'Treasury door open on capital', says Jim Mackey

The chief executive of NHS Improvement believes there could be a “door open” on capital funding from the government, but said leaders need to build a “stronger case than we’ve got now”.

Referring to capital requirements set out in regional sustainability and transformation plans, he said “nearly all” STPs are “unaffordable and undeliverable” in their current form, and a new process needs to be developed within “months” to strengthen the case for investment.

Speaking at the NHS Providers conference in Birmingham today, he said: “We’ll be developing a process around capital investment, because nearly all the plans in the STP process are unaffordable and undeliverable.

“Frankly if we did do them they’re going to sink us with a lot of fixed overhead in the future, without the investment in primary care services or mental health that we all know we need.

“There is actually I think a door open on capital but we need a stronger case than we’ve got now. It’s not sustainable to run the service we’ve got now in the future without a capital investment process that’s better than the one we have now.”

He also said there is “enormous” scope to rationalise resources across organisations, such as corporate and back office functions, as well as potential for national bodies to devolve some of their responsibilities to local systems.

He added: “So when we’re arguing with the Treasury and we’re saying we need more money - and we’re doing that every day, I did it first thing this morning - they should rightly say rationalise your overhead because it’s enormous, and it is.”

Asked later to expand on the conversation with the Treasury today, Mr Mackey said: “It wasn’t a meeting where I went asking for money.

“It was just part of an ongoing process where I was trying to get confidence of what the sector’s doing, what the NHS is delivering on, about the need for STP plans to crystallise and help us with the business case on capital.

“Generally what I’m finding is people are rational and they’re receptive, but there’s a lot going on the economy so there’s nobody going to rush to a blank cheque, and it’s going to come back to us to demonstrate the strength of the business case.”

He said there is also a “disconnect” in STP plans, which largely make a case for investment in hospital reconfiguration when the “strategic intent is to move care outside of hospital”.

He added: “So the Treasury are actually being very patient and pragmatic so far on that and giving us time to get our case together, but we haven’t got a year to do it, we’ve got months. And we need to make it very very hard for people to reject them.”