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Mr. Jenkin: May I remind the hon. Gentleman that he welcomed the opportunity of having this debate, the proposed subject for which is

"Fundholding in a primary care-led National Health Service"? The hon. Gentleman can hardly blame my hon. Friend the Minister for discussing fundholding when it is the subject for debate. Is the hon. Gentleman proposing that the fundholders' advantages should be spread to all other fundholders, or that those advantages should be removed? Will he address that point?

Mr. McLeish: Conservative Members are rightly anticipating what I shall be saying in a minute, but I give the hon. Gentleman an assurance that he can intervene again if I do not return to that point.

A two-tier health service is a prominent part of the Government's agenda, as is private health care. In The Observer on Sunday 6 August, the Secretary of State for Health--who has been making soothing noises about the NHS--confirmed that he has private health care as a "safety net", and added:


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"My commitment as Health Secretary is to ensure that the service provided by the NHS is sufficiently good".

That is an admission that we may be on the verge of a safety net service under the NHS.

Mr. Malone indicated dissent .

Mr. McLeish: The Minister shakes his head, but we are used to that. The Government simply do not like the suggestion that their agenda is very different from the agenda of the British people, and, I believe, from the agenda of most GP fundholders, about whom the Minister waxed so eloquent today.

The Government are obsessed with GP fundholding to the exclusion of all else. An interesting letter appeared in The Guardian on 12 July, with the Minister being the subject of the discourse. The letter suggested not only that the Minister was obsessed with fundholding, but that he was making sure that his managers clocked up enough GP fundholders in the system so that they could get their bonuses and satisfy the Government's political objectives.

Mr. Malone: No.

Mr. McLeish: The Minister disagrees from a sedentary position, and I am willing to leave the matter there.

The Government will not come clean on their true intentions for the future of the NHS in the next century. Despite all the Government's concerns about primary health care, we have no doubt that, first, we have a two-tier health service and the Government are willing to continue to develop it; secondly, the Government are preoccupied with private health care as their first priority and the safety net NHS as their second priority; and thirdly, the Government will use every endeavour--above and below the table --to ensure that their political targets for fundholding are achieved.

Mr. Malone: I wish to put the Government's commitments firmly on record again. We are committed to the NHS as a tax-funded service that is free at the point of delivery. We are also committed to developing that service in the best way possible, something that the hon. Gentleman does not seem keen to do.

To suggest that there is some sort of private agenda is bizarre. The hon. Gentleman may like to ask some of the trade unions about private patient care, as they deliver private care as a benefit to some of their members. By talking about hidden agendas, the Labour party is getting into a bizarre world. I understand that the right hon. Member for Derby, South (Mrs. Beckett) recently became so excited about hidden agendas that she accused me of a having a hidden agenda of abolishing fundholding after the next election. However, I am glad that the right hon. Lady thought that I would be at this Dispatch Box after the next election.

Mr. McLeish: I have no vision at all of the Minister being at that Dispatch Box after the next election. Whether that cheers him up is up to him.

The Labour party is looking at primary health care and at the contributions made by GP fundholders and those involved in commissioning projects throughout the country. As politicians, we must build on the best. As politicians, we should want a service that provides for all patients and all doctors and in which exists the pluralism that the Government often talk about but never want to discuss in detail.


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We must address the many issues that the Government will not tackle, two of which are the equity of access to primary health care and the equity of funding. Labour's approach is based upon and will be informed by a vigorous debate about equity of access and equity of funding. The Government's greatest weakness on that matter is to assume that because between 40 per cent. and 50 per cent. of fundholders are providing a preferential service, they can simply forget about the 60 per cent. who are involved in other types of health care.

Mr. Mans: The hon. Gentleman has made an important point about equity of access. Does he agree that equity of access inevitably allows someone to have something only if everybody else has it at the same time? Does not that effectively mean that there will be a levelling down to the lowest common denominator, not a levelling up?

Mr. McLeish: I do not want to narrow expectations or narrow horizons. Why do Conservative Members always refer to levelling down?

Mr. Jenkin: Because of the Opposition's policies.

Mr. McLeish: That is a matter of debate.

