Public Audit and Post-legislative Scrutiny Committee
Meeting date: Thursday, November 3, 2016
Agenda: Decision on Taking Business in Private, Section 23 Report, Section 22 Reports
Section 23 Report
“NHS in Scotland 2016”
Item 2 is an evidence-taking session on the Auditor General for Scotland’s report “NHS in Scotland 2016”. I welcome to the meeting Caroline Gardner, the Auditor General for Scotland; Angela Canning, assistant director at Audit Scotland; Carol Calder, senior manager at Audit Scotland; and Jillian Matthew, audit manager at Audit Scotland. I invite the Auditor General to make her opening statement.
Today, I bring to the committee my annual overview report on the national health service in Scotland. It examines the performance of NHS boards during 2015-16 and comments on the challenges and pressures that face the NHS. It also looks ahead to assess what progress the Government is making towards delivering public service reform, including its ambition for everyone to live longer, healthier lives at home or in a homely setting by 2020.
Over the past decade, there have been real improvements in the way that health services are delivered: the time that patients wait for hospital treatment has reduced; treatment is safer; and hospital-related infections have dropped. Overall, people are living longer and are now more likely to survive conditions such as heart disease. Those improvements are testament to the hard-working staff of the NHS, who provide a vital service for all of us in Scotland. However, the health of Scotland’s population is relatively poor compared to that of other developed countries, and significant health inequalities still exist.
I have highlighted in previous reports the challenges that NHS boards face. They find it increasingly difficult to achieve financial balance and many used short-term measures to break even in 2015-16. The percentage of non-recurring savings has increased and, for the current year, boards are setting higher savings targets—the average is 4.8 per cent. The total planned savings are £492 million in 2016-17, which is 65 per cent higher than in 2015-16. That will put considerable pressure on the NHS this year, and there is a significant risk that some boards will not be able to remain within their budgets.
Overall, NHS spending is not keeping pace with the growing and ageing population, increasing demand and rising costs. NHS funding has increased each year since 2008-09, but the small real-terms increases of less than 1 per cent over that period have been below the general inflation rate and well below the higher health inflation rate, which was estimated at 3 per cent in 2016-17.
The committee might remember that we analysed the increasing demand for health and social care services in our report “Changing models of health and social care”. In the report that is before us, we highlight a range of cost pressures, including in relation to rising drug and staff costs, the achievement of national waiting times and new technologies. It is clear that the NHS cannot continue to provide services in the same way within the resources available. The Government has had a policy on shifting the balance of care for more than a decade and has published several strategies for reducing the use of hospitals and supporting more people at home, but most spending is still on hospitals and other institution-based care. Some progress is being made in shifting to new models of care, but it is not happening fast enough to meet the growing need.
My report sets out a number of recommendations to increase the pace of change, including having a clear plan with measures or milestones to allow progress to be assessed. There also needs to be financial modelling and a funding plan for the implementation of the strategy; a clear workforce plan to ensure that there are the right staff with the right skills for new ways of working; and continuing engagement with the public about the future of health services. The Cabinet Secretary for Health and Sport has accepted our recommendations and has committed to publishing by the end of the year a delivery plan that will bring together the various strands of reform that are under way, and I welcome that commitment.
Convener, my colleagues and I are happy to answer the committee’s questions.
Thank you. The first question is from Alison Harris.
Good morning. I have questions in relation to the recruitment and training of staff. My major concern is that without trainees going into specialist trainee posts, there are unfilled vacancies, as the report states, in old-age psychiatry and clinical oncology, which will be a major problem going forward—for example, as the population gets older. Most junior doctors seem to do their two years to become registered with the General Medical Council but are not taking the next step of going into specialties. Has Audit Scotland done any work to see why that they are not taking up those posts? What is causing that drop-off?
Those are very timely questions. The 2016 report pulls together evidence from the audit of each of the health boards, particularly the 14 territorial health boards, during 2015-16. The previous couple of reports have highlighted pressures on the NHS workforce. We are about to start a new performance audit that will look specifically at those questions and drill down into the high-level findings in the 2016 report.
Right. That is certainly something that needs to be drilled down into. We need to know why junior doctors are not going on to take up specialist training posts. I look forward to seeing that report.
