Regional Pay (NHS)

Ben Bradshaw Excerpts

Wednesday 7th November 2012 Commons Chamber

[Andy Burnham]

I partly welcome what the hon. Gentleman has said. I have already acknowledged the flexibilities, and mentioned that only one trust in England ever sought to make use of them, because it wanted to add to the national floor that we had introduced. The flexibilities were there and I support them, but we left office with a national pay system in place. I look forward to his support later this afternoon.

We have a new Secretary of State, but those who expect a change of direction look set to be disappointed. In his first major interview, he described his mission thus:

“I would like to be the person who safeguards Andrew Lansley’s legacy”.

That must qualify as the shortest suicide note in political history. We have Lansley-lite—more of the same—but, in fact, it may be worse.

Looking at the Secretary of State’s past speeches, I could find nothing that conveyed any passion, belief or commitment to the NHS. On the contrary, I was worried when I read that he tried to remove Danny Boyle’s NHS tribute from the opening ceremony of the Olympic games. He is also one of the co-authors of a right-wing pamphlet entitled “Direct Democracy”. He may remember that pamphlet. It said:

“Our ambition should be to break down the barriers between private and public provision, in effect denationalising the provision of health care in Britain.”

Is that still the Secretary of State’s view? He has gone quiet now, has he not?

You will understand, Mr. Speaker, why NHS supporters get nervous about the intentions of this Secretary of State, but today he has a chance to calm those nerves. He can come to the Dispatch Box and send the clearest of messages to NHS trusts seeking to break from national pay. What he will learn about his job is that, if he says something with sufficient force, the NHS will respond.

The developing pay crisis in the NHS is the Secretary of State’s first real test, but so far he is failing it. As we reveal today, on his watch, the 20 NHS trusts that were threatening to break away in the south-west have become 32 NHS trusts across England. That is creating real worry for thousands of NHS staff and uncertainty for businesses, which have raised their concerns with the Chancellor. But what do we get from the Government today? A “do nothing” amendment expressing no view on the south-west issue, and inviting Government Members to sit on the fence and wait for the conclusions of the pay review body’s review. That will not do.

As the Government do nothing, national pay is being unpicked and the NHS is fragmenting before our eyes, but perhaps that is all part of the plan—it is nothing to do with them; it is all due to a local decision. The idea is to hide behind a review while national pay slowly and conveniently unravels, region by region, trust by trust. Staff facing the threat of a pay cut deserve some straight answers, but rather than getting a straight answer to the question “Does the Secretary of State support regional pay in the NHS or not?”, they are hearing contradictory statements from this shambolic Government. Not for the first time, the coalition is not speaking with one voice. I understand that the Liberal Democrat conference passed a motion opposing regional pay and that the Deputy Prime Minister was captured on film voting for it—although, as we know, being photographed making pledges does not make him more likely to keep them.

The Deputy Prime Minister has also made the following unambiguous statement:

“There is going to be no regional pay system. That is not going to happen.”

The trouble is that it is happening, under the Deputy Prime Minister’s nose and by the back door. Twenty NHS trusts in the south-west are openly defying the authority of the Deputy Prime Minister. Some 88,000 NHS staff are being affected by a unilateral drive to set a new going rate of NHS pay in the regions, which would be up to 15% lower than national “Agenda for Change” rates. The trusts are proposing to end overtime payments for night, weekend and bank holiday working, and to reduce holiday leave. They are also proposing to force staff to work longer shifts, and to cut sick pay rates drastically. That is no idle threat. The silence from Ministers is clearly emboldening them. Despite concerns raised here and elsewhere, they have built a fighting fund, set up a website, and appointed lawyers to make all this happen.

[Mr Ben Bradshaw (Exeter) (Lab)]

My right hon. Friend may not have been able to catch up with this morning’s Adjournment debate in Westminster Hall, but it is more than “silence from Ministers”. The Under-Secretary of State for Health, the hon. Member for Broxtowe (Anna Soubry), who responded to the debate, admitted that the Department had known about the south-west cartel when it happened, and that she supported it. [Interruption.]

[Andy Burnham]

This debate is flushing out the Government’s position, is it not? The Under-Secretary of State keeps heckling from the Front Bench, but we now know—[Interruption.]

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[Mr Hunt]

I support the principles behind “Agenda for Change”, which were introduced in 2004 by the Labour Government of which the right hon. Member for Leigh was a member. I also support a number of other flexibilities introduced by the Government—the right hon. Gentleman supported the legislation—in respect of foundation trusts.

