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Report Cover showing a drawing of a mans head which is transparent to shown the brain

Department of Health – Reducing Brain Damage: Faster access to better stroke care

“Stroke services in England have been improving and there are pockets of excellent practice on which to draw, but many patients are still denied fast and effective treatment and rehabilitation services. At £7 billion a year, stroke imposes significant economic costs. By giving stroke the attention and status it deserves, the Department will be able to make financial savings to the NHS and the wider economy. The NHS can help prevent more strokes and improve treatment, care and outcomes by re-organising services and using existing capacity more wisely. Much can be done to achieve real improvements in patients’ prognosis, treatment and rehabilitation and to reduce the toll that stroke takes on individuals and their families.”

16 Nov 2005
Report cover showing various leaflets about patient safety

A Safer Place for Patients: learning to improve patient safety

“Reducing unintentional harm to patients in NHS hospitals is a central tenet in the management of healthcare quality and risk. Two factors are crucial to this: the establishment of a culture in which incidents can be reported easily, honestly and without fear of blame; and the ability to ensure that lessons learned from these incidents are successfully promulgated to NHS staff both locally and nationally. What today’s report shows is that the Department of Health and the NHS have made some progress in both of these areas – but not enough.
“There needs to be significantly faster progress at the national level in ensuring effective evaluation of numbers, types and causes of incidents. And lessons and solutions must be better evaluated and shared by all organisations with a role in keeping patients safe.”

3 Nov 2005
Report cover showing Norfolk and Norwich hospital

The Refinancing of the Norfolk and Norwich PFI Hospital: How the deal can be viewed in the light of the refinancing

“I have decided to produce a report for Parliament as the issues raised by this case have wider interest in considering how the pricing of PFI deals may change over time. In this case, the Trust continues to pay a premium on its financing costs for being an early entrant into the PFI market whilst benefiting from the early use of the new hospital and lower construction costs. But other factors may affect price comparisons over time and further analysis of price movements would be valuable.”

10 Jun 2005
Report cover showing two men, one looking at the other

Public Guardianship Office: protecting and promoting the financial affairs of people who lose mental capacity

“I welcome the fact that the Public Guardianship Office has improved on the poor performance of its predecessor, the Public Trust Office, which was criticised in a series of reports by the National Audit Office and Public Accounts Committee.

“The Public Guardianship Office must do more, however, to target its scrutiny at the cases presenting the greatest risks. It should also make sure that a larger proportion of the public and professionals know about its work and how to report concerns. The vulnerable people who rely on the Public Guardianship Office to protect their financial affairs deserve the best possible service.”

8 Jun 2005
Report cover

Financial management in the NHS – NHS Summarised Accounts 2003-2004

“Financial management is now a matter of major concern for the NHS. The Department’s welcome policy of greater transparency on financial matters means that many of the old practices which obscured the year-end financial position are no longer possible. We can now see where the real financial problems lie which is the first important step on the way to addressing them. Important reforms like Payment by Results and the new financial regime for NHS Foundation Trusts are also increasing the risks and demand first class financial management. All NHS bodies need to reassess their own financial management arrangements in the light of this report. We will help in that process. For the first time our auditors will now score PCT and NHS Trust financial management arrangements and show clearly what needs to be done to secure improvement.”

NAO head Sir John Bourn said today:

“2003-04 was a relatively stable year in terms of challenges facing NHS financial management but, even so, a number of bodies clearly found it difficult to manage their resources effectively. The major developments taking place in 2004-05 and beyond will pose unprecedented challenges with which all bodies in the NHS will have to deal.

“The NHS faces the considerable task of improving its financial management to meet the new challenges. Both the NAO and the Audit Commission are committed to supporting the NHS in this task.”

Background information

In 2003-04 auditors gave unqualified audit opinions on the truth and fairness of the accounts of all Strategic Health Authorities, Primary Care Trusts and NHS Trusts. The NAO’s Comptroller and Auditor General was therefore able to give an unqualified opinion on the truth and fairness of the summarised accounts of these bodies.

Furthermore the appointed auditors gave unqualified opinions on the regularity of expenditure on all of the Strategic Health Authorities’ and Primary Care Trusts’ accounts, except for 53 Primary Care Trusts in 2003-04. These qualifications arose because of 42 breaches of resource limits and 13 instances of other irregular expenditure (two of these accounts were qualified both for resource limit breaches and for incurring other irregular expenditure). However, NAO head, Sir John Bourn, did not qualify his opinion on the summarised accounts of Primary Care Trusts, since there are no overall resource limits for the aggregate expenditure of these organisations. He also gave an unqualified regularity opinion on the summarised accounts of Strategic Health Authorities.

Financial performance in 2003-04

The aggregate underspend for all NHS bodies was £72 million (0.12 per cent of total expenditure) compared with an underspend of £96 million (0.18 per cent) in 2002-03. 106 NHS bodies (18 per cent) failed to achieve in-year financial balance, compared with 71 (12 per cent) in 2002-03. 24 per cent of NHS Trusts did not achieve break-even and 14 per cent of Primary Care Trusts failed to keep expenditure within their revenue resource limit. In most cases the deficits were small both in absolute terms and in proportion to turnover.

