Privatisation of NHS Services

Mike Hill Excerpts

Monday 23rd April 2018 Westminster Hall

[Mike Hill (Hartlepool) (Lab)]

I beg to move,

That this House has considered e-petition 205106 relating to the privatisation of NHS services.

It is an honour to serve under your chairmanship, Sir Graham. I pay tribute to a young constituent of mine, Connor McDade, whose father, John, is a friend and a former work colleague. Connor was run over in Newcastle last weekend, but despite the most excellent care provided by NHS staff in the critical care unit at the Royal Victoria Infirmary in Newcastle, his life support was switched off yesterday. On 14 May, he would have been 22. He passed in the early hours of this morning. The standard of care delivered by staff at the RVI was second to none, so it is fitting that I pay tribute to them and all hard-working NHS staff at the beginning of my speech.

Privatisation in the NHS is not new. When the NHS was founded in 1948, agreements had to be thrashed out with GPs, doctors and consultants to allow private practice to continue and sit alongside the new national health service. Private healthcare insurance has been around for longer than the NHS. The British United Provident Association—BUPA—was founded in 1947, and it currently has about 15.5 million health insurance customers and 14.5 million people in its private clinics and hospitals.

The NHS itself has always had a private treatment offer, although between 1974 and 1976, Barbara Castle, the Labour Secretary of State for Social Services, campaigned to abolish pay beds in the NHS. That was achieved after her tenure in 1977, but the Tories repealed it three years later in the Health Services Act 1980. On abolishing pay beds and separating out private and NHS facilities, Mrs Castle said:

“The existence of pay beds, with the opportunity it gives to a few senior doctors to make private gain and the opportunity it gives to patients with money to jump the queue, is seen as a bitter affront to those thousands of other staff who are dedicated to the principle of a free Health Service.”—[Official Report, 21 November 1975; Vol. 901, c. 355.]

Tens of thousands of health workers, citizens and patients would echo that opinion today. It is also the opinion of the British Medical Association, which believes that the NHS should always be free at the point of use and has campaigned for many years to halt the spread of privatisation. Its focus is not just on private practice, but on private provision—the privatisation of services, commissioning and procurement.

It is worth noting that, on private practice or healthcare provision, an update to the BMA’s 2016 report entitled “Privatisation and independent sector provision in the NHS” shows that in recent years, the number of NHS patients treated in private hospitals has increased substantially. In 2015-16 alone there were 557,200 admissions—an increase of 8%—and in the same period 5% of NHS-funded elective surgical admissions were to independent sector facilities.

[Thelma Walker (Colne Valley) (Lab)]

We are witnessing the fundamental dismantling of the NHS and creeping privatisation, which is undermining its dedicated, hard-working staff. Does my hon. Friend agree that we need to halt all privatisation and legislate against the selling-off of our world-renowned health service?

[Mike Hill]

As a member of the Petitions Committee, I am independent; as a Labour MP, I agree. I will come to that point later.

Private practice is only one aspect of the worrying trend towards the increased privatisation of NHS services. As the BMA points out, the recent legal action that Virgin Care brought against several clinical commissioning groups should serve as a stark reminder of what can happen when the relationship between the NHS and the private sector sours.

[Paula Sherriff (Dewsbury) (Lab)]

My hon. Friend is being very generous in giving way. Many Members know that I worked in the NHS for more than 10 years. That service was privatised and taken on by Virgin Care, which destroyed it. What concerns me is that I have given Conservative Health Ministers, including the Secretary of State, the opportunity to talk to me on a number of occasions about Virgin Care’s many failings, some of which were very dangerous, but they have never taken up that opportunity. Does my hon. Friend share my concern?

[Mike Hill]

I certainly do share my hon. Friend’s concern. Ironically, in my patch, sexual health services are delivered by Virgin doctors.

[John Spellar (Warley) (Lab)]

Is it not the case, as the two previous examples show, that we are not comparing like with like? The supposed savings are actually achieved by an immediate reduction in service or by the service becoming unviable, which means that the Government have to pick up the pieces. If anything goes wrong with a private healthcare operation, the patient has to go into the national health service, which has to bear the burden.

[Mike Hill]

I entirely agree. The forecasts for the next three years indicate that £10 billion-worth of NHS work will go to the private sector.

A settlement reported to be in the region of £330,000 was paid to Virgin Care in December 2017, following a procurement process in which an alliance between a foundation trust and local social enterprises won a contract to provide children’s services across Surrey. Such interventions and the ability of private companies to challenge NHS procurement provisions are precisely why there are fears about the transatlantic trade and investment partnership—a proposed trade agreement between the European Union and the United States. Many fear that our separate post-Brexit trade agreements with the United States will mean that NHS services will be exposed to the competition and might of the American private care market.

