The reform of public services has been one of the signature policies of the Labour government since its  election in 1997. The National Health Service (NHS) has been at the heart of public service reform, receiving an unprecedented increase in funding, and using this funding to bring about improvements in services to patients.

Notwithstanding these improvements, much remains to be done to meet the expectations of an increasingly demanding population, and to match the levels of performance achieved in the best healthcare systems outside the UK.

With this in mind, one of Gordon Brown’s first actions on becoming Prime Minister was to appoint Ara Darzi to the ministerial team at the Department of Health with the task of leading a review of the NHS reform programme and to advise on how this programme should be taken forward. A core question that the Darzi Review needs to answer is what approach should the government take in the next stage of reform to enable the NHS to move from ‘good to great’, to borrow the language of management guru and author Jim Collins?

Looking back, most of the progress made since 1997 has resulted from additional spending on the NHS linked to top-down performance management. A good example is the reductions in waiting list numbers and waiting times that have occurred. These reductions have been driven by funding that has bought extra treatment capacity and the use of targets to improve patients’ access to care. Similarly, improvements in areas of clinical priority have resulted from increased investment linked to the implementation of national service frameworks and expert guidance from the National Institute for Health and Clinical Excellence.

While top-down performance management has been shown to be effective in improving the performance of public services, there is increasing understanding of its limitations, including the disempowerment of staff, the stifling of innovation, and the risk that areas not identified as priorities by those at the top will be relatively neglected. Recognising these limitations, the Blair government adopted a different approach to public services reform in its second term, placing much more emphasis on policies designed to bring about change from the bottom up by using quasi markets.

The government’s quasi market reforms for the NHS comprise four elements:

• Giving patients more choice and a much stronger voice, connected to stronger commissioning of services for patients by primary care trusts and general practices.
• Introducing more diverse providers, including providers from the voluntary and the independent for-profit sectors.
• Strengthening financial incentives to reward the best and most efficient providers and to enable money to follow patients.
• Clarifying the regulation of the health and social care system to ensure a consistent approach to standards of care.