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Lord Falconer of Thoroton: My Lords, sometimes analysis will be opinion and sometimes analysis will be fact. If we take, for example, a statistical table and say, "Well, these statistics show that 20 people went to Brighton during the year 1996, and we think that this suggests that very few people will go to that town in the next few years", which is fact and which is fiction? Both are an analysis from preceding fact, but which is a fact and which is an opinion? It is quite difficult to answer that question because it is a grey area.

Lord Lucas: My Lords, I am immensely grateful to the noble and learned Lord for the trouble that he has taken to deal with this group of amendments. As has been said, my amendment is the least important of them, but it seems to me that this is an extremely crucial part of the Bill. We are looking at the part of the Bill that will determine in the future whether the public have access to enough information to ensure that they have a real appreciation of what lies behind decisions that the Government are making and a real opportunity to contribute to such decisions.

When I look back at the history of the BSE crisis, it seems to me that it was the lack of that contribution to government decisions that made the crucial difference and enabled the Government to make the errors that occurred. If members of the public had fully

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appreciated the risks that the Government were taking with their health, they would not have allowed them to pursue the course that they took. That is my clear view of what happened in the BSE crisis. Indeed, it is my clear view of what has happened with the recent rail disaster and the reaction to it. The public have been let in on that decision, and because it was clear that the facts would be made available to members of the public, Railtrack took the decision that safety must be absolutely paramount and that it must now face the financial consequences of repairing track.

The latter seems to me to be a pretty good analogy with what happened in the BSE crisis. During that time, we allowed the epidemic to trundle on to see where it would lead, even though there were, from the beginning, quite clearly very substantial risks that it would turn out to be a hazard to human health, as well the very substantial risk that the measures taken by the Government would not be sufficient to curb the epidemic. The difference between the two is that the public have been let in on the act, so to speak, and allowed to express their opinion in one case, but were not allowed to do so in the other. As a result of this legislation, it must be made absolutely certain that the public will be allowed access to enough information so that their reaction to it forms part of the decision-making process of government.

I have listened very carefully to what noble Lords have said about Amendments Nos. 42 and 43. My opinion, along with my noble friend Lord Mackay of Ardbrecknish, is that Amendment No. 42 is the better amendment. It is obviously not in my hands to decide whether that amendment will be pressed today. However, if it is, I shall certainly support it. I beg leave to withdraw my amendment.

Amendment, by leave, withdrawn.

Lord Burlison: My Lords, before we move on to deal with the Statement on resources and priorities for the National Health Service, I should like to take this opportunity to remind the House that the Companion indicates that discussion on a Statement should be confined to brief comments and questions for clarification. Peers who speak at length do so at the expense of other noble Lords.

NHS Resources and Priorities

4.34 p.m.

The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath): My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State for Health. The Statement is as follows:

    "With permission, Mr Speaker, I wish to make a Statement about the resources being made available to local health services in all parts of England and the priorities for reform in the NHS.

    "In the past three years the NHS has treated 2.3 million more patients. It now employs 10,000 more nurses and over 5,000 more doctors. Waiting

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    lists for in-patient treatment have fallen by 126,000. For the first time since records began, the numbers of patients waiting for out-patient appointments and in-patient treatments are falling simultaneously. Every A&E that needs it and 1,000 GP surgeries are being modernised. The biggest hospital building programme in the history of the NHS is under way.

    "After decades of neglect, the NHS is now expanding its services to patients. For two decades or more the NHS budget rose by an average of just 3 per cent a year. In the last Parliament it rose by less than that--just 2.6 per cent. In this Government's first two years in office spending on the NHS did not rise as quickly as many had hoped. But the tough choices that we took then are paying off for the NHS now. Interest rates and inflation are at historic lows. Unemployment is down, employment is up. The public finances are back in balance. A strong and growing economy is now providing the foundation for strong and growing public services.

    "Over the five years from 1999 the NHS budget will grow by one-half in cash terms and by one-third in real terms. This year and for the next three years the real-terms annual increase in NHS funding will be 6.3 per cent--twice the trend growth of the past few decades.

