National Health Service: Managers

HL Deb 11 April 1984 vol 450 cc1153-65

3.16 p.m.

Lord Hunter of Newington rose to call attention to the need for managers in the National Health Service; and to move for Papers.

The noble Lord said: My Lords, I rise to move the Motion standing in my name on the Order Paper. There must be few places in which there are the accumulated wisdom and experience of managers and management that one finds in your Lordships' House. I have hesitated to raise this matter of health service management, but the whole thing is becoming urgent and requires your Lordships' wisdom. In another place the Social Services Committee has reported and its evidence is available; and I understand that there will be a debate in another place at the beginning of May. To me, therefore, the opportunity is ripe for your Lordships to influence these matters while they are in a formative stage.

Many of your Lordships have experienced health service management at first-hand. Many started their voluntary social work on boards of management and boards of governors. Personally, I have happy memories of boards of management in the early days. Who led? It was sometimes the chairman, sometimes the finance officer, the administrator, or perhaps the senior administrator on the board. Up and down the country they varied enormously, but most operated in the way that best suited local needs. Boards of governors, from years of experience, had established a balance with administrators and doctors, and the governors held that balance.

Then came change. Following the reorganisation of the Department of Health to form the Department of Health and Social Security, plans were launched for the 1973 reorganisation of the National Health Service. Many things happened, but two vital changes were, first, that the boards of management disappeared, to be replaced by district management teams which were instructed to develop consensus management. The relationship between these district teams and the area health authorities was never happy. Now, the district authority is important, is vital, and the area authority has disappeared; there has been a further reorganisation.

In the 1982 reorganisation, many able adminis-trators left. Now, line management is proposed; but, more than that, radical changes are proposed through-out the National Health Service and also in the Department of Health. The Department of Health and Social Security, on the health side, has had to combine the functions common to any department of state: advising Ministers, formulating legislation and national policy, and combining this with the management of an enormous and highly complex service. Under the Griffiths proposals it is important to distinguish the two sides of the department's activities and imagine how they will continue. Clearly, the first of these functions will be undisturbed by the Griffiths proposals. It is important, however, that the second function is related directly to the establishment of the management board which is proposed. This has fundamental implications for the role, organisation, staffing and mode of operation of large parts of the department—a department which has borne its share of cuts in the general austerity; some 20 per cent. of staff.

If the challenge of clarifying the responsibilities and line of management of these departmental activities is not faced, then the consequences for the management board are serious. A shift of this kind was envisaged some years ago in the three chairmen's review, in 1976, entitled "Regional Chairmen's Enquiry into the Working of the Department of Health and Social Security in relation to Regional Health Authorities". Mr. Griffiths does not mention the cost or scale of the staff necessary to sustain the corporate function of the management board, though in evidence to the Select Committee, the Permanent Secretary. Sir Kenneth Stowe, said: I think we will work as we have to—within a manpower constraint. So, when the new system is working there will be no more people in the aggregate than there are now".

A further sorting out will have to be done by the Secretary of State in relation to regional chairmen, who are responsible to him and have right of access to him. The position of the director general will have to be clarified. From the evidence, his Civil Service ranking will be the same as that of a chief medical officer.

The concept of general management is central to Mr. Griffiths' proposals. In my view he restricts the idea unnecessarily by focusing on the general manager as an individual rather than on general management as a function of the organisation; that is, recognition of general management as the reponsibility of a group of individuals who are senior managers. After all, in the modern world, senior management is about the effective working of teams. It is not only important to avoid polarisation of an individual; it is also of vital importance to the introduction of any new management system. Moreover, this cannot be done overnight. For years there has been a chronic lack of investment in management recruitment and development in the service. The management inquiry team may have noted this. Where are these administrators to come from? They have to be, we are told, exceptional people.

