NHS White Paper

Andrew George Excerpts

Monday 12th July 2010 Commons Chamber

[Mr Lansley]

I have not been briefing anything to anybody. [Interruption.] I have not. It is very straightforward. The FSA, along with other bodies associated with our public health responsibilities, will be the subject of a public health White Paper in the autumn. There is no proposal.

[Andrew George (St Ives) (LD)]

In seeking to reassure the House that this is not the top-down reorganisation that the coalition agreement derided, would my right hon. colleague reassure my constituents, who are quite excited by the idea of more patient and local authority involvement in local decision making, that where the primary care trusts in which they are going to be appointed will be abolished, there will be more GP commissioning groups than PCTs at the end of the process?

[Mr Lansley]

Yes, I am grateful to the hon. Gentleman. The number of GP-commissioning consortiums will be determined not least by GPs themselves, deciding what makes sense in their locality. He and his Cornish colleagues have often been frustrated by the way in which a top-down bureaucracy has sought to dictate to the people of Cornwall, often in specific localities, at a considerable distance from their hospital services, what services should be provided locally in places such as Hayle and Penzance. He and his constituents can be really comforted by the thought that their clinical advisers and general practitioners in local consortiums can in future make those decisions about their services.

NHS (Cornwall)

Andrew George Excerpts

Monday 12th July 2010 Commons Chamber

[Sarah Newton (Truro and Falmouth) (Con)]

I am delighted to have this opportunity of welcoming the publication today of the coalition Government’s health White Paper, “Liberating the NHS”. It received a warm welcome in Cornwall this evening during the evening news on the BBC, with support from patient groups and GPs. I believe that making the NHS more accountable to patients and freeing staff from excessive bureaucracy and top-down control will drive up quality of care and outcomes for patients. I also welcome the measured pace of change and the Government’s desire to engage in a wide range of consultations to get the detail of the proposals working for the benefit of patients.

This evening, I would like to describe the current situation and direction of travel of the NHS in Cornwall, and to raise one important aspect outlined in “Liberating the NHS” today: assuring the continued improvement in quality of care in Cornwall. In addition to the ambulance service, we have three organisations that commission or provide care for people in Cornwall: the Royal Cornwall Hospitals NHS Trust, the Cornwall Partnership NHS Foundation Trust, and the Cornwall and Isles of Scilly primary care trust. There have been significant problems with some aspects of the quality of care provided by those organisations, but over the past three to four years improvements have been made. Significant challenges remain, and it is essential that momentum be maintained in the further improvement from ratings of “adequate” and “fair” to “good”, and then sustained at that level.

The Royal Cornwall Hospitals NHS Trust annual health check ratings demonstrate some steady improvement. Areas that needed work were governance, financial management, infection control and elderly care. The quality of service was rated “weak”, and remained weak until 2008-09. However, more recently the trust has demonstrated overall improvement through the interim core standards declaration in October 2009. The trust was registered under the Health and Social Care Act 2008 in April 2010 without conditions and with only minor concerns. The overall annual health check ratings of the Cornwall Partnership NHS Foundation Trust demonstrate improvement in performance, particularly since the high-profile investigation of services for people with a learning disability. In 2005-06, the trust’s quality of service was rated weak, improving to good in 2007-08, and that improvement was sustained into 2008-09. Its quality of financial management similarly improved. The trust was registered without conditions under the 2008 Act in April 2010, and achieved foundation status on 1 March 2010.

The Cornwall and Isles of Scilly PCT has also seen some improvement in performance. In 2006-07, its quality of commissioning was rated fair, improving to good in 2007-08 and then returning to fair in 2008-09, and its quality of financial management is improving to good. The trust was also registered without condition, however this was with a moderate level of concern.

Also of relevance to all three Cornwall NHS trusts is the report on the inspection of safeguarding and looked-after children’s services published by Ofsted on 23 October 2009. Out of 16 outcomes, Cornwall council was awarded only one score of “good”—there were six of “adequate” and nine of “inadequate”. Although most issues for action are for the local authority, there were also issues for the health community to address, which involve all three NHS trusts to a greater or lesser degree. Action plans are in place, and oversight and scrutiny of the health element is provided by the South West Strategic Health Authority. It is performance-managing progress on delivery of the action plan weekly and bi-monthly, alongside an improvement board, which has been established.

At such an important time, when Cornwall’s NHS trusts are working hard to improve the quality of care, which they need to deliver for Cornwall, it is essential that momentum is not lost. The regulation of the quality of care is vital to patient confidence. The ability of patients and clinicians to access information about the quality of services provided, as well as their being able to feed in information to the inspection and regulation regime, is very important. With the abolition of many centrally imposed targets and more devolved target setting and commissioning, the regulation and inspection of the quality of commissioning will need to adapt to this new environment. Many local factors are important to health outcomes in Cornwall, such as access to services, and those will be able to be taken into consideration. There is also an opportunity to invite the greater involvement of patient and clinical experience of services into the regulation and inspection regime.

