In the National Health Service (NHS) in England, Primary Care Trusts (PCTs) are allocated funds by the Department of Health.

The PCTs are responsible for the first line of patient care (e.g. when patients see their general practictioner). If the patient then needs hospital treatment (acute care), the PCTs then purchase (‘commission’) health care from the Acute Healthcare Trusts (which operate the major hospitals). (The system in other parts of the United Kingdom operates differently.) This extract describes the use of Programme budgets within the NHS in England.

11.7 Programme Budgeting is a retrospective appraisal of resource allocation, broken down into meaningful programmes, with a view to tracking future resource allocation in those same programmes.

11.8 Programme Budgeting had its roots in the Rand Corporation in the USA in the 1950s. Its first major application was not in healthcare, but for the US Department of Defence in the 1960s where it was used as part of a cost accounting tool that could display, over time, the deployment of resources towards specific military objectives. Such objectives were looked at in terms of wars overseas, the support of NATO or the defence of the homeland, instead of the conventional ‘inputs based’

budgetary headings of tanks, missiles or diesel fuel. Allocation of new resources, or shifts between budgets, could be judged on their relative contribution to these specific objectives.

11.9 Such an approach can equally be applied to healthcare. Instead of seeing investment on the level of a hospital or drug budget, the focus switches to specific health objectives or medical conditions. The aim is to maximise health gain through deploying available resources to best effect.

Clearly, this aim complements the commissioning role of Primary Care Trusts.

Examples of programmes are:

8 Eye/Vision problems 9 Hearing problems 22 Social care needs

Discussion points
1 What kind of health objectives might be evaluated in the area of ‘eye/vision problems’?
2 Can the term ‘budget’ be applied to a retrospective (backward-looking) appraisal?