Achievement of foundation trust status by NHS hospital trusts - Public Accounts Committee Contents

Examination of Witnesses (Question Numbers 1-91)

Dr Chris Gordon, Julie Lowe and Clare Panniker

19 October 2011

Q1     Chair: Our paperwork is not in the best of order this afternoon. Although I know who you are, usually we have a biography of each of you before we proceed with the questions. I wonder whether you would start, Julie Lowe, by telling us who you are and what your job is so that people have an awareness.

  Julie Lowe: My name is Julie Lowe, and I am chief executive of Ealing Hospital NHS Trust, which also incorporates the community services of the boroughs of Brent, Harrow and Ealing.

  Dr Gordon: I am Dr Chris Gordon, and I am acting chief executive of Winchester and Eastleigh NHS Trust.

  Clare Panniker: I am Clare Panniker, and I am chief executive of North Middlesex University Hospital.

  Ian Swales: Can I be clear whether these witnesses are from foundation trusts?

Q2     Chair: No, they are all in the group of 20 that have declared that they cannot be, in their current form—I chose them for that reason—but they are all doing slightly different things. I chose them because they are in the self-declared group of 20, but it is self-declared not assessed. This part of the afternoon will be a shortish part and we want to get as much information as we can out of you, but equally if you can be direct and succinct in your answers that would help the Committee enormously in our work.

  Can I ask, first of all, were you all briefed by the Department of Health before you came to us this afternoon?

  All witnesses: Yes.

Q3     Chair: Why was that?

  Dr Gordon: Why was there a briefing? I think to understand the functions of the Committee.

Q4     Chair: Or was it to ensure that you all spoke with one voice?

  Dr Gordon: I can only speak with my own voice—

  Mr Bacon: You can try to speak in everyone's voices; it might be quite interesting.

  Clare Panniker: It was clear that we must give our own opinion, but that we should understand what the Committee is about.

Q5     Chair: Okay, but it was not in the context of sticking to Department of Health or Government policy.

  All witnesses: No.

Q6     Chair: You have some independence from that. Yes? Good. You are all doing rather different things, so the reason I chose to have evidence from the three of you is that you are all in the group of 20 that have declared that they do not think they can achieve foundation trust status, but you are approaching it in very different ways. Can you briefly, starting with Julie Lowe, tell us how you are approaching it?

  Austin Mitchell: Chair, why are they self-relegated? What is the problem in each case?

  Chair: We can ask that. Let us find out who they are.

  Austin Mitchell: We need to start with that.

  Chair: I was going to give them the opportunity to speak, because they are all going in slightly different directions, and then you can come in on that. Just let them explain who they are.

  Julie Lowe: It will probably come out when we explain where we are. Ealing hospital, as some of you may know, is a small district general hospital in west London. It was built about 30 years ago and serves a population of some 300,000, but a lot of that population look to our neighbours because it is quite a crowded pitch in north-west London. There are lots of hospitals.

  As health care moves forward and becomes increasingly sub-specialised, and as we move into a world in which more care is delivered directly by consultants and very senior staff, rather than by junior doctors, we are struggling cost-effectively to provide such cover and such a level of specialism 24/7. We originally applied to be a foundation trust, but in discussion with our neighbours and NHS London—

Q7     Chair: You failed.

  Julie Lowe: No, we didn't fail. We applied to be a foundation trust. We discussed what the long-term future, beyond four or five years, would look like, and we felt that on our own we would not be able to provide a high level, modern standard of health care as health care becomes increasingly sub-specialised, so we decided that we needed to do something different. The first thing we did that was different was to take on the management of the three community wings of the three boroughs, as I explained, because we believe that the future of health care is increasingly in providing care closer to people's homes and in community settings.

Q8     Chair: You are going to stop being a hospital—I am hurrying you up—that is my understanding.

  Julie Lowe: Okay, so we have got the community services. We need, then, to look at what we do around our acute services, especially—

Q9     Chair: You are going to stop being a hospital.

  Julie Lowe: No, we're not; we are going to work with North West London Hospitals to see whether a merger between us is viable so that we can continue to provide hospital services where appropriate for us to do so.

