NHS Finance

– in the House of Commons at 3:32 pm on 15th November 2005.

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Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health 3:44 pm, 15th November 2005

I beg to move,

That this House
supports the provision by the NHS of comprehensive, high quality health services, based on need and not ability to pay;
notes that, despite unprecedented resources provided to the NHS, NHS trusts were over £600 million in deficit in 2004–05 and predicts deficits approaching £1 billion this year;
believes that these deficits threaten the delivery of NHS services, through service cuts, freezing of staff vacancies and redundancies, bed closures and the closure of services in community hospitals;
further believes that the uncertainty caused by proposed primary care trust restructuring should not be used to obscure responsibility for financial recovery and service continuity;
wishes to see resources reach front-line healthcare providers;
regrets the lack of savings in NHS overhead and administration costs;
and calls on the Government to intervene to ensure that the long-term interests of patients are not damaged by short-term financial decisions.

At the heart of the debate is a series of questions. Why, when the Government are spending unprecedented amounts of money on the NHS, are more NHS hospitals and trusts in deficit? Why are services threatened? Why are jobs being lost, and why are community hospitals closing?

In this debate, we will investigate why those things are happening. What are the consequences? We will argue that the long-term interests of the NHS and patients must not be sacrificed to short-term financial decisions.

Let us start with the facts. In the financial year 2004–05, 90 primary care trusts, 65 NHS trusts and a number of NHS foundation trusts—the total has yet to be declared, but I believe it to be 12—were in deficit. The combined deficits amounted to £630 million, even though the Department of Health set control totals in the latter stages of the 2004–05 financial year to limit the overall deficit.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I want to get the facts on the record, and then I shall give way.

The Department of Health aimed for a control total of £70 million. Three months after the end of the financial year, the Secretary of State was questioned on this matter and told the House that the net NHS deficit was £140 million. Despite pressure from Opposition Members, she did not acknowledge or admit that total overspends amounted to more than £700 million.

Shortly after the Secretary of State admitted that the net deficit was twice as large as the control total, the permanent secretary at the Department of Health revealed that the net deficit was £250 million. The figure would have been much higher but for the fact that strategic health authorities had underspent their budgets by some £372 million. To do that, I understand that they raided the budgets of the work force development confederations—the very same budgets that the Labour party, in the general election campaign, accused the Conservatives of wanting to abandon as part of our proposals to scrap SHAs.

Photo of Stephen Hesford Stephen Hesford PPS (Rt Hon Baroness Amos, President of the Council), Privy Council Office

The hon. Gentleman quoted a figure of £600 million. The NHS Confederation reckons that the net figure is nearer £250 million. How does he account for the difference?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

The hon. Gentleman clearly believes the Government's propaganda. I have just explained all this, but I shall do so again. The net deficit in the NHS was just over £250 million because SHAs underspent their budgets—a large part of which was to be devoted to the work force development confederations—by £372 million. Without that underspend, the deficit across the NHS would have totalled £630 million.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I will, and perhaps this time the hon. Gentleman will explain why Arrowe Park hospital is facing deficits and closing beds.

Photo of Stephen Hesford Stephen Hesford PPS (Rt Hon Baroness Amos, President of the Council), Privy Council Office

I shall deal with that when I come to make my speech, but I can tell the hon. Gentleman that he is wrong—[Interruption.] Mr. Speaker, the Opposition do not want to listen. However, when Mr. Lansley quotes a figure of £600 million, is he not simply exaggerating?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

There are limits to how many times I can repeat the same figures, even if the hon. Gentleman simply fails to understand them. If he comes to a debate on NHS finance, he should at least take the trouble to understand the subject. The Secretary of State will admit, if she cares to, that the gross overspends reported in the NHS accounts—and I can go through them for the hon. Gentleman, if he wishes—were £630 million. If the right hon. Lady wants to deny that figure, I shall give way to her now. [Hon. Members: "Come on!"] As I expected, the Secretary of State makes no move to respond. Let us get some more facts on the record.

Three years ago, six SHAs were in deficit overall. Two years ago, seven SHAs were in deficit, and last year the total was 12. Half way through this financial year, 21 out of 28 SHAs were predicting deficits. Stephen Hesford seems fond of quoting the NHS Confederation. In its otherwise obfuscatory briefing, it did at least admit that deficits this year are expected to be worse than last year.

Photo of Mike Penning Mike Penning Conservative, Hemel Hempstead

If the Secretary of State and Opposition Members do not believe our figures, perhaps they will believe Unison's. My friends at Unison have supplied us with a nice document that tells us that the deficit is £200 million in the eastern region alone. Unless the rest of the country has a tiny deficit, someone is telling porky-pies.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I am grateful to my hon. Friend for that point. Indeed, in Norfolk, Suffolk and Cambridge, the strategic health authority predicted a £92 million deficit in its area alone.

Two years ago in 2002–03, there were 71 deficits. In 2003–04, there were 106 deficits and by 2004–05 there were 167 deficits, including foundation hospital trusts. As I said this year, the projected deficit is £1 billion, far in excess of last year's. The Department of Health has already set control totals approaching £350 million, but one has little confidence in its ability to exercise financial control. The chief executive of the Department, in a memo leaked last week to the Health Service Journal, said that the NHS is

"tightening financial discipline after a spurt of growth in which increased income sometimes allowed people to forget good financial discipline."

That is from the accounting officer for the Department of Health. It is little wonder that three months after the end of the financial year the Secretary of State could be nearly 100 per cent. out on the out-turn figures for NHS finances.

NHS trusts have a statutory duty to break even, which is generally interpreted as allowing one financial year to be taken with another, but at this rate they will have to put two or three financial years together. We are now in the fourth year of rising deficits. Many PCTs and trusts have breached their requirements to live within resource limits or external finance limits. In several parts of the country, there is a risk of financial collapse.

Photo of Tim Yeo Tim Yeo Conservative, South Suffolk

Is my hon. Friend aware that Suffolk West primary care trust proposes savage cuts in my constituency, including the closure of Walnut Tree and St. Leonard's hospitals in Sudbury with the loss of 68 beds? The cuts will be made at a time when Suffolk county council's social care budget is under extreme pressure and facing cuts, the population of the town is increasing sharply and beds in West Suffolk hospital—the district hospital that serves the area—are also being cut. The PCT's announcement of the cuts came just three months after it had approved the construction of a new replacement community hospital in Sudbury, the announcement of which came—conveniently—just before the general election. Today, Sudbury's existing hospital is to be closed, its new hospital has been cancelled and no replacement community services will be in existence before the cuts are made.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I know that my right hon. Friend has been an active and tireless advocate for his constituents on the issue of Walnut Tree and St. Leonard's hospitals. The PCTs in Suffolk suffered large deficits. If memory serves, Suffolk Coastal and Suffolk West PCTs together were £18 million in deficit. As I said to my hon. Friend Mike Penning, Norfolk, Suffolk and Cambridge together face a very large deficit. The risk of financial collapse certainly applies to the Suffolk health economy and my right hon. Friend is right to be concerned about it.

Photo of Peter Ainsworth Peter Ainsworth Conservative, East Surrey

While discussing the terrible deficits that have built up around the country—the Surrey and Sussex trust has an accumulated deficit of some £67 million—will my hon. Friend also reflect on the fact that the problem is not only about numbers? It is about cancelled operations and personal anxiety. It is about people having to make inconvenient travel arrangements to go further afield for their operations. It is about human misery and a failing health service. No number of letters from the Surrey and Sussex strategic health authority saying that it has been a huge success since its formation will persuade people who are suffering under this Labour Government that the health service is not in meltdown in Surrey.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

My hon. Friend is right: his area, Surrey and Sussex, has serious financial problems and he is right to say that they will manifest themselves in harm to patients. That is precisely why we say to the Government today that before the consequences of their decisions are played out in this financial year action must be taken to avoid damage to patients and indeed to their long-term interests, because often the services being cut could be part of a sustainable and successful long-term health system.

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

The hon. Gentleman is setting out for the House his view of the facts, but will he look at some other facts? For example, when the previous Conservative Government introduced the private finance initiative why were no hospitals built? Can he explain what the impact of the expenditure was when they actually were built, and will he explain why the hospital in Halifax was not built for more than two decades? Is he now suggesting that the hospitals that were built should not have been built?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

Given that the first flagship hospital to be built under the Government's PFI scheme was in Norwich, the hon. Lady might like to ask her colleagues there about the financial consequences of the way in which that project was undertaken. I know that we needed to build hospitals and it is right to do so, but to do it, as the Government did, in a way that transferred little risk but large amounts of profit through PFI, is not necessarily the right way.

Photo of Edward Balls Edward Balls Labour, Normanton

Like many Labour Members, I am pleased that Opposition Members are now concerned about standards of patient care and the financial state of the NHS, but if my memory serves me right, £2 billion would have been diverted from NHS trusts by the manifesto that all Opposition Members supported, through the patient's passport. Was that the right policy? Did the hon. Gentleman support it then, and why does he not support it now?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I thought we would get something better from the hon. Gentleman.

Photo of Julie Kirkbride Julie Kirkbride Conservative, Bromsgrove

I want to help my hon. Friend by responding to the remarks made by Kali Mountford. In my constituency, we face cuts of between £20 million and £30 million at our local hospital, which threaten the accident and emergency department. One of the factors that makes it difficult to balance the books in Worcestershire's health economy is the cost of the PFI hospital in Worcester, one of the first hospitals to which the Government signed up. In the words of the chief executive of our local trust hospital, the hospital is "relatively expensive". When I heard the Under-Secretary of State for Health, Caroline Flint, talking about the Worcestershire acute trust this morning, it occurred to me that there might be some panic in the Department of Health about the true cost of the PFI hospitals to which the Government have signed up.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I am grateful, Mr. Speaker. I am also grateful to my hon. Friend Miss Kirkbride, who made an important point. I visited Redditch hospital and I know how important it is to the people of Redditch and the surrounding area that they have access to services, including the accident and emergency service at the hospital.

Several hon. Members:


Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I want to make some progress, but I will give way to my hon. Friends in a moment.

As my hon. Friend Mr. Ainsworth said, we need to think about the consequences—

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

What are the implications of those deficits?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

Important as it is to understand the finances of the NHS, it is more important to understand the consequences of the deficits. In September, the British Medical Association conducted a survey, which found that three quarters of trusts faced a funding shortfall; one in three trusts were planning to reduce services and almost half were freezing recruitment, including the recruitment of medical staff. A quarter of the trusts were considering redundancies, including medical staff—for example, clinical psychiatric staff in Oxfordshire.

The BMA said:

"Something is going terribly wrong when patients pay the price for those financial problems and the Government's lack of joined-up thinking".

Photo of Gregory Barker Gregory Barker Shadow Spokesperson (Environment, Food and Rural Affairs)

My hon. Friend may be interested to know that patients are already paying a price in East Sussex. In the East Sussex Hospitals NHS Trust, which is almost £5 million in deficit, not only two weeks ago did Conquest hospital start closing wards ahead of the winter, but it has now told all new out-patients that no one will be seen this side of Christmas and that patients must travel up to 30 miles. That is a damning indictment of not just the current financial crisis but a health funding formula that diverts funds from constituencies such as mine in the south-east to Labour's friends in the north.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

Yes, I understand exactly the point that my hon. Friend makes. South Cambridgeshire primary care trust, which covers most of my constituency, gets £888 per head this year, while the PCT in the Secretary of State's constituency gets £1,131.

The Royal College of Nursing published a survey this month that showed that up to 3,000 staff in England would lose their jobs, including at least 1,000 nurses.

Photo of Ian Austin Ian Austin Labour, Dudley North

Given the hon. Gentleman's complete failure to answer the question posed by my hon. Friend Ed Balls, may I ask him again whether he supported the patient's passport and the Conservative pledge to remove £2 billion from the NHS at the election? [Interruption.] I recall Conservative Members voting against the national insurance increase that has delivered billions of pounds for the health service. Will he tell me what the effect of blocking that increase would have been on NHS finance?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

Those who observe or read the report of the debate will reflect on the fact that Labour Members are not prepared to stand up and defend their Government's policies.

We are in the business of examining what is going on in this financial year and what are the realities across the NHS. One of the realities of those deficits is the closure of NHS beds. Let me remind the Government. The Secretary of State will recall, no doubt, that the NHS plan said five years ago that there would be 7,000 extra NHS beds by 2004. In fact, between 2000 and 2004, the number of NHS beds fell by 4,518.

Photo of Bob Spink Bob Spink Conservative, Castle Point

Does my hon. Friend share my concern that, during the Labour Government's term in office, 111 beds have been cut from Southend and Basildon hospitals, which serve my constituency, and that the Minister responsible refuses to give me an undertaking to rule out further cuts in hospital beds there?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

My hon. Friend gives a figure above and beyond the numbers that we have been able to establish in the survey that we have undertaken of possible bed closures across the country. That figure adds to those that I was about to give the House.

Photo of Geoffrey Clifton-Brown Geoffrey Clifton-Brown Opposition Deputy Chief Whip (Commons)

As my hon. Friend knows from his excellent visit to Tetbury hospital, four cottage hospitals in my constituency face severe cuts. Is he aware that the Government made two fundamental pledges in their manifesto at the last election: to strengthen our national health service and to increase the number of intermediate care beds? Is it not about time that the Government allocated whatever resources they have got for the health service more fairly?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

Yes. I did indeed visit Tetbury hospital in my hon. Friend's constituency. Given the valuable work done there and the opportunity for patients to be sent closer to home for further rehabilitation after operations, in refurbished and well-appointed small wards, I was astonished that the PCT proposes to close them at the end of December. That seems outrageous and he was right to receive a substantial local petition on the subject.

I want to pick up the thread of where we are with the number of beds. Our analysis—clearly, the figure is greater than we knew—is that 2,500 additional NHS beds are threatened with closure this year in the 43 trusts that we identified from our survey. In the five years since the publication of the NHS plan, instead of 7,000 more hospital beds, there will be 7,000 fewer. Five years ago, we had 186,000 beds in the NHS and 159,000 administrators. By the end of this year, we will have fewer than 180,000 NHS beds, yet more than 211,000 administrators.

What has been going on? Why have these deficits occurred? It is partly because the Government have been decreeing the cost structure of the NHS and costs have been rising dramatically. About 80 per cent. of the additional cash provided for the NHS has been consumed by spending pressures: pensions indexation; National Institute for Health and Clinical Excellence guidelines; the consultants' contract, the cost of which the Government underestimated; the general practitioner contract, the cost of which was substantially underestimated; the drugs bill; and the implications of the working time directive, which means that many more medical staff must be employed to undertake the same work as previously. Additionally, £500 million extra has been spent on "Agenda for Change" and information technology costs have been higher than predicted. I am reliably informed that, if the NHS tariff had had to incorporate all the additional spending pressures last year, it would have increased by more than 8 per cent. All the extra cash thus would not have bought anything extra, which is interesting because that is precisely what happened. We had all the extra cash, but there was no increase whatsoever in the number of elective operations—that is, planned operations—carried out in NHS hospitals between 2003–04 and 2004–05.

Photo of Grant Shapps Grant Shapps Co-Chair, Conservative Party

Has my hon. Friend included in the category of wasted money the amount spent on consultants? My East and North Hertfordshire NHS Trust recently called in an outside consultancy firm at a cost of more than £300,000. The upshot was a recommendation to close the children's accident and emergency department, the blue light A and E service that is for everyone, all maternity services and all facilities for elective operations. The general hospital has been turned into nothing more than a community hospital. That is where the money is going.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I have every sympathy with my hon. Friend. We visited that hospital together and I entirely understand his point.

Management should be effective. Monitor has employed some management consultants and, frankly, that spending represented better value for money than the amounts spent year after year on the strategic health authorities that are supposed to be responsible for performance and financial management in the NHS, but have palpably failed to deliver on that responsibility. Under the Government, we get more management, but not better management. There are now 52,000 more administrators than there were not in 1997, but in 2000.

Photo of Jim Cunningham Jim Cunningham PPS (Mr Mike O'Brien, Solicitor General), Law Officers' Department

Does the hon. Gentleman recall that one reason why we had hospital closures was the lack of investment in doctors and consultants and the fact that nurses were made redundant? More importantly, he is missing this point: we do not hear about many cases of people on trolleys because there are no beds for them in hospitals any more.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

We are debating the NHS as it is today, not the hon. Gentleman's representation of how it might have been in the past.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I have more to say and I do not want to intrude on the time of hon. Members who want to speak.

In four years, the number of administrators has increased by a third, which is twice the rate of increase in the number of doctors and nurses. The cost of salaries for administrators—not the other bureaucratic costs imposed on the system—rose over those four years by £1.3 billion in real terms. However, half that amount represents the deficit in the NHS. If the cost of bureaucracy in the NHS had been held down over the past four years, the money would have been available to enable many of the deficits to have been met and avoided.

As my hon. Friends have made clear, the consequences of the situation for community hospitals are dramatic. We have a list of 90 community hospitals that are threatened. However, the Government said during the election that they wanted to build new community hospitals. The NHS plan said that they wanted more intermediate care beds, but community hospitals and intermediate care beds are being closed.

Photo of Ann Winterton Ann Winterton Conservative, Congleton

Is my hon. Friend aware that it is not only community hospitals that are under threat? I am the greatest supporter of community hospitals, and the Congleton War Memorial hospital gives a fantastic service, but district general hospitals are now under threat. If accident and emergency, children's and maternity services are stripped away from a district general hospital, one has only a community hospital. I represent a rural area from which people will have to travel to Stockport, Leighton and north Staffordshire for treatment. Given that the Government are trying to get us all off the roads, does he agree that that seems stupid?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I do agree. My hon. Friend will no doubt know—I cannot see any Members of Parliament from north Staffordshire here at the moment—of the difficulties that the university hospital at north Staffordshire itself faces and the threat to services there.

