NHS Trusts

HL Deb 16 October 1991 vol 531 cc1108-17

3.47 p.m.

Baroness Hooper (The Parliamentary Under-Secretary of State, Department of Health)

My Lords, with the leave of the House, I shall now repeat a Statement being made in another place by my right honourable friend the Secretary of State for Health on National Health Service trusts. The Statement is as follows:

"Mr. Speaker, I will, with permission, make a Statement about NHS trusts.

"On 4th December 1990 I reported to the House that I had received 66 applications from hospitals and other units wishing to operate as NHS trusts from 1st April 1991 and that I was able to establish 57 of these as the first NHS trusts.

"The decision to pursue trust status was one which the managers and the clinical staff in those units took for themselves. Honourable Members will recall that in the great majority of the 57 first wave trusts most of the consultants expressly supported the applications.

"The experience of the first wave confirms the confidence which was shown by the managers and professional staff, who recognised the benefits to be gained from putting management responsibility back where it ought to be in the hospitals themselves. Many of my honourable friends have constituencies, as I do, which are within the catchment area of trusts. They will know, as I do, that it is easy to find examples of the new, devolved arrangements improving care for patients. I will give just four kinds of examples out of the many which are available.

"On waiting lists, the Royal Liverpool University Hospital Trust now sees 90 per cent. of all its patients within 10 months—one of the best performances in the country. On activity levels, the Freeman Hospital Trust in Newcastle has treated 4,700 more patients in the first five months of this year compared with last. On front-line recruitment, the East Gloucestershire Trust is to recruit an additional seven consultants to meet growing demand for its services and the South Devon Trust is recruiting an extra 55 nurses and midwives. On improved quality, the Norfolk Ambulance Trust has speeded up its training programme for paramedics and aims for a target of 24 paramedic teams for its ambulances each year.

"Independent surveys, for example by the consultants Newchurch and Company and by the Sunday Times, point to the same conclusion that the trusts are improving their performance, treating more patients and cutting waiting times. A BMA survey published this week has also shown increasing consultant support for trusts. This has strengthened our commitment to the trust programme through which more and more NHS patients can benefit from the clearer and simpler management structure which trust status gives to hospitals and other services. I was glad therefore to receive applications from 113 hospitals and other units—double the number of first wave trusts—wanting to become trusts in the second wave from 1st April 1992.

"I have considered all these applications very carefully and assessed them against the same criteria that I used last year. Each one has been the subject of a full public consultation.

"As a result, I have decided today to establish 99 hospitals and other units to operate as trusts from April 1992. The details are available in the Vote Office and have been placed in the Library.

"In addition, I have agreed to approve applications from the four London teaching hospitals in the second wave. As the House will know, I have recently commissioned Sir Bernard Tomlinson to act as my adviser on health services in London, supported by a high-powered team. It is obvious that he may have recommendations to make which would affect the shape of the London teaching hospitals. In order to allow the four new London teaching hospital trusts to develop their plans with the benefit of Sir Bernard's advice, I have therefore decided to delay the date on which they become operational until April 1993. However, I have asked the NHS Management Executive to establish devolved management in these hospitals at the same time as the other trust boards are established. In this way these four great hospitals will get as early as possible the benefits of devolved management.

"Seven other units have the potential to become successful National Health Service trusts, but I have not felt able to establish them in the second wave. I am sure that they will benefit from having longer to develop their applications and I hope that they will reapply next year. A further three units have withdrawn their applications from 1992. However, I can tell the House that I have today agreed that 153 expressions of interest from hospitals and other units may be pursued for the third wave, starting in 1993. I have also made this list available in the Vote Office and placed a copy in the Library.

"All trusts are accountable to me through the National Health Service Management Executive. I have now asked the Management Executive to strengthen and expand its monitoring arm in order to ensure that the growing number of trusts remains fully accountable to the centre. This will be done without increasing overall NHS administrative numbers.

