Select Committee on Health Minutes of Evidence

Memorandum by MSF (PS16)


  1.1  MSF has over 65,000 professionals employed in the NHS throughout the UK. We are therefore the third largest health service trade union. MSF is the major trade union for healthcare scientists organising, biomedical scientists, clinical scientists, physicists, pharmacists, radiographers, medical technical officer and medical laboratory assistants. We are the major trade union and professional body for community nursing organising health visitors, community psychiatric nurses, district nurses, school nurses, practice nurses and community nursery nurses. We are a significant union in therapy organising, speech and language therapists; art, music and dance therapists. We are also a significant union in mental health organising child psychotherapists, clinical psychologists and counsellors. We have a number of specialist sections that organise healthcare chaplains, general practitioners and hospital doctors, advisers in sexually transmitted diseases and complementary practitioners.

  1.2  MSF has a tradition of both organising around labour relations and professional issues. All professions have autonomy over professional issues that directly effect their occupation. As a result we believe that we produce an informed approach to issues that squares the circle between the need to give security to professions working in the NHS but also focuses on improving clinical practice.

  1.3  MSF believes that we are organised in key areas for the modernisation of the NHS and the delivery of healthcare in the 21st Century.


  2.1  Your Inquiry is very welcome because the current debate on this key issue is confused and bordering on the unproductive. A three dimensional issue is being debated at a two dimensional level.

  2.2  This is partly caused by confusion over the terms being used by those involved. The Prime Minister in his undelivered speech to the Trades Union Congress accused some of setting up "Aunt Sallies" which they then knock down. There is much truth in this statement. But then the Government itself has partly contributed to this process by not being sufficiently clear about how the private sector can productively be involved in the NHS, whilst retaining the public sector ethos that has sustained the unique character of the NHS. It has thus caused unnecessary alarm and concern.

  2.3  For clarity there should be agreement on the terms being used. The following terms derived from the Institute of Public Policy Research (IPPR) Commission's Report provide useful definitions:[1]

Market testing:

  Competition for the purpose of comparing the viability (in terms of cost and/or quality) of in-house work with that of alternative external contractors.

Private Finance Initiative:

  Arrangements whereby a consortium of private sector partners come together to provide an asset-based public service under contract to a public body.


  The full transfer of assets from government to the private sector.

Public Private Partnership:

  A risk-sharing relationship based upon a shared aspiration between the public sector and one or more partners from the private and/or voluntary sectors to deliver a publicly agreed outcome and/or public service.

  2.4  MSF has members in both the public and private sectors. In that sense we are a public private partnership in our own right. We recognise that the private sector has for many years played a major role in the NHS. We support this not to promote the commercial interests of the companies in which our private sector members are involved, but because this reflects the current situation in the NHS. The NHS as an almost monopoly supplier of healthcare in the UK has a myriad of relations with the private sector primarily through the provision of services, equipment, technology and more general supplies. The NHS has never been a public sector island in a private sector sea.


  3.1  The policy below on the NHS was unanimously agreed by the MSF NHS National Advisory Committee (NAC), representing members in over 80 occupations in the NHS on 23 July 2001. It has also been endorsed by the National Executive (NEC) of MSF. It is our definitive position.

  3.2  For the first time ever all major parties at the last election spoke in support of the principle of a National Health Service. The Government made promises in its manifesto to provide a quality Health Service focused on the patients need and this had to be done with the active involvement and co-operation of the staff. It has also been suggested that the involvement of the Private sector can generate investment and manage change in ways not available in the NHS.

  3.3  MSF has a proud record of support for the NHS both as a provider of healthcare free at the point of use, and of a public service providing employment opportunities, which reflect the high professional standards adopted by our members.

  3.4  After extensive discussions at the highest level with government, we believe that the aspirations of both government and MSF can be met.

  3.5  Elements of government still believe that the private sector can increase NHS spending. The recent IPPR report proves conclusively that this is not the case. Some in Government understand this. The second area to be improved by private involvement, is in introducing innovative techniques and the management of change.

  3.6  This is more difficult area to refute because we all acknowledge that the management of the NHS at National, Authority and Trust level often leaves a great deal to be desired. On the other hand we have many examples of the inadequacies of private management. The truth is that change cannot occur without the participation, professional guidance, initiative and drive of the workforce. Without wishing to comment on the ability of other unions and their members to adopt change, MSF believe their members are in a unique and authoritative position to improve standards in Health Care for the UK population.

