Official Report (Hansard)

Session: 2007/2008

Date: 22 November 2007




Programme for Government/Budget

 22 November 2007

Members present for all or part of the proceedings: 
Mrs Iris Robinson (Chairperson) 
Mrs Michelle O’Neill (Deputy Chairperson) 
Mr Thomas Buchanan 
Rev Dr Robert Coulter 
Dr Kieran Deeny 
Mr Alex Easton 
Mr Tommy Gallagher 
Mrs Carmel Hanna 
Mr John McCallister 
Ms Carál Ní Chuilín 
Ms Sue Ramsey

Professor Roy McClelland ) Mental Health and Learning Disability Board 
Mr Dominic Burke ) Western Health and Social Services Board 
Mr Stuart MacDonnell ) Northern Health and Social Services Board

The Chairperson (Mrs I Robinson):
I welcome Professor Roy McClelland, chairman of the Mental Health and Learning Disability Board. You are very welcome, Roy. You have about 10 minutes to make a brief presentation, and then members may ask questions.

Professor Roy McClelland (Mental Health and Learning Disability Board):
Thank you. I appreciate the kind invitation to address the Committee and to contribute to its consideration of the draft Budget, particularly in respect of mental-health and learning-disability issues. I acknowledge the interest that Committee members have shown in those matters. I sense that I am among friends in facing these challenging issues.

I sense that the Committee is increasingly well informed of the draft Budget and the type of service options with which departmental officials are grappling. The Mental Health and Learning Disability Board is similarly informed, so we are on a reasonably level playing field.

We have major concerns. The two issues that I shall primarily be addressing are our analysis of the implications of the present draft Budget, and a possible constructive way forward. It might be useful if I pause after addressing the first of those matters to take some questions.

It is important to share with the Committee that the board is resolved in its commitment to the proposals of the Bamford Review. The board is independent; it does not work for the Bamford team or the Government. We have looked afresh at the vision of the Bamford Review and the specific proposals therein.

Questions have been raised about the provenance of the series of recommendations that have emerged in the wake of 10 reports. I am conscious that comments are often made in general discussions to the effect that the Bamford Review perhaps did not simply represent a take on the situation, but an overtake — that it overreached and became a wish list.

I had the privilege of being closely involved in the crafting of the Bamford Review, so I am in a position to briefly address that issue. We recognised what the cumulative cost of implementing those proposals could mean for Government and for the community. A committee on needs and resources was appointed to work in parallel with us. That committee included senior officials from the Department and the health and social care trusts, who kept us right in respect of the costs of what we were proposing. The full costs of those proposals were considered.

Some Committee members may have heard me say in other places that, in the long term, if an evidence-based approach to mental health and learning disabilities is to be adopted, a doubling of investment will be required. That will enable the issue to be dealt with in a modern, twenty-first century manner.

We were also conscious that a medium-term approach, as well as a long-term approach, was required to address the issues. Recognising the forthcoming comprehensive spending review, and, indeed, prompted by officers from the Department, we developed a strategic-priorities report, a copy of which I have given to the Chairperson.

That report details the costs and the approach that are required, which I believe are entirely reasonable. That involves taking an equity approach. Given the direct rule context in which all of that work was done, we felt that bringing ourselves up to a par with how the National Health Service frameworks were being addressed in England and Wales seemed a reasonable approach. Secondly, the additional mental-health morbidity rate — which we know is a fact — makes it all the more important to peg down that equity.

Between 2000 and 2006, the British Government invested an average of 6·7% more, year on year, in provision for mental health alone. That represented a 6·6% rise in the budget. They are committing significant additional resources as we speak.

In England, in the early years of this millennium, the baseline of the Health Service on mental health, relative to health generally, was 11·8% of the total NHS budget. In Northern Ireland, 8·4% of the total health budget is spent on mental health, and that remains the case. We considered the equity argument in order to address the inequity over a 15-year epoch. We estimated that £311 million is required. That was against a baseline budget in 2005 of £479 million.

That would represent a lift of 65%. It takes little calculation to show that, over 15 years, that works out as slightly over 4% per annum. Therefore, if we took 4%, or more, per annum, we would address the inequity that was addressed in England with a lift of 6·7% per annum. That is not too much to ask. Effectively, that equates to a lift of just over £20 million a year. However, we recognised that that would be unrealistic in year 1. Therefore, we pitched for £15 million in year 1, £35 million in year 2 and £55 million in year 3.

In fairness, the Department’s bids were very much in keeping with that. Its initial bid was for £17 million, £29 million and £48 million, which the board keenly supported. However, the draft Budget gives us £4 million in year 1, with an extra £1 million for mental health promotion and suicide prevention; £7 million plus £2 million for the same in year 2; and £18 million plus £4 million in year 3.

I am particularly concerned about years 1 and 2. The average lift for those two years is less than 1%. That signals a real risk of stalling the implementation of the Bamford Review recommendations. Not only have 10 reports been written; expectations have been raised and much preparation work has been done. There has been a coalescence of attitudes and minds among the professionals, the users and the carers. We are ready to roll. That enterprise is based on people, and much of it involves change, but we need to oil the wheels of change through investment.

Moving away from figures to the human dimension, we are faced with a real dilemma. If you disaggregate mental health and learning disability, the draft Budget allocation from the Department is £3·7 million for mental health for the first two years. Using the Department’s funding formula for staff — because it is a human-resource issue — that equates to 90 additional staff in total for Northern Ireland for the first two years.

Perhaps we can get our minds around that figure if we think about what it means for a health and social care trust. For example, that would mean 18 new staff in the Western Health and Social Services Board or in the Belfast Health and Social Care Trust. We have a dilemma, because we provide children’s services, adult services, older people’s services, and the list goes on. We could divide the sector into 10 big streams, which would give us an average of 1·8 staff for each stream over two years, or we could put all 18 staff into one stream and, perhaps, make a difference.

That has serious implications. The implication for learning disability is that far fewer people will move into the decent living conditions that you and I enjoy than the Bamford Review would have envisaged. They will either be in hospital or in other oversubscribed long-stay institutions. Ageing parents will have to shoulder the burden of caring for ageing children and young adults who ought to be provided for in supported-living conditions. That will mean a significant stall in the deinstitutionalisation and the recognition of the civil rights of people with learning disabilities.

That is central to the dilemma that we face. We can make a meaningful response — one that accompanies Northern Ireland’s economic well-being — by recognising that mental health and economic health are not at variance. They actually point in the same direction, and we can address the economic well-being of Northern Ireland by addressing mental health. I shall pause at this point, and take questions from the Committee.

The Chairperson:
Thank you, Roy. I am sure that many members are keen to ask questions. You blinded us with figures, but I managed to get most of them noted down.

I hope that focus is placed on the process of engaging with the Minister and officials to seek areas where productivity and efficiency savings can be realised and demonstrated with regard to mental health. I would like direction to be given in that area. However, that is not to say that the £175 million that is already being used in the mental-health service should not be considered.

Dr Deeny:
The Health Committee is extremely supportive of mental-health services. We are grateful that it has been pointed out to us that, as we suspected, there is a discrepancy between the money that is spent on mental health in Northern Ireland, and that which is spent in the UK. As someone who has worked in general practice for well over 20 years, for whom mental health is a major part of the job, I am entirely sympathetic.

Earlier, the Committee discussed not only additional departmental revenue, but efficiency savings. I would certainly not be qualified to comment on the management of mental health. However, I have watched how physical health has been over-managed. The Committee and I believe that a lot of money could be made available through efficiency savings if there were less bureaucracy and administration. Would that also apply to mental health?

Professor McClelland:
I suspect that, as is the case elsewhere in the health sector, there is scope for efficiency savings to be made in the mental-health sector. However, I have further concerns about 3% efficiency savings being applied to community mental-health services, as well as every other area across the board, on the assumption that the money will be put back and used to fund better mental-health services. Central Government takes that money out.

The board’s experience of efficiency savings is that those savings are not reinvested in the mental-health field. Therefore, my colleagues who are practitioners and managers are worried because they can see what is given out with one hand and what is pulled back with the other. Because that money is typically sitting in the large trusts with big acute services and is used when there are unpredictable calls on emergency funding, a lot of the efficiency savings disappear into the black hole of emergency care. I am extremely worried about that.

The Chairperson:
Earlier, the Committee touched on the issue that acute hospitals are not always the obvious answer. The Committee has taken cognisance of that.

Mr Easton:
Obviously, the Committee and I consider implementation of the Bamford Review vital. If we could create a bottomless pit of money for mental-health services, we would, but it is a major priority. Dr Deeny mentioned efficiency savings. I agree that any efficiency savings that are made in mental health must come back to mental health. That is vital. Is the money that has been allocated to for autism included in, or separate from, the money for the implementation of the Bamford Review?

Professor McClelland:
A small amount of money has been identified for autism in the overall mental-health allocation. I believe that a stream of money has been identified for autism-spectrum disorder.

Mr Easton:
Does the board get any help from the Education Department for that?

Professor McClelland:
No. The Committee must take cognisance of fact that implementation of the Bamford Review depends on developments in sectors other than health and personal social services. I am concerned that the ability to respond effectively will be affected.

Mr Easton:
Professor McClelland mentioned the money that is earmarked for implementation of the Bamford Review. Is there any other money for the overall mental-health budget that is not intended for that implementation?

Professor McClelland:
To the best of my knowledge — and I have sought clarity on the matter — the money that was identified in the initial communication to the Committee is mainly for service development for mental health and learning disability. I added to that the amounts that I understood were to be allocated for mental-health promotion and suicide prevention, which are £1 million, £2 million and £4 million. I should remind the Committee that elderly mental health and dementia have been folded into that mental-health budget; therefore, that is not a separate budget stream, as it was previously.

Mr Easton:
Is all of that money going towards implementation of the Bamford Review?

Professor McClelland:
Yes; all of it is inside the Bamford Review envelope.

Mr Easton:
That information is helpful; thank you.

