Tag Archives: privatisation

Audit Commission in limbo

Following Eric Pickles’ sudden and unexpected decision to shut down the Audit Commission there has been an eery silence.

It emerges that this has been because there was vehement disagreement between the Commission and Pickels’ department over who would be paying for the cost of shutting it all down. One idea that was floated involved passing the costs down to councils through the Commission’s audit fees for its final year. This would have gone down like a lead balloon, and would have unfairly penalised councils for a process they had no power over.

It emerged at this Tuesday’s Audit Committee that the Commission have now agreed with the Department for Communities & Local Government that any costs which aren’t covered by the Commission’s reserves will be borne by central government. There is still no agreement on how to handle the pension fund, but at least it’s confirmed councils won’t be picking up the tab.

In the mean time what happens to the people and the Commission? Well they don’t know! Government has yet to publish a bill which abolishes the Commission. Timing is critical because shutdown can’t happen in the middle of a financial year, any slippage will push things back at least a year.

The Commission are also exploring setting themselves up as a worker-owned mutual, or selling themselves off in some way to existing audit firms. But ministers have yet to say what they might consider approving, any terms or conditions they would seek to apply such transactions etc.

So the highly qualified and experienced staff at the Commission are left to either continue in a situation of serious uncertainty or look elsewhere for a more stable working environment. Pickles has made a complete mess of what was an unnecessary and ideological closure in the first place.

Conservatives risk good governance with plans to axe the Audit Commission

A version of this post appeared on the Liberal Conspiracy

I was astonished to learn today that Eric Pickles will be axing the Audit Commission. Or more precisely, according to the leaked memo on the FT site, the commission will be privatised. Pickles is notorious for being ideologically wedded to cuts as shown from his time as leader of Bradford Council.

From the Telegraph’s one-sided report you’d think the Commission were a bunch of no-good layabouts responsible for, among other things, the terror of the fortnightly bin collection which keeps all good Tories awake at night.

No doubt mistakes have been made by the Commission at times, and they have overpaid some top staff – but which public or private sector organisation hasn’t in recent times?

In my three years on the Audit Committee at Brighton & Hove City Council I have been struck by the conscientious, helpful and detailed work Audit Commission staff have done for the council. The Commission has also helped to make the performance of public bodies more accountable, such as with the OnePlace site which barely got the chance to get going before being canned.

All the staff are experienced and understand local government – because that’s what they do. They also are public servants and take their duties seriously. It must be especially galling that these highly skilled, dedicated staff have been given the axe in a way that, without any consultation or debate, goes against all that might be called ‘good governance’.

How on earth does Pickles think we are going to get the same kind of scrutiny of our public bodies from corporate auditors, inexperienced in local government, and who failed to prevent a litany of corporate fraud and failures? Furthermore, why are private-sector corporate auditors going to be any cheaper to hire in than the Audit Commission who didn’t need to make a profit from their work?

As public bodies continue to be rocked by the cuts and upheavals being rained down on them, I don’t think that now is a sensible time to also completely uproot the key scrutiny and overview body which works to ensure services are robust and money well spent.

If Pickles wanted some genuine savings he could have simplified the framework used to audit local government services. There would be plenty of people, including those in the Commission, with good suggestions on how to streamline the audit framework. Instead, as I understand it, he’s ditched the entire framework and now the Commission too.

I’m appalled by this political meddling in what is an arms-length commission to hold local government to account. This is yet another ill-judged, ideological and unnecessary cut which will end up costing us all a lot more in the long term.

(Updated 14/8/10 to include a link to the Liberal Conspiracy, and include paragraph on saving through simplifying the audit framework.)

What evidence that Lansley’s plans will improve NHS results?

As I’ve been appointed the local Green finance spokesperson this letter, which I submitted to The Argus, was my last as local health spokesperson:

While the current NHS structures are by no means perfect, Conservative minister Andrew Lansley’s plans for the NHS threaten at least three years of massive change, disruption and uncertainty, with no evidence to show any improvements will be the result.

