00 - Commissioning - Vol II oral+written€¦ · 121 Centre for Public Policy and Health, Durham University Ev w354 122 Royal College of Midwives further evidence Ev w359 cobber Pack:

HC 513-II Published on 21 January 2011

by authority of the House of Commons London: The Stationery Office Limited

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House of Commons

Health Committee

Commissioning

Third Report of Session 2010–11

Volume II

Oral and written evidence

Ordered by the House of Commons to be printed 13 January 2011

The Health Committee

The Health Committee is appointed by the House of Commons to examine the expenditure, administration, and policy of the Department of Health and its associated bodies.

Membership

Rt Hon Stephen Dorrell MP (Conservative, Charnwood) (Chair)1 Rosie Cooper MP (Labour, West Lancashire) Nadine Dorries MP (Conservative, Mid Bedfordshire) Yvonne Fovargue MP (Labour, Makerfield) Andrew George MP (Liberal Democrat, St Ives) Grahame M. Morris MP (Labour, Easington) Mr Virendra Sharma MP (Labour, Ealing Southall) Chris Skidmore MP (Conservative, Kingswood) David Tredinnick MP (Conservative, Bosworth) Valerie Vaz MP (Labour, Walsall South) Dr Sarah Wollaston MP (Conservative, Totnes) The following was a member of the Committee during this inquiry: Fiona Mactaggart MP (Labour, Slough)

Powers

The Committee is one of the departmental select committees, the powers of which are set out in House of Commons Standing Orders, principally in SO No 152. These are available on the Internet via www.parliament.uk.

Publications

The Reports and evidence of the Committee are published by The Stationery Office by Order of the House. All publications of the Committee (including press notices) are on the Internet at www.parliament.uk/healthcom. The Reports of the Committee, the formal minutes relating to that report, oral evidence taken and some or all written evidence are available in printed volume(s). Additional written evidence may be published on the internet only.

Committee staff

The staff of the Committee are David Lloyd (Clerk), Sara Howe (Second Clerk), David Turner (Committee Specialist), Steve Clarke (Committee Specialist), Frances Allingham (Senior Committee Assistant), and Ronnie Jefferson (Committee Assistant).

Contacts

All correspondence should be addressed to the Clerk of the Health Committee, House of Commons, 7 Millbank, London SW1P 3JA. The telephone number for general enquiries is 020 7219 5466. The Committee’s email address is [email protected].

1 Mr Stephen Dorrell was elected as the Chair of the Committee on 9 June 2010, in

accordance with Standing Order No. 122B (see House of Commons Votes and Proceedings, 10 June 2010).

Witnesses

Tuesday 19 October 2010 Page

Sir David Nicholson KCB, CBE, Chief Executive of the National Health Service, Dame Barbara Hakin DBE, National Managing Director of Commissioning Development, Dr David Colin-Thomé OBE, National Director for Primary Care and Medical Adviser, and Ben Dyson CBE, Director of Primary Care, Department of Health Ev 1

Tuesday 2 November 2010

Professor Steve Field, Chair of Council, Royal College of General Practitioners, Dr Richard Vautrey, Deputy Chair, General Practitioners Committee, British Medical Association, Dr James Kingsland, President, National Association of Primary Care, and Michael Sobanja, Chief Officer, NHS Alliance Ev 21

Dr Paul Charlson, GP, Hull, Dr Peter Davies, GP, Halifax, Dr Kambiz Boomla, GP, Tower Hamlets, and Dr Jonathon Tomlinson, GP, Hackney Ev 33


Professor Julian Le Grand, London School of Economics, Professor Martin Roland, Cambridge University, Professor Jennie Popay, Lancaster University, and Professor Steve Harrison, Manchester University Ev 43

Professor Chris Ham, Chief Executive, King’s Fund, Dr Jennifer Dixon, Director, Nuffield Trust, and Professor Gwyn Bevan, London School of Economics Ev 53


Dr Peter Weaving, Cumbria PBC consortium, Anthony Farnsworth, Torbay Care Trust, Nigel Edwards, NHS Confederation, and Dr Paul Zollinger-Read, Commissioning transition lead for East of England SHA and interim Chief Executive of Peterborough PCT Ev 64

John Seddon, Vanguard Consulting (visiting Professor at Cardiff University Business School; fellow at ResPublica, Kingsley Manning, Executive Chairman – Health, Tribal, and Alan Downey, Partner and Head of Public Sector, KPMG Ev 75

Tuesday 7 December 2010

Jeremy Taylor, Chief Executive, National Voices, Katherine Murphy, Chief Executive, the Patients Association, Sophie Corlett, Director of External Relations, Mind, and Andrew Harrop, Director of Policy and Public Affairs, Age UK Ev 86

Karen Jennings, National Secretary for Health, UNISON, John Ransford CBE, Chief Executive, Local Government Association Group, Dr Frank Atherton, President, The Association of Directors of Public Health, and David Worskett, Director, NHS Partners Network Ev 98

Wednesday 15 December 2010

Rt Hon Andrew Lansley CBE MP, Secretary of State for Health, Dr David Colin-Thomé OBE, National Clinical Director for Primary Care, and Dame Barbara Hakin DBE, National Managing Director for Commissioning Development, Department of Health Ev 108

List of printed written evidence

1 Department of Health Ev 129

2 Tribal Consulting Ltd Ev 139

3 UNISON Ev 143

4 Association of Directors of Public Health Ev 147

5 The Nuffield Trust Ev 150

6 Local Government Association Ev 155

7 British Medical Association Ev 159

8 The King’s Fund Ev 163

9 Royal College of General Practitioners Ev 168

10 Dr Peter Davies Ev 173

11 Dr Peter Davies supplementary Ev 175

12 Dr Jonathon Tomlinson Ev 175

13 Dr Jonathon Tomlinson supplementary Ev 176

14 Professor Martin Roland Ev 177

15 Dr Paul Charlson GP Ev 178

16 Professor Gwyn Bevan Ev 180

17 Dr Peter Weaving Ev 185

18 NHS Partners Network Ev 186

19 Mind Ev 188

20 National Voices Ev 189

21 Primary Care Trust Network supplementary Ev 193

22 Age UK supplementary Ev 195

23 NHS Confederation Ev 199

List of additional written evidence

(published in Volume III on the Committee’s website www.parliament.uk/healthcom)

