NHS bureaucracy spending doubles

Government spending on central bureaucracy in the health service has more than doubled in five years, research has found.

Opposition politicians said the figures demonstrated that the NHS had become a "bureaucratic black hole" under Labour, with money diverted away from the front line to pay an increasing army of administrators. The analysis by the Conservative Party shows that funding for the Department of Health, its quangos and regional authorities reached more than £12 billion last year, a rise of 103 per cent since 2003.

The £12.6 billion budget for central administration was seven the amount spent on either maternity services or dentistry, which each received £1.8 billion, or Accident and Emergency departments, which received £1.7 billion. Billions more was spent on administration at hospitals and primary care trusts across the country, for which specific administration figures are not compiled.

Mike Penning, the shadow health minister, said he was horrified by the findings of the report, which was drawn up by the Conservatives' research team. He said: "I am absolutely appalled, particularly at a time of such economic difficulty, by the Government's continued failure to deliver value for money for the NHS."

The report found that while staff numbers rose by 18 per cent in five years, the amount spent on them rose by 48 per cent. The rise in the number of administrators outstripped the rise in numbers of doctors and nurses. Mr Penning described the report as evidence of a "bureaucratic black hole" which was attracting billions away from patient care. "It appears that the further staff are away from the patient, the more costs rise," he said.

Government figures show there are now more than twice as many bureaucrats as midwives, and 5,000 more managers than hospital consultants. Last year the number of managers rose by nine per cent while nurse numbers increased by just 2 per cent. The average pay for a chief executive running a foundation hospital trust reached £157,000 last year.

Katherine Murphy, from the Patients Association, said: "Of all the billions poured into the NHS, it is just sickening to see how much of it has been soaked up by this ever-expanding bureaucracy, particularly these quangos and authorities who have proved unable to prevent appalling patient care seen in the scandals at Stafford Hospital, or the hundreds of deaths from Clostridum difficile at Maidstone Hospital and at Stoke Mandeville Hospital before that."

The dozens of NHS quangos funded by the taxpayer include NHS Professionals, which was set up in 2004 with a remit to reduce the amount spent on agency nurses. It spent more than £1 million employing two senior managers in just two years. The agency paid a private company £1,700 a day for chief executive John Faraguna and £1,150 a day for director of operations Stephen Dangerfield, even though body was created in order reduce the amount of money wasted by the NHS on private agencies.

Other agencies include NHS Connecting for Health, in charge of the long-delayed programme to computerise health records which has caused repeated problems in the hospitals which have tried to introduce it.

The DoH, which employs more than 2,000 civil servants, has created dozens of "arms-length" agencies and committees, including a Cosmetic Surgery Steering Group, Advisory Board on Registration of Homeopathic Medicines, Alcohol Education and Research Council, Herbal Medicines Advisory Committee, Independent Advisory Group on Sexual Health and HIV, and the Leadership and Race Equality Action Plan Independent Panel. Eleven regional health authorities are responsible for managing performance at 200 hospital trusts and 150 primary care trusts.

Mark Wallace, campaign director for the TaxPayers' Alliance, said: "The figures demonstrate that the only boom this country is enjoying is in NHS bureaucracy, and I think people are fed up with paying increasing taxes to fund a succession of quangos and back office functions when the money is needed at the front line."

The DoH described the Conservatives' interpretation of figures comparing spending on the DoH, its "arms length agencies" and health authorities in 2003 and 2008 as "fundamentally flawed" because the central budgets included some services that directly benefited patients, such as funding for childhood vaccinations and grants for social care. A spokesman said the 2008 figures also included £2.5 billion passed on to hospitals to subsidise a system of "payment by results" for operations carried out. He added: "Administrative and clerical staff form only eight per cent of the NHS workforce of over 1.3 million, and are essential to the day-to-day running of the organisation."

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Australia: An IVF baby is priceless, but who pays?



ISABELLA Zogopoulos is a gorgeous $70,000 miracle that we all helped to create. The 13-month-old was conceived after her mother, forklift driver Theona Zogopoulos, endured 10 cycles of IVF at a personal cost of $30,000. Taxpayers chipped in the rest via the Medicare safety net scheme, making the long-held dream of parenthood a reality for Ms Zogopoulos and her council worker husband, Chris. "I call her my little miracle on ice," the besotted mother says. "She was on ice for 18 months."