The information provided to patients must embrace all that goes on to make up quality, including access, waiting times, cleanliness, infection rates, quality of clinical care, results for patients, access to same-sex accommodation and single rooms, cancelled operations, emergency readmissions, discharge arrangements, numbers of complaints, patient experience and patient-reported outcomes. Most of those data already exist, but they are difficult to access for many people. An open attitude to acknowledging and acting upon criticism is also needed to drive up the quality of care. If we had an open information culture, the scandalous failings that took place in Maidstone and Tunbridge Wells and then at Stafford hospital would not have gone unchallenged.

I am concerned by the number of clinicians in the NHS in Cornwall who tell me that when they challenge their manager and try to improve a service for patients they are told, “Nothing can be done”, “There’s no point saying anything as nothing will change” and, “Don’t ask, don’t tell, don’t complain”. At Mid Staffs there was clearly a sense among some of the professionals, and indeed the public, that the hospital had problems, but that was just the way things were done. That is just not good enough. We should never allow that sort of thing to happen again.

[Andrew George (St Ives) (LD)]

My hon. Friend is making a good point, particularly about whistleblowers in the NHS. It is vital that they are treated seriously and not threatened or bullied as a result of their whistleblowing.

Within the coalition agreement, to return to the role of patients and the local community, there was a commitment to a strong voice for patients locally through directly elected individuals on the boards of local primary care trusts, with the other members being representatives from the local authorities. However, those PCTs will be abolished. Does my hon. Friend agree that in Cornwall we need to ensure that there is some democratic accountability and community representation in the overview, scrutiny and management of the local NHS?

[Sarah Newton]

I thank my hon. Friend for that comment and I am sure that when the Minister replies he will describe some of the proposals in the White Paper to give local authorities and representatives far greater involvement in the overview and scrutiny of health services.

Instead of whistleblowing being seen as going outside the organisation, we should see such challenges as integral to safety and improvement within the organisation. In April 2009, John Watkinson was dismissed from his role as chief executive of the Royal Cornwall Hospitals NHS Trust. He took his case to an employment tribunal, which has published its judgment that he was unfairly dismissed. In the opinion of the tribunal, he was unfairly dismissed because he made a “protected disclosure” covered by the Public Interest Disclosure Act 1998. The disclosure was linked to the reconfiguration of upper gastro-intestinal services in Cornwall. The tribunal also found that the trust acted as it did as a result of pressure from the South West strategic health authority. Verita, a specialist company that conducts independent investigations, reviews and inquiries, has been commissioned to undertake a review and will report later this year. With a different culture in the NHS, this difficult situation might well have been avoided.

In the same way, instead of seeing complaints as a burden, distraction or something to be dealt with outside mainstream service provision, we must see them as integral to the improvement of the service that we provide. Learning from our mistakes, listening to complaints, comparing what we do, evaluating our performance and constantly seeking to improve quality are the features of the best performing organisations in every sector, and they can be already found in the best performing NHS trusts.

Listening to patients—asking, reporting and learning from patient experience—will be of great importance in designing and improving services, including achieving greater efficiency. However, the NHS too often asks insufficiently penetrating questions, insufficiently frequently, of too few patients. The NHS patient survey, which asks whether patients are satisfied with the care they received, is too much like asking patients if they are grateful.

I have read with interest the section in the White Paper entitled, “Autonomy, accountability and democratic legitimacy”. It sets out the outline of the proposed registration, evaluation and inspection regime. The Care Quality Commission process is new and generally thought to have made a good start in Cornwall, and I am pleased to see that it has an extended role in regulating quality of care.

Given the important stage that the NHS trusts have reached in Cornwall, assistance from those aiding the improvements that have already been identified in action plans needs to continue. As a result, I want to understand what plans the Minister has to develop the regulation and inspection of care providers and commissioners to ensure that standards of health care and the confidence of clinicians and patients in that care are improved. What is the time frame for migrating from the current regime to the new one and who will be involved in the consultation process for the creation of the new regime?

--- Later in debate ---

[Andrew George]

I am grateful to the Minister for his response. As he says, things have moved on in a few weeks on the commitment directly to elect PCT boards, but a vacuum has been left, and not just in Cornwall, because we must make sure that finances are adequate for future need and because the local community cannot be represented through the GP commissioning boards. It needs a role in the shaping of services.

[Mr Burns]

I am extremely grateful to my hon. colleague. As he reads the White Paper in conjunction with other documents that will flow from it in the next few weeks, he will come to understand that all the pieces are in place to deal with the concerns that he has expressed. We as a Government are committed to providing a strong local voice for patients through democratic participation. As he and my hon. Friends will appreciate, the nub of the White Paper announced today for Cornwall and for the rest of England is about putting patients at the heart of our reforms, so that their desires and health care needs drive the reformed NHS. No longer will the NHS be told from the top what has to be done throughout our local communities, both in Cornwall and elsewhere. It will be driven by a bottom-up, rather than a top-down, process. To meet that objective, PCT commissioning functions will be phased out and transferred to the NHS commissioning board.