Professional clinical autonomy is central to everything to do with the Health Service, and it is necessary to examine this in some detail. Enormous strides were made in the 1960s as a consequence of the "cogwheel" reports of the then Chief Medical Officer, Sir George Godber. These involved doctors in management and made them increasingly aware of the need for resource allocation and conservation. Since the reorganisation in 1973, so far as I can see, there has been little progress on this front although the clinical committees continue. So far as nurses are concerned, they believed that the Salmon Report gave them authority, status, and managerial functions which they did not hold before: now they feel more threatened, I think, than anyone else. I am glad that the noble Baroness. Lady Cox, will be speaking in this debate.

The Griffiths Report observed: We have been told that the NHS is different from business in management terms, not least because the NHS is not concerned with the profit motive and must be judged by wider social standards that cannot be measured.

I do not agree. Moreover, this is not the most remarkable feature of the National Health Service. There are two features of great importance, and there may be others. The first is the wide range of specialties that contribute to health care and the different values and priorities of these groups, which often operate in isolation. The second is the extent to which doctors are able to commit the resources of the organisation through the legitimate exercise of clinical freedom. They have a blank cheque in some respects. The profession is increasingly aware of this fact, and the awareness factor is growing. Every consultant is a managing director in his specialty, but he also works on the shop floor, and, by legitimate action, can make nonsense of planning. As Griffiths says, these consultants must be concerned with resource management. I agree.

Griffiths also recognises that management budgets must be made to meet the medical requirement and interest. This is a major task, and there is one big unknown factor which has recently become evident. That is the general practitioners' demand on hospital services. One general practitioner will make a demand of, say, £200,000-worth a year of services, while another will make demands for £1 million-worth a year of services. They seem to be consistent, because the million pound man continues to make that degree of demand. This seems to be a very important thing in the planning, and little information about National Health Service costs has hitherto been available. Yet this information is a necessary prerequisite for any form of budgeting. The information must be available; it must be fast, reliable and accurate. These require- ments can be met only if a computerised system is used. And how long will this take to set up? I do not think the organisation that is envisaged could possibly function without it.

The recommendations of the Griffiths Report imply a greater detail of clinical audit than has so far been accepted by the medical profession. I believe that many are now ready to co-operate on this but the matter may in the first instance have to be confined to the relevant clinical divisions: that is. carried out by peer review, as it has been in some units for many years. This could be arranged very quickly and easily while the other arrangements are being made and the information systems set up.

Management has been defined as including planning implementation and control. Control implies that the consultant manager has the power and authority to increase or to restrict resources, including staff facilities and services within the overall limits of his budget. The 1982 reorganisation has already created management tensions between unit management teams and "cogwheel" executives. The key area is between the clinical manager, or clinical management, and the general manager. This will have to be worked out and, with safeguards, should be possible. It surely must be possible. The medical profession has moved forward. If this recommendation of Griffiths is implemented in one form or another, then the whole exercise will have been worth while.

One weakness of the Griffiths report is that it appears to make the resolution of professional difference a matter for general managers. This has received substantial criticism in some quarters. Interpreted in one way, it does not make abundantly clear what I am sure was clear to Mr. Griffiths and his colleagues; that is, that the good manager has to gain the trust of those he works with, and he must have a fundamental understanding of the whole system. Such a person obviously must be of exceptional ability. The best professional manager I ever knew was the noble Lord, Lord Porritt. I suspect that he would hate being called "a professional manager", but in fact he ran 21 Army Group surgical services in a way that I feel any general manager in the new set-up would wish to aspire to, and with the same degree of quality.

I have already referred to some difficulties. The solution seems to be the use of management boards with clearly defined responsibilities, certainly as a first step. But the time is ripe to consider what are the basic requirements for the evolution of a new management system in the National Health Service. Mr. Griffiths, in his introductory statement to the Social Services Committee, had no doubt that everyone would benefit: patients, and staff. Sir Brian Bailey said this: Eighty-five per cent of decisions will still be consensus decisions.

The House of Commons Social Services Committee identified a number of important matters. Other noble Lords will be discussing this and I will make only a brief reference now to two key points. The committee asked: first, what is the future role of the consensus management team at district level and the future pattern of the medical advisory machinery? They are already in existence: what is to happen? Secondly, the committee recommended that general management function at unit level be postponed until the review of general management at higher level was completed. That is the opposite of the Griffiths recommendation.

