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Editor's blog Thursday 18 November: NHS CE Sir David Nicholson's speech to the NHS Alliance conference

It’s really important to learn on focusing attention in areas – on the benefits across whole system as we go, and integration of all government activities on health. That cancer journey (referring to previous presentation) shows how quality is systemic. That’s a very important lesson for us

- the journey, history and context of where we are
- the 6 really big challenges
- the people issues

I’m going to talk about the story of where we are on the journey. Think back to 2004-5, a period which meant a lot to me in terms of lessons learned. 2 or 3 things started, Blair government launched reform programme of FTs and PbR. NHS England also had one of periodic financial difficulties, gross deficit £1.3 bn. On one day, 250,000 people were marching about changes, most of which didn’t happen. A period of great difficulty and real attack on confidence of patients and of staff to lead those changes forward. I and colleagues said, “let’s never allow that to happen again”.

Now, in that envorinment of financial challenge and reform, the NHS leadership lost its way, Not due to bad individuals, or to say they didn’t care, it was a bad environment – politically and socially – it pushed people's focus onto technical changes for services, rather than the real reason why as a senior leadership, we lost our way, Consequences were significant for all sorts of people, we got excited about the changes, while terrible things happened in Mid Staffs wards.

There's a real danger now if we get obsessed with technical aspects of reform. From 2005-6 we started to address that, with the Darzi work in High-Quality Care For All, which were an important process, discussions and debates to try to make quality the organising principle of the NHS. I’ve got charts to show similar results in England and Scotland and Wales, confidence of patients improved.

18 months ago, we looked and asked what is next stage for future of the NHS. Economic circumstances were deteriorating significantly, and we could see global financial problems for UK public sector funding. We did the maths, some thinking, and concluded that in the next period, not be in great place of significant increase in resource (NHS has grown by 1/3 in recent years). There will be little if any growth over the next period. NHS not stand still though funding may, expectations, demographics, medical technology.

We concluded £15-20 bn productivity gains were needed in that period to 2014-15. QIPP at its simplest, esnsures that we never talks about productivity without quality and vice versa. We’ve started to work on that.

If I’d have been here 4-5 months ago (and this is the NHS biggest challenge since inception) talking about these productivity gains, and somebody had said, ‘BTW will you turn the system on its head?’, I would have said “don’t bother” – not because I think the current system’s brilliant. Did any of us believe one more big heave for PBC or WCC would have transformed the system? No we didn’t.

What it’s done has added significant risk to system. We have to try to understand that and manage it. Many GPs’ bread-and-butter is risk. It's important that we get it in the right place, and understand thetat there willl be more risk in system as we go forward.

One thing we know about management of change on this huge scale, touching every bit of the system, health and social care, is that no bit of the system is exempt. All the emphasis has been put on commissioning side, when in my view provider-side change is more radical.

This is massive. It’s such a big change management, you could probably see it from space. We know management of change is not about the brilliance of the vision, and there is a lot to be said for this vision, connecting financial and clinical accountability. It will potentially empower front-line staff, makes NHS far simpler proposition. I find the NHS structure hard to navigate. Simplifying important, but it’s not what will deliver change.

It’s management of transition, we’re going to do and are engaged in now. There are a set of relatively sterile debates over whether this re-organisation is the biggest or top-down – it has to be managed from the front-line outwards. The transition arrangement I’m trying to set out is a set of design principles, that you can see and make happen. If I send something out from the top, it won’t work. This has to be driven by you.

To get the transition right, we need to ensure  we can connect the QIPP agenda and the change agenda, If we treat them separately, we’ll get into a terrible mess.

GP consortia: there’s work ongoing to think what they’ll look like; who’s in / out; governance, … these are important and significant.

Three thoughts:
1. Beware GPs with maps and pens. Building consortia is not about drawing a line on a map. The most successful will start working with practices now, and build knowledge upwards. If we don’t do that, starting at GP practice level, we will end up with a PCT

2. Focus attention on the really important things. In almost all plans for QIPP I’ve seen, managing urgent care / LTCs care is at the heart of it. That will be a more important indicator for me over 2 years than whether a consortia’s governance clever or sparkling.

3. Community services transformation is at the centre of this, and is critical. We need to get over organisational stuff, and get into changing those services. If your community provider is with an acute, ensure they're integrated, and available 24/7. Those issues will make the difference. FTs, have to show that they’re clinically and financially sustainable, which is exactly what we need to do to deliver quality and productivity.

6 things are very important:
1. The issue about patient power, how do we give individual patients more power? A recent survey found that 70% patients thought should have more choice over GP; 70% of GPs thought their patients should have no choice. It’s the issue for primary care – how to give patients more power in terms of information, knowledge understanding and support to manage their condition in a better way?

2. How do we avoid reinventing old system? You can see absolutely how it could happen – the National Commissioning Board takes over from DH; consortia from PCTs. It’s in nobody’s interests to make that happen, because it won’t deliver improvements for patients.

3. There will be tough consequences. We’re moving towards reducing management costs in PCTs, SHAs, DH and ALBs by 45%. That affects about 80,000 people, who are unsure where their futures lie, which is incredibly risky for both the system and bad for us as people in human terms. There is a big issue around commissioning support: we're all committed to GPs getting commissioning support. On 15 December, in the new Operating Framework, we will announce total amount of money available per head of population and it’s remarkably generous, you’ll all be deeply shocked by the size. What to spend it on? Private sector firms wanting to offer commissioning support are very innovative, but can’t take all the work on in one year. If every consortia don’t use PCT staff, we’ll make 80,000 people redundant: the cost of that is £1.5 billion. So we need to be sensible and organised and look after really dedicated people who want to take the service forwards.

4. How can we really embed GP commissioning in the whole healthcare team? You could get a set of GPs over here talking about consortia; and a set of secondary clinicians over there not involved; and another set of other primay care staff over there, also not involved. We need to build all these people into the consortia. And we can’t build consortia without engaging secondary care clinicians, in discussions and governance.

5. Primary care provision is a big opportunity in the next 18 months. Everyone knows some primary care provision is not as good as it can be. Now we can start to tackle it as a significant issue.

6. It’s about investing in skills and capability. It’s important get the right people in the right place.

Finally, this is about leadership, and its importance in significant and great change. Just 2 or 3 things: they're obvious but important for us as leaders.
1. Purpose – think always of why we are here. We have to keep focus attention on quality of service to patients. We have to be obsessed with it over this time: the risks to it are great as we go through this.
2. We must not get obsessed with our own organisations. When new organisation form, those in them tend to stick their elbows out, so it's critical that we avoid that. Patients have to transcend boundaries, and we must ensure we don’t institutionalise set of primary care-secondary care differences.
3. Have confidence that we can make this happen, I've known people develop from fundholding to total purchasing. You've made enormouns improvements for patients; now we have to create an environment where we take this on to the next level.