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Mr. Foster: My hon. Friend makes an important point. There appears to be a fair body of evidence that suggests that there is much support for the proposal of the right hon. Member for City of London and Westminster, South. It is nevertheless important for, and incumbent on, all hon. Members to take careful account of those who are critical of these proposals and to ensure that, before the final version of the Bill is passed by the House--if that is to be so--we answer their questions clearly.
My hon. Friend made another important and relevant point: whether the Government will make sufficient funds available to ensure that we meet the targets for dental and medical training that they established. I do not know whether he is aware of this, but there was an interesting exchange recently in another place, when Baroness Fisher asked Her Majesty's Government:
We are asked to accept that the merger will lead to economies of scale. My hon. Friend has already expressed the views of a number of people who believe that there is no clear evidence that that will be the case. The medical and dentistry secretary at Queen Mary and Westfield, for example, recently said that, from its recent experience of merger, there have been no short-term advantages, but acknowledged that there might be some long-term advantages. There is little evidence to show that any economies of scale will accrue from this merger, certainly not the evidence expressed in the debate. I hope that some evidence will be provided before the end of the debate.
As my hon. Friend the Member for Southwark and Bermondsey said, it is worth taking it into account that economies of scale are usually assumed to come from an expansion of an institution; yet, as we heard earlier, because teaching may take place on a number of different sites, there may not be evidence of the economies of scale in this case.
There is also the point expressed in paragraph 195 of the Tomlinson report, which suggests that an intake into a medical school of more than 200 or 250 would not
necessarily be a very efficient way of doing things in managerial or organisational terms. It is interesting to note that the merged college will have an intake of about 300. Even within the Tomlinson report, which advocated such a merger, there is evidence to suggest that in this case it may not have managerial or organisational advantages.
Mr. Henry McLeish (Fife, Central):
I shall try to be brief, and confine my remarks to what the Minister said earlier.
The hon. Member for Southwark and Bermondsey(Mr. Hughes) made a number of detailed points, and the right hon. Member for City of London and Westminster, South (Mr. Brooke) will doubtless wish to deal with some of the issues that he raised with the benefit of local knowledge and an interest in the subject.
I welcome the Bill, which, I hope, will enable the aspirations of the promoters to be realised. There is no doubt that medical education and research in London is important not only to the capital but to the nation and, indeed, the world. The House would, I think, expect any Bill such as this to enhance rather than detract from what is already happening.
The hon. Member for Southwark and Bermondsey raised the question of property, which is linked to the issue of the private finance initiative. In its response to the Tomlinson report, the British Medical Association mentioned concerns about the merger--concerns, rather than objections to what was being discussed. In paragraphs 13.4 and 13.5 of that response, entitled "London's health services education and research: response to the Tomlinson report", the BMA states:
An article featured in The Times Higher Education Supplement on 26 January this year raised the whole question of the private finance initiative. I do not want to inject too harsh a political note into the debate, but it is clear that the PFI has not been the remarkable success for which the Government hoped. The article suggested that
The article in The Times Higher Education Supplement points out that a final decision would have to be made by July this year. As he is not here, the Minister cannot respond, but I hope that the right hon. Member for City of London and Westminster, South will tell us whether the PFI is on track, and also whether a decision must indeed be made by July. I suppose that the obvious further question is, "If not, why not?" The project will clearly require investment; the Government have gone down the PFI road, and it is clearly in the promoters' interests to know the current implications.
Mr. Simon Hughes:
There is another question which neither the hon. Gentleman nor I asked, but which people outside may ask. Who are the prospective partners? When funds are required for a project involving health education and medical research, some people might not be regarded as necessarily very desirable partners in a consortium because of vested interests in the pharmaceutical industry or other industries. That is another question to which the right hon. Gentleman might usefully give us an answer.
Mr. McLeish:
I was going to touch on that. The illuminating article in The Times Higher Education Supplement tells us that
The article poses another question by suggesting that
"How they intend to guarantee the necessary finance to train an additional 500 doctors by the year 2000 in view of the impact upon university medical schools brought about by the 28 per cent. cut in their funding over the past six years and the further 5 per cent. cut for teacher training imposed in the last budget."
In response, Lord Henley drew attention to the fact that the Government would take into account concerns about funding for medical and dental education. He said:
"However, the Government have to take into account the wider considerations, such as the burden on the taxpayer and the need to control public expenditure."
He went on to make a similar point, saying that very difficult decisions have to be made about how they allocate the sums of money that are available for higher education. He said:
"We believe that the medical side of higher education receives its fair share."--[Official Report, House of Lords, 19 June 1996; Vol. 573, c. 316-18.]
"Fair share" in that context has led to significant cuts. That is why we need clear assurances that additional money will be made available in the short term to fund the merger.
"There is concern, however, that the use of split sites for amalgamated schools will lead to a lack of space and facilities which will make it difficult to deliver the curriculum being proposed by the GMC . . . It is a matter of some concern that the Report considers that the costs of rationalisation can be self-financing through the sale of medical school assets."
At that point, post-Tomlinson, it was feared that the merger might have an impact on not only the use of sites but the quality of education.
"King's College London and the United Medical and Dental Schools"--
which are being merged--
"are looking to clinch the biggest deal so far"
under an initiative worth £125 million. No one would deny that such an initiative requires investment, but it is important to set that against the performance of the Government's other PFI projects. The point is worthy of
concern, and I hope that the right hon. Member for City of London and Westminster, South will address himself to it. If a significant investment is required, can we be guaranteed that it will be delivered through the PFI? It has not been delivered to provide hospital improvements, refurbishments and new building, and there have been major problems in other regards. There have been delays, and many people find the PFI a cumbersome way in which to attract capital. When a consortium is involved, it may be interested in more than just the bricks and mortar that the merger would no doubt require.
"Six consortia have been invited to make detailed bids, out of the 30 that made initial inquiries."
Linked to that statement, and perhaps extending the concerns expressed by hon. Members, is the statement that
"The successful private finance consortium will have to provide additional services over and above the basic construction and financing of the new building. Lynn Carlisle, co-ordinator of the PFI project, said the colleges would be looking for proposals for campus management."
That raises some of the issues that have surrounded other PFI projects. Is it a question of buildings? Is it a question of refurbishment? Is it a question of site acquisition and development? Or does the issue indeed extend to the provision of services? That has a material bearing on the merger, and, unfortunately, on whether the consortia can secure the adequate return that they seek.
"the project was proving popular with developers partly because some valuable West London buildings belonging to King's College will be refurbished for non-educational uses."
That is in the context of a very significant merger involving many changes in land use and building construction. Perhaps it should happen, in terms of the viability of the project, but surely these issues will interest the community in London. They are certainly important in regard to the medical and educational aspects. Given all the problems surrounding the PFI, we must be given some indication this evening that the project is
proceeding, that there is interest and that the nature of the deal that is ultimately struck will favour the college and schools that are being merged and not--as PFI projects suggest--the developers.
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