Accountability and Transparency in the NHS

Debate between Frank Dobson and Steve Baker

Thursday 14th March 2013 Commons Chamber

[Steve Baker (Wycombe) (Con)]

My constituent Edward Maitland was a frail man who could not eat solid food following tongue surgery. He was admitted to Wycombe hospital from his warden-controlled accommodation suffering from dehydration, shortness of breath and weight loss, things from which he should have recovered. His son, a paramedic, clearly explained on his father’s admission that Mr Maitland could not eat solid food and he also provided liquids. About three weeks later Edward Maitland had died from aspiration pneumonia. At the post-mortem, Weetabix was found in his lungs.

Of course, the investigation was taken extremely seriously and the documentation is, up to a point, very professional. Under “root cause”, it states:

“The investigation found that there is no evidence to support robust communication between nursing and medical staff…No SBAR”—

situation, background, assessment and recommendations—

“documentation was used in EMC or in handover to Ward 6B this would have highlighted the patient’s nutritional needs.”

It proceeds to make some “recommendations”, but I want to highlight the “lessons learned”:

“To care for all patients with a holistic approach and the multi-disciplinary team must focus on all health concerns.

Better communications between all staff members, this should be ongoing and involve all the different professionals who may need to collaborate the care delivery plan. This collaboration and communication should involve the patient, family and the healthcare staff.”

Unfortunately, that is bread-and-butter, typical stuff—and managerial gibberish.

What I learned is that two words would have saved the life of Edward Maitland: “no solids”, written on the records at the end of his bed, on his wristband, and above his bed. The situation in his case is very simple. A man died who ought not to have died. He should not have died in these circumstances.

I have the hard task of saying, therefore, that I look to the courts, and the Francis report helps me. Recommendation 13 of the report, on fundamental standards, refers to:

“Fundamental standards of minimum quality and safety, where non-compliance should not be tolerated. Failures leading to death or serious harm should remain offences for which prosecutions can be brought against organisations.”

Elsewhere, the report discusses at some length—I do not have time to go into detail—a regulatory gap in relation to the Health and Safety Executive:

“It should be recognised that there are cases which are so serious that criminal sanction is required, even where the facts fall short of establishing a charge of individual or corporate manslaughter. The argument that the existence of a criminal sanction inhibits candour and cooperation is not persuasive. Such sanctions have not prevented improvements in other fields of activity.”

I took legal advice. I approached a retired circuit judge in my constituency, who in turn approached a firm of lawyers. I am most grateful for the guidance of Kate McMahon, of Edmonds Marshall McMahon, who has provided me with considerable free legal advice in relation to this case. The firm specialises in private criminal prosecutions. She has explained that, at least at the preliminary stage, there may be a corporate manslaughter case to answer, and liability for gross negligence manslaughter may well be attributable to one or more employees of the hospital.

I do not want people to be prosecuted unnecessarily, or to see taxpayers’ money wasted, but I do want accountability, and I believe that in the end the courts provide that crucial accountability. Edward Maitland’s son Gary now has this advice, and I have left it to him to decide whether to approach the police. I have briefed the police superintendent in Wycombe on the circumstances. I believe that the courts should be the ultimate way of sanctioning the NHS. Francis agrees, and I hope he will provide a policy in this area.

There should be more democratic control. I am delighted—

[Frank Dobson]

Does the hon. Gentleman not agree that one characteristic of involving lawyers is that there is a lot of money around, and it goes to them? Would it not be better spent trying to ensure that performance standards are enhanced, rather than employing lawyers to have a go at the people who got it wrong?

[Steve Baker]

Of course I would rather that the money was spent on standards and performance and not on prosecutions, because I would rather the problems did not occur. I do not wish to lecture the right hon. Gentleman, and I feel sure he did not quite mean it this way, but if we do not intend to apply the law of corporate and individual gross negligence manslaughter, let us repeal it, or amend it so that it does not apply to the NHS. I have to say to the right hon. Gentleman that it does apply to the NHS and that in certain cases, as Francis has said, things are so bad it should be applied.

