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Department of Health

As I understand it, the calculation is made on an SHA basis. To achieve national balancing, a sum equivalent to the overspend is being held in reserve. The amount will differ in different regions. In south Yorkshire we are told it will be 2.5 per cent. I hope it is no more. When one looks at the communities for which our PCT provides services, and the high levels of health inequality, £7.5 million is no mean sum. Given that the sum going into reserve equates to this year’s overspend, even though we do not know what the overspend is and probably will not know until the middle or end of next month, is the same thing likely to happen again in 2006–07? Everyone talks about the fact that PCTs—and presumably hospital trusts—that have run up large overspends, perhaps over years or perhaps over the past 12 months, will not be able to pay off their overspends over the next 12 months. Even if they incur no more extra spending in the next financial year, we will be debating estimates this time next year and observing that, although the overspend is down, it has not gone away. What worries me, and probably worries my primary care trust, is that, if the same situation occurs next year, it will not be a case of keeping money in reserve to balance the books. It will bite into the growth money that has been so vital to turning health care around in my area.