NHS needs a hangover cure
By Andrew McNeilis
With an average budget of £186m, it is surprising that only one-third of FDs of primary care trusts (PCTs) are full-time finance directors.
The rest perform multiple roles or work part-time, according to a recent NOP poll of 50 trusts in England. Surely it is only a matter of time before all these roles become full-time?
PCTs are charged with modernising the NHS to give patients more choice.
But greater choice will make financial flows more volatile. As far as financial management is concerned, greater volatility will require greater focus, attention and above all time.
Some FDs look after a number of smaller trusts and some have multiple roles; others simply work part-time. But the prevalence of part-time FDs shows that too many are quite simply being asked to do too much.
Don’t just take my word for it. The Audit Commission’s recent report on financial management in the NHS cited overstretched staff as a key concern for potential financial failure. Overstretching or distracting FDs with other important roles is not the answer.
The NOP survey also highlighted financial pressures as a key concern among PCTs. This surely adds clout to the argument that, as the role matures, there will be a need for a focus on fiscal management, with no distractions.
The reliance on a part-time culture may be a legacy of a time when financial flows were more predictable. It would be unheard of for private sector firms with comparable budgets to suggest to their shareholders that the financial direction of the organisation was a part-time job.
And yet, interestingly, the poll also found that three-quarters of respondents felt that private sector financial experience would add no value and was unnecessary in the NHS. This view must surely be challenged. All businesses benefit from recruiting diverse skills and experiences.
The grass-roots discounting of private sector experience must surely be at odds with the government’s desire to attract private sector talent.
Such an approach will only encourage recruitment from within NHS trusts – in effect, robbing Peter to pay Paul.
- Andrew McNeilis, European commercial director of Hudson.
The best FDs in the world
By Mark Knight
The NOP survey which found that two-thirds of FDs in PCTs were not full-time employees is really rather misleading. Virtually all these so-called part-time FDs are actually full-time staff – it’s just that most of them have additional responsibilities.
Frankly, I was surprised that the figure is as low as two-thirds. Like the FDs of almost all other hospital trusts, those at PCTs rarely have only finance in their portfolio. Like their commercial counterparts, finance directors in the NHS are key players with senior-level responsibilities.
In the health service, they are so important that by law there has to be an FD on an NHS board. It’s only natural that as corporate players they are expected to accept other functions within their portfolios. I’m sure many FDs in industry and the commercial sector would love to concentrate only on finance!
Of course, finance directors in the NHS can’t really win either way, as a sudden expansion of dozens of new senior posts would lead taxpayers quite understandably to ask why. Management costs in the NHS have fallen as a proportion of expenditure since 1997, while there are now tens of thousands more doctors and nurses in the system. This is a tribute to the efficient way the service works, with some of the lowest management costs of any health system in the world.
There is an implied slur on NHS finance in suggesting that many FDs work part-time. The track record of NHS finance directors speaks for itself.
The service has continued to balance its books despite huge cost pressures and structural upheaval.
The Audit Commission’s recent report on financial management did raise concerns about PCTs’ financial management capacity to meet future challenges such as payment by results and patient choice. These are challenges the finance function is well aware of and is preparing for. But the report also noted that the basics of financial management at most NHS bodies are sound and provide effective financial control. The health service’s finances are in good hands.
- Mark Knight is chief executive of the Healthcare Financial Management Association.
Does Darwin's theory apply to taxation? Colin ponders...
The EC has been instructed to draft a European Union (EU) directive authorising an EU financial transaction tax, which would apply to ten of the EU’s 28 member states
Accountancy watchdog the FRC has dropped its investigation into the former chief financial officer of Tesco, nearly two years after the supermarket was engulfed in an accounting scandal
Colin imagines how Apple's logo might change in the wake of the EC's ruling over its Irish tax arrangements