Page 12 of the report refers to balancing budgets. Paragraph 18 shows that boards seem to have done a wee bit of creative accounting in order to balance their budgets, which concerns me. It seems that the more creative boards are in that respect, the better they can balance their budgets, and so they think that they are okay. Do you have any thoughts on that?
You are right. As accountants, we look for the areas where there is a risk that people are, to a greater or lesser extent, flexing the figures to hit a target this year, which very often means simply pushing a problem into next year. We refer in the report to the specific example of NHS Ayrshire and Arran making a pre-payment for public holidays, which the auditor concluded was simply not acceptable. Ayrshire and Arran restated its figures and increased the pressure on achieving its break-even position. We absolutely rely on the auditors whom I appoint to each of the health boards to ensure that proper accounting practice is being used. Given the attention that is focused on both the revenue limit and the capital resource limit, the actions and transactions that boards undertake to hit those measures are areas that the auditors pay particular attention to, as you would expect.
As is often the case with Audit Scotland reports, this one gives mixed information. It highlights the challenging financial situation that the whole public sector is facing, but I am pleased to see that it also contains a lot of positive stuff about improvements in overall health, life expectancy, patient safety and survival rates for certain conditions, and a reduction in delayed discharges. Those are all positive things, although that does not take away from the fact that there is a great deal of pressure in the sector.
I want to focus on one or two points. At paragraph 28 on page 15, the report states:
“The ... conclusion was that adequate accounting records had not been kept in relation to elements of property, plant and equipment assets.”
That is pretty basic stuff. Has that situation been rectified?
I will ask Jillian Matthew to come in on the detail, but it is fair to say that the issue that we described is now relatively unusual. Most NHS boards have decent records of their assets and manage them well, although—as you highlighted—there was a particular instance in Shetland this year.
The issue in Shetland was that the board had recorded assets that had been purchased but had not kept adequate records on disposal or sale of assets. The assets that were examined were quite old, and the board had assumed that they had been sold or disposed of, but it did not have the records, and the information had not been kept up to date on the asset register. The auditors have worked closely with the board on that and improvements have been made, and they have been assured that it will not be a problem in the future.
I am looking at paragraphs 29, 30 and 31 on page 17. Would it be correct to say that there has been a small improvement in the NHS estate in the period that the report covers?
It is probably fair to say that, but—as you will see from reading those paragraphs—the situation is slightly more nuanced. The changes in each of the categories from “good condition” through to “unsatisfactory” move in different directions, so although there is a small improvement, a significant amount of the estate still requires significant investment to bring it up to an appropriate standard.
At paragraph 39 on page 19, the report states:
“Scotland, along with the rest of the UK, has one of the highest generic prescribing rates in the world.”
The prescription of generic drugs generally reduces costs, and yet—if I remember correctly—prescriptions make up approximately 12 per cent of NHS costs, which seems an awful lot. We are seeing year-on-year inflation-busting increases in the cost of drugs. Is the switch to generic prescribing actually having the impact that one would hope that it would have?
Over the long term, it has had a very significant impact. We have reported on general practitioner prescribing in its own right on at least two occasions over the past decade or so, and we have seen both significant increases in the generic prescribing rate and real savings as a result, to the extent that it looks as though the remaining savings that are available to be achieved are pretty small.
What has changed has been the conditions in the market. The supply of some of the unbranded generic drugs has been restricted for different reasons and the price has risen. Jillian Matthew might want to add a bit of detail to that.
To echo what Caroline Gardner said, a lot of savings have been made through the switch to generic prescribing, but a lot of issues have arisen over the past few years around the prescribing of drugs. The number of items that are prescribed is going up, which is linked to the ageing population; more drugs have been approved; and new and very expensive drugs for rare conditions have been developed, so boards are having to finance those.
There are many pressures from various sources that are causing the overall increase, and the Scottish Government predicts that that will continue for the foreseeable future, with an approximate increase of 5 to 10 per cent each year. That is a big pressure for boards at present.
The report also states in paragraph 39:
“Our 2013 report on GP prescribing found that most of the potential savings ... have already been made.”
