No Gaps

What is the NHS?

It is a difficult question to answer. Some people say it is free at the point of use, paid by general taxation and others say it is public provision of healthcare, and although both of these are important aspects of the NHS, I think the essence of what is the NHS is something more fundamental: no gaps.

In 1946 the government issued a white paper describing the new NHS (Cmd 6761). The document starts with this:

The Bill provides for the establishment of a comprehensive health service in England and Wales. A further Bill to provide for Scotland will be introduced later.All the service, or any part of it, is to be available to everyone in England and Wales. The Bill imposes no limitation on availability – eg,. limitations on financial means, age, sex, employment or vocation, area of residence or insurance qualification.

The NHS was created to provide a comprehensive, universal health service. Everyone was included, there were no exclusions. No gaps. The healthcare provided was comprehensive and every treatment was covered and made available to everyone. No gaps.

This principle has persisted to today. It is so instilled into the NHS that the public assumes that it happens and cannot imagine any other situation. The NHS puts a lot of effort in making sure that services are accessible by everyone, regardless of gender, race, religion, sexuality or disability. When commissioners plan the services for a population they look very carefully at demographics to tailor a service to the region, but they also plan for the minorities in the population to ensure that the services are accessible to them too. The same is true of providers, hospitals make every effort to ensure that everyone can receive their services.

For example, a patient involvement officer told me about a case he had worked on recently. The local hospital found that a particular service had few people from the Afro-Caribbean community and asked him to find out why this was the case. The officer found that elders in this community distrusted people in white coats and this distrust had been passed down through the community via churches and community groups. The patient involvement officer talked with the elders to find out the reasons for their fears and then liaised with the hospital to make changes to allay these fears. Once the elders were reassured the newly gained trust worked its way through the community and that gap had been closed.

To some people, this was patient choice: patients (though ill informed) chose not to use an NHS service. To people who have an obsession for consumer-led patient choice, the issue should stop there. But the NHS has a policy of no gaps deep in its core and the NHS (the providers and the commissioners) ensured that this population was covered.

The no gaps policy is alien to the private sector. The reason is very clear: it is cheaper to provide a one-size-fits-all service for the majority of people, and it is very expensive to provide a service that is guaranteed to cover everyone. When tendering for a general service, the private sector will deliberately exclude the hard to cover populations. On the other hand, the private sector can, and sometimes is, used to fill the gaps, but they will do so at a cost. 

No gaps in the NHS presents one of areas where the government's policy to have more private provision will fail. The government will allow private providers tendered under the section 75 regulations, or through Any Qualified Provider, to provide patient exclusion criteria. In other words, this government legitimises a policy of gaps in healthcare provision. In these exclusion criteria, private providers will cite their incompetencies: they will list their lack of equipment and lack of expertise to treat patients with multiple co-morbidities or who are difficult cases. Patient choice is meaningless if a patient is turned away from a provider because the provider cannot provide a safe and effective service for that patient. However, the government will claim that there is patient choice, while allowing such providers to turn away patients. It will be NHS providers, with their deep rooted no gaps policy, who will treat those patients, because the NHS never turns a patient away.

Section 75 suggested amendments

What's the Problem?

Tucked away in the Health and Social Care Act 2012 is Section 75. It says this:

75 Requirements as to procurement, patient choice and competition
(1) Regulations may impose requirements on the National Health Service Commissioning Board and clinical commissioning groups for the purpose of securing that, in commissioning health care services for the purposes of the NHS, they—
(a) adhere to good practice in relation to procurement;
(b) protect and promote the right of patients to make choices with respect to treatment or other health care services provided for the purposes of the NHS;
(c) do not engage in anti-competitive behaviour which is against the interests of people who use such services.
(2) Requirements imposed by regulations under this section apply to an arrangement for the provision of goods and services only if the value of the consideration attributable to the services is greater than that attributable to the goods.
(3) Regulations under this section may, in particular, impose requirements relating to—
(a) competitive tendering for the provision of services;
(b) the management of conflicts between the interests involved in commissioning services and the interests involved in providing them.
(4) The regulations may provide for the requirements imposed, or such of them as are prescribed, not to apply in relation to arrangements of a prescribed description.