[Mr Bradshaw]

The south-west cartel is not about flexibilities introduced to allow hospitals to attract staff and pay them more, as they in fact did; it is about a regional pay system. The Secretary of State has to decide: is he for or against the south-west cartel? Does he say yes or no?

[Mr Hunt]

Perhaps the right hon. Gentleman will explain why he voted for the Health and Social Care (Community Health and Standards) Act 2003, which gave foundation trusts the freedom to introduce their own terms and conditions. Until he explains that, which we are simply supporting, I am afraid that his position is extremely tenuous.

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[Mr Hunt]

I support proper negotiations between NHS employers and unions to revise, reform and improve “Agenda for Change” so that it is fit for the very different financial circumstances in which the NHS now finds itself. The vast majority of NHS trusts and foundation trusts, including in the south-west, would rather negotiate on national pay scales, but that means the unions being realistic about what is sensible in this financial climate. That is why employers need to use the system more efficiently and effectively, extending the use of high-cost area supplements when they can be justified to tackle the recruitment and retention issues that affect a particular area or region.

Like the previous Government, we want to retain the flexibility that allows individual employers to use recruitment and retention premiums and, like the previous Government, we want any changes to be introduced incrementally in full partnership with NHS employers and trade unions.

[Mr Bradshaw]

Will the Secretary of State give way?

[Mr Hunt]

I have already given way to the right hon. Gentleman once.

The greatest risk to national terms and conditions is that they will become rigid, inflexible and no longer fit for purpose. If that happens, employers will be more likely to use the freedoms given to them by Labour to abandon “Agenda for Change”, which was where those freedoms came from, and introduce local terms and conditions.

The Opposition has a clear choice. They can wolf whistle to their trade union sponsors in a hollow attempt to distance themselves from legislation that they passed, or they can prioritise the interests of low-paid NHS employees by encouraging the unions to work for constructive, negotiated improvements to “Agenda for Change”. Sadly, this afternoon’s debate shows that they have made that choice—the motion is nothing more than a shameless attempt to frighten the hard-working staff of the NHS.

The debate is scandalous scaremongering from a party that did more to introduce regional pay during its time in office than any other Government in history and outrageous opportunism from a party that wanted to cut the NHS budget. Rather than singing to the tune of their trade union paymasters, the Opposition should be telling them to get around the table and negotiate seriously on “Agenda for Change”; rather than scaring NHS employees, the Opposition should be celebrating their achievements; and rather than talking down the NHS, the Opposition should, painful though it is, be celebrating the achievements of a Government who have delivered record NHS performance. I urge my colleagues to support the amendment.

[Mr Speaker]

Order. In the interests of trying to accommodate as many colleagues as possible, and many wish to speak in the debate, I have imposed an eight-minute limit on each Back-Bench contribution with immediate effect. I call Mr Ben Bradshaw.

[Mr Bradshaw]

indicated dissent.

[Mr Speaker]

The right hon. Gentleman had previously expressed an interest.

[Mr Bradshaw]

That is very kind of you, Mr Speaker, but I have had my Adjournment debate this morning and taken up enough time, so I want to let colleagues speak.

[Mr Speaker]

We are extremely grateful to the right hon. Gentleman for his selfless sacrifice. I call Kerry McCarthy.

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[John Pugh]

Absolutely.

I was enlarging on the fact that the Minister has to keep peace between sectors of the coalition, and I do not envy him that role. To be fair, many Members from the majority party are also finding this issue uncomfortably irrelevant.

So what can the Minister do, and what can we do? I have a suggestion. The south-west trust was set up by Labour as an independent providers foundation trust with, frankly, pathetic levels of public accountability. Trusts were set up to operate within a market competing with other NHS providers and private providers, and they do not in law have to consider themselves as part of the wider NHS—as part of national bargaining or “Agenda for Change”. Apparently the trusts in the consortium do not to want to so consider themselves and want to ignore national agreements. If they see themselves as independent free agents in competition with other free independent agents, then surely they cannot all form a cartel with a huge share of the health market and conspire collectively to keep wages, and so their costs, down. That is not a free market—it is market abuse. It is not even fair trading. It is the sort of thing that in the United States would lead to a class action as wage fixing.

That is why my colleagues and I are referring this issue to Monitor and the Office of Fair Trading for investigation. This misguided lot in the south-west cannot be allowed to be freebooters when it suits them and freeloaders on the NHS when asked to play by market rules. If the Government are a bit schizophrenic on this issue, the south-west consortium appears to be even more so.

