Feature / Sustainable development

Some thought that the NHS Trust Development Authority’s sole focus would be getting trusts through to foundation status. But the organisation believes its role stretches much wider. Steve Brown reports

The NHS Trust Development Authority was set up as a temporary body just to support NHS trusts to achieve foundation trust status. Correct? Wrong, says Bob Alexander, the authority’s director of finance. The reality, he insists, is very different. And while a whole FT economy might be a marker of success for the authority, its role while it is here is much broader than a narrow focus on organisational type.

The 2010 NHS white paper – the forerunner to the Health and Social Care Act 2012 – in fact envisaged all trusts would ‘become, or be part of, foundation trusts’ by 2013/14.

This timescale suggests a development authority’s work should be done by now. But 22 months after being established as a special health authority and a year after taking on its full statutory responsibilities, the bulk of its work lies ahead and its role is much greater than many would have envisaged.

‘When the NHS TDA idea was first mooted back in the white paper, people thought it would be a small consultancy-type organisation overseeing the foundation trust milestones,’ says Mr Alexander.

‘But if you look at where we are now, we’ve got more organisations still in the trust sector than were envisaged to be in it the outset and our remit is wider.’ In April last year, the authority had an NHS trust sector of 103 NHS trusts with a combined turnover of some £30bn. This compares with the 60 or so trusts that were originally expected to still be in the sector at this point.

The TDA’s wider remit is also evident, Mr Alexander adds. ‘For example, look at the intensity of work we’ve undertaken with other partners to ensure the response to things like winter pressures,’ he says. ‘I don’t think people ever envisaged we’d get into the service performance agenda that we are in.’

Playing a part in this agenda is a natural consequence of the authority’s defining purpose, he suggests.

‘The objective is not simply to deliver foundation trusts. Instead, the fundamental focus is on high-quality, sustainable services.’ Foundation trust status is a by-product of delivering and demonstrating this quality and sustainability, he adds. ‘If you worry about the organisational form before the high-quality sustainable services, you’ve got it the wrong way around,’ he says.

With 99 trusts still in the trust pool (following three FT authorisations and the dissolution of South London), Mr Alexander refuses to put a deadline on when all organisations may move to a sustainable form. 

Of its 99 charges, 12 trusts have been identified as unsustainable in their current form and, to use the jargon, are pursuing an organisational transaction. For some, where solutions have been identified, this will mean acquisition by an existing FT, while for others it will mean merger. (In the specific case of NHS Direct, it means dissolution and the transfer of contracts to other organisations). However, five other organisations have yet to reach a preferred solution, although franchising is also a possibility. Beyond the 12 trusts, options are also being explored for two further trusts.

Some suggest the end of 2017/18 as a realistic guess for when the last NHS trust might transfer to a new form. But the current context makes it difficult to predict how trusts might move through the FT pipeline.

‘The landscape has changed both in terms of finance and quality,’ says Elizabeth O’Mahony, TDA deputy finance director. While the estimated £30bn funding gap by 2021 provides a broad context, the financial challenge is expected to really earn its ‘unprecedented’ description in the next two years. The better care fund – which could lead to £2bn less being spent on acute care in 2015/16 – is one dimension of this.

But the focus on quality and the patient has also intensified as a result of the Keogh and Francis reports and the appointment of the new chief inspector of hospitals. This changed landscape has undeniably slowed the FT authorisation process down, but Ms O’Mahony believes the TDA has built the right foundations and support mechanisms to help trusts move towards sustainability. ‘Our ambitions are growing,’ she says, pointing to the requirement for the first time in the NHS for providers to produce five-year plans. ‘The first year has been about building the team, establishing the processes and the frameworks and setting the ambition. We’ve been through an annual cycle and now it is about using these frameworks to get trusts fit and ready for the future.’

Mr Alexander believes the TDA needs to ‘resource up’ to meet the growing agenda and as a consequence of its greater ambition – it will be bigger this time next year than it is now, he predicts. But he also acknowledges that as it becomes more successful, it will need to flex back down again.

Five-year plans

The five-year plans are key. This is how local health economies will demonstrate they have a coherent plan to move towards sustainable services. They will also clarify where the TDA needs to concentrate its support.

‘From the five-year plans, I want a clear sense of the direction for all the organisations that are accountable to us,’ says Mr Alexander. ‘Something that says: “If organisation X delivers this and that and we help in these areas and in this timeframe, it ought to be able to meet the FT challenge because it can demonstrate [it can achieve] safe services, good quality and financial sustainability”. And if not, we can have a mature conversation about looking for an alternative approach.’

Ms O’Mahony believes that the process should flush out the problems. ‘There is a finite amount of resource for five years and a baseline of efficiency that can be achieved, and then you need strategic decisions for closing the gap,’ she says. ‘That could involve the provider doing something differently, not at all or in a different setting.’

Greater cost-effectiveness with no reduction in quality is the clear requirement.

Ms O’Mahony adds that some health economies have been putting off taking difficult strategic decisions about how services will be provided in future. But the current financial environment and the anticipated challenges in the next few years mean they have now ‘run out of road’ and need to take a longer term view.

Sue Lorimer, TDA business director for the north of England, says the TDA is working closely with its counterparts in NHS England and other stakeholder bodies. ‘We meet or call fortnightly and have agreed how we will ensure clinical commissioning group, specialised commissioning and trust plans are aligned,’

she says. ‘We’ve agreed a local process and we have been clear [with providers and commissioners] that we will triangulate assumptions in the different plans and take them back if they don’t align.’

This will go beyond looking for agreement in planned activity and look to see that there is also agreement on the strategic decisions that will deliver those activity levels and ensure services are sustainable. ‘There has to be alignment between provider and commissioner expectations – and that means commissioners have to be clear about their commissioning strategies so that providers can respond to that,’ says Mr Alexander. The level of system transformation needed should fall out of that process, he suggests.

No one is under any illusions that the transformation of healthcare services is easy. The experiences with the Trust Special Administrator recommendations in South London Healthcare NHS Trust and for Mid Staffordshire NHS Foundation Trust demonstrate this. It is clear that the NHS still has some way to go in explaining and selling transformative change to the public even when strong arguments are put forward for both quality and financial improvement across broader geographic areas.

Ms Lorimer, however, suggests that there are signs of transformation getting under way.

‘If you look at Mid Yorkshire [which recently received health secretary approval for transformation plans], it had a substantial deficit, but the new management team has engaged with MPs, local stakeholders, CCGs and area teams to explain its plans. So there is evidence of some fairly radical transformation of delivery going on,’ she says.

This will need to be replicated across England. But solutions can only be delivered by whole health economies operating in partnership, jointly analysing the challenge and formulating the solution. Joint working at national and local level will be key to the health service’s future success. The TDA believes it is a key member of this team. ‘Given the system is quite fragmented, we are working between CCGs, areas teams and trusts to get business cases supported, to agree transitional funding and to solve legacy issues,’ says Ms Lorimer.

‘No single organisation can address these issues anymore, and we are the glue in liaising with all these organisations. Someone has to be the go-between and it tends to be the TDA.’

Mr Alexander accepts that there are some within the trust sector who still ‘feel they are subject to old strategic health authority performance management’. But he believes that the TDA’s overarching role is to support the improvement and sustainability of services. Referring again to the five-year plans, he says the ‘most important thing is to get local health economies to confront the reality’.

‘The status quo, or squeezing the balloon a bit more, will not address the clinical and financial sustainability issues of the NHS in England,’ he says.