Privatisation. It’s a word which strikes fear into the hearts of progressives everywhere. Perhaps understandably so; previous governments have made a complete mess of privatising our NHS. From signing contracts for building hospitals without reading the small print to providing poor healthcare, privatisation has often been a failure.
That doesn’t mean it can’t be done though and it certainly doesn’t mean it isn’t needed. The uncomfortable truth is that our beloved NHS is unsustainable. Expenditure on healthcare has rocketed from £75 billion in 2000 to almost £130 billion in 2013. As healthcare improves, the number of elderly patients served by the health service increases. It is a vicious cycle.
So what is the liberal solution? Let’s look at the solutions politicians are currently trying. Increasing taxation regularly to fund the NHS is fundamentally illiberal and unsustainable – it puts an unnecessary and unfair burden on workers. The only other option is borrowing the funds. That is clearly also unsustainable as it is merely kicking the problem into the long grass.
As far as I can tell there’s only one solution and it’s pretty radical. More private companies need to bid for public contracts if the NHS is to stay afloat. This cannot be done in the same laissez-faire way it has been under previous governments. It needs a strong healthcare regulator which is there to impose heavy fines on hospitals which fail to provide excellent service. This healthcare regulator should meticulously assess applications for contracts and ensure companies have robust plans to provide fantastic patient care.
There is an argument that paying profit-making companies is more expensive than having state-run healthcare. Of course, we are paying private companies to make profit. However, basic economics means that private companies have to be efficient in order to win contracts. While government bodies tend to overspend, private companies cannot afford to do so. If properly regulated, private companies will spend your hard-earned money more efficiently than a government body ever would.
Let’s take a look at our friends across the channel. According to the WHO France has the best healthcare system in the world. France’s healthcare system is a public-private cooperative in which 35% of hospital beds are provided by private companies and the rest come from the public sector. The French pay compulsory health insurance, which is effectively a tax as it is a set proportion of income. Patients then pay around 30% of the cost of healthcare check-ups or consultations. Personally I believe that healthcare should be free at the point of use so I’d rather the state paid the costs. The point is that the current system cannot provide sustainable healthcare in the modern world. We have to explore other options.
Privatisation is needed. Fast.
* A Liberal in Leeds is the pseudonym for a Lib Dem member. His identity is known to the LDV team.
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107 Comments
” Expenditure on healthcare has rocketed from £75 million in 2000 to almost £130 million in 2013.”
I suspect the NHS spends more than £130 million on paperclips…
Argh, yes… oops. I think that should say billion Stuart. Need to send a quick email to the editor! 😉
Thomas, only 15, I thought you were early 20s. A good article. It is important to get workers approval or at least indifference when it comes to NHS reforms in general.
I saw the big NHS reorganisation in the last parliament as unecesssary and the same with schools, but when it comes to basic financial advice most people in the industry probably prefer a voucher system compared to state takeover. So really a lot depends on the attitudes of the existing workforce.
Stuart, Thomas Shakespeare. Just inflated the figures by a factor of 1000.
We need to spend much more on disease prevention. Public Health England estimates that 40% of all disease is avoidable. We as a society, through education and an evidence-based ‘carrot and stick’ policy approach need to cut the burden of illness which costs the NHS so much and destroys the quality of life of so many people, sometimes unnecessarily. Look at smoking, for example. Even the NHS estimates that it results in the premature death of around 100,000 people in in the UK every year. We also need to learn to self-manage minor ailments much better too.
Thanks Eddie, you’re too kind! I agree we need to be careful about how we go about reform & make sure NHS staff are on board. I think that it needs doing though. I like the idea of looking in to a voucher system.
I agree that disease prevention is a key part of NHS reform Judy, but I think with an ageing population more still needs to be done.
PS A good, thought-provoking article Thomas. As private companies are answerable to their shareholders, that can sometimes shift the focus away from patient care. Our NHS is, in fact, one of the best health systems in the world: http://www.theguardian.com/society/2014/jun/17/nhs-health
You are right, we do need to take a look at how some other countries in Europe deliver better health outcomes. Having said that, some regions in the UK, such as the South West have better health outcomes than anywhere else in Europe, within our existing NHS system. It’s a complicated picture, but I don’t think privatisation is the answer at the moment.
Oh dear, A Liberal in Leeds, I’m afraid the NHS needs more privatisation like a hole in the head. I’m sorry to say the thrust of your article reveals a deep lack of knowledge.
Take for example . New Craigs Psychiatric Hospital on the outskirts of Inverness (formerly in D. Alexander’s constituency). The building contract lasts 25 years but the land will be held by the private finance company for 99 years. Malcolm Iredale, finance director for NHS Highland, said: “At the time the deal was the best deal that we could get. “I think it is very easy to look back and say we could do things differently. “I think it is difficult to say would we do the same deal again.”.
In Edinburgh, the contract for the new Edinburgh Royal Infirmary building lasts 25 years but the lease of on the land is for 130 years. he NHS will have to pay a total of £1.26 billion for the privately built Edinburgh Royal Infirmary – and still not own it. An Evening News investigation has discovered that while other hospitals built under private finance initiatives (PFI) eventually transfer to NHS ownership, the Little France site will not.
It means that by 2028, NHS Lothian will have effectively paid for the hospital seven times over but it will remain the property of private operator Consort.
As a patient at the Royal, I can confirm that the meals are virtually inedible and travel from Wiltshire where they are made, to Glasgow where they are stored, to Edinburgh where they are partially eaten but mostly end up in the bin.
After Iraq, PFI was the next biggest of Blair’s follies – and I’m afraid that the Lib Dems went along with it in the Scottish Executive coalition. If Mr Shakespeare gets his way I’m afraid some of us will be looking for a new political home.
France spends 11% of GDP on healthcare. We spend 9%. (Germany, 11%. Belgium 11%, Switzerland 11%, Netherlands 12%)
Possibly, before we decry the “spend more on the NHS” approach and recommend following France’s example we should look at the face that they’re spending 25% more on their health system than we are…
(Figures from here)
http://data.worldbank.org/indicator/SH.XPD.TOTL.ZS?order=wbapi_data_value_2013+wbapi_data_value+wbapi_data_value-last&sort=asc
As an aside increasing taxes does not necessarily put a burden on the workers. You can target the top 1% who can easily afford to pay more taxes.
As far as NHS privatisation is concerned what you find is that the private sector only want to do what is profitable and if you want to maintain the principle of the NHS; free at the point of delivery then you are likely to find that the burden on the taxpayer goes up. Also you put in perverse incentives and end up with care scandals such as the one in Staffordshire. So the best way to organise the NHS is to work from the evidence Base rather than ideology.
The amount of money wasted through the purchasing/contracting process alone is utterly mind-boggling. There are also many areas where the NHS ‘purchaser’ does not have a clue as to what to specify in terms of the contract and has to rely upon the provider to ‘spec’ up their own contracts
It was Lord Ashdown, who said, I believe, “No taxation without explanation”. If it really is money that the NHS lacks, then let’s have the courage to propose the introduction of a hypothecated ‘Health Tax’, payable by all those currently paying Income Tax and collected by HMRC. I certainly would not object to paying a small amount extra from my modest personal income if I knew where it was going to be spent.
What is increasing the cost of healthcare is the increased number of so called managers who process crazy schemes to promote daft concepts like patient choice that to a large degree are meaningless white elephants.
Patients generally do not want to select their consultant or hospital instead they want to be treated promptly at the nearest facility that can perform the procedure safely and effectively. They want joined up thinking when it comes to discharge so that no person leaves hospital without the medication that they need, initial follow up arranged and any additional support via district nurses etc already in place – that helps reduce the readmission rate and keeps costs down.
It would appear that one of the biggest drains on the resources of the NHS is not the treatment of patients but the rental agreements brought about by the P.F.I so that the government could pretend we were upgrading the facilities in the health service while appearing to make it look as though we were not spending money.
Privatisation is not the answer increased efficiency and reintegration of services will reduce costs, encourage best practice and return to the British public a health service that they can be proud of.
A well written piece and broadly speaking you are correct. However, the biggest obstacle to any change is the inability to consider than any change should be contemplated. While other systems are now clearly better than ours, at similar cost, and with universal coverage we still hear that the NHS is the “envy of the world” This is just no longer true but it remains a barrier to constructive discussion about change.
Ian “What is increasing the cost of healthcare is the increased number of so called managers ”
The number of managers went down significantly under the coalition and the number of clinical staff went up .
David Raw – you seem to think PFI is the same as ‘privatisation’. Simply wrong
The one real experience of a private company running an NHS hospital wasn’t exactly successful – https://en.wikipedia.org/wiki/Hinchingbrooke_Hospital
Wow! A very mixed response. I agree with Alan that all this talk of the NHS being the “envy of the world” or “unqiue” is very unhelpful. By all means argue that a state NHS is necessary for good health care but this sort of rhetoric does not equate to sustainable and efficient healthcare.