The responses of the authorities consulted will provide further information in this regard, and we all look forward to the Minister's contribution to this debate. The Secretary of State showed a great deal of determination when he reviewed the Griffiths Report by accepting it resolutely—gaps and all—and immediately setting up the skeleton of the supervisory board. Sadly, the gaps in Griffiths give a glorious opportunity to those who for one reason or another want to defer or destroy it and to read into the report what they fear most. A system which involves clinical audit, I believe, must come, but the way in which it is introduced is vitally important.

There is one last question. Can we introduce this matter into the hospital situation and settle it separately from general practice? My Lords, I beg to move for Papers.

3.30 p.m.

Baroness Robson of Kiddington

My Lords, I am sure that we are all very grateful to the noble Lord, Lord Hunter of Newington, for giving us the opportunity of discussing the future management of the NHS. At the time of the Statement on the Griffiths Report on 25th October, many noble Lords in this House expressed their desire for a full debate on the issues involved and so far the Government have not seen fit to satisfy that desire. I am also very grateful to the noble Lord for setting out the historical background to our debate today.

The NHS, from its inception in 1948 to 1974, benefited from a fairly limited amount of interference from Government; but in the past 10 years, as has been said, it has had to contend with an almost unprecedented number of reorganisations of which this is the third. Even local government, whose future occupied this House till the late hours of Monday night, has not been subject to that number of reorganisations. On 25th October, my noble friend Lord Winstanley welcomed the Statement made by the noble Lord, Lord Glenarthur, in so far as it dealt with a devolution of powers from the centre to the grass roots, as well as the appointment of individuals with management abilities at certain levels— something which many of us in the health service had been advocating for many years.

Since that time, we have had the privilege of reading the Griffiths Report in depth and an increasing number of doubts have therefore arisen in our minds. We are more than ever concerned about the gaps in the report and the proposed speed of implementation across the board. I understand that when the Secretary of State makes a Statement in the other place shortly health authorities are to be told the timing of the implementation that he expects.

The other matter that concerns me—and it is borne out by what the noble Lord, Lord Hunter of Newington, has said—is the reservations expressed by doctors about the advantage of the Griffiths Report, because without their support Griffiths cannot be implemented. The delegation of authority at and below district level presents enormous problems, because of the existence, as has been said, of indepen- dent clinicians as well as a large number of other groups, most of whom are self-managing in professional matters, and have to be so. We would not want to change that. You would therefore have to draw a distinction between the responsibilities of these groups; between clinical freedom and professional accountability and managerial accountability. So whoever is appointed general manager at unit or district level, be it administrator, nurse, treasurer, or doctor, will come up against this problem.

One might perhaps believe that the appointment of a medical administrator would cause the least problem, but I have still to be convinced that one clinician is able to control the activities of his fellow clinicians any better than members of any of the other professions. So whoever is appointed will have formidable problems and, without meaningful information and data, he or she will fail to make the impact which we all hope will flow from a strengthening of the managerial role within the health service.

The health authorities have laboured under constant pressure to reduce their administrative costs for the past 10 years. They have done that, so the percentage of revenue devoted to administrative costs, which is really management costs, is now below 5 per cent.—by far the lowest management costs anywhere in the world. They have done this at the expense of losing some very good people through early retirement at both reorganisations. They are now asked to improve their management structure without increasing the overall cost—almost, I would have said, an impossible task.

I mentioned earlier that a manager needs meaningful information and data to perform his task; in other words, he needs the tools of his trade. We do not have that. We cannot give him that at the moment in the health service. In this connection, I can mention a personal experience. On behalf of a charity with which I am connected, we wanted certain information which one would have thought quite simple: what does it cost the NHS to perform a vasectomy operation? We approached the DHSS and various health authorities, but we were unable to get the answer. In the end, I appealed to one district health authority treasurer who was prepared to do a special exercise for us and, in the end, we obtained some kind of a price. But this was not an average cost throughout the health service, and it was no basis on which to make comparisons between one authority and another.

