Health leaders must be honest about financial challenges ahead

Local and national NHS leaders, as well as politicians, must be honest about the scale of financial challenges ahead and engage the public and health care staff about how they propose to deliver quality while reducing costs, says a report published by The King's Fund today.

Windmill 2009: NHS response to the financial storm, considers how the NHS can best weather the approaching ‘perfect storm’ of resource constraint, rising costs and increasing demand fuelled by an ageing population and increasing patient expectations.

Report authors call for politicians to be open about the implications of the economic downturn for health spending. And, vitally, for government and regional health bosses to resist reverting to 'command and control' but instead encourage local commissioners to take a stronger leadership role across the whole of their local health care community in developing a response to budget constraints.

Authors also urge NHS managers to involve staff more in developing solutions for 'worst case scenarios' by using their knowledge of local circumstances to make decisions.

Windmill 2009: NHS response to the financial storm details the findings of a two-day simulation event, which involved 60 policy-makers, regulators, commissioners, managers, clinicians and patient representatives. Participants were given two near-future scenarios that posed questions about how primary care trusts and local service providers should start preparing for the less generous period of NHS funding ahead. Windmill 2009 was designed and facilitated by Laurie McMahon and Sarah Harvey of Loop2, and led by Alasdair Liddell, Senior Associate, The King's Fund.

The King's Fund Director of Policy, Dr Anna Dixon, said:

'The Windmill simulation provided a fascinating insight into how the NHS is likely to respond to a serious downturn in the levels of funding in the near future.

'It is clear that the NHS needs to start planning now and engaging staff and local people as it faces some difficult choices ahead. It's vital that politicians are honest about the level of funding available and support local leaders in making these tough decisions.'

Report co-author Alasdair Liddell said:

'There's a danger that the recession will provoke the different organisations that make up the NHS to turn inwards and focus on their own survival as institutions rather than thinking about how they can work together to continue to provide the best service possible to their local communities. That might require new partnerships and innovative ways of working with others, so this certainly isn’t the time for private and third sector providers to be dissuaded from getting involved in providing NHS services.'

Co-author Sarah Harvey added:

'PCTs have a key role in leading and co-ordinating these discussions in their local health economy. They must develop a framework of priorities that reflects both needs and evidence about where savings can be made.'

Read the final report: Windmill 2009: NHS response to the financial storm

Notes to editors: 

  1. Windmill 2009: NHS response to the financial storm by Sarah Harvey, Alasdair Liddell and Laurie McMahon is now free to download.
  2. Windmill 2009 is named after the 'Rubber Windmill', a simulation process developed in 1990 by Laurie McMahon and others at the Office for Public Management for East Anglian Regional Health Authority to explore how the health service was responding to the internal market being developed at the time. The Windmill approach is a way of looking at the future that is ‘soft’ rather than 'hard' because it relies on using the combined experience and judgement of real players in the system rather than by extrapolating quantitative data. It is particularly useful with complex social systems where there are a large number of contradictory forces at work. In the exercise participants are not asked to ‘role play’ but instead take a role that mirrored the one they hold in the real world - meaning their behaviour in the simulation was accurately informed by their real life experiences and insights. This is the second Windmill event and report The King’s Fund has hosted and published, following the previous Windmill 2007: The future of health care reforms in England (also in conjunction with Loop2)
  3. For further information or interviews, please contact The King’s Fund media and public relations office on 020 7307 2585, 020 7307 2632 or 020 7307 2603. An ISDN line is available for interviews on 020 7637 0185.
  4. The King’s Fund seeks to understand how the health system in England can be improved. Using that insight, we help to shape policy, transform services and bring about behaviour change. Our work includes research, analysis, leadership development and service improvement. We also offer a wide range of resources to help everyone working in health to share knowledge, learning and ideas.