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Editor's blog Tuesday 8 February 2011: Sir David Nicholson evidence to Bill committee - rough transcript

David Nicholson - Uncorrected rough transcript, Health & Social Care Bill committee (whose online feed is here).

This is a very rough transcript indeed. But topical.

DN: Commissioning Board decide shape of tariff – so give org £10K to look after total healthcare of individual with diabetes, or that decide based on no of people treated. Economic regulator set price as in actual number, to ensure have vibrant provider side. Legislation has clever way of locking us together to get joint agreement on price.

Q: so have to jointly agree?

DN: yes

Q: Your aim to ensure no PCT debt take on but you can’t guarantee

DN: That is my ambition

Q: PCTs to reduce admin costs by 30%. would they have met that anyway?

DN: we did consider impact, and irrespective of reforms, could have sustained 151 independent orgs acting as are now, I would say couldn’t. This change necessary to achieve QIPP.

Q: would PCTs have hit those cost reduction targets?

DN: We always do, but would have had to change configuration of PCTs.

Q: Indicative cost of PCT and general admin in PCT now?

DN: Total cost of SHA and PCT commissioning is £5.1 bn across NHS – and plan as part of NHS financial position to reduce to £3.4 bn at end of session.

Q: In most NHS reorganisations, productivity drops. How measure next 2-3 years?

DN: set of measures in QIPP plans. individual organisations vary but productivity measures by ONS limited but important. quality gains we want to see, normally set out in terms of numbers of lives saved.

Q: Costs of reorganisation £1.4 bn impact assessment. Varies from NAO impact assessment, who say £15m per org. DH scaled down by reducing estimated costs of redundancies, and suggesting large orgs break NAO understanding of costs of reorganisation. Comptroller General has not validated DH figures. Given you will appear at PAC in 2 yrs, happy?

DN: We believe figure in PAC robust based on previous reorganisations – we think it’s good and can stand by. In redundancy, and whether consortia buy NHS commissioning support or go outside, rightly a freedom

G Morris: in your evidence to health select committee 19.11.10, you said commissioning caricatured as transaction, has major strategic element. My point danger of un-strategically planned open market. Monitor to enforce competition – surely strategic planning against this?

DN: really important point. part of benefit of new system more integrated care, idea con only d managing it yourself, which simply haven’t delivered. Will be many support – critical thing how they connect – commissioning is means. Partnership working over years, clinical protocols, tendering – all are tools to use to improve services for patients. Other issue, in some places for too long, put up with sub-optimal services because of too cosy relationship between commissioners and providers and individual providers. In terms of economic regulator there to prevent that, think right

G Morris: economic regulator and price competition, what about 1.5% tariff reduction to FTs and impact on jobs?

DN: I don’t accept economic regulator means price competition. tariff is about competition on quality not price. in present arrangements, no doubt acutes must make significant productivity gains. important thing in timetable here is govt protected NHS expenditure,. money save by cost reduction programme not go elsewhere, recycled in NHS to improve service. too much emphasis on cost reduction, too little on how provider better services. exact balance of clinical and non-clinical staffing

Steve Wright: commissioning board – you CE-designate, and will have regional structure – for dental service commissioning, sitting with board, how will you commission in Winchester and NE England?

DN: in early stages, trying to think all this through. you highlight dilemma – national body, also commissioning v local services, so will need people working for board al local level. I think things we could centralise much more in commissioning – will not get away from requiring some more local presence. Winchester dental market different from Durham

Q: when something right in NGS, triumph of govt policy; when wrong, fault of individual NHS trust- how will this change?

DN: most plaudits local anyway, and local newspapers clear relationship with local trusts, and do get plaudits. think accountability will be clearer. now too easy to say ‘govt is to blame’ – real problem of accountability. FTs and local membership should hone sense of local accountability in way not seen, and health and wellbeing board should increase sense of local accountability. think will see and feel more local NHS through this

Phil Woolton: giving GPs loads of budget evolutionary or revolutionary?

DN: almost every PCT had {PBC arrangements, can build. consortia don’t get budgets to 2013, not tomorrow. time to work through and understand what works and what not,, and can authorise once they demonstrate to Commissioning Board

Q: is this revolutionary or evolutionary?

DN: neither – bold and imaginative

Q: this is going from 1st gear to 5th – you said largest ever change, can see it from space

DN: it is significant change. I was on Friday in (unheard), geared up and taking budget form 1 April 2011. Parts of country far from that.