1 The Royal College of Radiologists Ev w1

2 Cystic Fibrosis Trust Ev w2

3 Sustrans Ev w4

4 Mary E Hoult Ev w7

5 National Kidney Federation Ev w8

6 Specialised Healthcare Alliance Ev w10

7 Mr Gerald Rigler Ev w12

8 Royal College of Paediatrics and Child Health Ev w14

9 Family Planning Association Ev w15

10 Mencap Ev w17

11 Londonwide LMCs Ev w19

12 City of London LINk Ev w20

13 Independent Mental Health Services Alliance Ev w21

14 Help the Hospices Ev w23

15 Partnerships in Care Ev w27

16 Oxfordshire County Council Ev w28

17 National Centre for Young People with Epilepsy Ev w32

18 The Company Chemists’ Association Ltd and the Association of Ev w36

Independent Multiple Pharmacies Ltd

19 RNIB Ev w39

20 UK Commissioning Public Health Network Ev w41

21 Central London Healthcare CIC Ev w43

22 Society of Chiropodists and Podiatrists Ev w45

23 Benenden Healthcare Society Ev w47

24 Association of Directors of Adult Social Services Ev w50

25 2020 Public Services Trust Information and Technology Group Ev w54

26 Audit Commission Ev w58

27 National Children’s Bureau Ev w65

28 Dr Corinne Camilleri-Ferrante Ev w71

29 Terence Lewis, Lewis Governance Ev w72

30 The Kidney Alliance Ev w75

31 Shire Pharmaceuticals Ltd Ev w79

32 Better Value Healthcare Ev w82

33 Allied Health Professions Federation Ev w83

34 Independent Midwives UK Ev w86

35 National Osteoporosis Society Ev w89

36 The Chartered Society of Physiotherapy Ev w93

37 Muscular Dystrophy Campaign Ev w97

38 Weight Watchers UK Ev w100

39 London Specialised Commissioning Group Ev w104

40 Royal College of Psychiatrists Ev w108

41 Baxter Healthcare Ltd Ev w112

42 Royal College of Midwives Ev w113

43 Ultrasis UK Ltd Ev w116

44 Haringey Better Local Healthcare Campaign Ev w119

45 The Pharmaceutical Services Negotiating Committee Ev w121

46 Genzyme Therapeutics Ltd Ev w124

47 Dr Jonathan Howell Ev w125

48 British Pregnancy Advisory Service Ev w129

49 LighterLife Ev w131

50 National Association for Voluntary and Community Action Ev w135

51 County Councils Network Ev w139

52 Genetic Alliance UK Ev w141

53 Cambridge Weight Plan Ev w143

54 Mr David Allen Ev w147

55 Paediatric Continence Forum Ev w149

56 National Specialised Commissioning Group and NHS Specialised Ev w151

Services Team

57 Assura Medical Limited Ev w155

58 National Infertility Awareness Campaign Ev w157

59 Actelion Pharmaceuticals Ltd Ev w159

60 Parkinson’s UK Ev w161

61 Joint Epilepsy Council Ev w163

62 National Housing Federation Ev w167

63 South East Coast Specialised Commissioning Group Ev w172

64 Brook Ev w175

65 British Dental Association Ev w177

66 Rare Disease UK Ev w181

67 British Heart Foundation Ev w183

68 The LIFT Council Ev w187

69 Samaritans Ev w189

70 Tunstall Healthcare Ltd Ev w192

71 Action Duchenne Ev w194

72 Health Foundation Ev w197

73 British Association for Adoption and Fostering Ev w201

74 Turning Point Ev w206

75 British In Vitro Diagnostics Association Ev w213

76 National Spinal Cord Injury Strategy Board Ev w214

77 Optical Confederation Ev w220

78 Lundbeck Limited Ev w222

79 Association of the British Pharmaceutical Industry Ev w226

80 Intellect Ev w231

81 St Mungo’s Ev w233

82 Changing Faces Ev w236

83 Royal College of Physicians Ev w239

84 North West Specialised Commissioning Group Ev w242

85 Dr Daphne Austin Ev w245

86 The Hepatitis C Trust Ev w247

87 Abbott UK Ev w249

88 Bliss Ev w253

89 Cancer Research UK Ev w254

90 Urology Trade Association Ev w257

91 Keep Our NHS Public Ev w260

92 The Mental Health Foundation Ev w263

93 Dr Giri Rajaratnam Ev w268

94 Breakthrough Breast Cancer Ev w270

95 The Princess Royal Trust for Carers and Crossroads Care Ev w271

96 Sands Ev w274

97 National Family Intervention Strategy Board Ev w277

98 Managers in Partnership Ev w280

99 Royal College of Nursing Ev w283

100 Homeless Link Ev w289

101 Carers UK Ev w293

102 Experts in Severe and Complex Obesity Ev w296

103 UnitedHealth UK Ev w300

104 Aetna UK, Humana Europe, Tribal Group and UnitedHealth UK Ev w304

105 Atrial Fibrillation Association Ev w305

106 Macmillan Cancer Support Ev w307

107 Arrhythmia Alliance Ev w311

108 British Association for Sexual Health and HIV Ev w313

109 PNH Alliance Ev w316

110 Astellas Pharma Ltd Ev w317

111 Terrence Higgins Trust Ev w318

112 Neurological Commissioning Support Ev w321

113 Professor Alan Maynard Ev w326

114 Air Products Healthcare Ev w330

115 Motor Neurone Disease Association Ev w332

116 Manchester Joint Health Unit Ev w337

117 Health Care Professionals Commissioning Network Ev w344

118 Dr Stan Darling Ev w345

119 Centre for Public Scrutiny and NHS Alliance Ev w346

120 Health Experiences Research Group Ev w351

121 Centre for Public Policy and Health, Durham University Ev w354

122 Royal College of Midwives further evidence Ev w359

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Health Committee: Evidence Ev 1

Oral evidenceTaken before the Health Committee

on Tuesday 19 October 2010

Members present:

Mr Stephen Dorrell (Chair)

Rosie CooperAndrew GeorgeFiona MactaggartGrahame M MorrisMr Virendra Sharma

________________

Examination of Witnesses

Witnesses: Sir David Nicholson KCB, CBE, Chief Executive of the National Health Service, Dame BarbaraHakin DBE, National Managing Director of Commissioning Development, Department of Health, Dr DavidColin-Thomé OBE, National Director for Primary Care and Medical Adviser, Department of Health, and BenDyson CBE, Director of Primary Care, Department of Health, gave evidence.

Q1 Chair: Ladies and gentlemen, thank you forcoming to the Committee this morning. Welcome,again, Sir David, and your colleagues for the firsttime.As you know, the Committee has decided to launchthis inquiry into commissioning believing that morethan 20 years after the introduction of the purchaser/provider split, as it used to be called, it is time to askof the Government’s proposals in its White Paperwhat, I think, we regard as the core question, whichis how the proposals in this White Paper are going tomake the commissioning process more effective thanit has yet proved to be.In the Terms of Reference the Committee published,we referred to the inquiry the Health Committeecarried out in the last Parliament which concluded,and I quote: “Weaknesses are due in large part toPCTs’ lack of skills, notably poor analysis of data,lack of clinical knowledge and the poor quality ofmuch of PCT management. The situation has beenmade worse by the constant re-organisations and highturnover of staff.” That was, I guess, where we werewhen the new Government took office. I want to startthe discussion this morning with what I regard as theGovernment’s central conclusion in its White Paper,which is that, if we want to make commissioningeffective, PCTs as they are now simply have to beregarded as broken, and we have no choice but tostart again. That seems to me to be the central policyconclusion of the White Paper.First of all, is that a fair characterisation of the WhitePaper that it concluded we simply have to start again,and why did the Government reach that conclusion,because there clearly was an alternative which couldhave been based on evolution? Many of the questionswe want to ask this morning flow, it seems to me,from the central conclusion that we have to startagain, and I think we should begin by exploring whythe Government reached the conclusion that that wasthe best way forward.Sir David Nicholson: Thanks for the introduction. Iam sure you are well aware that the consultation onthe White Paper ended just over a week ago and we

Chris SkidmoreDavid TredinnickValerie VazDr Sarah Wollaston

are currently preparing the Government’s response,which will come out in December, as a precursor tothe Bill. So we are meeting at absolutely the right timein the sense that many of the issues that I am sure youwill describe have not formally been absolutely naileddown. So there is a conversation to be had about thestrengths and weaknesses of a variety of positions, andI hope the Committee will take our conversation inthose terms—that we are working towards resolvingsome of these issues.I think that is true about the White Paper as a whole.If you think about the kind of strategic objectives ofthe White Paper—more focus on outcomes, moreclout for individual patients, aligning clinical,managerial and financial levers in the same kinds ofplace—you see that there is widespread agreementthat that is the right thing to do. But in any kind ofWhite Paper of this type there is both continuity anddiscontinuity, and I think we have a bit of both in here.We have learnt quite a lot of lessons over the last 20years about a variety of forms of commissioning. Thequestion, I think, that the coalition faced, and indeedwe faced, was whether we would make the kind ofstep change we needed in commissioning, in terms ofboth the speed and the comprehensive nature of theimplementation, particularly in the financialenvironment that the NHS is moving to, by simplyhaving one more push on World Class Commissioningand one more push on Practice-BasedCommissioning? The Government came to theconclusion that that would not deliver the benefits thatwe wanted. That is not to say we should throw awayall of the past—the knowledge, understanding,expertise and skills in all of that—but we need to takeit to a completely different level, and I think that isthe context in which we are having those discussions.

Q2 Chair: I understand the context, but it still seemsto me that there was an option, which was to take theexisting core skills of the PCTs and develop themrather than start again, and I would just be interestedto know what the argument was that convinced the

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Ev 2 Health Committee: Evidence

19 October 2010 Sir David Nicholson KCB, CBE, Dame Barbara Hakin DBE, Dr David Colin-Thomé OBEand Ben Dyson CBE

Government to start again rather than to evolve theexisting institutions.Sir David Nicholson: Okay. If you look at whatcommissioning is, it is often kind of caricatured assome kind of transaction arrangement, but of courseit isn’t that at all. It has a major strategic context inrelation to whole population planning. It is a majorissue in relation to managing clinical change andmaking clinical change happen, and then it involvesthe kind of monitoring and transactional stuff.It was clear that reform of Practice-BasedCommissioning—which was the major way in whichwe could take forward the clinical change bit, whichis often the bit that is the most difficult to do—wouldnot deliver that clinical impact because, simply, thepower relations were in a different place. You did notalign financial accountability with clinicalaccountability, so a step change in relation to Practice-Based Commissioning was required, and within thecontext of the PCTs it was felt that we were not ableto do that.Then, secondly, on the whole population-basedplanning and commissioning that is required, we havea lot of expertise, lots of understanding and a lot ofdevelopment in local government, which was in lotsof ways significantly ahead of the way we haddeveloped commissioning in this regard in the NHS.So using that as the other bit seemed to us the bestway forward. So a mixture of taking forward thealignment of clinical and financial accountability andbuilding on the expertise, knowledge and progress inwhole population-based commissioning working inlocal government was the right thing to do rather than,in a sense, pushing PCTs through another wave ofWorld Class Commissioning.

Q3 Valerie Vaz: So why don’t you build on it then?Why are you changing everything?Sir David Nicholson: We are building on it.

