Lord Darzi’s report makes the government’s desire for privatisation clear, but this will only lead to more debt and deficit in our hospitals.
from the Guardian’s comment is free web site
October 4, 2007 6:00 PM
The government’s new white knight has come to the rescue of the NHS. The newly appointed labour peer and surgeon Lord Ara Darzi has just published his latest unevidenced, planning-free, interim review. It reveals a return to pre-1940s thinking and the launch of US-style healthcare – deserts of poor quality or no healthcare for the many millions (primary care polyclinics) and a few little islands of excellence for the lucky few.
Across the country PCTs are divesting themselves of services. According to the Department of Health draft workforce plan there will be 32,000 staff redundancies. As one email correspondent wrote to me, big American companies such as United and Kaiser Permanente are not slow in making their sales pitch for the NHS (for more details of the way the latter operates, go here). Rumours abound that hospitals are going to be re-branded as “community enterprises” or not-for -profits, before all ties are cut by the government and they are run for profit, with about eight “community hospitals” (subsidised-non-profit NHS-style) left in the country. At the same time GP practices are being set up as commercial ventures. All this is clear in Lord Darzi’s report. But what he doesn’t ever tell us is that the driving force behind greater use of the private sector, community enterprises and asking companies like Tesco to run hospitals and GP surgeries, is the need for the government to get rid of its remaining liabilities before the PFI chickens come home to roost.
In research published on our website last month, Mark Hellowell and I showed the scale of financial problems facing the NHS. Contrary to government claims the problem is not greedy doctors or staff but the real costs of creating a market. In particular the government policy of using PFI and paying for private sector companies to deliver care as an alternative to NHS provision.
The Northern Rock debacle drew attention to the issue of personal debt. But what the public don’t realise is that during the Blair term of office the Treasury was busy building up its own debt mountain, fuelled by PFI. Since Labour came to power, Treasury policy has been to replace most public infrastructure through a sort of sale and lease back arrangement, whereby the government sells off public land assets and building and instead rents back services from the private sector on 30 to 60-year contracts. But the scale of debt is extraordinary. In the NHS alone the total debt is £50bn rising to £90bn. It will lock in future governments and future taxpayers for many decades to come. The NHS currently pays £0.5bn pounds a year in PFI charges and this debt is set to quadruple to £2.3bn a year by 2010. The beneficiaries are the banks, the shareholders and the venture capitalists, the construction industry and facilities management. The losers (markets always make losers) are the service users, staff and the British public. As one politician has said, it is like putting your mortgage on your Mastercard.
And so where is the money coming from to pay the debts and the profits of the new private sector profiteers? Across the country, the NHS is selling off its land and buildings and closing its services. This is happening at an unprecedented rate, fuelled by government policy – which is to switch NHS funds and services away from NHS services to the private sector, including surgical treatment centres. Darzi conveniently ignores the evidence that shows poor quality, high cost and low value for money, in favour of spin.
But our research shows how the government has introduced a new system called “payment by results” which leaves the policy exposed. NHS trusts, especially those with PFI, are paying out more in debt charges than they are receiving from the government – and the result is more debt and deficit. Failure to balance the books is bad for senior managers, and with their own jobs on the line they bring in management consultants who prescribe restructuring. Cuts and closures – or, in Darzi speak, polyclinic care.
Take Worcestershire Acute PFI Hospital; no one will forget how the independent MP Richard Taylor twice came to victory when it was shown that the downgrading of Kidderminster hospital and bed reductions of 30% across the board were driven by the need to make the PFI charges affordable. The sitting Labour MP, David Locke, did nothing. Affordability problems continued even after the merger with neighbouring Redditch and Queen Alexandria hospitals. In 2005/6 Worcester recorded an underlying deficit for that year of £20m, of which £7m was attributed to the “additional costs” of their PFI hospital. It is not being reimbursed for this. Now, in response to budgetary pressures, the trust has developed a “recovery plan”, which involves a reduction of staff numbers by 675 and warns that achieving recurrent financial balance will not be achieved without “even more radical action”, involving “a comprehensive review of services” across its three hospitals, and “serious questions about their sustainability”.
This story is being repeated up and down the land. Hospitals are closing, old people are being evicted from their community hospitals, people can’t get the essential services they need. Physio, speech therapy, nursing, mental health, palliative care, support for learning difficulties – all these services are being decimated. But the real story underpinning these cuts – the government’s desire to privatise and hand the NHS over to large corporations – is not being told. Nor do we hear the story of how public money is being squandered, lining the pockets of Brown’s new generation of entrepreneurs.
The Darzi report states that the government continues to believe in a tax-funded system. It doesn’t mention the many ways in which the erosion of tax funding is already occurring to NHS service loss, for example the privatisation of long-term care, mental health care and dental services, increasingly means the user pays. The entitlement to NHS care has been redefined. For example, some PCTs have removed hernia repair, varicose veins and dermatology services so that people must either go without or pay, and some foundation trusts offer patients the choice of paying for extra care, in maternity packages, speech therapy, physio and other therapy services.
No doubt Lord Darzi has plenty of supporters lining up behind him, ready to boot out the old and bring in the new profiteers.