Starting with subsection (2) the important point here is that the section is only about services, not goods so if there is a contract that involves both goods and services, the regulations only apply if the value of the services in the contract is larger than the value of the goods. Subsection (1) gives the usual waffle about patient choice, but significantly, subsection (1c) says that services must not be procured in an anti-competitive way. The section does not define anti-competitive nor does it define the phrase against the interests of people who use such services.

The Explanatory Notes say:

15 Chapter 2 establishes concurrent powers for Monitor, alongside the Office of Fair Trading (OFT), under specific sections of the Competition Act 1998 and Enterprise Act 2002, as they will apply in the health care sector in England. It also provides delegated powers for the Secretary of State to make regulations imposing requirements on commissioners of NHS services, regarding good practice in procurement, protecting patients’ rights to patient choice, imposing prohibitions on anti-competitive conduct and managing potential conflicts of interest, which Monitor will enforce. It is intended that these regulations will enshrine a full range of options for commissioners, including the ability to secure services without competition, where this would be in patients’ interests.

Again, this uses the phrases anti-competitive behaviour and patients' interests but does not define them. The note does say that the regulations should enshrine a full range of options for commissioners and include the cases where services can be procured without competition in patients' interests.

There are two opposing themes here. On the one side the law says that services must be procured in a way that is not anti-competitive and in the patients' interests, and on the other hand there should be full options for services to be procured without competition but also in the patients' interests. To be able to describe both things, you have to define what is competitive and what is anti-competitive, and above all, what in the patients' interests means.

The recently withdrawn SI 257 regulations defines neither. The main sections are 5 and 10. Starting with the latter:

10.—
(1) When commissioning health care services for the purposes of the NHS, a relevant body must not engage in anti-competitive behaviour which is against the interests of people who use health care services for the purposes of the NHS.
(2) An arrangement for the provision of health care services for the purposes of the NHS must not include any restrictions on competition that are not necessary for the attainment of intended outcomes which are beneficial for people who use such services.

Again, these mention competitive and anti-competitive behaviour and the interests of people (or the intended outcomes). The regulations do not define these, other than perhaps, that anti-competitive is the opposite of competitive. Reading this through, however, you get the impression that it is people using the services (ie patients) who are being hurt, and so would have a complaint. Therefore, you would assume that it would be patients who make the complaints. However,

13.—
(1) Monitor may investigate a complaint received by it that a relevant body has failed to comply with a requirement imposed by regulations 2 to 12, or by regulations 39, 42 or 43 of the 2012 Regulations (choice of health service provider).
(2) Monitor may on its own initiative investigate whether a relevant body has failed to comply with a requirement imposed by regulation 10.
(3) Monitor may not investigate a matter which is raised by a complaint under paragraph (1) where the person making the complaint has brought an action under the Public Contracts Regulations 2006 in relation to that matter. 

The two significant things here are that subsection (3) says that the complainant must not have already complained under the Public Contracts Regulations 2006  this instinctively says that the complainant is not a patient, but a potential contractor. Further, subsection (1) says that an investigation does not even need a complainant, Monitor can roam willy-nilly around commissioning land poking its nose into commissioning to see if it is anti-competitive.

Again, these regulations do not define what the patients' interests are, but if the complainant is not a patient it is hard to see how they could successfully bring a complaint when the complaint is not about an action against their interests. It is also important to note that the regulations do not give any time limit, so a contract could be signed, and a provider could be delivering a service, and then another provider can complain. In such a case, Monitor has wide powers to re-tender or alter a the contract which is potentially disruptive and could easily be against the interests of the patients using the service!

