NHS Reinstatement Bill

Our health, physical, mental and spiritual, are inter-related. In this light, we explore the effects of Government policy towards the NHS. We show a film of a question and answer session between a retired GP, Sylvia Melville, and members of Banbury and Evesham AM. The hope is that the film will raise awareness about major changes taking place in our NHS. The following background information reflects a concern of the Banbury and Evesham Area Quaker Meeting.

The Health and Social Care Act of 2012 abolished the 150 Primary Care Trusts which held budgets for their local populations and replaced them with 211 Clinical Commissioning Groups, notionally headed by GPs but in practice supplemented by managerial and additional staff to provide expertise1. We are no longer on a GP’s list as residents in a particular area - we have now become members of a CCG (this could move us much closer to the American Health Maintenance Organisation (HMO) based on an insurance system model similar to car insurance for example where personal risk is taken into account)2

Regional planning was abandoned with the loss of Strategic Health Authorities and in place of these public bodies which met in public and published board papers came NHS England with Local Teams meeting in private which report up to NHS England but not outwards or downwards to local communities and the wider public.

The over-arching responsibility of the Secretary of State to provide universal and comprehensive health services in England was abandoned and replaced by control by NHS England and regulators ( ‘Monitor’ being a principle one)1. The hundred or so NHS hospital Trusts were compelled to become freestanding foundation trusts or be taken over by established foundation trusts, which are non-profit businesses accountable only to their governors and not to local communities. (The rush to become financially fit for foundation status resulted in the hospital problems in Staffordshire and elsewhere. The Private Financial Initiative status of many hospitals contributed hugely to their difficulties as they, not the Treasury, have to pay interest charges).

Foundation trusts which had faced strict limits on their private work are now permitted to make up to 49% of their income from non-NHS work. This offers them a possible escape from the pressures of frozen budgets and reduced tariff prices for the procedures they undertake (since the internal market principle operated by both major parties uses this arrangement).

The implementation of the 2012 Act cost £3bn3.


Elements of privatisation certainly were taking place well before the 2012 Act and some may well have brought benefits to patients. Now, however, the awarding of contracts to private organisations through the internal commissioning system which the Act has promoted (also known as the purchaser/provider split) – both within the hospital and the primary care services - runs the risk of fragmenting those services. This is because private providers are keen to cherry pick profitable services and leave difficult, complicated and costly provision to the public part of the NHS. The NHS has been forced to compete in this system and to rely on money from more straightforward treatments to fund more expensive and complicated ones. This directly affects patient care, as for example in the case of Nottingham University Hospitals Trust where a private provider so undermined and destabilised the acute dermatology department that it had to close and as a result patients have to travel further for their care4.

If a private provider of a service fails as with Circle at Hinchingbrooke Hospital, Cambridgeshire, which the Care Quality Commission deemed inadequate5 (the first wholly privately run district general hospital) the private company can pull out without any responsibility to patients and local provision must again be provided by the public NHS.

Private providers of healthcare get their budgets indirectly from central government with the aim of making a profit from providing that care. This is best done by reducing costs, usually by reducing staff, paying them less or using less skilled staffing (as in the 111 service). The taxpayer in England is therefore obliged to accept a less satisfactory service to ensure private company profits.

If the NHS is divided into fragmented units and is independent of government supervision then it does make the transition to an insurance based scheme for the NHS, as envisaged in Oliver Letwin’s book Privatising the World (1988), a lot less difficult3. An insurance based scheme is of course the foundation of the US healthcare system, which does not have anything like universal cover and in some cases has resulted in medical bankruptcy.

One third of all contracts in England have gone to private providers between April 2013 and August 2014. These providers include Circle, BUPA, Virgin Care and Care UK. The pace of this privatisation is increasing6

Cost efficiency myths

We have been encouraged to believe that the NHS is unsustainable and unaffordable. Neither claim is justified.

The Commonwealth Fund is a private US foundation that reports on health systems, using its own data as well as that from other organisations. Its 2010 report, involving 20,000 patients in 11 developed countries, found that the NHS was one of the most cost-effective healthcare systems with excellent access to care. Only New Zealand was cheaper and only Switzerland gave better access.

In 2014 the Commonwealth Fund reported again. This time the NHS was ranked highest overall using as criteria: quality of care, access to care, efficiency, equity and healthy lives. Bottom of the list on almost all counts was the US system which spends twice as much as other countries whilst getting worse health outcomes and much worse access7. These facts have not been made clear to the public by the Department of Health.

The NHS has achieved this despite being under resourced. In 2014 a report from the Office for National Statistics showed that the UK spent the least of the G7 countries (9.2% of GDP) on healthcare, tying equal bottom with Italy. The US spends 17.7% of GDP on healthcare with worse health outcomes e.g. higher infant mortality. An EU study reported that the UK was ranked 24th out of 27 EU nations for doctors per head and fewer hospital beds than almost any country in the west1.

More resources are needed – no question. Getting rid of the huge costs of the internal market would be a significant start. Since this was introduced in the 1980s NHS administrative costs have escalated from around 6% to around 15% (in the US administrative costs are nearly 30%). Getting rid of the internal market would save the English NHS between £5 and £10 billion a year3.

The NHS is one of the most civilising achievements of the twentieth century as a peace dividend with its founding commitment to universality of care for all, based on need, free at the point of delivery, irrespective of ability to pay. We must not allow it to be taken from us in the small hours an age before we woke (Thomas Nashe Strange Newes, 1592).

What the Reinstatement bill hopes to achieve

A reversal of the 2012 Act along the lines of the NHS Reinstatement Bill 2015 would open the door to reclaiming services as contracts come to an end. It has several pages but the two page summary at the front summarises the main objectives. It is hoped to introduce it after the election8.

It has not been possible to cover the many issues involved in this concern but the references below may prove useful for Friends wishing to explore further and enable discernment.

Compiled by: Sylvia Melville (retired GP)
April 2015


1 Davis, J et all (2015) NHS for Sale, London, Merlin Press

2 Pollock, A (16 March 2015) Presentation at FMH, Cambridge and Professor Allyson Pollock TedEx event at Exeter (2014) available on You Tube [duration about 15 mins]

3 Sell-off [duration approx. one hour]

4 Nottingham and Nottinghamshire Keep Our NHS public

5 Care Quality Commission Inspection report on Hinchingbrooke Health Care NHS Trust

6 British Medical Journal 2014;349:g7606

7 Commonwealth Fund Mirror, Mirror on the Wall, update 2014

8 NHS Reinstatement Bill both summary and complete version can be found at http://nhsbill2015.org which also shows how to take action if you wish to contact your MP or PPC

Other useful websites

NHS support federation especially for background information

Keep Our NHS Public campaigning organisation

Davis,J and Tallis.R ed.(2013) NHS:SOS London, Oneworld Publications