§ motion made, and Question proposed,That this House do now adjourn.—[Mr. Jamieson.]
§ 7 pm
§ Sir Teddy Taylor (Rochford and Southend, East)As you know, Mr. Deputy Speaker, it is not my habit to seek Adjournment debates, but I have come to the conclusion that this is the only way to put on record my disappointment, concern and anger at the manner in which a complaint about alleged serious malpractice in the health service has been dealt with. If it is in any way typical, it is not in the interests of public services or of the people; it is also an insult to parliamentary democracy and the safeguards that are meant to stem from it.
In my constituency, there is a successful and distinguished firm called Rebus—a provider of IT services. Among the applications that they offer is Medirisk, a risk management software tool, which is used in the NHS. Rebus is obviously competitive, and during the summer of 1999 it was most concerned to hear that a person—whose name I have provided to the Minister of State, Department of Health—had secured a position as controls assurance project manager within the NHS executive, although he was a director of a firm producing an application that was a direct competitor to Medirisk. Rebus was even more concerned to learn not only that he was a director, but that he actually owned a third of the share capital.
That worry and concern became alarm, however, when it was reported to Rebus that the person to whom I have referred was actually promoting the sales of his company's products and that he had allegedly given some officials the message that his firm's products were the only ones that should be purchased.
Rebus also received a report from a lady whose initials are KM—I have passed her name to the Minister—who is a respected clinical risk adviser and also a local councillor in Northampton. She stated that, at a conference held at the Good Hope hospital NHS trust, the project manager had described his project as the preferred choice of the NHS. As she was so concerned about the situation, she took the trouble to contact Rebus with that information.
Rebus obviously felt that something was seriously wrong and so made a complaint to the director of finance and performance of the NHS. He took more than a month to reply, but when he did so, he indicated that Rebus had obviously misunderstood the situation. He explained that in fact two products were produced by the firm. One, which had been financed by the NHS, was concerned with modules for auditing compliance with health and safety legislation, but it had the same name as the risk management product. He said that clearly the manager had been referring to one rather than the other. Of course, letters can be misquoted, but I have all the correspondence and I shall be glad to show it to the Minister so that he can read it himself. I hope that he will study it.
The basic point, however, was that although there had been an indication that someone had heard and seen an alleged abuse, no one asked to see the lady who had made the complaint—to make contact with her to obtain further information. The answer was simply that it was a load of rubbish.
542 After that delayed letter, Rebus started receiving other reports of alleged abuses. For example, a hospital in Liverpool had apparently been instructed by the regional office of the NHS executive to purchase a product to which I will simply refer as product S. Another report related to a potential client within the health service who had phoned the project manager—the chap who held the shares—to ask his advice on the purchase of a risk management system. The answer—which was noted carefully, word for word—was that there was no way the NHS executive would continue with any product other than S, given the amount of money that had been invested in it.
Rebus's view was certainly that the possible purchasers in the NHS had gained the impression that product S was the preferred choice of the NHS, because of which Rebus found that, although several hundred people were interested in buying the systems, only five got them. The rest were worried, concerned and confused. Never in the firm's history had it received so many inquiries but so few purchases.
Reports of apparent abuse continued to be received, so the firm decided to approach its local Member of Parliament. This is the point that I hope that the Minister and his colleagues will consider. I was rather horrified by the reports, so when the firm sent me a formal letter, dated 1 February, I wrote to the Secretary of State on 3 February. As the points at issue were so clear and precise, and as I had provided in the correspondence the name of one of the people who had heard the abuses, I presumed that they would be dealt with speedily.
Although the letter was sent on 3 February, two months passed and I heard nothing. I phoned the Minister's office to ask what was happening. Nothing happened, so I sent a reminder letter, dated 1 June, to the Secretary of State, but still I received no reply. I genuinely did not know how to motivate the Minister to take the issue seriously, so I tabled a parliamentary question, marked W—a procedure that was designed to stop Ministers delaying answers.
The Minister will be well aware that I tabled the question for answer on 28 June—quite a long time ago—so it should have been replied to on that date. I simply asked the Secretary of State when he would reply to my letter about the serious alleged abuses in the health service, but no reply came. I received no reply the following week; nor the following month. You may be surprised to hear, Mr. Deputy Speaker, that I have not yet received a reply. I inquired by phone again today, and the Table Office confirmed that there is still no reply.
The whole business began to make me suspicious. Was it simply a case of an arrogant Minister who did not care about serious allegations relating to the health service, or did he not want his name to be associated with what was happening? I made inquiries about the S company. It emerged that it was not really a giant, but a small company. In 1998, there had been a loss of £4,000 on a very limited turnover and, in 1999, a profit of £73.