[Mr Bradshaw]

The hon. Gentleman mentions referring this to Monitor and the OFT. Does he accept from me, as a former health Minister, that all it would take is a word from the Minister to say “Stop it”, and it would stop?

[John Pugh]

I do not think that that is the case, or that the right hon. Gentleman thinks so, but he ruined my punchline, which goes like this: if the South West consortium is even more schizophrenic than the Government on this, it must be made to come to its senses.

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[Mr Cox]

I do not believe that any party can take its hands off and claim to be not responsible for measures that allowed trusts to exploit the ability to drive down pay by forming such consortia. The Labour party cannot disavow responsibility, and neither, if it voted for it, can the Conservative party.

I want to say something about regional pay. I hope and I am sure that the Minister is listening. I have already written to my right hon. Friend the Secretary of State. In areas such as Torridge and West Devon—areas that depend on public sector pay to create the spending and buying power that puts at least some life into its economy—the concept that pay could be even lower than it is now is unconscionable and inconceivable to those of us who represent them. I hope that the Government will think again in this review. I am comforted by the Secretary of State’s words when he says that they are committed to national pay scales. I hope that those words can be counted on.

I, for one, could not support a measure that introduced regional pay as formal NHS policy, unless I was satisfied that there were sufficient safeguards for the low-wage areas I represent. People often associate rural areas such as Torridge and West Devon with prosperity, but that is a grossly inaccurate caricature. In Torridge, 26% of households are on the edge of poverty, wages are in the bottom 5% of all areas in the country, and West Devon is not far behind. It is simply inconceivable for me, as its representative, to agree to a proposition that would further depress incomes in those areas.

Having said that, it is clear that the NHS has to do something about the pay bill, which is 70% of its budget, and the only appropriate way of dealing with it is for the unions and all parties, including all political parties, to tackle it at a national level. I am disturbed that those national negotiations are apparently not taking place. I hope that the right hon. Member for Leigh will encourage the unions to take part in those discussions, because we all have to accept that there is a major national problem with the burden of the NHS pay bill.

[Mr Bradshaw]

Those discussions are taking place. Does the hon. and learned Gentleman think that a parallel process, as undertaken by the south-west cartel, is helping or hindering a successful outcome of the national negotiations?

[Mr Cox]

To be blunt, I am not happy about what I am seeing in the south-west in relation to those 20 trusts, whom I encourage to engage with staff and the unions, as my hon. Friend the Member for North Cornwall (Dan Rogerson) said, and to engage in a process that tries to reach some form of consensual agreement.

To answer the right hon. Gentleman’s question, however, I suspect that those 20 trusts have joined together only out of desperation at the static and stagnating nature of the discussions at national level. They are desperate to manage their budgets. Many are in extremely difficult financial circumstances. I see my hon. Friend the Member for North Devon (Sir Nick Harvey) in the Chamber. I will be meeting the chief executive of Northern Devon health trust shortly, and I know the budgetary pressures that it is facing. He will tell me that it cannot wait for the slow convoy of the national negotiations to take place. I urge it to do so. I hope that we can re-engage at a national level and that there are serious and mature discussions going forward. The truth is—nobody can doubt it—that the pay bill in the national health service needs to be tackled. That is why I say again to the right hon. Member for Leigh that the position adopted by the party he represents is not responsible. What he should be doing is calling for national negotiations to take place as swiftly as possible.

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[Mr David Anderson (Blaydon) (Lab)]

I know it is unusual in this place to listen to anyone who has experience of the real world, but I will try yet again. I worked in the coal industry for many years—in fact for decades. In 1966, a national agreement was reached to bring parity to the system. It took six years for that to be applied across the industry. The main reason why that was done was that people thought it unfair that people who worked in some of the worst conditions in coalfields were historically disadvantaged because they did not produce as much coal as people who worked in coalfields where it was easier to get the coal out. It was the right thing to do. It was based on the principle that applies to this debate—that people should be paid for what they do, not for where they do it. That is the principle that should guide us today.

I had the privilege of presiding over the Unison national conference that agreed “Agenda for Change”. Unison was the last and most reluctant union to sign up to it because it saw some of the problems that it would bring in. We are now seeing those problems. People are exploiting “Agenda for Change.” They are exploiting some of the freedoms intended for families and trusts. Some employers will exploit almost anything. Seeing where we are today and some of what is going on across the country makes me believe that some of the concerns expressed were right.

Today’s debate cannot be separated from what is going on in the rest of the country. We are seeing an anti-worker attack, which is being driven to some extent by this Department but mainly by No. 11 Downing street. Let us look at what is going on. Let us reflect on the background: 750,000 jobs are to be lost in the public sector, while people are having to pay more for their pensions, work for longer and get less pension when they retire. Then there is the pay freeze.

