Health secretary Patricia Hewitt has admitted that the government should have prevented GPs from making so much money from their new contracts.
Hewitt said that doctors’ high salaries were reducing the amount of money available to the NHS to care for patients.
“I think if we anticipated this business of GPs taking a higher share of income in profits we would have wanted to do something to try to ensure that the ratio of profits to the total income stayed the same, and therefore more money was invested in even better services for patients,” she told the BBC News website.
GPs gained new-style contracts in 2004, linking their earnings to the quality of care they provide. They have also given up out-of-hours responsibilities.
Doctors’ salaries have increased by 63% in three years, with the average GP taking home an £118,000 per year in 2005-6, according to the Association of Independent Specialist Medical Accountants (AISMA)
Family doctors working in practices with a pharmacy earn even more, with reports of some earning over £200,000.
The NHS had a budget deficit of £547m at the end of 2006.
Hewitt added: “When we were negotiating the GP contract, we had GPs taking early retirement and very large numbers of new doctors refusing to become GPs.
“Now it is quite true that neither the government nor BMA anticipated how much GPs would do in response to performance-related pay.”