Ms Ní Chuilín:
One of the issues that we discussed earlier was that, although the figures that have been mentioned relate to the health-rated part of the Bamford Review, other Departments have responsibility for mental health too. The Committee is keen to find out how much is allocated in that way, in money and percentages. You spoke earlier about civil rights and equality impacts in respect of people who are in institutions because there is no supported-living support for them. You also mentioned fuller lives and supported-living for older people — particularly those who have dementia — and you spoke about the education element of mental health. Therefore, we are not saying that the health budget is all there is to mental-health funding; we also want those other parts of it to be realised. The difficulty, as you have pointed out, is that the prioritising of health sometimes remains as rhetoric. When the way in which money goes to acute services is considered, the health purse is dipped into first, rather than last. We are keen to ensure that that does not happen.

We are aware that there is a limited amount of money, and that other Departments have responsibilities for health, although DHSSPS bears the bulk of the responsibility. Is there a sense that the Department is open to a legal challenge if people are not given the opportunity or the provision to move on to lead independent lives because of budgetary constraints? That is a theoretical question, and one that you may not want to answer, but my concern is about where the Department would be left if there were a drop in its commitments. Where would that leave the people to whom the commitments were made?

Professor McClelland:
In addressing this issue, I have concentrated on the moral argument, rather than the legal argument. The moral high ground is with the Board for Mental Health and Learning Disability, and we must address what is an unacceptable, chronic situation. Whether direct rule has contributed or not, there is a legacy of many years in which mental health and learning disability have been off the radar. The Executive and the Assembly are having to grapple with that problem while devolution is still in its infancy.

Mr Buchanan:
I echo what other members have said. The Minister made a bid of £12 million, up front, for mental health. In his seventeenth bid, he made a bid for a further few million pounds. What are your views on the content of those bids? It appears that, although they have been defined as the implementation of parts 1 and 2 of the Bamford Review, much of the content was contrary to the wider thrust of the Bamford Review, which was to redirect resources into the community. I would like to hear your views on that.

There has been a strong focus in the Bamford Review that mental health and well-being should be considered holistically. What discussions, if any, have you had with other Departments, such as the Department of Education, about their commitments to deliver the Bamford Review in areas such as child and adolescent mental health, and mental-health promotion?

Professor McClelland:
There are two elements to that question, starting with one about the visionariness of the Department’s bid. As it is strung out, it looks like more of the same: similar to a shopping list. I have been privileged to have been able to see much of the work that the Department have been trying to do in response to the Bamford Review. The language of the bid is a proxy for saying that we need to see the transformation of community services.

As a consequence, there will be some de-institutionalisation. Moving people back into the community and reducing bed numbers will be a secondary outcome. Departmental officials are committed to the broad vision and thrust of the Bamford Review. The service frameworks and response that will be written as part of the process must mesh with the Bamford Review. The board recently wrote to the Minister to highlight that it is important not to lose the Bamford vision. If the Department is adequately resourced, it will hold the tiller on the review. That is why the Department created the board: we want to challenge anything that departs from the Bamford vision.

Prior to the completion of the Bamford Review, I had meetings with senior officials and with permanent secretaries from the other Departments, and I have been very taken by their commitment. Linda Brown, who is the head of social policy, has advised me that there has been strong engagement and a major commitment from Departments. However, as a consequence of the draft Budget, they feel hamstrung on the resourcing side. I have today written to several Ministers to request a meeting during the consultation period.

Mrs Hanna: 
Roy, you are very welcome. From the little I know about mental health, I see no scope for efficiency savings. Mental health has been a Cinderella service for so long, yet it underpins so much, including giving people a stake in society, getting them back to work and economic regeneration. If we do not get it right, the rest will not fall into place. It is such a complex area that it is difficult to get a handle on the figures.

On the back of the problems in Muckamore Abbey Hospital, the Department has a proposal that all people with learning disabilities will be back in the community within a certain time. How will the Department do that? I do not know how many people have learning disabilities, but there will be some step-down provision and some supported provision.

There will also be involvement from other Departments. For example, the housing issue will need to be addressed. In the previous Executive, the Ministers for Health, Education, and the Department for Employment and Learning began to have meetings, particularly regarding learning disability, because there were cross-cutting issues. That would, at least, spread the load a little, and it would raise awareness.

Mental health is still an issue in the community. Having spoken to people, I know that they do not yet see the relationship between the Budget and the economy. There is still a stigma attached to mental health and a lack of understanding of it, and people just do not know what to make of it. I am simply trying to get a handle on the numbers — how many hundreds of people have learning disabilities?

There is an economic argument for good mental health promotion, especially concerning good parenting. As a former midwife, long before I had heard the term “early intervention” I was aware that some babies needed a hand from other than their parents. The earlier that intervention occurs, the better.

Furthermore, I want a handle on the amount of money for the Sure Start programme. How big is that amount? We are grappling with the Budget and, clearly, there is not enough in it, particularly for mental health services. We must better understand the need, and the fact that there is not enough money.

Professor McClelland:
During the comprehensive spending review period, four or five hundred people might have hoped to be resettled into the community. The learning disability element of the Bamford Review put a strong emphasis on moving quickly on the resettlement process. Mrs Hanna’s inference that other Departments play a crucial role is absolutely germane, to the extent that the Department for Social Development’s inability to deliver housing, or an alternative, locks us into the status quo of an institutional solution.

People with more severe and enduring mental-health problems have a similar dependency. In five years’ time, when the impact of effective community care will be visible, the board is strongly committed to reducing the need for mental-health inpatient services. Such a reduction will release resources downstream, but money is required up front to make it happen. It will not pay for itself because, as everyone knows, community care is not the cheap option.

I alert the Committee to the consequences of having to live with the draft Budget, which, as I understand it, allocates £1 million, £2 million and £4 million to mental-health promotion and suicide prevention: the suicide helpline could, in my view, eat up that budget. There will be nothing left for mental-health promotion or for the upstream needs of suicide prevention.

I suggested that there were two sides to this question — I do not want to be all doom and gloom today — and there is an opportunity for us to co-operate in a challenging win-win approach to make this investment, or at least any additional investment, pay for itself. I would like to discuss that with you before I leave.

The Chairperson:
We will come back to that when members have put questions on the first presentation.

Rev Dr Coulter:
Welcome, Roy, it is nice to see you again.

So far, we have talked in broad brushstrokes. Given that the Bamford Review had such a wide remit, what do you consider to be the main priority on which its implementation should begin?

Professor McClelland:
I would put the main investment into home-based crisis services, because they give people an alternative to hospitalisation. They create choice and, if managed with high fidelity, will reduce inpatient admission. That is already starting to happen, and the Bamford Review drew on some examples of good practice in Northern Ireland, with the Homefirst Community Trust being one of the best. That starts to unlock some of the inpatient resources, but community services must be developed. I cannot help looking at our future — our children. We cannot but invest in the needs of our young people, particularly in the black hole that is services for adolescents or young people.

It is easy to be drawn into a discussion on the number of available beds. However, what is required is the development in the community of a range of services to mesh around the telephone helpline for crisis services. A step-care model for adolescents must be incorporated into those services, and a similar model for adults is desperately needed. Much could be done at primary-care level to make a difference and alter the flow into secondary services.

Ms S Ramsey:
Thank you for your presentation, Roy.

You seem a bit disheartened, and I am the same, because the allocation to mental-health services in the draft Budget is ridiculous. Some may even go so far as to say that it is criminal, because we are failing the most vulnerable in society. You outlined how important mental-health services are to the community and society as a whole, and you detailed the long-term benefits.

In a sense, the Bamford Review was well accepted because it was the first overarching review of, and holistic approach to, mental-health services, as reflected in its outworkings. It was well received by professionals, patients and even families. Indeed, all parties supported it and wanted it to be implemented.

You are aware that the Committee is in the middle of teasing out some of the elements of the draft Budget. I do not speak for other members, and some may have questions for you, but the purpose of today’s meeting is to tease out some of the issues, rather than for the Committee to agree or disagree.

First, please tell me how you really feel about the draft Budget. I read your body language. How does the board feel? Will the moneys that have been allocated in the draft Budget make a real difference, or any difference at all?

One issue that keeps popping up is efficiency savings. You mentioned that there was “some scope” for efficiency savings. Can you give the Committee some ideas about those? You also spoke about long-term economic benefits. Can you explain what you mean by that?

Professor McClelland:
The latter question would take me into the second approach. I will be guided by the Chair as to what extent I should answer that question.

The Chairperson:
Please give an answer in full because only one more speaker wants to ask a question.

Professor McClelland:
Thank you. It would be ludicrous if I were to say that there was no scope for efficiency savings, as a first principle. In reference to Mrs Hanna’s question, it is a barren field from which to take money. I am still concerned that efficiency savings will not be used to develop an area that the Government has prioritised. The Minister does seem to have put mental health and learning disability up front. I am pleased to see that in the draft Budget.

In the long term, there would be efficiencies around releasing resources from inpatient services. We have said that there should be 20 beds per 100,000 people. In eight years’ time, if we get the right flows at the start — that is why the front end is so important. We have approximately around 35-40 beds. Even if the patient-staff ratio is improved to get better quality inpatient care, I am sure that we would release significant resources there. I put that all in the broad band of efficiency. The whole issue of the economic benefits, and the possibilities, is a very important consideration.

I believe that Dr Rory O’Connor, during the Committee’s visit to Scotland, touched on the issue of how the economic benefits of the forgotten majority are being managed. I have brought a few copies of ‘The Depression Report’. It was not written by a group of lofty psychiatrists in some institute; it was produced by the London School of Economics and Political Science. I will leave those with you. Lord Professor Richard Layard, from the London School of Economics and Political Science, along with a number of health economists, was concerned that — despite that fact that the UK Government has largely solved the unemployment problem — the real problem on the horizon is the disability level in the country. A major proportion of that — probably around 50% — can be attributed to mental health disabilities.

Lord Layard has been driving an initiative — which the Labour Government have accepted —that over the next seven years, we need to address the forgotten majority. I believe that we need to adopt a similar model in the North. I have already spoken to my opposite number in the Republic of Ireland, Ruth Barrington, who chairs the monitoring group for ‘A Vision for Change.’ We have shared our thoughts about a joint all-Ireland approach to that issue. We need to address the large number of people who, because of mental health problems —particularly depression, anxiety and those kinds of disorders — are not able to work and are on benefits, are distressed and are burdens to themselves and others.

