LONDON (Reuters), Jun 8 - The National Health Service ran up a deficit of over half a billion pounds in the last financial year, government figures showed on Wednesday, but Health Secretary Patricia Hewitt vowed it would break even next year.
The service overspent by a net 512 million pounds in 2005-2006. The figure was slightly lower than media estimates of between 600 and 700 million pounds but more than double the amount predicted by Hewitt in December and also more than double the size of last year's 221 million.
The worst offenders were National Health trusts in the south and east, where outsourcing costs tend to be higher and demand for services is most intense.
Hewitt, who has been fiercely criticized by health workers over her handling of the NHS, stressed the overspending represented just 0.8% of the service's colossal 66.6 billion pound budget.
"The end of year position is the equivalent of a person on an annual wage of 20,000 pounds overspending by around 160 pounds," she told reporters. "It's a problem, but a manageable problem."
But Conservative health spokesman Andrew Lansley accused her of taking "an excursion into a parallel universe" and urged her to return to reality.
"You have had to admit that the deficit is a great deal larger than in the previous year," he said. "Your policy has failed."
Asked whether she would resign if the NHS failed to meet its target of breaking even by the end of the 2006-07 financial year, Hewitt said only that she was prepared to be "held accountable."
Sir Ian Carruthers, acting chief executive of the NHS, acknowledged some jobs might go as a result of the NHS drive to balance its budget next year.
"I accept this may mean workforce reductions in some parts of the country," he said in his annual report. "Compulsory redundancies will be kept to an absolute minimum."
More than 10,000 job cuts have been announced in recent weeks as health trusts struggle to balance their books.
Hewitt was heckled and booed at this year's Royal College of Nursing conference by health workers angered by her claim the NHS was enjoying its "best year ever."
The job cuts have overshadowed the government's record of raising NHS spending to a record 80 billion pounds this year.
Staff numbers have risen by 300,000 since Labour came to power in 1997 to over 1.3 million, making the NHS Europe's largest employer. Hewitt said that if it were a country, the NHS would be the 33rd biggest in the world.
Despite the government's positive message on Wednesday, one of Britain's most senior doctors urged it to halt what he described as "bad policies and shocking incompetence," which he said were damaging patient care and wasting money.
"Care is suffering, jobs are disappearing, patients and staff are paying the price," Paul Miller, chairman of the British Medical Association's consultants committee, told doctors at a conference.
Hewitt described Miller's remarks as "extraordinary."
By Tim Castle
(Additional reporting by Gideon Long)
Last Updated: 2006-06-07 16:35:25 -0400 (Reuters Health)
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