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NHS: Finance

Volume 457: debated on Wednesday 7 March 2007

To ask the Secretary of State for Health how many strategic health authority agreed recovery plans have been breached in the last two years. (121787)

Strategic health authorities (SHAs) agree financial recovery plans for the individual organisations within their patch. Financial recovery plans are not agreed for the SHA itself. However, SHAs have a net target to break-even across their patch each year. Their latest performance against that target was published on 20 February in our national health service finance report for quarter three of 2006-07. Copies of this report are available in the Library.

To ask the Secretary of State for Health what consideration is given to the internal budgetary conditions of primary care trusts when setting the (a) amount and (b) proportion of the trust's budget represented by the trust's contribution to London-wide NHS reserves; and if she will make a statement. (122416)

Returning the national health service to overall financial balance has been a key priority in 2006-07. Strategic health authorities (SHAs) have taken responsibility for developing and implementing financial and operational strategies to both manage and improve the financial position within their overall area. As part of this strategy, SHAs have top sliced resource allocations made to their primary care trusts (PCTs), thereby creating SHA reserves.

SHAs have agreed an appropriate level of contribution to these reserves with their PCTs thereby allowing the SHA to deliver the financial planning target for its economy. The level of any contributions is based on the financial and service circumstances of individual organisations, and is always underpinned by the principle of fairness.

We expect SHAs to maintain the integrity of the allocations system, with contributing PCTs being entitled to repayment of their contributions over a reasonable period, not usually exceeding the three-year allocation cycle. However, SHAs will be asked to ensure that PCTs with the greatest health need are repaid first.