National Health Service Act 2006

228 Public funding of Primary Care Trusts

(1) The Secretary of State must, in respect of each financial year, pay to each Primary Care Trust—

(a) sums equal to its pharmaceutical services expenditure, and

(b) sums not exceeding the amount allotted by the Secretary of State to the Primary Care Trust for that year towards meeting the Primary Care Trust’s main expenditure in that year.

(2) In determining the amount to be allotted for any year to a Primary Care Trust under subsection (1)(b) (or in varying the amount under subsection (9)), the Secretary of State may take into account, in whatever way he considers appropriate—

(a) the Primary Care Trust’s pharmaceutical services expenditure, and

(b) expenditure which would have been the Primary Care Trust’s pharmaceutical services expenditure but for an order under section 234(2) (special arrangements as to payment of remuneration),

during any period he considers appropriate (or such elements of that expenditure as he considers appropriate).

(3) Where the Secretary of State has made an initial determination of the amount (“the initial amount”) to be allotted for any year to a Primary Care Trust under subsection (1)(b), he may increase the initial amount by a further sum if it appears to him that over a period notified to the Primary Care Trust—

(a) it satisfied any objectives notified to it as objectives to be met in performing its functions, or

(b) it performed well against any criteria notified to it as criteria relevant to the satisfactory performance of its functions (whether or not the method of measuring its performance against those criteria was also notified to it).

(4) “Notified” means specified or referred to in a notice given to the Primary Care Trust by the Secretary of State.

(5) In making any increase under subsection (3), the Secretary of State may (whether by directions under subsection (10) or otherwise) impose any conditions he considers appropriate on the application or retention by the Primary Care Trust of the sum in question.

(6) Subsection (7) applies where—

(a) the Secretary of State has, under subsection (3), increased by any sum the amount to be allotted for any year to a Primary Care Trust,

(b) the Secretary of State has notified the Primary Care Trust of the allotment, and

(c) it subsequently appears to the Secretary of State that the Primary Care Trust has failed (wholly or in part) to satisfy any conditions imposed in making that increase.

(7) Where this subsection applies, the Secretary of State may reduce—

(a) the allotment made to the Primary Care Trust for that year, or

(b) when he has made an initial determination of the amount (“the initial amount”) to be allotted for any subsequent year to the Primary Care Trust under subsection (1)(b), the initial amount,

by an amount not exceeding the sum mentioned in subsection (6)(a).

(8) An amount is allotted to a Primary Care Trust for a year under this section when the Primary Care Trust is notified by the Secretary of State that the amount is allotted to it for that year.

(9) The Secretary of State may make an allotment under this section increasing or reducing (subject to subsection (7)) an allotment previously so made; and the reference to a determination in subsection (3) includes a determination made with a view to increasing or reducing an allotment previously so made.

(10) The Secretary of State may give directions to a Primary Care Trust with respect to—

(a) the application of sums paid to it under this section, or

(b) the payment of sums by it to the Secretary of State in respect of charges or other sums referable to the valuation or disposal of assets.

(11) Sums falling to be paid to Primary Care Trusts under this section are payable subject to such conditions as to records, certificates or otherwise as the Secretary of State may determine.

(12) “Pharmaceutical services expenditure” and “main expenditure” are defined in Schedule 14.