A transformation fund for the NHS

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It is now widely accepted that, in order to meet the challenges facing the health and care system, the NHS will need both to improve productivity and to receive a real-terms increase in funding. It is probably just as widely accepted that this needs to be accompanied by – and indeed relies on – a fundamental change in the way that care is delivered.

NHS England’s five year forward view recognises that the NHS must adapt to a changing world by breaking down the barriers in how care is provided and improving the integration of services. The forward view outlines a handful of ‘radical new care delivery options,’ which local areas will be able to choose from.

But delivering major change is not easy. All too often local services have been forced to introduce change on the cheap – by overburdening local leaders already too busy just managing their day job, by leaving too little time and resource for genuine engagement with staff and the public, or by closing old services before the new ones are running at full capacity. To break out of this model, both The King’s Fund and The Health Foundation have called for a properly resourced ’transformation fund’ to support change in the NHS.

This argument is gaining weight: the Autumn Statement identified £200 million for next year to help establish the models of care set out in the forward view, and this is welcome. However, it still leaves the questions of exactly how big such a fund ultimately needs to be, and even more importantly, how to spend it so that the investment does support real change at scale across the NHS.

Over the coming months The King’s Fund and The Health Foundation will be exploring the concept of the transformation fund in more detail. We hope to address the question about what resource is required and to explore alternative sources of funding. In particular, we will be looking at whether resources tied up in surplus NHS assets and estate could be used – what is the scale of these resources, are they accessible, and how might they be released?

We will also look at past transformation programmes within the NHS, within other health sectors internationally and in other sectors. By examining examples of successful (and indeed, unsuccessful) attempts at transformation, we want to identify the key drivers of large-scale change. This means also understanding the role of factors other than funding: notably leadership, staff, and approaches to setting goals and measuring progress.

One important outcome from the review of past examples of transformation will be the lessons for the administration of the fund. Just as NHS England will need to decide how, when and where to allocate the £200 million outlined in the Autumn Statement, we will need to consider how a future NHS transformation fund should be administered and over what period of time. Some principles are clear – for example, the fund must be earmarked for genuinely transformative change and not be raided to prop up indebted health economies – but others, such as who will host the fund, and whether it should operate at a central or local level, whether it will be given as a loan or a grant, and to whom, are all still open questions.

As we develop our thinking, we will be seeking input from stakeholders across the NHS, national bodies and national and international experts. Look out for further blogs on our progress.

This blog was co-authored by Anita Charlesworth, Chief Economist at The Health Foundation.


les simpson

Comment date
22 December 2014
The repair job required by the NHS as we have seen is a result of poor communication between the department of health and department of education.
People are able to get advice from the pharmacy, but knowledge of this is limited, children are churned out from education ready for jobs only to find jobs are not available. Children could get free exercise as your own info graphs have demonstrated, that give saving and reduce future repair funding in the long term.
Areas of multiple deprivation show prevalence of behaviours that are not harmonious to health and as a result the accumulative effects of these behaviours impact on the Nhs, far too often the Nhs is seen as an escape goat for social ills ...
But what if department of environment gave those in the lower poverty levels solar panels, raised the minimum wage , business shared profit margin more on equal terms to staff.
Health care staff are far too often found on zero hours contracts and minimum wage that is well below a living wage, the health minister announced psychological coordination in job centres to keep people in work , but I say if people receive minimal wage, struggle to live a decent life that they aspire to, or even develop aspirations of a long healthy life in their youth ,would that time and effort be better spent in making sure a penny is given to each member of staff in fairness and respect rather than a speed boat to riches for the boss...
Health care is health share
forward fund demands may be reduced if sharing of profit is done conscientiously

Nigel Jones

Retired teacher, but now a local councillor,
Comment date
21 December 2014
I am sure we must explore new ways of delivering NHS care. In addition to this and to the matter of funding, we need to look at quality of care within and outside the NHS. Improvements in this will not only improve people's lives it can reduce their need to keep on coming back to the NHS. We should also explore the role of volunteers and the third sector in helping both quality of care and quality of life, the latter having the potential to prevent illhealth and reduce the demands on the NHS. Churches in the past used to play a significant part in providing pastoral care, recognising the social and spiritual needs of people alongside the medical needs. We cannot rely on medical expertise alone when dealing with human beings.
Alongside this, I would go for administration of any health treatment and preventative system being carried out locally, not centrally. A great deal of central guidance will be needed, at least until locally based organisations build up the right skills and attitudes, but one of the basic errors in our present system is the heavily centralised administration. A more locally based system will also encourage the use of volunteers on the social and spiritual side, because people are very much more likely to want to help if they can directly feel the need and hear the call from people who live near them and not in Whitehall.

Paul Turton

Solutions Development Manager,
NHS Supply Chain
Comment date
19 December 2014
One area for consideration - the NHS has a significant opportunity to transform the way in which medical equipment is financed & managed - this has the potential to achieve financial savings and improve patient outcomes. The adoption of a strategic "Asset Management" approach has driven whole life cost savings of between 20-40% in other asset rich sectors. Even at a much lower percentage, given that the NHS spends in the region of £1.2bn per annum to replace and manage its medical equipment, the opportunity is significant. Asset Management also emphasises the optimisation of performance and risk. Given that medical equipment is integral to the realisation of world class patient care and the management of clinical risk, a strategic asset management approach can confer significant healthcare benefits. There is a large and growing body of expertise and best practice in asset management to draw from – both within and outside of the NHS. This includes international ISO standards, asset management institutes, regulators and individual organisations. In other words, a blueprint exists for a transformative asset management approach.


Consultant Neonatologist & Prof of Perinatal Health,
Comment date
18 December 2014
By just calling it a 'transformation' fund or a 'better care' fund we don't get transformation or better care! By just throwing money at wicked problems, they don't go away.

It is great that the King's Fund and the Health Foundation are getting together to explore this further. I hope members of the public as well as frontline clinicians are being involved in this.

I would request that more 'thought diversity' be explored in this work.

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