Health and Social Care (Re-committed) Bill

Emily Thornberry Excerpts

Tuesday 6th September 2011 Commons Chamber

[Mr Lansley]

My hon. Friend is right in relation to the independent treatment centre contracts. They were constructed in a way that effectively removed most of the financial risk from the operators. For other private sector operators in the NHS that is not necessarily true. For example, most of us would recognise that private sector providers are instrumental to continued access to many NHS diagnostic services. There are providers who could fail and at the moment no regulatory structure is in place for that.

Let us continue down the path of the implications of the removal of part 3, which the Labour party proposes. Part 3 includes clause 60. I am sure that Opposition Members are familiar with clause 60, their having served in Committee for so long. It is the means by which, if the hon. Member for Islington South and Finsbury (Emily Thornberry) recalls, we can consider the application of Monitor’s functions to adult social care. So precisely when we are legislating to be able to consider whether the implications of an issue such as that at Southern Cross are such that there should be an additional prudential regulatory regime, the Labour party would take away that opportunity.

[Emily Thornberry (Islington South and Finsbury) (Lab)]

Does the Secretary of State agree that it is unfortunate that the Government have not had an opportunity to table detailed amendments on how they would deal with situations such as Southern Cross? To table an amendment that simply says, “At some stage in the future, the Government may be able to do something about a failing organisation such as Southern Cross”, is not necessarily adequate. Although there will be a White Paper on social care next spring, we understand that there are unlikely to be any further details until that point.

[Mr Lansley]

I am confused. I understood that the hon. Lady was a member of the Bill Committees. [Hon. Members: “She was.”] She does not seem to have learned what is going on in the Bill. Clause 60 was not an amendment; it was in the Bill from the outset. It was not introduced as a result of what happened at Southern Cross. We had anticipated the need to address the extent to which Monitor’s functions in relation to the health sector—

[Emily Thornberry]

Will the Secretary of State give way?

[Mr Lansley]

No. I will answer her question. The functions that it exercises in relation to health care include assessing viability and taking action if access to services or the interests of patients or care users are threatened. The Government can consider that by virtue of clause 60. It was not an amendment. So the idea that the measure could not be scrutinised is absurd. It has been in the Bill through all the 100 hours in Committee. If the hon. Lady never said anything about it, that is her own fault and as the shadow care services Minister she should have been more on the ball.

[Emily Thornberry]

Will the Secretary of State give way?

[Mr Lansley]

No. She can sit down.

Let me come to the other Opposition amendments. Amendment 10 would delete all of part 3, which would be absurd. Some of the other Opposition amendments are equally absurd. Amendment 28 envisages that part 3 would remain in place, but that Monitor would license providers of NHS services. However, it then takes away any means of enforcement. Perhaps the Labour party has forgotten that in government if you create obligations it is rather helpful to create a means by which they can be enforced.

Opposition amendment 44 would take the Bill down a slippery slope by trying to prescribe the range of factors that Monitor should reflect in setting prices for NHS services. Such a list could never be exhaustive and would inevitably suggest that some factors were more important than others. It would undermine our ability to hold Monitor to account for setting prices that promote patients’ interests. We must focus Monitor on its duties to promote the quality, efficiency and effectiveness of NHS services, not on trying to prescribe in legislation how it goes about it.

Labour Members have tabled amendments to part 4 that indicate that they either do not understand the Bill, or have abandoned their previous, repeated commitment to supporting all NHS trusts in becoming foundation trusts. They gave that commitment back in 2003, when they passed the necessary legislation, and repeated it in about 2006, when they said that trusts should all be foundation trusts by 2008. The Labour party manifesto from last year—2010—said:

“All hospitals will become Foundation Trusts, with successful FTs given the support and incentives to take over those that are under performing”.

Compare our programme for such hospitals as those in Trafford and Carlisle. The manifesto continued:

“Failing hospitals will have their management replaced. Foundation Trusts will be given the freedom”—

additional freedoms—

“to expand their provision into primary and community care, and to increase their private services”.

We will debate that later today, but I should complete the quote, or I might be accused of being selective:

“where these are consistent with NHS values, and provided they generate surpluses that are invested directly into the NHS.”

That is exactly what we are proposing.

The Labour party appears utterly confused. Does it support foundation trusts or not? The NHS Future Forum said that all NHS trusts should continue to work towards achieving FT status by 2014. It was right: achieving FT status is about demonstrating clinical and financial stability, and we think that all NHS providers should be expected to do that, in the interests of NHS patients and staff. If we maintained the NHS trust legislative model in statute, we would risk losing the change in mindset and the momentum that is being demonstrated by prospective foundation trusts.

