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16 Nov 2005 : Column 295WH—continued

NHS (Oxfordshire)

4.55 pm

Dr. Evan Harris (Oxford, West and Abingdon) (LD): I am grateful for the opportunity to have this debate. I welcome the Minister and other hon. Members whose timetables may have been slightly affected by the inevitable delay to the start of the debate owing to Divisions in the House. I am happy to see that the hon. Members for Banbury (Tony Baldry) and for Wantage (Mr. Vaizey) are in their places. I know that they hope to catch your eye, Mrs. Dean, as does the right hon. Member for Oxford, East (Mr. Smith). I intend to sit down at seven minutes past 5 o'clock, after 12 minutes, in order to give those hon. Members a chance to have three or four minutes among them and still leave the Minister a chance to reply.

I have given the Minister notice of the broad subjects on which I wish to speak. I have no prepared script, because the problems are obvious and not much preparation is required to address them. Oxfordshire's health economy is faced with huge cuts because of the savings that it has been asked to make. Those savings are to be made this year, not over a number of years through a financial recovery plan, which many of the units of that health economy—especially the hospitals and trusts—are undertaking. Those cuts represent about £30 million. Given the scale of the savings that must be found and the fact that the decision comes after years of cuts because of the need of many trusts to achieve financial balance through financial recovery plans, it will be impossible to meet that target without cuts to front-line patient services.

As other hon. Members representing Oxfordshire constituencies will know, this matter must be seen in the context of the history of repeated annual cuts in social services provision. The pressure on the Oxfordshire social services budget is a result of an unfair formula, the imposition of extra duties on local authorities that have not been properly funded by central Government, and a capping regime that prevents local people from voting to preserve services to the vulnerable, even at the cost of increasing an unfair tax that I would like abolished in favour of a fairer one. The matter must also be seen in the context of cuts in funding for the Supporting People programme owing to an irrational change in the funding formula. That will result in extra pressure on the health service.

The strategic health authority was told in July that it had to break even within a year without brokerage from the wider NHS. It is not possible, fair or reasonable to impose that time scale. There will need to be hundreds of whole-time equivalent job losses even to begin to meet that. The Government must step in and say that that is not what is supposed to happen in the NHS. If there must be a cuts programme, it ought to be phased, so that huge cuts are not made that result in redundancies.

The strategic health authority decided to impose the cuts on a formula that is based mainly on staff numbers. That is unfair on those specialties and services that are human-resource rich compared with the broader operating figure or turnover of a trust. That applies especially, but not exclusively, to mental health and learning disability services. There are questions as to what consultation took place with providers when the
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formula for allocating the cuts was set out and, indeed, on what wider consultation occurred before that decision was taken. It is one thing to have to make cuts, but another to create an arbitrary basis on which hospitals should make them when, by common consent, many of the hospitals instructed to cut budgets are not responsible—having met their financial recovery plans—for the position in which the Oxfordshire health economy finds itself. The Oxfordshire health economy is faced with an impossible situation: the Government have asked it to do things for which there has not been sufficient funding while still meeting its targets.

The Government will say one thing that I would like to address pre-emptively: more money has gone into the health service nationally. That is a fair point to make to those who voted against the tax increases that brought that extra money for the NHS, but the Minister will know that I voted consistently for the tax increases, and I am still concerned. I did not criticise the tax increases to pay for the NHS. Indeed, my party said that we should implement them before the election in 2001 and not just after it. Obviously, people who do not support tax rises to pay for the NHS have to find other ways to provide the money, but the imposition of political targets that Oxfordshire health trusts have been told to meet or they will be named and shamed or zero-starred and the managers sacked means that they have chased the targets at all costs. That may not have been the right thing to do. I think that they should treat patients at all costs, not chase targets. It is not fair that patients should suffer because of the cost of meeting the targets.

The sort of cuts that we are discussing—we do not have time in half an hour to go into them in detail and we know about only a few of them at the moment—apply already to the pain clinic beds. I gave the Minister notice of this list. I am referring to the in-patient beds to treat people suffering from chronic pain. That measure will, as I understand it, save only tens of thousands of pounds—it will not make a big dent—and the service is a specialist one for a very special group of patients who do get relief from it. A community-based service, without in-patient beds, cannot provide that service. When I was a doctor in the Oxford area, I recognised the value that other clinicians placed on it.

We have heard about the proposed closure of the Barnes unit. That is the acute psychiatric service at the John Radcliffe hospital, on which when I was a doctor in Oxford we relied in accident and emergency to deal with people whose physical problems were based on or largely due to acute mental impairment. The fact that a unit was embedded in the hospital took a big load off the emergency department. Losing that service without there being a direct replacement will put more pressure on beds elsewhere in the hospital, and patients will be treated in inappropriate beds, which is extremely unfortunate.

