Efford Bill has finally been published – it’s not going to stop NHS cuts & sell offs or protect the NHS from TTIP

Clive Efford’s Private Member’s Bill will be debated in the House of Commons on 21st November.

It was finally published last week.

Many people who want to save the NHS from cuts and sell offs have been looking forward to its publication, hoping that the Bill will set out a new way forward for the NHS that undoes the damage that the ConDem’s Health and Social Care Act (HSCA) 2012 has inflicted on it.

But now I’ve read it, to me the Efford Bill looks like a case of running with Save Our NHS campaigners and hunting with the NHS privatisation hounds.

It doesn’t satisfy these key Green Party policies for the NHS, which are to:

  • restore the “duty to provide” healthcare by the Secretary of State for Health – the ConDem Health and Social Care Act 2012 replaced this with a feeble duty to “promote” healthcare
  • make sure the NHS remains a unified public service and end the “internal market” and private sector involvement
  • provide adequate funding

The Efford Bill doesn’t:

  • Bring back the Sec of State’s duty to provide comprehensive universal health service.
  • Repeal the HSCA 2012 – it only changes some bits, eg about Monitor (the competition/privatisation enforcer), where the effect would be to replace Monitor with the Office of Fair Trading.
  • End NHS marketisation/privatisation.
  • Remove private health care companies that are already in the NHS.
  • Take the NHS out of EU competition law – despite repealing Section 75 of the HSCA 2012 – because the Efford Bill categorises the NHS as a Service of General Economic Interest (SGEI). SGEIs are subject to EU Competition Law, which means corporations have rights to their budgets, by bidding for contracts to run their services. The Efford Bill had the option of categorising the NHS as a  “non-economic” non-marketised public service with no commercial involvement. This would put the NHS outside the scope of EU competition law and remove the right of corporations to bid for NHS contracts. But the Efford Bill chose not to do this.
  • Categorise the NHS as a non-commercial, non-marketised public service.

The Efford Bill does:

  • Repeal Section 75 of the HSCA 2012 (the bit that requires NHS commissioners to put new contracts out to competitive tender under EU competition law, and so has opened the door wide to NHS sell offs).
  • But at the same time it keeps the NHS subject to EU competition law, by categorising it as a Service of General Economic Interest, instead of a “non-economic” non-marketised public service with no commercial involvement.
  • Subject the NHS to TTIP, if/when the EU & USA sign that Treaty, as a result of categorising the NHS as an SGEI, which subjects it to EU competition law.
  • Include some amazing Alice in Wonderland legal skullduggery, about when an NHS contract is not an NHS contract. In combination with the repeal of Section 75 of the HSCA 2012, this would effectively exempt a range of contracts – particularly the 2016 privatisation of Commissioning Support Units (CSUs) – from EU competition law. This would allow a privatised monopoly CSU to be set up across the whole of the English NHS.
  • Keep the Sec of State’s duty to promote a comprehensive health service.
  • Give the Sec of State the power to overrule decisions by commissioners or providers on the grounds that they’re anti-competitive – so this undermines Andy Burnham’s commitment that Labour would make the NHS the preferred provider, since it allows private healthcare companies to challenge commissioners’ awards of contracts to NHS preferred providers, by going to the Sec of State.
  • repeal HSCA 2012 sections 62(2),62(3), 62(10), 67(3)(a), 72-80. These are in HSCA 2012 Part 3, which is what Burnham told the Nuffield Trust meeting at the September 2014 Labour Party Conf that a Labour government would repeal. These sections of the HSCA 2012 are all about Monitor – the quango that enforces competition rules in the NHS – like Ofgem does in the privatised gas and electricity industry (see Appendix)
  • Remove the 49% cap on the amount of private income Foundation Trusts are allowed to earn.

Transatlantic Trade and Investment Partnership (TTIP)

TTIP, a trade treaty currently being secretly negotiated between the European Union and the USA, is a serious threat to the survival of the NHS as a public service. It would give corporations the right to challenge governments in secret courts if governments do anything that threatens their profits. So awarding a contract to an NHS organisation rather than private health care company could be grounds for a corporate attack on the government. In this way, TTIP threatens not only public services, but democracy itself.

On TTIP, the Efford Bill (section 14(1) assumes that it’s possible for the NHS to be exempted from TTIP procurement and competition obligations. In other words, corporations wouldn’t have the same rights in relation to the NHS, as they would to other public services.

