Posts Tagged ‘Department of Health’

Basu and Stuckler on the Privatisation of the NHS

July 22, 2016

Body Economic Pic

Earlier this week I put up a piece about The Body Economic: Why Austerity Kills, by the medical researchers David Stuckler and Sanjay Basu (New York: Basic Books 2013). The book shows, using examples of recessions from the Great Depression of the 20s and 30s, to contemporary Britain and Greece, and the massive privatisation of the Russian economy after the Fall of Communism, how recessions and the austerity programmes that Conservatives use to try and correct them, also cause health crises. Conversely, welfare states that support people, not only give their peoples good health, but also create prosperity.

The two authors are also very much aware that the British National Health Service is being privatised, and are very critical of this. They write

Today the NHS’s founding principles are being forgotten, as the conservative Tory government seeks to make the NHS more like the American profit-driven, market-based system. When the Tory government came to power, they revisited a pamphlet developed under the previous Tory government of John Major that called the NHS a “bureaucratic monster that cannot be tamed” and in need of “radical reform”. In 2004, Oliver Letwin, the pamphlet’s lead author, said the “NHS will not exist” within five years of a Tory election victory. Indeed, after the Tories came to power they proposed the Health and Social Care Act, which embodied the free-market principles of the radical pamphlet.

It was difficult for us to understand this decision. Overall in 2010, before the Tory government began dismantling the NHS, the UK spent less of its GDP on health (8 percent) than Germany (10.5 percent), France (11.2 percent) or the United States (19 percent). Ultimately, the Tories’ position was not based on evidence but ideology-the idea that markets, competition, and profits would always be better than government intervention.

A highly divisive public debate over the Health and Social Care Act ensued. Over staunch opposition from the Royal College of Nursing and almost all of the medical Royal Colleges (the UK equivalents of the American Medical Association), Parliament approved the Act in 2012. Thus began what many regard as a major move towards privatization of the NHS. Repeatedly, David Cameron promised the British public that the Act was not “privatising the NHS” and that he would “cut the deficit not the NHS.” The Liberal-Democratic leader Nick Clegg said, “There will be no privatisation.”

The Department of Health website even stated that “Health Ministers have said they will never privatise the NHS.” But the data tell a different story: increasingly, the government is transferring large swaths of healthcare provision to private contractors.

Private profiteers are replacing dedicated doctors. In October 2012, the government awarded 400 lucrative contracts for NHS services, worth a quarter billion pounds, in what was called “the biggest act of privatisation ever in the NHS.” Virgin, for example, won lucrative contracts to deliver reproductive care (no pun intended). But the result was not the efficiency of private enterprise, but what had already been seen in the US market model-profits at the expense of patients. One journalist found this to be the case at health clinics in Teesside, northeast England. After Virgin won contracts to take over the services, the clinic repeatedly missed targets for screening people for chlamydia. It was a simple task that the NHS fulfilled easily. The journalist found a memo that revealed “staff were asked to take home testing kits to use on friends and family to help make the numbers up.” In Oxford, patients complained about increasing wait times to see their doctors after Virgin took over a local practice. Virgin responded that the practice had been underperforming when it was taken over, and that “there are still improvements to be made but we’re pleased that progress so far was recognised and applauded by councillors.” And so began what continues to be a highly sophisticate public relations campaign.

The UK’s next step toward US-style market-based medicine is moving forward at the time of this writing. It encourages patients to spend out of their pockets for healthcare rather than use the government-funded NHS. The Tory government is extending pilot projects to offer those with chronic illnesses “personal budgets” so that they themselves can make choices about how to manage their care, with few safeguards against profit-seeking swindlers or predatory insurance companies despite a government evaluation that highlighted many problems with this approach.

Early evidence suggests the Health and Social Care Act may in fact be hazardous to the health of the citizens and residents of the United Kingdom. Just before the Coalition government came into power, the NHS had the highest patient approval ratings in its history, over 70 percent. Within two years, approval fell to 58 percent, the largest decline in three decades. There are already warning signs that the healthcare situation in Britain may come to resemble that in the US before Obama. Patients are being turned away from privately managed clinics, some of which simply close their doors after meeting a daily quota to fulfill their contractual obligations. And in the first year of reform, emergency room visits jumped to the highest in the decade- perhaps because more people are neglecting preventive care, like Diane. As the editor of the Lancet warned, “people will die.”

Whether the British people will fully accept this radical privatisation of their healthcare system remains unclear. But once market incentives take hold of a public system, it becomes difficult, if not impossible, to reverse course. In the UK, the recession-fueled combination of austerity-and-privatisation seems to be creeping into every dimension of the social protection system. But evidence of its harms should give us all pause. (pp. 105-7).

Part of the way the government is selling its privatisation of the NHS to the public is through artificial funding crises, in which hospitals develop massive budget deficits. They are then amalgamated with another hospital under a PFI scheme, or given over to a private healthcare company to manage. Points West, the local BBC news programme for the Bristol region, last night revealed that Southmead hospital was also in the red to the tune of £48 million. And I suspect a similar fate is being lined up for it here.

This privatisation must be stopped, and those who support it – the Conservatives, and the Blairites in New Labour, must be thrown out of office immediately. Only Jeremy Corbyn has said that he will reverse the NHS privatisation. It is up to us to support him, regardless of the smears from the media and the Right.