The Opposition are talking about levelling up and building on the best that is currently available. To finish this part of my speech, I wish to raise a matter with the Minister. In Britain, we are seeing the Government putting in the building blocks for the privatisation of the NHS.

Mr. Malone: No.

Mr. McLeish: The Minister disagrees, but trusts and fundholding are the building blocks for future discussions on privatisation. That is in sharp contrast to the Opposition, who believe that we should be boosting a blueprint for the renewal of the NHS. I hope that those outside the House will understand that there is a fundamental divide between the Labour party and the Government on the future direction of the NHS. We say that the Government are not seeking to develop any part of the NHS for patient benefit. Instead, they have a long-term strategy to dismantle and disaggregate what has been built up over many years.

The Minister talked about fundholding and my constituency. Earlier this year my wife died suddenly. My GP practice is fundholding. There is an excellent bunch of doctors doing an excellent job. My wife's GP suggested that because she could not get a scan, she should go to hospital in Edinburgh. He said that as he was part of a fundholding practice, that could be delivered. I had no problem with that and neither did my wife. She was at the front end of an extremely serious illness.

My wife had a scan. When she went for it, she was completely healthy. Two weeks and five days later she died. I appreciated fully this year the benefits that GPs provide and the benefits that my GP practice was providing. But whether it was a fundholding practice or anything else, it was all too late for my wife. I appreciated the qualities and the benefits that the practice delivered. With great respect to the Minister, I do not need lectures from him. My passion and compassion are focused on trying to ensure that the very service that my wife received is received by all.


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Why should the service that my wife enjoyed not be available to and on offer by every other GP practice in my constituency? My approach to the health and primary care service is that we should build on the best. My wife and I had the best. She had the best in hospital. In her case, however, it was not enough. It is often useful that during our knockabouts in this place there is informed comment that is based on personal experience. I hope that the Minister accepts the spirit in which that comment is made.

Much has been said already about GP fundholding, but there are 95 groups and nearly 7,700 GPs serving 14 million patients by means of various forms of commissioning. We must take on board the problems, the issues and the innovations that come to light each day. The Labour party's approach is to build on the best of fundholding and commissioning. We are not saying to GPs in fundholding practices that important rights and important benefits for patients as well as important responsibilities for GPs should be discarded. Instead, we must focus on how best we can take things forward by combining the best of commissioning and of fundholding in a primary health care system.

I am sure that we, the Government and the Opposition will disagree on what the future should hold. The Conservative party should accept, however, that there is an alternative approach.

First, the benefits that have flowed to patients from both fundholding and commissioning should be recognised as constituting the important issue. Secondly, we, the Labour party, acknowledge the freedoms of GPs. It is their skills, commitment and dedication to the health service that motivate the entire system and produce improvements. That understanding must be acknowledged and embraced in any new programme. Thirdly, we must tackle unresolved problems. Fourthly, we must find a way forward that combines the two essential principles that fired the debate on 26 April 1948 in this place, which preceded the setting up of the NHS. Those principles were equity of access and of funding. Those core principles are applicable to the entire health service and to its continuation into the next century.

We, the Opposition, are putting forward a series of propositions. First, we say that the first priority of a Labour Government will be to develop commissioning proposals. We believe that they will prove attractive to all GPs. Secondly, GP fundholders will be absorbed into a new framework. Thirdly, GP fundholding will be eventually replaced by a new commissioning framework. Fourthly, we shall consult in detail with GPs about a realistic timetable for commissioning. That policy provides something that the Government's approach does not, and that is an opportunity for all GPs, whether fundholders or not, to participate in a system that ensures by means of a levelling-up process that the perceived benefits and freedoms of fundholding are available to everyone.

Mr. Malone: The crucial question is who will control the funds.

Mr. McLeish: With commissioning goes a number of other considerations that the Government sometimes ignore. First, we need collaboration among health authorities. It is-- [Interruption.] The Minister has turned away from me. I have obviously satisfied him by fully meeting his question. I shall continue, however, for the record.


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We are talking about commissioning, collaboration and partnership. The Government may not like those words, but it is obvious that those three approaches will be essential if we are to tackle some of the unresolved issues.