That situation is associated with seven consultant job losses. At a time when the NHS needs to be growing and there is a shortage of psychiatric posts, to say that there will be a loss of seven posts, even though the post holders have been saved through a merger, is a worrying sign of things to come. As I understand it, the scale of the cuts that have to be made across Oxfordshire means hundreds of redundancies. We would not often expect to find ourselves talking about a bigger NHS, as the
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Government tend to, and then about making doctors, who cost a fortune to train, redundant. That is not a good way to seek to recruit people into Oxfordshire.

There are other cuts in mental health and learning disability services. Horton general hospital, in the constituency of the hon. Member for Banbury, is also affected by these provisions. The only response that there seems to have been to the general concern about the extent of the cuts is a bizarre proposal to privatise the management of the primary care trust. Will the Minister tell me about the Department of Health's role in the genesis of the idea that the solution to Oxfordshire's problems was to sack some managers in the new PCT and to outsource the management by tender, probably to a private company, which would then have the commissioning role? As we have discussed in this Chamber before, there are real problems to do with the vested interests that private companies would have in commissioning services from themselves or their commercial rivals. The proposal seems to miss the point in a big way.

There was no consultation. The notice about the proposal said that there had been consultation of key stakeholders. I do not want to give myself or other Oxfordshire Members airs, but clearly the health service in Oxfordshire does not think that Members of Parliament or the PCTs are key stakeholders. I presume that we are talking about the Department of Health. I would be interested to know, if the Department of Health was not behind the proposal—Lord Warner said in the Select Committee on Health recently that the proposal would not be imposed, because it would be a matter for the PCT—whether the Minister is happy that we have a health service that proposes something and then gets it withdrawn. At best, the situation is a mess; at worst, it is a U-turn forced by the opposition to the proposal. If we could have some explanation of what on earth was going on, and reassurance that the proposal is firmly off the table, I would be grateful.

I have a thick file of letters from concerned constituents, and I am sure that that applies to other hon. Members from Oxfordshire. Our constituents are very worried about the impact that the proposal will have on patient care.

I share with the Government the aspiration of a bigger, wider NHS that is properly funded. I do not see why Oxfordshire should be left out of that wish and why Oxfordshire patients, across the board, should be facing such cuts. If there have to be reductions there needs to be time to plan them, but I cannot believe that it is beyond the Government to find a way of ensuring that patients and, indeed, hard-working staff, are not punished for the fact that what the NHS is being asked to do by the imposition of Government targets and, I accept, by patient need is greater than the amount of resources available.

There are particular issues in Oxfordshire such as the need to employ agency staff; it is difficult to recruit and retain staff because of high living costs. There are special factors but they are not adequately recognised in the funding formula, although generally I support a funding formula based on need. Oxfordshire has particular problems and I urge the Government to do something about that, because it is a centrally funded service—
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centrally funded by the Government. There is no option for local people to be able to contribute and they should not therefore be facing such cuts. I urge the Minister in her response to give some comfort to Oxfordshire patients, and to the doctors and nurses.

5.6 pm

Mr. Andrew Smith (Oxford, East) (Lab): I am grateful to the hon. Member for Oxford, West and Abingdon (Dr. Harris) for making available this opportunity, albeit brief, for other hon. Members from Oxfordshire to intervene in the debate. I hope that my hon. Friend the Minister and the Government will take note of the strength of feeling on the issue in Oxfordshire, which is reflected by the fact that hon. Members from all parties are raising concerns on behalf of their constituents.

I want to make four points: first, patient care must be paramount. Secondly, the scale of the deficit in Oxfordshire this year cannot be eliminated in one year without doing unacceptable damage to patient care. It is a tragedy that we are faced with these cuts when £15 million a year extra is being put into the Oxfordshire health economy. That puzzles local people. It is their unanimous view that things cannot be straightened out in one year.

Thirdly, the hon. Member for Oxford, West and Abingdon did not mention that the region had to find £15 million extra this year for Milton Keynes. Milton Keynes has a very good case, but it has limited the ability of the strategic health authority to help with the situation that Oxfordshire faces. If the Government wanted to make some extra help available without setting a precedent nationally, which for various reasons might be difficult for them to accept, I suggest that that is a particular and very important factor that should be considered.

Fourthly, I want to highlight the putting out of primary care commissioning to private tender. An indication of delay in that respect is not good enough; it would be much better for it to be refused now, because when several trusts are grappling with financial imbalances and other difficulties, the last thing they want is that threat and uncertainty hanging over what should be the core responsibility of primary care trusts. It is a bad idea, which it would be better to bury now.

5.9 pm

Tony Baldry (Banbury) (Con): I am grateful to the hon. Member for Oxford, West and Abingdon (Dr. Harris) for allowing me to intervene in the debate. I agree with almost everything that he and the right hon. Member for Oxford, East (Mr. Smith) said.