Basu and Stuckler on the Rise in Suicide in Britain due to Austerity

July 20, 2016

Body Economic Pic

A few days ago, I blogged about the book The Body Economic: Why Austerity Kills, by the medical researchers David Stuckler and Sanjay Basu. This book examines how recessions and austerity programmes affect people’s health. Where governments invest in social security safety nets and a welfare state, public health can even improve during a recession. Where they don’t, and actually cut services, public health can decline disastrously.

In one chapter, they discuss schemes piloted in Sweden in actively getting people back to work, concluding that these have had a real, positive effect in maintaining that country’s health when it suffered the recession. They contrast the experience of the Scandinavia countries, with Britain, where MPs were uninterested in implementing similar reforms over here, and made matters worse by cutting the welfare state and support for industry. They write

With all of this evidence accumulating I favor of ALMPs (Swedish-style ‘back to work’ programmes), we were eager to translate these data into practice. After we published our research in 2009 about the benefits of ALMPs, we were invited to the British House of Commons and the Swedish Parliament to present our date and recommendations.

The responses were remarkable – that is, remarkably dissimilar-in the two countries. When presented with the data that unemployment led to a rise in suicides, and that ALMPs could help mitigate the risks, the Swedish members of Parliament were unsurprised. One member asked: “Why are telling us what we already know?” But when we presented the same data in the UK, in July 2009, to the House of Commons, the reaction was that the government was “already doing all it could to reduce unemployment.”

When the Conservative government came into power in 2010, the UK response became even worse. In 2012, the British Medical Journal published our paper showing that UK suicides had risen by more than 1,000 between 2007 and 2010 above pre-existing trends, corresponding to the continued rise in unemployment. Reporters soon contacted the UK Department of Health for a response. it’s spokesman told the Independent newspaper: “Losing a loved one [tpo suicide] can be devastating and we want to make sure that we are doing all we can to prevent suicide by giving people the right support when they need it most. We will shortly be publishing our new suicide prevention strategy, which brings together expertise across healthcare, criminal justice and transport to maintain or even decrease the current rates of suicide.” This sounded encouraging. But then the Health Department spokesman continued: “However, suicide rates in England have been at a historical low and remain unchanged since 2005. The department uses three-year rolling averages for monitoring purposes, in order to avoid focusing unnecessarily on fluctuations instead of the underlying trend.”

By now, this tactic should sound familiar: averaging-out deaths is the same the technique The Economist used to cover up death rates in Russia. When using rolling averages, any large jump in death rates can seem like a smooth bump in the road instead of a shocking spike (indeed, the Department appeared to have chosen the three-year period specifically for this end, instead of some other date range like five years). The Department’s comments were criticised by several university professors and statisticians, after which the statement quickly disappeared from their Internet webpage.

If it wanted to help its people, the British government could learn much from Sweden’s experience. The UK would of course need to invest more in ALMPs and stop job losses from happening. but the Conservative government was doing precisely the opposite: austerity was creating an active labour-destroying programme. The data revealed that the austerity programme cut public-sector jobs in the most deprived regions of the country. Moreover, it was implementing policies that made it easier for the private sector to lay off people during the recession. As one unusually blunt 2010 report commissioned by the government explained, “some people will be dismissed simply because their employer doesn’t like them,” but argued that this is a “price worth paying” to boost the economy, though the logic of how mass unemployment would drive economic growth was left unexplained.

The consequences of the UK’s real-world experiment with austerity soon became tragically apparent in its suicide data. As in the US, the Great Recession in the UK featured an initial spike in unemployment and job losses in 2007. As employment began to recover in 2009, suicides began to fall. But the following year, when the Conservative government came to power, the UK began a massive austerity programme, which in 2012 alone cut 270,000 public-sector jobs. The UK then experienced a second wave of “austerity suicides” in 2012. (pp. 119-121).

This is a savage indictment of the stupidity, callousness and sheer, culpable cruelty behind the Tories austerity programme. And numerous bloggers, from Stilloaks, Tom Pride, Mike over at Vox Political, Another Angry Voice, DPAC, Johnny Void and so many, many others have blogged about the people behind the deaths, many of whom took their lives because of the government’s daft regime of benefit sanctions.

It’s time to end this grotesque charade of murderous neoliberal policies, justified with lies, and get rid of the Tories and their counterparts in the parliamentary Labour party. That’s if we want a happier, healthier and more prosperous Britain, not a country of burdened wage-slaves, deceived and exploited for the benefit of the corporate elite.

Monbiot’s List of the Corporate Politicos in Blair’s Government: Part Two

April 23, 2016

Stephanie Monk

Human Resources director, Granada Group plc., which appealed against an industrial tribunal to reinstate workers sacked for going on strike after their pay was cut from £140 to £100 a week.

Member of the Low Pay Commission on the minimum wage, and the New Deal Taskforce.

Sue Clifton

Executive director, Group 4, criticised for mishandling of child offenders after escapes, bullying, riots and attacks on staff.

Advisor to the government’s Youth Justice Board on how young offenders should be handled.

Keith McCullagh

Chief executive of British Biotech. This company has been repeatedly censured by the Stock Exchange, particularly when it was revealed that it’s leading drug product didn’t work.

