Today, the government is publishing it's Health and Social Care Bill, which envisages the abolition of Primary Care Trusts (PCTs) and Strategic Health Authorities (SHA) and the transfer of most commissioning powers to GPs and responsibility of Public Health to local authorities.
For the last few years, I have sat as a Non Executive director on Northumberland Care Trust, our local PCT. When I read the coalition agreement and it said there would be no top down re-organisation of the NHS, I was relieved. Every year under Labour a new secretary of state would put forward a new minor tweak of the NHS which would cost a lot of time and money to implement.
Labour abolished the Tories internal market, as in their manifesto, then spent 13 years introducing it again. We had Primary Care Groups, then PCTs, then PCTs were merged into larger organisations (except in the North East where the boards weren't merged but management was!), SHAs were founded. Then there was Practice Based Commissioning, the compulsory provider-commissioner split, which saw my PCT have two boards, compulsory commissioning of private sector treatment centres (which has led to a private sector hospital in Washington which has not many patients but has to be paid for at 100% occupancy).
All this change was possible with an overall improvement in the standard of the NHS because there was a massive increase in funding for the NHS. It did lead to a massive (PFI funded) building spree and a genuine improvement in standards in the NHS. All during this time the NHS budget for drugs and treatments was outpacing inflation as medical science improved. Towards the end of the last government, the above inflation increases stopped and it was clear that savings would ave to be made to keep pace with the above inflation increases in treatment and drug costs.
The government decreed massive savings in NHS management, which led to between 20% and 40% reductions in PCT management costs. This has had little effect, perhaps proving they were somewhat overstaffed before.
However, if NHS funding increases only keep up with inflation (and both Labour and the coalition government don't seem to propose anything more generous), you actually need to cut back in areas of the NHS. Obviously management charges are the obvious area. If you keep the SHAs and the PCTs you can't cut them back much more without them not working. I was very happy with the abolition of the SHAs (and had advocated it during the election) as they served little role in the North East and mainly just seemed to boss PCTs about, further reducing the sovereign nature of the PCT. I was a bit stunned by the abolition of the PCTs, it was a big bold step. I was pleased with the movement of public health to local authorities, which have accountability to local people (although PR for local government would increase that but that's another story!).
Labour say that the NHS shouldn't reform radically at a time of cutbacks in management. Ideally not but if we are to make further savings in management and not lose money for front line services, how else do you square the circle? I do not think it will mean a widespread abolition of the NHS model but hopefully it will be less of a nationally controlled "top down" NHS. That does mean there could be differential levels of provision locally. As a Liberal, I think that is a price worth paying for local accountability and decision making.