"The campaign against trusts and against devolved management fostered by the Opposition has failed. Throughout the National Health Service, as the British Medical Association has confirmed, there is increasing recognition of the benefits which trust status brings. My Statement today is good news for the National Health Service and good news for its patients. After next April, when the new trusts which I have announced today will begin operating, over one third of all National Health Service hospital and community health services will be in the capable hands of the trusts. Despite a truly scurrilous campaign by Opposition parties, no informed observer can now doubt that trusts represent a necessary modernisation and simplification of National Health Service management, which is already proving itself good for patients, good for staff and good for the country. It is a tribute to their commitment to the National Health Service that so many doctors, nurses and managers have put so much work into preparing the applications which I have been able to approve today."

My Lords, that concludes the Statement.

3.53 p.m.

Lord Ennals

My Lords, I thank the Minister for repeating the Statement made in another place by her right honourable friend. Contrary to the views of the Secretary of State, I believe that this decision is the height of irresponsibility. This Government, regardless of the genuine and widely-held concerns among all sections of the public, seem prepared to gamble with the health of the nation against the better judgment of the professions which provide health care. The Government seem to have learnt nothing from the problems met by the first wave of trusts and seem determined to force the pace of undermining the powers and responsibilities of the newly-established, business-oriented district health authorities. I believe that that is leading to the fragmentation of a once national health service.

The behaviour of this Government confirms the fears that they are incapable of being trusted with the running of the National Health Service. Of course they will keep a small, poor man's service for those who cannot pay.

Before making further comments perhaps I may ask the Minister some direct questions. First, apart from his selective comments in the Statement, has the Secretary of State published a report on the progress made by the first wave of 57 opted-out trusts? If not, why has he not done so? I noted that there were four indications of success. Has he published a report? I ask the Minister directly, in view of debates which we have had in your Lordships' House: what about the promises made to this House concerning the new, untried NHS trusts? What about monitoring, analysis and assessment and learning as we went along? We are entitled to know what the evidence is.

Secondly, have the business plans of the applicants in the new round been published for public scrutiny, not only by those in your Lordships' House and in another place but by people locally who look to their local hospital to provide a service? If such a report has not been published, why not? Why the secrecy? Has the new accountants' survey by Coopers and Lybrand Deloitte been published? If not, why not? Once again, why the secrecy?

Thirdly, what is the cost of introducing these new market-oriented proposals? Does the Minister accept the BMA's figure of £400 million, which is enough to treat every patient on hospital waiting lists at the present time? It is a disgraceful use of scarce resources.

Fourthly, what note has been taken of the strongly expressed views of the doctors, nurses and other professionals and of many of the regional health authorities? Despite the bland comments in the Statement by the Secretary of State none of them approves this Gadarene swine-like rush into a new opt-out pattern. They believe, as I believe, that it is sheer Tory dogma.

Fifthly, have the Government studied the recent BMA survey—which was referred to by the Secretary of State? That survey indicated that trust status was presented to BMA members as inevitable; there were fears for the survival of the hospitals in the face of competition from other trusts; and, in only a few hospitals was there positive enthusiasm for trust status". That is quite contrary to the impression given by the Secretary of State in his Statement.

Sixthly, what answer did the Government give to the recent pleas from the BMA and the Royal College of Nursing for a delay in taking the decision which has been announced today?

Does the Minister accept that increasingly NHS patients are being forced to go private, not just because of the imposition of sight tests and dental charges but because of creeping privatisation in the NHS trusts and in the rest of the service? The private sector will be delighted by the Statement today because it will see it as part of the process of the disintegration of the National Health Service, although I note that some private sector firms are going bust as a result of the recession.

Finally, what significance are we to give to ministerial promises, which are being broken every day? Before the 1979 election, when I was Secretary of State for Social Services, Mrs. Margaret Thatcher told me in answer to a question that she had no plans to increase prescription charges. Since then they have been increased 17-fold, from 20p. to £3.40. I believe that this decision will be deeply resented by the public, who do not want those changes, and that they will show their anger when the Government are eventually forced to go to the polls.

Baroness Robson of Kiddington

My Lords, we on these Benches also thank the Minister for repeating the Statement made by the Secretary of State in another place.

