Nick Clegg's speech yesterday on the NHS was pregnant with political significance. This was effectively an instruction from the Deputy Prime Minister for David Cameron to pull the Health Bill back to the Commons or risk losing Liberal Democrat support for the legislation. David Cameron once told us that "muscular liberalism" is a virtue. Well, this was a flexing of Liberal Democrat muscle within the Coalition. The ultimatum from the Coalition's junior partner will not please the Conservative right, which regards the NHS reforms as, if anything, not radical enough.
Re-opening the Bill will enable some important safeguards to be put in place. But slowing it down poses problems too. Mr Clegg proposes to allow GPs to form consortia when they are ready to do so, rather than giving them the 2013 deadline. Yet the running down of primary care trusts, which the consortia are supposed to replace, has already begun. If GP consortia are not in place by 2013 and the PCTs have been dismantled, who will commission care for patients? In truth, there would probably have been a crisis in 2013 in any case. The expectation that groups of GPs, most of whom have zero experience of management, would be in a position to handle four-fifths of the health budget within two years was always misguided. But the question of what will happen to those patients who are not covered by either a PCT or a GP consortium needs to be answered – and soon.
There is another problem. Even if this shake-up delivers the kind of efficiency savings hoped for, they are not going to do so immediately. The danger is that this overhaul will be a distraction from what has been termed the "Nicholson challenge". This is named after the chief executive of the NHS, David Nicholson, who has made it clear that, because of rising demand for healthcare, the NHS must find efficiency savings of £20bn by 2015 merely to provide the same level of care as it does at present. A great deal of energy is being expended on an institutional overhaul when the real health challenge is a simple one: cut costs.