22 October 2009
By Niall Dickson
The main parties’ health spokesmen took centre stage during the conference season. But as we head towards an election, they will need to spell out how to maintain quality while making necessary savings, argues Niall Dickson
Conferences before elections are always different. There is a sense of anticipation among some, dread among others. The usual rash of announcements that politicians feel the need to generate becomes a torrent as the battle for exciting headlines is fought. This year, the policy manufacturing business was in full swing even in health – where, in the government’s case, there was not much new to say and, for the Conservatives, least said has some appeal (health policy not being a traditional vote winner for them).
First to Bournemouth, though, and the Liberal Democrats. The major theme on health here was money. Politicians are not on the whole suicidal, so it is hardly surprising that thus far not one seems willing to state the obvious – that the looming crisis in public spending will have some impact on clinical staff. The LibDems were no exceptions to this rule.
Instead it was that old favourite the quango and his errant room mate the regulator who felt the blade of the LibDem axe. At the King’s Fund debate at the conference, the party’s health spokesman, Norman Lamb, pointed out that there were 60 regulators inspecting hospitals, asking the same questions, duplicating work and creating a bureaucratic burden on NHS staff. He called for a reduction in the number of regulators and for simple, clear lines of accountability.
It is a fair point and the so-called compact between regulators does not seem to have had the desired result. But this should not blind us to the merits of good independent regulation (which includes better co-ordination, reduced burden, sharing and making better use of data). It is vital for any quality health care system.
And, of course, simply cutting the regulators down to size won’t begin to fill the gap between future demand and projected budgets. To survive the public spending squeeze ahead, hard choices will have to be made throughout the NHS. As more than 70% of the health budget is staffing, it is hard to see how this cost area can be exempt from scrutiny.
On to Brighton and here the mood was... well, not exactly upbeat, but not as depressed as you might imagine. Health Minister Andy Burnham appeared to know something about the future of NHS spending that has escaped the rest of us. He seemed remarkably chipper. ‘I’m not a glass half empty man’, he said.
Despite his apparent optimism, our work with the Institute for Fiscal Studies suggests that whoever is in charge after the next election – and therefore after the current, generous Comprehensive Spending Review period expires in 2011 – will have a hard time finding resources to meet the growing demands on the health service. In fact, the NHS is already preparing for cuts and primary care trusts are planning now to take costs out of their local services.
Burnham had clearly been to the same political training school as Lamb. If in doubt and you need to save, talk about cutting down on administration or, if you want to be rude, call it bureaucracy. For Labour, the target was not regulators (they have had a go at slashing them at least three times over the past ten years) but back-office staff. It is true there are significant savings to be made by merging and outsourcing various functions but that will not deal with the funding gap either. So, it is a good idea but not good enough.
The big shock at the Labour conference was the announcement of free domiciliary care for those in the highest category of need. It was a shock to the commentators, to the delegates and journalists, and one has to suspect it was a shock to many at the Department of Health as well.
The daft bit of all this is that it took the government two years to produce a carefully crafted set of options in a green paper and this announcement came when the consultation on that document still had six weeks to run. The new idea does not fit with the options – in some ways it runs counter to them – and the government had previously been adamant that free personal care was not affordable.
Local government got a bit of a shock too – it will be expected to produce £250m to help pay for it on top of the £420m that the DoH managed to find from within existing budgets with embarrassing speed. No-one was able to say who would suffer from this cut, which does beg the question of why we were spending that money in the first place.
The policy also needs some careful scrutiny. Targeting those in greatest need has a strong appeal, but as ever when you do something for one part of the system there is a danger of creating perverse incentives. This could mean councils encouraging people to move out of domiciliary care (which town halls will have to pay for) into residential care, where the older person might still have to meet the cost themselves.
Then it was off to Manchester and the Conservatives. Well, almost. Just before the conference, the party produced its own social care proposal. This one was a voluntary but government-backed insurance scheme that would provide free residential care for life, if it were needed, for a one-off payment of around £8,000 on retirement. It would be cheaper than the alternatives in the green paper and would answer the endless charge that people have to sell their homes to pay for their care. It is seldom discussed that a move into residential care is a permanent one for virtually everyone.
But, as with Labour’s scheme, there is a risk of a perverse incentive – this time making it more attractive for older people to opt for or be encouraged by their families into ‘free’ residential care rather than stay in their own homes. Such decisions are frequently taken at times of crisis and vulnerability. Details are needed about how this scheme would guard against inflating care home prices, encourage better quality and avoid reinforcing historical oversupply of care homes in some areas.
In his big speech, shadow health minister Andrew Lansley also chose to focus on back-office savings. He repeated his call for a focus on outcomes and an end to process targets. His number two, Stephen O’Brien, did acknowledge that targets could be a good thing – he conceded they could be useful to ‘jump start’ change but quickly added that they had had their day. This is not far from Labour’s acceptance that targets might be subject to a law of diminishing return and that, where possible, they should become entitlements for patients rather than centrally imposed.
So what did we learn as we head into the election period? The politicians will push for management savings and that might not be all bad but the next government will have to support a service that will be busy trying to work out how clinical care can be provided for less without affecting quality or equity.
And while it is great to see the parties bidding against each other to do more for social care rather than putting it into the ‘too difficult to do box’, we do not need piecemeal reform. Better still, why can they not get together and agree a way forward as they have managed with pensions? To solve this issue we need political consensus – now let them get on with it.
