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Foundation Hospitals

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From: The Socialist issue 299, 10 May 2003: No To Foundation Hospitals

Search site for keywords: Foundation Hospitals - Hospitals - NHS - Privatisation - Health

No To Foundation Hospitals

YES to good quality health care for all

Stop NHS privatisation

AS A UNISON steward I oppose Labour's plan to create foundation hospitals. This is merely privatisation by the back door and will lead to a two-tier health service.

John Malcolm, assistant branch secretary, UNISON North Tees mental health, personal capacity

North Tees and Hartlepool NHS trust, which covers the area where I live and work, could be one of the first to apply to apply for foundation status.

According to a recent report the trust has a 4 million budget deficit and is looking to make cuts, and this follows a range of cost cutting 'initiatives' by the trust board.

It does not give me much confidence that foundation status will improve the situation. The trust will be in competition with another local hospital where a massive Private Finance Initiative (PFI) scheme has recently been developed with a range of specialised services.

At one stage, over 130 Labour MPs opposed the plans - but Health Minister Alan Milburn says he will press on regardless, refusing to even debate the issue with the unions.

The issue of foundation hospitals, along with PFI, makes the issue of the unions political funds a priority.

UNISON's funding of New Labour by 2 million a year should be stopped. This money could be used to campaign against New Labour's damaging cost-cutting plans for the public sector and to fund parties and individuals prepared to oppose Blair's big business agenda.

Foundation hospitals: Privatising the health service

New Labour's plans for foundation hospitals produced a significant revolt within Labour's ranks in the run-up to this week's parliamentary debate. The socialist looks at what's behind these plans and puts forward a socialist programme for the health service.

TONY BLAIR tries to justify New Labour's plans for foundation hospitals by harking back to the foundation of the NHS in 1948, when working class people finally won access to health care, free at the point of use.

The establishment of the NHS was a tremendous victory for the working class but the system wasn't perfect then and certainly needs reform now. But not the type of 'reform' he has in mind - the UK already spends a smaller proportion of GDP on health than almost all other advanced countries.

So what are foundation hospitals?

The original plans were for hospitals scoring highly in the government's league tables - those with three stars - to be eligible to apply for foundation hospital status, with effect from 2004. 32 have applied so far. But Tony Blair and Alan Milburn have already had to pledge 200 million to help all hospitals achieve foundation status within five years, to try and counter the "two-tier health service" accusation.

Foundation hospitals will be able to set their own clinical and financial priorities, raise money on the open market and ultimately set separate pay and conditions for staff. They will be able to develop as centres of excellence for certain diseases and conditions and sell their knowledge and expertise abroad and to other hospitals.

There will be nothing to stop private hospitals applying to become foundation hospitals or foundation hospitals 'outsourcing' some or all of their services to the private sector.

All foundation hospitals will implement the Agenda for Change proposals, which do nothing to address the problems of low pay in the health service (see below). Some low-paid workers will actually be worse off, whilst senior managers can be paid more.

The cheer leaders for these plans make much of the idea that foundation hospitals will be more accountable to the local community.

"This initiative is not about privatisation versus nationalisation, it's about localisation. I don't think it is as controversial as some people believe" says Mark Britnell, chief executive of University Hospital Birmingham.

The hospitals will be run by a board of governors, unlikely to be any more democratic or representative of local communities than the current trust boards. But they will have to work through a management board, which will be responsible for budgets and pay, amongst other things. Each hospital will set out its own constitution - nowhere is it made clear how these arrangements can be more democratic or responsive to local needs.

The hospitals will be able to borrow money on the local market, not subject to treasury approval. But if a foundation hospital goes bankrupt it will be baled out with public money, like the railway companies.

Healthy future?

Socialist Party member Ciaran Mulholland has recently produced a report on the proposed reorganisation of hospitals in Northern Ireland. In his report A Healthy Future? (see below) he sums up what is clearly behind hospital centralisation and privatisation across the NHS and across Europe.

The ideology driving these measure is that demand for health services is infinite and can never be met. That resources are limited and will never be enough, so 'change' is inevitable. 'Change' means increased centralisation (with the closure of smaller hospitals) as larger hospitals are both safer and more cost effective. And 'change' means increased privatisation as the private sector is considered more efficient and cost effective, and can inject resources which are not available to the public sector.

