By Vivienne Russell | 13 December 2012
Auditors have managed to substantiate less than two-thirds of the £5.8bn savings the Department of Health claimed the NHS achieved last year.
The health service is required to save £20bn over the four years to 2014/15 through improved efficiency. Savings of £5.9bn had been forecast for 2011/12 and £5.8bn achieved, according to the DoH.
A National Audit Office progress report found the health service had made a ‘good start’, but was ‘understandably’ making the easiest savings first.
Most were generated through the public sector pay freeze, reductions in the price primary care trusts pay for health care and cuts in back-office costs.
The NAO noted that the department was not required to gain independent assurance about the validity of its savings data. The auditors’ own review found only £3.4bn in efficiency savings, 58% of those claimed by the DoH.
The report also said it was ‘not clear’ what level of savings from reduced operating costs were sustainable over time. But it found consensus in the sector that service transformation, such as a shift from hospital to community-based care, was fundamental to making future savings.
The DoH expects these changes to start having an effect in the latter half of the four-year period.
NAO head Amyas Morse said: ‘The NHS has made a good start in making substantial efficiency savings in the first year of the four-year period when it needs to achieve savings of up to £20bn. To build on these savings and keep pace with the growing demand for health care, it will need to change the way health services are provided and to do so more quickly.’
Commenting on the NAO’s findings, Chris Hopson, chief executive of the Foundation Trust Network, said: ‘Too many of the savings have come from a pay freeze that may end next year. The easiest savings have been made first and are now complete. It gets a lot more difficult from here. The biggest worry of all is that we're not making the major changes to the way health care is provided anywhere near quickly enough. We must address this now or face the consequences later.’
