Privatisation of NHS Services

Paula Sherriff Excerpts

Monday 23rd April 2018 Westminster Hall

[Mike Hill]

As a member of the Petitions Committee, I am independent; as a Labour MP, I agree. I will come to that point later.

Private practice is only one aspect of the worrying trend towards the increased privatisation of NHS services. As the BMA points out, the recent legal action that Virgin Care brought against several clinical commissioning groups should serve as a stark reminder of what can happen when the relationship between the NHS and the private sector sours.

[Paula Sherriff (Dewsbury) (Lab)]

My hon. Friend is being very generous in giving way. Many Members know that I worked in the NHS for more than 10 years. That service was privatised and taken on by Virgin Care, which destroyed it. What concerns me is that I have given Conservative Health Ministers, including the Secretary of State, the opportunity to talk to me on a number of occasions about Virgin Care’s many failings, some of which were very dangerous, but they have never taken up that opportunity. Does my hon. Friend share my concern?

[Mike Hill]

I certainly do share my hon. Friend’s concern. Ironically, in my patch, sexual health services are delivered by Virgin doctors.

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[Paula Sherriff]

Will my hon. Friend give way one more time?

[Mike Hill]

One more time.

[Paula Sherriff]

I want to be clear about some of the dangers of privatisation. When Virgin Care took over our dermatology service, it would not subscribe to the SystmOne computer system, so we had to use another system, which was not operable for more than a year. Patients were coming in, but we had no idea what they were coming in for—we had to ask them questions such as, “Is the lesion on your left or right arm, or on your leg?” That is particularly difficult with patients who have dementia or learning difficulties, for example, and it represents a significant hazard to patient safety.

[Mike Hill]

I am glad that my hon. Friend mentioned such issues, and dementia in particular—mental health care needs to be looked at for investment.

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[Paula Sherriff]

Going back to my hon. Friend’s point about fragmentation, the service I worked in had pathways to the acute trust, so that if somebody came to us with something that looked malignant, we could refer them to the acute trust and the patient would have an appointment within two weeks. When Virgin took over the service, there was no aspiration or desire from the people at the top to create those pathways, so the patient had to go back to the bottom of the waiting list. Ultimately, it is a lose-lose situation for patients.

[Graham P. Jones]

My hon. Friend makes a powerful point and states the case well. My caseload of NHS issues is rising, and often they are about the gaps in service because of that fragmentation. Sometimes it is about poor service, or privatised services that are not providing what people once received when they were under the NHS. It is a complete disaster for my constituents; I have yet to meet a constituent who says that the changes since 2012 have improved the health service and are for the better. Everyone who comes to me—from all parties, of all types and from all walks of life—says exactly the opposite. The fragmentation, the lack of accountability and the cuts need to be looked at again. Healthcare inflation is outstripping the money going into the NHS, resulting in cuts and the STPs.

We are getting a different provider model for our local walk-in centres—it is starting to be swapped again. Our centre is a much-valued service but it is being closed, despite 23,000 people signing a petition. Its 42,000 patient visits will be transferred somewhere else—perhaps off to the second busiest A&E in the country. At the same time as all the fragmentation and chaos, we found out this week that in Clitheroe, the out-of-hours GP service is about to be closed, with patients being told to go to Accrington.

The fragmentation of our NHS is a complete and utter disaster. We are trying to outsource and privatise services or shift them to another trust and shuffle them around to try to save some money, but that will not save money. A patient visit at Blackburn A&E costs £120; it costs £60 at the walk-in centre. The change is a false economy. We shift more patients at the walk-in centre, but it is going to close. Where in all this is a system that is not fragmented, that is holistic and that thinks about the patient and puts them first? I completely agree with my hon. Friend the Member for Hartlepool: it is about time that we revoked section 75 of the Health and Social Care Act.

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[Faisal Rashid (Warrington South) (Lab)]

It is a pleasure to serve under your chairmanship, Sir Graham. I congratulate my hon. Friend the Member for Hartlepool (Mike Hill) on bringing the petition forward for debate.

