§ Mr. Gwilym JonesTo ask the Secretary of State for Wales when he intends to announce the future arrangements for allocating revenue funds to district health authorities in Wales.
§ Mr. David HuntHealth authorities were consulted in January on options for a weighted capitation formula to be used to determine each authority's share of revenue resources. Copies of the consultation paper "Implementing the White Paper: Options for a Weighted Capitation Revenue Resource Allocation Formula" are in the Library of the House.
After considering the responses from authorities, I have decided that the most appropriate basis for the formula is as set out in option 4 of the consultation paper. This option takes account of the review of the relationships between morbidity, social deprivation and health needs carried out for the Department by Dr. Carr-Hill of York university. Copies of his review were circulated with the consultation document and are in the Library of the House. I shall also be arranging for it to be published. The formula retains the weighting for sparsity included in the existing revenue assessment formula. This is in recognition of the additional costs of providing services to scattered populations in rural areas.
179WEach DHA's share of resources, according to the formula, compared with its share of gross discretionary recurrent revenue resources for 1991–92, is shown in the table:
Percentage share of revenue funding 1991–92 Formula share Clwyd 13.52 14.24 East Dyfed 9.02 8.77 Gwent 14.87 15.20 Gwynedd 8.18 8.78 Mid Glamorgan 19.14 19.05 Pembrokeshire 3.68 3.87 Powys 4.76 4.15 South Glamorgan 14.00 13.09 West Glamorgan 12.83 12.86 Health authorities will need time to adjust to their new formula shares and there is also some uncertainty about the effect of revised population estimates following the 1991 census on formula shares. For these reasons the
Annual change in revenue resources as a percentage of previous year's allocation at constant prices Year 1992–93 1993–94 1994–95 1995–96 1996–97 1997–98 1998–99 1999–2000 2000–01 Clwyd 1.28 1.25 1.17 1.17 1.17 1.17 1.16 0.45 0.45 East Dyfed 0.00 0.00 0.05 0.05 0.05 0.05 0.05 0.45 0.45 Gwent 0.53 0.59 0.84 0.84 0.84 0.84 0.84 0.45 0.45 Gwynedd 1.76 1.67 1.39 1.38 1.38 1.37 1.36 0.45 0.45 Mid Glamorgan 0.00 0.00 0.52 0.52 0.53 0.53 0.53 0.45 0.45 Pembroke 1.20 1.18 1.14 1.14 1.14 1.13 1.13 0.45 0.45 Powys 0.00 0.00 -1.97 -2.02 -2.08 -2.14 -2.21 0.45 0.45 South Glamorgan 0.00 0.00 -0.70 -0.71 -0.72 -0.73 -0.75 0.45 0.45 West Glamorgan 0.00 0.00 0.66 0.66 0.66 0.67 0.67 0.45 0.45 This assumes 0.5 per cent. per annum real terms growth in overall discretionary revenue provision, exclusive of capital charges element, in line with resource planning assumptions previously issued to DHAs. However, resultant figures above are expressed as a percentage of total revenue allocations—with capital charges element added back in.
The table shows that there will be a redistribution of resources with the allocations of two authorities, Powys and South Glamorgan, being reduced to their capitation shares after 1993–94, subject to the review in 1993. The changes affect the purchasing positions of health authorities, but the provision of services will depend on where purchasers choose to place their contracts. The future of individual hospitals will therefore not always depend on the relative funding position of the authorities in which they are located.