1. Equity and excellence: Liberating the NHS

2. Background Published in July 2010, the White Paper ‘Equity and Excellence: Liberating the NHS’ outlined our vision to make the NHS a truly world class healthcare service that puts patients at its heart and clinicians in the driving seat, focused on outcomes. The response sets out the policy for reform in detail in the light of three months of consultation and reaffirms the Government's commitment to the reforms.

3. Thank you The Government is very grateful to everyone who contributed to the consultations. The richness and diversity of responses has provided valuable perspective on how the White Paper was received locally, highlighting the areas where there was most enthusiasm as well as the issues that raised greatest concern. As a result of the consultations, there are several key areas where we have altered our approach to create flexibility, empower local leaders and support the significant cultural change that respondents told us is necessary.

4. Liberating the NHS Legislative framework and next steps

5. allow a longer and more phased transition period for completing our reforms to providers: for example, retaining some of Monitor’s current controls over foundation trusts while the new system of economic regulation is introduced. significantly strengthen the role of health and wellbeing boards in local authorities, and enhance joint working arrangements through a new responsibility to develop a “joint health and wellbeing strategy” spanning the NHS, social care, public health and potentially other local services. create a clearer, more phased approach to the introduction of GP commissioning, by setting up a programme of GP consortia pathfinders. extend councils’ formal scrutiny powers to cover all NHS-funded services, and give local authorities greater freedom in how these powers are exercised. As a result of consultation, we will now:

6. 2011/12 will be the year we create the right environment for the new system to succeed. We will establish the building blocks to enable the NHS to respond to the White Paper. –An NHS Commissioning Board will be created in shadow form during 2011/12. –PCTs will support the development of GP consortia. –During 2011/12, SHAs will need to support every NHS trust to become a Foundation Trust within the next three years. Enabling a smooth transition

7. Quality, innovation, productivity, and prevention (QIPP) This programme of reform supports the NHS in realising its core purpose – to improve quality and outcomes, and to deliver the efficiency and improvement needed to release up to £20 billion to support front line services. We must use the opportunities provided by the reforms to design a genuinely new system that helps us achieve QIPP.

8. The Operating Framework Responding positively to reform

9. This year’s Operating Framework sets out what needs to happen over a transition year that requires all parts of the health service to work across organisational boundaries to respond positively to the reform set out in Equity and excellence, whilst ensuring that service quality and financial performance are maintained and improved at a time of change. We need to maintain a clear focus on quality and safety during the transition to ensure the new system inherits a healthy finance and performance position. Therefore, although the long term direction of travel is towards greater autonomy for the NHS, we need to strengthen some controls during 2011/12 to go into 2012/13 with confidence. A transition year

10. Strengthening controls Close monitoring of progress against QIPP Key Performance Indicators and financial performance as well as a need to go further on improvements that contribute to quality and efficiency gains. Maintenance of improvements to date – the NHS has worked hard in previous years to deliver improvements in quality and access – these need to be sustained through the transition; and Specific improvements in relation to Government priorities – where additional funding has been secured as part of the Spending Review, for example more health visitors.

11. PCT allocations Supporting frontline services

12. Increased funding for frontline services The Government has protected health spending and PCTs will see a 3% increase in PCT revenue allocations (£2.6billion) over the next year. NHS growth will be passed on to frontline services, as PCTs will receive £89bn to spend on health locally in 2011/12. The allocations include £150million to be spent on reablement and an additional £648million to spend on social care services to benefit health and to improve overall health gain.

13. Ensuring capacity and capability 2011/12 is the first full year of the transition to the new system and will require initial changes to be made across all parts of the service. Shadow organisations will be set up to mirror the functions of the NHS Commissioning Board, GP consortia and the health and wellbeing boards. PCT clusters will be formed to ensure that the system maintains a stable structure throughout the transition. Working together will better enable PCTs to do so. The Operating Framework for 2011/12 provides further detail on the shift to sub-regional clusters.

14. The scale and pace of change Testing the new system

15. We recognise the scale of the challenge. However, we are committed to ensuring the new system is tested – and our proposals will ensure that this happens; –The pathfinder consortia give us the opportunity to test out design concepts and explore functions at an early stage so that any barriers to success can be overcome quickly. –Similarly, we are encouraging local authorities to identify early implementers to aid the developing health and wellbeing boards. –We are also inviting local authorities to develop pathfinder HealthWatch organisations.

16. Next steps Existing and upcoming consultations

17. Where to go for more information For more information on the government’s response to the White Paper, the Operating Framework 2011/12, and PCT allocations for 2011/12 visit the Department’s website at www.dh.gov.uk. www.dh.gov.uk We will also publish shortly an Outcomes Framework for the NHS, which has been informed by the consultation over the summer. In addition, a consultation on Workforce Planning, Education and Training will be published shortly.

18. We want to hear from you In addition to today’s publications, we are still seeking views on a number of consultations that we have launched recently. The consultations on Public Health, Choice & Information are all available for response at http://www.dh.gov.uk/en/Aboutus/Features/DH_122364, and we are keen to hear your thoughts. http://www.dh.gov.uk/en/Aboutus/Features/DH_122364 We will continue to engage with you over the next year to ensure a smooth transition to the new system