Q: devolving NHS to GPs and making more localised, while national commissioning board – yet you say, end up employing local people to administer all this. re-employ people made redundant from PCTs?

DN: lots of Qs there. do imply significant devolution and accountability, but also involve some centralisation, giving patients clearer accountability and national standards. will have local people delivering locally as part of corporate whole. ever employ people made redundant by PCTs? putting in place system to minimise – MARS already, scheme – schemes to minimise, last thing need to do sped money on redundancy and the re-employ

Q: PCT structure by another name?

DN: different. most PCT function go to consortia, but some national (dental). doing lots of back-office stuff nationally, but will need local flexibility

Jeremy X: 3 Qs from Mid-Staffs – local govt health and wellbeing boards. expertise available to health OSCs might not be sufficient to enable to do job – how envisage?

DN: perfectly understand why appears so, but HWBoards will have public health expertise on their side, and dir of public health for LA, bring big capacity of understanding. then engagement of general practice in local govt, in pathfinders, some GPs and local govt invisible to each other, but GPs in ground have lot to offer, and engaging GPs in HWBs will add capacity. and National board can engage with HWBs

Q: approval of FTs – clear problem in Mid-Staffs. all to FT by 2014 – how ensure no repeat of Mid-Staffs, and aware some PFI contracts mean some will not be able to do financial return sue to PFI cists

DN: Mid-Staffs bad for patients and service as whole, and v quickly learning lot of lessons. FT process snow has quality written right through as never before – FTs must be signed off by NHS medical director – need to continue to learn, and national quality board reporting Feb to give staff individual tools and techniques to ensure report concerns early. going through all FT applicants trying to categorise into groups, over 70 of those organisation relatively straightforward, about robust clinical and financial plans. Are then others in difficulty now or have PFI schemes making v hard to hit due diligence, and will have to deal with each individually, and going through case by case.

Q: accountability – Mid-Staffs still not quite sure who will aggregate evidence in future of a trust failure. where will accountability lie?

DN: in  board of organisation involved. strengthening with powers of local governors and members crucial. would be nice to say one org can be responsible for all, nature of healthcare makes v hard. CQC responsible for co-ordinating orgs and using risk scoring, bringing in board to solve problems when do occur

Q: v interesting – what costs associated?

DN: depends what can centralise back office and do nationally. I have indicative sum for commissioning board at end of process. Now over 5,000 people working in PCTs on commissioning, must be 1/3 less, but gives indication of how much local work done. have to work through service by service and issue by issue. don’t think get regions and districts – diff mechanisms for different services

Q: inevitable we get less homogenous, less equitable NHS England

DN: no,. opposite. when took NHS through High-Quality Care For All, with quality as organising principle, asked how will organisations know what really good looks like in stroke etc. myriad views. One thing set up, NICE to develop quality standards, done stroke, 150 to do. Those for 1sst time set out for commissioners, providers and public set out what really good services look like. Commissioning Board will set out what that means locally, and national framework contracts for providers. Clarity on what really good is, and how you deliver it open

Q: strategic planning, who will make key reconfiguration service (maternity or DGH shut) locally?

DN: people to set out expected outcomes will be commissioners – consortia will. providers then respond, and if meant changing configuration, would have to. Bu both account for change to health and wellbeing board and OSC, and so get clear responsibility. In designated services, can stil refer to SoS.

K Barron: back to issue of NCB’s role in commissioning locally. not done work in relation to dentistry – BDA want mechanism to strengthen ability to respond to local need and integrate with NHS services.  Sure NCB right and proper way, given dentistry’s last decade?

DN: that what set out. can define national and local – will be national contract, probably v diff to one we have, and local interpretation. can do through PCT or whatever, but benefit from NCB approach more likely to align

Dan Byles: many GP practices providers – COI and manage?

DN: yes, real issue one of transparency – benefit to expand quality and nature of primary care. Consortia commissioning needs transparency, how much paying, what quality standards, how can other orgs compete for work?

Q: on health inequalities – might proposals contribute to less equitable access to care, and evidence this will increase access?

DN: firstly, resources allocated to consortia on formula around access to care. secondly, identification of set of national standards important mechanism to take service forward. currently up to individual organisations to decide services. to get v clear evidence base of NICE standards, and mechanism to hold consortia, seems more likely than less to deliver

Q: so no evidence. no requirement for GP consortia in extant PCT boundaries to communicate together how this would pan out if come to diff decisions on services want to provide?

DN: consortia can’t just pluck priorities out of lair. legislations set out based on JSNA set out.

Jim Hood: out of time