In relation to Andrew’s point about %GDP I think even if the NHS is affordable today doesn’t mean it will be in 10 or 20 years time, especially with an ageing population.
“The NHS needs privatisation like a hole in the head”. As I said in my article,David, I don’t think past failures in implementation mean that privatisation will always be a failure. If we have a strong healthcare regulator to allow the NHS to write its own contracts, privatisation can be done on the NHS’ own terms. This will prevent the PFI building disasters you mentioned and the ones I linked to in my article.
Sorry if I havent responded to your specific comment but there are just so many of them ! 🙂
@ Simon McGrath “you seem to think PFI is the same as ‘privatisation’. Simply wrong”
Simon, you assume far too much. I certainly don’t think PFI is the same as privatisation – even though the philosophy behind it comes from the same ‘open to the market stable’. In short, it’s you that is “simply wrong”..
On your second point – perhaps you could give figures to back your point that includes “managers” employed in the private sector ? I, for one, don’t particularly want Richard Branson (who now has a major grip on the GP commissioniung market) to select managers responsible for my health.
An interesting debate. I will make some observations rather than weighing in directly.
1. The NHS needs to reform because of cost pressures. This is true, but risks conflating two issues and avoiding a third. Public services ought to be reformed to improve them in terms of cost-effectiveness and performance whether or not they face cost pressures; separately cost pressures exist and must be faced up to whether or not there are effective reforms to hand. The issue that is avoided is what kind of reform is actually going to work. The default seems to be marketisation of some sort, perhaps because we haven’t heard of a compelling alternative reform agenda from opponents of marketisation.
2. Politically, try to change the health system and you will be called every bad name under the sun. We rely on the health service, we, rightly, demand that it will be there for us when we need it. We are all suspicious of the reasons for any change. Obama has faced this, Blair faced it, the coalition faced it. This will happen whatever reforms are proposed.
3. Markets work. That is to say that a service subject to market forces will generally perform better than one that isn’t. This is an observation, but is often treated as a statement of (malign) values by the left, for whom it is an inconvenient truth.
4. Privatisation is related to marketisation but is not the same thing. If the government commissions a service and specifies how it must be delivered to the last detail, it is largely preventing the process by which competitive players improve their offer. It may well pay more for less compared to doing it in house. PFIs do come with hugely complex secret contracts specifying the services, and this is pretty far removed from the transparent marketplace of Adam Smith.
@Joe Otten 29th Dec ’15 – 5:30pm
‘ Markets work. That is to say that a service subject to market forces will generally perform better than one that isn’t. This is an observation, but is often treated as a statement of (malign) values by the left, for whom it is an inconvenient truth.’
No. It’s a statement of value by you. If you wish to point to a specific market, mediated to a specific degree by a specific set of rules and/or political control, and have a base control to successfully and scientifically measure it against, you can try and make an observation to that effect. That there would necessarily follow a discussion as to what we actually mean by ‘markets’ – the degree to which they operate ‘purely’ and how this determines the definition – would illustrate the degree to which this utterance is about your values more than it is about objective truths.
Someone might as well say ‘Socialism works. That is to say a society subject to socialism will generally perform better than one that isn’t.’ They’d be displaying exactly the same rigorous analysis that you are – no clear definition of terms, or evidence, or evaluation. Just airing their own opinion. Which is fine – but it’s not a fact.
Hi Joe
I absolutely agree that privatisation is a politically difficult topic – the electorate absolutely hate it! However I also think we need reform and imo privatisation has its part to play in that.
In relation to Bolano’s point I think that, broadly speaking, markets do work. When companies are competing for contracts they need to provide not only reasonable prices but also good service. As I said though I believe a key ingredient of privatisation which we have been missing is a healthcare regulator with teeth; a regulator which writes the contracts for the companies to sign and has the power to close under-performing private hospitals. That way the NHS can have privatisation on its own terms.
A Liberal in Leeds “markets do work – they need to provide … reasonable prices but also good service”.
If only. Utilities – record fine for NPOwer in December I see after many years of poor service. They are not alone. As for competitive pricing. Apart from the CEO and the inept OfGem does anyone else think their pricing truly operates independently of each other?
Then there’s public transport. Many rural areas have nothing more than a skeleton bus service compared to what they once enjoyed. So much for competition. Also, I don’t remember the train fares going into free fall either. Not to mention the provider on the East Coast line that failed all together and had to be bailed out by the State.
The nation’s health service is too precious a service to be traded as some some of commodity. As for those that live in the ‘unprofitable’ rural areas or suffering from ‘non profitable chronic ill health’, including mental health, carer respite care etc etc (it’s a long list); if you think profit will deliver I can only say that I totally disagree.
Hi A Liberal in Leeds,
‘In relation to Bolano’s point I think that, broadly speaking, markets do work. When companies are competing for contracts they need to provide not only reasonable prices but also good service.’
I have to say again, this is a value, not an objective measurement. I understand where you’re coming from, and I understand that the model you have makes it entirely logical that the market should not only provide reasonable prices but also good service. But, in the real world, it doesn’t work that way.
To look at one of Dave Orbison’s examples – rail. It is not merely that the the prices are not reasonable, or that that the service is not good but that the failings here are commonplace. It is not the case that amongst the many different private companies involved, many are meeting the standards of price and service; there is a uniformity of poor service, that we are steamed for the price of a ticket is commonplace. You don’t hear the cries from, say, Cornwall, that it’s so unfair that they are the one region the glorious market has let down when it comes to rail. Your logic that it makes sense for a company to provide good service at cost for a greater end is beaten in the real world by my greater logic – if I can employ clever people to enable me to wring more profit out of you by cutting standards of service and by charging more and escape detriment then I will. Because the market determines that the immediate real profit I earn by this act is of greater value than your hypothetical end benefit.
So your response will be to prevent such acts by regulation. And the strengths of the market you applaud will look to undermine that regulation and carry on making that immediate profit. Look at tax regulation. The attempts at clamping down on tax avoidance through regulation are not met by the market holding its hands up and saying ‘fair cop – we’ll comply’ – it’s met by more and more cunning ways to undermine the regulation. That’s the free market at it’s strongest.
@ Dave Orbison Completely agree……. on the question of privatisation. On the issue that now seems to have been forgotten on LDV – floods blighting Yorkshire, Lancashire and Cumbria – no amount of market forces or privatisation can sort this out. IT HAS TO BE THE STATE.
Martin Kettle, in the Guardian, ought to be compulsory reading for all Lib Dems – especially the Orange Book Tendency. Yesterday : ‘David Cameron in wellies won’t mollify flood victims in the north | Martin Kettle The Guardian ‘With the arrival of serious flooding in larger cities such as Leeds”,………..
Having literally bailed out my 90 year old father-in-law in Appleby – and experienced York at a relative’s home on Saturday, I have to confess to a certain anger when I now discover that one of the first acts of the Treasury in the early days of the Coalition Government was to cut flood defence spending. Sir Daniel Alexander was Chief Secretary to the Treasury at the time.
The BBC reported in February 2011 “The government will spend £540m a year on flooding defences in England over the next four years – a cut of 8% from previous periods, the environment department has confirmed. The money will go towards 108 projects already under construction and 187 schemes under consideration. But projects in LEEDS and YORK have been put on hold”. Appleby, too ,had a scheme in 2009 which was shelved………
It’s yet another example of the Coalition’s impact on ordinary people which will not be forgotten in a hurry.
For privatisation to work, the efficiency savings of the private health care provider need to be greater than the profit margin that they need to make to justify bothering. And it needs to do this while maintaining at least the same level of quality and service. It also needs to maintain at least the same level of patient throughput without increasing the downstream burden on social services.
I’m not convinced this is all possible. The temptation for a private company to save costs and increase throughput by employing cheap(er) foreign staff and chucking patients out quicker will be too great.
Can anybody name any former public service that is now providing a cheaper, more reliable service to the public since it was privatised?
@Dave and @Bolano Hi! I think you’re quoting a bit selectively. I said “broadly speaking” markets work and also highlighted the need for a tough regulator for privatisation. This is something the energy market does not have in this country Dave.
Hi Nick. I understand your view but don’t agree, I just think privatisation has been done badly in the past but it can be done well. Please take a look at my reply to Ian here to see why.
Hi Ian. Yes I can. British Telecom. See this article from the Indy: http://www.independent.co.uk/news/business/why-privatisation-has-been-a-success-story-1281602.html
In fact, specifically in relation to privatising the NHS, while I accept there are many failures, there are also success stories. When people talk about privatisation they tend to ignore charities and not-for-profits which provide great service – e.g. Great Ormond Street Hospital. Not-for-profits provide a significant proportion of France’s healthcare. But even businesses provide good service to the NHS: http://www.bbc.co.uk/news/health-31435842 . In other nations such as Canada and France private companies provide great service at an affordable price.
