Health and landscape review

Health Landscape Review

Notes requested during the PAC hearing Tuesday 25 January

Q112 <Stephen Barclay:> Given that the Cabinet Office have said that they want monthly data from Departments on consultancy spend, can I assume that you will be publishing monthly what is spent on consultants, interims and professional services, both in terms of the Department centrally and any of these other agencies set up as part of the reforms?

Una O'Brien: All of this will be made more transparent by the Cabinet Office. Just for the record, because I do think it is important, I know you have observed the scale of DH spending on consultancy in the past, but in the first six months of this financial year, our consultancy spend was £12 million. The full year cost for 2009-10-last year-was £155 million. So I think that just gives you a sense of the dramatic reduction in consultancy spend. We are absolutely, across Government, committed to bringing this down and indeed it is going to be a very important opportunity for civil servants to build their skills and to really make the most of what we have learnt from working with consultants in the past.

Q113 <Mr Bacon:> Of that £155 million down to £12 million, how much is NPfIT?

Una O'Brien: I could not give you the breakdown, but I am happy-

<Mr Bacon:> Could you send us a note?

Una O'Brien: I am happy to do that, yes.

Answer:

The significant reduction in consultancy spend is a result of:

· The implementation of the Efficiency Reform Group (ERG) efficiency controls through a more robust approvals process, together with Ministerial scrutiny of requests for consultancy expenditure across DH, CFH and ALBs has led to a much lower level of demand and more cases being turned aside or refined. This has meant that in some cases more cost efficient alternatives have been found (for example, use of DH civil servant staff through work re-prioritisation, or use of specialist contractors where not feasible to use civil servants). There has been a significant reduction in the number of new purchase orders raised (and relative expenditure against these) with the top 6 consultancy firms in 2010/11.

· Reductions in consultancy expenditure for specific programme areas, for example planned reductions in Pandemic Flu of circa £5m - this was a planned reduction and related to Ernst and Young activities in 2009/10 to support the development of pandemic flu preparedness capability. This support was completed, as planned, by the end of March 2010.

· Alignment of the definitions of consultancy procurement activity, in line with OGC definitions, resulting in a reduction in the number of procurement activities previously recorded as consultancy. This has taken place through improvements in business processes and understanding and therefore is very difficult to quantify. This will also have resulted in an increase in specialist contractor expenditure. There is no simple way of quantifying the movement of expenditure towards specialist contractors as a result of improved definitions and coding, as opposed to an increase in expenditure as a result of a change in approach to delivering the work (see first bullet above).

The National Programme for IT (NPfIT) element of the total consultancy figures was £6.3m in 2009/10, compared to £1.6m at Month 6 2010/11. Please note that £1.6m expenditure had occurred at the mid-point of the year only, and the 2010/11 figure has increased to £3.4m at Month 9. This suggests a downward trend in expenditure in this area. It is worth noting that the consultancy element in relation to NPFIT relates to legal consultancy advice required to the contracts for NPFIT, rather than the NPFIT delivery itself.

Q167 <Dr Creasy:> No, the issues is about budgeting where the money goes and who is held accountable for how it is spent, because right now, we challenge the PCT. If you take away the PCT and you are now leaving those decisions to the GP commissioners or the risk pool, at some point people are going to fall through the cracks unless there is an adjudication mechanism.

Sir David Nicholson: Well you will hold the consortium to account in the way that you hold the PCT to account.

Q168 <Dr Creasy:> And the consortium says it should be the risk pool; the risk pool says it should be the consortium. Who will make an intervention in that process? Where is the accountability for that decision?

Sir David Nicholson: Well the accountability is the consortium’s accountability to their population.

<Chair:> There is a lot evolving, so I think you should take this one away and if you can write to us with clarity on it, that would be really, really helpful. We are not trying to catch you out, but to ensure that there are proper accountabilities, particularly in a situation where we have reducing real budgets, where this could occur. But I am really pleased to hear you can have your double cataracts wherever you are because somebody is going to pick up the tab.

