18
National Resilience Committee
Uncorrected oral evidence
Thursday 2 July 2026
11.30 am
Members present: Baroness Coussins (The Chair); Lord Farmer; Baroness Hunter of Auchenreoch; Lord Marland; Baroness Mobarik; Baroness Northover; Lord Oates; Baroness Paul of Shepherd’s Bush; Lord Peach; Lord Spellar; Baroness Winterton of Doncaster.
Evidence Session No. 17 Heard in Public Questions 148 - 157
Witnesses
Andrew New, Chief Executive Officer, NHS Supply Chain; Dr Peter Gogalniceanu, Centre for Health Security, Guy’s Hospital; Mark Samuels, Chief Executive, Medicines UK.
USE OF THE TRANSCRIPT
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Andrew New, Dr Peter Gogalniceanu and Mark Samuels.
Q148 The Chair: Good morning and welcome. Thank you for coming to help us with this very important inquiry. I should remind you that it is a public session and we are being broadcast live. In a couple of days, you will each receive a transcript of the session, so there will be an opportunity to make any minor corrections that need doing. Of course, if you think of anything afterwards that you wish you had said, we always welcome supplementary evidence in writing. We have a lot of questions to ask you and I ask that, before you give your first answer, you introduce yourself very briefly so that we have that on the record. Thank you.
I will start with the first question and ask a general scene-setting question for you to describe how and where the UK’s healthcare products, including medicines, are currently made and what the implications are for the supply chain resilience. We have had written evidence, for example, that we import 90% of our penicillin from China, which was a statistic that rather alarmed me. We also import a very significant proportion of other antibiotics. I wonder whether you could comment on that in your general answer about how we get our products and where from, and what the implications are for the supply chain. I will start with Andrew New from the NHS Supply Chain.
Andrew New: Thank you very much, and thank you for the invitation. I am the chief executive for NHS Supply Chain. It is a company owned by NHS England, currently responsible for buying and fulfilling around two-thirds of the non-medicinal products to the health service in England, including everything from CT and MRI scanners and large diagnostic equipment through to food and stationery, going all the way through implantable devices and ward-based consumables—a broad variety of things that are consumed across the health service. Of those medical devices and implantables, around one-third have the final manufacturing location in Europe, around 20% in North America and around 20% in the Far East, with the balance being domestic.
It is key to note that the supply chains that sit underneath our major suppliers are truly global. Although we may receive a large piece of diagnostic equipment manufactured in North America, a large proportion of the components that go into it will be managed in the Far East, managed across Europe and consolidated at their point of assembly. The same happens typically across the west coast of Ireland in how medical devices that are implantable tend to be made and then moved into the UK as part of an import. We are a truly global supply chain. The majority of manufacturing happens outside the country, and we integrate that together through NHS Supply Chain and into the NHS in England.
Dr Peter Gogalniceanu: Good morning. Thank you very much for the opportunity to speak. I am a consultant transplant surgeon. I have been in the NHS for 26 years. I am here in an individual capacity as an academic who works in healthcare security and crisis management. I have no supply chain background, and I am not representing my organisation.
Speaking as a clinician, the main single point of failure that I can see is that some surgical specialties are now becoming dependent on—or predominantly performed with—certain equipment. For example, the vast majority of robotic platforms are single suppliers and overseas. From my perspective, one of the biggest areas of focus needs to be the device consumables that operate these machines: staplers, robotic arms, robotic scissors and so on. If we were to lose those, we would not be able to do certain operations that are very common, such as prostate or kidney cancer surgery.
Mark Samuels: I am the chief executive of Medicines UK, the trade body representing 45 pharmaceutical companies that supply around nine out of 10 NHS medicines, although not all. Most are generic and biosimilar medicines. To answer your question on manufacturing, the UK manufactures almost one-quarter of its medicines here in Britain, which is a good proportion—a good success—for any country. We get about one-third of our medicine from India and another one-third from the EU.
Of course, finished medicines are not the whole story, because we have to look at medicine ingredients as well. About half of active pharmaceutical ingredients come from China and about half come from India. That is a proportion that has changed over time; it used to be that far more came from China, but the Indian Government decided as a matter of policy that they wanted to be more self-sufficient, so they have invested in active pharmaceutical ingredient manufacturing, which does show that it can be done and turned around if we were to take that seriously.
About two-thirds of the NHS’s generic medicines cost less than the price of half a first-class stamp for a month’s supply. That has an immense impact on supply chains. It means they are stretched globally to find the most affordable ingredients in manufacturing, and it means all the resilience is taken out of it, because all the reserves are taken out. I am happy to talk about that and answer some questions on it. I do not think we especially need vast sums more money, but I do think that the money that we have through existing budgets could be spent far more wisely. I am happy to come on to that, but there are some fairly sizeable budgets that I think have been ill-spent and would have been much better spent on national resilience. The other way of sustaining such a low-margin industry is to ensure that unnecessary red tape and bureaucracy is minimised to help companies supply the NHS affordably.