Essentially the foundation hospitals proposals are a desperate attempt to show quick returns for the increased spending which has taken place in the health service. They attempt to conceal the fact that this spending is woefully inadequate to repair the damage from years of neglect by talk of "democratisation" and "accountability".

So the only way forward is more privatisation, more cuts and now this scheme which will restrict the best quality hospital provision to those living in the right areas and those able to pay.

As an article in the British Medical Journal said in 1999: "The planning process has effectively been reversed with services being designed to fit predetermined reductions in capacity. The high costs of the PFI entail major reduction in service provision, acute bed capacity and clinical staffing. Justifying these reductions, it would seem, has become the main planning task."

A Healthy Future? By Ciaran Mulholland, available from Socialist Party, 36 Victoria Square, Belfast, BT1 4DQ, tel: 02890 232962 or

A socialist programme for the NHS

The real costs of privatisation

ONE OF New Labour's earlier flirtations with the private sector in the NHS was the 'concordat' with private hospitals. NHS waiting lists were to be cleared by hiring surgeons in private hospitals. But to nobody's great surprise The Observer has revealed that NHS hospitals are being ripped off by private hospitals charging at least double what the operations would cost on the NHS.

Replacement hips and knees for example cost under 5,000 in big cities and under 4,000 in other areas. But in one case, GPs in Somerset were being charged 7,200 per operation.

Yet foundation hospitals will actually promote the use of more private facilities and more super-profits for the private hospital companies.

A SCHEME designed to save up to 500 million a year in NHS administration costs has been dumped because of the foundation hospitals scheme. The national shared services initiative was designed to improve the efficiency of hospital administration by adopting common methods of carrying out financial procedures. This was supposed to have allowed hospitals to gain from pooled experience and the most advanced IT methods.

These are bold claims, which may not have been realised in practice but we'll never know because the scheme has been dropped so the foundation hospitals can have more freedom to run their own finances.

We can look forward to a massive increase in administrative costs - like when the Tories introduced the internal market into the NHS - as each hospital tries to run its own systems.

THE NATIONAL Audit Office has found that over a third of all NHS trusts believe that they have little control over private contractors' safety.

NHS trusts are using contractors more and more, particularly cleaning, security and catering. But 21% of trusts were not able to provide details of the number of contractors working on site.

Increased sub-contracting is causing confusion about who is responsible for health and safety, so staff could be placed in greater danger.

A general union, GMB spokesperson said: "It is unacceptable that people's lives could be put at risk due to private contractors cutting corners on health and safety.

"NHS services should not be contracted out but where they are, the private companies should be monitored and made accountable for health and safety."

The NHS pay scandal

AGENDA FOR Change (AFC) does nothing about low pay in the NHS. Some workers will even have their pay cut.

Brian Loader, NHS Logistics UNISON steward, personal capacity

Those on protected pay will not get any annual cost of living rises after the three-year pay deal, until fellow workers' pay catches up. This could take five years. After that they will immediately lose part of their salary if they are still paid more than their colleagues.

Too much is left to local negotiation, allowing foundation hospitals to develop their own pay and conditions.

Sunday and rest day overtime is reduced from double to a time and a half. There is no real increases in London weighting, on-call, shift and unsocial hours payments. Some hospital night shift workers, especially on weekends, will see their shift payments fall from 30% + to a maximum of 25 %.

AFC also seeks to 'harmonise' the working week to 37.5 hours, with a staggered increase over seven years for anyone on 35 hours. Ambulance workers on 42 hours are excluded for this harmonisation.

UNISON health conference voted to ballot on implementing pilot schemes of AFC. The ballot starts in a few days.

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The coronavirus crisis has laid bare the class character of society in numerous ways. It is making clear to many that it is the working class that keeps society running, not the CEOs of major corporations.

The results of austerity have been graphically demonstrated as public services strain to cope with the crisis.

The government has now ripped up its 'austerity' mantra and turned to policies that not long ago were denounced as socialist. But after the corona crisis, it will try to make the working class pay for it, by trying to claw back what has been given.

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