Date Published: 23 October 2006

NHS Confederation comment on Government announcement on productivity indicators

Commenting on the Department of Health’s announcement on productivity indicators, Nigel Edwards, director of policy at the NHS Confederation which represents over 90% of NHS organisations, said:

“ Today’s government announcement of productivity indicators are a welcome step towards helping the NHS become more productive and delivering value for patients and the public.

_ However, NHS managers believe that we need to go further than this and radically overhaul the approach to measuring productivity by putting patient satisfaction and outcomes at the centre of a new approach.

_ The current measure of productivity in the NHS used by the Office of National Statistics (ONS) is too simplistic and potentially acts as a perverse driver. It divides outputs - activities the NHS does such as operations or ambulance trips - by inputs, such as people and capital.

_ Using this measure, the NHS would be at its most productive when the maximum number of people are admitted to hospital. This is nonsensical as the NHS strives to reduce hospital admissions and treat more people within the community or even in their own homes.

_ NHS managers know that as they step up their battle to improve value for money, they must increase productivity before they can make the case for extra government funding.

_ A recent Confederation poll of NHS chief executives revealed that 95% of the 203 who responded said that the NHS must increase productivity and cut waste before they can justify more funding in the government’s next spending round. Getting better value for money from clinical processes and staffing were the areas where chief executives believed they could release the most resources, the poll found.

_ But we won’t know if we have been successful in our drive to improve patient services through increased efficiency and productivity until we have a sensible way of measuring productivity.”

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