Bottomley orders review of NHS market structure: Top-to-bottom inquiry could lead to senior executive job cuts

THE GOVERNMENT ordered a top-to-bottom review of its market-oriented reorganisation of the National Health Service yesterday, and signalled a further wave of job losses among senior management.

In February, Virginia Bottomley, Secretary of State for Health, told the 14 English regional health authorities to shed more than 5,000 administrative and clerical jobs. Now she is considering cuts in the 1,400-strong NHS management executive.

The wide-ranging remit given to the review team represents a victory for radical right-wing critics of the Government's health policies. They argue that the NHS 'reforms' have stagnated through constraints on the operation of the internal market and excessive interference from regional and Whitehall bureaucrats.

The review will be chaired by Kate Jenkins, a member of the NHS policy board, and a key architect of moves begun in the mid-1980s to transform large parts of the Civil Service into more streamlined, semi-autonomous executive agencies at 'arm's length' from ministers.

Decisions over the future structure and functions of regional health authorities - providing they survive the scrutiny of the review - will be influenced by the recent financial scandals at the Wessex and West Midlands health authorities.

Sir Duncan Nichol, the NHS chief executive, is known to support changes to improve the accountability and probity of those running such bodies.

The review will look at the functions and manpower in the NHS above the level of local hospitals, GP services and purchasing authorities. The team has to report back to ministers by July.

Mrs Bottomley said: 'The continuing development of the NHS reforms requires the structure . . . to be examined.' The Government was anxious to consider ways in which management costs could be minimised, while ensuring continued public accountability, she said.

Many executives now running the opted out NHS trusts believe that constant Whitehall and regional health authority intervention has blunted the competitive edge of the market system.

There is frustration that innovation in areas ranging from fixing staff salaries and contracts to advertising on television and radio has been virtually impossible two years on. Dr Martin McNichol, chairman of the NHS Trust Federation, welcomed the broad remit given to the review team. 'If you are operating a social market, you probably don't require a large Department of Health or NHS management executive,' he said.