Q149 Baroness Northover: This has been a live issue for quite some time, and of course it came out of the pandemic as well, in terms of how resilient the United Kingdom is. The question is: how far can or should the UK assume responsibility for manufacturing its own drugs, vaccines and medical equipment? How feasible is that, and what more can we do to make it more resilient? Can I take the answers left to right, starting with Mr Samuels?
Mark Samuels: We can always do more. It is always wise to manufacture domestically if you can. We will never manufacture everything here, so that means international relations are very important. The Government have a trade agreement with India that has an MoU on medicine supply. If that were fleshed out in more detail, that would obviously be very valuable, given we get one-third of our medicines from India. The relationship with the EU is critical, given we also get one-third of our medicines from the EU. Crucial in the EU relationship is the current huge disincentive for companies to invest in UK manufacturing, because the current agreement with the EU says that, if you are a company in the EU with manufacturing plants in the EU, you can export to the UK with no problem, but if you manufacture in the UK, you cannot export to the EU, so it is a one-way street. We have lost about 7,000 medicine manufacturing jobs in the UK since that agreement. We have been asking pretty loudly for mutual recognition for UK manufacturing and EU manufacturing. That would be very helpful.
The Government, to their credit, have something called the life sciences innovative manufacturing fund, which is a £520 million fund. That is necessary but in no way sufficient. We welcome that, but more could be done. The antibiotic example you gave is illustrative. We have almost no antibiotic manufacturing left in the UK. Almost the last manufacturing plant for antibiotics in England closed last year. There is a negligible amount left. We are, in effect, entirely reliant on overseas antibiotics. That would be a strain in a pandemic and, if we were in a conflict situation in 2030, as has been widely published, we would obviously be in remarkably deep trouble.
As a last point, I think that there is money that could have been invested to solve things like that. For example, the life sciences sector plan has three pillars; not one of those pillars is resilience. It has 33 actions; not one of those actions applies to generic medicines, even though they are nine out of 10 medicines used by the NHS. The plan invests £600 million in something called Health Data Research UK. I am sure that is a good thing, but it would have been helpful from a resilience perspective to have looked at the trade-offs: whether we put £600 million into an NHS IT project to support health data research, or whether we put £600 million into strengthening the UK’s active pharmaceutical ingredient manufacturing and antibiotic manufacturing. It costs, as a ballpark figure, £150 million to set up a new antibiotic manufacturing plant. We could have had four of them for the same money. I feel strongly, as you can hear, that resilience needs to be a much stronger priority for this or indeed any future Government.
Dr Peter Gogalniceanu: I would not be able to comment on medicines or the supply chain, but in terms of preparing for the next crisis, we need to think also about the way we will resource—not just the way we practise medicine now, but how we will have to practise it in a highly disrupted environment, because people will be getting sick in different ways. This is where having the clinical perspective is really important, whether it is supplies of tourniquets, stretchers or other issues, because in that highly disrupted whole-of-society situation, our framework needs to be at a NATO level. The ability to move resources across the alliance is really where we need to be. It is not the UK versus Europe, but whether we can work at a NATO level to share those resources.
Baroness Northover: Is there anything on that within the NATO preparations? Do you know?
Dr Peter Gogalniceanu: I am aware that the NATO medical action plan addresses it. I do not know how that impacts at an NHS level or from a local government perspective. The challenge is how we bridge that national-international policy with what happens to clinicians at the front end, who may not be aware of those requirements or indeed of the threats and vulnerabilities they face.
Andrew New: In terms of device manufacturing, we are an integrated part of global supply chains where the products for the majority are very similar to those consumed in all countries. This is therefore not just a UK or an England issue. It would require a global repositioning of where those products are manufactured. Our view has always been that, although there is some potential to increase manufacturing in the UK for products, the investment has always been a challenge because of the length of funding cycles and therefore the investment cycles. When I met with a supplier six months or so ago and asked how long they would need an agreement with NHS England to provide one-third of a certain category of product, their answer was that they would need a 10-year contract to warrant the investment in infrastructure, and they typically work on a far shorter cycle than that across the system.
However, the UK and the National Health Service is a fantastic place for innovative new products that enhance future ways of delivering care, and it is critical that we use the establishment we have to scale and adopt new innovative technologies, creating new businesses in the UK and using those new businesses as a way of building resilience in the way that future care is delivered, rather than trying to reposition those global markets to the way things have always been done. The health service is moving so quickly that I think that forward view is probably more helpful than the backward one.
The Chair: Lord Oates, your question has been partly answered, but I am sure you have something to add to it.
Q150 Lord Oates: My question was around the international aspects, and you have touched on them. I wonder whether there is anything you would want to add about any specific actions in terms of international co-operation that we should think about to reduce the supply chain vulnerabilities.
