The National Audit Office report on the efficiency of NHS Supply Chain

The National Audit Office (NAO) has now concluded their report on the efficiency of NHS Supply Chain (NHSSC) in improving procurement for the NHS.

The report was to assess whether the needs of the NHS are being met in terms or service quality, timeliness of goods delivery, and quality of goods. It would also evaluate how well NHSSC is equipped to address any obstacles to efficient and effective procurement.

The report considers:
If NHSSC was set up effectively
If NHSSC has met its objectives
How well placed NHSSC is to address any barriers to efficient and effective centralised procurement.

The conclusion of the report is as follows:

While NHSSC has the potential to generate savings for the NHS, it has not yet fully realised this potential. It is crucial to deliver the right products to the NHS at the most cost-effective price in order to maximise the value for patients.

To achieve this, NHSSC should aim to be in a strong negotiating position. By encouraging as many trusts as possible to utilise NHSSC for their purchases, it can consolidate a significant portion of the NHS's spending power.

NHSSC acknowledges that its current systems and processes do not meet the needs of all customers and recognises the need to improve and demonstrate that it is the best-value option for NHS procurement. This includes optimising prices for customers, simplifying the ordering process, and ensuring reliable delivery of orders.

On the other hand, trusts must also take advantage of the purchasing efficiencies offered by NHSSC. While NHS England (NHSE) has taken some positive steps to encourage and, where possible, require trusts to utilise NHSSC more effectively, it acknowledges that more can be done in areas such as providing clinical sponsorship and standardising prices.

NHSE also needs to clarify the roles and responsibilities of all parties involved in the system and ensure that they are aligned to optimise the effectiveness of NHSSC.

For more information on the report, please click here.

In response to the NAO Report, Supply Chain issued the following statement on their website on 12/01/2023:

NHS Supply Chain welcomes the National Office Audit (NAO) report and its recommendations. The redesign of our operating model supports our capability to implement the report’s recommendations.

We are committed to continuing to work together with the Department of Health and Social Care (DHSC), NHS England and system partners across the country to improve procurement in the NHS, which will be achieved through ongoing collaboration, partnership working and innovation.

Through our quarterly national forums, regional advisory forums, Voice of the Customer Team panels and working groups, we are working with our NHS partners to understand their needs better. This work supports our goals to make improvements in satisfaction with our services.

NHS Supply Chain is aiming to deliver a new savings target of £1 billion by 2030 working together with our NHS partners, suppliers and NHS England. We are adopting NHSE savings methodologies to ensure alignment with how the system recognise savings and it’s expected that this method will be ready for all parties to use to calculate savings from April 2024.

We have embarked on a major transformation programme to upgrade key legacy IT systems. We will need to further improve and integrate our platforms to provide a more consistent experience for our customers and suppliers. As the NAO report highlighted our funding is managed on a year-by-year business cycle in line with NHS England’s business planning process.

NHS Supply Chain is committed to realising its full potential to deliver greater savings and efficiencies alongside a broader value proposition focussing on supply chain resilience, product safety, enabling access to innovation, social value, sustainability and ethical considerations.

Our new target operating model went live on 1 August 2023 and is designed to better meet the needs and expectations of the NHS and deliver greater efficiencies and value for our stakeholders. It supports our vision to make it easier to put patients first and our strategy to buy smart, supply right and partner expertly.

For further details, please click here.