National Health Service (Fundholding)

HC Deb 03 November 1995 vol 265 cc499-570

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Conway.]

9.34 am

The Minister for Health (Mr. Gerald Malone)

I am pleased to have this opportunity to debate such an important topic. The House will find it interesting to have an opportunity to explore how far statements made by former Opposition spokesmen on fundholding now reflect the views of the current team or, indeed, the views of the people they represent. General practitioner fundholding is one of those issues that appear to divide Opposition Members. It certainly has in the past and it will be interesting to discover whether it will today. Perhaps we shall be given a clearer view of their proposals for the future of primary care and, perhaps, some final acknowledgement of the important role that fundholders have already played in reshaping local health services to benefit patients. I will return to that subject later.

First, I want to make clear what the Government are doing in the primary care sector and fundholding in particular. It is widely recognised that the NHS is in a constant state of change and development. That is not surprising and there are a number of reasons for that. Medical technology, public expectations and other pressures all require the NHS constantly to change and adapt. The same is true of all other health care systems. We need only to look around the world to realise that many countries are not coping with the pressures, whereas in this country the NHS, as it is shaped by Government policies, is coping. The conclusions that I draw from those international trends is that the United Kingdom is out in front, while other countries are following our lead.

The Government's overriding aim in that process of change is to ensure that the quality of NHS care we have tomorrow is better than we have today. I want to set out the four key aims for the NHS. First, we want to make services high quality and effective, focusing on the care of individuals as well as improving the health of the population, as set out in "The Health of the Nation". I hope that the House will recognise, as I am sure the public recognise, that "The Health of the Nation" strategy is an extremely important development, leading the NHS away from simply coping with problems to positively developing the health of the nation and moving more towards prevention than we have ever previously been able to do.

Secondly, we aim to give patients the right services in the right way. It is not just about improving the quality and range of clinical services and developing the patients charter, but about ensuring that services are accessible to people. The NHS must be at the heart of every local community. Patients must be confident that the organisation of services reflects what they want and need, rather than what others think they should have.

At the core of the reforms is the point about putting patients' care first. The changes that have occurred and the move from the acute to the primary sector ensure that treatment is taking place in an appropriate setting, as near to the patient as possible. Under the old NHS patients were pushed around the system; under the NHS as we envisage it today, patients will find services much closer to where they live.

Thirdly, we want services to fit together in a seamless way, with no gaps or overlaps and with strong links between all parts of the NHS. Many people with varying degrees of expertise work within the service. Now, the consultant cannot work in splendid isolation from the community midwife; nor can the GP from the social worker. Only through partnership among professionals can we the secure highest quality of care for patients. What underpins that aim is the principle that when the patient is being treated, he should not notice when he is moving from one element of care to another. Care for the patient should be seamless.

Lastly—and I make no bones about this point—we must give patients as much as we can from the money available. I am always astonished by the Labour party constantly saying in debates that getting value for money and putting the mechanisms in place to achieve that are almost unimportant. The taxpayer is now putting record levels of money into the health service, yet the Opposition think that unimportant.

The truth of the matter is that that money is not only for the men in grey suits—the accountants and financial directors or, indeed, the Treasury—but embraces those in white coats who are now far more involved in managing the NHS than ever before. Benefits can also be obtained through improvements in clinical effectiveness and audit. That is part of the process that has been under way since 1990 to ensure that the NHS is accountable in detail to Parliament and the public. In essence, it means ensuring that decisions are made at the right level by those in the right place who have the right information.

I wonder whether Opposition Members would disagree with any of that. I would be surprised if they could. They say that they share our objectives, but, when the mechanisms are put in place and we debate them, they say that the mechanisms are wrong. If they sign up to those objectives, it is all the more amazing that they can continue their opposition to fundholding. I cannot think of a better example than fundholding that meets all the four aims necessary to improve the NHS.

I now cite examples of the ways in which fundholders deliver the key principles. First, they make services responsive to the needs of patients and they make them more accessible. There are examples of that happening all over the country, as I see when I visit GP practices, fundholding and non-fundholding. For example, in Buckinghamshire, the patients of Dr. Maisey and his partners no longer have to attend the local district general hospital for radiology or out-patient services.

Patients at a practice in Ealing now have access to a range of complementary medicine at the practice, which is increasingly what patients want. Under fundholding, if patients think it desirable and doctors think it a clinically appropriate way to deliver treatment, that is what happens. Before fundholding was introduced, those patients had to go into hospital for orthopaedic, rheumatic or physiotherapy treatment. Patients agree that life is much better when fundholders can use their discretion and ensure that care is delivered closer to the patients.

One of the arguments constantly used by the Opposition is that in fundholding we have created a two-tier health service. Yes, we do have a two-tier NHS—the NHS that we had in 1989 and the NHS that we have now in 1995. Let me give the House an illustration of the difference. Under the old NHS, the number of people waiting more than 12 months was 223,311. This year, the figure is 32,194. The average waiting time under the old NHS for in-patient or day case admission was 9.3 months, whereas the average time now is four months. Under the old NHS, there were 38,900 hospital doctors; there are now 44,600. There were 3,051 medical school places available; there are now 3,315.

The Opposition say that we have cut the national health service and that we, as a Government, have not been decent custodians of it, but the opposite is true. The service has become far more effective and is now a top-tier NHS. That is what the Opposition would dismantle.

Mr. David Hinchliffe (Wakefield)

I am interested in the Minister's comments about the two-tier system which he denies that fundholding has created. I should like an answer to the questions that I have been asking him and the Secretary of State for some time. If there is not a two-tier system, why are my constituents, who are waiting for treatment at Pinderfields hospital in Wakefield, being asked whether they belong to a fundholding practice or not? Why is it that patients from fundholding practices needing certain specialist treatment can get it while patients from non-fundholding practices cannot?

Mr. Malone

I am glad that the hon. Gentleman has given me the opportunity to deal with that point. As he well knows, when we set out to introduce fundholding, there was agreement with consultants and the medical profession as a whole as to how we would view priorities. Every emergency is treated as a priority and the treatment is similar. Where fundholding bites is in the purchasing of marginal care in hospitals where there is spare capacity for fundholding patients. Of course, when people present to have certain needs addressed, the question to which the hon. Gentleman referred will be asked because it has to be determined whether there is a contract with the fundholder for that particular service.

What amazes me about the Opposition's comments about there being a two-tier system is that they imply that everyone across the country was treated in the same way under the old NHS. I said that in 1989 there were 223,311 people waiting for treatment, but they did not all wait the same length of time. That time varied from region to region, and waiting lists still vary from region to region. It is absurd that the Opposition denigrate the fact that we have been making progress. They wish to denigrate the fact that using fundholding in a different way from a health authority to purchase margins of health care is providing better treatment for patients.

The Labour party is, as it has always been, the party of levelling down. It does not ask why health authorities are not purchasing their health care in the same innovative way as fundholders so that patients benefit. The purpose of fundholding is to create a leading edge by which others will inform themselves of best practice. It also creates targets to which others may aspire.

Mr. Bernard Jenkin (Colchester, North)

Do not Labour's complaints about fundholding fail to make it clear that fundholding is advantageous to patients? Does my hon. Friend recall the time when there used to be a multi-tier health service across the country? The treatment that one received and how long one had to wait for it was a lottery, depending on where one lived. Does he remember that the two-tier system of 1979 meant that, if one could persuade the picket line to let one through, one was treated, but, if one could not cross the picket line, one went without treatment?

Mr. Malone

My hon. Friend is absolutely right. It is important for patients and the country as a whole that we demolish the two-tier argument. The Opposition use it to suggest that it is unusual that waiting times vary across the country, but that has always been the case.

Mr. Hinchliffe

At the same hospital?

Mr. Malone

When there were 223,000 people waiting for treatment, there were of course different waiting lists at the same hospital, but then people had to buy care to move up the waiting list. Now, the NHS treats people within an average of four months rather than nine months. That is the system that we have developed.

Mr. David Congdon (Croydon, North-East)

Does my hon. Friend agree that, as the evidence shows that GP fundholders get no more funding per patient on their list than equivalent non-fundholders, the reality is that fundholders use their purchasing power far better than the bureaucracies of the health authorities? Is not the challenge for health authorities to bring their use of purchasing power to the level of that of fundholders?

Mr. Malone

My hon. Friend is right. If that were the question asked by the Opposition, I might have some sympathy with them. I was coming to the point raised by my hon. Friend. Fundholding is about making services more coherent and providing stronger links between the primary and secondary care sectors and within the primary care team. It is these fundamental changes that have delivered the margins with which fundholders are able to buy additional care for their patients.

There is an example of that in Manchester which shows how fundholding can help a practice focus on how to be better organised, involving the whole primary health care team. Doctors there have greatly improved the practice for patients by reducing non-attendance and improving immunisation services. The practice will not stop there, and that is one of the characteristics of fundholding. The doctors and professionals concerned are keen to move the boundaries ever further forward and they are looking to develop a wide range of in-house services not previously available.

But that is only part of the story. Fundholding is not just about improving services. Our strategy under the "Health of the Nation" White Paper is central to the aim that I set out earlier of improving the health of the population as well as delivering first-class health care. GPs are ideally placed to make a major contribution to that. Their dual role of needs assessment and direct patient care puts them at the leading edge to achieve genuine health gain.

For example, there are new and novel solutions to meet problems being faced by the community. In County Durham, Dr. Derek Brown has developed a scheme called "Positive Parenting" to help parents of children under five move safely through concerns that they may have over their children's health, be they speech difficulties or sleeping.

In such ways, GPs are using the flexibilities of the fundholding scheme to seek improvements in the health of the population. Who better than fundholders can demonstrate how doctors, directly involved in managing resources, can secure not only better care for their patients but better value for money for that care?

Mr. Stephen Timms (Newham, North-East)

rose—

Mr. Malone

I will give way in a moment.

The point about managing resources is absolutely crucial. On fundholding, the Labour party has been slippery. It has moved towards the principle and said that the principle is all right. Now I understand its policy to be—it may change yet again today—that, sure, it thinks that it is fine to be a fundholder, but it will not let the medical profession get their hands on the funds. That is the most patronising, absurd attitude towards the medical profession that I can think of. The use of the funds, and the responsibility that that brings, has transformed much of primary care in our country.

Mr. Timms

In view of what the Minister is saying about fundholding, will he clarify whether it is the Government's intention that all general practitioners should become fundholders, and, if so, in what period does he envisage that taking place?

Mr. Malone

If GPs wished to become fundholders, I would very much welcome it. But it will not be compulsory. The Government's policy has not changed. [Laughter.] The Labour party's health spokesman, the hon. Member for Fife, Central (Mr. McLeish), may laugh, but when we introduced fundholding, I remember Labour Members' tales of how it would never happen in practice because doctors would not like it. Yet now more than 50 per cent. of the population of England and Wales are served by fundholders. Not only do the doctors like it, the patients like it as well.

I see the process rolling forward, not by compulsion, but in an entirely voluntary way. The Government are not forcing them. It is peer group pressure. When one doctor sees what is happening in a fundholder's surgery and the improvements that the fundholding practice is able to bring to bear on patient care, there is a "me too" principle—[Interruption.] There is a "me too" principle of being able to do better for the patients.

Mr. Michael Stephen (Shoreham)

Does my hon. Friend remember that, when we introduced fundholding, the Labour party predicted that doctors would be going bankrupt all over the country? Has that scare story been realised?.

Mr. Malone

No, it has not, but it is useful for my hon. Friend to remind us of what the Labour party was saying about fundholding. We shall contrast with some interest what it was saying, and what we recollect of it, with what—perhaps—it will say about it today.

I should like to look at some other examples. In Glossop, there is the development of a homeward bound unit for people with learning disabilities, which has provided an ideal link between leaving a long-stay institution and moving into the local community. Not only does it provide a better, more integrated service, but that unit saves the NHS more than £500,000 a year in in-patient costs.

I use that specific example of a saving which can now be spent on patient care to take head on the other argument against fundholding that the Labour party uses: that it absorbs far too much in management costs and that it is an inefficient use of funds. I find that a rather surprising argument. We are for ever seeing the rather lugubrious face of the shadow Chancellor of the Exchequer popping up on television saying that the problem with the Government is that they are not prepared to invest; that they look at short-termism and are not investing in services.

Well, proper management in fundholding is such an investment. Let us get the amount of it in context. The amount that has been invested in fundholding management is 0.1 per cent. of the total NHS budget. That investment is well worth while. The House should consider what just one fundholder can achieve. If one fundholder saves £500,000 for the NHS, which can be deployed in further patient care, just think of what is happening across the country.

Doctors who are directly involved in managing those resources at the grass roots are getting better value. Overall, sfundholders have achieved efficiency savings of more than 3.5 per cent. a year in return for increased management expenses. Not only have they achieved it once, but have done so every year since the scheme began to operate.

Ms Margaret Hodge (Barking)

rose—

Mr. Malone

I shall give way in a moment.

The savings have been achieved by releasing the innovation and ideas in primary care on better ways in which to deliver services.

Ms Hodge

Two questions arise. We are not talking about additional administrative costs as a proportion of the total NHS budget, but as a proportion of what was previously spent on GPs. By how much has that increased? Will the Minister reply to the point raised by the hon. Member for Croydon, North-East (Mr. Congdon)? Do not GP fundholders receive additional moneys ostensibly to cover those administrative costs? Are they not better off than GPs who are not fundholders?

Mr. Malone

The hon. Lady persists in refusing to recognise the point which I happily concede: of course fundholders get extra money for administration. I point to the fact that not only is that a good use of public money—an investment, as the shadow Chancellor of the Exchequer would no doubt tell us if he were making this speech. Such investment has produced greater efficiency in health care and has delivered a net benefit of about 2 per cent. Those funds can then be devoted to patient care and would otherwise have been lost.

So I make no apology for saying that good management in fundholding is right. Investment must be at the proper level. As long as it continues to drive more efficiency and better patient care, it is a proper deployment of public funds.

The illustration that I have given the House of how freedoms have worked is just a portion of what has been happening across the country. GPs are now able to manage NHS resources to improve the care for their patients—the freedoms and services that the Labour party wants to end; taking away from patients the improvements that they have seen and enjoyed. Only the Labour party would wish to make services worse for patients. Indeed, what it probably means is that it would be satisfied if the worst in the land was the criterion on which every service should be administered.

That is the implication of the Labour party's argument about two-tierism. If it thinks that those who are doing better are doing unfairly by their patients, the clear corollary must be that, to introduce fairness into the system, everybody must proceed at the pace of the worst. That is not an agenda that this House or the public would accept, and it is certainly not an agenda that the 50 per cent. of the population think is realistic for the way forward.

I should like to move to the important role of new health authorities in supporting primary care. It is a key feature—

Mr. Henry McLeish (Fife, Central)

rose—

Mr. Malone

I will give way in—

Mr. McLeish

It is on the previous point.

Mr. Malone

In that case, I shall give way.

Mr. McLeish

The Minister has talked ostensibly about the 50 per cent. of GPs and the population covered by fundholding. I expect that a fair chunk of his speech will be given over to the other innovations and activities of non-GP fundholding practices throughout the country.

Mr. Malone

I will certainly be dealing with joint commissioning in due course. May I say that I am delighted to see that the number of GP fundholders in the hon. Gentleman's constituency is rising. That is indeed good news for the people in Fife. There seems to be a remarkable connection, because when the right hon. Member for Derby, South (Mrs. Beckett) was Opposition spokesperson on health, fundholding in her constituency rose to 87 per cent. It is not yet quite at that level in the hon. Gentleman's constituency—it is about 30 per cent.—but we all hope for progress. Similarly, we look for great strides to be made in Peckham in increasing fundholding.

The role of health authorities will be extremely important as we bring together district health authorities and family health service authorities to make a coherent whole. We must continue to develop our service with the new health authorities so that they have the confidence to deliver the services patients need. Fundholders do not lack confidence. We have seen their confidence to try out new ideas, to extend influence and to seize opportunities. That work must be supported by the new health authorities, which will be able to look at the needs of the population locally and more directly.

Not everybody is at the leading edge or sees the world in that way. With the new health authorities in place, we need to translate the enthusiasm of some into the willing commitment of all; that will be the most important task of the new authorities. For the first time in England, we shall have single authorities looking strategically at the whole range of primary, secondary and community services in their areas. They will be able to assist in the process of meeting the four aims: making services high quality and effective; giving patients the right services in the right way; ensuring services fit together; and getting as much as we can from the money available.

We have now set an agenda related to primary care for the authorities to follow; those on the ground now need to see, feel and believe in the benefits. I expect the new health authorities to work with all GPs and primary health care teams and to involve them in the process of delivering a primary care-led service. GP fundholders are at the forefront of the changes and health authorities must tap into their enthusiasm, their innovative ideas and their ability to get improvements in the care provided to all patients.

I am slightly surprised that the hon. Member for Fife, Central and the rest of the Labour party seem to think that joint commissioning is a great innovation; it became possible only under our health service reforms. It has happened to some extent on a voluntary basis, in different ways, and I welcome that. But joint commissioning is not a policy that has been rolled out in a comprehensive way, as fundholding has been. It is not a policy under which one can measure the benefits across the country as one can do with fundholding. Of course, I welcome the fact that the new health authorities will have a duty to consult all GPs about the commissioning of services.

The joint commissioning policy misses the fact that, under fundholding, it is the individual doctor who decides what is best for patient care. Commissioning is, perhaps, a bit of a revamp of the old system under which committees decided these things. Representatives of doctors were involved and the Labour party would probably like councillors to be involved as well. That is the way in which Labour wants to take the policy forward. They will not concede the important principle that what has driven forward the reforms and has made everyone try to catch up with the fundholders is the idea that the funds follow the patient and are secure in the hands of the GP fundholder.

I recognise that not all GPs will be fundholders; not everyone wishes to be one. However, a clear majority now do and they must be supported. Fundholding should be developed comprehensively so that we can take it forward even beyond the existing successes.

I find it extraordinary that the Opposition are pushing the supposed merits of GP commissioning over fundholding. We have always had some locality purchasing in GP commissioning, but the fundholding model devolves purchasing power from health authorities to GPs to provide greater sensitivity to patients at a grass-roots, practice-by-practice level and ensures that decisions best reflect the needs of individual patients and the local community.

The information that we get from those who participate in joint commissioning exercises is welcome and many of them have innovative ideas. However, joint commissioning is not evenly spread across the country. Giving power to the individual doctor is at the core of our policy and it clearly works. I believe that the Opposition finally recognise that fact.

Only a few weeks ago, the right hon. Member for Derby, South finally acknowledged the beneficial developments made by fundholders. She said at a conference: We want genuinely to pay tribute to the role that you as fundholders have played in kick starting and developing innovative practice in both primary care and the acute sector. None of it has gone unnoticed and all of it is valued and is worthwhile. Although those words may have been used to placate the fundholding conference she was addressing, the second half of the policy was missing: "We value you, but we are going to take your power of choice away by depriving you of your budgets." If the right hon. Lady had been entirely honest, she would have given that message. She went further and said that Labour proposed to keep the flexibilities introduced by this Government. Is this a signal of yet another change in Labour's position? We shall wait and see what the hon. Member for Fife, Central has to say.

We were told at first that Labour would end the fundholding scheme within the first 100 days of a Labour Administration. Then we were told—the hon. Member for Newcastle upon Tyne, East (Mr. Brown) developed this policy in a sub-fugue: It is our intention to phase out fundholding over a period which may be as long as three years. As fundholding rolled out and became more popular, the Labour party began, inevitably, to roll back from the argument and we heard that it was "individual practice fundholding" which would be phased out. I am not sure what that means, but I suppose that it sounds more comfortable than closing fundholding practices.

What further changes can we now expect? The truth is that the Labour party has now waved the white flag in terms of the rest of the improvements that the Government have brought to the health service. I suggest to the hon. Member for Fife, Central that Labour should complete the surrender and use this opportunity to make a fresh start, to move forward and to accept fundholding as it is. Such a step would be welcomed by doctors and patients.

The only changes that I am interested in making now involve looking at how we can spread the benefits further. Fundholding is and remains the Government's preferred option for involving GPs in purchasing. It is obvious that most GPs agree, as more than half are expected to have chosen that option by next April.

I turn now to the new opportunities for fundholding. The community option, which has been a great success for those who have taken it up, will take root soon. The community option gives GPs control of their immediate practice environment: the budget for their staff; community nursing services; the prescribing budget and direct access to diagnostic tests for their patients. All our expectations have been surpassed. More practices have chosen to enter community fundholding than entered the first wave of the scheme in 1991. There will be about 1,000 GPs in the community scheme alone.

Standard fundholding is not standing still either. It has been changed and developed, and it has been made simpler and more coherent. From next April, it will cover virtually all elective surgery and out-patient services. The changes to the scope of the scheme should resolve many of the bureaucratic problems reported by trusts which were caused by their not knowing which services were in the scheme and which were not.

The argument against the point that there is too much bureaucracy is simply this. We are happy to cut bureaucracy where we can do so. The White Paper "Putting Patients First" and the work that followed showed that we could relieve the burden of bureaucracy on GPs enormously. I am always happy to entertain suggestions about how we can do that. Under standard fundholding, everything will be included except emergency and urgent work, and the very rare and most expensive treatments.