My hon. Friend the Member for Truro and Falmouth asked about the time scale for these reforms. The time scale for phasing is between now and 2013. We propose to replace PCTs with an enhanced role for elected councillors and local authorities to boost local democratic engagement in the NHS. Given the way in which the whole system is to be held accountable, they will increase their responsibilities from their existing role in the public health sphere.

I now turn to my hon. Friend’s point about information. If we are going to create a national health service that is driven by patients, for patients, they must have the information that qualifies them to make the decisions and the choices that are all part of our vision for a patient-led NHS. I can give her this commitment: information across the whole of the health sector will be made available to all patients and members of the public so that they will be able to access it and then make a judgment based on their health requirements as to their choices of consultants and hospitals. That informed decision making can be provided only by enhanced information for those people. I can assure her that that information will be made available so that they can make those decisions and choices.

My hon. Friend mentioned whistleblowing. As she will know, my right hon. Friend the Secretary of State is a strong supporter of holding the NHS to account when it fails or could do better to ensure that we have the finest health service that does not concentrate on processes, as it has for too long, but is driven by outcomes, which is the important thing that matters the most to our constituents. My right hon. Friend has already stated that he is going to strengthen and protect the position of whistleblowers, to use the old-fashioned phrase—I am not convinced it is the best one, but it is certainly the most obvious—so that people who see things that are wrong or things being done that should not be done have the protection and the confidence to be able to draw them to the attention of the authorities so that we can right the wrongs and make the improvements without those individuals fearing for their jobs, future careers and commitment to the NHS. I hope that my hon. Friend is reassured by that.

My hon. Friend mentioned the inspection and regulation regime and the Care Quality Commission. Let me tell her, although she will certainly know the basic principles, that the role of the CQC as the regulator of all health care providers will be strengthened by a clear focus on essential levels of safety and quality. All providers of regulated health care and adult social care will be registered against essential levels of safety and quality, and the CQC has the power to take action against providers that do not meet these standards. The CQC will carry out targeted inspections of providers against the essential standards.

As my hon. Friend will be aware from the White Paper, GP consortiums will commission the majority of health services in place of PCTs, and the NHS commissioning board will authorise consortiums and hold them to account for their performance. The CQC will no longer have a role in assessing commissioning. On the involvement of patient and clinical experience of services in the regulation and inspection regime, instead of focusing on the measurement of processes or targets, the CQC now places the experiences of the people who use health and social care services at the very heart of its work.

The CQC actively seeks the views of people who use health and social care services when making assessments of the quality and safety of that care. When inspecting a care provider, it asks to see evidence of outcomes and evidence that patients experience effective, safe and appropriate care. Rather than looking at policies, it speaks to people experiencing care, to their families and to staff to find out what the quality of care is like in practice. The CQC also actively seeks the views of clinicians, who play a crucial role in improving the quality of care. When there is a problem, it works with them to work out the best way to solve it and to improve care. Clinicians’ expertise in service delivery and design is invaluable, as I am sure my hon. Friend will agree.

In addition, the CQC works in partnership with a range of professional regulators, such as the General Medical Council and the Nursing and Midwifery Council, to ensure that its assessments of a provider are informed by their views on clinical best practice. Integration with HealthWatch, as announced in today’s White Paper, will give patients in Cornwall and throughout the country a greater public voice, providing a greater connection between their views and the actions of the regulator.

I reassure my hon. Friend, my colleague the hon. Member for St Ives and all other hon. Members from the great county of Cornwall that we are determined to improve and enhance the quality of care in the county and throughout the whole country. We want to ensure that the improvements are experienced by patients, because patients are at the heart of the new NHS that we envisage. Only by taking into account what they want and their patient experience within the NHS can we make the improvements necessary to ensure that we have a great NHS not just for the next five years but thereafter.

Question put and agreed to.

Health Funding

Andrew George Excerpts

Tuesday 22nd June 2010 Westminster Hall

[Andrew George (St Ives) (LD)]

I am particularly pleased to have secured this important debate on health funding. I know that the allocation of funding has an impact on a large number of colleagues, particularly those from the north, the midlands and the south-west. I welcome the Minister of State, Department of Health, the hon. Member for Chelmsford (Mr Burns) and the shadow Minister, the hon. Member for Kingston upon Hull North (Diana R. Johnson), to their new posts, and I look forward to their responses.

Although the title gives the impression of a wide-ranging debate, I shall concentrate on a more narrowly drawn issue—the decisions that lie behind the way in which funding allocations for primary care trusts are made. In doing so, I refer to a debate in this Chamber on 18 March 2009 led by the then Member for Wigan and a debate in the House on 17 June last year that was led by me, both on this and related subjects.