Answer:

GP consortia will be accountable to the NHS Commissioning Board for managing public funds and for the outcomes they achieve. In turn, each consortium will hold its constituent practices to account against these objectives. All consortia will need to appoint an Accountable Officer. The NHS Commissioning Board will have the power to intervene in consortia, but only where there is evidence that consortia are failing or are likely to fail to fulfill their functions. We propose that consortia should have the freedom to make commissioning decisions that they judge will achieve the best outcomes within the financial resources available to them. At the same time, the economic regulator and NHS Commissioning Board will develop and maintain a framework that ensures transparency, fairness and patient choice.

Consortia will be supported by the NHS Commissioning Board, who will be responsible for the allocation and accounting for NHS resources. This stewardship role will include calculating practice level budgets and allocating these budgets directly to consortia. It will also have responsibility for the financial stability of commissioners and for accounting to the Secretary of State for NHS commissioning expenditure, underpinned by robust financial management measures at consortium level. There is no "one size fits all" rule regarding the size of consortia and the key criterion for deciding on a consortium’s viability will be that the NHS Commissioning Board is satisfied that prospective consortia have appropriate arrangements in place for discharging their functions.

Regarding the potential conflict between GPs’ duties to their patients and their duties as commissioners, the first duty of doctors will always be to their patients. The GMC’s Good Medical Practice Guidance, which describes what is expected of all doctors registered with the GMC, says:

‘You must give priority to the investigation and treatment of patients on the basis of clinical need’ and ‘You must act in your patients’ best interests when making referrals and when providing or arranging treatment or care.’

Q190 <Nick Smith:> Can I just come back to the question? Are there any other health services across the world that have this internal banking suggestion that you put forward?

<Chair:> Write to us about that.

Una O'Brien: I just do not have that information at my fingertips, but of course I will write to you.

Answer:

The proposed NHS banking function will provide loans to NHS trusts who require cash. We would expect the NHS banking function to provide the type of loans currently administered by DH for NHS Trusts and NHS Foundation Trusts. In both instances, these are primarily for capital investment and are not an indication that the trust is in any financial difficulty. Quite the contrary. Trust loan applications need to demonstrate the long term requirement for the capital investment in response to patient need for services and the affordability of the loan. DH also provides to Foundation Trusts who may have a shortfall in cash for operational reasons, again these trust will need to be able to demonstrate that a loan is affordable and will be repaid .

The proposed banking function is an evolution of these current arrangements and a necessary part of the reforms. The taxpayer will continue to have a large investment in Foundation Trusts and there will be a need to provide loan financing for Foundation Trusts in the future. It is important to ensure that there is a balance between managing this investment in the best interests of the taxpayer, but also ensuring that new loans are subject appropriate scrutiny and only made where repayment can be expected to the agreed schedule . Powers proposed in the bill reinforce these principles and require a transparency of operation consistent with the banking function's relationship to an liberated Foundation Trust sector.

We are not aware of any other health systems who provide support to hospitals through such a banking function. As we understand it there are varying degrees of national and local / regional administration and financing of publicly financed healthcare. However, as with all health systems, the NHS has evolved over an extended period and our proposals for such a banking function and a natural and necessary development.

Q191 <Stephen Barclay:> Three specific questions from me; I am conscious of time. In the new landscape obviously the reforms rely on the role of the GPs. Just picking up on one of the earlier points about unforeseen events, can I just clarify whether the final salary pensions of GPs are within the scope of Lord Hutton’s review and, given how powerful the GP trade body is, as we saw from their previous contracts, is there any risk attached with changes to GP pensions?

Sir David Nicholson: I couldn’t answer that question; I will have to send you a note on that.

Answer:

The current pension arrangements for GPs were negotiated with trade unions, including the BMA, in 2008. Unlike other members of the NHS Pension Scheme whose pensions are based on their Final Salaries, GPs have their pensions based on a Career Average basis. This is otherwise known as career average revalued earnings scheme (CARE). Arrangements for GPs' pensions are within the scope of the review by Lord Hutton , to ensure that they are fair to both employers and taxpayers.