In all, more than 3,000 GPs in more than 1,200 practices have applied to be fundholders from next April. That will mean that about 14,000 GPs, more than half of all the GPs in England, will have chosen to be fundholders. Between them, they serve more than half the population. I am confident that a similar story is emerging in Scotland, in Wales and in Northern Ireland. These are major developments, yet the Labour party would seek to put them in reverse.

I shall now say a word or two about total purchasing. From next April, GPs working at the 51 pilot total purchasing sites will have started purchasing all services for their patients. I have been especially impressed when I have visited the total purchasing pilots and seen all the work that is being done.

In Bromsgrove, GPs have employed nurses to visit patients admitted as emergencies. That has helped both the GPs and the health authority to understand better why some patients remain in hospital longer than others. It has also helped to ensure that patients are discharged appropriately into the community, and that the primary and community services are ready and available to receive those patients.

Other innovative work has been done there in bringing community midwifery forward. By ensuring that private nursing homes can be used to deliver respite care for their patients, GPs have helped to resolve many of the problems that the hospital had with beds being inappropriately used. Likewise, GPs in Runcorn have contracted for the secondment of midwives from provider units to their practice, to set up team midwifery and thus bring services far closer to patients.

All those projects are demonstrating how GPs involved in the direct total purchasing of care for their patients can help to introduce a radical culture change within a health authority. Under the old system, although there were committees that presided over all such matters, they probably gave more lip service than real attention to the needs of patients.

It was said that GPs were involved in purchasing under the old procedures, but if that was so, why is a system such as total purchasing, in which GPs have control, suddenly producing demonstrably better innovative services that under the old schemes were never thought possible?

That is a culture change of the most extraordinary and innovative sort. We seek to spread such culture across all health authorities, and when the new health authorities are up and running on 1 April next year we expect the new chairmen and chief executives to rank it among their top priorities.

The development of a primary care led NHS throughout the country means improving the links between primary and secondary care, and increasing the influence that GPs and their teams exercise over those services. It means giving GPs real power to influence the way in which services can best be shaped to benefit patients. It is about trusting GPs to listen to and reflect the wishes of the patients whom they see daily, rather than paying lip service to their good work and then depriving them of the means of carrying it out, as the Labour party wants to do.

That means real power, with real responsibilities and real money, not notional power, notional budgets and notional accountability. Only the Labour party would wish to reintroduce the endless committees, the centralised bureaucracy and the abrogation of decision making that was rife in the health service that we inherited in 1979.

What are Labour's plans for GPs and the primary health care led service that we want? What is its policy for primary care? What are Labour spokesmen saying when they tell GPs that they want to end fundholding? The truth is that they have no policies for primary care and no plans to use GPs' skills and abilities. Their message is a simple one: "Let's turn the clock back. GPs, go straight back into the box that you used to occupy. Stop fighting for what is best for your patients." In effect, Labour says, "Trust us, we know what's best; the old committees know what's best. We recognise that you GPs happen to have been developing services in a way that nobody could have anticipated—but too bad, we want you to stop, and we want to go back to the bad old ways."

I suspect that one reason why the Labour party is so determined to scrap fundholding is that it could not think of a way to rename it, as it has renamed the rest of the NHS. It will be interesting for my hon. Friends to hear how Labour has redefined the health service and its language, because the definitions are strange and marginal.

With some of the jargon words, Labour has made some really fundamental progress. What is now commonly known among professionals as the internal market, or the purchaser-provider split, Labour has heroically decided to rename; it is now called the "planner-provider split". What a difference that will make. Trusts will be changed fundamentally from their roots up; they will be called "local hospital services"—although I understand that trusts will not change their signs or letterheads.

Instead of the vile marketplace, which uses such disgustingly hard-edged words as "contracts", there would be "health care agreements". Labour strategists' problem is that they cannot find another word for fundholding, so it rather looks as though they are obliged to scrap it.

The difference between our parties is clear. GP fundholding and the move towards a primary health care led NHS have brought improvements in the provision of care, made services more accessible and provided a means by which GPs and their primary health care teams can have real power and responsibility, and can change the pattern of local health services to meet the individual needs of their patients.

I take the opportunity now to thank all those who have been involved in the pioneering of fundholder practices, including the health care professionals that GPs have brought into their practices, for the work that my colleagues and I—and, if they were honest and admitted it, Labour Members—see when we visit fundholders all over the country. The success of fundholding has exceeded the Government's expectations, and the people involved should be thanked for that.

Our policy is about levelling up; Labour's policy is about levelling down. Our policy is about giving doctors control over funds for patient care; Labour's is to patronise them and take that real power away. We have built an NHS that will meet the challenges of the 21st century, and today we have an excellent opportunity to debate the policies of the Labour party, which seems determined to destroy it.

10.15 am

Mr. Henry McLeish (Fife, Central)

I am pleased that the Government have selected fundholding to debate today.

Mr. Keith Mans (Wyre)

Delighted.

Mr. McLeish

We shall wait and see the delight develop in the next few minutes.

It is important to accept the fact that a primary care-led health service is what Labour wants and supports. There is no distinction between us and the Government there. GPs' role in that process is, of course, vital, but it is also important that we register our support for and applaud the work of every person who works in the NHS. Far too often in the House we have a knockabout over issues, principles or structures, but we in Britain are fortunate in having some of the most dedicated and skilled personnel working in all aspects of the health service. [HoN. MEMBERS: "Hear, hear."] That, at least, is a point that unites the House at this early stage in my speech.

It is important to talk about the political context of the Government's approach to health care. I do not want to destroy the morale of Conservative Members, but I hope that most of them have read The Daily Telegraph this morning. Probably because the Government do not listen, do not evaluate and do not care much what ordinary people think, the Conservatives are now 40 points behind in The Daily Telegraph poll.

I am quite happy for the Conservatives to plummet to historical new depths of unpopularity, but there must be a link between the unpopular policies for which the Government are famed, and electoral support. It is instructive that Tory party strategists in Smith square want to bury the issue of health. It is a weak issue for the Government. [HoN. MEMBERS: "Why are we here, then?"] That is what I want to find out. It is important to know, because it may represent a change of tactic by the Government. They are 40 points behind in the opinion polls, but now they think that health may be a winner. Is that right?

Mr. Malone

I am delighted that the hon. Gentleman has given way to me. The sort of news that we do not want to hear about the health service is the false news peddled by the Labour party. That is what John Maples, my successor as deputy chairman of the Conservative party, was talking about. Conservatives want to hear the truth about the new NHS that is delivering proper health care. On that issue we can be strong.

I had hoped that the arrival of a new health team on the Labour Front Bench would stop the peddling of untruths about the health service. However, the first instance arose at Question Time earlier this week, when the hon. Member for Peckham (Ms Harman), in order to make a clear political point, made the accusation that people in Winchester—my constituency—were having to wait more than 18 months for admission to hospital for orthopaedic surgery. After Question Time, I checked and found that that was simply untrue. I have written to the hon. Lady to ask her to withdraw her allegations, but I have yet to receive a reply. We do not want to hear untruths about the health service. We want to hear about what is happening.

Mr. McLeish

I am delighted that the Government are to engage in discussions on the NHS in the run-up to the general election. If they do so, I am convinced that the Opposition's 40-point lead will be increased.

The Government do not like certain concepts being discussed in their presence—for example, the two-tier health service that they have dismissed in relation to fundholding. In The Independent on 19 October, the new Secretary of State for Health said: fundholding certainly empowers the GPs in a way that makes it easier for them to improve services available to their patients. If that is not a comment about a two-tier health service, what is? [Interruption.] The Minister may mumble, but even the Secretary of State has acknowledged that GP fundholders who receive preferential contributions will inevitably and instinctively use them for the benefit of patients. That is not the issue, however. The issue is whether this country should have a two-tier health service.

Mr. Malone

The clear implication of the hon. Gentleman's argument on two-tierism is that all GPs should become fundholders and share the same benefits. That would get rid of the problem by levelling up, and not levelling down as the hon. Gentleman wants.

Mr. McLeish

I am happy to engage in discussions on levelling up, and the Opposition will give more detail on that in our commissioning proposals. But the Government cannot wriggle off the hook. The Secretary of State for Health acknowledges that the current system empowers GP fundholders to get a better service than non-fundholders.

It was instructive that the Minister did not spend more time in his speech on other activities in primary care, despite the fact that I asked him to do so. He did make a grudging and passing reference to those involved in commissioning, but we should not have a particularised view on what is good for primary health care. It is evident that the Government are obsessed with GP fundholding virtually to the exclusion of anything else that is happening in primary health care, especially in the multiplicity of commissioning options.

Mr. Mans

Does the hon. Gentleman agree that the present system also empowers health authorities—as well as GP fundholders—to get a better deal for their patients?

Mr. McLeish

That is a fair point, and I shall discuss that issue in detail shortly.

Mr. Jenkin

May I remind the hon. Gentleman that he welcomed the opportunity of having this debate, the proposed subject for which is Fundholding in a primary care-led National Health Service"? The hon. Gentleman can hardly blame my hon. Friend the Minister for discussing fundholding when it is the subject for debate.

Is the hon. Gentleman proposing that the fundholders' advantages should be spread to all other fundholders, or that those advantages should be removed? Will he address that point?

Mr. McLeish

Conservative Members are rightly anticipating what I shall be saying in a minute, but I give the hon. Gentleman an assurance that he can intervene again if I do not return to that point.

A two-tier health service is a prominent part of the Government's agenda, as is private health care. In The Observer on Sunday 6 August, the Secretary of State for Health—who has been making soothing noises about the NHS—confirmed that he has private health care as a "safety net", and added: My commitment as Health Secretary is to ensure that the service provided by the NHS is sufficiently good". That is an admission that we may be on the verge of a safety net service under the NHS.

Mr. Malone

indicated dissent.

Mr. McLeish

The Minister shakes his head, but we are used to that. The Government simply do not like the suggestion that their agenda is very different from the agenda of the British people, and, I believe, from the agenda of most GP fundholders, about whom the Minister waxed so eloquent today.

The Government are obsessed with GP fundholding to the exclusion of all else. An interesting letter appeared in The Guardian on 12 July, with the Minister being the subject of the discourse. The letter suggested not only that the Minister was obsessed with fundholding, but that he was making sure that his managers clocked up enough GP fundholders in the system so that they could get their bonuses and satisfy the Government's political objectives.

Mr. Malone

No.

Mr. McLeish

The Minister disagrees from a sedentary position, and I am willing to leave the matter there.

The Government will not come clean on their true intentions for the future of the NHS in the next century. Despite all the Government's concerns about primary health care, we have no doubt that, first, we have a two-tier health service and the Government are willing to continue to develop it; secondly, the Government are preoccupied with private health care as their first priority and the safety net NHS as their second priority; and thirdly, the Government will use every endeavour—above and below the table—to ensure that their political targets for fundholding are achieved.

Mr. Malone

I wish to put the Government's commitments firmly on record again. We are committed to the NHS as a tax-funded service that is free at the point of delivery. We are also committed to developing that service in the best way possible, something that the hon. Gentleman does not seem keen to do.

To suggest that there is some sort of private agenda is bizarre. The hon. Gentleman may like to ask some of the trade unions about private patient care, as they deliver private care as a benefit to some of their members. By talking about hidden agendas, the Labour party is getting into a bizarre world. I understand that the right hon. Member for Derby, South (Mrs. Beckett) recently became so excited about hidden agendas that she accused me of a having a hidden agenda of abolishing fundholding after the next election. However, I am glad that the right hon. Lady thought that I would be at this Dispatch Box after the next election.

Mr. McLeish

I have no vision at all of the Minister being at that Dispatch Box after the next election. Whether that cheers him up is up to him.

The Labour party is looking at primary health care and at the contributions made by GP fundholders and those involved in commissioning projects throughout the country. As politicians, we must build on the best. As politicians, we should want a service that provides for all patients and all doctors and in which exists the pluralism that the Government often talk about but never want to discuss in detail.

We must address the many issues that the Government will not tackle, two of which are the equity of access to primary health care and the equity of funding. Labour's approach is based upon and will be informed by a vigorous debate about equity of access and equity of funding. The Government's greatest weakness on that matter is to assume that because between 40 per cent. and 50 per cent. of fundholders are providing a preferential service, they can simply forget about the 60 per cent. who are involved in other types of health care.

Mr. Mans

The hon. Gentleman has made an important point about equity of access. Does he agree that equity of access inevitably allows someone to have something only if everybody else has it at the same time? Does not that effectively mean that there will be a levelling down to the lowest common denominator, not a levelling up?

Mr. McLeish

I do not want to narrow expectations or narrow horizons. Why do Conservative Members always refer to levelling down?

Mr. Jenkin

Because of the Opposition's policies.

Mr. McLeish

That is a matter of debate.

The Opposition are talking about levelling up and building on the best that is currently available. To finish this part of my speech, I wish to raise a matter with the Minister. In Britain, we are seeing the Government putting in the building blocks for the privatisation of the NHS.

Mr. Malone

No.

Mr. McLeish

The Minister disagrees, but trusts and fundholding are the building blocks for future discussions on privatisation. That is in sharp contrast to the Opposition, who believe that we should be boosting a blueprint for the renewal of the NHS. I hope that those outside the House will understand that there is a fundamental divide between the Labour party and the Government on the future direction of the NHS. We say that the Government are not seeking to develop any part of the NHS for patient benefit. Instead, they have a long-term strategy to dismantle and disaggregate what has been built up over many years.

The Minister talked about fundholding and my constituency. Earlier this year my wife died suddenly. My GP practice is fundholding. There is an excellent bunch of doctors doing an excellent job. My wife's GP suggested that because she could not get a scan, she should go to hospital in Edinburgh. He said that as he was part of a fundholding practice, that could be delivered. I had no problem with that and neither did my wife. She was at the front end of an extremely serious illness.

My wife had a scan. When she went for it, she was completely healthy. Two weeks and five days later she died. I appreciated fully this year the benefits that GPs provide and the benefits that my GP practice was providing. But whether it was a fundholding practice or anything else, it was all too late for my wife. I appreciated the qualities and the benefits that the practice delivered. With great respect to the Minister, I do not need lectures from him. My passion and compassion are focused on trying to ensure that the very service that my wife received is received by all.

Why should the service that my wife enjoyed not be available to and on offer by every other GP practice in my constituency? My approach to the health and primary care service is that we should build on the best. My wife and I had the best. She had the best in hospital. In her case, however, it was not enough. It is often useful that during our knockabouts in this place there is informed comment that is based on personal experience. I hope that the Minister accepts the spirit in which that comment is made.

Much has been said already about GP fundholding, but there are 95 groups and nearly 7,700 GPs serving 14 million patients by means of various forms of commissioning. We must take on board the problems, the issues and the innovations that come to light each day. The Labour party's approach is to build on the best of fundholding and commissioning. We are not saying to GPs in fundholding practices that important rights and important benefits for patients as well as important responsibilities for GPs should be discarded. Instead, we must focus on how best we can take things forward by combining the best of commissioning and of fundholding in a primary health care system.

I am sure that we, the Government and the Opposition will disagree on what the future should hold. The Conservative party should accept, however, that there is an alternative approach.

First, the benefits that have flowed to patients from both fundholding and commissioning should be recognised as constituting the important issue. Secondly, we, the Labour party, acknowledge the freedoms of GPs. It is their skills, commitment and dedication to the health service that motivate the entire system and produce improvements. That understanding must be acknowledged and embraced in any new programme. Thirdly, we must tackle unresolved problems. Fourthly, we must find a way forward that combines the two essential principles that fired the debate on 26 April 1948 in this place, which preceded the setting up of the NHS. Those principles were equity of access and of funding. Those core principles are applicable to the entire health service and to its continuation into the next century.

We, the Opposition, are putting forward a series of propositions. First, we say that the first priority of a Labour Government will be to develop commissioning proposals. We believe that they will prove attractive to all GPs. Secondly, GP fundholders will be absorbed into a new framework. Thirdly, GP fundholding will be eventually replaced by a new commissioning framework. Fourthly, we shall consult in detail with GPs about a realistic timetable for commissioning. That policy provides something that the Government's approach does not, and that is an opportunity for all GPs, whether fundholders or not, to participate in a system that ensures by means of a levelling-up process that the perceived benefits and freedoms of fundholding are available to everyone.

Mr. Malone

The crucial question is who will control the funds.

Mr. McLeish

With commissioning goes a number of other considerations that the Government sometimes ignore. First, we need collaboration among health authorities. It is—[Interruption.] The Minister has turned away from me. I have obviously satisfied him by fully meeting his question. I shall continue, however, for the record.

We are talking about commissioning, collaboration and partnership. The Government may not like those words, but it is obvious that those three approaches will be essential if we are to tackle some of the unresolved issues.

Mr. Jenkin

The hon. Gentleman has confirmed that in his commissioning framework he will remove the crucial advantage that fundholders have, which is exclusive control of the funds that they are allocated. The system in which he obviously passionately believes, bearing in mind what he has told the House, must embody fundholding control. Would it not be better for the hon. Gentleman to accept that we should be trying to extend that crucial control to all GPs rather than removing it and reducing what GPs can do for their patients?

Mr. McLeish

I fundamentally disagree with both the premise of the hon. Gentleman's argument and the conclusion at which he has arrived. If we are to have a detailed dialogue about the process that will enable us to have a commissioning framework, we must consider budgetary implications. It is important to recognise that the Government argue that all the benefits that have flowed from GP fundholding stem from budgetary control. In future, however, we must examine budgetary implications. We do not want to lose anything in the commissioning process that is of benefit to the patient and the doctor, and of benefit to the system generally. We propose to build on the best and to remove some of the excesses.

We, the Opposition, are confident that our policy will be a commonsense way forward. That will be the basis on which dialogue will take place. A recent speech by the Secretary of State for Health suggested that he is beginning to see things differently. When speaking to the Conservative political centre summer school in Cambridge, he said: There is no single blue print, nor has the government ever suggested that there should be. The important commitment is that there should be a determination to see the continued development of the family health services. We agree.

The right hon. Gentleman talked about no preconceptions and no closed minds. We agree. We agree also that there should be no rejection of ideas because they were not invented by us. Instead, as he said, there should be a clear commitment to strengthening and developing the role of the family doctor. I do not think that I have said anything with which the Secretary of State could disagree. If his speech at Cambridge signalled a change in the substance of the Government's policy, I welcome it. If it signalled merely a change of style, the right hon. Gentleman has much further to go before he arrives at where the Opposition are.

Let us take up the issues that were not mentioned by the Minister, which to me are inextricably linked to the future of primary health care, whether it is a GP fundholding system or the system that we are advocating. We have already trawled the issue of equity, so I shall not discuss it in great detail. I am willing to accept that comments in the press by Ministers agree with my view that a two-tier mentality is developing. The Government may say that that should act as a push to go on to something else. We argue that at no stage should there be a two-tier system where people who live in one street get the benefits of a service, but people who live in another do not.

We need to ensure that Britain is not divided into GP fundholders versus the rest or divided on the basis of geography. The analysis of the location of fundholding practices shows that they are to be found in some areas, but not in others. There is a geographical bias. There is also the question, upon which I do not want to dwell, of the sorts of patients whom fundholding practices may want to have or avoid.

The second issue that we need to consider is equity of funding. There is not equity of funding. That is a fact. Fundholding practices get better financial contributions than do other practices. Nobody is arguing against that. We need not dwell on the matter. If I were a GP and did not want to be a fundholder but wanted to do the best that I could for my patients, I would think badly of a situation that heavily discriminated against me and in favour GP fundholders. There is no logic or fairness in that system.

Mr. Mans

The hon. Gentleman says that there is no dispute, but what about the comments of Professor Glennester in his study of fundholding practices? He says that it is difficult to support the contention that, nationally, GP fundholders were systematically overfunded compared with what a national formula would have given them in the early years of the scheme.

Mr. McLeish

A trawl of his further comments would show that the professor simply does not know, because one of the key weaknesses of the Government's effort has been that there has been no proper evaluation of what has been happening.

Mr. Malone

Will the hon. Gentleman give way?

Mr. McLeish

The Minister should wait until I raise that issue. If he thinks that some objective evaluation has been done, he must be the only one in the medical community who does.

The third issue is that of equality of opportunity for GPs to participate not only in what the Government would call purchasing of care but in dealing with providers. There is still dialogue in each area about what is provided, but it is clear that the GP fundholding model sets up difficulties for and barriers between the purchasers and providers of care.

Mr. Malone

Let me deal with evaluation. The hon. Gentleman says that nobody knows of any evaluation. He may not have heard of the National Audit Office report on fundholding, which went into the matter in some detail. It states: The direct involvement of general practitioners in health care purchasing has led to improvements in the services provided for their patients and made fundholders more aware of the cost implications of their spending decisions. It went on to recommend to the NHS executive board that it should endeavour to ensure that the benefits of general practitioner involvement in purchasing, as demonstrated through the introduction of fundholding, are extended to all patients. If the hon. Gentleman were prepared to travel in that direction, I could find more common ground with him.

Mr. McLeish

The Minister has opened up a hornets' nest because I am going to deal in a big way with the reports of the Health Select Committee, the National Audit Office and the Public Accounts Committee. They make some pretty damning statements on the lack of information upon which proper evaluation can be based.

