NHS facing massive cost overrun for IT system

By Matt Whipp

Posted on 12 Oct 2004 at 13:32

A mammoth IT system for the NHS is expected to cost billions more than expected, possibly eating into funds needed for front-line local health services, according to reports.

The system, which will enable patients to book hospital appointments at times and places that suit them and give health staff access to patient records wherever they are, was originally billed at ï2.3bn over three years. This is now expected to be nearer ï6.2bn over 10 years.

But business IT magazine Computer Weekly says that at a recent high-level meeting the cost of actually implementing the system could be anything between five and eight times the cost of buying the equipment. And the Department of Health has since admitted the final bill will add 'some three to five times the cost of procurements.'

The Department said that despite the escalating costs, the system will still offer even greater efficiencies, benefits and savings.

Health minister John Hutton said on Radio 4's Today program this morning that the costs have been factored in to the annual ï1bn budget already allocated to IT for the NHS and dismissed the enormous cost projections as 'speculation'.

However, the National Audit Office (NAO) is to investigate the IT program and plans to report on how well the system was chosen and whether it is value for money by next year.

Politicians have latched on to the furore to point out the potential draw on resources from front line services that the IT system might make.

Liberal Democrat Shadow Chancellor Vince Cable told Computer Weekly: 'Local health trusts will be forced to make very difficult decisions to support the national programme with local funding. This could mean cuts in other frontline services if the project is to be delivered. The future success of the NHS depends on this project.'

They also welcomed the investigation by the NAO to highlight whether or not such large amounts of money have been spent wisely.