Q10     Chair: But the reason I have chosen you is that my understanding is that you are going to stop being a hospital and you are going to focus on community-based health services.

  Julie Lowe: It would be wrong for us to stop being a hospital, because there is still a need for hospital-based services.

Q11     Chair: What are you going to provide that I and we would understand as a hospital?

  Julie Lowe: We are working through what that will look like at the moment.

Q12     Chair: Give us some idea. What sort of things? If I were a resident in your area, in Ealing, what would I use you, as a hospital, for?

  Julie Lowe: We are keen that there is a front door that—

Q13     Chair: Will you deliver babies?

  Julie Lowe: At the moment, we deliver 3,000 babies a year—

Q14     Chair: What will you do?

  Julie Lowe: —and we need to work through whether it is appropriate for us to continue to deliver babies in the long term.

Q15     Chair: Will you deliver babies? It sounds to me as though you won't.

  Julie Lowe: We don't know that yet. We cannot categorically say whether we will or won't.

Q16     Chair: I understand that you are going to cease hospital services, and that is why you are here. Actually, you have taken a decision, more or less, just to do community-based services.

  Julie Lowe: No. That is not the decision we have reached, because if it were, we would stop, at the point we are at, running three boroughs of community services and a hospital—

Q17     Chair: Are you going to have an A and E there?

  Julie Lowe: We have an A and E at the moment, and North West London has two A and E departments. We are committed to providing 24/7 access to services on the site.

Q18     Q18 Chair: But what? As a walk-in centre, not as an A and E.

  Julie Lowe: No, we have an A and E department that provides a full range of services.

Q19     Chair: I hope you are being honest with us—

  Julie Lowe: I am being honest with you.

Q20     Chair: —because that was not my understanding of where you were at.

  Julie Lowe: I am sorry about that, but we do have a 24/7 A and E department that provides a full range of services.

Q21     Ian Swales: But what will you have? That is the question the Chair is asking. It is not about what you have now; it is about what you will have.

  Julie Lowe: Yes, and as I have said, I do not know that yet, because we have entered the next phase of our discussions, which are with North West London Hospitals, about whether, by coming together, we can provide a viable range of clinical services. The local population, particularly in Ealing, is a big user of hospital services and always has been, so we are keen to make sure that there is accessibility in that locality for them, because it would be difficult for them to travel to any of the immediate neighbours for the full range of services. What we cannot do is continue to provide everything. For example, we closed our stroke unit, because we were not—

Q22     Chair: I think this is getting too long; we have lots to get over.

  Dr Gordon: Winchester and Eastleigh Trust, after a long period of consideration and a number of discussions with the SHA around achieving foundation trust status, has recognised that we were unable to get there on the ability to generate a five-year plan that produced a long-term recurrent surplus. So there was an ongoing financial issue.

  Plus, because of the size of our organization, we need to start getting together with other organisations on a more consolidated basis so that we can account for future clinical development, sub-specialisations, junior doctors' rotas and various other things that we think will make it more difficult for hospitals of our size to provide a service in future. With the SHA and the PCT supporting us, we went to develop a clinical strategy, to look at our options, and to choose the sort of partners that we wanted. We have chosen Basingstoke and North Hampshire Foundation Trust as our future partner, and we are going to become a foundation trust by acquisition.

Q23     Chair: Okay. I understand that you are the most advanced in that development.

  Dr Gordon: That is correct.

Q24     Chair: Does that mean that we will end up with three A and Es and three maternity units, or are you going to reduce that?

  Dr Gordon: There will be two emergency departments and two maternity units.

Q25     Chair: From three to two.

  Dr Gordon: No, there are only two at the moment. We have two district hospitals and a community hospital.

Q26     Chair: Why does the merger make you viable?

  Dr Gordon: The merger makes us viable for a number of reasons. There are financial efficiencies from absorbing back-office costs from two organisations into one, which is really important, and estate rationalisations. We will be able to get procurement functions and greater critical mass; there is a simple financial efficiency. There are clinical efficiencies, because instead of there being seven radiologists on one site and six on the other, we now have 13 radiologists with which to provide a 24/7 sub-specialised rota. That goes through all the specialities.

