NHS is now between a rock and a hard place

Most business leaders would be thrilled if their customer base and demand for their services kept expanding. Unfortunately, it’s a bit more complicated when your business is the NHS.

Demand on the NHS continues to grow as the population not only gets bigger but also ages. The result is that the annual budget of the health service – in excess of £100 billion in England alone – is barely enough. And so successive governments have attempted to meet these demands through various means, ranging from simply forking out more cash to seeking ‘efficiencies’, or savings as the rest of us call them.

As a gigantic organisation, the scale of the savings the NHS has to make is equally huge. Under the last parliament, it had to try (but failed) to meet the ‘Nicholson challenge’ of £20 billion in efficiencies. Now, the expectation is that £22 billion can be saved by 2021. Such is the need for savings that The Times has concluded that patient care is now taking a back seat to cost cutting.

In the spirit of cost cutting, Lord Carter has now published his much feted review – concluding significant savings can be found through selling off surplus NHS estate, changing working practices and streamlining procurement and the products used by trusts for patient care. At the same time, the Department of Health has announced plans to cut 650 jobs.

The problem is that much of this has either been heard before, or risks negative unintended consequences. Under utilised NHS estate that costs money is nothing new. High sickness absence within the health service is not exactly revelatory – and who ultimately wants to be treated by a doctor or nurse who are themselves ill? And curbing procurement, while sensible at a macro level, has to be done sensibly and in conjunction with clinical professionals, else patients will ultimately suffer – and incur greater cost to the health service – by not having the services and products they need.

We’re also seeing something of a watershed. The much criticised reforms of former Health Secretary Andrew Lansley (described by then-NHS Chief Executive Sir David Nicholson as so big they could be seen from space) were, in spirit at least, intended to devolve decision making to local levels. But the demand for savings will now usurp that sentiment as the centre once again takes charge.

Ultimately, the NHS, for all laudable recommendations of Lord Carter, finds itself in the same inevitable Oliver Twist-like position of asking for more. Its current resources aren’t enough – Simon Stevens said as much in his Five Year Forward View. Addressing this problem will require fundamental change to improve community delivery of healthcare and prevent costly bed-blocking, particularly amongst elderly and more vulnerable patients. Whether the NHS has either the means or the willingness to undergo such radical change is something we’ve yet to see.