The executive chair of NHS foundation trust regulator Monitor has warned that the health service faces a £13 billion annual shortfall by 2013. Dr William Moyes told the Healthcare Financial Managers' Association's recent conference that the pre-Budget Report suggests that the NHS was likely to see annual budget growth beyond 2010-11 at just 1.1 per cent. The NHS has grown used to real-terms budget growth of around 7% in each of the past eight financial years.

Moyes used that 1.1% figure he predicits will be the NHS's lot after 2011, and contrasted it with the sums used in the Securing our future health: taking a long-term view reports written by Sir Derek Wanless for PM Gordon Brown while he was still a humble Chancellor in 2002. The Wanless Reports predicted that to properly fund the NHS would mean a difference of annual funding requirement of £30 billion by 2022, contingent on people becoming 'fully engaged' with their own health as opposed to there being 'slow progress / no change'.

The Kings Fund think-tank published a review of progress with Wanless in 2007, Our Future Health Secured?, which predicted an annual funding shortfall of between £7 billion and £15 billion according to uptake and progress. Its prediction on the population's progress on healtyh outcomes found something between slow and medium progress.

The productivity bonus
Moyes told delegates that if his financial projections were correct, the funding gap he described could only be filled by increased productivity from the NHS. However, he noted that the service sturggles to achieve its current effciiency targets of 0.9%. To cover the shortfall, he suggested that the NHS efficiency would need to deliver over three tiomes that sum - 2.5%.

He also pointed out that the NHS's previous tactic - of letting waiting lists grow - was going to be outlawed under the proposed new NHS constitution, and that cutting quality would reduce the bonus element of hospitals' income under the national tariff. Patients would also, he noted, use choice to avoid poor-quality providers.