The issue of community hospitals is a classic illustration of precisely the point of this debate. Primary care trusts that are running deficits are trying to deal with the implications of payment by results and paying for the activity in hospitals—principally the emergency and unplanned activity—while at the same time having to pay enormous amounts through the GP contract. Their solution is to cut the budget of the one part of the scene that they control. That is often the contracts with community hospitals. That is fool's gold—it is penny-wise and pound-foolish—because in the longer run, we will have less accessible services and less appropriate services clinically. Patients should be discharged from the acute district general hospitals to relieve pressure there and would be seen more appropriately in community hospitals.

Photo of Nick Hurd Nick Hurd Conservative, Ruislip - Northwood

My hon. Friend may be aware that Hillingdon primary care trust forecasts a deficit of £31 million in 2005–06. It admits that the only solution is substantial closure of beds at Hillingdon hospital. In the meantime, it tinkers with cuts to services which, in its sensitive way, it deems low priority, but which are highly valued by those who are about to lose them. Are my constituents wrong to feel angry at the amount of time and money that the same strategic health authority spent on the Paddington health campus fiasco?

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

My hon. Friend is right: his constituents should feel angry at the fact that £14 million has been wasted on consultancy and the like on the Paddington health campus scheme. In addition, the National Audit Office report suggested that the opportunity cost of that scheme was £100 million. Where was the statement from Ministers? Which Minister told the House about that? The Minister formerly responsible for that, the new Secretary of State for Work and Pensions, did not even have the courage to give an interview to the independent review into the Paddington health campus scheme, such is the complete absence of accountability on the part of this Government.

I want to mention two more things. Is there any answer to all this in the primary care trust restructuring that the Government have proposed? There is no answer at all. We know what is really going on. There are deficits and difficult, sometimes painful and wrong-headed decisions to be taken, often without the benefit of realistic or real consultation with local people, but lo and behold, in a year or two, all the organisations that take those decisions will disappear and be submerged into a bigger organisation. There is everything to be said for cutting bureaucracy in the NHS—we recommended that, but we were clear at the time of the election about the future functions of PCTs. This Government—I do not know where the Secretary of State was when the announcement was sent out, for which she has apologised—dictated changes in the form of primary care trusts but at no point said what their functions would be. There has been utter confusion since.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I will give way for the last time to my good friend and then I must conclude.

Photo of James Gray James Gray Conservative, North Wiltshire

My hon. Friend is right about the re-creation or re-amalgamation of PCTs. In Wiltshire, we have re-created something that looks very much like the Wiltshire health authority, which I rather welcome, but on top of that we have something called the Avon, Gloucestershire and Wiltshire strategic health authority—what it is for, I know not—which spends huge sums on bureaucrats, all of them driving BMWs, and on a posh office in my constituency. What is happening? They are closing Malmesbury hospital as a result—closing a hospital to spend the money on admin.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

My hon. Friend is right.

We have a great deal to do. We need to cut bureaucracy. We need proper risk-sharing agreements between PCTs and hospitals about what is to be done where activity rises and payment by results applies. We need integrated commissioning of emergency care. We need the Government to stop the central imposition of costs through national pay contracts. The working time directive needs to be renegotiated. More than a year ago, the Government promised to renegotiate it in Europe, but we have not heard anything about it since. Most of all, however, we need a Government who do not believe that, while controlling NHS costs and imposing 80 per cent. of the additional cost pressures on primary care trusts, they can at the same time wash their hands of that responsibility which, they say, belongs to local PCTs.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

I am afraid that I am about to conclude.

The Government must not be allowed to wash their hands of the deficits that have arisen across the NHS. Resource allocation means that health economies in London, as we heard from my hon. Friend Mr. Hurd, in the south-east, parts of the south-west, East Anglia and parts of the north are in crisis. Hospitals across the country are struggling with rapidly rising cost pressures. Rising emergency attendances are crowding out elective activity in NHS trusts. At the same time, however, the Department of Health top-slices funds for take-or-pay contracts with private sector providers, who are paid regardless of whether patients are referred to them.

Unrealistic and absurd assumptions by Ministers have led to serious underestimates of the cost of consultant and GP contracts. A former health adviser to No. 10 says that too many Government contracts did not incentivise productivity improvements. Small wonder, then, that productivity in the NHS declines every year. PCTs are caught between the rock of rising hospital costs and the hard place of GP contracts and out-of-hours costs. PCTs are cutting services and closing community hospitals and mental health services, as has happened in my own constituency, thus threatening the long-term viability of community services. Short-term cuts threaten the long-term interests of patients. Instead of shifting the blame, the Government must recognise the scale of the problem, intervene to resolve the deficits, and prevent permanent damage to the NHS this year and next. I commend the motion to the House.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health 4:17 pm, 15th November 2005

I beg to move, To leave out from "House" to the end of the Question, and to add instead thereof:

"welcomes the Government's record levels of investment in the National Health Service, with expenditure set to rise to over £92 billion by 2007–08; notes that by this date £70 billion, more than ever before, will be going to the NHS front line;
congratulates the Government on delivering investment and reform, leading to historic improvements to NHS services and capacity, reducing waiting times to their lowest in nearly a generation, from over two years to a maximum of six months, and to a maximum of 18 weeks by 2008, employing nearly a quarter of a million more NHS staff than in 1997, including 78,700 more nurses and 27,400 more doctors, and undertaking the largest hospital building programme in the history of the NHS, including investing £100 million in a community hospitals programme;
further notes that the NHS has achieved overall financial balance in each of the past four years, and last year carried a deficit of around only 0.4 per cent. of total resources;
compares this with the record of the previous Government which left the NHS with a £460 million deficit in 1996–97 which amounted to almost 1.5 per cent. of total resources;
and agrees that, given the record increases in health funding available coupled with the strengthening of Primary Care Trust commissioning, all NHS organisations should be able to live within the resources available to them and to provide excellent services to their populations."

This morning, I had the enormous pleasure of accompanying my hon. Friends the Members for East Ham (Mr. Timms) and for West Ham (Lyn Brown) to the official opening of the NHS gateway treatment centre in Newham, which is one of the most diverse communities in the country, with the UK's youngest population. It also has some of the most pressing health needs. Now, however, the new NHS treatment centre, which is part of the growing Newham health village, is offering outstanding care to NHS patients. There is a wonderful new environmentally sustainable building, which is the result of a £17 million investment with which we helped. The centre offers patients the choice of three-bed ward or a single-bed room. It was designed with clinicians to speed up care and recovery.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

No, I will finish my example before giving way. I know that the hon. Gentleman has received excellent health care and will readily give way to him in a moment. [Interruption.] If Opposition Members will permit me, I want to say a little more about what the staff at the gateway centre are doing. It was a pity that Mr. Lansley, who spoke at some length, did not give one word of thanks to our outstanding NHS staff.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

The Secretary of State knows perfectly well that this whole debate is in the interests of NHS staff. However, I would like to pay tribute to the staff of hospitals in Newham, because Newham general hospital is the successor institution to the East Ham memorial hospital, where my father ran the pathology laboratory for nearly 30 years.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I am glad that the hon. Gentleman has now made that point. The staff at the Gateway centre, led by the consultant surgeon Mr. Nigel Fieldman, are working in new and better ways. They are making much greater use, for instance, of nurse practitioners and operating department assistants. The result is that a patient coming in for a hip replacement or some other elective procedure, who, in the old hospital, would have faced an average stay of 10 days, now has an average stay of just five days, and the staff believe that they can get that down even further.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

Before I give way, I want to pay tribute to the outstanding work of all the staff at the Gateway centre, but in particular to Mr. Fieldman, who is due to retire shortly and will leave behind him a centre that is a shining example of the future of our national health service.

I will give way first to the hon. Gentleman with the injury.

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

Some hon. Members may have noticed that the sling was off last week. I was a poor patient and had to put it back on this week. I am delighted to hear of the reaction of staff in Newham at being provided with decent facilities with which to look after their patients. We only wish that were true across the country. We wish that the right hon. Lady would speak to the staff in Withernsea and Hornsea in my constituency and tell them about decent facilities. They want them there so that people can have better care in east Yorkshire, not just in central London.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

It is a great pity, then, that the hon. Gentleman's party voted against the national insurance increases that are delivering the record levels of investment that are paying for improved facilities right across our country.

Photo of Peter Bone Peter Bone Conservative, Wellingborough

I wonder whether there a mistake in the Government's amendment. It states that they are

"reducing waiting times . . . to a maximum of six months".

Is that an error? In Wellingborough only two weeks ago someone showed me that they were being asked to wait for 40 weeks for treatment, and two other people were being asked to wait 52 weeks. To me, that is more than six months.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

Perhaps the hon. Gentleman will let me have details of that.

By Christmas, we will have a maximum waiting time of six months for an operation—six months, compared with over 12 months, in many cases over 18 months and in some case 24 months under the Government whom the hon. Gentleman supported.

The Gateway centre is giving its patients what we want for all patients: the best possible health and the best possible health care, with the best value for money. It is particularly relevant to the debate that both the hospital trust and the primary care trust are achieving financial balance.

Photo of Ian Austin Ian Austin Labour, Dudley North

Given the Opposition spokesman's pathetic refusal to reply to the questions that he was asked earlier, can my right hon. Friend give her estimate of the effects of cutting NHS expenditure by £2 billion, which was the pledge in the patient's passport, and of the effects on the NHS of cutting the national insurance increase, which the Opposition parties voted against? Can she explain what effect that would have on NHS finances and services?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

My hon. Friend makes an important point. [Interruption.] One estimate of the impact of taking out the £1 billion to £2 billion that the Opposition promised—or should I say threatened—at the general election to invest in their patient's passport would be a reduction by 9,000 consultants in the staff of the NHS, a massive reduction in care for NHS patients and a devastation of the NHS right across the country. [Interruption.]

Photo of Nigel Waterson Nigel Waterson (Also PPS To the Chairman of the Party), Work & Pensions & Welfare Reform

The right hon. Lady has been generous in giving way. Now that she has visited Newham, will she come 60 miles south to Eastbourne, where she will find a hospital trust in crisis, with the worst bed blocking in the entire NHS, people being turned away from out-patients and the trust being required to make £17 million of cuts in the current year?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

In a moment, I shall discuss what is being done to deal with deficits, too many of which have built up over several years in health communities that have spent beyond their means, even though those means are significantly bigger than ever before.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I will not give way, because I intend to make progress.

I want to be fair to the Opposition, who have recognised in their motion that there has been "unprecedented" investment in the NHS in the past eight years. Eight years ago, we inherited a wholly inadequate NHS budget of just £34 billion, which we doubled to nearly £70 billion in 2004–05. By the end of 2008, the NHS budget will be more than £92 billion, nearly treble what it was when we entered office, which reflects the strength of the economy under the prudent economic policies delivered by my right hon. Friend the Chancellor. Conservative Members may claim that they support that extra investment, but they voted against the means to pay for it.

Photo of Edward Balls Edward Balls Labour, Normanton

In my constituency, we have more than 1,000 extra doctors and nurses as a result of extra investment since 1997. [Interruption.]

Photo of Edward Balls Edward Balls Labour, Normanton

I am grateful for your support, Mr. Speaker. Will the Secretary of State reassure my constituents that this Government will never introduce a patient's passport? Does she think that there is any prospect of a cross-party agreement to rule out such a proposal at future elections?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

My hon. Friend makes an interesting proposal. I can happily give him the reassurance that he seeks: we will never take money out of the NHS budget to subsidise private health care for the few, which is what the patient's passport involved. I am sure that Conservative Members will want to consider his proposal for a cross-party agreement before the next election.

I look forward to Conservative Members answering this question, which the hon. Member for South Cambridgeshire has refused to answer: what is Conservative party policy on the patient's passport?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

Perhaps the hon. Gentleman will tell us.

Photo of Mark Pritchard Mark Pritchard Conservative, The Wrekin

The Secretary of State has said that record investment has gone into the NHS, but my constituents are asking why the Shrewsbury and Telford Hospital NHS Trust has a £14 million deficit and why they face huge cuts to local hospital services despite paying record national insurance contributions. I was going to raise a point of order, but I will not. [Laughter.]

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

The hon. Gentleman showed great discretion at that point in his intervention.

In a moment, I will discuss the underlying causes of the deficits in a relatively small minority of NHS organisations. [Interruption.]

Photo of Michael Martin Michael Martin Chair, Speaker's Committee on the Electoral Commission, Speaker of the House of Commons, Chair, Speaker's Committee on the Electoral Commission

Order. I appeal again to the House for calm. We must allow the speech to develop, but it is far too noisy.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

Thank you, Mr. Speaker.

As we consider the challenges ahead, it is worth remembering—we remember this, and so do our constituents—the size of the task that we faced eight years ago, when, as Derek Wanless found in his recent report, the cumulative underfunding of the NHS amounted to a staggering £267 billion by 1998. That was the scale of the challenge that we faced eight years ago and, as we look back over those eight years, we can see how much better services are within the NHS. But there is still even more to do. The challenges that lie ahead include dealing with the financial deficits that exist in about a quarter of NHS organisations.

At the end of the financial year 2004–05, the NHS as a whole had a deficit of around £250 million. That is less than half of 1 per cent. of total NHS resources. I would prefer—the whole House would prefer—to have no deficit at all, and in a moment I will explain how we are going to get rid of it. However, let me remind hon. Members of a fact that the hon. Member for South Cambridgeshire unaccountably failed to mention: in 1996–97, when the NHS annual budget was only £33 billion, the overall deficit was £460 million, which is almost 1.5 per cent. of a total budget that was, of course, far smaller.

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

My right hon. Friend mentioned value for money. In that context, I offer her my personal thanks for a very helpful intervention in advising primary care trusts about the prescription of Herceptin. My constituent, Karen Gibson, starts her treatment today. Such new drugs are expensive in the early years of their administration and set us a challenge in achieving value for money in terms of the investment that has to go into an individual's health care. Should we not consider health expenditure in the round, with the outcome that patients get better?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

My hon. Friend is absolutely right. The measure of all this is in getting the best possible health for patients with the best possible value for money. Thanks to the wonders of medical science, many new drugs and therapies such as Herceptin are becoming available. Some of those are very expensive, and we must ensure through our reforms that we get the best possible value for money for every pound of taxpayers' money that we invest in the NHS.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I had better give way to the hon. Member for South Cambridgeshire, as he may wish to answer the question that he was posed earlier.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

In the expectation that the right hon. Lady would talk about the NHS deficit, I asked the National Audit Office for the figures on the cumulative deficit year by year. In 1997–98—the first year of the incoming Labour Government—the cumulative deficit was £26 million; in 2003–04, the last year for which figures are available, it was £276 million; and this year it is likely to be more than £520 million. Under this Government, the cumulative deficit has risen from £26 million to more than £500 million.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I suspect that the hon. Gentleman is muddling up the NHS deficit with the overall picture including the Department of Health. The figures that I have are very clear. In 1996–97—in other words, the last year of the hon. Gentleman's Administration—the overall NHS deficit was £460 million.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I am going to make some progress.

In the last financial year, nearly three quarters of NHS organisations ended the year in balance or with a surplus. A minority of trusts had a deficit, half of which was in just 5 per cent. of NHS organisations—nine primary care trusts and 22 hospitals and mental health trusts.

Photo of Jim Cunningham Jim Cunningham PPS (Mr Mike O'Brien, Solicitor General), Law Officers' Department

We are going to get a new hospital in Coventry. It is in the process of being constructed, and I recognise that there has been a lot of investment in it. However, I am concerned about University Hospitals Coventry and Warwickshire NHS Trust. I wrote to it five weeks ago asking it to justify a £7 million deficit, but still have not had a reply. There are press reports that 250 health workers are likely to lose their jobs, which could lead to a problem with cancer treatment. Can my right hon. Friend sort that out?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

We are ensuring that every hospital or trust that experiences a deficit problem has proper support to sort out its finances and continue to improve its clinical services. I shall say a little more about that shortly. I shall certainly ensure that my hon. Friend receives a reply to his letter. I was glad that he mentioned the new hospital in Coventry—it is one of 138 hospitals that have been modernised, rebuilt or are under way.

Photo of Julian Lewis Julian Lewis Shadow Minister (Defence)

The Secretary of State has spoken a great deal about value for money. Does she accept that community hospitals are great value for money? Does she agree that the deficit is not the result of the costs of community hospitals? Does she accept that when she boasts in the amendment about a programme of investment in community hospitals, it is hard to square that with the more than 90 community hospitals that are at risk of closure or serious service cuts? Will she confirm that the closure of community hospitals is not a matter of dogma for the Government?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

As the hon. Gentleman knows, we are strongly in favour of modern community hospitals that bring more services into the community. I shall have more to say about that shortly. I want to develop the hon. Gentleman's first point about the reason for deficits.

The hon. Member for South Cambridgeshire painted a lurid picture of a national health service in crisis. In reality, the vast majority of NHS hospitals and other organisations are cutting waiting times, improving services, treating more patients and living within their means. We expect that from every part of the NHS. The hon. Gentleman blames the deficit on managers and administrators. He claims that too many bureaucrats are wasting taxpayers' money.

Photo of Pat McFadden Pat McFadden Labour, Wolverhampton South East

My right hon. Friend compared the deficit in 1997, when the Conservative party was in charge of the NHS, with that today. Would she also like to compare waiting times in the period when the Conservative party was in charge of the NHS with those of today? When the Conservative party was in charge, more than 30,000 people waited longer than 12 months for an operation. How many people today wait more than 12 months for an operation?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I am happy to say that nobody now waits more than 12 months. Waiting times have fallen as investment has risen.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I want to make progress.

