Ed Balls criticises 'hidden bombshell' after �500m of NHS's �900m underspend this year is returned to Treasury
The Treasury has been accused by Labour of failing to publicly disclose its plans to claw back �500m that was allocated for health spending this year.
Figures published in this week's budget show the Department of Health underspent its allocated funding by �900m this year. While �400m will be rolled over for the department to spend in 2012-13, the remaining �500m has been returned to the Treasury. Spending totals for the following two years have been left unchanged.
Ed Balls MP, Labour's shadow chancellor, said: "The tax grab on pensioners was not the only hidden bombshell in the budget. David Cameron and George Osborne have silently taken half a billion pounds from the National Health Service.
"Yet at the same time George Osborne has given a �3bn tax cut to the richest people in the county ? a tax cut worth over �40,000 for the 14,000 people earning over �1m. It tells you everything you need to know about this government that they're prepared to take money from pensioners and our NHS, while giving a tax cut to the richest people in our country."
The figures for the underspend were revealed in the Health Service Journal. The magazine quotes the Nuffield Trust's chief economist, Anita Charlesworth, who said: "Although a number of NHS trusts are in deficit, the NHS is projecting a healthy surplus and the health budget as a whole is forecast to underspend by �900m this year.
"The argument for front-loading efficiency plans was to generate money to reinvest in transforming services so that they would be sustainable in later years as the impact of constrained funding started to bite. Instead it seems that �500m of the savings are not going to be reinvested in new models of service delivery but will instead be channeled towards central government deficit reduction."
A Department of Health spokeswoman did not deny the central allegation but said: "The majority of the underspend is from the capital budget ? mainly from savings on IT systems and better management of budgets. We have already taken advantage of HM Treasury's budget exchange scheme and transferred the maximum amount of the capital budget into 2012-13."
The department added: "There is no going back on our commitment to increase the budget in real terms. But in a massive budget, you never hit the projected spend in real terms, especially on the capital programme, so if there is any money going back to the Treasury it is largely a matter of accounting."
David Cameron in one of his main election promises vowed not to cut the NHS budget. Ministers grappling with the need to make �20bn efficiency savings over the parliament to meet new demands on the health service have always promised that any savings would be ploughed back into the NHS.
The decision not to reallocate the underspend back to the NHS budget was not advertised by ministers on budget day. It came in the week that the government forced the health and social care bill through parliament after nearly 18 months of argument.
Andy Burnham MP, Labour's shadow health secretary, said: "David Cameron and George Osborne have not been honest with the public about their NHS plans. This week we saw the government's true colours; they are handing out tax cuts to millionaires and P45s to nurses.
"The NHS is already suffering as the government holds back billions to pay for their unnecessary top-down reorganisation. The government promised any savings would be reinvested in the NHS. Now we know the truth ? the NHS frontline is taking a hit to pay for tax cuts for millionaires."
Source: http://www.guardian.co.uk/uk/2012/mar/23/labour-attacks-nhs-budget-clawback
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