Mark Samuels: Europe is the closest politically and geographically, and therefore having mutual manufacturing recognition would be helpful. When I have discussed that with government colleagues, they have questioned what is in it for the EU to recognise UK manufacturing. I think that the answer is twofold. If a company were deciding whether to expand its manufacturing in the UK or in India, for example, I am sure the EU would rather it were expanded in the UK, because it is simply closer geographically. It would get across the English Channel much quicker than on a longer journey.
The other part of the UK’s negotiation is the broader context of everything the UK brings to the EU in terms of resilience and security. Beyond medicines, we provide one of two nuclear-armed powers in the European region, along with all sorts of other intelligence and security benefits to the EU. If you look at what the UK brings to the EU as a whole, a mutual recognition for UK medicine manufacturing would seem to be both in the EU’s interest and an entirely reasonable negotiating priority for the UK Government as part of their reset with the EU.
Dr Peter Gogalniceanu: From experience, while all hospitals fail the same way, different countries prepare differently. In countries that are frontier NATO nations with the Russian Federation, the security awareness is different, and they are probably five to 10 years ahead of us in terms of mentality on how to prepare. Studying the way their civilian health systems work would be really interesting, as would how they collaborate with their defence medical services.
Q151 Lord Farmer: Thank you for your informative evidence. I will build on what you have said already, particularly for the first questions. To what extent does the UK health system have the surge capacity and supply chain robustness to ensure that healthcare products can be delivered even in the event of multiple disruptions and hybrid threats? We saw what happened with Covid. There was panic and disruption. What would happen today?
Andrew New: NHS Supply Chain works closely with the Department of Health and Social Care on pandemic preparedness activity, particularly with ensuring that there is flexibility in response to different types of major incidents. The Department of Health owns a major stockpile of the medical equipment available—particularly around personal protective equipment—in those circumstances. We operate and integrate that activity into business-as-usual activity for the NHS to ensure those products are flowing regularly.
At the moment, the NHS supply chain’s physical infrastructure is roughly the same size as it was in Covid. We have added a few hundred thousand square feet of physical space, but not a huge amount. Working across government, we have put forward a proposal and had it approved by the Treasury to materially enhance the size and range of products that can be held across the NHS supply chain. While there are currently around 7,000 different items held in stock across a variety of locations, with approximately four to six weeks of depth, in future we are looking to double the range of products and increase the depth for products where there is a material risk of issues. Today, there are approximately 350 products where we are aware of risks around supply resilience and that are used frequently in the health service. We have increased the depth to have six to eight weeks of stock in the UK available to distribute at any one time, which will give us enough time to work with global manufacturers to ensure that we can fill behind and go forward.
We have moved away from where we were at the end of Covid, though we have not yet moved to where we wish to be. My expectation is that, in the next two and a half to three years, we will have built the infrastructure and deployed the technology to be far more flexible, adaptable and able to respond to the standard we should expect when we have surges in demand.
Dr Peter Gogalniceanu: The question of surge capacity is really important. The NHS is designed to absorb peaks in demand, as you would see if you had a rail crash or a disaster like that of Grenfell Tower. We have done that well by all accounts in the past. My main concern is that the next crisis will not be a peak, but a sustained plateau of disruption, as we see in Ukraine. It will have a different form, a hybrid form. It may be a technology failure that leads to a capacity loss. We then move from specialists providing that surge capacity response to having an all-of-medicine response. Ninety-five per cent of the workforce is not geared to acute response.
The questions we need to ask are: how do we transform an outpatient radiographer, a professor of rheumatology, or someone who serves food in the canteen into being part of that all-of-medicine response? That comes down to a question of readapting the medical workforce to be more flexible. That is one of the lessons we learned in Covid; we need to be able to work across domains and in disrupted environments.
Q152 Lord Marland: I have two very brief questions. One has just emerged. In terms of reserves, given that no antibiotics are being manufactured in the country, you have said that we have reserves of six to eight weeks. What do you think is the optimum figure that we should get to in terms of storage and reserves of medicines? I will turn to the second question. Mr Samuels, you are probably best placed to deal with both. I was on the International Agreements Committee. We signed a trade agreement with India. Were you invited to extend that MoU into part of the trade agreement, or are you in discussions to do so?
Mark Samuels: On the first point, stockpiles are part of the answer, but not the whole answer, and there are several aspects to that. The DHSC has a list of critical medicines that it has worked through. We know from the pandemic that stockpiling was part of the reason we did not run out of medicines. It was sheer luck that we had a stockpile before the Covid pandemic, because we had built one up in anticipation of there being issues getting medicines into the country for the Brexit transition. It turned out there were no such issues, but the pandemic struck so we had a stockpile of medicines. The tricky part is who will pay. When two-thirds of medicines cost less than half the price of a postage stamp, manufacturers are going to struggle to pay for a stockpile, and the UK is already in competition with other countries for stock allocations. A limited government stockpile is probably part of the answer, provided it is not paid for by industry.