Going back to section 5 of the regulations to see the only place where the full range of options are addressed:

5.—
(1) A relevant body may award a new contract for the provision of health care services for the purposes of the NHS to a single provider without advertising an intention to seek offers from providers in relation to that contract where the relevant body is satisfied that the services to which the contract relates are capable of being provided only by that provider.
(2) The services are to be determined as capable of being provided by a single provider only when—
(a) for technical reasons, or for reasons connected with the protection of exclusive rights, the contract may be awarded only to that provider; or
(b) (only if it is strictly necessary) for reasons of extreme urgency brought about by events unforeseeable by, and not attributable to, the relevant body, it is not possible to award the contract to another provider within the time available to the relevant body for securing the provision of the services.

This says that the only cases when competitive tendering can be avoided are for technical reasons (with no definition), for the protection of exclusive rights (protecting those all important patents), or in cases of extreme urgency. This does not seem like a full range of options, indeed, it is a very narrow range and this is the reason why most people say that these regulations indicate that every NHS service must be tendered through competitive tendering.

In response to the complaints about these regulations, Lord Howe, the Minister of State, says about regulation 5:

In practice this criterion will be broad in its application. For example, this may be the case where the requirement is for provision of acute hospital services accessible on single sites; a range of integrated services to be delivered in the community; or where clinical volumes need to be maintained to protect patient safety. It is also likely to be the case for the provision of services in more rural or remote areas of the country.

Well, if Lord Howe thinks that these very broad definitions are how regulation 5 should be used, why doesn't regulation 5 say this? On competitive markets, Lord Howe says:

Furthermore, the regulations would not oblige commissioners to create the conditions for new markets to develop where they consider this unnecessary. For example, commissioners would not be obliged to fragment services to enable providers to compete or stimulate market entry where this would not be in patients' interests.

Again, he uses the term patients' interests without defining what this means. Lord Howe makes a lot of assumptions here, because it is not him that will determine if there is a case to bear on anti-competitive behaviour, or that a provider is an exception. This decision is made by Monitor. The explanatory note says that both Monitor and the NHS Commissioning Board must issue guidance about how commissioners will be compliant with the regulations and that only the former must get the Secretary of State's approval of the guidance. There is a potential for conflicting advice.

These regulations are a mess, there is not enough information to be able to interpret them and the draconian powers of Monitor has made commissioners very wary. This has led to Dr Mike Dixon (the interim president of the official sounding, but purely self appointed club, NHS Clinical Commissioners) to say that the regulations will "force commissioners through expensive procurement" processes and that commissioner "may walk".

So What Next?

The government have withdrawn the regulations because they say that the wording has been misinterpreted. Norman Lamb, Minister of State, said in the Commons:

Concerns have been raised that commissioners would have to tender all services. This is not our intention. And we will amend the regulations.

Lamb is not saying that the regulations are wrong, just that everyone else has misinterpreted them. This means that the new regulations will be more of the same, just worded differently.

So what could the government do now to keep with their idea of a plurality of providers "in patients' interests" without scaring off commissioners? Here are some suggestions:

1. Give a time limit. Ensure that a complaint against commissioners must be within a certain amount of time of the awarding of the tender: a month?
2. Remove the power of Monitor to act as a roving investigator. It should act only upon complains, it should not have the power to initiate the complaint, investigate and adjudicate.
3. Define "in patients' interests". Put the definition in the regulations. For example, the regulations could say that if more than (say) 25% of patients using a service were unhappy with the lack of choice, the contract is deemed not to be in patients' interests. Such a regulation could be powerful in removing poor providers.
4. Provide in the regulations a full range of options for commissioners. For goodness sake, commissioning is hard, don't make it harder. If Lord Howe thinks rural hospitals should be exempt then make the exception in the regulations. Provide a comprehensive list: that is what full range of options means.
5. Only allow patients, or an independent patient advocate, to make the complaint. The advocate should not be an organisation that will tender for the service. The advocate could be a charity, a patient group, a local council, or it could be local Healthwatch. This will make sure that in patients' interests means patients not providers.
6. The regulations should say that if a complaint fails then the complainant should be liable for all the costs of the investigation: both the costs of Monitor and the legal costs of the commissioners. This would have the double benefit of making Monitor cost-neutral (deficit reduction in action) and it would deter speculative and spurious claims.