But according to Dr Lucy Reynolds, a research fellow in health policy at the London School of Health and Tropical Medicine, this assumption is unfounded, because TTIP exemptions only apply to fully publicly-owned public sector organisations, and the NHS is already part-privatised.

This is borne out by trade and competition law expert John Hilary, writing in the British Medical Journal:

“The European Commission has confirmed that health services are on the table, and a leaked copy of the EU’s liberalisation offer has revealed its full ambition. Not only hospital services but medical (including midwifery and physiotherapy) and dental services are to be opened up to competition under TTIP. Individual EU member states may enter reservations to protect specific sectors, but the only one entered by the UK government is for ambulance services.

The market liberalisation introduced by the 2012 Health and Social Care Act ensures it will be effectively impossible to take the NHS back into public hands if the EU-US deal goes through. Both the UK government and the European Commission have confirmed that TTIP’s provisions to protect investors would grant US corporations the power to sue any future administration over such a move.” http://www.bmj.com/content/349/bmj.g6552

So to protect the NHS from TTIP would mean breaking the EU competition law connection set up in Section 75 of the 2012 HSCA. This gives corporations the right to bid for NHS contracts. This is the “market liberalisation” John Hilary refers to.

But the Efford Bill pulls a massive con trick.

Part 3 Section 10 the Efford Bill repeals Section 75 of the Health and Social Care Act (the section that ties in the NHS to EU competition law and requires NHS commissioners to put contracts for NHS services out to competitive tender),

But by a magician’s sleight of hand, Part 1 Section 2 (b) of the Efford Bill keeps the NHS subject to the EU Competition law and maintains corporate rights to the NHS budget, by categorising the NHS as an SGEI – a Service of General Economic Interest. http://ec.europa.eu/competition/state_aid/legislation/sgei.html.

The left hand giveth and the right hand taketh away.

If The Efford Bill really wanted to take the NHS out of EU competition law and restore it to public ownership in order to exempt it from TTIP, it could have categorised the NHS as a “non-economic” non-marketised public service with no commercial involvement:

“Member States are free to organise the provision of compulsory social services or of other services such as postal services either as services of general economic interest or as non-economic services of general interest or as a mixture thereof. It is appropriate to clarify that non-economic services of general interest should not fall within the scope of this Directive.”

(This is the 26 February 2014 Directive on public procurement
http://eur-lex.europa.eu/legal-content/EN/TXT/?uri=uriserv:OJ.L_.2014.094.01.0065.01.ENG)

Categorising the NHS as a  “non-economic” non-marketised public service with no commercial involvement”, combined with the repeal of Section 75 of the 2012 HSCA, would do the job of breaking the hold of EU competition law over the NHS, and end the “market liberalisation” that stands in the way of protecting the NHS from TTIP.

How important/useful is the Efford Bill for campaigns to stop NHS privatisation?

There is nothing in the Efford Bill, including its repeal of Section 75, (which is anyway negated by Part 1 Section 2 (b) – see above), that is going to stop the rush to sell off Calderdale’s NHS community health care services in the next two years (2015-17), as laid out in Calderdale Clinical Commissioning Group’s Care Closer to Home Commissioning Intentions document.

Unless campaigners succeed in stopping this sell off – and we are trying – the new “Right Care Right Time Right Place” community care services are due to be put out to tender – without any public consultation – between 2015-17. The contracts will be worth £ hundreds of millions.

So before the General Election, the rush is on to get this phase of the community services “transformation” ready to go.

Then afterwards we can expect an NHS privatisation gold rush, regardless of whether the Tories or Labour form the government.

Because there is nothing in the Efford Bill to stop this – or in Burnham’s announcement, in an exclusive interview with the HSJ, published on 30 Oct 2014, that a Labour government would see a significant role for private health care companies in the NHS.

Efford Bill undermines Burnham’s commitment to NHS as preferred provider

Burnham explained that a Labour government would make the NHS the preferred provider, but that this would not prevent commissioners from putting NHS services out to competitive tender, if they could not get what they wanted from the NHS provider.

He told the HSJ that the “simplest way to put it” was that the “first chance” at winning a contract would be given to the NHS.

He said:

“So, there is going to be change, but the NHS will get the first chance to change.
“You don’t immediately go to an open competition, [the NHS] gets the chance to embrace the model.

