§ Mr. Malcolm Bruce (Gordon)I am glad to have the opportunity of raising this extremely important matter so soon after the Government announced—as far as I can gather, for the first time anywhere in the United Kingdom—that an entire hospital, including the provision of core clinical services, is to be put out to private bid to all corners. Before I deal with that point, I should like to address some of the background of how it came about.
In recent years, there has been a fundamental rationalisation of hospital services in Grampian. For those of us who represent rural constituencies, too often that has meant a closure of rural services and centralisation in Aberdeen. For example, the maternity unit in Inverurie in my constituency was closed and demolished. At that time there was a promise that a new GP or geriatric unit would be built on the site, but priorities changed and it has never materialised. In fact, the site is now a car park. Other maternity units were also closed at that time, although strenuous local campaigning ensured that we saved Keith, Huntly and Torphins.
Over the past year, hospitals for the mentally ill at House of Daviot and Kingseat in my constituency have closed. Most of the patients have been transferred to Aberdeen, some into the community, and 12 to a unit in the Jubilee hospital in Huntly. We are still awaiting a decision on the future of Woodlands hospital for the mentally ill, after a controversial and badly mishandled public consultation. In fact, along with the hon. Members for Aberdeen, North (Mr. Hughes) and for Aberdeen, South (Mr. Robertson), I met the Minister of State. We called on him to reconsider plans to close Woodlands and transfer to a new site to be built on the Cornhill site, and to come forward instead with plans to redevelop the site to meet the needs of the long-term mentally ill requiring permanent care or rehabilitation.
There is concern that we have heard nothing further about the proposal. If there is anything that the Minister can do to update us, or at least if he can say when an announcement will be made, I should be grateful.
More recently, there has been a welcome if limited recognition by health care providers in the north-east that there is strong demand for local community hospitals. Inverurie is lucky to have one. A review of the range of services that could be added to the hospital is still under consideration. Huntly has had a welcome investment in upgrading the Jubilee hospital. There is a growing campaign, backed by local doctors, for a community hospital to be provided in Ellon, where the former hospital was closed years ago and made into the golf clubhouse. Since that time, the community of Ellon has trebled if not quadrupled.
The health board has said that it recognises the demand. It has written to me, following consultations with GPs, stating the sort of provision that is being considered for Ellon. It suggests that it would include in-patient care, post-acute rehabilitation, respite care, rehabilitation, palliative and terminal care, day care, obstetric care limited to the post-natal phase, specialist out-patient clinics and home care support. The board went on to say that a Grampian-wide services review identified the potential for such a facility in Ellon.
714 However, it had other commitments first, including the replacing of the Woodlands hospital and potentially on a reprovision in Stonehaven. It is of concern to me that the announcement a couple of weeks ago about Stonehaven could further delay provision there and, consequently, have a knock-on effect on making progress towards commitment to a community hospital in Ellon. I am concerned about what was done, the way it was done and the knock-on effects elsewhere.
This time last year, Stonehaven saw the announcement by Grampian Healthcare trust in its business plan—that is no way to make announcements about the future of hospitals—that Arduthie and Woodcot in Stonehaven were to be closed. That announcement was sweetened with a pledge to build a new community hospital. I understand that, in accordance with that, towards the end of last year, Grampian Healthcare submitted plans—I have copies—for a new 47-bed hospital to be built on the site of Arduthie hospital at a cost of £2.4 million, which was based on the Scottish health executive's own standard costings.
That hospital would have replaced 77 beds that are currently provided by the two hospitals, which have a total full-time equivalent of 130 staff. The proposed new hospital is to include casualty services, 16 long-stay geriatric beds, 12 psycho-geriatric beds, 17 GP beds and two post-natal beds, and it would be similar to the community hospital in Peterhead, in the constituency of the hon. Member for Banff and Buchan (Mr. Salmond).
Grampian Healthcare must have been wondering at the delay in responding to its proposal, and indeed asking why it had not heard. It was as stunned as anyone when a press release was issued by the Scottish Office last month, stating that the new community hospital, including its core clinical services, was to be put out to tender to all corners. That is a first for anywhere in the United Kingdom. I am advised by Grampian Healthcare that to date it has received no direct formal notification of that, just a copy of the press release sent through the post.
