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15 Jan 2008 : Column 235WH—continued
Now, it could be the case that that string of NHS managers were all equally incapable of handling the crisis at the trust, and it could be that the turnaround teams brought in by the then Secretary of State, the
right hon. Member for Leicester, West (Ms Hewitt) were stymied by the incompetence or obstruction of the management, but that stretches coincidence too far. Ministerial decisions had caused the crisis, and no manager could balance the performance targets and the budget in those circumstances.
The good news is that the trust is forecast to break even this year. However, there remains a debt of £54.9 million to the Department. I would like the Minister to address that figure when she responds. The interest on this loan is currently costing the trust £2.7 million. The trust’s financial managers are also in the position of having to find £2 million-plus every year from their budget to repay the loan, and they have to do that in the knowledge that for every year the loan remains, more money that should be invested in patient care is being used to pay interest.
In seeking this debate, my hope is to ask the Minister to look into the very particular history of the debt incurred by the Surrey and Sussex Healthcare NHS Trust. If she does so, she will see that costly reorganisations were punctuated with costly delays—for reasons far outside the control of the trust. Ministers could have enabled the reorganisation to begin in 1999, but the Department took a year to consider plans that had taken a year to create. Ministers suspended the reorganisation in progress in 2001. Previous ministerial decisions have contributed directly to the highest deficit in the country. Today’s management should satisfy the Minister that the trust is becoming financially sound. The current management are bringing the trust on to a solid financial footing. The financial improvement, however, has come at a price. My constituents and I and my hon. Friends the Members for East Surrey and for Mole Valley are beginning to see a rising tide of concern about the clinical care and performance of the hospital. My impression is that the obsessive concentration on achieving financial goals has taken the current management’s eye off the performance goals in a way that runs counter to the position that was developed under Ken Cunningham. That is the area in which I would like the Minister to show real faith in the trust, and to put the needs of patients first.
Without this loan, the trust would be in a position to address the problems in its accident and emergency department that have played such a part in the weak scores ascribed to it by the Healthcare Commission. If the Department writes off this debt, the Trust can at last move on after nearly a decade of instability and uncertainty. The alternative is that my constituents, those of my hon. Friends, and those of the hon. Member for Crawley will continue to be served by a hospital that is paying debts imposed on it by political decisions. I have seen the very debilitating effects of a management being constrained from doing the right thing. The consequences today are that the patients served by this hospital could be enjoying nearly £5 million a year invested in improving services and the prospect of a management delivering further improvements under foundation status. That is quite apart from the £117 million of capital investment that was identified as required by Peter Bagnall in 2002.
Timing is everything. This year the health service is in surplus. I urge the Minister to use this opportunity to examine the case and to write off the deficit of this trust, which was imposed in unique and not very creditable circumstances.
12.48 pm
The Minister of State, Department of Health (Dawn Primarolo): I congratulate the hon. Member for Reigate (Mr. Blunt) on securing this debate about the financial position of East Surrey hospital, which is part of the Surrey and Sussex Healthcare NHS Trust. It is a matter of great concern to him and his constituents. I certainly appreciate the comments that he has made today about the quality and commitment of the hospital staff.
One of the key responsibilities of an NHS trust is to live within its resources. However, the Surrey and Sussex trust is currently in a deficit position of £2.6 million for the 2007-08 financial year. I appreciate that the trust has more work to do but, like the hon. Gentleman, I commend the efforts of the staff and management in reducing the forecast deficit from almost £30 million in 2004-05.
I understand the points that the hon. Gentleman was trying to make, but the fact of the matter is that the deficit is a result of the trust spending more than its income, which was in part due to not meeting its savings plan. I understand from the South East Coast strategic health authority that a full restructuring—the hon. Gentleman touched on that—of the executive team, clinical directorates, governance, finance, work force and estates and facilities has been completed at the trust to strengthen accountability and to focus on delivery and performance.
I want to deal with the hon. Gentleman’s concern about the trust’s loan. In March 2006 the trust received a working capital loan of £56 million, repayable over 25 years. The loan was provided to cover the cash consequences of historical overspending that had previously been managed through an informal brokerage system, which was not transparent and often was not fair to the rest of the health service. The hon. Gentleman puts a straight question to me: why do I not simply write off the debt? I cannot write off the debt, for the following reasons.
