Carter Review: setting the scene for savings

12 Feb 16

The long-awaited publication of Lord Carter’s NHS review reiterated that the biggest challenge for the NHS is to deliver efficiency improvements. This will only be achieved by collaboration across the entire healthcare system.

Last week saw the publication of Lord Carter’s long awaited review of NHS cost savings. Among its recommendations were calls for greater transparency on spending, and recommendations on how a model hospital should operate.

As a community, directors of finance will welcome any kind of benchmarking which helps support and guide them in delivering the unprecedented efficiency savings required of the NHS. We expect many will be reviewing the findings and mulling over what may work for their own organisation. HFMA is working closely with them to understand and consider the review’s recommendations and how these can and should be implemented, so we can get maximum value out of each pound spent in the NHS.

Our most recent NHS Financial Temperature Check survey of over 200 finance directors did find some scepticism about Lord Carter’s plans to save the NHS up to £5bn, with most saying they are either not confident (46%) or do not know (53%) if the savings can be made. They wanted more clarity on aspects such as where exactly the savings could be made and how feasible the plans were. The recent report brings us one step closer to getting some answers.

Carter’s report reiterates the biggest challenge for the NHS in 2016 is to deliver the changes needed to achieve the efficiency improvements following the announcement of an additional £10bn in real terms funding at last November’s Spending Review, which was welcomed by the HFMA.

Efficiency and productivity are top of our members’ agendas and they are very open to finding better, sustainable ways of working that lead to cost reductions. However, all parties must be mindful of the immense pressure laid at finance directors in the NHS, and their teams, are under. Lord Carter’s review and recommendations must not be used as a stick to further beat them with. We can only bring about change if they are kept engaged. Ensuring the process of implementing Lord Carter’s recommendations is collaborative and open, rather than top down, with the entire healthcare system working together will be vital to this.

Whilst the current review focuses on hospital efficiencies, there are other hugely significant problems – like the delayed discharge of patients – which will also continue to be a costly drain on resources, and cannot be solved unless the whole of the health and social care system works effectively together. Lord Carter’s report mustn’t mask the what the NHS can and can't afford to provide, or shift the focus from developing different service models for the health service.

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