Without such assurances commissioners will most likely put most contracts out to tender. Commissioners are responsible with public money and hence will try to avoid legal costs. No commissioner can justify spending scarce funds on legal fees rather than healthcare. This will mean that CCGs will employ Section 75 Compliance Officers to ensure that every single contract will be compliant with the regulations. Inevitably, such compliance officers will be risk averse and will competitively tender all contracts unless they are absolutely clear there is no danger of a complaint.

Come on Tim!

The NHS generates a lot of data: for example, data about the number and cost of procedures carried out, waiting times and the numbers and cost of prescriptions. This blog is not about that data, this blog is about governance: the huge number of documents that NHS organisations produce from their meetings.

Every NHS Trust has to hold its board meetings in public and publish its board papers. Under the previous legislation Foundation Trusts could exclude the public from board meetings, but under the Health and Social Care Act 2012 Foundation Trusts must hold board meetings in public and publish board papers. Trusts hold board meetings monthly, every other month or once every three months. (It is bizarre that Hinchingbrooke has just four board meetings a year, with less information made public in each meeting than most trusts provide in their monthly board meetings.) Every year NHS Trusts and Foundation Trusts have to publish an annual report and a quality report. Foundation Trusts also have to publish an annual forward plan outlining their plans for the following three years.

From April 2013 we will see a huge number of new organisations. These include the statutory NHS Commissioning Board (NCB), Clinical Commissioning Group (CCG) boards and local authority Health and Wellbeing Boards (HWB). Further, there will be non-statutory local Healthwatch, NCB regional arms (former SHA clusters), NCB local area teams (made up of former PCT clusters) and Commissioning Support Units (CSU). It is unclear how many of these sub committees and non-statutory organisations will publish their papers.

There are also organisations like Care Quality Commission and Monitor (as well as committees of these organisations like Healthwatch England and the Competition and Cooperation Panel), that are specific to healthcare and organisations like the Office for fair Trading, the Competition Commission and the National Audit Office that periodically perform investigations of the health economy and publish reports. Finally, local authorities also have Oversight and Scrutiny Committees for health, adult social care and children's services. There are many other organisations that affect how NHS and social care services are delivered, but I am sure by now you have got the point that every month there are many hundreds of board papers made public (or should be made public).

So how do you access these papers? The only central repository is Monitor which holds the Annual Reports and Forward Plans for Foundation Trusts only (strictly speaking these reports are laid before Parliament, where they are also available, but Monitor provides the most accessible location). If you want to get access to board papers for NHS and Foundation Trusts you have to hunt around their website for them (the best place is to look under the About Us menu, if the site has one). Local authorities have to publish their own committee papers, but again, there is no standard for how or where on their websites these are published, so you have to hunt around their website to find them. We have yet to see what CCG policies will be about publishing public board papers, but is likely that each CCG will decide where on their own website they publish them in a similar way to Foundation Trusts: again, no standard.

The NCB is open about their own board papers, but appear to accept no responsibility for the organisations that they host, so to find board papers for the regional arms you have to seek out and search their websites, and if you want board papers for local area teams and CSUs you will be very lucky to find anything at all.

This is a mess. It has been a mess for years and it is an insult to democracy that it is difficult for people to access these board papers. It is also an insult to the public that no one has done anything about this issue. Luckily, we have a national Czar called the "National Director for Patients and Information", Tim Kelsey. Unfortunately, giving people access to board papers is nowhere on Tim Kelsey's list of things to do, so it seems I have to do his job for him. The following is a strategy that the NCB should implement.

