Operational Productivity in NHS Providers

Debate between Karin Smyth and Ben Gummer

Wednesday 1st July 2015 Westminster Hall

[The Parliamentary Under-Secretary of State for Health (Ben Gummer)]

It is a pleasure to serve under your chairmanship, Mr Pritchard. It is indeed my first appearance in this role in Westminster Hall and, therefore, under your chairmanship here.

I congratulate my hon. Friend the Member for Hendon (Dr Offord) on securing this important debate. I suspect that, in raising the important matters that he took up in his speech, he did not anticipate the glimpse of the promised land that the debate would give us. I have never sat in a debate on the NHS in this House—I have only been here for five years—when there was such a productive, interesting and bipartisan approach to such an important matter. I hope that it will be a model for things to come.

In seriousness, the differences between us, across the Floor, are far fewer than the things we agree on when we consider the NHS. A new Member, the hon. Member for Bristol South (Karin Smyth), said in her speech that now the election is over we have a fantastic opportunity to forge a greater consensus on the NHS, which will be better for the service and patients, and especially, in the present context, for the people who work in it. They get fed up with the politicisation of the NHS, which has happened since its creation in 1948.

The hon. Lady hit the nail on the head in her excellent speech: efficiency really comes from quality. We begin to get an NHS system that is truly efficient in using the resources that the taxpayer puts at its disposal and the hard work of those who work in it when the first consideration is care quality and safety. If we try to build a system around quality and safety, the efficiencies will flow from that and excessive costs will start to fall out. Part of the problem with trying to find efficiency savings in the NHS—indeed, in any public body or private organisation—is that a purely cost-cutting approach will almost certainly fail, in terms of not only the quality of the product being delivered, but the efficiencies being sought. I very much welcome the hon. Lady’s intervention on that point, because that is where we need to begin.

All of that lies at the heart of Lord Carter’s excellent report. It is an interim report—he will publish his final report, with a great deal more detail, in the autumn—but he has understood that it is the patient who feels the effects of inefficiency first and foremost. Their experience of care is not what it should be, because of how rostering is arranged or medicines are dispensed and administered. He gave specific instances in his interim report—for example, the range of products available for hip replacements—of where choosing one product over another can mean dramatic differences in the occurrence of revisions. As the hon. Member for Strangford (Jim Shannon) said in his speech, cheapest is not always best. Sometimes, a slightly more expensive hip replacement joint can mean a much higher chance that someone does not have to come back for surgery again in a few years’ time. Such decisions about balance lie at the heart of patient care. If we get the balance right, we have a huge prize: better patient care and a more efficient, cost-effective service.

I want to run through the main points of Lord Carter’s report and reflect on them in the terms raised by my hon. Friend the Member for Hendon. The NHS provides a varied picture of efficiency. The service has some of the most efficient hospitals in the world, but also some fantastically inefficient ones. That variation lies at the heart of the problem that we have to square in the next few years, which I will come to shortly when I address the specific points about the £22 billion target. As MPs, we all have anecdotal impressions from speaking to chief executives and managers in the NHS: they have come up with great ideas locally, but one knows immediately that no one is learning from that across the system. That was the case before the 2012 reorganisation, and it was case before all the previous reorganisations; it has been problem in the NHS since its inception.

We must also learn from best practice around the world. There is some fantastic practice around, and not only in France, Spain—specifically Valencia—and Germany; some of the best practice in the world for creating efficient healthcare is in American hospitals. I find it very exciting that there is some fantastic practice coming from Indian hospitals, because it shows how the world is changing. If we can draw in that expertise, we will do better for the NHS. I hope that, at the same time, we will export some of the best practice we have developed here—much of which has come from places not a million miles from the shadow Minister’s constituency—to hospitals and health systems around the world.

The changes in efficiency and productivity gains in the past few years have been considerable. Traditionally, the NHS has lagged behind in productivity improvements, but in the past few years it has overtaken productivity gains in the rest of the economy. Some of that has come from wage restraint, but there has been a genuine improvement in productivity, although it is not as much as we hope, anticipate and need to come over the next five years from system change, rather that just from wage restraint.

Lord Carter’s review covers some of the efficiency savings that can be made, especially in the provider sector. He has identified £5 billion of savings, of which £2 billion can come from improving workflow and workforce costs and £3 billion from static costs related to pharmacies, estates and procurement. As has been mentioned already, he has identified the fact that although there is much dispersed good practice, it is not shared, and there is no common understanding of what a good hospital looks like. On the back of Lord Carter’s principal recommendation, we are going to construct a good hospital. It will be a virtual hospital, so people will not be able to visit it, but they will be able to go to parts of it, because we are going to take the best practice and codify it.

Lord Carter has created a system called the adjusted treatment index, which is a rather dry term for an exciting idea. We will say, “This index is the best that the NHS is doing and we’re going to measure you all against it.” Every chief executive, manager and clinician will be able to see where their particular unit sits against the very best in the country. That will immediately prompt some questions: “Why are we not the best? Why are we a third or half of the way down? What can we do to close the gap?”