Our consequential amendments 219, 220 and 367 to 370 will simply remove references to NHS trusts when they no longer exist—and not, of course, until then. For the hon. Member for Pontypridd, I add that our amendments 185 to 188 make it clear that—sadly for those in Wales—a foundation trust cannot merge with or acquire a Welsh NHS trust.

The Opposition want to take the retrograde step of de-authorising foundation trusts, retaining NHS trusts under the Secretary of State’s direct control, and having them dependent on the layers of bureaucracy that go with that. There would be all the regulatory requirements for foundation trusts and independent providers, and all the bureaucracy that has accompanied NHS trusts and strategic health authorities. That would undermine the FT regulatory regime and the objective of all NHS trusts becoming FTs. Opposition Members who voted in favour of the original legislation establishing foundation trusts in 2003 can have no credibility in supporting Labour now, because the very purpose of that legislation was to give hospitals greater autonomy.

Other Opposition amendments would simply result in duplication and reduced coherence in the Bill. For example, amendments 1166 and 19 seek to retain controls on goods and services, and borrowing and property, but that would duplicate Monitor’s powers through the licensing regime. Deleting clause 166, as the Opposition propose would undermine our intention of increasing transparency in the public financing of foundation trusts. I am looking for the hon. Member for Slough (Fiona Mactaggart); this would have been her moment. Through our amendments, we can show how we can maintain support for FTs, if necessary, in a transparent fashion, including through a requirement, which the Labour party apparently wants to delete, on the Secretary of State to publish an annual report showing what form of financial support has been given to foundation trusts.

I turn to the amendments tabled by my Liberal Democrat friends below the Gangway, who expressed their intention of improving NHS services and ensuring sustainable access for patients. We all share those aims, but I believe that we have in place alternative approaches to meeting those aims. The hon. Member for St Ives tabled a series of amendments emphasising the need to secure sustainability in the provision of NHS services. Securing sustainable access to meet patients’ needs is fundamental to good commissioning. We would expect the board to ensure that there was sufficient competency over issues when it authorised clinical commissioning groups to take on their new responsibilities, and when holding them to account for doing that job.

As the Government have said many times, our focus is on outcomes, including ensuring that patients have access to the services that they need when they need them. That the outcomes must be sustainable is obviously implied, but that is not necessarily the same as saying that commissioners must ensure the sustainability of particular providers or particular services, as amendments 1205 and 1209 suggest when referring to the sustainability of “existing NHS services”. In some cases it will not be in the interests of patients to maintain the status quo—for example, where those services may be unable to improve in line with new standards of clinical best practice, or where there is clear evidence that centralising specialist services on fewer sites would improve health outcomes, as we have seen in examples relating to cardiac, stroke and trauma services. So although I agree with the intention behind these amendments regarding the role of commissioners, I must urge the hon. Member for St Ives not to press them.

I addressed earlier the hon. Gentleman’s amendments about integration and collaboration. On integration, we agree with the conclusion of the NHS Future Forum that integrating services around the needs of patients and giving patients greater choice over who provides those services are not mutually exclusive. As the NHS Future Forum made clear, this is a false dichotomy. As the NHS Future Forum’s report stated:

“If commissioners want to commission integrated care they will only succeed in doing this by creating a new market in integrated care services and stopping the current commissioning of episodic services from different NHS organisations.”

As the hon. Member for St Ives will recognise, his amendments 1207 and 1208 are based upon that dichotomy, so I ask him to withdraw them.

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I do not question Ministers’ intentions, which I think are honourable, but I do think that they have the wrong policy. I do not think that they, as some claim, want to push privatisation across the NHS, but I do think that this could end up being a catastrophic policy that unleashes something that, once it goes through, we will be able to regret at our leisure. On that basis, I simply wanted to raise these matters and ensure that we have an opportunity to debate them, primarily for the purposes of probing the issues.

[Emily Thornberry]

I would like to speak to amendment 1165, which stands in my name and those of my right hon. Friend the Member for Wentworth and Dearne (John Healey), my hon. Friends the Members for Leicester West (Liz Kendall), for Halton (Derek Twigg) and for Pontypridd (Owen Smith), and the hon. Members for St Ives (Andrew George), for Southport (John Pugh) and for Leeds North West (Greg Mulholland). It would delete clause 168, which abolishes the cap on the number of private patients who can be treated in foundation trust hospitals. There has been much interest in this issue, and we will seek a vote on the matter if possible.

