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NHS Hospitals (Private Sector Management)

4. David Taylor (North-West Leicestershire): What representations he has received on his proposals to involve the private sector in the management of NHS hospitals. [34703]

The Secretary of State for Health (Mr. Alan Milburn): I have received a number of representations, and announced earlier this month the establishment of a register of interested organisations and individuals who come from a wide variety of backgrounds and are capable of turning around performance in the small minority of the worst-performing local health services.

David Taylor: Is not the theory that the private sector can successfully manage large acute NHS hospitals utterly perverse? Does my right hon. Friend understand why so

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many Labour Back Benchers are deeply unhappy with his proposal to introduce commercial hit squads as an advance guard for covert privatisation? Does he agree that the real wreckers of the NHS are not the failed administrators but the cynical promoters of the private finance initiative and management madness of the sort announced in the House six weeks ago?

Mr. Milburn: No one on the Government Front Bench thinks that the private sector is a panacea for the problems in the NHS, but we intend to use it when it can bring expertise or resources to help improve services. My hon. Friend will be interested in the announcement that I made in early February about the first wave of so-called franchising. New management will be brought in to help turn around poor performance. I stress again that the people being brought in to help with the small minority of poorly performing trusts have some NHS experience. They have a track record of proven success in delivering improved NHS services.

I urge my hon. Friend to accept that we should not simply close our minds to the idea of harnessing managerial experience—as long as it is good and in keeping with the public service ethos—wherever we can obtain it. We do not have a monopoly of wisdom in the NHS. If we can get good managers from local government, the voluntary sector or even from parts of the private sector, we should use them.

Dr. Evan Harris (Oxford, West and Abingdon): Will the Secretary of State admit that he had no clinical outcome data to justify his labelling the hospitals as failing, and that the hospitals were not failing hospitals but scapegoat hospitals? On the day when the right hon. Gentleman announced the franchise plan, two hospitals that I visited—at Portsmouth, and Ashford and St. Peter's—were told that their performances merited two stars, even on the right hon. Gentleman's flawed performance indicators. Are not the hospitals involved facing problems of capacity owing to the scandal of bed blocking and nurse vacancies, which undermine capacity? Would it not be better for the Secretary of State to take expert advice to tackle the problems of capacity? If the private sector managers were from MFI and were able to bring beds with them they might be able to do some good—they will make no difference otherwise.

Mr. Milburn: The hon. Gentleman's jokes are about as good as his policy—

Dr. Liam Fox (Woodspring): Better.

Mr. Milburn: The hon. Gentleman says they are better. I have two things to say about different performance in the NHS. First, every patient knows that there are some first-class hospitals delivering high-quality services. Often, they stand cheek by jowl with other hospitals that are not capable of delivering the same quality, even though they are dealing with precisely the same problems with the labour market, deprivation, health and capacity. The fundamental difference between such hospitals is management organisation, although culture and attitude sometimes play a part.

If the hon. Member for Oxford, West and Abingdon (Dr. Harris) does not recognise that, he should listen to those Back-Bench Liberal Democrat Members who are

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prepared to listen to that proposition. For example, the hon. Member for Yeovil (Mr. Laws), who is sitting behind the hon. Gentleman, said of his party's policies:

Indeed, the hon. Gentleman went on to say that Liberal policies were alienating key voters. I think that all hon. Members will express some sympathy for that opinion.

Dr. Howard Stoate (Dartford): My right hon. Friend the Secretary of State will be aware that the Darent Valley hospital in my constituency is one of those being franchised out. The interim management led by Sue Jennings are already making an appreciable difference to the way in which the hospital is run, and improvements are noticeable all around. Will my right hon. Friend tell the House how the franchising system is running, and whether he believes that the system will finally bring the problems in the Dartford and Gravesham acute trust to an end? Will we be able to look forward to stability and improving standards in the future?