    "Today I can inform the House of the funding allocations for each health authority in England. The cash is for revenue purposes. I shall be making announcements in due course about capital resources. Details of today's allocations for the local health authorities in right honourable and honourable Members' constituencies are available in the Vote Office. I have also written today to all Members of this House with details.

    "For the first time in the history of the NHS, I am today making outline revenue allocations for the next three years rather than just for a single year ahead. This will allow every local health service to plan with confidence for the medium term rather than just for the short term. As right honourable and honourable Members are aware, there has been too much boom and bust in NHS funding in the past. Today we bring that to an end.

    "From April next year health authorities will receive an average cash increase of 8.5 per cent. No health authority will receive less than 7.8 per cent. The average rise in cash terms for a health authority next year will be £29 million.

    "I can also announce today that every health authority will benefit from a further rise of at least 6 per cent in 2002-03 and a further increase of at least 6 per cent in 2003-04. These increases are the minimum that all health authorities can expect to receive, with final allocations to be made in the autumn of next year and the year after.

    "I know that the House will want to compare the increase in investment for next year and the following years with previous years' allocations. For the benefit of right honourable and honourable Members on both sides of the House perhaps I may

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    tell the House that in the last year of the last Parliament the NHS budget actually fell in real terms.

    "I am pleased to tell the House that after years of under-investment the NHS is now growing again. Different parts of the country of course have different health needs. The Government are currently reviewing the formula by which we distribute NHS cash to ensure that it is better focused on addressing those needs properly and fairly. In the meantime for next year I have a number of important changes.

    "First, I am more than doubling, to £130 million, the resources available within health authority allocations to help address some of the appalling health inequalities that scar our nation. Life expectancy for a baby boy born in Manchester is 6.5 years less than that for a baby born in East Surrey. The existing funding formula does not take full account of the excess morbidity and mortality from cancer, coronary heart disease and other causes in these areas expressed through rates of years of lost life. The extra funding will help places in the North and the Midlands, such as Bury and Rochdale, Calderdale and Kirklees, Dudley, Leeds, Leicestershire, Manchester, Newcastle, Nottingham, Tees and Wakefield, as well as areas in the South such as Bedfordshire, Brent, Cornwall, East Kent, Herefordshire, Lambeth and south and west Devon. These extra resources will help to narrow the health gap between the better off and the worst off.

    "Secondly, I am making available a further £65 million to pay a new cost of living supplement for 100,000 qualified nurses, midwives, health visitors and professions allied to medicine such as physiotherapists and radiographers working in the highest cost parts of England. From next April there will be a minimum of £600 extra for every one of these staff working in London, over and above the current London weighting, and up to £1,000 for ward sisters and senior nurses in the capital. Staff in these groups working in the highest cost areas outside the capital such as Avon, Bucks, Cambridgeshire, Oxfordshire, Surrey and Wiltshire will also receive between £400 and £600 each. These extra resources will help in our efforts to recruit an extra 20,000 nurses and 6,500 therapists to the NHS over the next four years.

    "There is a further major change I am making to the way the local health service is funded. In the past there have been too few means to drive up performance and to tackle unacceptable variations between local health services. If the NHS is to make progress, it has to move from a culture where it bails out failure to one where it rewards success. The best NHS organisations should have more freedom and more resources to expand their services to more patients. The worst should have more help to enable them to improve. For next year I am making available a new £100 million performance fund to provide a clear financial incentive to all parts of the NHS to improve local services. The fund will rise to

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    £500 million by 2003-04. The best local services will be free to spend their share of the fund on equipment, facilities or cash bonuses for staff. The worst will still get a fair share of the fund but it will be held by the new Modernisation Agency to use for targeted external assistance to help turn round performance. We will no longer tolerate second-rate services in any part of the NHS. The lottery in patient care must come to an end.