That is in spite of the fact that, in a letter to me last year about Ellon hospital, the chief executive of Grampian health board said that it was already working with Grampian Healthcare on replacing Woodlands hospital and potentially on a reprovision in Stonehaven. Well, not any more; it is not. Not only has Grampian Healthcare had only a copy of the press release but, when it attempted to obtain more information from the health board, it was told that it was not entitled to it; it is no different from any other potential bidder for the hospital.
There will now be a further delay while the specification for the new hospital is drawn up. I understand that that will take four to five months. Presumably, that specification will then be made available to all potential bidders—private and public sector. That takes the private finance initiative way beyond anything that has been tried so far in the health service, and indeed beyond what the Government's own guidelines specifically suggested would happen. New guidelines published in March stated in a key paragraph:
An option that many projects will need to explore is one in which the private sector would undertake the design, building, financing and operation of the non-clinical services.That was a new departure in March, and in April we had the entire hospital clinical services—nursing services, doctors and all the paramedics—being put out to tender: design, build and operate.715 As far as I can ascertain, the closest that anywhere has come to that situation is Morriston hospital in Swansea, where a cardiac centre attracted bids from three private health care companies, but the bid was finally awarded to the local trust. I am advised also that that was under active consideration in Portsmouth, until the chief executive of the trust committed suicide. In both cases—it is an important distinction—the initiative to involve the private sector came from the trust. All right, it was under encouragement from officials and Ministers, but it was not imposed, as is the case with the proposed community hospital for Stonehaven.
Most people who live and work in the north-east of Scotland and those who represent communities in the north-east of Scotland take pride in our communities as being forward looking, progressive and flexible, but we see no reason why we should be the guinea pigs for experiments that Ministers would not dare to try anywhere else, and certainly not south of the border.
Ministers and others contend that the hospital will still be in the NHS because the services will be provided free to patients. That is a spurious argument as ownership, control and operation will be in private hands. It is comparable to a local council putting homeless people into bed-and-breakfast hotels and saying that those hotels are in the public sector. It is absolute nonsense; they are privately owned businesses selling their services on commercial terms to the public sector. That is not just my opinion. I quote Mr. Jeremy Taylor, chief executive of Grampian Healthcare trust:
If the services go to a private company it will not be NHS services, it will be a private service.In those circumstances, it is difficult to see how quality can be assured, complaints effectively pursued or costs saved other than by cutting corners, staffing levels, pay or probably all three. Private sector finance may be appropriate for the property. That is a matter of debate and it has been recognised that it may be a practical compromise involving the private sector, but it is not appropriate for core clinical services. The Government deny that there was any intention to put core clinical services in private hands and their own guidelines specifically limited the private funding initiative to non-clinical services.Not surprisingly, the announcement has outraged the local community. I am advised that last night Stonehaven community council passed the following resolution:
The decision of the community council is that we strongly oppose the measure that the Government is to take over the NHS in Stonehaven and we shall do everything in our power to oppose it.A number of relevant local interest groups were at that meeting. Local Liberal Democrats collected more than 2,000 signatures in the town on Saturday alone, to a petition calling for the retention of Stonehaven hospital services within the NHS.If an entirely new hospital is to be owned and run by a private company, it will not be an NHS hospital in any terms that the public understand. Likely bidders could include construction companies, organisations such as BUPA, breweries, property companies and almost anybody from public companies to private individuals—possibly, last week's lottery winner.
716 It is preposterous for the Government to suggest that they are not transferring fundamental national health service assets to the private sector. That is borne out by the fact that potential bidders will have to get their own legal advice as to their likely liabilities under the transfer of undertakings directive. As the House knows, that has already caused the Government considerable embarrassment and it may deter some people from making a bid. If potential bidders depend on lower staffing levels, they may subsequently have to pay for all the contractual obligations for workers whose contracts they amend or terminate.
All that preparation spells nice work for lawyers. The more bidders there are, the more counsel's opinions will have to be sought and the more consultants will be involved in the preparation of bids. That is characteristic of the Government. Far from cutting down bureaucracy, they have increased it. They have also increased the complexity of supervising the service and securing public accountability. They have created an enormous expansion in publicly funded consultancies and they have expanded the bureaucracy necessary to supervise a much more complicated way of delivering services.
