NHS Outsourcing and Privatisation

Maria Caulfield Excerpts

Wednesday 23rd May 2018 Commons Chamber

[Jonathan Ashworth]

If Members will forgive me, I will make a little bit of progress, and then hopefully we will get a chance for more to come in later.

Labour has been calling for a long-term economic plan for the NHS. We are led to believe that the Secretary of State agrees with us, because according to The Guardian, in an article headed “Hammond and Hunt in battle over NHS funding boost”, the Secretary of State and Chancellor are reported to be “at loggerheads”, with the Secretary of State calling for £5.3 billion extra, but the Chancellor only wanting to offer £3.25 billion. Of course, neither is quite as generous as the extra £45 billion for the NHS and social care across the Parliament that Labour was offering, but we will watch carefully.

Our plans would have been funded from increasing taxation on the top 5% of the wealthiest in society. Perhaps the Secretary of State can tell us how he proposes to fund his extra £5 billion. Will it be an increase in national insurance for pensioners, as has been floated? Or will other Departments be cut? Will the defence budget be cut to fund the extra £5 billion increase in the NHS? Will it be a move towards co-payment and charges? Or will it be another conjuring trick from the Secretary of State, whereby he claims to be increasing the funds going into the health service, only for us to subsequently find out that public health budgets, training budgets and infrastructure budgets have been cut and the settlement is not quite as generous as we have been led to believe? According to tomorrow’s Spectator, there will be a Tory splurge on the NHS, so he should honour the House today with his confidence and tell us where he thinks this splurge will come from—tax rises, cuts elsewhere, or charges and co-payments.

I remind the right hon. Gentleman: it was a Labour Government with Gordon Brown who increased taxation to pay for the NHS and helped us treble funding in cash terms, and it will be the next Labour Government who will increase taxation for the very wealthiest in society to fund a long-term, sustainable plan for the NHS. When we face the demographic challenges of an ageing population, with people living longer, the disease burden shifting and people living with co-morbidities, and when we are on the cusp of great advances and innovations from artificial intelligence and genomics, is it not clear that the current fragmented structures of the NHS are wasting energy, wasting time and wasting resources?

We are now led to believe that, according to the BBC, the Prime Minister and the Secretary of State, despite both having sat in a Cabinet that agreed the Health and Social Care Act 2012, have realised that the structures produced by that Act have been a dismal failure. I do not like to say, “We told you so,” but we did actually tell you so. The Act has created a fragmented mess, with healthcare leaders trying to work around it. I say to the Secretary of State that it does not need amending—it simply needs consigning to the dustbin of history to be included in the next edition of “The Blunders of Our Governments”.

We will test any new legislation that the Secretary of State brings forward to see if it moves towards greater collaboration—away from a purchaser-provider split model in favour of partnership and planning. Any new legislation should bring an end to the creeping, toxic privatisation of the NHS and instead restore and reinstate a public universal national health service. The Health and Social Care Act has contributed to the reality today where, according to the Department of Health’s own figures, £9 billion is spent on private providers—a doubling in cash terms since 2010. Indeed, we have seen about £25 billion of contracts awarded through the market since the Act came into force.

Of course, there has always been a role for the private sector in providing services, as I said to the hon. Member for East Worthing and Shoreham (Tim Loughton), who is no longer in his place, as indeed there has always been a role for the voluntary and co-operative sector. But the combination of years of underfunding alongside the constant tendering of contracts via the any qualified provider arrangements has led to creeping privatisation. Before Government Members tell us that this is just 8% of the total budget—in fact, the Secretary of State told the House in January that it is “not huge”—let me point out that the problem is that that 8% is located almost exclusively in areas like elective care, community services and patient transport, meaning that the private sector is disproportionately influential in those areas. Moreover, the way in which the funding mechanism works restricts NHS income from those areas and leaves NHS providers picking up the more complex, costly cases—emergencies and the chronic sick. In other words, outsourcing and privatisation is increasingly a false economy where supposed savings are easily outweighed by the costs.

But more importantly than that, privatisation has first and foremost a detrimental impact on patient care.

[Maria Caulfield (Lewes) (Con)]

rose—

[Jonathan Ashworth]

I will give way to the hon. Lady because she is a nurse.

[Maria Caulfield]

Does the hon. Gentleman not agree that the any qualified provider system was brought in under the previous Labour Government in 2009?

[Jonathan Ashworth]

I remind the hon. Lady, whom I greatly respect in this House because of her work in the NHS, that we moved away from that system to a preferred provider mechanism because we knew that the any qualified provider mechanism did not work and was not in the interests of patient care or the interests of the taxpayer.

