- NHS document shows trusts saved £40m in procurement during first eight months of 2016-17 financial year
- Savings achieved through NHS Supply Chain as part of its £150m efficiency target
- Procurement model set to change in October 2018
NHS trusts have delivered at least £40m of procurement efficiencies as part of a wider drive to cut these costs by £150m by October 2018, data obtained by HSJ reveals.
The savings were achieved through trusts’ use of NHS Supply Chain between April and December 2016, according to a document produced by the NHS Business Services Authority.
NHS Supply Chain is aiming to deliver £150m worth of savings for the health service between March 2016 and October 2018, when the NHS’s procurement model is due to change.
By February 2017 the organisation had achieved £60m of this target.
In his efficiency review last year, Lord Carter estimated that NHS hospitals could save £700m through more efficient procurement.
The latest data, which has been used by NHS Improvement, splits trusts into four regions.
It shows the South has made savings worth £10.9m during the eight months from April to December 2016 – an overperformance of £292,000 against the expected level of savings.
It is not clear how the other regions – London, the Midlands and the North – have each performed.
The document also included details for trusts in the South that had saved the most and the least.
North Bristol Trust was the best performing of the 64 trusts and community interest companies in this region, after saving nearly £1.1m – accounting for 10 per cent of the region’s total savings.
The trust was placed in financial special measures last summer after it ended 2015-16 with a £55.6m deficit.
The top five trusts’ savings accounted for 36 per cent of the region’s total saving.
The five trusts in the region that saved the least were mental health or community providers, with Surrey and Borders Partnership Foundation Trust saving the smallest amount at £3,354.
This reflects the more limited scope for procurement savings at non-acute trusts.
According to the NHS Business Services Authority, the NHS spends £5.7bn a year procuring goods, of which around 40 per cent – £2.3bn – goes through NHS Supply Chain.
NHS Supply Chain, which provides healthcare products and services such as, was set a target in March 2016 of delivering £150m of savings by October 2018.
HSJ asked how many of those savings have been delivered to date, but the authority said it could not release details due to purdah.
However, in a February update to the NHS Northern Customer Board for Procurement and Supply, it was reported that £60m of validated savings have been made against the £150m target.
In October 2018, the Department of Health’s “forward operating model” will begin operation, which will see the current NHS Supply Chain structure broken down into separate operational areas including “procurement towers”.
NHS Supply Chain already delivered savings worth £150m between March 2013 and March 2016, according to the authority.