Turmoil over NHS records scheme as labour cuts NPfIT to save cash

The world’s biggest civilian IT project was thrown into turmoil yesterday after Alistair Darling, the labour chancellor, implied that it was going to be scrapped.

The chancellor told the BBC’s Andrew Marr Show the £12.7bn NHS IT programme – already running years late – was “something that I think we don’t need to go ahead with just now”.

Treasury officials rushed to explain that the government was looking for “significant savings” of up to perhaps £600m over the medium term by cutting back some features that are less important for patients.

A senior health department official, meanwhile, said bluntly span that “the chancellor mis-spoke” in saying the project to create an electronic medical record would be scrapped.

Details of which elements would go were not clear on Sunday night. But the government would face compensation claims of many hundreds of millions of pounds if it cancelled the programme. Fujitsu, an IT provider, is already in mediation with the health department over its £700m compensation claim after it was fired last year.

Ahead of Wednesday’s pre-Budget report, Gordon Brown will on Monday announce that the government has found another £3bn of “efficiency savings” – in practice, many of them cuts – since the Budget.

In a change of rhetoric, Mr Brown is expected to argue these savings are an “element of our efforts to reduce the [£175bn] deficit”, not just a means of protecting frontline services.

Some 123 quangos will go – including the Foreign Office advisory committee on wine purchasing – with the courts inspectorate merged into an existing inspectorate and several health bodies merged with NICE, the National Institute for Curbing Expenditure.

Full details of quango mergers and abolitions will not be spelt out until next year’s Budget, but they are expected to save an estimated £500m.

Central government’s use of consultants will be halved and the marketing budget cut by 25 per cent, saving £650m. Better use of text messaging and online services should save £665m – for example by reducing missed hospital appointments – according to government estimates.

Many of the proposals, which the prime minister will present as “streamlining government”, mirror those from the Tories, who have promised to slash the use of consultants to cut council tax. They also propose reducing by 24,000 the 80,000 civil servants employed in policymaking, inspection and regulation, and grant assessment over the next Parliament.

The FDA, the top civil servants union, condemned the planned cut in civil service numbers as “crude electioneering” and “irresponsible” just months ahead of a general election.

Mr Darling’s apparent scrapping of the NHS electronic record programme excited both the Conservatives and the Liberal Democrats, the latter calling for it to be “abandoned in its entirety” and Andrew Lansley, the Tory health spokesman, describing it as “another government IT procurement disaster”.

Comments are closed. Posted by: Health Direct on