Q4 Valerie Vaz: But you are not. You are changingit.Sir David Nicholson: We are changing the structuralnature of it, absolutely right, but one of the lessonsthat we have learnt about World ClassCommissioning, which I don’t think came outparticularly well in relation to the work that theCommittee did before, was in relation to outcomes.World Class Commissioning did a lot of work forPCTs identifying outcomes and you can see thosePCTs that focused on outcome priorities had thebiggest movement and change in them compared withthe rest. We are learning from those sorts of thingsand hopefully transferring that over to the new system.We learnt lots of lessons about Practice-BasedCommissioning and, as you undoubtedly know, someof the leading Practice-Based Commissioners werearguing for “hard” budgets—as they described them—as a way of taking their service forward. We are goingto do that as well. So I think it is possible to takeforward some of those things into the new system.

Q5 David Tredinnick: Sir David, I hear what youare saying. You are taking out two enormous tiers of

the structure. The PCTs are going and the StrategicHealth Authorities. I hear what you are saying aboutthe more effective commissioning process at doctorlevel, but how are we going to make major strategicdecisions? Are these going to be made down the roadat the Department? It seems that we are creating ahuge gap between the top and the bottom.Sir David Nicholson: I am sure we will get into thisin detail. I am sure my colleagues can respond to thisas well. One thing that we are doing is creating awhole commissioning system, and if you seecommissioning as the Commissioning Board here andthe consortia there and the kind of relationshipbetween the two is what happens, I think it is tomisunderstand the nature of the system we are goingto create. For example, we have a lot of experienceand knowledge on both national commissioning ofhighly specialised services and regionalcommissioning of specialised services. Thearrangements we have put forward in the White Papersay that the National Commissioning Board will takeresponsibility for both of those elements—both thenational specialist commissioning and the regionalspecialist commissioning. So that is a major plank ofcommissioning expertise, knowledge andunderstanding.

Q6 David Tredinnick: Forgive me for interrupting.So that is being taken up. That is being taken fromthe regions to the centre?Sir David Nicholson: It will be the responsibility ofthe Commissioning Board. The issue for theCommissioning Board is how you best do it. The ideaof just standing at the centre and trying to do it isnonsensical. I am sure you will have some kind ofsub-national mechanism to make sure you make theconnection.

Q7 David Tredinnick: So there will be a terrificallyempowered Commissioning Board, much morepowerful, because that which was done in the regionscomes up and then there is a redevelopment of whatwas once GP commissioning and the structure there,but it seems there is not much glue in the middle?Sir David Nicholson: The National Health ServiceCommissioning Board does not yet exist. We arecurrently working through how you take it from wherewe are now to the new system. I think you will see avariety of mechanisms by which the National HealthService Commissioning Board will be powerfulnationally but actually will be active locally. If youtake, for example—and I’m sure we will get on tothis as well—maternity services, you can’t nationallycommission that. The Commissioning Board will haveto have some mechanism locally to enable it to dothat.

Q8 Rosie Cooper: Could we just split up theDepartment of Health and the Commissioning Board?Is that what you are really telling me, because in afunny way that is what I am hearing?Sir David Nicholson: No, not at all. The Departmentof Health, of course, is responsible both for provisionand commissioning and public health. The National

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Health Service Commissioning Board will beresponsible for the commissioning of the NHS. TheWhite Paper sets out very clearly that the bulk ofservices will be commissioned by consortia but thatthe National Health Service Commissioning Boardwill have responsibility for regional specialistcommissioning and a variety of primary carecommissioning. So that is not the same as theDepartment of Health by any stretch of theimagination.

Q9 Fiona Mactaggart: Can you explain why it hasbeen given maternity services because that is one ofthings that I don’t understand about the White Paper?Sir David Nicholson: There are probably three mainreasons why that is the case. The first thing is thatmaternity is not an illness service. It is not deliveredin that kind of way.

Q10 Fiona Mactaggart: Even more reason for it tobe done locally, but do carry on.Sir David Nicholson: The link with generalpractitioners is not obvious, which is the secondreason. General practitioners do not have the sameimpact on demand that they have in other areas. Thethird one is that it is increasingly not a medical modelof care for mothers and children. That is not to saythat the consortia will not be involved in it, but it isvery clear that the National Health ServiceCommissioning Board will be responsible for leadingcommissioning on it on the basis of those three thingsthat I have just said.Chair: Can we try and move in a reasonablystructured way? Obviously it is all one subject andyou are right, Sir David, that we shall, I think, returnto these themes later on in the session, but we thoughtit would be sensible to move now to explore questionsthat Sarah is going to ask.

Q11 Dr Wollaston: In a sense this is a massive re-organisation of the NHS and I think what a lot ofclinicians are concerned about is the evidence basebehind this. Of course clinicians do welcome the ideathat you have more clinical leadership in the NHS toexert those levers in the right direction, but can youjust put us in the picture about where the evidencebase is and why we are not seeing more “pilots” forthis?Sir David Nicholson: I am sure one or two of mycolleagues will want to come in on this, but in termsof the evidence base, even from this country there isgood evidence for the idea that “focusing on outcomesdelivers change”. So with regard to the outcome stuff,I think, there is quite a good evidence base for that.

Q12 Dr Wollaston: For the outcomes, yes, but I amtalking about the structure—GP commissioning.Sir David Nicholson: Well, okay. Again, for patientengagement and empowerment, there is goodevidence that shows empowered patients get betterquicker and use less resource.In terms of putting power into the hands of GPs, wehave quite a lot of experience in this going back morethan 20 years. We had GP fundholding; we had total

commissioning; we had primary care groups; we hadPCTs; we had World Class Commissioning; we hadPractice-Based Commissioning. Out of that there is ahuge body of experience and knowledge about whatworks. That is not a random controlled trial, but Ithink there is quite a lot of experience and knowledgeabout the strengths and weaknesses of how thatworked on one hand, and on the other hand the realityis, as you know probably better than most, that everytime a GP refers a patient or writes a script, that iscommissioning activity. You are commissioning awhole set of services. So, if you put those two thingstogether, what we are trying to get at is, what is thebest way of connecting that experience with thatreality?

Q13 Dr Wollaston: Sure. I think most people acceptthat actually having clinical leadership in the NHSmakes a difference, but the fact is that this is amassive reorganisation and there don’t appear to beany pilots of this particular model. Would it not havebeen better to pilot this in certain regions and then seewhere the glitches are and move on from there, ratherthan have wholesale, across the system, change?Sir David Nicholson: I think there are two things. Alot of people have talked about the speed of all of this,and there is no doubt the coalition have been veryquick off the mark in terms of delivering their visionfor what the NHS of the future might look like. Whenyou think it took, I think, Mrs Thatcher 10 years todeliver her plan for reform; it took Tony Blair aboutsix years; and it has taken the coalition, I think, 60days to do that. So the speed is fantastically important.The thing about the speed is that it makes it very clearright at the beginning what the vision is. The issueabout how you get to that vision then—I think youare absolutely right—is that you need to take it a stepat a time and be sensible and reasonable about it. Ifyou think about it, we have got until 1 April 2013.That is the first time that the consortia will bestatutorily able to take on a budget—that is two and ahalf years away—and we have got till 2014 forfoundation trusts. So, we have got two and a half tothree and a half years to take this forward in a logicaland sensible way, and we propose to use that timeeffectively for doing it.But if you look back and think about Practice-BasedCommissioning, in lots of ways that was pilotingsome of the aspects of some of the consortia powersthat we will be getting. So we have got someexperience of that. We have not finalised how we aregoing to roll all of this out, but we are going to takethe appropriate amount of time to get from where weare now to the place we’re going in two and a halfyears. The issue from the service now is that peoplewant me to speed it up rather than slow it down.

Q14 Dr Wollaston: But some things are happeningvery quickly. If you take the definite purchaser/provider split, a comment from many people that Ihave talked to has been that that has been too rapid toallow setting up, for example, of social enterprises insome areas. Do you have concerns about the pace?




Sir David Nicholson: The last time that we tried todeal with the outstanding issues in the purchaser/provider split was in 2005–06—in Commissioning apatient-led NHS. What happened after that was that in2007 we set out to the service that over the next periodwe expect people to deliver the purchaser/providersplit, and it is particularly community services we aretalking about. In 2007, I wrote out to the servicesaying to do it and we gave a series of deadlines, allof which the NHS missed. So, during the period ofthe last Government, we set out another deadlinewhich came out as part of “Good to Great”. We put31 March 2011 as the date when that would becompleted and there was lots of evidence that peopleweren’t pushing it hard enough, because they aredifficult decisions to make and many PCTs did notwant to give up their provider arm for a whole varietyof reasons. Lots of PCTs like running things as wellas commissioning things.What the coalition have done is absolutely made clearthat timetable. My view, for what it is worth, is wecould have had a timetable in five years’ time andthey still wouldn’t have delivered. We had to make adecision to do it and, all right, in most places it hasworked fine and people have got on and done it. Insome places, it has been, I think, more difficult, butthe issue for me was the prize of getting the splitbetween commissioning and provision which, for awhole variety of reasons, we failed to do over the lastfew years. So, I do not think it was a short-term thing.We have been talking about this for at least three orfour years.

