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Ask The Experts – NHS Commissioning

Tuesday June 29th, 2010

By Duncan Eaton, PASS Consultant

NHS Commissioning

PASS Consultant Duncan Eaton looks at NHS commissioning and its future.

Q What is the background and purpose of NHS commissioning?

A Commissioning of health care has been an integral part of the English NHS organisational and operational environment since 1990. Its purpose is to secure best value and deliver improvements in health care services to meet the needs of a defined population.

Q Who carries out NHS commissioning?

A The commissioning structure has evolved over the last 20 years, from health authorities to Primary Care Trusts. PCTs currently carry responsibility for the majority of health care commissioning. Some highly specialised services are commissioned by regionally organised teams.

Q Is commissioning another name for procurement or purchasing?

A Not in the NHS context, although a purchasing process is often one of the key elements of activity within the commissioning cycle. For example, a purchasing procedure may not be used if a decision is made to deliver a service in-house or by the award of a grant to a third sector organisation.

Q What are the principles of good commissioning?

  • Understanding the needs of the users and communities to be serviced.
  • Mapping and consulting all major potential provider organisations and companies.
  • Ensuring outcomes are at the heart of the planning process.
  • Ensuring contracts are open, transparent, fair and widely communicated.
  • Delivering value for money over the full cycle of the contract period.
  • Securing benefits for the service user and the wider community.
  • It is fully auditable, accountable and legal.
  • It is well planned and project managed.

Q What are the key stages in a typical commissioning process?

  • Identify need.
  • Evaluate against strategic objectives.
  • Assess the options to meet the need.
  • Identify funding availability and options.
  • Engage and consult stakeholders.
  • Define output and outcomes required.
  • Determine capacity and capability of supply market.
  • Create supplier capacity (if necessary).
  • Determine delivery strategy.
  • Define specification.
  • Initiate procurement process (if appropriate)
  • Contract award.
  • Contract management – including quality monitoring and user satisfaction assessment.

Q What are the competencies required for commissioners?

A The NHS World Class Commissioning initiative has identified 11 organisational competencies required by PCTs in order to carry out effective commissioning.

  1. Act as the local leader of the NHS.
  2. Work collaboratively with community partners, eg local government, health care providers and the third sector.
  3. Engage with the public and patients.
  4. Collaborate with clinicians to inform strategic policies, the design of health care services and effective resource allocation.
  5. Manage knowledge and carry out robust needs assessment of current and future needs and requirements.
  6. Identify and prioritise investment requirements and opportunities respecting the values of the NHS.
  7. Stimulate the market and influence health care provision so that demand is met and outcomes are secured.
  8. Promote and drive continuous improvement in quality and outcomes and the identification of innovation.
  9. Secure procurement skills to deliver robust and viable contracts.
  10. Work in partnership with the  performance management provider to ensure continuous improvement.
  11. Make sound financial investments to ensure sustainable development and value for money.

Q What does the future hold for commissioning in the NHS?

A The Coalition Government has confirmed the continuation of commissioning as the basis for the improvement of health services. An independent NHS Board will be established to allocate resources and provide commissioning guidelines. Practice based commissioning (PBC) will be established whereby GPs will be given the responsibility of commissioning the major part of their patients’ requirements.

It is understood that practices when commissioning will be encouraged to work jointly with neighbouring practices and to engage the private sector, local authorities or PCTs to assist them. It is also possible that the PBC groups could outsource all or some of their commissioning functions. The role of PCTs will then be to act as champions for patients, commissioning only those services that are best undertaken at a wider level rather than directly by GPs. The services remaining at PCT level will include public health, maternity care, dental and optometry services.


Duncan Eaton has over 40 years’ experience in public sector and civil service management and procurement, operating at chief executive level for 16 of those years. In particular he established and was CEO of the NHS Purchasing and Supply Agency (NHS PASA) between 2000 and 2006.

He is a past President of the Chartered Institute of Purchasing and Supply (CIPS) and the Health Care Supply Association, and is a recipient of lifetime achievement awards from both GO magazine and the Health Care Supply Association. He also received the Swinbank Medal from CIPS.

Mr Eaton is a Non-Executive Director of several health care-related companies and has been a member of two OGC Procurement Capability Review teams. He is also the Special Advisor to an All Party Parliamentary Health Group.

He was a Non-Executive Director of BiP Solutions, publishers of GO magazine, from 2006 to 2009 and is now Chair of BiP’s Strategic Advisory Board.

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