We move to item 2. I invite the Auditor General for Scotland to brief the committee on his report "Implementing the NHS consultant contract in Scotland".
My report was published on 9 March. The new consultant contract was introduced in April 2004 as part of United Kingdom-wide pay reforms across the national heath service. The other reforms are the general medical services contract and agenda for change.
Thank you. Later, members will discuss how we should respond to the report, but at this point we can seek clarification or ask questions of the Auditor General.
It is disturbing that we have spent an extra £235 million, but the consultants are not working the amount of hours that was foreseen—they are still overrunning their times—and of those who responded to the survey, only 7 per cent say that there has been an improvement in patient care. That causes me concern.
Your first question relates to the relationship between the boards' estimate of the cost and the department's estimate. The first estimate was prepared by the department; there was no estimate by the boards. The boards did not have high-quality information about how consultants were deploying their time. They did not, therefore, have a good estimate of the costs of the consultant resource and activity at that time. The original estimate was prepared by the department; then, there were two other estimates. The second estimate was, initially, for two years. It underestimated the cost by almost £32 million as a result of the department's asking the boards to produce their first estimate. The third estimate, which was also for two years, underestimated the cost by £11 million as a result of the department's asking boards to return a monitoring form. We got convergence as the information got better about what consultants were doing.
The plan to monitor changes.
Yes. Barbara Hurst and Claire Sweeney are closer to what is happening in the boards in real time; therefore, I ask them to answer that question.
I will kick off and then hand over to Claire Sweeney. Initially, the department published a statement of what the benefits should be, which is appendix 5 in the report. It was fairly high level. In July 2005, the department wrote to boards, asking for more detail on all three of the pay modernisation agreements. Health boards are developing their own ways of monitoring the benefits and, at that time, our view was that if there had been a clearer picture up front about what benefits were expected, the situation could have been monitored from the outset. Monitoring is only now starting to be done. The early plans that the department got back from the boards are still not measurable against one another.
Boards will also work together locally to secure benefits from the various peer modernisation initiatives. There is, at present, no standard approach to measuring the benefits or the impact of the changes across the piece. That work will feed into the regular benefits realisation plans that the Health Department has requested from boards. Work is on-going to make those plans more robust.
Why can you not compare benefits across boards?
Because the benefits realisation plans are made from the bottom up, the boards are using different measures to measure the benefits. With a national contract, one would expect some national benefits to have been identified up front. That is what we are trying to push for through the report, which will enable us to examine what is going on across Scotland.
There is a short section in the report that might help the committee. In paragraph 45 on page 16, we talk about boards taking different approaches to implementation of the contract. Some boards concentrated mainly on sustaining existing activity levels, but others tended to be driven by the need to minimise costs. Understandably, it appears that boards that faced the most difficult financial constraints gave priority to keeping the costs down, and accepted that there might be some risk to the activity levels that they were delivering as the contract was introduced. Boards on which the pressures were less severe were able to accept higher costs to avoid the risk of activity levels coming down. We must, therefore, recognise the different local circumstances of boards, which explain why boards took different approaches to embedding the contract in their ways of working. That leads to the risk, which is identified in the report, that it might be difficult to monitor consistently what benefits are realised.
The contract was launched without clear goals or targets. What was the contract meant to do and what specific improvements was it meant to produce?
In exhibit 1 of the small summary, we have attempted to capture as best we can what was the expected impact of the new contract. We list the expected benefits, the impact on patients and the impact on consultants to date. We could go through that in detail if that would be helpful to the committee. You will find in that exhibit the level of narrative that was applied to the expected benefits when the contract was introduced. It is important to bear in mind that it is a UK-wide contract and that, therefore, the amount of control that was open to the Scottish Executive Health Department was limited. Negotiations were taking place at UK level.
I am trying to link expectations to the reality in health boards. If specific performance measures to ensure that boards planned for those goals and targets were not in place at the beginning, what assurances are there that those specific performance measures can now be sensibly introduced?
That question would perhaps be most appropriately addressed to the Health Department. As I hope we have emphasised, we are conscious that this is a moving picture. A lot of activity is going on to embed the new contract, which is really quite complex.