Q192 <Stephen Barclay:> Thank you. Out-of-hours GPs has obviously been a hot topic and a big constituency interest of mine; it was my constituent Mr Gray who was unlawfully killed by the German out-of-hours GP Dr Ubani, who is still able to practice in Germany although he is banned in the UK. So there is an imbalance firstly between someone being able to work here because they are qualified in Germany but being banned here and not being banned in Germany. The GMC do not have unfettered control in setting language and competency tests for European qualified doctors when they come to the UK. It may be something you want to send me a note on, but I would be very keen to establish by what time UK legislation is going to allow the GMC to set the language and competency tests in the new health landscape in order that they can ensure that those coming to this country are correctly qualified and can speak the language.

Sir David Nicholson: We will send a note on that, yes.

Answer:

The Medical Act 1983 currently makes no provision for the GMC to be able to require EEA doctors seeking registration to sit language or competence tests. However, it is not simply the case that domestic legislation could be amended to enable the GMC to undertake checks on the competence and language knowledge of EEA migrant doctors. Whilst this would remove one impediment, any arrangements for language testing of EEA doctors would still need to be proportionate in order for it to be consistent with Directive 2005/36/EC to enable the United Kingdom to meet its treaty obligations.

Under the automatic recognition procedures provided for by Directive 2005/36/EC, the GMC is required to check that doctors from the EEA applying for inclusion on its Register hold a recognised qualification, listed in the Directive that has been issued by an EEA competent authority. This qualification attests to fact that the individual has met common European minimum standards of training. The Directive specifically provides for certain additional checks to be undertaken, such as identity checks and character references, but there is no provision for competent authorities to apply additional checks on language and competence at the point of registration.

Our assessment therefore is that the Medical Act 1983 cannot be amended to enable the GMC to undertake systematic blanket testing of the language skills of all migrant workers from the EEA, or to impose additional tests of competence before registering them because of the requirements of the Directive. Registration depends on whether or not the migrant has the appropriate qualification to practice their profession. It does not mean that a professional has demonstrated that he or she is fit to do a particular job in a particular place.

The responsibility lies with the employers of doctors to ensure that they have adequate skills for a specific post to which they recruit.

The European Commission has begun its review of the implementation of the Directive, which is due for completion 2011 with any new proposals to be put forward in 2012. The review will involve all 27 Member States. The UK Departments involved in the operation of the Directive agreed to hold a mini review in 2009/2010. The Department of Business, Innovation and Skills (the lead Dept for the Directive) sent out a questionnaire to all UK regulators and analysed the replies, which included those from the health regulators which produced a report on the first two years of operation of the Directive.

The completed report was copied to the regulators and the European Commission who had specifically requested a copy of the report, which helped inform the Commission of the content of their review. The issue of language testing was raised in the report.

The Commission’s review began with experience reports being completed by the competent authorities throughout Europe with responsibilities under the Directive for the regulation of doctors, nurses, midwives and pharmacists. The regulators came together in a network to discuss the issues and, in the case of nurses, the European Commission appointed the NMC as the lead regulator for nurses. However, there is no guarantee that the review will lead to any changes to the Directive and it is worth noting that only the European Commission can propose amendments to EU law in this area.

Any amendments to the Directive would be likely to take several years to be fully implemented and therefore we believe that the priority should be to concentrate on strengthening language checks under current scope of the law. The Government therefore believes that this is the most appropriate way of delivering the Coalition Agreement commitment to seek to stop foreign healthcare professionals working in the NHS unless they have passed robust language and competence tests. In particular, we plan to explore how the NHS Commissioning Board, could oversee a more effective system for undertaking checks on language knowledge of primary care. At the same time we continue to explore actively with the GMC whether there is the scope for a GMC scheme that would be consistent with the Directive and which would enable a proportionate approach to testing, where there was a concern, whether individual doctors had the right language skills for the role they intend to take up.

Q193 <<Stephen Barclay:> The third thing is around confidentiality agreements for clinical staff who have left their posts for nonclinical reasons or for whistle-blowers. This really ties into Amyas’s point around your ability as the accounting officer to meet Sir Nicholas Macpherson’s test, which, as he set out, is in order that you can satisfy yourselves that the financial systems in place in organisations are correct. Could you clarify in the new landscape whether those sorts of confidentiality agreements are going to be allowed to continue?

