BusinessCompany NewsAll eyes on Milburn

All eyes on Milburn

On the frontline: failure over the NHS could cost Labour the next election. Alan Milburn is the man in the hotseat.

Spare a thought for Alan Milburn. This consummate Blairite is heading for more media and political scrutiny than the prime minister himself, as he is handed surely the most important and onerous task in politics today – the rescue of the NHS.

And while this might, even on Budget day, have looked like a ‘hell of job’, Milburn did have a signed and sealed certainty in the shape of £40bn from the public purse.

In fact, the health secretary emerges from Gordon Brown’s spending announcements as a clear winner in terms of access to funds. He is assured 7.4% net annual increases in spending until 2008 – which makes him worth knowing.

Milburn, realising that he will need the backing of NHS nurses if the service is to show tangible improvements, was quick to announce the recruitment of 35,000 nurses and 400 new hospitals. Union officials responded just as quickly with calls for increased pay.

Within days, the complexity of this task was spelt out by a National Audit Office report. The NAO’s experts reckon the health service will face a bill of £4.4bn in clinical negligence claims and legal costs. But the figure, they say, could reach nearly twice that amount if more ‘possible but unlikely’ claims emerge.

What this report makes clear is that this cash – the penny in the pound the Lib Dems famously argued the British public would be prepared to pay for better healthcare – is to be seriously eroded by a burgeoning clinical negligence liability.

Add to that an estimated £112m fraud cost on a £4bn annual budget and the scale of reforms needed become painfully clear.

Sensitive to the accountability issues of holding this particular purse, Milburn has created another tier of regulation for himself in the shape of a new ‘super-auditor’ for the health service. The new Commission for Healthcare Audit and Inspection is there to reassure voters that this new money is being spent properly.

The Audit Commission will retain its role as district auditor to the NHS, but loses its value for money studies to the new watchdog.

Alan Milburn meanwhile needs to show measurable improvements by the next election. Gordon Brown is a shrewd operator – he takes the gamble and leaves it to Milburn to deliver.

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