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6.55 pm

Sir George Young (North-West Hampshire): I wish I shared the optimism of the hon. Member for Mitcham and Morden (Siobhain McDonagh).

The Bill's origin lies in last year's White Paper, "The NHS Plan: A plan for investment, A plan for reform". At the time, the Secretary of State said:

"The NHS can address the need to reform itself—from top to toe—to meet the challenges of rising patient expectations."

Reform from top to toe has been happening ever since, and the Bill is part of that.

I want to follow the line of argument developed by my right hon. Friend the Member for Charnwood (Mr. Dorrell). I want to ask whether the current wave of reform is genuinely meeting those challenges of rising patient expectations, to ask whether the reform is based on a cool analysis of the problems on the ground, and—if I find it is not—to suggest that it may be an unwelcome distraction.

Out there in the real world, the NHS's back is against the wall. Last month, the Basingstoke Gazette said:

"Hospital faces drastic cuts. Worried health chiefs are to write to MPs about a cash crisis which is forcing them to plan closures of 40 hospital beds and make cuts in services amounting to millions of pounds."

As for the new resources that Ministers keep telling us about, the paper commented:

"The Directors said the new money coming into the health service has been 'badged' for specific services and swallowed up in pay awards and targets"

and went on to say that the trust involved planned to deal with bed blocking and then close the beds.

Much as we all love our local newspaper, we do not necessarily believe every word that it prints. Looking behind it and consulting the NHS's own publications, however, will show us that the paper is right. A week or two ago, my health authority published "Improving Performance in North and Mid-Hampshire", which sits uneasily with what we have heard from the Minister this afternoon. The first page tells us:

"This means that there is currently an underlying deficit of £7.5 million in the NHS in North and Mid-Hampshire. Consequently, we face a major challenge if we are to secure health services fit for the 21st century within the resources available locally."

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We are told that the deficit is unsustainable and that

"some changes will affect how services are delivered to patients."

I think we can all crack the code, and deduce that that means a reduction in services.

If we dig a little deeper and look at individual trusts, we see the problems that confront them. According to the recently published annual report of Winchester and Eastleigh trust,

"despite the size of these savings"—

savings already made—

"the economy is likely to remain in deficit and further savings will be required if the Government's ambitious targets embodied in the NHS plan and the full cost of pay and price rises are to be met."

According to the minutes of the last meeting of North Hampshire Hospitals NHS trust:

"By August 31st, the Trust was overspent by £1.2 million . . . The Trust would still be unable to break-even at the year-end and was looking at a considerable deficit. Further proposals would be brought back to the Board next month on measures to help decrease the deficit, following discussion with the PCT and the Regional Office".

Against that background, my constituents find it impossible to reconcile the rhetoric of Ministers with what is actually happening in Hampshire. Of course, that is having an impact on the quality of the service they receive. The Secretary of State mentioned cancer services. I have a letter dated 4 September from Mrs. H, who wrote:

"I have just been told that the lymph node that was removed three weeks ago was malignant."

She needed immediate radiotherapy to deal with that. On 11 October, five weeks later, she received a letter from Southampton general hospital:

"Your specialist has made arrangements for you to have a course of radiotherapy. At the moment, we have a long wait list . . . please accept our apologies for any anxiety . . . as a result of this situation."

Of course there is anxiety and, after further correspondence, treatment will start this Thursday, 10 weeks after she was told that she needed it. She wrote to me a few days ago:

"I am still not happy about having to wait so long for treatment on my cancer".

I have asked for the radiotherapy waiting times at Southampton general hospital to see if that was unusual. The maximum acceptable waiting time according to the guidelines for radiotherapy after a mastectomy is 28 days. Not one case at Southampton was dealt with in that time: the average wait is 78 days—three times the maximum.

Like other colleagues, I pursue such matters with the health authority to ensure that it knows what is going on. I am told by the chief executive:

"I am satisfied that the Trust are making all endeavours to provide a service that attempts to treat patients within good practice guidelines, having regard to the constraints of available equipment and specialist staff."

I want to come back to those constraints because they are at the root of the problems in Hampshire.

Our hospitals have the stars, the beacons and all the trophies that validate competence in today's NHS. What we do not have is the cash, so I ask whether the problems that I have outlined are likely to be put right by a further round of administrative reform, or do the causes of the problem lie elsewhere? Will further reform make life more difficult?

The problems in my constituency—it is not unique—can be simply stated: pay awards and other costs are in excess of the inflation uplift given by the Government;

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the formula for allocating resources is wrong, which is why nearly all the authorities around London are in deficit; NHS staff cannot afford to live in Hampshire and other parts of the south-east, so there are recruitment and retention problems and excessive use of agency staff, which leads to budgetary problems; and there are severe problems of "delayed transfers of care", or bed blocking, which means that hospitals have to treat more people than they should.

Against that background, one must ask whether the Bill will help. Clause 1 sets up the new strategic health authorities—major turbulence. I was sent the document relevant to my constituency. It was entitled "Modernising the NHS: Shifting the Balance of Power in the South East", a grandiose title with geopolitical overtones, but it really means that four health authorities in Hampshire and the Isle of Wight are knocked into one. The first paragraph tells us that NHS reform will

"address the issues that really affect the patients"

but once we have read it, we realise that it does not. It is a thin document with 12 lines on the financial implications on page 21. There are no details of any costs or savings, simply an aspiration that any savings would be earmarked for reinvestment in front-line services. Presumably, the obverse is true: any costs will have to come out of front-line services.

Clauses 2 and 3 propose major reform for PCTs. I am not against that, but it is worth pointing out that those are fragile and untested bodies. On their slender shoulders will pass responsibility for managing large services, employing staff and negotiating with the trusts, and then they will have to do all the stuff in the NHS plan: modernise the service, involve patients and the public, lead on partnership with local authorities and liaise with the independent sector. I am not convinced that they are adequately resourced to take on all those roles. I want an assurance from the Minister that they will not inherit all the deficits from their predecessors.

Clauses 8 and 9 are about money. Every year, there is a huge redistribution of resources in the NHS—it is a larger sum of money than the revenue support grant—but with minimum debate and minimum accountability. On that allocation formula rests the quality of service that our constituents get. It is the so-called York formula.

The local government finance settlement is £36 billion year. There is an open and transparent system of distribution, and a debate about it each year. The spend on the NHS in the UK is £59.1 billion—a far larger sum—but the distribution system is not open, accountable or debated. On those obscure foundations rests the quality of service that our constituents get.

As has been said, under the new regime the money will go direct from the Department to primary care trusts. There will be less room for error. At the moment, it goes to the area and there is viring between the various trusts in order to ensure that there is no problem. There will be no room for manoeuvre under the new regime and a premium on right information.

Mr. Nicholas Winterton (Macclesfield): Will my right hon. Friend give way?

Sir George Young: I am afraid that I am against the clock. My hon. Friend will know that with the rate support grant there is all sorts of controversy, but if the

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Government do not get that right, the council tax can act as a buffer. There is no such buffer when it comes to that particular formula.

The independent panel set up by the Minister last year made it absolutely clear that the formula was wrong for Hampshire:

"We heard no evidence to support such a large reduction on the national needs 'norm' . . . Denying the area full funding will not make the population any less . . . health conscious."

I end with a helpful suggestion. How do we take the pressure off the NHS, while adhering to its principles? If we hold the view that money is part of the problem, how can we get the percentage of GDP up without upsetting the Chancellor of the Exchequer? I think that one should introduce what I would call NHS at work—an employment- based health insurance scheme complementary to the NHS—

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