New central list for hospital supplies 'to save £500m'

Jeremy Hunt Jeremy Hunt says there is concern within the ageing population as to whether the NHS is going to be "financially viable"

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A new central procurement list for NHS England aimed at ensuring hospitals get the best price for supplies could help save £500m, the government says.

Health Secretary Jeremy Hunt said the "radical" move would ensure every penny of the health budget was spent wisely.

A "procurement tsar" will produce the list - made up of prices negotiated and set between the NHS and suppliers.

But Labour said the government's overhaul of the NHS had wasted millions and these plans would not change that.

Start Quote

I think we have to be confident that we are spending every penny of the £100bn NHS budget wisely”

End Quote Jeremy Hunt Health secretary

The new central procurement list will mean that hundreds of everyday hospital supplies will be bought in bulk to help harness the "buying power" of the health service.

'Spending wisely'

The government has committed to making savings of £1.5bn to £2bn on procurement by the end of 2015/16.

The Department of Health said it expects this NHS core list to make up £500m - roughly a third - of these overall savings.

Hospitals currently negotiate prices for supplies individually and as a result cannot always secure the best prices for products, it said.

Surgical gloves Hospitals could see the price of surgical gloves cut by 38% by switching to an alternative supplier, Mr Hunt says

It claimed the new core procurement list would "drive out variation and secure better prices with our suppliers".

The NHS will centrally negotiate with suppliers, using its scale to "drive a harder bargain" and trusts will then shop for what they need from the list.

The health secretary told BBC 5 Live's Pienaar's Politics show that improving procurement could significantly cut spending.

He used spending on sterile surgical gloves as an example, saying hospitals could save up to 38% on the price they paid for the product if they switched from the market leader to an alternative supplier.

"The reason that we're being even more radical in what we're announcing today is because there is concern within the ageing population as to whether the NHS is going to be financially viable going forward," Mr Hunt said.

"And before we go back to the British people with any request for extra money from taxes or any other sources of finance, I think we have to be confident that we are spending every penny of the £100bn NHS budget wisely."

He also insisted that the reorganisation of the NHS since the coalition took office was achieving savings of £1bn every year.

'Wasting millions'

He said while the process of shaking up the health service may not have been perfect, the principle behind the reforms had been right.

"We removed 20,000 administrative jobs in the old primary care trusts and strategic health authorities, and we're using that to pay for 7,500 more doctors," the health secretary said.

"So we've been taking lots of measures right from the start of the Parliament in order to get more money out of the frontline."

But shadow health minister Jamie Reed said Prime Minister David Cameron's £3bn reorganisation had fragmented the NHS and it had "lost the power to bulk-buy".

"As a result, hospitals are wasting millions that should be spent on patient care," Mr Reed said.

"These plans will not reverse that."

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