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Productivity “falling across NHS”

20 December 2010

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The NHS needs to increase productivity to hit government targets on “efficiency savings”, health experts have warned.

Over the last 10 years, overall productivity has fallen by around 0.2% each year, and by 1.4% a year in hospitals, according to the Office for National Statistics (ONS).

Experts warn that the health service will need to boost productivity by between 4% and 6% each year to save the government’s target of between £15bn and £20bn in the next four years.

The report pointed to “risks to the delivery” of the plan and said hospitals, from which 40% of the savings are due, “have not focused sufficiently on driving productivity”.

With primary care trusts (PCTs) and strategic health authorities (SHAs) now being scrapped under the government’s white paper, it is likely they will suffer further distraction.

The report said: “There is a risk that strategic health authorities and primary care trusts, which are responsible for driving the delivery of the efficiency savings, will be distracted by their planned closure by March 2013.”

The study also pointed to staff pay as an issue, saying: “NHS pay contracts implemented nationally since 2003 have increased hospital costs and are not always used effectively to drive productivity.”

It added: “Other departmental initiatives to improve productivity, based on sharing innovation and good practice, have yet to be fully evaluated and remain insufficiently used within and across hospitals.”

Copyright © Press Association 2010