When talking about health funding allocations, we speak of the NHS as a national service. The assumption is that funding is provided according to need, and most assume that it is allocated fairly and according to need; but as I have found during my years in Parliament, we may be assuming too much. The funding allocation formula has been reviewed and finessed over time since the inception of the NHS in 1948. However, 13 of the 52 PCTs in the country now receive funding at the floor of 6.2% below target funding. That is many millions of pounds. For example, the Cornwall and Isles of Scilly PCT receives at least £56 million less than the Government admit is needed or should be allocated. The funding formula was most recently altered for the year commencing April 2009.

The purpose of the allocation formula is to make changes on the most objective basis and, as far as possible, to take the matter out of the hands of any political influence. I admit that funding allocation—the weighted capitation formulas and so on—are some of the most dry areas of political debate one can imagine, but I do not apologise for briefly relating their history from the creation of the NHS. Then, of course, people made allocations as best they could in the circumstances, given the uneven pattern of hospital building in the previous century.

In 1970, the Labour Government’s Green Paper on NHS reorganisation included a commitment to a new method of resource allocation. The basic determinant of funding allocation was to be the population served by the area, modified to take account of relevant demographic variables and underlying differences in morbidity. That led to the development of the so-called Crossman formula. Over time, the formula changed to one in which allocations were made according to population, weighted by age, sex and the number of beds and hospital cases. That was further reviewed in 1974 by the resource allocation working party; the result was the transfer of resources from regional health authorities in the south-east to those in the north. The formula was further revised in the early 1990s, and that change resulted in resources being shifted back from the north to the south-east.

One significant element of the formula that has always caused concern to those in parts of the country such as mine was the market-forces factor. It was introduced in 1976, but was significantly altered in 1980 by the advisory group on resource allocation. That informed allocations from 1981-82. It based its recommendations on the new earnings survey, the annual assessment of average wages and salaries in all parts of the country. Cornwall has been at the bottom of the new earnings survey ever since.

What vexed us and others concerned about the allocation of health funding under the market-forces factor was that the poorest-paid areas received the least money. Salaries accounted for about 70% of the market-forces factor, which meant that they had a significant impact on the overall allocation and weighted capitation. Those areas with lower wages therefore suffered; salaries in an area would drag health funding down if they were low.

Throughout the entire debate on the change, we told the Government’s advisory committee on resource allocation that that was clearly unfair, especially as most of those employed by the NHS were paid according to national pay scales. Even those working in the grounds, including those doing building maintenance work, were receiving good money. We felt that the premise on which the calculation was made was unsound. Over the years, we have argued with the Government over the matter. Latterly, however, we persuaded the Government to review the market-forces formula. That review resulted in a change in the funding formula from April 2009.

There is one major element that adds to costs in places such as my area of west Cornwall and the Isles of Scilly. The area includes five inhabited islands—six including St Michael’s Mount—and two substantial peninsulas. It is difficult to provide access to services in that area; providing ambulance services, NHS dentistry and other health services in such a rural context is clearly a great deal more expensive than in suburban or urban areas, but that aspect is not properly taken into account in the funding formula.

On the social side, the impact of salaries and so on, we were pleased that the review resulted in a change in the funding formula for 2009. However, it identified a new set of losers—the 13 PCTs to which I referred earlier, which are currently at the floor of 6.2% below the national target.

Cornwall is £56 million below its target. In the south-west, Somerset is nearly £21 million, or 2.6%, below its target; Plymouth is £26 million, or 5.9%, below target; Devon is over £12 million, or 1%, below target; and Torquay is nearly £9 million, or 3.4%, below its target. Other areas with substantial, gross gaps in funding—those in the minus 6.2% league table—include Derbyshire, which has nearly £73 million less than its target; Lincolnshire, with £74 million less than its target; Nottinghamshire, with £65 million less than its target; and South Staffordshire, with £57 million less than its target.

In contrast, other PCTs receive more than their target and are overfunded in comparison with that target. The vast majority of those fall within the south-east. Surrey receives £171.5 million, or 11.6%, more than its target; Westminster receives £81 million, or 20%, more; Lambeth receives £78 million, or 14.8%, more; Wandsworth receives nearly £65 million, or 14.4%, more; and Kensington and Chelsea receives more than £60 million, or 20.4%, above the target funding. That contributes to health inequalities across the country. I would like the Minister, whom I am looking forward to hearing, to respond to the question of how we are going to ensure that the allocation of funding meets those targets, and does so as soon as possible.

Health Ministers in the previous Government made it clear that we need to be careful not to make catastrophic funding changes to PCTs receiving more than their allocated funding target. Withdrawing funding too rapidly would seriously impact on the health services in those areas. Nevertheless, a formula must be put in place to ensure that those places currently under target are not disadvantaged by remaining under target. For example, this financial year, Cornwall was 6.2% below target and remained there, so we are not moving very rapidly towards our target.