I ask the Government to look at democratic control. I am delighted that the Secretary of State is reforming the Care Quality Commission, but how can we make sure that there is more direct accountability, perhaps to the health and well-being boards, and the overview and scrutiny committees? How can we give them the power to sanction or perhaps even, through due process, dismiss a board or a chief executive?

I think here of Paul Ryan, a man with vascular disease who had lost one leg already when he found himself sick. He had four days of GP visits and spent nine hours in accident and emergency on a Friday. He was then sent home, having had an MRI scan, after which he was expecting to lose his leg on the Monday. He was told to expect a phone call, but no phone call came. The Ryans eventually called 999 and were told that it was better to get a GP. The GP arrived and called an ambulance. It took two hours for that to arrive and Paul Ryan died in the ambulance with his wife on the way to hospital.

Financial Services (Banking Reform) Bill

Debate between Frank Dobson and Steve Baker

Monday 11th March 2013 Commons Chamber

[Frank Dobson]

The hon. Gentleman is fairly youthful, so he may not remember the time when most big banks had local bank managers and so had some of the characteristics of the Bank of Dave, in that there was someone local who knew the locality and its businesses. Many people now find that they apply to the bank and the algorithm says no.

[Steve Baker]

My bank manager is named Guy Birkby, and I am sure that he would not wish to be compared with Dave Fishwick because he is an employee of Handelsbanken. I moved my money to Handelsbanken specifically so that I could have a local bank manager who knows me. Indeed, when I ring the bank, people recognise my voice and off we go, and that is a far better way to do business. This particular combination of personal relationship and personal liability—in Dave’s case, not Handelsbanken’s—is a way to re-establish trust. What are the other ways of doing that? They are unlimited liability, which I have discussed, trustee savings banks and mutuals. I am afraid that one of the big flaws of the big bang was that it encouraged this limited liability corporate form where nobody ends up taking the risk and it falls to the taxpayer—it is a disaster.

On ring-fencing, I very much share the comments made by the Father of the House, my right hon. Friend the Member for Louth and Horncastle (Sir Peter Tapsell). I am extremely sceptical that ring-fencing will work. I think that the efforts in the Bill are extremely brave, and of course I shall support it, but this is the last brave attempt to prop up the contemporary monetary orthodoxy. I shall come back to that subject after talking about depositor preference. When we combine the ring fence with the particular instance of taxpayer-funded compensation, there is a real problem that the same old incentives are being preserved. Commercial risk is being subsidised by the taxpayer and to deal with the consequences of having encouraged that reckless behaviour at taxpayer expense an attempt will then be made to regulate those risks away—it has not worked before and it will not work now.

On depositor preference, I have learned through my last five or six years of working with academic economics that if there is one subject we cannot resolve it is who owns—or should own—the money in someone’s bank account and what the contractual obligations should be. In other words, if someone’s money is on demand and they can have it back any time, should there be a 100% reserve—it is their property and the bank is safekeeping it—or should it be the bank’s property which it can use to fund itself?

That question is extremely difficult to resolve, but I shall just cite a speech I have used before, in which the Earl of Caithness said:

“The current crisis, like previous ones, emanated from a base of judicial decisions. Prior to 1811, title to the money in depositors’ accounts belonged to the depositor. However, in that year, decisions in Carr v Carr and, in 1848, Foley v Hill gave legal status to the banking practice of removing depositors’ money from their accounts and lending it to others. Since then, title to depositors’ money has transferred from the depositor to the bank at the moment when the deposit is made.”—[Official Report, House of Lords, 5 February 2009; Vol. 707, c. 774-75.]

That goes very much to the point about the money creation process on which the right hon. Member for Oldham West and Royton (Mr Meacher) and I had an exchange. There was a time when this fractional reserve process created money, but that has now become meaningless, as banks are able to lend with almost no restraint. As I explained in my maiden speech, that is the fundamental reason for this massive boom-bust cycle.