Having agility in domestic manufacturing is also part of the answer. If you have a manufacturing plant in the UK, you will often store about a year’s worth of medicine ingredients, so in a time-limited crisis, that would actually help mitigate our reliance on other countries for medicine ingredients. We also learned during the pandemic that some manufacturing plants can be agile; if we run out of one thing, we can switch to another. That happened with the Oxford-AZ Covid vaccine, where AstraZeneca did not have the capacity to manufacture enough of the vaccine for the rollout in the UK, but a company called Wockhardt had a manufacturing plant in Wales and could switch it to manufacturing the Oxford-AZ vaccine. It was thanks to that Welsh manufacturing capacity in Wrexham that we had a successful first rollout of the vaccine during the pandemic. It is that combination of factors, not stockpiles alone, that is important in mitigating a crisis.
Briefly on the second question about the free trade agreement, I understand from DHSC colleagues that they are seeking to flesh out the MoU with India on medicine supply, but I do not know the level of progress on that yet.
The Chair: In the supply chain, are any discrete arrangements made about blood and blood products that distinguish regular routine procurement procedures from what might be needed in a surge capacity crisis situation, in terms of blood collection, processing and transfusion infrastructure?
Mark Samuels: I do not know the answer to that because our members are not involved in the blood service. We could have a look and see whether we can find an answer for you, but perhaps other colleagues would have an answer.
The Chair: Does anyone know anything that is special about blood?
Dr Peter Gogalniceanu: The procurement is different. It does not come from a factory, which is important. In my experience, we are incredibly fortunate in this country to have excellent transfusion services. Conflicts of all kinds, whether driven by state or non-state actors, are resolved in large part by the ability to transfuse. If you cannot manage shock or a massive haemorrhage, there is no point managing anything else. It is important we think about the transport of blood, because that has implications in terms of what type of blood is available for transfusion and how we preserve and move it around the country. It is not just about blood transfusion; it is about blood products, platelets, plasma and other components that are necessary. That question is best answered by a haematologist with an interest in transfusion science.
Andrew New: In terms of the consumable products associated with blood, there is not a one-size-fits-all solution in the way that we buy products for the NHS. Each grouping of products has a strategy designed for it around the needs of the service. Where there is greater resilience required, for different reasons, that is weighted higher in the way we design solutions for the NHS to receive goods. Blood products are a separate category and will therefore have a solution designed for them that is suitable across cost, environmental sustainability, resilience and other attributes you would expect to see. That said, I am not aware of anything specific in the way those products are designed to enter the service compared to the broader catalogue of what is available.
Q153 Baroness Winterton of Doncaster: I want to ask you about lessons from other countries around economic safeguards and stockpiling. You have perhaps already made the point that if everything were manufactured here it would all be quite a lot easier. I just wondered if there are any other lessons you think we could draw on. I also wanted to ask whether, because we have quite a unique healthcare system in the NHS, you have any reflections on whether that places us in a stronger position than insurance-based systems, or whether it is the opposite.
Mark Samuels: Starting with the positive, having a national health service in secondary care has provided the opportunity to strengthen resilience. NHS England, to its credit, is looking at procurement of medicines in tenders and is imminently putting into the tender weighting a reliability of supply criterion. I think that is helpful, and NHS England deserves credit for that.
The resilience directorate in the Department of Health and Social Care has expert and highly experienced people in dealing with shortages, and that is helpful from a national perspective. It also brings a concern, because some of those people have fantastic know-how gained from the pandemic. We need to make sure that we retain that know-how, given all the challenges around headcount reductions that are going on in NHS England and the DHSC. I would be very concerned if we were to lose some of the most expert people in resilience, but they are currently there and that is helpful.
Primary care is a little more challenging. On the upside, if there is a shortage, there is the opportunity to increase prices and therefore more encouragement to bring medicines into the UK. The downside is that community pharmacies have been under immense financial challenges just to keep the lights on, let alone thrive, and that has led them to use algorithms for their procurement of medicines, which has driven some of the shortages we have seen. The national picture, as always, has pluses and minuses.
Baroness Winterton of Doncaster: What are the lessons from international comparisons?
Mark Samuels: The most interesting one is India, because India was concerned it was reliant entirely on China for medicine ingredients and decided it was going to do something about it—and it has done that. It has now become one of the major manufacturers of medicine ingredients in its own right. That does show that it can be done. It is perhaps a secondary issue to resilience, but India has decided it will be a leader in biosimilar medicines and has just committed a $1 billion investment to do something about that. That is an order of magnitude that we in the UK could have afforded if we had chosen to spend other pots of money differently. We could learn from India in terms of securing and strengthening the UK’s resilience.
Dr Peter Gogalniceanu: To answer the question about the resilience benefit of the NHS compared to other countries, first of all we have a huge operational advantage in that, when someone is injured or when 5,000 people who are injured turn up, you do not have to ask for an insurance number. It also means you can move patients between different organisations as their care needs change. If, for example, someone has a neurosurgical requirement, they can be moved very easily to another hospital.
