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House of Lords

Tuesday, 24 April 2007.

The House met at half-past two: the LORD SPEAKER on the Woolsack.

Prayers—Read by the Lord Bishop of St. Albans.

Introduction: Baroness Coussins

Baroness Coussins—Jean Elizabeth Coussins, having been created Baroness Coussins, of Whitehall Park in the London Borough of Islington, for life—Was, in her robes, introduced between the Baroness O’Neill of Bengarve and the Lord Condon.

Introduction: Baroness Campbell of Surbiton

Baroness Campbell of Surbiton—Dame Jane Susan Campbell, DBE, having been created Baroness Campbell of Surbiton, of Surbiton in the Royal Borough of Kingston-upon-Thames, for life—Was, in her robes, introduced between the Lord Ashley of Stoke and the Baroness Finlay of Llandaff.

Water Supply

2.51 pm

Lord Rosser asked Her Majesty’s Government:

What assessment they have made of the availability of water supplies to meet anticipated demand during the rest of 2007.

The Minister of State, Department for Environment, Food and Rural Affairs (Lord Rooker): My Lords, the period from October 2006 to February 2007 was the wettest since 1914. As a result, most reservoir and groundwater levels are normal for the time of year. Consequently, the outlook for water supply is much improved on recent years.

Lord Rosser: My Lords, I thank my noble friend for his heartening reply. What assumptions does his response contain about levels of rainfall, water consumption and loss of water through leaks in pipes for the remainder of this year? Does he accept, despite last winter, that, since repeated hot, dry summers now appear more likely in the future than compensating repeated cold, wet winters, highlighting the necessity to use water more sparingly should be the theme of sustained publicity at regular intervals throughout the year by the water companies and Government?

Lord Rooker: My Lords, my noble friend’s latter point is absolutely right. Water is a scarce resource. There is a programme of planning for new reservoirs and the possibility of water meters becoming compulsory in water-stress areas. On the plans of the water companies

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on leakage, I understand that most are operating at their economic leakage level except for Thames Water—we all know the disruption its backlog is causing around London, albeit for the right reasons. The Government’s sustainable development programme operates on the basis that government departments will use a lot less water. We are in a healthier position now than at the same time at each of the two previous years.

Baroness Trumpington: My Lords, how can the Government anticipate demand for water when they do not prevent the indiscriminate building of houses in, for example, west Kent or Kennett, near Newmarket? These houses are not even occupied. You do not know what kind of families are going to live in them or what the demand for water will be.

Lord Rooker: My Lords, first, modern houses use a lot less water than traditional houses do; they are designed a lot better. Secondly, the plans, particularly in the Thames Gateway, are such that it is highly likely that an increased number of dwellings there can be built using the same amount of water in total as was used in the past, because they are more efficient in their use of water. I say to the noble Baroness that there is no indiscriminate housebuilding in this country.

Baroness Miller of Chilthorne Domer: My Lords, does the Minister intend to rely mostly on metering in water-scarce areas to reduce consumption? His department’s figures show that consumption has risen in unmetered and metered households in seven out of 10 water company areas.

Lord Rooker: No, my Lords. As I said, a range of factors is involved. Metering is not the answer because there would not be the capacity to install enough meters. That is why it is being looked at in water-stress areas. We know from the past, and particularly from the recent, effective hosepipe bans—there are no restrictions on water use at present anywhere in England or Wales and there are no plans for any—and from appeals to save water, that such measures can cut consumer demand by 5 to 15 per cent.

The position is that the reservoirs are full. Thames Water reservoirs, which supply London, were 95 per cent full at the end of March. We do not want to be overoptimistic about this but the situation is better than it was in the past two years, following two very dry winters. There then followed, as I said, the wettest winter since 1914. It was the right kind of rain—

Noble Lords: Ha!

Lord Rooker: Before anybody says anything, my Lords, it filled the aquifers and the reservoirs.

Lord Dixon-Smith: My Lords, that is all very well, but the Question is essentially about a short-term situation that might arise but which I am sure we all hope will not. Were this summer to be drier than last, the present happy situation might develop and become very difficult. Bearing in mind that we are referring to

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the short term, have the Government given thought to taking additional emergency powers over and above those that already exist in order further to restrict water use in such a situation? That would be helpful if we were in a very bad situation.

Lord Rooker: My Lords, no one says that the situation is perfect. We are subject to the vagaries of the weather, but we have enough water. The 2004-06 period in south-east England was similar in severity to the worst drought of the past 100 years. Drought orders were granted in a few areas to limit or prohibit the non-essential use of water. Only one company—Sutton and East Surrey Water—found it necessary to exercise its powers in the past year, and then not to the full extent possible. One cannot say what will happen this year, but we are confident that with current water supplies we should be okay this summer if the weather is as dry. I do not deny that although reservoirs are full there is still a problem, because if there is no rain there is a problem with crops and so forth. However, the water supply should be okay. The programme of planning for new reservoirs, the water companies’ plans and all the other long-term issues are proceeding as planned.

