Corporate report

Independent review of the NHS Business Services Authority: final report and recommendations

Published 23 March 2023

This was published under the 2022 to 2024 Sunak Conservative government

Applies to England

Foreword

I am delighted to introduce the review of the NHS Business Services Authority (NHSBSA).

Having been involved in advising NHSBSA 15 years ago - just after its formation - and, before that, 2 of its predecessor bodies, it has been fascinating to see how it has developed and grown.

From being primarily a labour-intensive payments processing organisation, it now provides many of its services digitally. It is able to provide valuable data insights to improve the running of the NHS and has shown its value to the NHS, particularly through the speed with which it was able to stand up over 50 new services during the coronavirus (COVID-19) pandemic.

It is no wonder that, as a result, it has become a ‘go to’ organisation for the Department of Health and Social Care (DHSC) when new services need to be set up or existing services improved. However, therein lies a danger if it is asked to do too much too quickly, and if a focus on improving performance of existing services is neglected.

The leadership of NHSBSA is aware of these risks and has approached this review in a commendably open way - proud of the organisation as it is, keen to improve further, and open to challenge on areas where more could and should be done.

I and the arm’s length body (ALB) review team are grateful to them for their co-operation. This openness and commitment to the work of the authority is also reflected in the strong culture and values of the organisation, which shone through in our discussions with the staff of the authority.

At a time when the NHS is under immense pressure, it is vital that there is a relentless focus on ensuring that money is spent efficiently and effectively, and that health outcomes are improved. NHSBSA has a vital role to play in achieving this within the wider NHS and, to enable that, there needs to be an even closer working between it and NHS England. The report highlights areas where this can be achieved, but also areas within NHSBSA where even greater efficiency can be attained over and above existing plans.

Finally, I would like to express my thanks to the ALB review team and the departmental sponsor team for their advice and support for the period of the review. I will look forward to seeing the continued development and growth of NHSBSA over the coming years.

Chris Nicholson, Independent Lead Reviewer

Executive summary

Public bodies are a vital component of how the government delivers policies and public services. Therefore, they must be accountable and transparent, and their responsibilities and functions must be clear and necessary.

The Cabinet Office launched the Public Bodies Review Programme to assure the government and the public that:

• public bodies have appropriate governance and accountability arrangements in place
• they are carrying out their functions efficiently and effectively

The COVID-19 pandemic has stretched public bodies. It has required them to respond and adapt at pace and scale to unprecedented challenges. While the government acknowledges that public bodies have been instrumental in delivering national policy throughout the COVID-19 pandemic, the National Audit Office and the Public Accounts Committee have highlighted the need for government to go further in supporting public bodies. It is therefore critical that public bodies are reviewed to ensure they are supported in delivering the government’s strategic objectives.

Within the Department of Health and Social Care (the department), public body reviews are conducted by the ALB review team. The ALB review team is independent of the department’s policy teams. The department appoints independent lead reviewers to oversee these reviews.

Review scope

NHSBSA is the department’s first public body to be reviewed under the new review programme. NHSBSA had its last independent board effectiveness review in 2019, and its last commercial review was undertaken in 2016.

Due to recent changes in personnel within the NHSBSA Board and significant changes in its business, the Secretary of State for Health and Social Care determined that NHSBSA should be prioritised for a review. The review further serves as a mechanism to explore potential opportunities that could benefit the wider health and social care system.

The Cabinet Office guidance requires the review to consider 4 areas:

• accountability
• governance
• efficiency
• efficacy

This review has given particular consideration to efficiency and efficacy in line with NHSBSA self-assessment and the review’s terms of reference.

The chief executive officer (CEO) of NHSBSA will be responsible for agreeing a plan to implement the review’s recommendations in partnership with its departmental sponsor team. For recommendations that fall outside the remit of NHSBSA, the sponsor team shall co-ordinate within the department and oversee delivery to enable recommendations to be taken forward. The ‘Summary of recommendations’ for the review is detailed below.

Methodology

The methods relied upon for this report were a combination of desk research, observations, semi-structured interviews and workshops.

Reports, surveys and presentations from NHSBSA and the department were examined to understand NHSBSA’s business model and services. The ALB review team observed staff in the contact centre, which provided a means for understanding the complexity of work and the knowledge processes that support NHSBSA services.

Interviews were conducted with over 25 different stakeholders. Semi-structured interviews were also held with suppliers and comparable organisations of NHSBSA, and policy customers within the department. In addition, interviews were carried out with end users of NHSBSA’s services such as pharmacists and dentists, and the NHS Retirement Fellowship (as a representative of the NHS Pension Scheme members).

Staff workshops were organised at NHSBSA’s offices in Newcastle and Fleetwood, where 65 staff members participated. These workshops provided useful insight into NHSBSA’s culture, and facilitated discussion on issues such as recruitment and retention.

Lastly, this review considered legislation, including the National Health Service Act 2006, to assess the legal remit of the powers afforded to NHSBSA.

Structure

This report comprises the following sections:

• overview of NHSBSA
• public body assessment
• accountability
• governance
• efficiency
• efficacy
• capabilities
• conclusion

Main findings

Public body assessment and delivery model

NHSBSA meets the Cabinet Office criteria to continue as an ALB. The review considered the functions of NHSBSA and assessed whether it should be:

• abolished
• brought into the department
• merged with other bodies
• outsourced

The review deems that the functions are critical to the delivery of an effective NHS system. NHSBSA is best placed to deliver value for money for the taxpayer in its current form as a special health authority.

Accountability

The department and NHSBSA have an effective working relationship at sponsorship level. This has been achieved through good sponsorship governance arrangements to support planning and ensure that NHSBSA achieves its targets through regular reviews of its performance.

The sponsor team has sufficient oversight of risk management in NHSBSA and assurance of potential risks. These are dealt with appropriately and in accordance with the department’s risk management strategy. The review considers that NHSBSA has a particularly effective sponsor team with good and detailed knowledge of NHSBSA. This has helped to ensure that NHSBSA remains a high-performing ALB for the department.

The review notes that ministerial engagement has been infrequent in recent years - owing largely to the COVID-19 pandemic. The planned reinstatement of annual ministerial accountability meetings from 2023 should remedy this.

NHSBSA has a good working relationship with policy teams across the department. There is good collaboration with policy customers, which has ensured the delivery of important services. Similarly, NHSBSA has a positive working relationship with NHS England (NHSE).

NHSBSA is a key delivery partner of NHSE and performs essential business services for NHSE which supports the wider working of the NHS. However, both NHSBSA and NHSE feel that there is opportunity for them to develop their relationship and improve their strategic working relationship further. The review considers that this should be a key strategic priority that the CEO of NHSBSA and the CEO of NHSE (or a nominated member of the executive team) should work to improve in the long term.

While the relationship between the department and NHSBSA is positive, the review finds there would be merits in establishing a quarterly customer board with NHSBSA. Due to the range of services that NHSBSA provides for both the department and NHSE, a customer board would help to ensure that all parties are updated of developments and ensure that NHSBSA is able to prioritise between customers if required. As a result, this approach will improve service delivery and customer experience.

Governance

NHSBSA has a good governance structure. The NHSBSA Board (the board) has sufficient oversight across the organisation with several board committees that regularly report to the board across their areas of responsibility.

The board is effective, and a key strength is its decision-making. It also has experience and expertise, through its executive and non-executive board members, to scrutinise the areas of service delivery, and support the setting and development of NHSBSA’s strategic direction.

The leadership team at NHSBSA is also particularly robust due to its mix of private and public sector experience alongside experience in digital development and IT delivery, human resource management, organisational design, financial management and large scale operational delivery. This balance has enabled NHSBSA to be in a position to respond to unprecedented challenges during the COVID-19 pandemic.

The leadership team at NHSBSA is extremely people focused and has been instrumental in creating a working environment for its members with a strong emphasis on diversity and inclusion. While NHSBSA has taken positive steps to increase gender diversity within the leadership team, it has a lack of ethnic and disability representation in both the leadership team and the board.

The review notes that, as part of NHSBSA’s Diversity and inclusion strategy 2022 to 2025, NHSBSA has set out a range of initiatives to ensure continual improvement from a diversity and inclusion perspective. The review considers that this is an area in which NHSBSA should continue to focus, with a formal review of progress to be carried out in 2 years.

Efficiency

NHSBSA has a proven track record of delivering efficiencies. Since NHSBSA was created in 2006, it is £115 million per year more efficient than in 2006. This represents a rate of improvement of 2.7% per year over the period - although, in the latter part of the period 2015 to 2021, this has tailed off to a rate of 1.15% per year. There are a number of possible explanations for this, including taking on an increased number of services, transformation and its pandemic response.

Benchmarking evidence shows that NHSBSA’s cost and performance is generally good across its business areas. NHSBSA has used its core capabilities and expertise in technology and digital transformation to drive significant efficiencies. Through automation in its primary care services, NHSBSA has reduced its prescription processing whole time equivalent (WTE) by 90% from about 2,000 to nearer 200. It has also deployed staff from these services to deliver new services required by the department and NHS.

With regard to its workforce services, the cost of the NHS Jobs service benchmarks favourably against other similar programmes. In its pensions administration, while it compares relatively well on cost comparisons, it appears to be still some way below very best in class (after adjusting for scale) and compares less well in terms of the customer offer.

In citizen services, NHSBSA contact centre benchmarks appear cheaper compared with private sector comparators. However, performance over the past 2 years has been inconsistent, with a decline in average speed to answer times and abandonment of call rates. Although there have been more recent improvements in response due to the actions taken by management, this is an area where NHSBSA could make further improvements.

Additionally, benchmarking shows that NHSBSA’s back-office services perform well in comparison to its peers, with most being in the lowest quartile of cost compared with like organisations.

The terms of reference of this review require NHSBSA to deliver efficiency savings of at least 5% in resource departmental expenditure limit (RDEL) funding from the department, which should be achieved by the body within 3 years. NHSBSA has identified 5% business efficiency savings that it is committed to deliver through, among other things, estate rationalisation and digital projects.

The review considers, however, that there is scope to deliver savings beyond this level of at least a further 5%. For further efficiencies to be released, this would require a combination of changes in policy stance by the department and increased focus on efficiency by NHSBSA. While not directly leading to a reduction in RDEL (as it is funded by a levy on NHS employers rather than directly by government), there is also scope for NHSBSA to improve efficiency and performance within its pensions administration by getting closer to the best performers in terms of customer experience and scale-adjusted cost.

NHSBSA has plans in place to digitise further its pensions services, which should help to achieve this.

To help to drive these efficiencies, the review recommends that NHSBSA should establish a programme within 6 months that identifies the unit cost for key prioritised services to monitor over future years and ensure continuous improvement through strategic target-setting. NHSBSA should also consider expanding its resource management allocation tools across more business areas to generate further efficiencies. The review further recommends that NHSBSA should give a renewed focus to overall customer experience and performance, including by further benchmarking its services in line with best practice.

In addition to generating savings within its own organisation, NHSBSA also has a good track record in identifying and enabling the realisation of further efficiencies and improvements in effectiveness within the NHS system. These have amounted to, on average, £271 million per year over the period 2015 to 2022. The review further determines that there could be significant efficiencies generated under a ‘national efficiency programme’. NHSBSA has already identified system efficiency savings totalling approximately £1.2 billion over the period 2022 to 2026, which would require collaboration across the system.

There are further potential system efficiencies and improvements in effectiveness, which have been classified into those that can be realised in 12 months, 24 months or longer term. Scoping the potential size of these should be an early departmental priority in line with the review’s recommendation for a national efficiency programme. This could be achieved by NHSBSA working alongside system partners to deliver wider system efficiencies from the funding that flows through its services, systems and platforms. The review believes that this could be realised across numerous initiatives such as:

• medicines and data optimisation
• provider management
• health and care management
• fraud prevention

The review notes that a potential constraint on NHSBSA’s continued success could be senior management capacity and focus. Given the size of the potential system efficiencies and of the transformation of additional services, there needs to be a balance in management focus between internal NHSBSA efficiencies and the achievement of system efficiencies. To the extent that there is a trade-off, the review finds that the potential size of system efficiencies should take priority over internal NHSBSA efficiencies.

In addition, the review considers that NHSBSA has an appropriate approach to judging how to deliver its services through insourcing and outsourcing. However, the department does not regularly review whether NHSBSA should continue to deliver services for the department or use outside contractors. The review therefore recommends that the department should establish a programme to review, at appropriate and regular intervals, whether services should continue to be delivered by NHSBSA or by private contractors.

Efficacy

NHSBSA monitors and reports on its effectiveness regularly through its balanced business scorecard to its leadership team, board and the department at its Quarterly Accountability Review meetings.

Given the wide range of services which NHSBSA provides, it has a large number of key performance indicators (KPIs). It has consistently achieved 90% or more of its KPIs in recent years. Given the critical importance of NHSBSA services to the functioning of the NHS (for example, payments to dentists and pharmacists or maintaining the Electronic Staff Record (ESR) from which the information for payments to NHS staff is drawn), high performance is essential, which NHSBSA consistently maintains. This is acknowledged by the department in its annual accountability report. The review notes that areas where NHSBSA performs relatively less well is in some of the customer-facing KPIs, but it performs relatively well in financial management.

NHSBSA provides extensive shared services to organisations across the health system. Its various models include:

• its HR and recruitment services
• its procurement and other back office functions
• the NHS Jobs portal
• its primary care services
• its contact centre

NHSBSA’s primary care services carry out processing and payment services to pharmacists and all dentists in England. Its transactional capabilities in making payments at a national scale are a key strength of NHSBSA. There could therefore be merit in extending its primary care services to more NHS professionals, including general practitioners (GPs) and optometrists. The review recommends that this should appropriately be scoped to weigh up the costs and benefits.

The contact centre is another key strength for the organisation, which was evidenced in the role it played in the government’s COVID-19 response. The review finds that a scoping exercise should consider the feasibility of NHSBSA becoming a contact centre hub and providing this shared service more widely to other ALBs. It might also be a system asset to stand up in future crises as an emergency contact centre.

Moreover, in order to align with the government’s wider strategy for shared services, the review finds that there may be opportunities to extend NHSBSA’s HR shared service provision to other ALBs, with the potential for savings. The review understands that the department is currently working with all health ALBs to determine what further use could be made of shared services. This is welcomed and is in line with the review’s conclusions and recommendations.

NHSBSA’s data capabilities have developed significantly over the past 5 years. This has enabled NHSBSA to provide important data insights to wider system partners, which has supported the provision of healthcare services and helped to improve decision-making within the NHS at a local and national level.

Given the scale of data that NHSBSA collects, the review notes that there is potential for this data to be used more widely to improve health outcomes in a number of areas. The review finds that further collaborative work would help to determine how the types of data produced by NHSBSA could be used and shared effectively.

NHSBSA places a significant emphasis on its counter fraud activities. Its ability to work collaboratively with its partners within the counter fraud system to minimise fraud, loss and waste has already contributed to significant financial savings in the wider health system. This could be further improved with greater collaboration and reporting through the department’s Counter Fraud Board to:

• ensure clarity over the responsibilities of each partner when new services are taken on
• better communicate new significant fraud risks

The review finds that there is merit in expanding NHSBSA’s provider assurance services. These services ensure that primary care providers understand and meet their contractual obligations, and the expected standards of treatment.

Additionally, NHSBSA provides prescription services in England and processes all those dispensed in primary care settings.

The Real-Time Exemption Checking service (RTEC) enables pharmacists’ systems to check digitally in real time whether patients are entitled to free prescriptions, and the Electronic Prescription Service (EPS) sends electronic prescriptions from GP practices to pharmacies and is a necessary component for pharmacies accessing RTEC.

Both EPS and RTEC benefit patients and pharmacies as fraud and error prevention mechanisms that, if maximised, would generate further substantial savings. In some cases, there would be additional expenditure involved, which would require the department and NHSE working together to optimise its use in different settings.

Capabilities

Given the range of functions that NHSBSA performs for the department and NHS, it has broad capabilities. In line with the terms of reference for this review, particular focus was given to digitisation and workforce capabilities.

The NHSBSA’s digital arm is particularly strong. Its digital capabilities are a key aspect of its strategy to deliver efficiencies for the NHS system, value for money for taxpayers, and service improvements, leading to better health outcomes for the public. NHSBSA has invested in its digital function, working in partnership with IT software providers to develop new technology solutions.

The review agrees that NHSBSA should continue its aim to meet policy intent and user need by delivering services that are accessible and inclusive, and that deliver efficiencies for the wider system. The review recommends that NHSBSA should continue the prioritisation of its work on the digitisation of its pension service to improve user experience and generate efficiencies.

