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Steering the NHS through financial crisis

26th November 2008

Paul Stanton, visiting professor in the School of Health, Education and Community Studies at Northumbria University and chief executive of Southminster Consultancy Associates, considers the impact of the global financial crisis on the NHS in the Health Service Journal.

globalhealthcareQThe impact of the "credit crunch" and the resulting problems has had an impact on a worldwide level.

NHS managers need to pay attention to the idea that they should "think global, act local".

All organisations in the public sector will be affected by the government's reaction to the financial situation.

Most will be squeezed by having to carry on with "shrinking resources" as the government reconsiders the funding it gives the public sector.

The global recession will fuel unemployment and this will affect many families. Health services will have to deal with the fallout "as the mental and physical stresses and strains begin to bite."

Well-prepared health service organisations will "already" be making plans for "reduced resources and increased demand".

The key to the crisis is the "profound and almost universal failure of governance in the boardrooms of financial institutions. In an unregulated and unenlightened dash for cash, boards have lost a grip on the underlying fundamentals of their business."

The global financial crisis and the problems it will cause health service organisations should act as a strong incentive for them to "align the approaches to system regulation".

Regulations which are imposed for the sake of ticking boxes or achieving targets "throttle" truly effective care.

In these uncertain times it will do us all good to be aware that governance - or "the application of wisdom to uncertainty" - should be put ahead of meaningless regulations.


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