Select Committee on Health Minutes of Evidence

Examination of Witnesses (Questions 964 - 979)




  964. Can I bid Members welcome and as it is the first meeting of the New Year wish everybody a Happy New Year and include the Government in that.
  (Mr Milburn) That is very generous, Chairman.

  965. Can I thank you, Secretary of State, for coming once again and thank your officials particularly for the additional memorandum that was sent on to us subsequent to your last appearance. Could I ask you each briefly to introduce yourselves to the Committee before we commence.
  (Mr Milburn) Alan Milburn, Secretary of State for Health.
  (Mr Coates) Peter Coates, Head of Private Finance in the Department of Health.
  (Mr Foster) Andrew Foster, Director of Human Resources, Department of Health.

  (Mr McKeon) Andrew McKeon, Head of the Private Sector Projects Team.
  (Mr Macpherson) Nick Macpherson, Managing Director of Public Services, HM Treasury.

  966. Can I begin by one or two points on the issue of the Concordat. Obviously this inquiry covers a number of areas, including the Concordat. Secretary of State, you will remember when we met last time I asked you a number of questions about the issue of the use of the consultant workforce and raised some concerns about my worry over the conflict between the work in the private sector and within the NHS. Some of your answers related to the issue of the need for private sector capacity. Can I be explicit. Obviously I am concerned at this point with the consultant workforce as opposed to the issue of capacity, operating theatres or whatever. You were reminded of the fact when we met last time when we undertook our inquiry into NHS consultants' contracts we had some evidence suggesting a correlation between lengthy waiting lists and private practice in some areas. I do not know whether you have had the opportunity to look at the evidence we received shortly before Christmas from a witness by the name of Karen Bryson, who is the Director of Cancer Services Collaborative for the South East Region Regional Office. If I can quote it. I was interested in what she had to say. In talking about the Concordat she talked about the fact that they had, and I quote, "...encountered difficulties with consultants and some blockages to transferring these patients into the private sector, to quote some of them, because it would affect their private list." She went on to say "Some were particularly obstructive with it and we had quite a lot of difficulty circumventing that". My comment was "You were saying there was some obstruction by NHS consultants about moving people from their waiting list into the private sector because that would impact upon their private lists?" and Ms Bryson said "Yes". Is this an issue that you are aware of?
  (Mr Milburn) I have not seen that particular evidence, Chairman. As far as issues of capacity are concerned—

  967. Can we come to capacity later on.
  (Mr Milburn) No, no.

  968. I am specifically interested in workforce.
  (Mr Milburn) I am just going to say I think the workforce is a capacity issue, with respect. Our big capacity constraint is the workforce issue. We have problems on operating theatres and beds in hospitals and all the things the Committee knows about but the biggest rate limiting factor that we have as far as growth in care for NHS patients is concerned is staff, whether that is medical staff, whether it is nursing staff or so-called clinical support staff by medical scientists and so on and so forth. Now, as far as these issues are concerned about the relationship between private practice that NHS consultants undertake, and have undertaken as you know since 1948, and their NHS work, there are some issues to resolve there, as you know. There are a number of ways that we can do that. We have a particular proposal, as you know, which we are negotiating on at present with the British Medical Association, trying to form a new consultant contract. We have dealt with many issues in those negotiations. The negotiations which Andrew has been leading for us I think are going well so far but there are some very tricky issues. Undoubtedly the issue of private practice will be such a tricky issue. It has been unreformed as an issue and as a contract for over 50 years. We have got a particular proposal which, as you know, is that for a period of up to perhaps seven years we would suggest that once a doctor has qualified and become a fully fledged NHS consultant then they should work exclusively for the National Health Service. There are other options and other options which can be looked at but I think the options that could be posited as an alternative to the one that we have on the negotiating table are either unfeasible or, frankly, unaffordable.

  969. You do not see any inconsistency between what I believe is a very laudable aim in attempting to get this seven year commitment and increasing, in a sense, the demand for the private work of consultants by sending additional numbers of patients into the private sector?
  (Mr Milburn) No because I think—

  970. How can you square it? It does not seem logical.
  (Mr Milburn) I think you missed the differentiation that really counts then. I think the differentiation is that under the Concordat what we are doing is treating more NHS patients and hopefully getting them treated more quickly. It just so happens that some of that treatment under the Concordat and an increasing proportion of the treatment under the Concordat is going to be in private sector hospitals but, as I have explained to this Committee in the past, the patient remains an NHS patient. They are treated according to NHS principles, the care is free, they do not pay for it, the state pays for it. It is as if they are a fully fledged NHS patient because they are a fully fledged patient.