The culture of NHSBSA and its workforce is integral to the successful running of its operation. Staff workshops and interviews undertaken during the review conveyed that the culture at NHSBSA is overwhelmingly positive, with the leadership team playing a key role in developing this by remaining transparent and open. It is further evidenced by its 2-star accreditation (demonstrating ‘outstanding’ commitment to workplace engagement) and its ranking as the best not-for-profit organisation to work for in the UK at the end of 2022.

The review notes that NHSBSA invests sufficiently in its people by giving development opportunities that provide challenge and growth, and adopting the right strategy to retain talent, given restrictions in other reward areas such as pay. The review finds that, due to the significant risk to NHSBSA’s future success as an organisation, it should continue to monitor the shifting professional landscape and its ability to retain or attract high-quality staff in areas such as digital and data analytics.

Summary of recommendations

Accountability

The sponsor team should ensure that the annual ministerial accountability meetings are reinstated from 2023.

The NHSBSA CEO and NHSE CEO, or a nominated member of NHSE’s executive team, should work to establish how the relationship could be improved, as well as identify key strategic priorities to ensure alignment and ongoing focus, with a proposal to be brought forward within 6 months.

The department should establish a quarterly ‘customer board’ with NHSBSA within 6 months to help with prioritisation and ensure that all customers are kept up to date with developments. It would include representation from NHSE and the department.

Governance

NHSBSA should continue to take action, as planned, on diversity and inclusion through targeted initiatives and mentoring programmes to tackle the lack of ethnic diversity in leadership and board posts.

This should be reviewed in 2 years to determine how much progress has been made.

Efficiency: benchmarking

NHSBSA should seek to improve its cost, performance and customer experience within a year by:

• benchmarking back office process as part of its KPIs
• considering what other benchmarks it can develop under its taxpayer value programme
• putting in place robust and effective plans to ensure cost, performance and an improved customer service experience in line with best practice

Efficiency: business and system wide

The review recognises the investment NHSBSA has made in professional workforce-planning and workflow management, and the benefits this investment is realising within the operational areas. To identify further efficiencies and build upon NHSBSA’s continuous improvement culture. NHSBSA should:

• establish a programme within 6 months, which identifies the unit cost for key prioritised services to drive continuous improvement through strategic target setting to achieve greater efficiency
• consider expanding its resource management and allocation tools in more areas within 6 months, including its enabling and corporate services

In addition to the aforementioned measures taken by NHSBSA, to secure a further 5% efficiency saving within NHSBSA (in addition to the 5% already committed), the department should consider whether a change in its stance on a number of policy issues could help to achieve these additional savings.

A national efficiency programme should be established between NHSBSA, NHSE and the department within 6 months to identify initiatives to generate further system-wide efficiencies, with an agreed timeframe for delivery.

Efficiency: outsourcing

The department should establish a programme to review, at appropriate regular intervals, whether services should continue to be delivered by NHSBSA or private contractors

Efficacy: shared services

There is potential for NHSBSA to provide a ‘contact centre hub’ when rapid response is required. A scoping exercise should be undertaken within 6 months to consider the feasibility of NHSBSA becoming a contact centre hub, with the focus on contact centre performance, to determine NHSBSA’s suitability in providing this shared service more widely.

As part of its consideration of the scope for greater use of shared services across its ALBs, the department should consider the contribution that NHSBSA’s shared service offering could make towards this objective within the next 12 months.

There is merit in NHSBSA holding all primary care service contracts, which should be explored jointly by the department and NHSE through a cost and benefit analysis of delivery options.

Efficacy: data

NHSBSA should continue to explore opportunities to leverage and maximise the use of its data to improve patient and population health outcomes.

NHSBSA should work with the department, NHSE, the UK Health Security Agency (UKHSA) and the Government Legal Department (GLD) to:

• map out the type of data sets that it is able to produce to assist work of key sector partners
• consider the proposed processing of that data in line with legal powers, data protection legislation and the common law duty of confidentiality

Efficacy: counter fraud

All new significant fraud risks should be communicated and reported against through the department’s Counter Fraud Board agenda, so that all parties are updated and aware of where these risks fall.

Each partner’s counter fraud responsibilities should be assessed annually by the department to facilitate further collaboration to support the NHS system.

The department should continue work to optimise the use of EPS and RTEC, as both have the potential to further reduce fraud and error, and generate efficiencies.

Capabilities: digitisation

Over the next 6 months, NHSBSA should make progress with its work on the digitisation of the pension service to improve user experience and generate efficiencies.

Overview of NHSBSA

NHSBSA is a special health authority and an ALB of the department. Special health authorities are ALBs created by the Secretary of State for Health and Social Care through secondary legislation. It is subject to direction by the Secretary of State in relation to the functions to be carried out, the exercise of those functions and allocation of funding.

It was established under the NHS Business Services Authority (Awdurdod Gwasanaethau Busnes y GIG) (Establishment and Constitution) Order 2005 and operates pursuant to directions. It became operational in 2006, following the merger of 5 separate NHS organisations:

• Prescription Pricing Authority
• NHS Pensions Agency
• Dental Practice Board
• NHS Logistics Authority
• NHS Counter Fraud and Security Management Service

NHSBSA administers £87 billion of NHS spend annually (£27 billion directly and £60 billion indirectly through the ESR) by providing essential, high-volume business services at scale to support NHS organisations, NHS contractors, patients and the public. Its services are organised into 3 main operational areas.

Primary care services

These services include:

• processing all the NHS prescriptions in England that are dispensed in primary care. In addition, NHSBSA makes remuneration payments to the value of £11.2 billion per year to over 11,500 pharmacies, and over 25,000 NHS contracted dentists who deliver NHS dental services in England and Wales^{[footnote 1]}
• undertaking provider assurance - a standardised and national contract and performance management service - on behalf of NHSE. NHSBSA facilitates the effective management of contracts and activity delivered under those contracts, including approximately £211 million per year savings
• the Vaccine Damage Payment Scheme, covering the UK and Isle of Man, which supports those severely disabled due to vaccination against certain diseases, through a single, tax-free payment
• providing scanning services, which deliver savings to the NHS and reduces the need for physical storage through cloud solutions
• the administrator and editor of the NHS dictionary of medicines and devices (dm+d) - the NHS medicine coding standard
• providing overseas healthcare services by administering registrations and claims for visitors, movers and those requiring planned treatment abroad, as well as managing the Global Health Insurance Card (GHIC) scheme
• the management of the English Infected Blood Support Scheme, which provides ex-gratia support to people and families affected by infected blood products
• the administration of exemption services (for example, prescription exemptions) to patients that helps them access health costs to which they are entitled
• managing the Healthy Start Scheme, which provides access to healthy foods for some of the most vulnerable families
• performing 91 million real-time eligibility checks for services annually, including prescription prepayment certificates and the low-income scheme
• managing over 2.6 million contacts to its contact centre annually

Workforce services

These services include:

• the administration of the NHS Pension Scheme in England and Wales for members, employers and pensioners. This includes managing over 3 million member records and payrolls for over 1 million pensioners
• managing the online recruitment service, NHS Jobs, for the NHS in England and Wales
• the management of the ESR, which provides workforce management solutions for NHS organisations in England and Wales
• the management of payments to NHS students
• delivery of human resources (HR) shared services, offering customers a range of critical HR services, including recruitment services, HR advisory, employee services and learning management services

NHSBSA employs approximately 3,200 staff, most of whom are based in Newcastle. The numbers of staff employed across its offices as of 1 September 2022 are:

• Newcastle-upon-Tyne: 2,198
• Wakefield: 77
• Fleetwood: 613
• Middlebrook: 340
• Eastbourne: 38

Public body assessment

In accordance with Cabinet Office guidance, this review shall examine the functions of NHSBSA and assess whether there is a case for the body to continue to exist in its current form. To determine this, the body must satisfy at least one of Cabinet Office’s ‘3 tests’:

• it performs a technical function
• its functions require delivery with political impartiality
• it needs to act independently to establish facts

Where the conclusion is that the body and its functions are still required, the delivery model of the function should be analysed to decide if it is the most appropriate. The review, therefore, includes an assessment of NHSBSA’s key functions to determine whether the existing body should remain at arm’s length from government.

Test 1: it performs a technical function

The review examined stakeholders’ views to consider whether the functions of NHSBSA are needed. The majority of respondents agreed that the technical functions performed by NHSBSA are necessary. Frequent reasons cited were that NHSBSA provides essential services, like payments to dentists and pharmacists through its national platforms, and it manages the largest centrally administered pensions scheme in Europe.

Many respondents also saw value in the data insights provided by NHSBSA, which supported the wider work of key partners. Respondents did not raise any significant problems with the services provided by NHSBSA, and recommendations on how NHSBSA improves its services centred on utilising its data analytics to better support the health and care system. NHSBSA performs technical functions that require a broad range of expertise and technical knowledge to ensure the delivery of frontline NHS services.

Test 2: its functions require delivery with political impartiality

The department is responsible for developing health and social care policies in England alongside its goals and objectives. As a special health authority, NHSBSA is expected to deliver these policies nationally. How policy is implemented and delivered is expected to be achieved impartially, based on the collection and analysis of relevant data. The review, therefore, notes the importance of having an independent body to administer such services nationally.

The review further recognises the role of NHSBSA in providing impartial assurance that NHS providers are delivering against their contractual requirements. For example, the NHSBSA post-payment verification process ensures that NHS providers are being paid correctly for the services they deliver. Where there is an error, NHSBSA can provide support and take action where appropriate. The review, therefore, finds that this test has been met. It is essential that NHSBSA is politically impartial in carrying out its functions.

Test 3: it needs to act independently to establish facts

Special health authorities are subject to direction by the Secretary of State in relation to the functions to be carried out, the exercise of those functions and the allocation of funding. The Secretary of State has ministerial responsibility for NHS delivery and performance. The review finds no evidence to suggest that NHSBSA’s functions need to be delivered independently from ministers to establish facts. Ministerial oversight is vital to support the integrity of the NHS system and provide direction The review necessarily concludes that this test has not been satisfied.

Delivery model

Abolish

NHSBSA performs a diverse range of functions that are critical to the delivery of key NHS provisions. NHSBSA continues to be relied on by the department to deliver new services such as overseas healthcare services. Funding for these services has been agreed with the department, which confirms that the functions that NHSBSA renders are necessary. If NHSBSA were abolished, the system would still need to deliver these functions. The review recommends that NHSBSA is not abolished.

Move out of central government

NHSBSA and the department have a shared objective to help people live more independent and healthier lives for longer. NHSBSA’s functions support central government, through its sponsor department, to deliver on this objective through national services like the Healthy Start Scheme. Furthermore, through collaborative working with integrated care systems, NHS trusts and local authorities at a regional level, NHSBSA can provide functions which support local communities while delivering on central government’s strategic objectives.

If NHSBSA’s functions were moved away from central government, these functions would need to be delivered by local government or the private sector (which is considered below). The review notes that there would be risks associated with this delivery model. Namely, it could result in discrepancies in how national healthcare provisions are delivered regionally. This could be more disruptive to the wider workings of the NHS. The review recommends that NHSBSA’s functions are not moved out of central government.

Commercial models

There can be benefits to functions being outsourced to the private sector. These include efficiency savings, lower costs and resources, and improved performance. Most of the services which NHSBSA provides could be outsourced to the private sector. For instance, services like the Healthy Start Scheme were previously provided by the private sector, while payment services to GPs and optometrists are currently being delivered by the private sector.

The experience of the past few years has shown there are benefits of NHSBSA being an in-house provider of services. These include:

• being able to co-design policy and delivery mechanisms without having to go through a competitive procurement process
• being able to avoid lengthy public procurement processes if there is a time imperative in setting up a new service. This may have been lessened post EU exit, as public authorities are no longer bound by EU procurement rules
• greater ease of data sharing between public authorities, which is important as NHSBSA data insights are increasingly seen as important, as well as its transaction processing capabilities and in depth understanding and knowledge of the health and care system

There may, theoretically, be potential benefits from transferring the whole of NHSBSA’s services to the private sector. However, given NHSBSA has a strong efficiency record and the fact it generally performs as well as its peers in benchmarking exercises, it would not currently be justified for the entirety of NHSBSA’s services to be outsourced. However, the merits of outsourcing some of NHSBSA’s services has been considered in the ‘Efficiency’ section (below).

Bringing in-house

The department could not perform the functions performed by NHSBSA. NHSBSA is an expert business delivery organisation. The department does not have the capabilities to deliver these functions as it is predominantly a policy department. Therefore, these functions are discharged by NHSBSA on behalf of the department. The review recommends that the functions of NHSBSA should not be brought in-house within the department.

Merge

There are some benefits to the merging of different organisations. This includes potential savings through the removal of some governance and central costs, such as senior management, property, finance, HR and commercial services. As part of the review’s assessment of whether NHSBSA should merge, it considered the merits of NHSBSA merging with an organisation that it serves, such as NHSE. The review also considered whether there were areas of significant overlap of services or synergies between NHSBSA and other ALBs, such as the NHS Counter Fraud Authority (NHSCFA) and NHS Resolution.

1. NHSE

NHSBSA has synergy and a close working relationship with NHSE. However, the functions of both bodies are separate and distinct to ensure the effective delivery of NHS services to the public. NHSBSA performs technical business functions that support the provision of healthcare services to the public while also driving wider health system benefits, which requires specific capabilities and focus.

There is clear merit in NHSBSA working as closely as possible with NHSE. However, at the time of reviewing, NHSE was in the process of merging with NHS Digital and Health Education England. Given this, consideration of a further merger would not be advisable at this time due to the attention and resource that an operation like this would require.

2. NHSCFA

NHSCFA was part of NHSBSA between 2006 and 2017. NHSBSA continues to provide some back-office services to the NHSCFA, such as payroll and HR services. NHSBSA and NHSCFA were separated in 2017 as both organisations play distinct roles within the overall counter fraud landscape.

NHSCFA is responsible for monitoring and assessing counter fraud performance across the NHS system and investigating serious, organised and complex NHS frauds. It collects data and intelligence related to fraud and develops strategic solutions to minimise fraud risks. It is important for NHSCFA to be impartial in its work across the health system. This includes the need to scrutinise NHSBSA in the same way as it would other NHS organisations.

Prior to its demerger from NHSBSA, this was achieved through the separation of the counter fraud function from the rest of NHSBSA. With robust separation arrangements, however, there is less scope for synergistic benefits with NHSBSA. While there may be some benefits through wider use of NHSBSA’s digital and data capabilities, some of the latter benefits would be constrained by information separation requirements. Furthermore, there have been no significant problems highlighted through the separation of NHSCFA from NHSBSA.

Additionally, there would be legal consequences to a merger, including amendments required to legislation not within the remit of the department, such as powers granted to NHSCFA under Home Office legislation. Amendments could only be made when there was Parliamentary time and a suitable legislative vehicle available, if primary legislation was required. This would mean that NHSBSA would be unable to investigate fully certain types of cases in the interim.

3. NHS Resolution

The degree of overlap between NHSBSA and NHS Resolution is limited. The main similarity between NHSBSA and NHS Resolution is that both perform claims management functions. However, the nature of those functions is very different. NHS Resolution’s main function is to administer NHS indemnity schemes for general practice and secondary care providers in England. It handles tens of thousands of claims every year, involving the assessment of legal liability and the quantification of damages for harmed patients. In contrast, NHSBSA provides payment support in relation to schemes for defined groups of individuals such as the Vaccine Damage Payment Scheme and the England Infected Blood Support Scheme, the latter being an ex-gratia scheme.

NHS Resolution acts in a range of ways to reduce the rising cost of clinical negligence cases and help improve patient safety and claimant experience. For example, it uses alternative dispute resolution, including mediation, to resolve claims without the need for expensive litigation and shares the learning from claims to drive safety improvement. These activities generate efficiencies for the system by ensuring that claims are dealt with fairly and at a proportionate cost.

As is the case with NHSCFA, there would be some potential for cost savings through not having separate boards and organisations, and potentially in some other central costs such as HR and finance where NHSBSA does not provide any shared services to NHS Resolution. However, there are areas of potential conflict of interest, which would need to be resolved, as currently one of NHS Resolution’s roles is to deal with appeals in relation to some primary care contracts to which NHSBSA is involved.

The review is also mindful of the significant input that would be required from senior management when securing successful mergers of organisations, as well as the inevitable uncertainty for staff. This report has highlighted a number of areas of potentially significant efficiency and effectiveness gains within NHSBSA and the wider system. In addition, both NHSCFA and NHS Resolution have as a primary purpose making savings elsewhere in the NHS system. The review considers, therefore, that management focus of all 3 organisations on making savings elsewhere in the system is likely to be of potentially greater benefit than a merger with another organisation.

