NHS England’s chief executive has said the government may need to change the law because competition rules are standing in the way of improvements to NHS services.

Speaking at the HSJ Commissioning Summit last week, Sir David Nicholson cited a series of examples where he believed measures to drive up quality had been obstructed by the new rules, which came into effect under the 2012 Health and Social Care Act.

He insisted the government had not intended the NHS’s reformed system of competition regulation to have the effect it was now having.

“All of [the politicians who drew up the Health Act] wanted competition as a tool to improve quality for patients,” he said. “That’s what they intended to happen, and we haven’t got that.”

In one case, Sir David said a foundation trust chief executive had been told he could not “buddy” with a nearby trust − under plans announced last week to help struggling providers − because “it was anti-competitive”.

He continued: “I’ve been somewhere [where] a trust has used competition law to protect themselves from having to stop doing cancer surgery, even though they don’t meet any of the guidelines [for the service].

“Trusts have said to me they have organised, they have been through a consultation, they were centralising a particular service and have been stopped by competition law. And I’ve heard a federated group of general practices have been stopped from coming together because of the threat of competition law.

“All of these [proposed changes] make perfect sense from the point of view of quality for patients, yet that is what has happened.”

He said NHS leadership and policymakers needed to return to “the intent” of the health reforms, adding: “I know the secretary of state would be prepared to take legislation back [to Parliament] if that’s what needs to happen”. If this was the case, he warned, “we have to do it quite quickly, because this will stop us making the big [service] changes needed”.

Sir David went on to describe “four tests” he believed politicians should meet to support the NHS − a reference to the “four tests” set out by the government in 2010, which NHS service change proposals must pass before they can proceed.

First, Sir David called for politicians to be “completely transparent about the consequences of the financial settlements” the health service had received. He said: “The politicians are sitting there saying, ‘We’ve given [the NHS] real terms growth − what is the problem?’ That’s not right, it won’t work.”

Second, he said politicians needed to actively champion service change: “Don’t stand back from it, but actually get out there explaining where service change is required and advocating it.”

He then called for “no more top-down reorganisations of the NHS” − an echo of statements made by the Conservative party before the 2010 general election. He added: “Not even ones that you pretend aren’t [top-down reorganisations].”

“We cannot spend another two or three years looking at our navels,” he warned. “There’s no appetite for… organisational change dreamt up by politicians.”

Finally, he said politicians should “nurture and support [the] clinical and managerial leadership of the NHS”.

Sir David, who is due to retire in the current financial year, said commissioners needed to lead major changes to services or the NHS’s future would be under threat.

He said the government had shifted its emphasis in recent months from the role of commissioners to that of regulators, and warned of the risk of commissioners being disempowered.

“Regulation is good [and] we should strengthen it and provide safeguards for patients and the public,” he said. “But regulation is not going to improve quality, improve outcomes or make the NHS more patient-focused. The main driver for all of that is strategy, planning, service redesign - commissioning.”

He said: “If you go down the route of incremental change and [regulators] batting everyone over the head, you end up with our job being managing the dying days of a universal service free at the point of use. So I think clinical commissioning groups [if they achieve service change] will save the NHS.”

The summit was held behind closed doors under “Chatham House rules”, but Sir David agreed to allow his comments to be published.



Exclusive: Competition rules hold back quality, says Nicholson