I will not make public my suspicions, but I think that the Minister will know what I am talking about. Whatever the circumstances, I knew that the whole episode was an insult to democracy. As I had tried tabling questions, speaking to the Ministers and sending letters, I decided that the only thing to do was to write to the Prime Minister and to Madam Speaker. On 23 August, I sent a long letter to the Prime Minister and another to Madam Speaker.
543 The Prime Minister's assistant, Jan Taylor, who is obviously a polite lady, wrote back to me on 29 August. On behalf of the Prime Minister, she said:
I will ensure that a reply is sent to you as soon as possible.However, despite that assurance from No. 10, August passed and so did September. I decided to do things differently. Perhaps the Prime Minister was not as powerful as I had thought, so I decided to do something else—I would not dare tell the House what it was. The result was that, at long last, I received a reply dated 2 October in answer to my question of 3 February. The Minister had obviously been working hard.The Minister will be aware that Mr. Reeves said that the witness to whom I referred was not relevant and misunderstood the situation. The Minister answered that the witness had not been there, or that no one could remember whether she was there. No one could recall having seen her, although the hospital invited her to go along and although she has been recognised by many people who were there. I have a list of people who had met her there, but the Minister said that she was not there, so there was no point in pursuing the case. He also said that he was sure that Mr. E had not abused his position.
I responded immediately to the Minister with a letter saying that KM had been present at the invitation of the risk manager at the hospital, and I gave the Minister a detailed description of the most recent case of abuse, which was much worse than the others. Of course Rebus was angry, and it sent its own letter. We do not have replies yet, and we may have to wait for another nine months or a year.
I am grateful to have the opportunity to put these events on record and all the points that I have made can be confirmed by documents, letters and statements. I now wish to ask the Minister five simple questions. First, does he consider that Ministers and officials have dealt with the complaints adequately? Is the case not an affront to the democratic system?
Secondly, does the Minister think it right to arrange for an official in his Department to speak to the many witnesses who are willing to spell out clearly what they regard as a very serious abuse? I can give him the names and the telephone numbers of those who are prepared to do that.
Thirdly, in light of the issues that have been raised, is it not important that the Minister should say on behalf of the NHS that, subject only to the wishes of their patients and communities, hospitals are entirely free to purchase whatever risk management equipment they wish? If he says that they are free to do that and are not guided by what is regarded as the favourite of the NHS, that will make a difference.
Fourthly, does it not genuinely worry the Minister, as a democrat, that when the controls assurance project was launched in November 1999 at the London Arena, only one company—the S company—had an exhibition stand even though the NHS executive was well aware of the conflict of interest? Was that right?
Finally, will the Minister consider the many complaints of abuse that have been made? To give just one more example of an information leak, it is a fact that, when the S company advertised at the London Arena, a version of 544 its product had been built to contain all the controls assurance standards. Those standards were not released to NHS managers until after the event. Will he try to find out how this miraculous firm was able to produce something with all the specific standards that had not even been published, and was able to have the product on display at a public exhibition? Access to privileged information is valuable, so if this is not an important issue, what is?
The issues that I have raised are serious. I have not tried to discuss them from a political perspective; I simply say that what happened was wrong. Something should happen and someone should do something. If nothing is done, that will be an insult to democracy, fairness and to all the things that the Minister and I embarked on when we came into politics. I hope that he will think about the issues and reassure us.
§ The Minister of State, Department of Health (Mr. John Denham)I congratulate the hon. Member for Rochford and Southend, East (Sir T. Taylor) on securing the debate. He may have raised one or two issues that are new to me and that I will need to follow up, but I will answer all his points to the best of my ability.
It took a long time for the hon. Gentleman to receive a reply; it was sent at the beginning of October. I spoke to him in the Corridor during the summer, so he will accept that I apologised for the delay. I said that it had happened because the issues that he had raised were serious and I wanted to assure myself that they had been properly investigated before I signed a letter to him. If there has been an oversight in the Department about the parliamentary question that he tabled, I apologise unreservedly. He deserved an answer to that in addition to the lengthy letter that I sent him.
By way of background, the national health service suffered from high-level failures in corporate governance in the mid-1980s and early 1990s. There were fundamental cultural problems in the failures of the Wessex and West Midlands regional health authorities, so we took a series of measures to improve corporate governance, enhance risk management and control in the NHS, and counter fraud. As a result, there has been an unbroken sequence of five years of unqualified accounts.
In 1994, the NHS corporate governance taskforce recommended a set of measures to improve the accountability of NHS boards, in line with the 1992 Cadbury recommendations on financial aspects of corporate governance. That included the adoption of three governance codes by all NHS health authorities and trusts: codes of conduct, accountability and openness. To clarify further the responsibilities of NHS bodies, chief executive officers of NHS boards were formally designated accountable officers from 1995. They are accountable through the NHS executive to Parliament for resources and probity. In the mid-1990s, remuneration and terms of service committees were established to ensure that the employment contracts of board members are fair and reasonable.