Less formal structure

It is not possible to consider a less formal structure to deliver the functions of NHSBSA. NHSBSA operates under a legislative framework with powers afforded to it by directions.

A special health authority is legally considered a non-departmental public body (NDPB). It has a role in the government’s processes but is not a government department. The distinction between special health authorities and NDPBs is that special health authorities specifically support the department in delivering healthcare services.

In addition, altering the structure of NHSBSA would require amendment through secondary legislation. A formal structure is necessary to deliver its complex, often sensitive, and wide-ranging functions. Therefore, the review recommends against the adoption of a less formal structure.

Conclusion

The review finds that NHSBSA’s current status as a special health authority is the most appropriate delivery model for the functions of NHSBSA. None of the delivery options assessed would generate more benefits than NHSBSA’s existing structure. A change in the delivery model could add further complexities and carries a risk to the numerous services delivered to the system and the public. NHSBSA’s existing structure enables it to effectively support the wider health and social care system, which benefits the department.

Accountability

This section sets out the accountability arrangements between NHSBSA and the department, focusing on risk management and reporting. It outlines the legal framework underpinning NHSBSA’s operational functions and examines its relationship with the sponsor and policy teams. It further analyses the mechanisms NHSBSA adopts to prioritise departmental requests.

Legal framework and departmental oversight

NHSBSA’s business activities are underpinned by a complex legal framework of 10 statutory instruments. It exercises its functions pursuant to 32 directions from the Secretary of State for Health and Social Care in accordance with its status as a special health authority.

Special health authorities are a type of ALB unique to the department. They are created by the Secretary of State under secondary legislation to perform specific functions. The statutory powers afforded to the Secretary of State to perform such functions are set out in the National Health Service Act 2006 and the Health and Social Care Act 2012. This legal framework enables the Secretary of State to transfer and delegate functions to NHSBSA by issuing directions.

The Secretary of State has ministerial responsibility for, and oversight of, NHS delivery and performance, and is accountable to Parliament on all matters concerning NHSBSA. The Secretary of State is supported in their function by the department. Within the department, the Second Permanent Secretary has appointed the department’s commercial director as the senior departmental sponsor for the NHSBSA.

The senior departmental sponsor is the main source of advice to the Secretary of State. The senior departmental sponsor meets with the chair and the CEO of NHSBSA as part of the department’s accountability arrangement. The senior departmental sponsor’s role ensures sufficient oversight at a department level to support the Secretary of State in holding NHSBSA to account. However, the review finds that ministerial engagement has been infrequent due to the COVID-19 pandemic. The annual accountability meeting with ministers was suspended, although it is expected to be reinstated in 2023. The review would welcome this as it provides an appropriate channel to ensure increased ministerial oversight.

Relationship with the sponsor team

The sponsor team is the primary contact between the department and NHSBSA. It supports the senior sponsor by liaising regularly with NHSBSA to ensure that it is an accountable and high-performing organisation. This function is achieved by ensuring that NHSBSA has a clearly defined remit as per the department’s framework agreement with NHSBSA.

The review finds that the department and NHSBSA have a strong and effective working relationship at sponsorship level. There is a good sponsorship governance arrangement, with transparent and open discussions, to support planning and ensure that NHSBSA achieves its targets through regular reviews of its performance. The current sponsor team has very good, detailed knowledge of NHSBSA and so can add real value. It is the review’s view that NHSBSA has a particularly strong sponsor team.

Assurance

The sponsor team liaises with counterparts in NHSBSA to support effective corporate relationships and coordinate assurance and accountability functions. The main accountability monitoring route of NHSBSA’s performance is regular quarterly accountability review (QAR) meetings with the senior sponsor. During the QAR, performance against its key services is discussed as well as new projects, risk and mitigation strategies. The sponsor team attends other accountability forums to keep abreast of developments at NHSBSA. These include:

• the NHSBSA Board meetings
• the Audit and Risk Committee
• monthly finance and procurement meetings
• fortnightly financial tracker meetings
• regular meetings with the chair, CEO and senior directors

The review finds that the sponsor team has sufficient assurance arrangements, with regular reporting and assurance meetings to maintain good oversight of NHSBSA.

Risk

Risk is regularly reported to the NHSBSA Board through the Audit and Risk Committee. In addition, risk management is discussed at the NHSBSA Board meetings, which occur 8 times a year. This allows board members to seek more detailed assurance from senior leaders within NHSBSA.

Example 1: risk escalation processes

There was an ongoing resourcing issue in NHSBSA’s contact centre, with recruitment and retention challenges resulting in high levels of staff attrition. The effect was long wait times for customers, which impacted the delivery of critical KPIs. Staff wellbeing was also negatively affected as there was less downtime between calls.

NHSBSA identified this issue and reported it as a risk through its risk management framework. The NHSBSA Board was made aware through the Audit and Risk Committee, which determined that this issue should be placed on the NHSBSA corporate risk register.

At the board meeting, risk themes were discussed along with the outcome of a broader risk management deep dive exercise. In addition to a member of the sponsor team attending the board meeting, regular reporting meant that the department was kept informed of the risk. This resulted in a better understanding of the overall risk landscape.

NHSBSA mitigated the risk through external suppliers to provide contact centre support and analysis of contact drivers. Regular engagement with NHSBSA’s leadership team further ensured that risk was managed appropriately through the right channels.

As a result, the issue improved with contact centre resourcing increased by 93% in the 9 months following the period in which the risk was identified.

The sponsor team can escalate the risk to the department via the Policy Assurance and ALB Oversight Team or the Central Risk Team. Risk can also be reported to policy and functional leads. There is evidence that the department, through its sponsor team, has sufficient oversight of risk management in NHSBSA and assurance of potential risks. These are dealt with appropriately and in accordance with the department’s risk management strategy. Quarterly risk updates are provided, by the sponsor team, to the department’s Performance and Risk Committee. In addition, NHSBSA has been invited to attend the department’s Audit and Risk Committee on a rotational basis to discuss its key risks and business more generally.

Relationship with policy teams

NHSBSA has a collaborative and positive working relationship with policy teams in the department. One policy customer said:

We work with some excellent people at NHSBSA across prescription, information, and citizen services. Hugely knowledgeable about their subject areas, great expertise, which it is willing to share […] We could not have delivered on ministerial asks without them.

The Medicines Directorate and Primary and Community Healthcare Directorate work closely with NHSBSA on a daily basis, in prescription services, information services and citizen services. The complexity of the NHSBSA systems and its interface with GPs and pharmacies makes this close relationship crucial to successful delivery of services, “as is the creativity and strong engagement from NHSBSA officials”.

Despite NHSBSA’s good working relationship with policy teams, it has reported occasions where there have been inconsistencies. NHSBSA stated that on occasions when it has not been engaged in the policy development process from the outset, this has resulted in difficulties in operationalising the policy and ensuring the most efficient service models can be implemented. This has impacted service delivery which could have been mitigated through earlier engagement in the policy cycle. Where difficulties have arisen, there is evidence that the working relationship has changed through positive engagement and openness. This has included formal governance models and informal engagement channels.

Example 2: collaborative working with the department’s Workforce Policy Team and NHSBSA to reprocure the NHS ESR

ESR is Europe’s largest centralised HR and payroll system, providing payroll and HR services to NHS organisations in England and Wales, making monthly payments to over 1.8 million NHS employees.

The department commissioned NHSBSA to manage contract performance and work with the supplier to achieve service delivery success. The original contract started in 2001, and re-procurement led to a second-generation contract in 2014. NHSBSA has a current contractual agreement with IBM to provide this workforce management solution until August 2025.

NHSBSA used the re-procurement project as an opportunity to work with users to inform, support and develop system capability for a slicker, faster platform. NHSBSA underwent a 12-month discovery exercise to understand the current and evolving user needs. Throughout the process, NHSBSA has worked collaboratively with policy colleagues.

At a strategic level, there were clear lines of accountability and joined-up thinking from both sides across all areas of workforce services. This resulted in a successful discovery and market engagement phase, enabling the commencement of formal procurement through collaborative working.

Relationship with NHSE

NHSBSA is a key delivery partner of NHSE. There are strong relationships at many levels across the 2 organisations. However, both NHSBSA and NHSE stated that their relationship is often transactional when it should be more strategic and collaborative.

NHSBSA provides services and data science to NHSE that supports the wider system in delivering critical health, care and transactional provisions for the public. For example, in 2020, NHSBSA played a crucial role in supporting the wider NHS system during the COVID-19 pandemic.

NHSBSA has considerable potential to contribute its data insights to improve health outcomes (for instance, on its Healthy Start Scheme and its Opioid Prescribing Dashboard), for NHS workforce planning and to produce further system efficiencies through its provider assurance function.

Many of NHSBSA’s services, such as ESR, are provided to NHSE, but are commissioned and funded by the department. In 2020, the prospect of moving to a direct funding arrangement with NHSE was explored but did not proceed at the time. The review considers that in the long term there would be considerable merit in such an arrangement to enable NHSBSA to be more closely integrated to the NHS ecosystem.

The review recognises, however, that in the short-to-medium term NHSE is dealing with severe pressures, including a merger of several public bodies. In practice, this would make extensive engagement challenging. However, there remains a need for a more strategic relationship. Therefore, in the interim, a meeting should take place between NHSBSA’s CEO and NHSE’s CEO or a nominated member of NHSE’s executive team to establish how the relationship could be improved, as well as identify key strategic priorities to ensure alignment and ongoing focus. The review notes that NHSBSA is already engaging with the NHSE Chief Commercial Officer and its team which should continue to be developed.

Prioritisation

NHSBSA has an internal process for prioritisation of the delivery of projects from the department. These are communicated to the department at the start of each year through agreement of its Strategy and Business Plan. NHSBSA, however, acknowledges that there could be an improvement in how it reprioritises projects based on the department’s key priorities.

The review notes that while the annual Strategy and Business Plan enables the department to be aware of NHSBSA’s priorities for the year, this process is rigid. NHSBSA feels it is hard for it to have a clear line of sight when internal departmental priorities change. This makes the reprioritising process more difficult without ongoing strategic communication from the department. This accordingly impacts NHSBSA’s ability to keep policy teams and other key department leads well informed on changes.

The review finds that a quarterly customer board with NHSBSA would be beneficial. Due to the range of services that NHSBSA provides for both the department and NHSE, a customer board would help to ensure that all parties are kept abreast of developments and ensure that NHSBSA is able to prioritise between customers if required. In addition, it would ensure that finance and policy leads are engaged from the onset and would enable them to be able to work through any funding issues or barriers to the operational delivery of policies, as well as improving customer experience and service delivery. This accordingly would improve the working relationships between the department, NHSE and NHSBSA respectively.

Commissioning and funding models

The review also raised important questions with respect to how NHSBSA could acquire its funding. There is recognition across government of the value of medium-term financial planning. NHSBSA feels that the setting of 3-year revenue and capital budgets in advance would ensure effective resource utilisation. This would allow for prioritisation changes, the transformation projects and the tackling of technical debt. This would further support more effective workforce planning, technical infrastructure and efficiency planning.

While medium-term funding guarantees would benefit NHSBSA, all public bodies government funding is subject to the outcome of regular Spending Reviews. Spending Reviews are not always done on a 3-year basis, but they provide an opportunity for the government to re-examine public spending to ensure it delivers on national priorities. As priorities can change to respond to emerging issues (such as COVID-19), from a departmental perspective it is often difficult to firmly commit to a funding budget beyond a year.

Recommendations

1. The sponsor team should ensure that the annual ministerial accountability meetings are reinstated from 2023.
2. The NHSBSA CEO and NHSE CEO, or a nominated member of NHSE’s executive team, should work to establish how the relationship could be improved, as well as identify key strategic priorities to ensure alignment and ongoing focus, with a proposal to be brought forward within 6 months.
3. The department should establish a quarterly ‘customer board’ with NHSBSA within 6 months, to help with prioritisation and ensure that all customers are kept up to date with developments. It would include representation from NHSE and the department.

Governance

This section examines the governance arrangement at NHSBSA. It provides a brief overview of NHSBSA’s governance structure, including the roles and remit of the NHSBSA Board and leadership team. It also provides a high-level assessment of the effectiveness of the NHSBSA Board.

Board and structure

The role of the board is to ensure that NHSBSA delivers its strategic objectives pursuant to statutory and common law duties. The responsibilities of the board are set out in the Board’s Scheme of Delegations and Matters Reserved to the Board. Examples of these include:

• standing orders
• certain controls and appointments
• strategic planning
• performance monitoring
• audit

The board’s structure is defined under the NHS Business Service Authority (Awdurdod Gwasanaethau Busnes y GIG) (Establishment and Constitution) Order 2005 (SI 2005/2414), as amended by SI 2006/632. There are 12 board members, comprising 6 executive and 6 non-executive directors.

Sue Douthwaite is the non-executive chair of the board. She took over as chair of NHSBSA on 1 April 2022.

The chair and the non-executive directors of NHSBSA are appointed by the Secretary of State under paragraph 2 of Schedule A1 of the National Health Service Act 2006. The CEO reports to the board in their capacity as Accounting Officer of NHSBSA, who is responsible for safeguarding the public funds for which he or she has charge.

The below diagram provides a simplified version of the board structure

Figure 1: NHSBSA Board structure

Text alternative to figure 1

A diagram showing the structure of the NHSBSA Board.

Non-officer members are as follows:

• Chair (Remuneration and Nominations Committee member)
• Non-Executive (Remuneration and Nominations Committee Chair, Senior Independent Director)
• Non-Executive (Audit and Risk Committee Chair)
• 2 Non-Executives (Audit and Risk Committee members)
• Non-Executive (Remuneration and Nominations Committee member)

Officer members of the board are as follows:

• Chief Executive
• Executive Director of Strategy, Performance, Business Development and Growth (Deputy CEO)
• Executive Director of Finance, Commercial and Estates
• Executive Director of People and Corporate Services
• Chief Operating Officer
• Chief Digital, Data and Technology Officer

Governance arrangements

The board is the corporate governing body of NHSBSA. However, it has established several board committees that advise across its areas of responsibility.

The Audit and Risk Management Committee provides the board with an independent view of the effectiveness of NHSBSA’s governance and assurance arrangements. This includes assessments of the effectiveness of NHSBSA’s governance framework, risk management and controls.

The Remunerations and Nominations Committee determines the remuneration package and other benefits of the executive team in accordance with the NHS Executive and Senior Managers Pay Framework. Although the board committees have defined functions, the board retains overall control and responsibility across these areas.

The chair of each board committee is required to report to the board. The review finds that the governance arrangements are clear, and reporting lines are defined to ensure that the board has effective oversight over NHSBSA.

Shadow board

The shadow board mirrors the main NHSBSA Board. The shadow board comprises 8 members of NHSBSA staff from across the organisation at different levels. Shadow board meetings are chaired by the chair of the board.

The shadow board was established to help improve diversity at board level. It helps to ensure that a diverse range of views and perspectives are provided on the board’s agenda items and decisions, given the lack of diversity in ethnicity and disability of the current board. It helps to deliver this diversity by ringfencing 4 shadow board seats for individuals from different lived experience networks, including women’s network, LGBTQ, BAME, disability and neurodiversity. The remit of the shadow board is to review and provide constructive challenge and feedback on board agenda items.

Shadow board meetings take place the day before the board meeting and are run the same way as board meetings. The CEO uses these meetings to explain what is on the agenda at the board meeting and the material that will be presented.

Shadow board members are provided with an opportunity to challenge and provide constructive criticism on agenda items. Two shadow board members attend each board meeting to highlight the views of its wider members.

The fact that senior leaders dedicate a substantial amount of time to the running and organisation of the shadow board illustrates the importance that NHSBSA places on diversity, inclusion and the development of staff.

Leadership team

Michael Brodie is the CEO and the Accounting Officer of NHSBSA. He joined NHSBSA in September 2019, having previously served as the Finance and Commercial Director at Public Health England (PHE).

The CEO is responsible for the operational management of NHSBSA. The review notes the positive impact that Michael Brodie has had within NHSBSA. The strong values and the organisation’s collegiate culture have resulted in a high level of staff engagement which, according to Best Companies (who carried out the survey on behalf of NHSBSA), has been critical to NHSBSA’s high performance.

One respondent from the staff workshops stated, “there is compassionate leadership here which starts from the top”. Another respondent said, “Michael’s impact cannot be underestimated; he lives the values”, while a third respondent said, “Michael is for the people”. Stakeholders have also praised the CEO for his impact on driving forward the culture and vision of NHSBSA.

The CEO is supported in the management of NHSBSA by a strong leadership team. The diagram below sets out the leadership structure at NHSBSA.

