NHS could make savings of 60m pounds

THE National Health Service could generate savings of pounds 60m to be ploughed back into health- care improvements by making its estate management and pathology services more efficient, and by treating more in-patients as day surgery cases, the Audit Commission said yesterday.

However, efforts to eliminate waste in the NHS continue to be hampered by the poor quality of information available to managers and the preparation of service contracts, the commission says in its annual report.

In his foreword, David Cooksey, the commission chairman, says financial controls and systems are basic in many parts of the country, and good finance staff hard to recruit and retain.

'The lack of reliable, accurate, management information, particularly cost and output data, continues to be a significant obstacle to progress,' Mr Cooksey says. 'There are great variations in efficiency, and significant opportunities for improvements in cost-effectiveness and throughput.'

Even though the new internal market in NHS health-care provision was established more than a year ago, some hospitals are still unable to cost operations properly or find out the average length of stay for particular treatments.

Jeremy Lee-Potter, chairman of the British Medical Association, said the report confirmed that the contracting process between health authority or GP fundholder 'purchasers' and hospital 'providers' was beset by problems. 'It will be several years before sufficiently powerful information systems are installed to enable money to truly follow patients, a major aim of the reforms.'

The commission warned the Government not to add to the burdens of local authorities by making last-minute changes to the council tax, writes Nick Cohen.

The introduction of the poll tax in 1990 became a nightmare for English authorities when the Department of the Environment issued a string of late regulations which councils' computer software was not programmed to deal with. Bills had to be pulped and it took months for treasurers to adjust their systems to cope with the changes.

With protests rising about the council tax, which will come in next year, the commission and many in local government fear that the department could repeat its mistakes and alter the system to meet the protests of objectors.