The Labour Party has said that Chancellor George Osborne’s assurance of a £3.8bn financial boost for the NHS in England next year has "unravelled".
The Department of Health, for its part, claims the aim behind the package was to help hospitals improve finances with tough controls on agency staff and management consultants. Some measures to bring down costs, which have already been decided by government efficiency adviser Lord Carter, too would be introduced.
The Chancellor announced the additional funding in NHS England's £100bn-a-year budget in the November spending review. The cash boost to counter inflation shows an around 4% increase of in the NHS England's £101bn front-line budget.
But not all are happy with this move. The Labour said the amount would only have to be spent on covering higher pension costs and hospital deficits, which may increase up to £2bn this year. The government, however, contradicts the Labour's assumptions as “something wrong”.
Labour's shadow health secretary Heidi Alexander said, “George Osborne's promise of extra money to the NHS is more spin than substance… The scale of the financial challenge facing the NHS means that there are now real doubts about whether this money will be sufficient to repair hospital finances, let alone deliver the Tories' promise of a 'seven-day NHS”.
The Labour cites a parliamentary answer to argue that the pension reforms would cost the NHS employers a further £1.1bn a year. This added to £2.2bn trust deficits would define it all, it says.