In the previous Parliament, the then Minister of State, Mike O’Brien, said:

“We are committed to moving all primary care trusts (PCTs) towards their target allocations as quickly as possible. In 2009-10 and 2010-11, we have ensured that the most under-target PCTs benefit from the highest increases in funding. Over those two years, the allocation to Cornwall and Isles of Scilly PCT will grow by…12.1 per cent., compared with the national average of 11.3 per cent…The rate at which PCTs will move towards their target allocation in future years will need to be considered in light of a number of factors including population changes, cost pressures and the overall resources available to the national health service.”—[Official Report, 30 November 2009; Vol. 501, c. 529W.]

This financial year, Cornwall has not moved one iota towards its target, which does not really amount to PCTs moving to their target allocations “as quickly as possible”.

[Sarah Newton (Truro and Falmouth) (Con)]

It is marvellous that Andrew has secured this debate so early in the new Parliament, because this is an important issue for everyone living in Cornwall. I applauded the previous Government’s efforts to focus on closing inequalities in health. However, their measure of success, which focused on average life expectancy, did a great disservice to people in Cornwall, as it masks a lot of the problems there. On the face of it, the average life expectancy is way above the national average—

[Sarah Newton]

I shall wind up, then. The crude measure of average life expectancy covers up many problems of poor health and the cost of providing services in remote, sparsely populated areas to an ageing population.

[Andrew George]

I am grateful to my hon. Friend. She rightly highlights that many factors, including life expectancy, rurality and age profile, need to be taken into account, and we must get the balance right. The history of the changes to the allocation formula—not something I would recommend as bedtime reading—shows that all the factors have been conjured with and balanced over time. It is difficult to arrive at a formula satisfactory to all people.

I want to emphasise the fact that we need to identify and make the allocation formula clear. We need to be able to show that it takes into account the health inequalities across the country and, above all, does not further impoverish the most deprived areas. I represent the poorest region in the UK, yet its poverty was used as a reason not to give it additional funds. Its poverty acted against its best interests, which would have been additional funds, as I explained in my description of how the market-forces factor operated and the impact that it had in some areas.

It is difficult to assess what impact the Budget will have on the future of the PCT allocation formula so soon after the statement, which was made in the Commons today. The NHS Confederation recently estimated that the announcements made by the coalition Government indicate a real-terms reduction of between £8 billion and £10 billon in funding to the NHS in the three years from 2011. According to the King’s Fund, a rise in VAT will lead to an additional cost of £100 million per annum to the NHS budget overall.

My hon. Friend the Minister will no doubt ask where we will find the money to provide additional resources for deserving areas such as Cornwall and the Isles of Scilly, Bassetlaw, and South Staffordshire, and the other places that receive allocations that are further below their target than those anywhere else.

[Mr Iain Wright (Hartlepool) (Lab)]

Will the hon. Gentleman give way?

[Andrew George]

I will happily give way, because I asked myself a difficult question and I had better sit down.

[Mr Wright]

I am grateful to the hon. Gentleman for securing the debate and for giving way. He has been an extremely tenacious campaigner on health inequalities and housing, a subject on which I used to speak for the Government in a previous life. What are the hon. Gentleman’s views on the relationship between resource allocation and capital spend? It is an important subject to bear in mind when trying to iron out health inequalities. He mentioned the Chancellor of the Exchequer’s Budget statement, which said: “Well judged capital spending by Government can help provide the new infrastructure our economy needs to compete in the modern world.” If we put that in the context of reducing health inequalities, is it not important to have good capital spend in health? Does the hon. Gentleman share my disappointment at the £463-million cancellation of a new hospital for North Tees and Hartlepool?

[Andrew George]

I thought that the hon. Gentleman would use a local matter as a sting in the tail in his intervention. Let me commend his work on housing, which deserves a great deal of credit. With regard to capital spend, I was never terribly enamoured of the previous Government’s enthusiasm for the private finance initiative projects that were put in place across the country; they did not represent value for money. Having said that, I acknowledge that some difficult decisions need to be taken. I am sure that the hon. Gentleman’s point about his hospital will be heard by Ministers, and that he will be as tenacious in mounting a campaign to ensure that the right decision is taken as I have been on the issue of health funding, and on other issues.

As far as the health allocation formula is concerned, Hartlepool’s funding was 4.3% below its target, so the hon. Gentleman may wish to join the campaign to ensure that the areas furthest from their target achieve their target as quickly as possible. The PCT and the health community in that area may well be able to address their need for capital investment by ensuring that their revenue and allocations are increased by means of our campaign.

The difficult question that the Minister will be asking himself is where will the additional resources be found if areas such as Lambeth, Richmond, Westminster and Kensington and Chelsea are not to have the rug pulled from under them. Part of the answer lies in looking at how the last Government spent their money. There was an obsession with centralised, top-down and quite expensive projects, such as the alternative providers of medical services—or polyclinics, as some people have called them—and the independent treatment centres built across the country, which have never given value for money. A lot of money has also been committed to the NHS information technology programme. I urge the Minister to look at that, and at other such areas, to find the funding, and to give that funding to the PCTs. The PCTs can then decide how best to use their resources, rather than having decisions made for them in Richmond House.

