NHS in London

Meg Hillier Excerpts

Thursday 24th March 2016 Westminster Hall

[Wes Streeting]

They may well be the judge, but I am standing down as a councillor in 2018. I was elected to Parliament while serving as a councillor, which is a good indication.

Seriously, the London Borough of Redbridge has the fourth lowest public health grant in London. Given the diversity of our population, and the pressures that that brings, it is a cause for concern. In that context, I was even more disappointed to find that the Government have cut our public health grant in-year. As a former cabinet member for health and wellbeing in Redbridge, and as the former chair of our health and wellbeing board, I know that we were already struggling to meet our statutory duties on public health, not least the new responsibilities we have been given, such as for health visiting, for which the allocation received from the Government was not sufficient. We managed to squeeze some extra funding out of the Government, but we are still struggling.

The reduction is disappointing, particularly in the context of London, where people’s healthcare needs and lifestyles are placing pressures on the NHS. Public health investment is an upfront investment in people’s lifestyles that will reduce NHS costs in the longer term, as well as improving people’s health and wellbeing. I cannot understand why, in that context, preventive budgets such as public health budgets are bearing the brunt of cuts. I hope Redbridge’s public health allocation in particular is something that the Department of Health will revisit.

I have talked about the financial challenge for local authorities, and I will now address the financial challenge facing the NHS and our local health economy. I was concerned, as everyone else was, to read David Laws’s revelation at the weekend that, far from the £8 billion that keeps being mentioned as the hole in the NHS budget, Simon Stevens actually identified a £30 billion hole, of which he said £15 billion could be found through efficiencies and improvements. My maths makes that a £15 billion hole in the NHS budget, and it is a source of concern that the £8 billion promised by the Conservatives at the last election is still not there. We have seen the Chancellor having to shuffle money around. Earlier, my hon. Friend the Member for Lewisham East (Heidi Alexander), the shadow Secretary of State for Health, talked about the reallocation from capital to revenue in terms of the health budget.

[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

The Public Accounts Committee recently considered the health budget following a National Audit Office report. There is a £22 billion gap, and one of the key drivers of that is the 4% efficiency savings year on year. Simon Stevens has himself acknowledged that that is too high and that 2% would be more reasonable. The head of NHS Improvement also acknowledged that it is a cause of acute hospitals’ deficits at the moment.

[Wes Streeting]

I am grateful to the Chair of the Public Accounts Committee for giving us that insight, which gives me even greater cause for concern about our local situation in Redbridge. The overall gap in funding for the NHS should be a concern to the whole country.

In my borough in particular, I am concerned by a report produced for NHS England by McKinsey & Company in, I believe, July 2014. The report has just been released by NHS England following a freedom of information request, and it identifies a Barking, Havering and Redbridge system gap of £128 million for commissioners and £260 million for providers. I am concerned by several things. One is that one way in which McKinsey identified that the BHR system will be able to address that gap is through acute reconfiguration of King George hospital, where the accident and emergency department is threatened with closure. I am deeply disappointed that, at a recent meeting of the Ilford North Conservatives attended by the hon. Member for Richmond Park (Zac Goldsmith) for his London mayoral campaign, the Conservatives once again stood up and said, “People should not worry about the accident and emergency department, because we always say it’s going to close and it never does.” The only reason why the accident and emergency department at King George hospital is still there is not because of a positive decision to keep it but because the NHS trust and the local health economy are in such a mess that it would not be clinically safe to close it at this time; the accident and emergency department is still very much at risk.

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[Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Ms Buck. I congratulate my hon. Friend the Member for Ealing Central and Acton (Dr Huq) on securing the debate, and I thank the Backbench Business Committee for granting it.

I represent the Homerton hospital, which is a foundation trust, and a clinical commissioning group in Hackney that has good, clear clinical outcomes in a very deprived population. The level of deprivation is such that we have underlying population health outcomes that are not good despite the good healthcare available locally.

There is huge pressure on GP surgeries across east London in particular and London in general. Funding for the minimum practice income guarantee is under threat, and recruitment of GPs is very difficult now. Too often, committed but demoralised GPs, many of whom are older, are—in line with national trends—retiring early. We also have a devolution model that is being piloted in Hackney.

