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Coalition government


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From: The Socialist issue 672, 25 May 2011: Unite to stop the cuts

Search site for keywords: NHS - Health - Privatisation - Coalition government - Cuts - Trusts - Hospital

Battling to defend the NHS

March to save the NHS 17 May 2011 , photo Paul Mattsson

March to save the NHS 17 May 2011 , photo Paul Mattsson

In the Con-Dems' Health and Social Care Bill the NHS faces a serious attack on its very existence. But the huge anger the Bill has inspired is putting massive pressure on the coalition government. Here health workers and activists explain the processes of cuts and privatisation, what needs to be done to defend the NHS and some of the obstacles that need to be overcome.

The Con-Dems know how to bury bad news. On the day when almost every spare TV camera and journalist was on royal wedding duty, NHS cuts of up to 37% were announced. This will drive hospitals to bankruptcy.

'Monitor', appointed to regulate NHS Foundation Trusts, wrote to Trusts with revised figures for "efficiency savings". These were previously 4% a year until 2014/15 - a figure cooked up by the Labour government. The savings demanded will now be 6.5% this financial year, 6.0% next year, rising to 7.1% by 2015/16 - equivalent to a 37% cut by then.

Higher inflation is one reason for this massive extra cut. NHS costs tend to rise faster than other prices, partly because of the profiteering of drug and medical supplies industries.

Another reason is new rules that mean Trusts will not be paid for patients re-admitted within 30 days of discharge. The Labour government figures assumed Trusts would reduce re-admissions within 30 days by 60%. In fact, they have grown by 4% a year over the past three years. That reflects another pressure on hospitals - to discharge patients quickly and get payment for the next patient. This is so-called payment by results, supposedly increasing productivity.

The previous figures also assumed emergency hospital admissions would not grow after 2012/13. Monitor now expects this figure will continue to grow by 2% a year, as it has done over the past three years.

Tens of thousands of health workers' jobs will disappear if these cuts go through. Staff are run off their feet now. Fewer nurses, porters, technicians, secretaries - these cuts will hurt patients.

At Sherwood Forest Hospitals NHS Trust in Nottinghamshire, for example, 420 whole-time posts are threatened this year to meet the original 4% 'efficiency saving'. (That means even more jobs, as many staff work part-time.) That's about one in nine whole-time equivalent posts.

Privatisation

March to save the NHS, photo Paul Mattsson

March to save the NHS, photo Paul Mattsson   (Click to enlarge)

Like many other Trusts, Sherwood Forest's situation is aggravated by the high costs of the Private Finance Initiative (PFI) hospital building. Skanska and Innisfree, the two companies owning the new Kings Mill hospital, have to be paid before a penny is spent on patient care. At 2005 prices, when the PFI scheme was set up, the new hospital has cost 299 million. It was to be an 840-bed hospital, but, completed in the past few months, it has 623 beds.

As well as building and owning the hospital, Skanska Innisfree, along with Medirest (part of Compass), supply 'hard facilities management' (estate maintenance) and 'soft facilities management' (hotel services like cleaning and catering). The combined annual cost is likely to be about 6 million at last year's prices. Over the 32-year contract that's nearly 200 million.

So the building cost 300 million and the facilities management another 200 million - 500 million in total. But the NHS will pay 1,091 million over 32 years (at 2005 prices). The financial books should be open to inspection by trade unions and local community representatives. Let's see if these estimates are accurate and where public money is going.

No wonder that Innisfree's profit margin was 53% last year. David Metter, its founder and chief executive, owns almost three-quarters of the company and collected pay and dividends of 8.6 million last year.

Sherwood Forest Hospitals is a Foundation Trust like many others. This Labour measure sent Trusts down the path that leads towards eventual privatisation. Foundation trusts can enter joint ventures with for-profit companies and distribute 'surpluses' to these companies. Freed from direct accountability to the Department of Health, let alone to the local community, they can raise commercial loans without restriction.

