Examination of Witnesses (Questions 964
WEDNESDAY 9 JANUARY 2002
MP, MR ANDY
964. Can I bid Members welcome and as it is
the first meeting of the New Year wish everybody a Happy New Year
and include the Government in that.
(Mr Milburn) That is very generous, Chairman.
965. Can I thank you, Secretary of State, for
coming once again and thank your officials particularly for the
additional memorandum that was sent on to us subsequent to your
last appearance. Could I ask you each briefly to introduce yourselves
to the Committee before we commence.
(Mr Milburn) Alan Milburn, Secretary of State for
(Mr Coates) Peter Coates, Head of Private Finance
in the Department of Health.
(Mr Foster) Andrew Foster, Director of Human Resources,
Department of Health.
(Mr McKeon) Andrew McKeon, Head of the
Private Sector Projects Team.
(Mr Macpherson) Nick Macpherson, Managing Director
of Public Services, HM Treasury.
966. Can I begin by one or two points on the
issue of the Concordat. Obviously this inquiry covers a number
of areas, including the Concordat. Secretary of State, you will
remember when we met last time I asked you a number of questions
about the issue of the use of the consultant workforce and raised
some concerns about my worry over the conflict between the work
in the private sector and within the NHS. Some of your answers
related to the issue of the need for private sector capacity.
Can I be explicit. Obviously I am concerned at this point with
the consultant workforce as opposed to the issue of capacity,
operating theatres or whatever. You were reminded of the fact
when we met last time when we undertook our inquiry into NHS consultants'
contracts we had some evidence suggesting a correlation between
lengthy waiting lists and private practice in some areas. I do
not know whether you have had the opportunity to look at the evidence
we received shortly before Christmas from a witness by the name
of Karen Bryson, who is the Director of Cancer Services Collaborative
for the South East Region Regional Office. If I can quote it.
I was interested in what she had to say. In talking about the
Concordat she talked about the fact that they had, and I quote,
"...encountered difficulties with consultants and some blockages
to transferring these patients into the private sector, to quote
some of them, because it would affect their private list."
She went on to say "Some were particularly obstructive with
it and we had quite a lot of difficulty circumventing that".
My comment was "You were saying there was some obstruction
by NHS consultants about moving people from their waiting list
into the private sector because that would impact upon their private
lists?" and Ms Bryson said "Yes". Is this an issue
that you are aware of?
(Mr Milburn) I have not seen that particular evidence,
Chairman. As far as issues of capacity are concerned
967. Can we come to capacity later on.
(Mr Milburn) No, no.
968. I am specifically interested in workforce.
(Mr Milburn) I am just going to say I think the workforce
is a capacity issue, with respect. Our big capacity constraint
is the workforce issue. We have problems on operating theatres
and beds in hospitals and all the things the Committee knows about
but the biggest rate limiting factor that we have as far as growth
in care for NHS patients is concerned is staff, whether that is
medical staff, whether it is nursing staff or so-called clinical
support staff by medical scientists and so on and so forth. Now,
as far as these issues are concerned about the relationship between
private practice that NHS consultants undertake, and have undertaken
as you know since 1948, and their NHS work, there are some issues
to resolve there, as you know. There are a number of ways that
we can do that. We have a particular proposal, as you know, which
we are negotiating on at present with the British Medical Association,
trying to form a new consultant contract. We have dealt with many
issues in those negotiations. The negotiations which Andrew has
been leading for us I think are going well so far but there are
some very tricky issues. Undoubtedly the issue of private practice
will be such a tricky issue. It has been unreformed as an issue
and as a contract for over 50 years. We have got a particular
proposal which, as you know, is that for a period of up to perhaps
seven years we would suggest that once a doctor has qualified
and become a fully fledged NHS consultant then they should work
exclusively for the National Health Service. There are other options
and other options which can be looked at but I think the options
that could be posited as an alternative to the one that we have
on the negotiating table are either unfeasible or, frankly, unaffordable.
969. You do not see any inconsistency between
what I believe is a very laudable aim in attempting to get this
seven year commitment and increasing, in a sense, the demand for
the private work of consultants by sending additional numbers
of patients into the private sector?
(Mr Milburn) No because I think
970. How can you square it? It does not seem
(Mr Milburn) I think you missed the differentiation
that really counts then. I think the differentiation is that under
the Concordat what we are doing is treating more NHS patients
and hopefully getting them treated more quickly. It just so happens
that some of that treatment under the Concordat and an increasing
proportion of the treatment under the Concordat is going to be
in private sector hospitals but, as I have explained to this Committee
in the past, the patient remains an NHS patient. They are treated
according to NHS principles, the care is free, they do not pay
for it, the state pays for it. It is as if they are a fully fledged
NHS patient because they are a fully fledged patient.
