Select Committee on Public Accounts Minutes of Evidence


Examination of Witnesses (Questions 120 - 139)

MONDAY 23 MARCH 1998

MR ALAN LANGLANDS, MR FRANK BURNS, DR JAMES READ AND MR DAVID BIRD.

  120.  So as far as you are concerned these payments that have been listed, the incompetence, the paying people off, were not evidence of failure to manage the finances properly, you are happy with that track record?

   (Dr Read)  I think the finances were managed carefully with the enormity of the projects that we were trying to manage.

  Mr Hope:  My time is up. Thank you very much.

Mr Clifton-Brown

  121.  Mr Langlands, good afternoon. According to your biography you are a very eminent man. You hold a Diploma of the Institute of Health Services Management and you are an Honourary Professor of the University of Warwick Business School. So you should have a reasonable grasp of how IT systems should be implemented. You were also appointed to the Department of Health as Deputy Chief Executive in 1993. Three years later on 8 May 1996 you appeared before this Committee and many of the questions that have been asked this afternoon were the same sorts of failings on the hospital information support systems. Did it not occur to you after that hearing on 8 May to go away and look at the implementation of these Read Codes and, if so, what have you personally done to ensure that they are being implemented properly and that public money is being spent wisely?

   (Mr Langlands)  Not as a direct result of the Committee hearing but as a result of the likelihood of significant change in the health service and the need to improve our use of information and IT in the health service in June 1997 we set up a major review of information management and technology. That review has been carried out by Mr Burns, who is on my right, who has been the driving force behind an excellent system that uses all the principles of Read Codes and security, the unique patient number, all the building blocks that we need for good information management technology in his trust at the Wirral Hospital. His advice has been given to me. We are working at the moment with ministers to consider how we take that forward and how we use it to promote the Government's policies that have been set out in the recent White Paper.

  122.  Do you recall in answer to the Chairman, answer 11, this was in answer to questions from the Chairman about the integrated computer systems, you said: "In the period between now and the year 2000 it will be increasingly difficult for hospitals to function without this system"?

   (Mr Langlands)  Yes.

  123.  Here we are in 1998 and you have already admitted in answer to Ms Eagle substantially this system is not working in any reasonable number of hospitals. If your answer was correct then how are we now going to progress towards 2000?

   (Mr Langlands)  We have to progress in a whole number of ways. There is no single bullet solution here. Providing health care to every individual in this country is a complicated business. Providing information management systems that support the way in which health care is provided that can be used properly and effectively by clinicians in their day-to-day work is a huge task, a task that every developed health system in the world is having to deal with at the moment.

  124.  That is the sort of answer you might have given on 8 May 1996.

   (Mr Langlands)  I think we have made considerable progress since then.

  125.  You have not been able to give a definitive answer this afternoon to show us how you have made progress since 1996. There has been a lot of waffle but we have not really heard anything positive about how you have made progress since 1996.

   (Mr Langlands)  I think we have made progress in developing Read Codes and I reject the notion that Version 3 does not work. I think we have made progress, and there is documentary evidence to support this, further progress in integrated clinical systems in different hospital settings. We have reached a very detailed agreement with the medical profession in this country about how we are going to handle our security and questions of patient confidentiality in these clinical systems. We have been managing the roll out of what is called the unique patient identifier which gives every member of the population a unique number for use in health records. Every other country in the world regards these as major achievements. These are the essential building blocks of good clinical systems that ultimately will improve patient care in this country and in that endeavour we have strong support from the clinical community, but we should not kid ourselves that these are simple matters.

  126.  Mr Langlands, you have given me a lot of long answers. I would be grateful if you would keep your answers fairly brief. I am going to ask you a series of questions on costs now. Can you tell me what the estimated annual savings from the Read codes systems have been over the last ten years?

   (Mr Langlands)  No.

  127.  Could you give us a note on that, please. Can you tell us what the accurate development costs have been[15]? I know you have given the figure of £19.8 million [16] in the Report, but is that figure accurate?

   (Mr Langlands)  I think it is £19.5 [17] in the Report, but I am not sure. That is an accurate figure. The figure that I have been using this afternoon in relation to Version 3 is just over £3.8 million. The sum in relation to medical staffing issues is £2.7 million, in relation to the professions supplementary to medicine, £138,000 and in relation to nurses, health visitors and mid-wives, £1 million, so it is just over £3.8.

  128.  In addition to that there is the money you have paid to Dr Read's company, Computer Aided Medical Systems Limited, is there not? Can you give us an idea since the purchase from him of the copyright of this system how much have you paid him for distribution?

   (Mr Langlands)  I cannot give it to you now but I would be happy to provide a note[18].

  129.  Can I give it to you? In answer to a Question from Roger Morgan MP on 18/12/97 it looks as though the total figure is about £13.8 million. So in addition to almost £20 million of developing the system you have paid his distribution company £13.8 million.

   (Mr Langlands)  I would need to check that figure and I would also need to be clear with you that some of these --

  130.  Let us ask Dr Read. Is that a correct figure?

   (Dr Read)  I have not got the figures, I am sorry.

