Published: 04/04/2002, Volume II2, No. 5799 Page 4

Staff pay has soaked up£1.9bn of the extra funding being made available to the NHS, according to an interim report presented to the NHS modernisation board.

Even though spending increased by£4bn in the last financial year and is rising by£5bn this year, latest figures reveal that last year fewer waiting-list cases were being treated - as either inpatients or day cases.

The report to the NHS modernisation board by the NHS's director of finance, Richard Douglas, also reveals the cost of hiring new doctors, nurses and therapists rose by£550m, and£1bn extra was spent on drugs - a 12 per cent hike in one year.

The rest was spent on new buildings, capital equipment and on settling negligence claims - which were up by£150m to£450m.