Select Committee on Health Minutes of Evidence

Examination of Witnesses (Questions 20 - 39)



Sandra Gidley

  20. We have just had the announcement of this year's jam jar of money to solve the problem, big though it may be. You have admitted that you would like to see a long term solution to this but it is not quite as easy as everybody is making out because the problem that is being highlighted locally with the independent, private hospitals is that they want to deal with their private patients first, the ones who fund them. They do not feel inclined to commit, because they do not have the capacity, to taking more NHS patients. They are quite happy to take the patients short term when they have the capacity but there is a gradual creeping and a pressure being put on these hospitals so that more and more cases are taken. This is having an effect on people who pay for their private health care. Bizarrely, people in the private sector are now waiting three months for certain hospitals and certain consultants. I have had people ringing up and saying, "I am paying twice and I am still not being seen quickly." Do you feel that it is fair that patients should pay twice and still have to wait because the private hospitals are full of NHS patients?
  (Mr Milburn) I do not believe that private sector hospitals are full of privately paid for patients. In fact, I know that is not the case. We are running at 89 per cent occupancy now in the NHS. BUPA and other private sector providers are running probably at 55 or 60 per cent occupancy, based on private sector customers paying. They have 30 per cent occupancy free. There is a very simple choice. We can say we do not like the private sector and we are not going to do business with the private sector. There are all sorts of difficulties in getting into bed with the private sector. Or, we can do the sensible and mature thing which is to take advantage of that spare private sector capacity for the benefit of NHS patients. That is what we are going to do. Indeed, we have been in discussions through Andy and other officials over the course of the last few months with the major private sector players who indicate three things to us. One, that business is increasing as a result of the Concordat with the National Health Service. Indeed, BUPA tell us that the number of NHS patients has increased three-fold in their hospitals. Secondly, they still have spare capacity available. Thirdly, they tell us that they can accommodate a doubling in the number of NHS patients coming through their doors. At a time when my biggest problem is not the shortage of cash - although more cash would always be helpful—

Julia Drown

  21. Especially in Swindon.
  (Mr Milburn) The biggest problem is the shortage of capacity. I would be foolish to say to BUPA, CHG or BMI, "We do not want your capacity because somehow it is contaminated goods." What I am interested in is getting the best benefit for the NHS patients. That is what I am going to do. If that causes a problem for our private sector partners, that is a problem they have to conjure with because the result of us doing more business with them is that they get more money.

Sandra Gidley

  22. We are talking Hampshire here so perhaps you should get out a bit more. One of the other problems is, with the constant reorganisations in the Health Service, how do we know that there is going to be enough long term stability so that we can forward plan, because there is another initiative nearly every week coming out of the Health Department. There were 25 during the consultation document's release during the recess. Are we going to have a period of stability?
  (Mr Milburn) I am sorry that we are doing too much.

  23. It might be better to concentrate on doing fewer things well.
  (Mr Milburn) We will try not to do so much in the future. If that is what you would like us to do in Hampshire I am quite happy to oblige and I am sure the people of Swindon will be absolutely delighted. We have a long term plan. It is called the NHS plan. It is a plan for ten years and that is what we are going to implement. There are various aspects to the NHS plan. I do not know whether you have had a chance to read it. If you have not, I will gladly send you a copy of that and you can see the range of things that we are trying to do. What we are trying to do is change the NHS in all respects. What frustrates me about the debate on NHS reform is that although what we are talking about today is really important because it does provide more capacity in the system and means more care for NHS patients, sometimes reform in the NHS is characterised purely as the NHS developing a new relationship with the private sector. It is one part of the reform programme but it is by no means the whole of the reform programme. What we have to do is breakdown the demarcations between the staff, as we were discussing at last week's hearing, ensuring that the relationship within the public sector between health and social services improves; making sure we make the optimum use of the skills within the National Health Service, the extra IT that we need to get into the National Health Service. These are at least as important as the work that we are now doing with the private sector. My own view about this is that we would be incredibly foolish to turn our backs on spare capacity where it exists and where it can bring benefit to NHS patients.

