NHS Efficiency: who’s kidding who?

Yesterday (29 March) I gave evidence to the Treasury Select Committee on this year’s Budget. I concentrated on the so-called ‘efficiency’ savings. One of the things I pointed out was the frankly fantastic projections for savings in the Health service – something which strangely no-one seems to have noticed.

The Government is pledged to make “efficiency savings” (I use the word “efficiency” very loosely) of £4.36bn per year by 2012/13. That is challenging enough – it’s roughly 4-5% of the NHS budget.

But what seems to have escaped everyone’s attention is the pledge to make savings of “£15-£20bn” per year by 2013/14. (Budget section 6.14) In other words to treble or quadruple the “efficiency” savings in only a year to around 15-20% of the NHS budget.

This is an extraordinary level of proposed ‘savings’. And the alleged step-change from one year to the next is frankly incredible.

The biggest single saving – £3.5bn by 2013/14 – is due to come from increases in staff productivity – this after 10 years or more of declining productivity in the NHS according to calculations by the Office of National Statistics. Who’s kidding who here?

Below are the (only) details set out in the Budget and accompanying press release from the Department of Health of what is going to be achieved – there’s next to nothing on how.

By 2012/13 £4.36bn pa savings of which:

–£1.5bn from procurement

–£555m productivity and sickness

–£100m from IT 9as part of £600m ‘lifetime costs’)

–£60m energy use

–£70m estates

By 13/14 £15bn -£20bn pa of which:

–£2bn procurement

–£3.5bn staff productivity

–£2.7bn long-term care

–£1.5bn commissioning

One thought on “NHS Efficiency: who’s kidding who?

  1. Well spotted Colin. Those of us in the NHS thought we were aiming for £15-20 billion over a 4 year period, not per annum. It must be a mistake?

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