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Inflation And Spending

Volume 24: debated on Tuesday 25 May 1982

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asked the Secretary of State for Social Services whether he will ensure that, if inflation in the financial year 1982–83 should rise above the present estimate of 9 per cent. or if wage costs rise above 4 per cent., a spending increase of 2 per cent. in real terms is still achieved.

The public expenditure White Paper, Cmnd. 8494, plans provided for growth in the hospital and community health services of over 2 per cent. between estimated expenditure in 1981–82 and planned expenditure in 1982–83. Health authorities were required to provide about 0·2 per cent., or £17 million, of this growth by making better use of existing resources.Growth in services in 1982–83 will be affected by the extent to which health authorities succeed in making efficiency savings in excess of £17 million to meet their contribution towards the cost of pay offers in excess of 4 per cent. that have been made to certain groups of NHS staff, and by whether price inflation is above or below the cash limit provision of 10·3 per cent. for health authority goods and services.There is no reason at this stage to believe that an increase in services of 2 per cent. cannot be achieved.