On Tuesday 2 July 2013, the Public Accounts Committee (PAC) issued a highly critical report regarding NHS consultants’ contracts.

The 2003 contract, designed to lift productivity and career development, has failed to achieve this, and has thus provided taxpayers with ‘poor value for money’, the spending watchdog has found.

There are currently 40,000 consultants working for the NHS, and by 2012, 97% of NHS consultants were estimated to be covered by the 2003 terms. These consultants had been granted pay increases from 24-28% under the new contract, and in 2011-12, their total employment cost was £5.6 billion, or 13% of all NHS employment costs.

However, the pay increase has not resulted in the requisite productivity increase.

A major drawback of the contract is that it allows for consultants to refuse working evenings or weekends, thus forcing the NHS to pay up to £200 an hour for overtime. Despite the increases in their pay, consultants are still in short supply in some parts of the country, in hospitals in deprived areas and in some specialties such as geriatric medicine. The only solution that the NHS is able to turn to is reliance on locum doctors, who are more expensive for the already cash-strapped NHS.

It was also found that Clinical Excellence Awards, intended to be awarded to those going above and beyond what is expected of them, are ‘the norm rather than the exception’. 60% of consultants currently possess one of these awards, which cost the taxpayer £500 million a year.

More than half of trusts were also not checking that consultants were meeting performance objectives, and 17% of consultants have not had an appraisal in the last year. This was ‘made worse' by the discovery that progression for consultants is linked to years spent in the job rather than to their performance.

"This nonsense highlights how badly consultants' performance is being managed," committee chairman, Margaret Hodge (Labour MP for Barking), commented, adding: "A proper culture of performance management for consultants and other NHS staff must be implemented if we are to avoid incidents of poor performance."

The recent tragedies exposed at Mid Staffordshire Hospital only underline the vital importance of improving the culture of the NHS in order to improve patient care overall. The report concludes that ‘most organisations rely on performance management procedures to get the most out of their staff. We consider the failure by the NHS to implement a proper culture of performance management as a crucial factor in the poor standards of care recently witnessed.'