Many issues in Cornwall need a great deal of further investment and support, including ambulance response times. Of course, given our geography, we do not expect to have the quickest ambulance response times in the country, but we would like resources to be put in place to ensure that the ambulance service can at least begin to address some of the deficiencies in the service at present. The NHS dentistry service in Cornwall is one of the most threadbare in the country. Given how difficult it is to see an NHS dentist in most of my constituency, and in many other parts of Cornwall, there would be massive benefits to improving the service there. Other such areas include: cancer screening and prevention; better support for the rehabilitation of stroke patients; improving the functionality of mental health services by ensuring greater availability of therapists and a greater ability to meet demands for treatment; improvements in psychological therapy support for armed forces veterans—provision is clearly insufficient in Cornwall, as in other areas—greater support for dementia; expanding physiotherapy; and improving and investing in the midwifery services in Cornwall, which are overstretched.

In closing, I want to ask the Minister a few questions that hit the bull’s eye of the issue. Bearing in mind that the NHS budget will be protected, how soon will the Government ensure that the funding shortfall in the most underfunded areas of the country is removed? I mentioned the 13 PCTs that are 6.2% below their target; do the Government see those targets as genuine targets to hit, or just as something for the Department to take note of? What is the Government’s policy on the pace of change in the most underfunded areas, and what will be the pace of change in future?

I know that a number of other hon. Members wish to contribute to this debate, so I will resume my seat now. I look forward to the Minister’s response.

--- Later in debate ---

[Diana R. Johnson]

I am grateful that the Minister intervened on me, because I am coming to that. I recognise, as the hon. Member for St Ives probably does, that where we are today might not be perfect, but the previous Labour Government made huge strides in terms of putting money into his area and others that were underfunded. The statistics show that there have been significant improvements since 2003-04, when some PCTs were 22% below target; now the figure is 6.2%, so there has been movement. I am not saying that everything done under the Labour Government was done as fully as we would have liked, but it would be interesting to hear what plans the Minister has to target the pace of change and how soon he feels we will reach the target level for all PCTs. We have to recognise, as I am sure the hon. Member for St Ives does, that taking money from other areas of the country in one fell swoop is not the best way to have a stable national health service.

[Andrew George]

If the hon. Lady rereads what I said earlier, she will see that I very much acknowledge that. Just to reassure her and, indeed, the Minister, let me say that it was in fact 1980 when the impact of the market forces factor changed quite significantly and created the detrimental impact that I described. Yes, I did make some disparaging remarks about the then Conservative Government and I welcomed the additional funding that the Labour Government put in, which I voted for and the Conservatives did not; that is a matter of record. However, I simply urge the hon. Lady to recognise that the formula change, which I fully applaud the last Labour Government for introducing, puts a responsibility on whichever party is in government to ensure that underfunded areas receive their target funding as quickly as possible.

[Diana R. Johnson]

We can probably agree that history is history. We are where we are today, and we need to make sure that we move forward as quickly as possible to get to the point that we all want to be at—an NHS that is funded fairly across England and that addresses some of the issues that the hon. Gentleman raised about rural constituencies and rural areas.

I want to address the rural nature of the hon. Gentleman’s constituency, the primary care trust and the patients that it serves. The issue of islands and peninsulas is also quite unusual, and few primary care trusts have to deal with it, so there needs to be some recognition of that. Clearly, the influx of people during the summer months must swell the demands on the national health service; all that must be recognised and factored in. There is also the issue of poverty. There can be pockets of poverty in rural areas; they are not just in urban areas, although we recognise that there might be different solutions to poverty in different parts of the country.

Let me reiterate that 80% of NHS spending is at primary care trust level, which means that the best solutions for an area can be put forward, debated and agreed at that level. I want to remove the myth that seems to exist that everyone is being told that certain areas have to do things in a certain way. That is wrong. Primary care trusts have much more capacity to design local services to meet their area’s needs. I understand that the new coalition Government will introduce directly elected representatives into primary care trusts to increase the level of local involvement and accountability. I hope that I have that correct, because the Minister is looking at me as if I do not.

--- Later in debate ---

[Diana R. Johnson]

I am delighted to hear it.

I now want to move on to the matter of health spending. I recognise that the hon. Member for St Ives would like more money for his constituency, but I think he recognises that since 1997 the relevant spending on St. Ives, and on Cornwall, has increased. This year the allocation for all PCTs is £164 billion. As I said, 80% of the entire NHS budget is now in the hands of PCTs—the highest proportion ever. That means that local decision making is possible. The PCT for Cornwall and the Isles of Scilly is this year receiving £856.2 million and its budget has increased by 12.4%, but we recognise that it is still 6.2% away from the target.

