NHS IT needs "external scrutiny"

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Delays and a failure to properly audit the £12.4 billion NHS' national programme for IT (NPfIT) means the long term benefits and costs are difficult to assess, a report has found.

The spending review, by Sir Derek Wanless for healthcare thinktank King's Fund, called on clarity from Connecting for Health, the body rolling out the NPfIT: "It is recommended that Connecting for Health is subject to detailed external scrutiny and reporting so that forecasting of long-term costs and benefits can be made with more confidence." The report also warned against a tendency for the structure of contracts to create monopolies.

Despite the billion-pound price tag, the report - a follow up from a 2002 edition - showed more money needs to be spent, in cost effective ways, for the ICT plans to work. "Future productivity and quality gains envisaged in the plans for the NHS and reflected in the future forecasts of costs require the effective use of ICT budgets," the report said. "There is much money still to be spent."

The 2002 review said ICT was key to improving productivity and health gains, and recommended doubling ICT spend for the following year. Spending on ICT from central government has increased since 2002, when it totalled 18 per cent of the overall NHS budget. As of this year, it's expected to hit 45 per cent, driven by large increases in capital spending.

But the actually spending has fallen short of expected amounts. The NPfIT is expected to cost £12.4 billion over the decade to 2013, but delays to system deliver has meant spending hasn't matched investment. As of March 2006, spending on contracts from two and three years prior was £654 million, compared to the expected £1.4 billion.

"The fact that actual spending fell short of these projections by around £0.7 billion in

2003/4 reflects the well-documented problems and delays that have beset the NPfIT and have the potential seriously to undermine the productivity gains envisaged by the 2002," the report said.

The report noted that spending would catch up this year, with an expected outlay of £2.9 billion, up from £2.3 billion last year. But it report warned: "There is as yet no convincing evidence that the benefits will outweigh the costs of this substantial investment."

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