Figure 2: NHSBSA leadership structure

Text alternative to figure 2

A diagram showing the leadership structure at NHSBSA.

The Chief Executive Officer is at the top.

Below sits:

• Executive Director of Strategy, Performance, Business Development and Growth (Deputy CEO)
  • Head of Professional and Clinical Services
• Chief Portfolio and Prioritisation Officer
• Chief Data, Digital and Technology Officer
• Executive Director of Finance, Commercial and Estates
• Director of Workforce Transformation
• Chief Operating Officer
  • Associate Director of Operations (Citizen Services)
  • Associate Director of Operations (Workforce Services)
• Director of Primary Care Services
• Executive Director of People and Corporate Services
  • Head of Communications and Marketing

The review recognises the mix of private and public sector experience within its leadership team. The balance in public and private sector experience coupled with homegrown talent, ensures a wide range of expertise and makes the leadership team sufficiently robust and able to respond to challenges.

Strong leadership was demonstrated throughout the COVID-19 pandemic in NHSBSA’s operational ability to stand up services at pace and deliver vital services to the public. NHSBSA established 3 new helplines to ensure the continual supply of personal protective equipment (PPE) and public health contact tracing. Many staff stated they felt “empowered” and “proud” knowing they were supporting the delivery of key NHS functions in a difficult time, which is a credit to the leadership team at NHSBSA. The review finds that the leadership team is very effective. It has encouraged and motivated staff to deliver in challenging circumstances.

In addition, the leadership team at NHSBSA is people focused. The leadership team creates opportunities for people to progress and source new talent that will continue to develop the capabilities of NHSBSA. NHSBSA is proactively promoting its digital technology capabilities in the North East by working with the National Innovation Centre for Data, to learn and share best practices and attract people in this area of expertise.

The union representatives at NHSBSA said they feel that the leadership team is “approachable and open”. The leadership team has taken time out to mentor people within the organisation, which has been helpful in that many have worked their way through the ranks.

NHSBSA has shown continual improvement from a diversity and inclusion perspective. The review notes that there has been a positive increase in gender diversity within the leadership team since Michael’s appointment. However, NHSBSA rightly recognises that there is still a lack of ethnic diversity in leadership positions and at board level. As part of NHSBSA’s Diversity and inclusion strategy 2022 to 2025, there is a particular focus on increasing representation in senior posts. While the review is impressed by the efforts that NHSBSA has made to try to improve diversity within its workforce, leadership team and its board, it recognises that diversity is not yet reflected in the outcome of greater ethnic and disability representation. The review agrees with NHSBSA that this is an area on which it should continue to focus, and that a formal review of the progress be carried out in 2 years.

Board effectiveness

Cabinet Office guidance states that Board Effectiveness Reviews (BERs) should be conducted by the chair of the board annually, with external facilitated BERs occurring every 3 years. BERs provide a robust assessment of the board’s effectiveness, including whether it has appropriate structure, processes, people and performance.

NHSBSA conducted its most recent internal BER in February 2022, while the last external BER was taken in 2019. The results of the BER show that the board continues to be highly effective, with an overall score of 8.8 out of 10. The review notes that an area of strength was the board’s decision-making. 100% of respondents agreed with the statement that “the board is able to make good quality decisions using a consensus approach without the need for any formal voting.” 92% of respondents agreed with the statement, “the board agendas usually have the right balance of strategy, performance management, decision making and information sharing”.

The BER also highlighted that an area of focus was ensuring that the board had adequate arrangements for succession planning. The review finds that NHSBSA is proactively focusing on this area as part of its long-term strategy. The review is satisfied that NHSBSA reviews its board effectiveness appropriately. It further notes the influence of the new chair in bringing new perspectives and a vision of how NHSBSA will achieve its long-term ambitions.

The review further notes the sponsor team’s assessment of the board as being effective. The sponsor team feels that the board strikes the right balance between challenging the CEO and directors in areas of service delivery and performance, and supporting the development and setting of NHSBSA’s strategic direction. Non-executive members of the board have been selected because of their experience in areas of business where there is challenge. This includes:

• digital development and IT delivery
• human resource management
• organisational design
• large-scale operational delivery
• financial management

The depth of expertise is beneficial to NHSBSA. The experience of non-executive members complements the skills of executive members of the board and there is close working both inside and outside of board meetings.

Recommendation

NHSBSA should continue to take action, as planned, on diversity and inclusion, through targeted initiatives and mentoring programmes to tackle the lack of ethnic diversity in leadership and board posts. This should be reviewed in 2 years to determine how much progress has been made.

Efficiency

This section considers the efficiency of NHSBSA by examining its benchmarking performance to assess its efficiency and performance against comparators, its efficiency improvement record and its financial management performance. It will also assess whether there is scope for further efficiencies and consider the contributions which NHSBSA has made to wider NHS system efficiencies and the scope to do so in the future. Finally, it considers NHSBSA and the department’s approach to outsourcing which can sometimes be used as an approach to improve efficiency and performance.

Benchmarking

Benchmarking is useful to provide a guide as to areas which should be investigated further when considering efficiency and effectiveness. There may be external factors which explain why an organisation performs particularly well or poorly through benchmark comparisons. Therefore, the results of the benchmarking should be viewed in that light.

NHSBSA recognises benchmarking as an important practice to inform an assessment on whether the services it provides are value for taxpayers’ money. It uses benchmarking when undertaking major service redesign and in ensuring that back-office services remain efficient. It has supplied various documentation to demonstrate its approach to, and track record of, delivering value for money in line with the Taxpayers Value Programme and the Chartered Institute of Public Finance and Accountancy (CIPFA) value for money indicators for finance, HR, communications and estates.

NHSBSA has provided benchmarking information on some of its existing services that illustrates its current performance on efficiency and effectiveness. This is summarised in Table 1. The review notes the relatively limited number of benchmarks and recommends that NHSBSA seeks to develop a wider range of benchmarks as part of its Taxpayer Value Programme.

Table 1: key benchmarks of NHSBSA’s services

NHSBSA service	Benchmarks
NHS Pension Scheme	NHSBSA £11.74; comparator £22.44
NHS Job Service	NHSBSA £3.8 million cost supports 7,350 organisations; comparator £3.025 million cost supports 213 organisations
Contact centre	Non-financial benchmarking, achieved gold award at recent CCA global assessment (December 21)[footnote 2]
Contact centre resource	NHSBSA £15.26; comparators: organisation A £17; organisation B £17.68
Back office	Set against CIPFA benchmarks HR or comms: lower quartile Estate costs: significantly cheaper per square meter Finance: at mean of competitors

NHS Pension Scheme

The NHS Pension Scheme is the largest public sector pension scheme. NHSBSA undertakes an annual benchmarking exercise using CEM benchmarking to assess the performance and cost efficiency of the administration of the NHS Pension Scheme.

In respect of performance, the CEM benchmarking study looked at the service provided to members with higher service, meaning more channels, faster turnaround times, more availability, better content and higher quality. NHSBSA has a total member service score of 51 out of 100, which compares to the peer median score of 63.

In respect of cost, NHSBSA is the cheapest of all public sector pension schemes benchmarked with a cost of £11.74 per member compared to an average comparator of £22.44. CEM, which carried out the benchmarking, also adjusted costs to allow for scale, showing that NHSBSA still compares favourably against a scale adjusted average cost per member of £14.73, with NHSBSA ranking as the fifth cheapest of 12. In comparison to the cheapest provider, NHSBSA’s business as usual (BAU) costs are significantly higher (by over a third). It should be noted that no adjustment for complexity is made in the benchmarking. CEM has agreed that this would be beneficial and will be included in future exercises. NHSBSA believes this will significantly improve its benchmark costs relative to the outcome of the scale adjusted exercise.

The NHS Pension Scheme costs more per member for delivering multi-year major projects than the average costs for other public sector pension schemes. There are several possible explanations for this, including the following:

• NHSBSA’s costs include an overhead
• peer costs may be averaged over a shorter time period
• it may be a product of the complexity of the NHS scheme
• the NHS Pension Scheme is applicable to self-employed NHS professionals such as GPs and dentists and high-income earners with different tax codes
• the NHS Pension Scheme is less cost effective in delivering multi-year major projects

Additionally, since the NHS Pension Scheme was insourced, a programme of change has continued developing service delivery improvements that were not delivered while the service was outsourced. However, its administration and governance costs are lower than the average of its peers - with project costs £0.82 per member below their 5-year average - showing improvements in efficiencies.

A very high-level comparison with the administration of the Teachers Pensions Scheme indicates a number of areas where service and/or cost improvements might be made. The review understands that the Teachers Pensions Scheme is more advanced in the implementation of its equivalent to the ‘My NHS Pension online’ offer that is currently being developed by NHSBSA, as well as the despatch of electronic rather than physical pension statements. NHSBSA feels that these steps to digitise further the NHS Pension Scheme will drive operational and customer experience improvements.

The review finds that there is additional scope for cost and service improvements in the administration of the NHS Pension Scheme. This accordingly should be an area of focus for NHSBSA to enable it to get closer to the best performer in pension administration.

NHS Jobs service

The NHS Jobs service has an annual cost of £3.8 million which supports 7,350 organisations. This compares to its nearest comparator’s annual cost of £3.025 million, which supports 213 organisations.

While not a saving to NHSBSA, system efficiency improvements will be driven through the transformation of the NHS Jobs service to allow a faster and more efficient process for NHS users of the service. According to NHSBSA’s estimates, this could result in savings in the region of £100 million over 5 years through the provision of a free jobs board and a reduction in NHS users’ spend on other third-party job sites over time and then ongoing annual savings of £23 million.

Contact centre

The NHSBSA contact centre is the single largest component of NHSBSA’s citizen services as well as providing the contact centre for pension administration services. Call Centre Management Association (CCMA) benchmarking has been used to assess NHSBSA’s contact centre performance.

NHSBSA has generally in the past performed on a par with or better than industry benchmarks on measures such as average speed to answer, abandonment rate of incoming calls, and average handling times, and has taken action to keep at the forefront of best practice. For example, during 2020 to 2021, enhanced interactive voice response automation initiatives by NHSBSA, using number capture technology, has led to average handling time savings of approximately 30 FTE.

However, more recently, there was a marked deterioration in the period November 2021 to March 2022. For example, average speed to answer increased from 61 seconds to 382 seconds and the abandonment rate for incoming calls increased from 3.0% to 16.9%. NHSBSA has attributed this to several different reasons, including:

• increased call volumes (650% over forecast, driven largely by onboarding of a new service which was under specified)
• increased numbers of new staff due to a more challenging labour market and taking on new services
• the complexities of the contacts handled

The review, however, notes that action is being taken to address call wait times which should improve end user experience.

The overall volume of pension calls increased more than 100% in the 5 years from 2017 to 2022. Average call handling time increased from 6 minutes in 2017 to 10 minutes in 2022. NHSBSA states that this increased average handling time is related to the increase in volume, as it results in a higher FTE requirement and training of new employees in a service area with high attrition. According to NHSBSA, there are factors, including increasingly complex pension arrangements being discussed with callers, which have contributed to the increase in average call handling time. NHSBSA’s plans to further digitise its pensions service should reduce call handling times.

It is important that customer service should be an area for continued focus for NHSBSA to ensure that improvement in performance is maintained. This should also be monitored closely by the department as part of its regular assessment of NHSBSA’s performance for reasons explained in the ‘Shared services’ section (below).

Contact centre resource

NHSBSA offers an overall pay and reward package that can attract staff to the organisation, although post-COVID-19 staff attrition challenges in the contact centre are in line with the UK average. This does present challenges for maintaining efficient services, particularly in a challenging economic climate with labour shortages.

The review notes NHSBSA’s efforts in developing a strong organisational culture as part of its overall approach to recruitment and retention across the business. This, in addition to its focus on staff wellbeing and diversity and inclusion, will be of increasing importance over the next few years to ensure that NHSBSA can attract and retain the right people to deliver effective services.

Back office

NHSBSA has benchmarked its back-office services against the latest available CIPFA benchmarks in 2018. Benchmarking shows that NHSBSA’s HR and communications functions are delivered at the lower quartile cost levels, thus operating efficiently. Estate costs are significantly cheaper per square metre than similar organisations, and finance costs are in line with the mean cost of comparators.

NHSBSA is acting to improve further the balance towards value added activities. The implementation of a new integrated finance system in 2022 to 2023 is intended to streamline transactional areas and improve the value of reporting and decision support. This will improve its ability to report meaningful management information in real time and ultimately improve value for money.

Benchmarking conclusion

NHSBSA generally performs well against a number of benchmarks across several business areas and enabling services. However, there are some areas where further improvements could be made. NHSBSA should seek to systemise its approach to benchmarking back-office services and proactively create a cohort of organisations to benchmark against, in the absence of CIPFA providing such services.

The review’s examination of several benchmarks highlights that there are identifiable areas for improvement, which NHSBSA is undertaking a programme of work to address. Further digitalisation across its business should increase efficiency and improve customer service levels. NHSBSA should also assess how it can improve its performance in its contact centre and other BAU areas to drive further efficiencies.

Recommendations

1. NHSBSA should seek to improve its cost, performance and customer experience within a year by:

• benchmarking back-office process as part of its key performance indicators (KPIs)
• considering what other benchmarks it can develop under its Taxpayer Value Programme

2. Robust and effective plans should be put in place to ensure cost, performance and an improved customer service experience in line with best practice.

Efficiencies: business and system wide

When examining NHSBSA’s record on efficiency improvement, it is important to distinguish between efficiencies that can be generated within NHSBSA and those that NHSBSA can contribute to as part of broader NHS system efficiency.

Business efficiencies

In respect of its own business efficiency, NHSBSA has constructed a counterfactual spend to illustrate the reduction in its funding that has been delivered since its inception in 2006. The calculation is summarised in tables 2 and 3. It should be noted that the construction of the counterfactual spend has required some judgement on the change in scope, price and volume of NHSBSA services over this period.

Table 2: comparison between 2006 to 2007 baseline funding and 2021 to 2022 baseline funding

Funding	2006 to 2007 prices £ million	2021 to 2022 £ million	Change in baseline funding £ million
2006 to 2007 original baseline funding	110.6	n/a	n/a
2006 to 2007 uplifted for new services	38.1	n/a	n/a
Baseline funding	148.7	125.5	23.2

Table 3: reduction in funding from 2006 to 2007 compared to 2021 to 2022 (adjusted for volume growth and price increase)

Funding	2006 to 2007 £ million	2021 to 2022 £ million	Reduction in funding £ million
Baseline funding (adjusted for price inflation)	242.1	125.5	116.6
Value of delivering additional volume growth	n/a	n/a	30.1
Total reduction in RDEL funding	n/a	n/a	146.1

Direct department revenue funding (adjusted for price and volume growth) is nearly £150 million lower today than when NHSBSA was created in 2006. The focus on efficiencies and re-skilling of resources has kept down staff costs while still driving, on the whole, high service performance. However, it should be noted that the almost £150 million lower RDEL funding in Table 3 does not all equate directly to an efficiency improvement. Demonstrating NHSBSA’s ability to look for alternative funding models, it worked collaboratively with the department to seek funding for NHS Pensions via employer contributions. This reduced the requirement on department funding of £35 million, meaning that the level of ‘true’ efficiencies delivered is nearer £115 million.

Table 4 below illustrates how the workforce has evolved, based on changes in services provided. It shows that there has been a year-on-year 7% reduction in workforce linked to the historic services, demonstrating a track record of transforming services and driving operational efficiencies. WTE have decreased from 1,183 in 2015 to 2016 compared with 765 in 2021 to 2022.

Table 4: WTE trends in operational staffing

Services	2015 to 2016	2016 to 2017	2017 to 2018	2018 to 2019	2019 to 2020	2020 to 2021	2021 to 2022	Average annual change
Historic services [footnote 3]	1,183	1,074	982	865	810	804	765	-7%
Historic services with significant insourcing [footnote 4]	465	469	560	561	741	789	882	11%
New services[footnote 5]	101	138	174	276	465	746	784	41%
Total WTE	1,749	1,681	1,716	1,702	2,016	2,339	2,431	n/a

Source: NHSBSA efficiency paper for the department (final)

The area of historic services where there has been significant insourcing is pensions. In recent years, NHSBSA has taken on a wide range of new services. This has driven growth in the workforce, and also reallocation within this area. When a service is historic, NHSBSA works to reduce staffing resource. Automation initiatives have led to a significant reduction in staff employed in exemption checking services.

Current position on 5% efficiency challenge

The review’s terms of reference require NHSBSA to deliver efficiency savings of at least 5% in RDEL funding from the department, which should be achieved within 1 to 3 years. This 5% target takes into account inflation and savings that have already been delivered under the last spending review. NHSBSA intends to fulfil this requirement as follows.

