You will probably have seen the earlier post about HSJ"s story on the effective loss of NHS suprplus underspends.

We have two reactions to that story.

Nigel Edwards, acting chief executive, NHS Confederation
"We have sought and had reassurance from the Department Health that it will protect the surpluses NHS organisations have worked very hard to create. While we have been given this reassurance, if this later turned out not to be the case then this would send a very poor signal to the whole NHS.

Good afternoon to you, on a Friday of economic madness.

Health Service Journal's Sally Gainsbury has found out from the Nuffield Trust's chief economist that the NHS underspends in each financial year since 2007-8 are being removed by the Treasury.

The total in question is some £5.5 billion pounds.

Total Place - what a laugh, eh?

Like Tony Blair, it was the future once.

Then pre-coalition, senior Tories were briefing like mad that it was on the way to the mortuary along with every quango - apart, obviously, from the new, good quangos: Office For Budget Resposibility, NHS National Commissioning Board.

Latterly, the noises coming from the highways and byways of Whitehall suggested that it was not going to be abolished. Perhaps just renamed.

The Institute for Fiscal Studies is the Judi Dench of public policy - a universally-admired, 24-carat National Treasure.

What it says matters, and is taken pretty darn seriously.

Chancellor George Osborne and his colleagues in the Coalition Government may well be unhappy that its review of the CSR broadly disagrees with the self-assessment by Restoration-faced Mr Osborne as "progressive".

Labour's shadow health secretary John Healey MP lost little time getting stuck into Liberatin' Andrew Lansley over the health spending figures used in yesterday's CSR: the text of Healey's letter to The Liberator is copied below.

1. No surprises on funding; either that the protected real-terms funding promise was kept, or that at 0.1% annually in real terms, it was very low. Likewise, no surprise about NHS money going to social care – in fact, the NHS did well to get away with only losing £1 billion. (And I was wrong about it coming from the accumulated NHS surplus – as you’ve doubtless seen, HSJ’s Sally Gainsbury established that it will come out of NHS capital allocation).

Former health secretary and health select committee chair Stephen Dorrell MP is doing a very good job.

Andrew 'Liberatin' Lansley must find it a pain.

Dorrell has written to his successor in the job, to the following effect: "In late August and early September there were a number of stories in the news media reporting that the Department of Health was to close NHS Direct and to replace it with a new helpline, NHS 111.

"I believe the public sector needs to change to support the aspirations and expectations of today’s population, rather than the aspirations and expectations of the 1950s".

...

"Of course, there is understandable concern about the reduction in the total public sector headcount that will result from the measures in the Spending Review. We believe the best estimate remains the one set out by the independent Office for Budget Responsibility. They have forecast a reduction in headcount of 490,000 over the Spending Review Period.

20 October 2010

To: NHS Chairs, Chief Executives and Directors of Finance

Copied to: Local Authority Chief Executives, Regional Directors of Public Health, Monitor and CQC

Dear colleague

The Spending Review settlement
You will have seen the Coalition Government’s announcement of the Spending Review (SR) settlement for the next four years. I am writing to you with further details of what that means for the NHS and our colleagues in social care. David Behan is writing in similar terms to Directors of Adult Social Services.

The Treasury CSR document is here.

The DH summary document is here.

The text of Chancellor George Osborne's speech to the House of Commons is here.

Spending to rise from £104 billion to £114 billion by 2014-15 (2.4% a year, working with 1.9% inflation). That includes capital, which may be unlikely to be spent.