Lord Pearson of Rannoch: My Lords, is the Minister aware that by 1997 we had spent some £48 billion on three EU water purification directives? Will he bring us up to date on the money that has since been spent on those directives? Does the noble Lord agree that if we had been wiser and had we spent the money on what really mattered—namely, infrastructure and supply—we would not be in the position that we now face, however much rain we occasionally get and whatever the quality of his rain?

Lord Rooker: My Lords, I do not think that anyone can criticise. I have not come armed with all the figures on what we have done with the infrastructure in the past 10 years. Billions of pounds have been spent over and above that previously spent. I will find out what has happened to the money that the noble Lord referred to and I will write to him.

Lord Broers: My Lords, this House’s Select Committee on Science and Technology, in its report on water management published last year, suggested that the standard for leakage should be based not on an economic measure but on an environmental one. We made that recommendation specifically. Will the Minister take it up?

Lord Rooker: My Lords, I am assuming that the Government responded to the noble Lord’s Select Committee within the time limit. That would have stated our position. On the other hand, Ofwat is currently leading a review of the methodology used to determine the economic levels of leakage. The other day, I asked how we know what has leaked and I was told, as the noble Lord will recognise, that it is not a simple matter. I was given two interesting ways in which leakage is measured, but it is probably not appropriate that I give them at the Dispatch Box after seven minutes on the Question.

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Department of Health: Procurement

2.58 pm

Earl Howe asked Her Majesty’s Government:

What account they have taken of whole-life costs of procurement in the Department of Health’s consultation on Arrangements for the remuneration of services relating to appliances under Part IX of the Drug Tariff in the light of the price cuts proposed therein.

The Minister of State, Department of Health (Lord Hunt of Kings Heath): My Lords, the department is reviewing the cost of appliances that are set out in Part IX of the drug tariff. It is also looking at how dispensers are remunerated for related services. It is taking into account the costs and benefits to society as a whole, in particular the ongoing healthcare of patients.

Earl Howe: My Lords, I thank the Minister for that Answer, but he will know that this is a considerable worry to the highly vulnerable men and women—up to 350,000 of them—who are reliant on incontinence and stoma appliances. What is the logic of judging a product purely in terms of its price and imposing price cuts of up to 80 per cent when that product could well represent much better value for money than one that is cheaper? Does the Minister realise that the better-value-for-money products are likely to be withdrawn from the market altogether if these proposals are implemented?

Lord Hunt of Kings Heath: My Lords, the consultation has just concluded. The department will consider the results and will bring forward recommendations in due course. I understand the concerns that have been expressed and can assure the noble Earl that they will be fully taken into account. I say to him that the price mechanism for pharmacy contractors and dispensing contractors is not transparent. There are variations between different classes of contractor, which is the reason for this review. It would be sensible to await the outcome of the review, while taking into account some of the concerns that have been expressed.

Baroness Barker: My Lords, can the Minister confirm that the department is proposing to halt payments for services to urology patients? If it is, why?

Lord Hunt of Kings Heath: My Lords, I say to the noble Baroness that these proposals have been consulted on. The Government are not putting forward any firm conclusions; we are awaiting the results of the consultation. The point of the changes that are being proposed to the remuneration is to create a more level playing field between pharmacy contractors and dispensing appliance contractors, because they are paid very differently at the moment and are offering different levels of service. The proposals are partly about getting greater consistency to encourage competition and the provision of more consistent services. The price proposals try to relate the cost of the appliance to the cost to the contractor.

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Baroness Gardner of Parkes: My Lords, is it not an important issue for people receiving these appliances that they are now delivered to them in their homes? These are sensitive issues. The people are often disabled and unable to go to collect such appliances. If the appliances could not be delivered, people might well have to go into care homes. The firm that is doing the greatest number of these deliveries at the moment is very concerned that those doing much less will be paid much better and it will be priced out of the market. In a health service that is now supposedly operated on payment by results, surely the larger and more efficient supplier should not be dismissed in that way.

Lord Hunt of Kings Heath: My Lords, I agree with the noble Baroness that the concept of payment by results is the right one. The whole purpose of the review and the consultation is to ensure that a proper payments system is put in place that is transparent and fair to the various categories of contractor. As far as home visits are concerned, I agree with the noble Baroness about the importance of that service. However, there is inconsistent provision at the moment, and it is not part of the work that is contracted with the pharmacists. The aim of this review is to encourage all potential contractors to provide those enhanced services. The system of payments is designed to reflect fairly the cost to the contractors. I assure the noble Baroness that we will take those matters into account. The last thing we want to do is to discourage home visits in the way that she suggested.

Baroness Masham of Ilton: My Lords, is the Minister aware of the importance of the home advice service, given that some of these devices are very complex? Some people cannot have latex, of which some of the catheters and things are made. The advice is vital.

