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Are the corporates holding the NHS to ransom?



In terms of political campaigning, the message that the NHS ‘reforms’ were unelected or undemocratic, and cost the ‘hard working taxpayer’ billions, is admittedly quite a good one. As political market positioning, however, this puts the #NHS in roughly the same place as an illegal war in Iraq, or a change to the GCSE examination system, or High Speed 2. It has always felt that the motivator of the ‘people being lied to’ is an apt one regarding the “democratic deficit”, and this is after all theoretically and pragmatically why millions do not vote every General Election. However, the disillusionment of voting for any political party is possibly equally divided amongst all political parties, with some more so than others, with Tory voters wondering how and why Mid Staffs and Morecambe Bay could have happened under Labour’s watch, and Labour voters wondering how the Liberal Democrats could have used weak arguments about competition law and ‘integration’ to ramraid section 75 in the House of Lords.

Whichever side of the fence you sit on regarding the ‘corporate capture’ of public health in this jurisdiction, whether you’re talking about standard packaging of cigarettes or minimum alcohol pricing, it is clear that the Health and Social Care Act (2012) has changed the landscape. Like an asteroid from outer space, it’s in a way intriguing how and where the Health and Social Care Act (2012) came from. Indeed, the vast majority of contracts awarded under ‘section 75′ and its equally notorious Regulations to the private sector is a testament to the efficacy of a policy which transfers resources from the public to the private sector. Part of the argument against this has been that the private sector introduces a level of repetition, waste and inefficiency substantially more than the public sector in healthcare, and the conceptualisation that there is a real ‘market’ in the NHS is an academically faulty one. A second part of the argument that this is tinkering with, to an enormous detriment, with an important societal institution of England which is held in much respect. A similar argument has been given for why Oxford and Cambridge should be given so much reverance as institutuions in the education sector and budget, when it might be more fitting that the devotion to them is manifest through the culture and heritage budget. But like Oxbridge daily, a huge number of real ‘transactions’, though perhaps not “millions”, takes place. The NHS might be a ‘sacred cow’ for some, but it is equally a powerful brand. Andy Burnham says rather mischievously that he does not wish the NHS to become, simply. a “blue and white logo”, or words to that effect, but the power of the NHS brand is illustrated that outsourcing of NHS services is done under the powerful NHS brand with massive brand loyalty.

The outsourcing of NHS services, and indeed exporting of NHS services, is part of the phenomenon where successful governments have wished to make ‘the NHS work pay’, i.e. the “hard working” NHS can pay its own way in modern England. Even better, it can ‘pay its bills’ but drawing a little salary of its own. Granted that the income might not be as huge as £20bn of Nicholson/McKinsey savings, but essentially the right wing do not like this fundamental shift of emphasis. The “change of agenda” of the NHS is prone to be dressed up as a ‘conspiracy theory’ by members of the UK Labour Party, but it is a statement of fact that the statutory purpose of directors of companies under English law is to promote the success of the company; success is defined narrowly as generating a shareholder dividend. This lends itself to the idea that private companies fulfilling NHS functions, such as domestic or multinational corporates, might be a ‘good investment’ as part of an investment portfolio, returning good profit for relatively little risk. That logic is, of course, not that daft, given that the privatised NHS market is an oligopoly, to be occupied by the usual suspects. Privatisation is inherently unpopular now with the English voting public, and the current government has put rocket boosters on a privatisation policy which has been advancing under both Labour and the Conservatives. Like energy, or broadband, despite a purported wish to ‘lower barriers to entry’ and to reward ‘value for money’ and ‘innovation’, and the usual rhetoric of Conservative memes, the contracts go to the same people, often with ongoing allegations of fraud, to deliver the same unconscionable profit for directors and shareholders for offering roughly the same ‘goods and services’ in the same crowded markets.

The ‘campaign’ against the Health and Social Care Act (2012) therefore rumbles on, and is likely to do so until the inevitable General Election to be held on May 7th 2015. Ed Miliband has successfully done what many Labour politicians have feared to do previously, and that he is: set himself the agenda, and decide to follow through his arguments. This is of course in total contrast to Lord Mandelson, who was the future once, like Lord Digby Jones, who have been fast to take to the airwaves to rubbish Ed Miliband.

Why wait for Ed

But the res ipsa loquitur – this is a popular, populist policy, which has public backing, based on sound economic and legal arguments, with a clear policy motive (of delivering genuinely good value for the customer rather than high profit for a corporate). nPower has responded yesterday “a sop to Ed”, which arguably assumes that a Miliband government is a vaguely realistic possibility. Another item of evidence that a Miliband government is a realistic possibility has been the effect that this policy has had on the share price of utilities, so much so had leaks of this policy been leaked to the public ahead of the official announcement Team Miliband might have offended in civil law the use of financially sensitive information in our jurisdiction.

