Observations Health and Social Care Act

Counting the cost of England’s NHS reorganisation

BMJ 2014; 349 doi: https://doi.org/10.1136/bmj.g6340 (Published 22 October 2014) Cite this as: BMJ 2014;349:g6340
  1. Kieran Walshe, professor of health policy and management, Manchester Business School, University of Manchester
  1. kieran.walshe{at}mbs.ac.uk

Health secretary Jeremy Hunt’s claims of savings of £1bn or £1.5bn a year seem unlikely

Politicians sometimes find themselves having to defend the indefensible. Recently England’s health secretary, Jeremy Hunt, was put in the unenviable position of having to counter criticisms of his predecessor Andrew Lansley’s NHS reorganisation. The charges were made by unnamed sources in Downing Street, who allegedly called the reorganisation the worst mistake of the coalition government and “unintelligible gobbledygook.”1

In defending the NHS changes to the press, Hunt claimed that they had cost £1.5bn (€1.9bn; $2.4bn) to implement but had saved £1bn a year in NHS administrative costs.1 Asked for verification of these figures, the Department of Health press office pointed towards Hunt’s own words in Hansard on 22 July 2014,2 when he said that the expected final costs of the NHS overhaul brought in by the 2012 Health and Social Care Act were “no higher than £1.5 billion” and that “annual savings are still expected to be £1.5 billion from 2014-15.” It is not clear why Hunt this month reduced his claimed annual savings from £1.5bn to £1bn a year.

Let’s take these two claims in turn. The first, about the cost of the actual reorganisation, was carefully examined by the National Audit Office in 2013.3 The …

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