Central Website

All board papers must be available from a central website. There should be no exclusions, all NHS providers should provide board papers for this website within a month of the meeting. The NCB should also have a policy about historical documents, I suggest that to be able to make any meaningful comparison between organisations we need five years of information, so the NCB should require that all board papers from 2008 to the present should be available, regardless of whether the organisation have had public board papers during that period. (remember: this is about open data.) Similarly, all commissioners (CCGs, local authorities, former PCTs and SHAs) should provide their public board papers for the site. The website should provide search facilities so that users of the website can perform powerful searches across the documents of all organisations.

Open Governance

The National Czar for open data should insist that the board papers of committees, and organisations hosted by his employer (regional arms, local area teams and CSUs) are made public and are published on the central website. Indeed, any government organisation associated with commissioning or providing NHS and social care should make their board papers available through the central website.

Level Playing Field

In the spirit of open data, the National Czar for open data should also lobby the government to ensure that every provider of NHS and social care must publish board papers relevant to the NHS care they deliver. To prevent a Southern Cross type of scandal affecting NHS patients, the government should ensure that all providers of NHS and social care should publish their complete finance board reports. The reason for this is that in many cases the NHS business of such organisations are often the only profitable part of the company, so publishing finance reports of their NHS business will not give a complete picture about the financial health of the company.

The first two suggestions could be started tomorrow with a deadline to have such a website up and running by the end of the year. There is no reason not to have such a website. Any argument about this being expensive to deliver is specious since the government in the recent SI 257 regulations are mandating such a central website for all the NHS procurement tenders, and this potentially will have far more documents that I am suggesting should be made available about governance. The third suggestion - a real "level playing field" of governance - is more difficult, but I think that anyone who is serious about open data would agree that this suggestion is important.

Over to you, Tim Kelsey.

Treasury clawbacks

Here are two interesting quotes taken from the opposition day debate on the NHS on 16th January 2012.

The Secretary of State for Health (Mr Andrew Lansley):We delivered £4.3 billion of cost improvement in the NHS in the last financial year. We are aiming to do more this year. We delivered £2.5 billion, according to the deputy chief executive of the NHS, in the first two quarters. Every penny saved by reducing costs in the NHS is available to be reinvested in the NHS.

Andrew Lansley is known for his absolutist language, it is not "most of the savings" it is "every penny saved". Similarly, the then Minister of State Simon Burns uses bullish language, but in this case, he adds some more details to Lansley's claim:

The Minister of State, Department of Health (Mr Simon Burns):Any and all money made by the NHS is returned straight into care, not to the Treasury.

This is equally absolutist ("any and all money"), but is also mentions the villain that scares people: the Treasury.

However, both are wrong. Over the last financial year the NHS underspent by £1.7bn and the Treasury clawed back £1.4bn of that. Indeed, HSJ (paywalled) say that:

The spokesman also confirmed that the DH recorded a £1.9bn underspend in 2010-11 - but made no use in that year of the "budget exchange" scheme which allows government departments to carry over some unspent funds for use in future years. This means at least £2.9bn of DH funding has been clawed back by the Treasury in the past two years. This is despite the NHS facing a funding settlement for 2011-12 to 2014-15 that is likely to mean its “tightest four-year period in the last 50 years”, according to think tanks the Nuffield Trust and the Institute for Fiscal Studies.

So over two years almost £3bn of NHS money has been clawed back by the Treasury for deficit reduction. This is not what Lansley and Burns were suggesting.

Fair Playing Field

In 2007 Circle bought Nations Healthcare and with this came the Independent Sector Treatment Centre (ISTC) in Nottingham and the Midlands Centre in Burton and a facility in Bradford. The contract for the Burton facility ended in July 2011, and the contract for the Bradford facility ended in June 2010. The following map (pdf) shows the relationship of the treatment centre (in the top right hand corner) to Nottingham University Hospital. Further, the staff who work in the treatment centre are seconded from the University Hospital under a Staff Services Agreement. It should be very clear that the treatment centre is part of the complex and depends on the NHS hospital.

