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6.46 pm

Mr. Phil Willis (Harrogate and Knaresborough) (LD): I am not a Health Committee member, but I was particularly interested in the report and I congratulate the right hon. Member for Rother Valley (Mr. Barron) not only on introducing an exceptionally interesting report, but on engaging a wide range of opinions on it and the Government response. That is highly commendable.

I am glad that the hon. Member for West Chelmsford (Mr. Burns) has returned to his seat. It was interesting to listen to a Conservative party member talking about his opposition to plurality of providers within the NHS, because I thought that that was standard policy. To have treatment centres offering different approaches seems to me to be absolutely right.

Mr. Burns: Will the hon. Gentleman give way?

Mr. Willis: Not at present. I also listened to the remarks of the hon. Member for Castle Point (Bob Spink).

Mr. Burns: Will the hon. Gentleman give way?

Mr. Willis: No, I will not give way. I am just making a comment on the— [Interruption.]

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Mr. Deputy Speaker (Sir Michael Lord): Order. This is a serious matter. Perhaps we can conduct our affairs with a little more decorum.

Mr. Willis: Thank you, Mr. Deputy Speaker. It is also interesting that the hon. Member for Castle Point, who sits on my Committee—the Science and Technology Committee—recognised that when contracts are offered to the private sector it is not surprising if private companies cherry-pick business. That is why our hospital trusts are left with the more expensive and involved cases. I say that in order to make an observation on the remarks of the hon. Members for West Chelmsford and for Castle Point.

Mr. Burns: Will the hon. Gentleman give way?

Mr. Willis: I shall do so now.

Mr. Burns: I am extremely grateful to the hon. Gentleman for giving way. I am aware that the Liberal Democrats are skilled at misrepresenting people, but may I explain to the hon. Gentleman—who obviously was not intelligent enough to understand what I said earlier—that I was not complaining about the plurality of provision but suggesting to the Minister that having an independent treatment centre so near to a hospital that was doing well might have an adverse affect on it? I was not saying that there should be no plurality of provision in the health service.

Mr. Willis: I am delighted that I have been able to give the hon. Gentleman an opportunity to clarify that. We now know that we can have plurality, provided that providers are not too near to other providers. That is a clear position for the Conservative party to adopt.

Let me tell the Minister and the right hon. Member for Rother Valley, who is no longer in his place, that I agree—indeed, my hon. Friend the Member for Romsey (Sandra Gidley) made it clear that the Liberal Democrats agree on this as a party—with the general principles that the Government are trying to follow with their health service reforms, in that what matters is the treatment that individual patients receive. We are all trying to reach the same point. When the NHS was founded, its purpose was to treat individuals according to their clinical needs. We are strongly in favour of that. There might be different journeys on the way to that point, but I would like to think that the whole House would coalesce around that specific objective.

The real issue is that we cannot allow primary care trusts, individual hospital trusts or any other trusts that provide care to be told that they must control their budgets and manage within them, but then to be given directions from the centre, over which they have no control, that impact on their budget decisions. Government targets and new initiatives have already been mentioned in that regard. Local PCTs have absolutely no control over initiatives that come from the Department, but they have to treat them as priorities. In many cases, that will distort their budgets.

PCTs have also changed. In the almost 10 years that I have been an MP, there have been four changes to the organisation of PCTs and their predecessor bodies. That does not give the necessary firm foundation on which to take long-term decisions about health care
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needs within a particular area. All those decisions have had an impact on the budgets that were to be given to front-line providers, yet they had no control over those decisions.

The latest decision to affect North Yorkshire and York is the huge reorganisation of PCTs that has left our area with the largest deficits of any PCT in the country. In Harrogate and Knaresborough, the PCT and the hospital were in balance, but they had a 2.5 per cent. budget cut, through top-slicing, and we have had to pick up the huge problems from the Selby and York—the hon. Member for City of York (Hugh Bayley), who is in the Chamber, will know about that—and Scarborough PCTs. It is wholly wrong to tell my local hospital trust that it has to pay the penalty for mismanagement elsewhere or for centrally driven targets and initiatives. The Government cannot have it both ways—but that is the effect of their argument.

Like most areas, ours has received significant rises in health budgets. Conservative Members have admitted that getting to the European average was a significant Government initiative. I congratulate the Minister and his colleagues on that. This year, North Yorkshire and York has received a 9.5 per cent. increase in budget, which is £69 million extra, but we have had to address a £43 million deficit. Last week the PCT told us that it had made significant inroads into that deficit, which is now only £35 million. However, those reductions include a reduction in the money available for redundancies, which is purely a paper transaction, and in other transactions and capital costs. The reality is that constituents across my patch face significant cuts to services.