Given the time and to give the Minister the chance to respond, I will jump to some of the questions that I want to put to her. I will refer to the McKinsey report that has just seen the light of day today, although it was published in July 2015. It is very worrying. I do not have time to go into the report in detail, but it raises issues about my area that are similar to those raised by my hon. Friend the Member for Ilford North (Wes Streeting). It gives an indication of the gap in the health economy and the funding. We have looked at this type of gap in the Public Accounts Committee, holding three hearings on these issues in recent months. Those hearings have underlined the crisis in recruitment, poor retention of experienced staff and particularly the financial crisis in the NHS.

The PAC, which of course is a cross-party Committee, is not alone in looking into this situation; the National Audit Office has, too. The NAO tells us that in 2014 NHS commissioners and providers overspent for the first time, with a deficit of £471 million. It must have been around that time or before then that McKinsey was commissioned to do its work. We know that the position is deteriorating, despite the efforts of consultancies to come in and save the day—let me make it clear for the Official Report that I am being slightly ironic. The position is deteriorating so much that the total deficit in NHS trusts and foundation trusts is projected to be £2.2 billion.

As I highlighted in my intervention, in a PAC hearing on the subject, Jim Mackey, the head of NHS Improvement —we have also heard from Simon Stevens, the head of NHS England—acknowledged that the 4% efficiency savings target that was established by the Department of Health in 2010-11 was unrealistic. In fact, that target was set by the Chancellor, so I should perhaps absolve the Department of Health a little, as it was clearly set by the Treasury. Both Jim Mackey and Simon Stevens acknowledged that. Simon Stevens has said on the record that he would call delivery of 2% efficiency savings “more reasonable” for trusts. As I have highlighted, we have said in our report that there is not really a convincing plan for closing the £22 billion gap in NHS finances now looming.

I will come back to the McKinsey report as it relates to my own area, referring again to huge financial gaps in the NHS budget locally. However, it also refers to how to deal with those gaps, and that is what really concerns me and it is what I am seeking an answer from the Minister about. The report refers to the engagement that McKinsey had:

“an intensive series of meetings and engagement…with material senior time and…complemented this with numerous sessions with Chairs, CEOs, Clinical Leaders and Finance Directors.”

So McKinsey has been getting people round the table, which is all well and good. However, the report continues:

“This engagement has been focused on building alignment around the case for change”—

so change is looming—

“on forcing the pace of this work and also in scoping future governance changes to sustain more rapid future delivery.”

Will the Minister be clear about what the plans are for “future governance” of health services in my part of London? I am sure that other Members will be interested to hear about their parts of London, as well. I ask her directly: is there a plan to amalgamate CCGs or to establish sub-regional health commissioners in London? We need to know what is happening and what the timescale is for any proposed changes.

Also, while we are considering the budget and the gaps in the budget, what commitment can the Minister make about NHS land? That has been a constituency concern of mine for some time. The PAC has heard fairly recently that the capital released to balance the budget deficit that we are seeing among trusts factors in some land for homes for health workers. So the full dividend of sale will not be taken and some land will be used to build homes for health workers, but figures were very light on the ground. If the Minister is able to respond today on this issue, I would be very grateful; if not, I would welcome a detailed letter from her on it.

In particular, I would be grateful if the Minister provided more information about the list of NHS sites released under the Government’s land disposals programme. The programme was overseen by the Department for Communities and Local Government and required every Department to come up with a list of sites that could be provided to build new homes. So far, it has been difficult to identify the sale of land and how many homes have actually been built. Again, that may not be something that the Minister has answers on today, given that another Department is the lead, but I think her Department should have some figures. Once again, if she cannot tell me about that today, I ask her to write to me about it, because housing for health workers is a key concern.

[Heidi Alexander]

My hon. Friend is making a very important point. I intervene to put on the record my desire to be copied in to the response that she receives from the Minister.

