Health and Social Care

Meg Hillier Excerpts

Monday 27th February 2017 Commons Chamber

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

May I pay tribute to the Chair of the Health Committee for her sterling work in this area and to the Chair of the Communities and Local Government Committee? Our three Committees are united in the view that we need to bring the agenda of how we fund health and social care to the front and centre of this House and this Government. It is important that we work together on that. It is quite unusual for three Select Committees to co-ordinate in such an effective way—at least we hope it is effective. Ultimately, the proof will be whether this view will bite with Government.

We are clear that integration of health and social care is vital. In fact, we rushed to the Chamber from Committee Room 6 where we were debating the first phase of the better care fund, which had been used as a way of taking health money to prop up the social care budget. Amazingly, the head of NHS England and the Department of Health, who were appearing in front of us, denied that there was any failure in the better care fund. They said that there were not really any targets; it was all about taking money from one pot to pay for another. If that does not underline the challenges that exist in the many initiatives that are coming forward and the lack of sustainability for long-term funding, I do not know what does. I echo the comments of the Chair of the Health Committee that we need a long-term generational shift in how we are going to deal with this matter. We cannot just keep lurching from crisis to crisis and funding situation to funding situation.

My Committee looks very closely at accounts for many Members of this House. It may not be the most enjoyable bedtime reading, but we lap up the accounts of different Government Departments. We were disappointed that the Secretary of State laid the NHS accounts on the last day of the parliamentary term in July. When we opened them, we realised why: those NHS accounts were within target only by a smoke and mirrors approach and a series of short-term, one-off measures to ensure that they balanced.

I remind the Under-Secretary of State for Health, the hon. Member for Warrington South (David Mowat), that last year the Public Accounts Committee, of which he is a former member and therefore is doubly thoughtful on this subject, gave the Department a yellow card warning that, if in 2016-17, these similar one-off measures and a similar approach to the Budget were carried forward, we would be giving it a red card. The Comptroller and Auditor General, Sir Amyas Morse, issued an unprecedented warning in those accounts, which had been audited by the National Audit Office, and laid out his serious concerns. As he told us, he walked down Whitehall to talk to the permanent secretary at the Department of Health to make it clear that he was concerned about those one-off measures.

To help the House, I will lay out how it was that, by some miracle, the Department managed to balance its books last year. First, £2.14 billion was set aside for sustainability and transformation funding, £1.8 billion of which was used to cover hospital trust deficits. The Department of Health did not notify the Treasury of the additional £417 million of national insurance receipts that it had received. It said that it was just a one-off reporting error. I am heartened to see that, in the current estimates, such a practice does not recur.

There was also a one-off super dividend of £100 million for the Department from the Medicines and Healthcare Products Regulatory Agency. That large cash balance was put into its capital departmental expenditure limit budget, which helped it to reach a final balance. Critically, it seems that this is becoming a long-term strategy for NHS budgeting—I hope the Minister will take this seriously and respond. As the Chair of the Health Committee has highlighted, we are seeing a trend of capital funding being pushed into revenue to keep the system going. That is not sustainable. Last year, in 2015-16, the Department of Health transferred £950 million of capital to revenue. The supplementary estimate that we are debating tonight shows that the Department will transfer some £1.2 billion of capital to revenue funding this year—so £250 million more than last year.

[Bill Wiggin]

I am particularly interested in the private finance initiative element of the capital funding, because certainly, for all the years that I have been a Member of Parliament, the PFI burden on Hereford hospital has always held it back. Has the hon. Lady’s Committee had a chance to look at that?

[Meg Hillier]

We have not looked at that directly, but we know that the biggest revenue cost for hospitals is staffing, which is followed, for some hospitals, by servicing a PFI deal. Early analysis suggests—I would not want the House to lay too much on this, because it comes from conversations I have had with auditors—that the challenge is that the cost of refinancing those PFI deals can swamp the potential savings. Perhaps Ministers could look into that further. A lot of technical work has been done to attempt it. The British Medical Association tells me that spreading the payback period over a longer time would reduce the day-to-day resource costs for hospitals, so that might be a way forward. However, I speak from work I have done outside the Committee Room, rather than strictly through the work of the Public Accounts Committee and the National Audit Office.

