NHS's got talent: will the white paper lose it?

The English NHS needs to think about how to retain good staff as many of its constituent organisations are abolished

One of the key challenges that the NHS faces in the wake of the coalition government's proposed radical reorganisation is a major drain of the talented staff it needs to ensure a smooth transition from one commissioning model to another.

The proposals laid out in the white paper, Equity and Excellence: Liberating the NHS, include abolishing today's 152 primary care trusts (PCTs) and 10 strategic health authorities (SHAs) within three years. Meanwhile, the government will hand 80% of the NHS budget currently handled by PCTs to an unspecified number of newly-created GP commissioning consortia.

At the same time, the NHS will be expected to find £20bn in efficiency savings and cut management costs by 45%.

Press coverage has also indicated very heavy cuts to management costs. According to HealthInvestor magazine, PCT and SHA management expenditure currently stands at £1.85bn annually. But an email to NHS managers from health secretary Andrew Lansley seen by that publication said that the figure could be reduced to £850m by financial year 2013-14 following the commissioning changes.

The Sunday Telegraph reported that the reorganisation would likely result in an estimated 30,000 back room managers and staff, which includes IT, being axed.

And senior NHS sources have told Health Service Journal that the government may give the new GP consortia an annual management allowance of £9 to £12 for each patient they cover. This would equate to a total budget of £450m and £600m across England.

As a result of such cost cutting proposals, Jon Restell, chief executive of union Managers in Partnership (MiP), said that the current planning assumption, particularly on the commissioning side of the equation, was that between a third to a half of management members would either lose their jobs or be redeployed.

His concern is that such a radical revamp will simply distract attention away from running existing services effectively during the financially straitened times to come. "It's a hugely challenging thing to deliver in a short period of time if you're trying to cut managers by between 20% and 30% but are asking them to introduce huge change and keep staff motivated in their posts."

Restell adds that the white paper said "very little" on the workforce and management implications of the proposed changes, dedicating only two lines to the issue. But if such uncertainty continues, the worry is that the "best people will start looking for opportunities elsewhere", which could lead to a "very big drain" if the transition is not handled well, he believes.

"The question is what's in it for them to stay? They'll stay if they see light at the end of the tunnel, but they'll be asking 'will I get a job?' and 'will the NHS support me in getting a job in three years time?'" Restell says. "If not, they'll start looking out for 'me' and take their skills elsewhere. There'll be a lot of talk about incentive payments, but it's more about job futures."

Talent spotting

Andy Lowe, practice leader at career consultancy Right Management, agrees. He believes that the hiatus period between "telling people what is going away (in job terms) but not what they're replacing it with is a very risky time for the NHS," because of the uncertainty that such a situation engenders.

While Lowe is not yet seeing CVs landing on his desk, he is nonetheless already "hearing stories and anecdotes of people starting to move".

He says that the theory of managing change suggests that it is crucial to know "who your talented people are, to start painting a picture for them of the future and ensure you keep nurturing them".

There is a tendency to try and stabilise the entire organisation, but in practice this is likely to be too much of a challenge. "So it's about identifying the crucial few key roles and skills that you'd be in real trouble if you lost. It's also inevitable, however, that the very people you want to retain are probably the ones that are the first to be snapped up when their CVs appear on the market," Lowe says.

The situation is generating other concerns. One, according to MiP's Restell, is that backroom administrative staff and managers will be given large sums in redundancy and pension pay-outs before being hired again by GP consortia, either directly or in a consultancy role, and possibly even at higher rates.

"So you need a strategy to get staff from one part of the NHS to another and you need to know what skills you need. Not something based on wishful thinking that you don't need managers or proper IT, but a strategy based on a much more resourced, evidence-based approach," he says.

As a first step in attempting to clarify a muddy situation, Gill Bellord, director of workforce advisory body NHS Employers, said that NHS chief executive Sir David Nicholson requested in a letter sent to all trust chief executives that staff affected by the proposed changes be given the opportunity to speak to their line managers by the end of September.

"We welcome this support and encourage all organisations to ensure that measures are in place to provide support and advice for all staff," she added.

Another good sign is that Sir Neil McKay, who is currently chief executive of NHS East of England, has been appointed to work alongside the Department of Health's director general of the NHS workforce Clare Chapman. His new role will be to oversee the lead coordinators for transition who are due to be appointed to each SHA.

Right Management's Lowe explains: "He's been tasked with coordinating the people transition response so we may see some coordination of downsizing activity, although it's not clear yet."

But he believes that such coordination would nonetheless be vital to ensure that the 2% of their budgets – £2bn in total – that PCTs have been required to put aside to manage the transition is not wasted on staff simply being paid to leave before being rehired.

"We recommend that they have some central redeployment processes and tools, where displaced people can go and see where the jobs are elsewhere, that is managed centrally," although it might also be possible to build on the existing NHS Jobs service, he adds.

As for the likelihood of industrial action as a result of the proposals, which include the possible dismantling of national pay bargaining, MiP's Restell believes it is too early to say, not least because the white paper is "so huge" in terms of its implications.

"Many member organisations are having to spend a lot of time working out just what it might mean. It's so big that they can't quite see around the edges so no one's in a position to say 'we're going to fight'. What we do know, however, is that it's very radical and the timescales proposed make it a very risky venture," he concludes.

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