The Government have been persuaded that addressing the matter will pay for itself. They have committed to the provision of 10,000 therapists in primary care over the next year. We need a similar model in Northern Ireland. If we had approximately £4 million per annum, rising by £4 million each year over the next three years — that is £4 million, £8 million and £12 million — in addition to what has been offered in the Budget, we could support the Minister of Finance and Personnel’s ambition of addressing the economic problem of Northern Ireland, and, in parallel, address mental health. In other words we could work together. We look not for a handout, but for a leg-up. That is a crucial and hard-nosed economic argument and we have an evidence base with which to demonstrate it. The model is being rolled out through a number of pathfinder sites in England. Staff from the Northern Ireland Centre for Trauma and Transformation, of which I am a board member, have visited the Durham site and we reckon that we can do the same in Northern Ireland. We have the training capability, however we need the resource investment.

By adopting that approach, we could transform primary care and the lower level of secondary care. I feel really positive that we can turn this situation around if we meet halfway.

Mr Gallagher:
I would like you to clarify an earlier point about dementia sufferers. From which budget will money be provided to support them in the future? Will those demands compete with mental-health demands? Will the money come from the same budget that covers mental-health provision, thus resulting in more demands on that budget? Have we any way of controlling how that will work as the budget rolls out?

At the moment, as we all know, the current budget is not able to provide that support. When we start to decide how the mental-health budget is to be allocated, will the trusts be able to propose, for example, that, because of pressures, funding for the care of existing dementia sufferers could be provided under the Bamford Review allocation? Would there be any cut-off point? Would it be the case that, because it is a new budget, only new dementia sufferers would be able to avail of it? Is there any way of making a distinction to control that?

Professor McClelland:
I am informed that dementia and the mental-health needs of older adults are in the frame as regards the Bamford Review funding allocation. There is no other budget that will provide new money for growth in those services. The challenge of demographic change in relation to dementia and mental health in older people must be solidly recognised and taken into account. Setting aside the need for an improvement in the quality of services, which is the general argument across the entire review, we are concerned about the effects that the increasing numbers of older people — like myself — will have on service provision.

In the draft Budget, there has been no commitment to allocating additional funds for the elderly or children. It could be argued that that is simply unacceptable. However, one can either do that or start spreading the butter thinner and thinner. That will mean the appointment of 18 new staff in Belfast over the next two years. Those staff could be used to provide care for elderly people or children, but if they are stretched across all areas, that would mean 1·8 persons per area. That is a major issue.

s regards policing this matter, that kind of policy development and change management must be underpinned by a strong performance and commissioning management arrangement. A strong dialogue is taking place in the Department, and between the board and the Department, on the need for strong performance management. For example, in relation to care pathways for the elderly, there would be discussion on what elderly people ought to expect next year, and in the following years. There are plenty of examples in, say, Scotland, and we can borrow from those and build on them. We do not have to discover the whole solution ourselves.

As the Committee is aware, service frameworks are being commissioned for mental health and learning disability, and that will drive the commissioning arrangement — it has to, although we must ensure that there is a joined-up approach. I am concerned that the commissioning arrangements have been stalled. The old boards have been denigrated because of the new trusts, and the new arrangement is not in place. That does not augur well for good performance management over that period. We must address that.

Ms S Ramsey:
Roy, you said that, in England, there is a 6·7% year-on-year rise in the Budget. You say that there are major announcements in England, but the percentage that we should receive here goes into the block grant, and does not necessarily go direct to services. What should we have received for additional services?

Professor McClelland:
I have argued from the outset, and raised in the Committee, that a 4·3% rise over the next 15 years seems a fair approach. However, recognising that in year one the system could hardly respond to 4·3%, I would suggest something in the region of 2% or 3%. I suggest £15 million in the first year, £20 million in the second year, and keep it coming.

Mrs O’Neill:
Thank you for your presentation. You said that one of the principals in the draft Programme for Government referred to building a strong economy, and I totally agree that a healthy population is needed if we are to build a strong economy.

I also agree that a 4·4% per annum uplift will be necessary, and we are realistically looking at an uplift of less than 1%. After what we have been through with the Bamford Review and its recommendations to address the problems, it is absolutely ridiculous that we still do not have the necessary funds.

You said earlier that the Budget would be eaten up by the suicide helpline. Are you referring to the £1 million, the £2 million and the £4 million going completely?

Professor McClelland:
I think that much of that money will be needed. The pilot scheme has not yet reported officially to the Minister, but the evidence is that it will take several million pounds to make it work across Northern Ireland. I am quite impressed by the scheme, as I wrote to the Committee in relation to suicide. It has been very well resourced, staffed and supervised; when young people phone up looking for help they receive a very professional response on a 24/7 basis. However, such a scheme is expensive to maintain, and I am not sure to what extent it really provides a full crisis service. From my evidence, it does not provide that, and it does not deal with full episodes. A proper crisis service and adolescence service will be needed to back up the helpline, and there is no money in the Budget for that.

Mrs O’Neill: 
I agree that suicide helplines play a vital role and can be the first point of contact for a lot of people with mental health difficulties; however, we will be in real difficulty if there is no money in the Budget for follow-through services.

Professor McClelland:
That is a real risk. I argue strongly about the importance of suicide prevention: much of the effort must go in upstream; we must look at the things that make young people vulnerable; and we must recognise that the majority of people who take their own lives are in the 20 to 50 age bracket. We must look at mental-health services. We are trying to address the issues of easy access to those services, proper discharge follow-up, choice and control in their lives, and a sense of esteem. However, all that requires money, resources and people — working differently, of course — in services, in mental health promotion, in education and in the workplace. That needs a mental health promotion strategy, but I do not see any money for it — not in this comprehensive spending review round.

Mr Easton:
Professor McClelland said that if we got £4 million, £8 million and £12 million over the next three years that would be like a halfway-house compromise situation. The Minister obviously wanted more money on his original bid. Would that extra money go a long way to help get the Bamford recommendations up and running and improve services?

Professor McClelland:
It would. The last thing I want to leave you with is that I see this as purely a financial argument. It concerns people, salaries and recruitment. However, it would take us 62% of the way to what Bamford was asking for. If it were to run for a few years, it ought to be cost-neutral; it should give the Department of Finance and Personnel back its money, because people would be off benefits and in employment — assuming that there is work for them to do, because there are other variables. That is the thrust of the argument, and the British Government have accepted that argument and have now committed to 10,000 therapists. We should learn from the lesson. We have the capability to deliver that model, and there is a strong argument to do that on an all-island basis because of the training skills that would be available. Northern Ireland is a small place from which to get the required training capability. That is merely a tactic, but if that sort of investment were to be achieved locally into such an initiative, we could win-win with the Government’s economic priority for Northern Ireland plc.

The Chairperson:
Are you suggesting that mental-health provision should be organised on all-Ireland basis?

Professor McClelland:
It would be one way of making the training capability work more efficiently. If the Republic were involved in similar initiatives — and I believe that it would be interested — a North/South axis could work well. Similarly, an east/west axis could also work. We would need to do that on a resource basis, along the lines that I have suggested.

The Chairperson:
Of course, the Republic of Ireland gets £6 million a day from the European Union. That is why it has amazing roads and amazing other capabilities to do the things that we would like to do.

Ms Hanna:
The economic argument is important, if only because it is such an economic Budget, and a lot of people look at it that way. However, it is only a draft Budget so we must make the case for spending. The case must be made for spending on mental health, but there is no room in the health budget to steal from other areas. More resources are needed for health. Every time I close my eyes, I think of something else that money could be spent on. In the area of suicide prevention, for example, money could be spent on training for educationalists and parents. Money is needed for an alcohol strategy, a drugs strategy and to tackle the problem of young people leaving school without a job, and their low self-esteem. There are many issues around suicide, which is only one, high-profile aspect of mental health. All of those issues require resources. The argument for additional funding must be made so that people can see in black and white that so many thousands of pounds will be needed in particular areas, and to understand that a lot of money will be needed to make a difference, or even to play catch-up.

Mr Buchanan:
You suggested that the arrangements for mental health should be made on a North/South basis. If that were the case, hoe would that help to improve the amount of funding that would have to be allocated from here? If it were done on a North/South basis, mental health would then have to be funded both ways. How would you see that helping financially?

Ms S Ramsey:
In other words, what are the economic benefits of an all-Ireland?

Mr Easton:
Do not get carried away.

The Chairperson:
We will not go into that. There is a border, and there are North/South and east/west.

Professor McClelland:
Currently, there is North/South feasibility on health collaboration. There are important choices on, for example, transplant services, and other similar services. It has occurred to some that there are possibilities for co-operation on mental health. One of those is the training and workforce capability, which is a real opportunity. I have raised that with the interdepartmental group, and I understand that consideration will be given to a possible workforce training model of that type.

Dr Deeny:
This is such an important issue, and I speak for a lot of my colleagues in general practice in saying that you have my full support in the Health Committee, and as a doctor. I agree with you when you say where the money would be spent because I have seen the evidence of where that works. To give some examples, there is a crisis team in the Northern Board that works excellently.

The Committee has seen the psychiatric backup that is given to the A&E department at Craigavon Area Hospital, and I have worked in a local out-of-hours centre where there is a community psychiatric nurse (CPN). Therefore, evidence already exists of where money can be well spent. Our complete dependence on CPNs means that without them, our practices would be destabilised. You therefore have my full support, and I think that money for those projects must be found somewhere.

I asked about making efficiency savings in mental-health services, and I wondered whether that sector is over-managed or over-administered in the same way as physical medicine. It should be the other way around: if savings can be made elsewhere, they should be pumped into the important sector. Professor McClelland’s argument is strong, and I put my support for it on record. I agree with him, given that I have seen that if improvements were made to an individual’s mental health, their productivity would also improves, which in turn, would help the economy across the North. As Carmel Hanna said, as we are discussing a draft Budget, the Committee should push hard to have Professor McClelland’s plans implemented.

The mental health of adolescents and young people was mentioned. Given that they are our future, their mental health concerns me. Post-natal problems were also mentioned, and there is a dearth in Northern Ireland of support for those who suffer as a result of those difficulties. Is a way to deal with those problems part of the plan for the future? Are young psychiatrists interested in working with adolescents and children? I am not sure whether this concern has permeated into the mental-health sector, but I know that worries about the threat of litigation when working with children is a deterrent for professionals. What are your views on that?

