I am rather confused. We are nearly there and can tick off the minutes until 7 o'clock, draw a deep breath and go for the final furlong. There is not a great deal in chapter 3 with which we would take issue. Nobody can possibly object to the protection of any part of the service from fraud and unlawful activities. We would certainly support the Government's intention to ensure that lawfulness obtains to the NHS and that we remove fraud wherever we find it. That said, the devil is always in the detail.
When eschewing unlawful activity, there is a danger that we trample over sensitivities that are important, particularly matters to do with confidentiality. As we go through the list of clauses, I will be pressing the Minister to assure the Committee that confidentiality is maintained as a high priority, while respecting the need on occasion to divulge information to appropriate bodies. Where that happens, it needs to be done in a controlled and measured way.
We know from various bits of the public service that when the reins are loosened, sooner or later, because of the size of the public service, we lose control to an extent over that information. That is wrong in itself, but it also gives the public the impression that the system is not copper-bottomed, not—to use another metaphor—watertight. That is to be regretted.
We can think of the incident regarding the Driver and Vehicle Licensing Agency, reported some two or three years ago now, when a rogue individual was able to put information into the public domain and the difficulty that that caused. There have been many other episodes, fortunately mostly minor. That of course was by commission. If we loosen the reins, mistakes will be made. That is inevitable, and material will get to where it should not be, by default. That seems likely as a result of the measures because they give us less of a hold over sensitive information than we had previously. We have to make a judgment as to whether that is acceptable, given our need to ensure that what goes on in the national health service and elsewhere in the public sector is lawful, and to clamp down on fraud, which we understand to be substantial. I would like to hear from the Minister a brief exposition on the extent of the problem that she has identified and requires addressing in chapter 3.
We have just dealt with a chapter in which we suggested that the Government had identified a problem that did not exist and had come up with seven clauses to solve that problem. I am not going to level that accusation at the Government here—broadly, clauses 41 to 52—because we are content that there is fraud within the NHS. We hope that fraud is not rampant, but we accept that there is some in the system. The Government, as a responsible one, will wish to reduce that and to ensure that we get efficiency from our service and that those who are miscreants are brought to book. We will support the Government in that, in a way that we would not necessarily support them in the clauses discussed hitherto. What is important is that we have an assessment of the scale of the problem before we consider whether the remedy proposed, in terms of disclosure, is worth the cost, to put it bluntly.
There are a number of ways in which confidentiality in the NHS is being challenged and threatened all the time. Briefly, we mentioned Connecting for Health—what used to be called NPfIT—and the potential that that has for challenging a guarantee of patient confidentiality. I imagine that the use of Connecting for Health would be considered as part of the measures that the Minister will bring forward to combat fraud and unlawful activities within the NHS. What would be useful in the course of the discussion of the clauses is if the Minister gave us a description of how NPfIT or Connecting for Health might be used or abused in the course of such activities.
In summary, although I broadly welcome the intention behind this set of clauses, I sound a cautionary note. I hope that the Minister will be able to tell us what the problem is and the extent of it, and how by addressing that problem we will not unacceptably damage confidentiality in respect of how sensitive patient records are dealt with.
I hope that by having a brief debate on these issues we can answer some of the legitimate concerns that the hon. Gentleman has raised. He has rightly asked us to demonstrate why it is necessary to extend the range of criminal offences and to give major powers to officers of the Counter Fraud and Security Management Service of the NHS in order to counteract the problems that we face.
In general terms, in order to continue to counter fraud in the NHS, and to enable us to continue to take steps to make it a safer organisation to work in, authorised counter-fraud and security management specialists require relevant information to be produced when undertaking investigations. The hon. Gentleman has generously accepted that that is clearly necessary. In the most serious cases, those specialists will work with the police, who may use their powers of entry, search, seizure and arrest. However, it is not always possible to make use of police powers, because of resource issues. In any event, that is often a drain on valuable police time. The proposed powers will be exercised only by highly trained and accredited NHS counter-fraud and security management specialists. They will be able to apply all of their NHS knowledge and expertise to ensure that only material relevant to a particular investigation is obtained by them and that it is retained within the NHS. All obtaining of documents in that way will be supervised by senior officers in the service.