  We are on two distinctive sites, so it is not quite as easy as it might seem, but we are also at increased clinical viability. We now subtend a population of around 500,000 to 600,000, which allows us to develop those ranges of services.

Q27     Chair: Even on two sites.

  Dr Gordon: Even on the two sites, but with 250,000 each we would not be able to do that. Because of the geographies of our two sites, it will be important for us to continue to provide a wide range of acute services on both sites. That has been said by the acquiring foundation trust and by the current commissioners, NHS Hampshire.

Q28     Chair: Okay. Clare Panniker. Again, the reason I thought it would be interesting to hear from you is that you are talking to another hospital that the Secretary of State announced will no longer deliver either A and E or maternity services—Chase Farm.

  Clare Panniker: That is right.

Q29     Chair: You are merging with a failing hospital, whereas Chris Gordon is merging with a working foundation trust?

  Clare Panniker: Well, there are two distinct parts to this. One is the clinical strategy that was agreed and consulted upon publicly in 2007, which saw the reduction of service at Chase Farm, turning the A and E into an urgent care centre and removing the consultant-led maternity services from there. That was agreed back in 2007 and significant amounts of that activity, because of the way the geography works, would flow into North Middlesex hospital. We have had some delays in implementing that strategy but, as the chair said, the Secretary of State in September agreed that we could go ahead. As a separate part of that decision, he also asked us to look at the feasibility of North Middlesex taking management responsibility for the Chase Farm site—that is, separating it from Barnet and coming under the wing of North Middlesex. That piece of work is currently under way and we will report back to the Secretary of State on 16 December.

Q30     Chair: Are you driven by the fact that you have a PFI, so to fund the PFI and North Middlesex you have had to merge with Chase Farm and close the services there?

  Clare Panniker: At the time we agreed the contract for the PFI in 2007 we anticipated small amounts of growth. The economic climate and the care close to home—

Q31     Chair: Is it true? Is that driving the decision?

  Clare Panniker: Decisions were made to invest in the North Middlesex site knowing that the Chase Farm site would downgrade, so the North Middlesex, with the current economic climate, needs that additional activity.

Q32     Chair: But to be fair, both the previous Secretary of State and this Secretary of State promised that they would not close Chase Farm.

  Clare Panniker: Well, that is not my decision.

Q33     Chair: So you mean the decision was taken to put a PFI in—

  Clare Panniker: In 2007.

Q34     Chair: —on the basis that you closed some services at Chase Farm. I know that you said that it will still be there, but it won't be in five years. But let us take that as given. Then both political parties—the previous Government and this Government—agreed to keep Chase Farm, knowing that the investment in North Middlesex was predicated on the closure of Chase Farm.

  Clare Panniker: No. The decision to invest in the PFI in 2007 was made independently. There was no inference that Chase Farm needed to close to fund the PFI. But things have moved on since then and the care closer to home agenda has moved on. The economic climate has moved on. The overprovision of hospital services is a key factor in north London.

Q35     Chair: It is not the overprovision of services. What you have is the financial pressure emerging from a £137 million PFI.

  Clare Panniker: There is a PFI on the site. That was a decision that was made some years ago. It provides state of the art health care provision. Neither Chase Farm nor the North Middlesex had sites that were fit for the future. They were both serving the population in crumbling buildings.

Q36     Chair: What is going to be different with two failing trusts to make them, when merged, a successful foundation trust?

  Clare Panniker: Well, I would challenge the label "failing". North Middlesex has delivered surpluses for the last five years and has continued to improve clinical quality, so I don't regard North Middlesex as a failing organisation. There may be some merit in creating a hospital for Enfield people that is situated at North Middlesex and at Chase Farm that works closely with the Enfield commissioning group and with the Enfield local authority. There may be merit in that and that is what we are testing at the moment.