As you said—and as you say in the report—the contract was part of a UK-wide move to reform pay across the NHS, and the agreement that was reached for Scotland was based on a UK-agreed framework. I want to ask a few questions about the way in which NHS Scotland was engaged in the process. My first question is factual. The report notes that
We might struggle to give you a wholly satisfactory answer to that because the focus of the study was implementation of the contract in Scotland. My remit self-evidently does not extend to the rest of the UK and does not go back beyond devolution. The early days are not really covered in the report; however, I am sure that the team will have some information to help you.
We do not have much more than that. We did not look at the negotiation process because it was done on a UK basis. We started our project at the point where the detail was being fleshed out in Scotland on the back of some of those UK agreements. There was certainly some flexibility around some of the conditions of the contract; for example, we know that Wales went more down the recruitment-and-retention-premium route than Scotland or England has done. Can we try to provide more detail for you? Do you want to see the framework agreement?
The framework agreement was agreed in 2002; two years were spent on agreeing the draft framework, and that clearly underpins what was the eventual outcome of the process. I would certainly be interested to see that.
I can come back briefly on a couple of issues. On back pay, I do not think that Scotland had much choice about whether it paid that year's back pay because it was agreed in, and strongly led from, England.
My final question fast-forwards us to the implementation process. Given that this is part of a UK contract and pay framework, can you advise us of any information that is available to you, or of any mechanisms that Audit Scotland has in place, to compare how the costs, the impacts and the implementation vary—or do not vary, as the case may be—in different parts of the UK?
I can tell you that our sister organisations in England—the National Audit Office and the Audit Commission—are committed to examining the consultant contract. I know that they are interested in the work that we have done in Scotland, so there must be a good prospect that we will, in the fullness of time, get some information that will allow comparisons to be made.
The questions that I was going to ask have been covered.
I should probably draw the committee's attention to my entry in the register of interests that says that I am still a member of the British Medical Association, which has more or less said, "We told you so". It felt that there was a lack of appreciation of what consultants actually do when it came to writing it down and their being paid for it on a different basis. Consultants were previously paid in an holistic and professional way; they took on the job and did whatever the job threw at them in whatever hours they could find to do it in. That system is clearly open to abuse as well as to good practice. I can see why we wanted to move away from that. Was the BMA right? I know that you did not examine the negotiation stage, but was there a feeling that the profession had said, "If you actually pay us for all of the hours that we work, it will cost you," and that those in charge had said, "No, you cannot possibly be working that much"?
The general pattern that comes through from the survey of consultants indicates that, on average, consultants have been and are working more than the hours that are provided for in the contract. Some 93 per cent of those who replied to our survey said that they were working more than 48 hours a week and had not signed a waiver. Clearly, that raises an issue about overtime working in the NHS that needs to be taken into account when the consultant contract is embedded more firmly. About two thirds of those who responded said that their hours had not reduced.
The basic contract is for 40 hours, and the extra programmed activities can take it up to 48 hours. On average, the full-time consultants who replied work just over 52 hours a week. We have been keeping an eye on what has been happening in England, so we can say that that level is common across the United Kingdom.
I wonder whether that might partly explain why we are not seeing evidence of increases in aggregate activity. The committee will recall that, in the performance overview that I brought to Parliament in December, we had a chart that showed activity data for emergency admissions, day cases and elective admissions. We are not seeing increased activity in those, although it is important to qualify that by saying that the contract does not cover elements such as out-patient clinics and the training and supervision of doctors. However, that leads to a concern that we do not yet have good measures of whether the injection of extra resources into the consultant contract will deliver more and better care. That question still cannot be answered.
The out-patient graph was interesting because it showed that there was, following implementation of the contract, a bigger trough than there had been previously. One could imagine that that was due to people doing less because they were busy working at their job plans. Following that trough, there was a bigger peak than there had been previously, which might have been to do with people catching up. It will be interesting to follow that over time. If the contract is working as it should, the peaks and troughs should even out.
That is a question for the Health Department rather than for us, although those factors must increase the pressure on boards. The modernising medical careers project offers the prospect of doctors in training being less available to work on wards, which will, I presume, have to be covered by others including consultants. At the same time, there will be expectations about the contribution that consultants make to training, which will place extra pressures on the system.
I thank the Auditor General and his staff for that briefing on the consultant contract. We will return to this issue in private, under agenda item 5.