@Dave Orbison
“The nation’s health service is too precious a service to be traded as some some of commodity. … if you think profit will deliver I can only say that I totally disagree.”
So you’re saying that the profit-seeking firms running the NHS Family Doctor service should be replaced by … what? Directly employed GPs?
Why? Because you think that the GP service as run for the last 68 years is rubbish and needs to be replaced by a “better” alternative?
@ian james
“Can anybody name any former public service that is now providing a cheaper, more reliable service to the public since it was privatised?”
Telecoms (i.e. what the nationalised British Telecom used to provide) would be the obvious example.
A Liberal in Leeds. I think the context of your comment implies an expectation that the markets will do better – I disagree. I ran an electrolysis plant that was very sensitive to electricity costs and dealt with Ifgem directly. My direct experience led me to the conclusion years ago that it was virtually a toothless tiger. I see nothing that changes my mind.
Simon as usual you seek to put words into my mouth. As far as your example is concerned all I can say is don’t be silly.
More private companies need to bid for public contracts if the NHS is to stay afloat.
This doesn’t really address the funding problem.; even if we assume that private companies can deliver services more cost effectively and cheaper than pure public organisations. This is because those contracts will be paid for out of general taxation.
I suggest that what is wanted is to redefine core services and what are ‘optional’ services. And allow the NHS to charge for ‘optional’ services. Some examples are what treatments should not qualify for free prescriptions, recent discussions on LDV have suggested e-Cigarettes and antiretroviral drugs used to manage HIV.
Also, I would agree the public-private partnership approach to service provision, such as the French healthcare example does seem to offer a way of spreading the financial burden beyond direct taxation.
Like so many vital national services the important factor is the results delivered. Our NHS must be able to deliver the health care we need. Quite honestly it matters not a jot who delivers the service as long as it is delivered at the lowest cost commensurate with its objectives. Most times this will be the state, but private companies, not-for-profits, social enterprises and cooperatives have a role to play. The problem that state providers have – not mention much in this thread – is that they are bureaucratic, sometimes to the point of preventing an effective service being delivered. There has been some success in delivering routine procedures like hip replacements through privately run but state funded specialists. The problem I identify in this thread is absolutism. I.E. it’s got to be the state or there have to be more private providers. As Liberals we have a proud record of innovation in providing health services for all and in creating the welfare state. What has always driven our approach is results. Too few people in this thread are considering that at all.
@Dave Orbison
“Simon as usual you seek to put words into my mouth. As far as your example is concerned all I can say is don’t be silly.”
If you say (i.e. not my words, but your’s) in relation to healthcare: “if you think profit will deliver I can only say that I totally disagree”, and if the NHS GP service is provided (as it has been for 68 years) by profit-seeking private sector partnerships, then you clearly don’t think the NHS GP service delivers.
Unless what you said were merely meaningless platitudes, and not to be taken seriously.
Public, private, it all comes down to who pays. They pay a great deal more for health cover in the USA and yet, for many Americans, health provision would insult a third world country. That’s what happens when you look on public health provision as a stigmatised last resort. That said, I have to admit that, if I needed a new knee, for example, I would not be bothered who provided it, as long as I didn’t have to wait an age.
There are some already arguing that some of the money we send abroad in aid should be re channeled to support more of our own people, and I have to say they do have a point. For me, the answer lies in taxation (see my previous post). So come on, colleagues, stop prevaricating. If it is money that’s needed, put your hands in your pockets!
if people truly believe that British Telecom delivers then I know one specific case where its service was so appalling that the customer was forced to switch to a cable provider for phone services as despite a year attempting to sort out an issue with the phoneline BT were unable or unwilling to fix the fault.
Hi Ian. Compare BT now to the mess it was before privatisation. I’m only 15 so dont remember it personally but understand it was a mess!
Hi Mick. I’m open to options for reform and think efficiency driven by some privatisation can only be good (with proper regulation). On the issue of who pays I worry that some can’t afford to pay for healthcare at point of delivery. What’s more, promoting privatisation is a hard enough political challenge, although I believe it is needed for sustainability. Ending “free at the point of use” would be a political nightmare!
A Liberal in Leeds, how does ‘ending something’ make it sustainable? To suggest the NHS is not sustainable simply accepts the nonsense that somehow we cannot afford it. We can, it’s called taxation. The idea that these supposedly unsustainable demands can somehow be fully met by private means whilst pursuing profit as its primary objective is nothing more than a leap of faith. Whatever happened to politicians being honest? If we want something we should expect to pay for it – taxation is the means by which we need to do this. But politicians of all parties pretend they can solve everything without raising taxes. The demands on the NHS are in part a reflection of developing successful treatments and longevity. Of course it should cost more and of course we should fund it through taxation – the alternative is nothing more than rationing of new and existing treatments. None of this stops efforts to improve efficiency etc but to suggest funding can be met through efficiency in the face of these advances and direct costs is simply dilusional.
“basic economics means that private companies have to be efficient in order to win contracts”
Scott Adams of Dilbert fame has made a lot of money and raised a lot of laughs (or wry smiles) from the fact that this is not a truism.
“Markets work”
Perhaps an economic system can be more efficient as a whole if it comprises a market of competing service providers, but this is not universally true. Private companies themselves are generally run in a top-down command and control style (e.g. they don’t usually have multiple HR and IT departments competing with each other internally or business units competing for the same customers externally because that would be considered inefficient) though they outsource some functions to external suppliers or partners via competitive tender. Perhaps the key is knowing which bits can be contracted out. But even then, how can we be sure that the profit element and the cost of managing a market in the NHS (e.g. evaluating competing bids and managing/regulating private providers) will not outweigh any potential savings.
“Privatisation is needed. Fast.”
A high-profile example of privatisation in the NHS is the provision of medical staff through agencies: the large cost of this has received a lot of bad publicity this year. General practice is often cited as a good example and a bad example of a sort of privatisation within the NHS.
Private businesses regularly fail, put the shutters up (sometimes overnight) and go out of business, with the liabilities of their owners limited to their stake in the company. In the case of a hospital (or a school, or a police force, etc.) the consequences of this do not bear thinking about, both in terms of the human and the financial costs.
I don’t believe that privatisation is the panacea that this article implies. It seems to be based on the assumption that privatisation will invariably increase efficiency (the only way I can see to reconcile “increasing taxation regularly to fund the NHS is fundamentally illiberal and unsustainable” and “healthcare should be free at the point of use so I’d rather the state paid the costs”) but this is not at all guaranteed. I would rather see an explanation of exactly how increased privatisation can be made to work rather than a simple expectation that with enough (expensive) regulation it just will.
(P.S. At the risk of sounding horribly condescending I was astonished to learn that this article and posts by Thomas elsewhere on LDV were written by a 15 year old. I may disagree with some of his points but I am hugely impressed by the way they are expressed and the party can only be enhanced by the involvement of young members like Thomas.)
@simon shaw – so you are suggesting that hospitals will be run on the same principle as GP surgeries – mainly as a partnershipsl – are you?
A Liberal in Leeds , a very thoughtful and necessary article , that does not warrant the sort of insulting immediate and predictable response from , to refer to one very obvious one , David Raw ! Whether people agree with Thomas or not , I agree with some , not all of the article , not only does the article not show the ignorance refered to by you , David , it shows real factual understanding , particularly with the welcome information on France , and Thomas s own view on their funding and fee charging . When Simon McGrath , rightly points out to David Raw that the PFI of the Labour government is not the same as privatisation , all David Raw does is say he knows that !Then why , David Raw , do you only allude to that in your patronising initial response to Thomas , ? It drives me mad the way , thankfully only rarely , admittedly and on occasion , new and young members are talked down to by older and usually left wing members of our party who cannot stand that the enthusiasm for solutions circa 1945 , carry little excitement with them amongst anyone born after that ! Young people today have a genuine open mind , in my experience , for example , they are keen on music several generations older than them , if classic and good . That’s proof , and more than can be said of my own generation , alas , as seen in Tim Farrons Christmas choice of music !!!!!!!!
