Overhaul of NHS follows death rates scandal

Sir John Arbuthnott, the health chief who carried out the last major review of funding, told Scotland on Sunday that a wholesale review of the way Scotland’s health boards are funded will be undertaken in 2005.

He said his own plan was now out of date, and insisted there was a need not only to reform it but to study European models with a view to improving Scotland’s performance.

"It would not surprise me in the least if the successor to my committee began to ask questions on, for example, are there any factors and other ways in which we could look at funding allocations?" he said. "I’m sure that there will be new approaches coming to the fore and that is very healthy."

Arbuthnott’s comments come in the wake of a new independent report, which concludes that the massive public investment in the country’s hospitals in recent years has failed to improve the system.

The report - by think-tank Civitas - claims that instead of increased cash, structural reforms are needed, politicians should be removed from play, and new European-style social insurance plans should be brought in.

The shortfalls within the current system were rammed home last week by damning new figures which found that the NHS had allowed growing inequalities in health to develop.

Men living in the poorest areas of Glasgow are now expected to die before they reach retirement age, a situation described by First Minister Jack McConnell as "unacceptable".

Health chiefs are now to re-visit Arbuthnott’s findings, providing a new formula of funding allocation across Scotland. They are also expected to examine whether other innovative funding solutions can be introduced.

In England, ministers are bringing in Foundation Hospitals, which are largely autonomous from health board control, and are handing out a greater share of funds to local service providers.

The planned reforms for Scotland are deemed necessary by many health experts because of the apparent failure of Scotland’s generous funding to

make a difference on the nation’s health.

The Civitas report, commissioned by the David Hume Institute, found that Scotland spends the European average per head of population on health care, at 1,347 a year. That is far more than the English average of 1,132.

The money means that there are more doctors, dentists, nurses, GPs and midwives in Scotland per head of population than in England - but the extra cash has failed to greatly improve health here.

The Civitas report found that Scotland had the highest levels of heart disease, lung cancer and oesophageal cancer across 17 western European nations.

In comparison with England, Scotland had higher rates of heart disease, stroke and cancer, and had a lower life expectancy. One and five-year survival rates from all cancers were also better in England.

Civitas also offered evidence to suggest that the higher level of funding in Scotland boosts the "cost of production". Its figures showed that the number of ‘episodes’ conducted by Scottish consultants was nearly half that of their English compatriots. Meanwhile, the average stay in a Scottish hospital bed was two days longer than that in England.

The report concludes: "Scotland’s increased resources have not given rise to a step change in health outcomes." It adds that, as a result of Scotland’s experience, planned increases in health spending in England should be guarded against.

Scots ministers have been chastened by their own findings on health inequalities. Figures show the average life expectancy of men in the Glasgow region of Shettleston is just 64. In Glasgow Maryhill, 183 people per 100,000 die of heart disease, compared to just 85 in wealthy Edinburgh West.

Another call for reform last night came from Professor Stephen Smith, the dean of medicine at the University of Glasgow. "We really do have to enter this debate with open eyes - one system is not better or worse than the other," he said.

Ben Irvine, author of the Civitas report, said: "It is surprising that, unlike their counterparts in all political parties in England, Scots decision-makers do not appear to have made a concerted effort to learn from foreign healthcare systems."

Irvine’s report claims that social insurance systems in Europe are more likely to ensure that deprived people get better treatment than the system in the UK. Civitas also backed the call to remove political involvement in the NHS.

Scottish Executive officials last night insisted that high levels of deprivation and Scotland’s poor diet should be factored into the equation, but agreed that reforms were needed, along with investment.