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§ Mr. Eric Illsley (Barnsley, Central)
I am grateful to have an opportunity to discuss the funding of Barnsley district health authority, which is of great concern to many of my constituents and to parliamentary colleagues in this Chamber this morning. I want to concentrate on what appears to be the low level of funding allocated to Barnsley district health authority, in contrast to the area's needs. That is not a new issue; it has not arisen overnight, this year, or recently. It has been of concern for many years, so it is not an issue for which this Government alone must take responsibility. Barnsley has been for many years one of the lowest funded health authorities in the whole country. I am probably right to say that, for a considerable period, we were the lowest funded health authority in the country, despite greater health problems and inequalities than many other areas, especially those in close proximity with similar problems. Barnsley's history at the centre of the Yorkshire coalfield has left a legacy of disability. A large proportion of households in Barnsley borough about one in three—have one member of the family with a disability. Other acute needs are also made worse by the funding shortfall.
I want to consider funding in some detail. It is a complicated issue, which I do not profess fully to understand. I shall keep the figure as simple as possible. As hon. Members will probably be aware, health authority funding is expressed as an actual figure, in terms of money available, and as what is known as a percentage from target. For example, the target figure is usually expressed as 100, so the percentage figure is above or below 100 depending on whether there is underfunding or overfunding for the particular health authority. Barnsley is consistently underfunded. In 1997–98, Barnsley's percentage figure below target was 97.37 per cent., while in 1998–99 it fell to 94.76 per cent. In 1999–2000, the figure rose to 97.02 per cent. However funding for the forthcoming financial year–2000–01—is a decrease to 96.89 per cent.
It appears that Barnsley is falling further and further away from the target funding of 100 per cent. The figure of 96.89 per cent. makes Barnsley the worst-funded health authority in the Trent regional authority, which comprises 11 others. However, according to the indicators used by Trent regional authority—morbidity, coronary heart disease, cancer, stroke and other indicators—Barnsley has the worst problems in Trent. We have what I perceive as the greatest need, but we appear to be falling behind in relation to funding.
I said earlier that the problem has persisted for several years and that the present Government should not bear sole responsibility for the funding that is available. For the forthcoming financial year 2000-01, Barnsley's funding allocation is £168.14 million. That involves a cash uplift of 7.62 per cent., which compares favourably with a national average of 6.78 per cent. and which is the highest cash uplift in the Trent region. However, in relation to authority funding in the Trent region, Barnsley is still at the bottom of the pile, and we are moving further away from the target funding. We are one of the lowest-funded health authorities in the country. We are in a sorry position—we cannot find 11WH solutions to the problems that we have identified, let alone attempt to pursue health prevention initiatives that involve, for example, changes in life style and diet.
The situation was highlighted on national television recently, and that coverage was discussed in our local press. We witnessed the unfortunate headline "Barnsley on the sick list". The article stated:Barnsley was today named as the worst health authority in South Yorkshire.The first league table marking performance was based on death rates from cancer and heart disease… and deaths from "avoidable" diseases such as TB and asthma.Barnsley was ranked 102 out of 120… Experts said the league table showed that some of the country's most deprived areas had the worst healthcare provision.That is our problem—we are one of the most deprived areas but our health care provision is one of the poorest in the country. We do not seem to be able to access the funding that we need to correct the situation.
The report of the health authority finance officer, which was submitted to the health authority on 22 February, highlights some of Barnsley's problems. The report stated that following the financial settlement:The forecast year end outturn… showed a projected underspending of £195,900 compared with the previously predicted significant overspend.That forecast outturn has been improved because an "additional allocation of £736,000" had been made availableto the Authority in respect of generic prescribing and the identification of further sum of £421,000 of further slippage within the reserves… The forecast year end outturn took no account of the £800,000 borrowings which the Authority had been required to negotiate and which would form a first charge on its allocation for 2000–01.That means that the authority has a year-end deficit of about £1.2 million.
