Editor’s blog Monday 20 September 2010: Cuts, nuts and sledgehammers

Good morning. Welcome to another week of health policy mayhem.

Cuts in public services – what the state does nationally and locally – have a win-lose-lose effect.

The Treasury wins, as it always will in the end.

The people who receive the service lose, obviously - very few public services are created which benefit no member of the public, however indirectly.

And the providers of the service, be they public, not-for-profit or private sector (and of services to the service – mainly private) lose – be it their job, contract or business.

So far, so obvious. It’s unlikely to be best for the state to enshrine provision in aspic. When cuts have to be made, the lowest-value services should go.

The challenge facing the cut-maker in the health sphere is that service provision still tends not to be wildly opulent. Look at access to psychological therapies, or indeed children’s services (as Sir Ian Kennedy’s report last week pointed out, still bad after all these years).

Money has gone on major pay rises for most staff, buildings, PFI, waiting lit initiatives and management transaction costs. Back in  the bad old days of one-year settlements, canny managers learned to design in some fat when more budget than expected was received. It is unclear whether much of this has occurred over the past decade.

This oncoming wave of reform will see cuts – although not in the real-terms budget, health will be indirectly and seriously affected by the reduction in budgets of local government. It will have to manage this alongside the QIPP (the acronym for “save £20 million in three years or you’ll lose your soon-to-be-redundant job even sooner) pressures, while working through a management architecture that is being dismantled over the next couple of years.

About the biggest and heaviest thing I’ve ever cut is firewood. When cutting by hand, you can just about use the logpile itself to steady the log. You can only do so much by hand, so you get a chainsaw.

Chainsaws are great – powerful, efficient, but dangerous. You soon learn that you need a solid saw horse to hold your logs, so they don’t spin or buck.

And you have to keep the chainsaw well-oiled and under strong but not destructive tension.

Nuts and sledgehammers
Professor Nick Bosanquet used a nice line about the policy intention of using the national tariff to effect change in the NHS: “like using a nut to crack a sledgehammer”.

The current thinking among policymakers in the DH is that in their statutory commissioning consortia, GPs are going to take the lead in driving out bad performers and overspenders from the NHS where PCTs, SHAs and all their predecessors failed.

This is an heroic assumption. The variation in performance and activity is by no means confined to the acute sector. The evidence that clinicians enjoy regulating their peers and do so effectively is, to put it charitably, slight.