Huge financial pressure is something CCGs must deal with for many years to come, former cabinet minister Michael Portillo told delegates at the NAPC conference in Birmingham.
In his address to the conference today, Mr Portillo said the £20bn savings being asked for over the next few years is by no means a temporary phase.
Looking to the wider economy he said it could take 20 years for the Eurozone to recover and that austerity was not going to disappear.
‘For all those wondering whether the monies presently available the NHS is a temporary phenomenon or the new world we now have to live with, I would say this is the new world,’ he said.
But he added that he has been struck over the past year by how well the NHS in England has ‘begun to cope with the new financial environment’, while acknowledging that finance directors were concerned with balancing the books in succeeding years now the ‘low hanging fruit has gone’.
Mr Portillo said the NHS had not got to grips with any economies it might find from being such a huge organisation in terms of purchasing power.
‘I would say the NHS had not begun to appreciate the advantages of its scale even though for decades it has suffered from the disadvantages of its scale.’
He added that this was also true for spreading best practice through the NHS.
‘I think if the government is going to support the NHS in achieving £20bn of savings one of the big areas it will need to concentrate is seeking best practice from where it occurs, processing it through the regional offices and pushing it though to areas that have not yet caught up.’
When asked how this view fitted with a strategy of creating CCGs smaller than PCTs had been, he said his take was that CCGs were given less of the budget and more money was being held back.
‘It seems to me there has been a slight of hand and under the guise of localisation a little centralisation has occurred.’
Mr Portillo also told conference delegates he believed the pace of introduction of competition in the NHS may slow up initially as the government kept one eye on the general election.
‘The progress of competition in the NHS is irreversible but in the short term the prime minister got a bit of a shock and was under-briefed about what Andrew Lansley was doing.
‘The election is nearer than it was and the coalition parties are quite sensitive about it so I think in the short term it might be rolled out less aggressively than might have been the case,’ he said.