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Wednesday 26th October 2016

Pay reform cost underestimated

26th October 2006

27042006_empty_corridor.jpgThe real cost of pay reforms in the NHS were underestimated, its chief executive has admitted.

David Nicholson told MPs the government had miscalculated just how much its range of new policies, including the new NHS pay system, were going to cost the health service and admitted they could have done better. He said the costings had been inaccurate for a variety of reasons.

Although the NHS has suffered increasing financial problems over the last few years, he said NHS finances had become increasingly transparent. He also defended individual NHS organisations’ ability to balance their books.

He spoke out as he gave evidence to the House of Commons Committee of Public Accounts as part of its one-off inquiry into the National Audit Office and Audit Commission report Financial Management in the NHS.

The report outlined concern about the financial management at more than a quarter of NHS trusts, but although Mr Nicholson agreed there was some poor management and some areas in need of improvement, he was confident most trusts had the capabilities to manage their budget.

MPs also sought assurances that vital NHS services would be maintained despite redundancies and ward closures being forced by trust the half-a-billion deficit. He was also quizzed on the job shortages for medical and healthcare graduates that are expected to create a surplus of staff over the next few years.

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