I assume, therefore, that there is not a great deal to be got out of that now.
As I said, Scotland has made real advances in generic prescribing over the past decade, and we think that most of the savings have been achieved.
The challenge lies in the new drugs that are coming through; increasing levels of prescription, such as the prescription of statins, for some conditions; and very significant increases in the price of some drugs where the supply is restricted to one or two manufacturers, or a new supplier has bought the rights to manufacture them and has significantly increased the price. We have tried to set some of that out in the following couple of pages, which contain examples of drugs to which that challenge applies.09:15
I also noticed that a fairly high proportion of prescriptions are for over-the-counter drugs, which seems odd.
That is a policy matter that you should ask the Government about. There might be good clinical reasons for prescribing to a particular patient things such as ibuprofen, which is one of the drugs that we identify in the report, but the fact is that most of us can simply purchase over-the-counter drugs when we need them. There might be a particular preparation of the drug or, for some patients, it might be appropriate for the health service to fund that instead of the individual. However, the area seems to be worth looking at, particularly given that, as we have highlighted, last year the cost to the health service of paracetamol, ibuprofen and antihistamines was around £17 million. That is a significant amount of money.
On the use of agency staff, which seems disproportionately high, the report states that there is a difficulty for the NHS in recruiting staff at what seems to be almost all levels. Is that correct?
We highlight in the report that the NHS is facing problems in recruiting and retaining its staff. The situation affects different parts of the country differently, and it affects different specialisms and types of staff differently as well. I think that the challenge for the NHS is that, in most circumstances, it must have a member of staff present for quality and patient safety reasons, and if there is a gap in the rota, one cannot avoid bringing in a temporary member of staff.
As we say in the report—and as we have reported in more detail previously—the way in which that is done really matters if it is a short-term fix. On the whole, having your own bank is cheaper and provides higher-quality care than using an agency. Obviously, the longer-term solution is to draw back and look at workforce planning in the way that Ms Harris was suggesting earlier.
You might not have an answer to this question, but is it more profitable or better paid to be employed as agency staff than it is to be a permanent employee of the NHS?
We have not looked at that in depth recently, but when we last looked at the issue it appeared that the drivers were more about flexibility for staff and their ability to choose their own working hours and location in ways that would have been less available to them had they been on the permanent establishment of a hospital or other healthcare setting. It costs the health service more to use an agency because it involves VAT and commission, but that does not necessarily mean that the member of staff is being paid more directly. It appeared that the attraction was the flexibility.
Good morning, Auditor General. Exhibit 6 on page 29 illustrates perfectly the challenges that we are facing in our NHS. It does not paint a great picture. I know that Colin Beattie has touched on some of the positives in the report—and they are welcome—but we also see that over the past four years national performance has declined in six of the eight key waiting standards. At the moment, only one of the eight indicators is being achieved.
You said in your opening statement that NHS funding is not keeping pace with increasing demand and the needs of an ageing population. If nothing changed, what could the table look like next year?
As you will understand, auditors are uncomfortable with speculating about what might happen, but we have highlighted very clearly in the report that the service pressures and financial pressures on boards are increasing and that the solution to that is to make faster progress with the Government’s vision of reducing reliance on acute hospital services.
For example, the accident and emergency four-hour standard can be a real measure of people who simply cannot receive the care that they need anywhere else, such as through an urgent GP appointment or by receiving social care, which could help keep a frail older person safely at home. As a result, we believe that the long-term solution is to invest in services that might allow people to avoid the need for acute hospital care. However, as we say in the report, that is not happening fast enough to relieve the pressures that you will have seen on standard performance and on the financial performance that we have also reported on.
One of the statistics that concerns me most relates to child and adolescent mental health services. I note that five of the 14 territorial boards have failed to meet the 18-week child and adolescent mental health services target. Why are health boards failing to keep up with demand? We know that demand is increasing and we know that the Scottish Government has made mental health a priority, with an extra £150 million committed to it over the next five years. However, the statistic that I gave, which has been raised by members across the chamber, is really worrying. Why are we not getting that right in our NHS?
