NHS faces purchasing 'value' probe

2 October 2002
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03 October 2002 | Robin Parker

Government procurement advisers are to investigate the NHS's £10 billion annual purchasing spend in a shake-up of its commercial activities.

Brian Rigby, deputy chief executive of the Office of Government Commerce (OGC), is to conduct a six-month review on how to make procurement more co-ordinated and efficient.

Rigby told SM: "We need to sit back and have a proper review of health acquisition activity, which has historically been dispersed between units including the NHS Purchasing and Supply Agency (Pasa), the Private Finance Unit and NHS Estates.

"We simply don't know if we're getting value for money and need to determine precisely how NHS healthcare acquisition is structured."

The Department of Health (DoH) is also postponing the appointment of a commercial director to oversee NHS spend.

The post was due to be filled this summer, but the selection process was halted as the department said none of the candidates was good enough.

The review will determine the specification of the position, which will have a wider remit than first envisaged.

Duncan Eaton, chief executive of Pasa, said the use of the specialist organisations' resources needed to be studied first.

"It became clear that the nature of the job might be wider than previously thought, and rather than having to revise things with someone in the post, it seemed more sensible to carry out an in-depth review of long-term needs."

The commercial director, when appointed, will act as a departmental sponsor for the NHS units. The organisations' directors will continue to report directly to the DoH.

Earlier this year, Lord Hunt, the health minister, branded present procurement standards in the NHS as "unacceptable".

The review will address the concerns of NHS staff and suppliers, consider training issues and benchmark against other areas of the public sector.

Pasa has also announced the first six Supply Management Confederations of NHS Trusts, which aim to bridge the gap between national and local purchasing in regional consortia.

Pasa expects the confederations to cut purchasing costs, help to develop centres of procurement excellence and raise the standards of poorer performing trusts.


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