News / News review – Queen’s Speech health debate, government policy drip feed and NHS Confederation conference

The past month has been dominated by a drip-feed of policy from the new administration, the build-up to, and aftermath of, George Osborne’s first Budget and some curiously timed publications.

A parliamentary debate on the health measures in the Queen’s Speech largely failed to spark a battle between former health secretary Andy Burnham (left) and successor Andrew Lansley. Perhaps it was because health and education measures were bundled together for debate, so Mr Burnham made his speech following fellow Labour leadership contender Ed Balls, the shadow education secretary. The sharpest exchanges between Mr Lansley and his shadow were over NHS targets and the McKinsey report on the future of the NHS. Mr Burnham insisted the health secretary clarify whether he was having second thoughts about scrapping targets. Mr Lansley insisted control and choice, and ‘sometimes holding people to account publicly’, would drive up standards.

The McKinsey report was commissioned by the previous administration and widely leaked last year, making its publication in early June this year rather curious. Its conclusions were controversial, largely because it recommended making more than 10% of NHS staff redundant and slashing budgets. The report, disowned by the previous government, also said the NHS could have a funding gap of £10bn-£15bn by 2013/14, but the service could save between £13bn and £20bn over three to five years.

NHS London published another controversial report –on the affordability of Lord Darzi’s Healthcare for London reforms – at the end of May. Mr Lansley (left) defended the publication of both documents in the Queen’s Speech debate, saying he was committed to transparency. He added the national McKinsey report was ‘indicative of a top-down internal process intended to cut spending by cutting frontline staff’. While it was important to cut bureaucracy, he rejected top-down programmes and called on the service to examine unacceptable variance in performance and focus on how staff can be redeployed to drive up standards.

Interesting to note the return of former health secretary Stephen Dorrell, who has been elected chair of the Commons health committee. Mr Dorrell was health secretary from 1995 to 1997. Margaret Hodge, the Labour MP for Barking, was also elected chair of the Commons public accounts committee.

Public debt dominated the run-up to the 22 June Budget. And though the government has promised to protect frontline services – and even increase funding in real terms each year – the tightening fiscal position is sure to have an effect on the NHS. There was much talk of a pay freeze – later delivered by the Budget – and revision of public sector pensions. Squeezing budgets in other parts of the public sector – particularly local government, which is bound to affect social services funding – can have a knock-on effect on demand for healthcare and hospitals’ ability to discharge patients at the appropriate time.

Prime minister David Cameron (left) gave a downbeat assessment of public finances in a speech on the economy in early June, and signalled his government would end the ‘public sector boom’ of recent years. Taxpayer-funded services had been insulated from the recession, he argued, and the time had come to get public sector spending ‘back in line’.

Right of centre thinktank Reform went a step further and called on the government to cut NHS spending to reduce the government deficit more quickly. Ahead of the Budget, it insisted the government should reduce the cost of the NHS workforce, increase efficiency and widen the funding base by allowing greater private contributions. It should introduce GP user charges and define core NHS entitlement, which could be supplemented with top-ups and insurance. 

Early summer is conference season for organisations such as the NHS Confederation and various arts and craft committees of the British Medical Association. For those interested in clinical engagement, there was plenty of evidence from the latter’s conferences that the medico-political classes at least hold strong views on NHS finance. The BMA consultants’ conference heard that a fairer NHS funding formula was needed to phase out regional inequalities in England. BMA News reported the conference voted to lobby for a change in the formula because it created differences of more than 40% in the per capita funding for strategic health authorities. Funding formulae are always open to criticism, but is the regional level really the right place to start leveling the playing field?

NHS IT efforts were also criticised in a three-year evaluation carried out by University College London researchers. They found the summary care record and the HealthSpace personal health organiser had shown only modest benefits. Progress had been slow, with ‘deep cultural and institutional divides’. The researchers found no reports of lower costs as a result of the initiatives, though they admitted assessing such costs was beyond their scope.

Researchers from the University of Glasgow’s Centre for Public Policy in the Regions and KPMG criticised the higher levels of health spending in Scotland, compared to England. Their report said the £200 a head more spent in Scotland was not leading to the improved outcomes that might be expected. There was a ‘mysterious Scottish effect’ that went beyond deprivation to make the population sicker and more likely to die earlier. The Scottish government insisted the research was flawed.

The month ended as it had begun, with Andrew Lansley outlining more policy to the NHS Confederation annual conference. Patients and clinicians were at the heart of his vision for the NHS and Mr Lansley promised to alter the payments system to reward performance. ‘If the peak of Everest is a payments system that supports precisely what the commissioners are looking for and that patients need on every occasion, then I’m afraid we’re still at base camp,’ he said. He said the real-terms funding settlement would come with ‘testing challenges’ and the NHS would need ‘discipline’ on management costs and capital projects. Only ‘competent managers’ would be given real freedoms and responsibilities.