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Health Service Finance

Volume 172: debated on Thursday 17 May 1990

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To ask the Secretary of State for Wales what is the interest rate which will be used for capital provided for the National Health Service in Wales with the new captital accountancy system; and if he will estimate what will be the impact of these changes on each of the nine district health authorities in Wales in their first year of operation.

The interest rate to be used for the purpose of calculating capital charges has been set at the current Treasury discount rate of 6 per cent. It is intended that the effect of capital charges will be neutral in the first year of operation with each authority being funded precisely in line with the estimated capital charges it will meet in that year. In due course the receipts from capital charges will be passed on to authorities according to their share of revenue resources. However, before then, there will be a transitional period to enable authorities and hospitals to adjust to the effects of charges on the costs of providing services. Until capital charges (which will include an element of depreciation as well as interest) have been calculated, it is not possible to estimate the effects on individual authorities.

To ask the Secretary of State for Wales if he will publish a table in the Official Report showing for each of the nine district health authorities in Wales for 1989–90 and 1990–91 (a) the total revenue grant per head of population and (b) the cash increase over the previous baseline for their districts allocated per head of population.

District health authority

Revenue provision per capita of resident population

Increase in revenue provision per capita of resident population over previous financial year

1989–90 £

1990–91 £

1989–90 £

1990–91 £

South Glamorgan428·17468·4123·0326·12
West Glamorgan303·70328·6416·5018·49

Source: Initial revenue allocations to health authorities 1989–90 and 1990–91.

Note: The population figures used are based on latest available (1988) mid-year estimates of resident population of district health authorities. However, it should be noted that district health authorities are currently funded to serve catchment populations rather than resident populations and the provision to South Glamorgan health authority also reflects the revenue costs associated with the medical and dental teaching functions of that authority.

To ask the Secretary of State for Wales, if he will publish in the Official Report in tables for (a) the whole of Wales and (b) Gwynedd, showing for each year since and including 1979–80 (i) the average hospital cost per in-patient case, (ii) the average hospital cost per out-patient case and (iii) the average hospital cost per day case attendance, showing figures both in cash terms and adjusted by the HCHS pay and price index.

Patients using a bed1Out patientsDay cases
Cash £Adjusted £Cash £Adjusted £Cash £Adjusted £
1 In-patients and day cases.


1. These costs exclude general services (for example catering, laundry cleaning and administration).

2. The H & CHS pay and price index used to adjust 1987–88 cash figures to 1988–89 pay and price levels is produced by the Department of Health and reflects the impact of pay and price movements on the mix of pay and non-pay expenditure in English authorities. It may not therefore be wholly representative of the effects of pay and price movements on the mix of pay and non-pay expenditure in health authorities in Wales.