Ministers were warned yesterday by the outgoing chief executive of the NHS that the drift towards excessive centralisation of the health service was in danger of squeezing out the local initiative essential for meeting patients' needs. Sir Alan Langlands, who steps down as NHS chief executive in August, gave his first public indication of concern about the direction being taken by the government in its review of the service.
He told health service managers at the NHS confederation conference in Glasgow that staff needed to be able to look up to their local bosses and respect them for doing innovative things.
"I don't think that happens much now because people don't have the space to reflect on the work they are doing. They don't have enough time - given the torrent of instructions from the centre - to work through the needs of their local communities and to manage them in a way that makes sense locally."
He added: "We need to keep a balance between a centralised service and a decentralised service."
It was not inevitable that the national plan for health, due for publication next month, would draw power further towards the centre in Whitehall.
Ministers were taking an inclusive approach to working out ideas for reform, drawing a wide range of experts into the six action teams that are preparing the ground for the national plan. But Sir Alan added: "The real inclusion has to start when the implementation stage is reached ... You [the local health authority and hospital managers] need to have some discretion to drive your part of the system in a way that makes sense locally."
Sir Alan was addressing fears raised by health service managers that their freedom of movement is excessively restricted by orders from Whitehall designed to fulfil political targets.
The national plan is expected to include a wide range of additional targets to reduce waiting times at every stage of health service activity. The health secretary, Alan Milburn, is expected to address the problem in a speech to the confederation tomorrow. It has been working on proposals which give health authorities that are achieving targets more freedom to choose how they invest capital and set local objectives.
The conference heard the first detailed exposition of Conservative plans to "dramatically extend" the private health sector by encouraging employers to support new forms of insurance for their staff.
Liam Fox, the shadow health secretary, also pledged that a Tory government would scrap Labour's decision to merge the two top jobs in the health service, head of the NHS executive and permanent secretary at the department of health.
Dr Fox said insurance schemes were inflexible and expensive. "If patients know that the most serious conditions will be guaranteed treatment within a maximum time under the NHS, there will be no need for them to seek inclusion of these in private health care policies."
So the Tories would "dramatically reduce costs in the personal health insurance sector". They would increase demand by removing disincentives, such as the tax on employees' benefits in kind that nets the Treasury £368m and extra national insurance on employers that adds £100m to their health insurance bill.
Under the Conservatives, the NHS would "remain a comprehensive not a core service, free at the point of use and funded from central taxation". He added: "We will match the spending plans of the present government, but we will also seek ways of expanding private provision on top of this."
Stephen Thornton, chief executive of the NHS confederation, said Dr Fox's plan was unimaginative. Although the NHS might buy marginal spare capacity in the private sector, it would suffer if that area expanded significantly. There would be competition for a scarce supply of doctors, pushing up prices and reducing productivity, he said.
