New Hospitals

Lord Markham Excerpts

Thursday 25th May 2023 Lords Chamber

[The Parliamentary Under-Secretary of State, Department of Health and Social Care (Lord Markham) (Con)]

My Lords, I will repeat a Statement made today in another place on the new hospital programme. The Statement is as follows:

“As we celebrate 75 years of the NHS this summer, we must continue to set up its success for the 75 years to come. At the heart of this is our new hospital programme, the biggest hospital building programme in a generation, which will help us deliver on our manifesto commitment to build 40 new hospitals by 2030. Today, I can reconfirm to the House our commitment for 40 new hospitals to be built by 2030.

We made our manifesto commitment in 2019, and in 2020 we listed 40 schemes as part of the new hospital programme. Since we formally launched the schemes, we have learned more about the use of reinforced autoclaved aerated concrete, more commonly known as RAAC. RAAC is a lightweight form of concrete that, between the mid-1950s and the mid-1980s, was commonly used in the construction of a number of public buildings, including hospitals—often on roofs and occasionally in walls and floors.

We now know that RAAC has a limited lifespan, with difficult and dangerous consequences for the people who rely on or work in those hospitals. I know that this has caused considerable concern to colleagues in this House, to NHS staff in those hospitals and to constituents who are treated in them.

We remain committed to eradicating RAAC from the wider NHS estate. As part of the spending review allocation up to 2024-25, we allocated the affected trusts £685 million in immediate support, but in some cases we must go further. Seven hospitals in England were constructed, either wholly or in major part, with RAAC, and an independent assessment shows they are not safe to operate beyond 2030. Two of the hospitals are already part of the new hospitals programme, namely the West Suffolk Hospital and the James Paget University Hospital. The five remaining hospitals have submitted expressions of interest to join the programme but are not yet part of it. Those are Airedale General Hospital in Keighley, Queen Elizabeth Hospital in King’s Lynn, Hinchingbrooke Hospital near Huntingdon, Mid Cheshire’s Leighton Hospital, and Frimley Park Hospital in Surrey.

We accept in full the independent assessment that these hospitals are not safe to operate beyond 2030. Today, I can confirm to the House that we will expand our new hospitals programme to include those five hospitals built with significant amounts of RAAC. Taken together with the two hospitals already in the programme, the seven RAAC hospitals will be rebuilt completely using a standardised design known as hospital 2.0, with the aim of completing all seven by 2030. I can confirm to the House today that these new hospitals will be fully funded.

I want to take a moment to thank all those who have campaigned so tirelessly for new hospitals to be built to replace the existing RAAC hospitals, including the Members for Keighley and for Shipley, who have championed Airedale vociferously; the right honourable Member for Surrey Heath, who campaigned so strongly for Frimley; the honourable Member for Huntingdon, who lobbied hard for Hinchingbrooke; the honourable and learned Member for Eddisbury and the honourable Member for Crewe and Nantwich, who led the campaign on Leighton Hospital; and the honourable Member for North West Norfolk, the honourable Member for North Norfolk, who is my PPS, and the right honourable Member for South West Norfolk, who all campaigned so assiduously for the hospital in King’s Lynn.

Taken together, the new hospitals programme represents a huge commitment to strengthening the NHS. Since 2020, we have committed to invest £3.7 billion by the financial year 2024-25, and we expect the total investment to now be more than £20 billion for the programme as a whole. Resolving the uncertainty over the RAAC hospitals, which today’s announcement achieves, in turn allows much-needed clarity for the rest of the new hospitals programme. The programme has already been divided into cohorts 1 to 4, with construction in cohort 1 already started. Cohort 1 contains eight schemes. Two hospitals are already open to patients, with the new Louisa Martindale Building at the Royal Sussex County Hospital in Brighton due to open later this year. Work at Moorfields Eye Hospital is due to start imminently, having cleared its final business case.

