NHS spending on management consultants is ‘shocking’
Published: 10 May 2009
The Royal College of Nursing describes the amount of money the NHS in England spends on management consultants as 'utterly shocking'. The NHS spent £350 million on external management consultants in the last financial year. More than £273 million of this was not related to direct patient care and equates to the cost of 330 fully staffed medical wards, each with 28 beds.
The RCN has obtained the figures after questioning 240 NHS organisations in England under the Freedom of Information Act. The RCN says that reducing the money spent on external management consultancy could deliver 11% of the expected reduction in government spending on health announced in the 2009 budget, without jeopardising patient care.
RCN Chief Executive & General Secretary, Dr Peter Carter says:
"These figures are utterly shocking when you consider the difference that this money could have made to patients. A very significant sum of money is clearly being spent on setting up competition in the NHS and pursuing Foundation status, rather than being invested in patient care. You only have to look at what happened at the Mid Staffordshire NHS Foundation Trust to see the consequences of this. The RCN believes that the full expenditure may be considerably higher, and we will be pursuing all NHS organisations to reveal the full extent of this expenditure. No NHS organisation should be allowed to exclude themselves from proper scrutiny".
The RCN is urging Department of Health and local health trusts to look at the money being spent on external advice and what added value this is providing for patients before cutting frontline services, training budgets or new facilities. Dr Carter added:
"Savings in this area could contribute a huge proportion of the savings to be made by the Department of Health following the 2009 budget, without jeopardising patient care. Instead, this money has been spent on external management consultants developing competition within the NHS. Where that pursuit has been at the expense of patient care it cannot be allowed to continue."
More than 40% of organisations questioned by the RCN did not respond within the deadline required in law. The RCN is currently pursuing these organisations both for full disclosure of their spending and for an explanation of why the information was not made available for proper scrutiny.
Read more about the RCN's concern over trusts pursuing Foundation status in the NHS Foundation Trusts Survey: Big business or everyone's business?" (PDF 124 KB) [how to access PDF files].
The RCN made requests to 550 NHS organisations across the UK, of which 296 gave full responses. Data used relates to the 240 organisations who returned information in England only. The RCN has found that some of the work consultants have been paid for includes:
- market testing and development (39%)
- supporting Foundation Trust applications (23%)
- provider separation, which relates to the separation of governance and financial management of Primary Care in terms of commissioning and providing services (13%)
- Private Finance Initiative advice (12%).