  3.7  With a supportive management, MSF members in a number of areas have already demonstrated better use of resources to deliver a better service to the patient. Preservation of public service and members employment prospects in North Manchester are an example of working in partnership for change. We are able to do this because we are not just producers of healthcare but consumers as well. We understand the need for change and are determined to produce it. The breach of glass ceilings and involvement of all staff in the development of new and improved services is crucial. The status quo is not an option. If the manifesto commitments are not in place by the end of this parliamentary term we shall all be faced with a government who really believe in the privatisation of health care.

  3.8  MSF can demonstrate that well lead and organised staff can push aside the barriers of old style management and the false promise of the private sector to introduce radical change into the NHS, without compromising our deeply held principles of free and comprehensive health care.

  3.9  The professionalism of MSF members ensures they will take a responsible role on proposing the introduction of innovative change to improve the service for the patient. MSF can lead the way in our areas of work if the government provides the incentive of maintaining the high standards of the NHS and obliging management to act in partnership, following the example of Scotland.

  3.10  We set down only four principles, which we are not prepared to see breached:

    (1)  The concept of profit shall never come between provider and patient.

    (2)  Training, staffing levels and grades are determined by patient need not cost.

    (3)  Service improvement to the patient will take precedent over cost reduction.

    (4)  Effective change can only be achieved through partnership.

  3.11  Since we developed the policy there have been a number of developments.

    —  The Prime Minister has more closely defined his intentions, thus removing some of the more contentious areas.

    —  The Prime Minister, in his recent speech, acknowledged and welcomed the pioneering work which MSF and its NHS members were already carrying out to improve flexibility and service delivery.

    —  The Department of Health has developed and we have discussed with them the "Retention of Employment Model" whereby any private sector involvement would retain NHS staff in the NHS. MSF made clear that Private Sector scientific management of the Pathology service was unacceptable.

    —  MSF has put to the Secretary of State a number of proposals for consideration which would improve delivery of service to the patient whilst excluding Private Sector involvement.


  4.1  The financial arguments over whether PFI schemes constitute value for money have been well rehearsed and we have nothing to add to this debate. Figures from the Health Policy and Health Services Research Unit of the School of Public Policy, University College London questioning whether there is value for money from existing PFI projects appear robust and have not been adequately challenged by the Treasury or independent think tanks. Indeed the IPPR Commission[2] report has specifically accepted these arguments. The Inquiry needs to start drawing a conclusion on this vexed issue in order that we are able to proceed in a more rational and productive way.

  4.2  At the same time you should dispel the so-called "free lunch" argument put forward by some Ministers. The argument that without the private sector these hospitals would not have been built is becoming less and less credible. Ministers who continue this line of argument are being disingenuous and insulting the intelligence of many NHS workers. Ministers also claim that this is no different from taking out a mortgage—which is correct except in one crucial respect, the Government does not end up owning the asset!

  4.3  Treasury Ministers should be asked to justify their reasons why they wish to finance major capital investment requirements through these means when it is more expensive, when the Department of Health is under-spending within its expenditure limits and all PFI projects could be easily swallowed up in the PSBR.

  4.4  We are also concerned that this method of funding, stores up tax liabilities for future generations as the funding streams for PFI projects have first call on NHS funds. At a time when younger employees are increasingly been asked to make provision for their retirement we cannot support further additional fiscal burdens. This is not a "joined up" government approach. If the NHS is modernised today and funded through taxation, this must be raised from today's working generation.

  4.5  The other reason that Government seeks such arrangements is that they believe the private sector would bring in more effective change management and innovate, thereby modernising the service. Once again the arguments in this area have been well rehearsed by others. The Government argues that we cannot afford to be driven by dogma and that there is an absence of management capacity in the NHS. MSF's campaigns[3] in a number of areas lends us to partly concur with this analysis. However, our members suspect that there is a covert preference for private sector projects and change driven in this manner, reveals an abstinence of management rather than an absence of management.

  4.6  We believe that there are both good and bad public sector organisations and good and bad private sector organisations. In the age of the Marconi debacle we do not need reminding that the private sector is not always best as investors, which our members have discovered to their cost.

  4.7  In the absence of a more rational and acceptable explanation of the Treasury's preference for funding capital projects through PFI, MSF remains implacably opposed to its use.


