Health and Care Services

Debate between Phillip Lee and Stephen Dorrell

Wednesday 3rd July 2013 Commons Chamber

[Mr Dorrell]

I do not wish to detain the House for the whole of the time available for this debate, but my hon. Friend raises an important question about how that demand is made up. The interesting thing about the drivers of demand—rising expectations, the cost and availability of modern medicine and the implications of an increasingly elderly population—which each new Front-Bench spokesman reveals as a newly discovered truth, is that they were first discovered by Rab Butler when he became Chancellor of the Exchequer in 1951. He set up a commission to ask whether the health service was an insupportable burden. The conclusion reached then, and by every successive Government since, in this and in similar processes in other countries, is that demand can be met, but it requires a serious analysis of the nature of the demand and how resources are used effectively to deliver it.

There is a danger in discussing health and care as if they were purely an economic question, especially for those of us who have been employed in the Treasury—like you, Madam Deputy Speaker, and me. There is a danger of sounding like a Treasury Minister and implying that the economic questions are the only issues in this regard. I need only offer names to the House to demonstrate that economics is not the only issue here—Winterbourne View, Mid Staffordshire and Morecambe Bay. Our system faces huge challenges, not just to do with economics but in respect of the quality of service that is delivered on a daily basis. Put simply, it is not enough just to go on delivering the service as it is now because, too often, it fails. Implicit in the Nicholson challenge is the requirement to face profound quality challenges, as they exist in the system, at the same time as squaring the financial circle I have been describing. In some quarters, it is suggested that that is a counsel of despair—that the circle is unsquareable.

The Committee disagrees, which is why the report states, at paragraph 30:

“At a time when steadily rising demand for health and care services needs to be met within very modest real terms funding increases for the NHS and even tighter resource constraints on social care, the Committee remains convinced that the breadth and quality of services will only be maintained and improved through the full integration of commissioning activity across health and social care.”

In other words, it is the Committee’s cross-party view that it is the integration—the reimagining of what health and care need to look like—that is the answer to the questions posed both by the Nicholson challenge and the quality challenges implicit in the names that I mentioned. It is important to be clear why that is the Committee’s view.

Efficiency, as implicit in the context of the Nicholson challenge, is not just about buying a bit more cleverly or holding down costs. It is about understanding what the demand is that we are trying to meet and putting in place the structures—incidentally, I do not mean the management structures—for the delivery of care that are likely to be able to meet the demands placed on them, not over the last 50 years but over the next 20. It is reimagining and driving a process of change through the health and care system that is the only realistic challenge to the financial and quality challenges that I have articulated.

[Dr Phillip Lee (Bracknell) (Con)]

Talking of efficiency, is my right hon. Friend as shocked as I am to hear that the Department of Health spent almost £74,000 on outside consultancy to prepare for just one Public Accounts Committee hearing? If that is the case, the Department might want to lead from the front on efficiency.

[Mr Dorrell]

I am sure that my hon. Friend will forgive me if, faced with an estimate of £103 billion, I do not go through every £70,000 of expenditure. However, he has made his point.

This is where I believe the Committee has held the Government to account, although not always comfortably for the Government of the day. There is no solution to the Nicholson challenge purely through adjusting the numbers—to use a non-emotive phrase. It has been reported to the Committee that in the first two years of the Nicholson challenge, 73% of the efficiencies that have so far been delivered are attributable as follows: 16% to pay freezes, which is the point made by my hon. Friend the Member for St Ives (Andrew George)—yes, holding down wages does reduce the cost of delivery and is, in the short term, a form of economic efficiency, but it is not a long-term solution to the Nicholson challenge—and, most implausibly, 45% to just changing the tariff between the commissioner and the provider. That is not an efficiency; that is an internal transfer, a bookkeeping entry, accounting, make believe. Another 12% over the two years is put down as “other”, which is an old accounting technique for concealing not very much, usually.