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Bleak economic outlook “doesn’t have to mean service cuts”

29 April 2009

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NHS PCT managers need not be gloomy about the future, despite the revenue budget cut of £2.3bn to the health service, according to an NHS leadership expert.

Commenting on the Budget 2009, NHS Institute for Innovation and Improvement chief executive Bernard Crump said: “In the aftermath of the budget announcement, NHS managers and staff could be forgiven for feeling gloomy about the future.”

Last week the Department of Health revealed its revenue budget for 2010–11 is to be adjusted down from £104.6bn to £102.3bn. “The message is clear,” said Mr Crump. “We must use our existing budget allocations wisely to prepare for tough times ahead.”

However, he added that it was important to remember “that this doesn’t necessarily have to mean service cuts and reducing headcount. The smartest NHS leaders understand that the key lies in fostering productivity, not in knee-jerk responses that choke innovation.”

Mr Crump said: “Our quarterly efficiency indicators have just been published, demonstrating hundreds of thousands of pounds have been saved by trusts increasing productivity.

“The data indicates that more than £3bn of productivity savings could be delivered if trusts everywhere can align themselves with the performance of the top 25%.”

He added: “Even more encouragingly, our research has proved that better care and productivity go hand in hand. Putting systems and processes in place to improve quality has a direct positive impact on efficiency.

“Let’s not underestimate the scale of the challenges ahead, but forward-thinking NHS organisations shouldn’t fear a tough economic climate. They understand the importance of implementing learning from across the UK, making it work within the local context and scrupulously tracking progress.

“And with such tough times to weather, it’s never been more important to find ways to nurture the staff morale, motivation and teamwork that can be any trust’s most valuable asset.”

NHS Institute