I have no doubt the NHS badly manages absence, it always has done, whilst I also have no doubts that absence costs are higher than they need be, what I do doubt is their ability to save that amount of money no matter how good the management suddenly becomes.
Let us assume an average days cost in the NHS is £80, many of those on low pay will be the ones more prone to absence and so the actual cost might be too high but is unlikely to be too low.
Therefore divide £0.55 billion by £80 = 6.875 miliion days. Assuming a normal working week and 4 weeks holiday there are 228 days available for work; therefore by dividing 6.875 million days by 228 we see that there will be 30,150 employees surplus to requirements.
However I understand that the NHS spends "a fortune on temps" and another fortune on outsourced employees. I don't know what a fortune in NHS terms looks like but I assume it is not £0.55bn. Whatever the number I find it hard to believe that every employee is covered by a temp on every day they are absent, if they are then I will question the NHS managers' ability to manage from a different perspective!
If we are generous and assume £0.25 billion is spent on temps and outsourcing that means we need to eliminate 16,447 jobs (slightly less than half the original number). Now I don't believe either Government or unions are likely to get rid of that number of jobs, which is why I say the wasted costs are probably true but achieving the same amount of savings are cloud cuckoo land!
In practice with all these extra hands at work rather than off sick, productivity will go up, which in NHS terms means more patients can be treated. However when more patients are treated don't costs go up?
Ahh you say we recycle money these days, however, whether the money is spent on more patient care, or recycled, the fact is the NHS physically can not save £0.55bn without reducing head count.
Hands up all those who believe that will happen?
Dudley Lusted is head of corporate healthcare development at AXA PPP Healthcare