  24. I admit there is capacity but it is not always long term and it is not all around the country so different solutions need to be prepared for different parts of the country. You have just mentioned breaking down demarcations between staff. If more NHS staff are attracted to the private sector because of the increase in the Concordat, would you say that was a triumph or a disaster for government policy?
  (Mr Milburn) The crucial thing is what happens to the NHS patient and whether they get care provided for free, according to need, not ability to pay. What is happening in the NHS today is that there is an increasing range of providers in play. The dominant provision is still through mainstream NHS hospitals but what we are also seeing, as we develop the Concordat, is growth in NHS treatment taking place in the private sector hospitals. As far as the staff issues are concerned, if we were to see the seepage out of NHS staff, particularly some of the skilled staff where we have really big shortages, into organisations that were not providing care for NHS patients, that would be a concern. What we are talking about here, remember, under the Concordat is precisely making more care, more treatment, more operations available to NHS patients.

John Austin

  25. You refer to the question of capacity and the Chair referred to consultants and consultant time. You talked about beds not being available. We all know that in the past beds have been cut dramatically, particularly acute beds. It is not the physical capacity that has disappeared; it is the staffing for those beds that has disappeared. When we talk about a shortage of capacity, it is because there are not enough nurses or whatever in the NHS hospitals. There is not some magical, additional pool of people. There is one pool of nurses. Some work in the private sector and some work in the NHS. Are we not just continuing to compound the problems of the NHS hospital and its ability to retain nursing staff?
  (Mr Milburn) No, I do not think we are and I would be concerned if that was happening, since we have had such an enormous effort in getting nurses back into the National Health Service, an effort incidentally which has paid dividends. We have a lot more nurses coming through all the time. It would be a concern to me, as I think I said last week, if we were getting nurses in through the front door and then found, through whatever means, they were leaving by the back door. There are two points to this. First, I do not think it is true that the only problem in terms of capacity that we have is just staff capacity. I was not saying that the only problem was theatres, beds or IT facilities. In Kent right now we have capacity constraints and NHS doctors and nurses who walk down the road to a private sector hospital and operate on NHS patients in their NHS time. Why do they do that? They do that because their hospital is full. Maybe over time we can put that right but do not let us pretend that somehow or other the capacity constraints that the NHS faces today, the shortages that we face—and we all know the reasons for that: lack of investment over 20 or more years - are just capacity constraints and shortages. They are about staff. They are about infrastructure too. You only have to walk into most local hospitals - Greenwich Hospital would be a good example - to see precisely what the result of under investment has been. Frankly, shoddy buildings, dilapidated equipment, equipment that breaks down all the time and a shortage of capacity. The first point is it is not purely about staff constraints; it is also about real hardware constraints - i.e., around operating theatres and beds.

  26. Greenwich Hospital has closed and the new Queen Elizabeth PFI Hospital is open: state of the art, absolutely superb facilities there.
  (Mr Milburn) That last one was terrible though, was it not?

  27. You have a private sector hospital with spare physical capacity. A private sector hospital is running for profit. It is not going to staff that extra capacity if it has not filled it with private patients. Therefore, if you then give it an incentive to take NHS patients, it will recruit the staff in to cope with that number of patients. The only pool it can poach them from is from the NHS.
  (Mr Milburn) I do not think necessarily think that is right. I am not sure on what terms BUPA employ people but it is certainly true you could make quite a convincing case that BUPA does not employ a huge number of doctors. It has some medical officers in its hospitals but by and large it relies upon NHS consultants and so on. The same is not true of nursing staff. The private sector is quite a big employer of nursing staff. I cannot remember what the numbers are now but they do have their own staff on their books, so to speak. The question is whether or not from the private sector point of view and, more importantly, from my point of view we are making optimum use of the resource that is available. It is like the hardware. If the hardware is lying idle in a private sector hospital - i.e., the bed, the operating theatre, the critical care facility - equally if there is software - i.e., the nurse - lying idle, not being used to maximum efficiency, that is a resource that is being wasted. What we are trying to do is to maximise the capacity all round.