NHSBSA RDEL direct efficiency savings (year on year from 2022 to 2025) are as follows:

• estate rationalisation: £2.7 million. This breaks down into:
  • 2022 to 2023: £0.4 million
  • 2023 to 2024: £0.6 million
  • 2024 to 2025: £1.7 million
• digital projects: £2 million
• workforce pay: £2 million
• total efficiency: £6.7 million
• current net budget: £135.6 million
• efficiency as % of budget: 5%

Source: finance ALB efficiencies meeting, 28 July 2022

NHSBSA considers that it can deliver £6.7 million in RDEL business efficiency savings in line with the 5% efficiency target. It has supplied detailed explanation of the estate rationalisation strategy, and its digital project savings.

NHSBSA’s ideas on workforce savings are evolving. The intention is to deliver approximately £2 million in baseline savings to cover the increase in staffing costs as a result of the average 4.5% increase in staff pay under the Agenda for Change initiative. These savings will be delivered through a combination of factors, including managing risks in the financial position, careful recruitment control and understanding actions being taken to address the national difficulties in recruiting, seeking ways to manage inflation on spend and securing additional income.

The review examined NHSBSA’s efficiency performance over the past 6 and 15 years. NHSBSA achieved efficiency savings of 2.7% per year over the 15-year period since 2006. However, during the latter part of this period (2015 to 2021), NHSBSA has achieved lower efficiency savings of 1.15% per year.

The tailing off improvements in efficiency led the review to examine in more detail the NHSBSA approach to driving continual improvement and efficiency within its BAU processes. It should be noted that NHSBSA played a key role in the latter part of this period to support COVID-19 pandemic efforts. Therefore, this lower level of efficiencies should be viewed in that context as, understandably, it would have been an area of management focus.

NHSBSA has invested in professional workforce planning and workflow management, which it has used to manage individual performance. This has had benefits within the operational areas. For example, email clearance rates were planned for 7 emails per hour over 2022 to 2023 but rates have increased to 9.7 emails per hour. This is due to performance being managed using data supplied from the workflow management system.

However, the review finds that there is scope to generate further business efficiencies in a more extensive way by using workforce planning and management tools to monitor, set targets and drive efficiencies at a process level. This should be achieved through monthly reporting to the leadership team on the unit costs for key services to monitor any in-year variation to the cost of delivering services. NHSBSA should use this approach to drive continuous improvement through strategic target setting to achieve greater efficiency. This should also be reported against at the QAR meetings with the department. NHSBSA should also further consider expanding the adoption of workforce management tools, beyond current operational areas of the Contact Centre, customer support, student services and NHS pensions to drive performance to other operational areas and therefore drive further efficiencies.

In addition to the 5% savings already identified, there have been further savings identified as part of the review. Some of these efficiency savings would require either direction by the department, a change in current policy stance or additional focus from NHSBSA. Table 5 provides estimates of potential savings that could be generated.

Table 5: summary of estimated additional potential RDEL efficiency savings (ALB review team estimates)

Areas	Potential savings per year (£ million)	Requirements
EPS maximisation	4 to 6	Continued push to automation, some of which would involve policy and secondary legislation changes (see ‘Counter Fraud’ section below for breakdown)
P60s distributed digitally	1	Change in departmental policy
Improved telephony system in Contact Centre	0 to 2	As previously planned
Charging for third party use of NHS Jobs website	0.5 to 3	Requires policy change and market assessment exercise
Additional efficiency in BAU activities	0 to 3	Additional focus by NHSBSA

In addition to these potential RDEL savings, there is also potential for further savings as a result of NHSBSA improving the efficiency of its pensions administration service. The review notes that savings would be realised through a reduction in the levy on NHS employers or in improvements in the service offered as instructed by the NHS Pensions Policy Board. If NHSBSA were to remove half the gap between itself and the best performing pension administrator (after adjusting for scale), it could save over £6 million per year.

Wider system efficiencies

NHSBSA has a proven track record of enabling much larger savings in the wider health system. Since 2015 it has helped to generate savings of £1.9 billion within the wider health system and it estimates that further savings totalling £1.2 billion will be generated in the next 4 years from initiatives already underway. This is presented in tables 6 and 7.

Table 6: wider system efficiencies for 2015 to 2022 and 2022 to 2026 (cut by programme)

Programme	2015 to 2022 (£ million)	2022 to 2026 (£ million)
Provider assurance	778.5	876.3
NHS supply chain	409.4	n/a
Medicines optimisation	107.2	141.7
Exemption checking	283.6	56.3
Other	316.9	115.6
Total	1,896	1,190

Source: finance ALB efficiencies meeting, 28 July 2022

Table 7: wider system efficiencies for 2015 to 2022 and 2022 to 2026 (cut by location of delivery)

Location	2015 to 2022 (£ million)	2022 to 2026 (£ million)
NHSE	1,340.0	933.0
NHS providers	393.0	1.8
CCGs	108.3	141.7
The department	49.6	23.3
HEE	4.0	n/a
Pharma suppliers	n/a	1.7
NHS employing organisations	n/a	89.0
Total	1,895	1,191

Source: finance ALB efficiencies meeting, 28 July 2022

The figures in tables 6 and 7 (2015 to 2022)^{[footnote 6]} set out the efficiency savings delivered by NHSBSA and its system partners arising from the Pacific Programme. The Pacific Programme was established to identify and implement initiatives to reduce costs associated with the system. It closed in 2019, having delivered over £1.16 billion of efficiency savings for the system. Following its closure, workstreams that were originally part of the Pacific Programme were adopted and developed as part of BAU, which has continued the trajectory in delivery efficiency savings yielding the total of £1.895 billion.

NHSBSA has ambitions to achieve more efficiency savings for the period of 2022 to 2026 (at an annual average of £297 million) than it did for the period of 2015 to 2022 (an annual average of £271 million). The efficiency targets for 2022 to 2026 were developed from the forecasts for the workstreams from the following periods:

• 2022 to 2023
• 2023 to 2024

They were used to create 2024 to 2025 and 2025 to 2026 forecasts, using an average of the run rate, adjusted down for any potential future changes in the service. The figures are prudent, based on what is currently known about the future activity of each workstream.

Explanations of the key workstreams are summarised below:

• Provider Assurance: the efficiencies are derived from both pre-and post-payment validation activities and behaviour change for both pharmacists and dentists. The service has been recently expanded to include limited payment validation for both GP and Optometrist payments
• NHS Supply Chain: efficiencies were derived from the price reductions negotiated as part of the development of the supply chain category towers. Savings ceased to be recorded when responsibility for NHS Supply Chain transferred from NHSBSA
• Medicines Optimisation: the efficiencies are generated by tracking the impact of ePact 2 dashboards on prescribing behaviours. Specific dashboards tracked include, but are not limited to, polypharmacy and changes from branded to generic drugs
• Exemption Checking: the efficiencies in this workstream represent payments received from members of the public who have received a penalty charge notice or a surcharge notice due to having received free prescriptions or dental care to which they were not entitled. Previous year’s figures also include behaviour change. The reduction in the scale of future savings is linked to changes in prescription processes that reduce the scope for claiming free care to which patients are not entitled

Further system efficiencies that NHSBSA has the potential to lead or deliver

The review has worked with NHSBSA to identify a number of initiatives across:

• medicines and data optimisation
• provider management
• health and care management
• fraud prevention

These have the potential to generate further system efficiencies and effectiveness, subject to directions. These can be separated into initiatives that could be delivered within:

• 12 months
• 24 months
• longer timescale

12 months

Efficiencies possible within 12 months are those for which NHSBSA has both the skills and systems in place to deliver. These include the expansion of NHSBSA provider assurance function and its opioids dashboard which are considered in detail in the ‘Counter Fraud’ and ‘Data’ sections below. NHSBSA is working collaboratively with the department and intends to seek support from other stakeholders in programmes of work that could deliver savings across the system. This includes the point of care testing in primary care and community settings to free up capacity in secondary care pathology labs.

24 months

Initiatives that could be delivered in 24 months require a higher degree of system redesign and wider engagement from stakeholders. These efficiency savings and improvements in effectiveness are derived from a range of factors such as improving patient safety and population outcomes by addressing key gaps in knowledge, and using data to reduce cost and waste. Medicines and data optimisation is one area in which NHSBSA and the department intend to seek the views of other stakeholders. The collective view is that a joined-up approach to the procurement of medicines and appliances could deliver significant cost savings across the system.

Longer timescale

Longer-term efficiencies and improvements in effectiveness would require further scoping. This would help to quantify the potential scale of financial and patient benefits as well as resource implications for NHSBSA.

NHSBSA has experience in this area, having successfully delivered efficiencies to the system over the lifetime of its Pacific Programme as well as a further £2 billion following the closure of the programme. It is important to note that longer-term efficiency plans will likely require larger-scale system redesign and or investment, in addition to commitment from its leaders to ensure that the people, infrastructure and data is available.

Efficiencies conclusion

Significant system efficiency savings have already been identified as set out in Table 5 and there is potential for much greater savings by the department, NHSE and NHSBSA working more closely together, through a national efficiency programme, to facilitate the delivery of initiatives at scale and at pace. The review notes that delivering wider system efficiencies would require a greater senior management focus. Since there is potential for business efficiencies also to be achieved, this dual focus is likely to put added pressure on the leadership team. The review recommends if there is a conflict, that system efficiencies should take priority over business efficiencies given the larger savings that could be released.

Financial performance

Strong financial management is an important enabler of an efficient and effective organisation. The review has assessed NHSBSA’s financial performance against its budget for the financial years 2020 to 2021 and 2021 to 2022. Tables 8 and 9 below show NHSBSA Q4 consolidation schedule for each year.

Table 8: NHSBSA quarter 4 financial schedule 2020 to 2021

2020 to 2021	Admin £’000	Programme £’000	Capital £’000
Full year budget	75,508	61,437	45,189
Full year outturn	76,243	56,999	37,511
Under (overspend)	(-735)	4,438	7,678

Table 9: NHSBSA quarter 4 financial schedule 2021 to 2022

2021 to 2022	Admin £’000	Programme £’000	Capital £’000
Full year budget	65,366	76,493	42,500
Full year outturn	55,764	70,889	23,546
Under (overspend)	9,602	5,604	18,954

NHSBSA has reported an underspend position in recent years, predominantly against capital allocations. Variances have included those arising from the ESR service due to changing demands against the approved business case funding profile, reflecting changes in NHS growth, uptake in ESR usage and technology utilisation. Reprofiling of ESR programme funding between years has routinely taken place to reflect these drivers, enabling the accommodation of investment, and mitigation of risks, by future proofing technology and infrastructure ahead of the new NHS Workforce Solution Transformation Programme. Overall, the forecast total lifetime costs for ESR remain within the approved full business case funding envelope.

During 2020 to 2021 financial year, NHSBSA stood up or directly supported around 50 COVID-19 services as part of the government’s response to the pandemic. This generated approximately £17 million of additional revenue across the 2 years from prioritising the government’s response. NHSBSA states that prioritising COVID-19 services has meant that it was not possible to secure additional resources to deliver all other planned activity, with large amounts of resource re-allocated to support the response.

The review notes that there is good engagement between NHSBSA and the department’s finance team. The department’s sponsor and finance teams meet with NHSBSA to discuss financial matters regularly throughout the year, and financial matters are subject to scrutiny at the QAR meetings. While the sponsor team has sight of NHSBSA’s financial management through its regular attendance at board meetings and NHSBSA’s Audit and Risk Committee, NHSBSA has noted that developing its reporting for its monthly meeting with the department’s sponsor and finance teams could better support engagement with the department and the financial management of budgets in both the department and NHSBSA. In addition to providing an audit trail, it would support policy teams in developing their understanding of the complexity of funding and service delivery, and the finance team’s understanding of the department budgets used to fund NHSBSA.

Outsourcing

NHSBSA’s delivery functions are achieved primarily through its in-house expertise. However, due to the complex landscape in which NHSBSA operates, it outsources specific functions where there are gaps in capabilities and or it feels the private sector could deliver this function better.

Its approach to ‘right sourcing’ is demonstrated across various services, such as the Vaccine Damage Payment Scheme and the NHS Pensions Service. A useful example to consider in more detail is the ESR, where NHSBSA manages this service, but the delivery of the service is outsourced to IBM. The review notes NHSBSA’s position that it considers this to be the right delivery model because the delivery and digital transformation of ESR is a project that is significant in scale. ESR requires base technology solutions in which the private sector has already invested its development. Developing technology-based solutions in-house would not be cost-effective and would be time-consuming. This would impact the delivery of an essential service widely relied on by the sector. Therefore, NHSBSA feels that it is best to partner with IBM to deliver this function while maintaining effective management.

In contrast, in digital development, the scale and complexity of the development is less significant in comparison to ESR. As such, NHSBSA feels that its student services, for instance, can effectively be performed in-house. NHSBSA digitises its student services, which has provided capabilities to track students’ attendance and has made the process of students being able to receive bursaries quicker and more efficient. The digital aspect of performing transformation functions like these tends to lend itself to in-house delivery with ad hoc support from third-party suppliers. The review agrees with NHSBSA that this is an effective delivery model, considering the scale, complexity and capabilities of NHSBSA, which makes this approach to sourcing good value for money.

While NHSBSA regularly assesses its capabilities to determine whether a particular function should be outsourced, its decision is subject to the department’s approval. The review notes that any proposal for large-scale outsourcing of responsibilities to the private sector would need to be considered carefully on a detailed level, taking account of any longer-term financial impact there might be. In this consideration, due regard would be given to the valuable data NHSBSA collects and generates, which has allowed it to deliver over £1.9 billion in savings over the last 7 years for the benefit of the health system. This might have an impact on the type of data that NHSBSA can collect, which aids the wider system. The review, therefore, finds that NHSBSA has an appropriate approach to outsourcing. NHSBSA’s reliance on its in-house and third-party service providers ensures that complex and often technical functions are delivered according to NHSBSA’s capabilities and capacity.

The review, however, notes that there is no process in the department for reviewing its sourcing arrangements in the way that there is for outsourced contracts. For example, while NHSBSA regularly reviews the balance between insourcing and outsourcing in how it delivers NHS Pensions administration, the department does not regularly review whether the whole service of pensions administration should continue to be provided by NHSBSA or whether it should be outsourced. There have been a number of services, such as the running of the Healthy Start Scheme, which in recent years have been brought in-house to NHSBSA by the department. The review considers that the department should regularly review whether it continues to be appropriate for such services to be insourced, on a similar frequency to that which it would do if the service were outsourced.

Recommendations

1. The review recognises the investment NHSBSA has made in professional workforce planning and workflow management, and the benefits this investment is realising within the operational areas. To identify further efficiencies and build upon NHSBSA’s continuous improvement culture NHSBSA should: - establish a programme within 6 months, which identifies the unit cost for key prioritised services to drive continuous improvement through strategic target setting to achieve greater efficiency - consider expanding its resource management and allocation tools in more areas within 6 months, including its enabling and corporate services

2.In addition to the aforementioned measures taken by NHSBSA, to secure a further 5% efficiency saving within NHSBSA (in addition to the 5% already committed), the department should consider whether a change in its stance on a number of policy issues could help to achieve these additional savings.

3. A national efficiency programme should be established between NHSBSA, NHSE and the department within 6 months to identify initiatives to generate further system-wide efficiencies, with an agreed timeframe for delivery.

4. The department should establish a programme to review, at appropriate regular intervals, whether services should continue to be delivered by NHSBSA or by private contractors.

Efficacy

Cabinet Office guidance on the undertaking of public body reviews defines efficacy as setting the expectations of an ALB on form and function, thereby ensuring that the body meets the conditions to be an ALB, with a clear purpose, in the correct delivery model. It also sets out the expectations that the ALB performs effectively and delivers services that meet the needs of citizens. The first of these requirements concerning assessing the current delivery model was considered in the ‘Delivery model’ assessment section of this report. The second of these requirements was partly covered in looking at service quality and effectiveness within the ‘Benchmarking’ section of this report.

This section considers the approach that NHSBSA adopts to ensure the efficacy of its operations, which enables it in general to achieve high performance levels and meet the requirements of its customers and citizens. It then considers in more detail its efficacy in the delivery of its shared service model, data capabilities, and counter fraud activities to support the wider NHS.

NHSBSA’s approach to ensuring efficacy

NHSBSA has a comprehensive balanced business scorecard (BBS), supplemented by weekly temperature checks, which is used by the leadership team to monitor performance. It is also used by both the board and the department to hold the organisation to account for delivery against defined goals and KPIs, covering issues such as customer experience, financial performance, operational delivery, and people.

