NHS England – a product of the Health and Social Care Act 2012
The establishment of NHS England (NHSE) to undertake functions previously the responsibility of the then Department of Health (now DHSC) took place 13 years ago, following the enactment of the Health and Social Care Act 2012 – primarily the result of policies of the secretary of state for health at the time, Andrew Lansley. The act aimed to decentralise decision-making and create a market-driven approach to healthcare. The legislation sought to empower local Clinical Commissioning Groups, by reducing high-level nationwide interference with local healthcare needs, whilst encouraging competition and improving service quality for patient care.
Under the reforms, NHSE took on the responsibility of service commissioning, managing the NHS budget, and ensuring nationwide healthcare standards. The organisation has since played a key role in overseeing digital innovation initiatives, including the rollout of Electronic Patient Records, with more than 90% of trusts now having one in place; as well as the development of the NHS App; and virtual ward services in many NHS trusts. Behind the scenes, brilliant teams of staff have been working tirelessly to bring these and other services to reality. Nonetheless, critics of NHSE have argued that the system had become too fragmented, with excessive layers of bureaucracy affecting innovation and slowing down decision-making.
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Reasoning behind the restructure and consequences
The official rationale behind the decision to abolish NHSE is “to streamline NHS operations and reduce inefficiencies”. The Labour government has (repeatedly) stressed its significant concerns around the duplication of managerial roles between DHSC and NHSE. The government believes that by bringing the organisation’s leadership back under ministerial control, it can improve accountability, remove duplication, and ensure that national healthcare strategies align closely with political priorities. Furthermore, this move is said to be a part of the government’s broader agenda to reduce the number of quasi-autonomous nongovernmental organisations. By abolishing the organisation, DHSC aims to cut administrative costs and eliminate redundancies in healthcare management. The government also believes that by removing NHSE, the local hospitals, general practitioners, and Integrated Care Boards will have more freedom to utilise their budgets and implement solutions tailored to local needs. The restructuring aims to save up to £500m ($646.55m) by reducing workforce and administrative costs. It is proposed to reduce the current combined headcount of NHSE and DHSC (approximately 18,600 staff) by 50%, which came as a shock to everyone, especially the NHS staff directly affected. Importantly, the transition will not happen overnight, with Wes Streeting citing a timescale of two years for the transformation to happen. During the transition period, effects such as disruption in decision-making, confusion about leadership structures, the state of commissioning processes, as well as workforce uncertainty are expected. Further negative consequences may include the loss of significant expertise of NHSE staff gained through years of experience in managing healthcare projects. Structural changes of this scale may also affect the way services are being delivered within the healthcare system. While there is an expectation that patient services will improve, the two-year transition period may lead to challenges in resource allocation and overall treatment delays.
Despite this, the government wishes the reconfigured system to make faster and more efficient decisions, ultimately benefiting patients. Under the new structure, NHS decision-making will be directly accountable to DHSC, aligning healthcare policies with national priorities. Furthermore, without NHSE as a separate entity, there is hope that the NHS, social care structures, and public health services will work closer together. This, in turn, is intended to lead to better patient experiences, particularly for those patients affected by long-term conditions and requiring multiagency support.
Wes Streeting’s message to the public
Last week, leading data and analytics company GlobalData’s public sector health analyst, Kateryna Loievska, attended the Guardian Live event with the Secretary of State for Health and Social Care Wes Streeting, where he outlined Labour’s priorities for a healthy nation, as well as answering some complex questions around the recently announced abolition of NHS England.
During the event, Streeting acknowledged the significant and daunting effect of restructuring on jobs but argued that the system has too much bureaucracy and not enough frontline capacity: “There are lots of jobs hanging in the balance and I am not dismissive of that, but I hope that people recognise why are we making these changes, and that the changes are needed… ”. As outlined a number of times before, the government reportedly studied two head offices (NHSE and DHSC) and could not justify the amount of duplication that persists.
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By GlobalDataAsked about private-sector involvement, Streeting was clear: the NHS must stay public. However, he defended using private hospitals to reduce backlogs – provided it comes at no cost to patients. He also dismissed the idea of European-style payment models, stating that poor management, not lack of funding, is the NHS’ core issue.
Throughout the discussion, the secretary of state was passionate and pragmatic. His focus on reform as much as investment set a clear direction for Labour’s NHS strategy. While his shift towards structural changes raised some scepticism – the commitment to a stronger, more accessible health service was evident. His ultimate goal? A national health service that is there for you when the public needs it.
Health-tech in focus
Although the full scope of effects of the NHSE abolition on ICT contracts in healthcare remains unclear, the restructure may present new opportunities, as government officials continue to re-emphasise how crucial the process of health service digitisation is. Early in his announcement of the restructure, Sir Keir Starmer pointed out that tech will help enormously to support the change needed: “… pushing forward with digital government reform will allow us to deliver massive savings in the public sector. With AI being a golden opportunity, we are determined to seize and get the best of the best in the field”.
The prime minister then turned to wider questions of Whitehall reform, claiming that digitisation could help achieve savings of £45bn across the public sector. Furthermore, according to Streeting, the reformed health administration is now tasked with realising the untapped potential of the health service, as a single-payer public service, becoming a “better customer to medical technology innovators, to get the latest cutting-edge tech into the hands of staff and patients”. During the Guardian Live event, Streeting appeared to be incredibly passionate on the topic, mentioning the great promises of tech du jure – AI, big data and machine learning. He also stated: “… one of the things that makes me optimistic is how much of bureaucracy and admin can be automated [with technology and innovation], so the staff have a better time at work, and patients have a better user experience”. Overall, decentralisation could lead to greater procurement flexibility, with more decision-making power shifting to integrated care systems and regional NHS bodies.