And now for something completely different . A need to respond to the thread . To anyone who cares to read it , may I to my party colleagues and any visitor to this terrific site posit something RADICAL ?! I first of all declare that , as a result of immediate family , I have a good knowledge of the NHS . And the US aswell based on experience . And Italy to an extent , too . The same aforementioned family member sustained injuries from a car accident that have left her with some permanent disabilities . Throughout a decade and a half the Nhs has been a let down . Simple treatments and therapies not available , postcode lottery , lack of specialist knowledge , waiting for things beyond acceptable , short staff , etc ! And now for the solution . We need a realisation that only a Liberal answer , a Social , yes , economic , and personal Liberal answer ! That means what works , in the interest of the powerless , MUST be tried regardless of ideological clap trap ! This is NOT a left wing socialist party ! This is , equally , note the wor d as in equality , this is , equally NOT a right wing conservative party ! In our experience PFI has NOT worked , so , we can ditch it ! In our experience utilising the expertise and efficiency of some private companies has worked , so we continue that ! What does not work is a contempt for individual patients in pain , in a state of worry , waiting in a list based , monopolistic , ideologically purist, third or second world ,out of date so called system ! Thankfully we do NOT have such a system , not quite . We would ,if some well meaning ,at best and misguided , or zealous , at worst and mistaken , idealogues had their way ! We , arguably , and here s the truly RADICAL comment , have NEVER actually privatised ANY of our NHS . We have , it could be said , nationalised parts of the private sector and the charitable sector and other not for profit providers , too, ! How ? , because they have been brought in as a free at the point of use additional service , we have NOT flogged the NHS as a whole like BT or the utilities . It is in desparate need of money , innovation , flexibility , and , yes equality . It needs a radical commitment . It does NOT need a dinosaur mentality . And this party does not need anyone in it who insults members with new or different ideas , and insults sick people by putting ideology before anything .
Thank you for reading on a subject very important to me , and , no doubt many .
Lorenzo – I think to single out David Raw and attack him personally is out of order. I disregarded A Liberal in Leeds’s age in my response as LDV is not a school project but an open forum for debate. Furthermore, he seems well capable of defending his points of view and able to respond to them as he sees fit by focussing on the arguments rather than the person which is absolutely to his credit. To suggest that ‘the left’ are against young people becoming involved in politics is just nonsense. You only have to look to the huge response and support from under 25’s for Corbyn to put that to rest. I find many of the Orange Booker contributions to be arrogant, patronising etc etc but how do we advance a debate if we simply resort to name calling? I do my best (not always successfully) to try and resist this and stick to objective evidence where I can.
As for expelling people or wishing they leave the LibDems because they are deemed, in your mind to be guilty of the high crime of patronising someone, may I suggest a time out rereading of the Preamble a dozen or so times.
You state that you do not believe there has been any privatisation within the NHS and that your view on the is RADICAL. Well that’s one way of describing it I guess.
“Increasing taxation regularly to fund the NHS is fundamentally illiberal and unsustainable”
Why? The resources, whether services are delivered by the private sector or the public sector, have to come from somewhere. Taxation, if progressive, means that those who have the largest means contribute the most, which seems fair.
Increasing taxation regularly to fund the NHS is in fact exactly what is needed. Then we can have a discussion about how to deliver those resources efficiently to those in greatest medical need and in the most efficient manner.
The common feature of the best health services in the world is that they are well resourced, not how the healthcare they offer is delivered.
This seems to assume that more private companies in competition would provide better value for money. This is debatable, especially as a strong regulator doesn’t come cheap and companies want profits. The more you outsource, the more you need to spend on monitoring.
More taxation is only illiberal if the expense is avoidable or the service is unnecessary. I do not have an ideological commitment to direct state provision of services, but the assumption that direct provision is essentially inefficient is ideological rather than practical.
Picking up on the comparison with France, there are some interesting statistics on this page: http://www.nhsconfed.org/resources/key-statistics-on-the-nhs
This suggests that what the NHS needs most is not more efficiency but more money (which must obviously be spent as wisely as possible). Increased privatisation appears to be an ideology that does not address the underlying problem in this instance.
@ Ian James,
Healthcare managers have become the latest scapegoats. The ‘crazy schemes’ that you mention are the brain child of politicians not managers. More managers are needed to put them into place.
Also, just to muddy the waters in terms of numbers, an employee who was once known as a sister or a matron, is now known as a manager. Are doctors who are serving on commissioning groups instead of seeing patients, doctors or managers?
My question would be, what where was the sound evidence that provided the basis for the massive and costly reorganisation of the Health and social Care Act? If one wishes to move into anecdote, has the act, which was based on the belief that more competition and a greater role for the private sector, improved the services provided for those who need them? In my experience and those who I know to use them who can compare what service we received before and what service is available now, the answer is no, it has led to a more fragmented system with all the problems and added expenses that entails.
@ A Liberal in Leeds.
It is my understanding that in France the contributions of the user have been rising over the years, and their system is financially stretched too . The French are as concerned about the effect of an ageing population and how their healthcare system will cope as we are.
The problem when making judgements about which healthcare system in the world is the best, different organisations and different researchers use different criteria when making a judgement.
@Simon McGrath “The number of managers went down significantly under the coalition and the number of clinical staff went up .”
Your wording suggests that this was because of the coalition, but inevitable lags in such a large system mean that much of that change would be because of actions taken by the previous government, e.g.
“The number of managers and senior managers increased slightly in 2014, having declined in each of the previous four years.” (http://www.nhsconfed.org/resources/key-statistics-on-the-nhs)
Equally, performance (for better or for worse) over the next few years will be as much due to decisions made by the Coalition as those by a Tory government after May.
@ian james “What is increasing the cost of healthcare is the increased number of so called managers”
From http://www.nhsconfed.org/resources/key-statistics-on-the-nhs:
“In 2008/09 the management costs of the NHS had fallen from 5.0 per cent in 1997/98 to 3.0 per cent.”
I would suggest that what is increasing the cost of healthcare is the demands of an ageing population and increasingly expensive treatments and therapies. I believe that it will require more than top-down reorganisation and “marketification” to address these issues, and some difficult choices about medical priorities and sources of funding will have to be made.
A Liberal in Leeds 29th Dec ’15 – 8:19pm…………..@Dave and @Bolano Hi! I think you’re quoting a bit selectively. I said “broadly speaking” markets work and also highlighted the need for a tough regulator for privatisation. This is something the energy market does not have in this country Dave…
In that case, before anything else, we need a radical rethink about HOW we ‘privatise’….After all, It should not be forgotten that the French system is not ‘private’ in the way we see ‘private’…The vast majority of their ‘private’ sector is mutual, non-profit and strictly regulated by the government; a situation that no UK ‘private bidder’ would accept…………
Unlike many commenting here I know what would happen to the poor of this country if our healthcare was to be privatised. My mums family grew up in the 1930s when steel workers were paid a pittance. The only person that my grandparents could afford to pay health insurance for was my grandad, as he was the bread winner. This meant that my aunts and uncles had to suffer the ravages of measles, german measles, chicken pox mumps etc with the only recourse to medical aid being a charity sector unable to cope.
On to my experience of privatised health. I suffer from a brain disease whose treatment includes medication which makes me clench and grinds my teeth. It also reduces the calcium in them, making them incredibly fragile. I had a very good dentist who, when it became all the rage to turn their backs on the country, went private. I was assured that I shouldn’t worry, he could arrange dental insurance that would cost £110 per month, then around a third of my benefits income. Needless to say I was soon dismissed from that practice and spent four years without a dentist since NHS provision was so paltry.
Privatised healthcare suits only the well off and the healthcare companies, no-one else, and even then the former will only have the reassurance of an insurance policy whilst they are relatively healthy. I believe that the most common cause of bankruptcy in the US (the shining example of private healthcare) is through trying to afford an illness once insurance is withdrawn.
“The uncomfortable truth is that our beloved NHS is unsustainable”
It is as sustainable as we want it to be. No more and no less.
Every government has to allocate the resources which are available to it in the economy in such a way as it thinks fit. It’s just like a computer game that my children used to play where they had to allocate soldiers to defend the borders of a kingdom, workers to grow the food, workers to keep the levees in good order, health workers to fight against disease in the kingdom etc.
The game was cunningly designed so that sooner or later something really bad happened. The kingdom was invaded , or flooded, or there was a plague and/or everyone starved! But by allocating resources in a smart way it was possible to stave off the inevitable for quite a while.
Running our actual economy is, funnily enough, the real child’s play by comparison. We can grow more food than we know what to do with, the kingdom is unlikely to be invaded by real barbarians any time soon, and we have millions unemployed or underemployed who’d be happy to make a real contribution to the national wellbeing if the jobs were available. We have millions of fit and healthy retired people who perhaps wouldn’t want to work 40 hours week, 48 weeks a year any more but would like to work, say, 20 hours a week 24 weeks a year. They are an available resource which is being wasted.
There’s really no excuse for us not keeping our flood defences and the NHS in good order. We can do all that and still help countries in poorer parts of the world with their health problems and flood defences too.
This financial situation of the NHS is just what the Conservatives presumably hoped for with rthe 2012 bill., to create a feeling that The NHS is unviable and perhaps to privatise. This would produce an US style system, which although better with Obamacare is still not as efficient as ours was. The cost of running the NHS for decades after the 1948 bill was 3/4%. It rose a bit when the internal market was introduced but now suddenly it is 30/40%. See Professor Allyson Pollock. In 1948 was that the first duty of the Secretary of State was that everyone in the UK has access to the best affordable health care. This has been removed. The costs of commissioning, competition on and contracts is very large, Also the costs of invoicing and billing .and one has to be on a GP on a list to be sure of access. Allyson Pollock spells it out particularly well in her video.