Q37     Chair: Okay. I just have to say that looking at the NHS's own publication under the quality of services your performance is "under review". Under maternity services, late 2010 showed that "trust rated worse than other trusts in nearly all categories." In March, "trust was warned that its neonatal unit was dangerously understaffed" and under user experience, you are "underperforming". It was reported in September that more than half of the patients seen at North Middlesex university hospital trust in June had waited more than 18 weeks for treatment.

  Clare Panniker: In September, that position on waiting times fully recovered.

Q38     Chair: But that is not a very good record from the stuff that I have read out.

  Clare Panniker: The issues that you identified are all related to patient experience. We know that we have some challenges in ensuring that we score well on patient surveys for our very ethnically diverse and mixed population. That is an agenda that the trust board is prioritising and taking very seriously.

Q39     Chair: It is not patient experience; it is quality issues.

  Clare Panniker: Most of the drivers around that were related to patient experience.

Q40     Chair: What you are there for is to offer a service to patients. Whether it is maternity services, neonatal or seeing people within 18 weeks of treatment, you are not doing very well. That is a fact. You can call it patient experience, but you are there for patients to experience a good service.

Q41     Austin Mitchell: You are all in a state of uncertainty—Dr Gordon least of all—but in this state of uncertainty, while the future aims are decided, what is the effect on recruitment and staff morale? It must be disastrous to be in a hospital that has declared itself failing and which is going to merge or lose services. What is the effect?

  Julie Lowe: Again, it is important to differentiate the words "failing" and "unviable in its current form". All three of us have said that our current form is not the right form to take our services forward for the future. In the case of Ealing, one of the main drivers for us to explore a merger with North West London Hospitals is the fact that our clinical staff have told us that they would feel happier in a bigger department in many cases where there is sufficient expertise to sub-specialise.

Q42     Austin Mitchell: Yes, but if the staff want to get out, you must find it difficult to attract new staff.

  Julie Lowe: Staff that are with us already are very keen to work with us to develop the opportunity to work in what will be a very big local organisation caring for our local population. Recruiting staff is always difficult when there is any uncertainty. One of the things that we are keen to do is to get through this—not as quickly as possible, but with due process—in good time so that we are not prolonging the period of time when there is uncertainty. You are correct in terms of recruiting new staff; it can be very difficult, particularly to attract senior staff, at a time of uncertainty.

Q43     Austin Mitchell: If I were employed there, I should be rushing to leave the sinking ship. Dr Gordon, what is your advice?

  Dr Gordon: I think you would be making a mistake, Mr Mitchell. People are very loyal to their organisation. They hate uncertainty; they want to know what is going on. Once they know, they can start working to that model. As soon as my people understand that they are going to be working for a new foundation trust with a new geographical area and a new clinical model, they start working in their own heads to understand how that will work for them and for the patients they currently serve, so naturally our clinicians will look for opportunities.

  We have concentrated really hard on looking at the opportunities that will come out of this, of which there are many, and people can see those opportunities. We have had fantastic support from our staff looking to the future. It has been a very brave thing that people have done—to be able to look above the parapet to see what the future is for a stand-alone organisation over the next five years and go for something that feels initially at risk, but actually will turn out to be something much better.

Q44     Austin Mitchell: Clare Panniker, any panickers on your staff?

  Clare Panniker: Very good. No, they are not panicking at all because they see that the North Middlesex is a fixed point in terms of providing acute services to a very needy local population.

Q45     Ian Swales: I want to return to the PFI question. Have you all got PFI hospitals?

  Clare Panniker: Yes.

  Dr Gordon: No

  Julie Lowe: No

Q46     Ian Swales: One of you has. In your area, you are self-declared as not being viable in your current form. What proportion of your income goes in servicing the PFI debt?

  Clare Panniker: Eight per cent.

Q47     Ian Swales: Okay. To what extent are your services tied into the PFI contract?

  Clare Panniker: Only the hard estate management is tied into the PFI contract. We have separate contracts for all the other facilities management, such as cleaning and catering.

Q48     Ian Swales: You only have management of what—maintenance of the building?

  Clare Panniker: Just maintenance of the building.