I intend to be circumspect in what I say and stick exactly to the Statement. We are worried that another 99 hospital trusts are to be established during the next year. We are worried because, if the noble Baroness remembers, when we debated the new health reforms in this House many Members of this House urged the Government to have a pilot scheme on the system before going ahead. In the event, 57 trusts were established last year. Why could not the Government have left those 57 trusts for a little longer as a pilot scheme? Why another 99?

I say that because those 57 trusts are not functioning properly under the provider and purchaser principle as the contracts that have been entered into are based on historical factors going back before reorganisation. They are not ready, though one hopes that they will be ready on 1st April 1992, properly to cost their services so that the provider-purchaser principle can begin to function. That is why I regret that another 99 hospitals have been thrown into the melting pot before we know where we are.

We welcome the statement that an advisory committee on services in London has been set up. It is unbelievable that that should not have been set up a long time ago. We have all been aware of the problems of over-provision in London for many years. We have the problem of an excessive number of teaching hospitals within Greater London. It is a pity that two hospitals have already been granted trust status before the inquiry has taken place. I sincerely hope that the inquiry will have reported and solved the problems of which hospitals survive in London before the next four are introduced in 1993 because the commercial principle of provider and purchaser could wreck some of the best hospitals in London and perhaps allow some of the not-quite-so-good ones to half survive. It must be done on a balanced basis.

There is a sentence in the Statement to which I take great objection. It contains the phrase: Despite a truly scurrilous campaign by Opposition parties". We have not taken part in any scurrilous campaigns. We are interested in the survival of the NHS. We have criticised and commented, but we have not taken part in any scurrilous campaigns.

4.3 p.m.

Baroness Hooper

My Lords, I am grateful to the noble Lord, Lord Ennals, and the noble Baroness, Lady Robson, for their comments. I am particularly grateful to the noble Baroness for her note of welcome and her positive and constructive approach. I strongly contest the noble Lord's initial suggestion that we are fragmenting. It is interesting to note that we have moved away from the use of the word "privatisation", since the definition has been questioned, via commercialisation into fragmentation. Fragmentation has many benefits and effects, but I define it in the context in which we are speaking as giving proper control at the grass roots to the people who work in the National Health Service for the benefit of patients in the National Health Service. I therefore well understand the welcome of the noble Baroness, Lady Robson, for this example of an effective way in which the National Health Service can be improved.

The noble Lord, Lord Ennals, asked a number of questions. He asked whether we had published a report of the first wave trusts. He also made some comment about the discussions in your Lordships' House during the passage of the Bill on whether a pilot project should be set up. The noble Baroness also referred to that point. At the time we argued that delay would lose the momentum and enthusiasm of the many people who supported the idea. We said that the best people to monitor the trusts and ensure that they were working effectively were the people standing on the sidelines who wished to become second and third wave applicants. Given the great enthusiasm that has been shown and the number of applications that have been made, we have been proved absolutely right.

As regards evaluation and monitoring of what has been going on, we want to avoid unnecessarily increasing bureaucracy, so we have a small unit at the centre as part of the National Health Service Management Executive. It is part of the role of the Management Executive to monitor all the activity within the National Health Service. We are developing that unit, as my right honourable friend's Statement described, by establishing zonal units throughout the country. We have the benefit on the medical front of the clinical standards advisory group monitoring the resulting clinical standards. Most importantly, as I said, we have the second and third wave applicants standing on the sidelines. Furthermore, there is the monitoring process which is made possible by the contractual system so that, in purchasing on an annual basis rid revising their purchasing requirements, the purchasers take into account the effectiveness and performance of those various units. In any event, annual reports will be published for each and every trust.

The noble Lord, Lord Ennals, asked about business plans for second wave candidates. Those reports are not due to be prepared until next spring and will then be published. The Coopers and Lybrand reports are confidential to my right honourable friend the Secretary of State and contain confidential commercial information. It would therefore not be proper to publish them more widely. They include issues such as potential land sales, which everyone recognises as being important in terms of confidentiality.

