Healthcare: Costs

Lord Alderdice Excerpts

Monday 15th November 2010 Lords Chamber

[Earl Howe]

My Lords, creating a seven-day service is a particular concern of mine, and the noble Baroness is quite right to raise it, particularly given her long experience in the health service. As for Agenda for Change, any alterations to existing terms and conditions, such as the unsocial hours payment or sick pay, would need to be negotiated in partnership with NHS Employers and trade unions, through the NHS Staff Council.

[Lord Alderdice]

My Lords, I know it is extremely difficult, but has my noble friend had the opportunity to explore how much of the increase in health service costs in recent years has come about because of the increase in administration and management costs? I refer not simply to the salaries of administrators and managers but to the administration for the administrators, and to the amount of time that clinical and professional staff must spend in servicing the requirements put on them by administrators and management.

[Earl Howe]

My noble friend is right to pinpoint this area. If my memory serves me correctly, the average annual increase in management and administration costs over the past 10 years has been 6.2 per cent per year, which is by far and away higher than the increase in costs in clinical areas, for example. That is why we are determined to reduce the administrative cost of running the NHS, and we are in the process of planning for exactly that.