What To Tell George Osborne About How To Save Money

Dr Clive Peedell NHA Party

Last Monday, 3rd August, George Osborne and Greg Hands wrote to all public sector workers asking how the government can do more for less through the Public Sector Efficiency Challenge.

An online survey has been created for people to share their money-saving ideas with the Treasury.

One of our members has made the excellent suggestion that everyone who is eligible should fill in the survey calling for an end to the costly waste of money generated by the market in the NHS. So if that’s you and you haven’t had your invitation to participate, here’s the link.

And here are our recommendations:

1. Stop privatising services, get rid of the market. The market is estimated to cost a minimum of £4.5bn a year in transaction costs such as drawing up tender documents, legal oversight for contracts and endless inter-departmental invoicing. Some estimates put it as high as £9.5 billion.

2. Getting rid of the market and competition means the NHS can once again take advantage of its size in making cost efficient national procurement deals. At the moment the providers in the current competitive framework cannot be mandated by NHS England to use a standard procurement catalogue.

3. Renegotiate PFI deals – hospital trusts are currently spending 2bn/year on repayments. Hospitals and other NHS PFI projects cost approx £12bn to build, but will have cost an eye watering £80bn by the end of the contract term.

Lord Carter of Coles has suggested in his Review of Operational Productivity that workforce costs are a particular priority. We agree, so here are some suggestions on that subject:

4. Stop wasting money on locums – £2.5bn/year (one agency consultant costs the same as 4 NHS staff consultants, an agency nurse costs double a staff nurse) Bring back staff banks in-house. Cheaper to run and more responsive than external private agencies.

5. Stop the attacks on staff contracts. It is driving out experienced staff which is poor management, leading to an increase in use of locums, expensive recruitment drives and inefficient use of resources. Stopping the attacks on staff and bringing staff banks back in-house will make substantial savings on the £1,000 per minute currently spent on agency staff.

6. Stop wasting money on management consultants – £640m/year. Contracts such as US company Virginia Mason teaching ‘lean’ management to 5 NHS Foundation Trusts. In a time of budget cuts to the NHS it is not acceptable that an American private hospital chain should have its ‘growth accelerated’ by a $13 million contract with the NHS. Our public funds should be used for our public investment in front line care.

7. Invest in UK nurse training programmes. Efficiency is often a question of timely investment and forward thinking. Sufficient training for nurses now will save £hundreds of thousands in the future in overseas recruitment.

8. Reverse changes to the Immigration Rules which may affect nurses already working in the service leading to further costly gaps in staffing and expensive recruitment costs.

Or you could keep it very simple and say: reinstate the NHS as a publicly owned and publicly provided service. Respected international comparators show that public health services deliver more for less than private healthcare systems. The more the NHS is privatised, the more it will cost.

If you are not a public service worker you could write to Greg Hands MP or George Osborne MP at the following address or email, saying that you would also like your views taken into account in advance of HM Treasury’s Spending Review: