London Councils dismayed at £22 million healthcare cost-shunt

London's local authority leaders have expressed their dismay that at least £22 million worth of healthcare costs is being shunted from debt-ridden primary care trusts (PCTs) on to the capital's boroughs.

At a meeting today, members of London Councils Leaders' Committee warned that the figure is likely to increase as more evidence is collected from the capital's local authorities.

This cost-shunting is putting intense strain on council budgets, and places councils in the unenviable position of having to choose whether to cut services or raise council tax. 

The NHS in London is facing severe financial difficulties, and is currently projecting a revised financial deficit of £55 million. Since last year London council leaders have expressed concerns that PCTs could adopt short-term solutions to their budget problems such as cutting services for vulnerable people and shunting costs on to boroughs. 

London Councils has repeatedly requested an urgent meeting with Patricia Hewitt to discuss these concerns but have been turned down on each occasion - despite mounting evidence that cost-shunting is taking place. The new evidence presented today to Leaders' Committee shows that cost shunting is continuing to grow.

London Councils Chairman Councillor Merrick Cockell said:

"It is clear from the evidence presented today that cost-shunting is already happening. We suspect that the figures we have seen today are only the beginning.

"To have at least £22 million worth of healthcare costs shunted from overspending PCTs to local authorities - which are already under financial strain themselves - is unacceptable. We have made repeated invitations for the health secretary to meet with us to discuss this pressing issue - invitations she has declined despite growing evidence that cost-shunting is already taking place.

"Two thirds of London's local authorities were left on the floor by the last Local Government Finance Settlement so the government knows how strained council budgets already are. If this cost-shunting is allowed to continue it could lead to local authorities having to cut services or raise council tax. Londoners will lose out either way. Borough healthcare budgets cannot and must not be viewed as NHS London's safety net."