A point was made from the Government Benches about getting the pay burden down, but health service staff will see a reduction of at least 10% in their living standards during the period of this Government. If that is not an example of the workers doing their bit—all being in this together—I do not know what is. Incremental freezes are being introduced, health and safety legislation is being watered down, job security is being weakened, and employment rights and access to industrial tribunals are being changed. There are changes to benefit rules that, officially, are about making work pay, but really mean that people have to go to work for as little pay as employers can get away with. We are back to the future—back to the low-pay, low-skill economy of the 1980s, when people were frightened to stand up for themselves because of the problems they were facing; when compulsory competitive tendering destroyed the conditions of manual workers whose roles were intrinsic to the safety of the national health service.

No one should be surprised to find out that some will be exempt from the regional pay proposals. Who are they? According to the Department of Health submission to the pay review body, the only exemption will be for highly paid managers working in the new bodies established by the Health and Social Care Act 2012. While the people being employed to privatise the health service will not be subject to the regional pay proposals, there will be an impact on the lads and lasses on the front line who look after our constituents day in, day out. That is the unfairness of the situation, and people will focus on the problems at that level in the current negotiations.

The Secretary of State said that he supported proper negotiations, but is it proper that North Tees and Hartlepool NHS Foundation Trust has served redundancy notices on people? That is no way to have proper negotiations. Is it proper that South Tees Hospitals NHS Foundation Trust is thinking about doing the same? City Hospitals Sunderland is trying to freeze increments without consultation or negotiation. Tees, Esk and Wear Valleys NHS Foundation Trust is also freezing increments, while all the trusts in Tyneside, which I represent, have said they will not introduce regional pay. That is one of the problems. Where it is easy to travel from one part of the region to the next, people will travel; people who are not getting a good deal in Hartlepool, Sunderland or Middlesbrough will travel to Gateshead, Durham or Newcastle. National terms and conditions are key, so that people are paid the same no matter where they work. Otherwise, recruitment and retention will become a huge issue.

It is clear that the majority of people who have spoken in the House and outside oppose regional pay. Ten north-east firms have urged the Government not to introduce regional pay, because reducing the spending power of public sector workers in the region will have a hugely detrimental impact on their businesses.

I raised a point with the Secretary of State about trade unions, but let me refer to the BMA, the RCN, the Royal College of Midwives and the Chartered Society of Physiotherapy. None of them is affiliated to or the paymaster of the Labour party, but all of them say, “Don’t do this.” But it is not just them saying it. The hon. and learned Member for Torridge and West Devon (Mr Cox), the hon. Members for Hexham (Guy Opperman), for Brigg and Goole (Andrew Percy), for Stafford (Jeremy Lefroy) and for Carlisle (John Stevenson)—all Conservative Members—are all against the proposal. A raft of Liberal Democrats—the hon. Members for North Cornwall (Dan Rogerson), for St Austell and Newquay (Stephen Gilbert), for Torbay (Mr Sanders), for Manchester, Withington (Mr Leech), for Southport (John Pugh), and for St Ives (Andrew George), and even the Secretary of State for Business, Innovation and Skills—are opposed to it. The Deputy Prime Minister is also opposed to regional pay, as was his party conference. How on earth can the Conservative party try to force it though?

[Mr Bradshaw]

My hon. Friend says that the Liberal Democrats have said they are opposed to it. Will not the test be how they vote in a few minutes’ time?

[Mr Anderson]

I have always appreciated my right hon. Friend’s talents, but I ask him please not to steal all my thunder.

Who wants regional pay? The Department of Health, but even more so, the Chancellor of the Exchequer, as it is part and parcel of an attempt to drive down workers’ conditions and undermine the work force for ideological reasons. He is putting the NHS at risk for the sake of party political advantage. It is a disgrace.

How will the Liberal Democrats vote tonight? I have read the amendment—I used to write amendments —and it is the easiest thing in the world to fudge your way around something, but this is a point of principle. Let us make no mistake. The people out there—the nurses, the midwives, the doctors—will read the weasel words of the amendment as exactly what they are. The basic principle is in the motion. We want the Government to tell the employers that there is a national pay bargaining agreement, and they should stick to that.

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[Andrew George]

If the hon. Gentleman really believes that, and the motion does say that the Government should intervene, is he aware that his Government gave foundation trusts such freedoms that in fact the Government cannot intervene?

[Mr Bradshaw]

Of course they can.

[Andrew George]

They cannot.