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Health Services Accreditation
12.59 pm
Mrs. Jacqui Lait (Beckenham): I am grateful for the opportunity to raise in the Chamber the subject of the disposal of Health Services Accreditation. I welcome the Minister to the Dispatch Box. It probably is not the first time that he has been there since his appointment, but it is the first time that I have had the opportunity to address him there.
It saddens me that I have had to bring this issue into the Chamber today. My primary concern is that the work and knowledge of the effective development of standards in the national health service is not lost, but continues. HSA recently published its service standards for the care of elderly people, and there are continual demands from customers for new work in mental health, children's services, sexual health, housekeeping and catering--and, of course, in primary care.
HSA's system for the development of standards seems to me to be the most effective yet, because the standards are developed by users and are agreed on and implemented by users--hence they are owned by the people who use them. They are not imposed from above. Currently, some 50 health trusts throughout the United Kingdom are contracted to HSA, and more than 90 departments are in the process of implementing HSA's work.
My involvement began when I was Member of Parliament for Hastings and Rye. I am pleased to see my successor, the hon. Member for Hastings and Rye (Mr. Foster), in the Chamber, as I know that he has taken an interest in HSA. When I represented that constituency, I was invited to a presentation of certificates at the Conquest hospital in Hastings, which was one of the pilot sites. I was so impressed by what I learnt then that I visited HSA, based at Battle, in the constituency of my hon. Friend the Member for Bexhill and Battle (Mr. Wardle). As a result, I agreed to introduce HSA to the wider audience of Westminster--which I did when I, with the hon. Member for Lewisham, East (Ms Prentice), who continues to take an interest in HSA, sponsored a function in the House before the general election, attended by the then Ministers and shadow Ministers, including the Secretaries of State.
When I lost the seat at the general election, I returned to my previous day job and began to build up a lobbying business again. HSA asked me to advise it, which I was pleased to do, as I believed in its work. As soon as I was selected to stand for Beckenham, I cancelled all contracts, but my interest in HSA has continued.
I knew that HSA's future was uncertain because of the terms on which it had been handed over from the region. Indeed, the consortium of health authorities should have solved the problem of its home by March 1997, but agreed to continue funding until March 1998. I am told by Andrew Corbett-Nolan, who was HSA's director, that at a meeting with Sir Alan Langlands of the NHS Executive in autumn 1997, it was agreed that efforts should be made to retain HSA in the NHS. Shortly after that, East Sussex health authority, as the lead authority, extended the disposal time for HSA until September 1998.
In January 1998, the chief executive of East Sussex health authority, accompanied by the director of public health, told the HSA director at a meeting that, because
of worries about overspending, HSA would be closed down at the end of March 1998 unless the director could make arrangements for it to be found a home elsewhere. I believe that, at that time, there was no discussion about invoking the formal disposal procedure governed by health service guidance (94)54, to which I shall refer.
The director went to the King's Fund, and it agreed to take HSA. The chief executive of East Sussex health authority welcomed that in a letter, but said that he had now to invoke the disposal procedure. I understand that there was then correspondence between the fund and East Sussex. I am told that on 5 March--at a meeting between the HSA director, the assistant director of finance of East Sussex health authority and the director of operations of the King's Fund--the assistant director of finance guided the King's Fund as to the terms of its offer.
By 27 April, East Sussex health authority had made no progress on the disposal procedure. The King's Fund offered the director of HSA the job of director of development of Health Quality Service--an organisation in association with the King's Fund--and he accepted that offer. He resigned from HSA that evening and began at the fund on 18 May.
To the outside world a possible conflict of interest now existed, as was also possible for the chairman of the advisory board of HSA, who had joined the board of Health Quality Service the previous autumn, in 1997. HQS was launched on 3 June 1998. Its mission is to
Meanwhile, on 14 May, East Sussex had invited expressions of interest in HSA by an advertisement in the Health Service Journal, but not in the European Journal. Customers were alerted, by letter, to the disposal.
At the launch of HQS on 3 June, Baroness Jay, who was then a Health Minister, Yvonne Moors--the chief nurse--and Lord Hunt of Kings Heath, better known as Philip Hunt of the National Association of Health Authorities and Trusts, all welcomed the amalgamation of HSA with HQS and hospital accreditation. Several people in the audience have separately told me of their surprise at those statements, bearing in mind the fact that we were only at the stage where bidders were being invited to talk to East Sussex health authority.
