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NPfIT delays plunge NHS trusts into the red

Financial health prognosis 'poor'

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Delays in the implementation of the National Programme for IT (NPfIT) have helped plunge some NHS trusts into the red, the public accounts committee report has revealed.

The Financial Management in the NHS report says 14 trusts are still waiting for "contributions to costs incurred" as a result of delays to the programme from the Department of Health (DoH).

The trusts have not been named in the report.

The DoH reported to the committee that information on how much has been claimed by each trust is not available. This is because requests include a mixture of one off costs, ongoing costs, alternative interim solutions, and unspecified amounts.

Although the failure to pay the trusts has contributed to NHS trust deficit, there is no "single cause", the report says.

A number of NHS bodies reported that they experienced cost pressures arising from the need to meet performance targets and to implement national initiatives.

In particular, the Agenda for Change pay initiative, the consultant contract, and the new General Medical Services contract has caused the NHS to be stretched financially, the report says.

The cost of implementing Agenda for Change was £220m more than expected in 2005-06.

Edward Leigh, chair of the commitee, says: "NHS bodies running hefty deficits. And the cumulative deficit for all NHS trusts at the end of March 2006 had soared to over £1bn. On these measures, the prognosis for the financial health of the service is poor.

"The transparency of the NHS financial reporting regime must be improved further to prevent deficits being hidden and to make sure the regime is being applied consistently to all bodies.

"Without this kind of transparency, there can be no spur to improve the standard of financial management in all NHS bodies. There is no excuse for clinicians to distance themselves from money matters as if the quality of healthcare delivered by an organisation has nothing to do with whether it has to dig itself out of a deficit."

The NHS budget for 2004-05 was £69.7bn, rising to £76.4bn in 2005-06 and will be £92.6bn in 2007-08. The NHS reported an overall deficit of £251m (including foundation trusts) in 2004-05. In 2005-06, the overall deficit increased to £570m (£547m excluding foundation trusts).

There was an increase in both the number of NHS organisations - strategic health authorities, primary care trusts, NHS trusts and NHS foundation trusts - reporting a deficit (up from 168 to 190).

This article was originally published at Kablenet.

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