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MPs warn Government efficiency plans will ‘test services to the limit’

By Gareth Iacobucci

The Government's NHS spending plans will require unprecedented efficiency savings that will ‘test services to the limit' in the context of the transition to GP commissioning, MPs have warned.

Launching a report on public expenditure today, the House of Commons Health Committee urged the Government to put a concrete figure on how much its NHS reorganisation will cost, in order to fully understand how the transition can be achieved against the backdrop of the ‘Nicholson Challenge' to generate £15-20bn of efficiency savings by 2014.

It came as the BMA warned that cuts to NHS services were already being felt by GPs, despite the Government's pledge to protect the health budget.

The report says: ‘The committee believes it is important for the Gvernment to produce an estimate of the likely cost of its reorganisation proposals. [It] must present a clear assessment of the likely costs, both direct and indirect, and demonstrate how they are to be accommodated into wider spending plans.'

It stressed that the Nicholson Challenge should not be about cuts, but about doing more with the same amount of money, given the NHS budget has remained broadly stable in real terms.

But in its response to the report, BMA chair Dr Hamish Meldrum said this was not being borne out in reality. He said: ‘Like the Health Committee, the BMA is aware of the sheer scale of the unprecedented efficiency savings the Government has demanded from the NHS and we agree that services will be tested to the limit.

‘Doctors have been working hard to help identify how services can be delivered more efficiently without affecting patient care, and are at the forefront of leading innovation and improving services that will benefit patient and reduce costs.

‘However, doctors are also seeing widespread cuts to staffing and services. There is evidence of posts being frozen and services rationed. Despite the Government's pledge to protect the NHS budget, it would appear that the sums are wrong.'

Health Committee chair Stephen Dorrell concurred that there was a ‘serious danger' of the Nicholson Challenge becoming a vehicle for cuts.

He said: ‘The committee believes that there is a serious danger of this objective being lost from view, and agrees with Dr Hamish Meldrum that the Government needs to develop a "better narrative".'

The committee also expressed scepticism about the government's belief that 40% of the efficiency gain required by the Nicholson Challenge (i.e. £6-8 billion) can be achieved by reducing the tariff.

It says: ‘Although the committee recognizes that opportunities exist for efficiency gain as the tariff is reduced, it is concerned that excessive reliance on this instrument will result in both quality reduction and crude cost shunting.'

The report precedes the NHS Operating Framework and the Government's response to its white paper consultation, both of which are due to be published tomorrow.

Credit: Alan Cleaver Flickr Houses of Parliament