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Hospitals £1.5bn spending strategy revealed

Hospitals £1.5bn spending strategy revealed

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Hospitals will now be able to directly compare how much they spend on products through a new strategy aiming to slash the amount spent on procurement. 

Announced today, the ‘price index’ aims to drive improvements by making hospitals more accountable for what they spend. 

An NHS ‘procurement champion’ with private sector experience will be hired to drive better procurement practices across the NHS. 

The government believes more than £1.5 billion could be saved though the drive. 

Health Minister Dr Dan Poulter said: “We must end the scandalous situation where one hospital spends hundreds of thousands more than another hospital just down the road on something as simple as rubber gloves or syringes, simply because they haven’t got the right systems in place to ensure value for money for local patients. 

"This kind of poor resource management cannot go on, and this radical new strategy will help our NHS get a grip on wasteful spending to drive real change and improved procurement practices so that more of our NHS’s resources can be spent on frontline patient care.” 

Better Procurement, Better Value, Better Care: A Procurement Development Programme for the NHS shows there is inconsistency in the way that different parts of the NHS spend money, highlighting that few hospital executives know what good procurement is. 

NHS Confederation chief executive Mike Farrar believes the strategy could help the NHS to get “more bang for [it’s] buck”.

He said: “The move to ensure more information is available about what NHS providers spend on goods and services could allow many to learn from the best and become smarter about what they are spending. 

“It could also help commissioners, patients and tax-payers hold them to account for making the best use of their money. But the process of doing this needs to be helpful without being overly bureaucratic, and must recognise providers' right to run their businesses in the way they believe is best for their patients.” 

However, Farrar added that poor procurement processes are only one part of NHS inefficiency. 

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