Keep private hands off our NHS!

Keep private hands off our NHS!

The scale and scope of New Labour’s ambitions to privatise sectors of the health service have caused dismay among even relatively conservative elements – Guardian columnists, the TUC, the Royal College of Nursing.

The Guardian’s editorial column headlined "Last Days of the NHS…" on May 29, warning that:

"A Labour government which fought the last election promising to end the Tories’ internal market in health, is now proposing to go one step worse: creating a sharp-elbowed competitive system involving both private and public health systems. …Labour plans to make more use of the private sector than the Tories ever dared contemplate."

The comment flowed from the publication in the same issue of the leaked, controversial proposals of the Blairite Institute of Public Policy Research (IPPR).

The IPPR called for private companies to run NHS hospitals – but these plans go only slightly further than Labour’s manifesto pledges to set up new surgical units "managed by the NHS or the private sector", and to "use spare capacity in private sector hospitals treating NHS patients free of charge…".

Labour ministers have become totally hooked on the ideology of the free market and the private sector. They cling to the argument that care will still be delivered to the patient free of charge at point of use, but every new stage of Labour policy involves transforming the NHS from a publicly owned, publicly provided service into little more than a pool of cash to be used to buy services from a lengthening list of private sector providers.

The use of private sector beds for NHS patients has doubled since Alan Milburn signed the "Concordat" with the private medical firms last autumn. Private hospitals with over half of their beds usually empty are understandably keen to whip up more lucrative work from over-stressed, under-bedded NHS hospitals.

But of course an expansion of private sector care would require additional nursing and other qualified staff – all of whom are trained, at public expense, by the NHS.

The wacky logic of New Labour’s fixation with the private sector will mean poaching even more nurses from under-staffed NHS hospitals … to treat NHS patients in private hospitals.

Of course there is no evidence that the private sector delivers better quality or even more efficiency than the public sector. Leading health care analysts have pointed to the increased administrative costs involved in expanding private medicine – in the USA privately managed hospitals spend a massive 34% of their budget on administration compared with just 12% in the NHS.

And there are real doubts over the quality of private health care, despite the fact that in Britain the private sector refuses to get involved in any emergency services, and simply "cherry picks" the most simple operations and procedures.

If anything goes wrong in a private hospital, there is often no alternative but to transfer the patient to an NHS hospital with the facilities for cope with emergency situations. While 800,000 elective operations were carried out in private hospitals in the UK last year, a massive 141,618 patients were admitted from the private sector for NHS treatment.

But the private sector as a whole has already driven a massive wedge into health and social care.

The IPPR underlined the fact that already 40 percent of NHS hospital support services are provided by private contractors, while 40 percent of spending on personal social services also goes to the private sector, most of it to nursing and residential homes.

The privatisation of long-term care for the elderly was accelerated by the Tory "community care" reforms of 1991, and has continued with the closure of most NHS geriatric beds: 70 percent of all long term beds are now in the private sector. 40 percent of NHS geriatric beds have closed since 1991, with another 2,500 closed since Blair was elected.

Labour’s much-vaunted hospital building programme is almost entirely funded by private sector cash through the Private Finance Initiative, delivering a thumping 12%-plus annual return to investors – at the expense of NHS budgets for patient care.

PFI schemes already under way are predicted to add up to a massive £7 billion of private investment by 2007, costing NHS Trusts £2.1 billion a year in rental payments for these new, privately-owned hospitals.

Most early PFI schemes slashed numbers of front-line acute beds by 20-40 percent. One example is the plan under way in Worcester, which involves a loss of around 30% of acute beds across the county, and triggered the closure of most in-patient care at Kidderminster Hospital. Popular local anger at this has now lost Labour the Wyre Forest constituency to hospital campaigner Richard Taylor.

Stung by widespread criticism of PFI as a destroyer of beds at a time when Labour’s own National Beds Inquiry found that more beds were required, Milburn has said that future PFI plans must at least maintain existing bed numbers.

The result of this has been that the cost of new, revised PFI hospital plans has been spiralling ever higher, creating long-term problems for the Trusts in meeting their monthly rental payments.

Ministers had previously argued that clinical staff (doctors, nurses and other professionals) would not be transferred to private contractors under PFI deals, as has happened to non-clinical support staff in the first wave of PFI hospitals. But if new "health factories" are built and managed by the private sector, as the manifesto proposes, it seems certain that the clinical staff there will be private sector employees.