Q15 Grahame Morris: Can I just develop this pointabout the scale and pace of change in commissioningbecause the Committee has heard evidence from anumber of individuals and organisations—the RoyalCollege of GPs and a number of stakeholders,including trade unions’ concerns—about the pace ofchange posing major operational risks to the NHS. Weare not talking about a five-year track production planhere. We are talking about the health of the nation. SoI would be interested in your professional view, as theChief Executive of the NHS, in terms of that and alsoin terms of the evidence base that my colleague Sarahreferred to about the international experience in termsof primary care and GPs commissioning secondarycare. What is the evidence base from what ishappening internationally to support what we aredoing here?Sir David Nicholson: I will ask Barbara to talk aboutthe evidence. In any management of change work thatyou do, there are arguments for speeding things upand slowing things down, and I think we have takena relatively middle rate in relation to that because wewere very concerned that we needed to build a newsystem. As I say, it is not just the consortia. It is theregional Commissioning, the national Commissioningand all those things we need to build the whole systemas we go forward.At the same time, of course, we are, as we discussedat the last Committee, facing the biggest financialchallenge the NHS has ever faced. So do you go slow

or do you go fast in that environment? That is a matterof some debate and some discussion.What I would say is that, once you announce a set ofchanges like the White Paper, things start to happenirrespective of whether you want to go slow or fast.Already you see people wanting to move out of PCTs.You already see problems in some parts of the countrysustaining the commissioning capability there so that,in a sense, drives you to need to get the consortiaworking as fast as you possibly can. It is the nature ofchange management.I think, if you look at the evidence around big changeelsewhere, three or four years is a reasonable amountof time to make that happen, but that is not to say thatin 2013–14 we’ll have a new system runningcompletely perfectly. It will take several years for thatsystem to mature and bed down after that.Dame Barbara Hakin: I have something to add tothat. I think it is difficult with something like thisbecause clinicians are used to double blind trials andcarefully constructed randomisation, which is moredifficult, but I do think there is a wealth of evidenceboth in this country and internationally thatconnecting clinicians much more into the design ofservices for patients and the resource committees intoresponsibility for the resource for patients actuallydoes make a huge difference. We have significantnumbers of examples both from this country andabroad from where that has happened and it makes adifference to the quality of the care that the patientsget in terms of both their experience and effectiveness.I think the main aim of this change really is to tipback into a situation where there is more clinicaldominance than the administrative and technicaldominance. The NHS always tries very, very hard tokeep clinical change and making things best forpatients at the heart of everything that it does, and Ithink that lots of things that happened through PCTshelped us learn lots of lessons about World ClassCommissioning, the technical aspect and the bigstrategic aspects, but we lost some of our frontlinepeople. We lost those very people who see patients ona day-to-day level and have a more intimateunderstanding of their needs, and actually all dayevery day listen to what patients find good and badabout the system.Again, I think David has got some internationalexamples. We could give you a range of examplesfrom this country where Practice-BasedCommissioning consortia actually have made hugedifferences to the clinical quality and often to theproductivity—to the elimination of waste in terms ofcare for patients. If you start to look abroad, certainlyin New Zealand, there are some quite significantchanges in regard to giving primary care a much moredominant role in commissioning. There aren’t alwaysanalogies, of course, because our primary care systemand our general practices in England are unique. Thereis nowhere else really where an absolutely holisticview of patient care is held centrally. There is a recordwhich travels with the patient for life. That is thepremise and the basis for this change, which I wouldargue probably needs to be significant to get themindset change we need, because actually our




frontline clinicians don’t own this. So we need themindset change, which needs time and radical changein the organisational shape.We have a system whereby general practice in thiscountry is responsible for co-ordinating all aspects ofcare that patients get, and therefore it seems that theyare absolutely best placed to co-ordinate thecommissioning. They wouldn’t dream of doing all thecare themselves and they work very hard with patientsthemselves. They refer patients to a broad range ofother clinicians at all times, but that central co-ordinating role is the one that we have in this countrywhich is really very different from anywhere else.David, I am sure you can give us specific examples.Dr David Colin-Thomé: On the clinical connection,of course, we have got the US models of ManagedCare Organisations where clinicians enrol, but, asBarbara has intimated, British general practice, withvery few exceptions around the world, is uniquebecause of its registered population of patients. Thatmakes quite a difference—to have a holisticresponsibility that is both budgetary and clinical—andnot many countries have. There are one or two innorthern Europe, like the Dutch and so on, and NewZealand, interestingly, has only gone in the last 10years towards a registered population. So most generalpractice, as in Canada, Australia and so on, does nothave that population responsibility. So we are buildingon something which has not led so well tointernational evidence because in terms of theorganisers of general practice they are not asdeveloped as us.

Q16 Grahame Morris: Can I just ask about the sizeof commissioning units because we have had evidencegiven to the Committee about international examplesin terms of size of commissioning units, and it seemsto me that the weight of evidence in Europe andelsewhere is that commissioning units are gettinglarger rather than smaller, as we are reporting, underthese health service reforms? Is that the case?Dame Barbara Hakin: I think that it is very easy totalk about commissioning because we use one wordto describe it as one action and start to think that youcan describe the perfect world and size, and say, “Atwhat level should you commission certain services?”Commissioning is a broad series of actions. David hasdescribed the strategic overview for the population,clinical change and the technical aspects. Frankly, youneed to do those different aspects with different localsensitivities. So there are some of the particulartechnical aspects which you could very easily do at anational level and get economies of scale because thatlocal knowledge and understanding and thatconnection with patients is not relevant. For otherissues of commissioning, particularly for the moreclinical aspects and particularly for common services,you need to make your decisions on the clinicalchange at a very small and focused level. So what weare trying to build here, again as David described, isa commissioning architecture which is capable,flexible and fluid enough to do the local things locally,which are meaningful for patients, but do at a muchhigher level those things where we will save a lot of

money by doing them once, twice or however manytimes, as we work through. It is very, very different.With regard to the clinical aspect of commissioning,the referral, as David talked about, or the design of asmall pathway and data analysis, those two thingsneed to be done at completely different populationlevels. So for these consortia, one size will not workfor everything. Therefore, it is inevitable that largerconsortia will need to work on a locality model sothat they can actually get right down into that localpopulation that GPs represent, often a population evensmaller than the local authority base. So the largeconsortia will need to do that or smaller consortia willneed to work in a federated model. But there isabsolutely no question that the smaller consortia willneed to come together to commission services across,say, the geography of a local authority or thegeography of the clinical patient flows where theymight go into the local hospital. We will need to seecollaboration in the lead commissioningarrangements.So I think the answer to the question is, there is not aright size for a commissioning unit. You can’t evenhave a right size if you pick out specific diseases. Weneed to create a system where the right part ofcommissioning—the right aspect of commissioning—is done in the right size unit at the right time.Dr David Colin-Thomé: The last thing we want is tohave a mechanistic size which does not pick up thesubtlety of what we have to do to commission it all.

Q17 Chair: If we accept that thesis, then who willdetermine—to use Dame Barbara’s phrase—“the rightsize” for a given condition or a given type ofcommissioning, because there can clearly be morethan one opinion about what is the right way ofcommissioning a given service? There can also beevidence about which model works and which onedoesn’t, or which works better and which works lesswell. Who makes that decision?Dame Barbara Hakin: I think it will be acombination of decisions. The final authority forensuring that the whole commissioning architectureworks and works well sits with the NHSCommissioning Board. It will authorise the consortia.The consortia will be accountable to it. The NationalCommissioning Board will make sure that the overallcommissioning architecture in England delivers andsecures the very best services for patients, but we doneed to see a significant bottom-up approach here.Where consortia choose to do things in a federatedapproach rather than ask the board to do certainthings, or in different areas, it will be very different.It is very different commissioning services, say, in themiddle of London or in the middle of Birminghamthan it is in the outreaches of rural Lincolnshire. Forsome of these things, the actual geographical size willbe dependent on the demographics of the population.I do think that as a system, as we move forward, whatwe need to always be doing and be mindful of iswhere economies of scale save public money and, aswe move through, whilst we still have SHAs andPCTs and when the Commissioning Board comes intobeing, we ensure that on those things, in terms of




eliminating waste and in terms of the strategicdecisions that you were talking about—theoverarching strategic decisions about the shape ofservices—the board will need to keep an overview onthat and see that that is not fragmented.Chair: I think those questions about the strategicoverview and the national local balance Rosie wouldlike to follow up.

