NHS staffing inefficiencies run deep

James Gubb, 2 August 2007

Reports released this week by the King’s Fund on Agenda for Change, by the Information Centre for Health regarding the GP contract, and earlier in the year by the NAO on the consultant contract have all shown little evidence that any of the contracts have had a positive impact on productivity.
But none of this should come as too much of a surprise, according to an online briefing released on Tuesday by Civitas. Instead, the findings should be seen as symptomatic of deep-seated inefficiencies in NHS staff planning, largely caused by ‘pressures to meet an explosion of central direction that has forced a focus on targets and (later) financial pressures, thereby creating an upward-looking service with short-term goals, rather than one that is truly patient-centred and able to match supply and demand’.

To run briefly over the findings of the aforementioned reports. On Tuesday a report released by the Information Centre for Health, containing the results of the GPs’ Workload Survey, revealed that the average GP worked 36.3 hours a week for the NHS in 2006-07, compared with 43.5 hours in 1992-93. Admittedly this difference is largely due to more GPs working part-time than before, but even those working ‘full-time’ hours worked on average 6.5% less, despite many GPs receiving as much as a 69% increase in pay since 2000/01. The average number of patients seen per week has also fallen, from 122 in 1992/3 to 88 this year, although the average consultation time did increase from 8.4 to 11.7 minutes. And the GP contract at the source of the major increases of pay cost more than anticipated: £250m so in 2004/05 (though benefits of large numbers of GPs achieving QOF targets is not easily quantified).
Slightly earlier in the week the King’s Fund released a report on Agenda for Change, the new pay deal covering all NHS staff except doctors and some managers, which concluded ‘there are few signs that it has delivered increased productivity’. Yes, nurses were probably underpaid previously, but implementing the contract has cost the NHS an estimated £2.2bn and, in 2004/05 alone, came in at £220m over budget. One would have hoped for at least some kind of efficiency improvements.
And to complete the bunch, in April this year the National Audit Office reached pretty much the same conclusion regarding the new consultant contract. It wrote ‘there is little evidence that ways of working have been changed…[and] few trusts have used job planning as a lever for improving participation or productivity’. Yet consultants’ salaries have gone up by 28% since 2001/02 at a cost of £444m and, in 2004/05 alone, came in at £90m over budget.
People like to lay the blame for all this, and the NHS’ staff failings in general, at the feet of managers, but this is far too simplistic.
Yes ‘management in the NHS is far from perfect’, and the rapid increase overall in management (that has been over double the rate of clinical staff since 2000) can be questioned, ‘it would be folly to rile managers without considering the system they are working in…in the NHS managers, administrators and staff as a whole have tended to increase in the wrong places and for the wrong reasons: to meet the latest government targets and objectives, rather than to add value to patient care’.
Faced with a cash-rich, but target driven environment, it was all to natural for NHS organisations to ‘throw new staff into the task of meeting stringent government targets, rather than make real efficiency improvements’. Symptomatic of this:
i. Little attention was paid to long-term costs when expanding the workforce. The number of people employed by the NHS now stands at 1.3 million – a staggering increase of nearly a third since 1999, and far in excess of projections in the NHS Plan (DH, 2000). This is most acute in the case of nurses, whose employment has increased by an astonishing 340% above that expected.
But as boom turned to bust, the over-shooting of workforce growth targets has caused the current bizarre situation of ‘job cuts at the same time as recruitment drives’. Employment in the NHS actually fell by c.9,000 between 2006 (Q1) and 2007 (Q1) according to the Office of National Statistics and of the c.9,000 nurses that qualified between May-September 2006, 31% were unemployed 6 months later.
ii. Inadequate attention was paid to getting the best staff mix. Expansion has not always occurred in the right areas and ‘demand significantly exceeds supply in some specialities’. This is most acute in midwifery, where staff increases have fallen far short of matching the 12.5% increase in the number of births since 200.
The House of Commons Health Committee have also found evidence that ‘the current trend of job reductions has ignored future service and workforce requirements’, with, for example, the number of specialist breast cancer nursing posts frozen, in spite of recent demand for breast cancer services.
iii. Little attention was paid to getting the best out of NHS staff. Significant pay increases were given to hospital doctors and GPs even before the new contracts were introduced for them, of 29% and 14% between 2001/02 and 2003/04.
And, as was referred to earlier, the pay reforms – once they arrived – cost some £540m more than expected in 2004/05 alone, and have had questionable, if any, impact on productivity. ‘It seems as though NHS organisations assumed that paying consultants and nurses more would cause them to become more efficient’.
It’s time for a change. Central planning doesn’t work. It can’t respond to demand, it can’t efficiently direct how contracts should be negotiated and it causes massively perverse incentives, that even the managers know aren’t anything like long-term solutions.
If providers were genuinely independent and there was effective decentralised commissioning – best served by social insurers which would have the proper market-based incentives to respond to patients needs and wishes – much more localised and efficient staffing patterns would emerge.
To read the full report, click here.