You can employ a lot of nurses and buy a lot of drugs for 30% of the budget
Hi Dave, I don’t expect special treatment because of my age. Notwithstanding that I think saying “Oh dear, I’m afraid the NHS needs more privatisation like a hole in the head” sounds a bit patronising and unhelpful. Perhaps that’s just the tone I read it in though! Personally I agree that banning you from LDV in response is a step too far though.
Also I’m not sure what you mean by “ending” something. I believe in a free at the point of use NHS. I just think that the public sector can not deliver it as sustainably and as efficiently as the private sector could, with proper oversight from a strong regulator. On the point of affordability and taxation I think that because people of working age pay the most taxes and the population is ageing, it is inevitable (and illiberal) that without radical reform the NHS will leave workers paying higher and higher taxes. That does not represent fairness or freedom from poverty, nor is it conducive to the freedom to live a healthy life.
Hi Lorenzo. Thanks for your support of radical ideas. After all shouldn’t we Lib Dems be looking at the radical? For years the Tories and Labour have tried the same tired old ideas and they haven’t worked for Britain or the NHS.
I think your point about the status quo is an excellent one. For years now governments have been doing half-hearted privatisation with poor regulation and poor oversight. It has failed. If we believe privatisation can deliver better value for money we need a proper plan to implement it.
A Liberal in Leeds 29th Dec ’15 – 8:26pm…………….Hi Ian. Yes I can. British Telecom. See this article from the Indy: http://www.independent.co.uk/news/business/why-privatisation-has-been-a-success-story-1281602.html……
Anyone who believes BT’s improvements are due to ‘Privatisation’ is mistaken….Pre-privatisation the telecomms side of the GPO became Post Office Telecommunications, but still, when it suited government, was lumped with the loss making postal service….
There was massive investment and improvement in the 1970’s (being able to dial the US,etc directly etc.)…However, the improvements in telecomms is almost entirely due to improvements in technology, not privatisation….These improvements would have been achieved with or without privatisation….
A Liberal in Leeds | Tue 29th December 2015 – 10:35 am “Sustainable” is an ambiguous word. From the context you clearly mean it in the financial sense. There is also an enviromental meaning. A PFI hospital has been builf in a village near Tunbridge Wells, following the closure of the previous town centre hospital and with the support of the local Tory MP, Greg Clark. Part of the effect is increased noise from helicopters taking passengers to the hospital on a route on which road improvements have been refused.
Hi Richard
Yes, I meant in the financial sense. As I have been saying I don’t think specific examples of poor implementation of PFI mean that privatisation can never, ever work., whether the failures are environmental or financial. If we have strong oversight of privatisation, a coordinated plan and a tough healthcare regulator it can work. If we want a better NHS for our future I believe that privatisation has its part to play. We need radical reform if our NHS is to last with an ageing population.
Hi expats
The question: “Can anybody name any former public service that is now providing a cheaper, more reliable service to the public since it was privatised?”
The answer: Yes. BT.
I never claimed that BT’s privatisation was the best thing since sliced bread or that its improvements were solely due to privatisation. The example of BT does show that if done properly privatisation can deliver service improvements. I think it’s all very well saying ‘well this would have happened anyway’ (paraphrased) but we simply do not know that.
Dave Orbison , thank you for responding .Alas , if anyone is patronising now it is you , to me . I have not singled out David Raw , personally ,at all , but , as is the purpose of the site , responded to him , politically . I certainly have not called for his or anyone s expulsion from our party , to arrive at such a conclusion is groundless, and absurd . His views on other matters might on occasion get my support . Whether they do or do not , any democrat who signs up to the preamble , as you allude to it , should be at home in our party . I do not need the holier than thou encouragement to read it . Also , I have not refered to left wing party members in other parties , so bringing up Corbyn , is irrelevant . In fact , in Labour , much of the patronising attitude is , often as not , at present , coming from younger members , though not as young as would be called youth members , and towards , often, much older Blairites .I am only , as I make clear , again , referring to isolated examples . To say Thomas can stick up for himself is as stating the obvious as to say David Raw can too . We are hear to agree and disagree with each other , and in a constructive way . My contributions are positive as well as constructive . I shall always and often , as necessary defend the enthusiasm of new members with ideas . And predictable denigrating of orange book is not going to cut the mustard either . I am well aware good ideas and attitudes are to be found as are bad , in different wings , of our party . I do take a robust view on matters that literally deal with life and death , which health does .
@Joe Otten:
“Markets work. That is to say that a service subject to market forces will generally perform better than one that isn’t.”
Not so.
GENUINE markets work. False ones dfo not, sometimes because of deliberate intent, sometimes just due to manifest ignorance.
A Liberal in Leeds , good to hear from you . A strong debate , very worthwhile . I think comparisons with other industry or organisations do not work with consideration of private sector contribution , due to the all or nothing nature of them . I feel what the health sector in this or any country needs is the integration and inclusion of every available treatment and provision . It needs the Franklyn Roosevelt approach to the Depression . He saved capitalism ,yet he changed it s nature . A social Liberal , has , on this thread , rightly , and movingly from personal experience shown the pitfalls of full privatisation , as has taken place in dentistry . Such a change in general in our health service would be diasastrous. However , to accept it as it is , would be nearly as daft . Their is much too much top heavy meddling , the answer is a Liberal one . The patient should be in charge . Choice , accountability , democratic involvement , all must be at the fore , red tape lessened , innovation the norm , every new drug available . It costs money . It s better than the cost in lives unless we wake up .
Hospitals in London and across the country have racked up a massive PFI debt. The largest debt incurred by hospitals is down to the PFI contracts that were taken out in the Blair years. The PFI contracts have subsequently been shown to be flawed and debt ridden for the hospitals. Given that the country and the London Mayor can borrow at the lowest rates in decades surely it is time to try and buy out the PFI contracts. This would release a massive long term debt burden from hospitals. The debt could then be financed nationally or charged back to the hospitals at a lower rate. This would make NHS finances more transparent as judgement would not be on the increased debt but on services provided.
There has been much talk about invest to save and extra investment in infrastructure. Using the low interest to borrow more. Borrowing to buy back PFI will be an investment to save and surely there is not y not a better infrastructure than the NHS..
Could n t ignore other comments . Peter Martin very good on our having what we pay for and no excuse to not do so , but efficiency and equality mean we need every available source . Katerina Porter , you put thing s well , but if those are the motives of Cameron s Conservative s , I cannot countenance it of him , due to the genuine heartfelt concern from his experience of his little boy , who was profoundly disabled . Not to say such truly right wing views do not exist in the Tory part !!!!!!!!!!!
Lorenzo – you say you did not single out David Raw and that you did not suggest that anyone should be expelled from the party. But you do name him in accusing him and attack his style i.e. ‘being patronising’ and in your following post you refer to those that disagree with you as on this as having a dinosaur mentality and that this party does not need such members. I think it amounts to the same. I am not posting this to defend David Raw (who I do not know) nor do I am I interested in attacking Thomas or yourself simply because you have strongly held view with which I fundamentally disagree.
Thomas – welcome to the world of politics and the ‘cut and thrust’ of debate where passions can run high and opinions are often misrepresented as fact, all of which you are clearly astute enough to have figured out for yourself.
To clarify one point, you queried: you advocate privatisation as a means of saving what you claim to be an unsustainable NHS. In my view if that were done, then the NHS would seek to be the public service it is today i.e. your ‘solution’ would in effect bring about its demise rather than save it.
As so many have pointed out the NHS is fully sustainable if it is properly resourced. This is simply a matter of Government choice. Sadly, too many in the Government represent health company interests and are simply not interested in, value or appreciate ‘free at the point of need’ provision as they do not need it.
As for appointing a good regulator – I have not come across a good one yet and I worked for one until I blew the whistle on its shameful practices and weak-to-the-point of it breaching its statutory objectives of protection of the public. It would be an ineffective and complete waste of public funds.
Hi Lorenzo
I completely agree that there ” is much too much top heavy meddling , the answer is a Liberal one . The patient should be in charge .” I think in relation to having more patient choice, privatisation is a positive move in that direction. People seem to think that privatisation has to mean selling off bits of our NHS to big businesses. Far from it. No-one is suggesting we have an ineffective system like that of the United States. What I believe is that patients should be able to choose the sort of healthcare they need (as Liberals we should support that). We need a degree of privatisation to deliver that sustainably and efficiently.