Since the election a new deal between ministers and health unions has been trumpeted, covering hospitals faced with PFI.

The government has now agreed that non-clinical staff in these hospitals should not be transferred to private contractors, but remain NHS employees. This was exactly what the Dudley Hospital strikers had demanded – and been refused – throughout their long battle over PFI. It is now clear that they won the concession for others, even though they couldn’t get it for themselves.

UNISON has declared this latest deal a victory, but insisted that it will continue to oppose PFI as poor value for money.

But the new policy will only apply to PFI deals that have not yet been signed – and will have no relevance to the tens of thousands of hospital support staff who are already employed by private contractors.

It is not yet clear whether the private firms bidding for PFI deals will be prepared to forego the additional profit stream which they have drawn from the provision of support services: excluding these services may simply mean that they bump up the monthly rent they charge for use of the new hospital.

Another important area of privatisation needs to be noted.

The Health and Social Care Act rushed through the Commons just before the election includes provision for a new private limited company NHS LIFT, which will be given the task of investing in new premises to be leased to GPs and primary care services.

Milburn has talked of this injecting £1 billion into primary care over four years – but only £175m of this will be government money, the rest coming from the profit-seeking private sector.

As this scheme takes effect it will not only be showpiece hospitals but local health centres and surgeries that begin pumping cash from the NHS budget into the banks and big business.

But the same new legislation also sets up Care Trusts, which will cover both social services and health care, and play a key role in the provision of "intermediate care" which is a central theme of the NHS Plan.

While all NHS treatment has since 1948 been available free at point of use, social services have always been subject to mans-tested charges, and the scale of these charges have increased as successive governments have imposed tighter cash limits.

The new Act will mean that the cost of nursing care will be provided free of charge, but government guidance urges the NHS to remodel services, with the effect that more and more care will potentially be subject to means-tested charges.

The Department of Health circular on intermediate care says that the first episode of care will be free at point of use, and "typically last no more than six weeks." But further episodes of care should be much shorter, and user charges will apply to the housing and living costs of "personal care".

Huge question marks hang over the definition of "personal care", which potentially covers many of the tasks of daily living. And for the first time a health service body, the Care Trust, will have to decide on the imposition of charges for care.

Meanwhile the whole structure of continuing care services is under threat as private home operators vote with their feet, closing and selling off nursing and residential homes because they can’t make enough profit from social service placements which are subject to rigid limits on the weekly fees paid for each placement.

Many home operators were paying such abysmal wages that they were hit hard by Labour’s minimum wage legislation. A recent King’s Fund report shows that up to a million care home workers are being expected to care for elderly patients on £5 an hour or less. Two thirds of them have no relevant qualifications.

Even poverty wages have not enabled many operators to make big enough profits, and 15,000 care homes closed last year, leaving a mounting crisis in many localities, as frail elderly patients remain in front-line hospital beds for lack of nursing home places to care for them.

In Birmingham alone more than 200 patients are believed to be in the city’s hospital beds after cuts in council care for elderly people discharged from hospital.

All the evidence suggests that Labour voters supported Blair despite, and not at all because of Labour’s plans for privatising health and social care. A poll by Rasmussen Research for the Independent at the end of May showed that even if the NHS paid all the costs of care, only 19 percent thought private companies should run health services, while a massive 81 percent were against.

A similar result emerged from a survey conducted for UNISON just two days before the election, and the union has correctly stepped up its "Positively Public" campaign in opposition to further privatisation and PFI. Even the normally docile Royal College of Nursing, which has previously remained largely indifferent to privatisation and PFI joined the NHS academics and professionals and the trade unions warning of the implications of Labour’s plans.

Bill Morris of the TGWU, Roger Lyons of MSF and John Edmonds of the GMB have joined the chorus of union leaders trying to warn Blair off his drive to privatise: but they have not been willing to pledge action to challenge a new onslaught by New Labour.

The mood of union leaders is perhaps best summed up by TUC leader John Monks, who is clearly worried that some of these union leaders may find themselves propelled into action in the same way as the rail and postal unions, creating the biggest clash so far with New Labour.

Monks even invoked the spectre of another "winter of discontent" – in his effort to persuade union bosses to cool their rhetoric.

It’s up to activists within the unions and campaigners defending our public services to ensure that every inroad by the private sector is challenged. Ministers have been forced into retreats on a number of issues: they can be forced back again.