I understand that, in July, ESHA held its meeting to consider the bids that it had received. The guidance (94)54, with its annexe B by Price Waterhouse on the disposal process, recommends the establishment of a
project team. The East Sussex team consisted of the chief executive, the director of finance and the director of public health. At paragraph 9, the Price Waterhouse document recommends that
When I put those two points to the chief executive of East Sussex health authority, he told me that the team had taken a deliberate decision to involve neither. The team felt that customers would leave HSA, and that the staff would leak to their ex-director--a recognition, I infer, that conflicts of interest existed.
I make no judgment, other than to say that the decision flies in the face of guidance from people expert in the disposal of companies, who were sufficiently highly regarded by the NHS to be invited to write the detailed annexe. That document says that the project team needs to develop detailed requirements for bidders, and, at paragraph 52, says that the
Negotiations with potential bidders continued during summer 1998, and at the end of August the director of finance of the ESHA issued the invitation to tender, with a return date of 22 September. Paragraph 55 of the Price Waterhouse annexe says:
However, when a company representative went to HSA to meet the staff, it was not to discuss the due diligence subjects of finance and legal obligations, but to find out about the services provided by HSA--a subject about which anyone would reasonably have thought that the company already knew, having made what should have been a legally binding offer, subject only to due diligence.
At a further meeting, a partner or client company of the official bidder also visited HSA premises. Staff report that this second team had no clear knowledge either of the organisation or the product that it was buying. Somewhat unsurprisingly, on Christmas eve the offer was withdrawn. I understand that the ESHA is now trying to resurrect the interest of the other two bidders who had submitted tenders. However, if none is forthcoming, HSA faces closure at the end of March.
I am sure that those who have taken part in the tortuous process that I have outlined have acted with the highest possible motives. I may disagree with the attitude of the East Sussex health authority towards consultation with customers and staff; that is a matter of judgment, but it seems sensible to have those two important groups on board when efforts are being made to dispose of an organisation in which they have a direct and clear interest.
I have deliberately kept my comments to a bare outline. However, while the process was continuing I raised my concerns with Ministers by parliamentary questions, both written and oral. Most recently, I wrote to the previous Minister of State. I sent copies of that letter to the head of the National Health Service Executive, Sir Alan Langlands, the National Audit Office, the Audit Commission and the chief executive of the East Sussex health authority. Other than brief acknowledgements I have received no replies.
If any hon. Member had shown the slightest interest in even the smallest frog in the NHS pool, I would have expected that to cause someone somewhere to instigate full inquiries encompassing all the players in the small drama that is the subject of the debate. My concern remains to save the work that has been done, is being done and requires to be done. We all wish there to be higher standards in the NHS.
"signal to the health sector throughout the UK that we"--
HQS--
"are the premier quality assurance and quality improvement programme",
and
"to develop new standards of outcome measurement for patient satisfaction, staff motivation, clinical effectiveness, service efficiency and service access."
The situation is as follows. One organisation has now been encouraged to bid for an NHS operation. Two people closely associated with that operation--so closely associated that they knew all the operating financial details, which were presented to the advisory board of HSA at each meeting--are now involved in the bidding organisation. I accept their word that they were never involved in the bid, but, should that situation have occurred in the private sector, some searching questions would probably have been asked at that stage.
"customers should be consulted about the composition and objectives of the project team. It is also important to ensure that staff on the trading body to be disposed of are fully consulted. The precise choice of who serves on the project team should strike a balance between including those with experience of the service under review and avoiding possible conflicts of interest."
I am not aware of any consultation with customers except for the letter to customers, and I am told that there has been no consultation with staff that they would regard as meaningful. Indeed, some would go so far as to say that there has been no consultation.
"findings will need to be agreed with all of the stakeholders, i.e. all those who will have the service provided for them. Care must be taken to identify all such stakeholders since there may well be 'passive' customers who are benefiting from a service at present and whose requirements will need to be included in the formal contract."
In the summer, staff were also told by East Sussex health authority that they could not mount a management buy-out.
"Together with the service specification, the tender and contract documentation need to form the basis of a legally binding contract."
By 10 October, a very acceptable offer had been made to East Sussex health authority. I understand that the tenderer signed a confidentiality agreement to carry out due diligence, but I am told that it did not sign a legally binding contract. Staff tell me that they received no information about the winning bidder, and had to find out about the company from its website. I am not naming names because the company has now withdrawn.
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