Health and Social Care Bill

Lord Rea Excerpts

Monday 5th December 2011 Lords Chamber

[Lord Rea]

My Lords, I oppose Clause 31 which concerns the abolition of primary care trusts. My noble friend has talked about the strategic health authorities and, although not in detail, about the problem of getting rid of PCTs. This is intended to give the Minister an opportunity to give us some information about the implementation of this rather stark clause. For example, what about the actual handover of responsibility from PCTs to CCGs? Will all staff of PCTs be made redundant, thus giving rise to considerable redundancy costs? How many and which staff will be retained and transferred? Will those transferred continue their employment without interruption or will they have to reapply for their new post, which in fact is likely to involve the same or very similar work because the provider trusts providing the healthcare will be the same under the CCGs as they are now? Perhaps my noble friend Lord Hunt will amplify this. He has already said a considerable amount about the abolition of the strategic health authorities. Although the work of PCTs has been criticised, it has been improving all the time over the past nine years and much valuable experience in commissioning has been gained. It would seem logical to transfer as much of it as possible to avoid the expense of bringing in outside advisers and consultants or to make sure that such expense is minimised as far as possible.

Very relevant to the commissioning role of PCTs is a document that was published by the Department of Health just last month, Developing Commissioning Support. It includes former PCT staff among those who will be given a role in providing this support. There are many people in PCTs who have considerable expertise. The report’s emphasis is on a business model in which outside organisations, including the independent sector, play a major role. Can the noble Earl tell us how this will be monitored and how transparent the contracting and subsequent work of these outside organisations will be? On the whole, how long will their contracts be for, and will it be possible to terminate them when necessary?

Expressing a view very sympathetic to mine is a quotation that I have found from a speech that was made five years ago in your Lordships’ House regarding private sector commissioning. It reads:

“I want to sound a note of warning. I am worried that if that really is the way that we are going, it could represent a very serious wrong turning, not least in the context of the future development of effective practice-based commissioning”.

This was five years ago, when practice-based commissioning was the order of the day. The speech went on:

“One has to question whether the ethos and values of a private sector organisation will make it fit for purpose as a commissioner. PCTs have public service values and they are accountable. Private commissioners are differently motivated and they are not in the same sense accountable to the public. The way in which private companies operate is too often hidden by considerations of commercial confidentiality, and it is questionable whether they will be susceptible to judicial review. If the Government want to go down the road of private sector commissioning, we need, at the very least, an open debate about it and about what it will mean for the NHS and for patients”.—[Official Report, 3/11/06; col. 581.]

That exactly expresses my views. It will be interesting to know what the noble Earl thinks of it because they are his very own words, spoken when he was winding up for the Opposition in November 2006 on an Unstarred Question that I asked about the role of the private sector in the National Health Service.

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[Earl Howe]

It is accountable for its decisions at a regional or sub-national level in a real sense. If it was not interacting with the boards, the noble Lord, Lord Hunt, might have a point; but it will be. I think that that is accountability in a meaningful sense. The noble Lord, Lord Warner, talks about budgetary accountability, and I understand that that is a real issue. Of course there will be no budgetary accountability, but there will be accountability for the decisions and actions taken by the field forces.

I was saying that the structure means that all too often neither of the roles that PCTs perform is performed well. GPs, who actually make the clinical decisions, are not properly involved in PCT commissioning; and PCTs do not have the detailed understanding of their communities or the link to other local public services. The result is an unsatisfactory compromise, with commissioning that fails to deliver improvements in health outcomes and local services that are fragmented and not integrated.

It has been suggested by some noble Lords that one could have kept PCTs and parachuted in a whole lot of doctors, perhaps filtering out some of the administrators. Anyone who has visited any pathfinder CCG and put that question to the doctors and other clinicians involved will know the answers to why that would not have been a valid and sensible idea. The way in which services are commissioned has to depend on the judgment of clinicians and the wisdom of establishing geographic areas for commissioning groups that make sense in terms of patient flows and in terms of links with local authorities, social services and public health. It does not make sense to retain structures that, frankly, are administrative constructs that do not necessarily bear any relation to patient flows or relationships with local authorities. These clinical commissioning groups are being created from the bottom up by those who know what is in the best interests of patients, and it is to patients that we must always return in our thinking. We currently spend £3.6 billion a year on the commissioning costs of PCTs. PCT and SHA management costs have increased by £1 billion since 2002-03. That is a rise of over 120 per cent. We cannot make savings on the scale that we need to while retaining the administrative superstructure of the NHS.

The noble Lord, Lord Hunt, suggested that the pathfinder CCGs were being built on nothing at all. They are not being created from nowhere. They are building on, and are indeed a logical development of, practice-based commissioning groups, of which there were a very significant number. There are currently 266 pathfinder clinical commissioning groups covering 95 per cent of GP practices in England. As I have indicated before, I cannot say how many we will eventually end up with, but that will give noble Lords a rough indication of the order of magnitude.

The noble Lord, Lord Rea, quoted some words of mine from a debate of several years ago. I would simply say to him that I was speaking then of something completely different from the Government’s current proposals, and I am grateful to the noble Baroness, Lady Murphy, for pointing that out. These reforms place leadership of commissioning firmly with clinicians. I completely agree that giving leadership to a non-statutory, private-sector firm would be a bad idea. That is why there are very clear safeguards against this happening. With PCTs, I feel that there was a genuine question over where commissioning leadership really lay, and this is very firmly no longer the case.

On Amendment 236A, I must clarify one point. It is not the case that a clause stand part debate on Clause 30 would be consequential if a Division was to be called on Amendment 236A and won. It would simply amend this clause and not entail that it needs to be removed.

I hope that I have sufficiently covered the issues raised by noble Lords. I do not suppose that I have satisfied everyone, but I hope that I have at least indicated the direction of government policy in a coherent way.

[Lord Rea]

The staff of PCTs below management level are going to be rather disappointed that the Minister did not answer my question regarding their employment and the possibility of their being moved over to the CCGs, where many of their functions are going to be precisely similar. Are they going to be made redundant? Is it going to be possible to move staff over smoothly without a break in their employment status?

[Earl Howe]

My Lords, the rules apply on transfer of employment, and we anticipate that around 60 per cent of PCT staff will transfer to clinical commissioning groups, local authorities or the NHS Commissioning Board. It has been necessary to institute a programme of managed accelerated retirement for those for whom there will be no posts. However, this is being done in as friendly and generous a way as possible and the process is working well. But on the noble Lord’s main concern, yes, the terms and conditions of employment should not alter for those who stay.