Making change possible: A Transformation Fund for the NHS

Fundamental change is needed, but how?

Changing population needs combined with a prolonged funding squeeze have placed our health service under intense pressure. It is widely recognised that continuing with ‘business as usual’ is not an option – doing so would open up a significant funding gap and mean an NHS that is unable to meet the needs of the English population.

As our Chief Economist, Anita Charlesworth, and her counterpart at The King’s Fund Richard Murray argue in their recent article for the Health Service Journal, ‘the NHS needs to keep calm but “just carrying on” is not a sustainable strategy... Now, more than ever, we need a new, systematic and comprehensive approach to supporting and implementing change in the NHS, accompanied by dedicated investment.’ 

They are co-authors of our new report, written jointly with The King’s Fund: Making change possible: a Transformation Fund for the NHS. The report argues that the NHS needs a dedicated Transformation Fund, with appropriate funding and expertise, to deliver the change required. The right policy context for change and effective practical support are also critical. A new approach to change will need to be routed in engaging staff in new ways of working. 

A dedicated Transformation Fund is needed

Our report sets out the case for a dedicated Transformation Fund, which would accelerate changes to the way that health services are delivered. It would enable the shift to new models of care as set out in the Five Year Forward View, as well as helping to unlock the efficiency savings required across the English NHS to balance the books. The Transformation Fund would not only deal with the current urgent need for transformative change but would, in the long term, become a fundamental part of the NHS bringing longer-term focus on continuous improvement. 

We have made recommendations on how the Transformation Fund should be administered to ensure success, which would see the Fund become a permanent fixture of the NHS, with objectives that develop to address future challenges facing the NHS as they arise. We also discuss the first objectives for the Fund over the next five to ten years, recommending that dedicated funding of £1.5–£2.1bn a year is needed, which will require additional investment over and above the £8bn increase in the NHS budget pledged by the government by 2020.

Key findings from the report

• The NHS needs a single body (whether within an existing organisation or newly created) to oversee the investment for transformative change in the NHS. It should have strong, expert leadership which is credible to clinicians and managers.
• Key to successful change is the engagement with, and investment in, staff. At its heart the task facing the NHS is to get over one million people to work differently. To do this, front-line staff must have time away from the day job, and this won’t happen unless it is properly resourced.
• While the Transformation Fund requires far more than just money, there is a need for dedicated investment of £1.5–£2.1bn a year between now and 2020/21. While bringing together existing strands will go some way towards this, more resources will be needed above the £8bn increase in NHS funding already announced by the government.
• The introduction of the Fund would involve two phases:
  1. The first phase (2016/17–2020/21) would be split into two strands: an Efficiency Strand, which would look to achieve higher rates of efficiency growth across all services, and a Development Strand to invest in new models of care. 
  2. The second phase (2021/22 and beyond), would focus on widespread roll-out of the successful new models of care. This would include double-running costs associated with these new models.
• Further consideration should be given to generating transformation funding by the development of the NHS estate into a long-term sustainable source of new income.

The huge challenge to reform care

The report recognises that delivering the change required in the timescales will be a huge challenge. We’re not just talking about organisational change, but reforming the way care is provided to patients, day in, day out, across every part of the health and care system. 

Anita Charlesworth says, ‘We recognise that it is challenging to provide additional funding for the NHS in the context of other services receiving cuts, but the alternative is to risk a decline in quality and safety in NHS-funded care and a reduction to the services currently available.

‘Without more resources specifically for transformation, the NHS will be unable to become more productive and the bill for additional running costs will only get larger. The Transformation Fund should become a fundamental part of the DNA of the health service from now.’

Learning from other examples of transformational change

The report is the result of nine months of research into other examples of transformational change, from within the health sector and beyond. These are provided as detailed case studies in the report, but are also summarised here: Six examples of large-scale transformation and what we can learn from them.

This month we also look at some other programmes aiming to bring about transformational change. Our Director of Strategy and Innovation, Jo Bibby, gives us an update on the NHS Innovation Accelerator, a fellowship programme the Health Foundation is involved in delivering alongside NHS England, UCLPartners, and the Academic Health Science Networks (AHSNs). The programme aims to create the conditions and cultural change necessary for proven innovations to be adopted faster throughout the NHS.

We also speak to Don Redding from National Voices about the Realising the Value programme – another collaborative project aiming to transform the way the NHS provides care by empowering communities.

Find out more

Download the full report: Making change possible: a Transformation Fund for the NHS.