[Meg Hillier]

I am sure the Minister will do that, but I am happy to share anything I receive from her. I am sure she will not be writing me secret letters, and even if she told me that she was I would ignore her, so I hope she provides information that is fully public.

There is a real concern about health workers being unable to afford to buy homes. When a group of local MPs met officials from the Barts trust after one of the trust’s more recent crises—it was around the time of, or just before, the general election—we asked them about the release of land for health workers. We got the distinct impression that those running the trust at the time—we have had new management in since—did not think that it was their responsibility to provide housing; the process was just about disposing of the land to fill the black hole in the trust’s budget. However, we know that health workers cannot afford to live in London and work locally; that is often true of doctors on good salaries, let alone anyone on a lower salary. There will be a real crisis if we cannot recruit health workers, and I will touch on that issue in a moment.

NHS England is keen to lay the blame for the financial crisis in acute trusts at the door of agency staff costs. The Secretary of State announced a cap on the pay rate in October, but the National Audit Office found that that is not the underlying problem. We also touched on the matter in a Public Accounts Committee hearing. It is the volume of agency working, rather than the rate paid, that is the bigger problem—the vacancy rate, requiring backfilling with agency workers, rather than the amount that they are paid. No doubt there is an problem there and the NHS should begin—I hope that it is beginning—to use its purchasing power to tackle that, but the foundation staffing model for hospitals, which is designed to fit the budget allocated by the Department, often has too few staff to deliver the required health outcomes. The NAO has uncovered the fact that 61% of temporary staffing requests in 2014-15 were to cover vacancies, not emergency cover.

[Mike Gapes]

Is my hon. Friend aware that the NHS employers and London NHS partnership have this week sent out information stating that nursing vacancies in London are running at 17%, which is 10,000 nurses? The NHS and local trusts are going all over the world to recruit, but the Home Office is bringing in a requirement for people to earn £35,000 before letting them in. Does not that contradict what the NHS is trying to do?

[Meg Hillier]

My hon. Friend anticipates what I was going to say—or perhaps it is just that we are all dealing with the same problems. Will the Minister outline what conversations her Department and NHS England have been having with the Home Office about the issue? We have seen many changes in the immigration rules, and they affect what happens. We should be recruiting and training British citizens and enabling them to earn a living, although I have no problem with other people working in the NHS. When we have problems with recruitment, of course it is right to look overseas, and many of our hospitals are well staffed by people from all round the world; but if those people cannot meet the threshold, they will not be allowed in, and that will cause a problem. I know that it is also causing concern to NHS England. No doubt the Minister is being lobbied; perhaps she can advise us. The cost to hospital trusts of the agency staff who fill in the gaps—they could be full-time workers from overseas or from the UK—has risen from £2.2 billion in 2009-10 to £3.3 billion in 2014-15.

I do not have much time to discuss GPs, but we know that that is a big issue, given the demand on the health service at primary care level in particular. On national figures, recruitment of new GPs is slow and early retirement is a looming crisis. If the Minister has not been alerted to that problem, I hope she will look into it. It is not a new phenomenon, but it is getting worse. Between 2005 and 2014 the proportion of GPs aged between 55 and 64 who left approximately doubled. In addition, there is an increasing proportion of unfilled training places—the figure was 12% in 2014-15—and an increasing number of younger GPs are leaving because the job is becoming untenable, with 12-hour days typical. Many GPs just do not want to do that. We need good access and support in primary care to make it work.

The Public Accounts Committee has recently looked at another issue that is worth highlighting, which is the management and supply of NHS clinical staff. We would acknowledge, although our report is not yet out, that in an organisation the size of the national health service, getting things exactly right will always be complex. The figures and the available data about who is needed, together with the problems that I have mentioned to do with GPs and recruitment of hospital and other health workers, could have been predicted. That is something on which I want the Minister to respond: surely, if there is a prediction, there is a need to be able to react quickly, so that training places are available and people are encouraged to take them up. That way, we would ensure that there were enough health workers.

