The NHS and privatisation: now GP practices will be opened up to private providers

Written by Tony Millett.


They’re marching from Jarrow again – this time it is not about the lack of jobs during the 1930s depression. (*) This time the protest is against the creeping privatisation of the NHS.

A local expression of this dismay and concern came in a recent letter to The Observer  (August 10) – written in response to an example of inappropriate commercialisation of a learning disabilities care home in Doncaster.

The writer, Dr Mike Bishop, is a retired GP who served the NHS for 40 years and now lives in West Overton.  He highlights the ‘tragic effects of profit before care’:  “In an area where hands-on care is the business, the most valuable resource a company takes on is the existing staff.”

“To reduce the pay of experienced, committed staff by up to 35 per cent shows ignorance and disrespect.  For this group to withdraw their services and reconsider their futures is a tragedy for vulnerable patients and a recipe for a commercial and public-relations disaster.”

The way, he wrote, “some areas of the service are being degraded makes me weep”. And he asked when the politicians will wake-up to what is happening to the NHS.

Campaigners against NHS privatisation have just been presented with another target: NHS England has said that all new GP contracts will be open to private providers.  As the doctors’ journal PULSE asked in its headline: “Is this the ‘death knell’ of traditional general practice?”

The Section 75 regulations, which are part of the coalition government’s root and branch NHS reforms, finally made it through the House of Lords after a rearguard action against failed.  They quite blatantly open the NHS up to competition law – and thus to some mandatory tendering of services to private companies.

These regulations have not been gathering dust.  The majority of new contracts to provide NHS services signed off last year went to private companies.  The Financial Times recently estimated that about £5.8billion of NHS contracts are currently being advertised to private sector providers.

Recently a government MP (not the MP for Devizes) wrote to his local newspaper saying all was well with the NHS.  At one point he stated: “The reforms which we have introduced are enabling £1bn in back office savings to be redirected into front line care enabling 1,700 more nurses and 7,000 more doctors to be employed.”

We can note his sly “…to be redirected…” rather than “…have been redirected…”.  But he gives no source at all for this figure and it is doubtful he can find one.

We know in Wiltshire that the Clinical Commissioning Group (CCG) is spending more on ‘back office’ costs than its predecessor Primary Care Trust.  And we know that the budgets for the three regulators (CQC, Monitor and the Trust Development Authority) have all gone up this year – one of them wanted a 66 per cent increase.

Part of the ‘back office’ – the polite word for the more usual ‘NHS bureaucracy’ – work is now done by the Clinical Support Units (CSUs) which were set up to provide these services for CCGs.  They employed thousands of staff from the PCTs and other bodies the reforms abolished – and were supposed to become stand-alone, autonomous organisations by 2016.

This process is steaming ahead and has already opened the door to bidders from outside the NHS.  So the fate of CSUs brings us back to privatisation – or externalisation as the official transitional documents euphemistically put it.

Sixteen bidders have been selected in the first stage of re-defining the CSUs.  These include all the current CSUs either on their own or with third parties including Capita, BT and KPMG – i.e. multinationals into which the CSUs may be consumed.

One NHS manager explained to Marlborough News Online that this could solve the NHS’s ‘CSU problem’ in one of two ways: “Either the private organisations will pitch this as loss leaders and knock the CSUs out of the picture, or the CSUs will be swallowed up by the likes of Capita and BT because of their staffs’ knowledge and specialisms.”

And we are not talking about a negligible part of the NHS empire.  The combined income of the nineteen CSUs is about £800million.

So this ‘all’s well on the Titanic’ MP will now have to subtract from his £1bn in savings money that will go not to frontline staff, but to shareholders of companies and to pay first the inflated salaries of their directors, and secondly the inflated salaries private companies will offer to lure staff away from the NHS.

The future of GP surgeries following the government’s decision embodied in Section 75 will be uncertain to say the least.  There are, of course, private GP practices, but the vast majority are and always have been independent partnerships funded and regulated by the NHS.

How the arrival on the GPs’ doorsteps of the big beasts of private health care will fare is anyone’s guess.  The problem is that doctors, despite their involvement in the CCGs as commissioners of services, are not a happy bunch – many believe they are sailing pretty close to the iceberg.

This is how one GP Partner responded to PULSE’s exclusive report on the opening of new GP contracts to private providers: “Next it will be opening up existing contracts to all private providers…however I suspect many of us would probably feel relieved if our contracts were taken over by someone else.  The current contract gives GPs totally unfair contract terms and a level of funding that makes practices almost non-viable.”

“The patients (which includes us) will suffer most. It can’t get much worse than it already is for primary care medical staff.”

There is one unintended consequence for this move towards privatising GPs: what happens when doctors working for “Angel Healthcare Inc” sit on a CCG (which has to have clinical membership) and hands out a huge contract for another primary care or acute service to “Angel Healthcare Inc”?

Or perhaps it is an intended consequence – completing the privatisation circle.

However, the privatisation bandwagon has just shed a wheel.  Serco has announced it is withdrawing from its clinical NHS contracts – having lost £18million.

As the respected health service blogger Roy Lilley wrote: “Why should the private sector be any better at running NHS services than the NHS? The simple answer is it isn't.”

“Because NHS staff come to work and wear a different badge does not make the systemic problems of the NHS go away. There are too many patients and not enough money. Sustainability is as much of a problem to the private sector as it is the NHS.”

* You can follow the march here – they reach London on Saturday (September 6.)