    "The extra investment we are making will bring about the major reforms the NHS needs. At present services are too slow, standards are too variable, staff are too often run off their feet. In July the Government published the NHS Plan, written in consultation with NHS staff and with NHS patients. The plan describes the radical reforms that are necessary to redesign the service around the needs of its patients.

    "The money I am allocating today will up the pace of implementation. Next month I will publish a detailed NHS Plan implementation programme for the health service and for social services. It will detail the investment and the progress that will need to be made over the next year, for example, in improvements in hospital standards, in services for elderly people, children in care and patients with mental illness.

    "The next year will see a major expansion in staff, beds and services. Improved co-operation between health and social services, for example, will deliver more packages of intermediate care support benefiting 60,000 elderly people so that in every council area more older people can live independently at home. The result will be lower rates of delayed discharges from hospitals in all parts of the country.

    "Crucially the level of resources now available to the health service allows a proper focus on how we can bring about improvements in health, not just an increase in the scale of investment in health services.

    "So these allocations to health authorities will fund a further £450 million to help tackle our country's biggest killers--cancer and coronary heart disease. Our rates of both diseases are too high. Both diseases are largely preventable. The extra resources will mean more drugs to combat cancer and heart disease, more help for people to give up smoking--a major cause of cancer and heart disease--and more operations provided more quickly for more people with cancer and heart disease. By December next year, for example, there will be a new maximum one-month wait from urgent GP referral to treatment for men with testicular cancer, for children with cancer and for patients of all ages with acute leukaemia. Similarly, by March 2002 three in four eligible patients will receive life-saving clot-busting drugs--thrombolysis--within 30 minutes. At present many people wait twice as long.

    "Waiting is the public's number one concern about the health service. That is why the Government have placed such a strong emphasis on

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    winning the war on waiting in the NHS. The NHS Plan set out how by 2005 waiting times for seeing a GP will have fallen to 48 hours; to be seen in A&E to an average of 75 minutes; for an outpatient's appointment to a maximum of three months; and for inpatient treatment to a maximum of six months. By 2008 there will be waits for hospital treatment of weeks not months.

    "In the next year the investment we are making will deliver real progress towards these shorter waiting times. At present, for example, 126,000 patients are waiting over 26 weeks for an outpatient appointment. By March 2002 no one should be waiting that long and the number of people waiting for 13 weeks will have been reduced too. Similarly, the maximum waiting time for inpatient treatment is currently 18 months. We estimate that about 50,000 people wait between 12 and 18 months. By spring 2002 the NHS will have reduced the numbers waiting over 12 months and the maximum waiting time will have been reduced from 18 to 15 months for all patients. Of course I recognise that these new maximum waiting times are still too long but they represent the first instalment of real progress towards the NHS Plan objectives. Step by step over the next few years the NHS will become faster and more convenient for patients.

    "The NHS is in a position to deliver substantial improvements for patients because of the commitments the Government have made to it. While some in this House say they have philosophically moved on from the NHS, this Government are committed to the NHS, to its survival and to its modernisation. We have made our choice. Our choice is for an NHS providing care according to need, not ability to pay. Our choice is for a tax-funded health service available to all, not a privatised system of care available only to a few. Our choice is for long-term investment in our key public services, not half-baked arbitrary tax cuts. It is for record levels of investment alongside a radical programme of reform.

    "The step change in the resources we have made available to the NHS must now produce a step change in results. None of it will be easy. Much of it will take time. But the NHS now has the best opportunity it has ever had to bring about the radical changes needed to give patients better and faster services. The resources I have committed today will bring about improvements in health and healthcare in all parts of the country. I commend them to the House." My Lords, that concludes the Statement.

4.47 p.m.

Earl Howe: My Lords, I begin by thanking the Minister for repeating the Statement which contains much that we can welcome. The sums of money that the Government have allocated to the NHS over the next three years are significant by any standards. We need to be clear that large parts of today's announcement represent allocations of part of the

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increased money for the NHS announced in the Budget settlement earlier in the year. Therefore, my welcome today is in part a repeat of the welcome given by the Opposition to that announcement some three months ago.