The supplementary estimate this year is worrying. The trend is going in the wrong direction for taking money out of the capital spend. As the hon. Member for North Herefordshire (Bill Wiggin) highlighted, a lot of the transformation in the NHS will require the reconfiguration of buildings and estate. Those sorts of capital expenditures are important to save money in the long term, so the estimate really is very short-sighted.

If we look at how NHS trusts are managing with their deficits, again we see a worrying trend. At the beginning of this financial year—2016-17—NHS Improvement committed to ensuring that the provider sector deficit did not exceed £580 million at the end of the year, which is now in a month’s time. However, NHS Improvement forecast a deficit of £644 million in quarter one. Its forecast declined further to a deficit of £873 million in quarter three. That pledge did not amount to very much, and it is moving very much in the wrong direction. NHS trusts have been overspending by approximately £300 million a quarter throughout this financial year. If that trend continues into the final quarter of the year, the overspend will be close to £1.2 billion. I have laid out the reality very starkly by picking out uncertain elements in the Department of Health’s consolidated accounts.

We hear a lot of discussion about how much money the Government are putting into the NHS. The Committee had an unedifying experience at a hearing on 11 January, in which the head of NHS England came before us on the very day that anonymous briefings in the national press from sources at No. 10 criticised him and NHS England. He defended his position in the Committee but, frankly, patients do not want anonymous briefings from people to save face when the Committee is actually looking at saving lives and treating patients. They do not want to see a ding-doing about the money. They need to know that the people running our health service, and the Government overseeing and channelling taxpayers’ money into it, are committed to long-term patient care and tackling future long-term challenges.

Let us be clear that protecting the NHS England budget is not the same as protecting the health budget. As the hon. Member for Totnes mentioned, Public Health England and Health Education England are being squeezed, and social care budgets—although not a direct national health cost—went down by 10% in the last Parliament. There are some clever measures by Ministers, saying, “Put up your council tax precept and it’ll all be fine.” That is still taxpayers’ money being found from somewhere to go some way towards solving the problem, but it will not solve it in the long term. Unless we tackle social care and health together, we will have an unsustainable future. There is too much robbing Paul to pay Paul—shifting money from one bit of the budget to another in a clever way that is not transparent to most people out there because it is buried in big numbers.

[Seema Malhotra (Feltham and Heston) (Lab/Co-op)]

My hon. Friend is making a thoughtful and evidence-rich speech, as always. One issue that is not often talked about, but that appeared in the media again today, is the rise in physical attacks on NHS staff. The budget of NHS Protect, which deals with a lot of security issues, is also being cut. That is part of creating the perfect storm, with evidence that a lot of perpetrators of such attacks are those with mental health issues. Unless we have the resources for an environment in which we keep NHS staff safe, the issue could get worse.

[Meg Hillier]

My hon. Friend makes her point well. It is important to protect staff. I echo the comments of the Chair of the Health Committee that staff cost more than anything else in the NHS and provide the direct patient care that is so important to its long-term sustainability. I will touch on workforce planning in a moment.

[Mr Jim Cunningham]

There is another dimension, which is that some people with mental health problems turn up at A&E units because there is no other place for them to go and they cannot get any other accommodation. The views and voices of the carers who look after these people are very often not listened to. I get many complaints about that.

[Meg Hillier]

That is one reason that we need to be really clear that we are looking at a long-term integrated health and social care system. Social services support should be there for people—whether they are a frail older person, someone with a particular disability and need, or someone with a mental health challenge—when they need it to prevent them from going to A&E in the first place.

[Rachael Maskell (York Central) (Lab/Co-op)]

Will my hon. Friend give way?

[Meg Hillier]

I will, but I will then make some progress.