The final piece of corporate governance is controls assurance. That process is designed to provide evidence that NHS organisations are doing their reasonable best to manage themselves so as to meet their objectives and protect patients, staff, the public and other stakeholders 545 against all kinds of risk. It is a basis on which chief executives as accountable officers must discharge their responsibilities. Similarly, it supports the accounting officer in the provision of assurances to Parliament and the public.
The Department is in the process of designing a complete and integrated set of controls assurance standards which, taken together, will clarify and make measurable compliance with laws and regulations covering all areas of risk. The assurance process culminates in a statement by NHS boards that an effective system of control is in place and working properly to ensure that risk and controls to mitigate it are continuously assessed and prioritised action is taken. The aim is to provide one clear set of standards covering financial, organisational and clinical systems. The controls system is complex, but we are now in a position to describe it fully and to consider how best to provide tools for controls assurance—the central topic of the hon. Gentleman's concerns.
Several months ago, the hon. Gentleman raised concerns about how software to support controls assurance in the NHS would be chosen. A constituent employed by Rebus suggested that there might be a conflict of interest associated with a member of the controls assurance team, to which the hon. Gentleman referred, given that that person had shares in one company that supplies risk management software to the NHS. The constituent also made allegations of impropriety on the part of the member of the team. I assure the hon. Gentleman and his constituent that action has been taken to ensure that the gentleman's appointment has not led to a conflict of interest, and the recent allegation of inappropriate behaviour has been fully investigated.
The hon. Gentleman gave a couple of examples of the cases that he has raised. He referred to one hospital in Liverpool, which I do not believe has been raised with us previously. I shall therefore need to follow up that point. He also referred to a presentation at the Good Hope hospital in Birmingham. It was suggested that a lady, to whom he referred by the initials KM, had attended that presentation. She subsequently reported inappropriate behaviour by a member of the controls assurance team. When I wrote to the hon. Gentleman on 2 October, I said that there was no recollection of anyone of that name being present at the meeting. That was the result of the investigation that I instituted.
We then received—it has been repeated in the debate—a further allegation that that person had attended the meeting and was well known to people there. When we received that allegation from the hon. Gentleman's constituent a few weeks ago, I asked my officials to go back to Good Hope hospital. I have here a letter from the director of nursing, which states:
I am the Executive lead for risk management and controls assurance at Good Hope Hospital NHS Trust.The letter goes on to state that she invited various people to speak at the meeting. It said that the presentation was targeted at an audience of key internal people and, with the exception of the two speakers, no other external people were invited to the meeting. The director of nursing said that she had absolutely no recollection of someone with the initials KM attending the meeting. Her letter continued:In fact, I have never heard of this person and have certainly never invited her to the Trust. In addition, at the time of the presentation we did not actually have a Risk Manager in post.546 It is alleged that a risk manager who did not exist invited somebody to a meeting. The person who organised the meeting and made the invitations told my officials in writing that she did not invite the person concerned and had never heard of them. From that incident the hon. Gentleman will understand that investigating the matters that he has raised, which I entirely accept are serious allegations, is not as straightforward as has been suggested.It was further alleged, as the hon. Gentleman implied, that the individual at the centre of the debate had used his position to suggest that the product sold by the company with which he was associated was the only one that was appropriate for the NHS. We have of course contacted the person who is alleged to have heard the comments and to have reported them to the hon. Gentleman. He wrote to my officials to say that he had contacted the individual about whom we are talking to inquire about databases for controls assurance and incident reporting.
The person said that he had asked the individual about the software that has been mentioned and
whether or not the Trust should move in that direction.
The gentleman about whom the complaint has been made advised that the software
was used in over 150 trusts and had been developed by the NHS with investment of approximately £im. Its future was in doubt as the NHSE was looking at other databases.
The letter to my official continued: You shared with me the paragraph—
in the hon. Gentleman's constituent's letter—
which had led to your phone call. What he has written does not accurately reflect the manner in which the information was presented … It misrepresents what I told
the hon. Gentleman's constituent. He went on to say:
I also had the conversation with him in February and not two weeks ago.We have spent a lot of time investigating these complex issues. The comments that people have made do not match the records that others have given me. I am in no way criticising the hon. Gentleman for raising these concerns. I know him well enough to know that he does so with complete integrity and in absolute good faith. I hope that he will accept that I have made strenuous efforts to get to the bottom of the allegations.
§ Sir Teddy TaylorWill the Minister make it clear that hospitals are entirely free to purchase whatever risk management equipment they think appropriate, subject only to the interests of their patients and the community?