Q49     Ian Swales: On the estate. You do not have expensive contracts for other services?

  Clare Panniker: No, we have separate contracts for the other services.

  Ian Swales: Okay. That is shorter than I expected. Thank you.

Q50     Joseph Johnson: I want to ask each of the chief executives what their understanding of the failure regime is. If you do not make it by 2014 to foundation trust status, Ms Lowe, what will happen to you?

  Julie Lowe: If we try to stay alone and we don't make it, we would get into a situation where we needed to be acquired by an NHS organisation that had achieved foundation trust status. We are trying to get into a merger and then through an FT process so that we are able to achieve FT in a new organisational form. That would be our preference.

Q51     Joseph Johnson: In other words, a shotgun marriage with any institution that will take you, come 2014.

  Julie Lowe: That is one potential solution. The other thing that could happen us to locally is that we lose more and more services off the site.

Q52     Joseph Johnson: So you die on the vine. Dr Gordon?

  Dr Gordon: As an organisation, we looked at the consequences of not moving a couple of years ago, and none of them looked particularly attractive. A gradual, progressive loss of services, worsening and worsening financial instability, with clinical crises that would follow—that is what has led us to this decision. We are not going to be seeing a failure regime, because very early in the new year we will be part of a foundation trust.

  Clare Panniker: Our TFA process takes us through the various steps that we need to go through to determine the best future for us. We do not have one fixed point. We are exploring the "Enfield hospitals" possibility, and if that is not feasible, there are other options that we will look at—a range of other partners.

Q53     Joseph Johnson: Ultimately, if your plan does not work, you will be in the same position, potentially, as Ms Lowe: you will either have to find a foundation trust to take you on, or you will simply close.

  Clare Panniker: It will be difficult to close, given that we have a long-term commitment around a PFI. It will be in everyone's interests for the local trust, with the support of the Department, to find a solution in advance of that.

Q54     Joseph Johnson: Very quickly, can you each say what your operating deficits are on an annual basis at the moment?

  Julie Lowe:   I do not think that any of us have operating deficits.

  Clare Panniker: An operating surplus of £3 million last year.

Q55     Joseph Johnson: You do not have a deficit?

  Clare Panniker: None of us has a deficit.

Q56     Chair: Julie Lowe, I could not get hold of your—what is this wonderful document called?—tripartite formal agreement. What words! Why have you not published yours?

  Julie Lowe: Ours was signed with the SHA and the Department only very recently because of the discussions about the merger. It will be going to our trust board next Thursday and will appear on our website with our public trust board papers next week.

Q57     Chair: Yours was also signed recently, but you got it out.

  Clare Panniker: It is published, yes.

Q58     Mr Bacon: I want to ask Dr Gordon one question arising out of what you said earlier. You made what sounded like a very persuasive case for the course of action that you are taking; you mentioned, just as an example, 13 radiologists being a lot better than six in one place and seven in another, and said that that went across all disciplines. It prompts the question: what is not to like? If you can do that and get so much more bang for your buck, why was this not done many years ago?

  Dr Gordon: I think 21 miles of Hampshire is probably the main cause of not having done it many years ago.

Q59     Mr Bacon: Twenty-one miles? Is that all?

  Dr Gordon: It is 21 miles of the M3. People are very proud of their organisations. We celebrated our 275th anniversary as a hospital yesterday, so I think that people like to retain their integrity. It takes a very brave organisation to look at its organisational future, and for a board to look at the possibility of voluntarily—

Q60     Chair: It is 21 miles between Winchester and Basingstoke?

  Dr Gordon: Yes.

Q61     Chair: And Winchester and Andover?

  Dr Gordon: 16 miles.

Q62     Mr Bacon: I represent a constituency in Norfolk, so these seem very small distances to me.

  Dr Gordon: I think it depends on your world view to some extent, doesn't it? It leads to a big decision from any organisations, whether you are 20 miles, five miles or 100 miles apart, to say, "We are viable now, and we provide a really good quality of service now but, in a few years' time, that will be really difficult; what is best for our patients?", and for the board to take the decision to go through a process that will dissolve itself.

