Let’s replace the N in NHS

We’ve been devolving the responsibility in health care for some time, now we need to devolve the power

August 01, 2016
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A few years ago my old boss got into a minor spat with then Health Secretary Andy Burnham over the claim that N is “the most important letter in NHS.” (As I write that sentence it sounds ridiculous, but try and remember the tail end of the Brown government and it makes sense). Burnham argued the centralised nature of the NHS meant that quality could be maintained and action taken quickly if needed. Burnham was wrong, the NHS was too centralised then, and it still is. Recent history has proven that it can’t consistently manage care quality from Whitehall, nor can it make the service financially sustainable. These challenges are essentially local and that is where we must find the answers. We need devolution in the NHS.

At present the health service faces an existential crisis. The £30bn funding gap identified by NHS England is based on a conservative estimate of Treasury investment and increasing demand. The government has already acted to reduce this gap but a significant savings target remains. Simon Stevens’ recent comment that the NHS has a “bloody tough” time ahead suggests there isn’t any new cash coming. Therefore the health service has two options: it can make impotent calls for more money or change.

It would be a mistake for the NHS to indulge its militant reflex at the expense of real reform. I write this because I consider it a genuine threat. The voluntary hospital system we had before the Second World War was dismantled in part because, as Geoffrey Rivett argues, repeated claims of underfunding and bed closures convinced people the “system was insolvent, and might not be worth saving.”

Despite the government providing bridging money in 2015 nearly all hospital trusts are in deficit. There may be an argument for more money, but it would be foolish to think that putting it into the current system would be anything other than a short term fix until the next crisis came along. To ignore the need for NHS reform is worse than putting your head in the sand, it’s more like putting it in the oven. We need an alternative and devolution can provide it.

Now let me address an obvious criticism; yes, significant devolution means a structural change. Conventional wisdom says the last thing the NHS needs is another round of reform. This is a fatal error. To see each recent major NHS reform in isolation is to miss that they are essentially extensions of each other. Blair’s “Patient Choice” agenda, Andrew Lansley’s clinical commissioning group Reforms, and now Health and Care Integration; instead of seeing three politically-driven programmes, I see one long trend towards placing more control into patient’s hand. Whisper it, but we’ve been devolving the responsibility in health care for some time, now we need to devolve the power.

In a recent report released by my think tank, Localis, we make a number of recommendations that could help this to happen.

Firstly, the health service needs greater financial flexibility. Government should allow Clinical Commissioning Groups (the bodies that commission health services locally) to budget over three, perhaps even five years, instead of having to balance a budget each year. Thereby allowing them to pump prime preventative health measures, and, should they emerge, respond to crises more effectively. Secondly, the government should increase the cap on the social care precept. At present, this is set at 2 per cent of council tax; it should be higher or preferably removed entirely. Finally, the government should explore the creation of specific local health taxes. If the local NHS and council have a strong case to raise funds in order to tackle an important local health priority, they should be allowed to institute it.

This may seem quite a radical departure from the norm, but it is actual fairly common in other parts of the world. Places as far flung as New Zealand and Canada have health devolution—even the world’s wellbeing capital and policy wonk Mecca, Scandanavia, has largely devolved health systems. Devolution in the NHS will help support health and care integration, it should give the NHS greater financial freedom, and it could make services more accountable.

I don’t know which the most important letter in NHS is, but I do know that N is the least. It’s time to replace it; we need a Local Health Service.