Penningtons Manches’ clinical negligence team expresses concern at unnecessary costs of NHS reorganisation

Posted: 18/03/2014

In April 2013, a major reorganisation of the NHS took effect and saw the introduction of Clinical Commissioning Groups (CCGs) to replace the primary care trusts that had previously managed resourcing of local NHS services.

The intention was that the new structure would remove layers of management and streamline the commissioning of local NHS resources. Local practitioners would then have greater influence over what services were needed on the ground and could focus resources according to local need.

The impact of this overhaul has been wide-ranging, although it is still in its infancy and probably too early to evaluate fully how effective it has been. What is becoming clear is that it has been at significant cost and, if figures reported today are correct, that cost has been higher than needed.

In stripping out layers of management and administrative staff, the reorganisation led to the redundancy of more than 10,000 NHS staff, each receiving pay-outs averaging around £43,000 according to reported audit figures. In replies to Parliamentary questions tabled by the Opposition, it is reported that ministers have confirmed the NHS has re-hired almost 4,000 of the managerial staff whom it had made redundant. Some were re-employed within a matter of weeks and there is nothing to indicate that any redundancy payments have had to be repaid to the NHS.

Commenting on these reports, Andrew Clayton, associate in Penningtons Manches' clinical negligence team, said: "It was inevitable that there would be a very significant cost of implementing such wholesale change to the commissioning of NHS services. While the Government is said to have accepted that the contracts that allowed staff to re-join the NHS only a month after their redundancy were ‘unacceptably lax’, the resulting cost to the NHS and the wider economy with absolutely no benefit is staggering. This is particularly concerning when other areas of the NHS are clamouring for funding to try to address wide-ranging resourcing problems, including well publicised shortages of nurses and A&E doctors and lack of community care resources. The figures confirm the NHS has achieved a significant reduction in administrative staff, but the number whom the NHS has re-employed raises concerns that this restructuring was not thoroughly evaluated to determine the resource it needed. Only time will tell whether and how this may ultimately impact on clinical care."

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