However, I am pleased because I understand that the Government hope to introduce the recommendations contained in the Körner Reports by 1987. These reports recommend the collection of management data by each health authority relating to different activities, based on both financial and clinical information, such data to be common to the whole health service. At the moment, those data are completely diverse between authorities. But if they were common to the whole health service they would be interchangeable, and one would then be able to compare like with like and have a proper basis for managing the service.

This will not be a cheap exercise, because it means setting up a whole new computer system for the service. It also, in my view, entails the setting up of individual budgets for each clinical department within a hospital and making clinicians responsible for the financial management of their departments. When this has been done, a commercial type manager for the NHS will at least have some of the tools he needs for his trade; that is. basic information.

Is it not therefore essential, if we are to introduce Griffiths, that the management board at the DHSS spend some time filling in the gaps in the report? And they are not mere gaps; when you start looking at it, it is almost like a sieve. It is important that they should do this job; that they should negotiate with the professions—and I mean all professions, not only the doctors—within the NHS, in order to get total commitment from them in favour of an improved management structure. This would happen before the health authorities were asked to implement what is at the moment purely an outline of a possible structure for the improvement of management in the service.

I saw in The Times of yesterday that the Department of Health are head-hunting for this superman who will be chairman of the management board. It appears that there is not an enormous number of people standing at the doors of the DHSS asking for the job. It will be an extremely difficult job for whoever takes it on; and unless the management board examine the Griffiths Report and recommend the right kind of structure for the authorities to be able to implement the report, it will not succeed.

There is another problem which worries me very much; what will be the true relationship between the Secretary of State, the supervisory board—which we all insist should include the chief nursing officer at the Department of Health and Social Security—the management board, the regional chairmen and the role of health authority members? Many questions remain to be answered.

3.40 p.m.

Lord Mottistone

My Lords, I, too, should like to congratulate the noble Lord, Lord Hunter of Newington, upon introducing this debate so skilfully, and for making clear to us the outstanding points which we have to consider. As I said in an earlier speech on the subject, I am deeply concerned that unless these kind of problems are tackled, the National Health Service will, over the years, price itself out of existence. If we are to keep the NHS, which I am sure we all want to do, it is very important that this problem should be tackled.

I speak with diffidence because my only personal contact with the National Health Service has been as a patient. However, my daughter is a State Registered Nurse and my wife gives me a worm's eye view as a voluntary helper in the wards of a children's hospital. A worm's eye view can sometimes be useful. Outsiders can see where there are shortcomings, particularly the high cost of wastage, which others might not notice.

I have to apologise to your Lordships for the fact that pressure of other business during the past two or three weeks has not enabled me to discuss the Griffiths Report nearly so fully as I should have wished. Therefore I speak mainly as a manager and—dare I say it?—as a Fellow of the Institute of Personnel Management, and in particular from my experience as a director of the Distributive Industry Training Board, a non-profit making body which was established by Act of Parliament to provide a service to industry.

I have been involved with management in many other organisations and have observed that there are certain fundamental features of management which are common to all types of organisation. Accordingly, I welcome the Griffiths Report because it seeks to incorporate those essential features of management within the National Health Service system as it stands. Unlike the noble Baroness, Lady Robson of Kiddington, on the whole (though everything has imperfections) I see much more good in the Griffiths proposals than possible failures. However, I was delighted that as her speech progressed the noble Baroness seemed to be more enthusiastic for it than she had been at the beginning—though perhaps I misinterpreted what she said.

I see the Griffiths Report as a common-sense manager's identification of what is needed to adjust the organisation of the National Health Service so as to make it properly effective, and (I quote from paragraph 3 on page 11 of the report): to secure the best deal for patients and the community within the available resources; best value for the taxpayer; and the best motivation for staff". I am not surprised at the quality of the report because for many years I have had the privilege of knowing one of the members of the inquiry team, Mr. Jim Blyth. I have the highest opinion of his quality as a practical senior manager.

