Operational Productivity in NHS Providers

Debate between Ben Gummer and Mike Weir

Wednesday 1st July 2015 Westminster Hall

[Ben Gummer]

Absolutely. There are examples of that all over the country, but there are also examples of people working together in what might be considered competitive situations, so it is about ensuring that we copy the best and delete the worst.

Before I turn to the shadow Minister’s comments, I want to reflect on the contribution of the hon. Member for Angus (Mike Weir). The SNP spokesperson on health, the hon. Member for Central Ayrshire (Dr Whitford), has used a constructive tone in the Chamber so far, bringing some of her expert experiences as a clinician and also the experiences from Scotland. It is nice to be able to sit here and hear the experiences of people in Northern Ireland and in Scotland, and it would have been nice to have heard from Wales in this debate. Indeed, we do not yet properly learn from the best in Scotland, which would be all to our good, let alone the best in America or India.

The £22 billion in savings is an estimate not from the King’s Fund but from NHS England. It formed part of its plan, devised at the end of last year and some years in the making, which identified £30 billion of additional money that needs to be put into the service over the next five years. It stated that £22 billion could be generated internally—that was Simon Stevens’ estimate—which leaves an £8 billion shortfall. That is what we are pledged to provide. None the less, he, like everyone in the Chamber, has correctly seen that £22 billion is a large number and one that will take a great deal of intellectual and moral work to deliver. I welcome the tone with which everyone has approached this challenge in the debate.

[Mike Weir]

The reference to the King’s Fund was to make the point that it said that this was a tall order, as I think the Minister himself is admitting.

[Ben Gummer]

It is not a tall order, but it is a challenging one. Whoever was sitting in my place, from whatever party, would be facing a similar challenge, no matter how the needs over the next five years were framed. The challenge must be addressed, and it is better addressed if we all come together to do so.

The hon. Gentleman touched on pharmaceutical savings, which I have not yet addressed, and Lord Carter’s comments on them. Lord Carter will make more detailed recommendations later in the year, but the hon. Gentleman is absolutely right that there is much to be done to ensure that we save money on the provision and purchasing of drugs and by not wasting them. Lord Carter is looking at that, and the service is already implementing his initial recommendations.

New drugs are a problem faced by health services across the world. Indeed, it is a profound challenge, because the new drugs coming online are of an expense that has never been experienced in health systems before. They are also for increasingly small numbers of patients, precisely because they are personalised, which drives up the cost even further. That is why the Under-Secretary of State for Life Sciences, my hon. Friend the Member for Mid Norfolk (George Freeman), is bringing forward his accelerated access review and doing some exciting work, trying to use the muscle of the NHS—our ability to be an research lab, effectively—for those developing new drugs, so that we can use the NHS to drive costs down and provide patients with treatments earlier and more cheaply. There is a win-win there, but it requires a fundamental change in the system, which at the moment is not working.

Finally, I turn to the comments of the shadow Minister, mindful of the need to give my hon. Friend the Member for Hendon time to wrap up. I thank the hon. Member for Denton and Reddish for his kind welcome; it was good of him to say that. I hope that over the next couple of years we will be able to thrash out some of these difficult issues in the manner in which he has begun the process. If we do so, we will come to a better understanding of what is needed in our national health service.

The hon. Gentleman asked a number of questions, such as where the £8 billion is coming from. I believe it is coming from general taxation—my right hon. Friend the Chancellor will be providing greater details of that in the Budget next week. The hon. Gentleman also asked where the £22 billion was coming from. NHS England has devised the plan. It is NHS England’s plan to implement, and it will provide further detail about the £22 billion shortly. It will be an evolving plan that will necessarily change over the five years. NHS England is confident that it is achievable, but it will take some incredible heavy lifting by all of us and, dare I say it, the dropping of political shibboleths throughout the House—if one can drop a shibboleth; I am not sure.

The hon. Gentleman raised the issue of provider deficits, which is a problem across the system. He will know that there was a similar issue towards the end of the Labour Administration—in CCGs, rather than in hospitals. It does not necessarily require more money; it requires getting a grip on where the problem is. We have started that with announcements on agency spending. Many trusts in the country are doing well financially. Not surprisingly, they are often the trusts that are also delivering good care, because—to return to the comments of the hon. Member for Bristol South—if the care is right, the money flows from it. That is why Lord Carter’s review and a concentration on care quality will, we hope, produce the savings that we need, not just at this immediate moment to address provider deficits, but to achieve the £22 billion.

The hon. Member for Denton and Reddish also mentioned sales reps and procurement. I absolutely agree that the subject is covered in the report from Lord Carter. The numbers of product lines certainly should come down. I am not sure that the NHS, before having greater responsibility for purchasing, was any better at buying, but we need to be better at it. Procurement is a science. It is not one that I pretend to know a great deal about, but I know that in the end we will always end up in not quite the right place, because we might centralise too much, which takes away decision-making from the trust responsible. That is why we have to get the balance right.

On the cost of competition, the hon. Gentleman quoted a figure of £100 million. However, I understand that the costs of the reorganisation have been outweighed by the benefits, to the tune of about £1.5 billion annually. I think we all agree across the House on the producer-provider split. There will always be a degree of competition in the NHS; it is about getting the balance right between competition and collaboration.

In the last 30 seconds, let me touch on sub-acute services. The hon. Gentleman made his most pointed—and fair—remarks about the need to integrate social care with the NHS. The Government’s contention is that creating a new national structure for health and social care does not produce the end that we all want to see. That is why we want to see local solutions—we believe a good one is already emerging in Manchester—across the country, which will suit different areas according to their needs. In the end, we come back to money. We all know that money will be tight in local government. Our aim over the next few years is to ensure that as much of the resources that we can put into local government are going towards social care. That is the essence of the better care fund, which lies at the heart of what we are doing on integration over the next five years. I know the hon. Gentleman will want to comment on that as we proceed on those lines.

I thank all Members who have spoken in what has been an invigorating debate from which I have learnt a great deal. I again thank my hon. Friend the Member for Hendon for raising these important issues.