Professor McClelland:
As I said at the beginning of my submission, in Northern Ireland there is an air of expectancy, and the Budget has created some anxiety, that means that we should capitalise on the energy and commitment that hundreds of people, including members of the Royal College of Psychiatrists and the Royal College of Nursing (RCN), contributed to the Bamford Review. I attended a seminar and a masterclass with the RCN last Friday, and I know that some of its members do some inspiring work on recovery. Therefore, we must nurture that.

A resolve to invest in mental health, given its importance to the economy and despite the original Budget position, would provide a strong morale boost for the entire workforce. If that happened, many of the issues about recruitment in certain areas could start to be addressed. The problem of recruitment in the mental-health sector involves more than a lack of doctors — other staff and types of workers, especially graduates, are required. Layard’s back-to-work model, which was referred to, is a resource model that includes professionals and other people, such as graduates, which we have in Northern Ireland. Those people could get involved in the caring side and make a real difference to the lives of people — from young adolescents to adults and older people.

The Chairperson:
Thank you, Roy. I want to sum up on a few points. The Committee has a big responsibility in scrutinising what the Health Department does with the draft Budget. We have 10 weeks of consultation and input, and we will begin a detailed line-by-line scrutiny of the draft Budget. However, the result also depends on how attuned the Minister has been in submitting, and arguing for, his bids. Everyone here realises the significance of the needs that exist in the mental-health sector; having flagged up the issue for many years, no one understands that significance more than me. The public must be shown that every pound that is ploughed into the Health Service is well utilised and represents value for money.

The Health Committee visited two magnificent units in Altnagelvin and Craigavon, both of which deal with a wide range of mental-health illnesses. We saluted and applauded those models when we visited them. It would be ideal if a similar unit were established at the Ulster Hospital. Although the psychiatric nursing unit (PNU) in Ards will be moved to the Ulster Hospital, in the meantime, throwing money at the Ulster to add a few beds is really only a short-term answer, given that what we need is a stand-alone facility in the grounds.

There are productivity problems that centre on the lack of decision being made to have a single authority. In our scrutinies, we will undoubtedly come up with efficiencies, and I hope that we can get some sort of assurance that those savings will be ploughed back into health. That is my objective, and given that mental-health services have been the Cinderella service of health provision in Northern Ireland, I am sure that the Committee will want to see any efficiencies going back into that sector.

I hope that you will give us the opportunity to scrutinise and make suggestions about how to make progress. We will meet with the Minister, DV, on 6 December, and I am sure that that will be an interesting meeting.

Although, North/South liaison and mutual help is very important, and I say without apology that I also see a very important basis for east-west co-operation.

Thank you, Roy, for all the work that you do in the mental-health sector, and thank you for coming today and sharing your wide experience.

Professor McClelland:
Thank you.

The Chairperson:
Evidence for this session will be given by Stuart MacDonnell and Dominic Burke, who are representing the health and social services boards. Dominic is acting chief executive of the Western Health and Social Services Board, and Stuart is the chief executive of the Northern Health and Social Services Board. They will be speaking on behalf of all four boards. They will have 10 minutes to speak, during which one or both of them may give a presentation. Members will then ask questions. I thank the witnesses for providing a copy of their submission in advance, which members should have.

Mr Dominic Burke (Western Health and Social Services Board):
I am the acting chief executive of the Western Health and Social Services Board, and Stuart is from the Northern Health and Social Services Board. We are speaking on behalf of Dr Kilbane and Sean McKeever, and we are pleased to have been invited to attend today’s session.

I will make some brief introductory remarks, and Stuart will then discuss Building a Better Future. As members know, the health and social care system is going through a period of unprecedented change. I hope that the Committee will agree that, over the past number of years, considerable progress has been made in the development of cancer services, services for people who have long-term conditions, reshaping services for families and children, improving access to services, and reducing waiting times.

However, as we address the question of what sort of Health Service we want for the people of Northern Ireland, more needs to be done. We must: invest more in mental-health services; further develop childcare services and procedures; continue to provide services for the sick and most vulnerable; ensure that services keep pace with advances in medical technology; and ensure that high-quality services are supported by modern infrastructures.

The needs of the population that we serve will always outstrip resources. Therefore, it is important that, while living in financial reality and targeting our efforts on those who have the greatest need, we do everything that we can to ensure that as many needs as possible are met.

For example, over the term of the comprehensive spending review, the older population will grow significantly, increasing by some 30,000 in Northern Ireland. In the west, that will mean an overall increase of 14·5%; an increase of 17% in the 65 to 74 age band; and an 8% increase in the 75 to 84 age band. A significant figure is the projected 22% increase in the over 85s. It is recognised that that growth in the older population will increase pressures on the health and social-care sector to provide services that match the growing dependencies of those people and the needs of their carers.

We welcome the resources that have been allocated to health and personal social services, and we fully support the drive for greater efficiency and effectiveness, as well as reform and modernisation. We recognise and will embrace the responsibility of ensuring that we get as much as possible for every pound that is spent on health and social care. We must continue to strive for efficiency and effectiveness, and we must do everything possible to maximise performance and deliver the targets that have been set.

We have long-term strategic frameworks and policies to ensure that people get equitable access to the right services, in appropriate settings, when they need them. Those services must be delivered by suitably qualified staff. The aim is increasingly to deliver accessible services as close as possible to communities, so that patients need only go to hospital when it is absolutely necessary.

We note the latest announcement about the comprehensive spending review. At one level, it is clear that additional resources will be invested. However, the question that we must ask is whether we will be able to fund all that is required from the growth moneys and those funds that are freed up from the cash-releasing efficiency measures.

We have to face the reality that change is very difficult, particularly on the scale that is required within the period of the comprehensive spending review. Although reform and modernisation will bring about a more effective and responsive pattern of service, the public do not always support changes because of loyalties to existing facilities and services. The change programme will require commitment from all of us as we work to reconcile competing demands and scarce resources. We must be open and frank with all stakeholders so that it is clearly understood that not all demands or needs can be met, and we must recognise the tensions that exist between maintaining current services and developing new services.

It is important to recognise that considerable amounts of health and social-care funding have to be devoted to implementing national pay modernisation policies, meeting inflationary pressures, especially for matters such as drugs, and working on national or regional initiatives, such as the NHS Agenda for Change programme or anti-tumour necrosis factor (anti-TNF) drugs, that require ring-fenced moneys. The latest round of efficiency and cash releasing must be achieved in that context, and considerable, and at times, difficult, decisions must be made that will inevitably have an impact on service provision.

If we are to continue to deliver the reform and modernisation programme, money will have to be released by making radical decisions that will require an examination of current patterns of service provision and use across the totality of health and social care. We must change the way in which services are provided in the voluntary, private and primary community sectors of the health and social-care system. However, one thing is clear: we will have to change the way in which things are done in virtually all sectors of the Health Service. It is not about what we do; it is about how we do it.

The reform and modernisation programme will have to be accelerated over the next three years. Difficult decisions and painful choices will, at times, have to be made as services are realigned. However, not all the plans that the Health Service wishes to make under the reform and modernisation programme can be funded from the £798 million available. That means that everyone who is involved in the health and social-care sector faces a collective challenge and responsibility. We must engage in a transparent, respectful and straightforward way with the population in general and with specific groups who are affected by any decisions that are made.

The next three years will not be easy. However, we have a Health Service of which we can be very proud, and we have staff who show tremendous commitment and dedication to their jobs. At the same time, change is needed, and difficult decisions will have to be made. We look forward to engaging with MLAs and the Committee so that the public and their political representatives are fully informed and engaged in the programme of work that must be done.

Mr Stuart MacDonnell (Northern Health and Social Services Board):
I find Health Service finances daunting and, at times, incomprehensible. As I began to prepare this briefing, I set down a series of questions for myself in order to clear my own thinking. Members of the Committee will find a copy of that list of questions appended to Mr Burke’s paper. I would like to share with the Committee what I found when I examined the Budget and talked to colleagues in various disciplines about its implications.

The members of the Committee have obviously picked up a sense of disappointment from many health and social care commentators. I would like to explain the reason that that is the case. Undoubtedly, health and social care expenditure will grow, on average, in real terms by just over 1% per annum over the planning period. We appreciate that very much, but the Wanless Report in GB and the Appleby Report in Northern Ireland have both indicated that needs are growing in real terms at 4·3% or 4·4%. Northern Ireland’s expenditure on health and social care continues to be higher than that in Britain, although the differential is eroding. The Appleby Report also advised that Northern Ireland’s needs are greater than those in Britain. Dialogue with the Department of Finance and Personnel indicates that the differential is increasing, and we understand and accept that it is now around 14% or 15%.

I understand that, based on Professor Appleby’s analysis, the funding gap — based on need, rather than raw population figures — is currently around £300 million. There is a debate about the composition of that figure because of the difficulties in comparing like with like. However, irrespective of the actual position now, all commentators agree that the budgetary provision over the next three years, compared with that for England, will increase the funding gap by a further £300 million, simply based on applying the difference between real-terms funding increases of 1·1% in Northern Ireland, and 3·7% in England.

That said, health and social care is a devolved matter, and it is for the Executive Committee and the Assembly to determine funding priorities among the competing programmes. In that context, there is an interesting comparison: although spend per head of population is also higher in education than that in England, Northern Ireland’s principal pupil population of under-16-year-olds will decline by about 4·4% over the three-year period, whereas the general population requiring health and social care is increasing, and the most dependent and costly population — elderly and very elderly people — as Dominic said, is increasing much more rapidly.

According to figures from the Office for National Statistics, the age-weighted population growth in Northern Ireland is 1·45% per annum during the CSR period, which is unarguably almost twice the age-weighted growth rate in England during the same period. I have more data to show how that relates to resource demands, which I will be happy to share with the Committee.

As the Committee knows, by far the greatest proportion of the unavoidable pressures that will require funding over the next few years are driven by pay and non-pay inflationary contractual uplifts, which are based on national contracts. There is limited scope under the banner of unavoidable pressures for quality changes, but there will be some enhanced renal services; further investments in child protection and services for children with complex needs; limited investment in secondary care and drug pressures; and a very small investment in the maintenance of medical and nursing services in the smaller rural hospitals.

