But while he eschewed the glamour of big business, he and his NHS colleagues are no less important than private sector managers.
The health authority’s director of finance and his team will oversee the spending of £434m of taxpayers’ money this year. It’s cash that will be spent on operations, nursing care, vaccinations and hundreds of other treatments.
Also, for 12 months from the beginning of December, Millar will become chairman of the Healthcare Financial Management Association (HFMA), leading finance staff across the country who will see £40bn pass through their hands over the year.
HFMA members are always there to ensure patients get value for money from each pound spent – but, in the coming year, they must also implement the government’s new 10-year NHS strategy, the NHS Plan.
The health service is at a crossroads: it’s 52 years old and has been through umpteen reconfigurations, reconstructions and relaunches in the past 10 years. The NHS Plan will begin to re-engineer publicly-funded healthcare in England (Scotland, Wales and Northern Ireland are carrying out separate reviews) and, the government hopes, regain public confidence. It pledges an extra 7,000 beds by 2004 and 9,500 more doctors and 20,000 more nurses by 2005. By the same year, patients should have to wait no longer than six months for an operation.
The plan is being backed with a government promise of £19.4bn of extra spending between 2000 and 2004. It is an ambitious programme and, despite the extra money, implementation will be tough in a complex service that has one million employees, 99 local health authorities and more than 400 semi-autonomous health trusts.
The NHS has fundamental problems. Waiting lists, though not as long as they were, are still unacceptably high; the service has an accumulated debt of around £700m; and there are shortages of doctors and nurses at a time when demand is rising by at least 10% a year. But the prime minister has called on the NHS to become ‘a 21st century service industry’, more in keeping with 24-hour telephone or internet banking services than their traditional High Street counterparts.
The NHS paradox
‘You have this paradox. On one hand it has never been easier, but on the other it has never been more difficult,’ Millar says. ‘We have been given the numbers over the next three years in terms of resources and there is no doubt that it is a generous level of additional resources. But, however much money is being put in, it is never going to satisfy everybody. So whether it is new drugs, the level of nurses’ pay, waiting times or new technology that you want, there is not going to be enough money. However, there is money to make progress, and the NHS Plan has signalled to us where the government wants us to get to. But what I have yet to see is any realistic reconciliation between where we are trying to get to in terms of targets and time-scales relative to the extra money.’
Millar says accountants will be in the front line when it comes to ensuring the extra money is spent wisely. One of their priorities is to strengthen balance sheets – but this would be difficult to sell to the public and politicians. How could the health service, which has been complaining about underfunding for years, show a surplus when waiting lists are still long? ‘While we can understand the surplus technically, it is never going to be an answer that the public is going to be assured about,’ Millar says.
Public pressure and discontent with the NHS is a growing factor. ‘We have always had local pressure with health authority and now trust board meetings open to the public. All the local decisions have been made in public but it?s only relatively recently that on top of that we also have national pressures in the form of waiting times targets. We are now in a position where we are caught between the two,’ he says.
He acknowledges that commercial operations face a different set of pressures. ‘We don’t have to worry about the income generation side of things,’ he says. ‘Our job is to get the best value out of the money available, hit our targets and work with professionals who are not directly accountable to us and who make the operational decisions that consume the resources. Quite rightly, when a doctor has a patient in front of them, they can’t be concerned about the cost of the treatment. However, doctors and managers collectively have to be concerned about the costs of treating patients.’
Spend, spend, spend?
But with so much extra cash starting to arrive in NHS bank accounts the atmosphere of ‘spend, spend, spend’ could become feverish to the point of recklessness. Accountants may struggle to be heard, Millar says. ‘There is never quite the same rigour of challenge when you are spending more money as there is when you are trying to make savings. The challenge the government has set for the NHS isn’t just about spending the extra money it’s about changing where the existing money is spent as well. There is a danger we will focus only on the extra money.
‘If you are in financial difficulty you want the help of your accountant but if you don’t perceive yourself to be in financial difficulty then you see accountants as getting in the way. I am worried about what proportion of the extra resources is going to be wasted. Sometimes, the accountant has to be the realist at board level and therefore also at HFMA level; they have to be the one who stands up and it can be quite lonely doing that.’
As every accountant knows, telling the truth, however uncomfortable that may be, is an important part of the job. In the politically-sensitive NHS, discomfort can be a way of life and the HFMA is no stranger to the role of the messenger with bad tidings. Last December, for example, the association published a survey of finance directors that predicted the NHS would overspend by £200m in 1999/2000 – a message a government worried about public perception of its handling of the health service was not happy to hear.
Although the association would take a more softly-softly approach to publishing such a survey now – perhaps informing ministers in advance – and is working closely with the NHS Executive, the Department of Health’s management arm, Millar reaffirms the HFMA’s commitment to speaking out.
‘I would be the first to say there are lessons to be learned about the way the survey was handled, but at the end of the day accountants have a professional and statutory responsibility. The HFMA and its members are committed to working within the NHS, with the NHS Executive, and getting the best results for the NHS. But we also reserve the right to make public statements. We have a public responsibility to tell it as it is – that’s a fundamental element of the HFMA.’
Paradoxically, the HFMA’s willingness to issue warnings of financial problems has not led to a new public respect for its members. While their colleagues in commerce or public practice are often accused of being a bit dull, a different level of vitriol is reserved for NHS accountants. They are blamed for blocking operations, closing wards and under paying nurses and, although the level of accountant bashing has fallen in recent years, Millar knows its return is never far away.
