Edward Leigh MP, chairperson of the Commons Public Accounts Committee, said of the 372 PCTs and acute trusts in England, 82 recorded a deficit, which totalled £917m.
The committee’s Report on the NHS Summarised Accounts 2006-2007 added that 80% of the deficit was being reported by just 10% of organisations.
Mr Leigh said: ‘Even though the overall quality of healthcare looks to have been improved, some Primary Care Trusts limited the amount of healthcare they delivered either to make savings or because their budgets were cut.
'Bad financial management at local level can have significant consequences for patients: there is a clear link between the financial performance of a body and the quality of its clinical services. This is a lesson which must be driven home across the NHS, to both financial and clinical staff.
'Another lesson is that local bodies must be able to demonstrate that they have provided a level of healthcare that meets local needs. Large surpluses will prompt the question why this money could not have been used to deliver a higher level of healthcare.'
RCN general secretary Peter Carter said: ‘For more than two years, the RCN has been saying that financially driven reforms have a negative impact on the quality of care.
‘It is imperative that ministers learn the lessons of the deficits crisis by ensuring that smart workforce planning and quality driven reforms are central to Lord Darzi’s Next Stage Review,’ he said.