30 June 2006
The National Audit Office has denied accusations that it was unduly pressured by the Department of Health into producing a 'gushing' report on its £12.4bn procurement of a national IT programme for the NHS.
Responding to accusations from the Commons Public Accounts Committee that he had been pressured by the DoH into producing 'the most gushing NAO report ever', head of the NAO sir John Bourn said 'I was not ground down… in fact, the department may feel it was ground down.'
The NAO report, The national programme for IT in the NHS into the DoH's central procurement of an NHS-wide IT system for digitalising patient records, scans and other clinical information found that the DoH had built 'strong VFM mechanisms' into its contracts with IT suppliers such as BT and used the NHS's economy of scale to negotiate 'significant price reductions'.
Because suppliers are not generally paid until after their services have been delivered and were working, the NAO praised the DoH for successfully 'transferring financial and delivery risk to its prime suppliers.' Several suppliers were now experiencing financial losses and 'stress' Richard Granger, DoH director general of IT told the committee, adding: 'better they are than the tax payer.'
Although the procurement strategy protected the tax payer for cost increases, it meant the DoH had less power to force providers to make services available on time and the project was now delayed by at least two and a half years, the NAO found.
Acting NHS chief executive Sir Ian Carruthers said the delays were due to requests from clinicians to pilot aspects of the project, rather than immediately implement them. He added: 'We want a system that works [for the NHS], rather than a system there for its own sake.'
But in a lengthy and tempestuous evidence session, two former DoH clinical leads on the project told MPs that much of that delay was due to the DoH's failure to secure engagement from clinicians which risked rendering the entire project unviable as it was not buying what the NHS actually needed.
Former chief medical advisor to the project Professor Peter Hutton said the lack of clinical engagement had 'a major impact on the viability of the whole programme,' and accused the department of rushing into the procurement like 'a juggernaut lorry driving up the M1.'
The NAO found that the majority of contracts were let within 10 months, compared to an average 27 months for a much smaller single PFI project. Although Richard Granger, director general of IT emphasised that several aspects of the project were now up and running – such as 'Choose and Book' technology, an official from the NAO confirmed that the core, 'clinical record' element of the project 'still has somewhere to go.'
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