I completely agree with you that it is a very important service standard. I will ask Jillian Matthew to give you a bit more detail in a moment, but it is worth noting that we are also planning to do some detailed work to drill down specifically into those services.
As Monica Lennon said, we have figures in the report that show that the number of patients has increased. Historically, the target has been challenging for boards to meet, although the position has improved slightly over the past year. It is one of the specialties where there are great difficulties in recruiting staff, and there is a shortage of consultants and other staff to work in CAMHS. As Caroline Gardner says, we will look at the area in more detail next year.
That report will be very welcome. Another aspect of this report—this is obvious to all of us—is that significant health inequalities still persist. In all the reports that I have seen, I do not see any real improvement on that front. Why is that the case? It is a very thorough report looking across the NHS, but why are we still failing to tackle health inequalities?
I am sure that you know better than I do that that is a very complex area—there is no single reason why we are not tackling it faster and there is no single thing that would make a difference. Again, it is one of the really important reasons to break out of the cycle of focusing on the acute health services meeting targets for treating people in hospital, without having a picture of the whole health and social care system and a plan for shifting more care and more provision closer to people’s homes.
Very often, healthcare inequality has multiple causes. It starts very early in someone’s life or even during their mother’s pregnancy. It is one of the reasons why we have highlighted in our recommendations the need for a public health strategy and more emphasis on the preventative healthcare agenda, as well as the need to make sure that the acute hospitals are playing their part in the overall system.
There is no one thing that would fix health inequalities but there is a real risk that if we keep on focusing primarily on the acute hospitals, we will make that gap even more difficult to close over time.
Good morning. I want to touch on part 2 of the report, on service reform. We know locally and from the Government targets for service reform—and it is brought into sharp focus by your report—that change is necessary and that how we provide health services has to keep evolving.
The other part of the report mentions difficulties in the recruitment and retention of staff, especially in rural areas; in NHS Highland, we are having to look at different models of staffing.
Members of the public can be suspicious of change if they are not consulted and not kept fully informed about what is happening in their area. Do you have any comments on how the public are being consulted by different NHS boards? Is it working? Are the public happy? I do not want to pre-empt anything, but I already know the answer to that question for my area. Also, are staff being taken along with the service reform?
You are absolutely right about the concern that there can be about changing services; that is particularly the case when finances are tight, because changing services can very easily look like cuts rather than change.
There is a particular difficulty with this sort of reform because we all recognise a hospital; we know what it looks like. Our parents may have died in a hospital; our children may have been born in one. To feel that we are losing such a visible bit of the health service often feels like a loss. As managers in the health service, as politicians and as people with a stake in this, we are often not good enough at painting a picture of what would replace it and how it would be better in many ways. I think that more could be done there.
I know that a lot of effort goes into this area in health boards across Scotland. I was interested to hear colleagues from NHS Highland giving evidence to the committee last week about not just consulting on plans but involving people in developing plans and taking stock of what is working now and what would work for the future.
However, given the scale and the pace of change that we need, we almost cannot do too much of that. That is really where the attention needs to go and it needs leadership at all levels, from the cabinet secretary to the nurse on the ward whose job will be affected. Staff clearly need to feel that they have a stake in it, rather than that they are being dragged along by changes that they cannot influence.
Page 24 of the report says:
“The NHS is facing problems recruiting and retaining staff”.
We have had different levels of staffing in NHS Highland from anaesthetists through nurses, junior doctors and consultants in hospitals such as Caithness general. We have looked for general surgeons and consultants but there seems to be fewer of those as more of them specialise. That is obviously good for the major hospitals and centres but not so handy for us. We now have consultants and surgeons on rotation from Raigmore, which seems to be working at the moment.
Reading through pages 24 and 25, it is clear that it is not only NHS Highland that faces such a challenge. A lot of health boards have problems with recruitment and retention. Why is that? It seems to have happened all at once and I do not know that we have had a satisfactory explanation.
The answer is similar to the one that I gave to Ms Harris at the start of the meeting. We do not know the answers. There are different stories and views of what is happening and that is why we are planning to do a detailed piece of work on the situation.
In a moment, I will ask Carol Calder to give you a bit more insight because she is planning that work.
