Press release: NHS managers set productivity challenge for Secretary of State

15 Jun 2006

On the day the Secretary of State faces NHS leaders at their annual conference, they are calling on her to end the dogmatic pursuit of targets and fundamentally overhaul how NHS success is judged.

Dr Gill Morgan, chief executive of the NHS Confederation, said:

"Whilst targets have a role, the danger is that we chase and  hit them, but miss the point and fail to make care better. NHS managers are calling for a better measurement of success so that the service can focus on what matters most and prove value for tax-payers' money.

Patricia Hewitt is expected to tell NHS Confederation delegates that improving productivity is the key to the future success of the NHS. NHS leaders supported this, with a survey of chief executives showing that 95 per cent believe the NHS must increase productivity and cut waste before they can justify more funding in the government's spending round.

However, they believe there is a major problem with how this improvement is tracked and judged. The current measure of NHS productivity is limited, misleading and at risk of seriously undermining the improvement the public and patients want to see.

The Department of Health is developing a new 'productivity matrix', but NHS leaders are concerned that it does not go far enough. They are calling on the secretary of state to radically overhaul the approach to put patient satisfaction and outcomes at the centre of a new approach.

This is the key message of a new report published today by the NHS Confederation. What is productivity? explains how the current measure of productivity in the NHS used by the Office of National Statistics (ONS) is too simplistic and potentially acts as a perverse driver.  It divides outputs - activities the NHS does such as operations or ambulance trips - by inputs, such as people and capital.  

Using this measure, the NHS would be at its most productive when the maximum number of people are admitted to hospital.  "This is non-sensical as the NHS strives to reduce hospital admissions and treat more people within the community or even in their own homes," says Dr Morgan.

Dr Morgan continues:

"Better drugs, faster treatment, improved technology and increased levels of nursing care are all good for patients and improve the quality of their care, yet all of them decrease productivity under the current ONS measure of productivity.

"We need to drive up the quality of care in the NHS but the good news is that this should also improve efficiency.  Clinical staff are much more likely to want to get behind steps to improve quality and patient experience than the simple pursuit of cost savings.  Over the last few days at our annual conference, NHS leaders have been presented with a variety of examples that demonstrate  it is possible to improve productivity and quality through techniques such as Toyota Lean thinking.

"However, how will we know if we have been successful in our drive to improve patient services through increased efficiency and productivity unless we have a sensible way of measuring it?"

ENDS

Notes for editors

1. The NHS Confederation represents more than 90 per cent of the organisations that make up the NHS. Its members include the majority of NHS acute trusts, ambulance trusts, foundation trusts, mental health trusts, primary care trusts, special health authorities and strategic health authorities in England; trusts and local health boards in Wales; and health and social service trusts and boards in Northern Ireland; 
2. NHS chief executives were asked to what extent they agree or disagree with the following statement:

We must increase productivity and demonstrate we have driven down waste in the NHS before the case for increased funding post-2008 can be justified.

203 chief executives responded and the results were as follows:

Strongly agree (57 per cent - Results: 115)
Tend to agree (38 per cent - Results: 78)
Tend to disagree (4 per cent - Results: 9)
Strongly disagree (0 per cent - Results: 1)

Contact details

Contact Media Relations Manager Joanna Clason on 020 7074 3306 or 07798 571078 or Senior Media Officer Amy Darlington on 020 7074 3304 or 07767 770309.

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