04.05.11
Savings warning from Monitor
High inflation and other economic factors mean NHS trusts may have to make average annual savings half as big again as the current £20bn cuts exercise.
Monitor, which oversees NHS foundation trusts, has written to trust chief executives to warn that annual average savings of 6% or 7% may be needed, compared to the 4% called for at the moment.
A spokeswoman said: “The changes to the economic environment mean all trusts will need to plan accordingly and some savings will be required. However, we should be clear that these assumptions are a reflection of the risks in the external environment; they are not a directive to make cuts.
“Trusts will need to take account of the individual circumstances that exist within their local health economy, which could mean that they will need to take either a more optimistic or pessimistic approach than the one set out by Monitor."
The Department of Health said the 6-7% estimate was a “downside case”, adding: “But it is right that Monitor's assessments are challenging – we want all hospitals to be able to meet Monitor's standards and show that they can provide sustainable, high quality and efficient services for their patients.”
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