The head of the NHS has said he 'doesn't buy that we need a lot of extra money’ as he admitted bosses waste it when funding is less constrained.

Sir Jim Mackey, chief executive of NHS England, said the service performs better when cash is tight and does ‘not spend it well’ when there is more ‘flexibility’.

Speaking at the NHS ConfedExpo conference in Manchester, Sir Jim said ‘tension is a good thing’ when it comes to NHS finances.

Health is the second-largest area of public spending in the UK after pensions and benefits, with NHS England alone spending around £196billion a year - almost double the £101billion in 2015/16.

However, waiting lists have rocketed over this period with performance worse on major targets, such as waits for routine care, A&E and cancer treatment.

According to the Institute for Fiscal Studies, the Department of Health and Social Care now accounts for more than 40 per cent of the government’s day-to-day departmental spending.

Health leaders have repeatedly claimed the service is short of cash and needs more funding to improve care and cut waits.

But critics say the NHS is inefficient and wasteful. 

Sir Jim said 'If I’m absolutely honest, in all the time I have been in the NHS, we have performed better and we have got better results when things are quite tight.

'Generally, when we've had flexibility, we tend to not spend it well, we can tolerate pilots, we can invest in something that's supposed to stop something else, and then before you know it, you've got two channels rather than one.

'So, I think the tension is a good thing.

He said that the service had 'built credit with the Treasury so when there is headroom we will get it.’

Sir Jim said improvements in performance in recent months have been made by changing the way things are done rather than by spending vast sums, adding: ‘I would say when you really unpack what happened in quarter four, either on electives or on urgent care, the cost elements are actually really quite small.

‘It’s much less than you’d expect it to be.

‘Nobody opened loads of beds, for example, they changed models, they changed dispositions, they’ve changed opening times, and you know those sorts of things. 

‘I don’t buy, we need a lot of extra money for it.’ 

Penny Dash, chair of NHS England, told the conference there is ‘enormous variation’ in the amount different trusts spend delivering care and ‘many, many, many opportunities’ to change the way some function to improve productivity and make savings.

Recent reports suggest the government may look to trim the NHS capital budget to fund defence spending. 

Sir Jim also said that definitions used to define mental health and whether or not people can access care ‘were set for a different time’ and that ‘pressure on the population has changed especially young people’.

He said the NHS is going to roll out ‘patient experience standards’ which will help the service keep people informed when they have been referred for care.

And it will work to tackle the problem of people queuing in a busy emergency department for ‘hours’.

Asked about young people’s mental health and neurodivergence, he said: ‘The thing that really bothers me in all this is that we’ve set our service up to fit certain definitions that were largely developed a long time ago – those definitions and those boxes of whether you’ve got a very well defined mental health problem or you don’t, and therefore you don’t access care, were set for a different time, in my view, society has changed, pressure on the population has changed especially young people.

‘We’re living with different pressures and challenges now.’

Sir Jim added: ‘A lot of the people that we’re worried about are unable to access care or they are in and out of care.

'So I think the big challenge for us is using the data, understanding better what’s going on in society, and come up with service offers that are proportionate and appropriate, rather than just saying, “We’ve got the money for this, so that’s what we’re going to provide”, because what that’s doing is it’s showing we’ve got a disconnect between us, the population and their needs, that’s complicated.’

On queues outside A&E, he went on: ‘A personal obsession of mine is how we bring more order into urgent care with more scheduling, more appointments times… rather than queuing at a busy ED for hours.

‘And frankly from our colleagues’ point of view – them trying to see risk in a crowded department.’

Sir Jim told delegates that ‘patient experience standards’ would be launched in a month.

He said that patients who have been referred for elective care often do not know if the referral has been made because ‘nobody has ever acknowledged it’.

‘You never get anything to say “We have got your referral, this is what is going to happen next”,’ Sir Jim added.

‘Generally we do nothing from a “you can make yourself better through the process and more ready for what is going to happen by doing these things”.

‘We’re going to try and release by the end of the month patient experience standards.’

He added: ‘I don’t think it’s usually about waiting too long, it’s about waiting too long and not having the acknowledgement.

‘You wouldn’t buy anything without acknowledgement – if you bought something online you get immediate acknowledgement, lots of annoying updates… why can’t we do that?’

Sir Jim said the move is about ‘modernising the service so it feels like the rest of our lives’.