  5.1  MSF is party to the Department of Health contact group which discusses matters of concern and has developed guidelines on PFI and market testing. We welcome this open partnership approach. These have ameliorated the effect of the worst schemes but have not prevented moves into the private sector. Further protection for our members is affordable by legislation (TUPE etc).

  5.2  The Retention of Employment model [See outline letter to the Service: Appendix One[4]] has been proposed by the Department of Health in response to the Staff Side view that PPPs or market testing of services creates a two-tier workforce ie colleagues working side-by-side on different terms and conditions of employment. However, the logic of this approach is that once this is agreed staff objections to the greater involvement of the private sector will be removed. This is not the case as the model does not address whether the involvement of the private sector improves patient care and gives real value for money. This is the substantive question that we believe should be addressed by the Inquiry. Besides some staff side organisations and contractors are also stating some major reservations about the terms of the model. However, MSF is committed to ensuring agreement on this model and we believe that this a major step forward that will address many of the concerns of Staff Side organisations. A more detailed brief on negotiations around this model is available on request.

  5.3  The model as first proposed took a simplistic view of NHS workers being a defined group with a supervisor who alone would be transferred to the Private sector. Such a policy would be entirely inappropriate where the contract covers more complex areas such as pathology laboratories. Here the clinical nature of much of the work and the supervisory responsibilities of almost all layers of staff means that such proposals would be inoperable.

  5.4  MSF has been at a series of meetings with the Prime Minister and the Secretary of State where the latest initiative to involve the private sector has been fully discussed. Once again MSF very much welcomes this approach and a full and frank exchange of views.


  6.1  The NHS Plan made a reference to looking at PPPs in Pathology and Imaging. MSF sought clarification regarding this reference. Subsequently the Department organised partnership forums involving MSF and other trade unions, professional bodies, the private sector and civil servants. Senior MSF officials and working members have had meetings with the Secretary of State. MSF again welcomes this discursive approach and we believe are close to coming to an understanding on the way forward.

  6.2  These Services are clearly considered to be clinical, even by the Department of Health's own definition contained within its PFI and draft market testing guidelines. The Prime Minister has given a commitment on non-privatisation of clinical services. However, this does not preclude private sector involvement or PPPs. This approach over emphasis the contribution that the private sector can make to modernising the service and minimises the contribution staff can make to the very same objective.

  6.3  Whilst we understand the imperative of the Prime Minister and the Secretary of State to "deliver" in this Parliament there has been no real or sustained attempt through partnership to involve the staff in service modernisation. This was lost opportunity of the first Parliament and this has been recognised by the Department of Health. Therefore, our members are at a loss to understand why market mechanisms are being considered before this has taken place particularly at a time when significant extra resources are now coming into the NHS.

  6.4  The prime advantage of modernising the NHS "in-house" is that the benefits accrue to the NHS and its patients rather than the private sector contractor. Key to this issue is the need for investment. The NHS Plan and the last two Budgets have addressed this issue in a significant way. MSF is seeking to create a virtuous circle where extra monies allocated by the Chancellor are invested to modernise the service and in turn the benefits derived are reinvested to provide further improvements.

  6.5  So what do we mean by modernisation? It means service improvement rather than cost cutting. It means skill mix of professional staff rather than cutting salaries through grade mix. It means upskilling the workforce through training and education not seeking to cut costs through a higher proportion of lower grades. It means deploying science and technology to its maximum potential. It means squaring the circle between demands for longer service provision (the 24 hour and seven day a week service) and staff demands, particularly carers, for more flexible and shorter working hours. It means more effective and transparent regulation of professions in order to improve clinical performance. It means greater public accountability, which is denied by private sector involvement.

  6.6  Where this approach is being adopted MSF has been fully involved. For example the new HR strategy for Professions in Healthcare Science[5] positively addresses professional issues including the status, registration, continuing professional development and career development of a sadly neglected section of allied health care professions. However, the fact of the matter is that the involvement of the private sector through a PPP in this area will cut across this policy before it has even begun to be implemented across the Service.

  6.7  MSF is fully prepared to welcome guidance and advice from the private sector where it can better inform the NHS. The use of management consultants may well be a better-controlled route to modernisation and improvement than wholesale acquisition of important and previously integrated sections of the NHS.


  7.1  So can there be a role for the private sector? The NHS has numerous commercial relationships with the private sector. The problem with this debate is that we believe that they are focused on the wrong issues or the Prime Minister's Aunt Sallies. If the wrong questions are asked the wrong answers are inevitable.