Mr. Jenkin: The hon. Gentleman has confirmed that in his commissioning framework he will remove the crucial advantage that fundholders have, which is exclusive control of the funds that they are allocated. The system in which he obviously passionately believes, bearing in mind what he has told the House, must embody fundholding control. Would it not be better for the hon. Gentleman to accept that we should be trying to extend that crucial control to all GPs rather than removing it and reducing what GPs can do for their patients?

Mr. McLeish: I fundamentally disagree with both the premise of the hon. Gentleman's argument and the conclusion at which he has arrived. If we are to have a detailed dialogue about the process that will enable us to have a commissioning framework, we must consider budgetary implications. It is important to recognise that the Government argue that all the benefits that have flowed from GP fundholding stem from budgetary control. In future, however, we must examine budgetary implications. We do not want to lose anything in the commissioning process that is of benefit to the patient and the doctor, and of benefit to the system generally. We propose to build on the best and to remove some of the excesses.

We, the Opposition, are confident that our policy will be a commonsense way forward. That will be the basis on which dialogue will take place. A recent speech by the Secretary of State for Health suggested that he is beginning to see things differently. When speaking to the Conservative political centre summer school in Cambridge, he said:

"There is no single blue print, nor has the government ever suggested that there should be. The important commitment is that there should be a determination to see the continued development of the family health services."

We agree.

The right hon. Gentleman talked about no preconceptions and no closed minds. We agree. We agree also that there should be no rejection of ideas because they were not invented by us. Instead, as he said, there should be

"a clear commitment to strengthening and developing the role of the family doctor."

I do not think that I have said anything with which the Secretary of State could disagree. If his speech at Cambridge signalled a change in the substance of the Government's policy, I welcome it. If it signalled merely a change of style, the right hon. Gentleman has much further to go before he arrives at where the Opposition are. Let us take up the issues that were not mentioned by the Minister, which to me are inextricably linked to the future of primary health care, whether it is a GP fundholding system or the system that we are advocating. We have already trawled the issue of equity, so I shall not discuss it in great detail. I am willing to accept that comments in the press by Ministers agree with my view that a two-tier mentality is developing. The Government may say that that should act as a push to go on to something else. We argue that at no stage should there be a two-tier system where people who live in one street get the benefits of a service, but people who live in another do not.


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We need to ensure that Britain is not divided into GP fundholders versus the rest or divided on the basis of geography. The analysis of the location of fundholding practices shows that they are to be found in some areas, but not in others. There is a geographical bias. There is also the question, upon which I do not want to dwell, of the sorts of patients whom fundholding practices may want to have or avoid. The second issue that we need to consider is equity of funding. There is not equity of funding. That is a fact. Fundholding practices get better financial contributions than do other practices. Nobody is arguing against that. We need not dwell on the matter. If I were a GP and did not want to be a fundholder but wanted to do the best that I could for my patients, I would think badly of a situation that heavily discriminated against me and in favour GP fundholders. There is no logic or fairness in that system.

Mr. Mans: The hon. Gentleman says that there is no dispute, but what about the comments of Professor Glennester in his study of fundholding practices? He says that it is difficult to support the contention that, nationally, GP fundholders were systematically overfunded compared with what a national formula would have given them in the early years of the scheme.

Mr. McLeish: A trawl of his further comments would show that the professor simply does not know, because one of the key weaknesses of the Government's effort has been that there has been no proper evaluation of what has been happening.

Mr. Malone: Will the hon. Gentleman give way?

Mr. McLeish: The Minister should wait until I raise that issue. If he thinks that some objective evaluation has been done, he must be the only one in the medical community who does.

The third issue is that of equality of opportunity for GPs to participate not only in what the Government would call purchasing of care but in dealing with providers. There is still dialogue in each area about what is provided, but it is clear that the GP fundholding model sets up difficulties for and barriers between the purchasers and providers of care.

