Hospice Sector: Fiscal Support and Cost of Living

Neil O'Brien Excerpts

Thursday 2nd March 2023 Westminster Hall

[The Parliamentary Under-Secretary of State for Health and Social Care (Neil O’Brien)]

It is a pleasure to serve under your chairmanship, Mr Paisley. I congratulate the hon. Member for North Ayrshire and Arran (Patricia Gibson) on securing this debate and thank her for the support that she gives to the palliative, end-of-life care and bereavement sectors. The Minister for Social Care, my hon. Friend the Member for Faversham and Mid Kent (Helen Whately), is unfortunately unable to be here today, so I am here to represent the Government. I extend my gratitude to all Members here today for their contributions, which I have heard and learned from. I pay tribute to my own local hospices in Leicestershire, LOROS—the Leicestershire and Rutland Organisation for the Relief of Suffering—and Rainbows, for the work that they do.

The Government are acutely aware of the pressures and challenges posed by the rising costs that have been mentioned in today’s debate. While they affect us all in every sector, the impact on the hospice sector has rightly been raised for debate. Everyone here recognises the incredible importance of palliative and end-of-life care services, and the invaluable work that hospices, charities and the people who support them do to ensure that dignity, care and compassion are present in our lives when we need them most.

The efforts of organisations such as Hospice UK and Together for Short Lives play a vital role in ensuring that we as a nation provide world-leading palliative and end-of-life care. Like pretty much everyone in the country, I thank them. I take this opportunity to say thank you for everything that they do.

The hospice sector supports more than 200,000 people with life-limiting conditions in the UK each year, as well as tens of thousands of family members with bereavement support. We know we have an ageing population presenting with more complex health needs for more years of life. On average, about 600,000 people die every year in the UK, and that number is expected to increase. With that expected increase, the number of people needing palliative care is also likely to rise. Health is of course a devolved policy area, so in terms of direct hospice policy, I can only speak to the English experience, although I will of course talk about some UK-wide areas that are highly relevant, such as energy policy.

While so much palliative and end-of-life care is provided by NHS staff and services, hospices also provide significant support to people at the end of their life and to those important to them. They are mainly independent charitable organisations that receive funding from a mix of public sources and charitable donations. The sense of purpose that is shared with the community—the community cares for the hospice and the hospice cares for the community—is something that we should cherish. I see that strongly in my constituency. It is emblematic of the incredible rallying of compassion and care that we see around hospices all over the country. We should also note the important role that hospices played at the height of the covid pandemic when considering their important place in their communities.

In England, integrated care boards are responsible for commissioning end-of-life and palliative care services to meet the reasonable needs of their local populations. In the Health and Care Act 2022, palliative care services were specifically added to the list of services that an ICB must commission. That will ensure a more consistent national approach and support commissioners in prioritising end-of-life and palliative care, as hon. Members have called for. In July 2022, NHS England published new statutory guidance on palliative and end-of-life care to support commissioners with that new duty. It includes specific reference to ensuring the sufficient provision of specialist palliative care services and hospice beds, and ensuring their future financial sustainability.

I recognise the importance of quality palliative and end-of-life care for children and young people. NHS England is investing £23 million via the children’s hospice grant by March 2023, rising to £25 million by 2023-24, in order to provide care close to home for seriously ill children when they need it.

On the question that the hon. Member for Twickenham (Munira Wilson) asked, although we only set out funding to date in the spending review, that does not mean that all funding will be cut off at that point. We are exploring exactly how that funding will be provided in the future. Furthermore, this financial year, NHS England has made £5 million of match funding available to ICBs for local children’s palliative and end-of-life care services. That will rise to £7 million in 2023-24, demonstrating the value of those services.

The funding of hospices and the sector is indicative of the Government’s commitment to their work and the vital societal role that they play. We recognise, however, that hospices, like every other organisation and household across the country, are having to contend with a range of budgetary pressures, including huge energy costs following the Russian invasion of Ukraine.

