Magazine article Public Finance

Hewitt Agrees to Abolish Rab Penalties to Help NHS Trusts

Magazine article Public Finance

Hewitt Agrees to Abolish Rab Penalties to Help NHS Trusts

Article excerpt

Overspending NHS trusts will no longer face deductions from their resources allocations as the Department of Health has moved to change the rule two days before the end of the financial year.

The reform comes three months after the DoH said it wanted to end the application of that element of the resource accounting and budgeting regime, but did not think it would be prudent, as the NHS neither had the funds nor the financial discipline to do so.

But the rule's demise was Announced in a written statement to Parliament by Health Secretary Patricia Hewitt on March 28.

Hewett said: 'The NHS financial position has shown a massive improvement since last year. A deficit of £547m has been transformed into a small surplus... This improved performance of the NHS overall means that we are now confident that we can move trusts out of the Rab regime.'

Last summer the Audit Commission found that so-called 'double whammy' Rab deductions were not consistent with the rest of the NHS trust financial regime. …

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