On latent capability, we are again very fortunate in that, in the NHS, you can be a clinician caring for patients while at the same time being an innovator, an entrepreneur or a researcher, which means a lot of the solutions to our problems are coming from the grass roots. Our challenge now is to create the platforms that allow us to capture those innovations and turn them into products or services that can improve our resilience. The same applies to taking the experiences of Covid—as one of my colleagues mentioned—and turning them into science. The NHS, as a melting pot of academia, innovation and clinical practice, is best positioned to do that.
Baroness Winterton of Doncaster: What about international comparisons?
Dr Peter Gogalniceanu: On the international dimension, I have never had to make a clinical decision based on a patient’s insurance. We can focus on what is best for that patient without worrying about creating medical bankruptcy.
Baroness Winterton of Doncaster: Are there any lessons from international experience?
Dr Peter Gogalniceanu: I think that we need to rebrand clinicians as innovators. Hospital leaders also have amazing innovations that come out. We just need to tell them that that is what they are doing and try to understand how we can formalise those into products and services.
Baroness Winterton of Doncaster: Does that happen in any other country that we could learn lessons from?
Dr Peter Gogalniceanu: Innovation hubs and incubators are becoming much more common in university hospitals. I am not sure whether colleagues working in non-university or non-tertiary hospitals have the same opportunities, but that is why we need to take a much broader national-level perspective on innovation so everyone can participate.
The Chair: Mr New, do you have anything to add on this one?
Andrew New: There is certainly some material benefits of the national organisations within our broader health service working so well together and collaboration now is better than it was five years ago when I joined. I am told it is better than it ever has been. Having Lawrence at the MHRA, having NICE, having the department and having NHS England in the room to better have conversations means that you can get to points of decision quickly and efficiently, particularly when under challenge. When we need to draw people together for resilience-type matters, there is a moment of drawing the system together to ensure continuity of care can happen. We are reasonably uniquely placed to be able to do that at a national level. There are some real benefits to being able to bring the whole national team together and make decisions quickly and make change happen in support of patients and taxpayers.
There are challenges that our service does create. We have a service that is very much focused through local trusts with local populations and their accountability is to those people who deliver exceptional care and value for money for the taxpayer. There are also times in a resilience scenario, for example, where that becomes a real challenge, where local decisions are being made that might not go into the greater good of a national health service. Trying to co-ordinate those two things together can be exceptionally challenging. That is part of the balance you have to find when you want something that is devolved and pushed out to be as local as possible but also takes the best of the national piece that comes alongside it. It is a compromise, and it is a compromise that we recognise.
Baroness Winterton of Doncaster: Again, are there any other countries that we could copy that do it better?
Andrew New: There are different archetypes that come from different ends of the spectrum. I have recently met with a regional government organisation in India. It is not a national one, but at a regional level it has the same scale as England in terms of population. They are looking to move far more towards our model of central control over some activity, but with local decision-making. In contrast, meeting with a Minister from Mexico recently, I learned that they have come from an absolutely controlled, standardised bill of materials to go into a hospital and now are trying to relax that to give more local choice.
The best answer for resilience and value for money and service will sit somewhere in the middle. I think that everyone is trying to find what that position in the middle looks like. It changes because the external environment, product innovation and clinical research change. What we need is the agility to get to that optimum position as often and as quickly as possible.
Q154 Baroness Hunter of Auchenreoch: Thank you, gentlemen, for coming to assist us. We have heard from various witnesses about Exercise Pegasus testing the pandemic preparedness across all government departments and regional administrations, and the private sector, the voluntary sector and community and faith groups. There was one this year and I think that there is one planned for next year and every year thereafter. Have your organisations been involved in Exercise Pegasus and, if so, what are your observations and recommendations?
Mark Samuels: Yes, we were involved in the most recent exercise. I thought it was well organised and incredibly important to do. I was pleased and relieved that the Government were doing something like Exercise Pegasus. There was an element of fighting the last war because it did seem to mirror what we had just been through with Covid. I suppose that is inevitable; it is tricky to avoid that.
From my own sector, the supply of established medicines was perhaps taken for granted, because one of the interjections was along the lines of what would have happened if supplies from India and China were interrupted. I do not think that everyone realised that the NHS would probably immediately grind to a halt because we ran out of medicines quite quickly. That was a surprise to many, but then that is part of the point of these exercises that learning comes out of them. I hope it goes ahead again.
It is vital we stop taking for granted established medicines. Governments of all persuasions over many years have focused on the possibility of tomorrow’s new medicines, vital though those are, while forgetting about the fact that we need today’s medicines that are well established in the NHS. The supply of those medicines needs to be further taken into account in the next Exercise Pegasus, and not just for geopolitical reasons. If we are reliant on China for pharmaceutical ingredients and there is an earthquake or they have an outbreak of another infectious disease—or if shipping is disrupted, as we have seen recently in the Middle East and previously with the Suez Canal—all these things can affect the supply of medicines. I hope that the next Exercise Pegasus will consider that.
