The open season on NHS bureaucracy rarely brings expected rewards

The coalition claimed its reforms were paid for in part by the abolition of the strategic health authorities, a purge of arm’s-length bodies and the slimming down of the Department of Health. This week Labour declared it will find £100m more for primary care by reducing spending on the bureaucracy associated with competition regulations and reviewing the budgets of Monitor, the NHS Trust Development Authority and commissioning support units. It is unlikely to be the last pledge so financed.

‘With the genie out of the bottle, it is unlikely the scrapping of the competition regulations can force it all the way back in again.’

This tactic always gets a good reception. Few will go into bat for bureaucrats – they have plenty of enemies in the press, public and local commissioners and providers.  However, it is an approach with a poor record of delivering savings. 

When push comes to shove the supposedly unnecessary roles are often required after all; others involve fulfilling commitments that cannot quickly be dispensed with; and then the redundancy bill turns up and everyone starts to looks for something for these supposedly superfluous people to do – witness the birth of CSUs.

This is not to say Labour’s position is without merit. HSJ has reported on the rapidly growing budgets of all the regulators and the press notice accompanying Ed Miliband’s speech cited our research showing many commissioners felt forced into competitive activity by the new regulations against their will. But…

Growing budgets

The view – far from definitive, admittedly – of government policymakers was that the competition elements of the Health Act largely formalised commissioners’ existing requirements. There is no doubt the reforms highlighted the use of competition and sent many scurrying for legal advice. But with the genie out of the bottle, it is unlikely the scrapping of the competition regulations can force it all the way back in again.

‘The need to find more money for the NHS is pressing, but it needs careful planning and is likely to involve harder choices than sacking bureaucrats’

Monitor and the TDA’s budgets are growing largely because of the increased role they are expected to play in sorting out regional and local issues and overseeing the delivery of DH policies – such as this winter’s funding for emergency care. Expect this work to increase as Simon Stevens makes it clear to the health secretary that he believes NHS England is a commissioning body, not another system manager.  

Labour also declared it is “consulting with the sector on how to release even larger savings from the new set of organisations… including by addressing potential duplication of responsibilities and further reducing bureaucracy”.

Leadership vacuum

Good for Labour. But the party should be aware that when Andrew Lansley asked similar questions he heard endless complaints about the overweening DH and SHAs and took the seemingly appropriate action when he got into power. The result was many of the same complainants rueing a vacuum in system leadership and the resulting mission creep for the TDA and Monitor. 

There are savings to be had. Central bodies should have to face the same efficiencies as local organisations and HSJ has long argued that the Heath Robinson genesis of the government’s reforms has created a structure whose need for reform is inherent.

But we would caution against banking any significant savings from the reorganisation of central functions and assuming the proceeds can be diverted to worthy causes like increased primary care spending. The need to find more money for the NHS is pressing, but – as we argued last week – it needs careful planning and is likely to involve harder choices than sacking bureaucrats.