The fourth issue that I want to stress is the strategic input of the health authorities. It is crucial in any primary health care system that the health authority and the providers are involved in the care that is being provided and in the purchasing of treatment. In the public interest and in the interest of value for money for taxpayers, it is ludicrous that long-term contractual obligations can be severely undermined by a system of GP fundholding that often operates in isolation from wider concerns such as spot contracts.

Mr. Malone

indicated dissent.

Mr. McLeish

The Minister shakes his head, but the fact is that, where GP fundholders exist, there are major problems in that respect. It is one of the problems about which the Government are, again, blinkered.

The GPs have budgets; let them purchase care with spot contracts if they wish; but with such a myriad of contractual relationships developing, what about the providers? In Health questions this week, one of the Minister's hon. Friends, the hon. Member for Salisbury (Mr. Key), raised the question of the destabilisation of hospitals.

We should be interested not only in GPs being able to commission or purchase care but in the quality of providers. A primary health care system cannot work effectively when hospitals are destabilised to the extent that they can run out of cash and, more importantly, have no long-term future because they are not part of the particular privilege that has been given to GP fundholders.

Mr. Malone

I am sorry to disappoint the hon. Gentleman, but before he extends that argument too far, he should take into account some simple facts. For example, there is the accountability framework that has been published, ensuring that GP fundholders must take into account the implications of the possible service dislocation to which the hon. Gentleman referred. That includes the lodging and approval by the health authority of practice plans.

If there is going to be dislocation for a provider—the precise point that the hon. Gentleman was dealing with—practices have to give due notice, so that the provider unit at the hospital can adjust accordingly. The very points that the hon. Gentleman is illustrating are dealt with in the accountability framework in the fullest possible way.

Mr. McLeish

That does not square with the question of the hon. Member for Salisbury on 31 October.

Mr. Malone

My hon. Friend was wrong.

Mr. McLeish

Does that mean that anyone who criticises the Government has to be wrong? The question of the hon. Member for Salisbury stated: However, will he now look at a problem that has arisen and advise my national health service trust? Where that trust literally runs out of money, it is beyond doubt and political banter that patients suffer because non-fundholders cannot have equal access to the national health service trust."—[Official Report, 31 October 1995; Vol. 265, c. 90.] That was a Conservative Member. The Minister can accuse us of being politically prejudiced and a bit biased, but that was one of his hon. Friends. The Minister cannot continue to rubbish the comments of his colleagues and dismiss key issues about the strategic input of health authorities in the development of primary health care. Of course, that problem leads to another issue.

The Government always come to the Dispatch Box and lecture everyone on value for money. The Government have a problem, because value for money is often equated with least cost, but value for money is entirely different. The increased bureaucracy involved in certain aspects of primary health care surrounding GP fundholding means that a lot of money is being tied up in pushing paper.

Does the Minister accept the logic of the Secretary of State for Health who, after his Government have created an explosion of management, wants to cut it back? What are the Government doing to ensure that investment in management in GP fundholding is not done at the expense of patients? If, throughout the country, every GP fundholder has a budget, where is the accountability and the value for money?

Mr. Malone

In the framework.

Mr. McLeish

The Minister says that it is in the framework, but, in a sense, it is getting further and further away from real accountability and moving more and more towards the market model. The Minister is not unhappy with that, because that is his agenda. We are unhappy with that, because it means that taxpayers' money may not be spent to the best advantage.

There is also the matter of the long-term future stability of GP fundholders themselves. The Minister may want to answer this question: if every GP practice is a fundholder, how will they be funded? At present, the GP fundholders' budgets come from the health authorities' overall funding. There is currently an obvious discrimination in favour of fundholding practices, but if all practices were fundholders, would the Government plough in huge sums?

Mr. Malone

That is ridiculous.

Mr. McLeish

The Minister says that that is ridiculous. I wait with some anticipation for him to return to the Dispatch Box. Is there to be more money if preferential treatment is to be given or will money be taken away from GP fundholders and spread, levelling down, to use a phrase, to the non-GP fundholders?

Mr. Malone

There is no magic in this. Extra funds are given to GP fundholders because they exercise an additional management function that non-fundholders do not exercise. Non-fundholders have that function exercised by health authorities. If everybody were to become a fundholder, it does not take a flash of genius to understand that the function at present exercised by a health authority would then be replaced by the function at fundholder level. That is precisely what would happen.

Mr. McLeish

That has illuminated an issue for us: bureaucrats will simply be shifted out of health authorities into GP fundholding practices.

Mr. Jenkin

What a predictable comment.

Mr. McLeish

It is predictable, but predictable comments often make sense, especially given what the Minister said. He knows, and GP fundholders will appreciate it in the long term, that the financial stability of GP fundholders will ultimately not be what it is now.

Ms Hodge

If bureaucracy were transferred from one health authority to a large number of GP fundholders, would not that inevitably lead to an increase in the amount of resources spent on bureaucracy at the expense of patient care?

Mr. McLeish

That, too, was a predictable comment, but it was brilliantly penetrating in terms of the issue at stake and of what the Minister just said.

Mr. David Rendel (Newbury)

Is it not also true that, if bureaucracy is transferred from a health authority to the doctors concerned, GPs who have been heavily trained at great expense to the public to become doctors will then be used as bureaucrats?

Mr. McLeish

That, too, is a valid point. The deep disquiet within the health service is all about the financial nexus being pushed between patient and doctor. That is another example of what could happen in the future.

Mr. Jenkin

May I just thank the Opposition for expounding the Stalinist theory of public administration?

Mr. McLeish

That comment does not even rise to predictability, and I shall not waste the House's time in answering it.

Earlier, the Minister focused on one of the issues that we want to raise, when he made one of those comments that the Government liberally make about the benefits of GP fundholding. It is widely appreciated that benefits have flowed to patients, and it is clear that freedoms have been enjoyed by doctors. But whereas the Minister talks about objective evaluation, the same Audit Commission report that he quoted earlier says in its preface: There is a dearth of factual information about the scheme which has grown and changed at a very great rate. It has not been evaluated systematically and, although there are a small number of published studies, most tend to be based on comparatively small samples and have relied on fundholders' own assessments of their achievements. The Lancet of 28 October said: Our knowledge about fundholding is rudimentary. Many important questions remain unanswered. It then goes on to say: Even the scant results we do have must be interpreted cautiously. The question that we must pose is: on what basis do the Government make extravagant claims about the benefits of GP fundholding? The Minister has been energetic enough to rise to intervene in past exchanges, but I suspect that the Government have no interest in properly evaluating this exercise. Regardless of whether patient care is improving, the political benefits from the exercise are overwhelming. In the run-up to an election, it would be daft for the Government to evaluate what is happening objectively, in a scientific or non-scientific way.

Although the issue concerns the public purse, because the Government have invested much time and money in this development, they are now acting irresponsibly. They will not initiate research with a sensible methodology, which would give the House and the country a proper basis on which to evaluate the claims that have been made.

Mr. Congdon

I have listened carefully to the points that the hon. Gentleman makes. Earlier, he said that we have a two-tier service. That implies that fundholders are doing their purchasing better, so if the hon. Gentleman wants an audit of fundholders as he described, the searchlight should be on the poor purchasing of health authorities.

Mr. McLeish

That point carries no weight because, in a sense, privileges conveyed financially allow GP fundholders to exercise purchasing rights on behalf of patients. It is self-evident. The issue is not about fundholders and non-fundholders exercising different skills in terms of quality of care, which would be a different debate.

The Government cannot continue to parade those benefits before the country unless and until they have information on which that is based. They can do so in a political knockabout debate, but I hope that the National Audit Office and the Public Accounts Committee will soon examine why nearly 8 per cent. of the health service budget—£2.8 billion—is tied up in an experiment that has not yet been evaluated.

As a fellow Scot, the Minister may like to say why he took a much more cautious approach in Scotland, where he piloted projects that could be evaluated. If pilots have been carried out in Scotland, why are they not good enough for England? The Government are behaving irresponsibly and the Minister is silent because he knows that he does not have the information to make such ludicrous statements about achievements.

How can we have a partisan embrace of GP fundholding to the total exclusion of the other 50 per cent. of the country? I have already mentioned the figures. Are we to pretend that the treatment given to 40 million patients is of no significance to the Government? Are we to believe that 7,730 GPs are operating outwith Government approval because they have not yet had the guts to buy into GP fundholding? Or are we to believe that the 95 commissioning groups throughout the country are not doing a good job?

Does not that illustrate why the Government are so fundamentally unpopular? They hook into a certain obsession and relegate anyone who dares criticise it or does not come forward to be involved. The Minister cannot continue to conduct business in such a sensitive and vital area as primary health care with such a dogmatic attitude. Although I asked him, in his contribution, to discuss GP commissioning in its variety of forms, I had no response.

If one wants to build on the best, one must see what is happening in the various exercises throughout the country. Naturally, the Minister wanted to discuss GP achievements. Why, then, does not he go to north Cumbria and look at the alliance there, where group-negotiated funds for open-access exercise electro-cardiograms for all GPs have transformed access to cardiology for all patients? Why does not he look at the Blackpool, Wyre and Flyde GP advisory group's surgery-based dietetic service? There are lists and lists of good news stories.

Mr. Malone

rose—

Mr. McLeish

The Minister may now want to rescue his position, but he has simply ignored a huge swathe of innovation, activity and excellent things happening in the health service.

Mr. Malone

That was a bad example for the hon. Gentleman to choose. He may understand that, when party conferences are held in Blackpool, Ministers sometimes feel constrained to remove themselves from the winter gardens. I visited the commissioning practice of which he speaks and spoke to its members for an hour about what they do. I found that, although they have an innovative practice, they had had the utmost difficulty in getting the local health authority to agree to it, because they did not have purchasing power. They also came up with a list of proposals so that they could be given expensive management costs to carry out joint commissioning. That undermines the hon. Gentleman's point about it being a cheaper option.

Mr. McLeish

That contribution does not take away the fact that the Government are simply not interested in what is happening outwith GP fundholding.

I do not want to go on and on with other examples. It is a question of balance. Given that the Government are 40 points behind in an opinion poll conducted by a paper widely read by themselves, is it not time that they listened to those who do not embrace or applaud some of what they are doing in government? After 16 years, they simply do not care. That is the conclusion that you must reach, Mr. Deputy Speaker, after hearing the Minister's responses.

The Government have given no answers on a range of issues that are important for the future of primary health care, which is not developed in a vacuum. They include access, funding, the strategic importance of health authorities, equal access by GPs to providers in terms of dictating quality, and evaluation and objectivity in making claims. All those issues have been neglected. One cannot have a system of GP fundholding or GP commissioning that ignores in large measure the implications of those issues.

Worryingly, at a time when the Government have been partisan and particular, they continue to want to ignore some of the issues that I mentioned. I hope that, specifically, the Government will now initiate, arising from the debate, a series of far-reaching studies into GP fundholding and some of the other innovations that are taking place throughout the country.

We started the debate by saying that there was a fundamental distinction between what we, Labour, wanted to achieve in health care and what the Conservative Government wanted to achieve. Considering the Government's strategy logically, one recognises the classic signs of a process that was recently imposed on the railways, and is now being imposed on the health service—fragmentation, contractorisation and commercialisation. If the nation gave the Conservatives a fifth term, they would move to privatisation.

Mr. Piers Merchant (Beckenham)

Absolute nonsense. We do not want privatisation. It is not a possibility.

Mr. McLeish

To use a phrase much quoted this morning, the hon. Gentleman's response is very predictable. The Government are very uncomfortable when one says something that they want to keep hidden. Is not that true? It is true. As far as I am concerned, the partisan approach that they have adopted this morning to primary health care merely reinforces our belief that the Government do not care about the national health service but do care about that four-step process towards the marketplace.

Mr. Jenkin

It is evident that the hon. Gentleman and the Labour party do not want to campaign on the issue of what we have achieved in the health service. They want to campaign on what they pretend that we might do in future, which they know to be untrue.

Mr. McLeish

I have heard much better interventions from the hon. Gentleman. Perhaps, because I am reaching the end of my speech, Conservative Members are reaching the end of their concentration. I do not believe that that comment required a response.

The exclusivity of the Government's approach will be evident to all who witness the debate. However, the Government are failing to tackle other problems, which we cannot go into today. Morale in the primary health care service is not good. There are major problems with recruitment and work loads and problems with early discharges and emergency admissions.

We are in the ludicrous position, which affects the Minister's constituency among others, where nearly £100 million of surpluses from GP fundholders is sitting in the health authorities' bank. I cannot believe that we have a million people on waiting lists and we have £100 million sitting there. The Minister should take seriously the issue of whether that will be ploughed back over four years into GP fundholding. Or is it the Government's tactic to dip into that bank budget and spend it on reducing waiting lists? People will find extraordinary that conflict between a million people on waiting lists and £100 million stored in a bank and not being used. It is a scandal.

We shall be in government within 18 months. We now have an important task to speak to GPs and to consider the new era that will open up for them. We shall start doing so early in the new year. I am confident that the policies being proposed by Labour will mean one national health service, a policy for all patients and a policy for all doctors. We shall reduce that partisanship, that particularisation of GP fundholding, by building on the best and taking the whole system forward.

Ms Hodge

On a point of order, Mr. Deputy Speaker. Have you heard whether the hon. Member for Dover (Mr. Shaw) is intending to make a personal statement on the Government's decision not to privatise the harbour at Dover, especially because he appears to be the only person in Dover who supports such a privatisation?

Mr. Deputy Speaker (Sir Geoffrey Lofthouse)

I have no such information whatever, and it is not a matter for the Chair.

11.4 am

Mr. David Congdon (Croydon, North-East)

I listened carefully to the speech of the hon. Member for Fife, Central (Mr. McLeish). Initially, he tried to make a thoughtful speech and I believed that he would avoid the temptation to engage in party political banter. However, my hopes were not fulfilled, especially near the end of his speech, when we had the usual canard that the Conservative party, which has invested so much in the national health service and been responsible for its stewardship during most of its time since 1948, has a hidden agenda of privatisation.

If there is a hidden agenda, it must be well hidden. If the Government were intent on privatising the health service, why have they invested 22 per cent. extra in real terms in the national health service since 1990—an enormous sum? Many commentators say that not even a Labour Government would have had the ability to deliver such an excellent amount of extra resources to the NHS. That canard should be dismissed for what it is. It does not help the debate. We also had the usual canard about morale being bad. Someone said recently that morale has always been bad in the national health service. I do not accept that it is any worse now than it has ever been.

First, I should like to place the debate in context. Debates about the NHS have usually been about hospitals and there have been four or five debates in the past year or so about the health service in London. One of the reasons why debates have tended to focus on hospitals is that that is the glamorous side of the NHS, where doctors carry out high-tech interventions and receive much publicity when they do a heart and lung transplants and the like. As a result, the opportunity to debate the importance of primary care is lost.

Undoubtedly, primary care is becoming much more important because of the changes in secondary care—changes in the way that hospitals work. There is much less invasive surgery and much more day surgery. There is much more surgery which does not involve surgeons having to open up a person to find what is wrong, discover that there is nothing wrong and stitch them up again, having done a great deal of damage in the process. They are now able to find out what is wrong without doing that.

That leads to much shorter stays in hospital. It also leads to people who have had operations being discharged much earlier, which places more pressure on primary care services. That is why primary care services have rightly been forced to change, and will have to change much more during the next decade and as we enter the next century.

We are also witnessing the proper implementation of community care, which is leading to much more long-term care in the community, which also places pressure on those primary care services. However, significant changes to the configuration of hospitals, especially in London, have provided the opportunity for £85 million to be invested in primary care developments in London. Many have been in the north of the borough of Croydon. I am privileged to represent one of the constituencies in Croydon. There has been significant investment in GP surgeries in the north of our borough, providing much better care and facilities for the people of Croydon than in the past.

I note that yesterday a further £35 million was announced for various initiatives to help single-practice GPs in London. I am sure that other London Members will join me in welcoming the Government's initiative in that respect.

Mr. Malone

Does it not shoot down the Opposition's case that the Government are interested only in developing fundholding practices when, as recently as yesterday, I made that announcement, which means that single-handed practitioners, most of whom are not fundholders in London, will receive the benefit of flexibility payments to improve services for their patients, too? On equity, of course we are sensitive about allowing other services to develop where possible.

Mr. Congdon

My hon. Friend is absolutely right. I should say at this point, in case I create a different impression later, that I am primarily interested in primary care services delivered by GPs and their staff. I do not care whether they are fundholders or non-fundholders, but I do care that they should have the opportunity to deliver the best possible care for their patients. I happen to believe—in my view the evidence is strong—that when one gives the budget to GPs they are better able to decide where the money should be spent.

We should put the issue of GPs in context. I mentioned the extra pressure that GPs are under. There have been changes in the way that they work. There has been a significant growth in the number of GPs since we came to power in 1979. The numbers have risen from 21,000 to 26,000—an increase of 22 per cent. Doctors often say that they have a heavy work load, and I do not dispute that. But their list sizes have decreased from 2,300 to 1,900—a drop of 16 per cent.

Perhaps the most incredible change is in the number of practice staff. How many of us remember when we used to go to our GP and were lucky to find anyone else on the premises? The number of GP practice staff has risen from 20,000 to 54,000, which means that we can receive many more treatments at our GP surgeries without having to go to the local hospital for tests. That is why a primary care-led NHS is so exciting.

According to a recent MORI poll, nine tenths of patients are satisfied with the services provided by their GPs. GPs have always been the gatekeepers to other health services: they decide whether a patient should go to the hospital for a test or to see a consultant for further investigation. But until the reforms that introduced fundholding, GPs were gatekeepers with little power to exercise on behalf of their patients. They used to have to try to negotiate with consultants at the hospital, and it was a matter of which consultants they knew best, and perhaps even whether they went to the same golf club. That was not a transparent system of negotiating health care on behalf of patients.

Mr. Malone

The relationship between GPs and consultants can perhaps be encapsulated in a remark that I heard from a GP fundholder in London recently. He said that, five years ago, he used to send a Christmas card to a hospital consultant, but now the consultant sends him one.

Mr. Congdon

I congratulate my hon. Friend on that remark—he must be telepathic and is perhaps in the wrong occupation, as that was my next point. There has been a significant change in the relationship between GPs and consultants which has fundamentally changed the balance of power in the health service for the good of GPs and, more importantly, for the good of their patients. GPs now negotiate on behalf of their patients; they are not negotiating on their own behalf to protect or spend their budget. They use the power that their budgets give them to negotiate on behalf of their patients to obtain the best possible care for them.

The evidence is clear: GPs are able to negotiate better care for their patients. They have also been able to negotiate to ensure that more treatments are carried out in their surgeries. There are cases of GP fundholders negotiating with consultants and persuading them to come to their surgeries to carry out a clinic. What better way is there to run a health service?

It was alleged that GP fundholders would spend far less on drugs because they had control of the budget. The hon. Member for Fife, Central did not refer to the Select Committee on Health in his speech, but it carried out an investigation into the drugs budget. GP fundholders spend less per capita on drugs than non-fundholder GPs. More interestingly, the average value of the prescriptions that they give is higher than for non-fundholders. Significantly, they issue fewer prescriptions. The inference to be drawn must be that they prescribe more effectively.

Many doubts have been expressed and there have been many debates on the effectiveness of GP fundholders, as we heard some from the hon. Member for Fife, Central today. One source that has not always been a friend of the Conservative Government—the King's Fund—has acknowledged GP fundholding as one of the major successes of the health service reforms. We should give weight to its views.

The evidence is that fundholders manage to buy care far more effectively than health authorities. The question for Opposition Members to ask is why. There is no evidence that fundholders have been given more money for patient care than non-fundholders, but because they are much closer to their patients they manage their budgets more effectively. In many respects, that is not surprising. We all believe that we manage our financial affairs much better than the Government do on behalf of taxpayers. Large organisations do not necessarily manage budgets and other matters better than at local level. The challenge now is to put pressure on health authorities to exercise their purchasing power more effectively and to bring themselves up to the standard achieved by fundholders.

I wish to deal head on with the question of a two-tier service. Before fundholding was introduced, the charge from the Labour party was that it would lead to a two-tier service—but not the two-tier service that the Labour party describes today. The Labour party's idea of a two-tier service was that GP fundholders would have a pot of gold, which they would be so determined not to spend that they would deny services to their patients. The net effect would be that fundholder patients would receive poorer quality patient care than non-fundholder patients.

Mr. Rendel

The hon. Gentleman has just told us proudly that GP fundholders make fewer prescriptions for their patients than other GPs. He used that argument to show that they were more efficient. He now tells us that it is not true that fundholders provide less for their patients, and that they in fact provide better care. I cannot see how the two arguments fit together.

Mr. Congdon

I am sorry that the hon. Gentleman cannot understand the subtleties of the important point that I am making. Fundholders are given the same pot of gold as the health authority on a per capita basis; the important question is what they do with that money. Health authorities spend the money on behalf of GPs; fundholders spend it on their own. Fundholders spend less money on drugs than non-fundholders. They undoubtedly spend more money on some things than non-fundholders, and less on others. The net result is that there will be differences in the care provided.