These changes are being foisted on us because they ‘feel right’ to Lansley. That feeling has probably been helped along by financial contributions to his office by the head of Care UK – one of the firms that stands to most benefit from these reforms.

The sad fact is that the majority of GPs won’t have the necessary skills to organise commissioning and so will end up hiring those who do, the sacked managers who will be selling back their services to the NHS at inflated rates as independent contractors.

GPs aren’t keen on becoming managers running half-year long tendering processes, they are more interested in making people better. NHS workers certainly don’t want to see their pay and conditions threatened by being transferred to private providers. And I see no reason why taxpayers should stump up for corporate healthcare firms’ profits when we are being treated by our great public health service.

Greens firmly oppose these changes, which take Labour’s health privatisation schemes to their distasteful conclusion.

Sincerely,

Cllr Jason Kitcat, Green Group Health spokesperson

Speech: Responding to GP-led clinic scrutiny report

I presented this speech in response to a scrutiny panel report I contributed to being presented to full council 28th January 2010. Nobody answered my question at the end of the speech:

I would like to thank Cllr Denise Cobb who was chair of HOSC at the time for agreeing to create this panel after several months of questions on these matters by myself and other members.

I also thank the panel Chair Cllr Alford for his very even handed and co-operative working, as well as Cllr Allen, with whom it always a pleasure to serve with. My thanks to our officer Giles Rossington for his excellent support. I do commend this report to members.

This report is very timely given the continued pressure to further privatise parts of the NHS and package public services off to private businesses.

The panel’s concerns over the tender process favouring larger corporations should trigger alarm bells for all those worried about the future of the NHS. Similarly how such changes are consulted upon with the public was cause for concern with the panel and continue to be a public issue of importance.

These private contracts are riven with problems. The President of the British Orthopaedic Association recently wrote to The Times highlighting grave concerns over their quality control and service levels. A study of one private treatment centre found two third of operations showed poor technique and that after 3 years 18% needed revision operations compared to a 0.9% NHS-wide rate.

Cataract operations at a private treatment centre in Oxfordshire have cost up to 600% over the odds and performed only 93 of 572 contracted procedures for half a year. Meanwhile eye operations in a private contract treatment centre in Portsmouth have cost seven times more than they would on the NHS.

Health service experts the King’s Fund argue these contracts are a drain on Primary Care Trust finances. At a 2008 HOSC meeting a clinician from Brighton & Sussex University Hospitals Trust admitted that the private orthopaedic procedures alone were costing them £2-3 million a year.

The chosen contractor for Brighton’s clinic, Care UK, do have serious ongoing questions over their ability to provide consistent high quality care in our area as well as the rest of the country. In spite… or perhaps because of this… their annual healthcare profit has been in double digit growth for years, including 44% growth in profit for 2009.

Clearly the Conservative Party want more of this kind of privatisation when their 2010 health manifesto states that they aim:

“To give patients even more choice, we will open up the NHS to include new independent and voluntary sector providers…”

We recently learnt that the chairman of Care UK and his wife are giving tens of thousands to fund the Conservative shadow health secretary Andrew Lansley’s office.

So, the question I must ask the Conservative group is…. Is this the kind of privatising corporate ‘greed is good’ politics we can expect if David Cameron wins the general election?

More evidence that private treatment centres are expensive

Further to my earlier mega-post on health privatisation which focussed primarily on the local Sussex Orthopaedic Treatment Centre, some more news has emerged about the true cost of these privately run NHS centres:

  • The Times reports on a study of hip operations sent to a treatment centre in Weston-super-Mare where two-thirds of operations showed poor surgical technique and 3 years since operation a whopping 18% had undergone or were waiting for a revision operation. The NHS-wide rate for such follow-up procedures is 0.9%. These revision operations are expensive, so on top of the treatment centres being more expensive per procedure, they are also costing taxpayers more due to the remedial work needed.
  • The Times also has a comment piece by Michael Bell, President of the British Orthopaedic Association, which is critical on the lack of data to monitor quality and the disjointed nature of treatment centre operations.