Committed to the NHS
‘There is a perception that the only people who are committed to the NHS are frontline doctors and nurses, whereas I would argue that the majority of finance professionals in the NHS are at least as committed to the health service as these staff. This is evidenced by the fact that most of them could earn more money by working outside the service.
I get annoyed when ministers and the media think that if you are not a doctor or a nurse, and particularly if you are an accountant or a manager, that you are somehow not dedicated.’
He admits this perception can affect morale, which is always important in a service that runs on the goodwill of its staff. ‘Having been in the service for 25 years I am thick-skinned enough about it, but when you are developing your career and working extremely hard to deliver support services and infrastructure that care depends on, it can be dispiriting. People do work extremely hard and work longer hours than they are contracted for. I am not sure that it is more or less prevalent than in other sectors but it is evidence of their dedication.’
Like many of his peers in the public sector, Millar joined straight from school. With a leaning towards accounting as an 18-year-old, he sought a job with his native Scunthorpe’s biggest employer. ‘I applied for a sponsored university place with British Steel. Then we saw an advert for A-level entry for finance trainees in the NHS. So I applied as insurance in case my grades weren’t good enough. The inevitable happened – I was offered the job and my grades were good enough but I opted for the NHS. My mum was a nurse but she died when I was 12, and I suppose because of this I saw it as an interesting and worthwhile job.’
Millar moved through a succession of NHS jobs, increasing his responsibilities with each one.
Modestly, he says he was able to move so quickly because he was ‘reasonably intelligent, applied myself to the job and was prepared to relocate’. Eventually, he found himself at Berkshire Health Authority as deputy treasurer.
‘I was a heartbeat away from the treasurer’s job but my only experience was of the NHS, so I stepped out of the service, though it was never with the intention of turning my back on it completely.’
The Post Office
He joined the Post Office in Oxford, which was then recruiting qualified accountants into local offices for the first time. ‘I spent three years there, which brought several things home to me. One was that, although the targets were different, a lot of management issues were the same. Secondly, I didn’t identify as well with the targets in the Post Office as I did in the NHS. One of our targets was the percentage of first class letters delivered next day. For me that wasn’t as important as seeing patients going through outpatients or going down to surgery.’
Millar went back to the NHS, initially as a consultant, then as finance director at Ipswich Hospital NHS Trust, before taking up his current job in 1995. He has always been active in ACCA and the HFMA and believes them to be forces for bringing together NHS finance staff with the common aim to improve services to patients.
The need to include all interested parties led the HFMA to end its close association with CIPFA, the public sector accountancy institute, around three years ago, although its offices remain in CIPFA’s London headquarters. ACCA and CIMA train more health service accountants than CIPFA, so it seemed logical to loosen the ties. And, as HFMA celebrates its 50th anniversary over the next 12 months, Millar will become its first chairman not to hold the CIPFA qualification.
‘I was genuinely surprised when I was nominated to become chairman elect and therefore chairman. Clearly it is a great compliment,’ he says, before insisting that the move away from CIPFA was not a negative decision. ‘If you start from the point of view that the HFMA is a trade organisation, not a professional body like CIPFA or ACCA, then what it needs is a positive relationship with a range of other people – including professional bodies. It can’t do that if it is perceived to have a strong link with just one professional body. This isn?t about severing the relationship with CIPFA; it’s about having the same relationship with all the CCAB bodies.’
Since the change, the HFMA has been reinvigorated. Millar believes it must now widen its role in helping members develop their careers to meet the challenges presented by the new NHS Plan. A recent consultation paper from the NHS Executive on finance staff development virtually takes their accounting skills for granted but points to the need for accountants to gain new talents.
‘Most of these will be in areas such as giving business advice, performance management and negotiating and influencing skills – the wider management or, if you like, the softer skills. These form part of the CCAB bodies’ syllabuses to a degree but they are not at their core,’ Millar says.
‘If you are an accountant in the NHS you have a responsibility to keep your technical skills up to date. Some of these are generic and the best people to deliver this training are the CCAB bodies. But at the other end of the spectrum it’s important to keep pace with the changing environment in the NHS, and that has to be led by something that abuts the NHS. That’s the HFMA’s role. In the middle there are time management and negotiating skills, which the HFMA should be doing in conjunction with the CCAB bodies.’
Millar is optimistic about the future, both for the HFMA and the NHS. ‘I think that we should not under-estimate what the NHS delivers now compared with what it delivered 10 years ago in terms of the range and volume of services. I find the NHS Plan extremely helpful. It says all the right things and in terms of the direction and commitment for the future. I am 100% behind it.’
Even so, there are major challenges ahead.
‘What I don’t under-estimate are the difficulties in getting there because I do accept that the NHS is slow to change and there are difficulties with the planning cycle in terms of how long it takes to deliver new projects. I believe the major constraint will be the availability of trained staff in the next three years at least. This is my biggest worry. If I were the government, I would be maximising the amount put into recruitment and training because if we don’t get that right we are not going to deliver the improvements and we are not going to be able to deliver the NHS Plan.’
As Millar stresses, NHS accountants are, like him, 100% committed to implementing the new strategy – but they are not afraid to point out things that are going wrong.
This article first appeared in Financial Director magazine.
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