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Budget 2011 - reaction and briefing for members
Briefing for members
Our briefing sets out the main points in the budget for the NHS, including:
- The Office for Budget Responsibility has revised the GDP deflator (the measure of inflation used for public services' budgets) for 2011/12 upwards from 1.9% forecast in June 2010 to 2.9%.
- Personal social services resource grants form part of the local government budget from 2011/12 onwards.
- Under inherited plans for 2011/12, the main and additional rates of National Insurance Contributions will increase by 1%, although the effect of this on employers is largely reversed because the secondary threshold for employer contributions will increase to £136 per week.
- The Government will also take forward a range of measures to encourage innovation in NHS Procurement.
Read the full briefing for more detail.
NHS Confederation reaction
Acting chief executive Nigel Edwards said: “The figures in today’s budget reinforce what NHS leaders have known for some time, that while the NHS has done relatively well when compared to other parts of the public sector this is a difficult financial settlement and will cause real pain.
Reduced expenditure and rising demand
“The NHS is facing the need to find £15-20bn of efficiency savings over the next five years due to a combination of reduced expenditure and rising demand. It will have to make these savings while dealing with the impact of cuts to local authority budgets, which are likely to squeeze the provision of social care for vulnerable people and place pressure on the health service which will have to meet their needs.
Financial pressure one of top challenges
“The Confederation’s own survey of healthcare leaders found that 63 per cent of them listed financial pressures as one of the top three challenges they are faced with in the coming year. And work by the Foundation Trust Network found that on average NHS providers are looking for a minimum of six per cent efficiency savings across the board.
Hard decisions
“There will be some hard decisions to be made about staffing levels, service reconfigurations and investment priorities if we are to prevent a financial crisis in the NHS and continue providing high-quality care.“
Contacts
Kate Ravenscroft
Kate.Ravenscroft@nhsconfed.org
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