NHS: Health and Social Care Act 2012

Baroness Tyler of Enfield Excerpts

Thursday 8th September 2016 Lords Chamber

[Baroness Tyler of Enfield (LD)]

My Lords, I congratulate the noble Viscount, Lord Hanworth, on securing this vital debate. The starting point for our debate is the impact of the 2012 Act—legislation which is etched on the memory of many in this Chamber, and I suspect none more so than the noble Lord, Lord Lansley, who has just spoken. It was the first Bill I was actively involved in after joining this Chamber and, my goodness me, it felt like a baptism of fire. It is fair to say that it was a highly charged and contentious piece of legislation. However, rather than rehearse the heated arguments again, today I will focus primarily on how the system has responded to the changes and what it means for the future.

We probably all agree that there is no appetite for further structural reform, and I doubt whether there will be in the years ahead. Therefore, the current immense problems of sustainability will need to be resolved within the current architecture. This will require huge ingenuity, creativity, cultural and behavioural change, and transformed styles of leadership at both national and local level, along with very different financial incentives.

As we have heard, the 2012 Act introduced major structural changes—I am not going to run through them again—but how has the system responded to these changes in the face of huge financial and operational pressures? To answer that question it is important to highlight some key factors. First, whatever their rights and wrongs, the geography of clinical commissioning groups is not strategic. Simply put, there are considerably more CCGs—some 209—than there are hospitals, of which there are just over 150. That is not helpful. Such fragmentation militates against strategic planning and decision-making.

Secondly, the more market-based system that competition and the introduction of foundation trusts by successive Governments heralded may have been okay during times of plenty, but during a period of unprecedented austerity, coupled with a major growth in demand, it has proved much harder to sustain. Each trust fights hard to protect its own position, making collaborative working and the significant shifting of resources much harder.

Thirdly, in practice it has proved very hard for GPs to undertake the role envisaged for them of fundamentally reshaping the services provided by hospitals for the benefit of their patients. Too often they have been overwhelmed by rising demand, making effective collaboration between GPs and hospital consultants, which can be hard at the best of times, a distant dream.

The simple truth is that there is not enough money in the system to do all the things being asked of the health and social care system at a time of rapidly rising demand from a growing and ageing population—and that is before we come to the newest policy goal of seven-day working. We would all like to see that in an ideal world, but it must be properly resourced and planned if it is ever to become a reality. The current approach of trying to ram it through on resources that are not really adequate for five-day working, let alone seven, is clearly not viable.

There has been no shortage of recent reports demonstrating the parlous state of NHS finances. Reports from NHS Improvement, the King’s Fund, Nuffield Trust, the Public Accounts Committee and others have all shown rapidly declining financial performance and an alarming scale of deficits. In short, the NHS ended 2015-16 with an aggregate deficit of some £1.85 billion—a threefold increase on the previous year and the largest deficit in NHS history.

It is not at all clear how the £22 billion funding shortfall by 2020 will be achieved. When resources and demand are so out of kilter, what is urgently needed is a system-wide response, with system-wide thinking at its very core. This means putting far greater emphasis on geography—or place-shaping, as it is sometimes called—and, in essence, thinking in terms of local health economies rather than in terms of individual institutions or bricks and mortar. That system-wide thinking needs to be based on trust, collaboration, innovation and sophisticated networking—in short, the key ingredients of a joined-up response.

In fairness, the Five Year Forward View—widely regarded as an excellent document setting out a long-term vision—coupled with the planning guidance are both attempting to do just that. We have recently had the introduction of the five-year sustainability and transformation plan, which highlights the need for systemic leadership and a truly place-based plan, with local leaders, including from local government, coming together and developing a shared vision of what will work best for the local community.

This is a welcome shift in emphasis towards collaboration rather than competition in the way NHS services are planned, even if it is being done somewhat by stealth. It also provides a much-needed opportunity to plan for a health service focused far more on people living in the community with long-term conditions rather than on treating illness in hospitals.

The country is divided into 44 sustainability and transformation footprints, as they are being called. Getting the geography right is essential, and they should have the strategic scale to look at major reconfigurations of services, including shifting resources from the acute sector into primary care, community care and, critically, social care—something that the smaller CCGs clearly struggle to do.

The approach feels right if the focus can be on far greater integration, collaboration and system-wide thinking. It is a real concern that the general mood music around these plans, due to be published in October, is negative at the moment. We have had reports of excessive secrecy, lack of local engagement and a strong emphasis on preventing immediate financial collapse at the expense of proper long-term thinking and planning towards long-term sustainability.

A recent statement from the chief executive of the King’s Fund, commenting on the plans, was blunt. He said:

“Almost all the additional funding provided by the government this year is being used to reduce deficits in acute hospitals, leaving little if any to invest in services outside hospital. Sustainability and transformation plans will not be credible unless they demonstrate how money and staff for these services will be found”.

Similarly, a recent Nuffield Trust report concluded the same thing. It had in it the memorable phrase that we would have to “preserve the NHS in aspic”—meaning having to halt any further advancement in healthcare quality and new treatment.

The final sentence of that report reads:

“The political acceptability of that—following a Brexit campaign which highlighted a potential £350 million for the NHS a week—is highly questionable”.

That is putting it mildly. We must have an honest debate which recognises that the service transformation needed for a health service fit for the future will take much longer than one Parliament, must be properly resourced, even if that means raising extra taxation, and, critically, have the financial incentives which encourage and reward collaboration and system-wide thinking. Otherwise we will simply limp from one crisis to another, and that is to no one’s benefit.