The nonsense that is "cutting admin"

Are there too many managers in the NHS? I don't know, and I have never seen one iota of evidence to suggest that there are too many. The reason why the Conservatives went into the 2010 election saying that they would "cut administration by a third" is simply a gut feeling from Lansley. A political gut feeling. Lansley sensed that the Daily Mail brigade had decided that there was too much administration and as an election ploy he made his pledge to them.

The problem is that the majority of the "administration" that the these armchair auditors were complaining about was in hospitals, and Lansley cannot do a thing about administration in Foundation Trust hospitals because FTs are autonomous and are not run by the Department of Health. The only part of the health service that Lansley could change was Strategic Health Authorities and Primary Care Trusts, and so to meet his gut feeling, one third cut he had no option other than to sack the lot of them by abolishing the organisations. That is a big upheaval based on no evidence at all. (PCTs could well be over-managed, but we have no evidence of this, and no evidence if it is as high, or as low as one third too many. It could even be that PCTs are under-managed.)

All of that is politics and should have been pointed out at the election or afterwards, but it wasn't.

So now the civil servants in the Department of Health are implementing the policy. Government departments have to provide an Impact Assessment document indicating the effects of the policy. The government have just produced an IA for the Health and Social Care (Recommitted) Bill and over the next few days I'll post (or tweet) some items from it. My initial reading is that it is not a dispassionate, neutral civil servant document, instead it is a political document and could easily have come straight out of Conservative HQ. It justifies the policy rather than assessing the impact of the policy. (However, I have yet to read it in detail.)

Let's start with the original IA that was produced when the Bill was first published in January. Here is one example (and there are plenty more in that document) that indicates that this document is largely useless and highly political. The following figures have been updated in the more recent IA but I am giving them to illustrate another point (so if you want the more recent figures - I hesitate to use the term "more accurate" - then you should read the more recent version).

To be able to "cut administration by a third" the civil servants first have to determine how much administration there is. Table A1 says that PCT commissioning costs are £3.59bn (the document also notes that SHAs do very little commissioning so the majority of costs come from PCTs).

The following is Table A2 from the IA document that lists the "savings" that will be made (click on it to see it full size). You can see the £3.59bn in the top left hand corner, and below that the £353m commissioning costs from SHAs. These are "real terms figures" but the table assumes that the same amount of commissioning will be needed over the next ten years (bizarre, because as everyone keeps telling us, there are increasing demands due to the ageing population and new treatments, so it is not a good assumption to make that the amount of commissioning will remain the same for ten years).

The "Real commissioning budget" line takes the idea that administration must be cut by one third by 2014/15, so the figure of £2.63bn in the 2014/15 column is two thirds £3.59bn. The years between ramp down to this level.

What I expected from an IA document was the proof that "administration" could be cut by one third. I expected to see international comparisons, comparisons with the NHS in the past, comparisons with other services that commission services (like, for example, social care). I wanted some figures that said "if we run NHS commissioning like these other guys do, we will save this amount of money". There was no such statement. Instead, we get a table that says "if we cut administration funding by one third the costs of administration will fall to two thirds". Pathetic.

The huge damage that is being wrought on the NHS at the moment is being justified with pathetic documents like this. In the future people will ask "how did you allow this to happen to the NHS?" They will also ask "and on such flimsy proof?".