I am sure it is right nevertheless that we should be presented today with a greater measure of detail than was available in the summer. I particularly welcome the fact that a significant portion of the enlarged budget should be directed towards the drive to eliminate regional health inequalities, to help with nursing accommodation and to eliminate two of the most important of the country's killer diseases.

But the benchmark of success for the Government's good intentions will be the manner in which the money is spent and the health gains thereby achieved. I have several questions for the Minister. The Statement mentions that the real-terms increase in spending over the three years will be 6.3 per cent per annum. It also states that every health authority will benefit from a rise of at least 6 per cent in 2002-03 and a further increase of at least 6 per cent in the following year. Can the Minister confirm that the 6 per cent increases for health authorities in those two latter years represent cash increases and that health authorities can, therefore, expect to receive real-terms increases of some 3.5 per cent? Perhaps the Minister will tell me if I have misunderstood that part of the Statement. If it is only a 3.5 per cent real-terms increase, we have to be clear that, welcome as it is, it will do only a limited amount to address what is now a steeply rising curve in the healthcare inflation rate.

Perhaps I may also ask the Minister about the expansion in the number of beds. The beds to which he appears to refer in the Statement are beds in intermediate care. These are not hospital beds but beds which already exist in the private residential care and nursing home sectors. In that context, does the noble Lord share my worry? As I predicted when we debated the Care Standards Bill, we are now seeing a serious contraction of the private home sector as a direct consequence of two factors: first, the inadequate fee rates paid by local authorities; and, secondly, the blight caused by the uncertainty surrounding the Government's minimum standards legislation for care homes which we have still to see. What reassurance can the Minister give today to the care home sector that not only is it needed and wanted but also it will be properly and fairly remunerated for the work it does?

I turn to waiting times. Ministers have consistently adopted the public position that as waiting lists are reduced, so waiting times are reduced. I question, not for the first time, the logic and accuracy of that assertion. It is particularly noticeable that in the most recent set of waiting list figures the number of patients waiting over a year has increased from just over 30,000 in March 1997 to over 50,000 in September 2000. The number of patients waiting more than 26 weeks for an out-patient consultation has increased from 71,000 to 125,00 in the same period. There is an increase of 187,000 for those waiting more than 13 weeks for an out-patient appointment. The headline numbers of patients are coming down but many patients are

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waiting longer. Therefore, what change has there been since the Government came to office in the average in-patient and out-patient waiting times? Those figures seem to be better indicators than most of what real patients currently experience.

The key problem with waiting times, and specifically the pledges set out in the NHS Plan is the shortage of specialists to treat patients. The target, for example, of achieving by 2002 a maximum two-month wait from an urgent GP referral for suspected breast cancer to treatment of the breast cancer is regarded by many as unattainable because there will not be enough oncologists, radiologists, histopathologists and so on to ensure a swift enough diagnosis on referral. The year 2002 is not a long time away. I put this point to the Minister last week. I am not sure that he gave me a full reply. Perhaps he could do so now.

Finally, I turn to the funding announced for drug treatments. The additional sums to which the Statement refers are welcome although I noted with some surprise that both coronary disease and cancer are "largely preventable". That, I think, will be news to many. However, that is not my point. I refer to the role of NICE. By directing money specifically to cancer and heart diseases, the Government appear to be sending a strong signal to the National Institute for Clinical Excellence that one of the main criteria under which NICE operates--namely, the need to assess the effective use of available NHS resources--is, for practical purposes, redundant in those key areas. In that sense, the new funding distorts the remit of NICE. Drugs to treat cancer and heart disease are not to be assessed on a par with, let us say, drugs for diabetes, arthritis or Alzheimer's. In other words, the extra money looks as though it will serve to favour and prioritise cancer and heart drugs over other kinds of drug treatment even before NICE has considered those drugs in terms of their clinical and cost effectiveness. Indeed, why confer on NICE a duty to consider the wider affordability of drug treatments if at the same time you make such judgment redundant for certain classes of drugs?

