April 9, 2025 - 7:00am
According to reports yesterday, NHS trusts around the UK may have to make up to 100,000 job cuts in order to meet the target of slashing their “corporate cost” by 50%. Health Secretary Wes Streeting is once again swinging his reformist axe in order to boost efficiency in the service, with NHS leaders requesting that the Treasury cover the costs.
While pushes for efficiency are welcome given the bloat that weighs down the NHS and the rising deficits in hospital trusts, these job cuts are not cause for celebration. The potential scale of these redundancies points to Streeting pushing for too much too quickly, with the NHS Confederation suggesting the cuts could entail anywhere between 40,000 to 150,000 employees. The Confederation’s chief executive, Matthew Taylor, has therefore called for a redundancy fund, similar to that announced in the Spring Statement, for Civil Service and NHS England workers.
The NHS has clear inefficiency problems; but trusts are currently haemorrhaging money, leaving them financially anaemic and potentially unable to cover the costs of making such redundancies. The Nuffield Trust reported in February that NHS trusts overspent by around £1.2 billion last year, twice the previous year’s total. These cuts could potentially cost almost £2 billion alone, with several trust leaders reportedly budgeting around £12 million each to cover for the redundancy payments and associated costs.
With this in mind, the call for a redundancy fund is a sensible one, given the likely short-term cost of making such drastic cuts. If the payouts are entirely put into the trusts themselves, it will leave them worse off over the next few years before any benefit can be felt.
Likewise, rather than boosting efficiency, Streeting risks leaving the NHS short-staffed in order to make the necessary reforms. As the chief executives of the King’s Fund and the Nuffield Trust pointed out yesterday in the Guardian, many of these workers are specialists in driving efficiency and keeping wards adequately staffed.
It seems that this government has not learnt from the failures of the Tories, who similarly made over 10,000 redundancies over the course of their 2013 reforms. Then, thousands of those laid off were re-employed afterwards, having left the NHS short on staff able to carry out the administrative roles required. It would be counterintuitive to make these cuts — and the required redundancy payments — only to re-hire staff at great cost. Labour may have the foresight to anticipate the potential fallout, but the record of successive Tory governments is hardly a source of hope.
The NHS finds itself at a crossroads. While immediate reform is needed, Streeting can’t risk rash decision-making for the ideological change he wants, given the frailty of the service as it approaches its 80th birthday in 2028. The pressure being put on NHS trusts to meet these figures also serves as a flashback to the control-freakery of the New Labour era, which focused on target-based care at the expense of quality. NHS leaders were broadly glad to see the back of that approach; few will want to see its return under this new government.
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SubscribeVirtually all the potential redundancies are some way from the clinical front line. There won’t be doctors and nurses being made redundant here.
Not all non-clinical will get a redundancy payoff either. Some will get offered suitable redeployment and if they don’t take it they’ll make themselves redundant and not be entitled to any package.
Nonetheless for a good number no suitable redeployment will exist (e.g alot of roles in NHSE and some Corporate functions in Trusts). One can debate the merits of that, but for those affected probably a redundancy pot made available as one-off appropriate. The recurring saving will be greater within a couple of years. Most clinical staff won’t notice much.
Separate debate really how it got to having so many roles that NHS can now potentially do without. Lansley reforms increased bureaucracy away from the clinical coalface and taken too long to address that. The whole internal market bureaucracy also generated admin costs well beyond what efficiency it released. Healthcare is not quite the natural market some ideologues hope. Of course national finances have changed too so risk appetite is changing and has to too. Plus it just may be that we can’t afford all the potential new developments as these outpacing our ability to pay for them. Some of these themes are universal to all developed countries.
Labour has been allowed back into office because it is once again the most promising vehicle for the privatisation of the National Health Service in England. But only in England, of course. In all three of the other parts of the United Kingdom, the NHS is considered by all parties in favour of the Union to be their unanswerable argument, and the majority of the electorate agrees.
In 1997, Tony Blair, Alan Milburn and Paul Corrigan brought English NHS privatisation from the outer fringes of the thinktank circuit to the heart of government. Since then, it has been the policy of all three parties except under Jeremy Corbyn, and of most Labour MPs and all Labour Party staffers continuously. In 1997, Labour’s pledge card had promised to abolish the NHS internal market, and the final week of its campaign had been a countdown of days to save the NHS. Those were barefaced lies, and the opposite of the truth.
Here we are again, except that Wes Streeting is perfectly open about his bought and paid for intentions. He seeks and accepts such income streams because he agrees with what they stand for. Labour is a party of extremely right-wing people who lack the social connections to make it in the Conservative Party, and whose two defining experiences were being brought up to spit on everyone below them, which was everyone else where they grew up, and discovering in their first 36 hours at university that they were nowhere near the top of the class system, a discovery that embittered them for life.