  971. I fully understand that.
  (Mr Milburn) There is a differentiation between the time that consultants have. You see what I want, I want two things. First of all, I think what we need is a bigger relationship not a smaller relationship between the National Health Service and the private sector in general. I think there should be a long term relationship and not a one night stand. I think we want to see improved capacity, more services being made available to more NHS patients and if, as we all accept, there is a problem with capacity as far as health care is concerned, and if we have spare capacity, whether those are resources, infrastructure or expertise, and we can harness that for the benefit of NHS patients, then that is precisely what we should do. Indeed, today we are announcing further expansions in the relationship between the NHS and the private sector as far as pathology services and primary care services are concerned. So that is the first thing that I think we need to see: an expansion and not a retraction.

  972. If this expansion is the way forward why are we proposing to have a seven year commitment for new consultants?
  (Mr Milburn) Because of the commitment to have exclusive use of NHS consultants' time and expertise and talents, after all we have trained them at considerable expense to the taxpayer and I want them for the benefit of NHS patients. Consultants' time falls into two periods generally. Actually the majority of consultants, around 57 per cent of NHS consultants work on a whole time basis for the National Health Service. A minority work on a maximum part-time contract—I think it is around 27 per cent—and some of them work a large proportion of their spare time, so to speak, in the private sector, others do not, but the differentiation in the time that is available that a consultant has is between work on NHS patients (and, frankly, for me that can be work that is undertaken in a NHS hospital or, for that matter, in a BUPA hospital or a GHCG hospital, provided the care is for free and it is treating NHS patients as NHS patients) and the privately paid for work that consultants do. What our proposals are all about as far as the new consultant contract is concerned, is trying to get a bigger share of NHS consultants' time for the benefit of NHS patients. Where that care and treatment takes place, whether it is in a private sector hospital or a NHS hospital is, frankly, a secondary consideration. A primary consideration for me—and this is what we are seeking to negotiate, difficult though it is—is that when consultants first qualify, we want to get a bigger slug of their time for the benefit of NHS patients, and what we are proposing is an exclusive use of their time for perhaps up to seven years. That has to be negotiated, and I know you will have heard from the British Medical Association and I know that the proposal is deeply controversial, and I have got no doubt that it will be opposed in many quarters, but I think it is the right thing to do. There is a deal on offer which is pretty straightforward. We are prepared to pay NHS consultants more in order to get more of their time to treat more NHS patients more quickly.

  973. Can I put to you a question that I put to colleagues from the private sector who gave evidence before Christmas. They indicated that over 70,000 patients had been treated under the Concordat and these were people treated in the private sector under the Concordat. I asked what the impact might have been on the NHS waiting lists if those NHS consultants who were working part time in the private sector were working whole time in the NHS, and they could not answer that point. There was some discussion at the Committee of Public Accounts recently and some suggestion from one member that that would be the equivalent of 2,000 additional consultants in the NHS. I notice that your memorandum since the last meeting suggests that 1,500 whole time equivalent consultants would come into the NHS as a consequence of that. Why would the Government not take that approach as opposed to, as I see it, pushing more doctors into the private sector?
  (Mr Milburn) Because it is not feasible, it may not be legal, and it certainly is not affordable. There are a number of options. What we could do—and I am not saying we are going to do this or that we have even considered it or are considering it but these suggestions have been put to me by you amongst others—is go for a total legal ban. We could say that NHS consultants are only going to be allowed to work inside the National Health Service and we could try to enforce that legally. I think the end product of that in behavioural terms would be very simple. You would have a whole host of NHS consultants that we need to treat NHS patients upping lock, stock and barrel. Remember, there is a constrained labour market. We do not have too many NHS consultants, we have got too few, and they will up and leave and go and work in the private sector. Why would they do that? Because, quite simply, some of them, not all, can earn a lot more money. Certainly if you are a surgeon you can earn a lot more money. I do not think that is feasible, point one. Point two, you could try to compensate them for a total and utter ban on doing any private work. I think that is unaffordable and we have done some back-of-the-envelope calculations looking at what it would cost. If you were to do that either what you could do is simply compensate the people who are currently earning quite a lot of money from working in the private sector. There are some people who earn £50,000, £100,000, some well in excess of £100,000, and you could compensate them and give them a bigger NHS pay packet. I think that is a pretty perverse thing to do. You would be paying the people who had done more private work and less NHS work more than the people who had been doing a lot of NHS work—geriatricians, psychiatrists, physicians, A&E consultants who, by and large, work in the specialties where there is not a lot of private practice. That seems to me to be an illogical and unfair thing to do. Or the alternative is that you would have to compensate every consultant, every single one, for the potential loss of private sector earnings even though a majority of consultants probably do not have private sector earning power. We reckon that if you assume that consultants, if they are working in the private sector, might earn between £50,000 and £100,000 as a matter of normality, given the fact that we have got 26,000 NHS consultants, that would cost us a cool £1 billion before we had even started and I do not think that is a sensible use of NHS resources because, in effect, what we would be doing is paying huge dead weight costs at public expense for very little benefit. In other words, we would be paying people a lot more money for compensation when, in fact, they were not even working in the private sector. There is a final option which is that we continue with the current confusion and mess because I think it is confused and I think it needs sorting out. Our conclusion is that our best option is the sensible compromise option that we put forward in the NHS Plan which is trying to get NHS consultants when they are newly qualified for a period of up to seven years to work exclusively for the National Health Service. As you know, that has got to be negotiated with the British Medical Association and we shall see how that goes.

