Management Madness in the NHS

This government's failure to improve public services is perhaps most obvious in its many bungling attempts to reform our national health service. When looking for evidence of our leaders' catastrophic mismanagement of the NHS, you're spoiled for choices. A recent report comparing survival rates for conditions like cancer and strokes estimated that if we could just reach the level of comparable European countries, over 17,000 deaths a year, almost fifty every single day of the year, could be avoided. Then there are about 6,000 people a year dying from hospital-acquired infections - the number would be just about 120 if we matched the performance of some other advanced European countries. On its website, the NHS admits that around 34,000 people die unnecessarily in our hospitals each year and an additional 25,000 are unnecessarily disabled. But whatever your choice of figures, the only conclusion you can reach is that although this government has more than doubled healthcare spending from about £45 billion to £105 billion a year, death rates in Britain are still massively above where they should be.

One striking feature of this government's approach to reforming the NHS has been the extraordinary amounts of money that have been squandered on building a new managerial class, most of whom have absolutely no healthcare training. The number of managers and senior managers in the NHS has shot up from around 20,000 in 1997 to about 40,000 today. We now have 5,000 more managers than we have medical consultants (34,900). Just in the year 2008, when the recession had already started, the number of managers in the NHS went up by around ten per cent while the number of medical staff only increased by about two per cent. There are various reasons for this almost obscene spawning of bureaucrats.

One is the government's obsession with poorly-thought-through target-setting, meaningless reports, unnecessary form-filling and unproductive box-ticking. Another is that managers are often uncomfortable dealing with highly-trained medical staff, so they surround themselves with other managers and live in their own little world, all holding important meetings with each other where they can speak management gobbledegook and think up new and exciting initiatives. In most hospitals today you'll find directors of strategy, of communication, of planning and development, even marketing directors. Naturally, they all feel they need offices full of secretaries and subordinates busily writing reports and attending meetings and going to training on teamwork and all sorts of other superfluous rubbish that has nothing to do with improving the quality of care delivered by the NHS.

Not only have the numbers of managers shot up, so have their salaries compared to most frontline medical staff like nurses and midwives. The average salary of a NHS trust chief executive is now over £158,000 a year, more than double the 1997 level. Moreover, with this salary comes early retirement with a tax-free lump sum of up to £240,000 and an inflation-linked pension of over £70,000 a year. All the plethora of finance directors, marketing directors, strategy directors and communication directors will be getting similar enviably large pay and benefits packages. The increased cost to the NHS of these extra 20,000 managers is over £3 billion a year and they are a massive and unnecessary drain on NHS resources. If we could just get back to the level of management of 1997, the NHS would have an extra £10 million every single day to spend on medicines and patient care.

Yet while the managerial population is growing, the number of hospital beds the increasing army of managers have to manage has been falling - from about 250,000 in 1997 to less than 180,000 now. Where we once had 12.5 beds per manager, we now have 4.5. Just this statistic alone should make our government hang its head in shame. But quite the opposite is happening - the numbers of beds keeps on falling while the number of managers just keeps on growing. Then, of course, we should not forget the £600 million a year or so being spent by the NHS on management consultants, a cool £15,000 per manager, just to tell all these managers how to do the jobs we already pay them for doing. This situation is so farcical you almost couldn't make it up.

One area where the managerial explosion has been most shocking is in the ever-increasing number of healthcare regulators the government has given us. One of the few healthcare regulators that actually predates New Labour is the General Medical Council (GMC). It was founded in 1858. Its motto is the very fine-sounding 'protecting patients, guiding doctors'. As rates of unnecessary deaths in our hospitals have probably more than tripled over New Labour's time in power, so have the GMC's budget and the salaries of its employees - the GMC's costs shot up from just over £20 million in 1997 to £75 million by 2009. Yet the rapidly rising numbers of unnecessary deaths in our hospitals suggest it is not obvious that this eye-watering three hundred per cent increase in bureaucracy has benefited anyone apart from the employees of the GMC. The GMC's budget increases have been so staggering that even some doctors, who have to fund it through their registration fees, are questioning why this bureaucratic monster seems to be afflicted by such morbid obesity.

In 2001 the National Patients Safety Agency (NPSA) was established to: 'improve patient safety in the NHS' and by 2009 it had amassed 292 staff and an annual budget of almost £30 million. The NPSA has destroyed almost Amazonian amounts of trees producing presumably useful guides about anything they can think of. Unfortunately, after spending well over £100 million of our money on paperwork and their own comfort, they still have no real idea of the number of unnecessary deaths in hospitals each year. One independent study even suggested that the NPSA was only picking up about five per cent of incidents where avoidable harm was done to patients. The situation was so bad that in 2006 the Public Accounts Committee PAC) denounced the NPSA as being 'dysfunctional' and 'not value for money' because it had no idea how many patients were harmed as a result of medical errors. In spite of management changes following the PAC report, it is not obvious that things have got any better.

In 2002, the Nursing and Midwifery Council (NMC) was set up in order 'to protect the public by ensuring that nurses and midwives provide high standards of care'. Its motto is also inspiring: 'protecting the public through professional standards'. The NMC has been also been quite generous to itself. It has increased its budget from about £14.9 million to £34 million in the first seven years of its existence and it now employs about 220 staff, all paid for by our nurses' registration fees. Perhaps a little worrying for people in hospital is the fact that the NMC, which is responsible for ensuring we receive quality nursing, takes no disciplinary action against nurses in around ninety per cent of the complaints it receives - most are rejected as 'trivial'.