[Rachael Maskell]

I thank my hon. Friend for her excellent speech. I am disturbed when I hear that the Government are putting more money into mental health, yet I have just received the figures on Vale of York CCG mental health funding, which will be cut in the next financial year. The budget is dropping from £46 million to £45 million next year in a city that has real challenges around mental health, which shows that services are not catching up with what the Government insist is trickling down into the system.

[Meg Hillier]

My hon. Friend puts a face on the real challenge faced by many trusts and commissioners: they are having to make choices about where to spend the money. Despite the pledges about parity of esteem, there is a squeeze on mental health funding nationally.

The reality of the overall picture is that growing demand is outstripping the ability of the NHS to supply needs, which is having a direct impact on patients. There are now longer waiting times for GP appointments. I alert colleagues to the Public Accounts Committee’s hearing on GP services next week; any thoughts from hon. Members’ areas are welcome. People are waiting longer to see specialists, with the 16-week target being breached, and A&E targets are being breached too often. There is a real challenge.

NHS Improvement is a welcome body for trying to encourage best practice, because there is regional variation. It is quite right that any body as large and expensive to taxpayers as the NHS looks to perform as efficiently as possible but, once again, we are seeing NHS Improvement mask what look like cuts. A 4% efficiency savings target is once again being imposed. It was imposed in the previous Parliament by the then Chancellor, the right hon. Member for Tatton (Mr Osborne), and was acknowledged by the head of NHS Improvement, Jim Mackey, as particularly challenging. Worryingly, the reality was that everyone in the system knew that the target was too challenging, but there is a real lack of a culture of whistleblowing and calling it out in the NHS. It is difficult for people to speak truth to power, as we see over and over again. The head of NHS Improvement again acknowledged to our Committee recently, as mentioned in our report, which was published today, that the 4% efficiency savings required as part of the transformation programme are “challenging.”

Our report also describes a worrying correlation between the financial performance of trusts and their Care Quality Commission ratings, stating:

“Trusts that achieved lower quality ratings had poorer average financial performance, and the 14 trusts rated ‘inadequate’ together had a net deficit equal to 10.4% of their total income in 2015-16.”

That is a real issue.

I will touch on workforce planning before beginning to draw my comments to a close. We hear a lot about the cost of locums. Very often in the national debate, I worry that we fixate on smaller issues when we really need to look at the bigger picture. We often hear about the very high rates per hour or per day paid to individual locums. That certainly is a problem—paying someone several thousand pounds a day or a shift seems ludicrous—but the key issue is the sheer volume of locums needed.

Each year, the trust structures are set to meet the budget sent down to them from the Department of Health—our tax money, but not enough of it. From the beginning, they are just not set up well enough to meet demand. Trusts have to buy in locums to meet the needs of their populations, but that is not sustainable in the long term. There were challenges, with a reduction in the number of nursing places in the last Parliament, which is coming through now. We have recently seen the loss of the nursing bursary, which we hope does not mean a reduction in the number of nurses in the future. However, many women, particularly lone parents, in my constituency welcome the opportunity to better themselves and contribute to our NHS by taking that on. I hope the Minister will give us an update on the numbers of people going into nursing training now and, crucially, on whether the people taking those training places will stay and work in our NHS, especially given Brexit and immigration issues.

[Mrs Anne-Marie Trevelyan (Berwick-upon-Tweed) (Con)]

My local foundation trust, Northumbria NHS Trust, has taken to training its own cohort of nurses so that local people who want to join the nursing profession will be able to do so knowing that they will be able to work in that local trust, which has a great reputation and which is leading the way on the financial and medical changes we need to see.

[Meg Hillier]

I agree with the hon. Lady. My own hospital does the same, taking on healthcare assistants and bringing them up through the system. The challenge is: how many people will be put off without that bursary payment? We need a clear answer from the Minister about what analysis was done of the impact on the workforce of that change. The amount of money involved is relatively small compared with the challenges and problems of not being able to provide a health service if we do not have enough nurses.

[Helen Goodman]

False economy.

[Meg Hillier]

It may well be, as my hon. Friend says, a false economy.

