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‘Devolved Health’ - will it turn a national funding crisis into a local one?

Will the drive to devolve health and social care turn a national funding crisis into a series of local crises, or is there much more to it? We asked Matthew Macnair-Smith, Policy and Research Manager at the NHS Confederation.

Greater Manchester is the most high profile example of a devolution deal but different deals are being agreed in a variety of places up and down the country. 

Coming at a time when both health and social care are feeling the combined strain of tightening finances and an ageing population, with increasing numbers of patients living with multiple complex conditions, it isn’t just the cynics that have suggested that the devolution of powers from central government to local leaders may leave local leaders accountable for service failures and spiralling financial deficits. Some of those who are even more cynical have suggested that this was the intention behind the policy. So what is the truth about devolution and what will it really mean for the NHS?

One could surmise that devolution of health provision was not really on the cards at the outset of the devolution policy. A quick word count of the first draft of the Cities and Local Government Devolution Bill didn’t feature the words ‘Clinical Commissioning Group’ and the ‘NHS’ did not do much better. It seems that the potential implications for health devolution may have been an afterthought, for a policy that has mainly being lauded as part of a drive to self-sustaining and more autonomous local government. The full potential implications of the Bill on health became better understood as it progressed through Parliament and led to the drafting of some extremely crucial protections. 

The C&LG Devolution Act does not force devolved arrangements on to any local area. The Act is a piece of enabling legislation that requires Secretary of State and a Parliamentary affirmation in order to sign off any transfers of power. Furthermore, local areas have to go through the process of agreeing a deal with central government regarding the specific responsibilities they want to take on locally, and in the case of any proposed transfer of health functions, the deal also has to have the agreement of NHS England. To further stifle concern, it is clear that with regards to health, we have not necessarily seen a sudden, huge demand from local areas, asking to have substantial elements of health in their deals and it is apparent that many are keen to see how Greater Manchester pans out first.

The area of greatest concern to our members was around those aspects of the Act which  makes joint decision-making between a local authority and CCGs more practicable, by enabling commissioning functions and financial resources to be transferred to joint commissioning boards, but with accountability arrangements unchanged (i.e. existing accountabilities would be retained by NHS England and CCGs). However, this kind of joint planning and budget pooling isn’t anything new, as Section 75 of the NHS Act 2006 already allows local authorities and NHS CCG budgets to be shared, most notably demonstrated by the Better Care Fund. However the scope of Section 75 is limited to resource sharing between NHS CCGs and Local authorities.

The provisions in the act allows this to be taken a step further, recognising  the scope of some devolution plans may make it necessary to transfer functional responsibilities from a public authority such as a government department or NHS England, to a combined or local authority. The Bill sets out that this would be bought about by an order from the Secretary of State and says that it would be accompanied by a corresponding transfer of duties, accountabilities and resources. 

This provision will potentially allow some local areas to have much greater control over the planning and delivery of services that are currently outside the remit of local authorities and NHS CCGs, particularly those held by NHS England which has responsibility for commissioning specialised services. It allows those areas the scope to shape a much wider array of services than current legislation would permit.

Some feared that this would mean local authorities could take on commissioning of health. This has at least partly been addressed and the importance of having a clinical voice in any commissioning decisions has been recognised in the safeguards in the bill that ensure that at least one of the prescribed bodies that form part of a joint commissioning board, must be a CCG. 

Adopting a broader focus

These provisions are seen by many as a new opportunity to do things differently and to take a broader focus across the range of services that affect the health and wellbeing of their local populations. The extent they make use of this will depend on the specific local situation. The Greater Manchester deal, for instance, will include funding for specialised services, devolved from NHS England. Other examples from the current devolution deals being developed include:

  • The proposed Gloucestershire deal, which includes specialised services (except highly specialised) and some aspects of primary care from NHS England and public health funding (including for immunisation and screening) from Public Health England. 
  • The proposed deal in Wiltshire includes devolved funding from Health Education England to be spent on addressing local workforce issues. 
  • Cornwall’s deal includes the commitment to produce a business plan for the integration of health and care services.
  • North East CA has committed to ‘establish a commission for H&SC integration for the North of England including deeper collaboration and devolution’. To report by summer 2016.
  • West Midlands CA Devo deal announced with a focus on Mental Health.
  • Liverpool CR Reference to further discussions on health and care devo.
  • London has announced health pilots, looking at key themes across the city

We are aware of other areas, which have asked for place-based multi-year budgets, control of immunisation and screening services; control of NHS estate; support to buy out a private finance initiative (PFI) scheme; and increasing financial allocations.

It is not yet clear what any of these proposals will lead to, there are several concerns around the possible consequences of the deals, not least that they could create increased variation between areas in the prioritisation of different services. Responding to this, we have said that it is important that local leaders prioritise services to most effectively meet the specific needs of their local populations, but it is also vital that the NHS remains a national service with all people endowed with the same rights to access a service, regardless of how their local services are organised. It is encouraging to see that NHS England, which would have to sign-off on any transfer of health functions has taken this on board and has clearly stated that any area wishing to have devolved health will have to agree to the principle that ‘All areas will remain part of the NHS, and are thus bound by national standards, statutory duties, the NHS Constitution and Mandate requirements’.

Unknown consequences

There are also undoubtedly unknown consequences for the way accountability and regulation works. Policy makers and national bodies involved in regulating health and care services will need to start to think about the way that they regulate emerging new models of care including large scale integration in areas with devolved status. National bodies and regulators should develop a more system-wide lens to regulation, recognising that accountability for services is becoming increasingly blurred and more integration means that the effects of one service will be more readily felt by another. 

Equally important, we need to ensure that any lessons from Greater Manchester are learnt from, this model cannot be used as a blueprint for change in other areas and local leaders will need the freedom to develop solutions which are right for their individual situations. The partnership working and plans in Greater Manchester occurred without central government action. They are the culmination of work over many years to forge local relationships and agree shared priorities, based on a shared understanding of the population’s health needs. Creating the culture to enable this type of relationship takes time and effort and local leaders will need to be supported to do this.

Greater public engagement required

A major criticism of Greater Manchester has been the lack of public engagement. Some people have described the plans as ‘secretive’, when the deal was announced some GPs locally described it as a ‘shock’. The very nature of the process involved in agreeing a devolution deal, by which local and central government officials meet behind closed doors has been criticised for its lack of transparency. In Greater Manchester it has led to a public campaign against elements of the plans. The success of devolution plans is heavily reliant on local people’s support and it is important that proposals tap into their knowledge and experiences. Devolution should not simply replace Whitehall control with Town Hall control and if it is to be meaningfully locally driven it will need to engage widely with the local population.

It is also important that we don’t get carried away and think that devolution is a panacea or silver bullet. Several members including those from Greater Manchester and Cornwall, have highlighted that the process of having to agree a devolution deal has acted as an important catalyst for them to start to have difficult conversations about how best to plan and deliver joined up services and the necessity to produce a plan has proven instrumental in bringing health and local government leaders together to start to agree changes. However, some areas have instead chosen to utilise existing freedoms and mechanisms. There are some localities, particularly those who have already forged strong relationships across health and other services, or where the CCG and local authority is co-terminous, where a formal devolution deal is not felt to offer anything new.  

We are yet to see the full effects of devolution. So far, we can see that it could offer some areas the opportunity to do things differently and take a broader focus across the range of services that affect the health and wellbeing of their local populations. However, the reality of the freedoms that local areas have been given may not meet the rhetoric and devolution brings with it a whole panoply of new questions and concerns about variation, regulation and accountability which will need to be addressed. Whilst it would seem overly cynical to agree that devolution will simply localise funding problems, it is also impossible to see how the small number of unambitious deals including health will solve financial problems. 

Matthew Macnair-Smith
Policy and Research Manager
NHS Confederation

Tags: devolution

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