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Mr. Peter Brooke (Cities of London and Westminster): As you, Mr. Martin, have particular occasion to know, I sat here throughout the windfall tax debate yesterday hoping to speak on behalf of the City of London. I make no criticism of the fact that I was not called, and I know that you did your level best to ensure that I would be called. I mention it merely to make the point to new Members that one can just as easily be asked to sit through the whole of a debate and still fail to make a constituency speech when one has been in the House 20 years as after being here 20 days, 20 weeks or 20 months.
I am over 60 and I do not have any private health insurance. I represent an inner-city seat, and it is a commonplace that such seats have a greater proportion of elderly people than do the generality of seats: that is certainly true of my constituency. The health service reforms were substantially directed to demography and to the growing numbers of the elderly. We have had a long debate in London on the availability and supply of hospital beds. Professor Jarman of St. Mary's hospital in my constituency has made a series of notable contributions to that debate, and I am delighted that he has been put on the Secretary of State's panel reviewing the position with regard to London hospitals.
You will rule me out of order, Mr. Martin, if I go on too long about long-term issues of the national health service in inner London. The resource allocation working party was established by a Labour Government, supported by the Liberal Democrats at the time of the Lib-Lab pact and endorsed by the Conservative Government in 1979. One of the consequences of RAWP was the serial closures of hospitals in London. There was bipartisan agreement for resources deliberately to be moved out of inner London to other sites across the country. Charing Cross and St. George's hospitals in my constituency had already been closed.
Dawn Primarolo:
I agree with the right hon. Gentleman about Professor Jarman's contribution. The right hon. Gentleman also referred to RAWP and the health authority funding formula. Does he accept that the problem of draining money out of London resulted from the Tomlinson report, which was commissioned by the Conservative Government?
Mr. Brooke:
I apologise to the Financial Secretary, but I do not agree with her. Westminster hospital in my constituency closed and moved its services to the new
We are already in difficulty, because 30,000 of the 300,000 people in the Bart's catchment area are seriously disadvantaged by the move. That area covers my constituency, the constituency of the Secretary of State for what I will now call the Department of Culture, Media and Sport and the constituency of the hon. Member for Hackney, South and Shoreditch (Mr. Sedgemore). Elderly people went to live in the Barbican because of the NHS services available there, so their anger at the closure of Bart's was understandable. I acknowledge that that decision was made by a Conservative Government, so their anger was partly vented on me. The problem has been exacerbated by the present unsatisfactory alternative arrangements.
I draw attention to the straitened circumstances of the NHS in London. I am joined in that by London Labour Members, who have applauded the review that the Secretary of State for Health is undertaking. London is not well placed to absorb further strains. The establishment of a panel has been welcomed, and I can remember debates before the election in which London Labour Members called for a moratorium on hospital closures and an end to the practice of withdrawing hospital beds from London.
I acknowledge my ignorance, because I do not know how many of my elderly constituents who have private medical insurance--obviously, there are some--will transfer out of their present arrangements as a result of the proposed tax change. I have an 80-year-old constituent whose gross premium for himself and his wife is £3,105.46, with tax relief of £714.21.
The Financial Secretary said that the cut in VAT on fuel would benefit pensioners. I know that she knows that pensioners were, in fact, compensated for the original VAT on fuel, and I acknowledge that the cut in VAT will make a difference at the margin. If that is so, it must also follow that pensioners who have private medical insurance may also be affected at the margin if sums of some £60 a month are involved.
In her opening remarks in reply to my hon. Friend the Member for Daventry, the Financial Secretary said that the Opposition had had a good try. Imitation is the sincerest form of flattery. The Opposition have had long cause in the two months since the election to note the Government's enthusiasm for reviews in every possible direction.
Given the present problems of the national health service in London, I fear for all my constituents and not just for those who have private insurance, because we do not know whether the system can take the strain of patients transferring over. Like the hon. Member for Redditch (Jacqui Smith), I have constituents who have been waiting 18 months for operations. I am concerned about how many of those who do not have medical
insurance will be adversely affected by the extra demand that this measure will create if the amendment is not carried.
Mr. Jim Murphy:
I am pleased to follow the right hon. Member for Cities of London and Westminster (Mr. Brooke). I have considerable respect for him and for his contribution in varied areas of government over many years. I enjoyed the informative nature of his speech and his analysis of London's health service. I want to direct my points primarily to the amendments, so I shall not respond to the specifics of the London health service, of which I do not claim to be a specialist. However, I shall talk about the plight and aspirations of Scotland's pensioners, who will be affected by the Budget.
The Government's plans on private medical insurance have been strongly welcomed by Age Concern Scotland and the Scottish Pensioners Forum, who speak on behalf of approximately 600,000 pensioners in Scotland. More particularly, I am certain that the more than 14,000 pensioners of Eastwood will strongly support the proposals in the Finance Bill. I have not yet received any communication or telephone call giving a negative view of our plans for private medical insurance. I shall not pre-empt what may happen this weekend, when I shall have eight separate advice surgeries, but thus far none of my constituents has criticised our plans--quite the contrary.
The Government's plans to reform the health service to ensure that more people have access to quality health care have been strongly welcomed. I am certain that today's announcement on GP fundholding will be mentioned in my constituency surgeries over the weekend. Labour is trusted on the health service, which is why the Opposition's genuine concerns will not be understood or felt by the constituents of Eastwood.
The announcement in the Budget was not a surprise, whatever Conservative Members may say. In 1989, the Chancellor--then shadow Chief Secretary to the Treasury--announced that Labour would introduce this measure if we were in government. More recently, in 1996 no less, the current Chief Secretary to the Treasury stated that we would reduce VAT on domestic heating to the lowest legal minimum threshold, and reduce the subsidies for private medical insurance. That was less than a year ago, and the assertion that it was not well known in advance shows a misunderstanding of what the Government are trying to achieve.
For two reasons, the proposal did not come as a surprise. First, the Chancellor said in his Budget speech that the arrangement had not worked and was still failing. It did not encourage widespread take-up of private medical insurance, although I understand that the Conservative Government introduced measures to try to increase the take-up, which had fallen throughout the 1980s. I understand that the measures in 1989 and 1990 were intended to bring some dynamism into the market for private medical insurance.
The second reason for introducing our measures relates to VAT on domestic fuel, and our approach should be compared with that of the Conservative Government. As I have said, their approach to the matter caused significant surprise. On 6 April 1994, they introduced changes to
private medical insurance relief. It is incredible that Opposition Members have the audacity to demand of the new Government that which they did not have the confidence to present to Parliament when they were in government.
Mr. Boswell:
Will the hon. Gentleman give way?
Mr. Murphy:
I will give way later. The hon. Gentleman has the old hand's technique of coming to the Dispatch Box and asking to be allowed to intervene. I would be more responsive if the hon. Gentleman did not shout as he was approaching the Dispatch Box.
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