In trying to describe what he regards as the cause of the problem, the hon. Member for South Cambridgeshire called administrators a waste of taxpayers' money. I call them medical secretaries, records clerks, receptionists, caterers, launderers and cleaners—the hon. Gentleman claims that he is worried about MRSA. Those people also include health educators, medical librarians, financial managers and human resources specialists. I have examined all the groups that are included in the administration category. They also include IT technicians, maintenance staff and all other support staff.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I shall give way to the hon. Gentleman because perhaps he would like to thank them.

Photo of Andrew Lansley Andrew Lansley Shadow Secretary of State for Health

In the figures that I used—159,000 to 201,000—I expressly included managers and senior managers, who increased by 50 per cent., and staff employed in central functions and clerical and administrative support. I did not include cleaners or porters. If I had included all the support staff, the figure would have been 431,000 rising to 521,000. I left them out.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I have looked at what the hon. Gentleman put on the website and the press release that he issued this morning. I have examined the additional £1.2 billion, not £1.3 billion, that is spent on administrative staff. I assure him that all the medical secretaries, record keepers, health educators, IT technicians and financial managers, without whom our doctors, nurses, therapists and health care professionals simply cannot do their job, are counted among those administrative staff.

Photo of Stephen Hesford Stephen Hesford PPS (Rt Hon Baroness Amos, President of the Council), Privy Council Office

Mr. Lansley claims that his figures refer to management. Has my right hon. Friend seen the figures from the NHS Confederation, which show, contrary to the erroneous assertion by the hon. Gentleman, that from 1999, the increase in management across the board has been only 2.8 per cent. of the work force, which is less than it was in 1999?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

My hon. Friend is absolutely right and he anticipates a point that I wanted to make. In every year since 1996, administrative costs as a proportion of the total NHS budget have been falling. Exactly the same is true of management costs. They constituted 5 per cent. of the NHS budget under the Conservatives; they constitute just over 3.5 per cent. today under Labour. We can do even better than that, however. As part of the Gershon review, we have cut the number of staff employed in the Department of Health from more than 3,500 in 2001 to just over 2,000 by this year.

On the investment that we are making in information technology, I was shown this morning the transformational effects of the electronic patient record that is being trialled at Newham hospital. That investment will slash the amount of time that clinicians and other staff have to spend chasing paper records. At Hinchingbrooke hospital, I saw the new electronic imaging and scanning system that has helped staff to cut the time taken to deliver a report to the consultant and the GP from anything up to 24 days to less than 24 hours. That is a massive saving in clinicians' and support staff's time.

Photo of Jim Cunningham Jim Cunningham PPS (Mr Mike O'Brien, Solicitor General), Law Officers' Department

Earlier, my right hon. Friend said that she would get a reply to the letter that I sent to the University Hospitals Coventry and Warwickshire NHS Trust. Will she also look into why there is a £7 million deficit and a threat to 250 jobs there? I would appreciate it if she could do that for me.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

As I was saying, the reason there are deficits in a minority of trusts is that, in some cases, there has been overspending, sometimes for several years, or poor financial management, or poor organisation of clinical services. We are taking the steps needed to reduce the overall deficit this year and to ensure that, at the end of the next financial year, the NHS will again be in balance.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

No; I am going to make some progress.

In the NHS in the past—this goes back decades—deficits in a minority of organisations were covered up. Money was moved around the system from a surplus organisation to a deficit organisation. The deficit trusts, those parts of the NHS that were overspending, were bailed out by other parts of the NHS that often had equal or greater health care needs. There was no incentive in the system that we inherited from the Conservatives to change or to improve. That is why we are changing the system.

Photo of Graham Brady Graham Brady Shadow Minister (Europe)

The Secretary of State mentioned cover-ups. Before the election, my local trust started to consult on the investment in and modernisation of Altrincham general hospital. Can she therefore explain why I have just heard that today, while this debate has been proceeding, the trust has adopted proposals to close Altrincham general hospital and massively to reduce services at Trafford general hospital? Do we not deserve some honesty from the Government? How can the public ever believe what the Government are saying when they are deceived in that way?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

If a local trust has been overspending or running up a deficit, it will need to make decisions—in some cases, they will be difficult ones—in order to get itself back into balance. The hon. Gentleman talks about honesty, but we have still had no answer, honest or otherwise, on the question of patient passports.

Photo of Ann Winterton Ann Winterton Conservative, Congleton

Can the Secretary of State really sleep at night? She talks of deficits and the reasons for them, yet the Central Cheshire NHS primary care trust will not fund Herceptin, while every other neighbouring trust has done so—

Photo of Ann Winterton Ann Winterton Conservative, Congleton

Would the hon. Gentleman like to repeat that comment? I will give way to him. [Hon. Members: "Stand up."]

Photo of Sylvia Heal Sylvia Heal Deputy Speaker

Order. The hon. Lady is herself intervening on a speech.

Photo of Tony Baldry Tony Baldry Conservative, Banbury

On a point of order, Madam Deputy Speaker. When I was a Parliamentary Private Secretary, it was a point of privilege. The behaviour of the Secretary of State's PPS this afternoon has been disgraceful.

Photo of Sylvia Heal Sylvia Heal Deputy Speaker

That is not a point of order for the Chair, but clearly the remark is now on the record.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

Ann Winterton makes an important point about Herceptin. As she will know, I have already taken steps to ensure that testing facilities for HER2 will be available across the NHS in England, and for NICE to speed up dramatically its evaluation not only of Herceptin but of other drugs coming through the system. I have also made it clear that primary care trusts should not deny Herceptin, where it has been recommended by a clinician for an individual patient, purely on grounds of funding.

In every strategic health authority, and for every deficit trust, a recovery plan is in place. Where the challenge is greatest—where the deficit is largest—the health authority and the trusts have been given more time to sort out the problem, together with transparent financial help from the NHS bank and other NHS organisations. For the organisations with the worst deficits, turnaround teams have gone in to help, not simply to consider the finances but, crucially, to make sure that the trust meets its waiting time and other targets and to help it to deliver the best possible patient care, together with the best possible value for money.

This point is at the heart of the debate. Good patient care and sound financial management are not two things between which any part of the NHS can choose. Good patient care and sound financial management go hand in hand.

Several hon. Members:


Photo of Sylvia Heal Sylvia Heal Deputy Speaker

Order. I will give the Secretary of State time to decide which the hon. Member, if any, she will select.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I think that this is what is called an embarrassment of riches. I give way to Mark Pritchard.

Photo of Mark Pritchard Mark Pritchard Conservative, The Wrekin

I am grateful to the Secretary of State for giving way. I am flattered, and I am glad that I parted my hair in the way that I did this morning—clearly, it works. On that point of financial mismanagement, how does she respond to the independent financial inquiry into the financial mismanagement and series of corporate failings of the Shrewsbury and Telford NHS Hospital Trust? Does she not feel a sense of responsibility, given that her office appointed the chairman, who has now resigned, the chief executive, who has resigned, and the deputy chief executive, who has gone? Does she not feel that she needs to make a statement to my constituents?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

The hon. Gentleman makes the point that we are dealing with the matter. Where management has been inadequate, we are replacing management.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I want to try to make a little progress.

I hope that Conservative Members can agree that we need both good patient care and sound financial management.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health


Although the NHS is doing far better than it was eight years ago, it can do far better still.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health


Several hon. Members have made the point about extraordinary advances in medical techniques. As a result, patients do not need to stay in hospital for as long as they used to. Sometimes, they do not need to go to hospital at all. Indeed, as the admirable Mr. Fieldman told me in Newham this morning, a patient needing a gall bladder operation who in the past would have had to spend at least 10 days in hospital can now have the operation done during an overnight stay, or in some instances as a day case. The best of our NHS hospitals are among the best in the world and we should be proud of them. However, not all our hospitals are achieving the best—too many are not even achieving the average.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

No, I will not give way. I want to make a point. [Interruption.] This is directly relevant to the point made by the hon. Member for South Cambridgeshire. He made great play of hospital beds, but completely failed to focus on outcomes or the impact of new medical techniques.

One strategic health authority compared the lengths of hospital stay for patients with broken hips in the seven NHS hospitals in its area. Two kept patients in for about 20 days, below the NHS average of 25. The other five kept patients for longer than the average. In one case, the average length of stay was 38 days. Those five hospitals had the worst outcomes. The health authority calculated that if all the hospitals simply achieved the NHS average with all their patients, that one area alone would need 400 fewer acute beds.

Photo of Peter Bone Peter Bone Conservative, Wellingborough

The Secretary of State mentioned speed and good patient care. Does she agree that the two may not go together? As she knows, last week I raised the case of a constituent who gave birth at 4.30 am and was thrown out of the hospital at 9 am because of a lack of beds. Is that what the Secretary of State means by speed and good patient care?

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

My point is that thanks to the extraordinary advances in medical techniques, anaesthetics and so on, it is now possible to do on a day-case basis what used to require in-patient care. It is possible to do in a few days what used to require a patient to stay in hospital for many days. It is possible to do outside hospitals what used to require in-patient treatment.

It is true that, compared with the position when I had my two children some 20 years ago, the average length of stay for women having babies is now very short, and most women want to get home as quickly as possible. That may not apply to the case cited by the hon. Gentleman, but generally speaking it is true.

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I have been generous in giving way. Now I want to give another example, involving patient appointments.

Senior surgeons and leading GPs say that between 40 and 50 per cent. of out-patient appointments—on a conservative estimate—in acute hospitals could and should be dealt with by community hospitals, health centres or even large GP surgeries with equally good health outcomes, more convenience for patients and better value for money for taxpayers. That, of course, means fewer beds and fewer facilities in acute hospitals.

Although there are outstanding examples of best practice throughout the NHS, there is not yet the value for money throughout the NHS that the taxpayers whom we have asked to pay higher contributions are absolutely entitled to expect.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

I will give way to the hon. Gentleman. His will be the first intervention from the Liberal Democrats—[Interruption.]

Photo of Richard Younger-Ross Richard Younger-Ross Liberal Democrat, Teignbridge

Yes, one has been trying for a little time to catch the Secretary of State's eye. She spoke of good health care. Does she agree that recovery is better when patients are transferred from general to community hospitals? It is the community hospital beds that are at risk at the moment because of financial deficits in the primary care trusts. If we can keep those beds in place, in hospitals such as the Moretonhampstead in my constituency, we can free up bed space in the district general hospitals.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

Is some cases, an intermediate care bed in a community hospital is a good way of bringing someone out of an acute hospital, but in other cases it is better to bring them straight home with the full support of the patient support team.

Photo of Ian Austin Ian Austin Labour, Dudley North

On the matter of patient care, will my right hon. Friend confirm whether it is indeed the case, as my research has shown, that the number of MRI scans has increased under this Government from 473,000 in 1997–98 to 858,000 in 2003–04, and that the number of heart operations has increased from 39,000 to 65,000—[Interruption.] The more Conservative Members go on, the more statistics I can read out about—[Interruption.]

Photo of Julian Lewis Julian Lewis Shadow Minister (Defence)

On a point of order, Madam Deputy Speaker. I realise that the Government are suffering from the fact that they are labouring on Benches that are heaving with all of about half a dozen of their own Back Benchers, but is it in order for a Government Back Bencher to intervene or ask a question on the basis of reading a script that was overtly handed to him by one of his own—[Interruption.]

Photo of Sylvia Heal Sylvia Heal Deputy Speaker

Order. The House must come to order if I am to deal with a point of order—although it is not, in fact, a point of order for the Chair.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

As my hon. Friend Ed Balls pointed out earlier in the debate, the Conservative party has just fought an election campaign on the basis of a patient's passport policy that would take between £1 billion and £2 billion out of the NHS to subsidise private health care for the few. That would not solve the deficits where they exist in the minority of trusts—it would add to them and devastate the care that the NHS is able to offer right across our country. That, of course, is absolutely in line with the Conservative policy of looking after the few and not the many. The investment that we are making—[Interruption.]

Several hon. Members:


Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

No, I will not give way.

The investment that we are making in our national health service will continue—and so will the reforms and improvements. As we give patients more choice and a stronger voice, as we have more diverse providers but more freedom to innovate—as I saw at the Gateway centre this morning—and as we ensure that money follows patients with payment by results, we will give every hospital and every provider a real incentive to look at how they are working, to compare themselves with the best, to change their ways of operating, to move services from acute hospitals to community settings and to focus on prevention rather than simply cure. In other words, we will deliver the best possible health care with the best possible value for money.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health


We will invest more money than ever before in the NHS. Our constituents can see the improvements. Most NHS organisations are not only delivering improved, better and faster care, but living within their means. That is what we expect from every part of the national health service. I am proud—and every hon. Member on this side of the House can be proud—of the additional investment that we are making.

Several hon. Members:


Photo of Sylvia Heal Sylvia Heal Deputy Speaker

Order. It is for the Secretary of State to decide when or whether she gives way.

Photo of Patricia Hewitt Patricia Hewitt Secretary of State, Department of Health

Madam Deputy Speaker, I am proud and we are proud of the more than 78,000 extra nurses and 27,000 extra doctors employed by the NHS, and the 500,000 more operations being carried out every year. With more patients treated and more lives saved than ever before, we will continue on our path of investment and reform. That stands in striking contrast to the policy of the Conservatives, so I commend our amendment and our programme to the House.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities 4:59 pm, 15th November 2005

I am pleased to debate this subject today, and I am delighted that the Conservatives have made it clear that they are committed to the provision of

"comprehensive, high quality health services, based on need and not ability to pay".

There has been some doubt about that in the past—a doubt that was echoed by Labour Members when they queried the Conservatives' reluctance to commit to funding the health service, and their voting against the £8 billion funding increase associated with the increase in national insurance levels. However, the most important task for us today is to examine Labour's record after eight years in government, and to consider why, despite record levels of investment, many local health services are lurching from crisis to crisis, like a drunk on a Saturday night who grabs at anything in an attempt to stay upright.

I shall return to the question of the deficit shortly, but at this point I want to be fair and to acknowledge that some things have got better. When I was first elected in 2000, my postbag was full of letters from constituents who had been waiting years for hip replacements or hearing aids, or waiting months for heart operations classified as urgent. Such problems have been sorted out to an extent, but others are emerging in our local health services. I suspect that my experience is similar to that of many Members, in that today's issues for my constituents are the rationing of certain treatments and medicines, fear of MRSA, and the reorganisation of local health services. In an unprecedented development, NHS staff are writing letters to whistleblow on changes that they are particularly unhappy with. Such changes often mean a relocation of health services or a loss of hospital beds.

Photo of Mark Francois Mark Francois Shadow Paymaster General

Is the hon. Lady aware that in the run-up to the general election, the Government were pushing very heavily a brand new diagnostic and treatment centre at Fossett's Farm, in Southend, to relieve pressure on Southend hospital, but once the election was safely out of the way, they promptly cancelled it? Does she think that a shocking and awful thing to do? The people of Essex certainly do.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

I can understand why local people think that dishonest, and presumably there are other such examples from elsewhere, but I am not aware of any specific ones.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

I was struck by the number of Members who tried to intervene earlier to discuss the problems in their health economy, but I will not give way just yet as I want to develop my argument.

The one question that is common to nearly all the letters that I receive from constituents, no matter what issue they are raising, is: where has all the money gone? The NHS Confederation recently produced a briefing—not for this debate, I hasten to add—to try to answer that very question. Its summary states:

"Fifty per cent. of new investment has been spent recruiting new staff and paying higher salaries".

Some 20 per cent. of the new investment was spent on employing additional staff, and 30 per cent. was spent on additional pay for existing staff. The confederation's view is that that has led to people being treated quicker and more effectively, but the opposite view has been espoused from some quarters that although this money is welcome, the staff pool merely expands to meet the available budget. One problem has been a failure to ensure that the right services receive the right money.

Another major area of NHS spending is the drugs budget. In 2004–05, 686 million items were dispensed in England—an increase of 5.6 per cent. on the previous year. The drugs bill has risen by 46 per cent. since 2000 and now stands at some £8 billion. I do not share the view, espoused today in The Daily Telegraph, that that is a scandalous waste of money. Better prescribing has in many cases led to better outcomes. The prescribing of statins, for example, the current annual cost of which is £70 million, has the benefit of saving an estimated 9,000 lives a year. I am sure that those people are very grateful for that investment. Another claim on NHS resources has not been mentioned. The cost of inflation-proofing pensions has been transferred from the Treasury to the Department of Health—a classic case of the Treasury giving with one hand and taking away with the other.

It is also worth mentioning the NHS IT project, a huge investment amounting to more than £6.2 billion over 10 years. Unfortunately, the process seems to be dragging on somewhat, so far with little apparent benefit for patients. For example, the choose and book system for hospital appointments was due this December, but will be at least a year late. Predictably, Richard Granger, the man in charge of the scheme, has said that that is not his fault and claims that responsibility for the late delivery lies with the policy people at the Department of Health. If the Secretary of State is able to elaborate on the problems at the Department, I am sure that we would all be very interested.

To date, only 20,000 appointments have been booked. To put that in proportion, I can tell the House that about 9.5 million appointments are made every year, and that the target was to have 250,000 trial appointments booked by last December.

The NHS faces other significant cost pressures, such as those incurred by clinical negligence cases and the implementation of NICE guidance. However, the NHS Confederation is most interesting when it comes to the subject of why the service needed the extra money in the first place. It notes that Wanless analysed the state of the deficit under the previous Government, especially as a result of the tight financial settlements of the 1980s and 1990s, and then states that that cumulative deficit

"goes a long way to explaining the shortage of many types of staff, the poor condition of many buildings and the low level of investment in equipment."

I stress that the confederation is talking there not about the present situation, but about one that pertained some years ago. It also said:

"A culture developed in which NHS organisations were expected to report that they had 'broken even' without any enquiry into whether the methods used were sustainable."

