PM abolishes NHS England in reforms

The aim was to take the NHS “out of politics” by placing responsibility for its day-to-day running and spending in the hands of an independent arm’s-length body. In reality, it created a tangled bureaucracy and two overlapping and uncoordinated fiefdoms — with many jobs duplicated between NHS England and the Department of Health.

The Labour government has been clear it wants to bring the NHS firmly back into politics, believing the health service — and its £180 billion annual budget — must be under the direct control of ministers to tackle the waiting lists of seven million patients.

There’s a very old joke about an Irish yokel giving directions to a tourist: “Well, I wouldn’t start from here.” It’s so old I hesitate to use it. Except that it also happens to be the best possible description of how you’d reform the NHS.

The public tend to think of the health service as a single, monolithic system. But it’s nothing of the kind. It’s a bewildering hotchpotch of agencies and organisations, mashed together and torn apart by decade after decade of reforms, initiatives and reorganisations, by concessions and compromises so ancient they have formed their own sedimentary layers.

For the past decade, one of those reorganisations has been particularly significant. The Health and Social Care Act — the disastrous fruit of Andrew Lansley’s plan for reform — resulted in a system whereby the NHS in England was run by a giant quango (NHS England), which in turn took direction from the Department of Health and Social Care.

• Read Robert Colvile’s comment in full: A seismic shift in the NHS has just been announced, and no one even noticed

There will be no return to austerity despite pledges to reform the civil service, the prime minister has said.

When asked if abolishing NHS England and the reforms will result in job cuts and spending cuts, Sir Keir Starmer said: “There is no return to austerity. I ran a public service during years of austerity and I saw what was done. Part of problem we got with our public services is what was done a decade or so ago.”

He also spoke of the need to reform welfare, and added: “We must support those who need support but we also must support those who want to get back into work to get back into work and at the moment the system doesn’t do that.

“A welfare system that doesn’t help people get into work because you take the risk of coming off benefits and into work you end up worse than you started so people don’t take that journey.”

In a press release announcing the change, the Department for Health said that Sir James Mackey, the CEO of NHS Improvement, will oversee the transition.

It said that work will begin immediately to return many of NHS England’s current functions to the department and remove “unnecessary admin”.

Wes Streeting, the health secretary, said: “This is the final nail in the coffin of the disastrous 2012 reorganisation, which led to the longest waiting times, lowest patient satisfaction and most expensive NHS in history.

“When money is so tight, we can’t justify such a complex bureaucracy with two organisations doing the same jobs. We need more doers and fewer checkers, which is why I’m devolving resources and responsibilities to the NHS front line.”

Explaining the reasons for the decision, the prime minister said that he wanted more money to go to the front line for patients.

Answering questions from the audience, Sir Keir Starmer said: “Among the reasons is because of the duplication. We have a communications team in NHS England and the health department of government, we have strategy teams in the health department and NHS England.

“If we strip that out that allows us to put the money where it needs to be, the front line. We want to make sure power is pushed them and away from the bureaucracy that holds them up.”

The government is to abolish NHS England in an effort to “cut bureaucracy”.

He said the change would “shift money to the front line” and remove “layers of bureaucracy”.

“I’m bringing management of the NHS back into democratic control by abolishing the arm’s-length NHS England that will put the NHS back at the heart of government where it belongs, freeing it to focus on patients — an NHS refocused on cutting waiting times at your hospitals.”

Sir Keir Starmer has said that “strength abroad” demands “security back at home”.

The prime minister said in his speech in Hull: “More now than ever, national security is economic security and strength abroad, and we definitely need that more than ever at the moment, but that demands security back at home.

“That is the test of our times, the goal of our times. National security for national renewal. The fundamental task of politics right now is to take the tough decisions on security and that’s why we raised our defence spending.”

The prime minister said that he was not questioning the dedication of civil servants, after criticism from union leaders.

“This is not about questioning the dedication or effort of civil servants, it is about the system we have got in place and that system was created by politicians — the buck stops with us,” he said. “Over a number of years politicians have decided to hide behind vast arrays of quangos, arm’s-length bodies, regulators reviews, you name it. A sort of cottage industry of checkers and blockers, using taxpayer money to stop the government dealing on taxpayer priorities.”

He cited his plan to build 1.5 million homes, which he said was being blocked by some agencies. “Some parts of the state haven’t got the memo.”

Dave Penman, the leader of the FDA union, accused Starmer of “denigrating civil servants” by vowing to cut the state’s “flab”.

The prime minister has said the state is the “weakest it’s ever been” as he outlined his plan to change the civil service.

Speaking from the Reckitt office in Hull, Sir Keir Starmer said: “At the moment the state employs more people than we have for decades but look around the country — do you see good value everywhere? I don’t.

“I actually think it’s weaker than its ever been. Overstretched, unfocused, trying to do too much, doing it badly, unable to deliver the security people need.”

He added, however, that “we don’t want a bigger state, a more intrusive state”.

The prime minister was introduced by Angela Naef, the chief R&D officer at Reckitt, which produces brands such as Dettol, Gaviscon and Strepsils.

In his speech Sir Keir Starmer will pledge to slash the cost of regulators, something that could mean many quangos are closed down.

The government has already announced a plan to axe the Payment Systems Regulator (PSR), which will be absorbed by the Financial Conduct Authority. Homes England, the government’s housing agency responsible for accelerating building, is also at risk.

There are an estimated 300 quangos in the UK across a number of different sectors. The latest statistics available showed about 60 per cent of government spending was channelled through them — this amounts to about £353.3 billion in 2022-23.

However, the Conservatives have pointed out that 27 quangos have been set up since Labour came to power including Great British Energy, the publicly owned clean energy company.