Later clauses introduce specific criminal offences, such as failure to produce a document on the part of those being investigated. Because we take patient confidentiality extremely seriously, we are introducing an offence of the wrongful disclosure or misuse of information obtained in that way, so that it is clearly reinforced to those involved in the process precisely how seriously we take the role that they will play.
Let me describe the extent and nature of the problem. In the brief period of seven years since the CFSMS was created in 1998, the NHS has benefited from an additional £675 million for better patient care, thanks to the work of that service. That highlights the fact that we face a big problem. If that funding is spent wisely, it could be used to pay for five new hospitals—perhaps not some of the private finance initiative projects that are around, but a number of smaller ones—27,000 heart transplants or 170,000 hip replacements. Let me mention some of the types of cases where this wonderful service is having a big impact. It has an annual budget of £14 million. In just one case in the last year—where it detected, intercepted and prosecuted a cartel that was operating in generic drugs—it recovered £16 million from the company involved. Therefore, in just one case it paid for the running of its own service. However, it has been operating in a number of areas. Overall losses in patient fraud have been cut as a result of the work of the service by 54 per cent. from £171 million to £78 million. That comprises an estimated fall in pharmaceutical patient fraud, which is basically prescription fraud. Dental patient fraud has fallen by 48 per cent. and optical patient fraud by 23 per cent. The hon. Gentleman and other Committee members may be interested to learn that fraud committed by health professionals generally has also fallen.
One reason why we probably do not make more of the work of the counter-fraud service is that we acknowledge that the vast majority of health professionals work quite properly and that the thought of committing fraud does not even come into their heads. Sadly, some health professionals do consider committing fraud, but there has been a reduction in losses caused by health professional fraud of between 43 per cent. and 54 per cent.
Dentistry is one example of the way in which the service might change as a result of understanding how fraud has been committed and acting on suggestions. The amount of money claimed for the recalled attendance allowance has fallen from £14.3 million to £6.6 million almost overnight as a result of changing the form by which dentists made claims for that allowance.
This is a very important area of work. I am intensely proud of the work that staff are doing, and I believe that the measures in these clauses are important in enabling them to continue and to develop that work.
The hon. Member for Westbury expressed specific concerns about patient confidentiality. It is important to reiterate how strongly we all share his view. It is essential that any information obtained through the use of these powers is used appropriately. A new criminal offence is to be introduced in later clauses to cover the unlikely event in which information is disclosed inappropriately, thereby adding another tier of protection to ensure patient confidentiality. For example, a counter fraud and security management specialist commits an offence if they wrongly disclose information in an investigation. If they are found guilty of that offence as a result of the changes that will be made later in the Bill, they could be sentenced to a maximum of two years' imprisonment, or fined, or both. Patient record confidentiality is paramount, so inappropriately disclosing information will not be tolerated. The offence will apply to a range of people, including the person to whom the information is disclosed.
The Bill also contains provisions for certain information in certain cases to be required under court order under the supervision of a court, and there are further provisions to enable us to work with the courts to ensure that, where information important to a fraud case is to be presented to the court but where the detail of the information, although anonymised, may lead to a patient being identified, a court may meet in private in a closed session so that evidence can be presented to it but in a way that protects the identity of the patients involved.
I appreciate the concerns that the hon. Member for Westbury has expressed and the way in which he expressed them. He asked me how the national programme for information technology fitted in with the counter fraud work. Many safeguards are in place, but he will have to forgive me in this instance, as I will have to write to him and to other members of the Committee after I have looked into the matter in more detail, because I simply do not have a detailed answer for him now. I will consider specific concerns, and discuss the query with my officials after our considerations today. I hope that I can reassure him about NPfIT in writing after the sitting.
With that rather quick but, I hope, useful broad-brush explanation about why we believe that the powers are important, I hope that members of the Committee will be content to give these clauses a fair wind.
Clause 41 ordered to stand part of the Bill.
Clause 42 ordered to stand part of the Bill.