“These capital allocations support the ?64billion revenue allocations made to the NHS in 2006/07. These levels of growth will help deliver modern, safe and efficient services across the NHS.
“I know that there are pressures in a small minority of trusts and I have taken decisive action to help turn around the finances of those trusts with the greatest problems. We cannot let this divert from the continued need for investment and modernisation across the NHS as a whole. If the financial situation in some areas dictates that the full programme of investment is not possible in 2006/7, capital funding is not lost: it will be made available in subsequent years for affordable projects which demonstrate value for money for the taxpayer. This allows trusts to plan their finances properly and consider the impact of our recent White Paper on their capital investment plans, such as any longer-term plans to build community hospitals.
“We are making huge changes to the NHS, reforming the system, changing the way we work, and providing more convenient care, closer to patients’ homes. At the same time, it’s important that we continue to provide the funding to modernise NHS buildings and equipment, for the benefit of patients in the long term as well as the short term. Investment in the NHS estate is investment in the future of the NHS.”
– Government departments receive their spending settlements from HM Treasury separated into revenue and capital funding. The two currencies are clearly separate and must be managed accordingly. Departments must live within both their revenue and capital settlements.
– NHS organisations receive clear allocations for both revenue and capital, which are not interchangeable. Governance and financial management in DH and the NHS makes a clear distinction between revenue and capital spending. These arrangements ensure that capital investment is not squeezed out to support revenue expenditure.
– All NHS Trusts, Primary Care Trusts and Strategic Health Authorities (SHAs) will be receiving capital allocations for 2006-07. NHS Trusts and PCTs will each receive Operational Capital for the purpose of maintaining and enhancing their existing capital stock. SHAs will receive Strategic Capital to distribute at their own discretion within their health economy for larger scale investments. Strategic Health Authorities manage the distribution of strategic capital on to NHS Trusts and Primary Care Trusts in their patches by prioritising business cases for capital investment (such as new hospitals).
– NHS Trusts, PCTs and SHAs have received a collective increase in capital of 19% over 2005-06, split between operational and strategic capital as follows:
Operational capital to NHS Trusts and PCTs – 25% increase over 2005-06
Strategic Capital to SHAs – 13% increase over 2005-06
– A list of NHS organisations and their capital allocations is available on the DH website at http://www.dh.gov.uk.
– NHS Foundation Trusts do not receive direct capital allocations. Foundation Trust capital investment is financed locally through cash generated by each Foundation Trust from income for activity or through interest bearing loans.
– Examples of locally planned uses for this money are:
In North Derbyshire, ?9m of this capital will be invested in improving the way mental health services for older people are provided. At the centre of the development are two new wards housing 40 single occupancy beds at Walton Hospital in Chesterfield. This development will result in a more user-focused service provided in the most appropriate environment in accordance with best practice guidelines. In line with the white paper “Our Health, Our Care, Our Say” this facility will also provide vital support for carers as well as patients.
In Bristol, ?6m of this capital will fund a new extension at the Bristol Royal Hospital for Children.
A ?14m single building development at Northampton General Hospital will provide an inpatient renal unit and an interventional cardiology centre. This is an important strategic development in line with local priority that will provide local access to these services. The project also includes the re-provision of nuclear medicine, a primary diagnostic imaging service, within the building.