We acknowledge and record our appreciation that the Budget allows for new development programmes, but the amounts will be £16 million in 2008-09, a further £16 million in 2009-10 and £65 million in 2010-11, which totals £97 million — against original bids of £302 million. The Committee heard Professor McClelland explaining how he might use the mental-health proportion of that.

There will be discussions shortly with people such as Professor McClelland to firm up the specific outcomes across those strategically essential service developments. I understand that the Minister issued some proposals on that matter to the Committee yesterday.

None of that will be possible unless the service itself also achieves efficiency savings of £118 million, £114 million and £111 million for the three years, which comes to £343 million. Those are recurrent figures, which come on top of savings of £146 million that were made over the last three years, giving a total of £489 million in recurrent savings. In short, 43% of the total investment pool for the three-year period will be achieved within the service and 57% will come from new moneys.

Trusts, with the support of their local commissioners, will bring forward plans shortly to phase in the achievement of those savings over the planning period, focusing particularly on next year. Some of those initiatives will just be a continuation or roll-out of projects that are already in train. However, I must caution the Committee that the savings target is more than twice the annual rate that was achieved over the last three-year period. As we know, in any walk of life, pursuit of efficiency gets tougher the closer one gets to the core of the area being targeted.

A productivity change whereby, in essence, we get more output for more cash input is often relatively easy to achieve. A productivity change whereby we get more output for the same cash is often harder to achieve, but the hardest change to achieve is to improve productivity by getting the same output for less cash and to release the savings for reinvestment in other services. The latter approach is the nature of the cash-releasing challenge facing the service.

As we know, personnel comprise 70% or more of the service’s total costs. If we are not to dramatically reduce the overall workforce, we will have to re-profile the shape of services in such ways as Professor McClelland outlined earlier. That tends to push one in the direction of rationalisation and centralisation, and away from institutional care.

There are many clinical arguments as to why a re-profiled service would be better for patients, but experience shows that people in Northern Ireland are much attached to the current distribution of acute services, in particular.

Attempts to change that situation radically or quickly tend to run up against opposition from local people, and elected representatives. Anything is possible if we are all united, but we must avoid a salami-slicing approach that disadvantages everyone.

As the Committee may be aware from previous briefings, the RPA savings target for the Department of Health, Social Services and Public Safety is £53 million, which equates to a reduction of approximately 1,700 posts over the planning period. Although those are large numbers, they are 15% of the total service-wide CSR target. About a quarter of the RPA target, which amounts to £13 million, remains subject to future decisions on the boards and other non-trust elements, which the Minster is reviewing. The implication of the delay to the achievement of the target for the completion of RPA at board and trust level is approximately 3% to 4% of the CSR total.

It is possible that we may catch up, should the Minister’s proposals receive early agreement from the Executive and the Assembly. At that point, implementation could be brought forward to ensure that that aspect of RPA delivers its share of the total target, which in turn delivers its share of the total efficiency target; however, I must stress the proportions: the board and agency share of RPA is approximately 4% of the total CSR target; the total RPA target share of the CSR target is 15%. Additionally, as the Committee may have heard from officials last week, the current procurement efficiency target amounts to approximately 10% of the target across a range of headings; and the wide-ranging pharmaceutical services programme is planned to achieve almost 12% of the target. Therefore, with 15% from RPA, 10% from procurement and 12% from pharmacy, 63% remains to be delivered from direct service provision.

Although those changes are intended to be more resource efficient, we must be absolutely focused on the safe delivery of care and, more appropriately, care that is closer to people’s homes. It may seem implicit that in signing up to that agenda of 9% cash release over three years, we are also signing up for a major rationalisation of institutional care provision, but perhaps that should be made more explicit. To come anywhere close to English costs, which we acknowledge are lower, we must ensure that the smaller, more uneconomic facilities will either be closed or be radically re-profiled, and our provision around the major hospitals must also be significantly reorganised and improved. Much of that work is already under way, and many such reforms are long overdue, and are necessary to maintain quality, safety and effectiveness. We must ensure that our services continue to be delivered at a level of scale that justifies the size of clinical teams, which can deliver to current medical standards. That is the direction of travel already indicated in previous Government reviews of acute services, both here and in Britain, and everyone is working to achieve that goal.

As Dominic has indicated, selling the benefits of that change in quality terms is a mammoth communication task, particularly in an era of financial stringency. However, we must not focus solely on acute services, as they comprise 40% of the budget, and if we want a 9% saving from the total budget, a focus on acute services would require a reduction of over 20% in acute services, which is simply not realistic.

Significant cash-releasing savings must also be made in community and primary-care services, mental health, learning disability, older people’s services, children’s services, services for disabled people, other service programmes, and in primary care.

Committee members are aware that the existing funding of health and social care is distributed to the various parts of Northern Ireland based on population, weighted for need; however, actual share lags far behind the targets determined by the formula. The formula signed up to by all the participants demonstrates an inequity of resource distribution, as the southern, western and northern health boards, which are the three smallest, are disadvantaged to a sum of over £20 million in total. In the current financial climate, although Dominic and I will continue to advocate for the earliest implementation of change to address that issue, we also recognise the consequences for the resource losing population, largely in Belfast and the south east, where services will change even more if the proposals are implemented.

We recommend to the Committee that, although everyone must achieve the same efficiency target, the investment fund might be skewed towards those areas that are under-resourced. There will have to be a difficult juggling act to ensure stability.

The investment strategy for Northern Ireland has highlighted in capital terms the leading projects to go forward over the next few years. We commend the sponsors of those projects for their success. However, as members will have seen from the ISNI, there is a long tail of projects that are unaffordable in the incoming planning period and which have been profiled out from 2011 to 2018. Some of the service-efficiency-savings projects are now critically dependent on early implementation of, for example, ‘Developing Better Services’ changes in the hospital pattern. Doubtless, our colleagues in the trusts are re-examining their capital bids to ensure that they address the twin goals of maintaining services in vulnerable settings, while achieving their statutory duty of breaking even financially.

If a capital project is put on the long finger, investments to shore up a vulnerable service may be needed. That may well achieve service continuity, but will also push up the cost of delivering that service and take us further away from meeting our efficiency challenge. It will be a formidable challenge for us to work together to manage that change in a way that avoids sudden or unplanned deterioration in service.

The messages that Dominic and I offer the Committee are as follows. Health and social care has made considerable progress in recent years across a broad canvas. There is much more to do to improve performance and implement long-overdue strategic change. That will deliver a better service. Managing change is difficult and requires us all to question our attitudes. We need to maintain vulnerable services while we secure the resources to invest in order to save. We have a population that is both aging and growing; and, every year, we need a significant real-terms increase to maintain our ability to respond to needs. We have many unavoidable costs, which welcome additional money in the Budget will go a long way to meet. We can deliver the release of cash to fund some of our needs. That will require reduction of our people costs and a reshaping of much-loved — and often local — services. We have a highly-committed and able workforce which needs, and will welcome, the Committee’s support and public commitment to delivering on the health agenda.

We are grateful to the Committee for the invitation to attend this meeting, and we look forward to answering members’ questions.

The Chairperson:
It would have been helpful had we received your presentation in advance because it contains so many facts and figures. I am able to use shorthand, but other members cannot.

I welcome your presentations. Tell me what impact the uncertainty regarding the reforms recommended by the review of public administration is having on the staff and ongoing work of health boards. I have made some inquiries about that, but I am interested to hear your view.

Mr S MacDonnell:
We understand that an announcement on that matter is due shortly. As the Committee knows, our staff have been informed by the Minister that change is unlikely before 2009. We have lost a significant number of staff over the past 12 months. In the current climate, we are unable to recruit to successor posts because we are maintaining a vacancy-control system throughout the health and social care service, and that includes the trusts. Staff want to know what portends for their future, and they are concerned. We understand that the savings target of 25% on management costs — RPA figure 53 — is based on a reduction of such costs throughout the service, not just in the boards. That remains in front of us. We continue to work, but not at full steam because of the recent loss of staff.

The Chairperson:
Do you accept, however, that Northern Ireland’s health and social care system has 26% more staff than that of mainland GB? There are undoubtedly efficiencies that could be realised if the decision were taken to amalgamate the four boards into one strategic health authority. From what I have heard, the entire process is most unsettling. People who would like to leave through natural wastage are holding down jobs that are surplus to requirement.

That is not a healthy environment in which to work. I wanted to hear what you had to say about that issue.

Mrs Hanna:
As the Chairperson mentioned, why are there 20%-plus more staff here?

I thank the witnesses for their presentations; the Committee has never seen so many concise figures. I would very much like to have a copy of the presentations so that I can read them again.

The Chairperson:
That information will be in the Hansard report. We have not received such information from the Department.

Mr S MacDonnell:
I will ask for our papers to be copied for you today. There are a few squiggles — I am sorry, my handwriting is not so good.

Mrs Hanna:
I found the presentations really fascinating; they contained a lot of information.

Stuart, you mentioned that the savings target was twice as high — in respect of expectation and demand — this year than it was in previous years. Is it possible to meet that target?

Mr S MacDonnell:
From memory, the target was 1·25% over the previous three-year period. That has now risen to 3%.

Mrs Hanna:
Does that take the efficiency savings into account?

Mr S MacDonnell:
The efficiency-savings target breaks down into different chunks, so I could deal with that a chunk at a time.

Mrs Hanna:
That might be helpful.

Mr S MacDonnell:
The overall target is £343 million. The £146 million of savings that I mentioned earlier is already in the bag from the past three years, and, as I said, the new rate for finding savings is more than twice the old rate. Therefore, the question is: can we up our game to achieve twice the rate?

Of course, we must consider the review of public administration. The RPA savings go towards the figure of £343 million; they are not outside that figure. There is also the procurement efficiency programme, which a central working party is deliberating on. The figure for that is in my notes.

Mrs Hanna:
There have probably not been any RPA savings yet. They are all being planned for.

Mr S MacDonnell:
The trusts should be making those savings right now, because that process is under way.

Mrs Hanna:
It would be interesting to tease that issue out, because it is difficult to get a handle on it. Although we expect the RPA to bring savings, it is difficult to know what they will be. There is much confusion because the situation is still in a state of flux. I presume, then, that the trusts have started to deal with this matter. However, it is not clear whether there will be much to see yet.

