The new government has finally published a report by McKinsey - commissioned by its predecessor but shrouded in secrecy ever since its completion last year - into National Health Service finances.

The report by financial consultants McKinsey makes recommendations on how the NHS can achieve world class productivity and thereby generate significant efficiency savings in a bid to plug multi-billion pound predicted shortfall in funding over the next few years.

According to the report, which was actually presented in March last year but kept under lock and key by Labour, the NHS in England could potentially capture efficiencies in health and healthcare services by between 15% and 22% of current spend, which equates to £13-£20 billion, over the next three to five years.

This reduction, it says, could come from overall technical efficiency savings of £6-£9.2 billion from provider costs as well as savings of £2.7-£4.1 billion from diverting the management of care away from hospitals towards more cost effective out-of-hospital alternatives.

However, as previously leaked last year, the report also effectively recommends a huge cull of jobs, around 137,000, as well as reducing spend on primary care by 11% and community care by 23% (compared to 2008/09), and dropping certain surplus services to help the NHS build up some savings.

Health Secretary Andrew Lansley said he had published McKinsey’s report under the coalition government’s ethos of transparency, and reiterated the commitment to real term year-on-year increases in NHS spend.

He said the report is “is indicative of a top-down internal process intended to cut spending by cutting staff, including frontline staff,” and stressed that “instead of drawing conclusions from top-down analysis, people should examine the unacceptable variance in performance and focus on how staff can be redeployed in order to drive up standards”.