To deliver patient choice we could set up 10,000 public hospitals, but that would be a terrible idea and utterly unsustainable! An alternative approach is an economically responsible, liberal one. That is why I have come to the conclusion that a voucher system is the Liberal solution to the problems facing the NHS. We need an integrated NHS with private and public aspects to give patients freedom of choice and hence great service.
I would just point out that most GPs are private businesses.
As are the companies who supply the drugs and medicines ….
….and the surgeon’s equipment in the theatres
….plus the beds …
In fact there is not much within the NHS that is not provided by the private sector.
I’ve had a long think about this and read everyone’s comments. Here’s my liberal idea.
This is an adaptation of the healthcare voucher system. If you want a GP check-up, need a scan or are waiting to have an operation you can choose where the funding for it goes. You can still have publicly-run healthcare in your local NHS hospital or GP surgery. The new option is that you can have the cost of the NHS equivalent paid to the private sector by the government. This way patients are given freedom of choice as to what sort of healthcare they want their tax money to provide.
This would mean that people will still get the great service they love in public hospitals if they want it. They will also be able to get cheaper private operations and check-ups though. The beauty of this system is that it won’t cost a penny more than the current system but will be more sustainable as public hospitals have clear caps on funding and are competing with private hospitals. This needs a healthcare regulator with teeth as I have said. This will help alleviate strain on our NHS and give patients freedom of choice. This is a liberal way to reform our NHS.
The “ballooning” is due the (correct) decision by Labour in their second term to increase health spending as a percentage of GDP towards the EU average paid for by increasing taxation (National Insurance). Between 1970 and 2000 – it stayed at between 4% and 5% of GDP (although 5% is 25% higher than 4%) see http://www.ukpublicspending.co.uk/spending_chart_1970_2016UKp_15c1li111mcn_10t. By 2009 it was almost 60% higher than 2000 at 7.80% of GDP and has stayed relatively constant since. Lib Dems should be proud of their record in campaigning for this – at the 1997 General Election and during the 97-01 Parliament when we argued for increased public spending paid for by increased taxation and against Labour following the Tory spending and during the coalition when health spending was maintained in real terms.
The argument over whether suppliers (as supposed to the buyers) should be public or private is an important and interesting one but surely secondary to how much you actually spend. Probably the most respected part of the NHS – GPs is “private” as GP practices are private businesses. Drugs and equipment come – a large part of the NHS’ budget come from private businesses. Hospitals though I personally think are better run directly by the NHS.
Looking ahead to the 2020 General Election, I think we should be saying two things – firstly that we should be maintaining health spending at the same level of GDP (at least) which would be a real terms increase. We should also look at social care which I think all agree is under even greater pressure than the NHS and say that we would increase funding by increasing basic rate tax by 1p.
@ A Liberal in Leeds – The system you are proposing is already essentially the case. Under “choose and book” you can choose any hospital including private l if they do the operation at the NHS price (and standards) – see http://www.nhs.uk/choiceintheNHS/Yourchoices/hospitalchoice/Pages/Choosingahospital.aspx . My understanding is that you can register at any GP practice and that you have the right essentially to any NICE sanctioned treatment for a particular condition.
Thomas Shakespeare 30th Dec ’15 – 1:59pm………..Hi expats…..I never claimed that BT’s privatisation was the best thing since sliced bread or that its improvements were solely due to privatisation. The example of BT does show that if done properly privatisation can deliver service improvements. I think it’s all very well saying ‘well this would have happened anyway’ (paraphrased) but we simply do not know that…….
I agree! However, we can look at something we do know…
East Coast Rail… Privatised with GNER (failed) taken on by National Express (failed)
Taken public with DOR who received the lowest subsidy of any operator and returned more money
back to the state than any other train operator. In 2013/14 it paid £217m to the Treasury and
returned over £1bn to the the taxpayer…,
Using the ‘dogma’ that, despite evidence to the contrary, ‘private’ is always better than ‘public’…re-
privatised’…
Hi expats
Sometimes privatisation works, sometimes it doesn’t. Sometimes the public sector provides better service, sometimes, as with the mid-Staffords scandal, it doesn’t. Pointing to specific examples doesn’t really constitute an argument because there are so many privatised companies and public sector departments.
Have you taken look at my proposals above for a voucher system? I do not believe that “private is always better than public” but that private companies have a large part to play in the future of our NHS. Ultimately patient choice is key.
@ A Liberal in Leeds. On re-reading your comment you may be saying something slightly different from what I initially thought – namely if the NHS cost of an operation/treatment is £1500 and if you go to a private hospital it costs £2000 then you only have to pay £500. In general private provision buys a number of things. Shorter waiting times which for non-emergency operations may reduce pain and suffering but does not (really) affect health outcomes and it may buy nicer meals and posher surroundings – ditto. It (most probably) does not buy a better surgeon given few operate solely in the private sector. For treatments and medicines – all cost-effective and effective treatments should be available under the NHS and there is an argument that other treatments and medicines should not be subsidised if they are not available to all. On choice – there is choice if it is charged at the NHS tariff.
It also risks a number of things. Firstly it is a massive subsidy to the richer that can afford private insurance or one-off payments. In the longer term it risks a USA type system where there is a very basic safety net and little will to improve it because a large number are on private insurance. Mostly people meet health expenditure through insurance – either Government provided like the NHS or private because it is unpredictable and potentially very expensive. Those with private insurance are massively benefitting from the NHS because the NHS covers emergency (A&E) care, and many treatments on NHS prescription but can top this up to a variety of levels if they want through private provision. There is always a debate on rationing health care and private insurance also rations and has many disadvantages with private insurers not wanting (or charging very large premiums) for older people and those with pre-existing conditions.
There is an interesting table on health outcomes and % of the GDP spent on health care at https://en.wikipedia.org/wiki/Health_system and by and large the UK is comparable to other developed countries for health outcomes, percentage of GDP spent on health and percentage contributed by the Government/taxpayer. Obviously health spending is not the only determinate – with suggestions that countries such as France and Italy benefit from the “Mediterranean diet”. The outlier of course is USA with double the expenditure and worse outcomes – brilliant if you can afford it, terrible if you can’t or not a high level of private insurance with many exclusions and high excesses and with the poor including the working poor enslaved by the tyranny of private health insurance. With Obamacare and increased popularity for more of an NHS style system (they call “single payer”) the USA are moving towards us. The figures would suggest that an NHS/public provision of health care is beneficial at a population level.
@expats – for the record I understand from http://www.bbc.co.uk/news/business-30222458 that the current franchisee is paying the government £412.5 million a year for the franchise (£3.3 billion over 8 years) so considerably more than direct operated railways returned to the treasury but DOR returned more than National Express were paying http://www.theguardian.com/business/2009/nov/03/national-express-public-ownership . I think it fair to say that East Coast is about the best line to run – excellent infrastructure over long distances and so it is not surprising that it has the least subsidy/most returned.
Personally I don’t understand why companies owned by other EU national governments can run British railway lines but not UK Government run companies. I think it also fair to say that BR was a fairly rubbish service quite often with some very old rolling stock – as with BT a large amount of the improvement (if there has been an improvement!) esp. new rolling stock may well have happened anyway.
@ Thomas Shakespeare,
May I point out a problem with the idea of patient choice in healthcare. Competition between providers requires redundant capacity and therefore the provider needs to charge more to cover the cost of redundant capacity.
The Beveridge system of unified provision meant that there was no need for redundant capacity just to create a competitive market. It also meant that money was not spent on marketing and that economies of scale could be made.
The idea that money follows the paper was taken directly form the white paper NHS and Health Care Act that Andrew Lansley had spent years producing . The flaw being that shift to individual billing requires a greater amount of bureaucracy. Pooling of costs and risks across the nation are more efficient than purchaser provider arrangements with their different administrations needed to monitor billing arrangements.
There are also problems of supplier -induced demand. In fact I can think of no system such as the market approach to healthcare which affords greater opportunity to make a financial killing at the patient and tax-payers expense.
We want a service that is effective, efficient and economical, and I would like to see evidence rather than assertions that the current market- based approach with competition from an assortment of providers offers that. If that makes me a socialist rather than a Liberal, jolly good.
Sorry, I meant to type, ‘money follows the patient’.
Hi Michael,
“In the longer term it risks a USA type system where there is a very basic safety net and little will to improve it because a large number are on private insurance. ”
I think that there will be a significant number of people who want fully public healthcare and not subsidised private care. Therefore I don’t feel that we’ll see an influx of people switching to health insurance. One of the key advantages of providing the option to subsidise private hospitals is that the pressure on NHS hospitals currently under strain is alleviated.
