Yorkshire NHS bosses pay consultants £1m to draw up cost-cutting plans

A hospital ward. Pic: PA
A hospital ward. Pic: PA
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Private consultancy firms have been paid over £1m to draw up controversial cost-cutting plans for Yorkshire’s health service.

A total of £1.08m has been paid by local health bosses largely to two companies to draw up five-year Sustainability and Transformation plans across the county.

The proposals are designed to detail ways in which a £2bn savings gap in health and social care services across the region can be filled.

South Yorkshire and Bassetlaw paid out the highest amount, giving almost £480,000 to consultants.

The payouts included £148,057 paid to accountancy firm PricewaterhouseCoopers (PwC) for work which included drawing up a ‘financial and activity model’.

Another £237,339 went to a company called Attain which specialises in ‘service transformation’.

Will Cleary-Gray, director of sustainability and transformation for South Yorkshire and Bassetlaw, defended the use of the outside agencies.

He said: “The majority of what we do is providing frontline services to people.”

Mr Cleary-Gray said consultants had helped with drawing up the plans and were able to share ‘best practice from working around the country’.

“They bring some of the expert skills we don’t always have. The support was to develop a set of ambitions to articulate a better future. Because we are meeting local needs, what they bring us is shared experience from elsewhere and best practice.”

For the STP area of Coast, Humber and Vale - covering health organisations in parts of North and East Yorkshire, as well as North Lincolnshire, almost £370,000 was paid out to consultants.

A total of £228,244.46 went to PwC, with £128,604.88 being paid to Attain. A third company called Gibson Freake Edge was paid £11,003.06.

In West Yorkshire and Harrogate, Attain was paid a further £241,921 for their services.

Rob Webster, West Yorkshire and Harrogate STP Lead, said the contract with Attain has now ended but defended the use of the consultants.

“Attain were commissioned on a short-term, interim basis, to work alongside existing NHS staff as we had a short time only to deliver a draft set of proposals. It’s important to note that this was never a long-term solution to supporting collaborative working or the STP. Attain have worked closely with existing staff to build both capacity and capability to take forward the work of the STP, so that it becomes very much part of everyone’s day job.

“The importance of providing a solid foundation for positive collaboration on the STP cannot be underestimated. It is imperative we have strong leadership across the whole of the system and harness the expertise, knowledge and skills of our staff, Health and Wellbeing Boards, local political leaders, Healthwatch, the public and communities.“

Across the country, lucrative contracts worth more than £18m in total have been handed out to management consultants involved in drawing up STPs for different areas.

The plans will see an estimated £22bn slashed from health budgets in England as government funding falls below the cost of providing services.

The country was divided up into 44 STP areas which have been drawing up plans to merge A&E and maternity departments, reduce beds and downsize hospitals between now and 2021.

The figures show that London-based professional services giant PwC, which last year had global revenues of £29bn, was the highest paid private firm, winning contracts worth £5.7m.

FOI requests have revealed that many of the STPs were only produced to the deadline set by health services after executives brought in outside consultancies to make up for shortfalls in expertise and staffing.

Information provided by each of the STPs shows that three out of four of 44 areas used private consultants.

Among the highest spenders were North Central London, which spent £2.3m on advice and input from 15 separate external organisations. Staffordshire STP spent £782,000 on services provided by KPMG while the South East London STP spent £1.3m on contracts with PwC.

The total bill across 37 STPs which provided data for their spending on outside consultancies was £17.48m. Alongside PwC, two other global professional services companies were paid the highest sums - KPMG £1.56m and McKinsey £1.37m.

Health think-tank the Kings Fund has reported that such extensive use of private management companies has caused disquiet among senior health service clinicians and executives. In some cases, managers felt pressured to increase their spend on the private companies.

In a report on the issue, the Kings Fund said: “Some leaders felt that STPs had ‘created an industry’ for management consultants - and questions were raised about why money is being invested in advice from private companies instead of in frontline services.

“In one area, STP leaders even felt under pressure from NHS England’s regional team to increase the amount of money they were spending on management and consultancy support. One leader told us they were ‘picked out’ for not spending enough on their STP programme, compared with other STP areas in the region.”

The British Medical Association, which represents doctors, also criticised the spending.

BMA council chair Mark Porter said: ‘It is outrageous so much vital resource is being handed to consultancy firms for their part in delivering STPs which, ultimately, may never come to fruition.

“These figures are especially concerning given that everyone can see a huge crisis unfolding within our health service. The NHS is at breaking point, with record numbers of trusts and GP practices raising the alarm to say they already can’t cope, and while frontline staff struggle to provide safe patient care in a service increasingly becoming unfit-for-purpose.

“NHS Improvement has already admitted that it will pick and choose the parts of the plans it can actually put into action, which leads me to question whether all of this money handed out to private companies will simply be completely wasted.”