Mr. Malone: Let me deal with evaluation. The hon. Gentleman says that nobody knows of any evaluation. He may not have heard of the National Audit Office report on fundholding, which went into the matter in some detail. It states:

"The direct involvement of general practitioners in health care purchasing has led to improvements in the services provided for their patients and made fundholders more aware of the cost implications of their spending decisions."

It went on to recommend to the NHS executive board that it "should endeavour to ensure that the benefits of general practitioner involvement in purchasing, as demonstrated through the introduction of fundholding, are extended to all patients." If the hon. Gentleman were prepared to travel in that direction, I could find more common ground with him.

Mr. McLeish: The Minister has opened up a hornets' nest because I am going to deal in a big way with the reports of the Health Select Committee, the National Audit Office and the Public Accounts Committee. They make some pretty damning statements on the lack of information upon which proper evaluation can be based.


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The fourth issue that I want to stress is the strategic input of the health authorities. It is crucial in any primary health care system that the health authority and the providers are involved in the care that is being provided and in the purchasing of treatment. In the public interest and in the interest of value for money for taxpayers, it is ludicrous that long-term contractual obligations can be severely undermined by a system of GP fundholding that often operates in isolation from wider concerns such as spot contracts. Mr. Malone indicated dissent .

Mr. McLeish: The Minister shakes his head, but the fact is that, where GP fundholders exist, there are major problems in that respect. It is one of the problems about which the Government are, again, blinkered.

The GPs have budgets; let them purchase care with spot contracts if they wish; but with such a myriad of contractual relationships developing, what about the providers? In Health questions this week, one of the Minister's hon. Friends, the hon. Member for Salisbury (Mr. Key), raised the question of the destabilisation of hospitals. We should be interested not only in GPs being able to commission or purchase care but in the quality of providers. A primary health care system cannot work effectively when hospitals are destabilised to the extent that they can run out of cash and, more importantly, have no long-term future because they are not part of the particular privilege that has been given to GP fundholders.

Mr. Malone: I am sorry to disappoint the hon. Gentleman, but before he extends that argument too far, he should take into account some simple facts. For example, there is the accountability framework that has been published, ensuring that GP fundholders must take into account the implications of the possible service dislocation to which the hon. Gentleman referred. That includes the lodging and approval by the health authority of practice plans.

If there is going to be dislocation for a provider--the precise point that the hon. Gentleman was dealing with--practices have to give due notice, so that the provider unit at the hospital can adjust accordingly. The very points that the hon. Gentleman is illustrating are dealt with in the accountability framework in the fullest possible way.

Mr. McLeish: That does not square with the question of the hon. Member for Salisbury on 31 October.

Mr. Malone: My hon. Friend was wrong.

Mr. McLeish: Does that mean that anyone who criticises the Government has to be wrong? The question of the hon. Member for Salisbury stated:

"However, will he now look at a problem that has arisen and advise my national health service trust? Where that trust literally runs out of money, it is beyond doubt and political banter that patients suffer because non-fundholders cannot have equal access to the national health service trust."--[ Official Report , 31 October 1995; Vol. 265, c. 90.]

That was a Conservative Member. The Minister can accuse us of being politically prejudiced and a bit biased, but that was one of his hon. Friends. The Minister cannot continue to rubbish the comments of his colleagues and


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dismiss key issues about the strategic input of health authorities in the development of primary health care. Of course, that problem leads to another issue.

The Government always come to the Dispatch Box and lecture everyone on value for money. The Government have a problem, because value for money is often equated with least cost, but value for money is entirely different. The increased bureaucracy involved in certain aspects of primary health care surrounding GP fundholding means that a lot of money is being tied up in pushing paper.

Does the Minister accept the logic of the Secretary of State for Health who, after his Government have created an explosion of management, wants to cut it back? What are the Government doing to ensure that investment in management in GP fundholding is not done at the expense of patients? If, throughout the country, every GP fundholder has a budget, where is the accountability and the value for money?

Mr. Malone: In the framework.

Mr. McLeish: The Minister says that it is in the framework, but, in a sense, it is getting further and further away from real accountability and moving more and more towards the market model. The Minister is not unhappy with that, because that is his agenda. We are unhappy with that, because it means that taxpayers' money may not be spent to the best advantage.