Q63     Mr Bacon: While I was asking my question a minute ago, a chap behind you was smiling and nodding sagely in agreement. At least I think he was.

  Dr Gordon: That is my chairman.

Q64     Mr Bacon: That makes me wonder whether you think that it is probably fair to say—I think this is what you are saying, but perhaps you can confirm it—that were it not for local chauvinism with a small "c", there are probably lots of things that could have been done, especially when a lot of extra money was going in, that might have improved service quite a lot some time ago. However, they were not done because we were not in a financial crisis. They were providing a good service, they had other pressures, and it was not top of mind, so it did not get done. It is rather like how very profitable companies do not necessarily think about how to become even more profitable when, if they looked at their costs very hard, they probably could be.

  Dr Gordon: Sure. I do not think it is quite fair. I think it's really important to be—

  Mr Bacon: I am not trying to be unfair.

  Dr Gordon: No. I think it is important to say that the world does not move in explosions too often, hopefully. It moves gradually, in the way that we change. If you think about the way that, over the past 10 years, we have come to look after cancer in networks; the way that, over the past five years, we have come to look after stroke through networks; and at the vascular trauma networks, on which we are going through a consultation process in Hampshire, it is all about networking across different organisations. It is a huge change in culture for many people. Organisations that evolved before the NHS, into the NHS and into the future are now grouping together and working together in networks. It is only natural that, for some organisations, that can be taken further, into an organisational union to support those services.

Q65     Chair: Some of us represent slightly different constituencies. It depends; if you have a car, you are okay and another 10 miles might not kill you, but if you are dependent on public transport, you are in trouble.

  Dr Gordon: Public transport links are good up and down the M3 corridor. It is really important that local services are provided. You have to find the balance whereby you can provide local services to a local hospital, but where critical mass makes it important, for some services, people are sometimes prepared to travel a little bit further.

Q66     Chair: So you will reconfigure services in this new trust?

  Dr Gordon: I cannot say that. There are no plans.

Q67     Chair: You will.

  Dr Gordon: To take this back to the consultation around stroke services, for instance, the proposal in the public domain in the NHS Hampshire stroke consultation is that the hyper-acute service for north and mid-Hampshire will be centred for immediate care around Winchester, for the Winchester and Basingstoke area. For some extremely urgent things where critical mass is really important, those processes are already happening.

Q68     Mrs McGuire: I should declare an interest: my husband was carted into the Royal Hampshire in the back of an ambulance—you do not look as though you recognise me, do you?—with a compound fracture in his ankle. I can only say that the treatment he received was excellent. I also have a niece and a nephew who were born in the Royal Hampshire. I do not know if that makes me biased. You might wonder why an MP from Scotland has that connection with Hampshire—

  Dr Gordon: I was wondering about that Hampshire accent.

  Mrs McGuire: I am happy to explain to you later.

  I want to concentrate on the Winchester and Basingstoke area, partly because I know it, but partly because it replicates something that happened in my constituency. We had two district hospitals, which were effectively exporting medical cases and not attracting some specialisms into the hospitals because they could not provide the critical mass, training and so on. In many ways, although there was an issue about staff, the big issue was how to persuade the local communities that they would still get a service that met their needs.

  Frankly, I think that people understand the need to travel for specialist services. If you need a brain surgeon or specialist cancer treatment, the chances are that you will have to travel, but most people's interaction with a hospital is like the compound fracture of the ankle at 12 o'clock at night. What are you doing to ensure that you get the new "clinical model", as I think you called it, into some sort of balance, so it is not just about the staff and their personal and professional development, but also about how the local community sees delivery of services nearby? Like Richard, I have a large constituency in which people travel more than 21 miles, but that does not undermine the rationale of my question.

  Dr Gordon: Absolutely. You are absolutely right. There is a really important balance to be struck on where we put services, but also on how the public perceives what services might be available. If you are going to what is an acquisition, people might think that things are going to be moved away from an area. For some services, such as unscheduled care, a very large proportion of our patients over 80 are acutely unwell and need to come in through an emergency service in their local hospital, so it is important that we are very clear that we provide that. We have gone through this process with our current commissioners and with our future clinical commissioners—the GPCCs, as they were called at that stage.