Chairman of the government’s Finance Advisory Group to help high-tech companies gain financial investors’ confidence.

Sir Robin Biggam

Non-executive director, British Aerospace, which sells weapons to Turkey, some of which are used against the Kurdish separatists.

Chairman of the Independent Television Commission. This revoked the license of the Kurdish satellite station Med TV because of complaints from Turkey that it gave a platform to Kurdish separatists.

Neville Bain

Non-executive director, Safeway, one of the supermarkets which was swallowing branches of the Post Office.

Made chairman of the Post Office.

Robert Osborne

Head of Special Projects division of Tarmac Plc, one of the major constructors of PFI hospitals.

Chief Executive of the Department of Health’s Private Finance Unit. In 1998, returned to Tarmac to run PFI division.

David Steeds

Corporate Development Director of Serco Group Plc.

Chief executive of the government’s Private Finance Panel.

Tony Edwards

Director of the TI Group, which owned Matrix Churchill, the company which provided machine tools to manufacture arms to the Iraqis. He is the company’s chief executive, which is engaged in 150 military operations around the world.

Head of the government’s Defence Export Services Organisation, advising the government on granting licenses to companies wishing to sell arms to different countries around the world.

Neil Caldwell

Director of PTBRO, the distributor of the government’s landfill tax money, for which it receives 10 per cent of the amount handled in administration fees.

Director of Entrust, the regulatory body supervising the distribution of landfill tax money.

Judith Hanratty

Company Secretary, BP-Amoco Plc, one of the most controversial mergers of the 1990s as it amalgamated two of the world’s biggest companies.

On the board of the Competition Commission, monitoring and regulating corporate mergers.

John Rickford

On the board of BT, which has been frequently attacked for having too great a share of the market.

On the board of the Competition Commission.

Sir Alan Cockshaw

Chairman of Construction Company AMEC
Watson Steel, part of AMEC group, won contract to build the masts and cables on the Millennium Dome.

Chairman of the government’s Commission for New Towns. Chairman of the government agency English Partnerships, which is supposed to help ensure that new developments meet public needs.

On the board of the New Millennium Experience Company, firm set up by government to supervise the millennium celebrations.

Michael Mallinson

Property of industry lobby group for property developers, the British Property Federation.

Deputy Chairman, English Partnerships.

Peter Mason

Group Chief Executive, AMEC plc. In 1997 the company was the seventh largest recipient of support from the government’s Export Credit Guarantee Department for construction work in Hong Kong.

The trade body to which it belonged, The Export Group for the Construction Industries – has lobbied against the inclusion of environmental and human rights conditions in the Export Credit Guarantee Department’s loans.

On the Export Guarantees Advisory Council, which governs the payment of government money by the Export Credit Guarantee Department. Liz Airey, a non-executive director of Amec, is another member.

Professor Sir John Cadogan

Research Director of BP.

Director-General of the Research Councils, which are supposed to fund scientific work that doesn’t have an obvious or immediate application for industry.

Sir Anthony Cleaver

Chairman of the Atomic Energy Authority Technology Plc, which oversaw the organisational changes at Dounreay. These were criticised by the Health and Safety Executive as leaving the company in a poor position to decommission the site. Some researchers believed that Dounreay was the most dangerous nuclear site in Western Europe.

Chairman of the government’s Medical Research Council, which has been repeatedly criticised for failing to provide research funds for investigating the medical effects of radiation. Also member of the government’s panel on sustainable development.

Peter Doyle

Executive director, Zeneca Group Plc. Zeneca’s a major biotechnology firm, and was the foremost developer in Britain of GM crops. The company was engaged in a ten-year deal with the John Innes Centre in Norwich to find profitable applications for biotechnology.

Chairman of the Biotechnology and Biological Sciences Research Council, which gives substantial funding to the John Innes Research Institute. Employees of Zeneca sit on all seven of the BBSRC specialist committees.

Member of the government’s advisory committee on Business and the Environment.

Professor Nigel Poole

External and Regulatory Affairs Manager of Zeneca Plant Science; sits on five of the taskforces set up by EuropaBio, the lobbying organisation seeking to persuade European governments to deregulate GM organisms.

Member of the government’s Advisory Committee on Releases to the Environment.

Professor John Hillman

Member of the board of the Bioindustry Association, the lobbying group seeking to ‘enhance the status of the industry within government’.

Director of the government’s Scottish Crop Research Institute, charged with supervising government-funded research projects and providing the government with impartial advice on biotechnology.

Antony Pike

Director General of the British Agrochemicals Association Ltd; Managing director of Schering Agrochemicals/ AgrEvo UK Ltd.

Chairman of the government’s Home Grown Cereals Authority (HGCA), carrying out and funding research into cereal crops. It has not funded any projects aimed at improving organic cereal production.

Professor P.J. Agett

Head of the School of Medicine and Health, University of Central Lancashire. This has received support for its research from three companies producing baby milk. Agett has personally received fees from two companies producing baby milk, including Nestle. The promotion of baby milk to developing nations is one of the most controversial issues in food and nutrition.

Chair of the Department of Health’s Committee on the Medical Aspects of Food and Nutrition Policy (COMA). Three other members of COMA have either directly benefited from payments from the baby milk manufacturers or belong to academic departments which have. One of those, who personally received payments was a Nestle executive.

