On the day briefings test

This chapter examines 

he starting point for any future efficiency challenge. It describes whether trust leaders believe there is waste in the system, and how confident they are that they can maintain or accelerate their current performance on efficiency. It also describes the main current measures for reporting efficiency – CIPs and implied provider productivity. It explores the rise in non-recurrent savings, and the difference between efficiencies that release cash and those that do not. It also briefly reviews the current NHS provider sector efficiency approach.

Trust leaders’ confidence in realising efficiencies

Trusts acknowledge that there is waste in the NHS (figure 1) but they are strikingly lacking in confidence (figure 2) that they can eliminate it or continue to tackle it at the rate delivered to date.

Our survey suggests the reasons for this potential paradox are that trust leaders believe:

• there is no such thing as a system without waste and the NHS already compares favourably with other systems internationally
• the most easily realisable savings have largely been made and continuing to identify further efficiency gains is becoming increasingly difficult
• the current degree of day-to-day operational pressure in trusts is limiting management bandwidth for other initiatives, including realising efficiency sav

Demonstrates that trust leaders

can still see waste in the NHS – however the comments attached to this part of the survey show that they also believe the NHS compares well with other systems internationally. This is consistent with a 2017 study published by the Institute for Fiscal Studies which found that the NHS performed well on length of stay, administration spend and drugs costs (Institute for Fiscal Studies, 2018).

Nearly three quarters of trust leaders surveyed agreed or strongly agreed that the NHS wastes too much money through inefficiency, while around half agreed or strongly agreed that their own trust is too inefficient. The fact that more respondents acknowledged waste in the NHS overall than in their own organisation suggests that trusts believe that reforming local system working now represents a greater opportunity for efficiency gains than cost reductions or productivity gains within a single organisation. This is explored in more detail in chapters 2, 3 and 4.

“I think the inefficiency is strongly linked to capacity and any business would be inefficient if it is running at over 100% occupancy so efficiencies cannot be addressed without addressing urgent and emergency care.”

Finance director, acute trust

 

 

However, figure two demonstrates that 61% of respondents were 'not confident' or 'not at all confident' that their trust can increase its rate of efficiency savings in the next five years.

 

Only 15% are 'confident' that their trust will enter the next financial year in a better position than it began this year – 48% were 'not confident'. Meanwhile, 59% 'disagree' or 'strongly disagree' that they have delivered efficiency savings at a rate they can safely continue. Our survey also found that almost two thirds were 'not confident' or 'not at all confident' that their trust will be set a reasonable efficiency target in the next five years.