Health and Social Care Bill

Lord Warner Excerpts

Monday 13th February 2012 Lords Chamber

A Bill that was partly proposed as a way to tackle bureaucracy has turned out to give the NHS the most complicated structure that it has ever seen. I think we should build some protection into the Bill for the NHS from the massive bureaucracy that it will now come under. I beg to move.

[Lord Warner]

My Lords, I must congratulate my noble friend. He has obviously had an extremely good weekend and is in very fine fettle. He has done a great service in moving the amendment, because it gives us a chance again to air the continuing concern in many parts of the NHS and the outside world about the cost of the organisational changes that flow from the Bill and the risks of those administrative costs escalating in future.

I recognise that nearly all organisational changes have transitional costs, and I do not doubt the Government's genuine belief that their changes will lead to savings in what they call bureaucratic costs. As the Minister knows, I moved some amendments in Committee to try to cap management costs and their annual increases. He told me in the politest possible way and with his normal, reasonable manner that that was unnecessary.

However, I remain concerned about the Government’s ability to keep under control the costs of the organisational changes that they have set in train with the very large number of new bodies that can play in the NHS game, as my noble friend Lord Hunt made clear. I do not intend to go over them again, but there are a lot more of them than there were before. Whether we call them bodies or ill defined entities, such as the senates, they are still people who will be involved in the administrative processes, and I have never found anyone able to engage in administrative processes who does not incur costs and increase the cost of those services. Some of us have been around the public sector quite a long time. Those bodies can use the age-old arguments to grow their organisations over time. Those growths of organisations are, of course, always in the interests of the public. It is always for the best of purposes that they expand.

I see nothing in the Bill that enables those costs to be contained from escalating in future. It is not just about the start-up costs of the national Commissioning Board or Monitor in the early stages; it is a question of where this whole system will end up in two, three, five or 10 years’ time, when we see, in its full glory, how it works in providing our NHS.

My scepticism rests on how the Government have modified the Bill as it has progressed through Parliament. It would be easier to be more confident about containing those costs if, after the pause and as the Bill has progressed, we had not seen modification, often done with good intentions and often moved in amendments from other parts of the House. However, we have ended up with a model that looks jolly different from the one that we started with when the Bill began its passage through Parliament.

I have also been struck by what I can only describe as the naivety of the language of some of the Government’s supporters, who seem to equate eliminating managers with reducing bureaucracy. As my noble friend said, we badly need managers to make this system work. There is a growing belief that somehow, after all these years, clinicians will suddenly be efficient, cost-cutting commissioners of services and we can forget about the quality of general managers. I am pleased to see the noble Lord, Lord Fowler, in his place because he was, if I may put it this way, the father—or grandfather—of the general management that was introduced into the NHS, and he deserves a lot of credit for that. In the 1980s, the Conservatives decided that what the NHS needed was a good dose of general management, and that is what it had. However, managers suddenly seem to be equated by some of the Government’s supporters with the cause of the problem. They are the people whom we seem to need fewer of while we undergo a massive organisational change and have to save £20 billion over four years. How that is all to be done with a new set of organisations and with many of the most experienced managers being lost to the NHS slightly eludes me.

The Government turned their face against using existing legislation to reduce the number of PCTs significantly, reconstituting them with more members from local authorities and more clinicians. Some of us have reduced the number of PCTs and SHAs and have substantially reduced the number of ambulance trusts without any primary legislation at all. I am still waiting to hear convincing arguments as to why we could not have done some of that under existing legislation without inflicting much of the organisational change relating to commissioning. I support in principle more clinician involvement in commissioning, but why could that not have been done within the existing legislative framework without this plethora of new entities being created? These new bodies will have to learn how to run the NHS and will incur quite a lot of costs while doing so.

In the current public expenditure climate, we cannot afford to have what I would call youth training scheme approaches to managing the NHS. A lot of new people will have to learn on the job. If we do not introduce into the Bill some constraints on these costs, they will escalate out of control. That is why I do not think that my noble friend’s amendment is the perfect solution, although it is an attempt to try to curb costs and stop them running out of control. However, I fear that that is what we shall see when the sets of changes in the Bill are implemented in the real world.

[Lord Fowler]

My Lords, when the noble Lord said that the amendment was not exactly the perfect solution, that was a brilliant understatement of the position, as I think almost everyone would agree. My concern about the amendment is that it is a prime example of declaratory law. Almost no one would disagree with the aim of reducing bureaucracy. I suspect that almost every Government since 1946 have said that that has been their aim, although I am not sure that it takes the argument very much further. I am delighted that the noble Lord, Lord Hunt, is proposing this. He was a former director of the National Association of Health Authorities and Trusts, which I never felt was in the foreground of reducing bureaucracy in the health service, but that is doubtless a very unworthy allegation to make against him. However, going purely on the basis of the wording of the amendment, I think that it is simply impractical to have a,

“minimum level of management tiers” .

What does “minimum” mean? It is a wonderfully generalised statement.

The noble Lord, Lord Hunt, touched on the fact that there is a slight implication—I know that he distanced himself from it—of there being opposition to management inside the health service. Of course I agree with the noble Lord, Lord Warner, that management is absolutely of the essence, and I am delighted to have received praise from him. When I introduced general managers into the National Health Service following the report of the late Roy Griffiths, who, people may remember, did so much and produced a wonderful and exemplary report, it was in the face of opposition from virtually all the health service unions, including, needless to say, the British Medical Association, and most of the people who have been opposing the current Bill. It was also in the face of fierce opposition from the Labour Party—in the Commons at any rate; perhaps it was different in this House. Therefore, if I can make an entirely partisan point, I am delighted that we all agree on this serious point. More than 1 million people are employed in the NHS and there is a vast budget. To believe that you can get through the reorganisation without skilful and good management is completely ridiculous and we need to underline that. We are not talking about administrators—a phrase that is still used far too often. We are talking about managers, and what the health service needs is good managers.

I hope that the noble Lord, Lord Hunt, regards this as simply a good amendment for debate and that he will withdraw it because of its manifest defects. However, he rather criticised the new organisation going down to the local level regarding health promotion. Obviously, if you go down to the local level, you are going to have a number of local authorities. However, I should have thought that one thing on which both sides of the House would agree is that health promotion should be carried out with a ring-fenced budget and with local delivery. I should have thought that most people would want to see that. It contrasts with what the previous Government did and doubtless with what happened before that. Money which went to health promotion—I remember this happening with HIV/AIDS—simply was not used for that purpose; it was used for something else inside the health authority. I think that we are taking a giant step forward with health promotion and I am passionately in favour of that.

The amendment of the noble Lord, Lord Hunt, is interesting. I obviously agree with all the sentiments behind it, as I think most people do. However, as a piece of law, it is, frankly, defective.