That led to cuts in cleaning and catering budgets, and the confederation added that

"many key developments were put on hold, delayed or scaled back."

It reported that that affected the health service's approach to the prescribing of new drugs, as well as to matters such as buildings maintenance, staff shortages, staff training and new equipment.

At one stage, there was a freeze on the appointment of new consultants. In that, we might have come full circle, as the BMA has received reports from various quarters of a proposed freeze on consultant recruitment, and says that there is a threat of redundancies among consultants. The Royal College of Nursing has tracked the accelerating effects of the deficits since January, and only last week expressed concerns about the possibility of widespread nursing redundancies. Beverly Malone, RCN general secretary, said:

"We are putting a spotlight on this issue now before it is too late. Valuable, highly experienced frontline staff could be lost and we simply cannot afford to let this happen. It will hit patients services and put even more pressure on the nurses that are left. Nurses have delivered huge improvements in NHS services and they have led the way in modernising the NHS. These job losses are a slap in the face to them and suggest their past, present and future contributions are of little value."

I do not think that any hon. Member would say that the contribution made by nurses was of little value, but it is a matter for concern that the RCN should feel it necessary to put that on the public record.

That is the background, but I want to return to the situation that exists today. Overall, the NHS has just about squeezed in on budget, but about one trust in six is in deficit. The problem is getting worse, and the National Audit Office has said that 12 SHAs ended the financial year 2004–05 in deficit, compared with seven the previous year.

Earlier, the Secretary of State said that financial managers responsible for a lack of prudence had been moved out of the way. I pay tribute to the new chief executive of the Hampshire and Isle of Wight health authority, Sir Ian Carruthers. He has a very good strategic overview, wants to keep services, and seems to be the only person who understands how all the trusts meld together. However, it is somewhat disappointing that his failed predecessor should have been given a plum job in Whitehall. It might be an interesting exercise to see what happens to failed SHA chief executives, and find out whether all of them have been given similarly cushy numbers.

Photo of Philip Hollobone Philip Hollobone Conservative, Kettering

Is the hon. Lady aware that pressures on local health services are particularly acute in areas with rapidly growing populations? Is she aware that in the Secretary of State's local health authority—the Leicestershire, Northamptonshire and Rutland strategic health authority—the PCTs are underfunded by £88 million below the national capitation fund? It is the worst funded strategic health authority in the country.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

I was always under the impression that Hampshire was the worst funded health authority. It is certainly the case that the funding formula is not fair and does not create a fair distribution. While there is a case for giving more funding to areas with higher health inequalities, such as the north-east, the spread of funding causes particular pressures on those at the bottom end of the funding scale. A slight narrowing of the scale would make a great difference, especially to authorities in the south-east which are more likely to be in deficit. It is interesting to look at a map of the strategic health authorities in deficit, because it shows that the problem is weighted towards the south-east.

Photo of Richard Younger-Ross Richard Younger-Ross Liberal Democrat, Teignbridge

In the south-west, the number of PCTs in deficit is greater than one in six, although my own PCT team has done exceedingly well. One of the reasons cited by the strategic health authority, which has lobbied us on the issue on many occasions, is that the funding does not take account of sparsity or the coastline effect, which make the costs higher than average.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

We could probably have a separate debate on the special factors that could be taken into account in the funding formula, but I take my hon. Friend's point.

Twelve NHS trusts reported a deficit of more than £5 million in 2003–04. The King's Fund has pointed out that NHS productivity has fallen, according to the official measure, but it also acknowledges that that is not necessarily a measure of quality. How should we measure quality in the NHS? In recent years, we had the star ratings—now largely discredited—and the trusts learnt to play the game. Resources were put into areas that had targets associated with star ratings. Not only did that sometimes cause trusts to spend money that they could ill afford, but health services not associated with the targets became easy options for savings.

A particular example of that tendency is specialist services, such as renal and dialysis services, which are especially vulnerable. They are expensive and affect relatively few patients, and the same provider often services several PCTs. They are easy targets but patients diagnosed with one of the specialist diseases—there are 34, but I shall not list them all—should not suffer as a result of the historical financial health of local NHS organisations. When payment by results is introduced, some of those existing inequalities could be exacerbated.

It would be bad enough if that were the whole story. However, the British Medical Association has pointed out that cash shortages in the NHS contrast dramatically with the generous terms negotiated with some private sector providers—as Conservative Members have pointed out. The BMA makes the point that it is cause for even greater concern when the contracts agreed with such companies allow payments to continue, despite significant underperformance. Examples include the orthopaedic contracts in south Yorkshire and Trent and some MRI and eye contracts. It would be useful if the Secretary of State could explain what sanctions are in place for when private providers do not deliver the services for which they are contracted.

In many cases, the cuts have taken place with little or no clinical engagement and—unfortunately—even less public engagement. In September, the BMA conducted a survey of trusts that revealed that one in three planned to reduce services. Intended reductions included bed closures, staff redundancies and a freeze on recruitment, reduced elective services, ward closures, cuts in training and a reduction in patient transport services. Three quarters of respondents reported that their trust faced a financial shortfall in the current financial year and more than a third reported that funding agreements with PCTs had been changed at short notice.

The Government cannot have it all ways. Financial instability is an inevitable consequence of reintroducing the internal market. In any market, there are winners and losers and rushed reforms tend to exacerbate existing inequalities. Does the Secretary of State think it wise to introduce a system that sets hospitals against each other, rather than encouraging them to work as partners in providing the best possible overall service for patients? The market mechanism depends on successful trusts gaining patients while others lose out.

Some people have asked what will happen to spreading best practice. If one trust is doing particularly well and attracting many patients, there is not much incentive for it to spread the secret of its success. The hospital losers will face bigger deficits; they will have to make more cuts as a consequence and the downward spiral will increase. The real losers will be the patients, although that might not be the case if local accountability was improved.

At present, the accountability of senior officers in primary care trusts or acute hospital trusts is to politicians at Whitehall. The focus is very much on delivering the targets that the Government want. That may be fine but sometimes it does not take into account local needs and local decision making. Perhaps we should move towards a system with more accountability to local people.

It seems slightly ironic that the Government are engaging in a large-scale listening-to-Britain exercise and are making knee-jerk announcement after knee-jerk announcement, yet the public feel increasingly that consultations at local level are tokenistic, decisions have already been made and local health managers are not listening.

Photo of Mark Hoban Mark Hoban Conservative, Fareham

I am grateful to the hon. Lady for raising the issue of public consultation. Does she share my disappointment that mothers in my constituency were told only 14 days before it took place of the closure of the Blackbrook birthing centre? That closure was made as a result of financial and staffing problems in Hampshire PCTs and hospital trusts.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

I share the hon. Gentleman's disappointment and shall return to that point briefly later in my speech.

Nowhere is the problem more apparent than in the many closures of community hospital beds throughout the country—90 examples have been mentioned. In many cases, local communities raised significant amounts of private money to invest in their community hospital so there is a growing sense of anger.

Photo of Mark Simmonds Mark Simmonds Shadow Minister (International Development)

The hon. Lady is making a pertinent point. In my constituency, it is proposed to close one ward of the Skegness and district general hospital, which is 50 per cent. of the hospital. East Lindsey district council, the local authority, offered the primary care trust £90,000 to allow the ward to reopen immediately, but I understand that the Government blocked that offer. Does the hon. Lady agree that that is an absolute disgrace?

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

I do not know the details, but it is clearly disappointing that blocks are put in the way when someone has come up with a creative solution to a problem. I have been working with the hon. Members for New Forest, West (Mr. Swayne) and for New Forest, East (Dr. Lewis) on a similar problem, and the hon. Member for New Forest, East came up with a similar idea. It has not been developed, although not for the same reasons. I hate to think that we could have developed our project to an advanced stage only for it to be scuppered at the last moment.

In many communities, there is a growing sense of anger that health organisations are trying to take away something that belongs to, and is very much part of, the community. In south-west Hampshire, some of us have been working together against the proposed closure of community beds in hospitals in the New Forest and Romsey. We work across the political divide, which has gone down well with the public who regard it as unusual for politicians of different parties to work together. We tried to present a united front to the local PCT alliance to persuade it to rethink the ill-thought-through proposals to close hospital beds.

One option—described by someone as the nuclear option—was to close all community hospital beds in the area. That proposal completely ignored a bed survey that showed a great need for patients to move out of the acute hospital trust and into the cheaper, and some would say friendlier and more homely, community hospital beds. So huge amounts of money are being wasted in the local health economy by keeping people in acute hospitals inappropriately. The scandal is that the managers have not got their heads around moving people more effectively through the system and that the knee-jerk reaction has been to cut the number of beds at one end of the scale.

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

Does the hon. Lady agree that the problem is not just that closures in community hospitals will cause bed blocking, but that overstretched ambulance services—many of which are already struggling to reach their targets, not least in rural areas—will be further inconvenienced and schools, such as the Hornsea school in my constituency, will use ambulances for minor injuries, taking those services away from people who need them more?

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

Ambulance services have frequently been a target for underfunding by other trusts. Again, a lot of this boils down to having good overall strategic management that can ensure that ambulance trusts are funded. As I mentioned earlier, the BMA survey showed that the possible reductions in patient transport can cause great problems for many patients.

As well as the problems posed to patients by closing community hospitals, what has not been pointed out is the effect on social care budgets. If patients are treated at home, instead of in community hospitals, they become liable for all their personal care needs. That involves means-testing and patients paying money that they probably can ill afford to pay, but they are often unable to think about that when they are trying to recover from an illness. The burden on social services departments has not been mentioned today. We could have a parallel discussion of the problem of moving patient treatment from health to social services and the impact that that has had on social services budgets, many of which are over-spent.

Photo of Anne Milton Anne Milton Conservative, Guildford

Does the hon. Lady agree that we need to discuss the serious issue of the cost shifting that will go on as a result of the closure of community beds? Indeed, a lot of local councils are already very concerned about their budgets for next year. One way to wipe out an NHS deficit is simply to dump it on local councils.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

I agree with much of what the hon. Lady says. The big problem is that local health trusts do not talk to social services departments when such changes are made. That causes huge problems. One Liberal Democrat policy at the last election was to develop a much closer melding of health and social care budgets, thus helping with some of those problems. In the proposed reorganisation in London, PCTs are starting to work with local authorities, but it is disappointing that the Government seem to want to break down the good working relationships that already exist.

Photo of Jane Kennedy Jane Kennedy Minister of State, Department of Health

The hon. Lady might like to talk to her colleagues who run Liverpool city council, where relatives of the users of local authority social day-care provision, which is being closed down right across the city, have appealed to me to see whether we could find a way for the PCT to take responsibility for social services from the local authority. That is not exactly the best example of a local authority working in the interests of people in need of social care.

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

The Minister's point reinforces my assertion that such perverse decisions would not need to be made if the budgets were combined.

The Government claim that patient choice is all important. The Liberal Democrats believe that choice should not be artificial, such as that offered by the delayed choose and book scheme. Choice should involve a variety of provision available to all. That is particularly so with maternity services. A woman should have the right to choose between a home birth, a birth in a midwife-led unit or to be under the supervision of a consultant.

On Monday, the National Childbirth Trust called on the Government to take urgent action to protect the future of birth centres in the UK and cited examples of recent service cuts, one of which has been mentioned by Mr. Hoban. Other places affected include my area of Romsey, and Petersfield, Southport, Malmesbury and Wakefield. The trust points out that because of staffing issues and financial constraints, a full range of maternity services is available to only a minority of women in the UK.

The Secretary of State will be aware of the Labour manifesto pledge:

"By 2009 all women will have choice about where and how they have their baby and what pain relief to use".

Government policy emphasises the importance of choice by stating:

"The range of ante-natal, birth and post-birth services available locally constitutes real choice for women" and

"Local options for midwife-led care will include midwife . . . units . . . in the community".

I could wax lyrical about the benefits of midwife-led units, but I will restrict my comments to asking the Secretary of State to investigate the problem and come to the House to inform us what action the Government are taking to reverse the situation.

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

Did the hon. Lady read, as I did, the report by the health service commissioner published earlier this year about the need to make maternity services more locally based? Is she aware that NICE is reviewing midwife-led services to ensure that there are also safe outcomes? Should we not be ensuring that there is a proper balance between locally based services and ensuring that the outcomes are safe for both mother and child?

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

I am not quite sure what point the hon. Lady is making. It is quite insulting to midwives who work in midwife-led units to suggest that those units are somehow more dangerous to women. Many women have perfectly safe births in such units. Midwives are the experts on birth, so I find the hon. Lady's comments rather strange. However, of course, we must wait for the NICE review.

I am alarmed that some of the cuts that are apparently the easiest to make are those to aspects of the public health and preventive health agendas. I was interested by the Secretary of State's closing remarks because although she said that public health was a Government aim, that does not seem to be shown by the situation on the ground.

I shall cite a local example. Owing to the deficits, a local hospital wanted to cut cardiac rehabilitation classes, which offered people post-operative exercise and re-education about their lifestyle. They were a good aspect of the preventive health agenda. There was public uproar and the decision was reversed.

There is excitement in my profession of pharmacy about the new pharmacy contract, but that is tempered by the fact that many primary care trusts do not have the money to develop new services, especially if there is an underlying deficit.

Photo of Justine Greening Justine Greening Vice-Chair (Youth), Conservative Party

The hon. Lady makes a valid point. In the London borough of Wandsworth, our primary care trust has a substantial deficit of £8 million. In fact, that deficit is one of the things that is stopping its proposal to reopen Putney hospital, which was shut under this Government. However, £300,000 a year is being spent on keeping the site secure while we decide what will happen, and that valuable asset is not being used. Does she agree that that is a disgrace and a waste of valuable taxpayers' money?

Photo of Sandra Gidley Sandra Gidley Women & Older People, Non-Departmental & Cross Departmental Responsibilities

Sadly, hon. Members have cited many examples of taxpayers' money being wasted. I have sympathy with the residents of Putney.

Surely it is short-sighted not to think about funding the new pharmacy contract when approximately a third of all hospital admissions are drug related and many people live with long-term conditions that could be managed more effectively with a little help. Pharmacies can deliver obesity-management and smoking-cessation services, so a golden opportunity is being squandered when such services are not encouraged and possible long-term savings are not being achieved. Other Cinderella services include mental health services and those involving mainly older people, such as stroke services.

Liberal Democrat Members will support the Conservative motion because it must worry us all that unprecedented amounts of investment have not been accompanied by improved patient outcomes across the board, and that the Government are spectacularly failing to monitor, control or improve the situation.

Several hon. Members:


Photo of Sylvia Heal Sylvia Heal Deputy Speaker

Order. May I remind all hon. Members that Mr. Speaker has imposed an eight-minute limit on all Back-Bench speeches?

Photo of Laura Moffatt Laura Moffatt Labour, Crawley 5:29 pm, 15th November 2005

I decided to apply to take part in this very important debate because, first, as a former nurse, I worked in the national health service for more than 25 years, and, secondly, I am one of the Members of Parliament whose acute trust has the highest deficit in the country. I want to contribute to trying to understand deficits, how they come about and how we in this House have a responsibility to explain properly what is happening to the new health service of today. Sitting in this Chamber, laughing, joking and joshing is not the way to tackle very serious matters.

Photo of Laura Moffatt Laura Moffatt Labour, Crawley

Not at this point.

As the Secretary of State clearly outlined, we are right to be sceptical about why this debate was called, although I believe that it is perfectly right to look at deficits in the NHS and for Members to consider them seriously. However, it galls me a little to hear some of the comments from the debate, because as a nurse working in a trust, I was asked to forgo half of my pay rise because there was no money to pay staff. Strangely, that was in 1996, when I believe we had a Conservative Government.

Photo of Laura Moffatt Laura Moffatt Labour, Crawley

No, I will not give way at the moment. We need to put the debate into context, and if we do not do so we shall not have an honest and honourable debate.

We know how much funding has increased. Indeed, the extra cash that has gone to the NHS is astounding—it is something that we dreamed of. Before 1997, we did not believe that that could become a reality. We therefore have to consider what can go wrong against the background of that extra funding to the NHS, and understand why some trusts get into difficulties.

I am afraid that for Surrey and Sussex Healthcare NHS Trust the pattern of decline was set many years ago when Crawley hospital was not invested in, when its priorities were not foreseen, when it accumulated an enormous amount of necessary repair work and when issues connected with the quality of service were not tackled. I know, because I was a night nurse who more often than not worked alone without the support of senior doctors. So, on the day after the momentous election in 1997, I knew that we would face difficulties, because there was no way that a Labour Government would allow the quality issues in the NHS to be ignored. It would have been easier—

Photo of Laura Moffatt Laura Moffatt Labour, Crawley

In a moment.

It would have been easier for us to jog along and not tackle many of the issues. Our local residents would have thought that everything was fine in the NHS, that there were no problems and that there was no need to worry about senior staff or accreditation and the fact that the royal colleges were going to withdraw the support of junior doctors in the trust—but of course we had to worry.

Photo of Crispin Blunt Crispin Blunt Opposition Whip (Commons)

While the hon. Lady is dealing with the issue of deficits I hope that she will not overlook informing the House of her own contribution to creating a deficit at Surrey and Sussex trust by her intervention in 2001 to stop the reorganisation of services between her hospital and East Surrey hospital, which cost more than £10 million and continues to cost that today.

Photo of Laura Moffatt Laura Moffatt Labour, Crawley

I am very grateful to the hon. Gentleman for raising that issue. I do not know whether he is aware of just what a fantastic contribution he made to ensuring that my constituents knew that I was fighting on their behalf to keep our hospital open. I publicly thank him for his work, because I could not have paid for the publicity that he gave me. I do not think that any Member could be criticised for ensuring that their hospital survives.