Niall Dickson is chief executive of the King's Fund
By Niall Dickson
The main parties’ health spokesmen took centre stage during the conference season. But as we head towards an election, they will need to spell out how to maintain quality while making necessary savings, argues Niall Dickson
Conferences before elections are always different. There is a sense of anticipation among some, dread among others. The usual rash of announcements that politicians feel the need to generate becomes a torrent as the battle for exciting headlines is fought. This year, the policy manufacturing business was in full swing even in health – where, in the government’s case, there was not much new to say and, for the Conservatives, least said has some appeal (health policy not being a traditional vote winner for them).
First to Bournemouth, though, and the Liberal Democrats. The major theme on health here was money. Politicians are not on the whole suicidal, so it is hardly surprising that thus far not one seems willing to state the obvious – that the looming crisis in public spending will have some impact on clinical staff. The LibDems were no exceptions to this rule.
Instead it was that old favourite the quango and his errant room mate the regulator who felt the blade of the LibDem axe. At the King’s Fund debate at the conference, the party’s health spokesman, Norman Lamb, pointed out that there were 60 regulators inspecting hospitals, asking the same questions, duplicating work and creating a bureaucratic burden on NHS staff. He called for a reduction in the number of regulators and for simple, clear lines of accountability.
It is a fair point and the so-called compact between regulators does not seem to have had the desired result. But this should not blind us to the merits of good independent regulation (which includes better co-ordination, reduced burden, sharing and making better use of data). It is vital for any quality health care system.
And, of course, simply cutting the regulators down to size won’t begin to fill the gap between future demand and projected budgets. To survive the public spending squeeze ahead, hard choices will have to be made throughout the NHS. As more than 70% of the health budget is staffing, it is hard to see how this cost area can be exempt from scrutiny.
On to Brighton and here the mood was... well, not exactly upbeat, but not as depressed as you might imagine. Health Minister Andy Burnham appeared to know something about the future of NHS spending that has escaped the rest of us. He seemed remarkably chipper. ‘I’m not a glass half empty man’, he said.
Despite his apparent optimism, our work with the Institute for Fiscal Studies suggests that whoever is in charge after the next election – and therefore after the current, generous Comprehensive Spending Review period expires in 2011 – will have a hard time finding resources to meet the growing demands on the health service. In fact, the NHS is already preparing for cuts and primary care trusts are planning now to take costs out of their local services.
Burnham had clearly been to the same political training school as Lamb. If in doubt and you need to save, talk about cutting down on administration or, if you want to be rude, call it bureaucracy. For Labour, the target was not regulators (they have had a go at slashing them at least three times over the past ten years) but back-office staff. It is true there are significant savings to be made by merging and outsourcing various functions but that will not deal with the funding gap either. So, it is a good idea but not good enough.
The big shock at the Labour conference was the announcement of free domiciliary care for those in the highest category of need. It was a shock to the commentators, to the delegates and journalists, and one has to suspect it was a shock to many at the Department of Health as well.
The daft bit of all this is that it took the government two years to produce a carefully crafted set of options in a green paper and this announcement came when the consultation on that document still had six weeks to run. The new idea does not fit with the options – in some ways it runs counter to them – and the government had previously been adamant that free personal care was not affordable.
Local government got a bit of a shock too – it will be expected to produce £250m to help pay for it on top of the £420m that the DoH managed to find from within existing budgets with embarrassing speed. No-one was able to say who would suffer from this cut, which does beg the question of why we were spending that money in the first place.
The policy also needs some careful scrutiny. Targeting those in greatest need has a strong appeal, but as ever when you do something for one part of the system there is a danger of creating perverse incentives. This could mean councils encouraging people to move out of domiciliary care (which town halls will have to pay for) into residential care, where the older person might still have to meet the cost themselves.
Then it was off to Manchester and the Conservatives. Well, almost. Just before the conference, the party produced its own social care proposal. This one was a voluntary but government-backed insurance scheme that would provide free residential care for life, if it were needed, for a one-off payment of around £8,000 on retirement. It would be cheaper than the alternatives in the green paper and would answer the endless charge that people have to sell their homes to pay for their care. It is seldom discussed that a move into residential care is a permanent one for virtually everyone.
But, as with Labour’s scheme, there is a risk of a perverse incentive – this time making it more attractive for older people to opt for or be encouraged by their families into ‘free’ residential care rather than stay in their own homes. Such decisions are frequently taken at times of crisis and vulnerability. Details are needed about how this scheme would guard against inflating care home prices, encourage better quality and avoid reinforcing historical oversupply of care homes in some areas.
In his big speech, shadow health minister Andrew Lansley also chose to focus on back-office savings. He repeated his call for a focus on outcomes and an end to process targets. His number two, Stephen O’Brien, did acknowledge that targets could be a good thing – he conceded they could be useful to ‘jump start’ change but quickly added that they had had their day. This is not far from Labour’s acceptance that targets might be subject to a law of diminishing return and that, where possible, they should become entitlements for patients rather than centrally imposed.
So what did we learn as we head into the election period? The politicians will push for management savings and that might not be all bad but the next government will have to support a service that will be busy trying to work out how clinical care can be provided for less without affecting quality or equity.
And while it is great to see the parties bidding against each other to do more for social care rather than putting it into the ‘too difficult to do box’, we do not need piecemeal reform. Better still, why can they not get together and agree a way forward as they have managed with pensions? To solve this issue we need political consensus – now let them get on with it.
Niall Dickson is chief executive of the King's Fund
