Outrage over plan to use private managers in the NHS

5 Jun 08
Unions have reacted with fury to government plans to bring in private sector firms to run failing NHS trusts, while health service professionals have accused the Department of Health of recycling old failed policies.

06 June 2008

Unions have reacted with fury to government plans to bring in private sector firms to run failing NHS trusts, while health service professionals have accused the Department of Health of recycling old failed policies.

In a June 4 document, Developing the NHS performance regime, health minister Ben Bradshaw set out plans for minimum standards of quality, safety and financial management.

Trusts failing to meet the standards – part of a performance management framework that will be distinct from the Healthcare Commission's inspection regime – will be deemed to be 'challenged' and given a set timescale to improve.

Those that fail to lift their performance will have their management team replaced in one of three ways: by a fresh team of NHS managers; takeover by a foundation trust; or by the introduction of a private sector management team under contract.

Dr Jonathan Fielden, chair of the British Medical Association's consultants committee, speaking at the BMA consultants' conference, asked: 'How much do they want to offend their backbenchers? How much do they want to demoralise the talent in the NHS that can do so much if not always played down and insulted by ministers? How little do they know of the complexities of the NHS? You can't just fly in management.'

Unison senior national officer Mike Jackson agreed that it was 'unlikely that private sector managers would have the necessary experience of delivering acute and emergency services to bring long-term benefits'.

He added: 'There is a strong public service ethos in the NHS which would be severely damaged by bringing in private management.'

NHS Confederation policy director Nigel Edwards questioned the need to replace managers. 'In some cases poor management is the problem and new management is needed. In other cases, there are intractable system issues like too many sites, the wrong buildings or over-provision. We need to have solutions that are tailored to the reasons behind the problem,' he said.

Edwards told Public Finance he was 'puzzled' by the emphasis on private management teams, given that ministers had 'previously issued policy in this area'.

The introduction of private managers to turn around failing trusts was first raised in the July 2000 NHS Plan. Managers from high-performing trusts could be sent in, or 'alternatively, expressions of interest could be invited from elsewhere, and subject to a tender from an approved list'.

Former health secretary Alan Milburn confirmed that a register of potential private managers was being set up when he announced the 'franchising' of management at four troubled trusts in January 2002.

But the private sector plan was put into action only once, at the zero star-rated Good Hope Hospital, Birmingham. A team from consultancy Tribal took over in September 2003, pledging to turn the hospital into a three-star trust within three years. Two years later, the trust had just one star and terminated the contract, opting instead to be taken over by Heart of England NHS Foundation Trust.

Fielden pointed to this example, saying: 'There is no evidence that private management is any better in the NHS. The last effort in the West Midlands failed and the hospital was finally turned around by an NHS trust, led by a doctor-manager.'

Bradshaw hit back at the unions, saying bringing in private managers was 'not privatisation', because trust assets and staff would remain in the NHS. He added that the 'private management of Good Hope Hospital did not fail'.

Bradshaw's announcement came a day after the Commons Public Accounts Committee highlighted huge variations in the financial performance of NHS organisations. More than one in five was in deficit, despite an overall surplus of more than half a billion pounds in 2006/07, the MPs found.

The PAC's report on the health service's accounts notes that of the 372 NHS organisations in England, 82 were still in the red at the end of 2006/07, running up a collective deficit of £917m. Around four-fifths of this was accounted for by deficits at just 10% of NHS bodies.

'There is some evidence that financial balance was achieved by slowing down or postponing some health care,' it adds.

It notes that 14 primary care trusts had 'made financial savings by requiring their provider trusts to freeze or slow down non-essential planned treatments'.



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