As I said, there was a lack of investment in Crawley hospital. Without doubt, it would be closed by now if the Labour Government had not ensured that money was available to keep it going. The agenda was clear. Without a shadow of a doubt, Crawley was ready for closure, because no investment had been made in it. I am therefore deeply proud of my contribution to efforts to ensure that it remained open.

The issue of deficits overshadows much good work. My main complaint is that it is difficult to talk about anything other than deficits in any forum, even when £19.2 million of desperately needed capital investment has been made in Crawley hospital. That money has been used to provide a dialysis unit and to upgrade the walk-in centre to an urgent treatment centre that will see people 24 hours a day. Some 85 per cent. of people who came through the door of the walk-in centre will still be entitled to do so to receive emergency care. This debate appears to suggest that everything is wrong, but even in the trust with the biggest deficit in the country significant improvements are under way. Staff are delivering services that I did not even think possible. The trust can offer cardiac catheterisation. People used to go to London to have that done, but they no longer need to do so. A chronic disease management centre is under construction at Crawley so that people can receive walk-in care and will not have to spend weeks in hospital. GPs in my area can now refer dermatology patients for treatment the same week. They used to wait 22 weeks for such treatment.

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

The hon. Lady said that the Labour Government would not ignore quality issues. Does she think that the doubling of deaths from hospital-acquired infection shows a Government committed to quality?

Photo of Laura Moffatt Laura Moffatt Labour, Crawley

I am worried about the way in which the hon. Gentleman phrased that question. I worked in an isolation unit, where I cared endlessly for people with hospital-acquired infection. We did not even count the number of people trooping through my ward. A day did not go by without another ward ringing to inform us of another patient who had to be isolated because of hospital-acquired infection. We therefore need to be careful about the way in which we articulate the problem. The way in which we are tackling it now bears no relation to the way in which we did so before 1997. At that time, there was no commitment to address quality issues, and we did not prescribe the drugs that are used today. Soon after the 1997 election, surgeons and medics in my area, particularly those who were dealing with cancer patients, rang us every other day begging us to release drugs for treatment. That no longer happens. I accept that there is a big debate about Herceptin, but, quietly and gently, people are now receiving the services that they need. Locally, people might be upset if services change and there is no longer a hospital on their doorstep that can offer them all the services they need, but when they do receive hospital treatment they know that they will receive a first-class service.

Photo of Grant Shapps Grant Shapps Co-Chair, Conservative Party

I accept that the hon. Lady is speaking with a great deal of sincerity, given her nursing background. However, is she not in the least concerned that things are going off the rails? We have heard many stories about trusts in deep deficit—indeed, a deficit of £1 billion may be run up next year—so is she not embarrassed about her Government's performance?

Photo of Laura Moffatt Laura Moffatt Labour, Crawley

No, I certainly am not.

We need to get deficits under control. We have a fantastic campaign group in Crawley that is desperate to have a new hospital. We cannot offer that unless management can control the budget, which will enable us to move forward and offer even more services to more people, thus ensuring that the Labour Government do what people expect them to do—deliver a first-class NHS.

Photo of Nigel Waterson Nigel Waterson (Also PPS To the Chairman of the Party), Work & Pensions & Welfare Reform 5:39 pm, 15th November 2005

I am delighted to be able to take part in this timely debate. I called a debate on 6 April about the problems at my hospitals trust. It was the last Westminster Hall debate of the previous Parliament. The position then was extremely grave. The trust had issued a press release referring to extreme pressure on the hospital, 97 per cent. bed occupancy over a period of six weeks and 158 operations cancelled, and it was proposing to close accident and emergency for periods because of the severe pressures. The then chief executive said:

"When levels of bed occupancy reach into the upper 90s risks of clinical errors become unacceptably high."

I had a meeting at the time with the Minister of State, Ms Winterton, which she will remember, and she agreed to put a recovery and support unit from the Department into the local NHS. In short, we had some serious problems.

What has changed since April? We had a general election campaign and suddenly, miraculously, some funds were found to ease some of the bed-blocking problems that we had at the time. We already had the highest level of bed blocking in the entire NHS. We have seen nothing of the recovery and support unit. It may have intervened, but as far as I am aware, it has not been to my local hospital. Extra funding has been put in by the county council. East Sussex county council has again had one of the lowest, if not the lowest, settlements of any county across the country, but in the past four years it has managed to increase spending on older people's services by 35 per cent., despite the fact that over that four-year period its central Government grant has increased by only 1 per cent. if one strips out the money passported to education.

What has the hospital done? It has opened a new, allegedly temporary ward, the Polegate ward, in the car park. It has tried many different ways of reducing the level of bed blocking in Eastbourne and Hastings, yet delayed transfers of care remain stubbornly high. Recently, they nearly reached 100 beds—that is, 10 per cent. of all the beds across the whole hospitals trust. That has led to cancelled operations. In a six-month period, 472 operations were cancelled at the last minute. This year the trust is expected to make cuts of £17 million.

In August the then acting chief executive sent a letter to all consultants in the hospitals dealing with the overspending, making it clear that reducing the deficit and getting back into balance was a priority alongside MRSA reduction, cancer waits, emergency access, waiting times and so on, and pointing out that tough budget decisions were needed, with no issue off limits for debate. The letter mentioned also

"the burden of decisions which have major safety or 'political' implications."

One of the problems with the bed blocking has been the difficult budget for social care in the county of East Sussex. We have the highest proportion of over-85-year-olds in the entire country, which has put an immense burden on social and health care. The county council is spending above average per head on the problem, yet contrary to popular belief—it certainly seemed to be the belief of the Minister who answered my debate in April, now the Transport Minister—average earnings in East Sussex are some £5,000 less than the average for England.

Since April, the problems have got worse, not better. Staff, patients and their families have experienced intense pressure, a high level of operations have been cancelled and the bed blocking is the worst in the entire NHS system.

In the meantime, we have lost our chief executive, who left in slightly mysterious circumstances, and I have been unable to obtain details of the severance package paid to her. A new chief executive was parachuted into the trust without the post being advertised, without competitive interviews and without any of the other provisions that are normally observed in the public sector. There has been a culture of secrecy at the local trust, although Ministers have stated in written answers that they were not involved. I suspect that the strategic health authority was the real driver behind that culture, but I am yet to accept that there are no ministerial fingerprints. Many of my constituents think that if several hundred thousand pounds—this is a rumour, but rumours can be countered by publishing the details—have been taken out of patient care for a severance package, the matter should be put in the public domain.

We have a new problem, as well as a new chief executive, whom I wish well given the problems that she faces. Only a few days ago on 9 November, the hospital announced unilaterally that it will turn away patients from out-patients, because it has reached the level agreed in the contract with the local primary care trusts, but the PCTs dispute that point and take the view that it is still under contract. In fairness to the PCTs, they have stepped forward to try to ensure that every patient is seen within the 13-week period, even if patients have to be referred to private providers. I hope that that is what happens, but I do not want to see an additional burden being transferred unilaterally to my local PCTs, not least because they are also in deficit. When I asked the chairman of my local PCT at its annual general meeting in the summer whether the PCT would prioritise patient care or eliminate the deficit, she made it clear that the PCT would put patient care over eliminating the deficit.

I have tabled an early-day motion asking the Government urgently to review funding in East Sussex for social and health care, particularly having regard to the high proportion of elderly people to which have I already referred. I have not yet received an answer to this vital question: will eliminating financial deficits or the clinical needs of patients take priority under this Government?

Photo of Stephen Hesford Stephen Hesford PPS (Rt Hon Baroness Amos, President of the Council), Privy Council Office 5:47 pm, 15th November 2005

Mr. Waterson has said that the debate is timely, and I think that he is right.

Conservative Members have mentioned the word, "embarrassment", but the two go hand in hand. One of the reasons why Mr. Lansley was unable to answer questions about the patient's passport is that one Conservative party leadership contender likes them, while the other says that they are old hat. Until Conservative Members work out that conundrum, it is embarrassing for them to call a debate such as this. My right hon. Friend the Secretary of State has said that she is proud of what the Government have done for the NHS, and I am proud of how the NHS delivers in my constituency—if I have time, I will raise some relevant examples.

Conservative Members should also be embarrassed by their motion. I have already questioned the sum of £600 million, which is a gross exaggeration, so I am glad that the hon. Member for South Cambridgeshire is back in his place. It is an exaggeration, too, to speak of £1 billion. When my right hon. Friend the Secretary of State talked about administration costs, the hon. Gentleman tried to focus on management costs. According to the NHS Confederation, there are fewer people in management, as a percentage of the work force, than in 1999.

My hon. Friend Laura Moffatt indicated how deficits occur. Conservative Members must understand that we inherited an appalling situation. In many cases, any deficits that occur have been rolled over from year to year as a result of inherited deficits from the Conservatives' time in government. My right hon. Friend the Secretary of State was right to point out that we inherited what Wanless described as a £3 billion cumulative under-resourcing of the NHS. We have been trying to put that right, as well as increasing investment.

I want to talk about the situation in my constituency. It is often valuable advice for hon. Members to speak about that which they know, and I know the situation in Wirral very well, having for eight years met people from all parts of the NHS every three months in order to understand their story as it has unfolded. It can be painful to shift resources from the acute sector to the community sector to create a primary care-led, patient-led NHS. That can lead to budgetary difficulties. To deal with that, the Government will in due course publish a White Paper on care out of hospital.

One of the reasons for making primary care trusts focus more on commissioning is to ensure that there is patient choice and direct management control. That means that there is no power struggle between the PCT and the acute trust, as has sometimes happened, and resources can be directed towards an NHS that is properly redesigned for the future. My local acute trust has taken the necessary action to design a service that leads to recurrent savings in resources. As a result, its deficit has disappeared. I commend that approach to Members on both sides of the House and suggest that they should have a conversation along those lines with their own acute trust management.

When Labour came to power, the budget for my acute hospital was just over £100 million; now, it is nearly £300 million. It is one of the largest non-teaching hospitals in the country. It was an 800-bed hospital; now, it has nearly 1,000 beds. I do not recognise Conservative Members' accusations of bed cutting. Indeed, I had the honour of opening a 12-bed high-dependency unit costing £1.2 million just before the 2001 election.

If Conservative Members want a serious debate, I thoroughly recommend that they first have a conversation in their own patch to see whether their NHS management is doing all that they could with the money that we have provided, which is more than enough.

Photo of Tony Baldry Tony Baldry Conservative, Banbury 5:55 pm, 15th November 2005

The House heard an incredibly complacent speech by the Secretary of State. She has fallen into the trap that all Governments fall into in their dying days—that of having her officials only take her to see Government flagship projects. Half her speech was taken up with trumpeting flagship projects, and she did not wish to hear about any of the problems that are being experienced in parts of the country that are suffering from deficits.

I issue to the Secretary of State the same invitation that I have already issued to her fellow-Ministers—the Minister of State, Ms Winterton and the Under-Secretary, Mr. Byrne—in debates in Westminster Hall: please come to Oxfordshire to see the other side of the story. The health economy in Oxfordshire is in freefall. The strategic health authority tells us that in the next six months the Oxfordshire health economy has to save £35 million.

Those cuts are the responsibility of Ministers. Under the present Government funding system, Oxfordshire receives only 85 per cent. of the national average for NHS funding. Ministers say that that is because Oxfordshire is wealthy compared with other areas, but it is exactly that comparative wealth that presents the NHS in Oxfordshire with some of its most difficult problems. Housing costs are high, as are nursing costs and agency costs.

What does that mean for our local NHS? The Government's funding plan has already resulted in the proposed closure of the gynaecological ward at Horton hospital in Banbury, and the Oxford Radcliffe Hospitals NHS Trust is considering closing wards at the John Radcliffe hospital and the in-patient pain relief unit at the Churchill hospital. Wards are being closed, beds are being lost, and community hospitals are either not being built or under constant threat of closure.

The Government's amendment has the audacity to claim that they are investing £100 million in a community hospitals programme. Way back in 1997, Mr. Milburn stood at the Dispatch Box and promised the people of Bicester a new and enlarged community hospital. We are still waiting for it. In the other place, Lord Warner cannot even tell us whether community hospitals will have beds. If the Government cannot recognise that a community hospital must have beds, God help us all.

The Oxfordshire health economy has to try to save £35 million this year, £25 million of which is to come from the Oxford Radcliffe Hospitals NHS Trust. That can happen only under slash-and-burn cuts. Yet when Ministers are asked about that, they do not take responsibility, but pass it on to the strategic health authority.

Photo of Jeremy Hunt Jeremy Hunt Shadow Minister (Work and Pensions)

Is my hon. Friend aware that, under this Government's funding formula weightings, the priority given to social deprivation is three times greater than that given to the proportion of elderly people in an area or to the costs of health care delivery? Does he agree that the people who suffer when that happens are not rich people living in rich areas but poor, elderly and vulnerable people who happen to live in areas that have Conservative Members?

Photo of Tony Baldry Tony Baldry Conservative, Banbury

The weak and the vulnerable will suffer as a consequence of the Government's complacency about what is happening in the NHS. More than that, the Government wash their hands and claim that strategic health authorities make the decisions. They say that SHAs can set out recovery plans, but I wrote some three weeks ago to the chief executive of the Thames Valley health authority to stress that there was no way in which the Oxford Radcliffe Hospitals NHS Trust could save £25 million between now and the end of the financial year. I continue to await a reply. I suspect that the reason is that, yet again, we are undergoing an NHS reorganisation, with all the PCTs in Oxfordshire becoming one.

There is an added twist in Oxfordshire. Clearly, some wise guy in No. 10 thought that it would be fun to consider putting out the management of the Oxfordshire PCT to the private sector. Ministers cannot even work out whether they want to accept the responsibility for that. The Guardian on Saturday reported that Ministers had given an indication that the PCT in Oxfordshire could not go out to private management. Yet the previous day, the Minister of State said in a parliamentary answer:

"No decision has yet been taken on the possibility of any strategic health authority (SHA) tendering for the private sector provision of management services for future primary care trusts (PCTs)."—[Hansard, 11 November 2005; Vol. 439, c. 828W.]

Why on earth does not the Minister simply say, "PCTs are not going to be allowed to do this"?

UnitedHealth, whose international director used to be an adviser at No. 10, clearly believed that the trust would be allowed to go out to private management. He wrote to me on 11 November, only last week. The letter stated:

"The board of the SHA has approved the outsourcing."

It is interesting that the international director is clearly privy to information that is denied the Royal College of Nursing and Unison. When those organisations had the temerity to ask under the Freedom of Information Act 2000—that is their only hope of discovering anything from the Government—they are effectively told to shut up because any discussions between the SHA, UnitedHealth and other providers are subject to commercial confidentiality. That is what will happen with outsourcing resources from the NHS. We will increasingly be told that we cannot ask questions because events are subject to commercial confidentiality. That is exactly what happened in Oxfordshire. It is a distraction from what should be happening to sort out the deficit and the proposed cuts in the Oxford Radcliffe Hospitals NHS Trust.

Ministers should do three things. First, they should intervene in Oxfordshire and elsewhere to ensure that SHAs do not impose unrealistic targets for damaging cuts. Otherwise, slash-and-burn reductions will take place not because they make sense but because they are the easiest way to save money.

Secondly, will Ministers please examine the formulae? My hon. Friend Mr. Hunt and all Conservative Members would say that the Government must consider the formulae and the way in which money is allocated. It cannot be right that Oxfordshire receives only 85 per cent. of the average funding for the rest of the country. If Ministers bothered to come to Oxfordshire, they would realise that areas such as Blackbird Leys in the constituency of Mr. Smith and wards such as Ruscote and Hardwick are as socially deprived as anywhere in the country. The formula is simply not fair.

Thirdly, Ministers must ensure that we do not continue to go through the ridiculous organisation and reorganisation of the NHS. How much money has been wasted by initially setting up many PCTs and then reorganising them into single PCTs? Moreover, Sir Nigel Crisp said at the start of the recess that PCTs would be allowed to do one thing but the Secretary of State now claims that they will not be allowed to do it. How does anyone in the NHS have any idea about what is supposed to be happening when Ministers keep chopping and changing their minds about what they expect of NHS organisation?

I am sorry that the Secretary of State was so complacent this afternoon. Every time an operation or the NHS fails a person in Oxfordshire, I shall ensure that those people have a summary of this afternoon's debate. Labour Members got up and simply told us how wonderful things were in their part of the country. That demonstrates the two nations that the Government have created.

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury 6:04 pm, 15th November 2005

Again, we start a debate with collective amnesia. Hon. Members told my right hon. Friend the Secretary of State that she should not be able to sleep at night. If that is the case, Conservative Members must have had 18 years of nightmares. My hon. Friend Laura Moffatt gave a good account of past failings in the national health service. The Opposition have a clear strategy of running down people's opinion of the NHS to pursue a more insidious agenda. The speech of Tony Baldry was an example of that. The debate is not genuinely about overall investment in the NHS but about certain people's concerns not being met because of a restructuring of the way in which health care is provided. Yet, if Conservative Members read some of the diaries of their right hon. and hon. Friends who used to be Ministers, they will realise that some of them openly admit political interference in the formula. [Hon. Members: "Who?"]

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

I shall not give way. Hon. Members can go to a library like anyone else.

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

I have made it clear that I am not giving way.

I am glad to say that I believe that the formula as it is now constructed ensures that people in the most deprived areas get the most funding. That is the right way forward. Each person in my constituency gets £7 less than in the neighbouring constituency of Huddersfield. That is hardly surprising since the economic indicators clearly show poverty in Huddersfield and relative wealth in Colne Valley. We make no excuses for that; the formula is perfectly fair.

We have also ensured locally based provision of health services through the PCTs. All hon. Members should welcome that. Conservative Members often talk about a small state and large people, yet suddenly today, they demand state interference at the most local level. Decisions about the local delivery of services should be made locally.—[Interruption.] I am making a case.