Baroness Hunter of Auchenreoch: Was the word “resilience” used? You said it does not even appear in the life science plan.
Mark Samuels: No, the life sciences sector plan does not have resilience as one of its key pillars.
Baroness Hunter of Auchenreoch: Did you discuss that?
Mark Samuels: Yes. I was on the advisory board for the sector plan. I raised that in the board. We even went public and wrote a thought piece about why resilience needed to be in the life sciences sector plan, but to no avail.
Baroness Hunter of Auchenreoch: Is it at the core of Pegasus?
Mark Samuels: It is at the core of Pegasus, yes.
The Chair: Mr New, have you been involved with Pegasus?
Andrew New: Yes, we are an active part in the Pegasus activity. Clearly, we operate some of the pandemic preparedness stockpiling activity on behalf of the Department of Health and Social Care. My team were an integrated part of that testing. I agree that it was well run and well thought through. For us, it had a number of different streams associated with personal protective equipment, as well as medical devices and other things required to operate across the NHS.
There are a broad number of learnings that have come from that activity that are currently being implemented across various parts of the health service. For us, it is the integration between the activity we do as a business as usual—the day-to-day things—versus the activity that would be required in a pandemic. We are ensuring that the scaling of the two can work alongside one another, to the point that we have made some physical choices around our office locations. If you have that pandemic response, where would we resource different bits of the organisation? In Covid, for example, there was mass scaling to ensure personal protective equipment was required. The number of people involved is the whole size of my commercial organisation. Therefore, I cannot move everyone to do that task, because at the same time they still need to be able to buy all the blood products and other things that are consumed across the health service.
We had a very good test of our own processes and a very good test of those that are provided to us by the department. Lessons have been learned along the way, and we look forward to the next one. I think that there will be more we will learn as we test different avenues to ensure that we are prepared.
One of the challenges in the health service is the financial challenge. It is likely that we could embed greater resilience into products that are consumed every day, which would enable us to scale more rapidly when under different types of pressure. In the health service, the cost of those products is greater than we pay today, and we are aware that there are financial constraints in the service. The timing of how to implement these truly resilient supply chain solutions is a choice that we need to continue to make—and we need to make it every time we refresh contracts and make new decisions. We do weigh resilience as a material part of all decisions that we make around ensuring that products will be available when they are needed by clinical experts to care for people.
The Chair: Were you involved as a clinician, Dr Gogalniceanu?
Dr Peter Gogalniceanu: I was not and I cannot comment, but if I may make a comment as a third party observer to this, I think that Exercise Pegasus is an excellent example of why we should do these exercises, because we should stress test not just our infrastructure but our leadership decision-making capacity and capability.
There are two crisis management traps that come with exercises. The first, as my colleague said, is that you exercise the last crisis, not the next one. That is fine; that is just a human way of being. The second, however, is that we stop at table-top exercises. Running an exercise in an organisation is disruptive in time, money and operations and it is very easy just to do a table-top. What we really need to do is to move it to the front line and understand how it would fail in controlled environments.
The Chair: Thank you. Let us move on to another issue.
Q155 Baroness Paul of Shepherd’s Bush: As a committee, we are quite concerned about cyber risk. I will start with you, Mr New. How does the National Health Service address the cyber security risks arising particularly from third-party suppliers? To what extent do you map and have and a transparent understanding of those risks and any concerns about legacy systems? Are there any other comments that you would like us to be aware of on the cyber space?
Andrew New: There are two tiers that come with this. We have our own organisation. NHS Supply Chain is an integrated part of how care is delivered and therefore a critical part of the infrastructure. As part of the answer to how we build greater resilience, we are in the process of replacing all our legacy technology because it has been recognised that there is an operational risk associated with it, alongside the cyber challenges of maintaining it. We already have the support for our own organisation to make those investments and to move to modern systems.
Baroness Paul of Shepherd’s Bush: That is not the NHS, it is just your part?
Andrew New: No, that is just my part; that is my organisation within NHS Supply Chain. Our resilience is getting stronger, and over that two-and-a-half to three-year period I will sleep better at night, given the whole host of different risks that we have to monitor and manage. That is good investment being made by government; it is a priority that will support the whole of the NHS in its resilience.
We then look at the resilience of the supply chain. The supply chain to the NHS is vast. There are between 700 and 1,000 different products that could be consumed in the NHS on any day. Over an average three-year period, around 165,000 different products are bought. They are bought from thousands of different suppliers, and to have the depth of assurance across all those would be a mass undertaking. I think that it would be beyond anyone’s technical ability to do. We have to prioritise where we see products with the highest risk and highest impact on the health service. They could be products with embedded IP. They could be products that are embedded into care pathways that would require changing clinical practice to implement an alternative, or they could be products where we have historically seen vulnerabilities across the supply chain.
We take an assessment at the point of tender based on government best practices around supply selection activity. We also continue to monitor that throughout its life—through GSCIP, the Global Supply Chains Intelligence Programme—to look for issues and incidences of challenges around products being used or suppliers to the NHS. We take proactive measures for those that we stratify as being the highest risk with the highest impact, to work with them on how they may wish to improve their levels of cyber security.