  131.  Let me give you a breakdown of the figure. The figure for 1995/96 was £1.6 million. The figure 14for 1991 to 1996 was £7.4 million. It is likely that payments at this level will continue for the expiry of the CAMS contract in 1999 suggesting further payments of £4.8 million. If you total those together that is £13.8 million. Do you accept that that is the sort of figure that your company will be paid until the termination of the contract?

   (Dr Read)  I would have to check that, but it sounds not far wrong.

  132.  You must have some idea of how much money your company has been paid for the distribution of this system up to date and between now and the end of the contract in 1999. That seems a fairly fundamental figure.

   (Dr Read)  It is something like £1.5 million a year which is to cover the costs of CAMS for servicing its contract.

  133.  Either the answer given in the Parliamentary Question on the 18/12/97 was correct or it was not correct. What is the answer, Mr Langlands? I am quoting from the answer.

   (Mr Langlands)  I do not have the figure in front of me, but I certainly would stand by --

  134.  You would stand by the figures.

   (Mr Langlands)  -- the figures and I would be happy to provide the Committee with a note[19]. There are other costs to the Health Service. For example, GPs and others themselves, the users, pay a licence fee as well. I think rather than give you partial figures we will give you a comprehensive picture.

  135.  Can you give me an idea of the amount of clinicians' time involved in the development of Read 3 and what that cost would amount to?

   (Mr Langlands)  As far as I know it has not been quantified. It could only be quantified by measuring the time that the group of people in the 55 working groups spent at meetings, but, of course, a lot of the work would be done back in their own hospital setting. We could try and estimate that, but it is an extremely difficult thing to get at.

  136.  These 55 speciality groups have been working over a two- year period. Somebody who is reasonably knowledgable in these matters has estimated that it might have involved 200 hours of clinicians' time at a cost of £50 per hour. That would involve a total figure of some £20 million. Do you think that is in the right ballpark or not?

   (Mr Langlands)  I think I would like to check based on the actual experience of the people who ran the committees.

  137.  You can see we have got almost £20 million for developing it. We have got £13.2 million paid to Dr Read's company. We have got some £20 million-worth of clinicians' time involved in developing it. We are getting to some pretty massive figures. Could you give the Committee, Chairman, with your agreement, please, a detailed note of the total costs involved in purchasing, in developing and any other associated costs with the Read systems 2 and 3 to date so we can see how much money has been spent in total? Would that be possible?

   (Mr Langlands)  That would certainly be possible[20]. If I may, Chairman, suggest that alongside some of these costs we should try and identify as far as possible in monetary terms some of the benefits as well because I think we are in danger of looking only at one side of the equation.

  138.  I think that would be very helpful. The Chairman has already referred to a Report commissioned by CCC in 1996 from a consultant called Mr David Markwell(?). He indicated that the costs might be nearly £100 million. This is getting to be a very significant sum indeed. I refer you to Ms Eagle's question: is it not now time to consider abandoning Read 3 altogether with these types of costs involved?

   (Mr Langlands)  It is time to carry out the independent evaluation and we have agreed to that. To abort this project which potentially is of huge importance to the NHS is something that I could not commit myself to. I think that would have to be a decision for ministers, especially given the strength of our clinical support. These may seem like huge sums of money, they are huge sums of money, but the Health Service is a very big organisation and we will have to spend, even to meet the priorities that have been set out by the government so far in this area, very substantial sums of money to modernize the computing and IT kit in the NHS. There is no doubt about that.

  139.  One has got to look at this thing on a pragmatic basis. This thing has been going since 1991. It has cost many tens of million. We do not know yet exactly how many but one estimate has put it as £100 million. If you come before this Committee in two years time where, realistically, do you think we will have got to? You have told us it may or may not be working in three acute hospitals, it may or may not be working in 11 or 12 other hospitals and it may or may not be working in 80 per cent of GP practices. How much more money has the taxpayer got to put in to a system that may or may not finally work?

   (Mr Langlands)  The system is only going to work if the clinical systems, the host systems that are needed to run this are put in place. There are a great many issues to be tackled in the NHS in updating clinical systems. There are a great many issues to be tackled in the NHS in advance of the year 2000 to deal with the problems of the millennium bug, and we are going to have to look very carefully over the next two or three years at the total expenditure in this area. It is only when the money has been devoted and when ministers have agreed what that total expenditure should be, and we have an agreed IMG strategy which ministers are looking at at the moment, that I will be able to compare the two and give you some indication of what progress we can make in a two-year period. The whole thing will depend in part on resources, in part on expertise and in part on the policy directions that ministers take.


15   Note: See Evidence, Appendix 1, pages 23-25 (PAC 264). Back

16   Note by C&AG: The figure in the report is actually £19 million. Back

17   Note by C&AG: The figure in the report is actually £19 million. Back

18   Note: See Evidence, Appendix 1, pages 23-25 (PAC 264). Back

19   Note: See Evidence, Appendix 1, pages 23-25 (PAC 264). Back

20   Note: See Evidence, Appendix 1, pages 23-25 (PAC 264). Back


 
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