'Boom and bust' NHS heading for record surplus

NHS set for record underspend after budget cuts
NHS set for record underspend after budget cuts

The Department of Health (DoH) has been accused of boom and bust economics after it emerged the NHS is heading for a record surplus.

The health service is forecast to record a surplus of £1.8 billion in 2007-08.

This is more than triple the £547 million deficit incurred in 2005-06, which prompted a slew of budget cuts in a bid to balance the books.

It continues the trend for under-spending in the health service, further exceeding last year's surplus of £510 million.


Patient groups and opposition politicians have questioned why the NHS has built up a surplus at the same time as refusing drugs and services on the grounds of expense.

Ministers insist any surplus funds will be reinvested in patient care next year.

Shadow health secretary Andrew Lansley said: "The government's approach to the NHS has been one of boom and bust. They lost financial control and spent two years clawing back on NHS budgets."

Mr Lansley said holding large surplus at the centre was undermining health service planning across the country and making the NHS less efficient.

Liberal Democrat health spokesman Norman Lamb said "wild fluctuations" between deficits and surpluses were symptoms of a "vastly over-centralised system".

He said the NHS finances veered from feast to famine and showed the "economics of the madhouse".

Mr Lamb continued: "Do ministers not realize the negative impact this has on staff and patients? Any attempt at long-term planning of services is rendered meaningless."

The Lib Dem health spokesman already announced today he would be writing to Alan Johnson after paramedics in Norwich were forced to treat patients in a car park.

Norfolk and Norwich University Hospital was left with no beds after it went on "black alert" last night, forcing ambulances to queue up outside.

Non-urgent patients had to be discharged from the 1,000 bed facility to free up space.

Mr Lamb said: "It is crazy that the primary care trust is planning to close the nearby Aylsham community hospital when the Norfolk & Norwich Hospital is suffering a massive problem with delayed discharge meaning that dozens of beds every week are blocked."

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