Cohort 2 comprises 10 schemes. The following schemes will now be ready to proceed, in line with plans set out by the respective trusts: the National Rehabilitation Centre; Derriford emergency care hospital in Plymouth; Cambridge Cancer Research Hospital; Dorset County Hospital in Dorchester; and St Ann’s Hospital, Christchurch Hospital, the Royal Bournemouth Hospital and Poole Hospital, all of which are in Dorset. A further two schemes within cohort 2, Shotley Bridge Community Hospital and the women and children’s hospital in Cornwall, will also be approved to proceed, but in line with the standardised design elements we are promoting through hospital 2.0, on which I will set out further details in a moment. As such, with the uncertainty that surrounded the RAAC hospitals now addressed, all the cohort 2 schemes can proceed, and they will be fully funded.

The cohort 3 schemes include major hospital new builds at Sutton, Whipps Cross, Hillingdon, Watford, Harlow, Leeds and Leicester. Today’s announcement confirms that those schemes will now proceed and be fully funded. They will be constructed using the hospital 2.0 standardised approach. It is worth reminding the House of the merits of using that methodology. First, although longer will be taken on the initial design, rather than each scheme beginning to construct to its own bespoke design, the current approach has meant that the average time from design to completion of a major hospital has been around 11 and a half years. By embracing modern methods of construction, we will massively speed up the construction phase and, in addition, accelerate Treasury and other government assurance processes. There has been much debate to date on when hospitals start, but the more important issue is when schemes are completed. A standardised modular scheme has been shown to work in other sectors—for example, when building schools and prisons—and is widespread across the private sector.

Today’s announcement confirms that all cohort 3 schemes can now proceed. In turn, enabling works that had been held up due to the uncertainty about the RAAC hospitals can now progress. I pay tribute to the right honourable and honourable Members who have campaigned so strongly for the cohort 3 hospitals to proceed. They include the right honourable Member for Uxbridge and South Ruislip, the right honourable Member for Chingford and Woodford Green, the right honourable Member for Harlow, the right honourable Member for Epping Forest and the honourable Member for Hertford and Stortford. I know that not all of them can raise points during this Statement, but the latter three have championed Harlow and its case. The Member for Carshalton and Wallington, to name just one, has raised these issues.

Turning to the hospitals in cohort 4, two of the schemes—West Suffolk Hospital and James Paget University Hospital—are RAAC hospitals. As I touched on a moment ago, they have been confirmed as part of the seven RAAC hospitals. They will therefore be funded for completion by 2030. Four hospitals in cohort 4 remain on track for completion by 2030: Milton Keynes University Hospital, Kettering General Hospital, Musgrove Park Hospital in Taunton and Torbay Hospital. Again, I pay tribute to the Members for those constituencies, including the Members for Milton Keynes South, Milton Keynes North, Kettering, Taunton Deane and Torbay.

The remaining seven hospitals within that cohort will also proceed as part of the new hospitals programme. The work will start on those schemes over the next two years, but they will be part of a rolling programme where not all work will be completed by 2030. That is a reflection of the disruption that two years of the Covid pandemic caused, as well as the pressure from construction inflation.

Some work within cohort 4 will start next year. That includes a new surgical hub at Eastbourne, alongside the discharge lounge already under construction. We will discuss key worker accommodation on the site with the trust, as part of engagement with the local housing association. At Charing Cross Hospital in Hammersmith, work will begin on temporary ward capacity to enable the floor-by-floor refurbishment to proceed. In Nottingham, work will begin on a new surgical hub and three new operating theatres will begin as part of the wider redesign, taking forward the Ockenden report recommendations. In Lancashire, a new surgical hub will be opened at the Royal Preston Hospital, which is due to be completed this year. We will reconfigure services across two trusts. I am sure that one of those sites will be of interest to Mr Speaker, as it is expected to be near Chorley. We are in active discussion with the Royal Berkshire Hospital, given the problems with the existing site, which had already made a 2030 completion date very stretching. In addition, we are building three new mental health hospitals in Surrey and Borders, Derbyshire, and Merseyside.

Turning to Devon, I pay tribute to my honourable friend the Member for North Devon and my right honourable and learned friend the Member for Torridge and West Devon, who have secured new community diagnostics centres at North Devon. The new discharge hub is near completion, and we will take forward discussions with the trust and the local housing association on key worker accommodation over the next two years, as the first part of the North Devon new hospital build. We will discuss the original refurbishment proposal alongside the new build hospital 2.0 option.

