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IT costs snap up quarter of NHS budget

Nick Heath silicon.com

Published: 10 Jun 2008 08:25 BST

The cost of upgrading NHS IT systems is now gobbling up a quarter of the health service's budget for major projects.

NHS spending on IT has shot up from nine percent of total annual capital expenditure in 2003/04 to 25 percent in 2006/07.

The spending spike coincides with the launch, in 2002, of the £12.4bn National Programme for IT (NPfIT) to revamp NHS IT systems.

The public spending lobby group the Taxpayer's Alliance described the hike as "staggering" and accused the NHS of dealing with "error after error" in the system by trying "to buy their way out of trouble using taxpayers' money".

The cost of the NPfIT is already more than double that of the original £6.2bn estimate, with contractors such as Fujitsu and Accenture walking away from delivering the project amid commercial concerns.

Chief executive of the TaxPayers' Alliance Matthew Elliott said: "The staggering cost of NHS IT is a massive drain on resources that are meant to be spent on healing the sick but instead end up channelled into the pockets of technology contractors.

"The system is too centralised, lacking in accountability and run increasingly by people who have too little experience and too many responsibilities."

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But government health minister Ben Bradshaw told Parliament in a written answer that upgrading the national IT infrastructure was the most cost-effective option.

He said in a statement: "The department has not made an estimate of expenditure on NHS IT in the absence of a national programme but an independent review confirmed that the likely costs of each NHS trust undertaking procurements for IT solutions would cost £4.5bn or more."

The NHS's spend on operational IT running costs has grown at a far slower rate than the capital outlay, increasing from two percent in 2002/03 to 2.7 percent in 2006/07.

The NPfIT in the NHS is tasked with replacing an ageing patchwork of 5,000 different computer systems with a nationwide infrastructure connecting more than 100,000 doctors, 380,000 nurses and 50,000 other health professionals.