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Stephen Hesford (Wirral, West) (Lab): The hon. Member for Eastbourne (Mr. Waterson) has said that the debate is timely, and I think that he is right.

Conservative Members have mentioned the word, "embarrassment", but the two go hand in hand. One of the reasons why the hon. Member for South Cambridgeshire (Mr. Lansley) was unable to answer questions about the patient's passport is that one Conservative party leadership contender likes them, while the other says that they are old hat. Until Conservative Members work out that conundrum, it is
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embarrassing for them to call a debate such as this. My right hon. Friend the Secretary of State has said that she is proud of what the Government have done for the NHS, and I am proud of how the NHS delivers in my constituency—if I have time, I will raise some relevant examples.

Conservative Members should also be embarrassed by their motion. I have already questioned the sum of £600 million, which is a gross exaggeration, so I am glad that the hon. Member for South Cambridgeshire is back in his place. It is an exaggeration, too, to speak of £1 billion. When my right hon. Friend the Secretary of State talked about administration costs, the hon. Gentleman tried to focus on management costs. According to the NHS Confederation, there are fewer people in management, as a percentage of the work force, than in 1999.

My hon. Friend the Member for Crawley (Laura Moffatt) indicated how deficits occur. Conservative Members must understand that we inherited an appalling situation. In many cases, any deficits that occur have been rolled over from year to year as a result of inherited deficits from the Conservatives' time in government. My right hon. Friend the Secretary of State was right to point out that we inherited what Wanless described as a £3 billion cumulative under-resourcing of the NHS. We have been trying to put that right, as well as increasing investment.

I want to talk about the situation in my constituency. It is often valuable advice for hon. Members to speak about that which they know, and I know the situation in Wirral very well, having for eight years met people from all parts of the NHS every three months in order to understand their story as it has unfolded. It can be painful to shift resources from the acute sector to the community sector to create a primary care-led, patient-led NHS. That can lead to budgetary difficulties. To deal with that, the Government will in due course publish a White Paper on care out of hospital.

One of the reasons for making primary care trusts focus more on commissioning is to ensure that there is patient choice and direct management control. That means that there is no power struggle between the PCT and the acute trust, as has sometimes happened, and resources can be directed towards an NHS that is properly redesigned for the future. My local acute trust has taken the necessary action to design a service that leads to recurrent savings in resources. As a result, its deficit has disappeared. I commend that approach to Members on both sides of the House and suggest that they should have a conversation along those lines with their own acute trust management.

When Labour came to power, the budget for my acute hospital was just over £100 million; now, it is nearly £300 million. It is one of the largest non-teaching hospitals in the country. It was an 800-bed hospital; now, it has nearly 1,000 beds. I do not recognise Conservative Members' accusations of bed cutting. Indeed, I had the honour of opening a 12-bed high-dependency unit costing £1.2 million just before the 2001 election.

If Conservative Members want a serious debate, I thoroughly recommend that they first have a conversation in their own patch to see whether their NHS management is doing all that they could with the money that we have provided, which is more than enough.
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5.55 pm

Tony Baldry (Banbury) (Con): The House heard an incredibly complacent speech by the Secretary of State. She has fallen into the trap that all Governments fall into in their dying days—that of having her officials only take her to see Government flagship projects. Half her speech was taken up with trumpeting flagship projects, and she did not wish to hear about any of the problems that are being experienced in parts of the country that are suffering from deficits.

I issue to the Secretary of State the same invitation that I have already issued to her fellow-Ministers—the Minister of State, the hon. Member for Doncaster, Central (Ms Winterton) and the Under-Secretary, the hon. Member for Birmingham, Hodge Hill (Mr. Byrne)—in debates in Westminster Hall: please come to Oxfordshire to see the other side of the story. The health economy in Oxfordshire is in freefall. The strategic health authority tells us that in the next six months the Oxfordshire health economy has to save £35 million.

Those cuts are the responsibility of Ministers. Under the present Government funding system, Oxfordshire receives only 85 per cent. of the national average for NHS funding. Ministers say that that is because Oxfordshire is wealthy compared with other areas, but it is exactly that comparative wealth that presents the NHS in Oxfordshire with some of its most difficult problems. Housing costs are high, as are nursing costs and agency costs.

What does that mean for our local NHS? The Government's funding plan has already resulted in the proposed closure of the gynaecological ward at Horton hospital in Banbury, and the Oxford Radcliffe Hospitals NHS Trust is considering closing wards at the John Radcliffe hospital and the in-patient pain relief unit at the Churchill hospital. Wards are being closed, beds are being lost, and community hospitals are either not being built or under constant threat of closure.

