Jim Mackey: 2018 - a crunch year for the NHS?

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Following the Chancellor's Autumn Budget 2017 announcement, Jim Mackey discusses the prospects for the NHS in what promises to be one of the toughest years in its history.

This presentation was recorded at a breakfast event at The King's Fund on 5 December 2017. 

Transcript

I was trying to change the way I think again from being a chief executive of a national body to a provider again.  I don’t think it makes that much difference so I’m just going to ramble a little bit about how I saw the budget and how I see it now as a provider.  

So I think first of all, think of the context.  So, really strange economic circumstances, really challenging economic circumstances for the UK economy.  The Brexit thing is a huge issue, wherever you are, it’s just a massive issue.  It’s a massive unknown and variable that economists and the treasury would rightly be very concerned about.  So on Siva’s points about this is only a two year deal etc. etc.  No-one can plan more than a few months at the minute so we’re never going to get a kind of very long-term deal because that’s just not possible anyway.  

The NHS has been recognised as a big priority and a huge risk, financially and economically and it does worry the national government when they see the sort of numbers we’ve got moving around and the complexity and risk associated with that, and then there’s a huge bit about where is the political prioritisation in all of this, so in the context of Brexit and the money and etc. etc. you can see how it’s quite hard to prioritise and make sure we all get what we think we need, which has by the way never happened and I can see a lot of people in the room who have been around a long time.  If you think in the really good old days with massive growth, none of us ever felt it was enough.  I remember years of 6, 7% growth where it was absolutely horrendous.  So as an FD, some of my worst years were in those years where we were getting massive growth, but we’re actually massively over committed.  So you get 6% growth with a commitment to do things that actually accounted for a 10 or 11%.  So I’ll come back to that. 

We set off actually trying to secure a handful of things in the autumn statement so the first one and the big one was, get the pay award funding.  Talking to provider colleagues in the running to the autumn statement, that was the big thing I think that if it hadn’t happened would have meant everybody give up.  It was such a huge number, such a big variable, had such a big psychological impact, if the pay award hadn’t have been funded we would have just been looking at huge numbers and I was really clear that most people would have just thrown the towel in a that point, and as Siva said, it’s the only part of the public service that’s getting a pay award funded.  If you do talk to people in other sectors, they are very angry and upset about what we’ve managed to secure.  

We all wanted to see some recognition of the deficit and get us back to a time that felt more reasonable in terms of stretch.  We wanted to see some money for capital and that’s been at least partly met, and we wanted to see some money to restore basic standards, mainly constitutional standards which would in turn allow investment in cancer, mental health, primary care etc. etc.  

So, perhaps not absolutely all of those thing got delivered, but they were never going to get delivered, it was never possible to get all of those things delivered, and you’ve got to understand as well, if we was to be in a room that are running big organisations the dangers of giving in to special clearing and at no time if you’re a chief exec or chair have you ever had a budget discussion with any of your business units that says you can have what you want and tell us what you’re going to do with it later on.  When has that ever happened?  It’s never happened, has it.  If it has you’ve probably got a huge deficit.  You know, I think we just need to be a bit realistic about all that but the key in all of this is what do we do with it?  What marginal value can we demonstrate with the extra money?  It absolutely does not do everything that it’s supposed to do, but it also isn’t the case that we can’t do anything and what we need now is to get into a place where we can demonstrate that we’re going to make as much benefit of the money as is humanly possible, stretch every sinu, demonstrate that we’ve got resource and be ready for the next negotiation. 

And on all of that, the big thing that we all probably worry about is the psychology of all of this.  We’ve talked ourselves into a very negative place in the last few weeks, all of us for you know different reasons and good reason, but we need to still deliver things.  The NHS is a huge organic entity, all of our people are feeding off the negativity.  At some point we’re going to have rally behind a negotiated position where we know what we’ve got to do and frankly do our best to deliver it.  

So I think on balance, I’m still more half full in that we’ve got investment that other people haven’t got and we had no chance of getting a few months ago.  Key now is negotiating what we can actually deliver with it and then actually delivering it.