As to the administrative costs, this is an unsubstantiated allegation by the BMA. Although I welcome the fact that many of the BMA's members consistently make clear that they support the concept of National Health Service trusts, I must point out that the Government have certainly consistently spent more on health than the previous Labour Government.

The suggestion that trust status is being forced is absolute nonsense. Doctors and staff are increasingly supporters of the trust status. No obligation is put on any individual unit to apply to become a trust. Trust status is an entirely voluntary activity. As for the suggestion that the trusts are part of any kind of creeping privatisation, the Government have enabled more patients than ever before to be treated on the National Health Service. That must be good news. In that context the suggestion of the noble Lord, Lord Ennals, that many patients are being forced to go private is nonsense. If he cares to study the scene he will find that the private sector itself is worried that the vastly improving services being provided under the National Health Service are causing difficulties for it.

It is very interesting to note on an international comparison basis that because of the effectiveness and efficiency of our National Health Service—which we are currently making more effective and more efficient—fewer people choose to use private sector services than in any other country in the EC whatever their shade of government. All told, I believe that we have here a very happy picture and we look positively toward the future.

Perhaps I may say one final word to the noble Baroness, Lady Robson, who raised the matter of London. It is widely accepted that changes in the structure of London's health services are long overdue. We believe that the effect of the reforms has been to bring the issues into sharper focus and uncover what we call the London paradox; namely, the fact that more resources are available for London patients but there are fewer services than for patients in the provinces.

Sir Bernard Tomlinson and his team will take a strategic look at the issues and be a source of independent advice to my right honourable friends the Secretary of State for Education and the Secretary of State for Health. They will be invaluable in helping to take the key strategic decisions about the future pattern of health provision and medical teaching in London. London is not starved of resources but we need to work carefully to ensure that all the specialist services and the factors of education, research and management are taken into account. We shall benefit from the valuable advice given by the experienced person who has been appointed for that task.

4.12 p.m.

Lord Glenarthur

My Lords, perhaps my noble friend will accept from me an endorsement of the fact that many who work in the National Health Service will wholeheartedly welcome the Statement which she has repeated. They will do so not from any party political perspective, as appeared from the manner in which the noble Lord, Lord Ennals, condemned the Statement, but because the Statement spells good news for them. They hope to achieve a better throughput of patients, better use of resources and hence better quality services as well as more accountability from those who are responsible for the delivery of the service to those who need it.

I shall put to my noble friend two questions about the four London teaching hospitals, which will welcome the news that they are to be granted trust status in April 1993, subject to any recommendations of the Tomlinson Report. I immediately declare an interest as (at this stage) the prospective chairman of St. Mary's, Paddington. Can my noble friend say when the non-executive directors of the trusts will be formally appointed and when the shadow trust status in an advisory form, or whatever, is likely to be brought into effect? Can she also say a little more about the nature of the devolved management to be given to those hospitals? If she cannot do so, can she perhaps ensure that any decisions on this matter are promulgated as soon as possible?

Baroness Hooper

My Lords, I am grateful to my noble friend for showing a very positive attitude and emphasising the enthusiasm that exists at the place where responsibility properly lies; namely, at the grass roots of our National Health Service. On the matter of timing, my right honourable friend the Secretary of State will be writing immediately to ask the non-executive assistants to work with those hospitals from November this year in order to prepare for trust status. They need to work closely with their respective district health authorities, which will continue to be statutorily responsible for the hospitals. I hope that that responds to the questions raised by my noble friend.

Lord Hunter of Newington

My Lords, in the light of what the Minister said, will she be good enough to tell us how the Government see the future of regional and district health authorities?

Baroness Hooper

My Lords, the future of district health authorities is clear. They are the bodies which are responsible for providing health care for all the people who are resident within their district. They have the responsibility of entering into contracts with both the directly managed units and National Health Service trusts within their district, and indeed when necessary outside. The role of the districts has changed to the extent that they are no longer involved in on-the-ground management of the hospital units. But they have a clear responsibility to ensure the provision of services for the people living in their area. The role of regions will remain important in terms of co-ordinating activity and covering financial needs within their wider areas.