  7.2  MSF believes that we cannot afford to take an "Albanian economic approach" to modernising the NHS. Delivery on public services is the great challenge of this Parliament.

  7.3  Therefore, the focus of the debate should be conducted around the boundaries between the NHS and the private sector. In turn, the main determinant of these boundaries should be clinical factors: ie on a fair comparable basis does this improve patient care.

  74.  In order to avoid to be contradictory or misquoted we will give details of one example where we believe a positive relationship take place.

  7.5  MSF has a very large membership amongst scientific and technical grades. One evolving healthcare science is genetics which we believe will revolutionise healthcare: genetic identification assisting the design or selection of drugs to suite the individual; developing methods of modifying genetic make up to resist disease or change the persons response. The vast majority of research in this area is being conducted in the private sector. The fact of the matter is that the R&D budgets of the pharmaceutical companies in the UK outstrip the total public sector budget many times over. This is an area where a genuine increase in health care expenditure could be funded by the private sector. If the NHS is seeking to take advantage of this science it will have little option but to work with the private sector.

  7.6  Will this be a parasitical relationship with companies merely selling their diagnostic tests or cures, still many years off, to the NHS? Or should we instead develop a proper partnership to the mutual benefit of the NHS and the companies concerned? If we believe in the latter then how can such a partnership be founded?

  7.7  The NHS has a massive opportunity to act as a conduit for the data necessary for development work for the clinical tests which would follow and in this way accelerate the use of new tests through the Service. This would further improve health-screening programmes and add to an evidence based approach to medicine. The new tests will obviously create a commercial opportunity for the companies concerned.

  7.8  Likewise the NHS can work together with suppliers on new specifications on tests or equipment to improve their effectiveness. Such partnership can make them more user friendly so that nursing and laboratory assistants can take the tests, thereby freeing up the more skilled scientific staff to undertake the interpretative work requiring clinical judgement. The NHS can use its advantageous position to reduce costs in much the same way recent innovations in manufacturing have forced closer working relationship between manufacturers and their suppliers. The successful suppliers will be those that are able to meet the demands of the NHS for continuous improvement.

  7.9  It has to be said of course that none of this co-operation should proceed without the most stringent confidentiality and security controls in place.

  7.10  The view of our members is clear that the clinical border between the NHS and private sector are well established. But this does not prevent us looking at new ways to take this relationship forward in an evolutionary fashion, both growing the capacity of the NHS to deliver healthcare more effectively and efficiently and creating new commercial opportunities for the private sector.


  8.1  However, if we are true to our word and honest advocates of partnership, modernisation is where we should focus our attention. Often staff organisations can think of many reasons why change should not take place and few reasons why change should take place.

  8.2  MSF realises that this is in part a resource issue but this position should be greatly improved after the last two Budgets. MSF also understands that these resources will only be made available contingent upon being used to implement the modernising agenda.

  8.3  MSF has responded positively to this approach and has to date submitted a series of memorandum[6] to the Secretary of State on how we believe that acute and community services can be modernised detailing service improvements and efficiency savings. We are continuing this work. MSF recognises the need for change and our role in both identifying change and becoming a champion of those changes which will improve the quality and quantity of patient care.

  8.4  MSF has also negotiated directly with Trusts on service modernisation. Our biggest obstacle is the seeming lack of commitment by local Boards of trusts to openly engage in partnership style discussions on service modernisation. Often MSF has to intervene nationally with the Department of Health or the Secretary of State in order to get Trusts to discuss locally with our members their plans for the future. MSF believes this a wasted opportunity and a waste of a valuable resource—our members knowledge and commitment to the NHS. There is a subsidiary issue that Trusts are also not willing to take on "vested interests" and allow our members to take an enhanced role in providing a service. These unhelpful demarcations have no clinical resonance whatsoever. We reproduce our brief to the Secretary of State giving exemplar models of how we have been engaged in service modernisation in Pathology (Appendix Two).[7]

1   Building Better Partnerships: The final Report of the Commission on Public Private Partnerships-IPPR 2001. Back

2   Ibid. Back

3   The 29 Steps: booklet on the implementation of HR policies in the NHS: MSF 1999. Back

4   Not Printed Back

5   Making the Change: A Strategy for the Professions in Healthcare Science: Department of Health-February 2001. Back

6   MSF Briefs to the Secretary of State Nos. 1-5 (Number 6 on Imaging and Radiography in draft form)-MSF 2001. Back

7   Not printed. Back

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