Privatisation of NHS Services

Debate between Paula Sherriff and Richard Graham

Monday 23rd April 2018 Westminster Hall

[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.