Fundholding GPs sitting on pounds 46m

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GP fundholding raises questions of "probity and value for money", according to an Audit Commission report.

Fundholders have saved pounds 64m on their budgets in a year - but are sitting on almost pounds 50m of those savings. Where they have spent the savings, more than half has gone on improving their surgeries or on office equipment - cash that can improve their pensions as well as patient care.

Andrew Foster, the commission's controller, said there was "nothing illegal or improper about having good premises". But given that the cash was originally all for patient care, the question had to be asked, "is this a good and wise judgement?"

He added: "If there were major patient services not being offered whilst money went into building, then that would have to raise a question, because obviously ultimately the building belongs to the doctor and becomes an asset."

His comments came as the National Health Service waiting list in England stands at almost 1 million. GP fundholding, he said, was "one of the Government's big ideas, and frankly, there's been a dearth of good information about how well it is doing".

Only one-quarter of the pounds 19m that fundholders saved in 1993/94 has gone on direct patient services such as cutting waiting lists or buying additional treatments and care. A further pounds 46m - enough to run the whole of a reasonable sized district general hospital for a year - is unspent and does not have to be spent for four years from the time the saving was made.

The commission's first look at fundholding shows that of the pounds 19m in savings spent by the end of 1993/94, 35 per cent went on premises, 25 per cent on office furnishings and equipment, and 15 per cent on medical equipment. Only 25 per cent went on hospital and community services.

A Department of Health spokesman protested that savings had to be audited and plans made for how they would be spent. "All that takes time, and it is too simplistic to say there is a vast pot of money sloshing around that is going unspent."

Some fundholders returned some of the cash after making "windfall" savings in the first year, but successive waves of fundholders have proved increasingly reluctant to do so.

Almost one in three practices are fundholding, covering 41 per cent of the population. But in some inner cities fewer than 4 per cent of GPs are fundholders while in some rural areas, the figure is almost 90 per cent.

9Briefing on GP Fundholding, Audit Commission; HMSO; pounds 6.