Professor Peter Schroeder

Nestlé’s director of research and development.

Director of the government’s Institute of Food Research.

Sir Alastair Morton

Chairman of the Channel Tunnel construction consortium, Eurotunnel. This had debts of £9m.

Advised John Prescott on financing of Channel Tunnel Rail Link; Chairman of the Strategic Rail Authority responsible for advising the government on the use of significant amounts to the industry, and ensuring that rail transport gives good value for money.

Vox Political: Amazon Boss to Get DWP Directorship

February 4, 2016

Mike over at Vox Political today posted this piece from the Guardian, commenting on Margaret Hodge’s disgust at Amazon’s boss of Chinese operations getting a directorship at the DWP: http://voxpoliticalonline.com/2016/02/04/amazon-bosss-dwp-appointment-is-disgusting-but-when-did-government-departments-start-having-directors/ In his comment, he asks a very pertinent question: since when did the DWP, or the Civil Service as a whole, start having directorships? Traditionally, the heads of the civil service were secretaries over various descriptions, undersecretaries, private secretaries, personal private secretaries, etc. Secretaries by the bushel, secretaries by the bucketful. But no directors. So, he asks, is this indication that the Gentleman Ranker, Ian ‘Snollygaster’ Duncan Smith, wants to privatise another section of the DWP, or indeed the whole government department?

It’s a good question. IDS – just one vowel away from ‘AIDS’, and nearly as poisonous – and the rest of the Tories really do seem to think that privatising everything is the solution. They took this idea over from the Libertarians in America, who want just about everything privatised, even the courts. All in the name of small government. I don’t think even IDS is so stupid that he wants to go as far as completely privatising the justice system, but he and they do seem to follow the libertarian line about privatising the police force. This policy is based on the idea that private corporations are automatically more efficient and more effective than state operated enterprises or organisations. Even when it’s been proved again and yet again that they aren’t. The Civil Service was originally considered unsuitable for privatisation, so they did the next best thing. They quasi-privatised part of it, but separating the Department of Health from the Department of Social Security, and turned the latter into the Benefits Agency. Now it seems that they want to privatise it completely, at least piecemeal.

As for the title of ‘director’, there’s an element of vanity in there. IDS, Cameron and the others have all entered public service from business, and therefore don’t seem to be satisfied with simply having the title and job description as ‘public servants’. No, they want to be seen as hot-shot directors, not secretaries. So directors they must be, even if it’s completely inappropriate. Way back in the 1990s, a similar rebranding occurred in the Department of Trade and Industry. This wasn’t good enough for the responsible minister at the time, who insisted on calling it, ‘The Department of Enterprise’, in line with Thatcherite Yuppie ideology. Well, yuppies have come and gone. A lot of them finally gave up the game when the steam ran out of the part of the Thatcher Revolution, and New Labour came to power, only to carry on her legacy in a slightly less noxious form. But as the idea of directorships in the DWP shows, it’s still there. And it’s entirely inappropriate.

Directors are the heads of private companies, which are driven by the profit motive. The aim of private enterprise is primarily to make money, not to provide a service. The role of the civil service, on the contrary, is to provide a service in spheres which are outside the applicability of the profit motive. It’s why there are just so many regulations prescribing the correct conduct of civil servants and what constitutes corruption. They aren’t there to enrich themselves at the expense of the state or its citizens. They are there to serve the public. This latter point is important. It was imported into the Civil Service ethos by the Trevelyan in the 19th century. His idea of moral, responsible service by state officials was largely based on the old Stoic ideal of service to the state. Trevelyan himself was an utter b*stard in some respects. He had absolutely zero sympathy for the victims of the Irish Potato Famine, and did not want them to be given any relief in their most dire need. It’s an episode which has cast a terrible shadow over subsequent relations between Britain and Ireland ever since. But Trevelyan’s reform of the Civil Service did create an ethos of efficient, responsible public service. IDS’ creation of directorships threatens to undermine this, and throw the whole institution back to the corruption of the 18th century and previously, when officeholders believed that they had an absolute right to exploit their position to the full to enrich themselves.

And in that case, ideology will have come full circle, and the Tories will have gone back to their roots. Modern Neoliberalism has much of its ideological roots in 19th century radicalism. 19th century radicals generally wanted small, cheap, efficient government, free of the webs of patronage and corruption that stifled the economy and prevented individuals from developing their own talents and being rewarded by the fruits of their energy and enterprise. Thatcher and her Yuppy crew largely took power by muttering a lot of nonsense about ‘meritocracy’. It informs the very title of Norman Tebbit’s autobiography, ‘Upwardly Mobile’.

But for all that they mouth Neoliberal clichés about enterprise, efficiency, meritocracy and self-reliance, the Tories aren’t motivated by a desire to increase social mobility, or limit the stifling power of an hereditary ruling class, like the 19th century Liberals. Cameron, Osbo, IDS and their cabinet are toffs. They are the stifling hereditary ruling class. Social mobility under New Labour had all but ceased. Under Cameron it’s stopped completely. And they’re determined to hold on to power, and oppress everyone else. Hugh Montgomery-Massingberd gave the game away in the Times in the 1980s when he loudly hailed Maggie Thatcher as bringing about a ‘social restoration’ of the old country house elite. The only difference now is that the ruling elite are corporations and their managers, rather than an agricultural aristocracy. But the ethos remains of a ruling class, which regards the state and its institutions as their instruments with which to govern and plunder, rather than to serve the greater national good.