I try never to have an idea of my own on these matters, so let me come back to what Irving Fisher wrote in 1935, when he brought forward a plan for 100% money. He said:

“The essence of the 100% plan is to make money independent of loans; that is, to divorce the process of creating and destroying money from the business of banking. A purely incidental result would be to make banking safer and more profitable; but by far the most important result would be the prevention of great booms and depressions by ending the chronic inflations and deflations which have ever been the curse of mankind and which have sprung largely from banking.”

So I return to David Fishwick, because he knows instinctively, as a business man, that if he takes somebody’s money on demand deposit he should 100% reserve it, in case they want it back.

By this point, I will have upset my friend Professor Kevin Dowd, who was a tutor to Andy Haldane at the Bank of England. I have had the privilege of meeting both of them to discuss these matters. Kevin is a free banker—he would believe in fractional reserves on demand deposits, without a shadow—but in his banking system there would be no limited liability and no taxpayer-funded deposit insurance, banks would issue their own notes and money, at bottom, would be gold. That commodity backing would limit the banks’ ability to create deposits.

There is also a problem in our banking system with accounting, which is another area where I have introduced a Bill. Since I did so, significant progress has, thank goodness, been made on one aspect—loan loss provisioning, which Members can refer to in the media. However, there is another problem with international financial reporting standards accounting for banks, which is mark-to-market accounting. We have heard today the story of how banks have securitised lending and sold it. In a chronically inflationary banking system where banks lent money into existence and, as we heard from another hon. Member, were encouraged to make bad loans—they were creating money to make bad loans into property—they of course wanted to get this off their books. So they wrapped it up in a bond, insured it with a derivative and sold it. They did not even have to sell it. They just took this instrument, moved it from one accounting book to another and they could then immediately mark its value to market. What does that mean in plain terms? It means that one can take 30 years of cash flows, unrealised, from mortgages not yet paid, and by marking them to market within a bond, around a vehicle that is all these mortgages securitised, one can take bad loans—loans that probably will not be repaid—and take it all as profit in capital today. You can pay yourself a massive bonus out of cash not realised—out of capital.

If hon. Members and the Minister wish to know more about how this works, I hope that they will look at my colleague Gordon Kerr’s book, “The Law of Opposites: Illusory profits in the financial sector”. Gordon has spent many years engineering financial products. In a sense, he is a dissident banker gone good. In that book, he explains how those accounting problems, combined with easy money, create so many of the problems that are, as Fisher said, the curse of mankind today.

At bottom, there will ultimately turn out to be two banking reforms that we should adopt. As I have said before—this is particularly the case for the question of the status of demand deposits, gold as the ultimate backing to money and so on—we will find in the end that the Bill is an honourable and brave attempt to prop up a contemporary monetary orthodoxy that is failing. This is the end of the post-Bretton Woods monetary order through which we have been living. We were told that it was a banking crisis. We learned a little later that it was a debt crisis. In a minute, people will realise that what we use as money is debt, that what the banks deal in is debt and that the vast majority of the money in our accounts was created by somebody else taking a loan. When that is accepted, we will discover that this is a monetary crisis. We will then find that there are two plausible ways to reform money and banking.

We could have 100% reserves on demand deposits and the preservation of state control over money and banking—that is, paper money, fiat money, the central banks planning interest rates, taxpayer backing and so on. That is the sort of plan advocated by my friend Jesús Huerta de Soto as a route to what we really should do, which is get the state out of money and banking. We should have a free banking system, as proposed by my friend Professor Kevin Dowd. He has brought forward a plan called “two days, two weeks, two months”, which would return us to a free banking system backed by gold within that time scale. It would not need regulation and it would be just and moral because people would take responsibility for the things they did.

This is not the first time that a monetary order has come to an end. By some calculations, in the 20th century there were about eight global monetary orders. The thing that is remarkable about the post-Bretton Woods order is not that it is ending but that it has lasted so long. I am afraid that I agree that this Bill is not enough, but it makes some progress and I hope that it will be the last attempt to prop up a contemporary banking system that cannot last.

