Central controllers could squander NHS windfall

The £1bn of extra funding for NHS IT outlined in last week's budget and the Wanless Report, which could become one of the largest...

The £1bn of extra funding for NHS IT outlined in last week's budget and the Wanless Report, which could become one of the largest IT investment programmes ever seen in the public sector, could be wasted if the Department of Health controls spending centrally, according to NHS IT experts.

Last week's budget saw the chancellor Gordon Brown announce the largest ever sustained increase in NHS funding, with spending set to rise from £65.4bn in 2002/ 2003 to £105.6bn in 2007/ 2008. Brown also agreed with the findings of the Wanless Review, which called on the Government to devote £2.2bn to NHS IT in 2003/2004. Current NHS IT spending is £1.1bn.

The government-commissioned Wanless Review was set up in March last year to identify the resources that will be needed by the health service over the next two decades. In addition to increased spending, it also called for funding to be ring-fenced for specific IT projects.

However, Murray Bywater, managing director of IT healthcare specialist Silicon Bridge Research, urged the Government to adopt a devolved approach to implementation on account of the sheer scale of the NHS, which, with 1.1 million employees, is one of the largest organisations in Europe.

"It is not feasible to implement all systems centrally in an organisation as large as the NHS, particularly the ones that relate to local business processes," he said.

The report also identified areas such as IT infrastructure, staff training, clinical governance support systems and electronic patient records as having a crucial role to play in the health service's future.

Former NatWest group chief executive Derek Wanless paints a depressing picture of health service IT in his report, describing the UK's "particularly poor record on the use of information technologies in the health service". He also found that the health service's annual IT spending per employee was lower in 2000 than in any of the other sectors of the economy he looked at.

The NHS is no stranger to IT problems. In the early 1990s a centralised approach to IT delivery hit the Hospital Information Systems initiative, losing up to £103m and prompting criticism from the House of Commons Public Accounts Committee.

Experts have highlighted some of the risks inherent in a major IT overhaul of an organisation such as the NHS. Ian Lynch, management consultant at public sector IT specialist ZMS, believes the health service will have to get its core technologies right if future IT strategies are to deliver results.

"Defining the core technology standards at the outset is absolutely critical, if they don't get that right then the whole thing will be a mess," he said.

A spokesman for the Department of Health said it is currently looking at a new programme for managing IT across the NHS, but was unable to specify spending plans.

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