Nations Healthcare was one of the first companies to be contracted to run an ISTC, the New Labour government's mechanism to privatise some NHS services. The company was created in 2002 and has its origins in the US. Nations Healthcare was contracted to open its ISTC in Nottingham in December 2007, but it missed this deadline and the facility opened in July 2008. By this time Nations Healthcare had been taken over by Circle. Thus, the Nottingham NHS Treatment Centre should be regarded as always being a Circle facility because it was not opened until after Circle took over Nations.

The contract with Circle was extremely generous compared to the NHS hospital a short walk next door. The contract is known as a Minimum Take (MT) contract. Unlike Payment by Results (PbR, the payment system for NHS providers) Circle has a guaranteed income known as the "minimum take" and this means that commissioners pay the treatment centre even if they treat fewer than 95% of the patients they are contracted to treat. Further, the commissioners pay national tariff plus 22% for all activity up to 105% of plan and are paid national tariff for any activity over 105%.

Circle crow about how "efficient" they are at Nottingham, claiming on their website in 2012 that they:

"deliver[ed] average productivity gains of 18% each year since opening,"

That is, they claimed that from 2008 to 2012 they had an "average" productivity gain of 18% every year. Put this another way, a procedure that cost £100 in 2008 would cost £45 in 2012: is this possible? A management consultancy group called IPA produced a case study of Circle (Sept 2011) and in this they say:

"Circle has only been delivering services at the Midlands Centre for three years, Nottingham for two years, and Bath for less than a year, so data on long-term productivity trends is limited. However, evidence gathered by the company shows that in 2009, Nottingham had a 22 per cent productivity gain, and the Midlands centre had a 17 per cent productivity gain. Data is not yet available for Bath. At the Midlands Centre the employees have been engaged in a turnaround operation, after a period of low performance under the previous owner, which has set a clear direction." 

This says that two of the facilities that Circle had purchased from Nations (the Nottingham ISTC and the Midlands Centre in Burton) had poor productivity in 2008 and in 2009 there were similar productivity gains at both. The study lays the blame for the poor productivity of the Midlands Centre on Nations Healthcare, however, 2009 is two years after Circle took over Nations (ie they had been running the facilities for 2008 and 2009) and in the case of the Nottingham ISTC, Nations had never run the facility, so the 22% productivity gain in 2009 was an improvement on the poor running of the centre by Circle in 2008.

The last full Annual Report from Circle is for the year ending 31 Dec 2011 (pdf). This report states that  the Nottingham treatment centre was the only profitable part of the business. In 2011 it treated 87,340 patients generating revenue of £51.2m. The operating profit was £2,4m. Compare this to the much smaller CircleBath which treated 33,174 patients (both private and NHS) generating revenues of £13.2m and an operating loss of (£9,156k). Clearly Circle are not good at delivering private healthcare. In 2011, the total loss of Circle Holdings was £32.9m.


Most of the 87,340 patients of the Nottingham treatment centre will be treated on "minimum take", so the £51.2m is 22% more than an NHS hospital would be paid. Since the profit is just 5% of revenue, one has to question whether Circle could make a profit at the Nottingham treatment centre if it was paid like an NHS hospital.