In my PCT, there was huge consultation about the delivery of services. Local people made clear what they wanted from their health service. Thousands of people wrote to me and a case was clearly made to the Government. The Government agreed that the services should cater to local people's needs. People understood that they could join with Huddersfield, which had more money spent on constituents per capita, yet they still preferred locally based services.

Photo of Mark Simmonds Mark Simmonds Shadow Minister (International Development)

Does the hon. Lady agree that she is making a good case for abolishing central Government targets for health care?

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

No, I do not agree because there must be a balance between ensuring that taxpayers' money is spent on the right priorities and local needs. There is no contradiction in stating Government priorities, which, in my experience, usually reflect the concerns of my constituents. For example, let us consider cancer care. It was clear that my constituents wanted the same rate of recovery as the rest of Europe experiences. They were not getting that but we are now well on the way to achieving our targets. I am pleased and proud about that. The hon. Gentleman makes it appear as though my constituents did not want such targets. If they had not wanted them, I would not be here today.

We are conducting several health reviews in my constituency and I have some concerns about them. Local people should be able to make decisions, not in the interests of doctors or administrators, but in those of patients. That is why I asked Sandra Gidley about her view of maternity services. She might be interested to learn that her colleagues on Liberal-run Kirklees council agree with me about midwife-led units. We need to learn much more about how they can play an important part in maternity services if they are properly supported. My constituents are concerned about how that service can be delivered to their benefit. Most of them want a choice in their services, and maternity services are as good an example as any of how choice can work.

A woman who expects to have a perfectly normal birth might want to have her baby at home. That is quite proper, and she is entitled to do that. Should the community decide that it wants a midwife-led unit, it will make that case clearly to the local PCT in the local consultation. People are right to demand from me—as I demand from the health service—that such a unit be run properly and with the right support. We should not therefore set up a maternity service that delivers only 500 babies a year, when there are 3,000 a year being delivered in the Huddersfield royal infirmary. We have to take into consideration not only the number of babies being born in Huddersfield but the fact that we might also have to transfer patients, in the middle of what was expected to be a normal delivery, to the newly built hospital in Halifax, which we are very proud that the Government were able to deliver—no pun intended.

We have to balance the new ways of delivering health and patient care with value for money and with what the public want. The public have made it very clear to me that, if there is to be a midwife-led unit, they want it to have full hospital support nearby.

Photo of David Burrowes David Burrowes Conservative, Enfield, Southgate

The hon. Lady began her speech by talking about collective amnesia. Does she share my concern about the amnesia of the Government, who, before the election, promised that the future of our local accident and emergency unit in Enfield would be safe and secure in their hands? Six months on, however, there are plans to cut that service. Is not that an example of amnesia, in that the Government now appear to support that closure?

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

What would be important would be for the hon. Gentleman's constituents to have a local consultation about accident and emergency services, similar to the one that took place in my constituency. The services there have now greatly improved. I can speak only for my own constituency and my own hospital, but no doubt he will make his own case for the hospital and the accident and emergency services in his constituency.

I understand it when health managers tell me that they want to review services because they want to make them more effective and efficient, safer to deliver and better for patients. They make it clear that they are doing that not because they feel that they are underfunded but because they think that there is a better way of delivering the services. I tell them that they might be right in some cases. However, if they continue to propose new services that, in my constituents' view, favour the administration of the hospital or the doctors to the detriment of the services that my constituents want, we need to listen very carefully to the patients at that point.

In 1996, when the then Government proposed to close the local community hospital, I opposed the closure. The hospital remained open. A clear promise was made to that effect by this Government, and the hospital has remained open. Not only that, but it is flourishing and growing daily. It provides new services that were never thought of before. It used to be regarded as quite a shabby place that the local community paid for out of donations. They felt that those donations made it their own hospital, and they were proud of it. Now, because of this Government's commitment to community hospitals, it delivers surgery day care, which it did not do before. I believe that that hospital is the kind of place that could house a maternity unit, because it would have the support of obstetricians, paediatricians and anaesthetists nearby. My constituents—and the midwives themselves—tell me that they want the kind of service that will ensure that all deliveries are safe.

Conservative Members ignore the fact that we ought to be measuring the positive outcomes of patient care. Patient care changes and develops over the years, and it becomes better. As it does so, we have to adapt to the introduction of new services or treatments or—I have forgotten the other word.

Photo of Kali Mountford Kali Mountford PPS (Rt Hon Des Browne, Chief Secretary), HM Treasury

The hon. Gentleman has helped me greatly.

As medicine changes, we have to change with it, but we must not be led by the nose into thinking that there is only one way of doing things. Services must be locally based and they must respond to local needs. Our consideration of cost-effectiveness must take into account patient outcomes. "Patient outcomes" sounds like horrible management-speak for people getting better. If we look at the number of people getting better, we can see that thousands more people are being treated—

Photo of Julian Lewis Julian Lewis Shadow Minister (Defence) 6:15 pm, 15th November 2005

I hesitate to give advice to Kali Mountford. She has many admirers on this side of the Chamber, and I think that I am right in saying that she entered the House at the same time as I did in 1997. I would merely say to her that in the 1997 Parliament it was acceptable for Labour Members to argue that everything was the fault of the previous Conservative Government. In the 2001 Parliament, it was arguably acceptable for that to happen. However, this is the 2005 Parliament and it is incredible to argue that this is all the fault of a Conservative Government who lost power way back in 1997.

Before I leave the party political part of my speech, I must point out that I would never have imagined that, six months after a general election that the Government won with a majority of 60, the best that the Government could do in a major Opposition day debate would be to get only four Back Benchers—including one whom I believe to be a Parliamentary Private Secretary—to support their ministerial team. It is a sign that all is not well with this Government.

My final point about the hon. Member for Colne Valley is that it is precisely because we like and admire her that it is sad to see her having to speak so defensively about a record that she knows in her heart is not satisfactory. I would not discourage her from doing that because, as time goes on, if the Government continue to try to purvey a message of good news to a country that knows that the news is thoroughly bad they will simply lose credibility.

I come now to the events in the constituencies of New Forest, East, New Forest, West, and Romsey, to which Sandra Gidley briefly referred. I thank her for the way in which she has co-operated with my hon. Friend Mr. Swayne and me in fighting to save the five community hospitals based in our three constituencies. I was sorry to hear the spat between my hon. Friend Mr. Blunt and Laura Moffatt about the fight over which community hospital should be saved in their constituencies. The reality is that if constituencies work together, they maximise their chance of saving all their community hospitals, because this is not a zero-sum game.

When I asked the Secretary of State whether she valued the role of community hospitals I expected her to say yes. However, I also hoped for an answer to the question whether she thought that their closure was a matter of dogma or of economics. It should not be a matter of economics. During our campaign against the closures—which is not over yet, although things are now looking promising for the five hospitals—we discovered that the running of the community hospitals accounted for between only 1 and 2 per cent. of the total operating costs of the PCTs concerned. Those PCTs admitted, without too much pressure, that the reason they were in gross financial deficit had nothing whatever to do with the cost of running the community hospitals. I am only sorry that the Secretary of State was not prepared to concede that point when I asked her to do so.

The reality was that five community hospitals were to be closed. There was, however, supposed to be consultation and originally it appeared that the consultation would be on all the possible options. Option one out of five was to keep all the beds, or at least some of the beds, in all the community hospitals. Option five was to close all the beds in all five hospitals. In between, there was a series of cunningly designed options, such as closing one hospital but keeping others open, or closing two hospitals but keeping others open. It was patently obvious what was being planned. The idea was that the consultation would set hospital against hospital, community against community, and then the PCTs would be able to go back and say, "None of the communities can agree on which of their hospitals should survive, so we will just do what we consider best."

What did the PCTs consider best? Extraordinarily, when the truth was told, they did not like the idea of people being treated in community hospitals. Indeed, one non-executive director of the New Forest PCT, who subsequently became acting chairman for a period, said at an early meeting that treating people in community hospitals rather than in their own homes was archaic. If we wish to develop services to encourage people to be treated in their own homes more than at present, the best way to do that—after all, people do not go into hospital for fun—is to persuade them that if the time comes when their condition deteriorates to the point that they will need in-patient care, those in-patient beds will be available.

I wanted to finish with a few tips and hints for people campaigning on these issues, but something strange is going on nationwide. It is not clear whether it is a movement among PCT bureaucrats or whether they are being surreptitiously encouraged by the Government. The Government say that they value community hospitals and I would like to believe them. If they do, the movement is among bureaucrats. Whatever, there is an attempt to say that community hospitals are not necessary and that people can be treated at home. That smacks of something that we have seen before—what happened to mental health services when care in the community swung the pendulum too far against professional care in institutions.

There is a grain of value in what is being recommended, but the reality is that valued, trusted and loved organisations will be thrown away for the sake of dogma. When that dogma is found to have failed, the unelected bureaucrats, whom no one put into power except the Government, and whom no one can remove except the Government, will no longer be there. It is no good the Government saying to us that such decisions must be taken locally—our answer is that such decisions must be taken democratically.

Photo of Richard Taylor Richard Taylor Independent, Wyre Forest 6:23 pm, 15th November 2005

While I welcome the extra money going into the health service and some of the improvements that have occurred, I find it incredibly hard to understand why only a quarter of trusts are in deficit, when in my area all three of the primary care trusts and the acute trust are desperately in deficit. I want to try to persuade the Government to admit that at least some of the deficits are their fault.

At the Health Committee last week, I asked a chief executive of a strategic health authority:

"is it not also part of your job to tell the Government that with Agenda for Change, GP contracts, consultant contracts, out-of-hours care and all these further reconfigurations, that even though they put extra money in, you do not have enough?"

He replied:

"you are absolutely right that if you look at those examples you gave, whether it is Agenda for Change, the consultant contracts, the GP contracts, all of those cost more money than we originally identified in the arrangements to do it, and we make that very clear to Sir Nigel Crisp and his team when we meet them."

The Government must therefore be aware that some of the deficits are due to their plans.

As an independent Member, I have the immense privilege of being able to attack both the previous Government and this Government. I refer the House to an article in the Journal of the Royal Society of Medicine in 2003, which reviewed all the changes imposed on the NHS up to that date, which it called, "organisational upheaval". I am glad to tell the House that the score is 13 to 12 in the Government's favour, or rather disfavour. From 1982 to 1996, there were 12 reorganisations. From 1997 to 2003, there were a further six. By my counting, since 2003, seven or eight more have taken place. The author of that article concluded:

"perpetual reform is very costly, both in terms of the time and effort invested by managers and other NHS staff, and in terms of the financial costs of establishing the physical fabric of new organisations and of meeting the redundancy or retirement costs of displaced staff."

The NHS staff who speak to me, locally and more widely, make a sincere plea, "Leave us alone. Let us just do our job of caring for patients. And please slow the reforms."

As I said in a debate in Westminster Hall this morning, one of the consequences of deficits in my area is that the acute trust is £20 million to £30 million short. Some of that is because of inefficiency, and I welcome the drive for efficiency-increased productivity. I am saddened, however, that there are threats, yet again, to hospital services in my county.

Apart from threatened reconfigurations, the PCTs have deficits, which affect me and, I suspect, other hon. Members in the form of battles with NICE guidelines. I have had a tremendous battle to get funding for the anti-TNF drugs for rheumatoid arthritis, which are approved by NICE. I am having a battle over biventricular pacemakers, which every cardiologist reckons are far better than the old-fashioned pacemakers, and yet a patient must go before a special complex case panel to be approved to have what is well known to be the most effective form of pacing. There is, of course, a battle over Herceptin, and in my area each case is being examined specifically. There is NICE blight, whereby things that are about to be tested are not even considered by PCTs. Then there are things that are not even on the NICE list, such as the treatment for sleep apnoea. Any Members who are overweight and whose wives tell them that they snore loudly might need that treatment at some point.

My plea is that we should recognise the causes of the deficits, slow down some of the reforms and give the staff time to care for their patients. It is all very well to rule that GPs must do Saturday morning clinics. But who stopped the Saturday morning clinics? The Government accepted the new GP contract, which did just that.

Photo of Paul Burstow Paul Burstow Shadow Spokesperson (Culture, Media and Sport) 6:29 pm, 15th November 2005

We have established that the proposition of the chief executive of the NHS that this is a year of financial correction is a rather useful euphemism for describing the build-up of pressure in the national health service that is causing so much difficulty on the ground, not just for those who are struggling with balancing their budgets but, more importantly, for those who are suffering the consequences of services being dislocated and cut.

By month five of the current financial year, Sutton and Merton PCT, in my area, was already forecasting its current £1.3 million deficit, and it is now forecasting a £5.2 million deficit by the end of the year. As we have heard, however, those figures mask the true magnitude of the problem and the pressures faced by PCTs and other NHS organisations. Notwithstanding its deficit, my PCT has been told by South West London strategic health authority to achieve a surplus of £6.7 million to help bail out other parts of the NHS locally. That means that a gap of £11.9 million must be closed before the end of the year. Moreover, it must all be seen against the PCT's opening deficit of £7.4 million, which in the past year has been funded through non-recurring items such as cuts and delays in projects.

The Secretary of State suggested that the NHS was all right because many NHS organisations broke even. What she forgets is that while they may break even on 31 March, on 1 April their debt is back around their necks, causing difficulties for their organisation and the recovery plans on which many fail to deliver. Most of the deficit on my patch arises not because of management failures and non-provision of services, but because of the challenge to NHS managers and staff to meet the access targets with which the Government confront them. It is a case of over-performance—a lovely phrase that is used when a hospital carries out more operations than was intended during a particular fiscal year. A hospital that provides more treatments becomes a target for pressures to cut budgets and spending. That is another example of historic underfunding of the NHS.

It is against that backdrop of funding pressures in my local health economy that my local health service proposes to close two district general hospitals and replace them with a smaller critical care hospital with fewer beds, underpinned by a network of local care hospitals that will have no beds at all. I fear that that network will never exist. A critical care hospital will open in due course, but it will not provide a satisfactory service without the support of the network because the PCT will not be able to invest in the services that would enable it to operate properly. I hope that the Minister will assure me that the "Better Healthcare Closer to Home" programme on my patch will deliver in full for my constituents and will not leave the legacy of a critical care hospital bursting at the seams because it did not receive the primary care and diagnostic services that it needed.

Let me say something about the wider position in London. The Secretary of State told us that most NHS organisations were not in deficit, but that clearly does not apply to London. Of the 42 NHS organisations providing acute and mental health services, 23 are in deficit, according to their final accounts as recorded recently. It seems that the NHS in London faces a £94 million deficit, with which it must grapple during the current financial year. That is a huge drag on it.

The problem with debates such as this is that they are clouded by inadequate reports from SHAs about the true position. The lack of numbers in some of the reports submitted by their boards, and the obscurity surrounding the level of risk, beggar belief and do not provide a framework in which accountability can exist and Members in all parts of the House can scrutinise the performance of their NHS organisations.

North West London SHA is a case in point. Having been warned consistently by Kensington and Chelsea PCT that the PCT had been in deficit last year, in September, December and February this year the SHA was still reporting that it would break even by the end of the financial year. Then, there was the big surprise at the end of the year when the PCT found itself in a huge financial mess.

All that demonstrates an inherent problem with which the Government have failed to deal. The growing instability in NHS finances will be amplified by the roll-out of payment by results. As a consequence, more NHS organisations will be in difficulty and will struggle to balance their books. The Secretary of State assures us that the present deficit is containable and manageable. She fails to point out, however, that organisation of the NHS is in transition—that it is on the way to becoming a market model and that the deficits will matter far more when the transition is completed. The demand side of the service now holds the whip hand, the commissioners have not been given the strength to do the job, and the Government's proposals for PCT reorganisation have come too late. They have woken up to the problem, but they are shutting the stable door when the horse has bolted way ahead.

The Government's general election manifesto proposed a £250 million or 15 per cent. saving through NHS reorganisation. The final twist came in Sir Nigel Crisp's statement, reported last week, that the NHS planned to increase the role of SHAs and not to allow the new PCTs full control over their budgets until they could demonstrate their ability to deliver their financial plans. Effectively, that constitutes centralised control over NHS finances. The Liberal Democrats do not want it, but the Government seem content to allow it.

I hope that the Minister will give reasons for the proposed change and centralisation. As we approach a year in which funding gaps are widening, the Government propose to reduce funding after the growth of the past few years. I fear that we will have not a soft landing but a rough landing, and that unless the Government get a grip we will have a real problem.

Photo of Mark Simmonds Mark Simmonds Shadow Minister (International Development) 6:37 pm, 15th November 2005

I agree with my hon. Friend Tony Baldry about the deplorable complacency of the Secretary of State's speech. She wanted to talk about anything other than the motion, and her responses to the serious points made by my hon. Friend Mr. Lansley were unacceptable. I can be more positive about Kali Mountford, who made a typically articulate speech. She made a good case for the abolition of central Government targets. Along with the Government's manipulation of the funding formula, mentioned by my hon. Friend Mr. Hunt, those targets are the main reason for the terrible deficits that most PCTs are now experiencing.

I warned the Government that they would find themselves in this position as long ago as November 2001, when I initiated an Adjournment debate in Westminster Hall on the future of Skegness and District hospital. I asked the Minister to reassure my constituents and me that when the PCT ran short of money, it would not close wards. What safeguards would the Government introduce to ensure that wards would not be closed and beds would not be lost? The then Minister of State, Jacqui Smith—who, rather worryingly, is now Minister for Schools—replied

"I reassure them and him that they need not fear for the future of what is an excellent community hospital: there are no plans to close or to downgrade it."——[Hansard, Westminster Hall, 13 November 2001; Vol. 374, c. 237WH.]

On 1 November this year, one ward—50 per cent. of that hospital's wards—closed.