From 2007: Suppressed Government Report into Failures of PFI

February 1, 2015

One of the first elements in the gradual privatisation of the NHS was the Private Finance Initiative. Under it, private companies were awarded contracts for the construction and maintenance of the hospitals they built partly through private finance. it was a way of keeping the cost of hospital construction and maintenance off the government books. The downside was that the costs, although hidden, were still massive, meaning that the public was saddled with exorbitant costs for many years, indeed decades to come. Furthermore, the financial risks were never spread evenly. If a private consortium ran into trouble and could no longer make a profit from the deal, it was left to the taxpayer to bail them out.

In their issue for the 21st June – 8th July 2007, Private Eye carried this story about a government report that had been suppressed after it severely criticised the Private Finance Initiative for its numerous and disastrously expenses failures.

The Hospital Report They Didn’t Want You To Read
PFI, the Untold Story

A damning report on hospitals built under the private finance initiative, prepared by the National Audit Office (NAO) but never published or show to Parliament, has been obtained by Private Eye under the Freedom of Information Act.

In 2005 the NAO announced that it was looking into the record of PFI hospitals, but a year ago mysteriously cancelled the study – without revealing that it had already written a hugely detailed 90-page report on the subject. The move came just weeks after Health Secretary Patricia Hewitt had announced a review of the £12bn worth of hospital PFI deals then in the pipeline, in the face of mounting evidence that PFI was unaffordable and unworkable with other Labour health reforms. The last thing she needed was a critical report on the record of the PFI hospitals already up and running.

The NAO insists it was not pressured into pulling the report, entitled The Operational Record of the First Wave of PFI Hospitals, though it refuses to disclose any details of its discussions with the Department of Health on the subject. It claims the “evidence collected was too mixed and not sufficiently conclusive to justify a report to parliament”. Really? Eye readers (and MPs) are invited to study the principal findings and judge for themselves.

The ‘Risk’ Factor

In all 17 hospitals whose costs were looked at, PFI was judged to be a few pounds cheaper when compared to how much it would have cost to build or refurbish the hospital under conventional procurement. But at 15 hospitals this was only after a spurious financial “risk factor” had been applied to the public sector alternative. The factor varied from 1 percent to 22 percent of the cost but was always just enough to make PFI look cheaper. The NAO overlooks the obvious fiddling and swallows the alleged “similarity of costs” without question.

Not So Grand Designs

A comparison of design quality found the PFI hospitals overall, slightly worse than non-PFI ones. On five out of six criteria they were below “minimum acceptable standard” and especially pisspoor architecturally. Although the non-PFI ones used for comparison were mostly 20 to 30 years older and much work has been done on improving hospital building standards in the meantime, this seems to have passed the PFI industry by.

Bed-Hopping Mad

Seventy percent of the PFI hospitals had fewer beds than the facilities they replaced, but all save one had higher rates of occupancy. Indeed, in 70 percent of cases the PFI bed occupancy rate was higher than the officially recommended maximum of 85 percent. Above this figure peak admissions are more difficult to handle, men and women can’t always be separated and infection control is compromised.

The cause of the problem, the NAO found, was that “greater efficiency designed to increase patient throughput … has not yet been fully achieved.” In other words, such is the expense of PFI that in order to produce a remotely affordable deal, unrealistic assumptions about needing fewer beds were made (with the help of financial consultants anxious to get the deal through and secure their success fees).

Three of the PFI hospitals have already had to build extra facilities as a result, putting millions more on the cost of their deals every year. Clinicians are understandably miffed: two thirds said that “affordability constraints” had led to “design compromise”, including at University Hospital Durham where floor area had to be reduced, leading to “shortage of space … and a lack of ventilation”.

Feeling the Heat

“One particular problem”, the auditors noted, “is summer overheating”. PFI hospitals fall well below minimum standards. “At one PFI hospital the contract manager had recently recorded temperatures of over 40 degrees C in the wards during the height of summer,” said the auditors. As the whole premise of PFI and the dodgy value for money calculations is the transfer of risk, solving this problem might be thought to be down to the PFI company. But no. When the auditors visited “it had not been agreed who would bear the cost”.

Cleaning Up

Among the most alarming findings was that “the cost of cleaning PFI hospitals is higher than in non-PFI hospitals and the quality of service is lower”. Not exactly surprising, but with clear evidence that poor hygiene standards increase the incidence of MRSA, C. difficile and other deadly super bugs – exactly the sort of finding Hewitt would not have wanted splashed across the papers last year.

The problem isn’t just cost-cutting by the PFI companies and the cleaning firms they employ: the report noted that “only a fifth of ward managers at PFI hospitals … had sufficient powers of direction over cleaners”. And in the bureaucratic nightmare of PFI, doing something about it isn’t easy either because improved standards “are not necessarily reflected in the service specification”, ie contract.

Making improvements is “likely to require the requesting of a service variation”. Great news for lawyers, not so comforting for patients.

