Jeremy Hunt’s plans for NHS competition by stealth

Alice Hood

Secretary of State for Health Jeremy Hunt has proposed new regulations under section 75 of the Health and Social Care Act. The Act became law last March after a long and hard-fought campaign, and these regulations (SI 257) are secondary legislation. This means they’re assumed to simply deliver the detail of the original Act and so, left alone, they would become law on 1 April without a debate or a vote.

But the regulations go far beyond the warm words of ministers during the passage of the Health and Social Care Act. They attempt to sneak a big step towards privatisation through the back door.

During the passage of the Health and Social Care Act, health unions, Royal Colleges and other campaigners worked along with the TUC to raise serious concerns about the way in which the legislation opened up the NHS to a market-based system with an emphasis on competition rather than collaboration. We warned of the damaging consequences that would have for the quality and accessibility of services and for the experiences of patients and NHS staff.

As public concern grew and resistance built in parliament, ministers gave numerous assurances during debates and in correspondence that the legislation was not designed to force compulsory competitive markets onto the NHS, and that local GP commissioners would be free to make decisions in the best interest of patients – choosing to retain NHS providers where they thought this was the best option for their local services.

For example, Earl Howe, the government’s health spokesperson in the Lords, told the House on 6 March 2012:

“commissioners would not have to create markets against the interests of patients. Clinicians will be free to commission services in the way they consider best. We intend to make it clear that commissioners will have a full range of options and that they will be under no legal obligation to create new markets, particularly where competition would not be effective in driving high standards and value for patients. …. this will be made absolutely clear through secondary legislation and supporting guidance as a result of the Bill.” (Hansard col 1691)

In a letter to the new clinical commissioning groups in February 2012, the then Health Secretary Andrew Lansley said:

“I know many of you may have read that you will be forced to fragment services, or to put services out to tender. This is absolutely not the case. It is a fundamental principle of the [Bill] that you as commissioners, not the secretary of state and not regulators should decide when and how competitions should be used… Monitor would not have the power to force you to put services out to competition.”

The regulations now published as SI 257 completely fail to deliver on these assurances. They draw almost all NHS commissioning into a market framework. The circumstances in which commissioners are permitted not to put services out to competition are extremely narrowly drafted, limited to ‘reasons of extreme urgency’ and unspecified ‘technical reasons’. They would mean most of our NHS being opened up to compulsory competitive markets and opened up to EU competition law. A good briefing on the regs by campaigners Keep our NHS Public  is available here.

These restrictions would have the effect of ruling out the current option to use an in-house commissioning process, even where that is what local people support. This option has been exercised since the passage of the Act, notably in the successful Gloucestershire campaign last year, where local campaigners managed to overturn the privatisation of nine hospitals, instead keeping them in the NHS without going out to competition. This was possible under the Act, but will no longer be allowed if these new regulations go through.

The regulations also give the regulator Monitor the power to decide when commissioners have breached rules and step in to impose competition. This could even be done as a result of requests by private companies that have lost NHS contracts.

The imposition of such strict requirements to use competition can only lead to fragmentation of services. Enforced competition will undermine the collaborative ways of working that are essential for good quality care, and will waste resources on transaction costs, fees and a huge increase in costly tendering and competition processes.

Jeremy Hunt has been rumbled, and there are media reports that the pressure could lead him to consider some kind of revision to the regulations. But nothing has actually changed so far, and this could be similar to the smoke and mirrors we saw throughout the battles over the original Bill, such as the so-called ‘listening exercise’. Now is the time to keep the pressure on.

We’re backing a special motion to ‘pray against’ the regulations that has been sponsored by Ed Miliband, Shadow Health Secretary Andy Burnham, Green MP Caroline Lucas and Lib Dem NHS rebel Andrew George. If enough MPs back it, it could lead to debate in Parliament, and the scrutiny that the government are trying so hard to avoid.

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The TUC are also backing efforts to make sure there is a debate in the House of Lords, where many of the original promises were made. The somewhat obscure-sounding House of Lords Secondary Legislation Scrutiny Committee has the job of considering the substance of regulations like this and could raise concerns with the House. They received over 2,000 direct messages from concerned members of the public about the regulations ahead of the deadline earlier this week, and the TUC’s going to work campaign submitted comments from almost 1,200 supporters who wrote to us about it before the deadline earlier this week.

Finally, if you haven’t done so yet, please sign 38 Degrees’ petition against the new regulations.

This article originally appeared on the Touchstone blog.

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