Examination of Witnesses (Questions 100-119)
MR JOHN
BACON, MR
RICHARD DOUGLAS,
MR GILES
DENHAM AND
MR ANDREW
FOSTER
16 OCTOBER 2003
Q100 Dr Taylor: Before I come on
to waiting list surgery, just to welcome one thing and ask a question.
I think it was you, Mr Douglas, who said "We're working towards
standard tariffs across the NHS and the private sector."
What puzzles me is why the private DTCs are going to have a dual
tariff rather than a standard tariff. Why is that?
Mr Douglas: Two reasons, just
to start it off. One is that we have not yet got to a position
where we have refined our own prices sufficiently to have real
certainty about how good they are in every case. The second is,
we are asking these organisations to enter a new market, to bring
in new capacity from scratch, so there is an upfront start-up
cost in this which is not there in our average prices, but our
aim is to move to the position where we are all paying the same
price.
Q101 Dr Taylor: That is the aim,
after setting things up, to get to a standard rate?
Mr Douglas: The aim is, after
this five-year contract period that we will have, for us to get
to a single price.
Q102 Dr Taylor: Thank you. On to
waiting list surgery. You have explained that we pay a premium
for work in the private sector. Are we also paying a premium for
"out of hours" work in the NHS to attack waiting lists?
Mr Bacon: Do you mean surgeons
doing work at weekends and evenings?
Q103 Dr Taylor: Exactly that, yes.
You have given us a list of rates of pay outside normal or routine
hours for the nurses and the ODAs, but you have said that really
you do not know, it is up to individual Trusts what they contract
for their consultants to do?
Mr Bacon: The straightforward
answer to your question is, yes, we do pay a premium in the majority
of cases for surgeons who work beyond their normal hours. As Andrew
has explained, we are beginning to address that through the new
contract, if it is successful, but the simple answer is, yes,
we do.
Q104 Dr Taylor: Can you give us any
idea of a rough sort of scale of the amount extra that people
get paid?
Mr Bacon: The general answer is
that this is negotiated locally and, as we have said in our answer,
we do not collect it. Andrew, you may be able to comment.
Mr Foster: I am aware of an awful
lot of anecdotal information, as indeed I am sure you are, that
typically three and four times standard rates is what is charged
but sometimes people pay only two times, and then I have heard
of extreme cases, where there is a particular shortfall, of paying
six times. My guess would be it is triple to quadruple would be
something like the norm.
Q105 Dr Taylor: Are you trying to
move with the new contracts to a more realistic sort of figure?
Mr Foster: Absolutely, yes.
Q106 Dr Taylor: The qualified nurses
get time plus 30%, that sort of thing. Can we be assured that
is what you are trying to work to?
Mr Foster: We are trying to do
the contract, first of all, through this requirement that consultants
have to offer an extra four hours to the NHS at plain time rate.
That will give us one wedge of extra capacity. Equally, we have
now an agreed evening and weekend rate, which again is time and
a third, so we have the capacity to pay an established "out
of hours" rate, where we can negotiate that with local consultants,
where they are prepared to do it, I should say.
Q107 Dr Taylor: Is the vote on this
Monday?
Mr Foster: We are due to get the
results on Monday morning, yes.
Q108 Chairman: Can I ask a question
on continuing care. The Ombudsman ruled in some specific cases
about the issue of funding care, where it was felt that individuals
had to pay for the costs of nursing home care which should have
been covered by the NHS. Clearly, the implications financially
are quite serious, and I wonder what estimates have been made
by the Department of the implications for individual PCTs of that
particular ruling, in February of this year?
Mr Douglas: The estimates that
we have got coming through the accounts at the moment are probably
in the region of £200 million to £230 million and all
PCTs will have provided for that in their accounting last year,
so in normal accounts terms, they have scored that expenditure
basically now. There will then be a cash spend over a number of
years.
Q109 Chairman: That is on the basis
of existing cases currently where people are in continuing care?
Mr Douglas: That is on the basis
of existing cases.
Q110 Chairman: What about the implications
of that for future cases and future admissions?
Mr Denham: Because the figures
that Richard has been talking about relate to cases dating back
as far as 1996, obviously the ongoing impact is likely to be less.
The other thing which had happened in any case was that we had
asked the new strategic health authorities to agree revised criteria.
Almost all, I think, have now done so, and, in fact, many had
done so before the Ombudsman case came out, so I think things
were already factored in.
Q111 Chairman: So the existing budgets
will take account of the revised criteria, arising from that judgment?
Mr Denham: Yes, because some of
these things were going back five or six years, when very different
criteria were used, and, of course, after the Coughlan judgment,
different sets of criteria as well were put in place in many places.
Q112 Chairman: Can I move on to an
issue which I raised with Mr Foster last year, I think it was.
