Leading article: Painful surgery still required

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The findings of the latest report on the NHS from the Healthcare Commission do not come as a complete surprise. We knew that one-third of NHS trusts were in deficit, so it is little wonder that 210 have been graded as weak financially. But it is nonetheless shocking that 50 trusts are graded weak, not just for financial management, but for the services they provide, while 290 are deemed only fair. This means that more than half of the NHS has been judged to be underperforming by its own watchdog.

These findings are not necessarily indicative of the quality of clinical care patients will receive at hospitals. But it does show major institutional confusion. Many hospitals have poor control of patient records, while others cannot say for certain whether their staff have undergone essential training.

It is true that, in some respects, the NHS is in a vastly better state than when Labour came to power. Waiting times and waiting lists are down and considerably more staff have been employed. It is also true that the new hospital-grading system is tougher than the old star system.

But these are not satisfactory excuses for such a poor set of results. The former star rating system was widely seen as flawed. Hospitals would pull out all the stops to hit certain centrally imposed targets while neglecting other aspects of their service. The new testing regime is much broader and deeper. What we have today is the most accurate reflection yet of the overall state of the NHS. As for the relative improvement since the Tory years, Labour is now spending some £94bn a year on the health service. It would be astounding if such sums had not generated some improvement.

The real problem is that so much of this cash is evidently going to waste. At the heart of the NHS's problems lies the structural inadequacy of what is still a vast state-run monopoly. The failure of successive health ministers to push through rationalising reforms, such as merging underused hospitals and insisting on proper spending controls, has contributed significantly to the present financial crisis. And these problems have, in turn, forced too many hospital managers to make an invidious choice between maintaining quality of care and coming in on budget.

This report makes it clear that a vast improvement is required. Raising standards and balancing budgets will be painful. But the Secretary of State for Health, Patricia Hewitt, should be making it clear to hospital managers that it will be far less painful to do all this now than after 2008, when the great NHS funding injection is scheduled to peter out. The difficult decisions can be postponed no longer.

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