In summary, the cohort schemes will all proceed, but the commitment to completion by 2030 applies to the 40 schemes set out today, which meets our manifesto commitment to build 40 hospitals by 2030.

Finally, let me set out the merits of the hospital 2.0 approach. Building new hospitals this way has clear advantages. Construction experts estimate that, with modular design, the efficiency saving will be in the region of 25% per square foot. That is essential in addressing the pressures of construction inflation and unlocking the additional schemes that are being observed as a result of the RAAC announcement.

There is one key risk to today’s announcement: the plan announced by the party opposite. As we speed things up, it is determined to grind them to a halt. The plan it set out on Monday said,

‘as a first step, before we commit to any more money, we’d make an assessment of all NHS capital projects to make sure money is getting allocated efficiently’.

So the risk to these schemes is from those on the Benches opposite.

Today’s announcement confirms over £20 billion of investment for the NHS estate. It confirms that all seven RAAC hospitals, which NHS leaders have called on the Government to prioritise, will be prioritised, with complete rebuilds using modern methods of construction. It will allow all cohort 2 schemes to proceed once business cases have been agreed, and modular build will be used for two of the schemes. It gives trusts the certainty to begin enabling works on major schemes in cohort 3 and a package of early work for schemes in cohort 4, two of which will be accelerated as part of the RAAC programme.

In 2019 we committed to the biggest hospital building programme in a generation, and today we confirm the funding to build 40 hospitals by 2030. I commend this Statement to the House.”

--- Later in debate ---

[Lord Allan of Hallam (LD)]

My Lords, when I worked in business we had a maxim that we should always try to undercommit and overdeliver as a way of pleasing clients. It feels like the opposite is applying here, with the Government scrambling to show that they are not underdelivering on their overcommitment. Of course, 40 hospitals was a classic election promise, oversimplifying a much more complex need, with the reinforced autoclaved aerated concrete hospitals being one of those such complications that emerged once they had turned over the aerated concrete block.

I do not expect the Minister to comment on the election promise, but I hope he can comment further on three aspects of the Government’s programme that he has set out. The first is the modular hospital design approach, which certainly seems a very smart way to proceed if it can provide more and better-quality hospital capacity at lower cost. Of course, any negative impact of failures in design will be multiplied if you are using a similar, consistent design. We should remember that RAAC was the future once, and public buildings were built according to that specification because it was seen to be cheaper and better back in the 1950s and 1960s. What assurances can Ministers give us that they will get it right this time and that the modular approach being used everywhere is the right one? By the way, on branding, 2.0 is now very 1.0, and it might be more appropriate to call it “the metahospital” or “Hospital.AI” these days.

The second is the planning process, which the noble Baroness, Lady Wheeler, raised. It does not matter if the modular design allows much quicker construction if everything is held up in seeking the relevant permissions to build the hospital in the first place. I would be interested to hear how many of the schemes have been given planning permission already and the extent to which the Government see planning as potentially a disruptor to their plans.

Finally, on the risks, if there are delays or cost overruns, which we hope there will not be—but inevitably one sees those with schemes of this kind—I look for assurances from the Minister that the contracts are written in such a way that any additional bills will not fall back on the taxpayer and, crucially, that if some schemes overrun or get into difficulties and incur extra costs, it will not mean that other schemes in the programme have to be cancelled as the overall budget runs short.

[Lord Markham (Con)]

I thank noble Lords for their comments. On a personal front, this is a project I have been working on directly. It is very close to my heart and is something that I am delighted to be able to put forward. I would like to mention a couple of hospitals that probably did not get quite the prominence they deserved in the earlier Statement, which happen to be quite close to my heart as well: the North Manchester General Hospital, which is one of the Cohort 3 hospitals. I have worked closely with Manchester City Council in the past on the redevelopments around Manchester Mayfield, and that is very much part of the plans. Also, being an ex-deputy leader of Westminster Council, I am excited by the plans around St Mary’s, where we are looking at a couple of alternative sites. That will be in conjunction with the plans for the refurbishments of Charing Cross and Hammersmith so we have got three hospitals in one. Just to clarify an earlier statement: the surgical hub is planned for Chorley and South Ribble Hospital rather than the Royal Preston Hospital.

