NHS needs to do more to leverage spending power

In 2016, the Carter report identified the scope for efficiencies through greater collaboration which would allow the NHS to aggregate its purchasing power, thus securing the best price. In 2017-18, the Department of Health & Social Care (DHSC) implemented a new operating model and delivery body for NHS procurement known as NHS Supply Chain (to replace the previous, fully outsourced model which was also called NHS Supply Chain). The new body was responsible for procuring products, warehousing, and delivering goods on behalf of the NHS.

The UK's independent public spending watchdog recently examined how effectively NHS Supply Chain is making efficiencies across NHS procurement, and whether it has achieved its objectives of saving money and increasing its share of products (medical equipment and consumables) bought through it by the NHS.

Responsibility for Supply Chain moved to NHS England (NHSE) in 2021. For 2023-24, NHS Supply Chain estimates that annual NHS spending on products is around £8 billion. At its inception in 2019, DHSC set NHS Supply Chain a target to deliver £2.4 billion savings by 2023-24. As of 2022-23, it told the NAO that it had exceeded its £2.4 billion savings target. Although NHS Supply Chain reported progress against this target to NHSE on a quarterly basis, neither NHSE nor the DHSC has validated or checked these savings.