It is worth noting that, for the future, areas such as the Highlands will need different types of jobs. A GP there will need to play a role that is different from that which they would play in the deep-end practices in Glasgow. That will affect the other members of the primary care team and people who work in hospitals. That is why we think that we need a workforce plan that is not just about how many and what type of staff we need, but about how we get those skills in place.
As Caroline Gardner said, the issue is about changing roles and responsibilities to deliver different models of health and social care. At this stage, we do not have a national work plan that we can use to identify what the skills capacity will be to deliver a changed health service.
We have started a piece of work to unpick some of the issues around the retention and recruitment of staff, but it will be about looking at what we need the health service to deliver and then working backwards to the lead-in times to train GPs and nurses. That means that we cannot change very quickly, so we need to look forward to identify what we need and then work backwards to change what trainees are coming through and so on.
I have one more question. We talk about shifting the balance of care from acute services to more community-based services. You might not be able to answer this but I want to get it on the record. Are our care at home and community care services ready for such a huge shift? If not, what do we have to do to ensure that they will be?
The short answer is that, as we found in our work, there are some great examples of new types of care that are not just providing traditional care in people’s homes but are working upstream to identify older people and others who need particular support to keep them safe and living full lives at home. We reported on that in our March report “Changing models of health and social care”. However, there are not enough of those examples and they are not developing fast enough to make a difference across Scotland.
One of the things that is slowing down the growth of those services is the need to keep on meeting the demand that turns up at the doors of the acute hospitals because the new services are not yet there. There is a risk that that will turn into a vicious circle, so there needs to be a plan that will help us to break out of it and identify how we can invest enough in community-based and home-based services that will break the cycle of rising demand on the acute hospitals and build the services that are needed across Scotland.
There are some real beacons of light out there, but they are too isolated to make a difference to the acute hospitals so far.09:30
I have a couple of questions. The first relates to page 15 of your report; there is something that I want to check. In paragraph 28, you say:
“NHS Shetland was unable to locate over four per cent of its assets included in its fixed asset register.”
I find that rather concerning. Is that unique to NHS Shetland or is it a problem across the estate?
That was a particular problem in NHS Shetland. The auditor concluded that the assets had been recorded properly when they were first acquired but that, as they were disposed of or taken out of service, they were not written off appropriately. NHS Shetland has undertaken to make sure that its asset register is up to date and is kept up to date for the future. The problem is quite an unusual one for us to find in the health service.
So you can be confident that it is unique to NHS Shetland.
I have a wrap-up question. On pages 6 and 7, you make a number of recommendations. You mentioned earlier that you are uncomfortable about speculating—I understand why—but you make some very important recommendations. Let us assume that all those recommendations are taken on board and implemented. Is that a solution?
There is a great deal of consensus not just in Scotland but more widely that the Scottish Government’s vision to provide more care in homely settings or in people’s homes is the right one and is the solution not just to the financial pressures but to the need to provide all of us with better care as the population ages.
A plan for implementing that vision is needed because, first, it is not happening fast enough and, secondly, nobody is clear about how much investment is needed, and where, to bring it about. In yesterday’s statement to Parliament, the cabinet secretary committed to producing a plan by the end of this year. We will look at it closely to determine to what extent it picks up the funding implications, the staffing implications and the public engagement questions that Ms Ross raised to make sure that it can have the desired effect. Nobody has a better plan for the overall vision; the question is about turning it into reality.
On page 36 of your report, you mention that although the idea of a shift in the balance of care has been in play for some considerable time, it is clear that it has not happened yet. Can you say why that is the case? If all the stakeholders are saying that that needs to happen and that that is a solution, why has it not happened for the best part of 11 years?
It probably comes down to a couple of things, one of which is that the acute services have no option but to respond to demand when it appears—for example, when someone who attends an A and E department needs an emergency medical admission that means that they cannot stay at home any more. We have been in a position—it is almost a vicious circle—in which, because there has been an insufficient number of the right services in the community near people’s homes, more people have been admitted to hospital. We have done the analysis that shows the trends in that, particularly with an ageing population. In turn, that reduces the resource that is available to invest in the services that would avoid that happening in the first place.