Una O'Brien: It is not something I have any reason to think is changing, but I will certainly verify that.

Q194 <Stephen Barclay:> I am very keen for it to change; that is my point. Do you have sight-

Una O'Brien: Could you rephrase your question?

Q195 <Stephen Barclay:> Yes, okay. At the moment there is concern that whistle-blowers or clinical staff who-

Una O'Brien: That their confidentiality is protected?

<Stephen Barclay:> Well, the Trust that is potentially at fault-or there are serious issues within the hospital that the Trust management may want to cover up-are signing confidentiality agreements with those clinical staff that in essence cover up what has gone on.

<Mr Bacon:> Some years ago the NAO did a report on the management of the suspension of clinical staff in situations where their clinical competence is not in doubt. The most famous case that comes to mind is that of Dr Raj Mattu, which ran for several years. He was a cardiologist who pointed out that the hospital management’s proposal for changing the number of specialist units-so that instead of having one per patient, you would have, shall we say, four sets of machines for five patients on the basis that that would probably be all right most of the time-was actually causing deaths. He was suspended, but there have been lots of other cases-the NAO did quite a substantial report on this many years ago now-where clinical staff were suspended by a Trust where their clinical competence was not in doubt and then public money was used to pay them salaries for sometimes 18 months, two years or even longer, while the NHS managers-in this case a foundation trust-and the employee-the competent clinician-were in a longrunning dispute that got settled more or less satisfactorily from somebody’s point of view and was then subject to a confidentiality clause, including quite often a big payoff.

<Chair:> I think you are going to have to write to us on this one.

Answer:

The Public Interest Disclosure Act 1999 (PIDA) applies to workers and is designed to protect them from detriment in the workplace as a result of making a protected disclosure. If a worker was suspended solely as a result of making a protected disclosure, then this could be considered detrimental to the employee under PIDA and the employee could challenge this action.

In relation to ‘gagging clauses’, the Department’s stance has not altered since 2005. Contracts of employment are a matter between the employing organisation and its employee. It is likely that most contracts will include some form of confidentiality clause as employees will have access to sensitive patient and commercial information that should not be released. However, the Public Interest Disclosure Act 1998 provides that any clause or term in contract, or other agreement between a worker and their employer, is void insofar as it purports to preclude the worker from making a protected disclosure.

The Department made clear, in a Health Service Circular on the Public Interest Disclosure Act (HSC 1999/198), that local policies should prohibit confidentiality gagging clauses in contracts of employment and compromise agreements which seek to prevent the disclosure of information in the public interest.

On 9 June 2010, the Secretary of State announced a full public inquiry into the role of commissioning, supervising and regulatory bodies in the monitoring of Mid-Staffordshire Foundation Trust. As part of this, he also stated his intentions to undertake further work on whistleblowing and to improve procedures for those who wished to raise concerns. These include:

· Issuing unequivocal guidance to NHS organisations that all their contracts of employment should cover staff whistleblowing rights – This has been published on the NHS Employers website on 13 September 2010.

· Seeking through negotiations with NHS trade unions to amend terms and conditions of service to include a contractual right to raise concerns – These were agreed through the Staff Council and published on the NHS Employers website on 13 September 2010.

· Issuing guidance to the NHS on supporting and taking action on concerns raised by staff – This has been completed and as stated earlier published on 25 June 2010.

· Reinforcing the NHS constitution to make clear the rights and responsibilities of NHS staff and their employers in respect of whistleblowing – A full public consultation ran from 12 October 2010 – 11 January 2011 to gauge public opinion on the possibility of adding:

Ø an expectation that staff should raise concerns at the earliest opportunity;

Ø organisations should pledge to support staff when raising concerns; and

Ø the Constitution should have greater clarity around the ability of staff to raise concerns.

· Exploring with NHS staff further measures to provide a safe and independent authority to whom they can turn when their own organisation is not listening – This option is currently being explored by the Department.