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Commentary on NHS White Paper

The coalition government today released its White Paper on the NHS. James Gubb, director of the health unit at independent social policy think-tank Civitas said:

‘The Secretary of State for Health, Andrew Lansley, should be congratulated on moves to introduce greater competition in the NHS by granting extra freedoms to foundation trusts, expanding choice for patients and supporting a genuine ‘social market’ through the introduction of meaningful competition law.

Recent evidence on the impact of the competition that already exists in the NHS suggests this is the right course of action to drive value in tight financial times.

However, moves to transfer responsibility for commissioning from PCTs to GPs universally and at such a rapid pace must be cause for concern.

What is proposed represents a huge structural change. The reality is that considerable resources will need to be devoted to the restructuring by: creating new organisations; laying people off in PCTs and recruiting new staff at GP consortia; working out the right blend of risk and reward for GP consortia; creating new accountability frameworks; and implementing new formulas for distributing resources.

All will take time, distract attention, and carry significant risks if got wrong. Evidence from past restructuring of commissioning in the NHS in 2006 suggests a dip in performance of at least one year is likely, which would be ruinous for the NHS’s goal of making £20 billion efficiency savings by 2014.

It is also unlikely that it will cut management costs by 45%; with potentially as many as 500 commissioning organisations replacing 152, transaction costs, for one, will almost certainly increase. Many people, too, will end up re-applying for their old jobs in the new structures.

To complement moves on the provider side, instead of effectively eradicating PCTs, the coalition government should focus attention on developing PCT’s commissioning skills and getting behind them as vigorous, impartial, purchasers of care, able to exert pressure on providers to improve, or to switch services where necessary to new innovative ones (NHS or non-NHS) without fear of backlash. The goal of increasing clinical involvement in commissioning is vital to this, but would be better achieved working through existing structures.’


For more information contact James Gubb on: 020 7799 6677 / 079 3024 3570

Notes for Editors

i. Civitas is an independent social policy think-tank. It receives no state funding either directly or indirectly and has no links to any political party. Civitas’s health policy research seeks to take an objective view of health care in Britain. It aims to offer an improved perspective on how best to deliver equitable and high standards of health care for all.

ii. Recent evidence on the impact of competition between providers in the NHS suggests it has contributed to: improved managerial quality; reduced inequalities in access (in terms of waiting times); improved quality as measured by 30-day in hospital mortality from acute myocardial infarction; and reduced length-of-stay.

iii. Over the weekend Civitas released a study looking at the risks associated with structural change in the NHS. It showed that the last restructuring of commissioning, the merging of PCTs in 2006, led to an average one-year drop in performance in PCTs that were merged and that, again on average, it took three-years for those that were merged to catch up with the levels of those that were not. It can be found here.
The raw data can be accessed here.
The press release can be found here.


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