Bacon says ‘prove value of NPfIT deals’

A leading member of the Commons Public Accounts Committee has written to NHS chief information officer Christine Connelly, questioning how negotiations to ‘descope’ the two remaining local service provider contracts will deliver value for money.

In an interview with E-Health Insider, Richard Bacon said it was essential that civil servants leading the contract renegotiations were clear that the deals would deliver clear value for money and provide the NHS with working systems.

“If senior civil servants don’t like what they are being asked to do, or don’t think they can justify them on strict value for money criteria, then Treasury guidance makes clear that they should write to the minister and say ‘I can’t justify on a value for money basis and require a ministerial direction’.”

Two new, cut down local service provider deals – that dramatically cut the amount of functionality and slash the number of hospitals to get new systems – are thought to be on the brink of being signed.

Both involve up-front payments to remaining LSPs, BT and CSC. The new CSC deal hinges on a successful go-live of Lorenzo at University Hospitals of Morecambe Bay NHS Trust.

Bacon is concerned that the new LSP deals will fail to deliver systems urgently needed by NHS hospitals. “I remain very concerned about the acute hospital care record systems that are at the heart of the national programme,” he said.

“I think you would agree that the progress of acute care record systems within the national programme has been very disappointing. I am extremely concerned that the latest contract resets will take us out of the frying pan into the fire.”

Bacon’s letter to Connelly has been copied to NHS chief executive Sir David Nicholson and the Comptroller and Auditor General at the National Audit Office, Amyas Morse.

In it, Bacon asks how the current talks to scale back the programme and save £600m – which are likely to mean cutting two of the four planned Lorenzo releases and slashing the number of trusts to get Lorenzo and Cerner Millennium – represent value for money for the taxpayer.

E-Health Insider has learned that up to 18 London hospitals trusts are thought to have withdrawn from the LSP upgrade programme, out of an original total of 32. Seven of these are existing iSoft sites.

Bacon, the Conservative MP for South Norfolk, asks Connelly: “How can the programme represent value for money when such dramatic reductions in scope and scale are apparently being considered?”

Turning to the South, Bacon also asks Connelly about the value for money of BT being paid an additional £546m for installing four new Cerner systems, maintaining seven Cerner systems already installed and deploying some RiO mental health systems.

“This seems like an extraordinarily large amount of money for such a small amount of activity,” his letter says. “How this has been calculated as being value for money when the eleven acute trusts could have purchased brand new systems for a fraction of the price?”

The latest date for a go-live at Morecambe Bay of Lorenzo Regional Care Release 1.9 appears to be 2 April. However, Bacon points out that: “Over the last seven years, the Lorenzo PAS [patient administration system] has missed deadline after deadline.

“We were expecting it in 2004-05; and then in 2008 Mr Nicholson told us that it was ready to deploy; and I understand that it is about to miss the March 2010 drop dead date which you set last year.”

Bacon told EHI that he his current information was that over 100 bugs still exist with Lorenzo at Morecambe Bay, indicating the software is not ready. “I understand that there are over 100 unresolved issues, but we know from previous sites what the consequences are of going live with software that isn’t ready.”

In his letter Bacon tells Connelly: “Finally, although I appreciate the huge political pressure to deploy systems to demonstrate progress, I am also concerned about deploying Lorenzo before it is ready to use. I would hate to see another problem like Barts and the London, the Royal Free or Milton Keynes.

“How are you ensuring that the Morecambe Bay system is ready and that trusts further down the line will not be allowed to go live until the deployment is proven at Morecambe Bay?”

Bacon also asks: “How much is the NHS spending in supporting Lorenzo? How many Lorenzo acute PAS systems are being targeted for the next 12 months?

And, pointedly, he asks Connelly at what point will she call time on Lorenzo: “At what point will you say “enough is enough” if CSC fail to deploy the Lorenzo PAS successfully?”

Speaking to EHI, Bacon said: “Civil servants in this have to be careful to ensure they fulfil their responsibilities for safeguarding public money. If they are taking decisions without evidence of value for money, they should know they are being watched.”

He added: “If they have any doubts, Treasury guidance is very clear that they should write to their minister and seek a ministerial direction. The NAO and PAC are made aware when such a letter is written.”

Bacon pointed out that the device of a ministerial direction is alive and well. In February, Peter Housden, the permanent secretary at the Department of Communities and Local Government, wrote to his minister, John Denham, seeking a written instruction over decision on unitary authority proposals for Devon, Norfolk and Suffolk, which he believed failed to meet value for money criteria.