Sir James Mackey thought he was going to be NHS England’s saviour. Instead, he will be its undertaker.
Within days of accepting the post to turn around the administrative body that sits on top of the health service over two years, he was told the brief had changed: Health secretary Wes Streeting was not going to overhaul it, he was going to axe it altogether.
The decision was so tightly guarded that board executives were not told until the morning of the announcement, on a video call.
Most of the 15,000 staff only learned of the decision when Prime Minister Sir Keir Starmer dropped it into a speech on improving the British state. It came as a bombshell.
“Others who didn’t see the speech learned their job was at risk from the BBC news alert on their phone,” said one of the organisation’s officials.
The move came after months of rising tensions between Streeting and those directly running the service, multiple people with knowledge of the events leading up to the decision have told the Financial Times.
His eventual decision to fold back the running of the health service into the central department ends a decade-long experiment in managing the NHS at arm’s length.
Over that time, an ageing population has piled complex and costly requirements on to the system, draining resources and driving up waiting times.
The appointments backlog now stands at 7.43mn, while public satisfaction with the NHS has fallen to its lowest level in 40 years.
Reducing waiting times and improving NHS performance has become a cornerstone of how the Labour government expects to be held accountable by the public at the next election.
Axing NHS England, or NHSE as it is called in the sector, is the first step the government believes it must take to grapple with a health service that is in dire need of an overhaul.
“The NHS is far too centralised, holding back frontline leaders from running services productively,” said one government official.
It is still not clear how the service will be run once the government takes direct control in two years’ time, or how this will affect the NHS’s ability to deliver its services.
The official added: “This isn’t about replacing NHSE micromanagement with departmental micromanagement. We are taking power in order to give it away, with resources and responsibilities devolved down to the front line. That’s how to get more innovation, efficiency and better services for patients.”
Questions were already beginning to swirl over the independence of NHSE in the weeks leading up to Streeting’s appointment as UK health secretary last July after Labour’s landslide election victory.
Health leaders whispered in hushed tones about its future as they watched a number of key architects of Sir Tony Blair’s public services reform agenda drafted in to advise Streeting in the run-up to the election.
Among them was Alan Milburn, New Labour health secretary between 1999 and 2003, whom officials say was clear from day one about the need to bring NHSE back into the central department.
Streeting’s allies at the time were adamant that abolition was not on the cards, pushing back aggressively on any suggestion that the new administration would reverse the operational independence granted under the Conservatives in 2012.
The decision itself to announce the shake-up was made between Streeting and Starmer over a series of meetings that concluded just a month before being announced, according to people close to the discussions.
Conscious of how damaging it could be if the news leaked, a small number of officials in Downing Street and the Department of Health and Social Care were tasked with keeping one of Whitehall’s best-kept secrets.
Such was the discretion that Amanda Pritchard, the outgoing chief executive, only had 24 hours’ notice of the decision.
Staff were already braced for cuts. Four days before the announcement, those working in central operations at NHSE were warned of job cuts of up to 50 per cent across the organisation.
Yet the internal notice gave no indication that this was the first part of plans to abolish the body entirely, which was not announced until the Thursday.
“At least by telling them properly from the top, it meant when the news dropped it wasn’t totally out of the blue that there would be changes to jobs,” said one government official.
Streeting himself appeared to have ruled out axing the unit as recently as late January.
In an interview with the Health Service Journal, Streeting acknowledged there was “a genuine and legitimate question about whether you would choose by design to channel so much public money through an arm’s length body”.
But he had concluded that “changing some job titles, TUPEing over staff and changing some email addresses” would “not make a single difference to the patient interest.”
Over time, however, he is understood to have become more and more frustrated with the duplication of roles between the two organisations.
Allies said he had been thinking about abolishing the whole organisation for a few months, but the decision was crystallised after a series of flashpoints between the central department and NHSE earlier this year.
In January, NHSE officials raised the possibility of reducing the percentage of patients who needed to be seen within the four-hour A&E waiting time target, which Streeting considered “baffling”.
There was also tension over the practice of corridor care in hospitals, with NHSE trying to refer to the treatment of patients in corridors as “temporary escalation spaces”, which “really wound Wes up”, one person said.
Streeting was also frustrated with the delay around the publication of the Valdo Calocane report, which investigated the care given to the killer by the NHS in the months before he stabbed three people in 2023, according to his allies.
At the same time, there was increasing pressure from the Treasury for all departments to identify where they could make swift and sharp savings and slimline the machinery of government.
“The department [of health] needed a headline and were going to have to contribute towards the killing of the blob,” said one senior health official. The department “had to be seen to be playing its part, so there was a bit of a sacrificial lamb element to this”, they added.
NHSE declined to comment. The health department said: “We’ve been up front from the beginning that wholesale reform of the NHS was needed.
“This ambition was reflected in this year’s planning guidance, which said NHSE would become a smaller organisation this year, with spending reprioritised to allocate more funding to systems, frontline providers freed from the shackles of micromanagement and better care delivered for patients.”
Milburn, chief health adviser to Streeting, was “very consistently” and “very early on” arguing that it did not work to have two head offices managing the health services, according to people briefed on the discussions.
One added: “He was clear with Wes on the need to not have two chiefdoms, to bring NHS England back into the department and get more direct control over the running of the health service”.
