Baroness Meacher
To ask Her Majesty’s Government what assessment they have made of NHS England’s management of clinical commissioning group allocations under the current funding formula.
The Parliamentary Under-Secretary of State, Department of Health (Lord Prior of Brampton) (Con)
My Lords, decisions on clinical commissioning group allocations are taken independently of government by NHS England, in order that such an important issue as funding is made objectively and free from perceived political considerations. The Government set some broad principles to which they must conform. NHS England’s decisions are informed by the recommendations of the independent Advisory Committee on Resource Allocation.
Baroness Meacher (CB)
My Lords, I thank the Minister for that reply. As he will know, the Secretary of State is responsible for ensuring that NHS England allocates resources fairly across the NHS. Is the Minister aware that, at present, allocations to clinical commissioning groups are hugely variable in relation to the Treasury manual formula? For example, west London receives 31% more than the formula, while Hounslow receives 9% less than the formula, representing a discrepancy of some £110 million from one trust to another in relation to the formula? Despite some recent improvements, does the Minister share the concern expressed by the National Audit Office about the failure to end this unfairness—and, indeed, even the lack of any timescale within which to rectify this matter? Will he give an assurance to the House that within five years there will be a resolution?
Lord Prior of Brampton
The noble Baroness raises a very important issue. I think that she is raising issues not about the actual formula but about the speed at which NHS England reached the target levels of the formula. She points to the discrepancy of west London, which is 31% over the formula. I can tell her that NHS England is committed by 2017-18 to bringing all those under the formula by more than 5% up to that level. It will also be encouraged to address the issue of CCGs that are above the formula.
Baroness Walmsley (LD)
My Lords, given that the expertise of the CCGs is also very variable, in some areas the commissioning support groups are particularly important. Is the Minister satisfied that both the expertise and the funding of the commissioning support groups is appropriate?
Lord Prior of Brampton
The noble Baroness is right that there is considerable variation in the performance of CCGs and, indeed, commissioning support groups. In an effort to address that variation, we are in discussions with the King’s Fund to publish in a very transparent and open way the performance of individual CCGs.
Lord Hunt of Kings Heath (Lab)
My Lords, the Minister will be aware that the Global Burden of Diseases, Injuries, and Risk Factors Study was published in the Lancet yesterday. It showed that if the south-east of England were a country, it would come top of the 22 most industrialised countries in terms of health outcomes, whereas the north-west would be in the bottom range of countries. Does he accept that in the end this is a ministerial responsibility, and can he explain why allocations to CCGs, last year and this year, put much more money into the south-east of England than into the north-west?
Lord Prior of Brampton
The method of allocation is based around population, demographics and deprivation. The formula has developed over many years. The current formula was developed by the Nuffield Trust. There is no intention in the formula to skew the allocation from one part of the country to another. It is based in an independent and transparent way around population and deprivation.
Baroness Murphy (CB)
Does the Minister agree that the inequity of allocations to CCGs is reflected and made worse in allocations on mental health which, for historical reasons, are very skewed to where there are large hospitals? Not only that, but at the moment it seems that CCGs are not even spending the money that is allocated to them for mental health on mental health but are diverting it to other areas. What is going to be done about this in terms of the fairness of the allocations and the insistence that the money should be spent on what it is intended for?
Lord Prior of Brampton
My Lords, I am not convinced that the method of allocation is unfair. ACRA will soon be reviewing its method of allocation for 2016-17. I repeat that it is an independent process. How CCGs allocate the money they receive to mental health, physical health, public health or anything else is up to them. With the King’s Fund, we are introducing a range of measures to enable us to see how individual CCGs are performing.
Lord Patel (CB)
My Lords, is not the fundamental problem that we have more than 400 commissioning bodies commissioning in different aspects for different services, and that leads to variability? The answer has to be what the Barker commission recommended: a single commissioner that commissions for primary care, community care, acute services and mental health and asks for the outcomes that we need.
Lord Prior of Brampton
The noble Lord makes an interesting and perceptive point. I have no doubt that if we look at the commissioning landscape in five years’ time there will be a lot more integrated commissioning and that social care and healthcare will be much more joined up.
Baroness Walmsley
My Lords, the criteria that the Minister mentioned sound all very well, but they do not take account of existing levels of ill health in the most disadvantaged areas of the country. The criteria he quoted do not take account of the need for catch-up for those populations.
Lord Prior of Brampton
The report by the Public Accounts Committee raised the issue of whether deprivation was properly taken into account by the formula used by ACRA, and ACRA has agreed that in its new formulation it will look again at the adjustment it makes to the formula for deprivation.