From the moment Gordon Brown announced his plans for a huge cash injection into the National Heath Service the critics had a single refrain. Aware that they could not carp at the intention behind the scheme, instead they cried loudly that they hoped the cash would not go on higher wages. That, they said, would be a waste of money that would lead to no improvement in the service to patients.
To anyone from the technology industry that argument sounded very strange indeed. In any major IT project staffing is one of the biggest charges – in many cases, the biggest by some way. Software, hardware and other infrastructure costs remain significant, but when you call in one of the big IT consultancies or systems integrators, you are facing fees for a senior consultant of around £2,000 a day. Even the most junior team members can be £500 a day.
So when the announcement came that the government would be pledging a further £45m to a major NHS technology modernisation project I couldn’t help wondering why the critics didn’t stand up and demand that the money should not be ‘wasted’ on IT staff costs. A technical consultant can cost as much as several nurses – surely we ought to worry about the terrible potential for this money to be wasted?
Though no breakdown has yet been provided, it seems likely that a substantial proportion of the increase in spending on technology in the public services will be accounted for by staff costs. And that increase is fairly huge – the government is planning a £6bn IT spend across all its departments.
There is no doubt that better use of technology will transform some aspects of the public services, which have been woefully under-equipped for decades. Paper filing systems, long since banished in private sector firms, remain the norm in many hospitals, schools and other departments. Frontline nurses, for instance, can spend a quarter of their working day dealing with paperwork. If they were equipped with handheld computers they could access patient files immediately, fill in new details, and save hours every week currently spent walking to and fro with bits of paper.
GPs’ surgeries could benefit in similar ways, cutting down on waiting times to see the doctor. Other basic systems like appointment booking could be made more efficient; a recent small-scale pilot found the high number of missed appointments could be cut to only a few per cent with a system that sent out automatic reminders to people. And this is just the beginning.
It makes sense to spend highly on technology, given the expected returns, but to spend prudently staff costs must be taken into account. The critics who want underpaid nurses to put up with their current wages may be confounded by the staff shortages that plague the profession. In today’s climate such shortages could be reduced by careful technology spending. It should be possible to strike some excellent bargains over IT costs at present.
What’s needed is a consistent approach to IT spending across government. Too many IT projects are undertaken in isolation, and few lessons are learned from the many well-publicised failures. For many years this isolation was accentuated by the trend in government to outsource IT functions where possible. Yet there is evidence that, though it can appear to save companies money in the short term, outsourcing may be a more expensive option in the long term than keeping an inhouse IT staff. And if there’s one thing government ought to be, it’s long term.
Perhaps, then, one of the main focuses of public sector IT policy ought to be to recreate the sort of inhouse IT experts that fell out of favour in the early 1990s. Instead of spending so much on external consultants, the public services could be made more self-reliant.
How much should public sector IT staff be paid? Probably less than their private sector counterparts. The terms and conditions of work for public sector employees often surpass those of the private sector. Public sector pensions are widely regarded as more generous and more secure than their private sector counterparts. Job security also looks better in government employment.
And there is also, as many civil servants admit, the satisfaction of working on projects that are of national importance, and the hope of making people’s lives better as a result.
Spending on modern technology in the public services is one of the most important issues of the day. While penny-pinchers scrutinise the salaries of public sector workers, they should cast a more careful eye on where the technology spending is going. There are no fat cat nurses, but no lack of fat cat IT consultancies.
Fiona Harvey is technology writer for the Financial Times