§ Mr. DenhamAs I will make clear—this is an important aspect of the issue—a process is under way to identify suitable software for that application in the NHS. It is important for the background of the discussion and the concerns of the hon. Gentleman's constituents that I am able to set out that exact process.
I shall deal first with the appointment of the member of the controls assurance team who has been under discussion tonight. That was not a ministerial appointment, but the individual was appointed under open competition and on condition that he resigned his directorship of the company with which he is associated. He did that before taking up his post on 1 October 1999.
547 I have sought advice on that appointment, and I have not been given any advice that proper practice was not followed in line with the civil service rules of the time.
The gentleman concerned has agreed to sign, in respect of his shareholding, a Nolan-type register of interests that will be introduced by the Department of Health for all employees in the near future. In addition, because of the concerns raised by the allegations, the gentleman has been formally made aware of the concern arising from his shareholding and advised that he must be extremely careful lest his actions lead to any misunderstanding of his position. I acknowledge that there is scope for confusion in distinguishing between the software, which is Crown copyright, and the limited company of the same name in which he has shares.
The man in question was originally an academic. The higher education institution at which he worked developed an IT quality, safety and risk management software product for the NHS. The NHS had contributed about £584,000. The product was distributed free of charge to the NHS. Subsequently, 160 NHS organisations have paid a licence fee of £1,000 per annum to receive updates and new releases.
In March 1996, the higher education institution established a spin-out company with a former employee of the NHS Scotland management executive, the gentleman whom we have been discussing and Strathclyde university as its three shareholders. The Scottish Office licensed the software to the higher education institution which, in turn, sub-licensed it to the company. The original software is Crown copyright, so it may be possible for the NHS to take the product in-house and develop it, or sell it to another company to further develop the software.
Given that background, it was sensible for the NHS executive to explore whether the software, with further development, would be a suitable system to provide support to the NHS in meeting the requirements of controls assurance. Devon and Cornwall NHS Audit Confederation was asked to carry out such a review in 1998. A number of recommendations were made in the report outlining how the software would need to be developed if it were to be suitable for all NHS trusts and health authorities to meet the needs of controls assurance.
The gentleman we are talking about was on secondment to the NHS executive at this time and concern was expressed in the report about a potential conflict of interest. In April 1999, Liverpool John Moores university was approached to examine three issues relating to the systemisation of controls assurance in the NHS. The consultants were asked to look at the possibility of a conflict of interest, to evaluate systems currently available and in use within the NHS which could be adapted or adopted for controls assurance in the NHS, and to provide an outline evaluation of those software packages that are currently available in the market which may have the potential to meet NHS controls assurance requirements.
548 The report recommended, rightly, that to resolve any conflict of interest the individual we are discussing should be excluded from any and all work associated with the decision-making process relating to the software solution for controls assurance. The overall conclusion was that there were several products that satisfied NHS requirements. The consultants highlighted the fact that the only way fully to test the market would be to invite expressions of interest to tender against an outline specification—in short, to place an advertisement.
A review of software systems commenced in July 1999, carried out independently by the chief executive of NHS Estates. In September 1999, an advertisement was placed in the Official Journal of the European Community, to which 15 suppliers responded. Six were shortlisted based on the information received from the companies. The hon. Gentleman's constituent was not one of those six and was informed of the decision in a letter dated 10 January 2000. However, the result of the shortlist was that none of the six was deemed suitable for recommendation to the NHS, because all of the software packages required further development to meet the needs of the NHS.
Further work having been deemed necessary, an independent review was carried out in consultation with the NHS. The review was completed a few months ago. It recommended that, in the light of the changes that have taken place, a procurement process should commence with an outline business case and the placement of a further OJEC advertisement. The key point is that such a process will ensure that all suppliers, including the hon. Gentleman's constituent, have an opportunity to be considered. I do not believe that in the matter of the supply of controls assurance software to the NHS the hon. Gentleman's constituent has been disadvantaged.
A user group has been established to ensure that the needs of the NHS are fully explored and to assist in developing a detailed specification for the software. The controls assurance support unit at Keele university is leading the work. That thorough process involving independent organisations and users from the NHS will enable the hon. Gentleman to assure his constituent that a conflict of interest has been avoided. He will also have a further opportunity to demonstrate the value of his firm's software.
My response has been rather detailed, but the issues raised by the hon. Gentleman are of great importance. I acknowledge that the examination of the issues has been complex, but I believe that it has been carried out properly. I hope that the hon. Gentleman will now feel able to give the proper assurances to his constituent and that he will feel certain that every necessary step has been taken to avoid a conflict of interest. I take the matters involved very seriously.
§ Sitting suspended, pursuant to Order [22 November.]
12.27 am§ Question put and agreed to.
§ Adjourned accordingly at twenty-eight minutes past Twelve midnight.