Q69     Mrs McGuire: That might change in time.

  Dr Gordon: They are CCGs now, or whatever. They have been on board with this model, and they have been involved in that process. We have also been in consultation with Hampshire county council's health overview and scrutiny committee. My foundation trust colleagues and I have been to speak with Andover borough council, Test Valley borough council, Eastleigh borough council and Winchester borough council to understand what the population feel. There will still need to be an incredibly important engagement process to continue to inform the population as to what services are available at these hospitals.

Q70     Mrs McGuire: Can I flip this on its head? So far I have not heard people mentioned; I have heard about councils and authorities, but I will give you one word of advice that comes from my experience in the Forth valley area: if the authorities go out and consult with people on the ground—not the councils, not any intermediary—and actually try to have an understanding of what people are expecting from their hospital services, you get a better model. It would probably be one that is not that far removed from what you are proposing. People need to understand it and, frankly, I do not think that you can always work through intermediaries such as councils or MPs or whatever. Sometimes you actually need to meet real people.

  Dr Gordon: I am sure that you are absolutely right. We talk to our patients a lot about this. We talk to the local populations about how we can get through to them. We are encouraging membership of the new foundation trust, which will be an important part of helping us to understand what patients want to experience.

Q71     Jackie Doyle-Price: I have a few reflections about leadership, because you, Dr Gordon, have outlined a good example of leadership, where the board has decided collectively on a course of action and engaged the public to deal with it. Obviously, going forward, the new trusts will have to depend much more on good-quality NEDs and senior management teams to take the institutions forward. It is interesting to pick out the characteristics of good leadership in this context. I want to ask each of you: do any of you have clinical backgrounds?

  Dr Gordon: Yes.

  Clare Panniker: Yes.

  Julie Lowe: I do not.

Q72     Jackie Doyle-Price: You do not; okay. In terms of non-executive directors, could you, Dr Gordon, say how easy it has been to attract a full complement of NEDs of sufficient quality? Has that been a challenge? From my perspective, it is patchy in different areas of the country. With varying degrees of ease, do you get the right skill sets?

  Dr Gordon: I entirely echo your sentiments about the need for leadership. Leadership at board level is crucial. I have to say, given the audience, that my chairman is a fantastic leader of our organisation. We have an excellent team of NEDs. Under his leadership we went through an awful lot of board development. It is really important that non-executive directors from a wide variety of places come together and really understand the machinations of the NHS, how a hospital works and the complexity of the organisation. It is important that the executives and chief executive—if they are clinical it makes it slightly easier—illustrate what the underlying meaning is for clinicians and what the strategy means for patients, the staff and the service going forward. We are going to need to ensure that our non-executive directors are brought in carefully, inducted into the organisation and given the level of knowledge that they need—I should not say this—to be able to challenge the executives on the information that they are given, and to have provided the clarity of information that they need to be able to make a judgment.

Q73     Jackie Doyle-Price: How long have you been in post?

  Dr Gordon: A year and a half.

Q74     Jackie Doyle-Price: And how long has your chairman been in post?

  Dr Gordon: Four years.

Q75     Chair: Julie?

  Julie Lowe: I have been in post for four years, and my chairman has been in post for three years, but he has been a non-exec on the board for much longer than that, because he was a non-exec before. I have been very fortunate, in that all of my non-execs have committed to staying with the process, subject to terms of office, and working with our staff, our patients and our local community to get us to our sustainable long-term future.

Q76     Chair: And Clare Panniker?

  Clare Panniker: I have been in post for almost eight years, and the chair has been in post for almost five.

Q77     Chair: May I ask, in drawing this session to a close, how you have dealt with financial cuts in 2010-11? Starting with Clare, for a change, what did you cut? Were you forced to cut any front-line services or front-line workers—midwives and other workers whom we have been hearing about? This is in the context of the King's Fund publication, which suggested that a lot of front-line services were involved. Was that the case in your hospital?