Earlier, the Secretary of State assured us that the legislation would not result in a market free-for-all. “That will not happen if this Bill is passed,” he said. But close examination of the clause shows that we will certainly be getting a step closer. It will mean that our national health service, where people are tended by our NHS-trained doctors using our NHS equipment, will be full of private patients, who are able to pay more. Hard-pressed hospitals facing increasingly large shortfalls, desperately trying to balance their books, are bound to take in increasing numbers of private patients.

We have been here before. Many of us remember the last time the Conservatives were in power, when there was a two-tier health service: those who could pay got faster treatment and could skip the queue, while those who could not afford to go private had to wait, and many of them had to die.

I am pleased that the Secretary of State has seen the letter in The Times today. It is often concerning to see how he assimilates data, because he seems to listen only to some things and not to others; he listens to what he wants to hear. I hope that he has realised that in The Times today the doctors, nurses, midwives, psychiatrists, physiotherapists and occupational therapists have said that the Bill will destabilise the national health service. They are particularly concerned about the removal of the private patient cap. Why is that? The Government’s own impact assessment, at B156, acknowledges that

“there is a risk that private patients may be prioritised above NHS patients resulting in a growth in waiting lists and waiting times for NHS patients.”

We could not have put that better ourselves, and it is in the Government’s own impact assessment of the Bill.

If we lift the cap on the number of private patients in the time of crisis that the national health service is about to go into, as night follows day the number of private patients in hospitals will increase, forcing out national health service patients. As a result, waiting lists will go up, and what will the public make of that?

[Dr Poulter]

As the hon. Lady is well aware, the previous Government introduced the private sector in a number of hospitals, and at the moment the private sector works alongside the NHS, helping to cut down on waiting times and the like. She is concerned about the private sector working alongside the NHS in hospitals. Does she have any concerns at the moment based on what the previous Government did in introducing that side-by-side service?

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[Emily Thornberry]

What is extraordinary is that many people who used to go private felt that it was not necessary to do so under a Labour Government because they did not have to wait as they had to under the Conservative Government—that is one thing that I certainly remember. Yes, we have used the private sector as and when it has been necessary to reduce waiting lists, but we are not talking about that now. We are talking about whether there should be a cap on the number of private patients in national health service beds.

[Dr Poulter]

The hon. Lady is very kind to give way twice. She makes well the point about why the private sector is beneficial. We either agree that the private sector adds value to the NHS and patients or we say that it is a bad thing; it is either working at the moment for the benefit of patients and will work that way in future, or it is not and will not. Which way does the hon. Lady see it?

[Emily Thornberry]

I am sure that that contribution was of some use to someone in this debate, but I am not going to bother to respond to it.

[Helen Jones (Warrington North) (Lab)]

Does my hon. Friend agree that the real difference between what was happening under the Labour Government and what is proposed in this Bill is that we used the private sector to treat people on the basis of need identified by the NHS, not ability to pay? This Government propose to allow more people to pay to jump the queue. In that sense, if waiting lists go up, that helps the private sector: there is no point in paying to jump the queue if there is no queue.

[Emily Thornberry]

Exactly; I am very grateful to my hon. Friend.

The Secretary of State, like the Minister of State, the right hon. Member for Chelmsford (Mr Burns), is fond of quoting the Future Forum. I have a quote from Professor Steve Field that I hope will be of assistance to the House when it comes to discussion of the cap. He said in evidence to the Committee:

“if you opened the cap, it made you more likely to be under attack from EU law, competition and Monitor”.––[Official Report, Health and Social Care (Re-committed) Public Bill Committee, 28 June 2011; c. 14, Q24.]

That is one of the arguments that he used. If the Future Forum is concerned about this being another reason why we should not lift the cap, I hope that the Minister will at least listen to its arguments.

As we heard in Committee, a number of criticisms have been made on both sides of the House about the details of the cap and how it is implemented. Indeed, it is common ground that there ought to be some changes to it. We have no problem about changing and modifying the cap and making it more appropriate, but we do not understand why, just because the cap needs changing, it is simply being lifted completely.

A parallel can be drawn with the carbon emissions cap. If I were working in the Potteries in Staffordshire, I am sure that I would believe that the carbon emissions cap was unfair and went against my personal business. One would need to look at the cap and change it as appropriate in order to make it work properly; one would not get rid of it completely just because there are criticisms of it, unless one had another agenda.

