The role of the private sector during the pandemicBMJ 2023; 380 doi: https://doi.org/10.1136/bmj.p444 (Published 28 February 2023) Cite this as: BMJ 2023;380:p444
The NHS paid private hospitals £2bn in the pandemic: did taxpayers get value for money?
The BMJ’s investigation into the private sector being underused during the first year of the covid-19 pandemic—despite an expensive arrangement that private hospitals would help the NHS1—is yet more evidence that the government, the Department of Health and Social Care, and the NHS central machinery have great difficulty in contracting successfully for large complex packages of services and managing relationships with suppliers.
This has happened many times before, including during the pandemic. The Test and Trace system’s deal with Deloitte paid senior staff £6000 a day,2 yet largely failed to meet its targets.3 Possibly worse was the waste of at least £10bn on personal protective equipment that was incorrectly procured through incompetence.4
Examples from well before the pandemic have similar serious shortcomings: private finance initiative deals that led the National Audit Office (NAO) to conclude that the government needed to be a more intelligent customer and the National Programme for IT, which spent £10bn before being dismantled in 2011.5 Although the IT programme did deliver some elements such as NHS email, the data spine,6 and picture and archiving communication systems,7 it was a broadly unsuccessful initiative, and the NAO concluded that “the original vision for the National Programme for IT in the NHS will not be realised. The NHS is now getting far fewer systems than planned, despite the department paying contractors almost the same amount of money.”89
Why does this happen?
The expertise to develop and run complex contracts is specialist and expensive. The growth of “generalism” and a reluctance to pay for in-house expertise in the civil service creates an asymmetry of expertise and experience. The extent to which this can be rectified by buying in external consultants is limited.
In the case of the contract with the independent sector for extra healthcare capacity during the pandemic, these problems, combined with a need to act extremely quickly, created serious potential for error. That this contract was apparently a “first of its kind,” according to NHS England, increased the risk still further.1
The top-down nature of the solutions developed is another factor contributing to these failures, particularly in the development of the National Programme for IT and the pandemic Test and Trace system. The intentions of the national organisation are often not communicated effectively to those responsible for local implementation, and The BMJ’s investigation indicates a lack of clarity about how local systems were supposed to respond.1
Central action also means that important local factors cannot be taken into account—and measures that might seem sensible to the centre might not translate well to local circumstances. The block booking of beds in a range of facilities with very different capabilities required an understanding of local requirements, which could never be available centrally in a large system such as the NHS, and so set up the approach to fail.
The decision to buy capacity (such as extra beds) rather than to pay for activity (such as extra procedures), perhaps with a guaranteed minimum level of capacity, seems odd. Yet it is perhaps explained by another problem—ministers’ actions are often driven by the need to be seen to be doing something, thus reducing the risk of being criticised for failing to act.9
Later in the pandemic when some of these matters had become evident, Amanda Pritchard, chief executive officer of NHS England, asked Sajid Javid, then the secretary of state for health and social care, for his directions in writing about contracting with the independent sector—while pointing out that private hospitals were not typically used for acute medical patients, such as those with covid-19.10 This was as close as a public official can come to publicly disagreeing with a minister.
Some of the problems might also lie with local relationships. The BMJ investigation contains a range of responses from the private sector blaming local NHS managers for the serious underuse of private capacity during the pandemic, including one suggestion that “the NHS couldn’t organise a piss up in a brewery”—all of which clearly point to poor relationships.1 The two sides compete for both patients and consultants’ time, often leading to mutually low trust, and an adversarial approach to problems not conducive to finding shared solutions.
The BMJ’s investigation contains very important lessons about decision making, expertise in the civil service, the management of relationships, contracting, and the role of ministers. Until some of these lessons are learnt, the NHS is condemned perpetually to repeat its past mistakes, to the great detriment of patients, clinicians, and public health.
Competing interests: None declared.
Provenance: Commissioned, not externally peer reviewed.