Mr. Milburn: I am grateful for the support that my hon. Friend has given, in pretty difficult circumstances, to that hospital and to social services in the Dartford and Gravesham area. Some very real problems exist. They are partially problems of capacity and cash, but as my hon. Friend and other clinicians in the local community have recognised, they are also problems of management and organisation. If we can bring in some new blood from elsewhere in the NHS, and use that expertise for the benefit of patients in the area, that would be a sensible thing to do. I hope that the new management team that we will bring in before too long will help to turn around the performance of what has been a difficult hospital to manage. Patients there have not always had the services that they need. My hon. Friend knows as well as I do that good leadership in a hospital, just like good leadership in a school, is crucial to that hospital or school's success. I hope that by bringing in some new leadership, we can make a difference.

Mr. Peter Lilley (Hitchin and Harpenden): Is the Secretary of State aware that people in my constituency do not care whether managers are private sector or public sector managers so long as they are competent? We are relieved and grateful that his Minister overruled the decision of local managers to close the maternity and children's units at Hemel Hempstead general hospital and decided to try and keep them open. However, is not that decision a vote of no confidence, echoing the vote of no confidence in local management by all parties on St. Albans district council? Local managers have made it more difficult to keep those units alive by their decision to announce a closure, leading to the resignation of large numbers of staff and the biggest nurse shortages in any county in the country.

Mr. Milburn: I shall certainly not stand here and condemn local management out of hand when I do not know the facts. I shall be very happy to look into the right hon. Gentleman's allegations. However, managing any public service, particularly the national health service,

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is not an easy job. It is pretty difficult. It would be helpful if Conservative Members got behind some of our people rather than always running them down.

Mr. Tony McWalter (Hemel Hempstead): Further to that question, will my right hon. Friend accept my congratulations on the tremendous work done by his colleague Lord Hunt for the Hemel Hempstead hospital and the special care baby unit in using the hospital to set up a pilot scheme looking at a national framework for neonatal services? Many of the local health service managers performed outstandingly well when it came to supporting Lord Hunt and arriving at that excellent decision.

Mr. Milburn: I can only agree with my hon. Friend. It is often difficult when changes are proposed in local health services. I know that my hon. Friend has been concerned about the local situation; he has been to see me about it as well as my noble Friend Lord Hunt. I hope that the solution that we have come up with will be good for staff in the local hospitals as well as the patients who use the services.

Bed Blocking

5. Mr. David Ruffley (Bury St. Edmunds): What his policy is towards tackling bed blocking. [34704]

The Secretary of State for Health (Mr. Alan Milburn): Our policy is to reduce bed blocking through additional investment and reforms to the way in which the national health service and social services work together.

Mr. Ruffley: I thank the Secretary of State for that reply. He will be aware that the bed blocking figures for my county are the sixth worst in the country. Given the right hon. Gentleman's personal commitment to private enterprise and the private sector, will he investigate Suffolk social services' abysmal record in encouraging the expansion of private sector residential home care places?

Mr. Milburn: I will gladly look into the point about Suffolk county council. The hon. Gentleman is right that there is a particular problem in Suffolk with regard to care home or home capacity. I am aware of that. For that reason, the Government have made available additional resources above and beyond the resources made available to other comparable councils. Suffolk is receiving an extra £5 million in this financial year and the next financial year to stabilise the situation, presumably by first raising care home fees and then by investing in new capacity, presumably in the private voluntary sector as well as in the public sector, through intermediate care, rehabilitation services and all the other services that I hope the hon. Gentleman supports. That is the right thing to do first of all.

I understand from the figures that I have received that these measures are already bearing fruit. There has been a 30 per cent. reduction in delayed discharge problems in the hon. Gentleman's area since the additional money was made available. That, with respect, is what happens when

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additional money is put in. The question for the hon. Gentleman is whether his party would be prepared to match it.