@Jayne Mansfield To put the other side – it is debatable whether or not a bureaucrat who might want to err on the side of caution would or would not have more redundant capacity than a “private market” provider who would have redundant capacity increase his costs and decrease his profit. In general the theory is that if someone is making a profit in one market there should be new entrants, increased competition to get some of that profit until “excess” profit is taken away. There is no doubt that a lot goes wrong with markets – monopolies, barriers to entry, anti-competitive practices, incomplete information. But as liberals, we should also recognise the power of “bottom up” pressures against authoritarian top-down central control from faceless bureaucrats.
However as it happens, I think that there is a large need for central planning of hospitals and that hospitals will remain directly run by the NHS. In general A&E in particular needs to be relatively local and is not an area that private providers are greatly interested in and for planned operations there is a large preference by patients to be treated as locally as possible.
There is a great Yes, Minister episode where Jim Hacker learns of a new hospital that is fully staffed but is not open to patients because that is so much easier for the civil service and the NHS not to have the cost of patients! While that is obviously fictional and extreme – the authors often took as a starting point what was happening in public services and Government in the 70s and 80s.
From memory most of the “money following the patient” happened under Blair or before – GPs have be paid for the number of people registered with them for a long time and hospitals been paid per patient operation (mostly) from the local NHS under Blair if not before, I believe. There is as with the Yes, Minister example a danger that bureaucrats will build nice hospitals and not care much about the actual patients. Equally a major concern with the coalition’s health bill was that private operators could cherry pick the easier routine operations.
For followers of this thread there is a quite interesting but no doubt simplified discussion of how 10 countries’ health systems are paid for at http://people.howstuffworks.com/10-health-care-systems.htm
An NHS patient treated by a private hospital is not followed up by the surgical team who carried out the operation and needs to be referred back to the speciality if problems occur by the G.P thus creating a disconnect in the care pathway and risking emergency readmission of patients placing further strain on the health service.
I have yet to see how greater fragmentation and pretend choice benefits care of patients and reduces costs instead it seems to me it increases the costs by creating extra paperwork and increases risk to the patient by fracturing continuity of care.
@A Liberal in Leeds
An interesting debate !!!!
The argument for voucher systems fir any public service is, as you say, the cost would be occurred anyway so why not give someone the cost of an NHS operation/treatment and give them complete choice as to where to go and that it promotes choice. It does not really reduce the strain on NHS hospitals as it obviously takes money out of the NHS system and if the price of the voucher is what the cost would be to the NHS there is no benefit. Indeed an argument against any use of private hospitals even at the same cost is that hospitals need volume – you are essentially paying for the surgeons, doctors, nurses and beds (and PFI costs!) whether you are treating a patient or not. And as I said this was a major concern over the health bill that private providers might “cherry pick” easy routine operations.
The downside is also that it benefits the richer and those that can afford extra costs and if the rich can afford say super hip replacement or life saving treatment why should not those be available to the poor – overall voucher systems tend to take from the poor and give to the rich. The poor end up with a basic service – the rich have subsidised private care. The USA is certainly an extreme example of this essentially. But the fear/possibility/actuality that any free service will become more basic. Perhaps not surprising people in the USA are very divided on Obamacare and also on moving to a single payer/NHS system. With republican voters (essentially better off) against and Democrat voters in favour and Bernie Sanders is gaining considerable traction on the Democrat side for a single payer system.
And as has been noted the NHS is extremely popular and moving too far or indeed any way from it towards (more) private insurance is unlikely to be popular. Private insurance also does not solve the problem of rationing – indeed it may well be worse and it is private insurers that choose what is covered, may not pay up for certain treatments etc. In general I favour public universal free insurance for the welfare state – and indeed that was Beveridge’s idea and what national insurance was started for – unemployment and welfare benefits and the NHS – you paid in when you could afford it and you got out according to need. In general NHS type systems seem to have better health outcomes for the population as a whole rather than private insurance schemes.
Continued –
I can’t claim to be an expert on health care schemes around the world and it is true that we could change and not go as far as the USA but have had a look around the internet (well the link above). Germany I think you can choose which private non-profit insurer to go with but it is paid for by tax (as % of income) or by the Government for the unwaged. And in France, 70% of costs are reimbursed but you have to pay the rest directly or through insurance but with expensive treatments paid for 100%. So there are options that don’t go as far as the USA. I am personally doubtful whether there is much improvement if any in choice, health outcomes (esp. at population level) or in coverage of possible treatments. Essentially Germany has worse slightly worse or similar health outcomes compared to us – France better. As I said the position is slightly complicated with France having a better diet than us – and it also spends about a third more than us with a similar percentage being picked up by the Government.
This has been one of the most illuminating threads I have followed since I first logged on to this website a few months ago. As someone whose contributions have occasionally been deemed to be too personal by the editor for publication it has surprised me what some more seasoned contributors have been allowed to get away with! I think it’s time for us to put a few of those toys back into their prams. And there was me thinking that liberals were such nice people!
@ Michael,
Everything is debatable and open to criticism , not least the WHO rankings of 2000, but I would be surprised if any NHS bureaucrat could manufacture redundant capacity given the pressure that the system is under. If there is any slack in the system I imagine any bureaucrat or clinician would be delighted to know where it is.
More worrying for me is what a bureaucrat or clinician might wish to do under the current system, ie maximise profits. In the case of hospitals, to prevent them becoming ‘failing hospitals’ . Whilst a refusal to bale out failing hospitals might be seen to incentivised staff to give a better service, it could as in the American model, also potentially incentivise over- treatment and overpriced services to keep them in business.
By the way, I am no apologist for Tony Blair’s NHS reforms. I have in the past, familiarised myself the work of Professor Allyson Pollock whose name was mentioned by a previous poster.
Of course the private companies will cherry pick the easy routine surgical work etc. I doubt it would matter whether patients wanted an A & E close to them or not, private companies would not touch this work with a barge pole.
A Liberal in Leeds mentions tough regulation, well, that is another increasing expense in a fragmented and privatised system.
You mention a bottom up system, how bottom up? I would not describe giving GPs who are private contractors, the power to commission services for ‘their’ patients, a bottom up approach. Unless the patient has a medical degree, there here is an asymmetry of power between the patient and the doctor and there is potential for a conflict of interest given that the doctor is both the provider of information on which patients make choices and also the provider of that care. I would argue that tis conflict is greater in a market system.
@ A Liberal in Leeds,
My husband and I are retired tax-payers. We would be prepared to pay more for an NHS funded by taxation, whether that is an hypothecated tax as mentioned by John Marriott, or through a more progressive general taxation system. Labour brought the NHS into existence when the country could not afford it, so if the issue is affordability, it is not a new concern.
Hi Jayne,
Businesses spend money very efficiently. Unlike with the NHS, especially under Labour up to the 2008 crash, they can’t afford to keep spending and spending, undermining the sustainability of the healthcare system. I would have to look at figures to back this up, but I hold the view that the money spent on marketing, billing and on redundant capacity is outweighed by the need to spend efficiently. I also think that the point Michael explores about the importance of money following the patient in providing value for money is a good one.
Addressing your point on quality of care, a tough healthcare regulator which publishes healthcare rankings and has the power to ban under-performing private companies from being subsidised would address the potential issues with private sector quality of care. If patients can shop around for their healthcare and see the quality they are getting on an online database provided by the regulator, this incentivises companies to provide good quality healthcare.
Meanwhile market competition not only brings down the price of healthcare in the private sector, but also makes public sector healthcare more efficient as NHS trusts are competing with private companies.
“If that makes me a socialist rather than a Liberal, jolly good.” Fair enough. We are a social democratic party as well after all. I agree that you can’t just say ‘We are Lib Dems. This is liberal and therefore we should do it.’
Hi Michael
We can have public & private sector treatment together. I don’t deny that it would be very politically difficult though.
“does not really reduce the strain on NHS hospitals as it obviously takes money out of the NHS system and if the price of the voucher is what the cost would be to the NHS there is no benefit”
It benefits individual underperforming hospitals though. They have lower patient numbers so can improve with less strain on their departments.
Many Liberal Democrats hate the private sector because they perceive it as there to make vast profits. People who work for nationalised undertakings do not want any change to their way of working and their incomes and those who work for private companies are envious of the perks and privileges apparently available to those who work for the state.
The private sector works where there are opportunities for competition, for instance retailing, manufacturing etc, and supplying the state and other bodies with competitive tenders for services they provide, if those responsible for the tendering process actually understand what they are doing, which is often not the case apparently. It should surely not be beyond the wit of man to devise a method whereby the private sector can be involved in the provision of free at the point of use treatment, but apparently it is. Probably because the education system, culture and social mores of this nation is so hopeless that nothing works anymore, whether it is in the private or public sector. I now understand why Stalin was so ruthless with those who were perceived as failures.
The case of Hinchingbrooke Hospital seems to be controversial as there appear to be genuine concerns that the process of inspection was not carried out with an open mind but purely to denigrate the private sector.
A very well informed left wing socialist friend told me was having an operation in a private hospital as he did not trust the NHS to do it. Make what you wish of that.