The question is why on earth the Government are considering allowing as many private patients as wish to do so to go into our national health service at a time of crisis, pushing out national health service patients. [Interruption.] If the Minister believes that that is wrong, I will be interested to hear an intervention from him in which I hope he will be able to give us a complete assurance that that will not happen. The fact of the matter is that there are not the necessary safeguards. As we understand it, there will be absolutely no limit. We have no idea how foundation trusts are going to respond to the lifting of the cap. We do not know and neither, with great respect, does the Minister. Why is he allowing this great risk to be taken with our national health service? The clause needs to be looked at very carefully in this place, and I know that it will be looked at very carefully in another place.

[Nicky Morgan]

I am not sure whether the hon. Lady has seen a note from the Foundation Trust Network that was, I believe, circulated to all Members of the House and sets out six positive reasons why the private patient income cap has worked: it has allowed hospitals to build new units, to buy leading-edge technology, to extend mental health support, to offer fertility treatment, and to provide maternity services. There is also the fact that rental income is caught by the cap. There are some positive benefits in allowing private patients access to be treated by hospitals. In particular, at a time of financial crisis, bringing new technology into the NHS must be a good thing.

[Emily Thornberry]

I am grateful to the hon. Lady. I think that if we were to stop and walk away from party politics, we would be quite close on this matter. We do not have a problem with there being a cap; the problem is how it is implemented. I think that, deep down, she agrees with us. The difficulty is that her party wants to get rid of the cap completely, and that will have a completely different effect on the national health service. We are happy to sit down and talk to the agencies that will be affected and to make improvements in the working of the cap, but getting rid of it completely is behaving recklessly with our national health service.

[Nicky Morgan]

The misinformation and emotive language that has been used throughout the whole debate has been using patients at the heart of this. Everything we have heard so far on both sides of the House, perhaps prompted by the hon. Lady’s remarks, has been about how bringing in private patients is bad for the NHS. In fact there are some good aspects. I am pleased to hear that there can be some agreement between both sides of the House.

[Emily Thornberry]

That is why I have been relying on the Government’s impact assessment as perhaps the strongest part of my argument. I have also relied on what Professor Field has had to say. I would now like to turn to Baroness Williams, who wrote an article published on 4 September that I commend to the House, in which she says:

“One thing that remains…is the decision to lift the cap on private beds in foundation hospitals. Not only could that mean that many of our finest hospitals would gradually become private, it also means that inevitably foundation hospitals would be subject to European and British competition law.”

Many organisations and people agree with us on this, and that is why the House should pause and think about what we will be doing to the national health service if we accept this clause. I also pray in aid the Royal College of Nursing’s briefing, which Members who are closely following this debate will have read, in which it says that it is against the removal of the cap and does not believe that it will not have an effect on NHS patients’ access to health care. The BMA has said the same thing.

In essence, the argument is about whether we should have a cap or not. If the House votes tonight to lift the cap, our constituents will ask how it can be that their representative has voted for a clause that allows private patients to fill up the national health service hospital paid for by those constituents’ taxes so that they will be pushed out of it.

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[Mr Burns]

I hope that the right hon. Gentleman will forgive me, but I will not give way, because other hon. Members wish to speak and the debate finishes in 20 minutes.

To my mind, the private patient cap and the proposed new restrictions are both unnecessary and damaging. Indeed, I know that this will drive some Opposition Members potty, but the former Labour Minister responsible for the cap, Lord Warner, repented his sins in the other place, describing it as

“wrong and detrimental to the NHS.”—[Official Report, House of Lords, 12 May 2009; Vol. 710, c. 936.]

I urge Opposition Members not to repeat that mistake and to heed Lord Warner’s advice. I appreciate that the Opposition Benches are not full of champions of Lord Warner—particularly not at that end of the Chamber from which we heard the earlier comments about him—but he is a respected former Labour Health Minister and I would suggest that he knows what he is talking about.

Let me deal briefly with two final points that were made by the hon. Members for Islington South and Finsbury and for St Ives about the safeguards that are in place to offer protection and ensure that NHS patients would not lose out with the removal of the cap. First, the NHS commissioning board and clinical commissioning groups would be responsible for ensuring that NHS patients are offered prompt and high-quality care, and that good use is made of NHS resources, whoever provides care, through robust contracting arrangements. NHS patients will also maintain their right in the NHS constitution to start treatment within 18 weeks of referral. Secondly, as foundation trusts do not have shareholders and cannot distribute surpluses externally, and as their principal legal purpose will remain to serve the NHS, all proceeds from non-NHS work would be reinvested in the organisation, ultimately adding to the level and quality of the NHS service.