The contract for the Nottingham Treatment centre has been re-awarded to Circle. The contract is for 5 years and the tender advertisement suggests that the contract is worth between £22m and £42m. The tender was handled by Midlands and East SHA on behalf of Principa CCG. The so-called Clinical Commissioning Group did not do the commissioning, instead, it was done on their behalf by one of the four centralised arms of the National Commissioning Board. Nottingham University Hospital was one of the original bidders for the tender, and considering it provides the staff, does the same work at tariff, and is right next door to the treatment centre, it would appear to be a nobrainer that they would get the contract. Details of the contract are currently not available, so we do not know if Circle will be paid at tariff, or on a minimum take. If the contract is on the former (tariff), then it is difficult to see how the ISTC can make a profit (and difficult for Circle to have a sustainable future). If it is the latter (minimum take) then this will go against government policy of a fair playing field.

Outlook and Consequences

Compass have just produced a document outlining what they call Plan B+ "Rebuilding Britain and a Good Society", it's an interesting read and I'll probably post more from it in a later article. This blog post, however, is about where we are going at the moment, and what Osborne's Plan A has achieved. Plan B+ gives a good narrative.

The deficit that everyone goes on about is technically known as the Public Sector Net Borrowing (PSNB) and it is usually quoted as a proportion of Gross Domestic Product. A deficit is never good, and it is puerile and wrong of Conservatives to suggest that Labour wants to keep generating deficits.

Much as I hate using a household analogy for the economy, I will make an exception for this one quote:

"Annual income twenty pounds, annual expenditure nineteen pounds nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery."

This is the Micawber Principle, after Wilkins Micawber who said this in David Copperfield. Governments have to aim for happiness rather than misery. Micawber's misery was a deficit of just 0.1% of total income, the UK government's target is much larger. The Maastricht Treaty says that governments must not exceed a deficit of more than 3%, and during the last government, right up until the financial crash, the UK deficit was below this figure. It is nonsense to say that Labour mishandled the economy (and the public realise this, Coalition MPs find it difficult to spout the trite statement "the mess we inherited").

As a result of the financial crash and the "automatic stabilisers" (that is, increases in welfare payments to pay for people put out of work by the recession) the deficit was 11% in 2010, clearly unsustainable. Just before the 2010 election Alistair Darling's final budget presented a plan to cut the "structural" deficit by a half over the period to 2012/13. This was ambitious, and would have involved pain. However, the Darling plan said that there would be real terms flat funding for the NHS, so it is completely untrue for Conservatives to say that Labour would have cut the NHS budget. Osborne's plan was to cut the deficit faster and eliminate the "structural" deficit entirely by 2015. The sad thing was that no one in the media disputed that this was even possible. As we have seen over the last two and a half years, it wasn't.

The Compass document show this very well in the following table:

The first line is the Darling Plan, the second line is the Osborne Plan and the third line is the adjusted plan after Osborne admitted in the 2012 Autumn Statement that he had failed comprehensively to deliver what he had promised. It is clear from this table that by 2012/13 the adjusted Osborne plan was behind the Darling Plan, whereas Osborne had promised that the deficit would be significantly less at that point:

"Labour had planned £42 billion of spending cuts and tax rises during the 2011/12 and 2012/13 tax years. The tax and spending plans announced by George Osborne in the June 2010 Budget and the Autumn 2010 Spending Review added £22 billion of austerity measures by 2012/13 on top of the Labour plans. And yet, despite all this extra austerity, the deficit is closing much more slowly than was forecast in the June 2010 Budget. George Osborne does not now expect the UK economy to achieve “cyclically adjusted budget balance” – i.e. eliminating the ‘structural’ deficit in the public finances – until 2018, three years later than originally planned." 

Indeed, the government appears to be going backwards, as Compass puts it:

"This is worth emphasising: Two and a half years after the Coalition took office, its central self-appointed aim of closing the “structural deficit” is further away than when it first came to power! At this rate, we can expect that by 2015, the aim will be to close the structural deficit by 2021."

The last sentence is chilling. At the 2009 Conservative Party Conference Osborne promised us five years of austerity and this marked the start of the decline of Conservative poll ratings and this decline meant that Cameron was denied a majority in 2010. In the Autumn Statement last year, Osborne adjusted his plan and promised us eight years of austerity. Compass say that it is more likely to be eleven years. To put this in context, after the second world war the country suffered a period of austerity while infrastructure and industries were rebuilt. (In addition, the country suffered one of its worst winters on record in 1947.) Austerity lasted until 1954, that is, nine years.