“But [if commissioners judge the] change isn’t acceptable or not embraced fully, then [we] say: ‘We’ve given you first chance to change but it’s not worked. We now need to open up to different ways of doing things.”

This is the approach that Calderdale Clinical Commissioning Group told the Calderdale Council Adults Health and Social Care Scrutiny Panel they are taking with re-specifying the community health services that the hospitals Trust currently provides.

If the Trust won’t or can’t give the Commissioners what they want, they will put the re-specified services out to competitive tender.

A recognised risk of that process is that the loss of those contracts could further de-stabilise the hospitals Trust, which is already facing a deficit at the end of this financial year which will put it in breach of its licence to operate.

Whatever the merits or demerits of a future Labour government’s support for the NHS as the preferred provider, this support is undermined by the Efford Bill.

Part 1 section 2 gives the Secretary of State the power to overrule decisions by commissioners or providers, on the grounds that they’re anti-competitive. It also gives the right to any health service body or provider that is involved in a dispute about anti-competitive behaviour, to complain to the Secretary of State.

Part 1, Section 2 Exercise of the Secretary of State’s powers clearly shows that a Labour government would still insist on the role of competition in commissioning and providing NHS services. It says the Sec of State would:

“exercise his [sic] powers under this Act [NHS Act 2006]…to ensure that any person who is engaged in commissioning or providing health services for the purpose of the health service …. does not engage in anti-competitive or other behaviour which the Secretary of State considers is against the interest of people who use health services.”

Efford Bill removes ceiling on amount of income Foundation Trusts can earn from private patients

It also seems from the Efford Bill Part 2, Amendments to the financial powers of NHS Foundation Trusts and NHS Trusts…, that it will open the door even wider than the HSCA 2012 did, in terms of the amount of income Foundation Trusts like Calderdale and Huddersfield NHS Foundation Trust hospitals can earn from private patients.

The Health and Social Care Act 2012 allows NHS Foundation Trusts to earn up to 49% of their income from private patients.

The Efford Bill (Part 2, Section 7 (3)) allows the Secretary of State to set the amount of income that Foundation Trusts can earn from private patients – both as an overall limit that applies to all Foundation Trusts, and as individual exceptions from this norm.

So potentially the Efford Bill allows the Secretary of State to tell a Foundation Trust it could earn a higher proportion of its income from private patients, than the HSCA 2012 allows.

The Efford Bill (Part 2, Section 7 (6) also allows NHS Foundation Trusts to carry out activities in addition to its core tasks of providing services to individuals for the prevention, diagnosis and treatment of illness, and for public health, if these extra activities generate additional income to fund their “principal purpose” and these additional activities also benefit NHS patients.

Who knows what this could open the door to?

The Efford Bill also says (Part 3, Section 11) that the Competition Act 1998 shall not apply to the Secretary of State, any NHS body, or any person commissioning or providing services for the NHS. I have no idea what this means.

But the Competition Act 1998 is apparently, according to Wikipedia, “the current major source of competition law in the United Kingdom, along with the Enterprise Act 2002. The act provides an updated framework for identifying and dealing with restrictive business practices and abuse of a dominant market position.”

So this could cut both ways I guess? It could maybe stop private health care companies challenging the award of contracts to the NHS as the preferred provider, by saying that giving a contract to a preferred provider amounts to restrictive practices and abuse of a dominant market position.

But, should a private health care company establish an effective monopoly position as an NHS provider, it would also protect them from challenge on the grounds that they are abusing a dominant market position and engaging in restrictive practices.

What about the repeal of Section 75?

Section 75 is the bit of the privatising Health & Social Care Act 2012 that forces competitive tendering onto Clinical Commissioning Groups, making them comply with EU competition law – although the New Labour government’s creation of the “NHS commissioning market”, had already introduced EU competition/regulations into the NHS in 2007.

By tightly tying in the NHS to competition law, Section 75 has done its intended job of opening up the NHS to private health care company “providers” far faster and more widely than had happened under New Labour’s NHS privatisation policies.

Competition law serves the interests of private companies through banning state-run monopolies.

Section 75 and the rest of the competition bits of the HSCA 2012 have now done their job of breaking open the “state monopoly” NHS budget to private health care companies.

Since the HSCA 2012 came into effect on 1 April 2013, around 75% of NHS contracts have gone to private health care companies.

