, with the DoH making specially developed software freely available to practices.

HSJ's government source made it clear that PCTs will have to have very good reasons to refuse the transfer of budget control to practices. An appeals procedure against any refusal is to be established and strategic health authorities will closely performance manage the transition.

One source close to the development of the guidance said: 'Some PCTs will be very surprised by how seriously this is being taken.'

As well as monitoring the risk of any overspend, PCTs will also be charged with ensuring that practices do not cherry pick parts of the budget associated with the least difficult elements of their workload.

The guidance - described by the government source as very permissive - contains a number of best-practice examples where practice-led commissioning is already operating.

One source close to the guidance said North Bradford PCT's use of incentives and information to develop a sophisticated practicelevel commissioning system had been particularly influential.

National Association of Primary Care chair Dr Peter Smith, who has long argued for practice-led commissioning, described the guidance as 'wonderful.'

He said it recognised that by 2008, with patients choosing providers at the point of referral, and payment by results meaning that those choices had direct financial implication, effective commissioning would only be possible at practice level.

He anticipated PCTs continuing to have a strategic overview of commissioning, but claimed: 'Within three years I expect practice-level commissioning to be almost universal.'

National Primary and Care Trust Development Programme lead and Bradford South and West PCT chief executive Dr Barbara Hakin said the guidance was another 'excellent' sign of devolution to the front line.

However, she cautioned that many GP practices did not fully understand the implications that choice and payment by results would have on commissioning in directly linking treatment with payment. She feared that many would still believe that, as with fundholding, practice-led commissioning involved negotiating on price and volume.

Dr Hakin also said effective practice-led commissioning would require a significant improvement in 'internal information flows' on patients and their treatment throughout primary care.