There is no difference of opinion about the practicalities of what we want. We want new and improved community hospitals in Grampian. I certainly want improvements in Inverurie and a new hospital in Ellon. The population is growing faster than anywhere else in the country. I can provide figures that show that the population of Grampian is estimated to grow from 506,100 in 1990 to 517,409 in 2001. The population over 75 is estimated to increase from 32,063 to 36,063. There are comparable figures for Kincardine and Deeside and for Gordon. It is a general characteristic. We need the services; our populations demand them and they are not being delivered fast enough.
The Government's change in ideology and their desire to drive an experiment through in north-east Scotland mean that a hospital that could have been started this year will be delayed for another year—just to test the Government's ideology.
The decision was announced without public consultation, without consulting Grampian health board or Grampian Healthcare and certainly without consulting local doctors, who would be the main users of the hospital. It is a matter of treating public opinion with total, absolute and utter contempt and showing no interest in getting an input from the people who will ultimately manage, deliver, control and secure the service for patients, and indeed, value for money for the taxpayer.
I know, having spoken to them recently, that local doctors in Ellon are anxious to know how long they will have to wait for outline plans to become a firm promise. They are not keen on Stonehaven becoming the next guinea pig.
As I have said, there is room for private finance in aspects of the health service if there are genuine benefits, but the proposals are a step too far. They take the NHS out of Government hands and further from effective public accountability. I assure the Minister that it will be a long, bitterly fought battle.
§ The Parliamentary Under-Secretary of State for Scotland (Lord James Douglas-Hamilton)First, I would like to answer the question that the hon. Member 717 for Gordon (Mr. Bruce) asked about Woodlands. My noble and learned Friend the Minister of State recently met relatives of the people cared for at Woodlands and local Members of Parliament to hear their views at first hand. Before reaching a decision on the proposals, the Secretary of State will wish to be satisfied that the alternative model of care proposed is geared to meeting patients' individual needs, whether care is provided in the community or in a hospital setting. That matter remains under consideration.
We have heard a certain amount today about perceived threats to the NHS, about privatisation—by either the back door or the front door—and about the concept of free health care being undermined by the possible involvement of the independent sector in the provision of services.
The proposals for Stonehaven are certainly not about privatisation. They are about seeking to achieve a high-quality, responsive service, tailored to the needs of the local community. Let me be quite clear that the health board, as purchaser of health care services in Grampian, is leading the exercise and will continue to do so. The board will set and monitor standards and pay for the service, as it does at present.
Let me say what I believe the NHS is about. It is primarily about patient care and putting the interests of patients before all other considerations.
§ Mr. Robert Hughes (Aberdeen, North)Will the Minister give way?
§ Lord James Douglas-HamiltonNo. I must answer the points raised by the hon. Member for Gordon first.
The NHS is about providing that care free at the point of delivery to those who need it, and ensuring that the best possible quality of care and treatment is delivered in the best possible facilities in the most efficient and cost-effective way.
Despite the alarmist and somewhat misleading press reports about Grampian health board's announcement that it intends to put hospital services in Stonehaven out to open tender, nothing in the board's proposals is inconsistent with the principles that I mentioned.
It may be helpful if I put the record straight by outlining the background to what is now proposed in Stonehaven, which is in the constituency of my hon. Friend the Under-Secretary of State, the hon. Member for Kincardine and Deeside (Mr. Kynoch). He has taken an assiduous interest in the matter ever since he was elected. He has repeatedly been to see my noble and learned Friend the Minister of State and regularly written to him urging a resolution.
There are at present two hospitals in Stonehaven—Arduthie and Woodcot—providing GP-managed acute beds, long-stay services for the elderly, casualty and other therapeutic support services. Both hospitals are old and no longer provide an ideal base for modern hospital care. Neither is suitable for development to meet future service needs.
Grampian Healthcare NHS trust, which currently provides the services from those hospitals, recognised the need for change and highlighted its intention to modernise services in its business plan published early in 1994.
The trust also carried out an option appraisal in 1994 with the close co-operation of Grampian health board, which is responsible for assessing need, planning services 718 and purchasing them on behalf of the board's resident population. Representatives of the local community were also involved in the process.