Using the private sector to provide frontline NHS services not only runs contrary to the principle of public service, but again and again is shown to provide worse value and worse quality. Neither Tories nor Labour seem able to see beyond their false sacred cow of private = efficient.

Of course private companies do provide value and quality, look at the Apple iPod, but it’s a completely different market and set of pressures to providing public services. Perhaps if we stopped this trend of calling citizens ‘customers’ we could reset the mindset which seems to want to turn everything into a business.

Fighting for a public-spirited NHS: Stopping the new profit-based contracts of ISTCs and AMPS

December has been extremely hectic with lots of residents group meetings, council work and so on.

This month I’ve spoken to the Planning Committee to oppose the demoltion of the old Royal Alex. I’ve spoken to a very eager green assembly at Brighton & Hove High School for Girls, attended a wonderful ORG Advisory Board meeting, been to the Mayor’s Christmas Reception, attended an Audit Committee meeting and more…

The council meeting on 4th December was a marathon event running from 4pm until after 11pm. The Green Group presented a number of motions all with a common theme of health. (The motions are page 65 onwards in this PDF, with amendments in this separate PDF, the webcast is here).

I presented a motion expressing concerns over the NHS’ use of new contractual schemes that encourage the use of large, profit-driven corporations. I’ve written up my speech notes and the motion below. I provoked a furious response from both Tories and Labour who claimed I misunderstood the NHS where GP practices have ‘always been private’. Yes, they are private firms (partnerships usually) but they work on small scales within their communities. The corporations now coming into the arena are enormous, multinationals even. They can be running clinics and surgeries across the country with GPs, nurses and other staff on contracts, NOT as partners in the business. Not only does this change the quality of care and employment provided, it is already proving to be a more expensive way of providing healthcare. Why should we be spending more taxpayer money for healthcare when a portion of it goes to corporate profit?

I recognise that suppliers for equipment (like MRIs) or drug manufacturers also look for a profit, and sometimes that is a problem. But when we look at the frontline delivery of care being for-profit, I have serious concerns – as do others like Unison and The King’s Fund. I want as much of every taxpayer pound going to helping people and NOT to boosting the balance sheet of some distant corporation who will be taking money away from our local economy.

So on to the arguments in full (which have been updated to take into account some new information following the council meeting):

The motion I presented was about protecting NHS services from corporate profiteering. Its theme was about championing NHS staff and the great work they do. Two new contractual schemes have been created by the Labour government which are cause for serious concerns: ‘Alternative Provider Medical Services’ (APMS) and ‘Independent Specialist Treatment Centres’ (ISTC). These have been couched in terms of ‘innovation’ and ‘choice’ but what they in fact do is open NHS services to corporations instead of the traditional partnerships where profit stayed with the partners.

I know the good doctors, nurses and professionals of the NHS can innovate and they don’t need the threat of these contracts to do so.

I have two main concerns regarding these contracts: The quality of care they provide and the costs involved.

Quality of Care

The Sussex Orthopaedic Treatment Centre, a centre run by Care UK for our local hospital trust under an ISTC contract, has only recently emerged from ‘special measures’ from the Healthcare Commission who expressed serious concerns after an inspection.

The Healthcare Commission and Unison have both argued that there is insufficient data to monitor the quality of care at centres run under these contracts. (Sources: Healthcare CommUnison [PDF])

There have also been problems with commercial confidentiality being used to restrict or delay access to information on the centres’ operations and value for money measures. At the last meeting of Brighton & Hove’s Health Overview & Scrutiny Committee we were faced with such a situation (see 3.16 on page 34, for example, in this PDF). I formally requested the information through the Primary Care Trust and I am pleased that most of it has now been released (though it hadn’t been released to the Committee by the Council meeting, however a Tory and Labour speaker both had been directly sent the figures by the Trust ahead of the meeting).