The second output from Lord Carter’s report is to provide a suggestion, in base terms, of how the poorest performing hospitals, along with those in the middle and those near the top, can improve and become the best. His final report will give far more detail, but this is of course a living process. We want to create a manual that will help clinicians to constantly improve their performance, measured against the very best—and the very best in the NHS will be measured against the very best in the world, so that our target keeps moving upward.

Lord Carter also identified issues with staffing, agency spend and locums, which formed the meat of the speech by my hon. Friend the Member for Hendon. I will quickly go through what we plan to do. In the long term, it is clear that the expansion of nursing recruitment places will meet our objective to improve staffing ratios and the quality of care in hospitals, but we do have a backlog to fill. I do not want to break the bipartisan consensus, but the fall-off in recruitment places did begin before 2010. It picked up again in 2012-13, partly in response to the recommendations of the Francis report, but we still have some way to go to ensure that we are up to pace.

It has become clear that although there was a need for agency staffing to plug the shortfall, some have been abusing that position. Now that we are getting more and more nurses into the system, it is the right time to bear down on agency costs, which is why the measures outlined by my right hon. Friend the Secretary of State a couple of weeks ago will make such a difference, by giving chief executives the tools to ensure that they are not paying over the odds on agency spend.

[Karin Smyth]

On agency recruitment, does the Minister agree that we should encourage more young people to see the NHS as a good career? Young people such as those in my constituency, Bristol South, do not always get the advantages of university and further and higher education qualifications, and they do not see working for the NHS as a good and positive career. It is still a very good career—well paid and well remunerated by pensions and so on—but it is no one’s job, directly, to sell a career in the NHS in order to bring through the next generation of young people in places such as Bristol South to work in the NHS. That is not a hospital’s direct role. Health Education England is a new organisation and has that responsibility, but, in the spirit of bipartisanship and cross-departmental working, will the Minister take our advice and talk to colleagues in skills and development and support apprenticeships to encourage young people to come through and fill the gap currently filled by agencies?

[Ben Gummer]

I do not want to ruin the hon. Lady’s nascent reputation by agreeing with her again—happily, there are very few Opposition Members present to notice, although that is not an implied criticism—but she is absolutely right. We are lucky that nursing places are quite significantly over-subscribed. The position is popular, but she is absolutely right that we need to not only make far greater use of apprenticeships but widen the skills base in nursing full stop. We are actively working on that in the Department—I have spent much of the day on it, and I am sure there will be more to come.

To help chief executives in this interim period, we have forced all agencies that want to offer their services to ensure that they are doing so through framework contracts, and we are ensuring that there is an hourly cap on the rate that can be charged. We have also taken additional measures on managerial salaries, along with a few other measures, to ensure that managers have the opportunity to be able to manage costs as they wish. We understand, however, that this is the first stage of a much deeper programme of reform that is needed. Lord Carter’s report points in that direction by suggesting that we use our existing workforce far better, so that people are doing the job that they are suited to and qualified for and that their time is not wasted. That is the great win, not only for efficiency and patient care, but for staff enjoyment of their jobs.

The hon. Member for Coventry South (Mr Cunningham) made some helpful interventions about NHS workers’ quality of life. It has been a sad but persistent truth of the NHS for many years—decades, in fact—that staff-reported incidents of harassment and bullying have been higher than the national average and that workforce stress and illness is higher than average. Some of that is to be expected—parts of the NHS are extremely stressful working environments—but we can do much more. Part of that is about ensuring, when people turn up to work, that they are doing the job they wanted to do, with a suitable but not excessive degree of pressure, and that the system is not wasting their time. If we make them happier in their jobs, their patient care will improve and their commitment to the service will be even greater. I am therefore aware of the prize, not just in pounds, shillings and pence, but in an improvement to staff morale and therefore patient care.

NHS Success Regime

Debate between Karin Smyth and Ben Gummer

Thursday 4th June 2015 Commons Chamber

[Ben Gummer]

I do not at this stage anticipate—I have received no indication from NHS England—that the success regime will be extended in any way. I repeat that this is a particular intervention by local people, in co-ordination with NHS bodies, to fix local NHS problems. It they arise elsewhere in the country, I am sure that local people will want to look at them too.

[Karin Smyth (Bristol South) (Lab)]

I congratulate the Minister on what is possibly the fastest reorganisation the NHS has ever seen. Which of those local organisations is in charge, and who will be accountable for deciding what constitutes success?

[Ben Gummer]

I welcome the hon. Lady to her place. We are now repeating discussions we had in the previous Parliament, because I am afraid that the Labour party still does not understand that these decisions are not being directed from Whitehall. I know that is uncomfortable for them, because what they want to do is pull a lever and hope that something happens at the other end, but that does not work. The only way to get success is by having local clinicians, supported by national bodies, providing the solutions that local people deserve.