I stress that I do not belittle the new funding for drug treatments. But perhaps I may ask the Minister whether, and on what basis, he is confident that this funding will serve to eliminate postcode inequalities in the prescribing of major heart and cancer treatments. Can he reassure us that the channelling of new money to help authorities will guarantee the availability of up-to-date drug treatments? It would be possible for me to ask many more questions of the Minister arising out of this wide-ranging and important Statement. However, in deference to the House I shall desist. I look forward to the Minister's response.

4.57 p.m.

Lord Clement-Jones: My Lords, I, too, thank the Minister for repeating the Statement in this House. I share the views of the noble Earl, Lord Howe, that it is an important Statement. One would wish to ask many questions, particularly with somewhat longer notice than was available. This is a complex Statement

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potentially and a number of issues underlie what appear on the surface to be straightforward propositions.

On these Benches we have never made any pretence of doing other than welcoming the increased funding which was announced earlier in the year, or the essentials of the NHS Plan which are designed to spend the increased funding. We welcome many elements of the Minister's Statement: in particular, the fact that it is now possible to announce a three-year funding settlement; the fact that the settlement is directed towards resolving health inequalities; and the funding for cancer and heart disease which are at the top of the priorities for the Government and for all of us.

I share the noble Earl's views that it is essentially a Statement of allocation. This is not new money. It is the Government telling us in greater detail than was available earlier in the year how the money is to be spent. On these Benches, we also welcome the cost-of-living supplements for nurses and those in allied professions in London, the Home Counties and the South West, and the announcement of the NHS implementation plan. But Ministers should not over-egg the pudding. There are question marks about the performance to date of the NHS. There was a congratulatory tone about the Minister's Statement which many of us felt was inappropriate in the circumstances. Effectively, we are talking about a statement of what is planned to be spent, not patting ourselves on the back on what has been achieved to date.

The Healthcare Navigator figures reported today--I should like to hear today why the Government dispute them--put in question Ministers' claims on waiting time performance, particularly in the South East. The personal experience of many in this House indicates that those figures ring truer than many of the statements made by the Government.

So there are a number of questions over the Government's Statement today, about the figures they have quoted and their allocation. I wonder how the Government can be quite so specific today: they have made very clear statements about percentage rises, but we do not yet know what the pay settlements will be. At the moment we do not know what the pay settlements for doctors and nurses will be, and, after all, pay accounts for 70 per cent of NHS costs and normally settlements are not agreed until Janauary or February. Can the Minister confirm that health authorities will have certainty earlier than usual? Will those pay settlements be agreed in the next few weeks?

It is also important to know just how much money the NHS is retaining at the centre. We have seen a pattern over the last few years where, by means of modernisation funds and other funds, the full amount of the allocation is not made available to health authorities. Strings are attached to a number of different forms of expenditure. The Government, by announcing their implementation fund, have done almost exactly the same thing this year. It would be helpful if the Minister could say exactly what is being retained at the centre and what will suddenly be

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announced later this year as part of a new initiative which is no doubt already planned. It would also be helpful to know what precisely is ring-fenced by health authorities. Quite often we hear announcements of additional funding for, say, dentistry, but is it really additional funding? Indeed, is it ring-fenced? Are health authorities obliged to spend the money? None of this is entirely clear.

The noble Earl, Lord Howe, referred to NICE making decisions over a huge number of treatments over the course of the year, whether through the guidelines for which it is responsible or through its appraisals. As your Lordships know, a number of appraisals are eagerly awaited, not least the appeal process on Beta Interferon which is in train at this moment. Will the funding be there? Has the calculation been made about the anticipated cost of those treatments and their implications for health authorities? I am sure that health authorities would like to know.

We congratulate the Government on the fact that drugs like Taxol and Taxotere have been funded by health authorities. Will health authorities be able to continue with such funding? There is little time in which to raise other topics, such as intermediate care. Will that be health authority funded or social services funded? The Government have pledged to pay for nursing care by October 2001. Will that be done through health authorities or social services? What will be the deficits of health authorities by this year-end?