It is my contention, and that of many others, that fundholders buy care more effectively. As a result, fundholders' patients are sometimes seen earlier than those of non-fundholders. That does not mean that there is a two-tier service, but that the fundholders buy a different pattern of care. The question that the hon. Member for Newbury (Mr. Rendel) must ask is what the health authorities are spending the money on and why they are not achieving the same success as fundholders.

The Opposition cannot have it both ways. If they say that there is a two-tier service, the logic of their argument must be—I make no apology for repeating it—that all GPs should be encouraged to become fundholders. The argument involving a two-tier service—if it is valid—would then disappear. There would still be differences within the service, because different GP fundholder practices would buy different patterns of care to meet their patients' needs.

The important question is whether we level up or down. Conservatives believe that, by introducing fundholders, we have improved standards, and we want all GPs' standards to be levelled up to the standard of the best. Opposition Members believe that there is a two-tier service and that the only way to achieve the end that they desire is to level down. I am sure that hon. Members will join me in rejecting that.

I am pleased that fundholding is spreading at a fast rate. Some 41 per cent. of GPs are now in fundholding practices and next year the figure is likely to be more than 50 per cent. To date, the figures in my borough have been disappointing, but I am pleased to learn that many practices are to become fundholders from next April. I am confident that they will reap the benefits of fundholding.

I have never been particularly wedded to one standard model. I accept that the needs of one group of GPs can differ from those of another. I therefore welcome the fact that we now have three possible varieties of fundholding: community fundholding for small practices which do not have the ability to buy a wide range of services; standard fundholding, which is being extended to include most elective surgery, out-patient services and specialist nursing services and—perhaps the most exciting development—total fundholding, where fundholders are responsible for buying all care.

I understand that emergency services are also included. There is a need to ensure that there are no gaps in the loop. There have been allegations that fundholders could have an incentive to delay treatment so that patients present themselves at accident and emergency units. There is no evidence to support that, but one solution is to give fundholders total responsibility for all aspects of their patients' care.

In developing and extending fundholding, we need carefully to examine transaction costs in the NHS. In that context, I welcome the publication in June by the NHS executive of the efficiency scrutiny into bureaucracy in general practice. I hope that all the proposals in that document are implemented. I shall mention one or two that are particularly important.

The implementation of the new NHS number is crucial in terms of being allocating costs back to fundholding and non-fundholding practices. That must go ahead quickly. The report states on page 14 of the summary: On present plans the software specification for standard fundholding does not cater for electronic data interchange.". I urge my hon. Friend to address that aspect, as it could play a key part in reducing the volume of paperwork which flows between fundholders and providers.

There is also a proposal to implement an NHS-wide clearing system from April 1996. At present, there is a big invoicing process between providers and fundholders. Unfortunately, on current plans, fundholders will not be included from April 1996. Will my hon. Friend address that, as it is important to reduce the need for paperwork going backwards and forwards in this age of modern technology. I could raise other points, but I simply urge my hon. Friend to ensure that the recommendations in that report are dealt with properly.

Let me turn briefly to Labour's so-called joint commissioning. I listened carefully in order to understand exactly what that would involve, and I have to confess that I am none the wiser. I know that it will not be real fundholding because the GPs will not have funds, so what is the difference between what the Labour party is proposing and what exists today for non-fundholders?

Health authorities are empowered and cajoled to engage GPs and GP fundholders in dialogue about what should he in their purchasing plans. There are collaborative plans, but how much say do GPs have in that process and how much say would they have in the joint commissioning process? Professor Howard Glennester says: Many GPs that have participated in that sort of activity get very frustrated by it … they are asked their views and then nothing happens and it just causes frustration and irritation. In other words, there is consultation and collaboration and then the bureaucrats in the health authority do what they thought of in the first place. That is why the proposal for joint commissioning is no more than a half-baked idea.

Another alternative that the Labour party thought up, but did not mention this morning, is shadow budgets. I am not sure what a shadow budget is. Presumably GPs would not actually have the money, but there would be a notional account and if they were lucky the right amounts might be credited or debited. We would need more details before we could consider such half-baked proposals.

Labour's arguments for joint commissioning do not stand up. There have been a variety of allegations about what is wrong with fundholding and mention has been made of two-tier services here and there, but when the allegations have been investigated, most of them have been proved false.

In future, of course, the links between doctors—fundholders and non-fundholders—and health authorities have to be very good and clear, but when I listened to the speech of the hon. Member for Fife, Central I was struck by the fact that he was living in a time warp. He implied that fundholders were given a pot of gold and could do exactly what they liked with it regardless of the strategy of the health authority and the needs of the locality.

The reality is quite different. My hon. Friend the Minister referred to the framework document, which sets out the role of the health authority. The health authority has to assess the health needs of the population in its area. It has to prepare a strategy in line with the overall objectives of the national health service. It then has to purchase care for GPs who are not fundholders in line with that strategy. It also has to ensure that the plans of fundholders are in line with that strategy.

It is not a matter of GP fundholders getting together on a rainy afternoon to cobble together some plan that threatens their local general hospital and suddenly implementing it without anyone knowing about it. If they wish to make significant changes to their purchasing plans, they have to submit them six months in advance to the health authority which has a clear and direct role in the strategy, albeit that it does not purchase health care directly for fundholders. Opposition Members too often neglect that point.

I am firmly convinced that fundholding is the right way ahead for the health service. At last it has put the money close to the patient. Ideally, the money should be in the hands of the patient, but that is not realistic. Fundholding is a good second best and is achieving excellent results. I hope that we can build on those results because the system is so responsive to patient needs.

If all GPs cannot become fundholders—there will be problems in that respect, for reasons that we all understand—or at least community fundholders, we must find ways of giving a surrogate power to the residue of GPs unable to participate fully in the scheme. I want all GPs to benefit from the advantages of GP fundholding. I certainly do not want to turn back the clock, as advocated by the Labour party.

11.28 am

Mr. David Hinchliffe (Wakefield)

I am grateful for the opportunity to participate in the important debate this morning. I begin by commenting on the excellent speech by my hon. Friend the Member for Fife, Central (Mr. McLeish) from the Opposition Front Bench. It was his debut at the Dispatch Box, and he made a commendable speech that clarified Labour's position on GP fundholding while totally exposing the Government's current position. All hon. Members will agree that my hon. Friend courageously raised certain points that were drawn from personal experiences.

One reason why I decided to return to the Back Benches is that, over the past three years or more, I have felt somewhat inhibited in raising detailed concerns about specific developments in my constituency in debates on the health service. When I was at the Dispatch Box, the last thing Back Benchers wanted to hear was detailed concerns from a Front-Bench spokesman about his own constituency.

As the Minister is well aware, I want to spend some time today on the detailed implications of GP fundholding for my constituents in Wakefield.—[Interruption.] If the hon. Member for Croydon, North-East (Mr. Congdon) cares to listen, he will hear evidence that clearly shows that some people are deeply concerned that fundholding has created a two-tier system. I shall not only give examples, I shall name names. I can show Conservative Members letters that I have received—I have already shown the Minister some—that demonstrate clearly the effects of a two-tier system on my constituents.

Mr. Congdon

I am happy to accept the hon. Gentleman's examples in the spirit that they are given. If what he says is true, is not that evidence of the health authority not exercising its purchasing function as well as GP fundholders exercise it?

Mr. Hinchliffe

If the health authority was here, I think it would say that we should be examining the money available to fundholders compared with that available to non-fundholders and the health authority. The hon. Gentleman points a finger at the health authority, but it was set up by the Government, and its chairman was appointed by the Government. They cannot blame the very people whom they put in place. It is the system that is wrong, as I shall show throughout my speech.

Mr. Malone

Before the hon. Gentleman does that, we must be clear that the implication in what he has already said, and in what the hon. Member for Fife, Central said, is that there is some huge disparity in funding for patient care. I want to put the basis of funding for patient care clearly on the record. Fundholders get a fair share of NHS resources, which is calculated by the historic use of services that their patients made of them before they became fundholders, and which is now modified by movement to a local capitation benchmark. It is a fair allocation system.

I hope that the hon. Gentleman will distinguish between the funds that are allocated fairly for patient care, which fundholders manage, and the funds allocated to carry out the management function of fundholders. It is clear from what Labour Members have said so far that the two points are being thoroughly confused.

Mr. Hinchliffe

I shall give way to the Minister later if he will put on his thinking cap and find a reason for underspent resources within fundholding practices in Sheffield, while non-fundholding practices are unable directly to obtain health care purchased by the health authority in exactly the same specialisms in the same hospital. The two-tier system is not just between different areas: it is within the same district general hospital.

Before going into detail about local issues, I want to make one or two broader points of relevance to the debate and to reinforce the eloquent comments of my hon. Friend the Member for Fife, Central, who outlined the Labour party's belief in primary care. I have been very closely involved with the health service at local level over many years. I worked in local authority social services and therefore dealt with GPs and hospitals on a day-by-day basis. In fact, at one point I was practice based with a GP, so I worked very closely with a primary care team.

I recall a time before 1974 when I worked in the same building as district nurses, health visitors and midwives. The model that operated then, especially in respect of collaboration with child protection services and community care, was fundamentally better than the present model. That much better system was scrapped by a Conservative Government in the early 1970s. The Minister talks about looking forward to this or that development. I look back on the many positive elements that existed some time ago, which his party wrecked in the 1970s.

For many years, the power in the NHS has been primarily in the hands of hospital consultants. I do not think that there is any difference between me and Conservative Members on that point. I accept that moves have been made to enhance the power and status of general practitioners. That is simple common sense; anybody wanting to develop an effective primary care system would do that. I also accept that fundholding has enhanced the powers of certain GPs. Indeed, I have personal friends who are fundholding GPs. I also know some local GPs who became fundholders not because they believed in the system, but because they saw it as a way to obtain more money and to queue-jump their patients—something that many people find unacceptable. I do not blame them for fighting for their patients; I blame a system that has created two-tier health care.

I accept that effective general practice is fundamental to a properly run health service. As has been said, it is the linchpin, and has been from the word go. However, we have never facilitated general practice in a way that would allow it to play that crucial pivotal role, so obviously I welcome any moves in that direction. My party recognises the need increasingly to examine ways to improve primary care because that is fundamental to improving the health of the nation.

I served on the 1990 Standing Committee that considered the National Health Service and Community Care Bill. I privately felt that we had failed to understand that fundholding was potentially a greater threat to the central principles of the NHS than the purchaser-provider split and trust status. I felt strongly that the Government were taking a huge leap in the dark by introducing fundholding without any attempt at a pilot scheme, any sort of experimentation or any evaluation of different models. Instead, they went straight in at the deep end. Now, unfortunately, in my area and other areas, including the Minister's constituency, we are having to pick up the pieces of the Government's failure to consider the possible results of fundholding.

We could all describe personal and practical experiences. My hon. Friend the Member for Fife, Central mentioned a few. The hon. Member for Croydon, North-East referred to equal funding. The Minister, when he intervened, made it clear that a great deal of money is thrown at GPs to encourage them to become fundholders. Many of them have spent lavishly on their premises—money that some might argue could have been better spent on patient care. We could argue all day about equality of funding, but the simple question is whether the system for allocating funds is the best use of scarce public resources. I am not the only one to ask that question.

Mr. Malone

Before the hon. Gentleman goes too far in denigrating doctors and the way in which they spend any savings, I want him to understand that the savings that. fundholders make have to be audited and schemes upon which they spend any savings must be approved. The hon. Gentleman referred to improvements in surgery premises. Surely he should welcome those improvements, which often mean that other health professionals can be included in new premises, thereby giving standards of patient care that are not available in the old-fashioned, clapped-out premises that are being replaced.

Mr. Hinchliffe

If the Minister cares to visit God's own county of Yorkshire, I will take him to a city not far from where I live, where there are some very innovative uses of fundholding money. One practice—the hon. Gentleman probably realises that I am talking about Sheffield—set up a private hospital and referred patients from its practice to its hospital. The doctors were making a large amount of money.

I am sure that the Minister will accept that, in many areas, an objective analysis of fundholding has raised serious questions. I am not denigrating fundholding GPs who have genuinely attempted to improve their service at practice level. I do not suggest that all fundholders are necessarily bad. As I said, I know a number of fundholders and, as a shadow Minister, I recently addressed the Yorkshire fundholding group. We had a very interesting dialogue. The group understood where I and my party were coming from and some of our reservations about a system that creates the anomalies that I shall describe in a moment.

Ms Judith Church (Dagenham)

Like my hon. Friend, I represent an area in which there is great inequality in health care. I have met local fundholding and non-fundholding GPs to discuss the effect of fundholding on inequality. Do GPs in my hon. Friend's area think that fundholding is doing anything to reduce inequality? In Dagenham, they think that it serves merely to widen inequality in health care.

Mr. Hinchliffe

I shall outline in a moment exactly what non-fundholding GPs think that fundholding has done. They think that it has increased the inequality that already exists. I shall illustrate my point with reference not to my views but to those of GPs who have set out in their own words what they think about the current position.

I have listened many times to Conservative Members saying that the market will resolve any problem. With the National Health Service and Community Care Act 1990, we introduced the market into primary care. The idea that competing, thrusting GPs would fight on behalf of their patients, and that practice would fight against practice, to get what is best for their patients is absolute nonsense.

As the Minister knows, right from the word go fundholder cartels were established. The Wakefield metropolitan district fundholders immediately appointed someone to work on their behalf and block contract purchase. Straight away, there was a complete monopoly of purchasing. I heard in Committee and in the Second Reading debate on the 1990 Act that the competitive, thrusting market would somehow enhance patients' rights and their access to treatment, but from the start we saw the establishment of block collaborative purchasing by fundholders. That happened not only in my area but across the country. Block purchasing is worth examining in its own right, because it has implications for the planning of health care.

Mr. Malone

The hon. Gentleman mentioned what is happening in his area. In fact, 81 per cent. of the population there are now covered by fundholding practices. A large fundholding project has resulted in savings of £820,000 to be spent on patient care. Those uncaring fundholders have also returned to the health authority £217,000 worth of savings for general spending. I should have thought that the hon. Gentleman's own area is an ideal example of the benefits that fundholding has provided.

Mr. Hinchliffe

The Minister used the term "uncaring fundholders". That is his term, not mine. I hope that he will be as happy to intervene when I have spelt out my concerns about what is happening in Wakefield. I have already raised my concerns with him and the Secretary of State, and did so with him again this morning. I am getting a little impatient because I am not getting answers to questions that are directly relevant to the meat of this debate.

Before I go into detail about my locality, I shall make one or two further points on the wider issues that need to be examined. I have mentioned the collective purchasing by fundholders. Important questions need to be asked about what collective, collaborative block purchasing means for local health planning.

Mr. Stephen

Will the hon. Gentleman give way?

Mr. Hinchliffe

With respect, I have taken a number of interventions and still have some very important points to make.

I believe that local health planning is being wholly undermined by the collective purchasing power of fundholders. It is a simple fact that their collective purchasing power increasingly renders the planning role of local health authorities redundant. Fundholders have the power to shift contracts and, effectively, to close hospitals. They have the power to close key local services. To whom are they accountable?

Health authorities and trusts at least have a token accountability. If one looks through one's local newspaper, one might, if one is lucky, find a notice stating that the local trust or health authority is having a public meeting. Usually, only about three people turn up, because few know about it or know what the trust or health authority does these days. However, there are at least token meetings.

Who can influence the decisions of fundholding blocks? Where is the public accountability? Where can my constituents go to ask why fundholders have decided to shift a contract from hospital A to hospital B, with the resulting implications for services at hospital A? Such issues are fundamental to our belief in a national health service that offers people equality of treatment. Frankly, that framework has gone by the board. The Government did not think through these issues, which are increasingly coming home to roost in areas such as mine. People who can spend millions of pounds are completely unaccountable to the public. How can my constituents influence fundholding practices?

Mr. Malone

Before the hon. Gentleman accuses me of not rising to deal with that point, I should point out that I shall deal in great detail with the accountability framework and what it implies when I wind up the debate.

Mr. Hinchliffe

The hon. Member for Croydon, North-East mentioned the tie-in between general practice and community care, which is an important point. I had Front-Bench responsibility for community care policy and travelled around the country, talking to many people about the implications of fundholding on community care, child protection and the services that work alongside general practice.

I hear worrying tales from people working in mental health who are responsible for implementing the new supervised discharge order. They say that it is nonsensical that local GPs are bringing in community psychiatric nurses from outside the area who are not involved in the local collaboration process. GPs are also purchasing health visitors and midwives, people directly involved with the nitty-gritty of child protection. Those people have no relationship with local social services.

That undermines completely collaboration on key issues such as child protection. I fear that, before very long, when something has gone badly wrong, we shall be hearing of yet another inquiry into child abuse. I predict that one issue that will arise from that will be the fact that fundholders are buying services from outside their immediate area and that that undermines proper local collaboration.

Mr. Merchant

The hon. Gentleman referred to the buying-in of services by GP fundholding practices. Surely GPs take decisions in the interests of their patients. He betrays a lack of faith in GPs if he believes that they cannot make the best choice for their patients in these circumstances.

Mr. Hinchliffe

I have a great deal of faith in GPs. The essence of what I am saying is that I want them to he given more power. General practice has a crucial role to play, but we need to think through the consequences of fundholding for community care and personal social services.

I am told by community psychiatric nurses that fundholders do not understand their role. One CPN told me recently that it was sad that, instead of being brought in to deal with seriously mentally ill people, CPNs were being asked to deal with those described as the worried well, people who have various neuroses of a not very serious nature and do not need the skills that CPNs have. The Government have not even started thinking about such problems.

I focus now on an issue that I mentioned in an intervention on the Minister and which has been bandied across the Chamber—the two-tier system created by fundholding. My fundamental objection to fundholding is that it completely undermines what I felt was a cross-party belief in the equity principle of the national health service, which has been there right through from the 1940s: the belief that if people pay into a system, they have a right to expect equal access to that system and that they can get the same treatment as others in an area. That has been blown out of the window by general practice fundholding.

Mr. Mans

Does the hon. Gentleman believe that that equity principle applied in practice during the past two periods in which there was a Labour Government? Was there equal access across the country to medical facilities, as was suggested in 1948 when the NHS was founded?

Mr. Hinchliffe

One of the issues that we have had to address right through from the very brave decision of the Labour Government in the 1940s has been that of equity across the country. Of course I concede that there is different access in different parts of the country. I understand that. Indeed, Government after Government have had to address such issues. We had the Resource Allocation Working Group. Now there is the reverse of RAWG, whereby inner-city areas in the north of England have been robbed of funding to shunt it to the opulent south of England where there is less pressure on the health service.

I travel around the country and see many people. I accept the fact that there have always been differences, and successive Governments have attempted in their own ways to address them. But there have not in my experience been differences in the same hospital between patients living in the same community, served by that hospital. That scenario has arisen, and I shall spell out in some detail how it applies in Wakefield. The equity issue has been raised with me by my constituents who want to know why they are denied treatment that their next-door neighbours can get on the basis of which practice they happen to be registered with.

Over considerable time, anecdotal evidence of the two-tier system operating in my constituency—it depends on the status of a person's GP—has been given to me. In July, a constituent came to see me. All the constituents whom I am about to identify have given me their permission to mention their names and their circumstances. If the Minister wants, I will show him the correspondence in each case—it is with me today—which spells out their feelings in their words.

In my surgery in July, I saw a Mrs. Doreen Armitage, who lives in Alverthorpe, Wakefield. She is a 65-year-old widow who, along with her late husband, spent many hours raising thousands of pounds for Pinderfields hospital from charity work. Some time ago, that lady was injured in a road accident. She broke her neck and fractured her femur and, as a consequence, needs a hip operation. She was told after an X-ray at Pinderfields hospital on 15 December 1994 that her operation would take place between four and six weeks later and that she would be "admitted on a phone call". That was later amended to four to six months and, later still, her daughter was told that the operation would be at the end of June or in July.

Mrs. Armitage rang the hospital again in mid-July and was told that the operation would definitely take place in August. That was amended again because—she was quite clearly told this—her GP was not a fundholder. She was told that the operation would take place in December at the earliest. That lady is in acute pain to the extent that she cannot function on her own and has had to leave her home in Wakefield to live with her daughter in Scunthorpe.

In September, I had a letter from a Mrs. Mary Parkin of Thornes, Wakefield. This lady is a 79-year old widow and happens to be the mother of somebody who was in the same class as me at school. I have known her for many years. She is of my parents' generation. She is awaiting a hip operation in pain and discomfort. She is also a patient of a non-fundholding GP. After writing to the chief executive of the Pinderfields hospital trust, she received a letter from the chief executive dated 15 September, which said: Pinderfields is in negotiation with Wakefield Healthcare over the funding of operations from non-funding GPs in Wakefield. Problems have arisen in recent months as the hospital has carried out all the operations it has been contracted for". That is no real comfort to Mrs. Parkin, who is in great pain.

In October, I was contacted on behalf of a constituent, Mr. Robert English, who lives in Eastmoor, Wakefield. He is a 54-year-old man who has been suffering from a painful hip condition for more than a year. It was initially diagnosed as arthritis, and because of his concern, he ended up, as so many people have to nowadays, paying privately to see a consultant, who diagnosed a fractured hip.

That man has been in considerable pain while waiting for the operation that he requires. When he rang the secretary of the hospital consultant concerned, he was asked whether he was the patient of a fundholding GP.

