The NHS: efficiency need not be a dirty word.

The National Health Service, yet again, is being cajoled and coerced into being more efficient. Many in the NHS resent this, perhaps understandably given the way in which the concept of efficiency has been devalued by this government. It is, however, an unfortunate reaction because efficiency is not something to be despised or feared. Despite the cajoling, little seems to change. The Royal Commission on the NHS, set up in 1976, considered "the best use and management of the financial and manpower resources of the National Health Service."' The Griffiths inquiry, seven years on, sought "to give advice on the effective use and management of manpower and related resources in the National Health Service."2 As economists it is second nature to us to want to support efficiency. Indeed, we are often puzzled by the lack of enthusiasm shown by NHS staff in pursuing efficiency. As a result, in October last year we organised a workshop on economic appraisal in the NHS and invited 11 senior staff in the health service and health departnents to discuss why the NHS fails to embrace economic appraisal to promote efficiency and how these problems might be overcome. We base this article on the report of these workshop discussions.' Firstly, however, we define efficiency and economic appraisal.