[Laura Smith (Crewe and Nantwich) (Lab)]

Hundreds of my constituents in Crewe and Nantwich signed this petition because they want their Government to put people before profit. Fourteen hospital trusts have had to trigger emergency contingency plans and delay hospital building because of the collapse of Carillion earlier this year. Given that Capita’s annual losses are rocketing, does my hon. Friend agree that the Government’s response shows that they remain dangerously obsessed with privatisation in our NHS?

[Mike Hill]

I agree. As I said, it is estimated that, over the next three years, up to £10 billion-worth of NHS contracts will go to the private sector, including the provider that my hon. Friend mentions.

Are such fears irrational or are people right to be concerned about the privatisation of NHS services, given the fact that the influence of private healthcare providers has risen sharply in recent decades? The use of the private sector has been progressed by successive Governments over many years. The present Government blame Labour for introducing private finance initiatives, which they say have burdened the NHS with eye-watering debts, but the Government compounded the problem through PF2. They also blame Labour for opening up the NHS to marketisation by splitting primary care trusts into commissioning and provider arms, and introducing the concept of “any preferred provider” in its transforming community services programme, even though the Secretary of State at the time, Andy Burnham, expressly stated that the NHS would always be the preferred provider of services. Yet from 2010 onwards this Government extended that model, creating clinical commissioning groups and pursuing competition and commercialisation with renewed vigour. Today, therefore, many traditional public health services are run by private providers such as Virgin Care and GP consortiums in their own right—services such as out-of-hours urgent care, sexual health and mental health residential care.

The Health and Social Care Act 2012 was designed to bring in a far greater private sector element to the NHS through expansion of the internal market. Since then, the privatisation picture has been more mixed than had been feared, not only as a result of campaigns by Unison, the GMB and others, but because various Government initiatives to boost privatisation fell flat. However, there is still significant evidence of increasing privatisation, with companies such as Virgin, Serco and Spire continuing to prosper.

[John Spellar]

My hon. Friend mentioned the care sector. Is there not a fundamental flaw in that sector, because it is based on offshore location of ownership of the assets and on heavy leveraging and gearing of the companies? That has meant that many of them are on the brink of bankruptcy, and they seek either to be bailed out or to throw many thousands of very vulnerable and elderly people straight back to the Department of Health and Social Care. The Government have no real plan, as far as we can see, to deal with such a contingency.

[Mike Hill]

My right hon. Friend makes an important point about social care. In fact, some private providers have drifted away from healthcare contracts because of the losses that they might make on them.

[Paula Sherriff]

Will my hon. Friend give way one more time?

[Mike Hill]

One more time.

[Paula Sherriff]

I want to be clear about some of the dangers of privatisation. When Virgin Care took over our dermatology service, it would not subscribe to the SystmOne computer system, so we had to use another system, which was not operable for more than a year. Patients were coming in, but we had no idea what they were coming in for—we had to ask them questions such as, “Is the lesion on your left or right arm, or on your leg?” That is particularly difficult with patients who have dementia or learning difficulties, for example, and it represents a significant hazard to patient safety.

[Mike Hill]

I am glad that my hon. Friend mentioned such issues, and dementia in particular—mental health care needs to be looked at for investment.

[Mr George Howarth (Knowsley) (Lab)]

Will my hon. Friend give way? I know he has just said, “One more time”, but perhaps he will make it two.

[Mike Hill]

I am on my last two paragraphs, but I will give way to my right hon. Friend.

[Mr Howarth]

I am grateful to my hon. Friend. He has made a powerful case for how it is wrong in principle to privatise the national health service, and he has alluded to comparisons with the social care sector. Is not one of the major risks the fact that private sector provision sometimes fails—the business fails—so there is a complete and, in the short term, irreplaceable loss of capacity in the healthcare categories catered for by such a company?

[Mike Hill]

I cannot disagree with such a well made point.

The impact of austerity has been a double-edged sword, according to the union Unison. On one hand, less money can be made from the NHS, so some firms have shrunk away. On the other hand, the NHS has opted increasingly for short-term fixes as it struggles with insufficient funding, and that has created opportunities for the private sector. For example, the Carter review includes the threat that hospitals that cannot make sufficient savings in their support services or pathology functions might have to use outsourcing instead. Most recently, the development of wholly owned subsidiary companies has brought a whole new set of fears for the NHS, and for health staff in particular.

The old fears from the 1980s and 1990s are beginning to resurface. When we add social care into the mix, those fears multiply. The NHS is one of our proudest achievements, and we need to protect it, not privatise it. To do so, we need to revoke section 75 of the Health and Social Care Act.

--- Later in debate ---

[Mike Hill]

I thank all hon. Members for their powerful contributions, and I thank the petitioners, whose numbers helped to secure this important debate.

Question put and agreed to.

Resolved,

That this House has considered e-petition 205106 relating to the privatisation of NHS services.

Sitting adjourned.