Lord Stoddart of Swindon

My Lords, perhaps the Minister can help me with a couple of points. She said that trust status was a voluntary activity and that it was welcomed. How does she test the feelings and views of the people in the localities where hospitals are to be given trust status?

My second and related question is to ask what kind of consultation takes place in the hospitals, not only between management and government but between management, government, trade unions, doctors, nurses and other staff? Is it formal consultation, or can she say exactly how the views of all the staff concerned are gathered and taken into account?

Baroness Hooper

My Lords, clearly the views of the people working within a particular unit are vital for the wellbeing of the unit and its future efficient operation. It is for the people who make the application on behalf of that unit to ensure that all bodies and categories of individuals have been involved in the consultation process. Indeed, that is something which the Secretary of State takes into account when considering applications and ascertaining the benefit of granting such status to any unit. The recent BMA study showed that, from a sample of 43 hospitals in which consultant medical staff were balloted about support for the unit to pursue NHS trust status, a majority of consultants supported the application. The study rejects what was said about the level of support for trust status for clinicians. I should add that there was one expression of interest from the Devon Ambulance Service Unit where NUPE was very much in favour of such status. That rather proves that unions also take part in this process.

In addition, there is public consultation. The large responses to public consultation exercises centred on ballots of the local population—which are often masterminded by local branches of political parties and couched in terms such as, "Do you agree to your local hospital opting out of the National Health Service?"—can result in misleading and wrong effects. However, there has been wide public consultation although it varies from unit to unit.

Lord McColl of Dulwich

My Lords, I congratulate my noble friend on the splendid news of more hospitals becoming self governing. Perhaps I may thank her very much for making it possible for Guy's and Lewisham hospitals to become a self-governing trust because we have some marvellous news. Since 1st April, by implementing our business plans, we have been able to save £6 million, at the same time treating 12 per cent. more patients.

With regard to the comment of the noble Lord, Lord Ennals, about the Government promoting private practice, does my noble friend agree that the greatest encouragement to private practice was given inadvertently by a Labour Government in the 1970s in their attempt to reduce private practice when at the same time the trade union movement was taking out contracts to enable its members to have private treatment?

Does my noble friend also agree that an Opposition spokesman in another place has thrown a flood of light on what she means when accusing the Government of privatising the NHS? She stated that what she means is that, for instance, where previously patients could have free eye tests, they now have to pay. But who were the villains who in 1951 first introduced prescription charges after a Labour Government lasting for six years?

Baroness Hooper

My Lords, my noble friend makes a most interesting point. Who indeed was it who introduced prescription charges in the first place? On the important point about the progress being made in the Guy's and Lewisham Trust, it is clear that the management team has had to tackle problems that had built up over a number of years. It has had the energy and enthusiasm to do so and the figures quoted by my noble friend prove that it has been successful in the action taken.

The Earl of Onslow

My Lords, does the Minister agree that within the European Community, and indeed Western medicine as a whole, the British health service has the lowest element of private practice; that we probably receive better value for money than most others; and that what the Government are doing through their practice and research for greater efficiencies is common to all medical systems in the Western world? The Government should therefore be encouraged to continue along the line that they take at present.

Baroness Hooper

My Lords, my noble friend makes a valuable point. Last week I was in the Netherlands attending a conference of European Community health ministers entitled Critical Choices in Health Policy. We all have the same problems, in part caused by increased technology but also by the demographic factor of an explosion of demand and therefore an explosion of cost. There is need therefore to be very sure of our priorities. It is perfectly true that our National Health Service is such that the private sector is the least used among European countries.

Lord Winstanley

My Lords, since the Prime Minister said that there should be greater co-operation between the private sector of medicine and the National Health Service in Britain, will the Minister confirm that the private sector in Britain faces difficulties which are every bit as great as those faced by the National Health Service, as any member of a private body will know from the amount of small print on his membership documents?

Baroness Hooper

My Lord, yes. The explosion of demand and explosion of cost clearly equally affect the private sector. We clearly wish to have choice in this country; we want a viable private sector running alongside the National Health Service. However, the increased efficiency of our National Health Service is really putting those private bodies on the line.