Evidence submitted by the Overview and
Scrutiny Committee on Health, Kensington and Chelsea (Def 14)
I am writing as Chairman of the Overview and
Scrutiny Committee on Health in the Royal Borough of Kensington
and Chelsea in response to your request for information on the
current NHS deficits. I will be addressing more specifically the
serious consequences which may arise from the likely attempts
by the Department of Health to correct the financial problems
of our local Primary Care Trust.
Many people must be astonished that after a
period of unparalleled increase in funds into the NHS we are now
faced with deficits on such a scale. Record funds seem to have
led in some areas to record cuts and closures. All of this points
directly to poor management. Clearly this has to be addressed
and the present position is unacceptable. My purpose in writing
is to express my fear that the solutions demanded today will not
address the key issues which created the problems in the first
place and will not help to create the sustaining and effective
health service which we all seek.
The Kensington and Chelsea Primary Care Trust
(KCPCT) is estimating an accumulated deficit at the end of March
2006 of around £28 million and their budget for the year
2006-07 indicated a further deficit of £9.4 million after
a range of cuts. (KCPCT Board paper 9 May 2006) The Trust was
aiming to come back into balance on a monthly basis by September
2007.
The new management of KCPCT is facing an uphill
battle to correct the problems which it inherited when it took
office in the second half of last year and this letter should
not be seen as a personal attack on them. They did not create
the problem, which has been further exacerbated by the 3% "top
slicing" from its budget, the logic of which has never been
explained to us.
The effect of being compelled to have no deficit
for 2006-07 will have serious consequences and is the antithesis
of good management practice. At the time of writing the full list
of cuts which the PCT will seek to impose are not known but would
be available for discussion at the hearings of the Committee later.
It is said that the NHS is moving from the discipline
of targets to the discipline of the market. The effect of sudden
and arbitrary cuts will compel the diversion of expenditures elsewhere
and by reducing choice be directly contrary to what the NHS says
it is seeking.
By demanding a very tight financial timetable
KCPCT will be forced into a series of knee jerk painful financial
decisions, which will be decided with little reference to the
long term needs of the community. Ease of enforcement could be
the determinant rather than community need. This is the very antithesis
of good management and the supposed philosophy of the market in
the delivery of services to the public.
Well run NHS Trusts which are in balance could
be penalised by the failings of this PCT. Certain cross border
Trusts may find that they can provide services to the residents
of one borough but not to those who live across the border.
One possibility for KCPCT may be to concentrate
on the provision of statutory services, although many of the so
called "discretionary" services are as important in
some localities as the statutory ones. Indeed the Drug Action
Team in this Borough, which faces possible cuts, has been encouraged
by the Department of Health itself as necessary for the well being
of the community.
Long established partnerships carefully built
up over the years with local authorities and voluntary organisations
could be destroyed, as well as the credibility of the NHS.
At a time of financial crisis, as now in this
Borough, what is needed is calm and considered analysis of what
went wrong and a financial recovery programme which establishes
a regime that will not repeat the failings of the past and which
reflects the genuine needs of the community. Demanding that KCPCT
has no deficit in the year to end March 2007, while current plans
of the PCT are for breaking even in September 2007 is a slash
and burn approach to management which should have no place in
today's world. Services destroyed today for short-term considerations
cannot be switched on again in 12-18 months time, when the position
has stabilised. They could be lost for a long time, possibly forever.
The nonsense of this short term approach is
more apparent when the PCT moves to financial stability, perhaps
even surplus. This is no way to provide a sustaining service designed
to meet the long term health needs of the country.
There is an underlying problem of weak management
in parts of the NHS, particularly at the centre, but short term
panic cuts, arbitrary by their very nature, will not solve this.
The painful, and costly, solution must be to
take time to rebuild management, analyse the problems (eg why
does KCPCT pay £1 million a year to the costs of running
Broadmoor when no KC resident is within the institution?) and
to create a new culture of seeking to control costs logically
and rationally. Money is not well used in the NHS but harsh decisions
taken today to balance the books this year, rather than by September
2007, will be destructive of good services for our community which
may well not become fully apparent for two/three years.
This letter has been written in general terms,
for the full details of the cuts being forced on KCPCT are not
known, but if the accounting dictats are to be met then I fear
the consequences could be severe.
I am however far more concerned at the Department
of Health's approach to a serious problem which will not address
the underlying issue, is contrary to good management practice
and which may well have adverse long term consequences. The "quick
fix" solution rarely works.
Cllr Christopher Buckmaster,
Chairman of the Overview and Scrutiny Committee for
Health, Kensington and Chelsea.
2 June 2006
| 
