Published: 05/08/2004, Volume II4, No. 5917 Page 24
Noel Plumridge wonders if PCTs need finance directors
What attributes do you need to be the finance director of a primary care trust besides possession of an accountancy qualification, broad shoulders (for carrying blame, of course), and what the human resources profession politely calls 'well-developed negotiating skills'?
According to a survey of 50 PCTs by the Hudson recruitment consultancy this spring, you will not necessarily need any particular commercial experience. Nor will you need to work full time. Two-thirds of today's PCT finance directors are not full-time appointments.
This last point surprised me. I have some personal experience of working as a part-time finance director, and It is not straightforward. Several years ago, while working as finance director of a trust, I suggested to my chief executive that during the summer I might reduce my duties to four days per week.He agreed all too readily - just possibly because a way of finding the board's contribution to that year's savings programme had dropped painlessly into his lap - and the experiment began.
The logic behind my proposal was this. If the finance director is obliged to work flat out from January to April agreeing contracts, managing year-end and balancing the budget, then surely less input is needed during the 'quieter' summer months.
If 100 per cent is essential in March, could 80 per cent suffice in July? That was the logic: the vision was sunny afternoons at the cricket with a deckchair, a floppy hat, ice cubes chinking in a glass of lemonade and lime juice, and Somerset 300 for two.
I found, of course, that summer in the NHS is not really 'quiet' any more. I learned that when it comes to working hours, 'flexibility' takes some managing.
And it also became quickly apparent that, certainly in finance and especially for men, part-time working at senior level is still deeply counter-cultural.
Other executive directors were wary: if it worked, perhaps they would be pressured into doing the same at some future date.And the old hands, my colleagues in the local finance community, were openly sceptical. To their eyes the job simply could not be done in less than the traditional eight days a week.
Actually the world of commerce and the NHS broadly concur on this. 'In our experience, ' states Hudson's report, 'in the private sector, the role of financial directors managing budgets of this magnitude is almost invariably full time'.
And in the NHS, most of the supposedly part-time finance directors are so classified because they carry another brief within the PCT: typically commissioning or performance-monitoring, occasionally information or managing the estate.
The finance director job readily expands to encompass areas that a canny finance director would control anyway, or which seem to call for a similarly methodical and gritty approach to their management. Or, just possibly, which no-one else wants.
The stereotype of the tough, practical, hard-headed finance director is reinforced, in restructuring after restructuring, as board posts are defined and reporting responsibilities allocated within the team. 'Who's going to lead on local delivery plan monitoring?' they ask. By and large we know the answer.
These are serious responsibilities. But perhaps the comparison with the private sector, and the assumption that directing finance alone is a fulltime job, has a flaw. There is a fundamental difference between managing a PCT budget and managing budgets of a similar size in the commercial world (think Costa Coffee, think Wessex Water, think Lastminute. com).
The PCT is not a free-standing company, but the local branch of the NHS. Its autonomy and liberty will always be constrained by policy created higher up the NHS food chain.When it comes to freedom, its chief executive actually has more in common with a Marks & Spencer branch manager than with the managing director of a plc.
What does this mean for the finance director role in PCTs?
Essentially, that along with some tasks that are truly about strategic management and defining financial direction (such as the challenges all PCTs face as they try to balance demand and resources in the brave new world of patient choice and payment by results) the job description will include plenty that is more akin to operational management, often in non-financial areas, or about ensuring compliance with government direction.
There is no reason why the genuine 'director' component of the finance director job cannot be separated and undertaken part time. Nor, come to that, is there any reason why a capable finance director cannot be shared between PCTs.
But if a part-time finance director is a credible option for a PCT, it is harder to imagine finance directors without commercial experience in the NHS of the future, at least on the provider side of the operation. The government aspiration of provider diversity, of a 'mixed economy' in health, is rapidly becoming a reality.
Most visibly this is taking place in acute care, with serious NHS money going to independent treatment centres, and foundation trusts'NHS status appearing increasingly ambivalent as the new structures emerge. But it will also surely be so within chronic care. PCTs are already being leant on heavily to adopt the Evercare case-management model. It cannot be long before they are pressed not to recreate an Evercare equivalent within the NHS, but to commission chronic care direct from UnitedHealth Group or similar organisations.
And in this environment, health finance career paths are likely to weave between foundation trusts, PCTs and independent sector providers.
An attractive CV at director level will include spells in, and hence practical awareness of, all sectors. In future our skills may well be specific to healthcare, but are much less likely to be specific to the NHS.We could be about to see the demise of the NHS accountant.
Noel Plumridge is a former NHS finance director and a monthly columnist for HSJ.