I shall say a quick word about deficits. Originally it was said that there would be a deficit in the Thames Valley strategic health authority of £35 million and in Oxfordshire of £25 million, mostly in the Oxford Radcliffe Hospitals NHS trust. I understand that at a recent meeting of the strategic health authority it was said that that figure may have come down to £15 million, but the figures £23 million and £18 million have also been bandied around. My first request, therefore, is please can Richmond House—the Department of Health—and the strategic health authority agree on the size of the deficit? That surely must be possible.
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Secondly, the Oxford Radcliffe Hospitals NHS trust did not start this year with a deficit. It had a three-year recovery programme, so all the deficit is in this year because of what the Oxford Radcliffe hospitals—the John Radcliffe and the Horton—have been doing to meet the Government's waiting list targets. It has not been financial recklessness. My next request is please can we have a clear indication from Ministers whether the hospitals can have more than one year to pay off the deficit, as the right hon. Member for Oxford, East said, or will it all have to be done by the end of this financial year?

When I wrote to the Secretary of State about this matter, I was told that it is the responsibility of the strategic health authority. I have written to the chief executive of the SHA, but I have yet to receive a response. However, I understand that Sir Nigel Crisp has signalled that in-year deficits must be met by the end of this year. The Oxford Radcliffe Hospitals NHS trust would have to find about £18 million or £15 million in this financial year. That cannot be done without crazy slash-and-burn policies. That would have a dramatic impact on both the John Radcliffe hospital and the Horton general hospital in my constituency.

I have two simple requests for the Minister. Can we agree on the deficit and can a clear signal be given to the Thames Valley strategic health authority that it is not feasible for the Oxford Radcliffe Hospitals NHS trust to save £15 million or £18 million in a single year, especially as that would come after a three-year recovery programme? There has to be a sensible proposal for how that money can be recovered over a number of years. Unless that is made clear now, we will have a disaster in the last quarter of this year. In order to make such savings, the chief executive and the board of the Oxford Radcliffe Hospitals NHS trust will have to make cuts, not because those cuts are rational but just because they are the quickest way of saving money. That will damage patient care.

5.11 pm

Mr. Edward Vaizey (Wantage) (Con): When I asked the Prime Minister about this issue this afternoon, I quoted from an excellent and closely argued editorial in The Oxford Times, which concluded that Ministers must intervene, and set out three reasons why they should do so. The right hon. Member for Oxford, East (Mr. Smith) has four reasons why Ministers should intervene, and I have five. The Prime Minister gave me the brush-off—to use a colloquialism—but I hope that the Minister will not do so.

There are five reasons why there must be intervention. First, historically, Oxfordshire has been underfunded; we receive 85 per cent. of the national average. Secondly, as the right hon. Gentleman pointed out, £15 million has gone to Milton Keynes. That is a demonstrable case of underfunding; the money has gone there because the population of Milton Keynes has increased rapidly over the past four years, but the funding is still based on the 2001 census. Thirdly, as my hon. Friend the Member for Banbury (Tony Baldry) pointed out, the John Radcliffe hospital has done such a good job in meeting its targets and cutting waiting lists that that has put a strain on finances.

My fourth reason is a more general point. Health inflation is running at about 6 per cent. The Prime Minister said that funding had increased by 6.5 per cent.
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Therefore, in effect, that increase is almost negligible. Finally, we have had a bureaucratic organisation imposed on us—the five primary care trusts that were imposed from the centre. That is now being scrapped, as my hon. Friend the Member for Banbury and other Members mentioned, and one PCT will be formed instead. That has imposed costs on us that are not our responsibility.

In conclusion, I simply say that I hope that the Minister will intervene.

5.13 pm

The Minister of State, Department of Health (Ms Rosie Winterton) : I congratulate the hon. Member for Oxford, West and Abingdon (Dr. Harris) on securing the debate. As he said, there is cross-party concern about the matter under discussion. I understand the points that have been made—

Sitting suspended for a Division in the House.

5.20 pm

On resuming—

Ms Winterton : Thank you for your indulgence, Mrs. Dean, in allowing us to carry on.

The hon. Member for Oxford, West and Abingdon made the point that extra money has gone into the NHS. He also pointed out—I know that my right hon. Friend the Member for Oxford, East (Mr. Smith) would agree—that the Conservative party voted against the increases that have enabled us to put it there.

As my right hon. Friend said, our aim is to improve patient care, and we have to make sure that patient care is paramount. However, it is also important to realise that good patient care and good financial management go hand in hand. As my right hon. Friend said, an extra £50 million has gone into the Oxfordshire health economy this year. The primary care trusts in the Thames valley have received an overall increase of £167   million this financial year and will receive £427 million next financial year.