This week, I was contacted on behalf of a Mr. David Garlick, a 77-year-old man who lives in Wakefield. He has been treated since 1991 for a painful hip condition. His GP told him in 1991 that he required a hip replacement operation. His consultant told him in December last year that he was on the waiting list, and that an operation would be carried out before May 1995. He was told in July that the operation would go ahead in August. In late August, Mr. Garlick was told that the operation could not go ahead until after Christmas due to a shortage of funds. His GP is not a fundholder.

Mr. Reynolds, from Flanshaw, Wakefield, was a miner for 28 years and after that worked as a hospital worker. He is suffering from osteoarthritis of the hip. He was referred to hospital in October 1994. He was seen by the consultant after that referral on 19 April 1995, told that a hip replacement operation was needed and that he would have to wait two months. He is still waiting. He has been told by his own GP that the delay is because his general practice is non-fundholding.

Mr. Stephen

Will the hon. Gentleman give way?

Mr. Hinchliffe

If the hon. Gentleman would let me finish my point, I will give way later.

I would like to finish the point by giving my opinions. This morning I received a copy of a letter sent on 31 October by the Wakefield non-fundholding practices, representing the various surgeries in Alverthorpe, Chapelthorpe, Church street in Ossett, and Grove and Kirkgate in Wakefield. Most of them are in my constituency and represent 36,370 patients—most of whom live in my constituency—including, by the way, myself, my wife and my children, because we are very happy with the service provided by our non-fundholding general practice.

The letter sent to the chief executive of Wakefield health authority is quite lengthy and asks a number of important questions. It makes the following point: We understand that our patients who are already on Waiting Lists will not receive Elective Surgery in ANY speciality, because the budget has been spent. We also understand that the Budget was £2 million less than the last financial year. We are very concerned that our patients are not receiving the same standard of care from Pinderfields Hospital Trust as patient from Fund-holding Practices. The letter goes on to ask eight questions, and I shall mention one. It said: We have been led to believe that the Fund-holding Practices are financed to the same level as the Non-Fund-holding Practices. If this is so, why have the Fund-holders not run out of money? I have raised the matter with the Secretary of State in writing. I have a letter sent to me by the Minister on 16 October, in which he says—he probably has a copy of it with him which he might be able to fish out—that he was sorry to learn that my constituent, Mrs. Armitage, the first one who came to my notice, has been asked to wait. He said that he understands that, in relation to the case, Wakefield Healthcare issued a statement confirming its policies to treat patients according to clinical priorities and that that is in line with national policy. He mentions joint guidance and also says that the statement refers to additional funding, which I understand amounts to £800,000 for Wakefield, made available to reduce the length of time which people have to wait. I welcome that additional funding; I am not grumbling about that. I am asking why some people can get treated and some cannot; that seems fundamentally wrong.

The Minister writes: I understand also that in mid-September the Wakefield Fundholders' Group, which represents a number of local GP fundholders, wrote to Pinderfields Hospital NHS Trust reaffirming that treatment should be given to their patients and others on the basis of clinical need. I am not arguing that the fundholders in Wakefield want a two-tier system; I do not believe that they think it acceptable that some people are winners and some are losers, any more than I do. I do not blame the fundholders; I blame the system, and the Minister will have to respond to that point.

The Minister writes: I hope this information helps to reassure you that both Wakefield Health Authority and GP fundholders in the Wakefield area aim to ensure equitable treatment for all patients based on clinical need and clinical priority. What the Minister does not do is answer the central question. We have a two-tier system; the Minister knows it, and I know it. The Minister will not answer my question.

Mr. Malone

The hon. Gentleman has had a 20-minute backswing before coming to this point in his argument. I checked the record of the letters I received about these cases. I received one letter that related to the case of Mrs. Armitage; the hon. Gentleman has quoted the reply. I have learnt from experience never to comment without the fullest information on cases such as those which the hon. Gentleman has quoted to the House today. On a previous occasion, I was told of somebody who had not been able to get an operation because it had been cancelled. I discovered that the patient had pushed off to Greece and that that was why the operation had been cancelled. One has to have a care when looking at these issues.

If the hon. Gentleman writes to me about all the cases that he has raised on the Floor of the House today, I shall happily look at them and ensure that the actions taken have accorded with Government policy. In general terms, I ask him this. Is he saying that none of these patients has been treated on the basis of clinical priority? Is he saying that none of these patients has been treated within the terms of the patients charter? What does he have to say on those two general points?

Mr. Hinchliffe

In a moment or two, I shall tell the Minister exactly what I am saying. What I want from him is an answer to the central question. He has dodged the point. In my letter, I asked him to explain why fundholders' patients could get access to treatment whereas people such as Mrs. Armitage and the others could not. Those people are being denied treatment and that is the issue.

The Minister was here on Tuesday when I raised the specific points with the Secretary of State. Why should people be asked, when they ring a hospital, whether they are the patients of fundholders or non-fundholders? What difference should that make? They are ringing a hospital about their needs. Why should their status make a difference to their treatment? It clearly does, and we can prove that it does.

Mr. Stephen

rose—

Mr. Hinchliffe

The answer given by the Secretary of State—

Mr. Stephen

On a point of order, Mr. Deputy Speaker. Is the hon. Gentleman refusing to give way to me on the ground that I am not a fundholding Member of Parliament—

Mr. Deputy Speaker

Order. When the hon. Gentleman rose to his feet, he knew full well that what he was about to say was not a point of order. It is for the hon. Member for Wakefield (Mr. Hinchliffe) to decide whether he gives way, and the hon. Gentleman knows it.

Mr. Hinchliffe

I have not been exactly ungenerous in giving way. I am making a point, and I think that the hon. Member for Shoreham (Mr. Stephen) understands that.

I am losing my patience with the Government on this issue, because they will not give me an answer to my question. I do not know how much further I need to take the matter. I spelled out my question to the Secretary of State on Tuesday and I spelled it out to the Minister this morning. The answers I get are not a response to my question.

I want to know why we have a two-tier system and what the Government intend to do about it. Quite simply, the answer is fundholding and the Minister knows it. The problems are a direct, logical consequence of the system that he and his colleagues have introduced. We have an internal market, with winners and losers. The people who come to me are the losers. Incidentally, they would love to be able to go to Greece, but most of them could not walk to the taxi to get there. I can give all the case files to the Minister this morning. I hope that he will then give me an answer.

On Tuesday, the Secretary of State said that the Government had a commitment to treatment on the "basis of clinical need". That sounds very nice, but that commitment does not seem to apply in my constituency. Why have fundholders' patients been treated in the orthopaedic department at Pinderfields hospital when non-fundholders' patients have not been? If that is not a result of a two-tier system, what is the reason?

If the Minister does not believe what I am saying, will he look at the operating list at Pinderfields hospital? Will he check who the patients' GPs are? Will he tell me how many of those treated recently came from non-fundholding practices? I should be interested to know. I know for a fact that the money has run out for non-fundholders' patients. They cannot be treated because there is no money to pay for treatment. The money is not there. We see the two-tier system that we have predicted in all its glory. How sad it is that people have to suffer to prove the point.

We have been told that there is no district health authority funding for orthopaedic operations. I am aware of an underspend in certain fundholding practices in our locality. That is our money—taxpayers' money, as the Government would say—and not the GP fundholders' money. Why could that money not be used to fund people like Mrs. Armitage, Mrs. Parkin and Mr. Garlick? If we have a logical system and if there is equity, the money should be used to obtain patient care, instead of being stuck in GPs' bank balances.

My constituents want answers from the Minister. I do not blame the Pinderfields hospital trust; it can treat only the patients it is paid to treat. I do not blame Wakefield Healthcare trust because I know that it has fought for and obtained more money to address the orthopaedic problem. I learned late last night that Mr. Garlick has received a letter asking him to go into hospital because it now has more money. Mr. Garlick, however, is a victim of the two-tier system; he has been waiting since 1991 and he should have had his operation a long time ago. As a non-fundholder's patient, he has been cast aside like the others. There are probably many more cases of which I am not aware.

I do not blame Wakefield Healthcare. I blame the Government for introducing a system that creates two tiers, winners and losers, and a fast track and a slow track. The Minister may blame my hon. Friend the Member for Peckham (Ms Harman) for raising what has happened in his constituency. My hon. Friend simply repeated what was in the national press. I read the articles with interest and thought that the Minister might sympathise with my situation in Wakefield. Let us get back to addressing the real issues of equity.

I was impressed when my hon. Friend the Member for Fife, Central described models that would enhance the role of GPs and the role of primary care. We do not have to create a two-tier, fast track and slow track system to achieve those ends.

12.7 pm

Mr. Keith Mans (Wyre)

I am pleased to speak in this health debate. It is the first time that I have had the privilege of speaking in a health debate for more than five years. The hon. Member for Wakefield (Mr. Hinchliffe) will not agree with many of my remarks, although we do have one thing in common. We have both recently returned to the Back Benches, which allows us to speak our minds in our different ways.

During my five years in the Department of Health as a parliamentary private secretary, I saw the latter stages of the planning of the reforms, the initiation of the reforms and their subsequent progress. I was also involved in evaluating the results of the reforms. My hon. Friend the Minister set out clearly the advantages, in terms of the number of patients treated, that the reforms had allowed—over and above the extra resources, in real terms, that have been provided by the Government since 1990.

I make that point because we must bear it in mind when we are discussing fundholding or any other issue involving the NHS as we see it today, Over the past five years, there has been an increase in real terms in the number of patients treated in the health service, at least part of which can be explained only by the fact that the service is running more efficiently as a result of the reforms.

There has also been a dramatic decrease in waiting times. Yes, the overall waiting list as such may have increased, but all that that shows is greater demands on the NHS. Many of the people on the list are waiting only a matter of days or weeks, or in a few cases months. What is important is the fact that we have brought the total waiting time down for people who require hospital treatment.

That applies to patients both of fundholding and of non-fundholding practices throughout the country. I would like there to be more evaluation so that we could see, on a health authority by health authority basis, how much better the health service is now than it was five years ago. The Minister knows that I pressed that point several times when I was a parliamentary private secretary.

I should like to see exactly what is happening now in my area, Fylde, compared with what was happening five years ago. If we had more such information, we could draw comparisons between different parts of the country so that we could see where things were right, and where we had the right procedures.

Ms Church

I know that the hon. Gentleman has a background in health and in management, and I support his request for proper information and evaluation, especially as between fundholding and non-fundholding GPs, the service that they provide for their patients and the contribution that they make to reducing inequalities. Can the hon. Gentleman explain how the Government can make claims about GP fundholders and improvements in the health service, when they have carried out no studies? Indeed, as my hon. Friend the Member for Fife, Central (Mr. McLeish) said earlier, the Audit Commission report greatly regretted that no proper systematic studies had been carried out. What is the point of making claims when there is nothing to base them on?

Mr. Mans

The hon. Lady makes a good point in terms of the amount of information that should be made available at district level. But I also disagree with her, in that there is already a fair amount of information available at national level, in the figures published by the Department of Health. Those show that, at a macro-level, there has undoubtedly been an increase in the number of patients treated over and above the extra resources made available to the NHS since 1990 and before.

Where the hon. Lady and I might agree is—

Ms Hodge

Will the hon. Gentleman give way?

Mr. Mans

May I finish my first answer?

I believe that, as we get further into the reforms, we should have more detailed information at district authority level, so that we can see which authorities are doing things more efficiently and treating more patients satisfactorily, and where lessons can be learned across the country.

Ms Hodge

The point about the statistics kept is that they relate to patients treated in hospitals. They have nothing to do with the efficacy and efficiency of GP fundholders in providing services for their patients, especially in comparison with non-GP fundholders.

Mr. Mans

If the hon. Lady will bear with me, I shall deal more specifically with fundholders and non-fundholders later. I was trying to make the overall point that I would like more detailed information to be available at district level across the board, as is available at national level, so that we could see what I believe to be true, and what the apocryphal evidence in my constituency supports—that people are being treated more quickly and are more satisfied with the health service now than they were a few years ago.

What partly explains the extra number of patients being treated is the fact that our reforms have empowered people throughout the NHS to make decisions for patients and to take responsibility for those decisions. Decisions can no longer be blamed on someone else in a location remote from where patients are treated. Trusts are responsible locally, and health authorities are more responsible too, because they have the resources in their budgets. GP fundholders are also responsible, because they too have funds.

As for the so-called two-tier system, the image offered by the Labour party is that before the reforms there was a single-tier system. Everybody who has used the health service knows perfectly well that that was never the case. We had what one could depict as a multi-tier, opaque system. People did not know whether they were waiting longer than other people down the road or in the next county. They did not know what was going on at all.

Waiting time may have depended on who one's GP was, and who he trained with, or whether he knew a particular consultant in a certain part of the country to whom he could refer one. The idea that the reforms have created a tiered system of health treatment that did not exist before is utter rubbish.

Mr. Timms

The tone of Conservative Members' comments on the two-tier system now seems different from what we have heard in the past. Does the hon. Gentleman accept that there is now a two-tier system in general practice?

Mr. Mans

If the hon. Gentleman will bear with me a little longer, I am trying to explain what I believe the position to be today. I am pleased that Opposition Members agree that we did not have equality of access or a single-tier system before the reforms, but an opaque system, in which nobody even knew whether they were waiting longer or shorter times, or when they would get treatment.

I shall now give what many people might describe as a petty example of how the GP fundholding principle is improving health care. It is petty in that it does not involve health care. Right at the beginning of the reforms, a story was repeated many times; I do not know how true it is, although I suspect that there is an element of truth in it.

Apparently, a fundholding practice negotiated a contract with its local hospital stipulating that any of its patients who had to wait more than 20 minutes to be seen by a consultant had to be given a cup of tea. That is precisely what happened. I do not know exactly how it happened, but I imagine a lady going down the line of people waiting to see the consultant and asking, "Are you from Dr. Smith's practice?" Those who were, got the tea, and those who were not did not. [Interruption.] Opposition Members may laugh, but there is a serious point here.

What happened next? There was an outcry and the hospital simply said, "That GP fundholding practice asked for that, so we gave it to them. The health authority has only to ask for the same and it will get it too." As a result, I have no doubt that in that hospital everybody gets a cup of tea.

Opposition Members may think that that is a ridiculous story, but that "silly little example"—it could be depicted as such—shows that, as a result of fundholding, there was a levelling-up process. That point has been more seriously and authoritatively put by Professor Glennester, in the book that I cited in an earlier intervention: To argue for the abolition of fund-holding on this ground [two-tier service] is … perverse. It is akin to the philosophical paradox that equality in human needs can best be achieved by starving everyone. Equality is best pursued by seeking to maximise opportunities, not to minimise them—levelling up not down". To me, 'that is the main argument in favour of keeping fundholding practices. The examples that the hon. Member for Wakefield gave a few minutes ago, concerning many of his constituents who, he submits, were denied treatment, give the wrong impression, because the hon. Gentleman assumes that they were denied treatment simply because of the existence of fundholders. They were not. Without fundholders, there would not be that so-called "spare cash" in the budgets that the hon. Gentleman mentioned and those patients would not have been treated any sooner. The existence of fundholders makes no difference to the time it takes to treat patients of non-fundholding GPs.

Ms Church

There are a number of points on which I am in agreement with the hon. Gentleman. The Opposition support a levelling-up process, but where is the evidence of that levelling up? No study has been done on whether fundholding is making any contribution to reducing inequalities in the health service. Are the Government ashamed to carry out a study? Do the Government not believe that a study would prove that the system is so good?

Mr. Mans

I shall not dwell on that point, although I do agree with the hon. Lady up to a point. I know that some studies have been done, and I hope that others will follow to prove my point.

Mr. Malone

I am grateful to my hon. Friend for allowing me in a sense to intervene on the intervention of the hon. Member for Dagenham (Ms Church). I say to him and to her that I shall be dealing with the issue of evaluation thoroughly in my winding-up speech. I take my hon. Friend's point, but I am sure that he agrees that the formation of unified health authorities as from 1 April next year gives us an opportunity to look at how the reforms are operating on a district level.

Mr. Mans

I am pleased that my hon. Friend will deal with that matter in his winding-up speech. There is a fair amount of information on the success of fundholders.

It is worth making the point that, in 1990, the Labour party was convinced that fundholders would fail. The hon. Member for Peckham (Ms Harman) predicted that the patients of fundholders would suffer because of the limits on fundholders' budgets. Labour cannot have it both ways. It criticised the initiative in the first place because it said that fundholders' patients would suffer. It is now criticising the system because fundholders are clearly succeeding. Labour is now arguing that people who are not the patients of fundholders are suffering as a result of that success. I have stated that that is not true, because there has been a levelling-up process.

Opposition Members have suggested that health commissions were the way forward. That is interesting, as those locally initiated health commissions—which I commend—have been set up as a result of the spur that they received from GP fundholders. A group of doctors have got together in my area, and my hon. Friend the Minister went to see them when he was up at the party conference. That group would never have got together had it not been for the fact that GP fundholders existed.

We constantly hear from the Labour party—we have heard many more examples this morning—examples of patients who have not been treated because they were not members of GP fundholding practices. Labour suggests that that is the fault of the GP fundholders, but it must address its remarks to the local health authorities. Labour must ask the authorities how they cannot stretch what are effectively the same resources as far as GP fundholding practices do.

The fact that GP fundholders have money left at the end of the financial year—and certainly two thirds of the way through the year—is an example of how resources can be used efficiently. Health authorities can learn from the experience of fundholders, and can treat more of their patients the following year within their budget.

Mr. McLeish

The hon. Gentleman is making a thoughtful speech. I wish to tackle the issue of evaluation, although I know that the Minister has stated that he will deal with it when he winds up. The much-quoted Howard Glennester submitted a paper to a market research seminar in March 1995, which looked at the impact of GP fundholding from various points of view. On equity, Professor Glennester said that the data were of such poor quality that he could not make a judgment. On efficiency, he said that the details were unknown, while there was not enough information to judge the effect on the quality of care.

Mr. Malone

So why is the hon. Gentleman making a judgment?

Mr. McLeish

The Minister asks why I am making a judgment in that case. Extravagant claims are being made—not by the hon. Member for Wyre (Mr. Mans), but by Ministers—about the benefits of GP fundholding. Why do the Government not set up proper evaluation techniques with proper methodologies to look at both GP fundholding and non-fundholding? What do the Government have to hide? I am sorry that my comments are addressed not to the hon. Member for Wyre, but to the Minister.

Mr. Mans

The hon. Gentleman must wait for my hon. Friend the Minister to answer his questions at the end of the debate. I have been surprised at the tone of some of the interventions, because an Opposition Member—it may have been the hon. Member for Fife, Central (Mr. McLeish)—said earlier that we must "build upon the best". Implicit in that is the belief that the patients of fundholders seem to be getting a better service. Is the hon. Gentleman assuming that some of the best techniques available are being pioneered by GP fundholders?

Mr. McLeish

Building on the best implies that we can have best practice in developments in non-GP fundholding, as well as in fundholding. We are looking for a level playing field. Building on the best should not mean the particularisation of the benefits flowing from GP fundholding to the exclusion of the other 50 per cent. of patients who are served by some form of health authority, GP-commissioning framework.

Mr. Mans

I agree with that point, as we must obviously build upon the best—wherever it is. It is clear from Opposition Members' remarks that GP fundholding is working in the sense that the patients of those fundholders seem to be getting treatment sooner than other patients. That shows that some of the best practice is available in GP fundholders' practices as a result of them holding their own budgets. That is the key to the discussion.

If we take away GP fundholders' empowerment and their ability to make decisions and live with the financial implications, we shall reduce the amount of innovation and we shall find that the best practice is levelled down on the altar of equality of access. As a result, fewer patients will be treated in an attempt to make certain that there is more equality of access for those who are not the patients of fundholding practices.

We have dwelt long enough on that point; I shall make a couple of other points before I finish. We hear a great deal from Labour about the amounts spent on administration. As far as I can understand, the Opposition want to spend more money on evaluating the results of the reforms. In no way can that money be directly related to patient care—an argument normally put forward by Opposition Members when money is spent on information technology or computers.

I believe that good use is made of NHS money. Services are moved forward. For example, information technology is used dramatically more nowadays than five years ago. It is surely odd that many Labour Members decry that use of NHS money, yet suggest that we should use IT increasingly in schools and elsewhere. If we are to have a modern health service, we must embrace IT. We must employ people to collect all the data that Labour Members want to ensure that the health service is more efficient.

Labour Members cannot have it both ways. If they accept, as the hon. Member for Dagenham (Ms Church) is by nodding her head, that that is not possible, I hope that she and others will not complain in future about the moneys that have not been spent on patient care.

Ms Church

We are not concerned if money is spent on proper and systematic research into the effect of the huge changes that were introduced in one fell swoop throughout England without pilot studies being undertaken. Of course there should have been—[Interruption.] I would ask the Minister and other Conservative Members to allow me to continue. It is—[Interruption.]—

Madam Deputy Speaker (Dame Janet Fookes)

Order. There is a recurrence of seated commentaries and interventions. From whichever side of the Chamber they come, I deprecate them.

Ms Church

The changes to which I was referring were introduced by the Government throughout England without any pilot studies being undertaken. There was no proper opportunity to monitor the progress of the changes, to ensure that the system would work and would meet the Government's objectives. The Government's approach was not scientific and was managerially wrong. Indeed, it was incompetent.

