26 May 2006
Patricia Hewitt survived the recent Cabinet reshuffle. But her department faces huge upheavals, with newly merged SHAs and PCTs – and a worldwide search for a new health service boss. Seamus Ward reports on the people and places
When Patricia Hewitt entered 10 Downing Street on May 4 many commentators predicted that when she came back through the glossy black door she would no longer be health secretary. In the previous month, she had been barracked by nurses as spiralling NHS deficits led to job losses, attacked by the media for claiming the service had recorded its best year ever and lost her department's permanent secretary and NHS chief executive Sir Nigel Crisp.
Voters were becoming increasingly anxious about the state of the health service and the prime minister was in the midst of a major Cabinet reshuffle. Surely, Tony Blair could not afford to keep her at the Department of Health? But he chose to stand by his health secretary – testament not only to their close relationship but also to the prime minister's belief that replacing her would create uncertainty and disrupt the momentum of his NHS reform programme.
Hewitt now has a second chance and a fresh team to help her take that opportunity. She has two new ministers and will be making new appointments at senior civil service level. She will also be working with new strategic health authorities and primary care trusts.
Social care minister Liam Byrne has moved on to the Home Office and been replaced by Ivan Lewis, a former Commons health select committee member. However, delivery and quality minister Jane Kennedy resigned, saying she was increasingly worried about the government's reforms, particularly the effect of payment by results on children's hospitals. She and 22 other Northwest MPs opposed the appointment of Sir David Henshaw – the former Liverpool City Council chief executive – as chair of the new North West Strategic Health Authority. They say he will be 'extremely difficult' to work with and Kennedy found her position untenable after the appointment was confirmed. Andy Burnham, another former health select committee member, takes her place.
Caroline Flint has been promoted to public health minister, while Lord Warner and Rosie Winterton remain as NHS reform minister and minister of state for health services, respectively.
Jon Restell, chief executive of health care bosses' union Managers in Partnership, calls on Hewitt to grasp the opportunity for a fresh start. 'The secretary of state needs to deal urgently with the loss of confidence among many staff groups caused by job losses. Critically, she needs to do more to address the concerns of managers and staff organisations about the risks and instability associated with the government's reform programme. People are very worried about the potential for individual reforms to work against each other and about the breakneck speed of reform,' he adds.
There will also be changes in the department's team of senior civil servants. A replacement for Sir Nigel Crisp has yet to be found – for the moment Hugh Taylor is acting permanent secretary and Sir Ian Carruthers is acting chief executive.
Hewitt has yet to decide whether to split the posts – Crisp was the first to hold the joint appointment – although the department has hinted it might do so. If it does, the civil service will lobby for a new permanent secretary to come from within its ranks. Taylor will be the obvious choice. Many insiders complain that Crisp, with his health service background, lacked knowledge of how Whitehall works, and therefore had little clout.
Some of the leading contenders for a chief executive-only position have been given the top jobs at the new SHAs. While this would not prevent them from applying to become NHS chief executive, the smart money believes the recruit will come from a US-based health care organisation. Public Finance understands that an international firm of headhunters has been commissioned to identify potential candidates and is looking in North America in particular. If such an appointment is made, he or she will need a 'native' to guide them through the Whitehall jungle.
Other key positions are open, such as the director of workforce, who will have to ensure that the new contracts for most NHS staff begin to produce productivity gains. It is believed that the former head of human resources in one major supermarket chain has made her interest known.
Carruthers has moved to steady the ship in the wake of Crisp's departure. Managers in the service see him as 'one of us' and he will play a key role if the DoH is to regain the confidence of the service. However, he will press on with reform. In a letter to the service on May 10, he insists the NHS must 'continue to drive and, where possible, accelerate' the reform programme.
He has also brought in Andrew Cash, chief executive of the Sheffield Teaching Hospitals Foundation Trust, on secondment as director general of provider development. Cash will be responsible for the finance turnaround teams and service reconfiguration.
The department's former director of performance and programmes, Duncan Selbie, has become director general of commissioning in the face of strong competition from US-based managers. He will focus on developing GP practice-based purchasing and value for money.
There will shortly be enormous change in the structure of the service outside Whitehall. The SHAs will be slimmed from 28 to ten on July 1, while primary care trusts will be cut from 303 to 152 on October 1. More than 70% of PCT boundaries will mirror local authorities and Hewitt expects the changes to release savings of £250m within two years.
The ten new SHAs will be almost completely coterminous with the boundaries of the Government Office for the Regions. One of the biggest challenges will be the single SHA for London (currently there are five) covering 7.4 million people. It was thought Carolyn Regan, North East London SHA chief executive, was a certainty to become its chief executive but the job has been handed to David Nicholson, currently boss of the Birmingham and Black Country SHA.
Mark Britnell – tipped by many to become NHS chief executive in the future – will leave University Hospital Birmingham Foundation Trust to take over the South Central SHA, covering Thames Valley, Hampshire and the Isle of Wight. Carruthers will remain on secondment to the DoH until the end of the year before joining South West SHA as its chief executive. Two SHAs – West Midlands and East England – will readvertise their top posts.
King's Fund chief executive Niall Dickson says the move to fewer SHAs and PCTs is sensible but believes the health service is too busy with other matters – such as regaining financial balance and implementing payment by results – to justify a structural change at this time. 'This is the right policy at the wrong time. This reorganisation has simply thrown the NHS into even greater turmoil,' he says.
NHS Confederation policy director Nigel Edwards says the new SHAs must develop a less hands-on style than some of their predecessors. 'It's about creating leadership and making sure the boards of statutory organisations feel responsible for the running of their organisations.'
Others are happy that all eight SHA chief executives appointed so far have been drawn from the NHS. It is understood that senior managers from at least two local authorities, one charity, three private sector firms and two overseas health care providers were interviewed for the jobs.
'It is significant that these posts have been filled by NHS people, despite a wide field of candidates drawn from other sectors,' says Jon Restell. 'There has been a widespread sense of a leadership vacuum while we waited for these appointments. The new SHA chief executives now have a big job ahead as they lead and support staff of both SHAs and PCTs through the next year of reorganisation.'
One Whitehall source agrees that it is significant that no private sector or overseas candidate, or indeed any part of the wider UK public sector, has been appointed to any of the SHA or DoH posts so far. He says those willing to throw their hats in the ring might not be good enough or perhaps the salary offered is not high enough. But he adds that the high risk of public ridicule, political interference and the difficulty of the jobs might have put off all but battle-hardened NHS managers.
This is bad news for the DoH as it goes abroad in search of someone to fill Crisp's boots and it might yet have to turn to senior NHS managers to make an appointment. One thing is for sure; whoever takes the job will be an exceptional person – exceptionally brave, exceptionally foolhardy or perhaps both.
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