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Liz Blackman: My right hon. Friend mentioned the new hospital in Carlisle. Some 40 years ago, I had my appendix out in that old Victorian workhouse, so the people of Carlisle have waited a long time for their new hospital--and this Government have delivered it.

Mr. Milburn: I am grateful for my hon. Friend's observations. It is true that communities up and down the country have waited many years for the new hospitals that are now coming on stream. I remind the House that when the Conservatives were in office, they managed to spend £30 million on lawyers' and accountants' fees for PFI hospitals, but they did not get a single new hospital built. We have changed that.

Dr. Brand: For the sake of completeness, can the Secretary of State tell us what has been the effective reduction in bed availability as a consequence of the PFI projects that have resulted in those new hospitals?

Mr. Milburn: The hon. Gentleman will be aware that when we announced the first wave of new hospital building under the PFI arrangements--including Carlisle and Dartford, I believe--we carried out a comparison between the public sector and the PFI option to get the best value for the taxpayer. Indeed, we will proceed with any of the schemes under the PFI option only if it offers better value for money. In some cases, we will not proceed with PFI on value for money grounds if we think that Exchequer capital can produce a better deal for the taxpayer than the private finance option.

When we compare the number of beds available under PFI with the number available under the public sector comparator option in the first wave schemes, the number barely differs. In fact, my recollection is that the number of beds overall is slightly higher under the PFI option than it is under the public sector comparator option. Therefore, the idea that PFI is reducing the number of beds in the system is wrong.

Over many years, especially under the previous Government, the number of hospital beds declined markedly. Some 40,000 beds disappeared in the Conservatives' last 10 years in office alone. I have said many times that that decline has gone too far, and we now need to see an increase in the number of beds in the system. We have an opportunity to achieve that, given the resources that we are making available.

Mr. Bercow rose--

Mr. Milburn: I give way to the hon. Gentleman, and I realise that he does not represent south Buckinghamshire.

Mr. Bercow: I am glad that the Secretary of State recognises that, among other things, he needs a lesson in

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geography, because my constituency is in north, not south Buckinghamshire. Will he now explain why he is cowering behind NICE--the National Institute for Clinical Excellence? Why, in the consideration of the supply of beta interferon, is he refusing to take account of the cost of the domestic adaptations required in the absence of the supply of that drug, and why does he think that it is right and proper to deny the additional 50 patients each week who are diagnosed as suffering from a chronically debilitating disease the prospect of some alleviation through the supply of that crucial drug?

Mr. Milburn: There is no argument about multiple sclerosis being a deeply debilitating disease. Every hon. Member understands that, and also understands that there is no cure for MS. The hon. Gentleman knows that I am not sheltering behind NICE. As I understand the position from the speech by the hon. Member for Woodspring yesterday--if it is still Conservative policy today--the Conservatives now support the role of NICE in the assessment of both cost and clinical effectiveness.

The hon. Member for Buckingham knows that NICE is assessing beta interferon. It is supposed to be a confidential process, as the drug companies preferred. NICE conducts its own appraisals in the way that it decides is best. The appraisal committee has met and made a provisional appraisal which has been leaked, unfortunately. It is not, nor will it ever be, the Government's intention to comment on leaks or provisional assessments from the appraisal committee. We will see what NICE comes up with, and I do not doubt that it will take the views of MS sufferers and others fully into account in reaching a final decision and making recommendations.

Dr. Fox: I am grateful to the Secretary of State for allowing me to clarify the point. We believe that NICE has a role in exactly the areas he outlined--cost and clinical effectiveness. That was agreed by both sides of the House when the Bill was in Committee. The trouble is that the Government sneaked affordability in, by statutory instrument, as another criterion for NICE. It is not equipped to deal with that criterion, nor does it want to have to assess it, but that is the arm's-length rationing mechanism for Ministers who do not have the courage to take the decisions overtly and transparently.

Mr. Milburn: The hon. Gentleman knows well that that is not the case. There is the clearest of differences between an assessment of clinical effectiveness and cost- effectiveness--which, from his speech yesterday, he now supports--[Interruption.] NICE will make decisions based on clinical effectiveness and cost-effectiveness, and it will have to assess the drugs and treatments according to whether--for the amount of money available--they offer a clinical benefit to patients. Decisions on affordability are decisions for the NHS, not for NICE. That is precisely what the establishment order makes clear.

Mrs. Eleanor Laing (Epping Forest): On the point that the Secretary of State has just explained so precisely, can he tell the House why, if affordability is not to be taken into consideration by NICE, the House passed a statutory

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instrument last year that made a change in the criteria to be applied by NICE? That change was sneaked in last August when the House was not sitting.

Mr. Milburn: Sometimes I wonder why I bother. [Hon. Members: "Hear, hear."] Well, I am pleased that the Tories are glad about something. I have just explained why we made the amendment to the establishment order. It was precisely to clarify that NICE has a role in assessing not only for clinical effectiveness but--as the hon. Member for Woodspring and his party now agree--for cost-effectiveness. As I understand it, there is no argument about that. Decisions about affordability are a separate issue for the NHS. [Interruption.] I have tried to explain it twice and if the hon. Lady does not understand, that says more about her than about the explanation.

We have invested more money in the NHS as a priority, which will mean the largest sustained increase in funding in the history of the NHS. It will be twice the historic growth trend in NHS spending, up from 3 per cent. under the Conservatives to more than 6 per cent. under Labour. By 2004, the NHS will grow by more than one third in real terms, and more than 50 per cent. in cash terms.

Our immediate priorities for the NHS have been more doctors; more nurses; modern hospitals; more patients treated; and more money invested. Not every problem has been solved, but a start has been made on turning round the NHS after decades of neglect. Those priorities have been underpinned by the changes we have made to tackle the two-tier system of care that we inherited. First and foremost, we have abolished the hated and divisive internal market foisted on the NHS by the Conservatives. In its place, we have put the primary care groups and primary care trusts, with control of local health services now in the hands of the people who know patients' needs best.

This year alone, the primary care groups--front-line doctors and nurses--are in charge of a budget of over £20 billion. That is not what the hon. Member for Woodspring calls an act of centralisation: it is the biggest-ever decentralisation in the history of the health service.

The motion accuses the Government, as did the hon. Member for Woodspring, of day-to-day political interference in the management of the NHS. The hon. Gentleman cited the number of circulars issued by the Department of Health to the health service. For the benefit of the House, I shall describe what the circulars are. Essentially, they are instructions from Ministers to NHS trusts and primary care groups.

I have some interesting figures about the extent of so-called day-to-day political interference in the work of the local NHS. In 1996, the final year of the previous Conservative Government, the then Secretary of State for Health issued a grand total of 305 explicit instructions to the national health service. Since I have been Secretary of State, I have issued a total of 21 explicit instructions to the national health service. What is more, I have set a cap on the number of such instructions to be issued from Richmond house to local health services. This year, no more than 100 health service circulars will be issued by Ministers to the local health service--and I expect the total to be far lower than that.

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I hope that that puts an end to talk about political interference in the national health service. If any party was guilty of that, it was the Conservative party.

Mr. Nick St. Aubyn (Guildford): Is not it correct that the modernisation fund, which is worth £0.5 billion a year, is entirely in the hands of Ministers, to be used at their discretion? A quarter of the beds at the Royal Surrey hospital have been cut over the past two and a half years. Senior civil servants recommended that £2.5 million be given to that hospital, but the Secretary of State personally cut that allocation to just £1 million. Will he say why he did that? If that is not political interference, what is?

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