We have gone from facing a considerable overspend to facing an underspend of £200,000, although there is a first charge of £800,000 on the authority's funding, and £400,000 has been taken from the reserves. The health authority's funding involves a deficit of £1.2 million for this year end. Why does Barnsley health authority have an underspend of £200,000 at the end of the current financial year when in reality it faces a considerable deficit?
I raised the issue of deprivation and health need in Barnsley when I met the chief executive of Trent regional health authority last year. The indicators and statistics that the authority uses were beginning to show Barnsley in a very poor light in terms of various categories of health provision—consistently the worst of the 11 authorities in the Trent regional health authority area. I have already referred to the television survey that ranked us 102nd nationwide.
Of the 11 authorities, Barnsley has the worst level of morbidity, in respect of every cause of death, for people under the age of 65. It has the worst record for lung cancer, cervical cancer, hypertensive and cerebrovascular disease and coronary heart disease, and for the early detection of cervical cancer and inappropriate surgery in respect of children's glue ear. Looking at that list, it is easy to see where Barnsley's 12WH problems lie, and the difficulties that it faces. I have referred only to the categories in which Barnsley has the worst record. Categories in which it is second worst include colon cancer and suicide, and the list goes on.
To make matters worse, there is only a narrow gap, in terms of health provision, between the best and worst areas of Barnsley. That suggests that problems extend throughout the borough; no area is better or worse than any other, and the situation is poor across the whole health authority area. I should point out that that is not the fault of the local hospital. A recent headline in the local newspaper, headlined "Praise for hospital", states:Hospital bosses in Barnsley have been praised for bucking a national trend by rarely cancelling operations.The health authority staff at the hospital have recently been singled out for substantial praise.
It is clear from the establishment of the South Yorkshire coalfields health action zone that some of Barnsley's problems have been recognised. Given the priorities that will be addressed by the action zone, I hope that the position can gradually be alleviated by encouraging people to improve their life style by changing their diet and so on. The question of low incomes and deprivation is a different kettle of fish, which can be addressed only by better economic performance in the longer term.
When I raised the matter with the director of Trent regional health authority last year, I pointed out that Barnsley is an area of extreme need in terms of health provision; it has a poor record and the least amount of money. He replied that the people of Barnsley have low aspirations and are reluctant to complain. I suggested to him that if I start to tub-thump and shout about it, his budget situation will deteriorate, because I will make people aware of the situation that they face and the fact that they should be demanding more from their health authority, but the money is not available. He was inclined to agree, which surprised me. More should be done to equalise funding across Trent regional health authority to try to alleviate Barnsley's problems.
I shall refer to a couple of other problems that Barnsley faces. We have recently lost accreditation for an ear, nose and throat surgeon because we could not provide sufficient training opportunities for junior doctors and we contravened the rules on junior doctors' hours. We are also facing accreditation problems with orthodontic surgery, orthopaedic surgery, dermatology and general surgery.
There are major problems throughout the area with the prescribing of wrong drugs and too many drugs. Problems will also arise with the reconfiguration of health authorities in Barnsley, but they do not concern funding and I do not expect the Minister to respond to them today. I hope that any attempt to reconfigure the health trusts in Barnsley will not disguise the fact that our funding is low, but I have considerable reservations about that reconfiguration.
I refer the Minister to a letter that I received recently from the Barnsley local medical committee of general practitioners. There is an air of desperation in the letter which refers to funding being badged for various purposes but schemes and areas in Barnsley being desperately in need of development with no funding to allow diabetic and cardiology services, both of which are 13WH Government priorities, to be pursued. Dr. Kenneth McDonald, secretary of the committee, concludes his letter by stating:It feels very much as if we are being penalised for achieving financial probity in an area where there is a large amount of socio-economic deficit leading to considerable medical problems that as GPs we are very keen to address, but are hamstrung due to funding deficit.I look forward to the Minister's response and hope that she can give me some hope for the future.
§ The Parliamentary Under-Secretary of State for Health (Yvette Cooper)
I thank my hon. Friend the Member for Barnsley, Central (Mr. Illsley) and congratulate him on raising the debate on the funding settlement for Barnsley. My ministerial colleagues and I are aware of local concerns about past and current funding for the district. His constituents will be aware of his hard work and that of his colleagues in Barnsley to ensure that the area receives better health care facilities in future.
