Friday, June 16, 2006

NAO Report On NHS Supercomputer

The long-awaited NAO report on the NHS mega-IT project was published today. In truth, Mrs T and I are currently in the Med taking in some rays, so I haven't yet properly digested its 63 pages.

But the big picture is that the NAO estimates total costs at £12.4bn. What's more, they set out a detailed breakdown of their figures- the first time we taxpayers have been given any detail at all. But they also warn ominously:

"This is not a budget but an amalgamation of fixed price contracts, extrapolation of costs beyond the contract periods and provisional forecasts of other costs."

In other words, don't be surprised if it goes a lot lot higher. Because while £12.4bn is five times the government's original figure, it's a whole lot less than £30-50bn quoted by industry insiders.

Bizarrely, it's also a lot less than the £20bn quoted by Lord Warner only a couple of weeks ago. Apparently, his civil servants told the NAO he got that wrong. Well, I guess why would he know? He's only in charge.

Which is a pretty fair summary of the whole thing- the numbers are all over the place. And the £3.4bn the NAO have pencilled in for local costs are clearly little more than a stab in the dark.

The report needs much closer study, but one thing that immediately jumps out is the estimate of benefits. Because you'd have to think we wouldn't be spending all this dosh unless government was pretty clear about the benefits, right?

Er, wrong:

"It was not demonstrated that the financial value of the benefits exceeds the cost of the Programme. The Treasury’s guidance states that benefits should be valued when possible, but recognises that sometimes they cannot be. In this case, the Treasury has accepted the Department’s approach and has approved all expenditure so far made and planned."

So for the biggest IT project in world history, it was not thought necessary to quantify the benefits.

And as for the sharp-end- the local health trusts etc who have had this whole thing imposed on them and who are now having to cut spending elsewhere to meet its open-ended costs:

"NHS Connecting for Health has not sought to monitor systematically the actual impact the Programme is having on local IT spending or the extent to which the initial estimates of its impact are being borne out in practice. However, it believes that experience of individual deployments so far will enable local savings on a substantial scale."

It believes, huh? How very reassuring.

And the most jaw-dropping sentence spotted thus far?

"Some of these [efficiency] savings are planned to contribute to the Department’s Gershon economies."

The Gershon economies. Those things that only exist in the Chancellor's Marx Brothers script.

Madness on madness. The Circle is complete.

No comments:

Post a Comment