The KPIs reported in the BBS are monitored; where they fall short of targets, remedial actions are identified and, where necessary, further investigation is carried out. The KPI measures are reviewed annually and, on occasion, revised during the year to help focus on performance in particular services.

KPIs include:

• measuring volumes of emails and phone calls handled, along with relevant customer satisfaction
• measuring call answering speed, call handling time, and abandonment rates
• measuring whether payments made to delivery partners were timely and accurate

NHSBSA has generally had a high level of performance in meeting its KPIs, having met 90% or more of its KPIs agreed with the department in recent years. The department has recognised this in each Annual Accountability Report.

Shared services

Contact centre

The contact centre is NHSBSA’s most established shared service. It employs 650 front and non-frontline full-time employees who deal with approximately 2.5 million calls and 1.5 million emails annually.

It provides helpline and automated support across 20 different multicomplex workstreams to assist the public in accessing health and care provisions.

NHSBSA’s contact centre is an essential component in ensuring the delivery of healthcare services. The contact centre offers a range of channels for communication with customers, and observations highlighted that the elderly and other vulnerable groups heavily relied on telephone contact with the NHSBSA contact support service. While this correlation is primarily impacted by the type of services provided (for instance, the pensions and the Healthy Start Scheme), it demonstrates how the contact centre supports the public in gaining access to NHS services.

The review notes that the investment, time and effort given to employee development in the contact centre has been fundamental to its success. Feedback from staff is that there is a drive to embed a people focused culture, including genuine care and consideration for employee and customer wellbeing. This is reflected in the number of awards received by the contact centre:

• Gold European Contact Centre of the Year 2020
• Silver UK National Contact Centre of the Year 2021
• North East Contact Centre of the Year 2021
• Gold CCA Team of the Year 2020 (Training, Recruitment and Coaching Team)
• Bronze European Team of the Year 2020 (WFM Team)
• North East Contact Centre People-centric winner 2021

Collaboration across the contact centre’s support and operational delivery teams, and with other departments across the NHS, ensures high quality services.

The review also notes that the contact centre has been a resource that NHSBSA has used effectively to support the government’s emergency response.

Example 3: COVID-19 111 support

At the request of PHE, contact centre support was stood up within 12 hours to assist with 111 during the first wave of the COVID-19 pandemic.

The contact centre dealt with approximately 500 calls daily when the service went live. Initially, 50 agents were trained to provide additional support. This rose to 150 in the first 3 to 4 weeks using existing resource from across the business areas in mainly operational areas.

In the first week of the contact centre being stood up, around 1,300 calls were answered daily. The volume of daily calls peaked at 7,500 in the weeks that followed, with NHSBSA providing 20% of the overall call volume for PHE.

NHSBSA’s contact support ensured that calls were dealt with quickly. The contact centre also identified discrepancies in regional advice, which NHSBSA addressed through scripted responses to ensure consistency in national advice.

The NHSBSA service was vital to the government’s COVID-19 response. It further demonstrates NHSBSA’s capabilities to stand up services, re-prioritise resources and support the system in a matter of hours when required.

Example 4: NHS Test and Trace

In April 2020, the department’s Second Permanent Secretary asked NHSBSA to support the department and PHE to develop the contact tracing service for the emergent NHS Test and Trace. This drew upon the expertise and capabilities of NHSBSA in leading digital and technological transformation, operating an at-scale contact centre and operationalising complex service delivery challenges.

In little over a month, 30,000 contact tracers had been recruited and trained to support this service. Scripts and a knowledge base were developed to support agents in what became Europe’s largest virtual contact centre, and separate contact tracing database and contact centre technologies were integrated and security hardened. This service was a vital part of the government’s pandemic response. It protected the public, saving thousands of lives.

NHSBSA also supported the pre-launch pilot for the contact tracing app. It provided 24-hour contact centre support for symptomatic individuals in the Isle of Wight that needed home test kits. NHSBSA linked users’ addresses with the delivery coordinators on the island to deliver test kits. This function played a key role in providing insight into the app so that it could be scaled out nationally.

Working to challenging deadlines and with a complex dataset, [the NHSBSA] delivered consistently - on time and to a high quality […] meticulous organisation that helped steer us through the project from start to finish. Collaborative working across organisations has been key to the COVID-19 response, and the cross-working between PHE and the NHSBSA to deliver the reporting dashboard is a great example of this. (PHE)

Example 5: Grenfell Tower fire

NHSBSA supported the Coroner’s Office in identifying individuals caught in the Grenfell tower block fire. NHSBSA performed searches against patient data (lawfully collected and held by NHSBSA) to ascertain NHS records to assist with cases.

Data sharing agreements were established to enable a third-party supplier to assist the Metropolitan Police with their investigation. This allowed them to prioritise data searches against patient records to enable the Metropolitan Police to have up-to-date information.

NHSBSA acted flexibly to play an important role in response to this tragic incident.

The review finds that NHSBSA’s contact centre is a key organisational strength. NHSBSA’s ability to rapidly use and adapt its contact support service was key to the success of the government’s COVID-19 response. The review finds strong evidence of NHSBSA’s capabilities as the emergency contact centre. NHSBSA’s ability to use agency staff to surge capacity has enabled it to deliver services at pace. Contact centre resource, however, is a general concern as high attrition and the expansion of services could otherwise result in customer service deterioration.

Based on its performance in emergencies, the review considers that there is potential for NHSBSA to provide a rapid response ‘contact centre hub’ when required. Additionally, a scoping exercise should be undertaken to consider the feasibility of NHSBSA becoming a contact centre hub as part of its shared service offer to the department and other ALBs.

In order for this to be delivered in England and Wales, Welsh language obligations would need to be addressed. Legislation and devolved policy require public bodies to make proportionate and appropriate arrangements to ensure that national services are delivered in the Welsh language. Welsh language and funding obligations should therefore be considered jointly by the department, NHSBSA and the Welsh Health and Social Group to clarify how it would fulfil this commitment.

Primary care services

NHSBSA primarily performs processing and payment services to NHS professionals. It processes payments to 90% of pharmacists and all dentists in England. This demonstrates NHSBSA’s transactional capabilities in making payments at a national scale. However, NHSBSA does not currently process payments to GPs and optometrists, which is carried out under a separate outsourced contract.

The review is pleased to note that the NHSBSA November BBS details that within its primary care services, 100% payments were made on time and with 100% accuracy.

NHSBSA is of the view that if it were responsible for all primary care transactions there could be cost benefits through fewer errors, a more cost-effective service and better integration with the provider assurance work that it already carries out on GP payments. The review has not carried out a cost-benefit analysis of NHSBSA providing this service compared to its delivery from other payment services. However, the review determines that there would be merit in such an analysis being carried out by the department and NHSE to consider options for the service once the current contract ends.

NHS Jobs portal

NHS Jobs is the official online recruitment service for the NHS. The NHS Jobs portal was launched in 2014 and transitioned to NHSBSA in 2018.

NHSBSA identified that NHS organisations were supplementing and/or replacing the NHS Jobs portal with third-party job portals, costing the NHS £6 million to £8 million per year. There was, therefore, a need to improve the NHS Jobs portal to offer functionality to track applications through the process. This had been identified as the main reason that NHS organisations were using third-party job portals. NHSBSA undertook a programme of activities to identify how it could improve the NHS Jobs portal. NHSBSA decided that developing a new service would help ensure that users’ needs were met and would avoid needing large-scale changes every 3 to 4 years.

The new NHS Jobs portal will be rolled out in 2023. It will allow NHS organisations to use the Jobs Board for free, enabling data tracking to improve the recruitment process nationally. The review finds that the NHS Jobs portal provides significant value for the NHS, as the system helps to support the recruitment landscape, which workforce challenges have compounded due to EU exit and COVID-19.

HR shared services

HR shared services can offer benefits, including cost savings, integrated information technology and the opportunity to build more robust capabilities. In 2018, the Cabinet Office launched its Shared Services Strategy for government. The objective is to bring together the core functions of business into a single simplified centre that delivers efficiencies. In line with Cabinet Office guidance, the review considered the NHSBSA shared services model and its alignment with government’s wider strategy.

NHSBSA provides shared recruitment services to NHSE, NHSCFA, the Health Research Authority and the Graduate Management Training Scheme. Its systems manage the end-to-end recruitment process by providing complete information about recruitment campaigns and an audit trail for individual applications.

The current basis on which NHSBSA provides shared services is dependent on various factors, including whether NHSBSA already performs similar functions, whether a national service is required, and whether NHSBSA can be awarded the contract without competition. The review endorses such an approach and feels that there may be opportunities for other ALBs to make use of NHSBSA’s shared services, generating potential cost savings.

NHSBSA is not currently structured or funded to compete with third-party suppliers for delivery of shared services. The review agrees with NHSBSA that there is a risk associated with NHSBSA expanding its shared service remit without having the funding necessary to cover business development and bidding costs.

The review also considered whether NHSBSA might extend its shared services offer to local NHS trusts. Currently NHSBSA does offer standalone digital pre-employment checking to the North East Ambulance Service NHS Foundation Trust and the Tees, Esk and Wear Valley Foundation Trust. The review would advise against NHSBSA seeking to enter the market of providing shared services to individual NHS trusts. This is because there is already an active market of suppliers of shared services to NHS trusts, which would require significant management focus and some risk capital from NHSBSA.

Recommendations

1. There is potential for NHSBSA to provide a ‘contact centre hub’ when rapid response is required. A scoping exercise should be undertaken within 6 months to consider the feasibility of NHSBSA becoming a contact centre hub, with the focus on contact centre performance, to determine NHSBSA’s suitability in providing this shared service more widely.
2. As part of its consideration of the scope for greater use of shared services across its ALBs, the department should consider the contribution that NHSBSA’s shared service offering could make towards this objective within the next 12 months.
3. There is merit in NHSBSA holding all primary care service contracts, which should be explored jointly by the department and NHSE through a cost and benefit analysis of delivery options.

Data

NHSBSA’s data capabilities have developed over the past 5 years. It is committed to the principles highlighted in the health and social care data strategy and is fully aware of its responsibilities in relation to data protection, the Caldicott principles, data security, and the use of any personal data. It has robust information governance processes and procedures, together with a data governance framework, to ensure its data is being managed as an asset and is being used in a safe and secure way. Its use of data science has enabled NHSBSA to provide important data insights to wider system partners. This has supported the provision of healthcare services and can help to improve decision making within the NHS at a local and national level.

Example 6: opioid prescribing comparators dashboards

In May 2022, NHSBSA worked with Wessex Academic Health Science Network to deliver clinical dashboards to enable GP practices, primary care networks and integrated care systems to understand opioid prescribing patterns.

This was to address the issues highlighted in the PHE Prescribed Medicines Review report regarding the potential risk of addiction if individuals are prescribed opioids for a prolonged period of time.

Since the launch of the dashboards, it receives on average 3,000 hits per month.

The review recognises that data insights on opioids prescribing patterns can improve patient outcomes. However, the review notes that the dashboards could have a greater impact on patient care if more primary care networks and GP practices used this resource. The review agrees with NHSBSA that it should continue to work with sector partners to maximise the dashboard’s potential.

Given the scale of data that NHSBSA collects, the review notes that there is potential for this data to be used more widely to improve health outcomes. Highlighted below are 4 areas of potential:

• cancer care treatment
• children with special educational needs
• care home prescriptions
• workforce management

Cancer care treatment

NHSBSA collects data on drug prescriptions used to treat cancer in primary care. However, NHSBSA does not capture the clinical indication of a prescription and therefore it does not know why a prescription was issued, or the condition it is intended to treat. NHSBSA feels that it can support the provision of care treatments if data could be married with clinical indications for different type of cancers. Data insight could accordingly be produced on the variation in prescribing patterns to improve the quality of care for cancer patients.

Children with special educational needs

NHSBSA can identify drugs prescribed to children. NHSBSA stated that if it had indicators of special educational needs, it would be able to produce valuable data insights to inform the use and management of medicines. This is particularly important in a post-COVID-19 climate, where the pandemic has exacerbated health disparities among vulnerable groups. Therefore, harnessing data in this way to support children with special educational needs could aid the response to this ongoing issue.

Care home prescriptions

NHSBSA does not produce data sets on data prescribing patterns in care homes. However, it has developed the methodology to identify residents in care homes which could be used to consider selected areas of prescribing patterns in care homes, such as nutrition, benzodiazepines, laxatives and painkillers. NHSBSA feels that if it had direction to collect this form of data, it could optimise medicines management. This would reduce cost and waste, and improve quality of care and patient safety. The extent to which a direction is the appropriate legal vehicle should be considered by the Government Legal Department (GLD).

Workforce management

NHSBSA collects and holds data on student services, recruitment services, HR shared services, the ESR, and retirement services. This uniquely places NHSBSA in a position to produce data insights on all elements of the NHS workforce journey. However, currently NHSBSA is unable to use the data to provide an end-to-end picture of the NHS workforce.

If NHSBSA could use data sets more readily, NHSBSA could support the health and social care system with workforce planning. NHSBSA considers that the data from its various workforce platforms could be used to provide a greater understanding of recruitment and retention challenges in the NHS. More crucially it could also provide insights into where there could be workforce gaps or the areas where recruitment should be targeted. There is a shared consensus among NHSBSA and the department that a new direction could facilitate this, subject to legal advice. The review notes that there are legal risks associated with the use of personal data, which need to be considered in detail with NHSBSA, the department and the GLD. The merits of this are currently being considered by the department with the GLD.

NHSBSA should continue to ensure any proposed processing of data is in line with legal powers, data protection legislation and the common law duty of confidentiality. Pseudonymised, anonymised and aggregated data must be considered as an alternative to using personal data.

The review further notes feedback from UKHSA that “the NHSBSA have been really helpful when it comes to data provision to UKHSA”. Access to primary care prescribing data has proved a valuable tool in many areas of UKHSA work, including the programme of work to combat antimicrobial resistance. There is potential for NHSBSA to support the wider system more broadly. However, the types of data that NHSBSA can produce or provide to sector partners would need to be scoped to raise awareness of what is available.

Recommendations

1. NHSBSA should continue to explore the opportunity to leverage and maximise the use of its data to improve patient and population health outcomes.

2. NHSBSA should work with the department, NHSE, UKHSA and GLD to map out the type of data sets that it is able to produce to assist work of key sector partners, and consider the proposed processing of that data in line with legal powers, data protection legislation and the common law duty of confidentiality.

Counter fraud

Fraud is a significant risk to the UK public sector and has far-reaching financial and reputational consequences. According to NHSCFA, for the years 2021 to 2022, it is estimated that the NHS in England is vulnerable to £1.198 billion of fraud, bribery and corruption. This is a rise of £58 million from the previous year, which can be attributed to increased funding during COVID-19 rather than evidence of increased levels of fraud.

Relationships and system architecture

NHSBSA operates as part of a wider counter fraud system that seeks to tackle and minimise fraud vulnerabilities across the NHS. This wider counter fraud system includes:

• the department’s Anti-Fraud Unit
• NHSCFA
• the department’s Counter Fraud Board
• NHSE

The department’s Anti-Fraud Unit sets the overall counter fraud policy and strategy for the department and wider health group. It raises awareness and understanding of fraud and supports the department’s policy teams and companies, as well as ALBs, to minimise fraud, error and waste.

NHSCFA leads the counter fraud function in the health service in England. It is an intelligence-led organisation that monitors counter fraud performance across the NHS system by identifying, investigating and preventing fraud as well as other economic crimes. It also produces a Strategic Intelligence Assessment every year on behalf of the department to assess fraud threats, vulnerabilities and enablers in accordance with the NHS Counter Fraud Authority Directions. It then develops solutions with system partners.

NHSE is responsible for investigating the majority of primary care fraud allegations where it is accountable and where the loss would relate to NHSE. It has its own counter fraud Team that works collaboratively with NHS integrated care boards partners and NHSBSA to manage primary care provider performance and contract compliance.

The department’s Counter Fraud Board brings together organisations and provides strategic oversight and coordination of the counter fraud agenda. The board comprises senior representatives from the department, NHSE, NHSBSA, NHSCFA, UKHSA and the Public Sector Fraud Authority. Each representative is accountable for a specific counter fraud activity and has the authority to make decisions on behalf of their organisations.

NHSBSA is responsible for producing data insights for counter fraud. It has an important role in sharing data that supports its partners in investigating and minimising fraud, loss and waste, as well as recovering those losses. Each system partner performs a distinct role in the counter fraud space to ensure potential fraud is minimised and investigated thoroughly. A key strength of the system architecture is that, despite working independently and performing these distinct functions, there is a good collaborative relationship between organisations that ensures best practices are shared across the system. This has enabled more fraud and waste to be detected and recovered year on year.