Costs

These contracts are truly extraordinary, breathtaking for many unfamiliar with the details. The operators are paid regardless of the number of procedures they conduct, in the words of a Department of Health officer “Payment would be made in full even if the defined number of procedures had not been undertaken” (48.3 in the minutes). So if they are contracted to undertake 5,000 a year but only do 500, they will be paid as if they had done 5,000 — apparently to help them with the planning and capital investment required. But the corporations aren’t just paid the ‘standard’ NHS fee for a procedure used for internal accounting with NHS Trusts, no in fact they are paid a premium of at least 11.2% (See this letter).

No wonder the King’s Fund argue that the contracts are a drain on Primary Care Trusts’ finances (Source). At the last Health Overview & Scrutiny Committee a representative of the Brighton & Sussex University Hospitals Trusts admitted that they were losing £2-3 million a year on orthopaedic procedures alone. This was due to the SOTC taking only the most straightforward procedures (which would cost less than the notional fee) leaving the hospitals to take the complex cases which would cost more than the internal fee they would be paid by the NHS. (See 48.9 in the minutes) So not only was the SOTC being paid regardless of the number of procedures, but it was also cherry picking the most profitable patients leaving the NHS Trust to pick up bill for the complicated cases with co-moribidity. It’s no surprise then that in September The Observer reported that private firms are bidding on £1.25 billion worth of contracts in the NHS for these kinds of centres (Source: Observer). Care UK, who run the SOTC, are the number one provider for these contracts having last year dealt with 170,864 patients through their centres under these contractual arrangements (Source: Ben Bradshaw MP in Hansard). Care UK’s adjusted operating profit increased by 35% in 2007 and in the first half of 2008 by 37% (Care UK Financial Reports). Their Chief Executive earns over half a million pounds a year. Care UK have specifically credited ISTCs as being a source of their revenue growth. A few days after the council meeting at which I presented the motion, Care UK were announced as the preferred bidder for a new city health centre. No wonder Care UK sent so many people to attend our last Health committee meeting! After all the hedged answers here was the same corporation taking on another part of our city’s health services. Despite the growing credit crunch and economic downturn which is putting pressure on tax returns, the government are injecting tax payer money into corporate profit margins. They should instead be focussing on patients and the hard working public sector staff who care for them. I will keep fighting to protect the NHS and patient interest.

I issued two press releases on this here and here.

NOTICE OF MOTION: KEEPING NHS SERVICES PUBLIC

“Since 2006 large private companies have been able to take over or establish GP practices under ‘Alternative Provider Medical Services Contracts’ (APMSC). This new approach, where the need for corporate profit conflicts with patient needs, threatens the trusted model of a partnership of GPs owning and running a surgery for their patients. The city of Brighton & Hove now has five GP practices run by ChilversMcCrea Healthcare. This council notes with concern that in privately run NHS services including GP practices, polyclinics and independent specialist treatment centres (ISTCs):

* Bids from traditional GP partnerships are often undercut by multi-national health companies;

* Doctors work on shorter term contracts leading to increased staff turnover and dramatically less continuity of care for patients;

* Important information on the cost and level of service provided becomes hidden from scrutiny under the cloak of ‘commercial confidentialit

* Proposals are constructed to keep profitable services private while leaving publicly-funded services to pick up the complex, costly cases leaving any cost savings in private hands. UNISON, the King’s Fund and the House of Commons Health Committee have all raised concerns with these new contractual agreements. At the Health Overview & Scrutiny Committee’s meeting on 5th November Brighton & Sussex Universities NHS Trust acknowledged a £2-3 million per annum loss for handling the complex cases left to them by the privately-run Sussex Orthopaedic Treatment Centre, which focuses only on simple cases without co-morbidity.

Given that the Brighton & Hove Primary Care Trust is currently calling for bids on a new GP-led healthcare centre; this council:

* Rejects the creeping privatisation of NHS service;

* Expresses concern over the financial impact of the Sussex Orthopaedic Treatment Centre;

* And asks the Chief Executive to write to Alan Johnson, Secretary of State for Health and Darren Grayson, Chief Executive of the local PCT asking them to cease further APMSC and ISTC contracts and to reject corporate bids for the proposed GP-led health centre.”

Proposed by: Cllr Jason Kitcat Seconded by: Cllr Sven Rufus