The Government's amendment has the audacity to claim that they are investing £100 million in a community hospitals programme. Way back in 1997, the right hon. Member for Darlington (Mr. Milburn) stood at the Dispatch Box and promised the people of Bicester a new and enlarged community hospital. We are still waiting for it. In the other place, Lord Warner cannot even tell us whether community hospitals will have beds. If the Government cannot recognise that a community hospital must have beds, God help us all.

The Oxfordshire health economy has to try to save £35 million this year, £25 million of which is to come from the Oxford Radcliffe Hospitals NHS Trust. That can happen only under slash-and-burn cuts. Yet when Ministers are asked about that, they do not take responsibility, but pass it on to the strategic health authority.

Mr. Jeremy Hunt (South-West Surrey) (Con): Is my hon. Friend aware that, under this Government's funding formula weightings, the priority given to social deprivation is three times greater than that given to the proportion of elderly people in an area or to the costs of health care delivery? Does he agree that the people who suffer when that happens are not rich people living in
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rich areas but poor, elderly and vulnerable people who happen to live in areas that have Conservative Members?

Tony Baldry: The weak and the vulnerable will suffer as a consequence of the Government's complacency about what is happening in the NHS. More than that, the Government wash their hands and claim that strategic health authorities make the decisions. They say that SHAs can set out recovery plans, but I wrote some three weeks ago to the chief executive of the Thames Valley health authority to stress that there was no way in which the Oxford Radcliffe Hospitals NHS Trust could save £25 million between now and the end of the financial year. I continue to await a reply. I suspect that the reason is that, yet again, we are undergoing an NHS reorganisation, with all the PCTs in Oxfordshire becoming one.

There is an added twist in Oxfordshire. Clearly, some wise guy in No. 10 thought that it would be fun to consider putting out the management of the Oxfordshire PCT to the private sector. Ministers cannot even work out whether they want to accept the responsibility for that. The Guardian on Saturday reported that Ministers had given an indication that the PCT in Oxfordshire could not go out to private management. Yet the previous day, the Minister of State said in a parliamentary answer:

Why on earth does not the Minister simply say, "PCTs are not going to be allowed to do this"?

UnitedHealth, whose international director used to be an adviser at No. 10, clearly believed that the trust would be allowed to go out to private management. He wrote to me on 11 November, only last week. The letter stated:

It is interesting that the international director is clearly privy to information that is denied the Royal College of Nursing and Unison. When those organisations had the temerity to ask under the Freedom of Information Act 2000—that is their only hope of discovering anything from the Government—they are effectively told to shut up because any discussions between the SHA, UnitedHealth and other providers are subject to commercial confidentiality. That is what will happen with outsourcing resources from the NHS. We will increasingly be told that we cannot ask questions because events are subject to commercial confidentiality. That is exactly what happened in Oxfordshire. It is a distraction from what should be happening to sort out the deficit and the proposed cuts in the Oxford Radcliffe Hospitals NHS Trust.

Ministers should do three things. First, they should intervene in Oxfordshire and elsewhere to ensure that SHAs do not impose unrealistic targets for damaging cuts. Otherwise, slash-and-burn reductions will take place not because they make sense but because they are the easiest way to save money.

Secondly, will Ministers please examine the formulae? My hon. Friend the Member for South-West Surrey (Mr. Hunt) and all Conservative Members would say
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that the Government must consider the formulae and the way in which money is allocated. It cannot be right that Oxfordshire receives only 85 per cent. of the average funding for the rest of the country. If Ministers bothered to come to Oxfordshire, they would realise that areas such as Blackbird Leys in the constituency of the right hon. Member for Oxford, East (Mr. Smith) and wards such as Ruscote and Hardwick are as socially deprived as anywhere in the country. The formula is simply not fair.

Thirdly, Ministers must ensure that we do not continue to go through the ridiculous organisation and reorganisation of the NHS. How much money has been wasted by initially setting up many PCTs and then reorganising them into single PCTs? Moreover, Sir Nigel Crisp said at the start of the recess that PCTs would be allowed to do one thing but the Secretary of State now claims that they will not be allowed to do it. How does anyone in the NHS have any idea about what is supposed to be happening when Ministers keep chopping and changing their minds about what they expect of NHS organisation?

I am sorry that the Secretary of State was so complacent this afternoon. Every time an operation or the NHS fails a person in Oxfordshire, I shall ensure that those people have a summary of this afternoon's debate. Labour Members got up and simply told us how wonderful things were in their part of the country. That demonstrates the two nations that the Government have created.

6.4 pm

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