Even allowing for Streeting’s personal opposition to assisted suicide, that is the context of its ruthless pursuit, in terms that look increasingly likely to apply only in England, by Kim Leadbeater. In 2022, a fundraiser for a future Streeting Leadership campaign was held at the Covent Garden penthouse of Lord Alli. At that time, Streeting’s running mate was to have been Leadbeater. Now, though, that backbencher of only four years’ standing has as her Chief of Staff Lance Price, long-term BBC correspondent, Special Adviser to Tony Blair as Prime Minister, and Director of Communications for the Labour Party during the 2001 General Election campaign. Think on.
Does anyone know exactly what Matthew Taylor actually does as “Chief Executive of the NHS Confederation” ? Or indeed, what that organisation actually does ? And whether it’s yet another of those duplicated quangos that’s apparently (I choose the word deliberately here) in Wes Streeting’s sights.
All I have been able to find out for certain is that he’s the son of Professor Laurie Taylor, is “media friendly” and would appear to get on well with all the right people.
As ever with these people, the “answer” is to throw more money at the problem. Somone else’s money (yours !), naturally.
With a workforce of 1.5 million, I can well imagine that 100K (around 6%) could be taken out without impacting productivity (and perhaps even improving it) since hardly anyone’s been removed for underperformance or incompetence for decades. I suspect most readers here wouldn’t have too much difficulty identifying some of these who’d be better employed elsewhere. Even if it’s beyond the wit of current NHS management.
The NHS is conducting research into what people want by conducting surveys . But all the questionnaires I have seen tend to be detailed and to ask closed questions. Would you like the NHS to be local or centralised etc ?
Nowhere are they asking broader open questions.e,g. Is a state monopoly the best model ? Is private provision potentially as good or better than state provision ? Which countries do this better for a similar cost? (Answer all of Europe) .
By asking closed questions they claim to be consulting but in truth are not./
I agree. I have been superbly looked after by the NHS over the past 18 months (cancer, surgery, looking clear 6 months later). I have seen the questionnaire and went to look. Gave up!
It read to me like the survey producers were simply looking for the answers that met their pre-conceived ideas/want/desires/hopes!
I wonder how many NHS patients could give informed, coherent answers your broader open questions?
Not that they don’t need asking, but that’s the problem with democracy (as Churchill noted).
As I understand it, the NHS employs about a million and a half people. About a third of those are actually medical staff, and perhaps another 100k are employed in direct support roles (cleaners, pharmacists, porters etc).
That leaves about 60% of the NHS doing admin. It can’t be difficult to cut that if someone a) actually wants to and b) has any idea what they are doing.
Of course neither of the above criteria are true, so Streeting’s reforms will be, as usual, all fluff and expense.
I fear that Streeting has been listening too much to those in the medical profession, and too little to those with expertise in how large organisations work. Doctors (and teachers and other professionals for that matter) tend to be opposed to the whole idea that they need to be managed. Everything apart from the work they actually do is perceived as bureaucratic burden and meddling.
Doubtless there is some of this: but effective organisations are those that are effectively managed, by managers who actually have the power to do their job. In the health service the medical profession is far to powerful for this ever to operate as it should.
All over Europe there are universally available health services far better than the NHS . Spending a similar amount% GDP – but not one is a state run monopoly.
Agreed. We should be looking at those. Many have some version of the bismarkian system.
An over spend by 1.2b is insane. Two members of my family are nurses and both have complained about the massive waste they witness along with overbearing management directives. Also, I believe contractors are paid absurd amounts for relatively small jobs, we’ve all heard about the willingness of the NHS to pay way over the odds for basic pharmaceuticals and simple stock goods such as tissues.
Isnt it high time this entire model was reviewed with an eye to a complete restructuring? The constant tinkering and trimming here and there is simply not effective enough.
This may simply be true, but often it’s about reducing transaction costs and giving tighter budgetary control.
It may be cheaper overall to buy more expensive tissues from a supplier with a good purchasing system because of the money saved on invoicing costs. Also with good integration with the in house finance system this can avoid nasty surprises down the line, as budgets can be updated instantly.
I think there has been too much emphasis on headcount here, rather than changing what the NHS does and how it does it.
The scope creep since the 1959s has been huge, driven partly by improving technology, coupled with a very understandable desire to fix problems if it’s technically possible to do so.
Unless that is addressed head on, the NHS will always need more money per citizen, year after year.
It’ll be another ham fisted slash and burn, where large numbers are laid off only to be reemployed as contractors on 3x the wages a short while later.
The NHS needs trimming, but I have little faith that this will be done effectively
What proportion of NHS employees does 100,000 represent? What proportion of NHS spending does “almost £2 billion alone“ represent? How do levels of NHS employment and expenditure compare to (say) 10 years ago, and to levels in other countries? Why would staff targeted for redundancy be “specialists in driving efficiency” necessarily? Why not just select other staff, or low performers? Without any of this context it is hard to judge the validity of the assertions made here.