Now, in the run-up to the general election, the Government have decided that they want to spend some money to ensure that it is "proved" that their system has worked. Of course, we—

Madam Deputy Speaker

Order. The hon. Lady's intervention is much too long.

Mr. Mans

I shall try to answer some of the questions that the hon. Lady posed. First, as I understand it, there were pilot studies of GP fundholding. Secondly, as I understand it—[Interruption.] I hope that the hon. Lady will listen to the answer or answers that I am trying to give her. As I have said, there were pilot studies of GP fundholding before the scheme was introduced. I think that I am right in saying that a fair amount of evidence was compiled before the purchaser-provider split and trusts were introduced in 1991.

It could be argued that GP fundholding was introduced voluntarily and thus was an evolutionary process. Only a practice that felt that it could cope with the burden of fundholding was allowed to go ahead. Experiments took place that built on what had gone before. As a result, we have a system that is being reformed as it proceeds. I believe that it is highly successful.

Fundholders have been much more successful than was anticipated. I have been surprised by the innovations and new ideas that have flowed from the ability of doctors to decide that they want to do something on behalf of their patients and then to act because they have the necessary financial resources. Labour Members tell doctors that they want them to have new ideas, but at the same time they say, "You won't have any money to implement them." They want to give authority to others, to those who are further away from the problems that GPs are trying to overcome and less knowledgeable about them.

Much has been said about bureaucrats, managers and administrators in the health service. We spend too much time studying inputs, and more time should be spent examining the number of patients treated. There has been an awful lot of comment in the Chamber about having too many administrators and bureaucrats. It is right that we should ensure that there are not people in the health service who carry out work that is not absolutely necessary. However, we should not cut arbitrarily the number of administrators or bureaucrats; we have to relate such cuts to the effect that they would have on the number of patients treated.

I am not desperately worried about the ratio of doctors and nurses to other people working in the health service. What is important is that, whatever the ratio in a particular area may be, it maximises the amount of patient care that is possible.

Mr. Rendel

The hon. Gentleman may have failed to recognise that the Secretary of State announced in Blackpool just such an arbitrary cut in bureaucrats.

Mr. Mans

The hon. Gentleman does me a disservice. I most certainly heard what my right hon. Friend the Secretary of State said. The Secretary of State made the specific point that he wanted that cut to increase the number of patients treated. My point is that we should not consider administrators in isolation and say that the fact that their numbers happen to have gone up at a certain time demonstrates how inefficiently the health service is operating.

To take one example, many GP practices, fundholding and non-fundholding, have practice managers. I strongly advocate that as a good move. The number of administrators will have increased as a result of that move, but the number of patients being properly treated will probably have gone up as well, because GPs will be able to devote more time to treating patients and less to filling in forms.

In conclusion, I strongly believe that we already have a fair amount of information available at national level to show that the reforms over the past five years have been very successful. More patients have been treated and that cannot be explained only by the extra resources that the Government have put into the health service.

We have to embrace information technology and ensure that medical advances are used increasingly to make certain that we get the maximum benefit from the money provided by the taxpayer for the health service. That process will happen increasingly in the primary rather than secondary care part of the system. The driving force behind innovation and the use of new technology and techniques has been the GP fundholding initiative. I want it to be developed further. I am certain that that points the right way for the health service.

12.37 pm

Mr. David Rendel (Newbury)

I am grateful for the opportunity to speak in this important debate. I have a personal interest, in that my wife is a GP in a practice in Newbury. The House will not be surprised to hear that I am a strong supporter of the pre-eminent place of primary health care in the health service in looking after the health of the nation. There are several reasons for that.

First, prevention is surely better than cure. Primary care is the main arena for preventive medicine. Secondly, and this is a connected point, it is a national health service—I stress the word "health", because we should never forget that that is what it is all about. Primary health care gives the best opportunity to work towards good health promotion.

Thirdly, it is primary care, on the whole, in which patients have the greatest say. Most patients find it easier to talk to their GP than to a hospital specialist, who may talk in a strange and idiosyncratic language and find it more difficult than a GP would to explain to patients the details of what is involved.

Cynics will ask about the Government's real aim in supporting the pre-eminence of primary care in the health service. There is no question that many people would answer that the Government are after cost-cutting yet again. People cannot be blamed for assuming that that is the Government's main aim when one considers what has happened over such issues as care in the community. We have all accepted that care in the community is the right way to go, but we have seen what has happened as it has been introduced.

Although care in the community may be the right policy, it does not work unless it is backed by the right funds. In exactly the same way, making primary care the pre-eminent part of the health service may be the right policy, but it will not and cannot work unless it is supported by the best resources.

Mr. Malone

On care in the community, does the hon. Gentleman agree that, while funds are important, implementing proper practice is also important? In some authorities where the care programme approach has been implemented it works successfully, but in others where it has not been implemented it does not. Although funds are important, they are not the sole explanation of why the policy works well in some areas but not in others.

Mr. Rendel

I should have thought that implementation of the policy would depend heavily on the amount of resources allocated to it, so the two issues interact closely.

In practice, if we move more resources into primary health care, we may save some hospital costs. The danger, however, is that we would do so at the cost of greatly increasing GP work loads if there is no corresponding increase in funds for primary care. Moreover, if we move more effort into the primary care sector, that will lead in some cases to greater need being identified. That is another reason why, if we are to go down that route, we shall need greater resources to manage the greater needs that are then identified. How does that fit in with the Government's hospital closure programme?

Let us examine in more detail how the Government want to move extra resources into primary care. They want to base the move almost entirely on fundholding. I hope that the rest of this debate will not concentrate on fundholding, as it has until now, and that some hon. Members will concentrate instead on primary care.

I do not deny for a moment that fundholding can bring some benefits. In particular, it has tended to teach some GPs about the importance of taking care with regard to drug costs. It is not a question of prescribing less—that would be the wrong way to look at the matter, although that point has been made by some Conservative Members—but of prescribing, where possible, alternative but equally effective drugs which may cost less. That important change has sometimes been brought about by fundholding.

However, that change could have taken place without the introduction of fundholding. Had GPs gone about matters in the right way, and had more pressure been put on them to bring down their prescription costs, that change could have been made without fundholding. Fundholding has, however, pointed the way for some GPs, even non-fundholders, to bring down their drug costs.

Fundholding can help to bring some services closer to patients. Cases have been well advertised in which physiotherapy services, for instance, have been brought into the GPs' surgeries and thus brought closer to the patients who need them.

There are, however, several disadvantages to fundholding and it is important to mention those as well as the advantages if we are to have a clear picture of what is happening.

A constituent of mine had the misfortune, some years ago, to be involved in a car accident in Wales. He hurt his back severely and was out of work as a result of the pain. He was sent to various different hospitals until at last he found a specialist who could deal with his problem. That specialist cured the pain, and my constituent was able to return to work. He then moved into my constituency and, several years later, the pain recurred. Once again, he had to leave his job, at a considerable cost to the community as a whole.

He was by that time with a fundholding practice in my constituency, and he visited his GP and asked to be referred back to the one specialist who he knew had been able to treat the problem in the past. The specialist being in Wales, however, that fundholding GP did not have a contract with him and refused to send the patient back to him. He tried all sorts of other specialists with whom he did have contracts; none of them worked, but he insisted to the patient that those specialists were every bit as good as the man that he had seen in Wales. No doubt that was true, in general terms, but they did not work for that patient.

Those of us who know anything about medicine realise that the psychological effects of visiting a doctor whom one trusts and who one believes can bring about a cure are often extremely important. Only when, after a series of letters from me, the GP was in effect forced to allow the patient to be referred back to the man whom he had seen originally, was the man cured of his pain once again and enabled to return to work, with all the savings that that implied for the taxpayer. That is an example of a way in which fundholding certainly does not work.

I agree with the hon. Member for Newham, North-East (Mr. Timms), who intervened earlier, that there has been an interesting change in the Government's line as to whether fundholding implies a two-tier system. When the Minister was questioned about that earlier, although he attempted to deny it, in practice what he said was not a denial of the idea that there is now a two-tier system. He admitted that, in effect, a two-tier system had been introduced deliberately, but said that it was only in the marginal aspects of medicine and not in the centre.

The Minister went further, saying that there was now and always had been a two-tier system, in that, in different regions, patients receive different levels of service. It is true that that always has been the case, and it is one of the scandals of the health service that that has not been corrected in the past. It should be corrected now, but fundholding does not help the problem.

There is undoubtedly unequal funding of fundholding practices and non-fundholding practices, perhaps especially in information technology equipment. Two years ago, the British Medical Association made proposals to the NHS executive to introduce equity and high standards of computerisation. The executive said that it would respond, but for two years it has failed to do so. Will the Minister tell us today what his response is to that initiative? He must surely want to respond that there will be a levelling up of funds for IT equipment for non-fundholding practices.

Far from being popular with GPs, in practice fundholding is very unpopular, even with most fundholders. It is nonsense to say, that because people take on fundholding duties, it follows that they must like it and prefer it to the old system. As a result of all the extra administration involved, most of the fundholders object to it. I say that from personal experience, because, as I am married to a GP, my wife and I know a great many GPs from both fundholding and non-fundholding practices.

As was briefly mentioned, fundholding has undoubtedly brought about a major increase in emergency admissions—by fundholders because in many cases it is a way of getting their patients treated without it coming off their budgets, and by non-fundholders because it is often the only way they can ensure that their patients are treated. Whatever may have been said by Conservative Members, the evidence clearly shows that the huge increase in emergency admissions must mean that people are either being held back until they are emergencies or going into hospital as emergencies when previously they would not have been counted as such.

There are alternative ways of obtaining the advantages of fundholding. That is what is wrong with the present move towards greater fundholding. Locality purchasing, joint commissioning or whatever one likes to call it, would unquestionably bring about much of the increased command that GPs have over the way in which their funds are used without involving them in the extra administrative burden that they so much abhor.

Locality purchasing is to fundholding what the local management of schools is to the grant-maintained system. It is wrong that the Government refuse to encourage locality purchasing. They are perfectly happy about the local management of schools, and I wish that they would do more to encourage locality purchasing. Do they not do so because the equity of funding combined with locality purchasing would lead not to fundholding being abolished but to its withering on the vine? They do not seem to like that idea. It is unnecessary to make fundholding the basis for a new emphasis on primary care in the NHS. Is it now possible, as I would like, for primary care to take on that expanded role?

There is a huge danger in the desperately low morale of the GP service. We have been told today that morale is no lower than it has ever been. That shows how out of touch some hon. Members are. I have been familiar with the health service scene since I first met my wife in 1969, and I have never seen morale in the health service so low as it is now, particularly among GPs.

There are many signs: recruitment is desperately difficult, especially in many inner cities, the number of applicants per post is falling and some jobs often have to be re-advertised, perhaps more than once. A recent report showed that, in Yorkshire, 78 out of 300 training posts remain empty. In Wales, the figure is 40 out of 80, and in the west of Scotland there are now 27 posts lying empty. In Yorkshire in 1989, there were 30 applicants per vacancy; by 1992, the figure had dropped to just five.

Another sign is the number of GPs who now take early retirement. It is difficult to find a GP who retires later than the earliest moment at which his or her practice agreement allows that to happen. That never used to be true; GPs used to continue into their 70s or even 80s. That was not necessarily a good idea, but it was possible and some GPs were keen to do it. One could not find a GP now who wanted to continue in practice for longer than was absolutely necessary.

What are the reasons for the low morale? Patients are becoming more knowledgeable, which is a good thing, and are therefore becoming more demanding. There is nothing wrong with that, but the GPs' work load is increasing as a result. There are more elderly patients and, as we all know, the elderly are not only ill more often, but their illnesses are often more severe. Patients are discharged from hospital earlier and return to their GP's care at a time when they would previously have remained in hospital.

We must never forget that doctors are not in the job for the money. They do not enter GP work or primary care for the money, but because they want a job which allows them to express their care for other people in the community. As has been, there is a culture change in the NHS, but that change is not welcome to the GPs or to any of the medical staff. They are uncertain about their future and about whether the NHS will survive in anything like its present form. They work desperately long hours.

This important point is not contradicted by list sizes, which have been reduced. As each patient requires more than before, the overall level of work has increased. A survey of west country GPs, which was discussed in the House recently, showed that more than half of them are working more than 64 hours per week and many are working more than 80 hours per week—70 per cent. of them thought that the hours they work are putting their patients at risk. There can be no doubt of that risk when doctors are on duty all through the night and possibly through the next day as well.

Long hours are caused not least by an increase in administration, form-filling and budgeting. In Blackpool, the Secretary of State made a great proclamation that was welcomed widely by his audience. He said that he was cutting the number of forms to be filled in by GPs by 15 million per year. That sounds marvellous until one realises that it means merely that each year each GP will be filling in one form fewer per three patients—a minimal drop in work load.

Finally, there is the huge burden on GPs of the present complaints system. It is cumbersome and lengthy, and leaves GPs in uncertainty for long periods and it is hugely stressful. I have known GPs having to drop out of work for a while because of stress caused by the complaints system. It would be much better for patients and doctors if we could introduce once and for all a no-fault compensation system. The only people who might suffer are the lawyers, who would no longer get the work involved in taking lengthy medical cases through the courts year after year.

In principle, it is right to increase our reliance on primary care, but I have deep concerns about how the Government have chosen to do it. First, they should have resolved the huge problems currently facing primary care, which find their expression in the appallingly low morale of most GPs but which arise from the hugely increased work load for which GPs have been given no increased resources to enable them to cope. Secondly, the Government should not have chosen to rely on the deeply flawed fundholding ideology. Whatever benefits it may have brought, it has undoubtedly led to a divisive two-tier system while destroying the trust between doctor and patient which is such a crucial part of the healing process.

As usual, the Government have succeeded in so mismanaging what started as a good idea that they have lost its entire value. When that happens with something as precious to Britain as our national health service, it is not just a shame—it is a tragedy.

12.56 pm

Mr. Roger Sims (Chislehurst)

I preface my remarks by expressing a welcome to the hon. Member for Fife, Central (Mr. McLeish), albeit in his absence, on his Front-Bench debut. We listened with interest to what he had to say, and the whole House listened with particular sympathy to his account of his personal experience of the health service earlier this year. It cannot have been easy for him to discuss that matter in public. He said that all his constituents should be entitled to the best possible service, and, of course, we all share that wish.

We shall study carefully what the hon. Gentleman said about Labour party policy on fundholding. He made several references to the desirability of common ground, which clearly we would all like to feel that we occupy, but it seems to me that he and his party still do not understand the philosophy behind GP fundholding and certainly he does not understand how it works in practice. I was a little surprised by his criticism of my hon. Friend the Minister for what he described as a partisan approach. If anybody, having started on what appeared to be common ground, finished by being very partisan, it was the hon. Member for Fife, Central.

The subject of our debate is Fundholding in a primary care-led National Health Service". Of course, the NHS is and always has been essentially primary care-led, but it is becoming even more so. Not only is the general practitioner the so-called gatekeeper to services, but increasingly GPs are actually giving treatments which in the past would have been given in hospitals. If they do not actually give the treatment, they may provide accommodation within the practice premises for visiting consultants or, in the case of my own GP, from time to time caravans with specialist facilities have been parked outside for the benefit of patients.

Just as services are coming down the line from the centre to the individual GP, so should finance. Currently, the Department of Health makes grants to regions, which in turn pass money to districts. A district has a global picture of what is required in its area, and so can judge how resources can best be used. As general practitioners have even better knowledge of patients' needs, it is sensible that, if they so wish, they should hold the purse strings. That is surely what fundholding is all about.

We have heard, and will no doubt continue to hear, the inevitable comments about a two-tier service. My hon. Friend the Member for Croydon, North-East (Mr. Congdon) dealt with some of them in his speech. It is evident that, if resources are limited and contracts are made between providers and purchasers, in some circumstances a health authority contract for routine and straightforward operations may be exhausted and patients may have to wait until the next financial year, while GP fundholders may have organised their finances on a different basis and be able to continue to make that provision for their patients. That is bound to happen from time to time, and it would be hard to avoid it.

However, it is possible that the reverse may also be true. GP fundholders may have exhausted their contracts and therefore find themselves unable to arrange routine operations, while non-fundholding doctors, still being directly funded by the health authority, may not have exhausted their contracts and may be able to continue to arrange routine operations. It could be two-tier in both directions.

In fact, there is not much substance to the argument about a two-tier service, because the NHS has actually always been multi-tier. Provision has always depended on the part of the country in which one lives, one's doctor, the local hospital, the differing lengths of waiting lists, and so on. The claim about a two-tier service simply does not stand up.

Mr. Rendel

Can the hon. Gentleman give us examples of fundholding practices that have run out of money while the local health authority has had the money to continue to provide routine operations?

Mr. Sims

I cannot provide examples off the top of my head. I have certainly heard of such examples, but I accept that they are few, probably because GP fundholders know the needs of their patients and thus are better able to organise their finances than health authorities are generally able to do. In the past, everything was haphazard; now fundholders can arrange access to services according to pain and the severity of illness. It is no longer a matter of just adding a name to a waiting list.

Fundholding facilitates the co-ordination of services in the interests of patients rather than consultants; it brings together the budgets for primary, secondary and community care; it makes GPs and consultants aware of costs; it increases the range of services available to patients; it ensures the decentralisation of control and decision-making, and GPs can purchase the best service for their patients.

Whatever the Opposition may say, the fact is that fundholding is working. It is not perfect, because it is still at a relatively early stage, but a number of surveys have proved that it is successful. Several references have been made to lack of research, so I draw hon. Members' attention to an interesting document issued by the Institute of Health Services Management, written by Mr. Donald W. Light and entitled, "The future of fundholding". Mr. Light is an American, who brings an objective view to fundholding.

I advise hon. Members to read the document, which examines fundholding, warts and all. It mentions some of the shortcomings, but states that the advantages enormously outweigh them. We surely need to consider how fundholding is working and proceed with it rather than going back to where we were before, as the Opposition seem inclined to do.

My hon. Friend the Minister said that the scene is still changing, and my right hon. Friend the Secretary of State has said that fundholding as it is at present is not to be the only model. One way forward is the introduction of the three levels of fundholding. The first is the standard level, and it is proposed to reduce the list size necessary to qualify as a fundholding practice. The second is community fundholding, whereby a more limited range of services would be available for fundholders with smaller lists. There is no doubt that that idea is attracting GPs in my constituency who have hitherto been hesitant about becoming fundholders. The third level involves fundholders who are already well into the process and may wish to take advantage of the proposal for total purchasing. The reaction to the pilot scheme suggests that that is likely to be successful.

Of course there are still variations in the extent to which fundholding has been taken up in different parts of the country, and there is concern about suggestions of tension, if not competition, between health authorities and fundholders. That should not and need not be the case.

I was also rather worried to hear what the hon. Member for Wakefield (Mr. Hinchliffe) was telling us about non-fundholders who reached the stage where they found it necessary to write a joint letter to the health authority. That seems to show a regrettable lack of co-operation, co-ordination and communication between the non-fundholding doctors and the health authority. I am not sure where the fault lies.

I should like to draw the House's attention to what is happening in Bromley, where a number of general practitioners—fundholding and non-fundholding—have been appointed to the health authority as clinical commissioning directors. Perhaps the House will allow me to quote from the document to which I referred and which states how that works—or rather, how it is intended to work as it is still in its early stages. It states: The Bromley experiment, called Clinical Commissioning to indicate that creative purchasing will be done for everyone in the Bromley area, consists of appointing GPs (including fundholders) from sub-areas called 'locality patches,' as clinical commissioning directors. They will be paid for a session a week at BMA consultant rates to serve on a clinical commissioning board. They will go through a training programme, learn about overall commissioning and then decide how best to commission services and allocate funds. They will present the views of their part of the GP community and interact with them through a network of peer groups to learn their priorities, and to inform them about deliberation. At the moment, the scope is hospital and community health services, but general medical services could be and may be added. The aim of the Board is to reach consensus about decisions, but the Chief Executive has ultimate responsibility and thus makes final decisions. The advantage of clinical commissioning is that it puts GPs, fundholders or otherwise, at the very heart of commissioning and gives them a say in the decisions. It means that they can work together, instead of being in conflict. Indeed, Claire Perry, the chief executive of Bromley health authority, said: GPs are the best group to do overall commissioning because they have the best feel for local residents and can communicate best with consultants. There are clear benefits from clinical commissioning, especially for patients. Clinical commissioning gives GPs more involvement, which means better quality services for the patients and better use of NHS resources. It is an opportunity for GPs to involve themselves in a new role which brings them right to the heart of the commissioning process. It also shares power—that is part of the object of the operation. Bromley health authority wants a real partnership with GPs and wants to actively involve them. It is an effective model, because it mobilises practice-based evidence to help us tackle the issues of service effectiveness and providers.

It seems that clinical commissioning is a logical development from fundholding. Indeed, it is likely, as more GPs become involved in it, that those who are not already fundholders may be attracted to fundholding status.

I welcome this debate as an opportunity to demonstrate the advantages of fundholding, to discuss how it can develop, and also—perhaps—to educate the Labour party in the developments. The right hon. Member for Derby, South (Mrs. Beckett), in one of her last statements as the shadow Secretary of State for Health, said that she recognised the advances that fundholding has brought to many patients. Surely we all do, and we all want all our constituents to benefit from those advances. That, at least, is common ground.