There have been issues over the past 12 months, as we have had significant compromises across suppliers within the supply chain. Therefore, we recognise that alternatives management, and the agility of the national system coming together to solve problems, is critical. While we can be always be better in prevention and proactive activity, we do have a service that is exceptionally good at responsive, reactive, problem-solving activity, which is one of the reasons why I am confident, when I look across the supply chain, that we could deal with any disasters happening today. If an issue does happen, we will respond rapidly to it and we will do it as a team. Therefore, we will prevent any major issues impacting patient care.
Baroness Paul of Shepherd’s Bush: Would you have any comment about the preparedness of any other parts of the NHS? We have some concerns about whether trusts have made the investments that they need to at various times. It sounds like you buy the stuff and you are very good at doing that, but it is all the other elements of the NHS that we are also concerned about.
Andrew New: When I speak to colleagues operating across trusts, they have a very mixed experience. When I speak to suppliers of technical solutions that we work with, I can see that those solutions are being utilised more broadly across the NHS. However, I have no doubt that there are parts of the service that are operating on legacy technology similar to ours and they will be in their own stages of that modernisation to modern, secure, protected environments. I cannot speak as an expert on how their digital programmes are being delivered individually, but it is recognised as a priority across all boards and all organisations that we have to be resilient to the cyber challenges we have seen recently.
The Chair: Do the other witnesses have anything to add on cyber security?
Dr Peter Gogalniceanu: Generally speaking, on the topic of cyber security, all systems can be hacked no matter how much good stuff we invest. Therefore, the weakest chain becomes a human element and one of social engineering. We have to presume, as part of our resiliency strategy, that we will lose our digital infrastructure at some point for some period of time. Therefore, that comes back to the point that we have to retrain our workforce to operate, at least temporarily, in an analogue system.
Health systems abroad routinely turn off their digital infrastructure, so their workforce is used to operating the way I used to operate when I was a junior doctor. A lot of our workforce struggle to read cursive handwriting because we just have iPads. Getting people to have that experiential learning in an analogue environment is very valuable, so that when something happens it is just an emergency and not a crisis.
Q156 Lord Peach: Let us stick with this theme. You have been very clear—and thank you for coming—on the issues around the supply chains. Of course, we are really considering if it gets worse with concurrent crises and potentially hostile activity. We would like to follow up on the blood conversation because it is very important.
I am also struck by your point about the medical flexibility of the workforce. We are awaiting the new NHS workforce strategy, and I have a specific and a general comment. The general comment is about the command and control within the NHS at a regional level, between trusts and beyond, and whether you would, even if you just want to speculate, look at how we are organised at the national level. That I will leave to you.
I turn to my specific comment, which sounds small but is not. I declare my interest as president of the Council of Reserve Forces’ and Cadets’ Associations. At least 90%, possibly 95%, of the UK’s medical reserves work for the NHS. In the event of a national emergency, how are they going to be prioritised, because all our defence plans rely on them being available for the national emergency? I do not know whether that issue has been considered in Exercise Pegasus or not. However, when we are starting to think about contingency in multiple crises, that is the thinking that we perhaps need to undertake.
Andrew New: I will start in reverse order. NHS Supply Chain is the majority supplier of the consumables and devices that go into the military stockpiling activity. We work as part of that integrated system. Therefore, we would work with the NHS and the department, across government, to ensure that the allocation of reserves will go to the right place at the right time, to the extent that we can support all different fronts at the same time. Consumption information, our tendering activity and our product selection—the needs of the other government organisations we support—are included in that decision-making. Whether the rapid scaling is covered effectively would be a useful test to ensure that that can be delivered.
That was the second part. Sorry, what was the first part of the question?
Lord Peach: On government structures above the regional level.
Andrew New: My experience recently—this is about point activity rather than a massive spike—is that, where specific products that can have a material impact on patient care become unavailable and we move into a position of controlling how much of the demand can be fulfilled, the service pulls together well to deliver the outcomes required, including the clinical workforce who are happy to make compromises and change their ways of working to ensure that the patient experience is maintained.
You would have seen recently that we have had some bone cement issues with a supplier availability challenge. It required an alternative product to be sourced and made available rapidly, and the service worked as one solution to ensure that there was continuity of care happening across as a whole. Whether that would scale if you had 150 problems happening at the same time, the same processes would be followed, but clearly there would be resource constraints around those individuals undertaking the activity.
The service works exceptionally well together in a crisis. My concern would be around the workforce and their ability to deal with that crisis for six, eight, 10, 12 or 26 weeks in a row. I think that is where we would have to ensure we were far smarter in rotating people through and making sure we have effective support for our people who will be fundamental. It is not something that AI will fix; it will be a people thing.