We think that what is needed is a plan to break out of that cycle. We need to make sure that we know where the investment is needed in the buildings and services and the staff—GPs and community nurses—that are required and that there is much closer working between community services and the hospitals. The integration authorities should play a significant role in that. They came into effect on 1 April this year, so it is still early days. We know that some of them are still struggling with agreeing their budgets and their strategic plans.
In our report, we recommend that a boost be provided to make sure that the aspirations that are in place become a reality quickly enough to make a difference to the pressures that are being experienced across Scotland’s health boards.
I will start with staffing, which is an immediate issue in some of the areas of pressure, both geographically and in terms of specialism, that you have referred to. There is also the big strategic issue of how we solve the problem. It is estimated that, across the world, we an additional 70,000 doctors will need to be recruited in the next 15 years, so we are talking about an international labour market.
When Paul Gray, the chief executive of NHS Scotland, was here, he said that an additional 100 training places were to be made available for entrants into medical school. That is a welcome development, but given the projected demand for services and taking into account the fact that we are operating in a competitive international labour market, is 100 extra places anywhere near enough?
It is not possible to answer that question in isolation. The question of how many staff we need, of what sort and with what skills, is something that the Government needs to set out as part of the plan for how we achieve this. Staffing is one of the big challenges. With an ageing population, there will be fewer people of working age available not just to be doctors, but to work in nursing, social care and all the things that are needed to make the policy work. It is possible that our exit from the European Union will make that more difficult, depending on what happens with migration across borders.
On the other side of the equation, new technology makes some things possible that were not possible in the past—holding consultations by Skype is an interesting innovation in some parts of the Highlands. There is also the community empowerment agenda: we can think again about how communities take more responsibility for looking after their members, and how all of us individually can take more responsibility for that.
We would like to see all that detail in the workforce plan, which would help us to say whether 100 doctors is a useful contribution or is what is needed to deliver the vision.
We hope to get that plan fairly soon.
The cabinet secretary committed yesterday to producing it by the end of the year.
Ever since the national health service was created, the British Medical Association has been resistant to significantly increasing the number of trainees being recruited to medical school, saying, “We don’t want any unemployed doctors.” That is just one of the restrictions that the BMA has imposed for the last 60 years. Is it not time that we looked at such restrictive practices and at the productivity of our specialisms?
Let me give you an example: in NHS Lanarkshire, one of the reasons for redesigning orthopaedic services has been that for an orthopaedic surgeon to operate safely, they should carry out a minimum of 35 procedures a year, but apparently some surgeons have been carrying out as few as five procedures a year. Now, those people may well be doing other things, but is it not time to examine the productivity of those consultants to see whether we are getting value for money? If they are not performing during the week, they are then employed over the weekend on triple time, which is a financial bonanza for them, but is very costly for the health service. If that does not happen, we end up with patients having to go to the private sector in order for the waiting time requirement to be met. Is it not time that we drilled into that to see whether we are getting value for money?
Mr Neil will know better than I that the Scottish Government has produced a couple of reviews over the past 15 years, looking at the way in which acute hospital services should be provided for the future. The first report goes back to about 2005 and there was a review and then a refresh of that a bit later on.
It is clear that the evidence is that we need to reconsider having more regional centres for some specialist procedures, thinking about the role of acute hospitals to ensure that they are both safe and efficient. Productivity is a key part of that. That is part of the answer to ensuring that hospital services are as high quality and efficient as they can be for patients, and that they are dealing only with the patients who need that type of care, so that we have resources that we can reinvest in services for people who could stay very happily and safely at home with more support from a good community team. The groundwork is there, but what is needed is the planning to turn it into a reality. That is not to say that it is easy, but it is increasingly important.
I understand that an internal review of productivity in the NHS in Scotland was carried out. Have you seen that report?
I have not. That would be a question for the Government.
I think that you should see it—we should ask for a copy. Productivity is an extremely important element in all this and there are many restrictive practices that inhibit our ability to rise to some of the challenges, particularly in the short term.
