The Public Accounts Committee hearing into the NHS National Programme for IT yesterday heard that the £12.4bn programme is largely on track, apart from its central component, the NHS Care Records Service, which is intended to deliver rich local clinical systems and a national database of summary records.

Just 12 acute trusts have so far received the patient administration systems that are meant to provide the first building blocks of detailed local care record systems. No trusts have yet received more complex integrated clinical systems – the local component of CRS.

Committee chairman Edward Leigh, said: “There are 170 acute trusts and the system has just been deployed into 12, CRS is not in yet.”

Richard Granger, director of NHS Connecting for Health the agency delivering NPfIT, described the question as “a highly selective marshalling of facts”.

Leigh added: “CRS is central. There are 170 hospitals and my clinical record won’t be deployed into any hospital yet, right or wrong?” In response Granger stressed that almost 10,000 deployments had occurred both in infrastructure upgrades and systems ranging from Choose and Book upgrades, patient administration systems and GP systems.

He singled out the NHS spine, which now holds 72m demographic records and the 33 Picture Archiving and Communications deployments to date as particularly significant achievements.

Sir Ian Carruthers, acting chief executive of the NHS, however, acknowledged that CRS remains central and has been delayed due to the complexity of the system, risks involved and need to carry clinical support. “We want a system that works and not one put in quickly for its own sake,” said Sir Ian.

Asked by committee member and Labour MP, Austin Mitchell, whether the programme was trying to do too much, Sir Ian replied: “Apart from the Care Record everything is going right. We are where we are.”

Professor Peter Hutton, the former clinical lead of the project told the committee: "The core of the project is CRS."

He added: “I’ve not been in the programme for two years but my understanding is that the systems have not been added.” Professor Hutton said that the systems delivered to date “have nothing to do with the NHS Care Record”.

Chris Shapcott, who led the National Audit Office (NAO) investigation of the national programme told the committee: “There are some systems in hospitals that are working, but the core clinical system has some time to go.”

Questioned on the two-year delay to CRS reported by the NAO, Sir Ian claimed the delay to the summary spine record had been a deliberate Department of Health decision taken in light of supplier difficulties and the desirability of securing clinical buy-in.

Asked to provide the committee with a copy of the original delivery schedule for the various modules of the LSP (local service provider) strategic CRS solutions, Granger told the committee he would see if the LSPs would be willing for him to provide the information.

Granger said: “It is a very ambitious programme. We are trying to do a lot of work very quickly to catch up with 20 years of under-investment.” Mitchell observed the PAC had often found attempts at great leaps forward had an unhappy track record.

Asked whether CRS would be fully implemented by the DH’s 2010 target Granger said: “I’m confident that a huge percentage of the programme will be in place.” He declined to give a commitment that CRS would be 100% implemented. “We are on track for the deadlines of the programme.”

He later acknowledged, though, that delays to the local detailed CRS systems to be delivered by LSPs had created additional costs to trusts. “A number of existing trusts have had to extend existing systems. I don’t have an exact number but in many cases we are providing financial support to update existing systems.”

Several members of the committee went out of their way to praise the procurement approach taken by CfH and Sir John Bourn, head of the NAO, said that the contracts were based on payments by results delivered.

Questioning from committee member and Conservative MP Richard Bacon revealed, however, that in certain circumstances CfH would make advanced payments. “I said we would only make an advanced payment when covered by a letter of credit from a bank,” said Granger.

Questioned about the clinical risks associated with programme, CfH director of clinical knowledge, process and safety, Sir Muir Gray, said: “Everything is a balance of risk but once this is in it will radically reduce risks.”

One of the key areas focused on by the committee was the escalation in reported costs of the programme to a total figure of £12.4bn reported by the NAO and the total NHS IT spend of £20bn recently given by health minister, Lord Warner. Several members also questioned the lack of costed benefits of the programme.

Unable to get a figure on how much Treasury funding had been irrevocably committed, Richard Bacon MP said: “Mr. Granger, we have been told that this programme is going to cost £2.3 billion; we have been told that it is going to cost £6.2 billion; we have been told that it is going to cost £6.8 billion; we have been told that it is going to cost £12.4 billion or £12.6 billion. Lord Warner, the Minister, said only three weeks ago on 30 May that it was going to cost £20 billion, and you still cannot tell this Committee how much has actually been committed .”

Both Granger and CfH director of service implementation, Richard Jeavons, said that the total local implementation costs of the programme looked to be lower than the £3.4bn originally projected. Granger said that about £1.5bn had been spent so far but this was £650m lower than projected due to late delivery by suppliers.

Sir Ian stressed that the programme had two main components; procurement, which was being managed nationally, to which about £9bn had been committed, and implementation, which was the responsibility of local trusts. Sir Ian announced that from 1 July new arrangements will be put in place within each health authority to oversee local implementation.

Sir Ian said he did not know why implementation had not previously been included in the department’s Public Service Agreement (PSA) agreements with the Treasury.

Leigh said that he had been told that CfH had fought the NAO over its report “street by street and block by block”.

“I don’t see it as a battle,” said Sir John Bourn, head of the NAO. He added that robust debate with CfH, the examined body, was a natural part of the process. “Of course one side argued with the other.”

Greg Clarke, committee member and Conservative MP, said of the NAO report. “I’ve read 62 NAO reports over the past year and this is easily the most gushing.”

Sir John told the committee he was “happy” with the report and said the area examined was complex. He said the report was “perhaps the biggest study we’ve ever done.”

Dr Anthony Nowlan, a former director of the now defunct NHS Information Authority who was seconded to the national programme team in its early days, said that the urgency to procure had “trumped all other considerations”.

The NAO report praised CfH for negotiating tough contracts that shift completion risks onto suppliers. In light of Accenture’s provision for £450m in losses and the financial melt down at iSoft, the committee asked whether the suppliers had the staying power needed to deliver.

“Is the network of suppliers resilient enough to take the pressure you are applying?” asked Clarke. “It is a situation we are concerned about,” Granger replied, adding that it was better suppliers felt this pressure than the NHS.

Asked what happens if iSoft goes bust, he said: “The prime contractors will either have to put money or resources in… I suspect the capital markets will step in to take advantage of that opportunity.”

Granger acknowledged that any further changes in suppliers would inevitably lead to delays, pointing to the situation in the North-west and West Midlands where the replacement of PACS supplier ComMedica added 8-10 months of delay.

Liberal Democrat health spokesperson and member of the committee, John Pugh, said after the hearing: “While the NHS IT system remains over budget and behind schedule, it is impossible to judge whether that money has been well spent.”

He added: “Hard-pressed health trusts are most likely to foot the bill for any unexpected cost overruns.”


A recording of the hearing can be accessed on Parliament Live TV until 7 July under the "Committees" section of the website