There is clearly something wrong if a government, blessed with infrastructure that has not been bombed to pieces, and an educated and healthy population, will give us austerity for longer than after the war when the country was in a far worst state.

So where does this leave the NHS? Under severe threat. We already have an "efficiency saving" target of £20bn (that is, assuming a 4% increase in demand, in 2015 the NHS will deliver 20% more care for, in real terms, the same money as it had in 2010). Very few people think this target is possible, and indeed, the original target set by Andy Burnham in 2010 was £15bn to £20bn, but the Tories have insisted on the upper target. The extension of austerity means that the NHS will have to "save" more. Roy Lilley quoting Prof John Appleby reckons the target will be £50bn by 2020. Lilley says that this is not possible, and an NHS faced with this challenge will revert to co-payments. Osborne's mismanagement of the economy will have dire consequences on our NHS.

AQP Madness

The current Operating Framework says that every PCT Cluster must offer three community services through Any Qualified Provider. The PCT cluster determines what the services are, and for each one it determines what the "qualified" means. That is, the PCT Cluster produces a specification for the services outlining what the provider is expected to be able to do (and just as importantly, what it is not supposed to do). The AQP services were then advertised and providers where invited to register to provide the service, which involved the PCT Cluster determining of the provider was "qualified". AQP providers can be existing NHS providers (which have a lot to lose) as well as voluntary and private providers (which have a lot to gain).

The Department of Health's website that was set up to privatise the NHS is called Supply2Health (henceforth known as the NHS Privatisation website). This website has the list of currently registered AQP providers. The providers for Adult Hearing include Ealing Hospital NHS Trust. This trust provides acute services for Ealing and community health services for Ealing, Brent and Harrow. The following image is a Google Maps image of the area covered by Ealing Hospital.

The NHS Privatisation website says that Ealing Hospital will provide Adult Hearing Services as an AQP provider for the following PCTs:

Ealing
Hammersmith and Fulham
Hounslow
Kensington and Chelsea
Westminster

The area covered by the hospital as an AQP provider is shown here:

The image shows Ealing in the top left, but it also shows that the trust is providing hearing services for a much larger population to the south, east and west. It may be easier to visualise the greater area covered when the two images are combined:

The NHS Privatisation website says that in the area covered by Ealing borough there are three AQP providers of Adult Hearing: Ealing Hospital, West Middlesex University Hospital and InHealth Ltd. Inevitably, Ealing Hospital will lose patients to these competitors, so the only way that the trust can maintain its income is by providing services outside its catchment area, and hence this is why it is an AQP provider from Hounslow in the west to Westminster in the east.

One such "competitor" is West Middlesex University Hospital NHS Trust which covers Hounslow and Richmond-upon-Thames:

The NHS Privatisation website says that West Middlesex University Hospital will provide Adult Hearing Services in the same areas as Ealing Hospital. The combined image for this trust is shown here:

The NHS Privatisation website says that the AQP providers for Hounslow are: West Middlesex University Hospital, Ealing Hospital, InHealth Ltd and Scrivens Ltd.

Thus Ealing Hospital is competing for patients in Houslow who would have gone to West Middlesex Hospital, and West Middlesex is competing for patients in Ealing who would have gone to Ealing Hospital. In both areas there are private AQP providers (InHealth and Scrivens) and the "host" trust will lose patients to them. So to make up for patients lost to them, both NHS trusts are providing hearing services in Hammersmith and Fulham, Kensington and Chelsea, and Westminster.

AQP madness? Sure. Rationally, Ealing Hospital should provide services for Ealing and West Middlesex Hospital should provide the services for Houslow, but AQP is not rational.