I am not quite sure on the point from the noble Baroness, Lady Wheeler, about the target being abandoned. What we were saying before was not that at all. We were saying we are positive about how it is progressing. To the point from the noble Lord, Lord Allan, about overpromising and underdelivering, I am sorry for the branding of the hospital 2.0 approach, and I take the blame for that. In terms of MMC, I was at one of the plants the other day, and it really is amazing the way its builds them and the speed with which they will go up. Many buildings have built like that for a long time. When I was up there, I saw them constructing the new Everton stadium, which is just one example. I believe that they will give the necessary speed we need for them all.

In terms of the funding, the estimate, as mentioned, is more than £20 billion. Each hospital has an indicative allocation. They are fully funded. We are not publishing them for obvious reasons: when you go out to tender, you do not want to tell the marketplace what you are expecting to pay. I hope noble Lords understand the reason for that. I am confident that the funding is in place. The hope in all of these things, as we have seen in the prison space and the schools space, is that if the first hospital costs £100 to build, the next one costs £95, the next one £90, the next one £85 as you get the economies of scale. So, you should be seeing 20% to 25% reductions, as you do a large production line. The benefit of all this is that there is such a mass volume of them all that you get the economies of scale. I genuinely hope that this will become the way we build hospitals for generations to come. It is very much cross-party, something that we all believe is a good way forward.

Some hospitals, as mentioned—as part of the timing and to try to make sure it all works in terms of the funding envelope—have been pushed into the 2030-35 bracket. They were mentioned in the Statement, and we have been speaking to them about that. They include Eastbourne, the Royal Berkshire, all the ones around St Mary’s with the complications there, Lancashire and Charing Cross to name just a few. In all those cases, they understand the reasons, and I think most people understand the need to prioritise the RAAC hospitals as a matter of absolute urgency.

On the questions about the planning process, we are on target. Obviously, you do not want to get planning permission too early, given the time it takes. In all the programmes I have seen, we do not yet have planning permission because we do not yet need it. I am confident that we are on track. We know that there are always X factors in these types of projects but, when you have so many, you want the flexibility to move some forward and some back, in a portfolio-type approach. That is well known when you are running as many projects as this.

At this stage, in all honesty I can say that we are as confident as we can be that we are on target to build them. Undoubtedly, there will be bumps in the road, and we are grown up enough to know that there are challenges, but I can say with a high degree of confidence that this really is the best approach. We will have world-class hospitals that will be state of the art, not only in their design but in their use of digital technology. A hospital today that is fully digitised costs 10% less per patient. With these hospitals, we should be looking at savings of 20% or more. That will really make a material difference to how we treat patients, increase productivity and be seen as the real way forward. I am very hopeful that the economics will become so compelling that this programme will not stop at 40 hospitals—in fact, 45, because of the extra ones we have brought in—and will become a rolling programme across the whole estate.

I am sure that we will have many more questions on this. As I say, it is my pet subject, as the priority lead, so I would be happy to talk about it in greater detail at a suitable juncture.

[Baroness Wheeler (Lab)]

Can the Minister say something about NHS maintenance costs, which I did ask about? I do not have the actual question in front of me, as my speech has just been taken away, but if he would like to write to me on that, it would be helpful.

[Lord Markham (Con)]

Yes, I will happily write. We are spending a record amount in capital. The current capital budget is about £12 billion, which is a 50% increase on 2019. Speaking of underpromising and overdelivering, believe it or not, we have been hiding our light under a bushel regarding the hospital upgrades. Just this morning I visited Frimley, one of the RAAC hospitals, and they said, “Oh, we’ve just had a new hospital at Ascot”. We have not called that a new hospital but they refer to it as such, and when you see it, it is a new building. It is not massive, but by most definitions it is a hospital.

I will happily provide that extra detail and information. We know that there is a lot to be done on maintenance, but we are putting more resources into it.