NHS Privatisation

Myth, reality, threat?

When people say the NHS is being privatised, what do they mean? Privatisation in Britain usually means the flotation model. A government organisation is sold off as shares, transferring both ownership and control to the private sector. Such an approach was never going to work for the NHS. The very idea that a hospital might be auctioned or that British citizens would be charged at the point of need is so far outside acceptable politics that you’ll only ever hear it from Nigel Farage.

Instead, what we’ve seen is the subtle but relentless opening up of the NHS to profit-seeking organisations. Virgin now run 230 NHS services in England. Whilst winning contracts of around £1bn, the company uses tax havens to avoid paying corporation tax. Outsourcing in general has also shot up, from £1.2bn in 2012/13 to £9.6bn in 2014/15. The pace only increases. Last month , £7.9bn of services was put out to tender. Meanwhile, the legal ability of commissioners to select providers according to ethical criteria, such as tax, is being called into question.

Whilst outsourcing retains the principle of free-at-the-point-need, it undermines the longstanding practice of cross-subsidy, itself a reaction to the introduction of the internal market, in which hospitals offset the cost of expensive procedures against cheaper ones. Outsourcing also increases the ‘transaction cost’ of commissioning. The formidable price of awarding all these contracts is borne by the public purse. In 2010, the Health Select Committee found it took up 14% of the entire NHS budget. They also criticised the Department of Health for not providing “clear and consistent data”, accusing it of a cover up.

Elsewhere, in the completely overhauled structure which David Cameron pledged to leave alone during the 2010 election, Clinical Commissioning Groups of GPs are tasked with commissioning precisely these services, a monumental undertaking formerly conducted by PCTs and sometimes outsourced to those friends of the people, the management consultants. The government says CCGs are closer to their communities than Whitehall. This may be true, but something else the CCGs can be is entrepreneurial, independent and more open to private partnerships than the PCTs they replaced.

What does all this amount to? We’re still, both in law and practice, a good distance from a fully privatised health system. Hospitals remain (just) legally required to receive more income from public than private patients. The expectation and reality of healthcare in Britain is still of a comprehensive and non-discriminatory service. But - and as buts go, this is a big one - the idea that Britain needs to move from socialised medicine to a system of privately-insured individuals is alive and well.

At this year’s Tory party conference, you could attend a fringe event called Putting Patients First. It was hosted by the Institute of Economic Affairs, a group which favours “liberating the private sector” so that “the NHS [becomes] less and less relevant.” Senior Tories have also expressed a desire to “break down the barriers between private and public, in effect denationalising health care in Britain.” Those senior Tories include Jeremy Hunt. And the Tory’s man at the top of NHS England since 2013 is Simon Stevens. His background? US Private healthcare.

It seems likely the deep-state of the Conservative party has committed itself to a war of attrition against the NHS. They know a Thatcher-style privatisation is never going to work, so they’ve dug in for the long haul. No one will ever say, “Privatisation is the way to efficiency” or ask you to vote on it. But one contract, one outsourced provider, one seemingly insignificant legal change at a time, the founding principles of a socialised health service will be chipped away and replaced with the relentless and uncaring imperative of profit.

Is the NHS being privatised? Yes. But, please, whatever you do, don’t tell anyone.

Published in Now Then magazine, November 2016.