Failure? Fine By Us

When things go wrong it’s invariably the hospital, not the PFI company, that suffers. Two thirds of hospital managers felt that they couldn’t impose sufficient financial penalties on the companies to motivate the PFI company to do its job.

And that’s if difficulties are reported in the first place. Many problems go unpunished as busy nurses have better things to do than hang on the phone to a remote help-desk. “They would often therefore either ignore the failure or deal with it themselves,” say the auditors, with the result that only 30 percent of trusts report “most” service failures. Even if they do, the PFI companies determine how much to fine themselves: “The data for calculating deductions is usually generated by the helpdesk and is therefore the responsibility of the PFI contractor.”

When whole areas of PFI hospitals become unavailable most trusts think the payments they can withhold aren’t enough to make the PFI company return the building to use quickly. In one case, a water leak shut an operating theatre for two days at a loss of 33 operations and a cost to the trust of £24,750. The PFI company was docked less than £5,000.

Red Tape, Red Faces

Anyone who thinks the public sector is tied up in red tape should look at what happens when a PFI hospital needs the private company it’s relying on to make any changes.

If it needs a new noticeboard, say, it can’t just ask a handyman to put one up. It has to get a quote for “supply and fit and life cycle maintenance” (£860 for five of them from one PFI company, since you ask). The NAO report leaves a large space for a “flow diagram of the process for making a minor change”. Unsurprisingly clinicians reported infuriating delays. And it’s not cheap: at Norfolk and Norwich 1,600 “minor “works” (putting up a shelf, changing a plug, etc) came in at £1.2m – £750 a throw. For any bigger change, like altering the use of a room, the process is more cumbersome still. And if it costs more than £5,000, the lawyers and even bankers have to be pulled in as their “risk profile” might be affected.

As a trust manager from Durham put it: “It is not a competitive market, the mark-up by the contractor and the [PFI company] increase the costs, and there is not the incentive for them to come up with affordable solutions.

And the Good News Is …

It’s not all bad news. On the odd incidental like “security” PFI hospitals were judged better. And the report repeats the Treasury’s favoured view of PFI: “The first wave of PFI hospitals were very largely delivered to time and budget.”
Yet again, however, this conclusion is based on the cost of the hospitals once the contract was signed, after which it can’t go up. If the prices when the deals were given the go-ahead were considered, a more appropriate comparison, the auditors would have seen increases of between 40 percent and 230 percent as huge price increases emerged during contract negotiations.

Despite the evidence of innumerable surveys, reviews, field visits to hospitals, independently commissioned technical evaluations, questionnaires and focus groups, at a cost of hundreds of thousands of pounds, Parliament, apparently, doesn’t need to know about the bed shortages, substandard buildings, poor cleaning, labyrinthine bureaucracy and extra costs that come with PFI.

Patricia Hewitt’s own review of hospital PFI deals duly concluded that, subject to some trimming here and there, they could go ahead. Nobody was able to point to damning NAO findings that PFI is about as useful in a hospital as a surgeon with the shakes.

Before the last election, Osborne stated that he would end PFI once the Tories got in power. This is one of the promises that the Tory party has broken. Not only has not ended PFI, he actually increased it and authorised more projects. This probably shouldn’t be a surprise to anyone, as PFI was originally a Tory idea, put forward by Peter Lilley as a way of opening up the NHS to private enterprise.

It needs to be closed down, and the Tories removed from office before they can privatise anymore of the NHS.

Vox Political on Private Healthcare Overcharging the NHS

January 27, 2015

Rapacious Quack

18th Century Satirical Print: The Rapacious Quack. It depicts a poor family at the mercy of a doctor, who has taken away a flitch of bacon in lieu of unpaid fees. Its caption reads
‘The Rapacious Quack quite vext to find,
His patient poor, and so forsaken
A thought soon sprung up in his mind
To take away a piece of bacon.’
Which just about describes the grasping attitude of the private healthcare firms mentioned in the report.

Earlier this evening I blogged a piece on Mike’s story over at Vox Political on Ed Miliband’s promise to rebuild and strengthen the NHS. The piece is Will voters support Labour’s vision for the NHS? and it’s at http://voxpoliticalonline.com/2015/01/27/will-voters-support-labours-vision-for-the-nhs/. It offers hope for an NHS decimated by the Tories, but also by Blair and Brown.

Mike also wonders in the piece whether Alan Milburn, Blair’s former health secretary, is really a member of the Labour party, or a Tory, who has worked his way into Labour to undermine it. He isn’t the only one. A few weeks ago, Johnny Void pointed out how one of the authors of the Archbishop of Canterbury’s report suggesting the establishment of a national network of food banks was Frank Field, and made the same comments about him. Field is notorious for recommending further cuts to the welfare state to encourage unemployed hoi polloi to find work. And it isn’t only his critics, who have suggested he should join the Tories. He also has admirers within that party, who’ve actually made the invitation. The politically Conservative Cranmer blog actually invited Field to cross the floor and join the Tories.

