8 - Resource management and budget holding

Summary

Introduction

Resource management was an initiative introduced into the Health Service in November 1986 by Health Notice HN(86)34 and followed from the earlier Griffiths Inquiry (DHSS 1983) which introduced general management into hospitals recommending that ‘ …each unit develops management budgets, which involve clinicians and relate workload and service objectives to financial and manpower allocations’. Resource management (RM) was a departure from earlier experiments focusing on clinical budgeting, which demonstrated that whilst important, understanding how much things cost is only one aspect of the resources needed to deliver highquality, cost-effective care and treatment.

Resource management is concerned with involving doctors and nurses in management of clinical services. In an organisation whose core business is the provision of health care, it is the decisions doctors and nurses make about the treatment and care of patients that commit resources. It is often said the most expensive piece of equipment in any hospital is the pen of the doctor or nurse. To be effective any new management arrangements must be capable of keeping the pen under control! What better way to do this than having those using them actively involved in the management process and accountable for the consequences of their decisions. Balancing the unlimited demand for health care against a limited budget requires difficult and complex decisions.