The trust at Harrogate district hospital is not only a three-star trust, but the highest-performing trust in the country. That is down to the work of its brilliant chief executive and good clinical staff, but it now has to cut back on treatments. What is the effect of that? Something that has not been mentioned much today is the effect that such changes have on people. The hon. Member for West Chelmsford—I hope that he does not shout at me again—rightly mentioned choose and book, and the complications that came with it, particularly with the intervention of an assessment panel; I do not know what the correct terminology is, but I shall call it an assessment panel. I hope that the Minister will sort out that interface between GPs, consultants and the PCT. I believe that he is committed to resolving these problems,

The problem is not just about money; it is the imposition of organisation from the top. I shall give hon. Members a few examples, the first of which is an excerpt from a GP’s submission to what is known in our area as the exceptions panel—an interesting name—about a lady in my constituency who has significant bilateral knee pain. He wrote:

He goes on to say that after discussing the matter with the patient, he did as he was asked, only to get a letter back refusing the MRI request because he now,
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apparently, needs prior approval from the PCT’s referral panel. That is absolute nonsense. That GP has made a clear clinical assessment—the very purpose of the NHS—and someone else is second-guessing that assessment.

I particularly want to discuss the case of a three-year-old boy in my constituency called Elliot Isaacs. I suspect that many right hon. and hon. Members will have similar cases in their constituencies. Elliot has major hearing problems. After a long fight, he was fitted with grommets in both ears last summer. That made a huge difference to him, and he suddenly began to communicate more effectively. His speech improved, and obviously his hearing had improved significantly. He was making substantial progress—until the grommets came out in October because of a related illness. That is quite common; it certainly is not unusual. He is now being refused—not by his consultant or GP, but by the faceless interface between the GP and consultants—the opportunity to have grommets refitted and to be able to hear again and develop.

All hon. Members who have young children know that those early years are the most critical age for the development of language and everything else that goes with it, but that decision was made by that impersonal interface. The irony of it is that Harrogate hospital, which carried out the first operation, performs grommet operations on a daily basis for patients from Leeds, because the PCT there has the money to send its patients to Harrogate to have those operations. If that is a local care system responding to the needs of local people, I am a Conservative—or a Dutchman, or whatever.

That is the principal issue to which I would like the Minister to respond. His response to the Select Committee report does not address some of its core recommendations. There has to be a two-way street between organisation and local autonomy. Yes, financial prudence and good financial management are necessary, but so is independent decision making, and local trusts must have the right to make those decisions.

6.59 pm

Mr. Bernard Jenkin (North Essex) (Con): I follow the hon. Member for Harrogate and Knaresborough (Mr. Willis), and I share some of his dilemmas, in that I come from an area in which the health authority was running things in line with the financial restraints imposed on it and is being punished for the sins of others, as we try to bail them out. I commend the Chairman and Members of the Select Committee that produced the report. I agree with the hon. Member for Wyre Forest (Dr. Taylor): this is a seriously hard-hitting report. It explains why, fundamentally, all the extra money that has gone into the health service has had so little beneficial effect. The money has cushioned the health service against the need to reform, when the reforms should have been prepared in advance of the extra money going in. Unfortunately, we have seen a huge increase in budgets and little reform.

The report does not pull its punches. I invite hon. Members to look at paragraph 63 onwards. The headings tell the story: “Poor local management”, “Poor accounting and financial management”, “Lack of leadership and
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loss of management control”, “Poor central management by the Department of Health”, and “Badly-costed work contracts”. Those are just the headings for the litany of management and financial failure in the health service, which has affected it at every single level. The East of England strategic health authority, my local strategic health authority, is cited in paragraph 24 as one of

Colchester and Tendring primary care trusts, which are now called the North East Essex primary care trust, are paying the price for the financial failures of other areas. We have to recover a deficit of £6 million in the current financial year, because the East of England strategic health authority appears to have removed £7.8 million of our spending capacity in the present financial year. Next year it will take another £5 million of our spending capacity. That is because of deficits in Suffolk of £30 million, in Cambridgeshire of £52 million, and in Hertfordshire of, I was told, £42 million, although I now hear that it is £55 million.

The impact of those deficits on the health care in my constituency is considerable. I have hospital consultants telling their patients and me that they have been instructed by their management to lengthen the waiting times to the maximum period—not to shorten them or reduce suffering—in order to delay expenditure until the following financial year. I have a LIFT, or local improvement finance trust, programme—a GP surgery improvement programme—that is being thrown into suspense. A number of substandard surgeries in my constituency, in West Mersea and other areas such as Wivenhoe, have been told that they have to wait even though their expectation was, years ago, that they were going to be given new modern surgeries.

I cannot let the moment pass without adding my voice to the concerns about some of the private finance initiatives that we have seen in the area. They have turned out significantly more expensive and significantly wrongly specified. Whether that is the fault of the contractors or the health authorities is a matter of dispute. They have locked in a degree of expenditure that is therefore not available for spending on other things.

