News / 5% of health budget still to be confirmed

NHS chief executive David Nicholson welcomed the ‘decent’ deal for the NHS in the pre-Budget report but warned NHS managers that 5% still needed to be settled.

As expected, the pre-Budget report confirmed average PCT growth for next year of 5.5%. But it said NHS frontline services could expect spending to rise in line with inflation (flat real terms growth) in 2011/12 and 2012/13.

In total this protection extends to 95% of spending – including the 85% of spending in PCT allocations plus key central budgets, including training and education, dentistry and pharmacy. Mr Nicholson said this left 5%, or more than £5bn, that ‘we need to watch’.

Department of Health director general of finance David Flory warned that there were lines within the £5bn where there could be pressure for growth.

And he said the inflation assumption underpinning the ‘real terms’ flat settlement would be crucial. ‘It will be important to get into the detail of the inflation calculation,’ he said, but added that in overall terms the NHS was in a ‘strong place’.