The appraisal examined a number of options, ranging from the status quo through modification of one or both the existing hospitals to provision of a new hospital. The conclusion was that a new hospital, to be built on the existing Arduthie site and designed to replace both existing hospitals, was the best way forward.
Having reached that conclusion, the trust submitted its appraisal and recommendations to the Scottish Office. There are two main reasons for the Scottish Office being involved. First, new hospitals have to be paid for and any proposals that might involve investment of NHS resources must be considered in the context of competing bids for capital development funded elsewhere in Scotland. Secondly, any proposals to close existing hospitals must be consulted on publicly by the health board and ultimately approved by the Secretary of State.
On the first point, my right hon. and learned Friend the Chancellor of the Exchequer made it clear in his November 1994 statement that no public sector capital projects would be approved unless the scope for involving the private sector had been fully explored. In discussing the recommendations made in the trust's option appraisal, the Scottish Office and Grampian health board agreed that that should be done in seeking to secure a new hospital for Stonehaven.
The object of the exercise would be, without being prescriptive in any way, to invite potential providers to say how they would provide the new hospital and to establish whether there were previously unconsidered and perhaps innovative ways of doing so. It would also help to establish clearly the solution that best met the health care needs of the people of Stonehaven, while offering the best value for money.
With the agreement of my noble and learned Friend the Minister of State, the health board has been asked to draw up a detailed specification of the services that it wants to purchase in Stonehaven, and thereafter to invite tenders from a range of organisations for providing the new hospital. It will be open to the Grampian Healthcare trust, other NHS trusts and the independent sector to bid for the contract separately, or in conjunction with each other or general practitioners. It will also be open to those organisations to bid for all or part of the service.
On 26 April, Grampian health board announced that it had been asked to proceed in that way, indicating that it would start work immediately on preparing the specifications—which, on its present timetable, it expects to complete by the autumn. Thereafter, the tendering process would begin. The board's aim is to be in a position to make a decision on the bids by the end of April 1996.
The board publicly stated that it would work closely with local GPs and with the local community and its representatives to establish the nature of services required at the new hospital before preparing the service specification. Mechanisms will be put in place to enable members of the public to comment individually if they wish. There can be no doubt that the views of health care professionals and of users of the service will be fully taken into account.
719 That is where things stand. No decisions on who will provide the new hospital in Stonehaven in the future have yet been taken, and it seems wrong to me to speculate on the likely implications for health care services in Stonehaven before that point has been reached.
It might be helpful if I outline what those proposals mean and do not mean. They mean that a new hospital will be provided in Stonehaven—my noble and learned Friend has already made that clear. They offer the opportunity of providing a new hospital earlier than might be possible under a conventional NHS solution, if the private sector shows interest in building it. They will ensure that all possible options for providing a modern service geared to the people of Stonehaven's needs are fully explored. They will provide the opportunity for the local community to be involved in determining their own needs, through the board's intention to consult on the preparation of its specification and the consultation that will be required before either of the existing hospitals can close.
The proposals do not mean that people will be asked to pay for services. We remain committed to providing health care free at the point of delivery. The proposals do not represent a fundamental change of policy compared with existing arrangements. General practitioners currently provide the services at the existing hospitals and will continue to do so at the new hospital. Private sector involvement in the provision of long-stay services for the elderly and other care groups is already well established.
The proposals do not mean a reduction in the quality of service. The objective is to identify the best way of providing those services. The health board will remain responsible for specifying the service requirements. We expect the board to be rigorous in monitoring quality and standards through its contract with whatever provider is successful in the tendering process.
The proposals do not mean a wholesale move away from provision of health care services by the NHS. We are committed to ensuring that people have access to high-quality, cost-effective services funded through the NHS wherever they happen to live. Each proposed new service development will continue to be considered in the context of best meeting the needs of the people to be served.
The proposals do not automatically mean that services in Stonehaven will be provided by the private sector. Once all the options have been appraised, a conventional NHS solution may yet turn out to be best. Grampian Healthcare has welcomed the proposed approach and is clearly in a strong position to submit a competitive bid. The proposals do not cast any doubts on the quality of the service currently provided by Grampian Healthcare staff. Their skills and dedication are not in question, and they will also be a powerful weapon in the trust's armoury in preparing any bid.
