Privatisation of NHS Services

David Drew Excerpts

Monday 23rd April 2018 Westminster Hall

[Dr David Drew (Stroud) (Lab/Co-op)]

It is a delight to serve under your chairmanship, Sir Graham. I thank my hon. Friend the Member for Hartlepool (Mike Hill) for introducing the debate. It is an interesting opportunity to make some comments, perhaps sandwiched between two other Gloucestershire MPs. I will not say that is a delight, but there is much wisdom in what the hon. Member for Gloucester (Richard Graham) says.

Sadly, I have always believed that the NHS has been a party political issue from its very start. However, there is some ground for consensus on properly funding the NHS. There may be some disagreements about how we achieve that, but we have to lay down the ground by which we might know what we should fund, which of course includes the care service.

I intend to make a brief speech that is really only about subsidiary companies, because that is particularly apposite to us in Gloucestershire. However, I make one rejoinder: we actually defeated the PFI deal in Gloucestershire. We were offered one, but I thought it was very bad value for money, and I was one of those who spoke out against it. I think we did the right thing. We now have two fit-for-purpose hospitals, even though to get to this stage we have had to go down a pretty rocky road.

I will devote my comments to the setting up of a subsidiary company in Gloucestershire, about which the hon. Member for Gloucester made an aside. It was something I opposed, because I felt that it was the wrong direction to go in. More than anything, I felt very strongly that it was not properly scrutinised. It is the only time I know of when there has been a major change in the structure of our hospital provision in Gloucestershire, including to staffing, and the public and their representatives—including the health and care overview and scrutiny committee, which was effectively told to take its nose out of its interest in the change—have been excluded from the consultation.

The big change is that up to 700 members of staff will be taken out; there is an argument about exactly how many. I have met the chair and the chief executive of the trust, and I know why they have done it. It is about money and about trying to make good the real funding shortfall that has affected us in Gloucestershire because of the deficit that we have built up over quite a long period of time, and which we at least have to be seen to be talking about.

I will concentrate on a number of issues. I hope the Minister listens, because I will ask him several questions specifically about where we will go as a result of the changes. I resent the fact that representatives from Gateshead Health NHS Foundation Trust are going around the country as snake oil salespeople and telling trusts how they can save money. I and other Members have asked parliamentary questions on this subject, and my first question to the Minister is this. Can we have it on the record that the setting up of subsidiary companies will not be financed by some sort of VAT exemption? That is where the proposal initially came from. Although I have had assurances from the NHS, the Health team and the Treasury, the message does not seem to have gone back to those who still propose the idea. Can we have it on the record that there will be no VAT opportunities because of these new so-called subsidiary companies, in Gloucestershire and elsewhere in the country?

The second point I will look at is where the benefit of this change will be. I would have liked to see the full business case, but we were precluded from seeing it. We saw, dare I say it, a fairly anodyne version that looked as though it was all things to all people, but that did not really say how the change would be better—initially for the staff but also for the people of Gloucestershire—given that a large number of staff who worked for the hospitals trust are now in a different company.

Does the change preclude tendering? One of the advantages sold to the staff was that they would not have to face any tendering, because they would join a subsidiary company that was part of the NHS but that was necessarily different from the NHS because of the changed terms and conditions. My second question to the Minister is: is that fair, or could this company at some future date be passed over—I will not say sold on —to A.N. Other, who could be either a not-for-profit third party or, dare I say it, in the private sector? That would suggest that this change is not much of a defence against tendering.

The third issue I raise is that our hospitals trust—I say our, because there are three Gloucestershire Members here—finds it difficult to recruit, and faces a lack of money. There is also an element of desperation, rather than innovation. My third question to the Minister is: if, as I am led to believe, there will be a major pay increase for ancillary staff of as much as perhaps 15% over the next year, how can that be squared with other changes that will come further down the line?

My worry is that we—the proverbial we—have sold people an idea that they can get more money now and it will not affect their future prospects, yet we know from what has been suggested that it will have an impact on pensions. I know we do not have an NHS pension scheme any more; there is a series of NHS pension schemes, some of which are much more generous than others. However, it seems that those who are now in a subsidiary company must end up with a worse scheme, because how can they have a 15% pay increase and the same pension provision as those in existing pension schemes? It is the same for job protection and some other elements of the way in which the NHS looks after its workforce. I know the Minister is a fair person—we have discussed things privately—but I genuinely do not understand how this will all add up.

I worry that we are offering people something in the short run that may be beneficial and may get them out of working in supermarkets and into working in the NHS—that is a good thing—but, worryingly, they may come out of working in the care sector to work in the NHS, and that will not solve our problem. Our problem is that there are a lot of staff who are underpaid and very mobile, and we need those people to be brought into the NHS, to stay with the NHS and to be secure in the NHS.

My last point is one that I am, if you like, quizzical about. Gloucestershire’s sustainability and transformation plan, which has now been published, was seen as the overarching way in which our NHS would develop. However, all these changes, including the merging of two trusts—a mental health and learning disability trust and a community trust—and the setting up of the subsidiary company, happened in advance of the implementation of the STP. What is the point of the STP if many of the changes have already been made? It would help me when I am talking to my constituents, who feel quite worried about what is going on, to know what these things genuinely mean and what they will result in. At the moment there are a lot of questions but very few answers.

I do not want to see fragmentation. We can make the argument about privatisation, but fragmentation weakens the bond that the NHS is about. It is the national health service, delivered free at the point of use to constituents in the various parts of the country, including Gloucestershire. At the moment, however, we seem to be seeing further fragmentation, which may lead to all sorts of risks.

The answers to my questions have not come forward. That may be because we did not have a consultation; that was wrong. We should have had a full-blown consultation so that these questions could have been asked, not just in Gloucestershire but elsewhere in the country in the places that have been mentioned. It is our duty as parliamentarians to make sure that we ask those questions and to try to get the answers.

The Minister has heard what I have said. I could go on about other aspects of the healthcare system in Gloucestershire, but the subsidiary company is of primary concern at the moment. We have one in Gloucestershire. We do not know who will run it, how it will be run or what the future implications are. If the Minister hears what I am saying and can answer some of those questions, it would help us in Gloucestershire and people much further afield.