Lord Hunt of Kings Heath: Yes, my Lords, I agree with the noble Baroness. I can confirm that part of the service provided by some appliance contractors is specialist nurse visits. I agree with her about their importance. At the moment, there is no specific price for the home visits. The proposals being put forward would set a price for those visits, which could be undertaken either, as now, by the appliance contractors or, in future, by the pharmacy contractors. We have to distinguish between our aim to ensure that services to the public are appropriate and competitive issues between the various players in the market, which is a very different issue.

Lord Roberts of Conwy: My Lords, may I forewarn the Minister that, if the proposals are implemented, there will be a direct threat to the high level of personal services, including home delivery, given by the major contractors? I have personal experience of this problem and I think that the Government very much appreciate a warning in time. In addition to the 350,000 recipients mentioned by my noble friend, I understand that some 6 million people in this country suffer from incontinence of one kind or another.

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Lord Hunt of Kings Heath: My Lords, the figures that I have are 450,000 patients and 4.5 million dispensed items. Clearly, this is an important issue for many people, and I am always happy to accept advice from the noble Lord in view of his distinguished ministerial career. Let me make it absolutely clear that the last thing I want to do is to inhibit the provision of the kind of services that he has described. This is about value for money and ensuring that we move away from the difficult-to-understand financial regime and payments to the various contractors to a transparent system that is based on value and enhancing the service to the public. We should make sure that that happens.

NHS: Education and Training

3.06 pm

Baroness Emerton asked Her Majesty’s Government:

Whether the multi-professional education and training allocation to strategic health authorities for 2007-08, which has been increased by 3.6 per cent, will be protected.

The Minister of State, Department of Health (Lord Hunt of Kings Heath): My Lords, investment in education and training will not be ring-fenced in the 2007-08 financial year. There will be a service-level agreement between the Department of Health and strategic health authorities that will hold strategic health authorities to account. The key aim of the agreement will be to ensure that the funding of training and the commissioning of training places are based on long-term workforce needs.

Baroness Emerton: My Lords, I thank the Minister for that Answer. However, will he reconcile a statement made by the Secretary of State, the right honourable Patricia Hewitt, in an interview this month with the editor of the British Journal of Healthcare Management with regard to the transfer of multi-professional education and training budgets to meet the deficits last year? She said,

“now this is fixed I would not expect the NHS to have to take similar action”,

this year. However, four strategic health authorities have already stated their intent to reserve between 3.7 and 11.8 per cent of their budgets for NHS reserves. How will the strategic health authorities be monitored? How will corrective action be taken to ensure that the right level of places are reserved for students, and that deficits from last year are made good in the light of the right amount of students qualifying in 2010-11?

Lord Hunt of Kings Heath: My Lords, last year was exceptional. The NHS faced a deficit. We required the NHS to turn the situation around. It did that. We expect the final outcome for 2006-07 will be that the health service is not in deficit. That has led to hard decisions having to be made, including on education and training. I assure the noble Baroness that education

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and training remains a priority. The Government have seen a huge increase in the number of training places. Through the service-level agreement, we will ensure that strategic health authorities acknowledge their part in ensuring that a national strategy for workforce planning is furthered and encouraged. But the SHAs have to make their own decisions, balancing workforce needs and the needs of training places, and we will certainly ensure that that happens.

Lord Walton of Detchant: My Lords, does the Minister accept that some years ago it was agreed that the training and education budget in the NHS should be ring-fenced, and indeed that last year it was agreed that the joint funding for Medical Research Council and NHS research and development would also be ring-fenced? However, the budget for education and training in the NHS was raided by the primary care trusts because they were running out of money and, despite the assurances, £93 million was taken off the research budget last year. What action are the Government taking in the light of the agreements, to which the Minister referred, to make certain that these raids, which have had a devastating effect on training, teaching and research, will not be repeated in the future?

Lord Hunt of Kings Heath: My Lords, as I have indicated to the House, last year was an exceptional year. It was absolutely essential that the NHS got out of deficit. It looks as though it has done so, but that led to some very difficult decisions having to be taken. I well take the noble Lord’s argument that we need to ensure long-term sustainable provision, both in R&D and in education and training. I am sure that he will acknowledge that there have been big increases in this Government’s overall support for research and development. As I have said, we have seen considerable increases in the number of training places.

On the question of removing ring-fencing, it must surely make sense for strategic health authorities, which know the needs of the service in a region, and which can work and are working closely with the providers of student places, to have the flexibility to take decisions according to their priorities, with the department maintaining an overview and ensuring that we also have a national strategy in place.

Lord Paul: My Lords, will the Minister say whether there are any plans to transfer these funds to the Higher Education Funding Council for England? I declare an interest as chancellor of the University of Wolverhampton.

Lord Hunt of Kings Heath: My Lords, there are no such plans, but I have met representatives of the universities, and I have encouraged close liaison between the universities and the strategic health authorities to ensure that there is close co-operation and partnership.

Baroness Barker: My Lords, in view of what the Minister has just said, and given the effect of this on academic medicine, does he agree that it may be time to have university representation on the strategic health authorities again?

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