2019 Loan Charge

Debate between Steve Baker and Phillip Lee

Tuesday 20th November 2018 Westminster Hall

[Mr Baker]

I join my right hon. Friend’s call for the Minister to set that out, which my hon. Friend the Minister will have heard. I will now make some progress.

The Loan Charge Action Group says that the human impact of receiving a bill for up to 10 years’ worth of tax will have a catastrophic effect on individuals and their families. On whom among us would it not have a catastrophic effect? It goes on to say that we are looking at thousands of bankruptcies, family break-ups and suicide attempts, as well as mental illness, unemployment, loss of abode and more. That is a catalogue of human suffering and misery.

HMRC’s impact assessment of the measure says:

“This package is not expected to have a material impact on family formation, stability or breakdown.”

However, that looks at aggregates, not the impact on individuals, which it seems to me is a common mistake of Government. As a Conservative, I wish to focus first and foremost on the individual, not the collective.

I will foreshorten my remarks, given the interventions I have taken. One specific complaint is the lack of warning. A freedom of information request revealed that HMRC has issued about 23,000 loan charge awareness letters, which were only issued from the second quarter of 2018. HMRC says that 50,000 individuals may be affected, so many will be unaware of the impending charge. The Loan Charge Action Group points out that the opportunities to settle new tax affairs with HMRC ahead of the charge were similarly not widely publicised, nor was the deadline of 31 May 2018, leaving people in a terrible fix, although I understand that the deadline has been quietly dropped.

The Loan Charge Action Group suggests that historical users of schemes who left many years ago are probably completely ignorant of this new legislation and will only hear of it after receiving a large bill some time in 2020. This is a dreadful risk, which the Government should forestall.

I am keen to conclude, so I will come to some solutions that I ask the Minister to consider. As I outlined in a letter to the Chancellor in September, there should be clarity about what DOTAS—disclosure of tax avoidance schemes—registration means. There should be a legally mandated text accompanying every advertisement of a DOTAS-registered scheme that explains that the purpose of registration is to enable HMRC to identify tax liabilities and to recover them when such schemes are proven not to work. It does not imply any kind of legitimacy, and registration with HMRC is not for the purpose of endorsing the schemes. When HMRC becomes aware that a taxpayer has subscribed to a DOTAS-registered scheme, it should contact the taxpayer and make them aware that registration has the purpose of enforcement and does not convey legitimacy. HMRC must take into account people’s circumstances, and the threat of insolvency should never be used as a kind of extrajudicial punishment.

[Dr Phillip Lee (Bracknell) (Con)]

On treating individuals fairly, it is pretty evident that the people who have been selling these questionable products are not being pursued in the way that they should be. In view of that, does my hon. Friend agree that the Government should start looking at mitigation, so that certain individuals—I know of a couple in my constituency—are not bankrupted by this whole sorry affair?

[Mr Baker]

The Minister will have heard my hon. Friend’s point, which I endorse.

The loan charge should apply from Royal Assent onwards. In other words, it should be prospective—a case I have made many times—not retroactive or retrospective. HMRC should be more proactive in advising that such schemes are likely to end in tax charges in the future, and perhaps far into the future. More steps should be taken against promoters and introducers of such schemes. They are the ones profiting from this misery. Finally, the issue of employment status and IR35 requires action at last, to bring the uncertainty to an end.

Acute and Emergency Services

Debate between Steve Baker and Phillip Lee

Friday 26th October 2012 Commons Chamber

[Dr Phillip Lee (Bracknell) (Con)]

NHS hospitals face mounting financial, work force and demographic pressures. The stark reality is that health care provision in the future will require consolidation of acute and emergency services in fewer locations, and an increase in the provision of chronic care in the community through locally based clinics. That is not a political choice, but a clinically driven reality. It is widely believed among those in the medical profession that the reconfiguration of hospital services can provide a powerful means of improving quality in an environment where money and skilled health care workers are scarce. In some places, reconfiguration and changes to hospital services are already a necessity, not an option.

That is the case in the Thames Valley region, of which my Bracknell constituency is part. That is why I have recently introduced a strategy proposal for the provision of health care in the Thames Valley region, in which I call for a consolidated hospital—what some have described as a super-hospital—on the M4 at junction 8/9. A “Royal Thames Valley hospital” at this location, if it is ever built, would have crucial advantages. The existing transport infrastructure means that services could be provided, within easy reach of people’s homes, to a population of the greatest possible size. This model has a multitude of benefits, which include economies of scale and sharing of medical information and manpower, and it is supported by many senior medical professionals as being the key to saving the national health service.

Nevertheless, I sense a lack of the strategic leadership that is required to deliver the change that we all need. A major stumbling-block in many hospital reconfigurations is public concern about change, and the political opposition that follows. Politicians will have to make decisions on the basis of the quality, safety and efficiency of health care, while retaining strong public engagement in decision making. That is why I have already begun to hold regular public meetings throughout the Thames Valley region.

