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NHS overheads have doubled, says consultants’ association

Health service administrative costs have doubled and GP fundholding has institutionalised a two-tier system of care as a result of the NHS reforms, according to a report published by the Health Policy Network.

The network, a newly formed group of health professionals, academics and public service managers, argues that the reforms have resulted in 11 ‘problem areas’, including high bureaucratic costs, the conflict between strategic planning and a health care market, a lack of openness in the NHS, financial crises and demoralisation of staff.

It says that the reforms have created ‘serious structural inadequacies which threaten totally to destroy the fundamental principles underlying the NHS’.

The network has formed around a core of doctors from the NHS Consultants’ Association and is loosely associated with the NHS Support Federation.

Professor Harry Keen, chair of both the Health Policy Network and the NHS Support Federation, said: ‘We show from officially published figures that the administrative and management overheads of the NHS have doubled to 11.6 per cent of the total budget.

‘When the Conservatives came to power, the overheads were running at 5 to 6 per cent.’

The network argues that fundholding should be scrapped, but supports the concept of ‘commissioning’ of services by health authorities. It supports the merger of district health authorities and FHSAs into a single authority, but proposes that HA members should undertake not to use private medical care during their period of office.

It also proposes trials of different forms of local accountability by HAs, including directly elected HAs, constituting the HA as a committee of the local authority, or having a mixture of elected and centrally appointed members.

The report is less clear on whether the purchaser-provider split should be maintained, arguing instead for a form of ‘simplified commissioning’ based on a needs assessment process. But it argues strongly that co-operation rather than competition should be the prevailing ethos.

In practice: the NHS market. NHS Consultants’ Association, Hill House, Great Bourton, Banbury OX17 1QH.