Mr S MacDonnell:
The scary aspect is that the savings will be taken out at the start of the year, so it will be presumed that they will be made, and the trust must then find the initiatives to make those savings. Procurement is moving forward centrally, and the pharmacy-management programme is under the supervision of the Chief Pharmaceutical Officer. It will be up to the service itself to find the rest of the savings.

I understand that the trusts have to prepare their initial plans on how to address that issue by mid-December, with a particular focus on next year, because we are so close to the end of the year. That is an extremely daunting challenge for the trusts. That is why I said, perhaps a little frankly, that I cannot see how those plans can progress without institutions having to be reshaped — rather than simply adopting what is called, in our jargon, a salami-slicing approach, whereby it is a case of giving everyone a 3% target and seeing how they get on with it.

Mrs Hanna:
In previous years, it seems that, rather than having enough money to provide extra health services, we have almost been standing still on health provision, and we are still behind England in resources per capita. Therefore, meeting the savings target will be a very daunting task.

Mr S MacDonnell:
It is extremely daunting, but, equally, we understand that the Minister of Finance and Personnel’s room for manoeuvre is next to zero, unless the Assembly and the Executive Committee take money out of another programme. Therefore, 3% is the figure across the board, and the figure that every Department in Northern Ireland has to achieve. Running the Health Service involves a great deal of money and staff, so there should be a lot of potential to make savings. However, that will be a very painful process. The great challenge is to ensure that the required reduction in staff numbers can be achieved, as the Chairperson said, on a voluntary basis, rather than on a compulsory basis. That is the real nub of the challenge.

Mrs Hanna:
The concern, as always, is that if staff numbers have to be reduced in order to make those savings — even if that reduction occurs through natural wastage — we will lose front-line staff.

Mr Burke:
I would like to make two points. To pick up on the Chairperson’s point, as the RPA is rolled out, there will be a reduction in the number of trusts and the number of boards. Clearly, having one body responsible for commissioning services, developing performance management and financial management across Northern Ireland will mean that the service is delivered more efficiently and effectively.

One would expect that there will be an overall gain from the impact of RPA, and that is an important point. As we have said, that will also require the board to re-examine how services are delivered. In doing so, it will be necessary, particularly considering the significant changes in communities, for people to be aware of that. That is why the public consultation must take place. There will be a need for political cover as one goes down those roads. It is important, as I said in my presentation, that we share information with MLAs and consult the public about what the impacts might be.

Mrs O’Neill:
You said that the facts and figures were daunting. As a Committee, we would agree with that, but we will not shy away from the facts and figures. In your paper, you said that all sectors of the service have to change the way in which they do things. The Department’s response to the draft Budget outlines a number of inescapable pressures to be met. Do you think that there is scope for efficiency savings in those inescapable priorities?

Mr S MacDonnell:
By now, those inescapables will have been scrutinised on several occasions by DHSSPS and DFP. I doubt that there is much flexibility within those figures. Some of the risks lie outside of that, in that some new pressure or emergency that is not in our line of sight may take place. For example, the draft Budget includes a figure for preparation for an avian flu epidemic. That figure is not funding for dealing with such an epidemic; it is preparatory expenditure to ensure that we are ready for the commencement of it. The issue is how the health budget would flex to deal with something happening that is not in the plan. There is little flexibility to that end. Any flexibility will come from the £97 million that is to be allocated by the third Budget year for service developments. As Professor McClelland said earlier, mental-health services are due to get a share of that allocation.

The further risk is the service getting behind in the release of the cash. The £97 million, of course, is also at risk if the service cannot deliver £343 million of efficiency savings in the third Budget year. The draft Budget allocates £455 million of new money by the third Budget year; £343 million added to that is nearly £800 million. However, if the Health Service gets behind in delivering £343 million of efficiencies from its various initiatives, there is a risk of a cash crisis if some new health demand were to spring up that we are not currently aware of. The officials who have scrutinised those figures would not have put them in front of the public unless they were comfortable that they met the declared inescapables.

Mrs O’Neill:
In your presentation, you said that if a decision on RPA were brought forward, it would release more money. You said that that would be 3% to 4% of the CSR total. Can you elaborate on that?

Mr S MacDonnell: 
The total amount of savings that are expected under RPA for health and social care is £53 million. The proportion for the boards, the Central Services Agency and the other agencies — the non-trust element — is approximately a quarter of that: around £13 million. That figure of £53 million is around 15% of the total efficiency savings in the third Budget year: £343 million. A quarter of 15% is nearly 4%, so the board-trust cash release is 4% of £343 million. I used the term “catch up”; it should be possible to set up organisations in shadow form, pending legislation. However, that would only be done if the will of the Assembly were clearly behind that. When the Minister releases his proposals in due course, that will be a matter for you, not for us.

Mr McCallister:
I agree with Michelle O’Neill that the figures can be daunting, but the information that has been provided is useful. Mr MacDonnell, if I picked you up correctly, it is assumed that your board will achieve the efficiency targets.

We are all in agreement that everyone one wants to see as efficient a public service as possible, whether it relates health or other public services. Are your boards benchmarked against boards in other parts of the country, and against their equivalents in England, Scotland and Wales? How efficient are they in comparison to those boards? It would be useful if you could elaborate on that.

You made a comment about reshaping institutions. If the draft Budget is accepted, what is your vision of what the reshaping of institutions would entail? What do you mean by that?

Mr S MacDonnell:
Following a review in 1994, the boards, as commissioners, were set targets for expenditure as a percentage. That was based on an exercise that was carried out to compare the planning and commissioning function between here and across the water. If anyone is interested in that, I am sure that the report still exists.

The report published figures in the region of 1·8% for the western and southern boards; 1·7% for the northern board, because we are bit bigger that the southern and western boards; and 1·5% for the eastern board. Those figures basically mean that no more than 1·8%, 1·7%, and 1·5% of each board’s total budget should be spent on administration. Since that time, to the best of my knowledge, all of the boards have kept within that.

As the new structures proceed, that will be revisited as they will have an entirely different look. The RPA has set a target of a 25% reduction on current expenditure. There will be an equal concern not to spend any more than that on those new commissioning structures.

There are lots of comparable studies of the clinical services, the institutional services, and the community-care services. The main report was by Professor Appleby in 2005, which was a comparative study of expenditure on health and social services in Northern Ireland and England. He struggled with the data on some issues because the English system is not quite the same as ours. Therefore, in retrieving the data and analysing it, he had to give a few health warnings — pardon the pun — regarding his conclusions.

The report basically concluded that the services in Northern Ireland could be made more efficient. However, in another section of his report, he said that, even when services are more efficient, more money will be required to meet the growth in healthcare need that will occur over the next few years as a result of changing demographics. That part of his report is comparable to the review conducted by Sir Derek Wanless, which was a similar study of health trends that was carried out for the Treasury in England.

I believe that we will knuckle down to achieve the cash-releasing target. However, if we are not growing our resources in real terms to meet the ageing population, we are going to run into trouble soon. That is daunting, and that is what worries us most.

Mr McCallister:
How do you think some of those institutions should be reshaped?

Mr S MacDonnell:
I shall refer to my own area, because that is what I know best. We have a plan to reform acute and community services in Ballymena, Larne, Magherafelt, Newtownabbey, and particularly at the new hospital that opened in Coleraine in 2000. We have submitted proposals and business cases to the Government in order to gain the resources that we bid for in ISNI. Sadly, those proposals have been deferred until the next CSR period, which is 2011 onwards.

Nearly all of those proposals are based on good clinical practice for patients; not cost-cutting measures and saving money. In truth — we must not duck the issue — they would be more resource efficient.

Much of the criticism from commentators in England about our cost comparisons with their system is based on the fact that we have a distributed, localised, institutional-care pattern. However, that is what people like, and that has been the case historically. In England, there has been a move away from that, which has resulted in greater efficiency. We have probably not moved at the same pace. Therefore, my concern is whether we can maintain the clinical services in Magherafelt, Whiteabbey, etc, until the next CSR period, which is 2011 and beyond. That is a risk that frightens me.

Mr Buchanan:
We have to be realistic, as Dominic Burke said. We must have good financial management of whatever amount is allocated to health, and acknowledge that health has 48% of the block grant in the draft Budget. I do not know of any other country where health receives that amount of the overall capital Budget.

There is difficulty with financial management in Department of Health, Social Services and Public Safety, and I commend Dominic for saying that he realised that the Health Service has to live within the budget. There is full support for the drive for greater efficiency and effectiveness in the whole of the Health Service and in its budget.

How harmful is the Minister’s delay in reforming the four boards into one health authority to the efficiency drive in the Health Service? The Department of Health in Northern Ireland is 10%-11% less efficient than the same Department in England. What work has been done to compare the two to see where we could make savings? Productivity is another area of failure, and that should be examined.

Furthermore, there are too many managers in the Health Service. Years ago a ward sister and a matron were responsible for keeping their own hospital area clean. Interestingly, there was no MRSA or any other superbug, because they made sure that everything was clean and tidy and that service was delivered. Tiers and tiers of management replaced the ward sister and the matron and, instead of putting in more staff to deliver services on the ground, managers sat in offices trying to deliver services without enough staff or nurses. That has to be tackled urgently if efficiency is to increase.

Every Department requires more money, but the Health Department is getting 48% of the block grant, and it is up to the Minister to manage that money and deliver a proper health service for the people of Northern Ireland. That can be done with proper efficiencies and management, but it has to start now. The dragging of heels over bringing four boards into one is having a serious effect on the efficiency drive. I would like your views on that.

Mr Burke:
I agree that we would all like to see the four boards moved to the one authority to oversee the health and social care agenda in Northern Ireland, and to deliver on the commissioning agenda.

It is two years today since the report was published on 22 November 2005. We were certainly geared up to see those changes take place. I can understand that a new Minister would want to ensure that he could stand over the developments that were taking place on his watch. However, the fact is that if we were moving towards a single system, as the Chairman pointed out earlier, we would have seen many people leave the service; we would have moved to a more integrated process of commissioning services; and we would have had the introduction of very effective performance and financial management across the north of` Ireland. It would have been advantageous, and we would have been on the way to having efficiencies in staff numbers, where, currently, four systems are running, as opposed to one. I accept your point.

