Managing 60 Years of the NHS

8 September 2008 (Last Updated September 8th, 2008 18:30)

Britain's National Health Service recently marked the 60th anniversary of its foundation. Michael Beachey looks at ongoing struggle to manage this behemoth – the largest employer in Europe through controversy and change that come with the times.

Managing 60 Years of the NHS

Critics say that prior to the NHS, health services were generally uncoordinated, that their quality varied widely from town to town, and that country areas were generally poorly served. At the outbreak of the Second World War in 1939, an emergency medical service was established and provided a template for the future.

In 1948 the NHS was set up under the Labour government headed by Clement Attlee. Its aim was to provide a free, comprehensive healthcare service, with delivery at the point of need, regardless of the ability to pay. The NHS was to be funded through general taxation, National Insurance contributions, revenues from prescription charges and other chargeable patient services.

"The NHS' aim was to provide a free, comprehensive healthcare service, with delivery at the point of need, regardless of the ability to pay."

But many doctors were resistant to the concept of the NHS. Indeed, a senior figure in the British Medical Association (BMA) likened the NHS plan to Nazism and described the Minister of Health as a "medical Führer". Professor Rudolf Klein, Emeritus Professor of Social Policy, University of Bath, and a veteran historian of the institution says that "keeping the doctors happy" has been and remains the story of managing the NHS. The cost pressures are also just as challenging today as in 1948. Over the past 60 years, management has faced the same dilemmas. They include:

  • How to manage or organise the NHS and fund it satisfactorily
  • How to reach a compromise between the often-conflicting demands and desires of patients, personnel and the exchequer
  • How to ensure that limited resources are delivered where they are most needed and at the right time.

Bevan predicted that the problems facing the NHS at its creation would always exist, saying, "we shall never have all we need and expectations will always exceed capacity. The service must always be changing, growing and improving – it must always appear inadequate".

In 1948, 14 Regional Hospital Boards were set up to manage the new organisation. All hospitals (apart from teaching hospitals) were brought together and GPs, dentists, opticians and pharmacists were put under contract. A local authority Medical Officer of Health ran immunisation and maternity clinics, provided community nurses to support family doctors and oversaw the control of infectious diseases. But consultants retained huge powers over how hospitals were run and there was little of the bureaucracy that exists today.

Changing with the times

In management training terms, the establishment in 1956 of the NHS management programmes was a major development, while the Griffiths report of 1983 brought about profound changes in the way that the NHS was managed.

"Supporters claimed that the Griffith reforms increased efficiency and effectiveness, whereas opponents said that they undermined the founding principles of the NHS."

In February 1983, the then Secretary of State for Health and Social Security Norman Fowler established an inquiry into the effective use of manpower and related resources in the NHS. A team led by Roy Griffiths, deputy chairman and managing director of Sainsbury, presented their report, in October 1983.

Its findings are often summarised in the well-known quotation: "if Florence Nightingale were carrying her lamp through the corridors of the NHS today she would almost certainly be searching for the people in charge."

Griffiths found the NHS had no coherent system of management at a local level. It lacked any real continuous evaluation of its performance against normal business criteria: levels of service; quality of product; operating within budgets; cost improvement; productivity; motivating and rewarding staff; and research and development. Precise objectives for management were rarely set and there was little measurement of health outcomes. There was little evaluation of clinical practice and even less evaluation of the effectiveness of clinical interventions.

Supporters claimed that the Griffith reforms increased efficiency and effectiveness, whereas opponents said that they undermined the founding principles of the NHS. Sian Thomas, joint acting director for NHS Employers, says, "I first became a line manager in around 1987. Before then there wasn't any general management. There were administrators who followed rules and made sure that people didn't break them.

But there was no real sense of resource allocation or management. The big change was the Griffiths' era when we moved towards resource allocation and a general management ethos. Before the 1980s quite junior administrators were trying to manage or run huge risky organisations and to be frank there weren't a lot of management skills around".

A battle not unto its own

All governments have faced running battles with GPs, who have regularly threatened to resign from the NHS en masse during disputes over pay and working conditions. But the Conservative government of the 1980s and 1990s endured an especially turbulent time, particularly when the BMA clashed with Kenneth Clarke, a combative health minister. Mr Clarke recently told national broadcaster BBC that "the BMA had never lost a fight in their opinion". However, the Conservative government, influenced by the Griffiths report, blamed inefficient management and structures within the NHS for the problems facing the organisation and in 1990 reformed both management and patient care by introducing an internal market, despite opposition from the BMA.

"From its inception the NHS has been in an almost continuous state of reorganisation with ever-changing targets."

The Labour Government, elected in 1997, accelerated the pace of change. In 2000, it set out its NHS Plan, a ten-year programme of reform and investment in healthcare, aimed at improving clinical performance and the health service's productivity. Fundamental to the programme of reform was the way in which the NHS would be structured and the roles and responsibilities of the organisations within that structure. Together with the Wanless report in 2002 they have influenced health policy ever since. The Wanless report (published in April 2002), by former NatWest chief executive Derek Wanless, into the future of the NHS recommended key changes to ensure that the health service could meet demand and improve care over the following 20 years.

"The biggest change was the development of the concept of targets and improvements," says Thomas. "It was probably the 2000 NHS plan, which actually put a mark in the sand. It told us what was expected of the leadership of the NHS. I think it was absolutely right that there was a step change in expectation, which led to the ten-year vision of how the NHS should be improved. It was totally right to do so for the taxpayer and the citizen. What Wanless effectively did in both his reports was to set out an evidence base for why that was necessary".

From its inception the NHS has been in an almost continuous state of reorganisation with ever-changing targets. As in education it seems most governments can't resist meddling with the health service. Critics say that the structural changes of the last 60 years have not produced any real benefit. They also argue that it is sometimes difficult to judge what has been good or bad. They say that reforms introduced over the years have never been given enough time to succeed. Critics also point out that the continuous restructuring has in fact had negative effects on factors such as morale.

Will the system adopted in 2000 be flexible enough to address the challenges involved in reconciling finite resources with infinite needs? How do we care for an increasingly aged population and the growing numbers of people afflicted with chronic diseases? How will we address obesity or the costs of new technologies and drugs? How do we face the public health challenge of trying to make people more responsible for their own health?

We have to hope that all the recent changes bear fruit and the essential original values for which NHS was set up will last. "There are some enduring values," says Thomas. "But at the same time we have a global economy and we have a situation where people are recruited from all round the world into the NHS. Today's NHS leaders have got to be far savvier and see the big picture." Conditions are changing more quickly now than they ever did when the NHS was set
up."