After section 97A of the M1National Health Service Act 1977 (financial duties of Health Authorities and Special Health Authorities) there shall be inserted—

“97AAResource limits for Health Authorities and Special Health Authorities

(1)

It is the duty of every Health Authority and every Special Health Authority to ensure that the use of their resources in a financial year does not exceed the amount specified for them in relation to that year by the Secretary of State.

(2)

In the application of subsection (1) above to a Health Authority no account shall be taken of any use of resources for the purpose of general Part II expenditure (within the meaning of paragraph 1 of Schedule 12A).

(3)

For the purpose of subsection (1) above the Secretary of State may give directions—

(a)

specifying uses of resources which are to be, or not to be, taken into account;

(b)

making provision for determining to which Health Authority or Special Health Authority certain uses of resources are to be attributed;

(c)

specifying descriptions of resources which are to be, or not to be, taken into account.

(4)

Subsections (6) to (8) of section 97A above shall apply in relation to the duty under subsection (1) above as they apply in relation to the duties under section 97A(1) and (2); and for that purpose references to the defraying of expenditure and the receipt of sums shall be construed as references to the incurring of liabilities and the acquisition of assets.

(5)

The provisions in section 97A(3) and (4) above about the giving of directions by the Secretary of State shall apply in relation to the duty under subsection (1) above as they apply in relation to the duties under section 97A(1) and (2).

(6)

Where the Secretary of State has specified an amount under this section in respect of a financial year, he may vary the amount by a later specification.

(7)

In this section a reference to the use of resources is a reference to their expenditure, consumption or reduction in value.”