When you concentrate on saving money, you push costs up


As I usually do this time of year, I have been leading seminars with some of the annual crop of Darzi fellows, the cadre of doctors, administrators and senior NHS health workers who take time off out of their career to do some thinking and investigating.

It is a brilliant programme, and I hope I play a role in introducing some of them to some of the latest thinking from outside the NHS, in the field of co-production. I certainly get a lot out of meeting and learning from them.

I have noticed their mood change over the years, from despair during the junior doctors’ strike, to anger during the last funding crisis. Now I find it a little hard to read, but there is definitely included in the mix just a whiff of guilt.

The doctors I know are certainly aware of the reputation their profession has for steam-rollering, professional arrogance and pomposity, even though I have never my entire life met a doctor who could fall into any of those categories.

It is as if they know they are supposed to feel bad, but don’t quite do so. Nor should they.

As I head up to London for the second session, I have been wondering what to say to them. Because it is true that society has suffered from the arrogance of professionals. Look at the architects if you want to see a profession so wrapped in its own self-importance that they don’t see them damage they do. Look at journalists (heavens, I remember my own training, goodness knows). Look at PR professionals.

It I also true that, after the launch of Nesta’s People-powered health campaign some years ago, we were told by a senior doctor that no amount of evidence would make the kind of changes we wanted, because of an in-built professional ability to dig in the heels.

But let’s be fair to the medical profession. They redeem themselves by their extraordinary commitment to individual patients, despite their constraints imposed by officials, and do so every day.

It is true that consultants tend to view the system as if it was designed for their convenience. And if we were really to reduce hospital admissions as much as other places have, we would bankrupt the foundation trusts. Which is why they resist.

But the real problem in public services, it seems to me, is not professional arrogance (thought that certainly plays a role). It isn’t even austerity (thought that hardly helps either). It is the way that officials have tried to reduce healthcare, teaching and job readiness programmes – and most of the rest – to narrow deliverables, which as it turn outs simply spreads extra costs to other parts of the system.

This is one of the side-effects of efficiency, when driven for its own sake. The system thinker John Seddon explains the great paradox, that – if you concentrate on cutting costs – costs tend to rise. Only if you concentrate on effectiveness do the costs go down overall.

To be truly effective, and cost-effective, you need some elements of humanity, some elements which might be considered wasteful. As long as they work, and work permanently.

The phenomenon of tackling symptoms, because it seems the cheapest option, certainly affects the NHS – but far more broadly than that. Nor is it a legacy of recent years. Nor is it mainly the legacy of the years since the Great Crash of 2008. It is a legacy of the IT fantasies of the Blair and Brown years.

It remains a problem. Whitehall is unfortunately committed to the same fantasies as before. It isn’t the fault of doctors.

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Radix is the radical centre think tank. We welcome all contributions which promote system change, challenge established notions and re-imagine our societies. The views expressed here are those of the individual contributor and not necessarily shared by Radix.


  1. nigel hunter says

    I had a conversation at a scarecrow festival on this . The ex -procurement officer from the NHS said that you have to go for the cheapest option. Invariably costs went up cos the cheapest did not fulfill the need required. Nurses on the ward who know what is required were not consulted on what was the best option. Result- cheapest does not work. It has to be cancelled and ‘research’ is done to see what went wrong when by asking the experts (nurses) whilst probably costing more the right result is achieved and no further purchases were required.i Doing a thorough job from the start is a good idea. I will have to look up my information on what was said. I may get back into the subject

  2. nigel hunter says

    I have found the original hoorah!!

    In a conversation at the local Scarecrow Festival (you should go to them) the NHS came up.Hunt,according to information received had the option of 21 reports to read on his 7 day NHS. He chose to read only 4 out of 8. Why did he not get someone to precis all 21 to get a full briefing of the papers?Surely this can be done to get the wider/fuller picture.. Was he picking out a case to back up his own ideas and not the best for the NHS.

    The conversation went on to a procurement discussion. How goods are bought by the NHS. An example was given.
    There are 2 cardboard boxes, one just a box, one a box with additional ‘bits’ to build a better machine for example. This 2nd box was 10% dearer The procurers went for the cheapest box. By doing this they had to contract the bits required to different companies and the original price of the empty box rocketed. cos each individual part had further cost to it whereas the 2nd box had it ‘all in’. Result that the procurement system cost the NHS more than necessary.
    As one of the 3 was an ex US citizen who still kept in touch with her homeland she commented on on the fact that Health Insurance covered, for example cancer checks and medication but not the operations that were needed. Their health insurance was not all inclusive unlike the NHS which as a result cost the US health system more (they are not in the top 10). We have the best system but with Brexit we stand to loose workforce, prestige and through hiring agency nurses costs will increase. Bursaries should be brought back as an inducement for recruiting from 6th form onward’s and if people from abroad wish to train.

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