Future of the NHS

Andy McDonald Excerpts

Monday 31st January 2022 Westminster Hall

[Matt Vickers]

I am sure we are going to hear about the ways in which these structural reforms will take place with that very aim in mind. I am going to try to get through my speech, because I am sure that Members would prefer for everybody to get in and to hear from the Minister, who is wiser on this issue than I am.

In my view, the Health and Care Bill does not represent an attempt to create a “pay for play” system—quite the opposite. While I am sure the Minister will go into detail about this point in his response, my understanding is that the Bill is largely the work of the NHS itself, inspired by NHS England’s own desire to restructure its organisational system to be more efficient and effective. It builds on the NHS’s own long-term plan, as set out in 2019, and the NHS people plan, which was published in 2020. Many of my conversations with leaders from my local NHS trust suggest that the answers to improving health outcomes require multi-agency working and empowerment of local health agencies, and my understanding is that the reforms and structural changes in the Bill set out to do exactly that.

One point on which I strongly agree with the petitioners is the need to drive value for money within our NHS, reducing management costs and excessive use of consultants, so that the huge increases in funding for the NHS can actually reach the frontline, not just fund more fruitless layers of bureaucracy. I am hopeful that the Minister will update us on what is being done to drive efficiency in that regard. Another point that I fundamentally agree with is the petitioners’ view that private finance initiative contracts have no place in our NHS. I know all too well the debilitating effect they have on the ability of the NHS to administer care across our country. Nationally, PFI contracts cost our NHS £1 billion a year and restrict numerous hospitals across the breadth of Great Britain.

I have seen at first hand how PFIs have damaged our local services in the Tees Valley. South Tees Hospitals NHS Foundation Trust, in particular, has been plagued by a dodgy new Labour PFI contract. The James Cook University Hospital was completed in 2003, but its PFI contract does not run out until 2034, and will cost over £1.5 billion. The trust currently has to meet annual payments of £57 million a year—more than £1 million every week. Of course, hospital upgrades and rebuilds are expensive, but that trust is paying £17.5 million over and above what an equivalent Treasury-funded hospital would cost annually. Shockingly, that is enough to pay for more than 530 nurses. It is ludicrous.

Even if there were not an extra 530 nurses at South Tees, there is so much the hospital could do with this money, such as investing in its building, equipment and staff to help improve health outcomes and inequalities. Excessive costs from historic PFI contracts are listed as the largest single contributory factor to the hospital’s troublesome financial position. At time when retention is a huge issue for our NHS, this money would be crucial to making a substantial difference to the working lives of our NHS heroes. I am glad that in 2018 a Conservative Government decided that PFI contracts would be phased out. However, hospitals up and down the country are now stuck dealing with a Labour legacy that has damaged our NHS, our people and our ability to tackle health inequalities across this country.

[Andy McDonald (Middlesbrough) (Lab)]

Will the hon. Member give way?

[Matt Vickers]

I will carry on; I am sure that there will be a chance for the hon. Member to contribute. I look forward to hearing the rest of the debate and to listening to the input of Members from across the House.

--- Later in debate ---

[Ian Byrne (Liverpool, West Derby) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Gray. The privatisation of the NHS has been a lengthy and well-documented process that started during Thatcher’s Conservative Government in the 1980s. It has shifted the responsibility for the long-term care of the elderly and the vulnerable from the NHS to local authorities, and allowed hotel-type charges for long-term care. This violated a key NHS principle that patients should not pay health charges. Charges became means tested, and homes had to be sold to pay for the bills. Local authorities were forced to pass on their responsibility for healthcare to outsourced private companies. That created a for-profit industry worth £6 billion a year.

Ninety per cent. of nursing home beds are now operated on a for-profit basis. Almost 400,000 elderly patients are now a source of income in an increasingly privatised sector. The staff in those nursing homes are an increasingly casualised and deskilled workforce. The privatisation of care for the elderly created such a mess that we are still trying to sort it out 40 years later. That is the shameful legacy of privatisation in one sector of healthcare. We can see clearly that the process of privatising the NHS itself will follow the same pattern. It will be run by private contractors who will de-professionalise and casualise a temporary workforce.