The question of productivity, and going forward, is significant. Cleanliness and infection control and management are critical. However, some of the occupancy levels of our hospitals are running at 98% and, in some cases, higher. Consequently, there is the greater potential for infection, due to the high level of throughput. MRSA, and how it is managed, must be looked at. There are ways of managing MRSA, and that comes back to what is more efficient.

It may be much more efficient to treat people at home and admit them to hospital only if it absolutely essential. If, working with our primary care and community care colleagues, we were able to give effective care in the community, the number of people going into hospital would be reduced, and enhanced services could be provided for people at home. That is what most people want, and older people in particular would prefer to avail of those services.

There are other areas, and Dr Deeny will be familiar with those. Urgent care out-of-hours services work alongside A&E departments and social worker out-of-hours services. Professor McClelland described the out-of-hours services that have been provided for mental health. Those services are often run independently and are not integrated. Not only are they based in different places, they are often differently managed. People can be working in one geography, but not working together.

We started off by talking about the co-location of out-of-hours services. Integration of out-of-hours services is another area in which there is significant improvement.

However, there is another issue. I was advised recently that there are in the region of eight A&E departments in and around the greater Belfast area. Members watching television last night might have seen that a report recently published on A&E services stated that to get the best out of A&E, it must have a highly qualified team of people working in a centre of excellence. It strikes me that we, as commissioning services, must look at those areas, see where that service should be and how many such centres are needed in Northern Ireland. If five are needed, we must see how that could be done effectively. It may mean that people will have to travel further. For example, to receive a better service for a very severe road-traffic accident may mean travelling to a centre where the people are skilled in dealing with cardiovascular work, severe chest injuries, etc.

We can talk to people about a whole range of issues to see how those matters can be taken forward. That is the agenda. I have talked about the political cover being essential: that must be a shared agenda, and not something to be dealt with by health service managers.

The Chairperson:
This is déjà vu: we had a similar conversation in an earlier meeting. We have too much of a cluster of A&E departments within the Belfast city limits. Amazing savings could be made by creating one state-of-the-art A&E department and distributing other specialist areas among other A&E departments west of the Bann, and at the Ulster Hospital at the other side.

A day is coming when we must consider the provision of specialist services — for example, coronary services — in one acute hospital. People will travel, although they may complain about that at first. They will be willing to travel inside Northern Ireland rather than going across the water, or further afield.

With regard to your last points, the Committee has already discussed many of those ideas as a potential means of making a lot of savings.

Mr Easton:
My question has been answered, more or less, but I will ask it again. Thank you for your presentation. On a visit to Scotland, the Committee discovered that the Scottish block grant was 36%. Northern Ireland’s block grant is 48%, which is substantially bigger. How they are able to do it in Scotland? Perhaps we need to take soundings from across the water as to why that is the case.

How can productivity in the boards be increased? I ask that question in light of the fact that we have had to bring in doctors from across the water — at a great cost — in an effort to reduce waiting lists for inpatient, outpatients and those requiring operations. A lot of extra money has had to be ploughed into the Health Service to do that.

What is being done to keep costs down, at the same time as reducing waiting lists? What is being done to get rid of the bureaucracy and paperwork that have greatly increased over the past 10 years, and that take up doctors’ and nurses’ time that should be spent on the front line, helping patients and treating them as quickly as possible? Moreover, in that time, there has been a huge increase in management levels. What are the trusts doing to tackle that?

Mr S MacDonnell:
When I stumble, Mr Burke will help me.

Mr Burke:
Doubtless, I shall.

Mr S MacDonnell:
I did not do any comparisons with Scotland, in preparation for the meeting. If you would like me to do so, I will go away and research the matter. I did comparisons with England, and I provided the Committee with data on the English position. However, I did not do it as a percentage of the country’s total public expenditure; I did it on a health versus health basis. Although our expenditure is higher than that of England, our need is also higher.

The experts’ reports, which I mentioned earlier, suggest that we are less efficient but we have to tackle that to the tune of £343 million. — that is alongside achieving those targets for waiting list, and the like, that were described. The way to do that is to reform the care pathway so that patients are at the most appropriate point at the appropriate time. The way to do that also is to reform the facilities to facilitate the patient’s journey, in the optimum way, along the patient pathway. That involves releasing costs by closing and reshaping facilities. I mentioned examples in County Antrim, which is in my own area — I am not so familiar with other parts of Northern Ireland. I believe that that is what will happen over the next few years.

I need to emphasise the point that the cash-releasing target will be assumed made. In other words, the trusts have no choice. The money is taken out at the start of the year. Therefore, we have to achieve that target. Next month, they have to bring forward proposals that meet the target for 2008-09, and outline proposals for 2009-10 and 2010-11. The reduction in administration, which the RPA target suggests, will take out 25% of the administration budget in trusts and, in due course, 25% in boards and other agencies. That will be a lot higher in administration reduction, than in the reduction in the clinical workforce.

It is daunting to have to say that a reduction in disciplines other than administration will be required. Efficiency savings of £343 million cannot be achieved only through cuts in administration. As I said earlier, we must plan those cuts sensitively, so that we deal with the departure of people from the Health Service in a dignified and affordable way and provide the maximum opportunity for their retraining.

The £97 million investment programme will lead to new, but different, posts for which not all staff will have the suitable skills. Some people will want to take up those new posts, and they should be afforded the opportunity to retrain. For personal reasons, others will want to take the opportunity to move on. The significant dislocation or one-off costs will make that expensive. However, if the books are to balance in health and social services over the next three years, I do not see an alternative.

The board accepts that it is not within its gift to change the CSR targets, and it must find ways to meet them. There may be some light relief along the edges, but I have not come here today to ask the Committee to guarantee our salvation. I am sure that you will do your best.

The Chairperson:
That would be one route to salvation.

[Laughter. ]

The Chairperson:
Sorry, but you provided me with the opening for that.

Mr MacDonnell:
We seek the Committee’s support. When the Budget is being debated on the Floor of the Assembly, we ask that you press the case for health and social services and explain, as we have tried to explain to you, the daunting challenges. Health trusts, boards and other agencies will do their best to deliver their part of the bargain.

We assure you that we will make good use of the £97 million investment programme, but we need to find a great deal of cash to release. That can be done only if there is political support for the unpalatable, but inevitable, re-profiling of services. Therefore, the agenda is neither ours nor yours: it is a shared agenda, and we must deal with it together.

The Chairperson:
Undoubtedly there are major challenges ahead.

Dr Deeny:
Stuart and Dominic, thank you for coming today and giving your presentations. I have enjoyed today at Stormont, because much that interests me is being discussed. Both today’s meetings have been good, and we are talking about the future.

The Chair has mentioned the duplication of services, and we discussed that this morning. I spent visited two hospitals in Scotland, where retrieval teams have been introduced. A child who is taken seriously ill — with, for example, meningitis — and is far from specialist services, is stabilised in a local hospital by an anaesthetist or consultant. The child remains there until a retrieval team is sent by ambulance, or even helicopter, to take them to a specialist centre for treatment. That seems to work extremely well in Scotland, even in remote areas, and is an interesting innovation.

When Stuart MacDonnell talked about efficiency savings right across the board and included acute care and primary care, I immediately thought that those areas affect me. I am concerned that experienced nurses will be replaced by lower-grade nurses with less experience. That is not the way to save money. I take your point that we cannot expect savings to be made purely by cuts across the board in administration, and savings should be made in areas where there is duplication of medical and nursing staff. However, staff should not be removed from an area in which they provide an essential service.

The review of public administration still worries me. As I said this morning, it is the way forward because its bottom-up approach is correct. Although I hope it does what it says on the tin, I have my doubts. Last week, I did not name the hospital that has given rise to my concern, but, as Dominic is here today, I will. A senior member of staff at Altnagelvin Hospital told me that although that hospital does not have enough cardiac nurses, a fourth tier of management is being created. Nurses have to be sent up from Omagh to help out so that the cardiac catheter clinic and ward can be maintained. People on the front line who deal with patients tell me that this review of public administration is not doing what is supposed to do. To create a fourth tier of management, and not to have enough nurses is a contradiction, and Dominic Burke could look into that.

The witnesses have said that they will be saving 25% in management costs, and the Committee accepts that, however the Committee has consistently asked for — and is entitled to — breakdowns of the following figures: the 1,700 staff who will leave the service and the £53 million which will be saved. Members want to know exactly which people are leaving. It may well be that those people are coming to that time of their lives; perhaps a teacher decides that next year is time to go. Perhaps that is the sensible way to do it. However, the Committee needs a breakdown of those figures.

I have to be honest, and Dominic Burke knows my views. I have worked in general practice for 24 years. It concerns me that more and more managers appear all over the place. I once went to a meeting outside Omagh, in the Mellon Country Inn. Most doctors, GPs and nurses could not attend because they were seeing to their patients, but there were there people from all over the place, with titles. Is this what the Health Service has become? I am not being cynical: that is simply my observation.

My questions are as follows. Tell me, if you can, about the pharmacy management programme.

Secondly, with regard to public accountability, Dominic Burke is involved with the Western Health and Social Services Board. I believe that at the end of board meetings, people can ask questions. Perhaps I am thinking of meetings of the trust: I cannot remember. I have always been concerned at the public’s lack of knowledge about people on trusts and health boards. The public has not a clue who sits on health boards or who to contact about trusts. I hope that LCGs will fulfil that role, if they are put in place.

There was mention of engaging with MLAs and the Committee, so that the public and their political representatives are fully informed. However, should commissioners of health care not connect directly with the public, rather than go through us?

I have another concern, which other members share. We are discussing money for health care over the next three years, but we have also to think ahead. A member who left the meeting, Carál Ní Chuilín, mentioned that we must also think of future health Committees and the future of health provision in Northern Ireland. I am seriously concerned to hear that PFI projects in England stack up huge debts. I would like to hear your views on that as well. Should we be using PFI projects, which can cost six or seven times as much to pay back, and which come out of the public purse? That creates problems for the next generation.

Mr S MacDonnell:
I will answer the member’s questions about pharmacy and PFI; Dominic will deal with the rest.

Mr Burke:
I will try to remember his other questions.

The Chairperson:
You have picked the short straw, there.

