It should make them more inclined to be efficient and waste less when times are lean. If a business is only just breaking even then yes, they will make savings where they can to free up money for either bonuses or for investment in the business. But if a business is successful, and it looks at its profits, and it decides there's enough money there to give everyone a bonus, plough enough money back into the business for growth and development for the upcoming year, and still piss several hundred thousand pounds on redecorating their office block, that's what they do. In the same way a private individual might look at their monthly income, set aside what they need for rent and bills, put another bit aside for food and then split the rest between savings and "money for going out with". The NHS on the other hand doesn't have a profit, it has a loss. No-one has looked at the NHS books and gone "well, we've paid everyone we need to pay, bought everything we need to buy, put extra funds in the areas that need/warrant extra funding (like, um, medical staff getting a living wage) and wow, there's still LOADS of money left over!". And if they have, it's some bloody strange accounting.