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'Be prepared for more cuts'

By Helen Crump

GPs have warned of massive cuts to patient services and renewed pressure to curb referrals following record overspends by PCTs.

Practices said cuts to out-of-hours services were already being made, certain clinical services were being stopped and 'expensive' community hospitals were especially vulnerable.

The GPC told GPs they could face demands for cuts in referrals of up to 40 per cent.

The warnings came after figures from the National Audit Office and the Audit Commission revealed the number of PCTs in deficit in 2004/5 had doubled from the year before to 90.

The number of PCTs with overspends greater than £5 million had increased five-fold to 28. Six PCTs had overspent £10 million-plus.

In addition, the Department of Health said unaudited figures for 2005/6 revealed deficit-stricken trusts were further losing the financial balance battle.

Dr Guy Watkins, chief executive of Cambridgeshire LMC, said Cambridge City PCT and neighbouring South Cambridgeshire PCT had just withdrawn £750,000 from the Camdoc out-of-hours budget.

'It's very difficult to see how that won't have a potentially destabilising effect,' he said.

Dr Nigel Watson, chief executive of Wessex LMCs, said deficit-hit Kennet and North Wiltshire PCT planned to stop funding male and female sterilisation.

He said: 'They are all looking at various ways to dampen down demand for hospital care. The common theme is access to secondary care services.'

Dr Hamish Meldrum, GPC chair, said cuts were inevitable and said some trusts were aiming to reduce referrals by 30 to 40 per cent.

'At best that's going to delay patient care. At worst it may put health and lives at risk,' he said.

The statistics put NHS debt at £536 million, including foundation trusts, but could be much more.

Thirty-one per cent of NHS bodies were predicting a deficit, compared with 27 per cent in 2004/5, with 106 PCTs in deficit. Gross NHS debt is £1.27 billion.

Andy McKeon, managing director for health at the Audit Commission, said managers were vulnerable to 'weakness' this year as they grappled with PCT restructuring and the implementation of PBC and payment by results.

The NAO and Audit Commission said cost pressures had arisen from the new GP contract, the consultant contract, Agenda for Change, access and performance targets as well as poor financial management.

Inherited debts pose threat to PBC

Practice-based commissioning budgets will inherit PCT overspends, experts believe.

GPs said rolling over debts into commissioning clusters will severely handicap their ability to redesign services let alone make savings.

Dr David Jenner, NHS Alliance lead on practice-based commissioning, and a GP in Cullompton, Devon, said it was naive to expect commissioners to be immune from poor financial management at trusts.

'GPs are the custodians of the PCT's budget and if the budget is heavily overspent, you can't magically make it go back to where it should be,' he said.

'Undoubtedly, inherited deficits will be inherited into practice-based commissioning budgets.'

Dr Tony Grewal, a GP in West Drayton, and vice-chair of Hillingdon LMC, said the prospect was bleak for commissioners in his area ­ the second most overspent in 2004/5.

'If practice-based commissioning is handicapped by the debts and errors of previous commissioning mechanisms, and also hampered with the expectation that they will institute recovery on historical debts of this size, it is doomed to complete and utter failure.'

10 worst overspent PCTs 2004/5

Bedfordshire Heartlands - £14.5m

Hillingdon - £13.5m

Suffolk West - £12.5m

Kensington and Chelsea - £12.0m

Kennet and North Wiltshire - £10.2m

Ipswich - £10.1m

New Forest - £8.6m

Wandsworth Teaching - £8.2m

Cambridge City - £7.6m

Southern Norfolk - £7.2m

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