The damage of the ‘corporates holding the country to ransom’ narrative could be more damaging than one first expects, and this is for a number of reasons. Firstly, it is widely held, at least in political circles, that the Cameron/Clegg government is much more corporatilist than the previous Thatcher Conservative administrations, and that Cameron/Clegg have gone ‘further and faster’ than would have been possible under the likes of Thatcher, Bottomley or Ken Clarke. Secondly, the question of who drives policy is still a ‘slow burn’ issue, thanks to the successful endeavours of “38 degrees”, “Spinwatch” and “Social Investigations” (inter alia). Whilst the notion of the Unions having ‘beer and sandwiches’ is of historic interest perhaps, and indeed David Cameron would still like to whip people up into hating the unions through mechanisms such as the Lobbying Act, the mud sticking from how hedge funds appear to have called many shots in health policies is not that pleasant. This second issue of stakeholder involvement is a critical one, in that the public, even if they have horrific members of the late 1970s ‘Winter of Discontent’, have a sentiment that public sector nurses ‘do a valuable job’ and that individual membership of a Union is a democratic and laudable right.

Thirdly, the oligopoly of private provider corporates do stand, and have benefited, from the Health and Social Care Act. So this is not a question of idle speculation about privatisation – this is privatisation which is much further advanced than, for obvious reasons, Royal Mail, though the political spectacle of floating the NHS on the London Stock Exchange or AIM market is not one either main political party should currently like to entertain. Fourthly, and possibly most importantly, is the idea that the corporates on this occasion have ‘overplayed their hand’. Angela Knight, whom many people will remember for defending the behaviour of the equally uncompetitive and unpopular bankers, has been sent into battle to talk about ‘blackouts‘ and impending disaster through the short time window in which corporates can, instead, demonstrate to the rest of society that they are indeed good corporate citizens and worthy of public trust and respect. This idea of foreign-owned corporates ‘turning the lights out’ on England has of course gone down like a lead balloon, and will be in the subconscious linked to unions ‘refusing to clear rubbish up’, and so forth. The one big problem here is that Unions represent democratic bodies, but hedge funds do not.

And, finally of course, is the idea of who actually has economic, social and political power in England. Members of unions are indeed the backbone of making the NHS function (take for example UNISON’s campaigning of safe nursing staffing levels), and therefore have a legitimate say in how to ‘performance manage’ the NHS. Where frontline employee-employer relationships has been poor has been to the clear detriment of places within the service, such as the union dispute in Hinchingbrooke. The argument that there is essentially nothing wrong with transferring ‘public’ functions of the NHS to the private sector is undermined by the initial findings that David Nicholson has already had to grapple with hard-nosed issues of where competition law has been to the detriment of patient clinical care, and that any real-time underfunding of the NHS is likely to lead to backdoor rationing of services within the NHS. The ultimate merging of universal credit, ‘whole person care’ and individualised budgets could be the ultimate policy plank for any party to transfer the State duty to provide a comprehensive, free-at-the-point-of-need, universal service to one where the individual/budget holder makes his own mistakes and good budgetary decisions (and takes full responsibility for him- or her-self). As the debates about the East Coast railway and the privatisation of the Royal Mail demonstrated this week in Brighton. the idea of state-run services are popular with Union members if not with the predominantly social-democratic ‘for the public good’ members of the Labour Party leadership.

‘One Nation Labour’ can be sold, and indeed has been sold, as a doctrine where no vested interest takes control, and this is important for the three planks of Ed Miliband’s approach, economy, society and the political process. However, the NHA Party with protagonists Dr Jacky Davis and Dr Clive Peedell might equally wish to argue that the only final way to break free from this political ‘tug of war’ would be to ‘allocate your resources’ in a party focused on sorting out the NHS. They might argue that all the major parties have policy ‘blood on their hands’, e.g. the ‘private finance initiative’ proposed by Tory David Willetts in 1993, elaborated on in a major Tory thinktank in c.1997, wave of PFI contracts from Coopers and Lybrand just before Blair came to power, and further implementation of PFI under Gordon Brown and George Osborne. The concept of ‘corporates holding the country to ransom’, which the BBC and smaller media providers find hard to cope with, is an attractive one for many ‘ordinary’ voters who feel altogether disenfranchised from the political process, especially on the NHS.

If, on top of that, the notion that corporates “holding the NHS to ransom” curries favour with members of the general public ahead of how represented in the main media, Ed Miliband could find himself with the political movement on the NHS he has so long yearned for. You can already see the seeds of these theme being sown by Andy Burnham MP in his main speech to Conference in Brighton in 2013, and in subsequent copy (for example, in the Mirror or the Belfast Telegraph) that the NHS is turning into the failed system of US-style hospitals. For policy wonks, the comparison with US-style hospitals is particularly sensitive, given how Kaiser Permanente has been touted by some powerful and influential as a paradigm to follow, e.g.

Conclusion The NHS can learn from Kaiser’s integrated approach, the focus on chronic diseases and their effective management, the emphasis placed on self care, the role of intermediate care, and the leadership provided by doctors in developing and supporting this model of care.”

This is not just an issue of domestic politics, as at the moment there is no sign that the Conservative government wishes to scrutinise even the US-EU free trade agreement, regarding the ‘status’ of the NHS. The fight goes on.

Shibley’s CV is here.

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