I wish you all a Happy New Year
@A Liberal in Leeds “I hold the view that the money spent on marketing, billing and on redundant capacity is outweighed by the need to spend efficiently.”
Your article was about the need for improved efficiency (that you believed could only be provided by more privatisation within the NHS) and you have moved on to call for more patient choice between competing medical service providers. You will need to do more to convince me that efficiency and choice go together. If, as a patient, I can choose between three hospital beds, then there are two empty, redundant beds in addition to the one that I need.
Would it be more efficient for ambulances from different companies to race each other to a multiple car crash (while perhaps ignoring a less profitable single fallen pensioner) or for A&E departments to engage in a reverse auction competing for the casualties being driven away from that incident?
@nvelope2003
Happy new year.
“Many Liberal Democrats hate the private sector because they perceive it as there to make vast profits.”
Many Lib Dems work in the private sector. Many Lib Dems know that private companies already have a role in providing goods and services to the public sector and should continue to do so. Many Lib Dems believe that privatisation, competition and marketisation are not inherently evil, but neither are they panaceas.
It is this balancing act that makes being in the political centre ground so difficult. We do not have the comfort of a default position to which we can retreat (private=bad or private=good). For what its worth, I believe that the recommendations being made by Thomas here are too far to the political right (economically liberal) for my liking. However, I do not believe either that we should nationalise the industry that provides paperclips to the NHS. Somewhere between the two there is hopefully a combination of private and public provision that works.
I also believe that there is a need for more money in the health system, and debates over privatisation and choice are a sideshow which do not address this fundamental issue. If the funding is not to come from general taxation, then maybe it needs to come from the patients. Perhaps income-dependent repayment of a loan to cover treatment costs similar to the scheme that Lib Dems support for university tuition fees (imagine a tongue-in-cheek smiley here!). Or an acceptance that those who can afford to choose to pay more for their treatment should receive something over and above a “basic” level of service (shorter wait, nicer conditions, better doctors, …) whether from a private or a public provider. There are very difficult political decisions to make here.
(P.S. It may be that your socialist friend does not trust the NHS he has but would trust the sort of NHS he wants.)
Dave Orbison , we are best , I believe , ie on this thread , to agree to disagree , I have not advocated expulsion , this has started because I defend young and or new members , who I do not want patronised by older or other s who have been members for years , if you have read something into what I am saying , as advocating kicking people out , you misinterpret me .
A Liberal in Leeds , can I say , very many congratulations on your whole approach to this issue . Whether any member agrees on the detail , you are showing something I have tried to for years , an openness to new or different ideas . I do feel a voucher system begins with one disadvantage , it is misunderstood , because , wrongly , it is associated with centre right tendency . In the USA , where I have some family , through marriage , and is the country I know the most other than Britain , innovative and compassionate vices on the centre and centre left of the spectrum have been advocating such ideas . There is a political party in New York called the Liberal Party of NY , they back liberal Democrats , or Republicans , but do not field candidates .They advocate , or are open to vouchers in education , to free poor kids from often lousy schools , especially in the early years . Simarlarly , the Democratic Freedom Caucus , a libertarian Democrat grouping , definitely predominantly centre left , feel likewise . Here , and on the same wing of the spectrum , as in the USA , such voices are few . In health , David Laws article in the Orange Book became infamous , I know of many who condemned it , having admitted they had never read it !!!!!!!!!!!!!He was motivated by compassion for a constituent waiting years for service in the NHS . Motive is all . Continue this debate , you are a credit to your name !!!!
Correction ,” innovative and compassionate voices” should have been written in early bit of previous comment , NOT “” vices “!!!!!
Peter Watson: I agree with a lot of what you say but this does not seem to be the view of the most vociferous people here.
It is said that since privatisation rural bus services have been drastically reduced but that is not the whole story. Some services which carried hardly any passengers because of demographic changes – the farm workers were replaced by affluent commuters, for example – have been withdrawn or reduced but others have been increased. My home is in a rural area but the local bus company now operate 12 journeys each way daily to the main town instead of the 4 journeys each day previously provided and there are also journeys to other towns as well. The small NHS hospital is now a sort of place for recovering patients and does not have much in the way of other facilities. Shops which closed because they were uneconomic have been replaced by others. Change is inevitable in a society which wishes to develop in accordance with modern needs.
nvelope2003 “I agree with a lot of what you say but this does not seem to be the view of the most vociferous people here.”
A discussion about privatisation and marketisation within the NHS could easily descend into acrimonious argument with people retreating to very entrenched positions, even (or especially?) on a Lib Dem website so, to be fair, I’ve quite enjoyed the way that this thread has, on the whole, been civil and open-minded. Perhaps it is the season of goodwill to all.
The NHS is one of many issues where I feel that the party is still vague and directionless, and as 2020 rushes towards us I think that Lib Dems do need to be defining themselves in specific policy areas. It is not enough to claim to be in some sort of ill-defined centre-ground between the other parties without spelling out more precisely what that means and exactly which policies from the left and the right we want to cherry-pick in a coherent manner.
Since the disastrous election in May it feels like the party is retreating to the “all things to all people” position that led to such heartbreak in 2010 when it was forced to make decisions that alienated many supporters. Discussions like this give me an opportunity to see what is the direction of travel. My personal hope was that Tim Farron’s leadership would mark a more decisive break from the policies endorsed in coalition and so far I am disappointed by the lack of clarity.
Excellent article, the NHS urgently needs to be privatised. The King’s Fund report concluded that profit, non profit and NHS providers can provide high quality care and equally all sectors can fail to do so. A provider making a profit from its trading with the NHS does not mean the quality of care is comprised. The NHS is already made up of hundreds and thousands of organisations and individuals. The private sector already work in pharmacy, dentistry and optical care. The financial strain on the NHS is only going to get worse. Politically the support for your idea in lib dems may be limited because you would be aligned with the conservatives and their right wing, which would be excellent for the country but may hinder your electoral chances.
may be limited because
One thing I don’t understand here – private health care provision does not bring DOWN costs. It just shifts the burden. In general, US health system, for example, costs twice per person as the Canadian system. Amercians pay much more for – on average – less. So if it is costs you are concerned about, privatization is clearly not the answer. If, on the other hand, what you are really saying is that you want to shift the burden from the taxpayer to the “consumer”, from society to the individual, then you should say so.
Where is your evidence that “the current system cannot provide sustainable healthcare in the modern world. “?
An illinformed piece. The NHS has always worked with a huge does of goodwill. As a publicly owned organisation people do this for the good of their community. Private sector companies don’t do this. Its happened in my area. As soon as a private company took over a service the CCG contacted them and asked why they were not delivering one part of the service like the NHS hospital did when it had the contract. The response was “its not in our contract”. The CCG hadn’t codified all of the service, so the private company, like all private companies, only fulfilled the contract that it was paid to do. The CCG realising that the entire service *must* be delivered then had to pay the private company extra, resulting in the service costing *more* than with the NHS hospital. The private company does not care whether they deliver the whole service, or part of the service, they only care about the profit. An NHS organisation, firmly embedded in the community, knows that it is the outcome that is important – the healthcare of the patient.
The article is naive, and it is clearly written by someone who cannot be bothered to attend public board meetings of commissioners and providers and see how healthcare is delivered. Typical Lib Dem, to be frank.
So many problems with this.
This seems to identify that (good) healthcare is expensive to provide and suggests increased taxation is not desirable because it will be unfair to ‘workers’. Yet it continues with a non sequitur about competition as if that was guaranteed to contain costs. The Tories – aided, abetted and enabled by the LibDems – continued and accelerated privatisation without a jot of evidence that it would reduce, never mind control or decrease costs on an ongoing basis. But the issues of funding and provision should not be conflated.
At the end, you talk about the French having to pay additional costs over and above the ‘tax’ they already pay. This is a tax on the sick that surely puts an unnecessary and unfair burden on them? Is that, in your mind, better than putting an unnecessary and unfair burden on workers?
However, the question this raises – and one the Government has to answer (although I’m not holding my breath) – is how have an additional system of raising more money from taxpayers (or the sick), probably by private companies who will need to take their cut, of course, is a better or more efficient solution that increasing general taxation. And, of course, this additional taxation can be tiered to avoid crippling the low paid. It is clear many now struggle to feed their children: what will society be like if co-pays are demanded of them for health?
The issue is a simple one: should healthcare be provided, free at the point of use, with the cost spread amongst all taxpayers, or should we expect the sick to pay more?
FYI quick update on this. Really interesting discussion and thanks for everyone’s input. Changed my mind a bit. I stand by the idea that privatisation could potentially go alright if it is done well. However, is it worth it? Does the NHS need such a radical overhaul? No, absolutely not. Proper funding and efficiency, as well as retaining our excellent healthcare professionals , is the way forward.