I would give particular support to their ideas for establishing a National Health Service management board with an externally recruited chairman and an externally recruited personnel director. I give support also to the Griffiths understanding that changes need to be established from within the present system, thus involving minimum cost and avoiding, as far as possible, what could be interpreted as yet another radical organisational change, with the added benefit of minimum delay for it to become effective.

Above all, I believe that the proposals will provide a clearly identified leader with clear responsibilities at each level of management. Consensus management, as I understand it, can never produce properly effective results. This does not mean that the executive manager does not have to take his team along with him before decisions are made. It means that it is clearly seen by everybody—by all the staff and by all the other managers—that somebody is in charge. I suspect that that is not so clearly seen today.

If I may now tread on rather more delicate ground, I believe that one of the main difficulties for the National Health Service is that doctors naturally consider themselves to be the most important people in the system.

Baroness Gaitskell

Why not?

Lord Mottistone

The noble Baroness may say "Why not?" but doctors may not necessarily be good managers.

Viscount Massereene and Ferrard

Hear, hear!

Lord Mottistone

My Lords, they may, on the other hand, even if they have the potential to be good managers, consider management to be simple, something which any intelligent person can do, and that therefore they do not have to try very hard to become good managers. Industrial history is littered with examples of companies which have gone "bust" when they have been passed on to successors who have taken that kind of view, or who have naturally been bad managers. Unfortunately, the National Health Service as a whole, and its individual units and hospitals, are spared the discipline of going "bust", so if they are badly managed they just become inefficient and are unhappy places for staff and patients alike.

Therefore I strongly welcome the recommendations in paragraph 19 of Part II of the Griffiths Report, that doctors should receive management training during their initial training, and subsequently. The noble Lord, Lord Hunter of Newington, said that this had happened, but I understood him to say that this has not been continued. Many people feel that management training is an insult to their qualities, but the fact is that there is a great deal to be learned by us all. Some leaders are born, but most of them have to work very hard in order to become good managers.

If anybody seeks to be better than the others—the noble Baroness, Lady Gaitskell, asked "Why not?" when I said that doctors think that they are better than the others—I believe that they must be good managers. Since I hold that view, it saddened me when I read the BMA's comment on the concept of an executive manager—not just one executive manager but executive managers in general who are the key to the success of this scheme. The BMA says that this concept has no place in the National Health Service. I may be slightly overdoing this, but I regard the BMA's comment on the Griffiths proposals as "damning with faint praise". Unless that attitude can radically be changed, there is no hope for these imaginative proposals and little chance of improved services for customers—that is, for patients.

Therefore I very much hope that the Government will tackle without delay the problem of the false concepts of doctors and that they will implement the Griffiths proposals as fully as possible and as soon as they can.

3.50 p.m.

Lord Taylor

My Lords, my noble friend Lord Hunter drew a rather gloomy picture of two GPs, one of whom sent work worth £250,000 to the hospitals every year and the other who sent in work worth £1 million a year to the hospitals. He said that it would be a good thing to investigate what was going on. I am not sure that it would, because one may very well discover that the GP who is doing the good job is the one sending in £1 million worth of work and that the other fellow is not really giving his patients the attention which they should have.

May I say how grateful I am to my noble friend Lord Hunter for raising this matter, for a reason which will appear in a moment. Some 45 years ago a group of young doctors, of which I was one, were considering how we ought to run our health services and what they ought to be like. We reached five conclusions. The first conclusion was that, whatever happened, it had to be a universal service simply because the risk of serious ill-health was universal and the cost of treating serious ill-health was likely to increase very greatly in the years ahead. I believe we were right on both those two points.