Q18 Rosie Cooper: I would indeed. The currentmodel exerts a lot of centralised power down throughstrategic health authorities and PCTs. I have to saythat in my area, without those two bodies, we certainlywould not have the improvements that we have hadover the last four years or so and I commend the chiefexecutives of both those organisations who have donesome heavy lifting, to coin a phrase. If this new modelweakens that and you have got the two fledglingCommissioning Boards, who are they going to beaccountable to?Sir David Nicholson: The Secretary of State.

Q19 Rosie Cooper: So the ultimate accountabilitystill remains with the Secretary of State?Sir David Nicholson: Yes.

Q20 Rosie Cooper: So you have got theCommissioning Board. This new model will weakenit. Can you outline for me just how the system willthen handle serious differences of opinion between,say, consortia, the regional commissioning boards andthe local population via local authorities? I will comeon to test a bit more of that in a minute. But how doyou see that actually working?Sir David Nicholson: Okay. It is a very differentsystem which is being constructed than the one wehave had in the past. That is absolutely true. I thinkyou are absolutely right. The current system hasdelivered a lot for patients and a lot for populations.The question is, in the future, could we continue towork in that way? But, also, that comes with a cost.There is a significant cost to all of the PCTs and theSHAs, and of course we need to reduce that cost aspart of the overall change in the NHS. We have totake 30% of those costs out anyway. So, if you take30% out of the cost, do you get a system that couldfunction anyway in those circumstances? I think it isunlikely that you could, just in the way that you havedescribed. But the system is quite different in thefuture.

Q21 Rosie Cooper: So the new system is designedto be cheap?Sir David Nicholson: The new system is designed tomaximise the amount of money that goes ondelivering services for patients. That is what it isdesigned to do. I am sure we will talk aboutmanagement allowances for consortia and all that andof course generally. But that is exactly what it is. Thatis part of the design of the system.In the circumstances that you describe where there aredifferences, I think there are new players on the pitch.The local authority, I think, is an increasinglyimportant player on this particular pitch. Whether we

have health and wellbeing boards, or whatever, it willhave a strategic oversight of the place in which theseorganisations function.

Q22 Rosie Cooper: Sorry, Sir David. What I thinkwe are all struggling with is this. I hear what you aresaying. When the Secretary of State was here and gaveevidence—I have been looking at it—he was clearthat the accountability in this new system would comevia local authorities, and people who were listening tohim believed or thought he was saying that the localauthority members and/or whoever would be on theCommissioning Board. That now is not true. It is onthe wellbeing board. I understand that. I have a greatfear that they will be like the current Overview andScrutiny Committees, who don’t have the capacity, thetraining, the understanding or the financial base. Soyou are not really telling me that out of nowheresomebody is going to be able to test the system as wellas the professionals you had in the PCT designing itand testing it? I just don’t buy that at all. I genuinelydon’t understand. Will there be NEDS on theconsortia? Where is the accountability here?Sir David Nicholson: The individual consortia areaccountable to the National Health ServiceCommissioning Board. It is very clear. They are notaccountable to anybody else. They account to a wholeset of other organisations and other groups. Theyaccount to a whole set of stakeholders. One of themost important in that environment is the localauthority, not just because we say it but because thelocal authority is responsible for the development ofthe Joint Needs Assessment, which is critical to all ofthis, because the Joint Needs Assessment is the basison which the individual consortia will deliver theircommissioning plan. So that connection for us is very,very important.The second one, of course, is that the local authoritywill be responsible for the delivery of the publichealth service locally and will commission the NHSdirectly for the things that it wants the NHS to do interms of public health, and that is a significant amountof resource and money wrapped up in the localauthority.If you are asking me would an Overview and ScrutinyCommittee be able to do that, I think it is unlikelythey would be able to do all of that. But that is theimportant thing about it. What we want to do throughlocal government is to make health the very importantstrategic element of their overall place plan.

Q23 Rosie Cooper: While that is all happening, youare letting rip without any real accountability. I havea real great fear. This White Paper is huge onautonomy and very, very poor on actualaccountability. Will the consortia boards be (a) opento attendance by members of the public and (b) willthere be non-executive directors on it?Sir David Nicholson: I am sure Barbara will talk alittle bit about the detail of those. What we are sayingat the moment is that the consortia will have aconstitution, in which they will set out whatever waythey want to manage themselves. We have not as yet




set out what the elements of that constitution wouldbe.

Q24 Rosie Cooper: The whole basis of this changewas set out by the Secretary of State to be based ontransparency, openness and accountability to thepublic. People will be able to make real choice and bereally involved. You have not described anything atthe core where the power is being held. You haven’tdescribed anything which shows that real people haveany real access with training and ability to challengeat the level at which it will be required.Sir David Nicholson: That is exactly what the localauthority will be doing. The local authority will havethe oversight of the commissioning process overall. Itwill have the power of the Joint Needs Assessment. Itwill have the public health budget. It will have accessto all of those things in a way it has never had before.

Q25 Rosie Cooper: If they are not at the table, it willbe currently like the Overview and ScrutinyCommittee that you see around and about the country.It is just like throwing snowballs at a moving truck. Itis not going to have any impact whatsoever.Sir David Nicholson: But in this environment thelocal authority is the table. That is the whole pointof it.

Q26 Rosie Cooper: Forgive me, but I won’t describeit. I will have sleepless nights about that rubbish. CanI just ask you a couple of questions about consortiaand the leverage they will have? I have not had anyanswers—it hasn’t escaped me—on non-execs on theboards and whether the boards will be public. Willthe consortia have leverage over constituent practices,because normally that would be held by primary carecontracts—JMS, PMS? That will be held at theconsortium National Commissioning Board level. Sohow will any leverage be exercised because if there isno set of incentives and penalties how will consortiahave any influence over constituent practices?Sir David Nicholson: Can I ask Ben to respond tothat?Ben Dyson: Sure. I think the first thing to say is that,as David says, the consortia will need to work outtheir own constitution and so their own internalworking arrangements. One of the questions asked inthe consultation on commissioning for patients is howfar the Government should set down requirementsabout the way in which they do that, and that was afairly open question in the consultation document.The proposed principle is that consortia should beheld to account for the outcomes they achieve andfor their fulfilment of statutory duties, and that theGovernment should be careful not to be tooprescriptive about the way in which that happens. Wewill probably come back to that issue.In terms of leverage over individual practices, one ofthe proposals in the consultation document was thatthere would be something called a Quality Premium,which is effectively money allocated to a consortiumto recognise, first of all, how far it is achieving goodoutcomes for patients through its commissioningactivities; secondly, how far it is managing the public

resources with which it is entrusted effectively; and,thirdly, how effectively it is meeting its other statutoryduties. The proposal in the consultation document wasthat it would be for the consortium to decide how thatsum of money is distributed between the individualpractices that make up the consortium. One of theways in which the consortium would have leverage, ifyou like, is by being able to disburse that money.I think more broadly what the proposals are seeking toachieve is a situation where there are the right intrinsicincentives for general practices to work as part of aconsortium to commission, partly because they wantto deliver better care for their patients. I think theevidence from Practice-Based Commissioning is thattoo many practices have felt that, despite some clinicalinvolvement in commissioning processes, too muchcommissioning is felt remote from them as cliniciansand what they want from this is to get greater controlin order to deliver better care for patients and alsobecause good commissioning will enable practices toredesign pathways and, in some cases, allow morework to be done outside a hospital setting.Dr David Colin-Thomé: I think one of theproblems—and I was a GP for 30-odd years—is thatone of the reasons we have had poor clinicalengagement is because the first recourse is to acontractual relationship and that immediately alienatesvirtually every clinician I know, even the good guys.If we always look at a contractual way of keeping theleverage, then we fail. One of the good examples ofgood management round the country which somePCTs have achieved is by using softer leverages, asBen has talked about, and that is a whole lot of things.You might want to use some local incentives. You usecomparative data, a bit of praise and a bit of pressure.It is those skills, I think, or the lack of them, that havealienated so many clinicians, and unless we get thoseback we will have a contractual model again whichalienates lots of people, and they do not want to play.Certainly, in fact, for some of the PBC—the Practice-Based Commissioning—things it became abureaucratic exercise rather than an evolving exercise,and unless we change that managerial mindset, whichis part of the principles of the reforms, we will getclinical disengagement. It has been clear from theBlair-Milburn times right through to Andrew Lansleythat some of our clinical outcomes are disappointinginternationally, and unless we get that better clinicalengagement, including maybe in commissioning, thenI think we will struggle to get the improvement inclinical outcomes that we need.

Q27 Rosie Cooper: How will you actually measureimprovements in outcome because, for example, notevery consortium will have the same health base fromwhich to start? If there are incentives within thesystem, how will that enable poorer areas to get somereal benefit out of a step change in health?Dame Barbara Hakin: One of the problems that wehave had for PCTs—that we have given PCTs—isexactly as you describe, in that the difference thatclinical health care makes to an individual’s health inthe reduction of inequalities and the impact of thebroader determinants of health have been conflated.




