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New Clause 6 — Secretary of State’s response to a section 65 regulator’s report on an NHS foundation trust

Part of Oral Answers to Questions — Treasury – in the House of Commons at 4:30 pm on 11th March 2014.

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Photo of Grahame Morris Grahame Morris Labour, Easington 4:30 pm, 11th March 2014

I do remember those debates, some of which were very long and acrimonious. I still have the scars on my back. They are a badge of honour, and I am proud to have been in the trenches with hon. Members fighting to preserve our NHS and to save it from the Trojan horse of privatisation.

To return to the matter in hand, the trust special administration process will bring drastic changes to hospital configurations. It represents a move away from the principle of reconfiguration of services on the basis of clinical need in favour of doing so solely on the basis of financial considerations. The justification process starts with the need to save money.

There have been attempts to reassure hon. Members and the general public that the trust special administration process would be enacted only in exceptional circumstances. As in our earlier exchanges about clause 119, hon. Members need to be alive to the situation confronting many NHS trusts, including the fact that about 30 trusts have been identified as being in particular financial difficulties. Those circumstances are not exceptional: come the end of the year and next year, there is a very clear and present danger that they will be not exceptional but normal.

In this situation, the NHS and foundation trusts are struggling, for a variety of reasons, to do more with less. I accept that the burden of the private finance initiative is one of those reasons, but there are others. There have been problems where walk-in treatment centres have closed. NHS spending has fallen in real terms. Almost a third of NHS trusts in England now forecast a deficit at the end of the financial year. There is growing pessimism about the financial health of the NHS, and figures suggest that the number of trusts undergoing the trust special administration regime will grow. As I have said, some 30 trusts have been identified as at risk of closure were clause 119 to be enacted as part of the Bill. Under this Government, it seems that the exceptional circumstances that would trigger the trust special administration process would no longer be exceptional.

I advise hon. Members who want to avoid soon having to take part in campaigns to save accident and emergency or maternity wards in their own constituencies —as has been done by my right hon. Friend Dame Joan Ruddock, my hon. Friends the Members for Lewisham West and Penge (Jim Dowd) and for Lewisham East (Heidi Alexander), and Jeremy Lefroy—to support Labour’s amendment 30.

Clause 119 will permit the Secretary of State, on the recommendation of a trust special administrator, to take actions against hospitals that lie outside the initial scope of the administrator’s investigation. Any organisation that neighbours a trust that is in financial distress, regardless of how popular, successful or robust its services are or how financially viable it is, could be downgraded or closed. The whole House—not just Opposition Members, but Government Members—should be concerned about the implications of the clause.

I have no doubt that, as was outlined by the Chair of the Health Committee, there are cases in which changes are needed in the local health economy that extend beyond the trust that is failing. The fundamental problem is that clause 119 seeks to change the trust special administration process in a way that was never intended. It has the potential radically to change the configuration of our NHS services. When hospitals are identified as being no longer viable, it risks being used as a Trojan horse to privatise our hospitals. [Hon. Members: “Oh!”] There is a groan from Government Members, but one of them suggested a merger between two hospitals in or nearby his constituency in Devon. There are practical issues to consider. We saw what happened in Bournemouth and Poole, where a sensible merger proposal was resisted on the grounds that it was anti-competitive.