I am grateful that the hon. Member for St Ives has recognised the work of the independent Advisory Committee on Resource Allocation, which is made up of GPs, academics and health service managers, to develop a new funding formula to determine each PCT’s allocation. That has built on previous formulae to meet the objectives of providing equal access for equal need, and a reduction in health inequalities. Of course, a huge debate has raged about the tensions between the criteria used for allocating resources. For instance, there has been a debate about age versus deprivation, and the Conservative party in opposition would often argue that it was not deprivation but age that should be given more weight. The Conservatives also criticised the weighting of health inequalities in trying to remove those inequalities.

I hope that we now recognise that a series of criteria must be considered. Since last year a new formula has been introduced. We can clearly see how far the PCTs’ actual allocation is from their target allocation. The previous Government’s commitment was to move towards the target, while recognising that that would have to be done over a period of time, ensuring that it did not cause major problems to the smooth running of the NHS throughout the country.

When I looked again at the figures I found that the PCT that was the furthest over its target was Richmond and Twickenham; it was 23.4% over the target. I thought that it would make an interesting example to consider, as the relevant MPs are the Secretary of State for Business, Innovation and Skills, who is a member of the Liberal Democrats, and the hon. Member for Richmond Park (Zac Goldsmith), who is a member of the Conservative party. I can just imagine the tension and debate in that case about chopping the funding allocation for that PCT. Perhaps it would add some strains to the tensions within the coalition.

[Andrew George]

The hon. Lady makes a reasonable point about Twickenham and Richmond PCT, and about all those PCTs that receive significantly more than their target, because of the change in the funding formula. If she reads what I have said, she will notice that I recognise that it would be catastrophic to pull the rug out from under those PCTs, and we cannot do that: over a period of time, which I hope would be as short as possible, we need to find ways to ensure that if there are constraints on NHS spending, the areas that are now below their targets should not suffer.

[Diana R. Johnson]

I hope that the Minister will enlighten us with his thoughts on the pace of change in approaching the target and tell us whether he thinks the Department should adopt a target, with deadlines and dates. I know that he is not keen on targets, as we have seen from announcements in the past few days, but it would be helpful if he would explain his thinking about how we can arrive at a situation in which the hon. Member for St Ives gets his £56 million for his PCT, and other PCTs also receive the money that they feel they need.

The hon. Member for St Ives made a strong case for his constituents. I am grateful for his acknowledgment of the work of the Labour Government to deal with the problem; it may not have gone as far as he would have liked, but an attempt was made to deal with it. I look forward to hearing the Minister’s comments on NHS funding in this context. I wonder whether he will also discuss the issue of capital spending, which is preying on the minds of many hon. Members.

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[Mr Burns]

The hon. Gentleman knows the answer to that question. That is not why the hospital was not given the go-ahead last week. I can appreciate his frustration. As a constituency MP myself, I too would be frustrated, but the hon. Gentleman, who is a generous man, must not try to reinterpret the decision for other reasons. Sadly, the decision was taken simply because of the urgent need of this Government to take decisions to start curbing the ballooning debt problem, which needs to be addressed. That is the reason, I am afraid. It has nothing to do with our commitment to reducing health inequalities and spending more money on providing health care and services for people throughout the country.

I hope that the hon. Gentleman is satisfied with that. If he is not, and if it would be of any help to him, I would be more than happy to meet with him and, if he wants to bring them along, his colleagues from the Hartlepool area and the surrounding constituencies. They can discuss the matter with me—my door is always open. I would be more than happy to do that, if we can arrange a meeting, and if he thinks that it would be helpful.

Let me return to Cornwall and the general position on health funding allocations. I was saying, before discussing Hartlepool again, that we will establish an independent NHS board.

[Andrew George]

On that point, I would be grateful if the Minister would clarify whether the board will replace the Advisory Committee on Resource Allocation.

[Mr Burns]

I can reassure my hon. colleague that it will not. It will be something completely different. It will be a stand-alone body that will be the driving engine of the NHS, in its required field.

By strengthening the link between investment and outcomes, the board will enable the NHS to deliver improved quality, higher productivity and better value for money. I am sure that my hon. colleague will appreciate that I cannot yet discuss the precise functions of the board, nor its composition, but our proposals underline our central belief that resources should be allocated according to need, without ministerial interference.

--- Later in debate ---

[Mr Burns]

I am grateful to my hon. Friend for that intervention. I assure him that the White Paper will be aimed completely at improving and enhancing the provision of health care throughout the country—not just on the Isle of Wight, but on the mainland from Cornwall and the south-west up to Hadrian’s wall in the north. That will be based on a principle of putting patients first and at the heart of health care provision so that they drive the national health service and so that it is there for them and their needs, rather than the needs of management bureaucracy or of politicians micro-managing the system from Whitehall down the road. However much affection and respect I have for my hon. Friend, I cannot be tempted to outline in detail now the White Paper’s contents, but I assure him that when it is published he will share my enthusiasm for the way in which the Secretary of State will unveil his vision for the national health service, not simply for the next five years, but thereafter. I trust that that satisfies my hon. Friend, if not the hon. Member for Worsley and Eccles South (Barbara Keeley).