Let me give some examples. On support services, GPs have warned repeatedly of the dangers of NHS England outsourcing primary care services to Capita, in a contract designed to save £40 million. Those fears proved well founded, as the National Audit Office found that there was a real risk of “serious patient harm” stemming from Capita’s handling of the contract, with major problems around the secure transfer of patient notes, with notes going missing or delivered to the wrong surgery. Capita’s work in providing back-office services such as payment administration, cervical screening tests, medical records and supplies orders had fallen

“well below an acceptable standard.”

On patient transport contracts, I mentioned to the right hon. Member for Mid Sussex (Sir Nicholas Soames) what happened with Coperforma. This was a contract worth £63.5 million.

[Maria Caulfield]

rose—

[Jonathan Ashworth]

And the CCGs are still paying out to Coperforma—is that not correct?

[Maria Caulfield]

With regard to Sussex—I am sure that my right hon. Friend the Member for Mid Sussex (Sir Nicholas Soames) would agree with me—the last time Labour was in government it proposed to close the Princess Royal Hospital in Haywards Heath.

[Jonathan Ashworth]

I am sure that the hon. Lady accepts that it is a scandal that the CCGs—her local health economy—are still paying out to Coperforma. She should be getting up and complaining about that.

What about support services? Interserve was brought in to provide facilities management across 550 NHS buildings across Leicestershire, with a seven-year, £300 million contract. The contract was scrapped four years early because of reports of patients receiving meals up to three hours late, bloodstains in the corridors and bins not emptied. How about Carillion, which won a £200 million, five-year estates and facilities management contract with Nottingham University Hospitals NHS Trust? It failed to clean the hospitals properly, with reports that infectious waste was seen overflowing in the children’s ward.

--- Later in debate ---

[Maria Caulfield (Lewes) (Con)]

I, too, want to use this opportunity to debunk the myth that the Conservative party wants to, or ever has wanted to, privatise the NHS. That is an image that the Labour party wants to portray, but the facts tell a different story. In the 70 years of the NHS, 43 of those years have been under a Conservative Government, so if privatising the NHS were the sole aim of the Conservative party, it would have been done by now. The NHS remains based on the three founding principles of meeting the needs of everyone, being free at the point of use, and being based on clinical need, not ability to pay. However, facts do not often matter to the Labour party.

I was at a meeting at the weekend of more than 200 GPs who were desperate for the politics to be taken out of the NHS. They welcome the Government’s talk of a long-term settlement and of taking the NHS out of the political cycle. That puts fear into the heart of Labour because it would mean that the NHS would come first, not the motives of the Labour party.

If Labour Members were honest with themselves, they would recall the history of the last Labour Government, who did more for privatisation in the NHS than anyone before or since. In 1999, within two years of coming to power, the Labour Government set up market structures in the NHS to create choice and competition, with hospitals starting to charge by price per episode to compete with the private sector. That is Labour’s record on privatisation in the NHS. In 2003, they set up foundation trusts so that hospitals could be free from the constraints of the NHS and run like a business. That is Labour’s record of privatisation in the NHS. Also in 2003, they introduced independent sector treatment centres—private companies set up to provide wholly NHS elective procedures. That is Labour’s record of privatisation in the NHS.

Some 84% of PFI projects were started under Labour. Although they built £11.8 billion-worth of hospitals, the cost to the NHS is £79 billion over 31 years. In 2009, the Labour Government introduced “any qualified provider”, which we have heard about this afternoon, allowing the private sector to undertake NHS work. That is Labour’s true record of privatising the NHS. The King’s Fund analysis on the Labour Government found that by the time they left office, the NHS in England was operating more like a market, with half of elective patients being offered a choice of the private sector. The culture of the NHS had changed from one of collaboration to one of competition.

I am not against the involvement of the private sector in the NHS. As a research nurse, I worked with many multinational pharma companies setting up joint research studies that gave NHS patients access to drugs long before they were available on the NHS and access to equipment that was paid for by pharma companies and left in perpetuity to the NHS.

Labour Members lecture us on privatisation in the NHS, but the last time they were in government, they wanted to close the Princess Royal in Haywards Heath to patients in my constituency. When we were missing Government targets and breast cancer patients were not getting their treatment under the last Labour Government, did they listen to the breast surgeons in my unit who said, “Give us an extra theatre and we can deliver it.”? No, they spent hundreds of thousands of pounds on performance management consultants, time and motion studies, brainstorming sessions and patient pathway mapping. At the end of that six-month process, they told us that the solution was to have more theatre sessions, which the surgeons had told them in the first place.

This is not just my experience; the British public know that the NHS is safe in Conservative hands. That is why, for 43 of the last 70 years, they have put the Conservative party in charge of the NHS, and long may that continue.