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25
May

£1 billion can be saved says new Carter report


Lord Carter’s long awaited review into unwarranted variations in mental health and community services has been published and claims to find potential savings of nearly £1 billion that could be made in efficiencies by 2020/21.

 

The report identifies four important areas where it says operational improvement must be made. These are deployment of human resources, use of technology, contract specification and delivery. This last involves NHS Improvement and NHS England and Carter states that the proposed new regional structure for these two organisations must be implemented “as pace” to help providers to “up their game.”

 

In many ways this new efficiency review repeats the themes of Lord Carter’s original 2016 review into the acute sector and produces similar conclusions. 

 

Non-clinical resources account for about 30% of mental health and community Trust spend and tends to benchmark higher than the acute sector.

 

Estates & Facilities

At £1.3 billion, Estates and Facilities represents the largest area of non-clinical spend in the sector. Although the review acknowledges that some variation is warranted, Carter points to signification variation in the running costs per square metre - from about £30 to over £230 - and in the use of space. 

 

The review states there is scope for Trusts to rationalise their estate. Trusts that have already started this process have taken steps such as investing in new hubs and implementing mobile working. Others are looking at reducing the number of smaller sites they have.

 

However, there are challenges in vacating under-used leased buildings and Trusts may face financial penalties if they vacate a leased property and another tenant cannot be found within a given time. This acts as a disincentive. As most of these sites are leased from NHS Property Services and Community Health Partnerships, Carter recommends these arrangements should be reviewed to help support a more efficient estates model. 

 

According to ERIC, across the mental and community health sectors, on average 3.7% of space is empty and a further 2.2% is under-used. However, the review also acknowledges that ERIC is currently “limited” in its ability to support this sector to identify improvement opportunities. This is mainly because collections prior to 2018/19 only collect data on sites above 200m2 in total area, which excludes 36% of sites. From 2018/19 the collection will apply to sites above 150m2 in total area.

 

Carter also touches on the problems experienced by Trusts filling vacancies in E&F and the limited succession planning for leadership positions. NHS Improvement is working to deliver opportunities for training and development of the E&F workforce and the development of new roles and career paths. HEFMA also has its own workstream around leadership and development (see the coaching and mentoring section of this website).

 

Procurement

Significant unwarranted variations were found in the prices paid for the same product and Trusts are not leveraging their buying power or collaborating at scale to secure the best price. The review says Trusts should use the Purchase Price Index and Benchmarking tool to evaluated prices paid for products.

 

The review has analysed the top 25 categories of spend for mental health and community Trusts. Business fees – including administrative and subscription-based fees, such as courier services, room hire, consulting services and audio visual services – represents by far the biggest category and the review finds that Trusts could save 35% of this spend if procured at the minimum NHS price.

 

Corporate services

Corporate services tend to run at a higher level than in the acute sector, largely due to the smaller scale of operations. Carter recommends there are opportunities for greater collaboration between Trusts, sharing corporate services provision across neighbouring organisations, including sustainability and transformation partnerships (STPs).

 

The Model Hospital

Lord Carter recommends the Model Hospital is expanded to include metrics for analysing productivity and efficiency across mental health and community Trusts. 

 

Click here to download the full report: ‘NHS operational productivity: unwarranted variations, Mental health services, Community health services’.

 

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