The savings the NHS estimates it will need over the next four years are more than £1bn lower than the often-quoted £20bn target, the health secretary said this week.
Andrew Lansley told MPs on the Commons health committee on Tuesday: “The total expectation across the service as a whole is that [strategic health authorities] are anticipating themselves delivering something like £17.5bn of total efficiency savings.
“There’s about £1.5bn on top of that which is deliverable through central budgets. That leads to anticipated total savings of £18.9bn.”
He added that the Department of Health itself had estimated that the total savings required would be £18.7bn, in order to fund improving services and cope with rising demand and inflation.
NHS chief executive Sir David Nicholson told the committee the DH could not report on actual savings progress for another three months. Even then he doubted it would have a “definitive answer” to how much of the progress was due to one-off savings that did not reduce costs recurrently.
Asked if managers had the political support required to make the large scale service changes needed in the savings programme, he said: “I have to say this does, in my experience, depend on where you are in the electoral cycle.”
He said the recent decision to allow reconfiguration at Barnet and Chase Farm Hospitals Trust had an “iconic” significance for managers, and which sent a “powerful message” that it is “worth taking that extra effort to get change through”.
Pressed on his attitude to providers’ attempts to “re-grade” staff to reduce paybills, Mr Lansley insisted he was not aware of “trusts who are seeking to reduce their costs by downgrading existing staff”.
He added: “I’ve talked to the Royal College of Nursing, this is not actually an issue for them, they haven’t raised it with me.”
In April, Royal Cornwall Hospitals Trust was involved in a dispute when it tried to reassess staff roles as part of a £19m savings drive that could have led to workers being re-banded at a lower level on the Agenda for Change pay framework.
A Chartered Society of Physiotherapy survey last week found 70 per cent of physiotherapy managers who reported safety concerns had also seen a “downbanding” of jobs.
A Royal College of Nursing report last year found 9,973 posts that had been subject to discussions about cuts, including re-banding.