Milburn plays down call for £60m hospital cuts

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Hospitals in the South-east of England will not have to cut services, the Secretary of State for Health insisted yesterday, despite a letter from a senior civil servant ordering them to make savings to cover a £60m shortfall.

Alan Milburn said the budget gap would be covered by lower than expected spending elsewhere in the National Health Service.

Ruth Carnell, the chief executive of the NHS South-east region, had warned in a letter to health service executives: "I cannot overemphasise the seriousness of our financial position and the impact it has on a national level."

The letter, leaked to the BBC, said she had to report back to Nigel Crisp, the NHS chief executive, outlining what savings could be made.

She added: "I do not want reasons as to why savings cannot be achieved, but proposals as to what savings can be actioned. I recognise that this will mean reductions in areas that do not contribute to national imperatives."

News of the letter emerged as the Conservatives attacked the Government's record on public services. Dr Liam Fox, the shadow Health Secretary, said: "It is going to mean cuts in patient services. I can't see how it can be done otherwise."

Dr Evan Harris, the Liberal Democrat health spokesman, said: "Cash shortfalls and cuts to patient services are not new. This happens every year under Conservative and Labour governments, but the explicit order to cut any service other than those which might impact on Labour's political targets is an unacceptable distortion of clinical priorities."

Mr Milburn said he had told Mr Crisp to ensure that patients were not affected by the problem. He said: "The NHS is spending around £1bn a week. Within that sort of considerable sum of money there is always some slack available for difficult circumstances. There will not be an adverse impact on patient care, because the South-east region will get loans from other parts of the NHS precisely to deal with this."

Government sources attempted to distance themselves from Ms Carnell's letter, insisting that the overspend was only 1 per cent of the regional NHS budget.

Mr Milburn said that he would speak to Ms Carnell about the problems being experienced in her region later today. He said: "The problem in the South-east this year has been a big increase in the prescribing budget of family doctors. That is a good thing, not a bad thing. It means more drugs are getting to more patients. It is probably keeping patients out of hospitals."

The Conservatives lambasted ministers for "incompetence" in the Commons, insisting that too little had been done to cut waiting lists and employ extra doctors and nurses. Dr Fox said the decision to send NHS patients to France for private treatment represented a "national humiliation".

Opening an opposition debate on public services, Dr Fox also highlighted failings in the Government's rail policy and attacked Stephen Byers, the Secretary of State for Transport.

He said: "This Government suffers from intellectual incoherence, inconsistency and incompetence. This has spawned a ministerial culture of blame, spin and reannouncement."

"Blame the professionals, blame the previous government, blame your own predecessor, blame the Third Way, blame anyone but yourself."

But Mr Milburn said he was proud of the Government's record on public services, criticising the Tories' "botched" privatisation of the railways and accusing them of planning to dismantle the NHS.He said: "The Tories ... increased hospital waiting lists by 400,000, we have reduced them by 120,000."