NHS organisations must live within their means. The deficits of NHS trusts cannot simply be erased, not least because overspends in one part of the system must be covered by underspends in another. We are transferring money from elsewhere. The money loaned to the Surrey and Sussex trust by the Department has been provided by other parts of the NHS that have underspent. The trust needs to repay its loan so that the cash can be returned. Simply to write off the loan would be fundamentally unfair to organisations that have a firm grip on their finances.
Mr. Blunt: Will the right hon. Lady give way?
Dawn Primarolo: I would like to go a little further, but I will give way before I conclude. I want to reassure the hon. Gentleman that mechanisms in place with regard to the loan will address his specific fear that unreasonable financial pressure will somehow be exerted in respect of the loan and, therefore, that patient care will suffer. That goes to the heart of the matter.
A number of trusts, including Surrey and Sussex, are in challenging positions because of historical debts, but our first reaction cannot be simply to write off those debts. None the less, given the size of the loan and the length of the repayment period, it was agreed that the trust be classified as one of the financially challenged trusts that would go into a new formal review process. I want to talk about that to reassure the hon. Gentleman.
As a result of introducing the new loans scheme in 2006-07, there were 17 NHS trusts in which the financial challenges were such that either the Department could not give a loan because the trust could not afford to meet the repayments, or a loan was agreed but the amount could be repaid only over an extended time scale. One element of the review of each of the financially challenged trusts—the Surrey and Sussex trust is in that category—is a close examination of the ongoing impact of debt and the associated costs of repayment, which is exactly the point the hon. Gentleman talks about. That will ensure that a sustainable outcome is delivered that both provides financial stability and maintains quality of care. For the Surrey and Sussex trust, that means that if the repayment of the loan leads to problems, they will be identified and addressed through the performance management process in agreement with the strategic health authority.
The reviews of all financially challenged trusts have been completed, and strategic health authorities have made proposals in respect of them. Those proposals are being discussed with the Department, and acceptable solutions will be released as they are agreed. I shall ensure that the hon. Gentleman and his colleagues are kept fully informed of those developments.
The hon. Gentleman will acknowledge that, since 1997, funding for the national health service has tripled and that as we move towards 2010-11, when we will have gone from expenditure of £33 billion in 1996-97 to £110 billion, it has also been necessary to ensure that we have a financial management system that is transparent and fair to all—to ensure that all health service trusts are treated in the same way. He referred to the deficits of the health service as a whole. He will know that we ended 2005-06 with a £547 million deficit and we needed to take rigorous action, but he will also know that the audited results for 2006-07 show that the NHS as a whole reported a net surplus of £515 million, and at the end of the second quarter of 2007-08 the surplus has risen. That represents 2.3 per cent. of total NHS revenue expenditure. The hon. Gentleman asked why we do not use that money, but I am sure he recognises that, in fairness to the whole health service, particularly those parts that are underspending—
Mr. Blunt: Will the right hon. Lady give way on that point?
Dawn Primarolo: I will give way in a moment. Locally generated surpluses are giving NHS organisations in all areas much more flexibility to respond to patient need, and giving clinicians and managers the necessary headroom to plan better for new services and to manage risks. I absolutely accept that the hon. Gentleman has identified one of them.
Mr. Blunt: I am grateful to the right hon. Lady for giving way. She has yet to acknowledge that ministerial decisions played any role at all in the deficits of the trust. That is what happened. We all know why. It is because of ministerial intervention that I now seek her ministerial intervention, in the circumstances of the surplus that she has just described, to help the trust.
Dawn Primarolo:
I simply do not accept the hon. Gentleman’s proposition. He should look at the reconfigurations that have taken place in different parts of the country. He and his hon. Friends happen to have
supported this one, but others have been held up where he and his hon. Friends do not support them. Each one is recommended on the basis of clinical need.
I have a tiny bit of familiarity with the areas that the hon. Gentleman talked about, because I lived in Crawley as a youngster. My mother was treated at Redhill. I know the Crawley site reasonably well and I certainly know and have some understanding of the demands of the widespread community that he identified. However, to say that the matter we are discussing is the result only of the Secretary of State or Ministers cutting across local accountability and clinical recommendations is simply incorrect. Any trust, including Surrey and Sussex, that has received a loan has a duty to repay it—a duty to the rest of the health service that is in balance. None the less, because of the status of the 17 trusts designated as financially challenged, there is a positive process in place to watch over the developments.