Secondly, we concluded that it was essential that it should be a high quality medical service, because a mediocre service would be worse than useless; it would set a low standard and would permeate the whole structure. We concluded also that the administration had to be designed to achieve those two ends. We were not politicians and were not concerned with politics in this matter, but we were sure that it had to be a regional service, for technical reasons—because if we were to provide the pool of seriously-ill patients within any particular specialty, that could not be achieved without a regional hospital service. Fourth, it had to be taken away from the municipal hospital authorities, because in municipal hospitals we had a hierarchy of medical care, with the only road to promotion being to give up clinical medicine and become an administrator. The standard of clinical care which we saw in municipal hospitals was such as to appal us.

Lastly, we concluded that we also had to ensure that the service in the future was divorced from the Civil Service—which is almost, if not quite, as soul-destroying as the municipal services. On looking around for a model, we reached the conclusion that by far the best model was the BBC. For this we worked and we struggled but we did not win.

In due course, Mr. Aneurin Bevan became Minister of Health and at the same time I happened to become a Member of Parliament. I found to my joy that we had allies inside the Ministry in the shape of, first, Sir John Hawton, who some of your Lordships may remember. He was a wonderful civil servant. He was a deputy secretary and then became the permanent secretary. The second was his lieutenant, Mr. Pater—another outstanding civil servant who has, incidentally, just written a very good history of the National Health Service. The third was Sir Wilson Jameson. He was chief medical officer from 1940 to 1950 and he was, I believe, the best chief medical officer I have ever known. He was a wonderful man. However, I must add that we are extremely fortunate in the new chief medical officer who has just been appointed. Dr. Aeheson.

Between us, we steered Mr. Bevan away from municipalisation of the hospital services and onto regionalisation, but we failed to get freedom from Civil Service control. We went for the next best thing, which was to get a maximum of autonomy for the regional hospital boards, so that they could act as largely independent corporations—each in charge of a very large area and of enormous capital and current expenditure. Since then, some people—particularly, I am afraid, in the Civil Service—have waged unremitting war on the regional hospital boards. Twice in my lifetime they have nearly succeeded in getting rid of them. I am pleased to say that they were frustrated.

In 1948, while still a Member of Parliament. I was appointed to the North-West Metropolitan Regional Hospital Board. Almost the first direction we received from the Ministry of Health was that we should pay our senior administrative medical officer the sum of £2,500 per annum. This just enabled us to get hold of Dr. McAuley, who was the MOH for Middlesex and a very fine and good man. But our senior lay executive (the regional hospital board secretary) was to receive £1,200 a year—less than a Principal in the Civil Service—and yet he was to be handling a budget of £10 million or £12 million. I fought this as hard as 1 could, but I could not get Mr. Bevan to understand what I was on about.

From that moment, regional boards became more or less creatures of the Ministry of Health. Despite this—outside London particularly—they have managed surprisingly well, and I believe they have saved the day. Many of your Lordships have received splendid treatment, as I have, from the National Health Service. That is due to the quality of our doctors and nurses, and also to the quality of our regional boards, who have done a splendid job. Both Mr. Griffiths and the Secretary of State have spotted that the best men they have on the administrative side are the men who run the regional boards; that is to say, the chairmen. Many of them have been and still are very high earners in the professions (other than medicine) or in the private sector. Incidentally, they receive from the Ministry a rather strange payment of approximately £7,500 a year for their part-time duties. That figure is exactly the same as the sum received by the chairmen of district health authorities.

It is my hope and belief that Mr. Griffiths has recommended, and that the Secretary of State has accepted, what we tried to achieve 40 years ago. He has done it very ingeniously, without altering the law. In place of the governors of the BBC we have the Health Service Supervisory Board with the Secretary of State as chairman. On that board is the Minister of State for Health, the permanent secretary, the CMO, and two or three non-executive members, of which Mr. Griffiths is to be one.

In place of the executive board of the BBC, under the chairmanship of the person who has been referred to already in this debate as the "director general" (and, incidentally, the report of the social services committee in another place refers to him as the "director general", and I have no doubt that he will in fact become the "director general") there will be an executive board. We also have the information that the director general will be appointed from outside the Civil Service.