A small number of NHS bodies are struggling to manage large deficits. The number of significant in-year deficits (of over 0.5 per cent of income or available revenue resources) increased to 13 per cent (from 8 per cent in 2002-03). 12 NHS trusts reported a deficit of over £5 million in 2003-04, compared to seven in 2002-03. Four Primary Care Trusts had revenue resource limit overspends of over £5 million compared to three in 2002-03. The number of bodies with significant deficits and the size of those deficits would have been greater without specific financial support either from Strategic Health Authorities or centrally.

No Strategic Health Authority reported revenue overspends in 2003-04. However, Strategic Health Authorities have a target of delivering financial balance in aggregate across the NHS bodies within their area. Seven Strategic Health Authority areas reported an aggregate overspend in 2003-04 compared with six in 2002-03.

Key themes for improved financial management

The NAO and Audit Commission looked at four key financial management themes and made specific recommendations to aid improvement aimed at both the Department of Health and individual NHS bodies.

The four themes are: the role of the board in improving financial management; improving forecasting of the year-end position; the earlier production and audit of the annual accounts; and increasing the transparency of financial reporting.

Financial issues arising in 2004-05 and beyond

There are a significant number of financial management issues that NHS bodies faced for the first time in 2004-05.

Some NHS bodies have experienced increased financial pressures in 2004-05, with auditors currently reporting concerns about financial standing at 32 per cent of NHS bodies and the NHS as a whole forecasting a small financial deficit. The Department is estimating that at least 12 Strategic Health Authority areas will report an aggregate overspend in 2004-05, compared with seven Strategic Health Authority areas in 2003-04 and six Strategic Health Authority areas in 2002-03.

The creation of the first foundation trusts from 1 April 2004 and the need for services to be commissioned from them using Payment by Results has meant that NHS bodies are having to change the way they operate financially. They will in particular have to enhance their risk identification and forecasting skills. These changes will support the Department’s wider agenda for system reform which the Department expects will offer the potential for improved performance.

The introduction of new contracts of employment and the National Programme for IT are also placing pressure on scarce resources. The new consultants’ contract caused particular difficulty in 2004-5 and the Department has made extra money available in 2005-6 to meet the pressures.

Hard copies can be obtained from The Stationery Office on 0845 702 3474. The Comptroller and Auditor General, Sir John Bourn, is the head of the National Audit Office which employs some 800 staff. He and the NAO are totally independent of Government. He certifies the accounts of all Government departments and a wide range of other public sector bodies; and he has statutory authority to report to Parliament on the economy, efficiency and effectiveness with which departments and other bodies have used their resources.

National Audit Office press enquiries:
Barry Lester, Tel: 020 7798 7937
Mobile: 07748 181692

The Audit Commission is an independent body responsible for ensuring that public money is spent economically, efficiently and effectively, to achieve high quality local and national services for the public. Our remit covers around 11,000 bodies in England, which between them spend more than £180 billion of public money each year. Our work covers local government, health, housing, community safety and fire and rescue services.

As an independent watchdog, we provide important information on the quality of public services. As a driving force for improvement in those services, we provide practical recommendations and spread best practice. As an independent auditor, we monitor spending to ensure that public services are good value for money.

For further information about the Audit Commission, visit our website at

Audit Commission press enquiries: Nigel Watts, Tel: 020 7166 2129
Mobile: 07813 315538

2 Jun 2005
Report cover showing people working in the NHS

Department of Health – Innovation in the NHS: Local Improvement Finance Trusts

“I welcome LIFT as an attractive new way of improving primary health and social care facilities. This is an excellent example of a department doing something different and new to come up with an effective solution to an established problem. I fully support this kind of innovation and the department must carefully evaluate this initiative so that all of government, and especially Building Schools for the Future, a similar initiative, can benefit from the lessons that arise.”

19 May 2005
Report cover showing hospital sign

The NHS Cancer Plan: A Progress Report

“Substantial progress has been made in implementing the NHS Cancer Plan, with many targets in the Plan met or on course to be met. This should contribute to the downward trend in cancer mortality rates and continue to bring significant benefits to patients.”

“Cancer networks have achieved much but there is more to be done if they are all to become fully effective: including better planning, more co-ordinated commissioning of cancer services, proper resourcing, and effective co-operation between constituent organisations. As the mid-point of the Cancer Plan is approached, the time is right for the Department of Health to consider how these matters can be addressed and take appropriate action.”

11 Mar 2005
Report cover showing patient undergoing cancer scan

Tackling Cancer: Improving the patient journey

“It is encouraging that large proportions of patients that we surveyed received the care they wanted, and that in many cases there had been a noticeable improvement on the situation in 2000. Importantly, patients were strongly positive about being shown feelings of respect and dignity.

However, there is no room for complacency – even if only 10 per cent of patients with major cancers were dissatisfied with some aspect of their care, that amounts to over 10,000 people a year. We look to the NHS to continue its drive for improvement in patient care, particularly with respect to patients in London and those with prostate cancer.”

25 Feb 2005