Sixth report from the Select Committee on Estimates : together with the minutes of evidence taken before sub-committee D and appendices, session 1956-1957: Running costs of hospitals.
- Great Britain. Parliament. House of Commons. Select Committee on Estimates
- Date:
- [1957]
Licence: Public Domain Mark
Credit: Sixth report from the Select Committee on Estimates : together with the minutes of evidence taken before sub-committee D and appendices, session 1956-1957: Running costs of hospitals. Source: Wellcome Collection.
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![29 January, 1957.] [Continued. 39. Certain headings of expenditure relate to both patients and staff and costs expressed in terms of patient-weeks may therefore be misleading. Under the present subjective analysis it is not possible to correct generally for this factor but in the case of provisions an attempt has been made to do so by including a separate column showing the average weekly cost of provisions per person fed, based on the numbers of both patients and staff fed. 40. Appendix 1, Table —*, shows the detailed national average costs for the main types of hospital for the year 1955-56, as shown in the published Costing Returns for that year ; and Tables 14 and 157 the national average inpatient costs for the main types of hospital for each of the years from 1950-51 to 1955-56. These latter Tables show in addition the estimated inpatient costs for 1953-54 for each type of hospital in terms of wage and price levels obtaining in 1950-51 and the estimated inpatient costs for 1955-56 in terms of wage and price levels obtaining in 1954-55. It is not possible to make comparisons of this kind between costs in 1955-56 and costs in 1950-51 because of the changes which took place at the beginning of 1954-55 in the definitions of hospital types for classification purposes. 41. Notwithstanding the limitations of the present costing scheme, the Minister has taken the view that the published returns can give useful pointers to differences in cost which ought to be investigated by the hospital authorities and so help to promote economy and efficiency. Arrangements have now been made for the introduction, with effect from 1957-58, of a more informative costing system. This will be based on the Report of a Working Party on Hospital Costing, published in 1955, which recommended the introduction, by stages, of a full departmental and unit costing system, which would show not only on what items expenditure was being incurred but also to what extent the different departments were contri- buting to that expenditure. Outpatient expenditure will, under this system, be separately calculated for the first time. Initially the main scheme is to be operated in some 200 hospitals—principally acute or mainly acute—with an annual expendi- ture of £150,000 or more. Other hospitals will operate a simpler scheme which is in essentials an improved version of the existing system. They will produce unit costs for certain departments based on the principal direct expenses (e.g., salaries and materials) of those departments and no attempt will be made to bring in overhead costs, on a departmental basis. The first figures to be published nationally under the new system, and showing comparisons between the costs at different hospitals, will not be available before the latter part of 1958. But hospital authorities have been asked themselves to get out interim cost statements at frequent intervals during the year for purposes of internal management. Great importance is attached to the prompt production of these interim statements and to the follow up action which should be taken locally when the statements reveal anomalies in costs. Both the Committee of Public Accounts and the Guillebaud Committee have expressed themselves in favour of the introduction of the new system. The Guillebaud Committee 42. Reference has been made to certain of the recommendations of the Guillebaud Committee (see paragraphs 27 and 41). This Committee was appointed in May, 1953, by the Minister of Health and the Secretary of State for Scotland, with the following terms of reference :— “To review the present and prospective cost of the National Health Service ; to suggest means, whether by modifications in organisation or otherwise, of ensuring the most effective control and efficient use of such Exchequer funds as may be made available; to advise how, in view of the burdens on the Exchequer, a rising charge upon it can be avoided while providing for the maintenance of an adequate Service; and to make recommendations ”. The Committee made no recommendations for major changes of policy or administration but made a number of detailed recommendations, including those mentioned. * Not reported. + App. 1. pp. 374-5.](https://iiif.wellcomecollection.org/image/b32182466_0032.jp2/full/800%2C/0/default.jpg)
