£31bn bill as NHS computer cost soars

by GRAEME WILSON, Daily Mail

Last updated at 08:11 12 October 2004

A computer system planned for the Health Service could end up costing taxpayers £31 billion, it is claimed today.

That would be five times more than the £6.2 billion Ministers have set aside to pay for the project.

The disclosure raises the prospect of billions having to be plundered from frontline patient care to pay for the computer network.

The project - one of the biggest information technology programmes in the world - is meant to revolutionise the way the NHS works over the next decade.

Ministers claim the National Programme for IT will allow patients to go to their local GP and book a hospital appointment at the click of a button.

The system will also hold electronic medical records on every person in the country. It will even be possible to send X- rays, test results and prescriptions electronically.

But the cost of introducing the far-reaching reforms could blow a hole in the NHS budget, says a report in the magazine Computer Weekly.

It reveals that a senior official from the National Programme recently told a private meeting the implementation costs would dwarf the £6.2 billion set aside to buy the system.

He estimated that these would add another £12.4 billion to £24.8 billion - meaning the final bill could be anywhere between £18.6 billion and £31 billion.

Cash needed to train staff

This money is needed to train 800,000 staff, including tens of thousands of doctors and nurses, in how to use the system. It will also cover the cost of hiring locum and agency staff to fill in when those staff are away on training courses.

Millions more will be spent hiring specialist staff to convert data from existing computer systems so it can be used on the new system.

It is estimated that £31 billion would build 434 hospitals or pay the annual wages of 1.8million nurses.

Following previous government computer projects which have ended with huge cost overruns, the National Audit Office has launched a pre-emptive inquiry. It hopes to report next summer on whether the initiative is on track and good value.

System must deliver

The Tories have backed the idea of creating a new NHS computer system. But health spokesman Andrew Lansley warned: 'The Government needs to be transparent about where the extra costs will fall.

"Many health trusts are in deficit and would struggle to find money for a centrally-imposed project of this scale, without seriously cutting local service delivery."

A British Medical Association spokesman said: "This system has the potential to improve patient care but we need reassurance that it will deliver."

A spokesman for the Department of Health said: "It is generally accepted in the IT industry that implementation costs are three to five times the cost of procurements and this is reflected in the business case made for the National Programme.

"The implementation costs should be seen in the context of the record levels of investment going into the NHS.

"Over the ten-year period from 2003-04 we would expect total NHS spend to be around £1,000 billion. This means the cost of the National Programme over the ten-year period will equate to between 1.5 per cent and 3 per cent of Trusts' expenditure."

£3bn for 'expert advice'

Consultants have creamed off £3 billion from Britain's aid budget in the past five years, it emerged yesterday.

Money which should have gone to help poor countries was instead paid to companies for their 'expert advice'.

The Department for International Development spent £700 million on 'technical cooperation', the official term for consultants and researchers, out of its £3.97 billion budget last year alone.

It has spent £500 million to £715 million on such services for the past five years.

International Development Secretary Hilary Benn was yesterday urged to explain the payouts to Parliament.

Alan Duncan, Tory spokesman on international development, said: "We need aid delivered to the front line, not to rich consultants who will tell us things most of us know already."

A Government spokesman said consultants' fees were good value, saving money in the long run and helping to improve skills in the countries where the work takes place.