I want to return to the drugs issue. One of the exercises that we carried out when I was Cabinet Secretary for Health and Wellbeing was to compare the use of drugs in each health board. Comparing like with like, we reckoned that if every one of the 14 territorial health boards was as efficient at managing its drugs bill as the best health board was, at that time, we could have saved more than £100 million a year. Given those figures, is it not about time that we revisited that exercise and took the necessary action to ensure that we get a far better return on our money for the drugs?
Given the amount of money that we spend on drugs and the rate at which it is increasing, making best use of the drugs bill is a really important part of helping the health service to meet the pressures that it faces. The figure that you have touched on is very much in line with the figures that came out of our reviews of prescribing in previous years. Our report says that the Scottish Government has established, with health boards, a task force that is looking at four areas of efficiency—I think that drug costs is one of them. You may like to explore that further with civil servants in order to understand more about their approach and what they expect the benefits to be.
If we can save anything like £100 million a year, that is a significant saving that can be redirected to other front-line services.
Finally, as Auditor General for Scotland, what do you expect to see in the delivery framework that we are, apparently, getting by Christmas? Are you looking for a business plan, or an operating plan? Are you looking for a five or a 10-year framework? Are you looking to bring the whole thing together, including the staffing, technology and funding? What are you looking for that delivery framework to do?
We try to be as clear as we can in the report about what we think is needed. There are three areas to that. The first one is a financial plan that contains the sort of financial modelling that we have been talking about, and a funding plan, in case there are gaps in how we get from here to where we need to be. The second area is a clear workforce plan for the numbers of staff that we need and their skills, and how, in the long term, we will train those people and, in the short term, manage any gaps that exist. The third area is the plan for engagement with people across Scotland about why this matters and how they will be involved in shaping services for their local area. Those are the three key things that need to be covered for the plan to have the effect that we think is needed.
Alex Neil talked about the BMA and restrictive practices. There is more involved, though. If we go back to doctors’ training 30 years ago, there was fierce competition to go from trainee level, when one became General Medical Council registered, into specialist training. That situation is acknowledged among the generation of doctors who are now near retirement age. Something must have happened to change that. Those doctors could recount to you the competition in their day—it was horrifically difficult to get into specialist training—whereas now we are scouting around begging for doctors to train as specialists. There is something more than just the restrictive side of the BMA—although I am not condemning the BMA in any shape or form. As I was discussing earlier, we need to look at what has gone wrong—at that little chink. Something has happened in 30 years. I do not understand it, at all.
Those sorts of questions are very much why we are planning our new audit on workforce planning. I will say, though, that it is very clear that we cannot do that without doctors and nurses being part of it. There may be some historical anomalies that need to be ironed out of the system. Equally, there are more opportunities, particularly for GPs, to work as partners in the health service rather than as contractors with it. I know that the Scottish Government is thinking hard about negotiation of the new GP contract and about making GPs very much a central part of the transformation that we all want to see.
I would like to understand a little bit more about non-recurring savings. If you do not mind I will use NHS Tayside as an example—I know that we are coming to the report on it later. If I understand it correctly, exhibit 2 says that 60 per cent of NHS Tayside’s planned savings are non-recurring. My understanding of non-recurring savings is that they include, for example, the one-off sale of an asset. NHS Tayside is selling off property. Those are non-recurring savings—one-off savings—but why are recurring savings not happening at the same time as non-recurring savings? Why is that percentage so high?09:45
I will try to keep my response general in this case, because I know that you will want to explore the section 22 report on NHS Tayside in more detail later this morning. You are right—non-recurring savings include sales of property and other assets. Another saving might come from short-term delays in filling vacancies. For example, if a member of staff leaves, rather than filling the post immediately, a board might keep it vacant for a while and take the saving that comes from that period, if it feels that it can do that without affecting the quality and safety of the service that is provided to patients. Those are all things that can help in the short term to close a funding gap, but clearly they do not do much to make a board’s financial position more sustainable for the longer term.
You will see in both exhibits in the report quite significant variation among boards on how much they rely on recurring and non-recurring savings. In this and previous years, we have found that boards often plan a higher level of recurring savings than they are able to achieve. They expect to be able to redesign a service in order to provide the same service at lower cost, but it either takes them longer to do that or the savings do not reach the expected level so they fill the gap in their budget with a non-recurring saving. We have a concern about that: it is not sustainable and it focuses a lot of effort on short-term financial management rather than on the long-term planning that is needed to deal with the issue.