  974. Before I bring some of my colleagues in, can I pick up one other point Miss Bryson made to the Committee. Her argument was that waiting lists would be sustained in her area. She said that the consultants concerned were not wanting their own private lists to be affected so even though these people were moving to the private sector under the Concordat, the consultants were unhappy about losing patients from their private lists. She suggested that there was a need to look at the management of the waiting lists. That is an area that you have looked at. Can you tell us where the Government is on the question of removing it from the actual consultants?
  (Mr Milburn) Let me say, first of all, that it is very, very important when we highlight these problems that we do not forget the context for this which is that the overwhelming majority of NHS consultants are doing a brilliant job for the National Health Service and are probably over-fulfilling their contractual obligations rather than under-fulfilling them and working pretty damned long, hard hours to treat a lot of NHS patients. I would not want anybody to get the impression that somehow or other we have a whole host of NHS consultants who are not pulling their weight because that simply is not true. As far as issues about how best waiting lists are managed, I think that is directly related to how best we manage NHS consultants' time. At the moment, as you know, there are within the NHS consultants' contracts a whole host of so-called flexible sessions. We have as a negotiating brief in these negotiations with the BMA an objective to ensure that there is better planning of NHS consultants' time, so that we get better and more treatment to more NHS patients. That is something that we have got to hammer out in negotiations and I do not want to get into the detail of what we have been talking about in the negotiations for obvious reasons, I do not want the negotiations to be compromised, but so far I think Andrew would say they have gone pretty well and we have got to continue and hopefully reach a conclusion before too long.

Mr Burns

  975. Secretary of State, I must say there was a certain irony listening to your comments at the beginning of this session because, of course, when the last Government paid for NHS patients to be treated in private hospitals that Government was accused by some of your colleagues of creeping privatisation of the National Health Service and yet you are now doing it with a vengeance. What I wonder is you have opened up a Pandora's Box in recent weeks with other areas of what has been accused by colleagues of your's in the past as privatisation of the health service. For example, hotel charges, something that even Margaret Thatcher in the height of her powers ruled out. We have seen you floating the idea that maybe the health service is open to privatisation in certain areas like hotel charges and I would like to just press you for a short time on those. Would you rule out charging hotel charges for things like food in hospitals?
  (Mr Milburn) I do not think we should charge for food, no.

  976. At all?
  (Mr Milburn) No.

  977. So why float it?
  (Mr Milburn) I have not floated it. Where have I floated it?

  978. The Independent on Sunday.

   (Mr Milburn) Well, do not believe everything you read in the newspapers. You will be sorely disappointed in life, Mr Burns. I am day in and day out—I do not read the damn things.

  979. I am sure you are. I am sure you do not believe anything which has not been spun by Millbank but one does come to believe that —
  (Mr Milburn) Shocking, shocking allegation and I hope that you can substantiate it.

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