So simply by looking at the broad-based healthoutcomes that we have at the moment, it has beenquite difficult to measure and determine where theimpact is coming from and who is actually makinga difference.I think one of the things about the new suggestions,the new system, which will make it easier for us todifferentiate is to look at the different elements ofoutcomes. So what is very clear is that we will createa system whereby we look at the public healthoutcomes. We look at those issues that are largelyfrom the broader determinants of health—that budgetwill sit with local authorities and they will have thatresponsibility—but we will be able to carve out, albeitas part of one whole system, the clinical outcomes,the actual health outcomes for which the consortia andNHS Commissioning Boards will be responsiblewhere it is the difference in outcome that is dependenton the health services that they will commission.Now, they will still have a duty in discharging thosehealth outcomes to reduce inequalities and improvehealth across their populations, but for the first timewe are starting to be able to try and measure betterand have a little bit better evidence about thedifference between the broader determinants which sitas a responsibility of the public health budget and themore clinically based outcomes that are the result ofbetter and more effective clinical care.Dr David Colin-Thomé: Even if there is a differencein the demography of the population—say, theremight be more poor areas—they could measurethemselves against themselves in terms of year-on-year improvements, which we have done poorly in thepast. Some of the clinical outcomes will take sometime, but, if you look at some of the NICE QualityStandards, in them are some indicators to showprogress is going the right way, for instance.

Q28 Rosie Cooper: I totally accept that. What I amnot hearing is that you know what those things areand how you are going to do it. Disappointingly forme, I have not heard anything that makes me feelmore comfortable in terms of accountability and realpatient-centred care—patients at the very core of this.I just have not heard it because the actual power isgoing further up into boards where the ordinarymember of the public will have less and less influence,and I don’t buy for one minute that a Wellbeing Boardis actually going to exert any influence over aconsortia grouping which will, in all probability, meetin private and may or may not have non-execs on it.I have not heard one noise from any of the panel totell me I am wrong.Dame Barbara Hakin: I think there are two questionsin that, or two comments. Firstly, we are doing a lotof work on the outcomes and exactly how we willdefine much more specific outcomes, both clinical andhealth based, that will be ready for the consortia whenthey come into being. I can assure you that work isgoing on. It is very focused and, in terms of theclinical outcomes, NICE are involved in a lot of areas,but we have a lot of outcome measures for the majordisease areas which will come in.

In terms of the accountability and the public, Isuppose a bit depends on whether you really seeaccountability and responsibility to patients and thepublic as being discharged simply through a board.You are right, and Ben made it very clear, that for themoment the consortia will have to have a constitution.They will have to be authorised. They will have tomeet the principles of good governance. For theirauthorisation, they will have to demonstrate how theyare properly accountable and how they are properlyinvolving people in shaping their opinion, which aretwo different things.I do think that there are many other ways that we caninvolve patients and the public much, much more inwhat we do, in how we make decisions about healthand in how we understand what they want than a smallnumber of non-executives sitting on a board, and thatis something that we will clearly have to buildthrough HealthWatch.

Q29 Rosie Cooper: Dame Barbara, if you reallybelieve that you should get rid of all the non-execson every hospital board in the country because theychallenge the managers and they challenge the system.There has to be built-in challenge. You can’t just goabout doing as you wish.Dame Barbara Hakin: That is right. There are thetwo areas. There is the challenge—theaccountability—and the constitution for the consortiawill say they will have to demonstrate thatgovernance, but we haven’t been prescriptive how ithappens. But equally important is that broader basedunderstanding of patients’ opinion.Rosie Cooper: Let me tell you—I really will stopnow, and I am very grateful to the Chair for hisforbearance—in Lancashire county council they justdid a consultation and 1.5% of the populationsupported the item that they were consulting on. Theydid it anyway, and that is what I am hearing here.

Q30 Fiona Mactaggart: Just taking the point thatyou were making, Dame Barbara, the power of theindividual patient is, I think, what I was hearing about.I have heard from the Secretary of State the saying,“No decision about me without me.” We know, and itis referred to in the White Paper, that there are risksassociated with people from different populationgroups being better or less good at exercising thatchoice. I do not see any mechanism within thisstructure which provides for those population groupswhich are least effective at exercising choice andholding clinicians to account. I am not sure I believein this bringing back of clinical success—intrinsicrewards for doctors. When you are faced with ill,ignorant people who do not want to make decisionsabout their health, they want you to fix it. I do not seehow this helps with that at all.Dr David Colin-Thomé: Two things. One of thespecific dynamics, I suppose, is the focus we havemade on patient-reported outcomes so that cliniciansare going to have to be held far more to account. Westarted that off in the previous Government in a verysmall way, and I think Mr Lansley is very keen forthe outcomes framework to carry that further. I take




Rosie Cooper’s point about the broader issues ofaccountability, but that specifically does change thedynamic of the outcome measures for clinicians. Itmakes quite a difference. For instance, it is interesting,just because it is relevant to me, that when we didsome of the work, we found that 20% of people whohave had a knee operation for arthritis have felt nobenefit from it. That can be used in a very much morepositive way of having a proper engagement.However ignorant or whatever, people will come toclinicians. So patient-reported outcome measures is aspecific area I think we have not spent enough timeon, which is a healthcare issue. I take your generalpoint about broader accountability, but, unless localgovernment also changes their way of doing things,and I speak as having some experience of localgovernment, their leadership on the Joint NeedsAssessment is crucial for those groups that are belowthe radar screen. In fact I was involved with Ben onsome work about social inclusion at the Department—which, I think, the Minister accepted—which foundthat some groups are so far below the radar screen thateven a Joint Needs Assessment doesn’t pick them up.Public Health Directors, working with localgovernment colleagues and consortia, need to becharged as the ones who have responsibility. So, inone sense, rather than saying, “It is under the healthcare system”, it is an issue about change of localgovernment. You were talking before about theOverview and Scrutiny Committee, and in one sensethat may be a relevant, useful beating-up, but I wouldlike local government to be part of the answer hererather than always just trying to check on what healthcare is doing, and that is what the whole point of thesechanges will bring about.

Q31 Rosie Cooper: Part of the question that I wasasking is, what are you going to do to enable them todo that? You are asking them, from a standing start,to be able to examine commissioning, to representtheir areas and to examine commissioning at the levelat which—Dr David Colin-Thomé: No, I am asking them to doa proper needs assessment that picks up thoserelevant things.

Q32 Fiona Mactaggart: Then let’s be clear. Localgovernment is good at doing needs assessment ofthings which it pays for, and it does it quite well andit commissions, on the whole, more effectively than alot of commissioning that operates within the NHS. Itcommissions rubbish collection services which reachdown difficult alleys. You know, it is quite goodcommissioning, but you are not giving it the power tocommission—not even maternity services, which arenot going to be done on a medical model, which seemto me perhaps a logical thing to give. They are notactually doing the commissioning. They are not usingthe resources or the professional officers they have tocommission. They are just doing some jolly littlereport that other people commission against. That iswhat it looks like.Dr David Colin-Thomé: But they do have the PublicHealth Director, who will be in local government, and

with his/her connection with health care as well andthe part of health care that can contribute to thepublic’s health. That makes it a much more completepicture.

Q33 Fiona Mactaggart: I like that bit of this paper.I think it is probably the only bit of this paper that Ilike. But you know and I know that what that PublicHealth Director will mostly be doing is things likedealing with poor housing contributing to ill health,and dealing with the bits of local authority provisionthat improve physical activity amongst children orimprove the diet in schools. Those are the kinds ofthings that I think their biggest obsession will beabout, and indeed they will improve the health of thepopulation. So I am not diminishing that.One of the things that I managed to do shortly after Iwas first elected was to get Slough to know that atthat time we were among the top 10 towns in thecountry for early male deaths from heart disease.Giving citizens that knowledge helped them and thelocal authority to focus energy and helped a numberof people to do things which means that we are notany more, but they are not going to be procuringcardiology services. You know that and I know that,and that is part of the equation.Dr David Colin-Thomé: They will be advising. Butthey are taking, as it were, some of the health servicemoney. Public health doctors come from the healthservice, as well, because in 1974 they werecorporatised, weren’t they, into the health service,whereas before that they were not. One of theirresponsibilities is not necessarily to do all the workthemselves, but to engage clinicians to look at someof the needs assessments and why we areunderperforming in clinical care too. They will havean important overall responsibility which is now inlocal government.

Q34 Rosie Cooper: But they won’t be at the table.They won’t be influencing commissioning, which isthe whole point.Dr David Colin-Thomé: If they have the skills, theywill be.Chair: I think we have probably covered the point.

