What lessons should the coalition government learn from New Labour's market reforms?

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With opponents of the NHS reforms marshalling their forces for the debates in the House of Lords, much of the government's energy will continue to be focused on convincing political dissenters of the merits of its plans.

A major new book published by The King's Fund today suggests the government must not forget the importance of engaging with the implementers, who will ultimately shape how these grand ideas work out in practice.

Leaders in the NHS remain unconvinced about the government's plans. An Ipsos MORI survey of public sector leaders over the summer found that only one in three health leaders agree with the reforms and one in four believe that they will improve services. Their key concern is funding (63 per cent cited this as the most important factor facing the health sector today).

Many of the same fears raised in response to the present government's plans were voiced about the market reforms introduced by New Labour from 2002 onwards. Having initially rejected the Conservative's internal market, the Blair government introduced patient choice of provider, created a greater role for the private sector in providing NHS-funded care, and gave public hospitals greater freedoms as foundation trusts. Our new book – which includes chapters by many of the leading experts on health policy – reviews the evidence on the impact and implementation of these policies.

We find that these reforms went much further in introducing market competition into the NHS than the Conservatives' internal market in the 1990s. The fears voiced about the reforms were largely not realised, but their impact was also more limited than their proponents had hoped.

The government would do well to pay more attention to implementation if it wants its reforms to have a greater impact. We suggest in the book that the coalition government should:

  • have a strong narrative and make sure the purpose of the reforms is clear to those responsible for implementing them
  • be open to adaptation and refinement of policies in response to feedback from implementers
  • expect the reforms to be diluted during implementation and therefore give them a decent chance to work
  • recognise that 'context matters' and the market may have limited application beyond elective care
  • not assume that passing new legislation will change the behaviour of those within the system; active steps will be needed to change managerial cultures and relationships.

Ultimately it will be NHS leaders and not politicians who determine whether the NHS is able to deliver the changes anticipated by the reforms. The politicians would do well to remember this.


Nate Taylor

External Relations Coordinator,
Black Hills Area Habitat for Humanity
Comment date
23 September 2011
Great Policy Stuff.

Ken Usman-Smith

Non Executive Director,
Castlemere Community Centre
Comment date
03 October 2011
But the debate should not simply focus on Government and opposition but the third sector must have a role as well. Partnerhipos must be amongst equals and historically government is parant child fixated when communities can actually add vale to the debate. After all we are the end users and the outcomes in this arena, government is simply about outputs.

Paul Worthington

NHS Programme Manager,
Comment date
11 October 2011
Interesting work - the thesis that implementation can change the dynamic of policy is absolutely spot on, and implementation has in the past acted as the saving grace or amender of poorly conceived policy.

Equally, the 'context matters' point is critical. Many of the arguments about competition have focused on elective care, often big city elective care. The NHS White Paper and Bill (and attendant debates) have frobably focused too much attention on it. But it's arguable that the real focus for change should actually be on other areas; long term conditions, emergency admissions, developing community social/health infrastructure. These areas are possibly where change is most needed

And a response to Ken Usnan-Smith - I think you may be highlighting one of the major problems the third sector faces. Are you really the end users, as you claim ? Surely that's patients and communities ? Yes, sometimes the third sector serves as advocates, the patient voice or pressure group. But sometimes its solely a service provider. There's a difference there

ken Usman-Smith

Non Exec Director,
castlemere Comunity Centre
Comment date
20 October 2011
Good point as we are both end user advocates and increasingly service providers.
The shift happens debate underlines that Councils are now focussed on statutory only and the 3rd sector is expected to bridge the gaps left as they disengage from community focussed budgets that are cut. they are all 'consulting' on those cuts now, not if we cut off your oxygene but by how much. The imapcy on the patient will still critical.
Core funding goes, staff redundancy taks out the reserves ( if you have any) and the SLA services that are evidence that you went out and operated as a business (as you should) are disappearing as the tender proces in 2012 draws in the big boys.
The result is a Big Society launch to an empty room.......

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