Final Report > Chapter 4: The Changing NHS 1984 - 1995 > A series of initiatives > The NHS reforms

The NHS reforms

19 The third initiative to which we draw attention is that represented by what were called the NHS reforms. In 1989 the Government announced a fundamental review of the NHS. This led to the publication of a White Paper, `Working for Patients' [9] which proposed major reforms.

20 The programme of action set out in the White Paper aimed to secure two objectives:

`... to give patients, wherever they live, better health care and greater choice amongst the services available; and

`greater satisfaction and rewards for those working in the NHS who successfully respond to local needs and preferences.' [10]

21 `Working for Patients' confirmed the then Government's commitment to the basic principles of the NHS: a comprehensive system of healthcare financed through taxation and free at the point of delivery.

22 The White Paper did not directly address the question of the perceived need for additional funding for the NHS. Instead, it concentrated on the need to make the NHS more efficient. Providing increased funding was not seen by the then Government as the answer to the NHS's needs. Instead, what was required was a framework which would raise the performance of all hospitals to that of the best. The framework included:

• More delegation of responsibility for the delivery of healthcare to local level: regional health authorities, health authorities, and hospitals. This was to be achieved through the introduction of the internal market.
• The creation of NHS trusts. This would allow those units which applied to become independent trusts and, as such, to have more control over their affairs.
• Through the internal market, money would follow the patient and go more directly to where the service was delivered. This would allow purchasers to make better use of the funds available, so as to secure a comprehensive range of high-quality services.
• The establishment of 100 additional consultant posts to reduce waiting lists, improve the service, and reduce the long hours worked by junior doctors.
• The introduction of general practitioner fundholding (GPFH). This allowed GPs to hold budgets with which to purchase a defined range of services for patients.
• Reforms to the regional health authorities (RHA), district health authorities (DHA) and family practitioner committees (to be known as family health services authorities (FHSA)). The membership was to be reduced, and representation of the local authority removed. The authorities, like trusts, were to have both executive and non-executive directors. The family health services authorities were to have general managers and were to be directly accountable to regional health authorities. Community health councils (CHC) would continue to represent the interests of the patient.
• At a national level, the Supervisory Board within the DoH was to be replaced with a Policy Board, and the Management Board became the NHS Management Executive (NHSME).
• There were to be improved audit arrangements and the Audit Commission would in future be responsible for auditing the financial accounts of health authorities.
• Medical audit was to be extended throughout the NHS. [11]

23 The NHS reforms moved forward rapidly. The NHS and Community Care Act received the Royal Assent in June 1990. The new RHAs came into being on 26 June 1990, followed by the DHAs and FHSAs on 17 September 1990. On 1 April 1991 the `Working for Patients' reforms came into operation. Fifty-seven provider units (including the United Bristol Hospitals) became trusts. Three hundred and six general practices became GPFHs.

24 Shortly thereafter, however, the Government announced that the pace of implementing `Caring For People', that part of the statute concerned with community care, would be slowed down and phased in over a three year period. This provided the NHS with much needed breathing space to accommodate the scale of change which the reforms represented.

25 While the language was that of the market, the reality of the relationship between trusts as providers of services and health authorities as purchasers was, in effect, that of a managed market at best. As Professor Klein put it: `purchasers became commissioners: a recognition that monogamy, rather than polygamy characterised the internal market, with most purchasers and providers locked into permanent relationships in which each partner sought to modify the other'. [12]

Footnotes

[9] Department of Health.`Working for Patients.' London: HMSO (Cm 555)

[10] WIT 0159 0497 - 0498 Miss Evans

[11] Department of Health. `Working for Patients'. London: HMSO (Cm 555)

[12] Klein R. `The New Politics of the NHS' (third edition) London: Longman, 1995