125. The Government is also applying the principles
of Public Private Partnerships to primary care facilities though
the introduction of Local Improvement Finance Trust (LIFT) schemes.
The drive behind this initiative is the need to improve the current
stock of primary care facilities. In its memorandum, the Department
acknowledged that a large element of the current primary care
estate was no longer suitable for the provision of modern healthcare.
This point was reinforced by the Secretary of State:
"Primary care in too many parts of the country,
particularly the poorest parts of the country, is appalling. 40
per cent of GP surgeries are purpose built, virtually the remainder
are either adapted houses, residential buildings, or adapted shops,
and we expect modern primary care to be carried out in those circumstances.
80 per cent of the accommodation is too cramped to meet modern
Furthermore, the Department pointed out that fewer
than 5% of premises were co-located with a pharmacy, and that
a similar number were co-located with social services.
126. It is widely accepted that the current stock
of GP premises is in disrepair. The NHS Alliance told us that
traditional investment by GPs themselves had been poor, while
the BMA contended that "the investment to replace the old
NHS building stock and to catch up on the backlog of maintenance
was sorely needed".
The CBI believed that LIFT represented a "critical initiative
which should help stem the massive loss of inner city GPs 35 per
cent of whom have been scheduled to retire between 1998 and 2005".
127. The LIFT initiative was first announced in The
NHS Plan when the Department committed itself to investing
up to £1 billion in primary care facilities. This would be
targeted at a substantial refurbishment or replacement of up to
3,000 family doctors' premises by 2004, and the creation of 500
one-stop primary care centres.
These new centres would draw together the many strands of primary
care to include GPs, dentists, opticians, health visitors, pharmacists
and social workers. Though the bulk of this investment would come
from the private sector, the Department was also investing £195
million in the initiative.
Therefore, unlike PFI projects, the Department would hold a financial
interest in the projects.
128. The Government put flesh on the bones of this
announcement with the publication of the LIFT prospectus in July
2001. The prospectus
noted that while private money was not a new development in primary
care - many primary care premises had traditionally been built
and provided by the private sector - hitherto such investment
had tended to be on a piecemeal basis.
This investment was not well targeted and as a result GPs faced
significant disincentives to practising in inner city areas. The
Department asserted that LIFT would counter these problems by
"providing an integrated range of primary and intermediate
care services; leasing premises to individual primary care service
deliverers, such as GPs, on flexible terms that can respond and
adapt to changing requirements over time; and management of the
facilities provided, such as maintenance over the whole life of
the assets, providing all energy and utility requirements".
129. The Department explained that LIFT would operate
at both national and local level. At the national level it had
established a national joint venture company, Partnerships for
Health, comprising Partnerships UK and the Department which had
as its corporate objective the facilitating of the development
of the LIFT initiative.
At local level, LIFT schemes would engage a range of private and
public sector interests in a joint venture drawing together local
health bodies, the national joint venture company and the private
sector. The private sector partner would be identified through
a competitive procurement exercise and then a joint venture would
be established between local health economy bodies, the national
joint venture company and the private sector partner.
130. Mr David Goldstone, Chief Executive of Partnerships
for Health, told us that the national joint venture had been set
up to make LIFT work in practice. As a facilitator, Partnerships
for Health's role was to encourage greater common thinking about
those services and facilities that were required locally. It would
also lend assistance to the contract process and was developing
a suite of documentation intended to become a standard package
to implement local projects.
One of the driving forces behind this was the experience of the
first PFI Schemes. Mr Goldstone explained that such documentation
would facilitate the recycling of knowledge and experience and
that "setting up a focused organisation to deliver this is
helping to ensure consistency of approach and recycling of lessons
131. Central to the LIFT initiative would be the
targeting of Health Action Zones with high levels of unmet need.
While surgeries in more affluent areas are generally able to attract
private investment, surgeries in more deprived areas tend to suffer.
Therefore LIFT will specifically target those areas with the greatest
need. The Secretary of State suggested LIFT would be a means of
addressing health inequalities:
"The existing way of providing primary care
premises and providing primary care positions, GPs, has been to
gravitate more and more resources crudely to the leafy suburbs
and less to the inner cities. We know that the biggest health
needs are in the latter rather than the former. The leafy suburbs
do pretty well out of the existing arrangements, which are partly
private sector led. What this is all about is trying to address
the balance and making sure, again through innovative PPP arrangements,
we get more resources and more capacity into those parts of the
community which need the most."