What are the reasons for the disparities in recurring savings and in the 14 boards’ success at making those recurring savings?
The reasons vary in boards, as you would expect. I will leap ahead slightly to the section 22 report on NHS Tayside. We have reported that analysis suggests that its operating model is more expensive than that of many other boards and that, so far, it has not been as successful as it had planned to be in producing efficiencies that would bring down costs and, at the same time, close the funding gap. Other boards have made more progress in redesigning services and at taking approaches that help them to bring the revenue that they receive from the Scottish Government into line with their expenditure in each financial year. The reasons are different in every health board.
Jillian, do you want to add to that?
I do not think that there is anything else to add.
Is it an issue of management, planning and strategy?
There are elements of all those. In many cases, the disparities also reflect the starting point—the position that each board is in. Some boards have historically had more generous funding than others and have therefore found it easier to make recurring savings. Others’ models of service had recently been reviewed, so there was not as much space or headroom for them to generate savings. There is a wide range of reasons across the different boards.
You are right, however, that the approach that boards take, how effectively they involve staff in thinking about better ways of providing services, and the scrutiny and support that they provide in making sure that plans are realistic and are being carried out as planned all play a part.
As an auditor, how comfortable are you with 60 per cent of savings being made through non-recurring savings?
In broad terms, that figure is too high. We are looking for not just an annual budget, but a medium-term financial plan covering five years or so that is very clear about the likely levels of revenue from the Government and expenditure, and which has detailed plans for closing the gap sustainably.
I have a general question about agency costs. We have already touched on recruitment and retention problems. What else could health boards do to prevent spending on agencies?
It is very important, for cost and quality reasons, to minimise use of agency staff in favour of a staff bank that is managed and owned by the health board itself. In response to Colin Beattie’s question, I said that it is often the flexibility that is attractive to staff, rather than the fact that they are being paid more. Most health boards have a bank where nursing staff—also medical staff in small numbers—can register as being available for temporary work for ad hoc shifts and to fill gaps as they occur. They are generally paid on standard NHS terms and conditions, so the cost is lower. They know the system, they can be trained and inducted, and they know how things work. A staff bank is better in every respect, than having to turn to an agency.
Because of the health service’s nature, most boards will on occasion have to turn to agencies. The challenge for the boards is to minimise reliance on agency staff, to invest in their own bank and, of course, to do the work to make sure that their workforce is fully up to capacity and planned for the longer term.
To come back to what you said about prevention, I sympathise with that agenda. Last night in Parliament, we launched a cross-party group on the preventative agenda for non-communicable diseases. I know that you have tackled the issue before, but is there a way to audit prevention and its impact on the health service?
That is a great question, but there is no easy answer. It is not just about the health service: many of the problems that the health service ends up having to deal with come from children’s early years and from problems including poverty and poor-quality housing, rather than relating simply to health or even to health and social care services.
In many ways, that is why we focus on what the Government is trying to achieve in its outcomes in the national performance framework, in all the money that it spends and the budget process, and through the services that it provides. We try to look back upstream and see how far things are joined up, but it is very difficult to audit everything all at once. That is why we tend to take slices in the way that we do.
You perhaps cannot answer this, but is that one of the reasons why we have not seen much of a resource shift to prevention—not just in the health service but across other services? It is very difficult to audit and create results on prevention.
It is not just because prevention is difficult to audit—it is also difficult to do, for two reasons. First, it is genuinely difficult because we say that we want to make Scotland a country in which everyone has the chance to flourish. We therefore need to think holistically about healthcare, education, early years, justice and housing, and about how all those areas develop. The new social security powers provide another dimension that needs some thought.
More generally, we have reported in a number of instances on what we see as a gap between the outcome that the Government wants to achieve and the detailed plans that it has for its services; it is not clear how one relates to the other. We think that filling that gap would make the national performance framework and the outcomes approach more productive in changing people’s life chances over time and in tackling some of the problems that we see in health and social care, justice and education.
I thank you all very much for your evidence on the report.