Mark Samuels: On the importance of know-how, because we have been through various single crises from the large-scale Covid pandemic through to smaller-scale things like the Suez Canal being blocked, at the centre in DHSC there are those people who have been through that. They have worked with us in industry, and they have some experience of handling that. That experience would be vital if we were to have multiple simultaneous crises or hostile action, compared to someone who is completely green and had not had any of that crisis management know-how.
My concern is that we retain those people with that know-how, otherwise we have people with absolutely no experience of handling crises. Given the lack of certainty over people’s jobs in what was NHS England and what is DHSC now, I think that needs to be raised. We do not want to lose the people who actually know what they are doing in a crisis.
Dr Peter Gogalniceanu: One of the major determinants of a crisis outcome is crisis leadership. We have seen on a number of occasions the desire for the clinical workforce to learn how to lead in a crisis. We have implemented at all levels interventions on how to do that. It is a specific skill and it does not naturally come to you just because you are good at operating or you are a good CEO. That has to be a deliberate exercise, and we have to provide the opportunities for leadership at all levels. Compare that to the Armed Forces, where there is a good hierarchy but there is also leadership training, even if you have a 21 year-old junior officer. In the NHS we do not necessarily have that. We are exploring how to do it. I think that we have to create local capability to teach people crisis management.
Going back to your point about the impact of Ministry of Defence doctors being deployed, I cannot answer that directly but I would say that we have deployed doctors out of departments before to a variety of other humanitarian or defence events abroad. It goes back to the idea that the non-military doctors—the people who are not in acute roles—need to understand what their roles and responsibilities would be in that disrupted environment. That is, ultimately, a mindset issue.
Lord Spellar: I will just follow up with your Armed Forces example. The Armed Forces, particularly in the UK and eastern European countries, invest a lot in NCO training. You described it as training surgeons to become officers. What about more local leadership, which enables that decentralisation of decision-making?
Dr Peter Gogalniceanu: I think that leadership goes down to the lowest possible level. You have to devolve it as much as you can. We are very lucky that we have nursing, medical and administrative pathways that have good leadership structures. The challenge is how you create leadership across those domains because a lot of clinicians are not involved in those plans. Although they are the tactical arm of the response, they are not involved in the operational and strategic side.
The short answer is: I think we have to learn more from the Defence Medical Services and the Armed Forces in general.
The Chair: Thank you. Lady Mobarik has the final question.
Q157 Baroness Mobarik: Thank you very much for coming. Gosh, it has been rather sobering hearing the evidence today. If I am honest, it has left me with a growing sense of unease as to our preparedness. What one recommendation would you make to the Government about preparedness and resilience? In other words, what keeps you awake at night that is not being addressed by policymakers currently?
Mark Samuels: There needs to be a very clear, unequivocal sense of direction from the very top of government, whoever is Prime Minister, that resilience needs to be the very highest priority. There are always trade-offs in government but, given the geopolitical times we are living through, resilience needs to be a much higher priority.
I have alluded to spending commitments that have been made where money was spent on projects—or self-serving projects—that could have been spent elsewhere on resilience. The money is there if it is a clear priority from the absolute top of government. What we cannot have is 30 priorities. It must be clear that resilience is the topmost priority, otherwise people will struggle to make the right trade-offs.
Baroness Mobarik: What is your top-line recommendation?
Andrew New: I was speaking to colleagues before coming in and said I have to remember that I could design a health service around having a resilient supply chain but it would probably be a terrible health service because it has to focus on patient care and value for money in the broadest sense. Therefore, I recognise the compromises that are made and the response we need to make to ensure we have resilient global supply chains to support it.
It should be said there is a lot going on that is enhancing the resilience of the health service. Whether it is our own modernisation, our support for trusts on their inventory management services, putting in new technology and solutions to get visibility of data across trusts to ensure there is mutual aid where there are challenges or behavioural activity, there is a lot happening that is enhancing the performance, efficiency and effectiveness of the NHS while also building resilience. That should be celebrated. However, if we can make that go much faster, we would be in a great place sooner.
If I were to ask for one thing, I would say: give priority to integrating the day-to-day activities around the requirements of resilience into the things that we do. Afford the service the flexibility to make decisions, whereby even if it is not the lowest cost solution, we know that it would stand up to scrutiny and challenge if we had a major event. Make that a greater priority for us and we would be able to design a more resilient supply chain and a better service for our nation.
The Chair: You have the last word, Dr Gogalniceanu. What is your top-line recommendation?
Dr Peter Gogalniceanu: What keeps me up at night? Can I provide the best quality of care to my patients in the context that I am operating in? That goes down to having local capabilities clinically, operationally and in terms of the supply chain. At the moment, there is a disconnect between strategy and policy and what happens on the front line. What I would like to do is to promote the concept of local health security centres that can provide a bridge so that we are the implementation arm of government policy, as well as the workforce development effector for our workforce capability.
The Chair: Many thanks, gentlemen. That has all been extremely helpful and we are very grateful. Thank you so much for your time. I now close the public session.