The Surrey and Sussex trust is one of four organisations nationally that received a Healthcare Commission rating of weak in both use of resources and quality of services for 2006-07 and 2005-06. As a result, David Nicholson, the chief executive of the NHS, is meeting the organisations and their strategic health authorities to consider and agree a recovery action plan, and consider whether further support is required. The Healthcare Commission will inspect the organisations, assess the problems and make recommendations for action, reporting back nationally on any common traits in weak organisations. That puts in place a thorough review to address the hon. Gentleman’s fears and the risks he has identified. His contribution to today’s debate will form part of that consideration and I am grateful to have been able to respond.
Mr. Mike Hancock (in the Chair): Very well timed, Minister. I thank you, the hon. Member for Reigate (Mr. Blunt) and other Members who contributed. We now move to the next debate.
Gatwick Airport
1 pm
Laura Moffatt (Crawley) (Lab): I am absolutely delighted that I secured this debate. I believe that it is hugely important not only to Crawley residents, but also to people throughout the UK.
Aviation is one of the most successful industries in the UK. It has provided employment for a great many people and the UK is seen around the world as an industry leader. The Minister will know that Gatwick airport is wholly within my constituency. It is the busiest single-runway airport, and the seventh largest, in the world. It is a successful, award-winning airport. Some 90 airlines fly from Gatwick, taking passengers to some 230 destinations worldwide. More than 35 million people pass through the airport each year, which must make my constituency one of the most visited in the UK. My husband, Colin, has been employed at Gatwick all his working life, which is common for people in Crawley—generations of Crawley people have been committed to the airline industry. The airport provides direct employment for 25,000, and a further 12,000 to 13,000 people whose jobs are directly related to Gatwick work off-site.
The staff are fantastic. I visit the airport frequently, as a passenger to use the excellent transport interchange, and as a Member of Parliament to look at all aspects of its work. I have seen first hand how hard Gatwick staff work to ensure that the passenger experience is good. That goes for the whole organisation, from senior management through to cleaners. I would probably put the cleaners at the top at the moment—they are really good.
I believe that the staff have succeeded. They rose to the challenge posed by the need for additional security measures. The airport has employed more than 450 new airport security officers to ensure that the passenger experience remains one of the best in the country. Carriers worked with the Civil Aviation Authority to reduce the resulting congestion by bringing innovative ideas to improve check-in times. Virgin Atlantic introduced a great idea whereby passengers were allowed to check in from midday to nine o’clock on the day prior to their flight. That reduced a lot of stress and congestion at the airport. There are many initiatives—too many to mention—but people are really thinking about how to make Gatwick a better place. The immigration service continues to pose difficult challenges to those who seek to ensure that people get through Gatwick as quickly as possible, but there are good working relationships and people come up with great ideas to reduce queues.
The airport is frequently recognised for the contribution it makes. Last year, it won the Travel Bulletin award for best UK airport for the fourth consecutive year; it was voted the UK’s favourite leisure airport by British Travel Awards; and favourite British airport by readers of The Daily Telegraph and The Sunday Telegraph—I do not know what to say about the latter, frankly. More than 35 million people travel through Gatwick each year, so those awards are something to be proud of.
People make airports, and I wish to take this opportunity to congratulate and thank the people who work to make Gatwick such a decent place. There is an ongoing issue regarding the BAA pension. Staff and the trade union movement were concerned that those joining the
company may not enjoy the same advantages as those who already work there, and they were prepared to take action. I see the fact that people are prepared to keep the issue at the forefront as positive. Also, the airport works with the trade unions on the 23 kg limit for single bags. That excellent initiative is supported not only by the trade unions, which know about the injuries sustained by people who move baggage, but by employers, who want far fewer people on sick leave because of injury and all that that involves.
There are lots of new issues at Gatwick. British Airways remains hugely important, and I hope that that remains the case. Virgin Atlantic has expanded its Gatwick operation by 20 per cent. in the past five years, and many other excellent carriers are expanding their operations. I hope that I have demonstrated that Gatwick airport is extremely important. It provides major employment opportunities and contributes hugely to the economic prosperity of my area. Gatwick not only attracts companies with interests in airport industries, but companies that need to locate near to a transport hub. That is what Gatwick brings to the business community, and the community puts Gatwick at its heart.