  Clare Panniker: On the contrary, actually; we have been recruiting midwives. We have had at least eight start in the past couple of months. We have also increased our substantive clinical staff—both doctors and nurses—over the past eight months or so. We have done that through reducing our vacancy rates, so that we have to depend far less on bank and agency. We have almost eliminated agency use within the organisation.

  We have made our cost savings by reducing the premium that we spend on temporary staff, but also through implementing new models of care. Just this week, we have started a new ambulatory service, which means that patients can be treated as out-patients. Things that we might have kept people in hospital for—IV antibiotics, for example—for weeks on end, they can now come and have done in the hospital on more of an out-patient-type basis, which has reduced our need for some of our in-patient beds. We have looked very much at other areas of productivity and efficiency, such as theatres, out-patients and improving processes within hospitals.

Q78     Chair: Thank you. Julie?

  Julie Lowe: I do not want to repeat everything that Clare said, but we spend a lot of money, as many London trusts do, on agency staff, and we are reducing that right down. On procurement, we are buying things more efficiently. We are providing more care at home, and building on our community links to try to reduce length of stay.

Q79     Chair: Have you been forced to cut what would be commonly accepted as front-line services or staff working in front-line jobs?

  Julie Lowe: No.

Q80     Chair: And Dr Gordon?

  Dr Gordon: There is no cut in front-line staff. We have managed to make cost-efficiencies through back-office savings, a reduction in management costs, using our staff more efficiently by reducing agency use, and making extra payments to consultants for extra work. There are also all the things that make our work better, including joint teams with social services and community services to shorten length of stay and to improve patient flow.

Q81     Chair: So you are all denying, for your individual hospitals, the assertion from the King's Fund?

  Dr Gordon: Absolutely.

Q82     Chair: Starting with Julie, do you feel more or less secure in the new world, where you will have to stand on your own feet, rather than being managed by David Nicholson? Well, you might still be managed by David Nicholson.

  Julie Lowe: I think being a foundation trust is tremendously exciting for a trust chief executive, and for a community like the one that I work in. The opportunity to be part of a local community and to have greater community involvement will be a tremendous benefit.

Q83     Chair: Will you get more community involvement? I cannot see that with foundation trusts. How?

  Julie Lowe: By having a council of governors and by having members, there is a real ability to engage.

Q84     Chair: Who are you getting in on that? Councillors? I think that was Anne's point.

  Julie Lowe: When we started to go through the foundation process in 2007-08, thousands of local people signed up to be members and were really keen to be involved, and they have remained involved, despite the fact that we have not pursued FT status.

  Chair: Do you want to add to that, Jackie?

Q85     Jackie Doyle-Price: This is where we get into the geographical discrepancies. Certainly with my local foundation trust, getting governors of the right quality to give appropriate accountability is a real challenge. To put all your eggs in that basket to monitor performance will not be enough; you will need to have better ways of community engagement. That will not be the panacea. Certainly, one issue for me is to make sure that Monitor hoists that into the system.

Q86     Chair: Clare, are you looking forward to the new world? The question was really whether you feel more or less secure.

  Clare Panniker: There is a big journey ahead, and there is a lot to be done. The prize is worth having, because the journey around developing the governance and the financial control is—

Q87     Chair: You think you will get there, do you? You have the toughest challenge.

  Clare Panniker: Yes, I think we will get there.

Q88     Chair: By 2014?

  Clare Panniker: I think during 2014.

Q89     Chair: And Chris Gordon?

  Dr Gordon: Yes, I am confident that the chief executive of foundation trusts in Basingstoke will have the skills necessary to carry my services forward. I look forward to handing them over to her in January.

Q90     Mr Bacon: What are you going to do?

  Dr Gordon: That is a story yet to be told.

Q91     Mr Bacon: Will you come back and tell us?

  Dr Gordon: I would love to.

  Chair: Thank you very much, including for being very concise. We now have to move on.

previous page contents next page

© Parliamentary copyright 2011
Prepared 15 December 2011