Mid Staffordshire NHS Foundation Trust

Joan Walley Excerpts

Tuesday 7th January 2014 Westminster Hall

[Jeremy Lefroy]

I thank the hon. Gentleman for his intervention and I entirely agree with him. I would see the situation more as two hospitals coming together, but it is vital that the financial difficulties that UHNS is facing are sorted out. I particularly urge the Government to look at the private finance initiative cost, which is too great for that particular trust.

[Joan Walley (Stoke-on-Trent North) (Lab)]

I am most grateful to the hon. Gentleman for giving way and I congratulate him on securing the debate. May I point something out for the record, so that when the Minister comes to reply he can, hopefully, give cast-iron assurances about the financial input that will be needed for this reconfiguration to take place, addressing the issue that UHNS has identified—that the additional expenditure needed for service configuration is in the order of £28 million or £29 million, whereas the trust special administrator has said that only £13 million would be needed? Also, the trust special administrator has proposed a cost improvement programme of 8.5%, whereas Monitor has said that anything above 4.5% is dangerous. We need a very clear, detailed calculation and input from the Government as to how these extra costs will be met, also taking on board the issue about PFI.

[Jeremy Lefroy]

I thank the hon. Lady for her intervention and I entirely agree with that point. There is no point in Stafford’s merging with Stoke if the consequence is that we have a trust that will be financially failing in the future.

The administrators rightly place emphasis on the need for swift action, and I believe that the dissolution of MSFT in the autumn of this year should be possible—indeed, it should be possible even earlier. In fact, I would go further. MSFT has improved greatly in recent years following the huge failings brought to light through the vital work of Cure the NHS and documented in the Francis report. Its recently published hospital standardised mortality ratio figures were the best in the west midlands, but it is fragile and finds it difficult to recruit in some areas. We need the overall arrangements to take immediate effect, even in shadow form. In recent weeks I have detected less engagement than is necessary, because of the uncertainties of the administration process. That needs to stop.

This is all taxpayers’ money. It is our national health service. It is time to work together.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Health (Dr Daniel Poulter)]

It is a pleasure to serve under your chairmanship, Mr Crausby. It is also a great pleasure, as always, to respond to my hon. Friend the Member for Stafford (Jeremy Lefroy) and, indeed, to all hon. and right hon. Members who have contributed to and supported this debate, which raises an important issue for patients and constituents, not just in my hon. Friend’s Stafford constituency, but across Staffordshire and the wider region.

It has been an incredibly difficult time for local patients and staff at the Mid Staffordshire NHS Foundation Trust. I entirely agree with my hon. Friend that the trust has come a very long way since the terrible events exposed by the inquiries and the Francis report last year. My hon. Friend has walked the journey every step of the way with his constituents and with the patients, and he should be congratulated and commended on his strong and superb advocacy of the needs of local patients, of all his constituents and of the families of those who were treated appallingly by the trust in the past. He should also be congratulated and commended on his strong advocacy for the improvements and the high-quality care that is now being delivered by parts of the trust today. I am sure we would all like to put on record our congratulations on his advocacy and on the work done by him and my hon. Friend the Member for Stone (Mr Cash), who for many years has also been a strong champion of local patients.

In responding to some of the points that have been raised today, it is important to talk a little about the trust’s background to provide some context. The trust has been operating at a deficit for some time, and certainly since 2009. In April 2013, the trust reported a deficit of £14.7 million. As my hon. Friend the Member for Stafford alluded to, that position is expected to get considerably worse. As a proportion of the trust’s turnover, the deficit forecast for 2014 is higher than that of almost any other trust in the country. For the past two financial years, the trust received approximately £20 million a year in support from the Department of Health. Without that funding to supplement its income, Mid Staffs would have been unable to pay its staff.

The contingency planning team sent into Mid Staffs in late 2012 concluded that the trust was delivering services at a cost substantially higher than most other trusts in the country. A key challenge faced by the trust is the recruitment and retention of staff and the high cost of temporary staff, which is no wonder, given that it must have been a very demoralising time for those working in the trust when there have been ongoing investigations into events that took place in the past. Additionally, some of the trust’s services are operating with consultant numbers significantly below Royal College guidelines. The 2012 contingency planning team reported that, despite improvements in clinical services, the trust is unlikely to be able to achieve the required cost savings without adversely affecting the quality of care provided to patients.

On the reasons why the special administration process has been set up, it is important to take the initial report into account and to recognise that we are where we are today because of that report. In cases such as this, where a trust is facing substantial financial challenges, it is crucial that action is taken quickly to secure services for patients and ensure that high-quality patient care can still be delivered. The special administration process for foundation trusts offers a time-limited and transparent framework for resolving the problems of a significantly challenged trust. Like the regime for NHS trusts, the special administration process is intended to be used only in the most serious circumstances.

As my hon. Friend the Member for Stafford is aware, Monitor made the decision to place Mid Staffs into special administration on the basis of the 2012 work. The CPT’s first report concluded that Mid Staffs is not financially or clinically sustainable in its current form and recommended the appointment of administrators as the best option for identifying the changes required in the years going forward to continue to secure high-quality patient care. Acknowledging the serious financial challenges facing the trust, the Secretary of State wrote to Monitor giving his support for the appointment of the trust special administrators.

It is worth touching briefly on the work of the trust special administrators at Mid Staffs. The TSAs have been in place since April last year, and they have had two tasks. First, they had to take over the day-to-day running of the trust. Secondly, they have had to work with the trust’s staff, commissioners, providers and other local stakeholders to develop a plan for services. The work undertaken by the TSAs builds on the earlier conclusions of the CPT and only strengthens the case for urgent change. If no action is taken, the TSAs estimate that Mid Staffs’ annual deficit will exceed £40 million in four years.

[Joan Walley]

I am conscious of the amount of time left to reply to the specific points made by the hon. Member for Stafford (Jeremy Lefroy) and in interventions, so will the Minister ensure that the issues flagged up will be responded to in detail in this debate?

[Dr Poulter]

I will of course respond to those that I can, but as the hon. Lady will be aware and as I will set out later, the TSAs’ report is currently with Monitor—I would expect it to be recommended to the Secretary of State by the end of this month—so it would be inappropriate for me to comment on it at this stage. I hope she understands that it would be wrong for me to make assumptions about a report that has not yet been submitted to the Secretary of State.