Healthy Lives, Healthy People: Update on Public Health Funding sets out current thinking on local authority public health finance, including arrangements for the allocation of drug treatment spending from April 2013. The Department of Health states that an active period of engagement and consultation will take place following publication of The Advisory Committee on Resource Allocation's (ACRA) interim recommendations.

As expected, it is proposed that within the overall public health ring-fenced grant for local authorities will be a component to reflect drug treatment need. The Advisory Committee on Resource Allocation recommends that the formula used to allocate this portion of the grant should continue to follow the approach currently used for the PTB and praised as effective by the National Audit Office.

Local areas will not be obliged to spend the drug need portion of their grant on drug treatment but if this then results in fewer people being treated or a reduction in positive outcomes their allocation in subsequent years will be reduced.

In effect this means that from April 2013, the current Department of Health contribution in support of drug treatment would be as 'protected' from disinvestment as it has been since the current PTB formula was introduced.