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Mr. Milburn: As I have told the hon. Gentleman on very, very, very many occasions, both in Health questions and other health debates—[Interruption.] I have read the headlines, honestly. I say to the hon. Gentleman that he will have a much happier life if he does not believe everything that he reads in the newspapers. I try not to believe everything that appears in the newspapers, because it would drive me completely crazy. On the particular issue that he raised, he knows the position: it is a matter of local discretion in deciding the services that are provided to NHS patients.

Derek Twigg (Halton): My right hon. Friend will know about the difficulties that we have recently faced in Merseyside in relation to poor management practices, although he will also know that there is lots of good management practice as well. On that basis, I welcome the move to ensure that we have more devolved powers and that decisions can be taken locally. While massive investment is taking place in the health service, the public expect massive change in the management efficiency. That is why I welcome the proposal to give management power and discretion to local hospitals. On accountability,

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the PCTs will have the bulk of NHS money to spend in the not-too-distant future. How can he ensure accountability to the PCTs, making sure that those hospitals deliver efficient and good services in the locality?

Mr. Milburn: I agree with my hon. Friend. The simple answer is that primary care trusts will hold the budgets, and they will make the decisions, especially when they receive more and more of the NHS budget. By 2004, they will have three quarters of the total budget, and they will determine which services to commission from which provider. I should be surprised if every primary care trust, aided and abetted if possible by the Department, the Modernisation Agency and the Commission for Health Improvement, did not have a clear eye not only on the quality of services but on value for money, including, as my hon. Friend rightly said, the organisation and management of every hospital. Primary care trusts must do that when discharging their functions on the accountability of public money.

My hon. Friend knows that we publish reference costs every year. They spell out the difference in the cost of treatment between NHS hospitals. I should be surprised if primary care trusts did not increasingly use the reference costs manual as a bit of a Bible for commissioning services. It clearly spells out the differences in efficiency between hospitals. That is at least partly due to differences in efficiency in the management of hospitals.

Rev. Martin Smyth (Belfast, South): The Secretary of State will know that there are differences between not only areas but management styles. Does he agree that the larger hospitals have an advantage? Time and again, they have gathered more money from the health service but not always performed at the level that they should. That is to the detriment of other hospitals. Has he studied the results of the change of management strategy over the years? We have changed names and paid managers more money, but they have not undertaken the required management. We brought in outside managers, and they did not last the pace. Does he believe that a change of management will transform the health service? He speaks about not-for-profit trusts, but will large trusts continue to exist, eat up the money and rob other parts of the health service of the necessary cash to maintain the required standards?

Mr. Milburn: Like the hon. Gentleman, I believe that we all want high-quality management and services in every part of the United Kingdom. There is no doubt that we need to foster a new generation of NHS managers. It is inevitable that there has been a fixation today on poor NHS management, but we should bear it in mind that we have some fine NHS managers. I can give testimony to that. When we provided the star ratings last year and considered the different performance of NHS hospitals, there were three times as many three-star NHS trusts performing at the highest levels as no-star hospitals. Of course, that is fundamentally due to doctors, nurses and other staff, but it is also due to the managerial leadership in those three-star trusts. We should not be frightened of saying that. I agree with the hon. Gentleman that we need better management in all parts of the NHS, and

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more management when appropriate. Management and leadership hold the key to many of the changes that we need to unlock in local health services.

Mr. Henry Bellingham (North-West Norfolk): I thank the Secretary of State for his interesting statement. It has not escaped Conservative Members' attention that his best proposals were lifted from the last Conservative manifesto. Imitation is a form of flattery, but I want to ask a specific question about our local hospital. If it opts out and imposes better pay and conditions for its staff, but is subsequently taken back into mainstream NHS management, what will happen to the pay and conditions? Will they be reversed? Will the pay be docked?

Mr. Milburn: I notice that the hon. Gentleman and the Conservative party speak the language of opt-out, while we speak that of one NHS, one set of values, principles and standards, and one inspection. [Interruption.] Since the hon. Gentleman is so keen on private sector organisations, he would do well to examine successful examples. He will find that they are held together by a common ethos, but that they give local autonomy to local services when there is an interface between the service and the local consumer. That happens in the best private sector organisations, and must also happen in the NHS.

I read the Conservative party manifesto for the last general election; it was devoid of content.

David Taylor (North-West Leicestershire): It will be no surprise to the Secretary of State that his announcement will stick in the throats of many Labour Members like an unchewed pretzel. Will he reassure Labour Back Benchers that he is not performing a soft shoe shuffle through the private operation of public assets to their eventual private ownership? Will he reflect on the experience of our antipodean cousins? Private management of public hospitals in Australia has been shown to be fraught with problems and difficulties and has led a Committee of the Australian Parliament to recommend:

No such advantage has been demonstrated in practice or in the Secretary of State's statement.

Mr. Milburn: Nobody is advocating the privatisation of NHS services. I am not; the Government are not; nobody is. Indeed, it is quite the reverse. We want patients everywhere, not just in some places, to get high-quality NHS care according to the right NHS principles: care that is provided free according to need, not to the ability to pay. That is the right set of values. However, I simply do not believe that we can continue with the age-old structures, and assume that a national health service of 1.2 million people treating 20 million patients a year can somehow be run from a single office in Whitehall. That simply will not deliver the goods for patients.

Dr. Richard Taylor (Wyre Forest): I know that the Secretary of State is aware of a recent vote of no confidence in their managers, both at trust and health

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authority level, by a vast majority of consultants across the whole of Worcestershire. What does he propose to do about that?

Mr. Milburn: In keeping with the spirit of devolution, that is a matter for the management in Worcestershire. If the hon. Gentleman is concerned about that issue, he should raise it locally rather than with me.

Mr. John Baron (Billericay): Will the Secretary of State tell the House what criteria will be used to ascertain which hospitals are deemed to be failing, and which will become more autonomous? Will that depend on the star rating system? If so, as hospitals move up and down that rating system, will that signify a change of control?

Mr. Milburn: Yes, that will depend on the star ratings. Last year—the first year that we used the star ratings—we used certain criteria. I said at the time that the star ratings were far from perfect and that they needed to be improved—and indeed they do. This year, when we do the star ratings, with the involvement of the Commission for Health Improvement—and in future years with growing CHI involvement—the hon. Gentleman will see that the star ratings give a much more rounded assessment of performance, not only in primary care trusts but in NHS trusts too.

Point of Order

4.22 pm

Mr. Eric Forth (Bromley and Chislehurst): On a point of order, Mr. Speaker. You know, and we know, that you have recently deprecated the practice of Ministers making important statements outside the House, and then not even volunteering to make them here but having to be dragged here by a private notice question. You reminded us of that very recently. We have now had a blatant example of a senior Minister casually disregarding what you have said from the Chair. Is it now time for you to consider what further action you must take, and whether you might invite Ministers for private meetings—probably without coffee—to discuss this with you? Might you also consider whatever further sanctions may be available to you within the constraints of our Standing Orders and of Erskine May? The House will not put up with this any longer. You have given guidance, and correctly said what must happen, yet here we have another example of arrogant Ministers ignoring the House until they are dragged here.

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