Analyses and policy statements about publicly funded services frequently distinguish `demands' from `needs'. The distinction has been challenged, calling into question the coherence of formulating welfare policy and evaluating public services in terms of needs. This paper explicates the conceptual distinction between in terms of needs. This paper explicates the conceptual distinction between demands and needs in terms of derived demand and information asymmetry. `Needs' can be defined as `rational demands', where `rational' means consistent and evidence-based', and `demands' as `desires' rather than `effective (i.e. economic) demand'. On that basis, practical demand management in needs-based public services would require: 1. knowledge of users' demands for services; 2. Content analyses of users' demands to identify andy misinformed demands; 3. Conversion of any misinformed demands into evidence-based demands on behalf of users who cannot to do so themselves. A study of English NHS Primary Care Groups explores the problems which authorities responsible for publicly funded services face in undertaking these activities. Demand management receives low priority in terms of the incentives and intellectual resources applied to it. Needs assessment has higher priority but is regarded as a branch of evidence-based professional practice, controlled by professionals rather than responsive to users. This separation tends to defeat the purpose of needs-based public services