Mr S MacDonnell:
Although he is not a pharmacist, Dr Deeny knows much more about the detail of the pharmacy management programme than I do. In the CSR, the pharmaceutical clinical effectiveness programme, to give it its full title, is estimated to save £40 million over the three-year period.

I will read some of the headings in the programme, and all of them are over a three-year period. Generic prescribing and substitution will save £8 million; repeat dispensing, £2 million; therapeutic tendering, £3∙5 million; hospital discharge efficiencies, £2 million; non-justified treatments, £2 million. Managed entry or controlled adoption of new drugs will save £8 million; drug tariff deletions, £10 million; hospital to home, £1∙5; grey markets — that applies to GP practice rooms, and I am not sure what it is — £0∙5 million; vaccination administration costs, £1 million; and pharmaceutical clinical technology, £3 million. That makes a total of £40 million. I beg your indulgence, Chairperson; if the Committee needs someone to explain what those do for patients, the chief pharmacy officer in the Department would probably be the best person to attend the Committee.

The Chairperson:
You have more detail than we have, so we are jealous.

Mr S MacDonnell:
I turn to the member’s question about PFI. At a national level, there are some technical issues at the moment about capital projects, as to what should be on or off the balance sheet. I understand that, for that technical reason, question marks are been put against the sustainability of the private finance programme.

Let us assume that that is resolved in due course. I have no expertise whatsoever in that part of it. The basic question comes down to this: if one needs the capital but does not have it, does one take out a mortgage? If one takes out a mortgage, it must be paid back off over a long period of time. That is something in life that many of us face.

The full programme for the ‘Developing Better Services’ initiative is contained in the Investment Strategy for Northern Ireland. It shows the extent of the projects deferred outside the three-year programme. The programme for health for the next three years amounts to £714 million, of which primary and community care has been allocated £152 million,the Fire and Rescue Service and the Ambulance Service have been allocated approximately £150 million, and hospitals have been allocated £412 million. The great proportion of that money will go to the south-west and a replacement hospital in Omagh.

The Local Improvement Finance Trust (LIFT) mechanism allows the Government to bundle together smaller projects and to approach the private finance market with a major project. Sometimes £30 million or £40 million does not interest people, which is surprising. However, when figures of £400 million or £600 million, comprising 10 or 12 projects, are mentioned, they do become interested.

Dr Deeny is quite right. When such projects are taken on, there is a commitment to pay the money off. The investor will require a guarantee of a public-sector revenue stream for the life of the project. Otherwise, it is not a safe bet to invest in. It is a question for the Assembly and the Committee for Finance and Personnel to decide the extent to which Northern Ireland Plc should borrow, rather than use its own capital resources. I claim no expertise in that area.

Mr Burke:
On the question of public accountability and the work of the boards, I appreciate the confusion that exists in the minds of the public between trusts and boards and who is responsible for doing what. Historically, there has been a tradition in which boards have met local councils two or three times a year to discuss plans in the preparation stage. Following approval of those plans, the boards have gone back to find out what was happening on the ground. The four Northern Ireland boards adopted that tradition.

There is a need for trusts and boards to engage together to demonstrate that there is a single agenda for health improvement and service delivery. Furthermore, it is important for quality standards. In the west and in other areas, the board and trust meet together. Boards also meet in public, as opposed to having public meetings. In other words, the meetings are open and the public can listen to the debates, but they do not necessarily participate in them. However, it is an important way for the public to understand what is going on.

The changes that are taking place under the review of public administration and the development of the local commissioning groups can be a powerful tool. They are not up and running in the full sense that one would have liked; however, they will be a very powerful tool. They may need to be revised in some way to have more political or local representation on them. If GPs and other professionals work together alongside the community and voluntary sector, perhaps with the involvement of local politicians, that will be a positive step. That may be taking a step further in the new world, as we get into community planning and the role that local authorities will play in that. Accountability will then be very important, as councils will determine to whom the local commissioning groups will be locally accountable. That will be very positive. I welcome that approach.

The Chairperson:
I must vacate the Chair, as I have an engagement that I cannot get out of.

I just want to point out some areas in which I see potential for savings. For example, millions of pounds are set aside each year for litigation. There is an abuse of the prescription system, whereby GPs write out prescriptions for drugs that are never used. However, I will leave it to others to decide whether that is the fault of the patient or the GP. Missed appointments are another drain on resources.

We want to deliver a thoroughly excellent healthcare system in Northern Ireland, and nobody believes that that will be an easy ride. Extremely tough decisions must be made, and the Committee is just commencing its line-by-line scrutiny of the draft Budget.

Thank you both for coming today. I am envious because you have more facts and figures than we have. The prevention side of healthcare is crucial, as is education, which cuts across several Departments. The Committee has not even begun to tap into certain issues that might afford significant savings. For example, money is lost because people have to return to hospital because they have contracted major infections, such as MRSA. Such issues have the knock-on effect of adding to the cost of running A&E services.

As I said earlier, A&E services are not the only answer. Community directives and infrastructures — starting with GPs — are also crucial. I take on board the point that we can create massive savings by doing away with much of the clustering and duplication of services in the city centre, where there are three hospitals within a one-mile radius — the City Hospital, the Royal Group of Hospitals and the Mater Infirmorum Hospital.

The Committee will have to examine those areas in great detail. I thank you for your thoughtful presentations, and no doubt we will meet again.

(The Deputy Chairperson [Mrs O’Neill] in the Chair)

Rev Dr Robert Coulter:
Most of my questions have been answered already, but I would like to hear your views on the renegotiation of management and consultant contracts.

Mr S MacDonnell:
Are you referring to the new medical consultant contract that was introduced about two years ago?

Rev Dr Robert Coulter:

Mr S MacDonnell:
That matter has settled down. I hope that I am correct in saying that every medical consultant in Northern Ireland will be working to a new contract. Boards employ very few doctors; for example, I have about half a dozen and Dominic has three. Therefore, the new contracts have not been a big issue for us, and I am not sure what the situation is in hospitals. Our colleagues, the other trust chief executives, might have more insight into that issue. Alternatively, we can seek more information and get back to you — whichever you prefer.

Rev Dr Robert Coulter:
You mentioned that cuts will have to be made not only in management but in the clinician side. It worries me that, while we are spending so much money on sending people abroad for treatment, you are talking about cutting clinical staff.

Mr S MacDonnell:
That point was raised earlier. Some money was spent on what we call waiting-list initiatives during the past year or two because of short-term logjams in the number of people who are waiting for treatment. Those initiatives have been very successful and have resulted in the waiting lists being reduced tremendously. However, in the long run, if we are to reorganise services, we must live within reduced costs of 9% in real terms at the end of the three years. We cannot do that by salami slicing healthcare, so we will have to re-profile the workforce.

That will involve all disciplines, and there should be no exemptions. In some places that process will be painful, but in others, it will be relatively easy to manage because the changes that we have already proposed for Ballymena, Newtownabbey, Larne and mid Ulster, which is my own locality, are well known, and the health and social-care professions are signed up to them. People in those professions are frustrated by the time that it has taken to gain access to the capital resources in order to get on with the job.

If the central initiatives — the 1,700 posts from the RPA, the pharmacy programme that I discussed with Dr Deeny, the procurement initiatives, which is about making better use of the buying power of the NHS — are removed from the equation, approximately £250 million will remain for trusts to take out of their baselines. I know that that is a crude estimate, but we could do a basic calculation of employers’ costs on the basis of 30 posts approximating to an average of £1 million of revenue over all the disciplines. If £250 million were removed, 70% or more of which is pay costs, one could say that several thousand posts must be lost over the next few years. It will be possible to re-deploy some of those people into the new posts that the investment programme recommends. Professor McClelland said that some professionals could be retrained to move from working in a hospital setting to working in a community setting. That should be possible for a significant number, but I doubt that we could truthfully say that it will be possible for everyone. Therefore, there must be an intensive programme that manages redeployment sensitively.

The staff unions would like a guarantee that there will be no compulsory redundancy, but so far, they have not got that guarantee. Everyone is working hard, and both Dominic and I could say that the trusts’ management are committed to ensuring that those changes will be carried through with the least impact on patient and clients in the first instance and staff in the second. However, that does not mean that there will not be fewer staff; there will undoubtedly be fewer, given that cutting posts is the only way to bring costs down. Productivity changes may be achieved by using the type of waiting-list initiatives that were used previously in England. By using existing staff to carry out those initiatives in Northern Ireland, the costs of the consumables must be borne. However, the staff will still be in post. Generally, though, cash cannot be extracted unless the size of the workforce is reduced. That is the part that will be daunting over the next few years.

The Deputy Chairperson (Mrs O’Neill):
I thank you both for coming to the Committee; you have helped our deliberations.

Dr Deeny:
May I ask a quick question?

The Deputy Chairperson:
Kieran, we have been here since 12 pm today.

Dr Deeny:
Just a quick one.

The Deputy Chairperson:
Please be quick.

Dr Deeny:

Paying for the PFI is an inescapable cost — after the project has been completed, payment for it comes out of the budget for the Health Service every year. It must be paid for. Are you concerned about the loss of 600 nursing jobs? Two RCN nurses have mentioned that to me in the past fortnight.

Mr S MacDonnell:
That follows logically from my point about the purpose of the current initiatives being to release cash and invest in front-line staff. At the same time, we must re-profile the services, which will involve re-profiling skills. As boards, the organisations that Dominic and I belong to do not employ many nurses, and the new structures will soon describe and define how many nurses will be required. I am sure that there will be an opportunity for people to join the new reformed service, should they so wish. Equally, as the Chairperson said, many people will wish to leave, and they will be afforded the opportunity to do so. I have not heard the figure of 600 nurses cited, so I am not sure where that has come from.

Mr Burke:
Neither have I. The underpinning element is that it is clear that there will be significant numbers of posts lost. Therefore, the important point is to ensure that there is sufficient reinvestment to make sure that front-line staff are in place and that the service is enhanced and improved. The time that is lost between the jobs going and securing the investment to get the additional staff back into posts is crucial.

Mr Buchanan:
I have one further question to ask.

The Deputy Chairperson:
No; I will end this session. You do that every time that I am in the Chair, Thomas.

Thank you for coming to the Committee.

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