I thank the 237,462 individuals who signed the petition and gave us the opportunity to raise the issue of NHS privatisation, which is important for many of my constituents. I know that the same is true for all Members present. The petition was signed by 442 of my constituents, and I was proud to join 200 of them outside Warrington Hospital in February to protest against NHS privatisation. The level of public concern about this issue shows just how important the NHS is to our country and its citizens.

The NHS is our most sacred and treasured institution. It was founded 70 years ago on the fundamental principle that everyone is entitled to free healthcare, and it does not discriminate on the basis of wealth, gender or race —it does so only on the basis of need. Every day, thousands of lives are saved by NHS staff at NHS hospitals, and we are extremely grateful for their extraordinarily hard work. The Government have a duty to protect the NHS and its staff, and to ensure that they can continue to provide world-class healthcare to the British public, free at the point of use.

We all use the NHS, and we all have a vested interest in ensuring that it is run effectively and efficiently, but let us be clear: privatisation and outsourcing do not do that.

Privatisation forces NHS hospitals to outsource vital services to private companies, which are often more interested in making a profit than helping sick people. That is a fundamental conflict of interest. The NHS has a duty to its patients, whereas private companies have a duty to their shareholders, but shareholders care about profits, and often the only way to make a profit is by cutting corners. That compromises the quality of care.

The Government claim that private sector outsourcing is good for the NHS and that it allows patients access to treatments based on the best quality of care and value for money.

[Paula Sherriff]

My experience is that we used to offer one-stop surgery shops, so that when patients came in they could have minor surgery on the same day. We were stopped from doing that. Patients had to come in on two occasions, and we were told explicitly by the management of Virgin Care that it was because it generated two tariffs, and made more profit. I should be interested to hear the view of those who defend the privatisation of healthcare about that.

[Faisal Rashid]

That supports my point, and is a great example.

The Government view of outsourcing does not reflect the reality of privatisation. Did patients receive the best quality of care from the private firm Circle when it took over management of Hinchingbrooke Hospital in 2012, making it the first privately run NHS hospital, only to withdraw from its contract two years later after it was placed in special measures by the Care Quality Commission because it had found serious failings in its emergency and medical care services? What about the 2013 Public Accounts Committee report on Serco’s running of GP out-of-hours care in Cornwall, which accused the private company of bullying employees, providing a short-staffed and substandard service, and manipulating data to hide the truth? Were patients receiving the best quality of care then? What about the imposition of financial penalties on the same company by NHS commissioners in Suffolk in 2014, after it missed key targets in its community health services contract? In 2012 Harmoni, a private provider of NHS out-of-hours GP services, having put in place an aggressive cost-cutting agenda, faced allegations from senior doctors that its service in London was so short-staffed that its patients were unsafe. I could recount many more examples of failed healthcare privatisation, but we do not have time.

The Government also claim that outsourcing allows the NHS to save money, but that is not necessarily true. The process by which private companies bid for contracts allows them effectively to cherry-pick the most profitable forms of treatment—usually low-risk elective surgeries. That allows the private sector to benefit from the predictable, and usually low, cost. That is far from providing the best quality of care for patients.

Why, then, do the Government insist on continued NHS privatisation? Since 2010, under successive Conservative-led Governments, the private sector’s involvement in NHS services has more than doubled. Evidence shows that that has seldom made the situation any better for staff or patients. The NHS is in crisis. Chronic underfunding compounded by a growing and ageing population has put an unbearable strain on the NHS and resulted last year in yet another winter crisis. My local NHS Trust, the Warrington and Halton Hospitals Trust, is on track for a forecast financial deficit of £16.8 million, and in December 2017 only 73.8% of A&E patients were seen within four hours, which is well below the target. Yet the Government’s only answer to the crisis is more privatisation.

Let me review the facts. Privatisation is bad for quality, budgets and the NHS. More privatisation is not going to help the NHS. The only way to help it is to give it the funding that it needs and that it has been telling us it needs. If we truly love the NHS, we will stop privatisation.

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[Richard Graham]

I thank the hon. Gentleman for his comments. That is part of an issue that he is certainly keen to discuss, and part of what is in the petition.