[Steve Baker (Wycombe) (Con)]

As my hon. Friend knows, he has set a number of hares running in my constituency. Will he concede that a number of NHS professionals, managerial and clinical, differ with him and think that a network of hospitals is an effective and incremental way forward?

[Dr Lee]

I thank my hon. Friend for that intervention. Yes, I concede that some—not many—local clinicians share that view. Whenever one presents something different that is a challenge to the status quo, one will come up against vested interests, particularly in the national health service. Many of my colleagues in the Chamber need to start engaging with the public on the issue. It is coming round the corner, and we should all try to provide the political environment in which the change can take place.

I would like first to set the context, say why I support this change, and talk about the current difficulties in our health care system, and those that we will face in the future. In the past 50 years, according to the King’s Fund, the number of acute hospitals has reduced by 85% and the number of sites at which elements of highly specialist care is delivered has reduced even further. In England, general acute care is now delivered in just over 200 hospitals, and at the same time the average size of hospital has grown from 68 beds, according to a Ministry of Health document in 1962, to just over 400 beds. The average acute trust has just over 580 beds. These changes reflect developments in medical practice.

Advances in medicine and surgery have driven clinical staff and equipment to become more specialised. As skilled specialist staff are scarce and budgets are limited, services have been centralised on to fewer, larger sites, in order to ensure that patients are cared for by staff with the necessary skills and supporting specialist equipment. In addition, there has been decreasing reliance on bed rest as part of treatment; for example, most routine surgery is now undertaken as day surgery. The average length of stay in hospital is currently just less than six days and 80% of all patients have stays of less than three days.

Having surveyed both NHS trusts and the public on service change, the Foundation Trust Network found that 90% of NHS trusts said that a major change, such as a hospital merger, closure or changing the way in which services are provided, was necessary in their area in the next two years. Critically, eight in 10 trusts felt that a reconfiguration in their area would lead to maintained or improved patient outcomes which would not be possible if the change did not take place. Of those NHS trusts indicating that a reconfiguration would be necessary, 35% felt that there was a consensus locally about how this should take place. Local councillors were felt to be a barrier to service change in 49% of cases, as were other NHS trusts in 48% of cases, and MPs in 40% of cases.

Finally, market research organisation ICM’s polling of the public shows conflicting views. Four out of 10 people initially stated that they would prefer to be treated locally, but when asked to rank the importance of having services close to home versus accessing specialist care when being treated for a serious condition, more than half said that it was more important to be treated in a unit that specialised in their treatment area. That number rose to 60% if the respondent was talking about a loved one receiving the treatment rather than themselves. Three in 10 said that it was most important to have a hospital close to where they lived in such a case, suggesting that while people value the convenience and accessibility of local care, ultimately access to specialist expertise matters more where a serious condition is involved.

Demographic changes and the shifting burden of disease will require a fundamental shift from the hospital as the core focus of health service delivery to the community, to provide elective care and minor treatments from the community level in much-cherished community hospitals, and all major surgery and acute care from a central hub hospital, ideally located on a motorway.

In any reconfiguration of hospital services there are four drivers: quality—that is, better health care—work force, cost and access. The challenge is to try to arrive at a configuration that optimises all those elements as far as that is possible, given the complex trade-offs that exist between them. Quality considerations include access to highly trained professionals in all disciplines, compliance with clinical guidelines, and access to diagnostic technologies and other support services, as well as strong clinical governance. More recently, there has been pressure on trusts to meet challenging funding needs, which is putting greater emphasis upon operational systems and environments to work together to meet the targets and improve patient safety in acute care settings. There are also interdependencies between services—for example, withdrawal of paediatric services can threaten obstetric services, which rely on paediatricians to provide care for the newborn child.

There is wide variation in the quality of care delivered by NHS hospitals. Reconfiguring services can be a powerful means of addressing this variation. An often cited successful example is here in London. It has been estimated that the recent reconfiguration of stroke services will save more than 400 lives a year. This is through the establishment of stroke networks that have concentrated specialist stroke expertise and diagnostics in fewer units, while retaining local access to stroke rehabilitation services in local community hospitals. Other examples include vascular surgery, where the mortality rate is lower in high-volume hospitals than low-volume hospitals, and paediatric heart surgery, where there are plans to cut the number of hospitals undertaking surgery to improve outcomes.

With reference to stroke mortality rates across acute hospital sites across England, it is estimated that there would be 2,117 fewer deaths per year from stroke in England with increased ambulance services to specialist centres. That clearly demonstrates that centralisation of stroke and trauma centres would benefit a larger proportion of the population and would reduce mortality rates and thereby improve the quality of care.