132. The NHS Alliance welcomed this targeting but
was concerned that areas where there had been adequate investment
by GPs would appear the most attractive areas to private investors
in LIFT. The Department's
first six LIFT schemes - Barnsley, Camden and Islington, East
London, Manchester Salford and Trafford, Newcastle and North Tyneside
and Sandwell - do reflect inner city targeting.
However, these schemes are a long way from completion. When we
took evidence from Partnerships for Health, we were told that
the projects were still at the development stage. Much of the
current work concerned the physical assets of the LIFT scheme,
and we were told that it would be some time before permanent solutions
133. LIFT is in its infancy, but we believe it
does offer the potential to rejuvenate the current stock of primary
care facilities in those areas of greatest need. We welcome, in
principle, this initiative. However, we recommend that the Government
carefully monitors LIFT to ensure that it is directed so as to
ensure provision in areas of highest need and promote greater
integration of primary healthcare provision.
Value for Money
134. One of the prerequisites of the Department's
use of PPPs and the private sector is that it should provide good
value for money. The LIFT prospectus did not make it clear how
value for money for LIFT schemes would be defined. Unlike PFI
projects, there appears not to be a public sector comparator.
The NHS Alliance saw this as a weakness, arguing that a detailed
assessment of the first wave of schemes should be undertaken to
establish value for money before LIFT was rolled out nationally.
We questioned Mr Goldstone about how value for money would be
assessed. He told us that a number of safeguards were in place
to protect the public purse:
- there was a competitive process to determine
the partner for the LIFT project and competition tended to yield
good value for money
- rent levels would still need to be approved by
district valuers within the existing statutory red book scheme,
thus ensuring that rent levels were reasonable
- the fact that the public sector maintained a
stake in the scheme ensured that Government had access to the
accounts and a share of profits
- the LIFT scheme had the ultimate sanction of
severing links with the private sector partner if that partner
persistently failed to honour the contract.
135. While such mechanisms offer a degree of control,
we were unconvinced that they would necessarily be sufficient
fully to protect the public purse. Our witnesses from the BMA
and the NHS Alliance were also unconvinced. Dr Stanton from the
BMA expressed "a degree of honest scepticism" that this
would ensure value for money while the NHS Alliance suggested
that an independent body should appraise LIFT schemes "in
terms of value for money, in terms of whether the premises meet
the specifications and the needs of the community, whether the
service charges are exorbitant or whether the services actually
service the properties as they need to".
136. We were also surprised to learn that the first
six schemes were not pilot schemes and that the programme did
not provide for a pause whilst these were evaluated.
However, the Secretary of State made his position clear: "They
are not pilots. In fact I have announced the second wave today
of 12 further initiatives. We are just getting on and doing this".
Our surprise was shared by the BMA who believed that "common
sense would suggest that it might have been better to see the
outcome of the first six before rolling out others".
The NHS Alliance also thought that LIFT should be "piloted
in defined areas to begin with and rolled out nationally only
when there is clear evidence that it can provide value for money,
quality and equity".
Mr Coates explained that the first six schemes would be assessed
and that "a standard business case assessment will look at
both the numbers and the quality so that ultimately the prime
test will be what numbers come out and whether they are providing
value for money for the taxpayer".
137. We accept that the pre-LIFT mechanism would
often have involved private sector schemes, however we believe
that it would have been prudent to conclude the assessments of
the first six schemes before rolling out LIFT nationally. We recommend
that the Government undertakes a rapid assessment of the first
schemes, both in terms of value for money and service provision,
though we recognise the urgent need to refurbish the primary care
138. We recommend that health authorities should
be asked to prove that work has been carried out to show that
LIFT schemes have been considered in the context of integrated
strategic planning of healthcare assets. We recommend that the
business planning process for LIFT and acute hospital PFI schemes
should be required, at every stage, to take a whole systems approach,
that is, to look at the potential for an integrated local approach.
204 Ev 7. Back
Ev 7. Back
Ev 186; Ev 188. Back
Ev 300. Back
NHS Plan, paras 4.11 and 4.12. Back
Ev 8. Back
Public Private Partnerships in the NHS: Modernising Primary
Care in the NHS/ NHS Local Improvement Finance Trust (NHS LIFT). Back
Ev 7. Back
LIFT prospectus, p.20. Back
Ev 8. Partnerships UK is itself a PPP: it is 51 per cent owned
by the private sector and 49 per cent by the Treasury and the
Scottish Executive. Its corporate objective is to facilitate the
development of PPPs. Back
Ev 8. Back
Ev 8. Back
Ev 186. Back
Ev 8. Back
Ev 186. Back
Q787; Q789. Back
Ev 186. Back