971. I fully understand that.
(Mr Milburn) There is a differentiation between the
time that consultants have. You see what I want, I want two things.
First of all, I think what we need is a bigger relationship not
a smaller relationship between the National Health Service and
the private sector in general. I think there should be a long
term relationship and not a one night stand. I think we want to
see improved capacity, more services being made available to more
NHS patients and if, as we all accept, there is a problem with
capacity as far as health care is concerned, and if we have spare
capacity, whether those are resources, infrastructure or expertise,
and we can harness that for the benefit of NHS patients, then
that is precisely what we should do. Indeed, today we are announcing
further expansions in the relationship between the NHS and the
private sector as far as pathology services and primary care services
are concerned. So that is the first thing that I think we need
to see: an expansion and not a retraction.
972. If this expansion is the way forward why
are we proposing to have a seven year commitment for new consultants?
(Mr Milburn) Because of the commitment to have exclusive
use of NHS consultants' time and expertise and talents, after
all we have trained them at considerable expense to the taxpayer
and I want them for the benefit of NHS patients. Consultants'
time falls into two periods generally. Actually the majority of
consultants, around 57 per cent of NHS consultants work on a whole
time basis for the National Health Service. A minority work on
a maximum part-time contractI think it is around 27 per
centand some of them work a large proportion of their spare
time, so to speak, in the private sector, others do not, but the
differentiation in the time that is available that a consultant
has is between work on NHS patients (and, frankly, for me that
can be work that is undertaken in a NHS hospital or, for that
matter, in a BUPA hospital or a GHCG hospital, provided the care
is for free and it is treating NHS patients as NHS patients) and
the privately paid for work that consultants do. What our proposals
are all about as far as the new consultant contract is concerned,
is trying to get a bigger share of NHS consultants' time for the
benefit of NHS patients. Where that care and treatment takes place,
whether it is in a private sector hospital or a NHS hospital is,
frankly, a secondary consideration. A primary consideration for
meand this is what we are seeking to negotiate, difficult
though it isis that when consultants first qualify, we
want to get a bigger slug of their time for the benefit of NHS
patients, and what we are proposing is an exclusive use of their
time for perhaps up to seven years. That has to be negotiated,
and I know you will have heard from the British Medical Association
and I know that the proposal is deeply controversial, and I have
got no doubt that it will be opposed in many quarters, but I think
it is the right thing to do. There is a deal on offer which is
pretty straightforward. We are prepared to pay NHS consultants
more in order to get more of their time to treat more NHS patients
973. Can I put to you a question that I put
to colleagues from the private sector who gave evidence before
Christmas. They indicated that over 70,000 patients had been treated
under the Concordat and these were people treated in the private
sector under the Concordat. I asked what the impact might have
been on the NHS waiting lists if those NHS consultants who were
working part time in the private sector were working whole time
in the NHS, and they could not answer that point. There was some
discussion at the Committee of Public Accounts recently and some
suggestion from one member that that would be the equivalent of
2,000 additional consultants in the NHS. I notice that your memorandum
since the last meeting suggests that 1,500 whole time equivalent
consultants would come into the NHS as a consequence of that.
Why would the Government not take that approach as opposed to,
as I see it, pushing more doctors into the private sector?
(Mr Milburn) Because it is not feasible, it may not
be legal, and it certainly is not affordable. There are a number
of options. What we could doand I am not saying we are
going to do this or that we have even considered it or are considering
it but these suggestions have been put to me by you amongst othersis
go for a total legal ban. We could say that NHS consultants are
only going to be allowed to work inside the National Health Service
and we could try to enforce that legally. I think the end product
of that in behavioural terms would be very simple. You would have
a whole host of NHS consultants that we need to treat NHS patients
upping lock, stock and barrel. Remember, there is a constrained
labour market. We do not have too many NHS consultants, we have
got too few, and they will up and leave and go and work in the
private sector. Why would they do that? Because, quite simply,
some of them, not all, can earn a lot more money. Certainly if
you are a surgeon you can earn a lot more money. I do not think
that is feasible, point one. Point two, you could try to compensate
them for a total and utter ban on doing any private work. I think
that is unaffordable and we have done some back-of-the-envelope
calculations looking at what it would cost. If you were to do
that either what you could do is simply compensate the people
who are currently earning quite a lot of money from working in
the private sector. There are some people who earn £50,000,
£100,000, some well in excess of £100,000, and you could
compensate them and give them a bigger NHS pay packet. I think
that is a pretty perverse thing to do. You would be paying the
people who had done more private work and less NHS work more than
the people who had been doing a lot of NHS workgeriatricians,
psychiatrists, physicians, A&E consultants who, by and large,
work in the specialties where there is not a lot of private practice.