Alongside those changes, there is a need to shift the location of care for older people who do not require specialist care in a hospital setting. The Royal College of Physicians estimates that almost two thirds of people admitted to hospital are over 65. People over 85 account for 25% of bed days. As we have noted, older people make up the majority of patients in hospital beds, yet many could be cared for elsewhere if appropriate facilities were available. In particular, end-of-life care illustrates the inappropriate use of hospitals. Notwithstanding recent increases in the proportion of people dying at home, many still die in hospital even though they would prefer to be cared for in a hospice or their own home. One of the challenges in this regard is to make community services available 24/7, to stop hospitals becoming the default setting because of a lack of other options.

I will move on to work force pressures. Since the application of the European working time directive to junior doctors, there has been a 50% increase in the number of junior medical staff required to fill a rota and provide 24/7 care, which many units have struggled to achieve. According to a report by the Royal College of Physicians, three quarters of hospital consultants report being under more pressure now than they were three years ago and more than a quarter of medical registrars report an unmanageable work load. I draw colleagues’ attention to the report, “Hospitals on the edge? The time for action”, which is well worth a read and should be borne in mind when discussing or defending local hospital services.

Recruiting into emergency medicine is also becoming difficult and application rates into training schemes involving general medicine are also in decline. According to the RCP, there is an increasing reliance on locums and unfilled consultant posts. That will have a negative effect on emergency care, which is vital to all. There is also an increasing recognition that services such as emergency surgery might be unsafe out of hours, and the provision of those services needs to be concentrated in fewer centres that are better able to provide senior medical cover.

Improving the quality of care often entails making available senior medical cover in some services on a 24/7 basis. That in turn means reducing the number of hospitals providing those services, to enable consultant medical staff to operate effective rotas in the evenings and at weekends. That would also reduce mortality rates, as most deaths happen on poorly staffed wards at weekends. The most contentious issues concern changes in the provision of accident and emergency and maternity services because of the importance attached to those services by patients and the public. Many of the changes derive from work force shortages, for example among consultants and midwives, making the current model of care unsustainable. That is leading to increasing differentiation in how services are provided. For example, some hospitals provide midwife-led maternity care and others no longer provide accident and emergency services at night.

I will now move on to cost. The merger of particular services, such as intensive care, A and E services and cardiac surgery, could improve quality and save money. NHS London, for example, has demonstrated that the recent reconfiguration of stroke services has achieved an improvement in quality as well as significant cost savings. The Department of Health estimates that in the last quarter of 2011-12, 10 out of 72 NHS acute and ambulance trusts were rated as “underperforming” or “challenged” on their financial performance. Of 143 foundation trusts, Monitor reports that 10 had a financial risk rating of 1 or 2—on a scale of 1 to 5, 1 being high—and that 11 were in breach of the terms of their authorisation on financial grounds. Twenty trusts have declared themselves unviable in their current form, including Heatherwood and Wexham Park Hospitals NHS Foundation Trust, which serves part of my constituency.

One of the most comprehensive reviews for clinical and financial evidence was Lord Darzi’s review of the NHS. He argues that future technological advances will result in an expanding number of diagnostic tests and therapies that could be provided more cost-effectively in a smaller number of regional specialist centres, such as the one I have suggested for junction 8/9 on the M4, rather than a large number of low-volume district general hospitals, which is currently the pattern in large parts of the country. For example, the Audit Commission has identified 25 operations or admissions and estimated that 75% of surgeries should be carried out as day cases. It estimates that if all trusts achieved an average 75% day case rate across these procedures, at least 390,000 bed days could be freed up. That would save £78 million, based on £200 per elective patient bed day.

Lord Darzi further explains that minimally invasive techniques will continue to improve. In the next 10 years, endoluminal surgery—entering the body through its natural holes, such as the throat—will become the standard method for treating many complex cases. Better diagnostics will also help most surgery to become non-invasive. Minimally invasive surgery means smaller scars and less risk of post-operative infection, which means patients will also recover more rapidly.

Furthermore, there is an argument for reducing the number of administrative staff required, which will be more cost-effective and save money that could be better spent on the quality of care. Hence, reconfiguration can deliver improvements in quality and safety without significant additional cost.

There are strong political and policy pressures to sustain, and where possible increase, local access to services, particularly those needed in an emergency such as A and E and maternity care. We have an ageing population, and the majority of hospital users will rely on public transport to take them to hospital. Transport systems will have to be put in place so that people can access the central hub hospitals.

How do we achieve the utopia I am seeking in the location and structure of national health service hospitals? I fear that we will need something that we do not currently have: some central direction. This project will take many years to achieve, and we need a cross-party committee to draw up a plan that applies to the whole of England and Wales, so that we can decide where the hospitals, including the community hospitals, are required. If we do that, I am convinced that we will be in a position to deliver the best care in the western world to all our constituents.