Monday, October 23, 2006

£2.2bn NHS Waste?

Andy Burnham tribute band

This morning's Daily Telegraph led with a story of £2.2bn waste in the NHS:

"According to an analysis of hospital activities and finances set out by the Government today, if the worst performing primary care trusts did as well as the best, then £2.2 billion could be saved on a range of activities, including how long patients spend in hospitals, the level of "unnecessary" operations and the numbers of sick referred for hospital appointments."

Here's how the potential savings supposedly break down:

Not for the first time we're struck by the incredible precision of the numbers. A man from Mars might well wonder how a government department that had made such an absolute horlicks of spending a doubled budget could possibly know the potential savings from reducing "unnecessary" surgical procedures are £73m, rather than £74m, or £75m, or £5.137bn, or - as is much more likely in the real world - nil?

Yes, yes, we know it's a top-down benchmarking exercise, designed to put some backbone into the managers of "customer" Primary Care Trusts in their "market" negotiations with their hospital "suppliers". But listen to the ministerial twaddle that accompanied it:

"Productivity is about working smarter not harder... We know that for every challenge the NHS faces, someone else in the NHS has a solution... Enabling trusts to compare themselves to other organisations in this way gives local staff the opportunity to identify where they should be focusing their efforts to improve services."

Smarter not harder... challenge... solution... enabling... opportunity... it's like something out of a twenty year old Teach Yourself Management book. And it's being dished out by Comrade Health Minister Andy Burnham, a union hack politico whose only experience of management was... er, well I suppose he did manage to get himself a safe Labour seat. How would you feel as a Primary Trust CEO being forced to listen to that?

We've blogged the real NHS waste picture many times (see here for summary). Briefly, 80% of the extra money has gone into higher costs rather than expanded services (source- Kings Fund), and overall productivity has been falling by 1% pa for at least a decade (source ONS).

£2.2bn is certainly a gross underestimate of waste. And yet more top-down threats and exhortation from the Commissariat will not reduce it. However, unless you're a heavily tattooed transsexual, you're probably going to find yourself having to get that "unnecessary surgical procedure" done privately.

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