[Dr Philippa Whitford (Central Ayrshire) (SNP)]

The early figures that have come out from NHS England suggest a 23% drop in applications. Obviously, that is a significant change.

[Meg Hillier]

The key thing, of course, is how that figure comes through the pipeline and how we fill the gap. While the Minister is on his feet at the end of the debate, it would be helpful if he said what analysis the Department of Health has done of the impact of Brexit and any changes it may herald for our NHS workforce, because a high percentage of them are from Europe. We are hearing the right sounds from the Government, but we have not yet had any action on securing the future of those European citizens currently resident in the UK. If the Minister is able to give us any comfort on that, it would be very welcome.

I am heartened that so many Members are in the Chamber to discuss this important issue. I should mention that the Public Accounts Committee has also been working with the Procedure Committee to try to ensure that the House can discuss the financial details of estimates rather than just the general principles, although I have obviously strayed into those, too. Hopefully, we can base these debates on the figures we have spent so much time looking at in the Public Accounts Committee. It is unedifying for the public to hear anonymous briefings and public argument; that does not wash with them. We need to be on top of this issue so that we hold the Government’s feet to the fire and make sure that, every step of the way, they know we are watching the budget. We will not let you get away, Minister, with raiding the capital budget to fund the accounts this year.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

The hon. Lady is making a very interesting speech. One thing we should make much greater use of is pharmacies, especially to try to take some of the pressure off GPs. We should also ask GPs to go into pharmacies and to be located in them.

[Meg Hillier]

The hon. Gentleman makes a good point, and I visited one of my local pharmacies only a few weeks ago and saw at first hand the work it does to help ease the pressure on GPs, where people are waiting a long time for appointments, and on A&E. The Minister has taken a keen interest in pharmacies, but there is nevertheless a cut to their base budget. While we are on that point, it is interesting to note that that base amount allowed them to have the certainty to employ a member of staff to conduct appointments directly with patients. If they rely just on the revenue income they get from selling products, they cannot be sure that they can maintain that salary every year. That solid base of funding was important in a constituency such as mine, where, for all sorts of reasons—culture, language and convenience—people often find their local pharmacy more readily than they do their GP practice, and they find it very useful. The Minister therefore has questions to answer on that point as well.

A cross-party group of us recently met the Prime Minister, and I was heartened that she at least acknowledged the need to look at the long-term issues around health and social care. She has made a pledge that her adviser at No. 10 Downing Street will meet a cross-party group of MPs to discuss this issue further. I hope that heralds a change of attitude in the Government that will see no more anonymous briefing and silly bickering, but a strong, concerted effort to make sure that we future-proof our NHS for us and our children and that it is the beacon to the world that we all believe it is.

[Several hon. Members rose—]

--- Later in debate ---

[Meg Hillier]

I was going to say that this had been a good-natured and thoughtful debate. It is a shame that a Minister who is usually thoughtful has resorted to seemingly blaming NHS England for the present situation. I think it important to be clear about the budgetary position: NHS England asked for a certain amount of money, which the Government have stretched over an extra year. Money that was meant to cover five years has actually covered six, and I think it important to put that on the record.

Members of all parties have made it clear that there are long-term financial challenges to our health system, and that we must have a long-term national debate about how we are to fund a health service that is fit for the 21st century. Last year, a series of one-off extraordinary measures allowed the accounts—just about—to balance, but today Members on both sides of the House have drawn attention to the movement of the departmental expenditure limit from the capital to the resource side of the budget. According to the estimate, the limit is projected to increase to £1.2 billion. An awful lot of money is being taken out of the long-term future of the NHS to pay for day-to-day problems. That is not sustainable, and it is a great shame that the Minister did not address it. I hope that the Government will view it as one symptom of the long-term challenges of funding.

This sticking-plaster will not solve the problem, but I hope that we can move forward on a cross-party basis, despite the Minister’s final comments.

Question deferred until tomorrow at Seven o’clock (Standing Order No. 54).