National Health Service

Lord Horam Excerpts

Thursday 8th January 2015 Lords Chamber

[Lord Horam (Con)]

My Lords, I think we are all very grateful to the noble Lord, Lord Turnberg, for initiating this debate. Obviously, it could not be more timely. He may recall that he and I first met when he was president of the Royal College of Physicians and I was a Minister at the Department of Health. Even then, we had the same post-Christmas problems—we may also be taking the same pills, for all I know, but I will not speculate on that.

I will put forward two particularly positive points as we review the situation, which is obviously worrying, and the longer term situation, which the noble Lord wants us to address. The first is that the NHS remains a good and a tried and trusted model for the delivery of healthcare. If you look around the world, it is very difficult to find one that is better as regards value for money and quality—although we know that there are gaps. It is also, as my noble friend Lord Howe pointed out in his Statement yesterday on the winter problems, remarkably flexible when it needs to be. We see that a number of hospital trusts are coping with these sudden increases in demand in a very innovative and sensible way.

The second positive point I will make is that there is wide consensus—although one would not think so in the political debate that is going on—over the way the NHS should evolve. I will concentrate in my short remarks on the Five Year Forward View, which was produced by Simon Stevens, the chief executive of the National Health Service England, in October last year. That has received general support from all sides of politics, and it was both realistic and sensible. However, the conclusions it reached have been underplayed. The central conclusions Simon Stevens points out in his report’s final two paragraphs are that even if funds remain broadly flat in real-terms increases—and in fact, despite what the noble Lord, Lord Turnberg, said, spending on the National Health Service and on health in this country as a whole has more than doubled in real terms since I was a Minister back in 1997—and if the service continues its annual increases in efficiency of 0.8% a year, which is not a huge annual increase, the £30 billion gap which he envisages by 2020 would reduce to £21 billion. If the increase in efficiency was doubled to 1.5% every year—again, not a huge increase—it would reduce that £30 billion gap to £16 billion. If efficiency could be increased to 2% to 3%, which is quite normal in other industries and services, the funding gap would be almost wholly eliminated and we would be able to reach the nirvana of a continuingly progressive and successful health service.

In that context, I make one suggestion to my noble friend Lord Howe. We know that many hospital beds are occupied by people who do not need to be there, who do not need acute care any longer, and who could be in a recovery situation or intermediate care elsewhere. It is the fact that many housing associations and mental health trusts have been lobbying hospital trusts up and down the country, asking to provide intermediate and recovery units for them, so they can transfer patients from acute services into those intermediate or recovery services. I noticed on the BBC last night that a trawl had been done of where the problems were; a spokesman for Addenbrooke’s Hospital in Cambridge said that 20% of its beds were occupied at this moment by people who could be cared for in a recovery unit or in another form of intermediate care. But the housing associations and mental health trusts are finding that, although very often the chairman and CEOs of hospital trusts are glad to have this support, it is simply impossible to get decisions. The noble Lord, Lord Turnberg, pointed out that among other things it is very difficult and slow to get decisions through the bureaucracy of even the trusts themselves, let alone the overall NHS, and this is causing a real problem.

I hope that my noble friend Lord Howe will look at this issue, where there could be an immediate improvement, within a matter of months, in the number of facilities being taken up by people who do not need to be in hospitals. It would save the capital costs, because housing associations would pay for them out of their own capital funds. It would also save current costs, because an NHS bed costs £2,000 a week to maintain. The housing associations tell me that they could do it for less than £1,000 a week, halving the current costs as well as providing capital money for the NHS. So there is an example of where efficiency savings could be made in a very short space of time. We are talking about months or even a year or two.

Simon Stevens’s conclusion, following the final two paragraphs of his report, was that,

“nothing in the analysis above suggests continuing with a comprehensive tax-funded NHS is intrinsically undoable”.

I believe that to be correct and right, but we will achieve that only if the trusts up and down the country stop being just administered and manage the resources, using the funds available to them properly.