We have backed our commitment to the national health service with significant additional resources for the NHS in England of £1.9 billion during our first two years in government and, from the comprehensive spending review, almost £18 billion during the next three years. That represents the largest ever cash injection into the NHS.
In December, my right hon. Friend the Secretary of State for Health announced total funding of £34 billion for England's health authorities for 2000–01. That represents an average cash increase of 6.8 per cent., which is a rise of 4.2 per cent. in real terms. Those resources are additional money for modernisation and to help to create the fast, fair and convenient health services that people expect. They will also tackle health inequalities, which my hon. Friend described so clearly in relation to Barnsley.
I want to make a couple of points about the way in which we allocate resources nationally before turning to my hon. Friend's specific points about Barnsley. Funding is allocated to health authorities on the basis of the relative needs of their population. A weighted capitation formula is used to determine each authority's target fair share of resources so that similar levels of health services can be commissioned for populations with similar needs. The previous Government took account of the indices of need to the extent of only 80 per cent. when using the weighted capitation formula. The present Government, on the advice of the resource allocation group, increased the weighting in the formula to 100 per cent., increasing the account taken of deprivation because we want to tackle health inequality. That has already made a significant difference in Barnsley. The result was an additional £1.3 million added to Barnsley's target in 1998–99. We also need to make progress towards that target, which is exactly what we have been doing during the past few years.
The weighted capitation formula is used to set the targets, which then inform the allocations. It depends on factors such as additional need indices, which contain health and socio-economic variables. It is based mainly on work by York university to investigate the link between social and economic circumstances and the use 14WH of national health service in-patient services. The formula itself does not determine allocations. Actual allocations reflect decisions on the speed at which health authorities are brought nearer to targets, through the distribution of extra funds. The pace of change is decided annually—by Ministers for health authorities, and by health authorities for primary care groups. The key decision in pace-of-change policy is how extra resources should be deployed between across-the-board increases to maintain continuity and stability and differential distribution to bring under-target health authorities such as Barnsley closer to their target allocation.
To satisfy those objectives, all health authorities have in recent years been given real terms growth. The additional funding has been distributed to target those health authorities that are furthest from their fair distribution of resources. All health authorities were given a minimum cash increase of 6.2 per cent. for 2000–01. To supply the extra resources needed by under-target health authorities, the average cash uplift was 6.8 per cent., although the highest cash increase allocated to under-target authorities was 8.5 per cent.
My hon. Friend was right to say that, as a result of decisions made by the previous Government, Barnsley district health authority started well below its fair share of resources. To bring Barnsley up towards its fair share, it is receiving above average increases each year. Its allocation per head is £719 per person, compared with an average per head, across the country, of £675 per person. Barnsley therefore receives more per person than the average.
As my hon. Friend and I agree, that is not the right way to make the comparison. Once health needs are taken account of, Barnsley has not been given its fair share. Under the previous Government, the formula did not fully reflect deprivation. We have made progress towards the target with an increase of 7.8 per cent. this year, compared with a 6.6 per cent. average increase. In 2000–01, there will be a 7.6 per cent. increase, compared with a national average increase of 6.8 per cent. As my hon. Friend mentioned, that is the highest increase in the Trent region. He is right to say that we need to go further, and sustain above average increases in future for the population of Barnsley.
My hon. Friend mentioned the growth in the percentage gap between the actual position and the target in 1999–2000 and 2000–01. In fact, that reflects an accounting change, rather than a change in resources for services. As he is aware, Barnsley has had above average increases, but there has been a technical change to the baseline because of a revaluation of the NHS estate. The baseline for Barnsley, as a result of that revaluation of capital and estate, is lower. That is not because of lower resources for services, or additional resources for services for other areas. It is simply about a revaluation of the baseline. That makes clear Barnsley's continued need for above average increases in future. Those increases must be sustained to tackle the health inequalities that he mentioned.