  28. You said a moment ago that the problem was not so much resourcing, although obviously more resources would be welcome, but capacity. You will recall when the Prime Minister announced the NHS national plan I had a slight difference of agreement with him on emphasis rather than anything, in principle, over the use of the private sector. I suggested, if we need that capacity, although the private sector in many respects is having difficulties in some areas, why do we not simply buy that capacity and take over those hospitals. He said that was not possible but I recall over the recess period we did do that. Why do we not do it more often?
  (Mr Milburn) The London Heart Hospital, which is the hospital you refer to, I bought for £25 million and we got a really good deal because it was an asset that was worth £35 million—state of the art, fantastic. What is more, we also bought the staff, the nurses, the doctors and the back-up staff too. They came over to the NHS. That was a hospital that had run into trouble for reasons that we need not go into here. I acquired that asset because I thought it would bring benefit to NHS patients, including being able to do more heart operations on the NHS which we really need to do a lot more of and a lot more quickly. There are private sector hospitals that are running now on very low levels of occupancy. What we are looking at is whether or not we can more effectively not just contract with a private sector hospital running at low levels of occupancy; but effectively buy up for a period of a number of years that total capacity and monopolise it for the benefit of NHS patients. If you ask me about whether, if another London Heart Hospital came along with that standard of care in the right place, in London where we know we have particular capacity constraints that colleagues will recognise, if there were something similar to that, I would potentially be interested in making a further purchase, potentially I would. I stress again that it would be one of a number of relationships that we need to build with the private sector. I outlined some of them in answer to Mr Burns's earlier questions.

Dr Richard Taylor

  29. Secretary of State, I have no objection to using the private sector in the short term as an expedient to help out but I would like to explore some of the objections to using it in a much wider form in the long term that have been mentioned already. What we want are actual facts. The private sector will cream off the easiest, least stressful bits from the NHS because it does not do much in the way of emergency care which is the sort of thing that is unpredictable and most stressful. Therefore, I am quite sure nurses are leaving. Why we have shortage of capacity with theatres in Worcestershire is that theatres are sitting unused in the NHS because the nurses have left. What we need to know is the facts. What have nurses who have left the NHS left to go and do? Have they left nursing altogether? Have they gone to the private sector? Have they just moved out of the hospital service into the community service? The only way you can answer the worries about the long term loss of nurses to the NHS is if you produce the facts to show that they are not being lost.
  (Mr Milburn) I am happy to share what data we have on that. There is one fact I can share with you and that is the number of nurses is rising, not falling. With respect, I am sure you were not saying that they were falling but your remarks could have given that impression. The number of nurses is rising quite steeply. What is more, the number of nurses coming through the pipeline is set to produce even more increases than we have seen in recent years in the years to come. For example, you know as well as I do that the number of applications for nurse diplomas and nurse degrees is up massively. They are going to produce a cohort of future nurses on a scale that we have not seen in this country maybe since the NHS was formed. You ask me where nurses are going to when they leave. My understanding from the figures, as I remember them, such as we have them - I am very happy to let the Committee have what we have access to - is by and large when nurses leave they leave for the obvious reasons. Most nurses still today are women. They go off and have a family. Our problem is that historically we have not been too good at getting them back. We need to get better at that and that is why we are exploring how we provide child care and all of these things. Is there a big seepage from the NHS into the private sector? As I remember it, no, there is not, but I am happy to share the data with you.

  30. I was not expecting an off the cuff answer in all detail. What I am asking for is a future survey over the next few months to see exactly where the nurses are going. You say there are more nurses. We certainly do not notice it in Worcestershire with empty theatres that cannot be staffed.
  (Mr Milburn) With respect, that is not such an intellectually robust case.

  31. It is a fact.
  (Mr Milburn) I do not dispute that. There are empty theatres all over the place. There are too many people on the NHS waiting lists, waiting too long for treatment but do not fall into this fallacy that unless you solve every problem you have not solved any problem. The truth is there are more nurses and there are more nurses coming through. I am sorry you do not feel you see them in Worcestershire, but I will look into how many nurses are employed in Worcestershire and I bet it shows an increase.

  32. I have surgeons approaching me who have not done routine prostate operations for 14 months because the theatres that they would do them in cannot be staffed. The one way you will help is by putting money in and at least they will be able to do some of these in the private sector as a short term expedient, which is excellent. I do not know what to say to this chap who has not been able, because of shortage of nurses to staff theatres, to do a routine prostate for 14 months. I have constituents writing to me who are getting up 15 times a night and they cannot be operated on.
  (Mr Milburn) I understand that. As I said right at the outset of my remarks, the biggest problem we have today is shortage of capacity in the NHS. If I could click my fingers and conjure magically out of thin air more trained nurses for Worcestershire today, I would do it for you. You know I cannot and I know I cannot, so what we have to do is grow them or bring them back. We have brought, in the last 18 months alone - it might be the last two years - a further 9,000 nurses back who left the NHS and have now returned. Why has that happened? Because we have made nursing more attractive by giving them better pay, by improving child care, improving flexibility and accepting a very simple fact: that they are in the key positions. As I said last week, there is a labour market shortage. The people who pull the strings are not the employers; it is the employees. What we have to get much smarter at in Worcestershire and elsewhere is making sure that we can attract people back on terms that are agreeable to them. That means some changes around the very way we employ people, in my view.