Ms Julia Drown (South Swindon): I welcome the £800,000 that the Government have given my constituency this financial year and the next to help with the problem of delayed discharges. That money is helping, but we still have far too many people waiting to be discharged from Princess Margaret hospital. I hope that my right hon. Friend welcomes last week's decision by Swindon borough councillors to restore proposed cuts in social services budgets, which would have reinforced the problem. I should be grateful if he would look at the situation. Social services have made it clear to me that we need more funds if we are to develop the specialist domiciliary services that are necessary to get more people out of hospital and into their homes, which is where they want to be.

Mr. Milburn: As my hon. Friend knows—I visited her just a few months ago to talk about precisely such issues—I am aware of some of the problems in Swindon. In Swindon as elsewhere, we need to do three things. First, it is true that there is a problem with the level of funding received by many social services departments, not just for the care of the elderly but for the care of vulnerable children. Budgets are rising very fast, but resources have not always matched them. I am seized of that problem.

Secondly, as the hon. Member for Bury St. Edmunds (Mr. Ruffley) rightly pointed out, there are capacity problems in some parts of the country as a consequence of changes in the residential and nursing home market. We have to do something to stabilise the market and ensure that it can grow again, including offering alternative forms of provision, and more home-based and intermediate care.

Thirdly, in my view we must reform the relationship between health and social services. We cannot have a stand-off between them. Health and social services are two sides of the same coin. They rely on each other and the patient relies on both, and we need closer, rather than more distant, working relations between them.

Mr. Archie Norman (Tunbridge Wells): Given the Secretary of State's previous answer, does he accept that the time has come for a fundamental review of the funding of nursing care and the relationship between the two Departments? It is the NHS that is carrying the inevitable burden of an inadequate and inequitable system of nursing care funding that is producing perverse results such as that in west Kent. The Kent and Sussex hospital is making available extra beds and recovery wards just to hold the extra patients who cannot be released, but at the same time the number of nursing care beds in west Kent has declined by 17 per cent. in the past two years. Moreover, nursing care funding in Kent per elderly patient is a third of that received in other parts of the country such as London.

Mr. Milburn: As I said to my hon. Friend the Member for South Swindon (Ms Drown) and to the hon. Member for Bury St. Edmunds, there is undoubtedly a capacity problem in the south—although the problem is not peculiar to the south—and we have to deal with it.

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Nursing home fees and fees paid by local authorities to care homes have not risen markedly for years. As a consequence, many owners of residential and nursing homes have decided to get out of the business. We must stabilise that situation, but we must do so through more investment. The issue for the hon. Member for Tunbridge Wells (Mr. Norman) and his party is whether they are prepared to match the resources that we have put into extra social services funding. The hon. Member for Woodspring (Dr. Fox) could stand at the Dispatch Box and agree with us that extra money is going into social services and that more is still needed.

Syd Rapson (Portsmouth, North): Will the Secretary of State or one of his Ministers visit Portsmouth in the near future to see a good example of a working partnership between social services and the health authority, which has reduced deferred releases considerably? The money provided was very welcome, but a visit from the Secretary of State or a Minister would be a morale booster at a time of change.

Mr. Milburn: You see—such visits are a morale booster. [Interruption.] The hon. Member for Woodspring is not convinced, but the Under-Secretary, my hon. Friend the Member for Salford (Ms Blears), who boosts morale wherever she goes, will visit that constituency. [Hon. Members: "Hear, hear.] On that point, at least, the cross-party consensus on health is alive and well.

The level of delayed hospital discharges is a very serious problem in the Portsmouth area and across the country, but it is worth getting it in perspective. At the end of December last year, about 5,100 patients aged over 75 had their discharge delayed. That is far too many, and it is clear that we need to deal with the problem, but the numbers are falling. In the comparable period of the previous year, some 5,800 patients had their discharge delayed, but in December 1996 the number was 20 per cent. higher. The extra investment and some of the changes are beginning to bite, and we need to do more of that.