In January 2003, I initiated an Adjournment debate about the future of Pilgrim hospital, the main hospital in my constituency. I asked the then Minister, David Lammy to reassure me that there would be no downgrading of facilities at that important hospital in my constituency. He said

"I want to assure them from the outset"

—"them" being my constituents—

"that they need not fear for the future of their hospital or the future of the NHS under this Labour Government."—[Hansard, 16 January 2003; Vol. 397, c. 919.]

This summer, two wards in Pilgrim hospital, Boston closed, losing 59 beds—another disgrace.

I held a debate in July this year, to which the Under-Secretary Mr. Byrne replied—I see him in his place. I have to say that his response that day was at least more articulate and sensible than either of the two responses that I had received in the previous debates— [Interruption.] Not only did he go to Harvard, he also had an interest in Lincolnshire church architecture, which means that he cannot be all bad. I pointed out that the Government had failed to act in time to stop the ward closures and asked him to put on record his assurance that there would be no further diminution of health care provision in my constituency or elsewhere in Lincolnshire. Even that Minister, however, failed to do so.

My hon. Friend the Member for South-West Surrey may not have known it, but he hit the nail right on the head. In my view, there has been a deliberate policy by the Government to manipulate the public sector funding formula not just in the health service, but across the public sector, to move resources—particularly out of rural areas that have Conservative and sometimes Liberal Democrat MPs—in order to benefit their own MPs, especially in marginal seats. Stephen Hesford has effectively confirmed that today.

Photo of Jeremy Hunt Jeremy Hunt Shadow Minister (Work and Pensions)

Is my hon. Friend aware that the Government have changed the funding formula for the NHS four times since 2001 and that in every single year, they have increased the relative weighting given to social deprivation and decreased the relative weighting given to age and the cost of delivery of local health care?

Photo of Mark Simmonds Mark Simmonds Shadow Minister (International Development)

I am aware of that; my hon. Friend is absolutely right. The crux of the matter is that it is not only areas represented by Labour Members that have pockets of socio-economic deprivation. That needs to be recognised, alongside the sparsity factor, the increasing population and the increasing age of the population.

I represent a constituency on the east Lincolnshire coast, which has a significant number of retired people, particularly those coming from the ex-coal mining constituencies of the midlands, who bring their health problems with them. That needs to be reflected in the funding formula: it is not, but it needs to be. I am not saying that Skegness or the east Lincolnshire coast is alone in that problem; it needs to be recognised around the whole country, where appropriate.

Photo of Graham Stuart Graham Stuart Conservative, Beverley and Holderness

Through you, Mr. Deputy Speaker, may I thank my hon. Friend for becoming a patron of CHANT—the community hospitals acting nationally together campaign group—which was formally launched today? I hope that, he, together with my hon. Friends, Government Members, Liberal Democrat Members and the independent Member will demonstrate their support for CHANT. The same applies in respect of the other place. We are gaining cross-party support for what is a national problem and we need Ministers to respond to it.

Photo of Mark Simmonds Mark Simmonds Shadow Minister (International Development)

I congratulate my hon. Friend on all the work that he has put into getting the CHANT group off the ground. He deserves significant recognition across and outside the House. I am sure that he will be rewarded in his own constituency for the efforts that he has made. I am delighted to see the Conservative Benches so full today: many more Conservative Members will be engaged in improving the provision of health care, not just in our respective constituencies but across the country. The representation on the Government Benches this afternoon provides a marked contrast.

I want to provide some brief statistics to show the consistent underfunding of the East Lincolnshire primary care trust, which serves my constituency and that of my hon. Friend Sir Peter Tapsell, who I am delighted to see in his place. The PCT began on 1 April 2002 with a £2.8 million debt inherited from the former Lincolnshire health authority. In the year 2005–06, it was 8 per cent. off its target share of funding. As much as 36 per cent. of the total underfunding in the Trent strategic health authority area is applicable to the East Lincolnshire PCT, which is one of the 10 worst funded PCTs of the 303 in England. This year, it is £30.3 million below its target level funding.

It is not only the East Lincolnshire PCT that is underfunded; they all are in Lincolnshire. The United Lincolnshire Hospital NHS Trust is £8.1 million in deficit with a £20 million predicted shortfall this year. That has meant two ward closures and 59 beds lost at the Pilgrim hospital and 15 beds, including three palliative care beds, in the Scarborough ward closed on 1 November. As you can imagine, Mr. Deputy Speaker, there was absolute uproar in Skegness, resulting in very well attended public meetings—[Interruption.] Government Members are laughing, but this is a very serious issue. The meetings culminated in setting up a delegation that is coming to Parliament on 30 November. I ask one of the relevant Ministers to meet that delegation—it will include Labour councillors who attended the Secretary of State's surgery but, needless to say, received no response from her—and hear what it has to say. The losers are people living on the east Lincolnshire coast who need that facility. Pilgrim hospital is 42 minutes away along the A52.

Due to pressure from myself and others, future funding was supposed to increase from April 2006—by 13.6 per cent. that year and 12.4 per cent. the following year. It has now become clear, however, why the Government were prepared to acquiesce in that increase in funding. It is because there is going to be a reorganisation, so the PCT may never see the additional money, which may even be transferred from where it was originally going to be spent. In winding up today's debate, will the Minister give an assurance that the money promised will remain in the original area of the East Lincolnshire PCT and that the SHA will permit it to be committed prior to the reorganisation in April 2006?

The two specific problems that I have mentioned are the culture of targets and the manipulation of the funding formula. If only it were as simple as that, but unfortunately, the ambulance trust is now under pressure and it has been proposed that 28 ambulances in Lincolnshire and 42 front-line staff should go. It is ironic that I received a letter from Unison, pleading for my support to fight Government cuts in Lincolnshire. What an irony.

In conclusion, councillors in my constituency have informed me that the Government blocked the acceptance of the local authority's offer to fund the reopening of the ward—they did so for political reasons, as they do not want to alert the electorate to the fact that the NHS in Lincolnshire is underfunded—and thereby ensured the closure of the Scarborough ward in Skegness. I am also told that the Government are politically interfering and manipulating the strategic health authority and the primary care trusts right from the heart—pressurising staff, demanding clearance for all information flows, including for MPs, and blocking spending plans. If true, that is totally unacceptable in what is supposed to be a devolved, patient-receptive NHS.

I want to see health care provision improved in Lincolnshire and elsewhere—not just in areas represented by my right hon. and hon. Friends, but across the United Kingdom. We must all ensure that that happens. Unfortunately, because of the way in which the Government are managing the NHS, it is not.

Photo of Mark Hoban Mark Hoban Conservative, Fareham 6:48 pm, 15th November 2005

I welcome the opportunity to debate the financial deficit in Hampshire, which particularly affects my constituents. My hon. Friend Dr. Lewis referred to the problems of community hospitals in that part of the county. In a way, Mr. Deputy Speaker, I wish I had a community hospital. The problem in Fareham is that, despite recognition for some years that local people need a community hospital and despite the record investment in the NHS to which the Government refer in the amendment, no community hospital will be forthcoming for the next two or three years at least.

What we have seen in Fareham is a much-loved popular local facility—the Blackbrook birthing centre—closed at short notice. I referred to it in an earlier intervention on Sandra Gidley. The Blackbrook birthing centre in my constituency has provided care to mothers—many of whom were born there—for many years. It provides mothers who have given birth elsewhere in other units run by the Portsmouth Hospitals NHS Trust the opportunity to go back for some post-natal care for two or three days to help them to bond with their children. Mothers have also used the centre to receive the hands-on practical advice and care that midwives can give in that unit, which they cannot get elsewhere.

In July this year, the centre was closed with only two weeks' notice. Mothers who had booked to give birth there were told at short notice that they were no longer able to do so because of the combination of staff shortages through sickness and midwives going on maternity leave. Naturally, it was disappointing for mothers to be told that they could not have their children there, but it was also disappointing that the trust did not recognise the problems that the pregnancy of midwives themselves could cause, and that it had to close the unit at such short notice.

I am afraid that this is not the first time that the birthing centre has been closed for those reasons. Having been closed since August 2000 because of staff shortages and sickness, it reopened in June 2001, only to close again in January 2002, until May of that year, again because of staff shortages. Mothers in my constituency are an easy target. They are the first to feel the pinch when there is a shortage of midwives in the local PCT.

Recognising the great outcry across the community at the closure of Blackbrook, the trust committed itself to reviewing the question of its reopening in December, and it pressed ahead with recruiting midwives, despite staffing pressures elsewhere in the system. It agreed to recruit 12 whole-time equivalent students and five other midwifery posts, so that Blackbrook—and the Grange maternity centre, which is in the constituency of my right hon. Friend Mr. Mates—could reopen by the turn of this year.

Local parents have campaigned vigorously to keep both centres in the public eye. I congratulate the "Friends of Blackbrook" and Mel Watson on their excellent work in keeping Blackbrook in the public eye and that of the people of Fareham. But they were stunned, as was I, to discover in September that the trust had postponed the reopening of Blackbrook and the Grange, because it recognised that the financial constraints that have affected all Hampshire's trusts have to be applied to maternity services as well.

In a letter to me, the director of clinical services, nursing and midwifery said:

"You will also be aware of the difficult financial situation affecting both the Trust and all of Hampshire and the Isle of Wight . . . The Board agreed that Maternity Services must now be subject to the same financial controls as all other Trust services, even though this may mean the reopening of Blackbrook and the Grange might be delayed as a result."

Photo of Maria Miller Maria Miller Shadow Minister (Education)

I draw to my hon. Friend's attention the fact that the financial crisis in maternity care stretches as far north in Hampshire as Basingstoke, where we have no 12-week scans for pregnant women. The financial crisis has hit us hard as well, and it is interesting to hear how it is stretching further south.

Photo of Mark Hoban Mark Hoban Conservative, Fareham

Indeed; the problems affecting maternity services stretch right across Hampshire.

Photo of Michael Mates Michael Mates Conservative, East Hampshire

Not only were we subjected to the constraints to which my hon. Friend referred; it had been specifically denied only weeks beforehand that there were any financial disadvantages in reopening the Grange and Blackbrook. The only reason given for the decision was clinical safety, which was patently untrue.

Photo of Mark Hoban Mark Hoban Conservative, Fareham

Indeed. The problem is the continuing uncertainty about the future of the two centres. Despite the trust saying that it will review the situation at the end of the financial year, there is no guarantee that either unit will reopen. It is important that people maintain pressure on hospital trusts when facilities are closed temporarily. My constituents and I fear that at times, such temporary closures are a precursor to closure by stealth—that such closures will last longer and longer, so that the public scrutiny to which a formal closure should be subject goes by the board.

I am grateful to the Hampshire county council overview and scrutiny committee, led by councillor Ray Ellis, for its continuing vigilance on this matter. It is making sure that there is no chance that such facilities will close without the public becoming involved, or without proper consultation taking place.

Photo of Iris Robinson Iris Robinson DUP, Strangford

Will the hon. Gentleman give way?

Photo of Mark Hoban Mark Hoban Conservative, Fareham

I would like to give way, but other Members wish to take part in this debate.

My hon. Friend Mrs. Miller referred to scans, but another related issue that has been brought to my attention is the denial of in vitro fertilisation treatment to would-be mothers across Hampshire. Despite Government guidelines and action taken by the Secretary of State last year to commit to providing one free cycle of IVF treatment to Hampshire's would-be mothers, the PCT has denied that opportunity to those who are perhaps most in need of IVF treatment. The reality is that that opportunity has been denied them because of the financial problems that PCTs in Hampshire face. The deficits are restricting the treatment available to those who want to have a baby.

The Government talk in their amendment about record investment in the NHS, but the experience of many of my constituents—such as mothers who want to use birthing centres, access maternity care or have IVF treatment—is that that investment is not reaching the people of Hampshire. They cannot understand how the Government's promises and spin can be reconciled with the reality on the ground, and the same is true of constituencies elsewhere in Hampshire.

Photo of Stewart Jackson Stewart Jackson Conservative, Peterborough 6:55 pm, 15th November 2005

I am grateful for the opportunity to share with the House the impact of this Government's incompetence and mismanagement on my constituents. In so doing, I pay tribute to the staff and management of my local NHS trusts—the Peterborough and Stamford Hospitals NHS Foundation Trust, and the Greater Peterborough Primary Care Partnership—whose professionalism is enabling them to continue to put patients first, notwithstanding the Department of Health's strategy of buck-passing and neglect. That said, people in Peterborough are fighting back to defend their local NHS facilities. Mary Cook, a former nurse from Orton Goldhay, which is in the constituency of my hon. Friend Mr. Vara, has collected thousands of signatures in protest at ward closures, cuts in bed spaces and the amalgamation of our local PCTs.

Mary Cook is not a Conservative, but she is a special lady. In 1996, she won a national newspaper competition, which enabled her to meet the then Leader of the Opposition, Mr. Blair, and to quiz him on the NHS and how his policies would help Peterborough. At the time, she said that she was satisfied with his response. What is her view today? Last month, she told Peterborough's The Evening Telegraph,

"Looking at his answer now just makes my blood boil. He has more or less gone against everything he told me."

In April 2000, the right hon. Member for Sedgefield, upon the occasion of the opening of a new NHS walk-in centre in my constituency, told the very same newspaper—in breathless, messianic prose that was doubtless written for him:

"Not for the first time, the city is blazing a trail for others to follow. You can't rebuild the NHS overnight . . . what you can do is put in the investment and the reforms to get it right."

So what is the Prime Minister's legacy to my constituents? The Peterborough and Stamford hospitals trust is predicted to be £7.7 million in deficit at the end of this financial year. It has already axed 70 jobs and closed no fewer than three wards and 106 beds. A further 200 jobs are under threat, and cuts of £6.5 million are in the pipeline. Just yesterday, following the local PCT's decision to withdraw £2.5 million-worth of funding, the trust has been ordered to "slow down" elective surgery cases, thus increasing waiting lists and making further cuts inevitable. The Department of Health is happy to preside over the disintegration of local NHS services. It is pressing the trust to meet its statutory obligations under legislation dating from 1990, but it is happy to carry over accumulated structural debt. This dichotomy is unsustainable in its present form.

What is the trust to do? It is faced with external demands—such as consultants' contracts, agency staff, the European working time directive, initiatives such as "Agenda for Change", and a hugely increased drugs bill—but it has not been provided with adequate funds to meet them. Ministers have not addressed this issue.

Even when the Government try to involve the private sector, they are noteworthy for their incompetence. Part of the reason for the structural deficit in Peterborough is the mismanagement of the private finance initiative scheme for the building of a new super-hospital in Bretton Gate, on the site of the Edith Cavell hospital. Initially, the cost to the trust of the project's consultants—more than £5 million—was to be underwritten by the Department of Health. Then, it was not. Then, just £1.9 million was to be underwritten. Then, the whole amount was again to be underwritten. Last week, the hospital trust's chief executive warned:

"We cannot keep running at a loss. We want to give advance warning that jobs are at risk."

The PCT will fare little better, with a forecast deficit of £4.2 million this year. Its chief executive said that the trust was in a "fragile financial state", with a vacancy freeze and staff morale at rock bottom.

Meanwhile, patients face longer waiting lists and further cuts in service provision. My constituent in Walton was forced to wait 88 weeks to have a new digital hearing aid fitted at the audiology department—so much for the public-private partnership, and for the Prime Minister's honeyed words.

The problems that I have described are the results of centralised planning and 300 targets. The Secretary of State's approach is similar to that of Stalin's approach to tractor quotas in the Ukraine, although she does not have his sense of humour, flexibility and sureness of touch.

When will the Government concede that their star rating system is flawed and inaccurate? When will they learn that targets distort clinical priorities and disadvantage patients who need non-targeted, elective surgery but who get pushed to the back of the queue?

The drive to a monolithic culture, disdainful of the views of local people, continues with the Orwellian behemoth that is known as "Commissioning a Patient-Led NHS". That is newspeak, or doublethink. The plans mean that my constituency has taken on a contingent deficit of £23 million from South Cambridgeshire, and they take no account of patients or professionals.

Does the Department of Health care that there are major health inequalities in my constituency? Adult life expectancy is four years lower there than in neighbouring Cambridge, and the local PCT has unique health needs and specialties. It is rare for me to make common cause with Unison, but I applaud the union's efforts to defend local health care in my constituency.

It is time for the Government to acknowledge the crisis, and the fact that they do not have any moral superiority or a monopoly on care about the NHS. Until they do that, we will see more wards closing and more bed spaces lost, rock bottom staff morale and further suffering for my constituents and for people across the country.

Photo of Stewart Jackson Stewart Jackson Conservative, Peterborough

That passes for rapier wit in Glasgow.

What price the Prime Minister's honeyed words and promises today?

Photo of Nick Herbert Nick Herbert Shadow Minister (Home Affairs) 7:02 pm, 15th November 2005

The Secretary of State gave the clear impression that the deficits described by other Opposition Members do not matter. She said that they affected only a small minority of trusts, but all four acute trusts serving my constituents in Arundel and South Downs are in deficit. The Brighton and Sussex University Hospitals Trust has a deficit of £7.5 million, and that will double by April. The St. Richard's hospital in the south-west of my constituency serves my constituents in the Royal West Sussex Trust and has a cumulative deficit of £20 million, and rising. The Surrey and Sussex Healthcare Trust has been referred to already and has a deficit of £29 million, while the Worthing and Southlands Hospitals Trust has a deficit of £5 million, which is forecast to rise to £13 million by March. That represents a total deficit of more than £60 million, and rising, in the acute trusts in West Sussex alone—hardly a chimera.

That deficit affects the trusts' creditors; it is not merely a paper deficit. Ministers will know that many of the trusts are unable to meet their bills, and that means that creditors, including those in the private sector, are being made to wait for payment.

