asked the Secretary of State for Social Services if he will make a statement on the detailed terms of the new contract between his Department and the Pharmaceutical Service Negotiating Committee; what are the various cut-off points in terms of numbers of prescriptions issued which will be used to determine pharmacists' remuneration; upon what criteria the cut-off points were determined; and what assessment he has made of the effects of the new contract upon the level of remuneration of pharmacists within each band.

Chemists remuneration: structure of fees
Option 12: graduated dispensing fee of:—
		120	51	62
	change points:—	15900	27000
		(1325 pa)	(2250 pa)

Plus 52 fiat rate oncost
Prescription Numbers (Annual)	Estabs. in band	Mid point of band (RX/month)	Monthly receipts under 85/86 fee structure		Monthly receipts under new option		Monthly difference
			Pounds/pharm.	Pence/RX	Pounds	Pence/RX	Pounds/pharm.	Pence/RX
0–2399	24	100	394·47	394·47	142·44	142·44	-252·03	-252·03
2400–3599	35	250	611·18	244·47	356·10	142·44	-255·08	-102·03
3600–4799	50	350	755·65	215·90	498·54	142·44	-257·11	-73·46
4800–5999	48	450	898·45	199·66	640·98	142·44	-257·47	-57·22
6000–7199	59	550	1026·16	186·57	783·42	142·44	-242·74	-44·13
7200–8399	79	650	1152·76	177·35	925·86	142·44	-226·90	-34·91
8400–9599	129	750	1280·47	170·73	1068·30	142·44	-212·17	-28·29
9600–10799	125	850	1405·21	165·32	1210·74	142·44	-194·47	-22·88
10800–11999	164	950	1519·89	159·89	1353·18	142·44	-166·71	-17·55
12000–12199	226	1050	1622·28	154·50	1495·62	142·44	-126·66	-12·06
13200–14399	204	1150	1718·71	149·45	1638·06	142·44	-88·65	-7·01
14400–14999	118	1225	1796·25	146·63	1744·89	142·44	-51·36	-4·19
15000–15899	121	1288	1856·58	144·14	1834·63	142·44	-21·95	-1·70
15900–16799	236	1363	1909·53	140·10	1915·24	140·52	5·71	0·42
16800–19799	723	1525	2032·94	133·31	2034·21	133·39	1·27	0·08
19800–22799	743	1775	2219·47	125·04	2217·81	124·95	-1·66	-0·09
22800–26999	1035	2075	2405·52	115·93	2438·13	117·50	32·61	1·57
27000–29999	710	2375	2672·94	112·54	2672·20	112·51	-0·74	-0·03
30000–33599	710	2650	2894·28	109·22	2904·41	109·60	10·13	0·38
33600–37199	662	2950	3138·70	106·40	3157·73	107·04	19·03	0·65
37200–40799	608	3250	3396·13	104·50	3411·05	104·96	14·92	0·46
40000–44399	456	3550	3660·13	103·10	3664·37	103·22	4·24	0·12

The new contract is a lengthy document containing much detail. The full text was placed in the Library on 17 June. The main features are:

A system of annual negotiations and annual cost inquiries to a fixed timetable and a fixed settlement date of 1 April each year. This will prevent as far as practicable the accrual of large sums of arrears, and the need for massive retrospective adjustment. This will reduce the number of disputes between Government and profession that the old arrangements had an in-built tendency to cause.

A system to ensure that the National Health Service obtains and pays for only those pharmaceutical services which the NHS and its patients need. Family Practitioner Committees will decide whether the needs of patients justify the expenditure on a new NHS contract, and will refuse an application if this is not the case. The only judgment will be one of patient need. This arrangement will ensure that there is a reasonable but not excessive supply of pharmacies with NHS contracts.

An increased level of financial support by means of minimum income guarantee to essential small pharmacies to ensure continuing access to NHS services in thinly populated, mainly rural areas.

Greater encouragement to cost effective and efficient practice through changes in the remuneration structure.

For two years, a system of payments to small pharmacies which wish to relinquish the NHS contract, helping pharmacists who find themselves locked into unattractive contracts to withdraw.

A modified system of cost collection which will produce some savings which will be shared equally between Government and the profession, producing some funds to help implement development in the pharmacist's role.

A sound basis for developing that future role following discussion of the recommendations of the Nuffield inquiry.

All the details, including the cut-off points to be used in determining remuneration, emerged from a long period of negotiation with the committee which represents all contractors. The effect of the proposals on average remuneration within various bands is set out in the table.