Labour hits at pounds 300m NHS lay-offs Anger over pounds 300m NHS lay- offs bill

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The Independent Online

Public Policy Editor

The National Health Service has spent more than pounds 300m on redundancy payments over the past five years as the Government's NHS reforms have taken effect, figures released by the Labour Party yesterday show.

Payments have risen almost ten-fold from pounds 11.7m in 1990-91, the year before the reforms, to pounds 113.8m last year, with more in the pipeline following the order by Stephen Dorrell, the Secretary of State for Health, to the NHS to cut pounds 130m from its bureaucracy in the coming year.

The pounds 300m total is enough to provide all the services that Manchester health authority buys in a year.

The figures come from Parliamentary answers by Gerald Malone, the Minister of Health, to Alan Milburn, Labour health spokesman, who claimed the redundancy bill was "sapping the health service's ability to deliver for patients".

The Department of Health said the costs were "the result of the war on bureaucracy" which was leading to millions of pounds being released for patient care. The abolition of the regional health authorities alone will release pounds 150m a year, a departmental spokesman said.

Last year, NHS Trusts accounted for the majority of pay-offs at pounds 75m, while the progressive merger of health authorities with family health service authorities into new health commissions helped account for pounds 24m.

Last year, Mr Malone told Mr Milburn that the largest single factor in district health authority payments was the closure of psychiatric hospitals as mental health services were organised into care in the community. Among the Trusts with the largest redundancy bills, a key factor was reviews of the skill mix of staff.

The biggest single pay-out was made by the troubled South Birmingham health authority which over two years spent pounds 8m on redundancy.

Among Trusts, the Central Middlesex has spent pounds 3.4m, the Wellhouse, also in Middlesex, pounds 3.1m while the merger of Guy's and St Thomas's contributed to a pounds 3.1m redundancy bill.

The scale of the payments follows criticism of the amounts some trusts have spent in redundancy packages for senior managers. The Cheviot and Wansbeck Trust in Northumberland last year spent pounds 524,000 - enough to provide 150 hip replacements - making its chief executive redundant, while the Greenwich and Burnley trusts spent pounds 200,000 and pounds 250,000 respectively in compensation payments to their departing chief executives.

Mr Milburn said yesterday that "only this government could make multi- million pay-offs a priority at a time when the NHS is crying out for more doctors and nurses. Even its pathetic attempt to cut down on bureaucracy has ended up costing the taxpayer a fortune".

The Department of Health said the redundancies had contributed to a higher proportion of NHS staff than ever before being engaged in front-line care.