We are devoting big increases in spending to the NHS. Despite that, the Oxfordshire health economy has built up a financial deficit. We need to make sure that that is sorted out; otherwise, one area in the strategic health authority will effectively carry on subsidising another, year on year—that will mean taking money from one area and putting it into another. It is therefore important that we are rigorous and firm in saying that the financial deficits need to be sorted out.

Both my right hon. Friend and the hon. Member for Wantage (Mr. Vaizey) asked about Milton Keynes. Milton Keynes is in a situation similar to that of Oxfordshire, and the SHA is providing financial assistance there. However, the SHA has given £10 million in financial assistance to Oxfordshire and an additional £1.5 million to support the Oxfordshire mental health trust, and that has been achieved by using surpluses generated by other organisations within Thames Valley. As I say, that situation cannot continue.

All hon. Members who spoke, particularly the hon. Member for Banbury (Tony Baldry), asked about the balancing of the books for this year. The situation in Oxfordshire is fluid and can change month by month, so
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it is not possible at this stage to predict what any deficit may be. We never do that until we have audited accounts. However, SHAs are being expected to achieve overall balance this year. That means that they may adopt methods similar to those used previously: they may take surpluses from some areas and use them to subsidise areas with particular problems.

However, I reiterate that in such situations we expect the health authorities to achieve that overall balance and ensure what is best in the longer term for local people, patients and staff working in the area. I pay tribute to the staff working in Oxfordshire, who, I am sure, are doing everything they can to deliver good quality services to patients. Nevertheless, it is important for all concerned that we achieve that financial balance.

As right hon. and hon. Members know, the revenue allocations are made direct to primary care trusts, based on the relative needs of their population. A formula is used to determine each PCT's target share of available resources. There are always arguments about the relative merits of the formula, but we work extremely hard to ensure that it is fair.

I want to deal with some of the concerns about the proposed closure of services. NHS organisations have a duty to involve and consult patients, the public and their representatives in planning and development of and changes to the operation of services, and the overview and scrutiny committees also play a part when such changes are considered. Therefore, I would expect there to be good consultation.

I understand that the proposals for the closure of the acute psychiatric in-patient service at Moorview and the Barnes unit will be consulted on shortly and that the Oxfordshire Mental Healthcare NHS trust is seeking to redeploy staff in the Oxfordshire and Buckinghamshire mental health services. I hope that that gives right hon. and hon. Members some reassurance. In regard to the closure of services at Henley, I also understand that Henley was a partnership between the council and the Oxfordshire learning disability trust. The council stopped funding the Chiltern Centre at Henley and, for a while, the future of the service was in doubt. However, the charitable Chiltern Centre for Disabled Children now runs the centre.

I think that all hon. Members referred to the possible out-sourcing of the management of Oxfordshire primary care trust. I shall use this opportunity to reiterate what we have already made clear. We want SHAs and PCTs to put forward proposals through "Commissioning a patient-led NHS", when it comes to the reconfiguration of PCTs. We want proper
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consultation on the proposals, and a model for organisational boundaries then to be determined. However, it will then be down to each PCT to propose how it will discharge its statutory functions. Only after some of the organisational changes are made will the PCTs consider how to make the changes, if they wish to do so, in running services.

Dr. Harris : I welcome that, which I recognise as the position put by Lord Warner in the Health Committee. I have two questions for the Minister. First, who is to blame for the fact that people were led to believe—it is clear in the SHA paper—that all this would happen very soon, long before the merger was complete and the PCT would decide itself? Secondly, did Ministers in the Department know at the time about the proposal, which has now been pulled, and did they say that it was unacceptable to make it so prematurely?

Ms Winterton : The Secretary of State has made it clear that the letter sent out on 28 July was not meant to indicate that the services provided by PCTs should suddenly be removed, but that we wanted proposals for organisational changes. If PCTs then wished to divest themselves of the provision of services, as opposed to the commissioning of services, they would do so only if they had fully consulted local people and felt that that was the right way forward for their local area. PCTs do not, therefore, have to divest themselves of services. I hope that that has now been made clear to all SHAs and will be reflected in the proposals that they put forward.

I shall now turn to the closure of the in-patient pain service beds at the Churchill hospital, which are part of a strategic review to look at ways of linking chronic and acute pain services and to ensure that the trust can continue to deliver high quality and integrated care, to which my right hon. Friend the Member for Oxford, East referred. The trust is considering how to provide access to in-patient facilities in an alternative location within the hospital. It is following due process in line with the trust's policy on organisational change and redeployment.

I understand that the closure of an orthopaedic ward at the Nuffield orthopaedic centre is part of plans to modernise service delivery. The trust has reviewed its operation to ensure that service quality is maintained following the changes. Again, the overview and scrutiny committee has been consulted and has determined that the proposal does not constitute a substantial change to services.

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