The point I was going to make, which is relevant to that, is that there is a difference between sensible, profitable and innovative businesses and profiteering. There has been, in my view, one clear example of profiteering taking place in the NHS since 1948. It came with the private finance initiative policy during the new Labour period of Blair and Brown, which brought capital into the NHS that was off balance sheet and not recorded in the public finances, at exorbitant cost. It saddled hospitals around our country with interest rates that they could not afford to pay back, and it was the Conservative-led coalition Government who did what was legally possible, although not as much as any of us in this House would wish, to dismantle those contracts.

I think I am right in saying that we took out about £2 billion of costs a year by renegotiating the PFI contracts that could be renegotiated—somebody may know the precise figure. Opposition Members, some of whom were here at that time, should be ashamed of their complete responsibility for introducing the only obvious example of profiteering that has happened in the NHS since it was created.

[Paula Sherriff]

I wonder whether the hon. Gentleman is attempting to remove the architect of privatisation within the NHS, who I understand was Sir John Major. I agree with the hon. Gentleman about PFI; there have been some arrangements where it is difficult to argue that value for money is being achieved. But we must remember history, and it was Sir John Major who introduced the PFI scheme.

[Richard Graham]

I am happy for the hon. Lady to correct the record on John Major’s introducing PFI, but the point about PFI and all private financing is that the devil is in the detail. The principle of bringing private finance into the public sector is fundamentally a good one and approved of by, I think, all major parties. I am afraid that what went wrong during the 13 years of new Labour, as she knows and has implicitly agreed, was rampant exploitation of the NHS, with public servants signing agreements that frankly should never have been signed.

That is in the past—the fairly recent past, but the past. We have moved on since then. Since the petition was written, other things have also moved on. The most important is the issue of pay, with the Government committing several billion pounds from taxpayers to give 1.1 million NHS staff significantly higher pay over the next three years. I think we all strongly applaud what has happened—we know what an enormous job the NHS does in all our constituencies.

I will briefly raise what matters more in the longer term about the NHS, a subject that this petition could have tackled. The real issue is the long-term funding of the NHS. As a nation, we cannot lurch from year to year with the Secretary of State for Health and Social Care effectively going cap in hand to the Chancellor of the Exchequer for more cash to bail out the NHS. We need a longer-term, agreed basis on which to fund the NHS; I suggest at least five and ideally 10 years, so that everyone can plan ahead on what is needed to fund our NHS, with cross-party consensus. That way, never again can we face a situation in a general election of leaflets saying, “24 hours to save the NHS”. It is an old bogeyman that we must do away with.

I believe that the only effective way to do that is by bringing in equal contributions from the self-employed as well as the employed, and from those still generating income over a certain limit in retirement, through a dedicated source of funds or a hypothecated fund. The most obvious of those is national insurance, which does not really insure anybody for anything. It should be renamed the NHS fund. I put that proposal to our party before the last general election; understandably, there was not really enough time for it to be seriously considered. It would be a major change of direction and one not entered into lightly. There would be huge challenges with it. For example, what would we do in times of high unemployment, such as 2008 to 2010? Could the Budget effectively top up the NHS fund in such times?

That is why I am so pleased that the King’s Fund is researching that very issue now—would it be possible to have a hypothecated fund to fund the NHS? Would national insurance be a good starting point? What sorts of hazards and potential would that throw up? The King’s Fund report will be an important guide to hon. Members on both sides of the House about whether we can look at having a serious, long-term source of funding for the NHS around which we can have consensus, so that some of the endless debates and arguments, particularly around the word “privatisation”, can be dealt with and we can know that we have a source of long-term public funding for our NHS.

That is where I wish to finish. I regret attempts by some Opposition Members to try to create differences between political parties on something as precious as the NHS. All of us—all our families and all our constituents, wherever we were educated, whatever sport we like, whatever job we have and whatever sort of retirement we have—depend on the NHS for our health and, I contend, for our care as well. That is the other reason we need to find a hypothecated source of funds for the NHS—so that it can deal with care as well. That is a subject that the Health Secretary is wrestling with in his Green Paper as we debate. That is why in today’s debate we should leave the partisan efforts at point-scoring on privatisation and focus on what we can all contribute to the bigger debate about a long-term source of funding for a fully publicly owned NHS.