But without the 80 per cent rebate on the IVF procedure — the family also had other medical expenses — it's doubtful the Zogopouloses, who took out a $20,000 bank loan to cover their costs, would have been able to afford so many IVF cycles. Now, as the Federal Government scrapes for savings ahead of the May 12 budget, it is looking again at publicly funded IVF and obstetric services, which cost taxpayers $141 million a year through the safety net scheme.

The Zogopouloses fear such a move would render their dream of giving Isabella a brother or sister financially impossible. "It is very disappointing," Ms Zogopoulos, 37, says. "There are plenty of other things that the Government can look at and cut money from."

The issue of tampering with public funding for fertility services is politically fraught, as the previous Howard government discovered, because the area of assisted reproduction is emotionally charged and access to IVF is now widely accepted as a right in Australia. It is a right that is increasingly expensive: the safety net scheme, which has leapt 28 per cent since 2007, now costs $319 million a year, 44 per cent of it IVF and obstetric services.

How much taxpayers should subsidise assisted reproduction, and whether it should be means tested, remains controversial. When the Howard government tried to rein in the public cost in 2005 by limiting funding to three cycles a year for women up to the age of 42, or three in total for older women, it was a disaster. But with Labor's economic strategists now considering ways to pare back the safety net scheme, the IVF industry fears rebates on fertility and obstetric services are again at risk. Options being considered by the Government are believed to include capping the number of (now unlimited) publicly funded cycles available, means testing, and restricting access on the basis of age.

In the lead-up to the 2007 election, Health Minister Nicola Roxon pledged there would be no move to tamper with the safety net, introduced by the Howard government in 2004 to cover 80 per cent of out-of-pocket medical costs above $1111.60 in any given year (or $555.70 for low-income earners). Yesterday, Ms Roxon declined to "engage in speculation ahead of the May budget" with The Sunday Age.

But Access Australia, which represents IVF consumers, is taking no chances. It has been encouraging its members to flood the offices of Prime Minister Kevin Rudd and Treasurer Wayne Swan with angry emails. Sandra Dill, Access chief executive, argues that infertility is a medical condition like any other funded through Medicare and should not be singled out. Means testing or restricting public funding would make IVF affordable only for the wealthy, even though fertility issues affected as many as one in six Australians, she said.

IVF is now the preferred treatment for infertility, and the number of babies born with the help of assisted reproductive technology has trebled since 1995, to 11,000 a year.

"I find it curious that on the one hand the Government recognises the economic benefit of having children … and yet for another group of people who are trying to have them who need medical help they are threatening to make that even more unaffordable," Ms Dill said. She did not believe access to IVF should be restricted on the basis of age because individual doctors made decisions on a case-by-case basis and were unlikely to recommend IVF to women who had a low probability of success.

In Ms Zogopoulos' case, each of the 10 IVF cycles involved an upfront cost of $5300. The usual cycle costs $4400, but she was also using the ICSI technique, in which sperm is injected directly into an egg. Should she attempt IVF again, she will need to have a $3280, non-Medicare rebatable procedure in which cells from her embryos would be tested each cycle, to check for any genetic abnormality. The test could help avoid the previous nightmare of repeated failed implantations. But it will add to the overall cost and if rebates are cut, could mean the Zogopouloses cannot afford to try for a second baby.

Ms Zogopoulos believes the only fair cut would be a means test, by which wealthier people get smaller rebates. "I feel sorry for people just starting out on IVF. It is always very stressful financially," she said.

The extraordinary 28 per cent blow-out in the safety net bill since 2007 has been linked to the rise in gynaecologists' fees, which, according to one estimate, have increased by more than 400 per cent since the scheme was introduced in 2004. A senior Government source said the safety net had blunted competition in the health sector, allowing obstetricians to raise fees. But the president of the National Association of Specialist Obstetricians and Gynaecologists, Dr Andrew Pesce, denied that charging for IVF in Australia was spiralling out of control, saying costs were relatively low by world standards. He said the increase was due to IVF becoming the treatment of choice for infertility, whereas previously it was one option among several, including surgery.

Federal MP Tony Abbott, who as health minister in 2005 tried to implement the disastrous attempt to limit public funding for IVF, concedes now that: "If you are a fortysomething woman who is desperate to have a baby and the Government decides that the rules are going to be changed to make it harder for you to pay for this, you get very, very unhappy."

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