115.This section inserts four new subsections into section 97 of the NHS Act 1977, which is concerned with the funding of Health Authorities. The insertions enable the Secretary of State to increase the initial allocation he makes to a Health Authority where certain conditions are satisfied. The White Paper The new NHS signalled the intention to reward Health Authorities that perform well with modest extra non-recurrent funding.
116.A key intention of this section is to reward Health Authorities who demonstrate most progress in implementing their plan for improving health and health care, the Health Improvement Programme (see section 28 of the Act). Health Authority performance will be assessed against the achievement of targets and objectives set out in their Health Improvement Programmes. All Health Authorities – including those making good progress from a low baseline – will be eligible.
117.The new subsection (3E) enables the Secretary of State to attach conditions to the use of the additional funding. In the case of Health Improvement Programmes, for example, the intention is that these funds will be used to accelerate Health Improvement Programmes by bringing forward projects contained in the later years of these Programmes and to meet the targets associated with that action. The new subsection (3F) enables the Secretary of State to recover the additional funding, if a Health Authority does not meet the conditions attached to it.
Commentary on Sections Part I - the National Health Service Section 8: Payments relating to past performance