The solutions are obvious: much stronger financial management, much less central Government interference, and fewer initiatives and short-term targets from the centre. I commend the Government’s endorsement of reserves, which is set out in paragraph 80 of their response. They say that they wish to

Particularly where there is to be increased volatility in trusts as a result of payment by results, a more businesslike approach to cash management and cash reserves will be a necessity. The funding of the NHS will have to reflect that.

I conclude my brief remarks by simply saying that the past 10 years of management of the health service reflect not so much the Prime Minister’s intentions for the direction of the health service as the Chancellor of the Exchequer’s control of the health service. The present mess is the Chancellor of the Exchequer’s mess. Like us all, he will have to confront the truth of why, as the country nears a European average spend on health, health outcomes in this country are still so inferior to those in so many of our European partners.

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That has much to do with the whole concept of the NHS as presently conceived, with too much central direction and control and not nearly enough local management and control. Unless we all embrace that, more money will be wasted, more patients left untreated and more misery inflicted on our constituents. I know who my voters will blame. After all the promises that the Government made about improving and saving the NHS, my voters, and I guess voters all over the country, are more bitterly disappointed and disillusioned with all politicians—as a result of the Government’s failure on the NHS—than I have ever known them.

7.5 pm

Mr. Andrew Lansley (South Cambridgeshire) (Con): I am glad to follow my hon. Friend the Member for North Essex (Mr. Jenkin), who was admirably brief but very much to the point. He, like others in the debate, was speaking from experience of the impact of deficits on his constituents. As he said, not only will voters hold the Labour party responsible—comparing the situation with all the promises that they were given 10 years ago—but it is the Chancellor of the Exchequer’s responsibility. People say, “How can it be? He’s not in charge of the Department of Health”, but when one looks at the report and sees the way in which accounting changes and things such as the abolition of capital-to-revenue transfer, the abolition of brokerage, and resource accounting and budgeting are affecting NHS trusts, one realises that such things are the responsibility of not only the Government, but the Treasury. The Chancellor of the Exchequer will not be able to escape responsibility.

A number of Members were generous to the Minister who will respond to the debate, but when the time comes he is not going to escape responsibility either. If one wants to know how complacent the Government were, one has only to go back to March 2005, in the run-up to the general election, when we raised the difficulties with the emerging deficits in the 2004-05 financial year. What was the response of the Minister’s predecessor, the right hon. Member for Barrow and Furness (Mr. Hutton)? It was, “Oh, they always say that there are going to be deficits at this time of the year and it always gets sorted out.” The whole point is—the Select Committee’s report is perfectly correct in this respect—that it was in 2004-05 that capital-to-revenue transfers were eliminated. So, of course, the situation was not sorted out in the way that it always had been in previous years.

Before I turn to the deficits, I want to say a word of commendation to colleagues who have spoken. The right hon. Member for Rother Valley (Mr. Barron) did justice to what is a good, robust report. As my hon. Friend the Member for Hemel Hempstead (Mike Penning) rightly said, it was agreed on a consensus basis, as I think that all Health Committee reports have been. Rightly, the report made some trenchant criticisms and I hope that, when the Minister replies, he will accept them. When senior officials in the Department of Health were asked last year whether the Department was good at managing change, 81 per cent. disagreed or disagreed strongly with that proposition. The Department does not believe that it is managing change well; it knows that it is getting these
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things wrong. We know from the Healthcare Commission that primary care trusts that have been plunging into deficit have poor financial management. None was given an excellent rating and 124 were given a weak rating. Weak means that they need immediate action to remedy their financial failings.

Some important points were made during the debate. My hon. Friend the Member for West Chelmsford (Mr. Burns) made an important point about the nature of choose and book, and referral management. There are a number of Members from north Yorkshire present. I was talking to a GP in north Yorkshire who put things extremely well. He said, “What is the point of having a system that allows us to exercise choice if I sit down with a patient and look at the waiting times and he can choose to be seen at Leeds, which is quicker than being seen in York, and we put that into the system and the information goes off to a referral management centre, only for him to be told that he can be seen at Leeds, but he’s going to have to wait 20 weeks anyway?” As my hon. Friend the Member for North Essex said, the week before last the BBC found that 43 per cent. of primary care trusts throughout the country are imposing minimum, not maximum, waiting times, and saying that patients cannot be seen before a certain date.

A question that I keep asking the Minister and to which I never receive a satisfactory reply is why, in the latter part of this financial year, have not the Government allowed primary care trusts and local hospital trusts to arrive at marginal pricing deals, whereby they say, “We have capacity, you have limited resources; we can estimate our marginal cost of sustaining that capacity and treating patients, so let us treat more patients for a given budget.” The tariff and the Government’s determination that it should only ever be a uniform price are damaging patients’ prospects.

The hon. Member for Staffordshire, Moorlands (Charlotte Atkins) was the only other Labour Back Bencher who supported the Select Committee, which surprised me. There were many contributions from the Opposition Benches, but it is all too predictable that Labour Members will not come here to defend their record, even when a cross-party Select Committee is exposing the problems.

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