The Pharmaceutical Journal
Vol 270 No 7230 p3
4 January 2003

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PCTs in England get three-year budgets for the first time

Primary care trusts in England have been told how much money they will have to spend on health care over the next three years.

This is the first time that financial allocations have been made for more than one year at a time. It is also the first time that local National Health Service organisations have been funded directly by the Department of Health, rather than through a tiered management structure.

The Department says that the new three-year funding will allow PCTs to make medium-term plans, rather than plan only for the short-term.

Every PCT will see its budget rise by at least 28.08 per cent over three years, with most getting increases below 32 per cent. Seven PCTs, however, will see budget increases of more than 40 per cent over three years. These mainly cover urban and inner-city areas with high levels of poverty and social deprivation.

Secretary of State for Health Alan Milburn said: "The resources are being distributed according to a new, fairer funding formula. Poverty and deprivation cause excess morbidity and mortality. They bring extra costs to local health services. The new formula reflects those costs by using better measures of deprivation and by taking greater account of unmet health needs."

PCTs will be expected to meet all costs from the allocations they have been given, including the additional costs of pay reform, new drugs and treatments, and service expansion.