The Bill will make FTs more accountable and transparent to their public and NHS staff. Our commitment that FTs will produce separate accounts for their NHS and NHS private-funded services—as well as Monitor’s use of its regulatory powers to ensure a level playing field between providers—will also help to avoid any risk of NHS resources cross-subsidising private care, thereby protecting NHS money. I believe that those five safeguards will protect NHS patients and the NHS, and will not lead to the situation that the hon. Member for Islington South and Finsbury described in her speech.

[Emily Thornberry]

I do not mean in any way to suggest that the right hon. Gentleman does not believe what he has just said, but what if he is wrong? It is all very well for him to say, “We’re going to lift the private patient cap—we have these safeguards and I believe they’re sufficient to ensure that NHS patients won’t suffer,” and he may be right. However, the difficulty is that he may be wrong, so why are we taking this risk at a time like this? What is the point? What is the benefit?

[Mr Burns]

I do not think that this will come as a surprise to the hon. Lady, but I do not think that I am wrong, and I say that for the following reasons. First, there has never been a cap on NHS trusts, and the problems that she has speculated about during this debate have never occurred where there is not a cap. Secondly, the reasons that I have outlined would suggest to me that there will not be a problem, particularly as the one hospital that I singled out—the Royal Marsden—has an income cap of 30.7%. Nobody is suggesting that NHS patients are suffering as a result of that, and that is where a substantial income comes from non-NHS work. Finally, the five safeguards that I have highlighted will be powerful measures to ensure that what she describes will not happen.

For those reasons, I would be grateful if my hon. Friend the Member for St Ives did not press his new clause to a vote. I would also hope that, on reflection and having made her points, the hon. Member for Islington South and Finsbury will resist the temptation to press her amendment to a Division. I fear, however, that she is not going to heed my advice, and she will regret it.

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[John Pugh]

I supported the amendment tabled by the hon. Member for Islington South and Finsbury (Emily Thornberry)—or, rather, I tabled it independently. I accepted at the time that it was not the most elegant way of dealing with the problem, but I recognise that there is a problem, as do foundation trusts. The cap as it stands has certain perverse consequences, and the NHS cannot fully profit from sources such as intellectual property. NHS profits help to subsidise public services. As the Minister has pointed out, there is no cap on non-foundation trusts, and the current format was to some extent a political compromise because Labour Members raised certain considerations during the passage of the legislation on foundation hospitals. That does not mean that their concerns were not valid at the time.

I am not concerned by the prospect of dramatic privatisation overnight; nor do I think that queue-jumping is the real danger. By abolishing the cap altogether, however, we run the risk that foundation trusts will run on the wrong side of state aid rules, and that their activity will be perceived as economic activity under EU competition law. The more they subsidise general NHS services, the more they will be perceived as engaging in economic activity.

I do not take a doctrinaire view on this issue. Very sensible people, such as Steve Field and the NHS Confederation, have raised the matter. The hon. Member for Leicester West (Liz Kendall) raised it, as did, if I recall correctly, the hon. Member for Islington South and Finsbury in a spirit of compromise in Committee, making the point—I think I am quoting her correctly—that the only alternative to a bad cap is not no cap at all.

There is a genuine fear, however, among people who are far more expert than most hon. Members in this field, which is caused by the blurring of the boundaries between public and private hospitals. We could end up theoretically with a private hospital that has 90% of its patients provided by the NHS. I know we cannot end up with an NHS hospital filled by 90% of private patients, but there is a threshold at which things could quite easily start to become complicated. This a critical issue, which will have to be dealt with in the House of Lords.

[Emily Thornberry]

The hon. Gentleman has quoted me, so let me clarify that I was quoting the Deputy Prime Minister when I said that the only alternative to a bad Bill was not no Bill at all. I was talking about a Bill as opposed to a cap.

[John Pugh]

I may not have paraphrased the hon. Lady correctly, but I believe that the sentiments I described were expressed by her in discussions of a particular amendment on this subject, but we can go and look at the Committee proceedings to find out whether I am right.

It seems to me that what has happened on this occasion is that the Secretary of State has rehearsed the arguments that we have already heard in Committee. That does not advance things massively. He has supplemented that by saying that better efforts should be made to explain how the cap operates by the foundation trusts themselves, which will be more accountable, as I think he said, to the governing body of the foundation trust. That is an explanation and good explanation is to be desired. The point is, however, that expert opinion—independent of this House— perceives this to be a problem, but it has not been addressed.