To return to the issue of housing, it is at crisis point in my constituency. Someone on quite a good income cannot afford to buy or to rent in the private sector and will not have a hope of getting social housing, so we have a vast turnover of people. Young people come and live like students, but when they want a home of their own, a spare bedroom for a child, or just a lifestyle that they think befits their status and age, they move out. We have a crisis across the board, but particularly for the NHS. I hope that the Minister will answer some of my questions about how housing can become a key concern for her Department as well as the Department for Communities and Local Government, which delivers housing. My worry is that if the Minister and her colleagues do not lobby hard, the problem will be forgotten in the overall housing crisis and will become a major crisis for public health and health and wellbeing in London.

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[Heidi Alexander (Lewisham East) (Lab)]

It is a pleasure to serve under your chairmanship, Ms Buck. I know that, on another day, you would be participating in this debate yourself. I congratulate my hon. Friend the Member for Ealing Central and Acton (Dr Huq) on securing the debate and for introducing it in an engaging and wide-ranging way. I commend the excellent contributions of my hon. Friends the Members for Hammersmith (Andy Slaughter), for Edmonton (Kate Osamor), for Ilford North (Wes Streeting), for Hackney South and Shoreditch (Meg Hillier), for Ilford South (Mike Gapes), for Brent North (Barry Gardiner) and for Eltham (Clive Efford). They all expressed their concerns about the quality of care that their constituents receive. It is really good to see my hon. Friend the Member for Ilford South back and to hear his reflections on his experience of the seven-day service. I am not medically qualified, but I want to offer him a bit of advice to help his continued recovery: he should limit his time on Twitter.

Many of us in this Chamber have discussed the NHS in London previously. I cannot but reflect on the fact that, back in 2010, when I was first elected to this place, the NHS was hardly ever raised with me on the doorstep, but at the previous election it came up on every road that I canvassed. It is clear from the many contributions today that the NHS in London is under real pressure. We heard about the huge financial pressure, crumbling buildings and difficulty accessing GP services—and that was just from the Conservative Members.

As a London MP, I know that some of the health challenges that our city faces are specific to the capital. Others, such as the rising hospital deficits and declining staff morale, are symptomatic of problems that affect the whole country and can be traced back to decisions made by this Government and their coalition predecessor.

Let me start with the issues that are specific to London. London is a fast-growing city. More than 1 million more people are living here in 2016 than in 2006. The birth rate is higher in London than in almost every other major European city. London is a city of huge economic contrasts. Some of the wealthiest parts of the country are here, and also some of the poorest.

The vicious cycle that links poverty and poor health is all too evident in the advice surgeries that London MPs hold weekly or fortnightly. Overcrowded, damp housing and low incomes cause depression and anxiety, which place significant strain on the mental health system and the NHS more broadly. London contains diverse communities with different needs, from City workers dealing with stress to recent migrants from war-torn countries, so the NHS in London faces multiple and complicated challenges.

The huge contrast that characterises our city also creates problems in the delivery of health services. The lack of affordable housing, which my hon. Friend the Member for Hackney South and Shoreditch mentioned, and the instability of the rental market makes staff recruitment and retention a particular challenge. The London Health Commission found that NHS staff cited the high cost of living and the lack of affordable housing as two of the biggest barriers to living and working in London.

The sister of a very good friend of mine used to work as a cancer nurse at the Royal Marsden. She lived outside London and commuted into Clapham Junction by train. She then cycled from Clapham Junction because she could not afford the fare to a zone 1 station. Her daily round trip took four hours. It is probably no surprise that she has now moved to a new job in Huddersfield.

Nurses in my constituency rent single rooms in flats, so they can live close to the hospitals where they work. Nurses with families are desperate for social housing because private rents are unaffordable and owning a property is a pipe dream for them. We should use the NHS’s large footprint to solve that problem.

[Meg Hillier]

My hon. Friend underlines my concerns. Is she also concerned about the advent of PropCo? It took land away from Hackney, and we now have no control of it locally. It would do more for health outcomes to turn that hospital land into good-quality housing, rather than luxury flats, which are unfortunately becoming the norm in Hackney.

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[The Parliamentary Under-Secretary of State for Health (Jane Ellison)]

It is a pleasure to respond to a debate under your chairmanship, Ms Buck, I think for the first time.