And the same comments could have been made about much of the New Labour leadership. Remember the computer programme back in the 1990s that made anagrams from politicians’ names, supposedly revealing their real character? Michael Portillo was ‘a cool, limp Hitler’. Blair came out as ‘I am Tory Plan B’. Lobster compared Blair to Ted Heath. Both were men leading the wrong parties. Giles Brandreth, who served on John Major’s Tory cabinet in the 1990s, on Have I Got News For You described the Blairs, both Tony and Cherie, as natural Tories. They were, and they similarly pursued a policy of privatising the NHS piecemeal.

In the first few years of this century Patricia Hewitt wanted to sell of the £64bn commissioning and supply arm of the NHS, but ended up having to reject the plan, claiming it was mistaken. She therefore just privatised hospital management. And one of the brilliant ideas of Blair’s administration was the inclusion of private healthcare companies to pick up work that could not be done by an overstretched NHS. Who was the brains behind this, ahem, operation?

Alan Milburn.

And in 2009 Private Eye carried a story about an independent report that concluded the private healthcare providers were overcharging the NHS, including billing for work they did not carry out. The article was in their edition for the 15th – 30th May. Here it is.

NHS Plc.
ISTCs: A Crying Sham

Another crumbling New Labour initiative, independent sector treatment centres (ISTCs) for NHS operations, has ben exposed as a shambolic waste of money.

ISTCs were supposed to provide low-cost operations to an overstretched NHS. But the have long been suspected of creaming off the most lucrative ones under favourable contracts without providing the quality to be found in the NHS.

A 2006 parliamentary report questioned their value for money and asked the National Audit Office to look into it. Several billions of pounds of public money were at stake, but the audit body has oddly shied away from the subject despite reportedly expressing some concern over the ISTCs’ performance and £100m+ procurement costs 18 months ago.

Now academics Allyson Pollock and Graham Kirkwood at Edinburgh University have obtained the contract for one ISTC under Scottish freedom of information laws (contracts in England remain confidential). This shows that the NHS in Tayside paid an ISTC run by Amicus Healthcare – a joint venture of private equity firm Apax and South Africa’s Netcare – for 90 percent of referrals even though the centre only performed 32 percent of them. The academics estimate that Tayside’s overpayments could be dwarfed by those across England, where the NHS could have been stung by up to £927m for operations not performed.

The £5bn ISTC programme was pushed through by the Department of Health’s commercial directorate, set up in 2003 by the then health secretary, Alan Milburn, now earning £30k a year from the private equity firm Bridgepoint that owns ISTCs through Alliance Medical. The directorate was run by American Ken Anderson (since decamped to Swiss bank UBS’s private health investments) and was exposed by the Eye two years ago as home to 220 consultants on an average £238k a year, much channelled through tax-efficient service companies. It has since been quietly disbanded without ever having faced the scrutiny it warranted.

This effectively explains why Milburn was so keen to pour scorn on Miliband’s plans for the NHS: he’s working for a private equity firm that will lose work in that area if Miliband starts to take seriously the NHS’ commitment to providing free state medicine.

It also shows how better governed Scotland is than England. The two academics are able to get details like this through the Scots freedom of information act, which is denied to citizens south of the Border.

As for Amicus Healthcare, I remember Amicus as the American rival to Hammer films way back in the 1970s. Although American, they used much of the same actors and production staff. Sadly, Hammer and Amicus passed away, though the horror continues under the Amicus name.

From 2011: Private Eye on Failure of Outsourcing Companies

January 21, 2015

Private Eye in their issue of the 2nd – 15th September 2011 also published this article on the failure of the government’s outsourcing contractors, despite their campaign to give them even more government work.

Public Services
Source of Discontent

Last month a group of MPs took time from their summer holidays to announce the formation of a “new all-party group to help government save money through smarter outsourcing”. The chairman, new-boy Tory MP Bob Blackman, celebrated its launch by claiming that “the outsourcing of services represents an opportunity to reduce costs and, at the same time, improve the quality of service provided to the public”.

Well, maybe. But this campaign for cheaper and better services is funded by companies whose work for the government has been wildly expensive and of wretchedly poor quality.

The group receives “benefits” from the National Outsourcing Association (NOA), which runs its “secretarial services” and seems to have been instrumental in its foundation. The “premier members” who run the NOA include the Computer Services Corporation (CSC), Fujitsu and Atos. Far from saving cash, these outsourcers have wasted hundreds of millions of pounds.

CSC is one of the main contractors on the disastrous NHS National Programme for IT. So far the Department of Health has paid CSC aro0und £854m for patient record systems that don’t work as promised. If CSC is allowed to complete its contracts, the DoH will have to pay it more than £3bn. According to the House of Commons public accounts committee, the DoH believes CSC is “in breach of contract” but feels unable to cancel the deal because it “may be more expensive to terminate the contract than to complete it”. The committee believes the government should give “serious consideration to whether CSC has proved itself fit to tender for other government work”. The committee believes the government should give “serious consideration to whether CSC has proved itself fir to tender for other government work”.

Fujitsu was also a contractor on the NHS patients’ record system, with an £896m contract in the South East. The company walked away in 2008 without delivering the system, and is now suing the government for £700m lost revenue.

ATOS Origins has many contracts assessing the disabled for benefits. Its Incapacity Benefits Assessment contract was investigated in July by the Commons work and pensions committee, which found the firm had “often fallen below the standard claimants rightly expect. This has contributed significantly to the widely felt mistrust of the whole process”. Many claimants who were denied benefits had them reinstated on appeal.