That seems to me to be an illogical and unfair thing to do. Or
the alternative is that you would have to compensate every consultant,
every single one, for the potential loss of private sector earnings
even though a majority of consultants probably do not have private
sector earning power. We reckon that if you assume that consultants,
if they are working in the private sector, might earn between
£50,000 and £100,000 as a matter of normality, given
the fact that we have got 26,000 NHS consultants, that would cost
us a cool £1 billion before we had even started and I do
not think that is a sensible use of NHS resources because, in
effect, what we would be doing is paying huge dead weight costs
at public expense for very little benefit. In other words, we
would be paying people a lot more money for compensation when,
in fact, they were not even working in the private sector. There
is a final option which is that we continue with the current confusion
and mess because I think it is confused and I think it needs sorting
out. Our conclusion is that our best option is the sensible compromise
option that we put forward in the NHS Plan which is trying to
get NHS consultants when they are newly qualified for a period
of up to seven years to work exclusively for the National Health
Service. As you know, that has got to be negotiated with the British
Medical Association and we shall see how that goes.
974. Before I bring some of my colleagues in,
can I pick up one other point Miss Bryson made to the Committee.
Her argument was that waiting lists would be sustained in her
area. She said that the consultants concerned were not wanting
their own private lists to be affected so even though these people
were moving to the private sector under the Concordat, the consultants
were unhappy about losing patients from their private lists. She
suggested that there was a need to look at the management of the
waiting lists. That is an area that you have looked at. Can you
tell us where the Government is on the question of removing it
from the actual consultants?
(Mr Milburn) Let me say, first of all, that it is
very, very important when we highlight these problems that we
do not forget the context for this which is that the overwhelming
majority of NHS consultants are doing a brilliant job for the
National Health Service and are probably over-fulfilling their
contractual obligations rather than under-fulfilling them and
working pretty damned long, hard hours to treat a lot of NHS patients.
I would not want anybody to get the impression that somehow or
other we have a whole host of NHS consultants who are not pulling
their weight because that simply is not true. As far as issues
about how best waiting lists are managed, I think that is directly
related to how best we manage NHS consultants' time. At the moment,
as you know, there are within the NHS consultants' contracts a
whole host of so-called flexible sessions. We have as a negotiating
brief in these negotiations with the BMA an objective to ensure
that there is better planning of NHS consultants' time, so that
we get better and more treatment to more NHS patients. That is
something that we have got to hammer out in negotiations and I
do not want to get into the detail of what we have been talking
about in the negotiations for obvious reasons, I do not want the
negotiations to be compromised, but so far I think Andrew would
say they have gone pretty well and we have got to continue and
hopefully reach a conclusion before too long.
975. Secretary of State, I must say there was
a certain irony listening to your comments at the beginning of
this session because, of course, when the last Government paid
for NHS patients to be treated in private hospitals that Government
was accused by some of your colleagues of creeping privatisation
of the National Health Service and yet you are now doing it with
a vengeance. What I wonder is you have opened up a Pandora's Box
in recent weeks with other areas of what has been accused by colleagues
of your's in the past as privatisation of the health service.
For example, hotel charges, something that even Margaret Thatcher
in the height of her powers ruled out. We have seen you floating
the idea that maybe the health service is open to privatisation
in certain areas like hotel charges and I would like to just press
you for a short time on those. Would you rule out charging hotel
charges for things like food in hospitals?
(Mr Milburn) I do not think we should charge for food,
976. At all?
(Mr Milburn) No.
977. So why float it?
(Mr Milburn) I have not floated it. Where have I floated
978. The Independent on Sunday.
(Mr Milburn) Well, do not believe everything
you read in the newspapers. You will be sorely disappointed in
life, Mr Burns. I am day in and day outI do not read the
979. I am sure you are. I am sure you do not
believe anything which has not been spun by Millbank but one does
come to believe that
(Mr Milburn) Shocking, shocking allegation and I hope
that you can substantiate it.