  33. May we have the figures?
  (Mr Milburn) Absolutely.

Jim Dowd

  34. The whole question of private sector involvement, whether through the Concordat or elsewhere, must be the best possible service to the public and the best possible value for taxpayers' money. Any device we can use to achieve those twin objectives is useful, whether it is the opportunist acquisition of the London Heart Hospital or a more sustained approach. I do not have the difficulty that other Members of the Committee seem to have in grasping that. You mentioned today and last week the capacity in the NHS sector health care - on an earlier figure, you gave us about 98.5 per cent - is about 90 per cent. You said you would like to see it lower. You said that last week as well. That troubles me because the acute sector in particular is astonishingly expensive. There is a huge investment of taxpayers' money tied up in that. I accept we cannot run them at 100 per cent because of pressures on staff and individuals, but the second of my twin objectives, getting the best possible value for public money, means we have to use them as effectively as possible. In your view, if 89 or 90 per cent is too high, although that already implies ten per cent slack in the system, what kind of target would you be looking at?
  (Mr Milburn) That is a very good question. We have commissioned research from York University which the Committee can see, which indicates that if you get occupancy rates in excess of 82 per cent you start getting a higher level of cancelled operations taking place at the last minute, which is hugely frustrating, not just for the patients but for the members of staff as well. Staff do not like having to ring up the patient on the morning of the operation to say it is cancelled. Occupancy levels give you higher levels of long waits in accident and emergency departments because the whole system gets log jammed. The beds are too full partially because we cannot get a lot of old people out of the hospital and back home for the reasons we discussed last week. The consequence is not only felt at the exit end of the hospital; it is also felt at the entry end, where people cannot get out of accident and emergency or out of the medical admissions unit onto the acute ward because the beds are too full. What we have been looking at very closely is what we can then do to get occupancy levels down from around 89 or 90 per cent at the moment across the NHS. In some of the areas where we have the biggest problems they are higher still. We want them down towards levels of 82 per cent and some of the things we will be saying tomorrow will be around the progress that we can make towards that. That is really where we need to get to. It will take some time to get there. I know that sounds as though, on the face of it, somehow or other we are making the hospital sector less efficient. That is not quite true. The problem is that it becomes less efficient the more you get above 82 per cent. 89 per cent makes it inefficient because you have all these patients stacked up either in the acute wards or alternatively in the A&E department. That is partially a consequence of getting the relationships right in the hospital between the A&E department and the acute wards further through the system and then the wards and what happens in terms of discharging arrangements.

John Austin

  35. You will remember this Committee in the last Parliament looked at regulation in the private sector and I think your predecessor felt that regulation of the private sector was not the responsibility of the NHS. We felt it was the responsibility of the Department of Health. Given that you want to build this partnership, will you reassess the advantages of bringing the private sector within the same regulatory framework as the NHS?
  (Mr Milburn) We have to look at those issues. We have a mechanism with the Commission for Health Improvement inspecting NHS hospitals and the National Care Standards Commission effectively regulating the private and voluntary sector, including residential and nursing homes in so-called social care. The Commission for Health Improvement, as you remember, when we put this through the Health and Social Care Act, and the National Care Standards Commission are empowered to work together jointly, calling staff backwards and forwards and effectively subcontract some of their operations, one to the other. That is something we want to see developing. We want to see how it works. Remember, the National Care Standards Commission is not yet in being and will not be until April next year. There is an important caveat. The Commission for Health Improvement can follow the NHS patient. If the NHS patient is treated in an NHS hospital, the Commission for Health Improvement will obviously go to the hospital and do its periodic assessments. However, if the NHS patient is treated in a private sector hospital under the Concordat, for example, the Commission for Health Improvement can still follow that NHS patient. In a sense, we already have the makings of what I think the Committee were concerned about, which is to have one means of regulation for the care system. What I would want to see is whether or not those relationships and organisations that we have put in place really are delivering the goods both to the patient but also, importantly, for the service provider because I do want to avoid a situation where we have over-inspection and it becomes overly bureaucratic and so time consuming, particularly for clinicians providing information and having endlessly to talk to different visiting groups and inspectors so that they cannot get on with the job and what they are paid for which is to treat patients. The answer to the question is what we need to do is make sure that we have a means of ensuring that regulation is coherent. I think we probably have the means to do that. I want to see how it works. If I am not convinced that it is working properly, we will need to revisit it.