It is no wonder that so many of my constituents support Gatwick airport or that people in Crawley are rightly proud of it. It is acknowledged nationally that it provides one of the best travel experiences. Local people know only too well the difference that having the UK’s second largest airport locally makes to our lives. They also know that any decline of the airport would have a huge impact on them, which is why I introduced this debate.
In 2003, the Government White Paper recognised the importance of the aviation industry in the UK and, as such, was widely welcomed by the industry and beyond. Naturally, views about the environmental implications of the White Paper were strongly expressed, but they were examined closely and the paper included measures that could improve the environmental impact of aviation. A wide range of measures could be taken. In particular, the European emissions trading scheme will, I believe, create a much better platform for reducing carbon emissions from airports and the impact of aviation on our planet. New technology has a huge amount to offer. Some of the airlines at Gatwick have ordered new airliners such as the Dreamliner, which is much more efficient and easier on the planet.
With BAA, Crawley borough council has created groundbreaking environmental agreements to improve the environmental performance of the airport. That has never happened before, but it has been a huge success and it is about to be renewed. The airlines have done more. They now work to fly their aircraft differently to reduce noise and engine emissions pollution, so they have been actively engaged.
I mentioned that Gatwick is a fantastic interchange for transport of all sorts. The upgrading of the train station will benefit people who work in London and those who will arrive for the much-awaited Olympics. The Olympics will make Gatwick a very important part of the world, which is why I am keen to see it prosper.
The consultation document, “Adding Capacity at Heathrow Airport”, suggested that a second runway at Gatwick is unlikely, and we must focus carefully on what will happen now. Mark Froud, the chief executive of Sussex Enterprise, said that Gatwick was “on the
subs bench”, which graphically describes its position. However, it now looks like Gatwick has been shoved off the “subs bench”, and it must now define its future in a different way, which is why I am raising the matter with the Minister. It seems likely that Heathrow will meet its environmental obligations, and I therefore want to ensure that Gatwick is not forgotten in those debates.
Opinion was very much divided on whether expansion was a good idea; my constituency was split 50:50. However, opinion is certainly not divided on how well Gatwick would do with a single runway.
Sir Paul Beresford (Mole Valley) (Con): Does the hon. Lady agree that, taking all the constituencies and residents in the areas surrounding the airport, opinion was hardly 50:50 on resistance to a second runway? In fact, it was a great relief that the second runway was apparently rejected.
Laura Moffatt: I do not presume to speak for other constituencies; I speak only for mine. I undertook a huge survey there, and the result was 50:50.
We are committed to the ongoing success of Gatwick airport; we want to ensure that it continues to be successful. As it is no longer earmarked for expansion, many issues need to be raised with the Minister in order to ensure a place at the table on future discussions; we want to be part of the family of UK airports and to play our role, stepping up to the mark so that we can meet future challenges.
Maximising use of the single runway and increasing passenger numbers to 40 million is the goal. I want to ensure that we are lucky enough—perhaps not lucky; Gatwick has earned the investment of others—to ensure that Gatwick airport does not pay for expansion elsewhere. I ask the Minister to say a few words about that; it is very important that we do not find ourselves being used as a cash cow to pay for investment at other airports, and I know that many people from around Gatwick would feel most uncomfortable were that to happen.
The 2003 White Paper considered all UK airports. I ask merely that that debate continues on all airports, and that Gatwick has a seat at the table. I also want to ensure that Gatwick is not compromised by developments elsewhere. The much awaited T5 will open shortly at Heathrow, and redevelopment will continue there. Everyone accepts that it is desperately needed, as it is the UK’s first and largest airport. However, I want to ensure that Gatwick remains viable while that work progresses. We can see that it will be a challenge for Gatwick, but we need to tackle the challenges head on, and deal with them. We can do that only if we are provided with a seat at the table.
Other pressures are pertinent to the debate. Large areas of land around the airport were sensibly safeguarded while the debate was going on. It was the only fair and honest way to tackle a debate in which all airports were being considered for redevelopment and for further runways. That scheme was administered by BAA. Now that the debate is settled, we need clarity on what is going to happen to that land.
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