NHS (Private Sector)

Baroness Burt of Solihull Excerpts

Monday 16th January 2012 Commons Chamber

[Frank Dobson (Holborn and St Pancras) (Lab)]

I agree with a substantial number of the points made by the hon. Member for Southport (John Pugh). The Government claim that their proposals are just an incremental extension of the Labour Government’s involvement of the private sector, bringing private patients into NHS hospitals. In fact, they are nothing of the sort; they are dramatically different in nature and scale. To justify them, the Government grossly exaggerate the contribution the private sector has made.

I am sorry that the right hon. Member for Charnwood (Mr Dorrell) has left the Chamber, as in 1997 when I took over from him as Secretary of State for Health, the NHS was carrying out 5.7 million operations. By the time Labour left office, the figure was 9.7 million—4 million more than when he was in charge. Of those 9.7 million operations a year, 9.5 million were being carried out in NHS hospitals and the private sector was doing 200,000, or 2.1% of the total. So much for its massive contribution to improving the service for ordinary people.

The private sector cherry-picked operations and patients, yet now we have the proposition that things will be franchised out; it was to be to “any willing provider,” but now it is to “any qualified provider.” Recent events suggest that it will be to any willing profiteer—to people who are good at the sales pitch and say that they can keep costs down and are superior to the NHS. They will be the people who use the cheapest breast implants and when things go wrong expect the national health service to bail out the patients they have harmed. They are a bit like the bankers: they are in favour of competition and a free market, but when things go wrong, they say, “Will the taxpayer please bail us out?” That is what we are seeing.

We also see in the proposals that the NHS hospitals should in future be able to undertake up to half the work on private patients. The right hon. Member for Charnwood talked about increased revenue. This year sees the 200th anniversary of the birth of Charles Dickens. He had a character called Mr Micawber, and he would have noticed that it is not the revenue that counts, but the revenue against the cost of providing the service. If the cost of providing the service to private patients is greater than the revenue that comes in from private patients, we are running at a loss and the NHS is subsidising them.

I say that about the Royal Free hospital, which does a very good job in serving my constituency. It just so happens that I have its figures, because I asked for them. In the last year for which figures are available, the Royal Free hospital took in £17.3 million in revenue from private patients. According to the figures it gave me, the cost of providing those services was £15.6 million—an apparent gain of £1.7 million. However, it went on to say that “costs are estimated” and

“not all costs are split between private and NHS patients in this way”.

The costs are not clear. It might look as though the income is clear, but I then asked what the private patient debt is from those people.

[Lorely Burt (Solihull) (LD)]

Will the right hon. Gentleman give way?

[Frank Dobson]

No, I do not have time and others want to speak.

The answer is that, over the past five years, private patient debt has never been lower than £6.4 million, against an income of £17 million. They are not exactly subsidising NHS patients out of the private sector income at the Royal Free, because they do not have enough income to subsidise them.

I recall years ago, when I was shadow Health Minister, running a campaign on this issue. The Tory Government said that they would change the rules and introduce a system, backed up by the National Audit Office, as it is now called—then, it was the Comptroller and Auditor General’s office—that ensured that any private sector contribution produced a surplus. No such arrangements were put in place, and I challenge the Minister to identify what the position is with all those private patients in NHS hospitals. How many are running a surplus and how many are running at a loss?