There is also the matter of the long-term future stability of GP fundholders themselves. The Minister may want to answer this question: if every GP practice is a fundholder, how will they be funded? At present, the GP fundholders' budgets come from the health authorities' overall funding. There is currently an obvious discrimination in favour of fundholding practices, but if all practices were fundholders, would the Government plough in huge sums?

Mr. Malone: That is ridiculous.

Mr. McLeish: The Minister says that that is ridiculous. I wait with some anticipation for him to return to the Dispatch Box. Is there to be more money if preferential treatment is to be given or will money be taken away from GP fundholders and spread, levelling down, to use a phrase, to the non-GP fundholders?

Mr. Malone: There is no magic in this. Extra funds are given to GP fundholders because they exercise an additional management function that non-fundholders do not exercise. Non-fundholders have that function exercised by health authorities. If everybody were to become a fundholder, it does not take a flash of genius to understand that the function at present exercised by a health authority would then be replaced by the function at fundholder level. That is precisely what would happen.

Mr. McLeish: That has illuminated an issue for us: bureaucrats will simply be shifted out of health authorities into GP fundholding practices.

Mr. Jenkin: What a predictable comment.

Mr. McLeish: It is predictable, but predictable comments often make sense, especially given what the Minister said. He knows, and GP fundholders will appreciate it in the long term, that the financial stability of GP fundholders will ultimately not be what it is now.

Ms Hodge : If bureaucracy were transferred from one health authority to a large number of GP fundholders,


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would not that inevitably lead to an increase in the amount of resources spent on bureaucracy at the expense of patient care?

Mr. McLeish: That, too, was a predictable comment, but it was brilliantly penetrating in terms of the issue at stake and of what the Minister just said.

Mr. David Rendel (Newbury): Is it not also true that, if bureaucracy is transferred from a health authority to the doctors concerned, GPs who have been heavily trained at great expense to the public to become doctors will then be used as bureaucrats?

Mr. McLeish: That, too, is a valid point. The deep disquiet within the health service is all about the financial nexus being pushed between patient and doctor. That is another example of what could happen in the future.

Mr. Jenkin: May I just thank the Opposition for expounding the Stalinist theory of public administration?

Mr. McLeish: That comment does not even rise to predictability, and I shall not waste the House's time in answering it.

Earlier, the Minister focused on one of the issues that we want to raise, when he made one of those comments that the Government liberally make about the benefits of GP fundholding. It is widely appreciated that benefits have flowed to patients, and it is clear that freedoms have been enjoyed by doctors. But whereas the Minister talks about objective evaluation, the same Audit Commission report that he quoted earlier says in its preface:

"There is a dearth of factual information about the scheme which has grown and changed at a very great rate. It has not been evaluated systematically and, although there are a small number of published studies, most tend to be based on comparatively small samples and have relied on fundholders' own assessments of their achievements." The Lancet of 28 October said:

"Our knowledge about fundholding is rudimentary. Many important questions remain unanswered."

It then goes on to say:

"Even the scant results we do have must be interpreted cautiously."

The question that we must pose is: on what basis do the Government make extravagant claims about the benefits of GP fundholding? The Minister has been energetic enough to rise to intervene in past exchanges, but I suspect that the Government have no interest in properly evaluating this exercise. Regardless of whether patient care is improving, the political benefits from the exercise are overwhelming. In the run-up to an election, it would be daft for the Government to evaluate what is happening objectively, in a scientific or non-scientific way.

Although the issue concerns the public purse, because the Government have invested much time and money in this development, they are now acting irresponsibly. They will not initiate research with a sensible methodology, which would give the House and the country a proper basis on which to evaluate the claims that have been made.

Mr. Congdon: I have listened carefully to the points that the hon. Gentleman makes. Earlier, he said that we have a two-tier service. That implies that fundholders are doing their purchasing better, so if the hon. Gentleman wants an audit of fundholders as he described, the searchlight should be on the poor purchasing of health authorities.

Mr. McLeish: That point carries no weight because, in a sense, privileges conveyed financially allow GP


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fundholders to exercise purchasing rights on behalf of patients. It is self-evident. The issue is not about fundholders and non-fundholders exercising different skills in terms of quality of care, which would be a different debate.