Half of all central NHS staff face losing their jobs as the Labour government seizes control of the health service.

Wes Streeting, the health secretary, has ordered NHS England to slash up to 7,000 office-based jobs as part of a plan to shrink central bureaucracy and divert resources to frontline care.

This will give the Department of Health and Social Care greater oversight of the day-to-day running of the health service, with duplicated jobs “eradicated” under the plans.

• Read in full: Office-based staff face the axe at NHS England

A Labour prime minister with a dominant majority and an impatience to do things differently gives a speech demanding radical civil service reform — fewer staff in Whitehall, more specialist and professional skills, breaking down departmental silos and rewarding the best while sacking poor performers.

For Tony Blair in 2004, read Sir Keir Starmer 21 years later. The same complaints go even further back, with the 1968 Fulton report bemoaning over-reliance on specialists, a lack of scientific knowledge and poor personnel management.

The obvious question is why, despite decades of promises of reform, do the same problems persist?

• Read in full: Civil service is now 115,00 people bigger than its pre-Brexit low

Some civil service jobs will be cut as part of efforts to modernise public services, said Peter Kyle.

He pushed back on criticism from Dave Penman, the union leader of the FDA, who accused Sir Keir Starmer of “denigrating civil servants” by vowing to cut the state’s “flab”.

The tech secretary said that plans to digitise and automate processes were vital to achieving efficiencies. Kyle told Sky News: “It is almost certain that the headcount will go down.” However, he stressed: “We’re not going to set an artificial … arbitrary, overall figure.”

After Starmer was accused of criticising the civil service last year, Kyle said: “This is not about the political side of government against the civil service.”

Ministers do not know how much is spent on regulatory compliance — despite Sir Keir Starmer vowing to cut it by 25 per cent.

Kyle was asked on LBC what the prime minister’s pledge “means in cold hard cash”.

The technology secretary admitted: “We don’t know actually. The absolute truth is, we don’t know how much is actually spent on regulatory compliance in our country. We’re trying to actually get to the bottom of that. But once we do, we will reduce it by 25 per cent. Because we do know that there is just too much burden on companies and innovators out there.”

The ambition was set out by No 10 overnight ahead of Starmer’s speech in Yorkshire, which he’s expected to deliver at about 10.30am.

Half of government transactions are “analogue”, said Peter Kyle, the technology secretary, as he discussed plans to digitise public services.

DVLA opened 45,000 envelopes every day while HMRC picks up the phone 100,000 a day, according to the cabinet minister. “This is not the way we should be running our country in the 2020s,” he said.

Kyle relayed the firsthand experience of a civil servant in his department, explaining that when she became pregnant she had a maternity card and had to carry it with her for each check-up. “She was told that if she went into labour and she didn’t have that card, then she wouldn’t be able to have the medical records with her.”

In his speech today Sir Keir Starmer will unveil a series of policies he said will “reshape the state to delivery security for working people”.

He will commit the government to abolishing more quangos, which he said will save 25 per cent on administrative costs. He will also announce new AI and tech teams in public sector departments to drive improvements and efficiency in public services.

As part of this, the prime minister wants one in ten civil servants to working in tech and digital role with 2,000 tech apprenticeships in the public sector.

Starmer said the approach will include greater digitisation and be underpinned by a mantra that: “No person’s substantive time should be spent on a task where digital or AI can do it better.”

The technology secretary has described himself as a “disruptor” with similarities to Elon Musk or Dominic Cummings, but with the added “hard work of delivery”, as he boosted public sector pay to attract AI experts.

Peter Kyle has pledged that one in ten civil servants will have a digital role by 2030. There will be bigger salaries to tempt people from the private sector.

He said the civil service needs to attract top tier talent, adding that a “very senior figure” from OpenAI had joined his department. Kyle said there were those who care “very deeply about public service”.

• Read in full: Peter Kyle pledges one in ten civil servants will have digital role by 2030

The UK will save £100 million by bringing in more skilled and digitally-savvy civil servants over the next five years, the science and technology secretary has said.

Peter Kyle told Times Radio that to do this the civil service will have to pay more, but the new recruits will replace some of the people in the role at present.

WIKTOR SZYMANOWICZ/FUTURE PUBLISHING/GETTY IMAGES

“I am pledging today that we will bring in 25,000 additional skilled, digital-skilled civil servants in over the course of the next five years. Now that will mean replacing some of the skills we have at the moment. But by doing this and in some cases I’m being very honest I’m going to pay more because of the very highly skilled nature of doing so. There’ll be a net saving by doing this of £100 million.”

Reform to the civil service will not necessarily mean fewer staff, the science and technology secretary has said.

Peter Kyle told Times Radio that the changes being announced by the prime minister in a speech today are about driving efficiency to deliver change. He said: “The objective isn’t to cut staff. The objective is actually to drive efficiencies within government itself, to make work more rewarding within the civil service.”

He added: “I think we will be reducing the head count, but the purpose of this is to make a more cost-effective, and efficient and effective, civil service, delivering better services for people in the digital age.”

As of 2024, there were more than 515,000 civil servants employed by the state — a figure that has risen rapidly since 2016 when there was an estimated 380,000 people employed.

Sir Keir Starmer will today lay out plans to reform the “flabby” British state which he says is holding back delivery.

In a speech in Yorkshire, the prime minister will pledge to take on the “cottage industry of checkers and blockers slowing down delivery for working people”.

He will vow to increase the use of artificial intelligence in the public sector to improve productivity, and unveil a new target to reduce the administrative costs across government by 25 per cent.

Writing in The Daily Telegraph, Starmer wrote: “We’re putting Britain back in the driver’s seat with our plan for change. We’re fighting for the British people. We’ll secure our future together.”