Broadly speaking (I could detail if needed) as someone who works in the field.
2bn – just over 1% of 1 year. Not major as they are expected to find 2 or 3% per annum anyway.
Compared to 10 years ago about 15-20% (allowing for inflation) more expenditure and about 15-20% in employment. This accounts for increasing number of older people living longer and being kept alive longer.
No comparison to other countries. Overall we spend 20-30% less as % of GDP though in other comparable sized European countries about half is private insurance funding model – dedicated NI equivalent to private schemes.
As for ‘targeted for redundancy’. They are 10,000s vacancies in any case. So it is pure conjecture on author’s part.
That is not correct as a % of GDP the NHS compares badly. It matches most of Europe for a far worse service.
It also tries to do much more than most services though (GP visits, some dentistry etc) and others have had the larger budget for much longer so tend to have built up more capacity during previous years
Yes, I just looked up the OECD figures and Japan, with a much older population, spends less per capita then the UK, and has a vastly superior service where you get seen almost immediately, and can choose whichever clinic you prefer.
I think around 6% as the total headcount is around 1.5 milllion. So 100K wouldn’t be at all off the scale in the private sector. Where such cuts and reorgs aren’t heretical and can sometimes even increase productivity. And luxury beliefs (the sad EDI interlude excepted) don’t override common sense.
Frankly, sometimes it’s enough to take out any 6% to send out a signal that management is actually serious. A major problem in the NHS clearly being that management hasn’t been so for decades. And that the staff all know it.
So the Tories couldn’t reform it, Labour now can’t reform it. What is the solution? Almost everyone has come to the conclusion that the NHS is broken. The problem is I see no solutions here. Unherd needs to commission people who have actual plans, not just what we can read in the mainstream: complaints about how bad the system is or complaints about how attempts to fix things are doomed to fail/are failing. We can’t go on like this. Rory Sutherland had a good line – in a publicly funded healthcare system the incentive is for doctors to complain and ask for more money whereas in private healthcare the incentive is for doctors to say everything is great and gloss over failure.
The solution is not to start with a state run monopoly.
This really is past satire, past parody even.
To make itself more efficient, the NHS is planning on reducing the number of workers, many of whom are specialists who drive efficiency.
This will reduce costs. Except they can’t afford to do so, unless they get more money.
Just to repeat.
The NHS now needs more money in order to reduce the amount of money it needs by improving efficiency by reducing the number of workers who drive efficiency.
And the government needs a new department to oversee these expensive cost savings. Those laid off from NHS can fill the new department, but will all need extra DEI training and so a ministry of DEI should be formed. And everyone is paid equally. Paradise!
True reform would be to identify and ‘stop doing unnecessary things’. Merely reducing headcount is a ham-fisted way of dodging the issue while (trying) to look good.
You’d be amazed at how often it’s the latter that happens though – in the private sector too.
The idea mooted by this writer (a doctor) that there’s workers in the NHS who “drive efficiency” is arrant nonsense. He might’ve pointed to particular roles, except they don’t exist.
Some staff are efficient, and strive to encourage efficiency in their colleagues but are invariably ground down by ‘the machine’… and the unions/professional bodies. Yes, i do have experience in this matter.
Another shibboleth… “targets at the expense of quality”. So how do we measure quality? It used to be through watching each others backs by the medical profession, with awards and monetary incentives.
Targets are intended to be a means of helping to determine where things are going wrong. Included in that is such things as ‘number, or ratio of clinical errors’, both per hospital and per individual consultant. No wonder they’re unpopular!
The first place to start the cull is anyone remotely involved in DEI. Hospital HR departments which exist – apart from their basic function and CRB checking – to make sure no-one is ever taken to task for failing when the entire focus should be.on serving the public.
All change costs money, including change to improve efficiency. Even where there is low hanging fruit, it is often hard to identify, and those who know it best are often those will an incentive to keep it hidden.
All this is a bit academic in any case. What should really be happening is looking at health systems around the world which work better, and developing a completely new model for the U.K.
Low hanging fruit sits in the Low Effort / High Impact quadrant. If the fruit is low hanging, why has it not been picked already? Some label this box Quick wins, which often turn out to be not quick and not wins. Instead, the focus should be on the High Effort / High Impact quadrant, aka the Too hard box that mostly goes unopened.
As the NHS consumes a higher % of GDP than Switzerland and the same %GDP as Germany, France, Sweden, Belgium etc- all of who have far better systems – none of which are state monopolies- why does the NHS need more money ?
If they are specialists at driving efficiency why are the trusts in deficit? What is it with health services that they can’t live within their budgets?