These new contracts are draining cash from our hospitals. Many now face deficits at the end of this financial year, which could see them taken into the power of special administrators. [More info here: http://www.energyroyd.org.uk/archives/13373]

Mostly these new privatised contracts are for so-called integrated community health and social care services – a model based on an American private health care system that has been pushed on the NHS by management consultants like McKinsey, since the New Labour government opened up the Department of Health to McKinsey in the early years of this century. And that is now being rolled out across England, in the face of significant public protests.

Having served its purpose, section 75 and the rest of the legal means of enforcing competition law could now obstruct the giant corporation that is positioning itself to become the new private monopoly controller of the NHS.

But what of the ties between the NHS and EU competition law, that the Efford Bill maintains through its sleight of hand of categorising the NHS as a Service of General Economic Interest (SGEI)?

How does the Efford Bill’s simultaneous repeal and restoration of competition law play out in this context?

Part 1, Section 6 of the Efford Bill is about NHS contracts. It makes some changes to the NHS Act 2006.

Specifically, Section 6 (5) has some very Alice in Wonderland language, about when a contract that is not between the NHS and a health service body can act as an NHS contract.

And then later sub sections of Part 1 Section 6 go into contortions about when a contract that is not between the NHS and a health service body shall not take effect as an NHS contract.

All this wiggling about whether a contract is or is not an NHS contract is about whether it is or is not subject to EU competition law.

For a giant corporation to take over monopoly control of the NHS, the contract would have to be not subject to EU competition law.

That global giant waiting in the wings is United Health – the company that the NHS England Chief SImon Stevens worked for, after leaving his job as Tony Blair’s adviser on the NHS.

United Health chairs and funds NHS England’s Commissioning Support Industry Group (CSIG).

The CSIG members are eight or nine of the usual management consultancy suspects, including McKinsey, KPMG and PWC. Their role is to look at how Commissioning Support Units will operate once they’re privatised in 2016. http://www.england.nhs.uk/wp-content/uploads/2014/02/item4-board-0114.pdf

As well as chairing and funding this key (and secretive) NHS England committee, United Health has taken the CSIG members on junkets to see its American operations.

United Health has been positioning itself for involvement in commissioning since 2007 when the New Labour government created the “NHS commissioning market”.

Repealing Section 75 opens the door to the possibility that, instead of competing for a share of those services, UH – or another major management consultancy company in the CSIG, or a consortium of them – would be able to take over all of the country’s soon to-be-privatized commissioning support units.

This would complete the privatisation of the NHS.

The Efford Bill reinforces Burnham’s announcement that a Labour government would see a significant role for private health care companies in the NHS. It does not offer any way to reverse or even simply stop NHS sell offs.

Burnham says a Labour government would continue NHS “efficiency challenges”

In an exclusive interview with the Health Service Journal, published on 30 Oct 2014, Burnham explained that a Labour government would make the NHS the preferred provider, but this would not prevent commissioners from putting NHS services out to competitive tender if they could not get what they wanted from the NHS provider.

Burnham said this was “cleverer” than carrying on “driving change into the system by almost saying everything is up for grabs, to be openly tendered,” because by saying “the NHS organisations are not facing an existential threat [and by] providing that security about the provider landscape, the deal is that people are going to have to embrace considerable change in the way that services are provided.”

And the change he is talking about is meeting “efficiency and integration challenges.”

He told the Health Services Journal that ‘There’s no getting away from difficult choices over staff pay,’ and that a Labour government would use pay restraint and make “difficult choices” about the wages of NHS frontline staff if the party wins the election next year.

He says he intends to work with unions, but also said that “there is always a trade-off between what you can pay and job numbers”. This is what Jeremy Hunt was saying at the time of the NHS staff strike last month.

Completing the 1980s Tory plans for NHS privatisation

The 1980s Thatcher government set out plans for NHS privatisation, drawn up by John Redwood and Oliver Letwin.

They have been brought in since then by both Tory governments and New Labour with their McKinsey advisers.

The Efford Bill will maintain the CCG infrastructure created by HSCA 2012 following Redwood’s and Letwin’s 1980s NHS privatisation design.

Labour’s current policy on clinical commissioning groups can be found in Andy Burnham’s interview with the HSJ, published on 30/10/14, when he suggested that clinical commissioning groups could be morphed into the operational arms of the health and wellbeing boards, which will take on the role of “signing off” health plans.

Dr Lucy Reynolds and other critics of the HSCA 2012 have explained how the CCG infrastructure is designed to collapse into a minimal system serving only the very poor, as private health insurance moves into the role once occupied by the NHS.