In 2002 we were also fortunate to be given the NHS Confederation. It calls itself 'The voice of NHS Leadership' and its aim is to 'help members improve health and patient care'. Although this is not really a regulator as it focuses more on the management of rather than regulating the medical aspects of running the NHS, it still spends our money in order to supposedly improve our healthcare and has been a true leader in the way it has increased its own budget. This rose by a factor of five from a tiny £5.3 million in its first year of operation to a much more impressive £29 million by 2009. It too seems to be in the business of destroying innumerable forests to produce mountains of reports. Some could be useful such as Managing Excellence in the NHS and Bringing Leaders into the NHS. Some like Why We Need Fewer Hospital Beds might seem a little worrying to those of us who know that hospital over-crowding is one of the major causes of hospital-acquired infections.

In 2003 we got the Health Protection Agency (HPA) to look after our well-being. Its aim was 'to provide an integrated approach to protecting UK public health'. The HPA has certainly been effective at spending taxpayers' money. Its total costs increased by fifty per cent from £180 million in 2004 to £270 million by 2009 and the number of staff went up from 2,518 to 3,160. The HPA produces a vast amount of presumably valuable literature about almost any medical topic you could think of including lots of guidance about reducing hospital-acquired infections such as MRSA and C Diff. In the meantime, these infections have claimed over 20,000 British lives. The death toll would have been less than 400 had these victims been living in countries like Holland, Denmark or Sweden. In the same year, we also were given the Medicines and Healthcare Products Regulatory authority. It has eighty staff and an £80 million annual budget, yet EU regulations should mean that medicines tested and approved in one member state should be available throughout the whole EU without any need for further approvals.

The following year, 2004, was a bit of a bumper year for new healthcare regulators with no fewer than three being established. In January 2004, we were blessed by the appearance of Monitor. Its mission is: 'To operate a transparent and effective regulatory framework that incentivises NHS foundation trusts to be professionally managed and financially strong and capable of delivering innovative services that respond to patients and commissioners'. Its chairman earned over £215,000 in 2008-09 (almost £20,000 more than the Prime Minister) and it spends about £12.5 million of our money a year supposedly regulating NHS foundation trusts so they provide better healthcare to us. Yet recent events at the Mid-Staffordshire NHS Trust which was granted trust status in spite of the unnecessary deaths of possibly more than a thousand patients might make people wonder what Monitor is up to.

At the time of the Mid-Staffordshire scandal, the head of health at Unison commented: 'It seems unbelievable now that despite a history of clinical and staffing problems and failures at Mid Staffordshire, the trust was awarded foundation status in February last year. It is time Monitor the regulator was held to account'. Moreover, there are so many other examples of other hospitals being given trust status despite serious concerns about their standards of care that with Monitor we probably have a case-book example of regulatory capture as the regulator is possibly being driven by political pressure to increase the number of NHS trusts rather than any real concern for patient care. To quote the head of health at Unison again: 'Hospitals need to get out of the cycle of trying to win foundation status and the regulator needs to be more rigorous in granting that status to failing trusts'.

2004 also gave us the Healthcare Commission (HC). The HC's motto is 'Inspecting, improving, informing' and it has an inspiring mission statement for its five hundred plus staff: 'The Healthcare Commission is committed to driving improvement in the quality of both the NHS and independent healthcare services and to making sure that patients are at the centre of everything we do'. The HC has been slightly more prudent than the HPA - it only increased its spending of our money by about thirty per cent between 2004 and 2009 to a mere £70 million. One of the key focuses of the HC's work since its inception has been getting to grips with hospital-acquired infections, whose incidence and mortality rates have hugely and relentlessly increased since the HC started producing documents about how to go about tackling them. MRSA and C Diff have now started to go down, but they only constitute a small proportion of the hospital-acquired infections which ravage the NHS and so we can expect many more excellent reports and guides to be produced at our expense.

Then in the same year, perhaps to score a hat trick, the government dreamt up the Commission for Social Care Inspection which by 2008 grew to 2,335 staff and a budget of £164 million. This new organisation only lasted about four years as it was rolled into the Care Quality Commission by 2009.

There may have been a couple more new healthcare regulators since 2004, it's difficult to keep track. But now the government has set up the mother of all healthcare regulators - the Care Quality Commission. It will combine several existing regulators such as the Healthcare Commission, the Mental Health Act Commission and the Commission for Social Care Inspection. Its aim is: 'To make sure better care is provided for everyone, whether that's in hospital, in care homes, in people's own homes, or elsewhere'. Had any of the other bureaucracies done their job properly, this new regulator would not have been necessary. Moreover there is only one certainty with today's new generation of expensive, self-serving, regulatory-captured regulators - this new body will be as ludicrously expensive and as laughably ineffectual as all the others.

In its 1997 election manifesto New Labour promised to reduce administrative costs in the NHS, 'The key is to root out unnecessary administrative cost and to spend money on the right things - frontline care'. As we now pay over £450 million a year more for regulators than we did twelve years ago, it is far from obvious that the government has delivered on its pre-election promise.

David Craig is the author of "Fleeced! How we've been betrayed by politicians, bureaucrats and bankers" (Constable 2009), "The Great European Rip-Off" (Random House 2009) and "Squandered: How Gordon Brown is wasting over one trillion pounds of our money" (Constable 2008). You can find out more about his books or contact him at snouts-in-the-trough.com snouts-in-the-trough.com.