Nicholson stresses need for central grip on NHS finances

Central control of NHS finances needs to be tighter than before during the transition to the new system, according to Sir David Nicholson.

Addressing the Local Government Association, the NHS Chief Executive argued that the “turbulence” of rapid change combined with austerity measures made temporary centralisation of funding essential.

The current financial crisis of the South London Healthcare trust showed the importance of ensuring that all hospitals meet Foundation Trust criteria, he said.

The NHS reforms imposed by New Labour in 2004 had “lost control of the money”, Nicholson claimed, and that could not be allowed to happen this time.

The two economic priorities were that every hospital should be financially sustainable and every CCG should be free of legacy debts, he said, adding: “While much of the talk is about localism, in practice I have more national control over the money in the NHS than we have ever had.”

Nicholson also said the current NHS reforms would “shift the centre of gravity” towards local government, driving the integration of health and social care – and to assist that, the NHS was “committed to transferring resources to social care”.

The NHS was currently in discussion with the LGA to agree on a strategy for effective collaboration, he revealed.