1.10 pm

Ms Margaret Hodge (Barking)

I want first to deal with some general points, and then turn specifically to the position in my constituency.

A number of Conservative Members have made the point that the reforms in relation to general practitioners with the introduction of fundholding were something to do with levelling up. It is strange to hear that Conservative Members and the Government are in any way interested in levelling up the health service. Their record is all one of levelling it down and of a lack of confidence and trust in their ability to run a national health service.

More importantly, we do not, as the hon. Member for Wyre (Mr. Mans) suggested, level up by institutionalising inequality. All of us want to level up and improve the quality of health care in this nation, but we must do that hand in hand with ensuring equality of access. One of the strongest criticisms that Labour Members make of the introduction of GP fundholding is that it has institutionalised yet further inequality by bringing about a two-tier system.

We have been told that there has always been inequality; that we have always had a two-tier system. Indeed, there have always been inequalities in health care, but the purpose and role of any responsible Government must be to tackle those inequalities and disparities of access, not, by a deliberate act of Government policy, to further it and deliberately to strengthen it. The role of a responsible Government must be to introduce policies that lessen the differences, not heighten them. Labour Members' second general criticism of the Government is that they are heightening the differences through the way in which they have introduced the reform.

I am all for introducing and strengthening the role of general practitioners in commissioning health care—of course it makes sense. Our attack is on the way in which that has been done: partly to the exclusion of other interested parties in the commissioning process, but especially by introducing a two-tier service which disadvantages far too many people in Britain today.

Mr. Merchant

Is the hon. Lady saying, therefore, that, if all GP practices became fundholders, she would be happy?

Ms Hodge

I am saying that I would like us to revise, as we propose, the way in which we commission health care, so that we involve not only GPs, but others who work in the primary care service—health visitors, midwives, district nurses and local authorities, which have a role in care in the community. I would like a system that strengthens that involvement in the purchase of health care. I do not believe that the way forward is through the current structure of GP fundholding; there are other mechanisms.

As part of the general thrust of our argument about primary care and GP fundholders, I make this point. I have with me some research that was carried out by York university on the allocation of resources. If the Government want to bring equity into the system, they must deal with the allocation of resources. The most recent research by York university on the North Thames region shows that the gainers have been areas that have the least need for additional health resources. North Essex has gained almost £23 million in capitation. At the bottom of the table, the East London and the City health authority and my authority have lost more than £23 million in health resources. If we want equity and equality of access to health care, we must shift resources to the areas that have the highest levels of deprivation. That is not what the Government are doing. Their policy institutionalises and increases inequality.

Mr. Malone

Is the hon. Lady suggesting that the formula for allocating resources for patients on an equitable basis, which has been informed by the York study and which has been refined so that it makes the allocation more responsive to local need, is defective compared with her ex-cathedra statements? She is embarking on dangerous ground if she pitches out the formula, which we have refined for some time and which, until now, has been common ground. If she wants her simple observations to replace it, we are in for an interesting time.

Ms Hodge

I simply make the observation that if, under the formula, a district with one of the sickest populations loses a further £14 million, it would appear to be common sense further to refine that formula. I hope that when the Minister looks at the statistics, he will take a similar view.

I am enormously concerned about the health service in general in Barking, and especially about GP services. I shall examine GP fundholding services in terms of what they are doing for GP primary care services in my constituency. I have said in previous health debates that I believe that east London is one of the areas whose health needs, and therefore health services, have been ignored for too long, even in the context of the health needs of the capital.

People in east London do not shout as loudly as those in other parts in London, as has been shown by the appalling closure proposals for Bart's and Guy's. In east London, we have lost an enormous number of hospitals. There is no longer a hospital in my constituency; there is no hospital in the borough. Many of my constituents have to travel 10 to 12 miles to attend a hospital. Public transport facilities are poor, and most people are too poor to afford a taxi. Almost half of my constituents—40 per cent.—have no access to a car. In the context of that absurd hospital closure programme, which clearly did not take into account the health needs of the people in my constituency, it is critical that there should be good access to high-quality primary care facilities if those people are to enjoy equality of access to a national health service.

Yet in my constituency the premises of many practices are of very poor quality. The quality of the practitioners themselves is often worrying, too, and, as the chair of the FHSA has said to me several times, the authority's ability to recruit high-quality practitioners is limited.

The people who live in Barking are the most in need, yet in my part of east London they are the ones furthest from a hospital. In my constituency I have the highest concentration of children under five, the highest concentration of the homeless and the highest concentration of elderly people, yet we are the furthest from a hospital.

Despite the distance from a hospital, we have a problem with poor primary health care. The statistics produced for "The Health of the Nation" are worse for Barking than elsewhere. For example, the instance of coronary heart disease is way above the national average, as is the rate of conception among under-16s. The rate of accidents to girls under 15 is three times the national average.

With that background, what are our primary health care facilities? The most recent data give a shocking picture: 81 per cent. of the premises that are supposed to provide the facilities that can no longer be provided by hospitals were classified as poor. Not one surgery in Barking was classified in the best category. In other parts of London where there are areas of deprivation—Lambeth, Lewisham or Southwark, for example—50 per cent. of surgeries were classified as poor. Yet in Barking the figure was 81 per cent.

Who are the GPs in Barking? There is a strong concentration of single-person practices, and many of the GPs are elderly. One in five is likely to retire in the next few years, and the FHSA will have an enormous task to replace them. When it advertises for GPs, the response rate is extremely poor.

Our premises are poor, we have an elderly cohort of GPs, and we have more GPs dealing with patient lists above the national average. The average patient list in my constituency is 2,175 per GP, and more than one in four practices in Barking have patient lists of more than 2,500. Those are large lists for single-person practices working in poor premises. Only 8 per cent. of GPs in England work in practices with patient lists of more than 2,500.

Other aspects of the profile of general practitioners in Barking are worrying, too. We have fewer women doctors than the national average. The number of support staff working in primary care is lower than the national average. One in 10 of the GPs in Barking has no practice nurse. There are hardly any training facilities in my constituency, and many of the GPs working there have to go as far as Basildon for their in-service training. In the entire district health authority and FHSA area, we would need as many as 30 additional GPs simply to reach the national average in relation to the ratio of patients per GP.

In that context, individual fundholding is irrelevant to the needs of my constituency. More money going towards administration costs does not help. I understand from the answer to a question by my hon. Friend the Member for Darlington (Mr. Milburn) that the public subsidy towards management and computer costs in the NHS works out at £201.1 million. I would rather that that money was spent on recruiting more quality GPs for my constituency and improving the premises in which they have to operate to enable them to provide a better service to my constituents. I want money to go to premises, training and providing incentive payments to attract high-calibre GPs to east London. That money could be spent on the support staff necessary to provide a high-quality primary health care service in east London.

I wish to draw the attention of the House to some cases from my constituency. As a relatively new Member of the House, I have been astonished to note the number of people coming to my surgery each week with valid complaints about the quality of health care that they have received. What has shocked me is that, in barely a year as a Member of Parliament, I have had four cases in which people have died and in which, on the face of it, the death could have been avoided had there been an effective health service operating in my part of London. Two of the cases relate to the quality of service provided by GPs.

One case involved a young girl in her early 20s who had pains in her left leg. She visited her GP, and was referred to a hospital where she was placed on a waiting list for an arthroscopy. While she was waiting for that appointment, the pain became worse and she returned to her GP, who had no further advice for her.

On Christmas eve last year, the GP visited her home, and her father recalls that the consultation lasted for about one and a half minutes. The GP did not examine her knee, but did prescribe some mild painkillers. Her condition got worse during the Christmas and new year period, and her father tried to get the GP—a sole practitioner—to visit. He would not, and her father was unable to get an urgent appointment with a GP. On 24 January this year, the young girl collapsed and became unconscious. Her father rang the GP, who could not send a doctor. Soon after, Maria died in her father's arms.

Obviously, the family are pursuing the case through the appropriate processes, but I hope that there will be an inquest into my constituent's death. Maria was taking a pill that we have since learnt is one likely to cause a blood clot. It seems to me as a lay person that, with better-quality care from her GP, her death could have been avoided. I am deeply concerned that the Government's policies are not raising the quality of primary health care. Instead, they are motivated by Conservative dogma that the only way to improve anything is to try to introduce a phoney market.

The other case to which I draw the attention of the House involved a young man—he was 32—who had a wife and children. He first fell ill in May 1994. His GP prescribed antibiotics. Later in 1994, he was given more medicine because he had a stomach upset. He continued to feel ill and went to see his GP, who told him to see a psychiatrist. He managed eventually to see a specialist at King George's hospital. Within two days, he was diagnosed as having cancer. He died within days. That tragic episode is being investigated by the relevant committee. It demonstrates to me that there was poor practice at the first port of call for anyone who is in need of help from the health service.

The family health services authority in my constituency is doing its best to tackle what I consider to be inadequate primary health care facilities in the area. It is trying to work with the Government's irrelevant policies. I commend the authority because I think that it works imaginatively with the reforms. It is not in the business of establishing a GP market. Instead, it is using and manipulating fundholding and producing an example of how we can strengthen the capacity of GPs.

The FHSA has set up a multi-fund that brings together 34 GPs in 22 practices. It has probably added to the number of fundholders in the Minister's statistics. The authority does not think that fundholding is a good thing, but it is using the system to improve the capacity of GPs in my constituency and to provide them with direct support.

Thirteen of the 34 GPs represent single-handed practices and seven double-handed practices. The FHSA has found a way of collectivising commissioning within my patch. It is not a way of creating greater division, nor is it a way of introducing the market. Through the collective strength that is supported by the FHSA, we shall improve somewhat the quality of patient care.

It was absurd that Barking hospital was closed when my constituency was represented by the late Jo Richardson. She fought the closure vigorously. It is a scandalous story of a building, much of which was put up in the 1970s but some in the mid-1980s, and most of which is now empty.

A physiotherapy clinic was located there and the multi-fund GP fundholders have used that physiotherapy clinic to good advantage. The physiotherapy clinic was funded, in the complex health world in which we now live, by Redbridge Healthcare NHS trust, which runs King George hospital. The trust does not want the clinic. It has no interest in the well-being of people in Barking; it is concerned with people who live in Redbridge. The trust wanted to close the clinic and has given notice that it intends to do so.

However, now another health authority—Barking and Havering—through its purchasing and the GPs, through fundholding, will ensure that another lot of people are imported to retain the facility. X-ray equipment is going to be removed to one hospital from Barking hospital, while X-ray equipment is imported from another hospital to Barking hospital. How that makes sense, or demonstrates an effective and efficient use of resources, I am left to wonder. However, because the GP fundholders worked collectively—rather than individually—in a multi-fund concept, we have managed to retain a facility that is of benefit to my constituents.

The truth is that GP fundholding is not the answer for the people of Barking. It is typical of much of the Government's policy on the public services that if they cannot manage something efficiently they cop out and pass the buck to somebody else. The really difficult but important task is getting to grips with managing our resources more effectively so that we can improve the quality of the health service that we offer to all, not just to some.

My part of east London has been badly served by the Government's health reforms. Too many hospitals have closed; too little money has been invested in primary health care; and too little attention has been given to the real problems that face primary health care services in our part of London. We must improve the facilities; ensure that we provide the proper pay and incentives to attract high-calibre GPs to work in the poor areas of an urban capital such as London; and ensure that there are sufficient resources for the support services.

I will end with this story. I spend a lot of time in my constituency, which has many old people, going around the luncheon clubs that are provided by the local authority. I talk to those old people about the health service, which is clearly of huge concern to them as they reach the age where they will require the services of a high-quality health service.

I was shocked the other week to be in a luncheon club where we discussing the imminent closure of the accident and emergency unit at Oldchurch hospital. One woman told me, "I have given up. I don't bother any longer to go and see either my doctor or the hospital because it is too far away and I can't get there." I do not know what that will mean for that woman, but I know that if—when—there is a change of Government and we take control of the Department of Health and try to reinstate a truly national health service, we will ensure that the real problems facing real people in ordinary communities are tackled and stop the absurdity of dogma dominating how we run our health service.

1.39 pm

Mr. Piers Merchant (Beckenham)

We have heard a great deal today from Opposition Members about equality of access and equity, but that issue is not the preserve of the Opposition. I believe in it just as strongly as Opposition Members do. I listened to the examples given by the hon. Member for Barking (Ms Hodge) and I sympathise with her and her constituents in wanting the best possible care at primary and other levels of the health service. The question is: how will that be brought about? I make no apology for saying that I believe strongly in the concept of GP fundholding. By extending that system by one mechanism or another to all GPs, we shall achieve exactly what the hon. Lady wishes.

There is an innate contradiction in the position adopted by many Opposition Members. They talk about a two-tier system, which implies that GP fundholders can offer their patients a better service—that may be true, and I believe that it is—yet when they are given an opportunity to extend that better form of treatment and administration to the whole sector, they back away and say that they want something else. I am a little uncertain about exactly what they want. They seem to accept that GPs should play a greater role in determining administrative matters at that level and in decision making, but they seem to want it by putting GPs on committees where they will spend their time arguing about decisions rather than doing what they should do, which is looking after patients. I hope to illustrate in a moment exactly how GP fundholding enables GPs to do that.

At the risk of sickening my hon. Friend the Minister, I refer to a GP practice in my constituency to which I referred earlier this week in Health questions, because it is a good example of how the system works. It is a long-established GP fundholding surgery, which has had time to settle in and develop exactly what the system can develop.

Since its establishment, Elm House surgery has been able to develop incredibly the service that it offers to its patients. I have been round the surgery a number of times and have seen it develop. It now offers an operating theatre for minor operations; its own purpose-built out patients consultancy room; its own nursing staff; and full administrative support. But GPs do not spend their time writing out records or calculating finances; they have been further freed to look after their patients. Nevertheless, because the decisions and administration take place on their premises, they can exercise an overview of them at all times, and can control and determine the direction in which their practice develops.

What really matters, however, is what the patients think. The patients are my constituents and I know many of them well. I have talked to them about the change in GP services that that fundholding practice has brought about, and they are absolutely delighted. They think that it is wonderful. Members of the public can be excused for not appreciating, understanding or knowing the intricacies of many aspects of the health reforms. After all, the average member of the public could be excused for not really understanding or being interested in the concept of providing and purchasing, with which we are well acquainted and which has achieved a great deal. They want good medical care from hospitals, but are not particularly bothered about how it comes about.

GP fundholding practices, however, are different because members of the public understand the concept and appreciate it. When they go to their GPs in those practices, they see that they are being offered a much wider range of services, which they really appreciate. Above all, people can often avoid joining a waiting list to go to the strange environment of a hospital, and can thus avoid the tensions and stresses that many people feel when they go to hospital for the first time or on a rare occasion. All that can be obviated, in many cases, because the GPs are now able to provide a service on the premises, under the supervision of the familiar face of the GP.

Ask any member of the public whom they prefer to visit if they have a medical problem. It is their GP, the person they know and have personal contact with—not a remote consultant, not a person in a hospital that they may never have visited before. All that can be provided by a fundholder.

That additional facility to see a consultant, if necessary, on the premises, is good, not only for the patient, but for the consultant and the GP. If a patient visits the consultant on the GP's premises and there is a problem, or the consultant wants further information or wants to tell the GP something, what does he do? He need not start some administrative process to write a letter, go to a hospital secretariat and go through all the complications of the administration. He simply goes up the stairs or along the corridor, knocks on the door and speaks to the GP who is sitting there. It is direct personal communication and contact—what medicine was originally about. We have gone back to a fundamental that is a very good fundamental.

Those are the significant benefits that patients receive from fundholding practices, and that is why those practices are so popular. They can blend in the operations there with some of the modern developments in medicine, such as day care surgery and evidence-based medicine. All those benefits of innovation, new technology and so on can blend in efficiently and effectively with GP fundholding practices.

In many areas, fundholders have expanded greatly the services that they provide. I shall not detain the House by listing all those services, but I can mention some. In addition to the procedures and minor operations that I mentioned, often fundholding practices can buy expensive heart and other equipment to monitor patients, to carry out diagnostic work, and to carry out glaucoma testing, even endoscopy, and in some cases X-ray services. All those can be provided on the premises.

I therefore believe that GP fundholding is a tremendous innovation. First, it is, above all, patient-driven. It depends on what is best for the patient and frees GPs to concentrate on the clinical side, but leaves them with administrative power. Secondly, it is driven by clinicians, not managers; by GPs, not remote administrators. Thirdly, it is driven by the clinicians who are closest to the patient—GPs—so it is primary-driven, and it is a devolvement of power, a decentralisation, down to local level.

Not only is GP fundholding achieving tremendous developments in fundholding practices, but it has a knock-on effect elsewhere because other GPs who are not fundholders see what can be done, and copy. It strengthens GP practices tremendously by providing a more comprehensive system of primary care and it is entirely possible for fundholding practices to work, as they do, in conjunction with local authorities and voluntary organisations—which the hon. Member for Barking suggested was important. I agree, and fundholders can do and are doing that.

GP fundholding also achieves improvements in hospitals because of the influence that GP fundholders have, not only as GPs, but as people who hold cash. The benefits are extremely wide.

Anxiety has been expressed that GPs who are not fundholders do not benefit. In my health area of Bromley, the health authority, Bromley Health, responding to the growth of popularity of fundholding, has felt obliged to tackle the problem of other GPs. That is quite right; there is no reason why that should not happen. I commend the authority for it. As a result, it has involved GPs in a system of commissioning throughout the area. I am keen that that should not in any sense erode or replace fundholding but, running alongside it, it shows the impact that fundholding has on the rest of the sector and that it innovates, generates ideas and forces new thinking, all to patients' benefit.

I am concerned about the spread of fundholding, which is uneven. The figures for the South Thames area on 1 April 1995 show that, in the Bromley health district, only 18 per cent. of the population is covered by fundholding, compared with 41 per cent. across the region. I am keen for that imbalance to be redressed. It is already being redressed to an extent, as the number of applications this year has greatly increased, and, from 1 April next year, the level will be much higher. I believe that, in the Bromley area, the figure will approach 40 per cent. In my constituency the figure will rise to about one third, which is an improvement, but still below the national average. I am keen that my constituents should not lose through being left behind. I urge my hon. Friend the Minister to help to solve the problem and to find ways of encouraging GPs who have felt inhibited from becoming fundholders to achieve that end.

The principal reason for the low percentage rate in my area is probably the large number of single practitioners. My constituency shares an historic problem with that of the hon. Member for Barking in that my constituency contains areas that are less well off than other parts. The less well-off districts tend, for historical reasons, to have single practitioners. I should like to see encouragement for the development of multi-funds, where single practitioners can get together, become fundholders and, perhaps, use common premises. My hon. Friend the Minister has visited Beckenham hospital in my constituency. It offers GPs, acting together as multi-fundholders, an ideal base in which to locate some of the enhanced practices that I described earlier. I should like that policy to be encouraged.

The benefits of fundholding are overwhelming. I do not want a two-tier system; I want everyone to benefit from the advantages that have flowed from fundholding. I predict that the Labour party will recognise the benefits of that policy. As with so many other policies, it is only a matter of time before the Labour party becomes convinced that the initiative is successful, exciting and, above all, popular. It will then perform one of its now characteristic 180-degree ' turns and, instead of condemning the policy, support it. I hope that the Labour party does that—I believe that it will, for the simple reason that the policy works.

1.52 pm

Mr. Michael Stephen (Shoreham)

I am sure that the House will have been distressed to hear of the deaths of the two constituents mentioned by the hon. Member for Barking (Ms Hodge), but she must realise that the cases involved clinical judgment, or the lack of it, on the part of the doctors involved. Those issues will be investigated, and the hon. Lady has already told the House that the family is pursuing the avenues open to it.

The transformation of the national health service into a primary care-led service is one of the best of the many excellent reforms introduced by Conservative Governments since 1979. We now have a system that is driven by the requirements of general practitioners—by the requirements of those who are closest to the patients and who best understand their needs.

Before the reforms, in so far as the national health service was led at all, it was led by the union bosses. Only last week, I spoke to a lady who is now retired, who was a ward sister during the last Labour Government. She said that almost nothing could be done in her hospital without the shop stewards' approval. In those days, morale was at rock bottom. I am amazed that Opposition Members have the nerve to compare morale in the national health service today with the state of morale in those days, particularly in the winter of 1978–79, when cancer patients were ot allowed into hospitals because the gates were being picketed.

Before we introduced our reforms, many doctors did not know and did not care how much anything cost. Their approach was, "It is our business to heal the sick; it is your problem to worry about the money." That was an irresponsible attitude, because doctors know as well as we do that resources for the national health service are not unlimited, and the service has to be cost-effective.

There never has been and never will be enough money to meet every need in the health service. It is perverse that the more money we put in, the greater the demand we create. There were no waiting lists for kidney transplants 10 years ago, simply because it was not possible to carry out a kidney transplant. Now that it is possible, there are waiting lists for that and many other wonderful procedures that are now available because of the money that the Conservative Government and their predecessors put into the national health service.