Inviting bids from a wide range of potential providers and minimising the restrictions on what they are asked to say they can provide, or the manner in which they can provide it, will ensure that providers have the scope to develop innovative solutions to delivering the best possible services in terms of quality and value for money.
§ Mr. Malcolm BruceWe have heard a great deal of civil service speak. Will not the Minister acknowledge that the proposals for Stonehaven are a step further than anything proposed anywhere else in the United Kingdom?
720 Despite the Minister's remarks, it is not a question of inviting providers to ensure that they secure the maximum public participation. It is a question of putting the entire hospital out to bids from all corners. In those circumstances, when the hospital could be owned entirely by a brewery or anybody else, it is difficult to see how the palliatives that the Minister mentioned can be secured. If that is the way that the NHS is going, can he really believe and maintain that the service is safe in his hands?
§ Lord James Douglas-HamiltonYes. What matters is that the best possible services are provided to consumers in the best possible manner. That will certainly happen. Of course the health board has the right to monitor closely and to enforce the terms of the specification. If they were broken by anybody, the board would be in a position to take the necessary remedial steps immediately. I would expect it to do so. It is the board's duty to make certain that the highest possible standards are maintained, which is in the best interests of consumers.
The hon. Gentleman called for this debate under the general heading of new hospital provision in Grampian. The city of Aberdeen already enjoys the benefits afforded by a hospital in a central location at Foresterhill, which provides for the majority of acute service needs.
§ Mr. Alex Salmond (Banff and Buchan)Will the Minister give way?
§ Lord James Douglas-HamiltonNo. I must explain the general position.
The existence of Foresterhill has not prevented our approving capital expenditure of £9 million in recent years further to service provision at Aberdeen royal infirmary and a further £21 million to facilitate rationalisation of acute and other services in the city and beyond. Only two weeks ago, my noble and learned Friend opened the new infection unit at the infirmary—the first of its kind in Scotland and the first to be incorporated within an acute teaching hospital. In the mental health sector, investment of £29 million has made the Royal Cornhill one of the most modern hospitals of its kind in the United Kingdom.
Outwith Aberdeen, a major redevelopment and expansion of Dr. Gray's hospital in Elgin, costing some £22 million, will ensure that the people of Moray have ready access to a wide range of hospital services, many of which they would previously have had to travel to Aberdeen or Inverness to obtain. Peterhead cottage hospital has also been completely rebuilt at a cost of £4.4 million and is now a fine example of a modern community hospital providing a range of services in a local setting.
§ Mr. SalmondWill the Minister give way now?
§ Lord James Douglas-HamiltonIf the hon. Gentleman has a question about Peterhead, I shall answer.
§ Mr. SalmondI actually want to ask a question on the subject of the debate. The Minister mentioned the role of the Under-Secretary, the hon. Member for Kincardine and Deeside (Mr. Kynoch). Was that hon. Gentleman consulted in any way before the initiative was launched—or was he kept in the dark, like the rest of us? That is a simple question, so may we have a straight answer?
§ Lord James Douglas-HamiltonIf the hon. Gentleman is seeking to get me to reveal private and confidential discussions between my hon. Friend and 721 other members of the Government, the answer is that they remain confidential. My hon. Friend the Member for Kincardine and Deeside has been foremost in putting the interests of his constituents first on every conceivable occasion.
Capital expenditure of more than £100 million has been approved for hospital building or improvement in Grampian since 1979. I do not see that as an indictment of the Government's record. On the contrary, I see it as a clear indication of our commitment to ensuring that the people of Grampian enjoy modern, efficient hospital care.
I am confident that the NHS is alive and well in Grampian. We are committed to it remaining so. Our first priority, which the current proposals for Stonehaven are intended to support, is to ensure that NHS users in Grampian and elsewhere in Scotland enjoy the kind of responsive, high-quality services that they are entitled to expect.
Grampian has made rapid and effective progress in developing care in the community and in ensuring that people are only—
§ Mr. Deputy Speaker (Mr. Geoffrey Lofthouse)Order. Time is up.