A preliminary 'traffic light' system ranking English health authorities in terms of performance and effectiveness exposes a sharp North-South divide, with the vast majority of poor-performing 'red light' organisations in the North, this week's HSJ reveals.

A ranking system devised by John Appleby and Chris Deeming of the King's Fund puts Dorset at the top of the league tables, with Manchester at the bottom.

The 'traffic light' league tables, flagged up in the NHS plan, will rank NHS organisations as green, yellow or red, based on a host of performance criteria.

Mr Appleby and Mr Deeming have ranked HAs using a methodology suggested by the Department of Health, combining data on a range of performance indicators and clinical indicators.

The ranking for 2000 shows that 24 HAs, a quarter of the total, have a red light - over 80 per cent of them in the North, which suggests the tables are being influenced by demographic factors, beyond the weighted capitation formula.

Conversely, more than 70 per cent of 'green'HAs are in the South.

The authors believe that 'there is an argument for adjusting the ranking to reflect the relative difficulties HAs face', given that there generally has to be some degree of trade-off between different performance measures.

This is confirmed by the fact that no HA manages to achieve green-light status in all six areas of assessment: health improvement, fair access, effective delivery, efficiency, patient and carer experience, and health outcomes.

The King's Fund team also believes it is not appropriate to give equal weight to the different performance data. 'Some are clearly more important than others, 'Mr Appleby said.

But the team is concerned that it may be impossible to create a ranking system that will fairly reflect the work of NHS organisations - and that there is potential for organisations to manipulate the tables further down the track.

'Only time will reveal any potential perverse incentives and the extent of any 'gaming' within the traffic-light system.'

Mr Appleby believes that performance information needs to be made public, but that the DoH should take account of its context now it will be used. 'The information will be used and misused and misunderstood, but we still need to do it.'

He also queries the wisdom of linking performance to financial incentives and the 'arbitrary' decision to put 25 per cent of organisations in the red-light category.

'I don't think this system is the be-all and end-all of determining what is going on at local level, but we do need to combine as much information as possible about what's happening in the NHS, 'Mr Appleby said.

Another element of that is the Commission for Health Improvement's formal clinical governance reviews, the first of which will be published next week.

Pilot clinical governance reviews began in April at four trusts: Southampton University Hospitals trust, City Hospitals Sunderland, North West Wales trust (Bangor) and Chesterfield and North Derbyshire Royal Hospital.