HC Deb 18 July 1984 vol 64 cc299-301
5. Mr. Ewing

asked the Secretary of State for Scotland if he will make a statement on his circular to health boards instructing them to put out to private tender their catering, cleaning and laundry services.

8. Mr. Willie W. Hamilton

asked the Secretary of State for Scotland if he will make a statement on his recent circular to health boards concerning the privatisation of the catering, cleaning, and laundry services of National Health Service hospitals.

12. Dr. M. S. Miller

asked the Secretary of State for Scotland what provision he has made for increases in administrative staff in Scottish hospitals consequent upon privatisation proposals.

The Parliamentary Under-Secretary of State for Scotland (Mr. John MacKay)

The circular of 22 June confirms our policy of testing the cost-effectiveness of support services to enable health boards to secure savings which will be available for patient care. The circular sets out short and long-term timetables for action by health boards and the Common Services Agency. It is part of their continuing duty to identify and secure efficiency savings, and I see no need for additional staff.

Mr. Ewing

In view of the Minister's failure yesterday to clear up the status of the document that he has sent to the health authorities in Scotland, will he clarify the status of that document and make clear what action he would take if any of the health boards — rightly, in the view of Labour Members — sensibly ignored the Minister's document?

Mr. MacKay

The document that I have sent to the health boards has the same status as the many circulars and documents which the hon. Member sent to health boards in his time in office. The document suggests a course of action that health boards should take. I fully expect them to take that action, as they are appointed by my right hon. Friend. — [Interruption.] That is a fact. They are appointed by my right hon. Friend and are answerable to him and to Parliament.

Mr. Hamilton

Will the Minister give a categorical assurance that he will give in writing to all the health boards an undertaking that if they wish to retain in-house services they will not be compelled by him to accept private contractors? Will he also declare in writing that private contractors must observe all National Health Service conditions of service and all its statutory responsibilities?

Mr. MacKay

I have made it clear on a number of occasions that health boards will be expected to judge private tenders on the basis of competence and efficiency. Private contractors must be able to do the jobs that the health boards expect them to do. I expect the health boards to take the lowest tenders, all other considerations being equal.

Dr. Miller

Surely extra administrative staff will be needed for sending out tenders and assessing their value. May we have an assurance that if and when tenders prove to be more expensive than the cost of work done at present the Minister will come to the House to explain the exact position?

Mr. MacKay

The position in relation to my short-term request to the health boards will be clear at the year's end. I shall then be happy to answer questions about the tenders. The administrative staff of the Health Service should already be monitoring in-house services. It will not add much to the work load to ask staff to prepare tenders for work which is already supervised and known well.

Mr. Malone

Will my hon. Friend dispel the rumour put about by Opposition Members that there will be redundancies in the nationalised sector? If that sector can provide the same service as the private sector at competitive prices, will it not have an equal opportunity to tender?

Mr. MacKay

My hon. Friend is right. I have said time and again that if the in-house cost is lower than that of outside contractors, the health boards will sensibly accept the in-house tender. I expect that in some cases that will happen. Whether in-house tenderers or outside contractors are the winners, money will be saved to be used for direct patient care.

Sir Hector Monro

Can my hon. Friend confirm that if tenders are comparable and on exactly the same terms, he will leave it to the health boards to decide which to accept, bearing in mind value for money and cash saved for the health care of patients?

Mr. MacKay

I confirm that I shall expect health boards to work out the pros and cons of tenders and attempt to balance the advantage to the health board in the money that can be saved. That will be at their discretion. I know that the health boards wilt act sensibly and not be politically motivated, because they wish to use the money for patient care if any savings are to be made.

Mr. Kirkwood

Does the Minister accept that by requiring the health boards to undertake a tendering process the Government are delivering a kick in the teeth to the many loyal and dedicated staff in the catering and ancillary services? What advice has he for the management boards which will have to cope with irreparable damage to industrial relations?

Mr. MacKay

Perhaps the alliance has some relationship with the trade unions in the Health Service. The Government's motive is to achieve the best value for money for the taxpayer and the patient. We shall achieve that through contracting out, if the tenders are available. I do not think that loyalty has anything to do with the matter. If the in-house tender is the most economic, the health boards are free to accept it.

Mr. Maxton

Has the Minister read the response of the Greater Glasgow health board to the earlier circular on privatisation? Is he aware that that response was agreed unanimously by a board made up of either medical experts or appointees of the Secretary of State and that it includes Lady Goold, the wife of the chairman of the Scottish Conservative party?

Mr. MacKay

Yes, I read the original remarks by Greater Glasgow health board; but, after discussion with the chairmen of the health boards, including the chairman of the Greater Glasgow health board, I sent them a new circular, and there was no suggestion in my meeting with them that they would not go along the road that I was requesting.

Mr. Canavan

When will something be done about the activities of certain Tory Members, such as my own Member of Parliament, who is moonlighting as the head of Michael Forsyth Associates and seems to be using his parliamentary position to further the interests of his own company, which is up to its neck in this aspect of the privatisation of the Health Service, which, anywhere it has been tried, has been shown to mean dirty linen, dirty sheets—

Mr. Speaker

Order. I hope that the hon. Gentleman is not seeking to impugn the honour of the hon. Member for Stirling (Mr. Forsyth).

Mr. MacKay

It is clear that the hon. Member for Falkirk, West (Mr. Canavan) will not withdraw his remarks about my hon. Friend, which are totally unjustified. Hon. Members have their interests declared in the Register of Members' Interests. It is up to them to defend their position, which they can do perfectly well. I have no doubt that the hon. Member for Falkirk, West has his trade union interests to defend.

Mr. Michael Forsyth

Does my hon. Friend not find it astonishing that the official Opposition seem to confine themselves to personal attacks on hon. Members on a matter which has already saved the Health Service many millions of pounds, mainly where in-house direct labour organisations have cut their costs and no outside contractors have been involved?

Mr. MacKay

My hon. Friend is perfectly correct. It is amazing that the Opposition do not seem interested in getting value for money in the cash spending of the Health Service. As I told the Scottish Grand Committee yesterday, already by in-house tendering being looked at seriously and critically, Tayside health board has saved £250,000 in the cleaning costs at Ninewells alone.

Mr. O'Neill

Will the Minister confirm clearly and simply that, in the event of any health board refusing to comply with his suggestions of 22 June, it is liable to be sacked? Will he answer that yes or no?

Mr. MacKay

As I said at the outset, the circulars have the same strength as they have had in the past.

Mr. O'Neill

Yes or no?

Mr. MacKay

These are my requests to the health boards. I have had no indication that any board will refuse to go along that road. Until that day comes, I refuse to speculate.