The Government cannot continue to parade those benefits before the country unless and until they have information on which that is based. They can do so in a political knockabout debate, but I hope that the National Audit Office and the Public Accounts Committee will soon examine why nearly 8 per cent. of the health service budget--£2.8 billion--is tied up in an experiment that has not yet been evaluated. As a fellow Scot, the Minister may like to say why he took a much more cautious approach in Scotland, where he piloted projects that could be evaluated. If pilots have been carried out in Scotland, why are they not good enough for England? The Government are behaving irresponsibly and the Minister is silent because he knows that he does not have the information to make such ludicrous statements about achievements.

How can we have a partisan embrace of GP fundholding to the total exclusion of the other 50 per cent. of the country? I have already mentioned the figures. Are we to pretend that the treatment given to 40 million patients is of no significance to the Government? Are we to believe that 7,730 GPs are operating outwith Government approval because they have not yet had the guts to buy into GP fundholding? Or are we to believe that the 95 commissioning groups throughout the country are not doing a good job?

Does not that illustrate why the Government are so fundamentally unpopular? They hook into a certain obsession and relegate anyone who dares criticise it or does not come forward to be involved. The Minister cannot continue to conduct business in such a sensitive and vital area as primary health care with such a dogmatic attitude. Although I asked him, in his contribution, to discuss GP commissioning in its variety of forms, I had no response. If one wants to build on the best, one must see what is happening in the various exercises throughout the country. Naturally, the Minister wanted to discuss GP achievements. Why, then, does not he go to north Cumbria and look at the alliance there, where

group-negotiated funds for open-access exercise electro-cardiograms for all GPs have transformed access to cardiology for all patients? Why does not he look at the Blackpool, Wyre and Flyde GP advisory group's surgery-based dietetic service? There are lists and lists of good news stories.

Mr. Malone rose --

Mr. McLeish: The Minister may now want to rescue his position, but he has simply ignored a huge swathe of innovation, activity and excellent things happening in the health service.

Mr. Malone: That was a bad example for the hon. Gentleman to choose. He may understand that, when party conferences are held in Blackpool, Ministers sometimes feel constrained to remove themselves from the winter gardens. I visited the commissioning practice of which he speaks and spoke to its members for an hour about what they do. I found that, although they have an innovative


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practice, they had had the utmost difficulty in getting the local health authority to agree to it, because they did not have purchasing power. They also came up with a list of proposals so that they could be given expensive management costs to carry out joint commissioning. That undermines the hon. Gentleman's point about it being a cheaper option.

Mr. McLeish: That contribution does not take away the fact that the Government are simply not interested in what is happening outwith GP fundholding.

I do not want to go on and on with other examples. It is a question of balance. Given that the Government are 40 points behind in an opinion poll conducted by a paper widely read by themselves, is it not time that they listened to those who do not embrace or applaud some of what they are doing in government? After 16 years, they simply do not care. That is the conclusion that you must reach, Mr. Deputy Speaker, after hearing the Minister's responses.

The Government have given no answers on a range of issues that are important for the future of primary health care, which is not developed in a vacuum. They include access, funding, the strategic importance of health authorities, equal access by GPs to providers in terms of dictating quality, and evaluation and objectivity in making claims. All those issues have been neglected. One cannot have a system of GP fundholding or GP commissioning that ignores in large measure the implications of those issues.

Worryingly, at a time when the Government have been partisan and particular, they continue to want to ignore some of the issues that I mentioned. I hope that, specifically, the Government will now initiate, arising from the debate, a series of far-reaching studies into GP fundholding and some of the other innovations that are taking place throughout the country.

We started the debate by saying that there was a fundamental distinction between what we, Labour, wanted to achieve in health care and what the Conservative Government wanted to achieve. Considering the Government's strategy logically, one recognises the classic signs of a process that was recently imposed on the railways, and is now being imposed on the health service--fragmentation, contractorisation and commercialisation. If the nation gave the Conservatives a fifth term, they would move to privatisation.


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