My honourable colleague the Member for St Ives mentioned the current pace of change, and particularly the distance from target measurements used to assess relative progress towards target allocations. His constituency is in Cornwall and Isles of Scilly primary care trust. It received an allocation of £808 million in 2009-10, which increased to £856 million in 2010-11—an increase, as he knows, of 12.4% above the national average of 11.3%. However, under the formula established by the previous Government, and as many contributors to the debate have noted, that is still 6.2% or some £56.3 million below its target allocation for 2010-11.

I hope that my honourable colleague will appreciate that until the spending review is complete, I cannot comment on specific time scales or the future plans for NHS allocations, nor on the financial standing of specific local health services. I trust that he will be reassured that his partners in Government share a common assessment of both the problems facing the NHS and the solutions available to us.

During the spending review, we will examine rigorously all areas of health spending to identify where we can make savings—for example, by maximising the NHS’s buying power, renegotiating contracts and improving financial accountability throughout the system. The picture that I have painted is of an NHS in which decisions on resource allocation centrally are made by an independent NHS board. But although I cannot give the hon. Member for St Ives the commitment and promise that he wants now, the matter will be examined as part of the spending review between now and the autumn. When our reforms become reality, the NHS board will be responsible for the allocation of spending and will consider a whole range of areas.

[Andrew George]

I want to raise a point for clarification. The Minister described the role of the NHS board and made it clear that it will be remote from political micro-management. He also said that he cannot give me or the PCTs that are a long way below their targets any answer until after the spending review. Will the decision on the pace of change towards achieving targets be made by the spending review, or will that decision be made ultimately by the independent NHS board? If he cannot say which of the two, or which combination of the two, when will I and other hon. Members receive a clear answer on what will happen and who will make the decision on the speed of change?

[Mr Burns]

I believe that I can help my honourable colleague. The ultimate decisions will be made by the NHS board when it is established, but he will appreciate that primary legislation will be required and that that will take time. In the meantime, the allocation of funding for health care throughout the country will be done initially following the spending review, but when the board is established on a statutory basis and operating, it will take over that function. I hope that has cleared up the matter for my honourable colleague.

[Mr Burns]

That is a reasonable question, and I shall be reasonable in my response. The date will be determined partly by Parliament because primary legislation will be required, as outlined in the Queen’s Speech last month. Speaking as an ex-Whip rather than a Minister for Health, I anticipate that the legislation will make progress through Parliament this Session and receive Royal Assent in July next year, or perhaps September, depending on whether there is a spillover in September or October next year, which I do not know at the moment. That is my guess as an ex-Whip for the timetable for the primary legislation. We will then have to wait to see at what point after that it will be up and running, but my guess is that it will be as soon as is feasible.

[Andrew George]

Given the state of flux and the uncertainty of the spending review, which will be followed by the creation of the independent NHS board, there will be a vacuum because decisions have yet to be made in this two-stage process. Will the Minister agree to meet colleagues from Cornwall and me to discuss the progress of that review, either at the time of the review itself or immediately afterwards? We would find that very helpful, because we know that the NHS budget in Cornwall is under tremendous pressure at the moment.

[Mr Burns]

I reassure my honourable colleague that there is not a state of flux. There is a state of potential change, yes, because there is a new Government with an important vision for the future of the health service. That is a difference, but there is not a state of flux because there is stability there. I am not criticising him, but I wanted to reassure him, so that he did not get the impression that there was a state of flux, with the connotations that that has. There is no state of flux. We have a vision, which will be unveiled shortly, but we have things in place to make sure that the system is running properly.

The other thing I would like to repeat—it is so important that it does not matter if it is repeated again, because the issue has featured frequently during today’s debate—is that the Department of Health budget is, of course, protected, which means that in every year of this Parliament, it will increase in real terms. There will be pressures on the Department of Health budget but, under the coalition agreement and the commitment that my party gave prior to the general election, which has been upheld by the coalition agreement, there will be a real-terms increase in that budget. That gives a degree of stability to the health service because it knows that, in every year of this Parliament, it will receive that money.

I thank my honourable colleague for his earnest and informed contribution to today’s debate. As a constituency MP myself, I respect and appreciate the tremendous battle that he has fought over a number of years for Cornwall. I am thrilled to see that my hon. Friend the Member for Truro and Falmouth is also joining in fighting for her constituents to ensure that they, too, get the best health care possible. That is something that all hon. Members want and fight for on behalf of their constituents.

At its most basic level, allocation is a question of measuring need and distributing resources accordingly. To the outsider—and some insiders—funding allocation is a dense and sometimes opaque subject. As the former health editor of The Times wrote,

“only the brave or foolhardy venture into some areas of NHS management. Resource allocation is certainly one”.

I can safely say that my honourable colleague falls into the former category. I trust that he is reassured that although it is too early to comment on specific funding allocations, the coalition’s programme for government shows that we share the same basic belief in the importance of both independence and local decision making when it comes to setting funding levels for the NHS.