The Secretary of State said that a recovery plan was in place. What does that plan entail in West Sussex? In Worthing and Southlands, it means that two wards will be shut. In the Royal West Sussex Trust, one rehabilitation ward is to be shut, with the consequence that patients are being transferred to Arundel community hospital. That hospital is being told that it can treat fewer local patients than would otherwise be the case.

In 1932, people in Arundel supported the building of the hospital by public subscription. The bricks were paid for by everyone contributing sixpence each to the building fund. Local people have contributed every year to ensure their community hospital's preservation, and they feel very aggrieved that, in effect, it will be taken away from them.

In the Brighton and Sussex University Hospitals Trust, accident and emergency services and major trauma services are being transferred from the Princess Royal hospital in Haywards Heath to the Royal Sussex hospital in Brighton. Again, that is strongly against the wishes of people in the local community.

The Secretary of State gave the game away when she said, on the "Today" programme in June, that some parts of the NHS were "not particularly efficient". She said that

"individual hospital departments, if they are not able to . . . balance their books . . . will find themselves replaced".

Is it not clear, therefore, that the recovery plan really amounts to a closure plan? However, when the Secretary of State says that trusts are not being efficient enough, that is to ignore that the St. Richard's hospital in my constituency is one of the most efficient in the country. It is among the top 15 per cent. of NHS trusts nationally, and has accumulated two of the three possible stars in the Healthcare Commission ratings, yet the Government say that it is not efficient. The truth is its efficiency is being penalised by the deficit that it should not be running up.

The Secretary of State said that deficits were rising in spite of higher resources, but the point is that, in effect, those resources are not available. The King's Fund has pointed out that 73 per cent. of spending increases are being absorbed in cost pressures. Professor Nick Bosanquet of Imperial College has said the same—that 70 per cent. of annual spending rises are being absorbed by inflation.

The Government have fuelled inflationary pressures in the NHS, and made it less possible for trusts to meet their bills. That is not merely due to an increase in existing salary costs as a result of "Agenda for Change" and the new consultant contract: it is because the future spending commitments taken on by the Government are not properly accounted for. They include the PFI schemes, the new primary care contract that is being introduced, and the fact that more staff will be taken on.

Professor Bosanquet has estimated that, in five years, the additional costs will amount to £10 billion a year. That will be funded from within existing NHS budgets, at a time when the increase in spending will be slowing down. By then, our health funding will be nearing French levels. It will account for 10 or 11 per cent. of gross domestic product, but the NHS will face a French-style financial crisis.

Hospital managers have no control over those costs, which in effect are being imposed on them. In a national system, they have no way to vary the costs, and the possibility that they might be able to has been taken away. Mr. Milburn proposed the introduction of foundation hospitals, but that innovation never saw the light of day.

There will, of course, be less in the way of resources for health care if the money being put in is not matched by output. The Treasury's initial measure of NHS productivity showed that it fell by a staggering 15 to 20 per cent. between 1997 and 2003. The Office for National Statistics was told to recalculate the measure, but even its revised figures show that productivity has been falling by as much as 1 per cent. a year since 1997.

Falling productivity means that the NHS needs more resources just to stand still. One reason for that fall in productivity is that there has been an increase in non-productive activity. For example, the latest ONS figures, published last month, show that the number of managers in the NHS in England is increasing three times as fast as the number of clinical staff—that is, doctors and nurses.

The problem is not that more money has not been put in, but that the money has been put in ahead of reform and consequently dissipated. Higher spending has simply fuelled higher costs. The national problems are exacerbated in West Sussex, where our population is rising, and relatively elderly. As Opposition Members have pointed out, the NHS funding formula discriminates against the south-east.

I hope that the Secretary of State and her fellow Ministers recognise that the hospitals in my area face serious problems that must be answered.

Photo of Andrew Murrison Andrew Murrison Shadow Minister (Health) 7:09 pm, 15th November 2005

We have a had a good debate, with 13 contributions from Back Benchers, almost all of which have been good and which, in their own way, have had something to add to the debate. However, I have to say that the debate has been rather better supported by Conservative Members than by Labour Members.

The debate started with a contribution from Sandra Gidley, although it was a pity that we did not hear from Steve Webb, especially as he has Thornbury hospital in his constituency. It is a community hospital near Bristol, and I would have thought that the hon. Gentleman might have liked to talk a little about it.

Laura Moffatt gave us a revisionist romp through the NHS, although my recollection of working in the NHS is rather different from hers. My hon. Friend Mr. Waterson talked about the effect of deficits in an area with an elderly population and needs that may surprise Labour Members. Stephen Hesford did not mention the closure of wards 6 and 7 of Victoria Central hospital, despite being prompted by my hon. Friend Mr. Lansley in his opening remarks. My hon. Friend Tony Baldry talked about the outsourcing of resources and NHS reorganisation, including the fact that it may act as a distraction to achieving a reasonable balance sheet and to achieving for patients.

Kali Mountford made some thoughtful points about maternity services, if I can say so without flattering her too much. That theme was taken up by my hon. Friend Mr. Hoban, who talked about Blackbrook maternity hospital, which has a special place in my heart because it is where my fifth and final daughter was born five years ago—

Photo of Andrew Murrison Andrew Murrison Shadow Minister (Health)

My hon. Friend tempts me. As I was saying, Blackbrook provided excellent care for Henrietta, my wife and me.

My hon. Friend Dr. Lewis gave us some helpful campaigning tips on how to secure the future of one's community hospital and, having visited his area, I hope that his forceful local campaign will ultimately be successful. I am sure that it will. Dr. Taylor was as sage as ever and reminded the House that Ministers have recently applied their micro-management of the NHS to reinstate GP Saturday morning surgeries. He also reminded us that it was the Labour party that removed them in the first place.

Mr. Burstow expressed concern about Sir Nigel Crisp's announcement last week that he will hold back powers from PCTs at strategic health authority level—concerns that we share. My hon. Friend Mark Simmonds will lead a delegation from Skegness—I hope that the Minister will meet it—in support of his community hospitals. My hon. Friend Mr. Jackson talked powerfully about the effects of PCT deficits in his area and the causes of them. Finally, my hon. Friend Nick Herbert discussed his concerns about service cuts in his constituency and the underlying reasons for them, which are familiar to all of us who face that problem.

Nobody disputes the Government's good intentions and they certainly put our constituents' money where their mouth is. However, health outcomes have improved only marginally since 1997 and have, in some instances, declined. International comparisons of mortality and morbidity are unflattering to the UK and output, according to the Office for National Statistics, has fallen.

The Secretary of State wants views on health outside hospital to inform a White Paper, which we understand will be delayed, although we will probably get it at some time in the new year. In the meantime, I wonder what the outcome was of last month's faintly sinister and highly selective deliberative exercise, "Your Health, Your Care, Your Say". The Department must surely by now have some feedback, so perhaps the Minister can share it with us. We understand that the 1,000 or so participants in that jamboree said that they wanted services closer to their communities. Well, there's a surprise. One did not need to spend more than £1 million to discover that. I could have told the Government that for free from what I hear day in and day out in my constituency. Doubtless, we will hear other startlingly obvious revelations with an extraordinary price tag. I resent that spending, because the apparent £1 million cost of the exercise in Birmingham is approximately the sum necessary to keep my community hospitals, which are threatened with closure, open for a year.

That brings me neatly on to one of the main consequences of PCT deficits that has been raised today. It was the subject of a well attended meeting upstairs this morning and the mission of CHANT or Community Hospitals Acting Nationally Together. I confess that that is a tortured acronym—for which we are indebted to my hon. Friend Mr. Stuart, who is heavily bandaged at present—but it grows on one. I hope that it will appeal to the Minister and I am sure that she will hear more of it in coming weeks.

There are four community hospitals in my own constituency—Bradford on Avon, Trowbridge, Warminster and Westbury. The quality that they and 400 like them provide is undisputed. The cost per case treated is capable of manipulation, but the best evidence that we have suggests that community hospitals are highly competitive. They are characterised by strong local support, local fundraising and of course by leagues of friends that have over the years provided the NHS with substantial subsidies.

Community hospitals also have a dedicated work force—people who are expert in what they do and are pleased to serve at the less glamorous margin of our health care system, secure in the knowledge that their largely unsung work is contributing massively to the well-being of their community. Any large organisation must base itself around its skilled work force and Ministers must not assume that those wonderful people will relocate to the nearest district general hospital or shiny new independent sector treatment centre if their hospital is closed down. As community hospitals close, it is likely that many will simply be lost to the NHS altogether.

Despite all the virtues of community hospitals, Ministers do not have a clue how many community hospitals there are, or where they are. I know that because I have asked them. Nor do Ministers know how many are under threat, so we have been forced to conduct our own research. It appears that more than 90 community hospitals are under threat and the figure could be higher. What is more—and this is the crucial point—there appears to be a strong correlation between PCT deficits and community hospital closures.

Many of the PCTs in trouble serve small towns and villages, and we know from the Government's research that they are relatively underfunded. That puts to bed the notion that shutting community hospitals is all about improving health services. It is not: it is all about dealing with Government-inspired deficits, especially in parts of the country with which Ministers have little sympathy. However, care in community hospitals is as cheap as chips compared with similar treatment in a district general hospital. Closing them would surely cost more, as patients default to other providers.

The trouble is that the same Secretary of State who is comfortable using her long screwdriver to micro-manage the NHS—as shown by her insistence last week that PCTs reinstate out-of-hours GP cover—told me when we met a few days ago that hospital closures are entirely a matter for local decision making. Other hon. Members tell me that they have had a similar response and that the Secretary of State is adept at interpreting the comments of local overview and scrutiny committees in a way that creates a pretence of local accountability. Faced with deficits that are largely not of their making, trust chief executives scratch around trying to square away their little bit of NHS budget as they are legally obliged to do, and naturally they light upon community hospitals. The cost of closure to the wider health care economy, including social services and acute units, let alone patients and carers, is of secondary importance and the person in overall command—I hope that the Secretary of State is listening—is unwilling to take charge.

The Secretary of State was pleased to wave a copy of her party's election manifesto at me when we met the other day to discuss community hospitals, especially those in my constituency. The manifesto contains a clear and unambiguous commitment to community hospitals, but PCT deficits are closing them down. We are entitled to ask when the Secretary of State's action will match the rhetoric.

Photo of Jane Kennedy Jane Kennedy Minister of State, Department of Health 7:19 pm, 15th November 2005

Once again, we have had an Opposition day debate that has generated more heat than light from Opposition Members. The Government are taking the NHS forward to a better future, not condemning it to the failures of the past under the previous Government. The NHS is safe with the Government. Access to operations will remain based on need, not on ability to pay.

The Opposition have form. Their 2005 manifesto was clear about what they really wanted to do with the NHS. They wanted to charge for operations. They wanted to make cuts and to take money from mainstream health services and give it as a subsidy to the rich few so that they could jump the queue. They said a lot about deficits during the debate—

Photo of Jane Kennedy Jane Kennedy Minister of State, Department of Health

I shall not give way to the hon. Gentleman because I have only a few minutes in which to respond.

With the Government, there are guaranteed waiting times. Under the main Opposition party, there would be a return to unlimited waiting times. Members from Surrey and Sussex complained of longer waiting times. The House might like to learn that there were 8,900 patients in Surrey and Sussex waiting for out-patient appointments in 1998. At present, there are just 2,700. That is still too many and we acknowledge that we have more to do, but we are the Government who will deliver a total patient waiting time, from beginning to end, of 18 weeks. With this Government, queues are being cut. With that lot on the Opposition Benches, queues would be jumped but only by the rich few. Only the Government will safeguard an NHS that is fair to everyone and personal to each of us—[Interruption.] They really do not like it when the facts are put to them, but I shall give each Member who has spoken the facts about their strategic health authority so that the House can note exactly what is being done in terms of resources in their area.

Photo of Jane Kennedy Jane Kennedy Minister of State, Department of Health

If the hon. Lady will forgive me, I really cannot give way as I am short of time. She has not been in the Chamber for the whole of the debate, and I want to deal with what has been said.

Only the Labour Government will safeguard an NHS that is fair to everyone and personal to each of us, not as the Opposition want—timely health care but only for those who can afford it. It is true that the main Opposition party voted against our extra investment in the NHS—something that they resisted when it was mentioned by a number of my hon. Friends. In 2001, we made the case for a rise in national insurance contributions to pay for a better health service. The British people backed us because they wanted to put right the damage done by the Conservatives over 18 long, miserable years. The Conservatives opposed our extra investment, so they cannot now complain that the NHS is not improving as fast as they would like and expect to be taken seriously.

If the NHS was once more in the hands of the Opposition, they would again make cuts rather than putting in extra investment for extra nurses, doctors and hospitals. Their record on health is one of failure. When they were in power they failed to invest in our national health service and neglected its progress.

Since 2002 and by 2008, £1.2 billion extra will have been invested in the strategic health authority that covers the South Cambridgeshire constituency. That is paying for 5,934 extra nurses and 352 more doctors in training. Mr. Lansley might like to reflect on the fact that, when the Government came to office in 1997, there was a critical shortage of doctors and nurses because the Conservatives had cut training places for the future. Between 1979 and 1997, waiting lists increased by 400,000 and about 60,000 general and acute beds were cut.

Don't you just love the Liberal Democrats—[Interruption.] Of course, I did not mean you, Mr. Deputy Speaker. We really must press the Liberal Democrats for some sensible policies. The main weakness of their position on health is that they never put forward anything other than a wish list of uncosted ideas without realistic timetables. But they have a secret agenda for breaking up the NHS. In "The Orange Book", leading Liberal Democrats such as the hon. Members for Yeovil (Mr. Laws), for Winchester (Mr. Oaten) and for Twickenham (Dr. Cable) advocated scrapping the NHS. They do not often speak about that, and Sandra Gidley certainly did not refer to it, although she said that some things had got better. She should also acknowledge that the number of consultants in the strategic health authority area that covers her constituency has almost doubled and there are 428 more doctors in training. In March 1997, 4,638 people were waiting longer than nine months for in-patient appointments. How many are waiting for in-patient appointments at present? None at all. Not one.

Liberal Democrats persistently face two ways. Their inconsistency is usually dependent on what they believe will buy them the most votes in a locality. For example, they campaign in their localities for foundation trust status, yet they turn their votes against such proposals in the House.

My hon. Friend Laura Moffatt, an acknowledged and fierce campaigner for her local community, noted the tremendous effort made by staff in her local hospital. I hope that she accepts that Crawley primary care trust will receive an increase of about 19.5 per cent. in its resources over the next two years, increasing to £129 million in 2006 and to £141 million in the following year. Far better to be working to recover deficits and improve efficiency and financial management under those circumstances than those that prevailed under the previous Government.

Mr. Waterson should really have a look at what his county council is doing. It would rather pay fines for bed blocking than sort out the problems locally. Resources for the Surrey and Sussex SHA will rise by a total of £1.4 billion.

My hon. Friend Stephen Hesford gave an excellent speech—a robust demolition of Opposition arguments. They really do not like it when the case is put to them. My hon. Friend demonstrated the depth of his knowledge of his constituency and local health services. The Minister of State, my hon. Friend the Member for Doncaster, Central, will be pleased to learn that there are 400 more dentists in the SHA covering Wirral, West, as a result of the extra resources going to the health service. There are 400 more general medical practitioners and 600 more consultants. Opposition Members say that those extra resources are a waste of resources and a waste of time, yet all those extra nurses, doctors and dentists are bringing real and valuable improvements to services, which all our constituents are experiencing.

I am rapidly running out of time. When I listened to the speech of Mr. Burstow, I was confused about the galloping horses and bolting doors. Some Opposition Members made bizarre contributions.

It is not true to say that the Government are not interested in community hospitals. The new generation of community hospitals will deliver integrated care in a single location that will facilitate multidisciplinary teamwork, which will produce even greater improvements in the services that our constituents receive.

As we said at the outset, the NHS is in receipt of record resources as a result of the Government's policy on NHS funding. With that level of investment, all NHS bodies should be able to plan for and achieve financial balance every year. Indeed, the majority of NHS organisations are delivering service improvements and living within their budgets.

I give credit to Dr. Murrison. He is just about the only Conservative Member who paid tribute to the staff who are delivering the improvements. Those staff deserve our sincere gratitude and support. They will get that from the Government.

Question put, That the original words stand part of the Question:—

The House divided: Ayes 231, Noes 312.

Division number 93 NHS Finance

Aye: 231 MPs

No: 312 MPs

Ayes: A-Z by last name


Nos: A-Z by last name


Question accordingly negatived.

Question, That the proposed words be there added, put forthwith, pursuant to Standing Order No. 31 (Questions on amendments), and agreed to

Mr. Deputy Speaker forthwith declared the main Question, as amended, to be agreed to.


That this House welcomes the Government's record levels of investment in the National Health Service, with expenditure set to rise to over £92 billion by 2007–08; notes that by this date £70 billion, more than ever before, will be going to the NHS front line; congratulates the Government on delivering investment and reform, leading to historic improvements to NHS services and capacity, reducing waiting times to their lowest in nearly a generation, from over two years to a maximum of six months, and to a maximum of 18 weeks by 2008, employing nearly a quarter of a million more NHS staff than in 1997, including 78,700 more nurses and 27,400 more doctors, and undertaking the largest hospital building programme in the history of the NHS, including investing £100 million in a community hospitals programme; further notes that the NHS has achieved overall financial balance in each of the past four years, and last year carried a deficit of around only 0.4 per cent. of total resources; compares this with the record of the previous Government which left the NHS with a £460 million deficit in 1996–97 which amounted to almost 1.5 per cent. of total resources; and agrees that, given the record increases in health funding available coupled with the strengthening of Primary Care Trust commissioning, all NHS organisations should be able to live within the resources available to them and to provide excellent services to their populations.