Dr. Liam Fox (Woodspring): Does the Secretary of State accept that there is a clear relationship between the loss of care home beds, bed blocking in NHS hospitals and the increase in cancelled operations? Who is responsible for the current situation?

Mr. Milburn: Of course there is a relationship between the capacity available outside and inside the hospital. That is absolutely true. I note with interest, however, figures from the premier market analysts, Laing and Buisson, on the care home market. Those figures confirm, first, that there has been an overall loss in care home capacity of approximately 19,000 places; and, secondly, that demand and supply are more or less in equilibrium in many parts of the country. That is not of course the case in all parts of the country, and we have made extra resources available where it is not so. If the hon. Gentleman and his party are so concerned, the question is whether they are prepared to put their money where their mouth is and match the record extra resources—

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Mr. Speaker: Order. The Minister should not ask the Opposition spokesman questions. Questions are put to the Minister for answer.

Dr. Fox: I am grateful to the Secretary of State for admitting the relationship, but I wonder whether it has come to him as a recent revelation. Why did the Government not do something about it earlier? More than two years ago, on Second Reading of the Care Standards Bill, we predicted exactly what would happen as a result of Government policy. We said that tens of thousands of care home beds would be lost with increased misery for elderly patients, more blocked beds, more cancelled operations and more patients waiting in casualty to be admitted to hospital. Will the Secretary of State apologise for his negligence and incompetence and for the fact that patients have to queue not just to get into hospital but to get out again?

Mr. Milburn: It is interesting that the hon. Gentleman, who is so fixated about care home beds, did not say a word about NHS beds. There is a simple reason for that: when his party was in office, the number of beds in hospitals fell by 60,000. Under the Government, the figure is rising again.

Dr. Fox: That was a pretty disappointing answer, even by the Secretary of State's standards. Under Labour's stewardship, the number of NHS beds has fallen below the number of administrators for the first time in the history of the national health service, and that tells us all that we need to know about the Government's centralising tendencies. It is typical of the Secretary of State to hide behind a few figures. Under the present Government, we have seen the fiddling of waiting list figures and cancelled operation figures. We have seen the Government fixing accident and emergency times to make themselves look better. They have even taken wheels off trolleys so that they could call them beds and slapped themselves on the back for it. Does not all that simply show that the Government draw no distinction between truth and untruth, merely between convenience and inconvenience.

Mr. Milburn: There is a fundamental question for our health and social services. We recognise that there is a big problem, which has been caused by decades of neglect and under-investment. The choice for the country is straightforward: are we prepared to invest more money—to put our money where our mouths are—to deal with the evident problems? We say that there is no such thing as a free lunch. If we want world-class health care, we have to invest and we have to pay for it. That is precisely what we are doing and what we are committed to doing. The issue facing the hon. Gentleman is whether he is prepared to match our spending, and the answer is a decisive no.

Dr. Nick Palmer (Broxtowe): Does my right hon. Friend accept that things are not quite as simple as we tend to imagine. We tend to assume that people are either in hospital or in care homes. In fact, however, Nottingham Healthcare NHS trust tells me that the number of patients waiting to go into care homes has reduced greatly as a result of the Government's provision of money, but that there is a problem with intermediate beds for their transfer to acute care. Will my right hon. Friend address that problem as he funds the health service in coming years?

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Mr. Milburn: My hon. Friend makes an extremely important point: we face not only the problem that, when people are ready for discharge from hospital we are sometimes unable to discharge them, but the fact that many people need not end up in hospital at all. Provided that decent primary and community services are in place, we can offer more appropriate care, closer to home, for many elderly and disabled people.

My hon. Friend asks about the provision of intermediate care services—often an important missing element in the range of services available in many local communities. There is genuinely good news on that. We expected to see about 1,000 extra intermediate care beds by March this year. That is well on target; indeed, it is ahead of target and I expect there to be about 2,000 extra intermediate care beds by March this year. That does not solve every problem, but it means that we are setting up more appropriate care for many people who would prefer not to be in hospital in the first place.

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