There has been a creeping privatisation of the NHS. In 2012, an Act was passed that, among other things, required all NHS contracts to be tendered to any qualified provider. Now we have ambulance services run by taxi firms, private companies that have taken over GP practices covering half a million patients in London, and a private company taking over an NHS hospital and cancelling the contract when there was no more money to be made. I have seen first hand, working for Unite and organising outsourced workers in the health sector, the damage that privatisation does to our essential care services.

If that tale of incompetence was not enough, the Government are now pushing through a new reorganisation, this time to establish what they call “integrated care”. It does the complete opposite, instead butchering our NHS into 42 separate areas. It should not be called integrated care but “disintegrated care”. Each area has a fixed budget that cannot be overspent. This will create a postcode lottery and force each area not to co-operate with each other to save cash. Each area board will allow private healthcare companies—another play on words: they are mostly private health insurance companies—to make decisions about the provision of healthcare.

Here we go again: the Government’s answer to underfunding our NHS is to let private companies run it. History has taught us that this is not the solution. NHS staff employed by 42 different organisations face a most uncertain future of casualisation, deskilling and the introduction of poorer terms and conditions. The people of England face a regional, not a national, health system, which will have different terms and conditions for its workforce and different provision of treatment. It is chaotic and irresponsible.

Every Government of the day have been entrusted to preserve and protect one of the country’s greatest achievements—to cherish, not cherry-pick and hive off to the private sector. I urge the Minister to listen to the calls of my constituents, campaigners and the trade unions and scrap the catastrophic Health and Care Bill, which destabilises, fractures and imperils our NHS.

[Andy McDonald]

rose—

[James Gray (in the Chair)]

I apologise to the hon. Member for Middlesbrough; I fear we have no time.

--- Later in debate ---

[Andy McDonald (Middlesbrough) (Lab)]

Thank you, Mr Gray; I am grateful to you for accommodating me. I declare an interest as a private member of Unite the union.

The level of involvement of private interests that has built up in our NHS over decades is deeply troublesome. That concern has been expressed forcefully in the demands set out in the petition that we are debating. That petition has garnered more than 135,000 signatures.

In our manifesto at the last election, Labour stated:

“Our urgent priority is to end NHS privatisation”,

because

“Every penny spent on privatisation and outsourcing is a penny less spent on patient care.”

We committed to repealing the Health and Social Care Act 2012 and reinstating the responsibilities of the Secretary of State to provide a comprehensive and universal healthcare system. We also committed to ending the requirement on health authorities to put services out to competitive tender, to ensure that services are delivered in-house and that subsidiary companies are brought back in-house.

In the moments remaining to me, I will address the issue of the private finance initiative. The hon. Member for Stockton South (Matt Vickers) set out a lot of the detail very accurately. He told us about a hospital in my constituency, the James Cook University Hospital, and I pay tribute to the work of all its team, ably led by Sue Page, the chief executive. That hospital has performed marvels during this period, and offered services to other hospitals across the entire north of England.

I am appealing to the Minister for some help for my hospital, because the burden of PFI has been absolutely colossal: the hospital has cost £1.5 billion to build and maintain since it opened in 2003. The amounts paid by the trust increase every year until the final payment in 2034. I do not want to get into debate about how rotten the PFI deal was, quite frankly. All PFI deals were rotten. They were started in 1992 under John Major’s Government—please, let us not have any of that nonsense. The PFI deal costs an absolute fortune: £20 million more than an equivalent hospital would have to pay for maintenance.

What was missing is what we are going to do about it. As an initial solution, we could look at the decisive action of the Department of Health in 2012 to make £1.5 billion available in grants—not loans—to seven hospitals in England with some of the heaviest PFI debts through a stability fund. The seven trusts were able to use that money, rather than their usual budgets, to meet their PFI payments. It has been done elsewhere. I appeal to the Minister to look very carefully at providing assistance to get this PFI albatross from around our neck and let my hospital thrive and continue to do the wonderful work it has done for many years.