Q35 Fiona Mactaggart: There is an issue here aboutpower, and I think my anxiety about the White Paperis that it assumes that power exists without givingpeople the equipment which enables them to bepowerful. I am particularly concerned about thisbecause I represent patients who disempowerthemselves, whose view is that it is the doctor’sproblem when they are ill, not theirs, and who findtaking responsibility for their own wellbeing veryhard.I think this is a model which is designed—I think itis interesting talking about intrinsic rewards—oneveryone behaving like the best and using all thepower that is available for them. For those people, thismodel will succeed. The analytical strategy documentthat came with the White Paper specifically said thatthe patient choice inherent in this poses risksassociated with people from different population




groups benefiting disproportionately, and I do not seeany mechanism which deals with the risks of that inthe White Paper. I do not see any mechanism whichcan improve the quality of primary care. I don’t seehow a central board is going to be able to do that. Ithink there is a lot of wishful thinking, and, if all thewishful thinking works, this could perhaps be, butactually it won’t. I don’t see where the risk avoidanceis in this White Paper.Sir David Nicholson: There were a thousand and onethings in all of that, some of which we agree with andsome we don’t.

Q36 Fiona Mactaggart: Yes. I made a speech,forgive me.Sir David Nicholson: When it comes to criticalpeople who are engaged and working in the detail ofhow this is going to work, we are not there yet. Wehave not even responded directly to the consultationon the document. So criticising us for the absolutedetail of how some of this stuff will work, I think, isa bit unfair, but nevertheless I think there are goodmarkers in all of that.What is very clear is, if you want to focus onoutcomes, which is what the Commissioning Board isthere to do and what the consortia are there to deliver,you have to take into account how you reach thosepeople that it has traditionally been difficult for theNHS to reach. You have to do it. As the kind ofultimate localists here, GPs are very well equipped todo that because they are absolutely involved in allof that.

Q37 Fiona Mactaggart: My constituents go to A&Efor their GP services.Dr David Colin-Thomé: Only some.Fiona Mactaggart: They do—quite a lot.Sir David Nicholson: Some of them do, but they willnot get their best outcomes if they go to A&E and, ifthe consortia continue to let that exist, they will notget the best outcomes for their patients. So they needto think about redesigning their service to deliver it. Ithink the potential in that is fantastic for our patientsand it can be done. If you add to that the central stageof local government with the Joint Needs Assessment,I think you have got the building blocks there whereyou could improve significantly the lot of thosepeople.

Q38 Rosie Cooper: How are disputes handled, andI really will shut up? How are disputes going to behandled—differences of opinion at each of thosestages?Sir David Nicholson: Between?Rosie Cooper: The consortia and local population,Wellbeing Board, regional—Fiona Mactaggart: Let me give you a specificexample from Berkshire. The Berkshire Mental HealthTrust wants to move inpatient mental health care to ahospital the other side of Reading, and Slough hasthe highest incidence of mental ill health. Nobody inSlough wants this proposal; they want to retainsomething more local, but they will end up with thisproposal because it is cheaper. They will risk also

ending up without any improvement in communitymental health service which would reduce inpatientadmissions. Where is the power in this future systemto stop things like that happening?Sir David Nicholson: Obviously I do not want tocomment on the way you have described the issue inBerkshire. I have to say, one thing about mental healthinpatients is, of course, that the biggest determinantof the incidence of mental health in a community isthe existence of an inpatient mental healthorganisation. So an issue about whether everyoneshould have one is, I think, important in terms of themental health of the population. But, that aside, if youlook at the arrangements that we propose, which arenot that dissimilar to the arrangements that we haveat the moment, and we have not worked out all thedetail of that, we would expect the Health andWellbeing Board to be a crucial part where that debateand discussion is played out, and we certainlywouldn’t see the local authority having any less powerto refer that to the Independent Review Panel or theSecretary of State than they have at the moment.

Q39 Fiona Mactaggart: Would that local authority,for example, have the power to say, “We want tocommission the community interventions, whichwould reduce the incidence”, because I don’t disagreewith you completely? My view is that I could consentto this change only if we improved community mentalhealthcare. It is bad at the moment in Slough. If it washugely better, I would be much less worried aboutthis proposal.Dr David Colin-Thomé: GPs are more likely to wantthat because we feel often very unsupported within acommunity base. When you have the complexproblems of the vulnerable, the mentally ill withproblems, general practice generally is quite isolatedfrom the connection with mental health services, andso they would be advocates for improvement. It isinteresting that all the major GP organisations supportthis. One of their key tasks that they specify is, “Wewant to improve primary and community services.”That was their main focus.

Q40 Fiona Mactaggart: Quite a lot of GPs I knowwould quite like their floridly mentally ill patients tobe somewhere else.Dr David Colin-Thomé: The floridly ill might needto be somewhere else at the acute exacerbation. It istrying to see whether we can have a more pro-activeapproach to lessen some of those, and I have beeninvolved in some of that work when I was a GP, whichlessened emergency admissions and lengths of staybecause we had a more pro-active approach in thecommunity. That is what we need to becommissioning for and I think more clinicians will beup for that than may be at the moment.

Q41 Chair: Can I move the discussion on a bit? It isquite striking to me that, with regard to the discussionwe have just had about the importance of having localsolutions, and the ability to channel resources locallyand target prioritised resources locally, that is all beingsaid and it is a familiar narrative, but at the same time,




as I read the White Paper, contracting for primarygeneral medical services, primary care, that authorityis being shifted away from the locality back to thecentre in the form of the Commissioning Board. So Iwould be interested to know whether that is a correctreading of the White Paper, and whether that is aclear decision.There is a related subject, which is that one of theeffects of Commissioning Boards where existinggeneral practitioners are, by definition, the membersis that, if for a locality current primary care issubstandard—typically in some of the areas that Fionaand Rosie have been talking about it will besubstandard—one of the problems, it seems to me, isthat people who might have an idea about how youcould improve that have first to get past the peoplewho are currently providing the substandard care.Dame Barbara Hakin: I think it is a difficult dilemmaabout the commissioning of primary care and I thinkthat, if the White Paper had said that primary care wasto be commissioned by the consortia, we would havebeen sitting here this morning with you perhapssuggesting that there was a conflict of interest and wasthis not GPs commissioning services fromthemselves? So there is no doubt that from the probitypoint of view it is right that the NHS CommissioningBoard oversees the commissioning of primary careand has the absolute authority for that as a quiteseparate body.Nonetheless, what you say is absolutely right. If weare to get the improvement and the changes we wantto see in primary care—everybody in this room andeverything we are talking about is people saying theywant to see much better services in primary care,much better community-based services that meansthat patients do not have to go to hospital—we knowfrom the evidence base that you need a very localflavour. We also know from the evidence base thatpeer pressure is much more successful at changingclinical practice, changing behaviour and improvingquality than top-down managerial suggestions forchange. Therefore, we are at the moment workingthrough—we are in the early stages; we have not gotall the detail, and I will pass over to Ben to see if hewants to add anything to the detail—question such as,how do we achieve a situation where there is a degreeof earned autonomy? How do we have a situationwhere the NHS Commissioning Boards and theconsortia work together to commission primary careso that the consortia can have a real impact throughpeer pressure on bringing up those practices which arenot very good?It is easy to get fixed on a relatively small number ofpractices which provide poor care and forget about thevery high standards and the very high percentage ofsatisfaction that patients have in this country aboutgeneral practice. But I think the people who want totake on this change, some of the practitioners, the oneswho want to leave this consortia, are saying to us,“Please, what we need more than anything else is theability to have leverage and authority over our peers.”Like David, I was a GP for 20-odd years, and thebiggest changes that I think were made to the quality

of care across an area—I was a GP in deprived inner-city Bradford—was when there was a movement ofthe responsibility for improving that care from amanagerial focus to a clinically peer-led focus. I thinkwe could cite lots and lots of examples whereby in agroup of GPs the good will lead the poor ones. Thegood will be more able to root out and challenge poorpractice than a managerially focused organisationwould be. Ben, I don’t know if you want to addanything.Ben Dyson: I would certainly reinforce that. If youlook at some of the more advanced versions ofPractice-Based Commissioning, there was a greatersense that PCTs really were letting go more inallowing GPs and other clinicians to make the rightdecisions about the quality of care for their patients.I think what we saw in those examples was, of course,precisely this stronger focus on using peer influenceand peer pressure to look not just outwards at the careone is commissioning for patients but also inwards atthe quality of general practice itself and the way inwhich resources are used.The consultation document on Commissioning forPatients said, as Barbara says, that although theCommissioning Board would have to have the finalsay, for instance, on who should hold a contract forproviding primary medical services, if there are issuesabout poor performance, they would have to make thefinal decisions about how to tackle that. But, theconsultation document proposed that they would beable to involve consortia in reviewing how effectivelyindividual practices are providing primary care andbuild on, I think, the greater peer influence thatleading GPs want to have on the quality of generalpractice.