Now we come to the crunch. Everything depends on the quality of this single appointment; of this new chief executive or director general. Mr. Griffiths must, I suspect, have been quite appalled to learn that he was to have the status and pay of a second secretary. The permanent secretary in the DHSS receives £42,750 per annum. A second secretary receives £39,500 per annum. We are told that the National Health Service is the biggest business in Europe, and I believe that that is probably true. These jobs need a man of the calibre of Sir Michael Edwardes or Mr. Griffiths himself. Frankly, I think they would laugh at such a salary, and certainly I am not at all surprised to hear that the Government are having difficulty in head hunting at that level.

Fortunately for us, the Government have published a book called Public Bodies—1983. It is a Cabinet Office publication: management and personnel office. It gives the actual salaries paid to the higher personages whom the Government employ to manage their affairs. These are divided into two groups—the full-timers and the part-timers. Top of the full-timers is the chairman of British Telecom who gets £85,000 a year. The chairman of the Bank of England receives £83,549; the chairman of the National Coal Board receives only £59,000; the chairman of the Post Office receives £57,000; the chairman of British Nuclear Fuels receives £52,000, and the chairman of the Law Commission receives £42,500.

The part-timers are even more interesting. The chairmen of the water authorities get £35,000 a year, part-time. They are top of the list. The chairman of the UGC receives £35,000 a year part-time. The chairmen of the BBC and the IBA each receive £23,000 to £24,000 a year, part-time. The highest paid people in the DHSS, in this part-time business, are: the chairman of the Medical Practices Committee who gets £18,483; the chairman of the Distinction Awards Committee, who is the chap who dishes out the fortunes to us fellows, who receives £9,240 per annum; and the chairmen of regional health authorities and district health authorities, who each receive £7,590. We can by inference—that is, by working out from the Scottish hydro authorities—ascertain the relationship between part-time and whole-time pay. They have part-time chairmen and whole-time deputy chairmen. A part-time chairman gets £18,000 and a full-time deputy chairman gets £32,000. One can therefore work out what one might think would be the correct rates.

I beg the Minister to think again on this. I beg him not to appoint, or even short list, a director of personnel before his new director general has been appointed. It would be absolute folly to do that. The job of director general of the National Health Service is a tremendously tough one. He will have to deal with the doctors, nurses, the underpaid, trade unions and their officers, and in many cases those jobs are perhaps overstaffed. He will have to deal with regional boards, the district health authorities and regional health authorities. Above all, he will have to deal with the Minister, Parliament and parliamentary committees. It will be a killer of a job.

I reckon that a short-term contract of seven years is about right. That was the time I spent as a vice-chancellor and I found that it was quite long enough. Therefore, I recommend a seven-year appointment at the approximate rate of £75,000 to £100,000 a year, with a two-thirds pension at the end of it. I think he will be clapped out at the end of that time. It will be a very tough job but we shall have a very much better National Health Service with such a man. He will have to stand up to pressure from everyone. If he does that we will get something really worth while. But I must say one word of warning.

Lord Mottistone

My Lords, before the noble Lord proceeds, may I put one point. If this person is clapped out will he not have the best health service in the world at his disposal?

Lord Taylor

My Lords, when a person is clapped out by hard work his situation is a little difficult to cure other than by giving him a pension.

My final point is this. Do not think that by making something efficient and working well one necessarily makes it cheaper. The truth is that we have a very cheap National Health Service compared with all the countries who try to do the same. It is very well run on the clinical side and on the nursing side, but the administration has not been good enough. It is not too difficult. I recommend that the noble Baroness, Lady Robson of Kiddington, should look at some good American hospitals. The George Washington Hospital, for example, is very efficiently administered by a doctor-administrator who has given up doctoring. It was at that hospital that the President was treated and it was that administrator who made the excellent broadcasts following the attempted assassination of the President.

I have great hopes, and it may well be that the Griffiths Report is a major step in the history of our health services. I hope very much that the Minister will have listened to and will follow the good advice that I have just given to him.