The Labour party makes a great deal of fuss about the number of administrators employed in the national health service. In the old days, many doctors and nurses were employed in administrative capacities. They appeared on the records as doctors and nurses, not administrators. We have taken the sensible decision that it is better for administration to be carried out by administrators and not by doctors or nurses who may or may not be good at it.

The patients charter has been a great success and has improved the quality of service to patients. It is the mission statement of the national health service. It makes it clear to those in the service what is expected of them, and it makes it clear to the public what they can expect, but it is not a guarantee that the requirements of the charter will be met tomorrow. It is a long-term objective, a mission statement—something that we must all work towards—and we have made great progress towards meeting the targets set by the patients charter.

The advantage of a general practitioner-driven system is that GPs are local, convenient and flexible. Consistent with the Conservative party's general approach to devolution wherever possible, we are seeking to devolve real power and responsibility within the national health service to the lowest possible level—to individual GP practices in our constituencies. The Labour party is keen on devolution, but the only devolution to the localities in which it is interested is devolution to local political bosses on local authorities. We do not want that. We want to devolve power to the parents in the schools and to the doctors in the surgeries.

One example of the effect of devolving power to the GPs was given to me by a GP fundholder, not in my constituency but near it. In the old days, he found it difficult to get an appointment with a particular consultant in the hospital, but now that he is a fundholder, the consultant sends him a Christmas card. That is a classic example of the change in attitude.

Consultants are more responsive to GPs, as are the hospitals and the administrators who run them. The flexibility that GP fundholding has given our doctors—not the amount of funding—has changed the quality of service that they can offer patients. As my hon. Friend the Minister explained to the House, GP fundholders get no more per capita than any other doctor, although they get a little extra money to pay for the administrative costs that are not being paid centrally and are therefore offset. In addition, they managed to save £64 million in 1993–94 alone, which more than offsets the extra money that they receive for administration. The doctors do not do the administration; they are out with their stethoscopes treating patients. They have administrators and practice managers, whom they sometimes share with other practices.

In Sussex, 56 per cent. of the population are covered by fundholding practices, and by next April we hope that the figure will have increased to 66 per cent. Fundholding practices have been able to bring to the locality such services as physiotherapy. Patients no longer have to go to the local hospital to see the physiotherapist; the physiotherapist comes to the surgery two days a week. The same applies to chiropody and dermatology services and asthma treatment. In respect of the latter two treatments, consultants visit surgeries and carry out procedures with the GP watching. GPs are learning on the job, and many of them are now carrying out those procedures without having to call on the consultants, and their patients do not have to go to hospital for treatment.

The fact that so many more treatments can now be carried out at GPs' surgeries means that there are shorter hospital stays, which must be good for everyone. Because of the £64 million that has been saved, GP practices are able to buy expensive endoscopy equipment and obtair. pathology results more quickly. That also benefits non-fundholders in the area.

Labour Members say that it would be easy for fundholders to close a local hospital by changing their purchasing decisions. As my. hon. Friend the Minister has explained, that can be done only within the accountability framework. Anyway, why would GPs want to close a good local hospital that was providing a good service to their patients? Surely they would want to close a hospital only if it was not good and they wanted to transfer their patients to a hospital where they would receive proper treatment. The signal being sent out by doctors exercising their freedom sharpens up hospital administrators and consultants, and forces them to provide a better service.

Doctors are now able to challenge hospital practices. Previously, they would have been listened to politely and then shown the door. Administrators no longer do that because they cannot afford not to listen to GP fundholders. In an area near mine, two hospitals providing parallel orthopaedic services, and therefore effectively competing with each other, were told by local GP fundholders, "That is not the right way to proceed. You must amalgamate and provide us with a greater range of options for our patients." In the old days, the hospitals would have said, "That is all very interesting," and then done nothing about it. Now, they have to do—and, indeed, have done—something about it.

All those benefits could have occurred in the old days under Labour, but they did not—just as British Steel could have made a profit, but never did, and British Airways could have been the best airline in the world, but never was until a Conservative Government privatised it and put responsibility where it would do some good. The Labour party said that the doctors could not cope with the administration involved in fundholding, and that they would all go bankrupt. It is one of Labour's scare stories that has not come true, and its reputation as a clairvoyant has received a nasty dent.

Remarks have been made about paperwork. No one wants paperwork in the health service, but sometimes it is necessary. I have spoken to doctors about the reports on prescribing that they have to complete. They think that they are very useful. They look at the reports four times a year and ask why one practice is prescribing more of a certain drug than the practice next door. Sometimes there is a good reason for that, sometimes there is not; but at least it focuses their minds. That shows that sometimes the paperwork is necessary and that the doctors want it.

To talk as if there was no paperwork prior to fundholding can hardly be reality. Doctors were always scribbling notes to consultants and filling in forms about their patients. Paperwork is nothing new. However, the Government have focused on the problems associated with form-filling and are reducing the number of forms by 15 million in the first tranche. I hope that they will then reduce the number even further.

This is a transitional period, with some practices being fundholding and others non-fundholding. Therefore, there is bound to be a difference in the quality of service being provided by the two groups. That is not to say that the quality of service will always be better when delivered by fundholders than by non-fundholders—sometimes it will be one, sometimes the other. The way to obtain the benefits that undoubtedly come with GP fundholding is to extend the system to all GPs. It is wrong to say that, just because, at the moment, we cannot all benefit, no one should benefit—that is absolute nonsense. It is what the Labour party says about the education system. It is absolute nonsense.

The Labour party says that joint commissioning is a great idea and that it is the way to proceed. It sounds very good, but it simply amounts to GPs having their say and nothing further being done. That is not the case when GPs have the money under their control.

Of course, the Labour party consistently rubbished everything that has been shown to work. For example, it rubbished the idea of the purchaser-provider split, but now accepts that it is the right way to run the health service. It rubbished the idea of NHS trusts, but now accepts that it is an extremely good idea.

What does the Labour party say about fundholding? On 13 September, the right hon. Member for Derby, South (Mrs. Beckett) said, "We oppose GP fundholding," but on 17 October—the same year—she said: We understand and welcome the advances that fundholding has brought to many patients.

Mr. Hinchliffe

Read the full speech.

Mr. Stephen

I am surprised that the hon. Gentleman has the nerve to try to intervene, given the lack of courtesy that he showed me during his speech.

In a 1992 paper, which was rather strangely entitled "Restoring the Nation's Health", the Liberal Democrats said: There is no case for GP fundholding". Since 1992, they have changed their minds, which, of course, they are entitled to do and frequently do. In 1994, they said: GP fundholding does seem to have brought benefits. By holding a part of the hospital service's budget, GPs are now able to demand a better deal for their patients, resulting in a turnaround time for tests being vastly improved and services becoming more personal. That is the Liberals for you.

It is amazing that the Labour party should claim that we have destroyed the national health service. It is even more amazing that anyone believes it. Indeed, it is a sad reflection on the mood of the press and the broadcast media. An old lady who spends 10 minutes on a trolley makes the front page of our local newspapers, whereas all the wonderful things that are done in the health service every day of the year go completely unnoticed in the local papers, and certainly never reach local television.

I am very angry about that, because the Conservative party has put an enormous amount of money into the health service—more than 50 per cent. more in real terms than the Labour party—yet Labour has the effrontery to say that we are destroying the NHS, and the media have the effrontery to assist it to mislead the public. It is perhaps a very good example of the notion that if a lie is big enough and told often enough, people believe it. I sincerely hope that when the general election comes, people will not believe it, because to hand control of the national health service to the Labour party would be an appalling tragedy.

Madam Deputy Speaker

Before I call either of the Front Bench representatives, I remind them that they will need the leave of the House to speak again.

2.7 pm

Mr. McLeish

With the leave of the House, I shall speak again briefly.

I am pleased to follow that rather spirited, but simplistic, contribution made by the hon. Member for Shoreham (Mr. Stephen) in defence of what the Government are doing to the NHS. I should not wish you to get me wrong, Madam Deputy Speaker; I am happy for tea to be provided for patients who have to wait, and I am also partial to receiving a Christmas card from my GP.

In essence, the hon. Gentleman was saying that the NHS is a bit like British Airways and British Steel—it is simply a matter of introducing market techniques and privatising a major service, and all will be well. I am not even sure that the hon. Gentleman believes that, but he was nevertheless keen to say it.

What was extraordinary was that the hon. Member for Shoreham should blame the messenger. He said, in effect, that there was nothing wrong with the message. Why are the Conservatives 40 percentage points behind Labour in the opinion poll in The Sunday Telegraph? It must be because of the press and the Labour party. We do not mind him blaming us or the press, but there should be no slight on the judgment of the people who have shown, in opinion poll after opinion poll, that the Government's health policies are not wanted.

Our approach has been to build on the best, which is a common-sense point of view. In few, if any, of the contributions made by Conservative Members did we hear anything about the innovations or good ideas coming from non-fundholders. Why? It is hard to escape the conclusion that that particularised approach basically means that the Government have closed their minds to any option other than GP funding.

Even if—and we have conceded it—benefits flow from GP funding and non-GP funding, why are the Government not simply saying to 50 per cent. of patients and 50 per cent. of GPs, "You are part of our future"? Some distress is being created because the Government will not accept the fact that, outwith GP fundholding, much good work is being done. Labour Members have established that point.

The second point that we have established today is that there is a two-tier system. Lurking behind the comments of most Conservative Members was an acceptance of that. Of course, they wanted it to be removed by the expansion of GP fundholding, but there was a tacit—in fact, more of a direct-acceptance that two-tier funding and two-tier accessing exist. That breaches the fundamental principles on which the NHS was based.

It is interesting to note and worth putting on the record that in the debate on Second Reading on 30 April 1946, when the national health service was being established, 172 Conservatives voted against the setting up of the NHS in the form that was being devised. It seems that, almost 50 years on—I do not want us to be discussing old Labour/new Labour—it would be useful for Conservative Members to go to the Library and read that debate. They may notice some particularly germane comments—

Mr. Congdon

I was not born then.

Mr. McLeish

Nor was I. Nevertheless, I am sure that Conservative Members can read.

I shall dwell briefly on two issues that have not been given sufficient attention. One concerns morale and recruitment in primary care services. Conservative Members will be aware of the report prepared by the British Medical Association, published in September 1995, on those issues. One paragraph about recruitment says: The Health Department is aware that there is a recruitment problem but so far it has failed to define its parameters. I am sure that that is a euphemism for saying that the Department of Health has done very little about it.

It continues: It needs to be persuaded that action is urgently needed to tackle the causes of the decline in recruitment. We are probably facing a serious long term manpower crisis. Those are the words of the BMA—not the Labour party or the organs of the so-called supporters of the Labour press. It is important that the Minister should address his comments to that point.

On morale, page 8 of the report says: GPs have also been angered by the continual denial of `two-tierism' in the NHS". Obviously, after today's debate, the BMA will know that the Government have caved in on that point. The report continues: it has become apparent that non-clinical considerations are determining where and when patients are treated. It is quite clear that, although the Government might not own up to questions about access and funding, other organisations, which know a great deal more about the health service than the Government, are doing so. That is encouraging, because it informs the debate, but a little depressing in relation to the lack of comment from the Government Front-Bench team.

The other issue which has not received attention is how the debate is taken forward. I quoted earlier some of the Secretary of State's more soothing comments about the fact that there is no one model. It is interesting that, given the fact that enthusiasm was lacking for the first two or three waves of GP fundholding, the Government are involved in a little experimenting themselves. In addition to standard fundholding, we have community fundholding, multi-funds and total fundholding.

Part of our argument is about the development of a concept. I would like the Minister also to address his comments to why, indeed, there is community fundholding and why there is multi-funding. Does that not illustrate the point that we are making, that what we need is to take the best out of the two systems that are operating and ensure, based on the principles of equity of access and funding, that we have the best primary health care system possible? If the Minister reflects on that, he will see the merit of what we have said.

The Government will be uncomfortable about my next point. The bigger agenda item is whether they can show the nation that they genuinely want the type of national health service that Labour wants to be developed into the next century. The public see through the step-by-step approach. We have seen fragmentation, contractualisation and commercialisation. A fifth term in power for this Government will mean privatisation of the service. I hope that the Minister will reassure me that that will not happen. More important, I hope that he will address himself to the fact that we still do not have a primary health care system that has equity of funding and equity of access at its core.

2.15 pm

Mr. Malone

By leave of the House, Madam Deputy Speaker. I hardly need to give a reassurance. I intervened in the opening speech by the hon. Member for Fife, Central (Mr. McLeish) to give precisely that reassurance about the Government's commitment to the NHS. I happily give it again: we are committed to a taxation-based system which will be free at the point of delivery. I do not know how we can make it clearer.

Instead of engaging in the issues of the debate and the qualities of GP fundholding, the Opposition, astonishingly, attempted to obscure the issue by suggesting that there was a hidden agenda. We have had a clear agenda for the health service, which we have rolled out since 1990 when the new health service took shape.

I thank all my hon. Friends for their contributions. In view of the short time left to me, they will understand if I do not recognise them individually. They will also understand that I have to deal with several important matters of principle which were raised by Opposition Members.

The hon. Member for Fife, Central tried to open " fresh debate about GP manpower issues and morale in his winding-up speech. I can deal with that simply. We take the issue extremely seriously. Manpower requirements throughout the service are taken seriously by my Department and by the profession, and we address them as a priority. That is why my right hon. Friend the Member for Surrey, South-West (Mrs. Bottomley), the then Secretary of State for Health, announced earlier this year that we would create 500 more student places in medical school, and that is why I referred earlier to the increase in the number of medical students since 1979. Of course we take these matters seriously.

If there was clear evidence that there was difficulty in GP recruitment, we would be concerned. In practice, when GP posts are advertised, more people apply than there are posts available. The same is true for trainee posts across the country.

Mr. Rendel

indicated dissent.

Mr. Malone

The hon. Gentleman shakes his head. I assume that he is implying that there is a general difficulty. There is not.

I want to take head on three points that have emerged from the debate. I found it extraordinary that Labour Members, having set out to say how all the good things that GP fundholding had achieved were bad and that it was unfortunate that the good things were not being extended to others in the health service, said that they did not know whether GP fundholding was good or not because there had been no proper evaluation. My hon. Friend the Member for Wyre (Mr. Mans) made a specific point on this, as did the hon. Members for Newbury (Mr. Rendel) and for Dagenham (Ms Church) in a number of interventions.

There are two sorts of evaluation, of which the first is peer group evaluation. As my hon. Friends rightly pointed out, it was not a question of the Government forcing GPs down the fundholding route. Fundholding is a process that has rolled out through six waves of GP fundholding. As peers have watched what their equivalents have been able to achieve in GP fundholding, many of them, who were often highly sceptical at the outset, have evaluated what is happening and moved forward. There is also much independent research into fundholding; the suggestion that there is none is nonsense.

A national centre for primary care research and development has now been set up at Manchester university, and it will be an important resource for taking forward primary care research and the associated agenda. I opened the centre this spring, and I was delighted to do so. It will cost £1.5 million per year for a 10-year period to develop a sustained programme of work to explore a range of primary care issues. That will include watching fundholding develop. In addition, £500,000 is being spent on total fundholding evaluation, and that is already under way.

Other work is taking place at a more local level, and evaluation is being carried out by the National Audit Office. The Public Accounts Committee has already worked on the subject, and no doubt will return to it. It is nonsense for Opposition Members to say that there is no evaluation, and that we are introducing the system to ensure that no one will find out what is happening, and we cannot measure the benefits. There is a comprehensive programme in place.

Accountability was another issue raised by Opposition Members, especially by the hon. Member for Wakefield (Mr. Hinchliffe). We all sat with bated breath as he announced that he was about to reveal to us why he had left the Front Bench and returned to the Back Benches. I am almost obliged to ask him: is that it? If so, we look forward to his return to the Front Bench as quickly as possible. However, at least the hon. Gentleman has the ability to deliver miserable facts with a cheerful face, which is a great benefit compared with the attitude of many of his hon. Friends.

The hon. Gentleman asked about accountability. Of course that is fundamental, and it is dealt with in the accountability framework that we debated at length during the passage of the Health Authorities Act 1995. The purpose of the framework is to balance the requirements of public accountability within a centrally funded service, with the need to minimise the administrative work load on general practices and health authorities.

The policy will be implemented nationally in several ways. Any major shifts in purchasing intentions will have to be published six months in advance, just as health authorities are obliged to publish their intentions. Fundholders will be in the same position. The idea that Labour Members put about during the debate, that there will be great changes and dislocations in services across the country, is absolutely untrue.

Mr. McLeish

That is already happening.

Mr. Malone

I find it surprising that the hon. Gentleman should say that. The purchasing power that fundholders have at their discretion is inevitably a small proportion of the activity in any provider unit. The point about exercising the power of the budget is that it makes provider units think in a different way. Practices that are not fundholders readily accede that they also benefit. When fundholders get better services, they follow, and the whole system is uplifted.

As well as the publication of purchasing intentions, an annual practice plan will have to be given to the health authority. Practices will also have to produce a performance report, and review performance regularly with the health authority.

That illustrates the fact that there will be a firm framework to make GP fundholders truly accountable, as they should be—ultimately to Ministers, who have custody of the policy. The framework will come into effect in the course of next year, and already many of its elements are being put into place. Local workshops involving GPs and others are taking place all over the country to explore all the issues arising from it. It is entirely wrong to suggest to the House that there is no accountability for GP fundholders, yet that was one of the main planks on which the Opposition rested their case.

Another issue raised was equity. Despite Opposition Members' attempts to suggest that there has been some sort of admission that a two-tier health service exists, that is not the case. I find entirely incomprehensible the persistent misrepresentation by Opposition Members of a self-evident fact about fundholding.

Let me reiterate the Government's position. Equity in funding comes from the allocation of resources which are given to health authorities. These resources are allocated on an equitable basis to fundholding practices. The fundholders then derive extra value out of the equitable resource and spend it on behalf of their patients. That is what the Opposition cannot stomach.

Mr. Hinchliffe

rose—

Mr. Rendel

rose—

Mr. Malone

I will not give way, as I have only six minutes in which to conclude.

The hon. Member for Fife, Central asked about the benefits from joint commissioning, but misrepresented what I said. I clearly remember saying that there are benefits, but they are sporadic and cannot be relied upon, as they are spread across the country.

The hon. Gentleman referred to those involved in joint commissioning, and cited the practice at Blackpool. But such people find it very difficult to persuade the health authorities to go along with the plans they put forward. The reason for that—this is at the centre of this debate—is that those people do not exercise purchasing power. Joint commissioning groups can be talking shops with GPs, but they will make no progress if they do not exercise their financial muscle.

Mr. Hinchliffe

Will the Minister give way?

Mr. Malone

I will not give way to the hon. Gentleman.

Mr. Hinchliffe

On a point of order, Madam Deputy Speaker. I assumed that, in winding up the debate, the Minister would respond to the points that have been made. I have made serious allegations about health care in my constituency—

Madam Deputy Speaker

Order. That is not a point of order for the Chair. If the hon. Gentleman who has the Floor does not give way, other hon. Members must resume their seats. That is a well-known and established rule.

Mr. Malone

I dealt with the hon. Gentleman's point during his speech. I told him that if he submitted all the cases he was talking about to me, they would be examined in full, and he would get a response.

Mr. Hinchliffe

I want answers.

Mr. Malone

The hon. Gentleman will get answers, but not from me at this Dispatch Box unless I know all the facts. I shall be happy to respond to the hon. Gentleman on that basis.

The hon. Member for Barking (Ms Hodge), who has apologised for not being in her place for the winding-up speeches, made some interesting suggestions about the Government's general policy of equity and fairness. She said that her constituents were being done down because there was less cash in Barking.

Although I did not have the precise details during the hon. Lady's speech, I am pleased to say that I have them now. Barking and Havering is 1.7 per cent. behind the target fixed by our fair allocation process, so—contrary to what the hon. Lady said—resources in her constituency and health authority area are set to increase as it moves towards the target. When one gets suggestions from the Labour party, it pays to treat every single one of them as if it had a health warning.

I ask the Labour party—which Government introduced deprivation payments for general practice? The present Government did. Which Government introduced the new health authorities which, at a far more local level, will set out the priorities for health care? The present Government did that, and we now have the framework firmly in place.

Much was made by the Opposition of their belief that there was no wish among professionals to have GP fundholding, but the opposite is the case. It has been a success, as a survey of fundholders by the Association of Fundholding Practitioners has shown.

Mr. McLeish

Surprise, surprise.

Mr. Malone

The hon. Gentleman might say that, but he should bear in mind that the vice-chairman of that organisation is Dr. Mike Armstrong, a member of the Labour party. This is not a partisan point, and I would have hoped that the results of the survey would suggest that fundholding has been successful and that patient care has benefited as a result.

Dr. Mike Armstrong has a warning that the hon. Member for Fife, Central should heed: he has said that, if Labour is to appease fundholders, it will have to offer more than a mere advisory role—that is what the hon. Gentleman has offered today—and will have to concede some budget responsibility.

At the end of an important debate, we get back to that central point. Improving health care driven by primary carers means that some budget responsibility must follow. We have noted that the hon. Member for Fife, Central was not prepared to concede that point, and GP fundholders and others in the country will have noted that as well.

It being half-past Two o'clock, the motion for the Adjournment of the House lapsed, without Question put.