Their only accountability is to the regulator, Monitor. But who is Monitor? Set up by Labour, its new chief executive is David Bennett. He was a director with McKinsey and Co, international business consultants who have made a fortune from advising governments about cuts and privatisation. He then worked as Tony Blair's head of policy and strategy between 2005 and 2007. After that he was chair of 'The 10 Partnership' - a company providing "strategic and operational support to the public sector".

In March, Bennett told the BBC he expected to see many more private companies and charities treating NHS patients. He made clear that if NHS services cannot then attract patients they will be allowed to close.

Big business parties

March to save the NHS 17 May 2011 , photo Paul Mattsson

March to save the NHS 17 May 2011 , photo Paul Mattsson   (Click to enlarge)

There are about 85 NHS hospitals and mental health trusts that have yet to become foundation trusts. The government aims to have all of them reach that status by April 2014. Last year, when Monitor's 'efficiency' savings target was 4.5%, only seven organisations met its standards for approval.

Now it's demanding 6.5% savings, Monitor makes it more likely that struggling NHS organisations will be offered to private companies rather than merged with existing foundation trusts.

The government wants to see a level playing field between the NHS and anyone else bidding to treat patients. H5 is a new alliance, representing the biggest companies with 80% of private hospitals. It is lobbying Monitor to remove the 'disadvantages' they claim stop them competing equally. Ending national pay bargaining and the NHS pension scheme are two targets in their sights. (They are not lobbying for an end to NHS education and training, despite using skilled staff trained at tax-payers' expense.)

Matt James, the chief executive of H5, said the government plans to build on changes introduced under Labour but which languished during Gordon Brown's time as prime minister. They certainly were not reversed by Brown. How can Labour oppose the Con-Dem plans when it set so many of them in motion?

But a new mass party, made up predominantly of working class people and which fought in their interests, including to defend the NHS, would have a huge effect in giving confidence to those struggling against the attacks of big-business governments.

Jon Dale, health worker

Dr Jackie Grunsell was a Save Huddersfield NHS campaign councillor, photo Alison Hill

Dr Jackie Grunsell was a Save Huddersfield NHS campaign councillor, photo Alison Hill

Last week I attended a Royal College of General Practitioners (RCGP) conference on 'Working with drug and alcohol users in primary care'. The conference took an unexpected turn with the introduction by the first platform speaker, the chair of the RCGP.

From the start she expressed concerns about the government's Health and Social Care Bill and its likely impact on services provided to this particular group of patients. In fact an impromptu vote was taken. Delegates were asked to show if they felt the Bill would improve patient care and reduce health inequalities. Of the 350+ audience, just three people raised their hands! All other delegates were clear in their condemnation of the plans.

Not content to leave it there, one desperate delegate, representing a private sector organisation, asked: "Can't we work together? Is it really a case of private sector bad, public good?" The chair did not mince words in questioning what the private sector had to add that the NHS couldn't already do. Especially as they don't do training or research and get to cherry pick and cream skim the services they provide. This is on the basis of an uneven playing field heavily weighted in the private sector's favour.

The chair described her fear that a 'national' health service will cease to exist, to be replaced by a postcode lottery of fragmented local provision leaving Cinderella services like drugs and alcohol and mental health, particularly vulnerable and exacerbating the inequalities that already exist.

She was clear that a universal health service would be abolished by the bill, leading to the creation of a system based on health insurance, with patients being asked to pay top up fees for anything over and above the basics the NHS will be able to offer.

The significance of this conference was that one platform speaker after another joined what became an anti-Health Bill rally and powerfully illustrated the huge opposition to the government's plans among the majority of health professionals. It even agreed to send a conference statement to the health secretary outlining the views expressed.

A taste of the opposition to come if the Con-Dems plough ahead with the Bill, ignoring the opinions of these workers?

Dr Jackie Grunsell

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