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NHS Resource Accounting and Budgeting Regime

The Secretary of State for Health (Ms Patricia Hewitt): I am pleased to announce changes to the resource accounting and budgeting (RAB) regime for National Health Service trusts and the impact this will have on the financial position of affected NHS trusts in 2006-07. I am also announcing the allocation of the £450 million reserve to the NHS.

The NHS financial position has shown a massive improvement since last year. A deficit of £547 million has been transformed into a small surplus as reported on 20 February 2007 by the Department in the report “NHS Financial Performance Quarter Three 2006-07, which is available in the Library.

This improved performance of the NHS overall means that we are now confident that we can move NHS trusts out of the RAB regime. This means that NHS trusts will no longer have their income reduced for overspends in the previous year.

This does not mean we are writing off the deficits of overspending NHS trusts, which will still need to generate surpluses to meet their statutory duty. What has been eliminated is the double effect of having both an income reduction and then having to generate a surplus.

This is in line with recommendations set out by the Audit Commission in their “Review of the NHS Financial Management and Accounting Regimepublished in July 2006.

In line with these changes we are reversing income deductions imposed on NHS trusts in 2006-07 under the old RAB regime as a consequence of overspends in 2005-06. This totals £178 million and benefits 28 NHS trusts, as set out in table 1 below.

In support of this change, I am also pleased to announce that we can now allocate the £450 million contingency to the NHS. This is being allocated to strategic health authorities (SHAs) on a fair shares basis meaning that the most needy areas of the country will receive a larger share of the funding in line with our needs based resource allocation formula. Details of the allocation by SHA and the effect this has on the financial position of each SHA economy, as reported at quarter 3, is given in table 2 below.

The first call on this funding is to reverse the £178 million RAB deductions made to NHS trusts in
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2006-07. The balance is available to begin to reverse the funding top sliced from primary care trusts PCT allocations to create SHA level reserves.

As a result of these and earlier reforms, the NHS now has a financial system that ensures fairness, transparency and responsibility. Organisations can now understand
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clearly their financial performance and the consequences and benefits of the management decisions they make. This gives us the firm basis to go forward and continue transforming the services we provide for patients by implementing policies such as 18 weeks.

Table 1: Impact on 2006/07 forecast outturn at NHS trust Level of the reversal of 2006/07 RAB income deductions applied to NHS trusts in respect of 2005/06 deficits
NHS trust nameForecast outturn surplus/ (deficit) as reported at quarter threeNet RAB deductions applied to NHS trusts in 2006/07Forecast Outturn surplus/ (deficit) reported at quarter three after the reversal of RAB reduction

University Hospitals of Morecambe Bay NHS Trust




Hull and East Yorkshire Hospitals NHS Trust




Mid Yorkshire Hospitals NHS Trust




Worcestershire MH Partnership NHS Trust




Cambs & Peterborough MH Partnership NHS Trust




Hinchingbrooke Health Care NHS Trust




Ipswich Hospital NHS Trust




Mid Essex Hospital Services NHS Trust




Princess Alexandra Hospital NHS Trust




Queen Elizabeth Hospital Kings Lynn NHS Trust




Suffolk MH Partnership NHS Trust




West Suffolk Hospitals NHS Trust




Bromley Hospitals NHS Trust




North West London Hospitals NHS Trust




Queen Elizabeth Hospital NHS Trust




The Lewisham Hospital NHS Trust




Whipps Cross University Hosp NHS Trust




Ashford and St Peter's Hospitals NHS Trust




East Kent Hospitals NHS Trust




East Sussex Hospitals NHS Trust




Medway NHS Trust




Southampton University Hospitals NHS Trust




Winchester and Eastleigh Healthcare NHS Trust




Avon and Wiltshire MHP NHS Trust




Gloucestershire Partnership NHS Trust




Northern Devon Healthcare NHS Trust




Royal United Hospital Bath NHS Trust




Swindon and Marlborough NHS Trust




Table 2: Impact on 2006/07 forecast outturn at Strategic Health Authority level of the allocation of the £450 million reserve
Strategic health authoritySHA economy surplus/ (deficit) at quarter 3Shares of £450m pro rata to 2006/07 closing targetSHA economy surplus/ (deficit) including fair share of £450m

North East




North West




Yorkshire and the Humber




East Midlands




West Midlands




East of England








South East Coast




South Central




South West








Home Department

Securing the UK Border

The Minister for Immigration, Citizenship and Nationality (Mr. Liam Byrne): I am today publishing a new strategy entitled “Securing the UK Border”, the terms of reference for the new Migration Advisory Committee (MAC), a summary of the responses received to our recent consultation on establishing a Migration Advisory Committee, and terms of reference for a new Migration Impacts Forum. Copies of all documents have been placed in the Libraries of both Houses.

Effective immigration systems require effective controls. The “Securing the UK Border” strategy is the third in the series of papers setting out how we will henceforth create a new offshore border control system, and strengthen UK border security here at home. It sets out how we intend to strengthen our borders against those who seek to abuse our laws and present a threat to our security
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while at the same time making the system simpler and faster for legitimate, low risk travellers. The main proposals include:

Visa Waiver Test: we will henceforth assume that all non-EEA countries will face a visa regime unless they meet a sufficient benchmark against a basket of immigration, crime, security and economic criteria. A test will be conducted over 2007 with regimes maintained, lifted or imposed during 2008-09. In tandem we will be reviewing the transit without visa concession and the direct airside transit visa regime.

Biometric capture: underpinning our proposals is the need to establish the identity of those seeking to travel to the UK. We will therefore capture the biometrics of all non-EEA passengers before travel to the UK or on arrival.

Visitors: we want to make the rights and obligations of those visiting the UK clearer and more transparent. During 2007 we will consult on the creation of distinct and separate routes for those coming for six months or less as tourists, business visitors and sponsored family visitors.

Forced Marriage: we will also consult on the introduction of measures to address the problem of forced marriage, including raising the minimum age for spouse and sponsor and examining the case for introducing some form of English language test prior to entry for those spouses intending to settle.

We are committed to attracting people with the skills Britain needs from around the world. With our policy set, a points based system will, starting from next year, ensure that we only admit to work and study those migrants with a contribution to make to Britain.

We believe that the UK would benefit greatly from advice from a new Committee of independent experts about where migration is of benefit to Britain and where it is not. There has been a full consultation on our proposals and the response I am publishing today shows strong support from the public.

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The Migration Advisory Committee will be a non-statutory advisory non-departmental public body established from April 2007. It will provide independent and evidence-based advice to Government on specific sectors and occupations in the labour market where shortages exist which can sensibly be filled by migration. In addition the Government may, from time to time, ask the MAC to advise on other matters relating to migration.

Alongside the MAC we are also establishing a new Migration Impacts Forum (MIF) which will provide us with information and input from interested parties on the wider impacts of migration. I will co-chair this body with my hon. Friend the Minister for Local Government and will invite membership from among those with a direct interest in issues associated with the wider impacts of migration from across the UK.

I am also announcing today a number of changes to the immigration rules relating to ministers of religion and international students, including an extension of the science and engineering graduates scheme and the fresh talent: working in Scotland scheme.

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