The CCGs’ funding pools are designed to shrink down into a minimal Medicaid-style service through a “voucher system” called “money following the patient”.

This is evident from the “patient-centric” design of the Right Care Right Time Right Place integrated community health and social care system, that is designed to replace existing acute and emergency hospital services.

Privatising the NHS, closely tracking individual patients’ costs to the NHS and paying health care providers by outcomes will lead to cherry picking of patients who can be successfully treated relatively cheaply.

The Efford Bill safeguards this NHS privatisation infrastructure, while removing the only legal barrier to a private monopoly takeover or all or part of the NHS – that being Part 3 of HASCA 2012 that ties the NHS into competition law.

Now that it’s done its job of opening up the NHS to big-time privatisation it can be ditched.

The Times on the 13th of October reported that the Tories too were backtracking on the competition sections of the HSCA 2012, saying this was their “mistake” on the NHS and they didn’t know what they were doing.

Because Section 75 and the other competition bits of Part 3 of the HSCA 2012 have done their job.

And if they’re left in place, they could prevent the final stage of NHS privatisation – its effective takeover by a global private healthcare company or consortium of companies.

Updated 17/11/2014 with information about the Efford Bill con trick – claiming that its repeal of Section 75 of 2012 HSCA takes the NHS out of EU competition law, while undermining this by categorising the NHS as a Service of General Economic Interest (SGEI), which subjects the NHS to EU Competition Law, and so maintains corporate rights to the NHS budget.

When I first read the Efford Bill, I didn’t know what categorising the NHS as an SGEI meant. It took me a while to find out.

Appendix

This is what the Efford Bill would repeal from HSCA 2012 Part 3:

“62 (2)In carrying out its main duty, Monitor must have regard to the likely future demand for health care services.”

“62 (3)Monitor must exercise its functions with a view to preventing anti-competitive behaviour in the provision of health care services for the purposes of the NHS which is against the interests of people who use such services.”

“62 (10)Monitor must not exercise its functions for the purpose of causing a variation in the proportion of health care services provided for the purposes of the NHS that is provided by persons of a particular description if that description is by reference to—

(a)whether the persons in question are in the public or (as the case may be) private sector, or

(b)some other aspect of their status.”

“67 (3)Monitor must ignore the functions it has under sections 111 and 113 when exercising—

(a)its functions under Chapter 2 (competition);

(b)its functions under Chapter 4 (pricing).”

Sections 72-80 are the Chapter on Competition.http://www.legislation.gov.uk/ukpga/2012/7/part/3/chapter/2/enacted

They are mostly about relations between MOnitor and OFT, (72- 74, 80)
Procurement, patient choice and competition (Section 75)
Implications of Section 75 (76-78)
Mergers involving NHS Foundation Trusts (79)

You can read the Efford Bill here: http://www.publications.parliament.uk/pa/bills/cbill/2014-2015/0018/cbill_2014-20150018_en_1.htm

You can watch NHS for the Common Good here http://www.energyroyd.org.uk/archives/12213 and see how the process of selling off the NHS works.

Update 19/11/2014 Dr Lucy Reynolds has posted her response to the Efford Bill here: http://nhaspace.wordpress.com/2014/11/18/the-efford-bill-a-trojan-horse/

I have written to Calder Valley MP Craig Whittaker, asking him to seek and vote for clarifications and amendments to the Efford BIll on 21/11/2014 – here https://www.scribd.com/doc/247068753/Email-about-Efford-Bill-to-MP

Update: Since I posted this, Professor Pollock has published her response to the Efford Bill – here: http://www.nhsbill2015.org/wp-content/uploads/2014/11/Response-to-the-Efford-Bill-12-Nov-14.pdf

This is why I think the London Socialist Health Association are wrong about the Efford Bill https://www.scribd.com/doc/246869185/Why-the-London-Socialist-Health-Association-is-Wrong-About-the-Efford-Bill

Promoted by Mark Mullany on behalf of Jenny Shepherd and Calderdale Green Party all at 1, Post Office Buildings, Barkisland, Halifax HX4 0AL

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3 comments

  1. Jenny – this is a brilliant and comprehensive analysis. What at PR stunt the Labour Party has pulled to get all their support and all night vigils, etc, in place for Efford’s Bill before it was published.

    I presume the Bill will pass its second reading?

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