THE DEFERRAL of much building work at Birmingham's teaching hospitals by the outbreak of war in 1914, not to mention increased wear and tear of premises during the conflict, ensured the interwar period would be characterised by reconstruction. Though the work of many hospitals during hostilities was subsidised by grants from the Home Office, such funds dried up after 1919 and did not permit the sort of rebuilding that had become obvious to many during the war effort.

Instead, governors aimed to reduce costs and avoid duplication between voluntary institutions by co-ordinating services more effectively. Paradoxically, efforts to co-ordinate hospital work in order to save money and prevent state intervention led to the creation of not one, but two regulatory bodies, the Joint Hospitals Council and the Local Voluntary Hospitals Committee, the latter having been created specifically to dispense £500,000 to voluntary hospitals following a report by the Cave Committee in 1921. Duplication in the regulatory sphere ended in 1925, when these organisations joined forces to become the New Hospital Council, which aimed to maintain the voluntary system, co-ordinate appeals and purchases, and organise systematic contributions from employers and employees. While it has been suggested that the financial situation of provincial hospitals in these years was ‘less acute than in London’, others believed that the boards of the Birmingham voluntary hospitals needed to make greater efforts if they were to survive the interwar period. Co-operative efforts culminated with the decision to amalgamate the General and Queen's hospitals in the mid-1930s and transfer their services to a new Hospitals Centre in Bournbrook.

By this time, modern hospital finance ‘had outgrown the old ticket system’. Unable to rely on traditional sources of income, such as subscriptions, governors turned their attention to a more reliable donor, the paying patient, who became ‘the linchpin of hospital income’ in these years. Though greater proportions of hospital income derived from registration fees and private wards, the vast sums required for maintenance came from hospital contributory schemes. Originating with the Hospital Saturday Fund, Birmingham's contributory scheme provided what many lowincome families regarded as a cheap insurance against the risks of hospitalisation. In return, voluntary hospitals obtained the funds required to maintain and modernise facilities during the interwar period, collections in 1936 alone raising £381,000, a sum equivalent to 85 per cent of hospital costs.