[Munira Wilson]

I thank the Minister for addressing one of my key questions about the children’s hospice grant. I am sure the sector will be grateful to hear that it is expected to continue. Although hospices will understand that he cannot commit to that at this stage, the problem is that if they do not know what they will get for the next three to four years, how can they make plans for their workforces and services? Will he say anything more than that something will continue? I do not know whether he is coming to this, but will he also say something about the ringfenced grant being administered directly, rather than via ICBs?

[Neil O’Brien]

Those are both really important points. The hon. Lady knows that it is not for me to set out the future of funding, but I hear the points she makes about ensuring that funding flows to hospices and that they are prioritised by ICBs, and about providing as much certainty as quickly as possible. Both those points have landed with me.

To meet the energy pressures, the UK Government’s energy bill relief scheme provides a price reduction in wholesale gas and electricity prices for all UK businesses and all other non-domestic customers. That means that they will pay wholesale energy costs below half of the expected prices this winter. A new scheme—the energy bills discount scheme, which has been mentioned— was announced in January, ahead of the current scheme ending in March. It is intended to help hospices’ budgetary planning into the future and provide certainty. That follows a Treasury-led review of the energy bill relief scheme some months ago.

The energy bills discount scheme will provide all eligible non-domestic energy users, such as hospices, with a discount on high energy bills until March 2024. It will apply to all UK domestic energy users in the voluntary and public sector, including hospices. We will invest up to £5.5 billion to support those non-domestic users. Furthermore, hospices may also be entitled to a reduction in VAT from 20% to 5% and exclusion from the main rates of the climate change levy on the energy they use for non-business purposes, as long as they meet the criteria in the scheme.

In addition to those two specifically energy-focused interventions, in 2022 NHS England released £1.5 billion in additional funding to ICBs to provide support for inflationary pressures, with local ICBs deciding how best to distribute that funding according to local need, including to palliative and end-of-life care providers such as hospices. I have previously mentioned the steps we have already taken in legislation and guidance to ensure that hospices are prioritised by ICBs.

A large part of hospice activity—probably the majority—actually takes place in people’s homes. That is why we are also taking action on domestic energy pressures. In fact, this winter we are spending a total of £55 billion to help households and businesses with their energy bills. That is among the largest support packages in Europe. A typical household will save about £900 this winter under the energy price guarantee, in addition to the £400 energy bill support scheme for households. On top of that, we are also spending £9.3 billion over the next five years on energy efficiency and clean heat, making people’s homes easier and cheaper to heat.

To help with some of the other cost of living pressures on households—which is the last thing people need when they are in need of hospice care—we are taking measures such as the extra £900 cost of living payment for 8 million poorer households, the largest ever increase to the national living wage for 2 million workers, and a total of £26 billion for cost of living support next year. I hope some of these supportive measures will reassure Members about the Government’s commitment to the sustainability of the hospice sector, particularly during this challenging fiscal period. I understand that the rising cost of living has caused all kinds of uncertainties, and we continue to engage proactively with the sector to try to understand the issues it faces.

[Munira Wilson]

Will the Minister give way?

[Neil O’Brien]

I will close my speech by again expressing my thanks to those who have attended the debate—including the hon. Lady, to whom I now give way.

[Munira Wilson]

I thank the Minister for giving way again. On his point about the energy bill relief scheme, will he at least acknowledge the absurdity of leaving hospices out of the energy-intensive grouping, while botanical gardens, zoos and museums, deserving though they are, have been included? Does he not recognise that that is utterly absurd, given the sort of services that hospices are delivering?

[Neil O’Brien]

Although this is not my policy area, as I understand it, this applies to the energy-intensive and the traded sectors, so organisations need to pass through two different filters to qualify: they have to be very energy intensive and in the traded sector. That would explain the organisations that are chosen or not chosen, but as I said earlier, I absolutely hear the point that the hon. Lady is making.

I pay tribute to all those working in and supporting the palliative and end-of-life care sector and providing essential support to those who need it. I hope I have reassured Members of the Government’s commitment to supporting these invaluable services.