NHS needs to improve efficiency by 6% per year
By politics.co.uk staff
The NHS will need to rapidly improve its management if it is to make the £20 billion annual efficiency savings demanded by government.
A report by the National Audit Office (NAO) found that even in the boom times over the past ten years, productivity in the NHS as a whole fell by 0.2% per year since 2000, while in hospitals it fell by 1.4% per year.
NAO chief Amyas Morse said: “Over the last ten years, there has been significant real growth in the resources going into the NHS, most of it funding higher staff pay and increases in headcount.
“The evidence shows that productivity in the same period has gone down, particularly in hospitals.”
The amount of money poured into the health service went up by two thirds since 2000.
Auditors found that the problem derived primarily from new NHS pay contracts in 2003, which “increased costs but are not always used effectively by hospitals to drive productivity improvements.”
The news comes despite repeated drives to improve efficiency, such as a ‘payment by results’ scheme of tariffs which, the NAO claimed, produced some positive results in the speed of patient turnover in hospitals.
Other initiatives, such as the ‘productive wards’ scheme, were poorly applied across different areas.
The NAO found a great deal of variation between best and worst-performing hospitals and surgeries – suggesting that if the practises undertaken at the top 25% of institutions were replicated across the NHS, savings of £1.6 billion annually could be made.
Details of poor NHS management are particularly relevant on the cusp of mass reform of its organisation under health secretary Andrew Lansley’s plans.
The health service will need to improve productivity by six per cent annually to achieve the government’s efficiency savings to fund the reorganisation, according to the auditors.
But it will struggle to implement this, the NAO added, because the Primary Care Trusts (PCTs) and Strategic Health Authorities which are responsible for driving efficiency are set to be scrapped by 2013 – to be replaced by local consortia of GPs.