Concerns have been expressed about how well the current formula matches NHS cash to health need. A new formula is required that reflects the way in which the new NHS is managed and uses resources. The Advisory Committee on Resource Allocation is currently overseeing a wide-ranging review of the 15WH formula. The review is in its early stages. We expect a progress report, which is a major undertaking, in about a year. We have therefore frozen the current formula to maximise stability and certainty for health authorities, while the review takes place.
My hon. Friend referred to Barnsley health authority's financial position. I am aware that at the end of January 2000 it forecast a small deficit of £315,000 and that it expects to carry an underlying deficit into the next financial year, as a result of GP prescribing and mental health out-of-area placements. The additional cash uplift for 2000–01 will contribute significantly to reducing that deficit, but I understand my hon. Friend's concern. The health community is in continual discussion about its financial position and is endeavouring to bridge the gap without falling short of service targets. The outcome of its work will be discussed with the Trent regional office of the NHS executive in early March.
My hon. Friend correctly identified prescribing as one element in Barnsley's financial situation. That will be a key issue for the health authority next year as well. As for all other health authorities, the price increases in generic medicines last year caused a major problem, although it has been mitigated in the current financial year by an additional allocation to Barnsley of £736,000.
My hon. Friend is aware that Barnsley's prescribing performance has not been of the highest standard. I share his concern that, in three of the Audit Commission's four indicators for prescribing performance, Barnsley ranks the lowest in England. The reasons for the poor performance are complex and reflect Barnsley's long-standing problems with the provision of primary care.
A range of actions has been put in place to tackle poor prescribing performance. The health authority has allocated resources to employ prescribing support to pharmacists in both its primary care groups. The pharmacists will work with the PCGs and individual practices to promote more cost-effective prescribing.
Among the health authority's targets for improved prescribing performance is a 25 per cent. reduction in benzodiazepine prescribing and a 7 per cent. increase in generic prescribing in 2000–01. A reduction in benzodiazepine prescribing is strongly desirable on clinical grounds, as there is broad consensus that its use should be kept to a minimum. The Trent regional office of the NHS executive is monitoring the health authority closely to ensure progress on these issues.
16WH However, my hon. Friend will be aware that Barnsley's difficulties require more than simply a fair funding formula. We must modernise services and tackle the root causes of ill health. In July 1997 my right hon. Friend the Member for Holborn and St. Pancras (Mr. Dobson) invited Sir Donald Acheson, a former chief medical officer, to undertake a review of health inequalities in Britain. That report was a landmark that placed health inequalities firmly on the national agenda. It covered their deep-rooted causes, not only the upstream causes such as poverty, unemployment, low skills and poor housing but the downstream causes such as smoking, diet and exercise. My right hon. Friend was right to point to the higher mortality rates in Barnsley. Although death rates from coronary heart disease are declining, there is an upward trend in suicides.
The Government are committed to reducing those inequalities by taking action on a broad front: the minimum wage will help those on low incomes, and the working families tax credit and increases in child benefit will help to counter poverty. We shall also deal with poor housing and the broader coalfield issues that my constituency shares with my hon. Friend's. We also want to tackle directly some of the downstream causes of health inequalities, particularly in coalfield areas and in Barnsley.
My hon. Friend is aware that Barnsley, Rotherham and Doncaster comprise the South Yorkshire coalfields health action zone. Indeed, it was one of the first wave of HAZs launched in 1998 to tackle health inequalities in an area ravaged by pit closures and industrial decline. The HAZs are testimony to our determination not simply to look at the funding formula for the services provided to people once they have become ill but to tackle the root causes of ill health in areas like Barnsley. In its first year, the coalfields health action zone received additional funding of £520,000 from the main programme; in the current year, it has received £3.3 million as well as £100,000 in development money. Barnsley's share has been £918,000, which will enable it to put in place a range of initiatives to tackle the root causes of ill health.
I understand my hon. Friend's concerns about resources in Barnsley. The Government are working to tackle such health inequalities by increasing the fair-funding formula that is distributing more resources to Barnsley, by giving additional resources for health promotion and the prevention of ill health through health action zones, and by modernising health services.