Managers in Wales have expressed concern at calls by Welsh health minister Jane Hutt for further cash-releasing efficiency savings when the health service is suffering major financial pressures and 'unprecedented' demand.

The Welsh Assembly was due to meet this week to discuss details of a budget that would increase overall NHS spending in Wales by 7 per cent and increase health authority allocations by 6 per cent. All Welsh trusts face deficits next year totalling about£30m.

Speaking at the NHS Confederation in Wales' annual conference, Ms Hutt conceded that next year would be 'challenging', but said managers would need to deliver new policy initiatives aimed at social exclusion and deprivation while saving money.

Richard Thomas, director of the NHS Confederation in Wales, said the 'devil was in the detail' of the budget proposals, but his main concern was the 'reference to the need for further cash-releasing efficiency savings'.

Paul Williams, chair of the Institute of Healthcare Management in Wales, and chief executive of Bridgend and District trust, said a few factors, including pay rises, would eat up a 7 per cent increase.