The debate has been extraordinarily rich, with many excellent speeches from my fellow London Members of Parliament. We have a reasonable amount of time left, so I will try to respond to as many points as I can, but certainly on some I would prefer to write a response after the debate. In particular, I would not wish to give my friend, the hon. Member for Hackney South and Shoreditch (Meg Hillier), the Chair of the Public Accounts Committee, anything but the best information, so I will write to her afterwards about some of the details.

I congratulate the hon. Member for Ealing Central and Acton (Dr Huq) on securing the debate with cross-party support. I echo the words of the shadow Secretary of State: it is a great pleasure to see the hon. Member for Ilford South (Mike Gapes) back in this place. He made typically generous remarks about the NHS staff who cared for him, and we, too, thank them, because he is a popular Member in all parts of the House. We are delighted to see him back.

I am a London MP, so the debate is about my constituents as well. Rightly, hon. Members have taken this important opportunity to champion their local populations and their healthcare needs. However, some consistent threads have run through many of the speeches, in particular on the long-term strategic direction given the nature of London and its population. As well as responding to specific points, I want to give Members a sense of the strategic direction that the NHS wants to take in London, and some of the thinking around that.

The NHS in London serves a population of more than 8 million and spent £18 billion last year. As the shadow Secretary of State and others have said, London’s population is younger than the national average and more mobile, and its transient nature often makes continuity of care harder to achieve. In Battersea, I represent the youngest seat in England, and I see that transient, mobile population all the time, whether they are shift workers or young professionals. There are wide variations between and within boroughs in the health of the population, life expectancy and the quality of healthcare.

I will not attempt to respond to all the detailed points that have been made about housing, immigration and some of other wider determinants of health, but I fully acknowledge the interaction of all such important factors when it comes to the health of our constituents, and those factors are rightly at the forefront of the ongoing mayoral election campaign. It is inconceivable that the next Mayor of London, whoever is elected, will not have right at the top of their agenda issues such as housing in London, especially for key workers and the people who keep our important public services going. That is entirely right. I acknowledge that some of the issues that have been highlighted are important for the future of London. The population of London is projected to increase to more than 9 million by 2020, with the largest proportional increase expected in the over-65 age group. Members clearly know what that means for the increasing demand for healthcare.

The leaders of the national health and care bodies in England have set out steps to help local organisations plan over the next six years to deliver a sustainable, transformed health service. I accept that there was controversy in the last Parliament, and that the majority of Members present in the Chamber today disagreed with many of the measures enacted. Nevertheless, we have since had a general election and a majority Conservative Government were elected, having stood on the NHS architecture as it is. At the heart of the Conservative manifesto was an acceptance of the NHS in England’s own plan for its future, the five-year forward view. In a fixed-term Parliament, that gives us the opportunity for a stable system, which can look ahead across five years at how it provides sustainable and transformed services.

As in previous years, NHS organisations will be required to produce individual operational plans for the next financial year. Obviously, that work has happened for 2016-17. In addition, every health and care system will be required, for the first time, to work together to produce a sustainability and transformation plan, which is a separate but connected strategic plan covering October 2016 to March 2021. Many Members have highlighted the frustrations felt between the acute sector and CCGs, and some of the other stresses and strains between the different parts of the system. This year will be the first time that the NHS has required all parts of the local health and social care system to sit down together to draw up a five-year plan. That is strategically important in understanding how the system responds.

Those local plans represent an ambitious local blueprint for implementing NHS England’s five-year forward view locally. My hon. Friend the Member for Sutton and Cheam (Paul Scully) and many others talked about the need for long-term planning.

[Meg Hillier]

I thank the Minister for giving way, because I know she is trying to cover a lot of ground. Long-term planning is sensible, but is she not concerned about a five-year plan when at the same time major transformation is being required of acute hospital trusts through NHS Improvement—again, not a problem in itself, except that it is to be in very short order? Is there not a contradiction between a five-year plan and the short-order demands of the improvement plan for trusts, just to make their books balance?