The Statement raises a huge number of questions. It has come at very short notice and at the end of the day the important question is: will authorities have the capacity to spend the money which has been allocated to them? Capacity is at the core of the NHS. We know there will be a winter crisis this year. Will there be crises in winters to come?

5 p.m.

Lord Hunt of Kings Heath: My Lords, I will try to reply to the points that have been raised in the limited time allowed. I am grateful for the overall welcome given to the Statement by the noble Earl, Lord Howe, and for his acknowledgment of the significant sums being made available; also significant is the announcement of the three-year allocations. These are in response to requests made by health authorities over many years for more certainty in their future planning. I am sure that they will be warmly welcomed.

The noble Earl is right about the 6 per cent being a cash figure, but that is a minimum figure and many health authorities will receive considerably more than that figure within an overall context of a 6.3 per cent real growth over the four years. I am sure he would accept that in any resource allocation situation there will always be some authorities which receive more than others, in accordance with the criteria set out in the allocation formula.

I was asked about bed capacity. We estimate that by December we will have in operation 123,800 general acute beds, which is an increase of nearly 3,500 over 12 months ago. Similarly, 13,600 intermediate beds

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will be in operation: that again is an increase of 3,100 over the corresponding period last year. I would also inform the House that yesterday the Government announced the go-ahead for 18 new hospital schemes throughout the country in the next two years, worth in total over £2.3 billion. That will enable us to see a further expansion in overall bed numbers. Also, as part of our winter preparations we expect to have an additional 300 critical care beds over the corresponding number last year. That should be extremely helpful in meeting the expected winter pressures.

The noble Earl asked a number of questions in relation to residential care homes. He will know that we believe the Care Standards Act, as it now is, will help to improve quality in the provision of those homes, as we would all wish. I would also say that despite regional variations there is still excess capacity in the residential care and nursing home sector. Also, where there have been falls in nursing home places, these have been more than offset by an estimated 20,000 rise in the number of people helped to live at home. Of course, the whole development of intermediate care and of support within the community is intended to balance any changes that may take place in the overall nursing home market.

The noble Earl also asked about waiting times and waiting lists. He will know that we have succeeded in reducing the number on the waiting list by 126,000 below the figure that we inherited. That has a beneficial impact on waiting times as a whole. The current position is that 76 per cent of patients are seen within 13 weeks and 94 per cent of patients are seen within 26 weeks of referral by their GP. Also, the number of people waiting more than 12 months is one-third lower than at June 1998. The average waiting time for patients on the list is 13 weeks: two weeks less than at June 1998.

A number of questions were asked about NICE. I do not believe that the criteria set out for NICE are redundant. NICE will continue as in the past in making its recommendations. On funding, we believe that we are right to expect the health service to fund the drugs and other treatments recommended by NICE, on the basis of the overall allocation given to the NHS, which is the most generous allocation in its entire history.

The noble Lord, Lord Clement-Jones, asked about the statement made by Healthcare Navigator about waiting times. This company aims to help people to get private sector health care. Last August it ran a similar story and published similar figures, which were wrongly worked out. We believe them to be entirely guess-work, speculative and based on unsound mathematics.

Regarding central budgets, £5.9 billion is being held centrally, but much of it is for funding national programmes for education and training, research and development. We shall make announcements about that in due course. We are trying to push as much money as possible out to the health service so that health authorities can decide in their own way how to spend it.

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Finally, I thank the noble Lord for his acknowledgement of the extra resources for dentistry.

5.10 p.m.

Lord Prior: My Lords, the Minister will know that we on these Benches welcome much of what he has said, although the drafting of the Statement makes one believe that a general election is not too far ahead.

When a government decide to put a lot of extra money into a particular resource at once, there is a tremendous danger that the management will not be able to cope. That can result in a lot of money being wasted, particularly when plans had originally been drawn up on the basis of a stringent settlement and the management then suddenly find that a lot of extra money is available. Will the Minister say a little more about the management of the National Health Service? Is the Treasury satisfied that the extra resources can be properly utilised?

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