  36. The time frame.
  (Mr Milburn) The National Care Standards Commission comes into operation in April. The Commission for Health Improvement and the NCSC have already had the appropriate discussions about how they can pool resources, and so on and so forth. I think we want to give it a year and see how it is operating. I will be quite happy, it is in the Committee's interest, to report back, if you want me back. I can send you a note about what our assessment is. If I am not convinced it is working we will need to revisit it.

Julia Drown

  37. I would like to explore the areas in which private sector involvement might be appropriate in the National Health Service and where it might not. You said in speeches that areas like pathology and the diagnosis of treatment are right for further private sector involvement. You also mentioned things like private sector management, stand-alone surgery units and IT systems, in those areas why can the National Health Service not improve its performance? What, in particular, are the obstacles that face the National Health Service?
  (Mr Milburn) It can and I hope it is. If you take somewhere like pathology or radiology, which in many ways are the forgotten clinical services in the National Health Service. I do it as well, we talk about doctors and nurses, you do not talk about pathologists or radiologists or therapists, and so on and so forth. The truth is the doctors and nurses would not be able to do their jobs without their back up. It is worth remembering that six in ten people who come into hospital now will require some sort of diagnostic test. Unless we have decent up to date pathology labs and radiology services then we are going to encounter enormous problems in getting the waiting times down for treatment. I think you are aware, as I am very painfully, these so-called back office clinical services have suffered even more neglect than the front of house clinical services. You only have to walk around most pathology labs to see that is the case, equipment is pretty outdated, the staff, by and large, have an older age profile than many people who work in the National Health Service and the rates of pay have been pretty appalling for people. We have begun to make a difference around that. Last year, or earlier this year, we increased the rates of pay for pathology staff quite markedly, which is a very, very important signal and a first start for those staff. They are scientists, they are technicians and we should treat them as such, they are not second rate citizens. We are beginning to make a difference there. There is money going in. As you are aware after the last Spending Review we established what we called the Pathology Modernisation Programme which has spent so far £20 million on 35 projects across the country trying to modernise the equipment, trying to make sure it is up to date, trying to make sure that if the National Health Service front of house is operating 24 hours a day one of the big problems we have is in A&E, the A&E department is obviously there 24 hours a day but the radiology services might only be there from 9 am to 5 pm, then you wonder why people are stuck on trolleys or occupying a bed needlessly just waiting for a test.

  38. Insofar as there are barriers and people were not paid well enough in the National Health Service, that barrier is going down. Indeed, there is an issue there that partly in these areas it is going against one of the principles that you suggest in your paper that is important, that you would not want to bring in private sector involvement if it would involve having to recruit staff in areas where there was a shortage of staff, which is the case in pathology and parts of radiology. Why do you think this particular area is right?
  (Mr Milburn) Essentially we have two big problems, one, we have a shortage of staff capacity. Radiology, for example, that is our primary worry, although we are well behind on the provision of CT scanners and MRI scanners compared to other countries in Europe we are putting that right. There is a huge investment going in through mainstream capital and also through the new Opportunities Fund and that is going to really make a difference, particularly around cancer, and so on and so forth. The second problem is round the shortages of capacity in relation to equipment and infrastructure, there the private sector can play a role. The third area is an important one, at the moment the private pathology services in this country are a very small element of the National Health Service in this country. Private pathology accounts for between five per cent and seven per cent of overall National Health Service pathology capacity. What we do know is that in the private sector there is spare capacity in pathology. What we need to do is to discuss with private sector providers of pathology services whether there is not a means of garnering that investment, their resource, their spare capacity for the benefit of National Health Service patients.

  39. Is that in consultant time, equipment or technician time?
  (Mr Milburn) At the moment this is service capacity, it is not just that they are better equipped and more modern but the services that they have could take more National Health Service custom. What we are doing—this might be useful, I am not sure we mentioned this in the memorandum or not, if we did not forgive me, we have this Pathology Modernisation programme underway, which is largely being focussed on very small-scale projects until now—in this financial year is contemplating spending a further £8 million on four large scale pathology modernisation programmes dotted around the country. It is entirely possible that one of those will be a PPP with the private sector.

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