Hospitals hide funds to rein in surplus

Hospitals and primary care trusts have prepaid suppliers many hundreds of millions of pounds and have hidden money in other ways in order to keep the National Health Service surplus for last year down to the forecast £1.8bn. Without such action, senior NHS managers say, the declared surplus for the NHS in England in the financial year just ended is likely to have been nearer £3bn.

That money is in addition to the £2bn of cash in the bank, much of it working capital, that foundation trusts are expected to hold as they generate their own surplus of perhaps £500m. The move appears to have two motives: first to avoid the political embarrassment of the massive swing to a huge surplus of about £3bn just two years after the NHS in England attracted months of dire headlines when it recorded a £571m deficit; and second, to reduce the risk that a cash-strapped Treasury will claw the money back.

What a way to run a health service! That much bemoaned deficit was totally insignificant, as I said at the time:

Only someone with no idea of what goes on in the real world would talk such crap. The overspend was about 0.7% of the total budget. Put another way. If you had an extension built and the estimate was for £15,000 I don't think you'd lose much sleep over getting an extra bill for £105, roughly the cost of replacing a broken sealed-unit. Meanwhile, as shown on a recent TV programme, a lack of foetal monitors has led directly to deaths and injuries during childbirth which cost the NHS £25 million in compensation last year alone.

So now there's a £3 billion surplus.

And I'm in my third week of waiting for a skin cancer biopsy. Jeez.