How were MPs persuaded that these were the people to deliver cheaper and better services? They may have been won round by a group of former Tory MPs and Labour local government figures who outsourced themselves by setting up a lobbying company called Butler Kelly – which now works for the National Outsourcing Association and helps to run the new all-party group.

The catastrophic failures of the outsourcing companies seems to be just par for the course. Since the 1990s Private Eye has documented the long history of failure of government outsourcing contractors, such as Capita and G4S. Indeed, Capita is so notorious for its poor performance that the Eye has given it the nickname ‘Crapita’.

What is particularly noteworthy is the incestuous nature of the outsourcing process. In the 1980s and 1990s the ministers and civil servants in charge of particular nationalised industries recommended their privatisation. Then, after this had been done, they turned up on the boards of the new companies. Or else they were already on the boards of private companies pressing for the industries’ privatisation. This pretty much follows that same pattern, with the MPs and local government officials pressing for the further outsourcing of government contracts actually running lobbying company involved with the outsourcing groups. It’s very much like the way the Tories demanding the privatisation of the NHS actually being on the boards of the private health care companies hoping to win government contracts. There is a very good meme floating around the net on precisely this point, put together, I believe, by the Angry Yorkshireman, and reblogged by others like Mike. It’s a fine example of the crony capitalism, that goes all the way back to the ‘sleaze’ in John Major’s administration. It’s why the Conservatives have rightly earned themselves the monicker ‘Self-servatives’.

Private Eye 2011 on Circle Health

January 20, 2015

Last week the Circle Health group finally pulled out of its contract to run NHS hospitals. The standards of care were appalling, and the company had not been able to make the massive profit it expected. Four years ago in their 24th June – 7th July 2011 issue, Private Eye printed this story about Circle Health, and what their acquisition of government contracts augured for the rest of the NHS under the Tories’ privatisation plans.

NHS Competition
Circle Health Merry-Go-Round

As the debate rages over greater private sector involvement in a reformed NHS, the aggressive behaviour of one private health firm, Circle Health, is a sign of things to come.

Using the ‘”Any Willing Provider” rules that are designed to increase competition in the NHS (and which will continue even after the Conservatives’ current health reforms are watered down), Circle is trying to force two NHS trusts to give it more surgical work and on better terms regarding price and timing.

Circle Health is 49 percent-owned by employees and often described as a “social enterprise”. But 51 percent of it is owned by private investors, including around 40 percent by hedge funds Odey Asset Management and Landsdowne Holdings. Since 2003 Crispin Odey and Lansdowne’s Paul Ruddock and David Craigen have between them donated more than £560,000 to the Conservative party.

In January this year, Circle Health applied to the NHS Cooperation and Competition Panel to demand that NHS Wiltshire and NHS Bath and North East Somerset give it more work and on better terms. The panel, a New Labour quango, is meant to determine when the NHS should give operations to private firms, in keeping with the edict that “any willing provider” should be considered for NHS work in competition with NHS hospitals.

Under the government’s current “climbdown” on NHS reform, the panel will be moved into the NHS regulator Monitor and become the main enforcer pushing NHS privatisation. This is supposedly less aggressive than health secretary Andrew Lansley’s original plan because the panel will now consider “cooperation” as well as “competition”, whereas before Monitor only had a duty to promote “competition”.

Circle Health is pressing its demands on Wiltshire and Bath, who jointly commission NHS services, because it built its flagship hospital in Bath and needs the NHS work to pay for its fancy. Norman Foster-designed building with “chauffeur drive service”, “five-star hospitality” and a bistro serving “locally-sourced, mainly organis food” prepared by a “Michelin-starred chef”.

Local NHS suits must be hoping the panel, headed by former private healthcare investor Lord Carter, looks fairly at the case. Worryingly, he and health secretary Andrew Lansley appear to be fans of Circle Health: in January they were guest speakers at its annual conference at the firm’s Bath hospital.

According to papers lodged with the panel, Circle Health is angry that out of a £160m local budget, its own potential revenues “have been capped at 6m”. It claims the health authorities won’t offer it more contracts because they want to keep work in-house to “protect NHS providers from further potential capacity reduction”. Circle also claims that the health authorities are favouring the NHS by only offering private sector providers four types of surgery. Circle wants more, including the chance to carry out liver surgery.

The panel is due to give its verdict at the end of the month.

In the same piece, the Eye also had this to say about Ruth Carnall, the NHS head, who was also on the payroll of the private health care industry. Unsurprisingly, she also favoured cuts and privatisation, for which she was suitable awarded.

Congratulations to Ruth Carnall, who grabbed a CBE for services to the NHS.

Carnall flitted between running the “Change Programme” at the Department of Health … and jobs with private health firm Care UK and consultants KPMG. She is currently head of NHS London, where her hospital cuts plan for the capital was so aggressive even slash-happy health secretary Andrew Lansley had to call for a pause.

At both the national and local level then, the privatisation of the NHS has been carried out by politicians and NHS heads with links to private health care companies and the firms involved in the privatisation – a clear conflict of interest. As for Circle Health, the events of the past week shows how right NHS BANES and Wiltshire were not to want to give NHS contracts to this outfit of incompetent profiteers.