The National Audit Office (NAO) cautions against losing essential skills and capacity as ICBs (Integrated Care Boards) attempt to meet NHS England’s (NHSE) demands to cut running costs.
A new NAO report finds that ICBs have restructured, made redundancies and developed new operating models at pace to meet NHSE’s savings targets, but it is not clear yet if they have retained the necessary skills and capacity to deliver effective strategic commissioning.
In response to a 2024 review, NHSE announced plans to restructure ICBs to focus on commissioning services whilst reducing duplication and spending. NHSE instructed ICBs to reduce running costs by 43% from around £2bn (£2.3bn in 2024/25 and £2.2bn in 2025/26) to achieve a saving of £908m a year. It estimates that ICB running costs for 2026/27 will be around £1.4bn, £200m above target.
Some ICBs have chosen to form clusters or merge to cover larger populations and pursue efficiencies. This saw the number of ICBs fall from 42 to 25 by April 2026. NAO reports that most ICBs it surveyed had also developed new operating models to reduce costs and focus more clearly on their role as strategic commissioners.
Workforce implications
A significant contribution to achieving the cost reduction required will come from reducing ICB workforces – by an estimated 8,000 fte, around one third of total ICB staff. NAO finds that the redundancies and restructuring have affected staff morale as well as relationships with local partners and created risks to organisational capacity. It cautions there are early signs of issues in some areas that might leave local authorities with gaps to fill, placing greater onus on health and social care providers to manage frictions in the health system. A key challenge, it says, will be making significant workforce reductions while retaining the skills and capacity needed to deliver their new strategic commissioning role and the ambitions of the ten-year health plan.
Recommendations
To help ensure the reforms deliver sustainable savings while maintaining the skills and capacity ICBs need, the NAO recommends that NHSE and the Department of Health and Social Care should prioritise three actions:
• Clearly set out the future roles and responsibilities of ICBs alongside robust arrangements for measuring performance, capability and the success of the reforms
• Ensure workforce reductions deliver lasting savings, while protecting essential skills and capacity and avoiding unnecessary redundancy costs if staff return elsewhere within the NHS
• Help ICBs share good practice and maintain strong relationships with local partners, ensuring reforms across health, local government and other public services are joined up.
