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NHS productivity dropped 11% compared to pre-pandemic levels

NHS productivity dropped 11% compared to pre-pandemic levels
By Beth Gault
20 May 2024

Productivity within the NHS is around 11% lower than before the pandemic, according to a report presented to NHS England’s board.

The report, written by Julian Kelly, chief finance officer at NHS England, looked at the loss of productivity following the Covid pandemic and the plan to improve it. It noted several reasons for the trend, including the increase in average length of stay for non-elective patients, higher costs of temporary staff, medicines and technologies, and the increase in depreciation and cost of capital charges.

It also noted that industrial action had a big impact on productivity in 2023/24.

It said: ‘2023/24 was also significantly impacted by industrial action. It had direct costs of around £1.2 billion and reduced aggregate activity. We estimate an impact on productivity of around 3%.

‘Based on this analysis, adjusted productivity would be around 11% lower than before the pandemic or 8% if we adjusted for the impact of industrial action.’

However, the report noted that there were some productivity gains, including over three million urgent suspected cancer referrals seen, which was a 5% increase from 2022/23.

Around 11% more patients are being admitted and discharged on the same day in urgent and emergency care pathways, compared to 2022/23.

In general practice, 2.5 million more patients are being seen a month compared to May 2023, according to the report.

Dr Layla McCay, director of policy at the NHS Confederation, said: ‘It is encouraging that this paper shows that the NHS is making significant progress in these efforts, particularly following the seismic shocks of the Covid-19 pandemic and industrial action. The strikes alone have been estimated to have cost the NHS at least £3 billion so far, yet productivity across hospitals is 5.8% higher than in 2022/23 and spending on agency staff has reduced by 13%.

‘Clearly the NHS has further progress to make and health leaders are fully committed to that. However, this will forever be a challenge if the government does not wake up to the scale of the population’s health problems and the capital investment that is desperately needed to truly modernise and transform what the health service can offer its patients.

She called on the next government to increase capital spending to at least £14.1bn annually.

‘NHS England’s paper says that failures to invest in the NHS’s ageing estate is resulting in lost clinical time and that 12,000 instances have been reported over the last two years which have stopped clinical services from being delivered to patients,’ she added. ‘With the waiting times as high as they are, it is no wonder that frontline staff can often feel as though they are responding with one arm tied behind their back.’

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