Right at the end, I lobbed him a question about redundancy costs,
and I think it is probably a little bit unfair, in that we had
not got specific questions within the Annual Report on it, but
we have this year, and obviously it is an area that I have been
interested in following for some time. The figures we have got
from your own report is that the abolition of community health
councils will result in around £12 million redundancy costs,
the replacement of health authorities with the SHAs, £45.3
million redundancy costs. I wonder whether the Department is looking
in detail at how these huge figures come about? Certainly, from
situations I have looked at in my own area, I worry about the
way in which we are being landed with some massive costs, taking
money out of the Health Service, where people are leaving the
Service following the numerous restructurings, the, what is it,
18 major restructurings in the last 20 years. Which is probably
one reason why some of us think all this money is going in, but
where is it going? Certainly there seems to be a huge part of
the budget going in this direction.
Mr Douglas: The numbers you quote
are from our reply. The CHC figure, the £12 million, I think,
is very much a maximum figure. I do not think we would expect
it necessarily to approach that.
Q113 Chairman: Why? Can I say, I
do know some individual packages because I talk to people, and
there is a fair amount of money being involved here, which, for
relatively young people who may perhaps have had a future career
in the Health Service, tremendous experience is being lost at
a huge cost to the Service financially?
Mr Douglas: In all of these, we
have tried our best, across the piece, actually not to lose people
who want to continue working and have a role continuing working
in the Service. The two major restructurings you refer to, I think,
affected around 20,000 staff. Within that, there was only a relatively
small number, in the end, that we could not find places for within
the system. We are dealing with some very major change here.
Q114 Chairman: Have you got any estimate
of the redundancy costs from next April, when the Commission for
Healthcare Audit and Inspection takes over the functions of several
of the healthcare bodies operating at the moment? What is the
cost going to be there?
Mr Douglas: I have not got those
figures with me today.
Q115 Chairman: Is it possible for
you to obtain them for us?
Mr Douglas: I can get those.
Q116 Chairman: Can I refer to one
example we have talked about, the Bristol situation, where I understand
the Chief Executive received a payoff of somewhere in the region
of £78,000. This is a case, I am told, from what Mr Douglas
said, where a £44 million deficit accrued in a year, and
he goes away with £78,000. It does seem a bit odd. Is this
correct, and, if so, what steps are being taken by the Department
to look at how on earth that amount of money can be paid to somebody
who, we would assume, actually has failed?
Mr Foster: I am afraid that I
do not know the details of that payment, but I would expect that,
as in other instances, there is a contractual entitlement to some
form of separation payment. The Trust probably will have found
themselves in a position that, had they not paid it, they might
have been brought before an employment tribunal and subjected
to even higher costs, but I do not know the actual detail of this
case.
Q117 Chairman: Is it possible, Mr
Foster, for you to look into it and perhaps let us have a note
on it? Clearly, if it is possible before we have the Secretary
of State, that will be helpful. Is it your understanding, where
we are looking globally at the figures, and certainly I had seen
some figures last year when I raised this question with you, it
does raise very serious concerns as to how these figures come
about, particularly where you have got this very real problem
which has occurred in Doug's area with this particular Trust?
Mr Foster: Just on the more general
point though, about the whole issue of the cost of change. As
you know, we are embarked on the most enormous set of reforms
to try to modernise the NHS and bring it up to date. Whilst the
individual figures that you quote for redundancy costs individually
look very high, they do have to be seen in the context of a pay
bill of in excess of £20,000 million, so in percentage terms
they are absolutely tiny.
Q118 Chairman: They may be tiny.
It would be wrong to give individual examples, but I do know of
quite a few examples and they are of people who have given indeed
good service but could also have continued to give good service
within the new structure but have not been employed, for whatever
reason. This is a factor, those of us that are worrying about
the extent of continuing change in the Health Service, this change
comes at a huge cost?
Mr Bacon: Perhaps we could distinguish
between the specific cases, such as the Chief Executive of North
Bristol, which we will give you a note on, and the more general
question that you are posing in relation to organisational change.
Clearly, the belief is that the structural changes we are putting
in place will deliver a more efficient and effective service,
so there is a gain to be had. I would just want to re-emphasise
the points which Mr Douglas made. Through all of these changes,
including the CHC changes, we have put significant effort into
ensuring that those people who want to continue their careers
in the NHS are able to do so. Inevitably, there are some folk
who choose to take this as an opportunity to break their service,
and where they are entitled to do so contractually we have to
respect that. There are other cases where there are just simply
not opportunities to place them. But in the vast majority of cases
we have put significant effort into ensuring that we help people
into new and good careers within the NHS without the redundancy
bill. Whilst I understand your point, I would like to reassure
you that we are very conscious of this and we try very, very hard
indeed to ensure that, both for the individual's sake and for
the cost's sake, we put effort into placing them.
Q119 Chairman: I could give you examples
of people who have gone out with rather a lot of money who have
come back working as consultants.
Mr Bacon: Ultimately, under their
contract, they are entitled to do so.
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