The review notes, however, that there could be greater clarity over the remit and responsibilities of each organisation when new services are taken on. If there is a significant new fraud risk, this should be communicated and reported against through the department’s Counter Fraud Board agenda, so that all parties are updated and aware of where these risks fall. Additionally, each partner’s counter fraud responsibilities should be regularly assessed by the department to facilitate further collaboration to support the NHS system.

NHSBSA activity

NHSBSA’s counter fraud function is responsible for embedding fraud prevention and detection across all its services. In collaboration with NHSCFA and NHSE, it focuses on 8 of the 13 thematical areas NHSCFA assesses in its Strategic Intelligence Assessment:

• prescription fraud
• GP contractors
• pharmaceutical contractors
• optical contractors
• dental contractors
• NHS bursaries
• NHS pensions
• reciprocal healthcare

In relation to fraud and error, NHSBSA carry out 3 main strands of activity:

• prevention
• detection
• holding to account

Fraud prevention begins with due diligence. New services are assessed for potential fraud risks so that prevention is factored into the service design. The due diligence process has been a positive fraud prevention tool for NHSBSA. It ensures more open engagement and that the counter fraud process is linked with other areas such as data, HR, estates and IT for an initial assessment before a full risk assessment is possible.

The Real-Time Exemption Checking service (RTEC) is a fraud prevention mechanism adopted by NHSBSA to minimise the threat of fraud.

Example 7: RTEC and prescription charge patient exemption fraud

NHSBSA provides prescription services in England. It processes all NHS prescriptions that are dispensed in primary care settings.

In 2019, the RTEC service was launched. RTEC enables pharmacists’ systems to digitally check in real time whether patients in England are entitled to free prescriptions. Out of 227 million checks since the start of RTEC, 101 million have been found to be exempt. This removes some of the administrative burden on pharmacists and, importantly, also helps to reduce fraud and error in the NHS by ensuring that prescriptions claims are correct at the point of dispensing, rather than being checked retrospectively.

Pharmacists are not obliged to use RTEC and NHSBSA has been promoting the many benefits of this service for both the patient and the pharmacy in collaboration with the Pharmaceutical Services Negotiating Committee. Uptake from pharmacies is currently at around 90%.

The review notes that there are some limitations to RTEC. This includes reliance on patients to update their GP records and the Department for Work and Pensions to ensure data accuracy. To mitigate the limitations, NHSBSA undertakes the Prescription Exemption Checking Service (PECS). This verifies eligibility for free prescriptions after the point of dispensing. If a patient claims a free prescription and NHSBSA cannot verify the exemption, the patient is sent an enquiry letter asking them to confirm their entitlement.

This approach encourages patients to get in touch with NHSBSA to discuss their exemption status and, if appropriate, records will be updated. If the patient fails to respond within 28 days, they will be sent a penalty charge notice (PCN). Where a patient fails to pay the fine or respond within 28 days of the PCN being issued, they may be liable to pay an additional surcharge. If this is not paid, court proceedings may apply. NHSBSA has seen positive behavioural changes as a result of the introduction of the enquiry letter. In 2018, NHSBSA created the PECS Repeat Offender Team to work with those who had incurred a high number of PCNs to educate them on the exemption certificates available and to hold to account those who incorrectly, but continually, claimed exemption. The review notes the value of RTEC in helping to minimise fraud and agrees that NHSBSA should continue to promote the use of RTEC within pharmacies in England.

The review notes the benefits of the Electronic Prescription Service (EPS) as a further fraud prevention mechanism. EPS sends electronic prescriptions from GP practices to pharmacies and is a necessary component for pharmacies accessing RTEC. Currently, EPS accounts for 89% of all prescriptions dispensed in England. The review recognises that maximising movement from paper prescriptions to EPS could generate savings, which NHSBSA estimates would be in the region of £6 million. This would reduce administration costs and minimise patient fraud, as electronic prescriptions are more secure. Solutions have been identified for moving from paper to electronic prescriptions for most categories, although in some cases there would be additional costs and expenditure to facilitate a move to EPS. Table 10 below sets out potential opportunities to increase the use of EPS.

Table 10: breakdown of the continued use of paper prescriptions

Category	% total prescriptions (NHSBSA estimates)
Dispensing doctors	5.0
GPs using paper when EPS functionality supports use	3.3
Dentists/optometry	0.7
Secondary care	0.6
Complex prescribing	0.5

NHSBSA also operates a Dental Post Exemption Checking Service (DECS) which includes a debt recovery element that has been in operation since before NHSBSA took over its administration. In total, over £100 million has been recovered from incorrect prescription and dental treatment claims since 2014.

In terms of detection, complete fraud risk assessments are produced by NHSBSA for its operational and corporate services. There is sufficient oversight of these risks with the NHSBSA Loss and Fraud Prevention Team, which reports to the Audit and Risk Committee and the Corporate Risk Register. Risks are then managed through service risk logs and forums for monitoring and review.

NHSBSA’s provider assurance processes are a further tool to detect error. Its provider assurance functions cover the 4 primary care contractor groups: dental, GP, optometry and pharmaceutical services. As part of this work, the NHSBSA Provider Assurance Team ensures that primary care providers understand and meet contractual obligations and the expected standards of treatment informed and supported by NHSBSA clinical advisors. NHSBSA works with the Care Quality Commission (CQC) to ensure processes are aligned and complementary to the CQC’s role as regulator.

The PA Team works closely with the NHSBSA Loss and Fraud Prevention Team and the NHSE Counter Fraud Team to share intelligence. Areas of risk and individual cases are highlighted to the PA Team to include in assurance reviews or escalated for potential fraud investigations. The team also shares intelligence with NHSCFA to inform the risk ratings within the Annual Strategic Intelligence Assessment.

Example 8: provider assurance - dental contractor fraud

In collaboration with NHSE, NHSBSA developed a provider assurance dental service function with one of the key areas of focus to minimise loss and fraud around financial payments.

The types of activities provided by its team of dental clinical advisers and caseworkers include:

• risk analysis using insight from outcome data sets, activity and treatment data, and payment transactions
• identification of unusual and outlying performance
• appropriate interventions and escalations
• routine reporting on performance to commissioning bodies and providers
• sharing best practice to drive behaviour change, including provision of self-assessment tools
• post-payment reviews or post event reviews

The latest Strategic Intelligence Assessment shows the fraud vulnerability for dental contractor fraud is around £61.8 million, down from £126.1 million in 2018 due to the exercises carried out by the dental PA Team.

The review recognises the value in the provider assurance work undertaken by NHSBSA in generating efficiencies for the wider system. Between 2021 and 2022, the provider assurance contracts generated savings of £61 million. This is in terms of actual fraud recovered (£3.5 million) and prevented (£50.7 million), and efficiencies from prevention through behaviour change (£6.4 million).

Since 2015, NHSBSA has generated a gross benefit of over £238 million through provider assurance services, which includes financial recoveries, behaviour change and deterrent effects. There has also been the management of over £448 million worth of contract performance adjustments.

NHSBSA forecasts current provider assurance services will generate a further £68 million in system savings in 2022 to 2023. There is potential to generate further efficiencies if NHSBSA’s provider assurance activity were to increase. This should be examined as part of the proposed national efficiency programme with NHSE to identify and realise system efficiencies.

NHSBSA holds individuals and organisations to account by investigating and making appropriate referrals to its system partners where the alleged fraud activity falls within their remit. Since 1 April 2022, NHSBSA’s Provider Assurance Team has made 16 referrals to NHSE in relation to primary care services. Once referrals have been investigated and fraud confirmed, NHSBSA holds individuals to account through its recovery mechanisms.

Counter fraud functional standards

The Government Counter Fraud Functional Standard: GovS013 sets the expectations for managing counter fraud, bribery and corruption activity for public bodies. A Health Peer Review of NHSBSA’s compliance against the functional standards was conducted in June 2022. This, and a previous assessment conducted in 2020 by the Centre of Counter Fraud Expertise, demonstrates continual improvement against the standards. To date, NHSBSA has fully met 10 out of the 12 standards. The 2 partially met standards identified as areas of improvement relate to NHSBSA’s:

• loss and fraud strategy
• outcome-based metrics

Loss and fraud strategy

The Health Peer Review assurance report notes that while NHSBSA has a loss and fraud strategy that reports on system-wide risks, there needs to be focused sections on fraud risks that NHSBSA is directly responsible for.

Outcome-based metrics

The Health Peer Review indicates that both NHSBSA’s Workplan and Control Framework (which together make up the Action Plan) do not include clear metrics, including financial metrics, that summarise the outcomes that it is seeking to achieve each year. Therefore, an area for improvement is through SMART metrics, which should be included in both.

The review notes that NHSBSA is taking steps to address these areas. Part of its short-term strategy is to develop approaches to meet the remaining standards by working closely with system partners to ensure alignment.

Recommendations

1. All new significant fraud risks should be communicated and reported against through the department’s Counter Fraud Board agenda, so that all parties are updated and aware of where these risks fall.

2. Each partner’s counter fraud responsibilities should be assessed annually by the department to facilitate further collaboration to support the NHS system.

3. The department should continue work to optimise the use of EPS and RTEC, as both have the potential to further reduce fraud and error, and generate efficiencies.

Capabilities

This section considers the digitisation, cyber security and workforce capabilities of NHSBSA, and how these capabilities meet the needs of citizens through the delivery of essential services.

Digitisation

NHSBSA’s digital capabilities are a key aspect of its strategy to deliver efficiencies for the NHS system, value for money for taxpayers and service improvements, leading to better health outcomes for the public. NHSBSA has invested in its digital function and has built this capability by working in partnership with IT software providers to develop new technology solutions. Through its digital work, NHSBSA aims to meet policy intent and user need by delivering services that are accessible, inclusive and cost-effective for the NHS.

Service design

NHSBSA uses the NHS Service Design Framework and UK government Service Manual, with an internal user centred Design Team made up of user researchers and service designers to ensure services are built to meet user needs and meet the UK government Service Standard. NHSBSA uses user insight to inform future design iterations and potential policy changes. Customer satisfaction data is also collected and used to inform future research priorities and to identify trends from live services. User research and data insights in particular are used when an existing service is updated.

NHSBSA designs all services with an assisted digital route, such as the contact centre, to ensure that people without access to technology are able to access NHSBSA’s services. Furthermore, all digitised services designed by NHSBSA are disability assessment compliant. NHSBSA conducts user research to gather information about users’ digital literacy, online habits and abilities. It engages with end users throughout the digital transformation process by using the Government Digital Service (GDS) digital inclusion scale and the NHS design system.

Example 9: student services

In 2020, the government announced that healthcare professional students would receive a non-repayable maintenance grant of £5,000 per year and extra payments of up to £3,000. This is in addition to being able to apply for a student loan.

The NHSBSA Student Services Team was directed by the department to administer these payments to students under the NHS Learning Support Fund (NHS LSF). The policy for awarding NHS LSF payments was developed alongside a brand-new digital application system, with digital upload functionality, and a dedicated portal for higher education institution (HEI) admin staff.

The full system was required to be fully operational and able to receive applications by mid-summer 2020. In addition, buy-in was required from over 80 HEIs across England for their staff to receive training from NHSBSA to provide enrolment and course attendance data for their students via the HEI portal.

The NHS LSF application system went live in July 2020 and within the first 24 hours, NHSBSA Student Services received around 40,000 applications from new and continuing healthcare students. The first batch of termly payments were scheduled to be paid to all eligible students after 1 November 2020, and during that month around 70,000 students received their first NHS LSF payments.

In the first year of operation, NHSBSA’s Student Services paid over £400 million in NHS LSF allowances to eligible healthcare students and the Scheme policy continues to be developed annually in partnership with the department. Interest from students is growing year on year, with application numbers peaking at 129,000 in 2021 to 2022 to a value of £549 million.

The digitisation of this service has improved end-user experience as 70% of students are able to apply for additional financial support. End-users can receive a decision on their eligibility for this scheme more quickly than via the paper route.

The digitisation of NHSBSA’s services has also had a positive impact on improving the health outcomes of vulnerable groups such as those benefitting from the Low-Income Scheme. This enables people on low incomes to apply quickly and easily for help with their health costs. Wider healthcare benefits include ensuring that important healthcare services are accessible, and the review finds that NHSBSA is taking the right approach to digitising services to both generate efficiencies and meet user need.

NHSBSA has undertaken some work to digitise the NHS Pension service as the current system is complex and challenging for end-users. A digitised system would reduce the administrative strain on users. Areas that would benefit from digitalisation for pension members include:

• digital annual allowance statements
• digital refund applications
• the ability to apply for retirement benefits online and access to personal electronic documents

For employers, the transformation of the Employer Pensions Service would ultimately replace the current tool, ‘Pensions Online’, to improve user experience, increase opportunity for self-serve and modernise technology. Benefits of digitalisation for employers include:

• reducing the administrative burden and error handling by reducing employer contact by telephone, email and post
• building a service to better meet user needs around employer processes rather than imposing conflicting processes

NHSBSA recognises the importance of this work, and the review agrees with the prioritisation of the transformation of the pension service to improve efficiency and end user experience. It should also be noted that creating a favourable reputation for NHS Pensions would both retain and attract staff to the healthcare sector.

NHSBSA has best practice standards in place to ensure that services are designed to meet end users’ needs, as evidenced by NHSBSA’s status as an assured organisation by the department and GDS, along with its pedigree in meeting GDS assessment standards. It recognises that digital transformation needs to have an end user focus to ensure that services are accessible for citizens and the broader NHS system.

Example 10: Manage your service (MYS)

MYS is a web-based platform that offers online services to primary care contractors. NHSBSA designed MYS following feedback from pharmacists that the previous system was administrative-heavy and involved a lot of paper processing.

Pharmacists were consulted during a number of development phases to create a product that met the user need and directed the focus towards patient care. This began with discovery-style research, to gain insights on current practices and needs. Then, when moving to Alpha, prototypes were tested with staff to input mock data into screens, replicating what a potential new product could look like. These insights were then taken to inform development work of the real product and service, to improve efficiency of data collection and processing.

MYS is now used by 99.8% of community pharmacies in England and provides over a dozen claims for contractors to complete for services such as COVID-19 vaccines, seasonal influenza, Pharmacy Quality Scheme, NHS Community Pharmacist Consultation Service and Discharge Medicines Service.

Feedback from pharmacists has been positive with end users finding MYS accessible and user-friendly. The MYS demonstrates how NHSBSA’s digital capabilities enables it to meet user need while driving efficiencies across the sector.

The review also notes that NHSBSA launched its ‘accessibility (a11y) lab’ in 2019. This enables NHSBSA to develop with individuals with accessibility needs in mind. The review finds that NHSBSA takes proactive steps to ensure that its digital platforms are able to meet the varying needs of end users.

The Digital Data and Technology (DDaT) team

NHSBSA’s DDaT Team comprises 534 members. This includes one chief DDaT officer and 14 heads of services. NHSBSA grows its internal digital capabilities through apprenticeships, training and communities of practice. It also uses external partners to support its core delivery teams when required.

Staff undertake training provided by the GDS Academy for all product owners, to ensure consistent ways of working. NHSBSA also has a playbook in development to support all colleagues for standardisation.

In addition, NHSBSA has an internal service assessment community, which provides Service Standard reviews and mock Service Standard assessments to the digital delivery teams. This community is made up of individuals across the core professions of user research, design, technical and delivery management - all of which have received assessor training. Feedback from the review or mock assessment is used by the digital delivery teams to produce Central Digital and Data Service Standard assessments. These assessments show how well a service is performing.

Recommendation

Over the next 6 months, NHSBSA should make progress with its work on the digitisation of the pension service to improve user experience and generate efficiencies.

Cyber security

Due to the expansion of NHSBSA’s DDaT function, cyber security is an ever-increasing focus for NHSBSA. NHSBSA has outlined its 5 towers: Identify, Protect, Detect, Respond and Recover, which are key to a successful and holistic cyber security program. The programme is supported through adherence to the HM Government Cyber Security policy framework Minimum Cyber Security Standard and the National Institute of Standards and Technology cyber security framework. Cyber security leads within NHSBSA work in partnership with colleagues across the organisation to embed security controls, based on ISO 27001 and Centre for Internet Security controls, as required by government policy and standard at all levels and systems, to ensure that NHSBSA systems and services are robust, resilient and secure.

NHSBSA conducts an annual review of compliance with the Government Functional Standards, which is managed centrally by the Corporate Governance Team. The review is undertaken in August each year, as part of an annual review of the Corporate Governance Framework. The review notes that in the most recent assessment, NHSBSA was held to be fully compliant with the Cyber Security Functional Standards.