High Speed 2

Debate between Frank Dobson and Steve Baker

Tuesday 23rd November 2010 Westminster Hall

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

When I first looked at the plans for High Speed 2, I was principally concerned with its immediate impact on my constituency where it comes into Euston station. Its effect there would be the demolition of 350 flats, about two thirds of a small park, St James’s gardens, being concreted over, a massive inhibition on the much-needed rebuilding of Maria Fidelis Catholic girls secondary school, and problems for people in the Primrose Hill area, whose homes would be tunnelled under in a big way. However, the more I looked at the proposal, the more I thought that it was not just a matter of the damage that it was likely to do in my constituency, but that the whole project of bringing the line into Euston station and other aspects of the proposal were daft and expensive.

In saying that the London terminal should be Euston station, the projectors had to come up with ways of coping with the fact that Euston station is not on the Heathrow Express line and is not intended to be on the Crossrail route, so it does not have major connections that would be important for High Speed 2. To cope with that, the projectors proposed building a sort of super-parkway station at Old Oak Common—more commonly known as Wormwood Scrubs—and then rebuilding Euston as well. Bringing the line into Euston would also involve the boring of a 5½ mile tunnel, which as we all know is a fairly expensive item.

If the projectors had instead proposed that the line came into Paddington station, that would have made sense, because Paddington is already the terminus for the Heathrow Express and will be on the Crossrail route. The idea of coming into Euston seems to spring entirely from the fact that trains from Birmingham have always come into Euston. There is no more justification for it than that.

When I looked at the plan more widely, it seemed to me that there were other major shortcomings with it. High Speed 1 has been a great success, and certainly the refurbishment of St Pancras station in my constituency—I think that I was the first person to suggest that St Pancras should be the High Speed 1 terminal—has been a great success. The idea that we shall have just one leg of a high-speed system coming into London but not connected to High Speed 1 seems simply stupid. If we are to have a high-speed rail system that is on the end of the high-speed system in the rest of Europe, it would not be a bad idea if it was connected to it, which is not the present proposition.

Similarly, if only one leg of the system from the north will come into London, that will mean that the system is vulnerable to a major crash or terrorist activity that would close down the whole system. I make no comment on where the line should run outside London, but it seems to me that rather than a Y-shape arrangement, there ought to be an H-shape arrangement, so that coming into London are two legs, at least one of which is directly connected to High Speed 1 and would allow trains to come from the east side of Scotland, and the north-east and Yorkshire, and, if they wanted to, come into Paddington. Other trains from, say, Glasgow or Manchester would be able to cross over and come into wherever the link to High Speed 1 was located.

The scheme is badly thought out and extremely expensive. It will be amazingly damaging for my constituency. It should be withdrawn and criteria should be established that set out what on earth it is supposed to achieve. We should then come up with proposals that go some way towards achieving that.

I will move on to the scheme’s affordability. I have, in theory, a degree in economics. I am convinced that economic forecasts for more than 18 months nearly always turn out to be total rubbish. I therefore do not give much weight to anybody’s economic forecasts or assessments of viability for or against the scheme. History shows that all the major railway engineering projects of the 19th century went bust, were involved deeply in fraud or, more commonly, both. I do not think that a major railway project has ever paid back the original investors, unless they have benefited from fraud, such as the huge Ponzi scheme of the line to the north-east. I think we must accept that such projects never will repay their investors and that there is no free-market solution. Apparently, the Institute of Economic Affairs wants to rip up High Speed 1.

[Steve Baker]

On coming to this place, I did not think that I would find myself much in agreement with the right hon. Gentleman, but I am delighted to hear him speak against rail. Would it not have been good if the market had stopped the rail programmes that he has mentioned because insufficient people freely chose them to make them profitable? Money would then not have been wasted on such infrastructure.

[Frank Dobson]

I have never heard anybody suggest that the 19th-century railway boom in every industrialised country in the world did not contribute substantially to the economic development of those countries. Perhaps some people at the Institute of Economic Affairs are so stupid and reactionary that they believe that, but that is by the bye.

The impact of the scheme on my constituency will be dreadful and I reject it on a parochial basis. I also believe that it is ill thought out and will not achieve most of the things that are sought by people who are in favour of a high-speed system in this country.