The department is aware that NHSBSA completes the Data Security and Protection Toolkit (DSPT). The DSPT is a mandatory annual review for organisations which access and use NHS patient data. The review recommends that NHSBSA should continue to ensure resource is directed towards meeting the standards set by the DSPT as this is a mandatory requirement. It should be noted that the DSPT is being updated and revised to align more closely with the Cyber Assessment Framework set out by the National Cyber Security Centre.

Furthermore, the review recommends investigating whether NHSBSA’s August assessment could be brought forward to May or June to align with the timelines of the DSPT submission (June). This will enable NHSBSA to include the assessment as supplementary evidence of meeting DSPT standards.

Finally, the review notes the current threat across the cyber landscape, particularly the ransomware attacks against Ireland’s Health Service Executive and the health sector supplier, Advanced. In light of these incidents, it is recommended that NHSBSA considers the cyber security support being offered to it centrally by the department and NHSE.

Workforce

Culture

The culture of NHSBSA is integral to the successful running of its operation. Staff workshops and interviews conveyed that the culture at NHSBSA is overwhelmingly positive. The majority of respondents in the staff workshops stated that there is a ‘supportive environment’ at NHSBSA, referring to the organisation as a ‘family’.

NHSBSA has 4 core values: Collaborative, Adventurous, Reliable, and Energetic. These values reflect that NHSBSA is people-focused; NHSBSA ‘CARE’ about its staff. The review finds that CARE was felt to be underpinning the organisation’s culture across all the different staff workshops held.

The leadership team at NHSBSA has played a key role in developing a strong culture within the organisation by remaining transparent and open. The CEO, Michael Brodie, as one respondent stated, “lives the values of the organisation”. The leadership team has regular question and answer sessions with staff to make them aware of business changes and broader service developments.

The review further notes the staff’s shared sense of enjoyment for the work they do at NHSBSA. Many respondents stated that working at NHSBSA enables them to give back to the community. This was reinforced by the role NHSBSA played during the COVID-19 pandemic in standing up new services.

Furthermore, its 2-star accreditation (demonstrating ‘outstanding’ commitment to workplace engagement) in 2021 from Best Companies and ranking as the best not-for-profit organisation to work for in the UK at the end of 2022 is evidence of the work that NHSBSA has undertaken to develop a culture where people enjoy working for the organisation. This is particularly important in the current economic climate, where the cost-of-living crisis has impacted salaries. This has benefits for attracting people to NHSBSA and retaining them.

NHSBSA’s hybrid working policy was introduced under the ‘Our Way Ahead Programme’ based on the feedback of over 1,000 staff. The review notes that colleagues are receptive to the NHSBSA hybrid working policy, which gives staff the option of coming into the office but is not mandated. Union representatives have stated that the hybrid working policy has meant that internally now there are more opportunities for advancement as staff are not compelled to move to where jobs are being advertised.

The review considers that connectivity, innovation and overall business identity could be lost if the right balance is not struck in a hybrid working environment and this should be subject to continuing review by NHSBSA.

Recruitment and retention

NHSBSA uses a combination of recruitment agencies and its job platform, NHS Jobs, to source talent. Recruitment agencies are relied upon to recruit and internally employ staff in the contact centre. NHSBSA stated that this was mainly due to the COVID-19 pandemic, as services had to be established quickly. While the pay for agency and permanent staff is the same, additional costs are incurred by using recruitment agencies. NHSBSA has managed this by having a 16-week onboarding process to offer agency staff permanent employment contracts. The review notes that only 10% of staff in the contact centre are agency workers.

In the medium term, NHSBSA expects the reliance on agency staff to diminish. Unexpected fluctuations in service contact volumes post the COVID-19 pandemic have required flexibility of agency recruitment in a way not experienced prior to the pandemic. Once NHSBSA has a baseline forecast from this period, it expects to build more non-agency recruitment into its plans and reduce reliance on agency staff. However, NHSBSA generally notes the high levels of attrition and staff turnover in call centres. Therefore, reliance on agency staff is not abnormal for this sector, particularly during challenging periods. While reducing the use of agency workers will increase efficiencies in the medium to long term, the review determines that the NHSBSA recruitment process, at present, is appropriate to recruit and retain staff in a particularly challenging labour market.

The review acknowledges the numerous and considered training opportunities for staff across the business, and the positive impact this has on retention. Best Companies stated that the focus on the growth and development of staff, coupled with a focus on wellbeing, are reasons why staff choose to stay at NHSBSA.

In addition, its corporate offering is development focused. NHSBSA has increased its learning and development opportunities for staff to enable growth within the organisation. Its ‘Virtual Learning Resource Centre’ offers an extensive library of multi-sensory digital content for all colleagues and includes self-assessments to help identify development and skills gaps. Moreover, its ‘My Leadership Pathways’ offers leaders and aspiring managers a range of online development workshops. NHSBSA also has a targeted Career Pathway Programme at a corporate and operational level. These are designed to enable colleagues to explore and experience a range of development and career opportunities outside their current roles and are highly valued by staff.

The example below illustrates NHSBSA’s strategic approach to staff development:

Example 11: the apprenticeship programme

Apprenticeships at NHSBSA provide staff with the opportunity to gain relevant experience and qualifications within the organisation. This aims to help future career progression through professional development.

The apprenticeship programme is underpinned by 3 main drivers:

• to create social mobility for people internally and externally
• to provide opportunities for people to develop their career ambitions at NHSBSA
• to support addressing the medium to longer-term skills gaps within services

NHSBSA’s Talent Acquisition and HR teams work to identify areas where the introduction of specific apprenticeship roles would supplement their current skills and help generate a pipeline of future capabilities. This would also ensure that NHSBSA remains a competitive employer, particularly in areas where roles are hard to fill.

Currently, there are 72 colleagues enrolled in an apprenticeship, 49 of which are internal colleagues and 23 of which were externally recruited.

The review finds that NHSBSA invests sufficiently in its people to provide development opportunities that will provide challenge and growth. NHSBSA is aware that a lack of development opportunities can affect staff retention. The review determines that it has adopted the right strategy to retain talent, given its restrictions in other reward areas such as pay.

However, NHSBSA should continue to monitor the shifting professional landscape. It has traditionally relied upon being able to employ skilled staff who wish to live in areas where NHSBSA is based such as the North East and North West. However, the growth of virtual working since the COVID-19 pandemic has meant that the link of location of work and residence is now less strong. Therefore, highly skilled staff may find higher paid equivalent roles outside the organisation. The review finds that this is a significant risk to NHSBSA’s future success as an organisation. If it is unable to retain or attract the high-quality staff in areas such as digital and data analytics, this could affect the quality of its services. It could also require a shift in the balance between in-house and outsourced provision in areas where specialist skills are required.

Pay and reward

While staff turnover rate at NHSBSA is typical for a business of its size, at 8%, pay has been highlighted as a retention issue. The review notes that many respondents in the staff workshops feel that private companies pay higher salaries for comparable roles. The review recognises that NHSBSA is restricted by the NHS Agenda for Change - the grading and pay system for NHS staff - which dictates the pay scales that NHSBSA can work with. However, the review notes that NHSBSA has made some pay scale adjustments, in order to support staff who fall into lower pay brackets with cost-of-living challenges.

As of 1 April 2022, NHSBSA has moved all staff in Band 2 pay scale to the top of the Band 2 threshold. This pay adjustment will also apply to all future staff in this pay bracket joining the organisation. Union representatives, however, feel that the Band 2 pay is often not enough as the pay scale is close to the national minimum wage. This makes it difficult for NHSBSA to retain staff, particularly call centre staff, when call centre competitors in the North East are offering a higher pay. This is a particular issue in the DDaT area, where competitors can offer higher pay for specialised DDaT roles. As pay is the primary reason why people leave NHSBSA, this presents a challenge in the current economic climate.

NHSBSA has developed an extensive reward package. This includes the White Goods Scheme, the Cycle-to-Work Scheme, and a generous Pension Scheme. NHSBSA has also launched the ‘We CARE Colleague Recognition Scheme’, where staff can nominate anyone, irrespective of grade. The review finds that while some colleagues were aware of the benefits package, this was not consistent across all business areas. Therefore, NHSBSA should continue to work on advertising and highlighting these benefits to staff to improve retention rates

Diversity and inclusion

According to NHSBSA’s Diversity and Inclusion Annual Report 2021, women account for 59.28% of its workforce, a decrease of 0.24% from 2019 to 2020. 4.2% of staff identify as LGBTQ+ (an increase of 0.53% from the previous year), while 5.6% of its workforce identify as disabled (an increase of 0.12% from the previous year). Ethnic minority groups account for 9.09% of NHSBSA’s workforce, which continues to be lower than of the English and Welsh population of 14%.

NHSBSA has taken several actions to increase awareness and understanding of diversity and inclusion issues among staff and their wider leadership community. NHSBSA launched its Lived Experience Networks gradually over a period of years. Its Lived Experience Networks are valued by staff and are known to offer support to their members and to incorporate employee views into organisational policy. The Lived Experience Networks focus on underrepresented groups within the leadership community in NHSBSA - ethnic minority, disability and neurodiversity, LGBTQ+ and women. These networks already have 137 active members. They bring together colleagues of all levels from across the organisation who associate and or have an association with the relevant lived experience. The networks aim to help to identify any barriers or issues affecting those relevant groups so that NHSBSA can create a truly inclusive organisation.

In August 2021, NHSBSA retained its ‘Gold Standard Employer’ status in the Employers Network for Equality and Inclusion (ENEI) Talent Inclusion and Diversity Evaluation benchmark for the 4th year. However, it continues to develop various new initiatives to promote diversity and inclusion in the workplace, including creating a new wellbeing and inclusion remote offer for staff. This has been highlighted and publicised by the Chartered Institute of Personnel and Development and the ENEI as best practices. In addition, NHSBSA has launched the shadow board initiative, which is a development opportunity for senior managers who aspire to director-level positions. NHSBSA has also developed a Race Inclusion Plan in partnership with its ‘BAME Network’ focusing on increasing diversity within recruitment, building leadership capability on race, and improving performance on metrics. Overall, staff feel that the organisational culture is inclusive and that steps are being taken to promote diversity and inclusion.

The review recognises that NHSBSA is conscious of the broader issues of diversity and is keen to continue to work to make the organisation an inclusive workplace. Diversity and inclusion should not be viewed through a wide lens, and the issues that affect different community groups are more nuanced. The review acknowledges that NHSBSA has adopted a multifaceted approach to increase diversity and ensure it has an inclusive environment. However, more targeted efforts should be considered where diversity representation continues to fall below national averages.

Conclusion

The review finds that NHSBSA is a high performing ALB. It performs national services that support the vital running of the NHS system. NHSBSA’s status as a special health authority is therefore the most appropriate. Its delivery model has enabled NHSBSA to stand up numerous services at pace under direction of the Secretary of State, in particular during the COVID-19 pandemic, to support the public and wider system. This has been beneficial to the department - no other delivery model would generate more benefits than the existing model.

There are good accountability arrangements in place along with clear and effective sponsorship between the department and NHSBSA. The transparency and openness between the sponsor team and NHSBSA, in particular, has played a crucial role in ensuring that there is an effective working relationship.

The review considers that there is a good working relationship with policy teams, with many policy customers praising NHSBSA for its ‘can do’ attitude and collaborative approach to policy development. Where there have been issues in operationalising policy, there has been positive engagement between policy teams and NHSBSA to ensure service delivery is not impacted. However, the review has identified that there is further opportunity to develop the relationship between NHSBSA and NHSE. Both bodies are keen to improve their strategic workings to ensure optimum service delivery for the public. This is a strategic priority that should be worked on in the long term, given the challenges NHSE faces in the short-to-medium term.

The review further determines that NHSBSA has a good governance structure. The board has appropriate governance of NHSBSA, with relevant committees that report to the board across its areas of responsibility. Its leadership team is particularly strong, given the balance of private and public sector experience, a wide spread of expertise, and homegrown talent. The leadership team has heavily invested in its staff and has introduced a range of initiatives to develop staff and enable them to work through the ranks. However, the review finds that the lack of ethnic and disability representation in leadership and board posts is an identifiable area of improvement which NHSBSA should continue to work to address.

The review determines that NHSBSA is an efficient body and has a good track record on efficiency. Since its formation in 2006, NHSBSA has consistently improved its efficiency, with an annual rate of 2.7% per year, and 1.15% per year since 2015. The organisation is projecting further efficiency savings over the Spending Review period totalling 5% over a 3-year period on RDEL. The pandemic has understandably hampered NHSBSA’s ability to generate greater business efficiencies over recent years. The review notes that there is therefore potential for NHSBSA to generate greater business efficiencies with the return to BAU activity more generally across the sector. The review estimates that there is the potential for a further 5% RDEL efficiency gains over the next 3 years, subject to the department changing its stance on a number of key issues and NHSBSA giving further focus to BAU efficiencies.

It is clear that a key strength of NHSBSA is its ability to generate system efficiencies. NHSBSA led and delivered the success of the Pacific Programme, which, using data insights, helped to identify and deliver a range of initiatives. These initiatives generated more than £1 billion for reinvestment into NHS services. While much of the approach used in the Pacific Programme has been embedded into NHSBSA’s processes, further system savings of almost £300 million annually are forecast for the period 2022 to 2026.

There is potential for NHSBSA to play an instrumental role in generating even greater system savings under a national efficiency programme, subject to departmental agreement. This includes optimising RTEC, expanding the provider assurance function in counter fraud activities, and transforming new services and capitalising on data insights to improve user experience and health outcomes. These opportunities should be explored in detail to ensure that NHSBSA is able to deliver wider governmental objectives.

NHSBSA has the capabilities to unlock further business and system efficiencies. However, a potential constraint on NHSBSA’s continued success could be senior management capacity. Given the size of the potential system-wide efficiencies and the transformation of additional services that NHSBSA may be asked to undertake, the right balance between management focus on business efficiencies and the achievement of system-wide efficiencies would need to be struck. To the extent that there is a trade-off, the review finds that the potential size of system-wide efficiencies should mean that these should take priority over internal business efficiencies.

The review concludes that NHSBSA has an effective delivery model with strong capabilities. Its contact centre is a key organisational strength, which it has demonstrated during the COVID-19 pandemic. However, it should be noted that high attrition in the contact centre is a cause for concern and has had an impact on customer service experience. NHSBSA’s contact centre performance does need to be addressed to ensure that customer service is at a high level. NHSBSA has plans in place to improve end user experience, which it is working to implement. Given NHSBSA’s ability to utilise and deploy its contact centre resource during the COVID-19 pandemic and Grenfell Tower fire, there is potential for NHSBSA to be a ‘contact centre hub’ when rapid response is required. This should be appropriately assessed through a scoping exercise to determine the suitability to provide this shared service more widely.

The review considers there to be an opportunity for NHSBSA to extend its shared services to other ALBs, which would align with the government’s wider strategy for shared services, potentially generating cost savings. This would require a scoping exercise to determine the benefits to all organisations. Additionally, NHSBSA has demonstrated primary care transactional capabilities at a national scale and the review concludes that there should also be further cost benefit analysis undertaken to explore the merits of NHSBSA holding all primary care service contracts.

Lastly, the review notes that due to the current economic climate, recruitment and retention more generally is expected to become challenging due to sector constraints on pay. It is therefore of great importance that NHSBSA continues to create a strong workplace culture that employees value and thrive in, by championing staff progression, employee welfare and diversity and inclusion.

1. On average, over 1 billion prescription items processed and 70 million items scanned. 100% of dental claim forms are submitted electronically and £2.6 billion is paid per year to dental contractors. ↩

2. In awarding a Gold Award at a recent CCA Global assessment, the assessor confirmed: “The NHSBSA contact centre is a well organised, effectively managed centre, with impressive leadership” and “a collective commitment to the delivery of great customer service and strong performance.” (The NHSBSA Seventh Edition CCA Global Standard Assessment Report, December 2021 and CCA GS Certificate - NHSBSA) ↩

3. Mostly prescription services. Also PPC, Matex, Medex, Low Income, Student Services. ↩

4. Mostly pension services. Also dental, technology. ↩

5. Mix of COVID-19, ESR, Exemption checking, NHS Jobs, Overseas healthcare, Provider management, Other. Exemption checking grew quickly from about 100 to 300 between 2015 to 2016 and 2019 to 2020 then has dropped to 100 in 2021 to 2022. Provider management has increased year on year from about 10 in 2015 to 2016 to about 150 WTEs in 2021 to 2022. ↩

6. These figures have been reviewed by the Government Internal Audit Agency and have been agreed with NHSBSA on where the efficiencies arise. ↩