Q42 Dr Wollaston: Does that not bring us to the nubof this? Would it not be better to look at where itworks well, because there are some models where itworks very well, and develop that rather than take thebig risk of the complete upheaval that we are going tohave under the White Paper?Ben Dyson: I think I would say that, if one looks atthe evidence, I talked about some successful PBCgroups that were beginning to do this, but I am afraidthey were rather in a minority. What GPs were tendingto say in the majority of cases was that PCTs were notletting go.

Q43 Dr Wollaston: Could you not just make themlet go? Could you not say, “Where is this happeningthat they are letting go?” Could we not force PCTs tolet go on much more clinical leadership, because thatis what we are hearing? It is not just doctors: it isclinicians—all clinicians.Dr David Colin-Thomé: We have tried that but wecouldn’t do it.

Q44 Dr Wollaston: Couldn’t you push it to say,“Why isn’t it happening? Why can’t we force thatthrough?”Ben Dyson: I think the effect of letting go would beto create what is proposed in the White Paper, whichis commissioning that is led by general practice and




other clinicians. It does not in any way preclude themfrom using them. They would clearly have to usemanagers. They might well use some managers fromthe existing system to do those elements ofcommissioning that do not particularly need theirclinical insight, but it is them in charge rather than, Ithink, what a number of GPs and PCT managerswould say was the muddle of Practice-BasedCommissioning—this rather uneasy halfway house.

Q45 Rosie Cooper: You would have avoided thatmuddle in foundation hospitals by doing it in phases.To press the point Sarah was making, why aren’t youdoing it, if you like, in phases, doing it in pilots andlearning from it? Why just throw everybody, good andbad, into this melée?Dame Barbara Hakin: I think it will be phased.David has already talked about the timing for this—that we have got a number of years to make thischange. What is going to happen, what we are goingto see, is some areas moving ahead with the consortiaas Practice-Based Commissioning consortia, as theyare now, moving forward under those rules andregulations as we have now to become much morelike the GP consortia for the future.

Q46 Rosie Cooper: You do not have time to learnfrom the good ones really. It’s so fast.Dame Barbara Hakin: We have learnt a huge amountfrom what has gone on over the last decade andcertainly what has happened with Practiced-BasedCommissioning over the last few years, and the oneswho are advanced are ready to roll now.

Q47 Valerie Vaz: Sorry, can I just ask whatpercentage of GPs actually want the commissioningso far? Do you have a figure?Dr David Colin-Thomé: It is hard to say. If you lookat the GP organisations who might have a vestedinterest, they say that it is a significant majority oftheir members. The only thing that was done recentlywas the poll on the BBC, which was an online poll of827 GPs, which is hardly representative, and about25% wanted to be actively involved incommissioning; 18% said they did not know.Basically, even if you had 25%, that would be 9,000GPs that seemed to be up for it, if we extrapolate that,and 18% were “don’t knows”. They weren’t all“antis”.Ben Dyson: I think the important thing about thatBBC poll was the question they asked was, “Do youwant to be personally responsible forcommissioning?” Not, “Do you want to be part of acollective group, a consortium, that does this? Do youwant to be personally responsible?” And over 25%said, “Yes”.

Q48 Chair: Can I just bring you back to the questionI asked five minutes ago? Am I correct in thinkingthat the consequence of the answer that Dame Barbaragave is that we are moving back to a single nationalcontract negotiated for general medical servicesbetween the Department and the professions?

Dame Barbara Hakin: We have a number ofcontracts at the moment, but the bulk of that is a singlenegotiated contract between the Department and theprofessions, which is GMS. There is the possibility forlocal contracts, which are personal medical servicescontracts, but across the country there are very, veryfew that significantly differ from what is negotiatednationally—they just follow the pattern nationally. Aswell as that, we have a range of other contracts withindependent providers.The contract, instead of being negotiated by theDepartment of Health, will be negotiated through theNHS Commissioning Board, but in reality the contractis one part of getting good general practice. It is onepart of commissioning. It is contracting back to mypoint about breaking down commissioning into itsvarious parts. We need to continue to make thatcontract better, to make it more focused and to makesure that it delivers outcomes, but it is so importanthow that contract is monitored and played out on thespecific commissioning that goes round it on a localbasis. Again, I think, our aspiration is that theconsortia will be better placed to do that than the PCTshave been.

Q49 Chair: I understand all the qualifications, butthe direction of travel is towards a single formula forthe delivery of primary medical services?Ben Dyson: Indeed, the White Paper certainlysignalled that the intention over time was to movetowards a single model.

Q50 Chair: If somebody wants to offer primaryhealth care on a different model, the answer is that theNHS is not interested?Dame Barbara Hakin: A single contract would notmean that individuals could not offer differentelements of care and that there is not a broad range ofthings that you can do in addition to the contract.Public health services may wish to commission fromprimary care providers, general practitioners andothers, and some of those elements will be different.But actually we are moving to uniformity overcontracting across the board in the health service forthe simple reason that we have had a plethora of localcontracts which has created an enormous amount ofwaste and has not always given us the qualityoutcomes that we want to focus on. So the idea is todescribe a single core contract, both for primary careand a lot of elements of secondary care, whichabsolutely make it clear nationally what we expectfrom our national health service—the outcomes weexpect for our patients.There is nothing to stop any commissioner andprovider putting additional things in or agreeing theway in which some of these outcomes will bedelivered. So it is about uniformity andstandardisation of what our patients should expect, butthen trying to give everybody as much flexibility todeliver that as it takes to meet the local needs.

Q51 Mr Sharma: So they can adapt locally whatsuits the providers?




Dame Barbara Hakin: Provided it fits within thenational framework, which simply identifies thebasics, the outcomes, what is expected and whatpeople will be paid for. There is no questionwhatsoever that there will be plenty of room foradditional services to be commissioned if those arewhat is needed at a local level, as there is at themoment.

Q52 Chair: Sorry, just finally, that national contract,as far as GMS is concerned, will be negotiated withthe BMA?Dame Barbara Hakin: It will.

Q53 Grahame Morris: Are other Departmentssupporting this concept of the Any Willing Providermodel? When you mentioned the contractual modelfor performance management of GPs, there areconcerns that the Any Willing Provider model forgeneral practice could cause problems if short-termcompetitive tendering situations will develop.Dame Barbara Hakin: The policy is for Any WillingProvider to work across all health services. Wealready have a number of areas. This particularlyworks in the deprived areas where it is actually quitedifficult to deliver traditional general practice. It isactually quite difficult to attract general practitionersto become self-employed in those areas and that iswhy we have got what is called the APMS, thecontract, independently. I do not see that as being verydifferent than it is now. The philosophy is that weneed to encourage other providers becausecompetition drives up quality, and particularlyencourage different ways of addressing theinequalities that come from poor primary care in ourdeprived areas. I am not sure I have answered yourquestion there.

Q54 Grahame Morris: I am not sure whether theDepartment’s move towards the Any Willing Providermodel is to supplement existing services or to identifythose areas of deficiency, perhaps in a deprived arealike mine. I am not quite clear from your responsethere.Dame Barbara Hakin: I think it is “both and”, to behonest, and one of the issues that we believe willmake a difference is a single contract. At the momentwe have a different contract, depending on who isproviding the service, and this sometimes makes itmore difficult (a) for money to follow the patient and(b) for the quality standards to be quite as clearlydefined. We believe we would get higher standards ofprimary care if we had a more consistent approachirrespective of who the provider was and in that waypotentially encourage, particularly in deprived areas,an opening up of the market.

Q55 Chris Skidmore: Dame Barbara, I waswondering if it might be possible to move thediscussion on to access of information which you haveset out in the Department’s written evidence isessential to inform decision making regardingcommissioning. You mention in the written evidencealso that, “Devolving power, along with real budgets,

the consortia of GP practices would mean the qualityof management data and financial information willbecome of increasing importance.” At the last HealthSelect Committee inquiry on Commissioning, theprevious Committee was fairly critical about theDepartment failing to provide any clear and consistentdata on the transaction costs of commissioning. Thatwas a case where we had 152 PCTs. Can we be surethat moving from what we had to the 500-plusconsortia we are going to have the financialtransparency that enables us to identify the transactioncosts of commissioning?Dame Barbara Hakin: First, I think we should notnecessarily assume that there will be 500-plusconsortia. That is still to be determined, and I thinkwe would all absolutely and completely agree that,irrespective of the shape of the commissioningarchitecture, information for both commissioning andfor patients is key to delivering a much better service,and we are very much focusing on how we get aninformation revolution which helps bothcommissioners and patients.I think, with the new system, one of the things thatwe want to see, and I know I am saying what I havesaid before, is that things that can be done locally aredone locally and those that can be done nationally aredone nationally, so that we get economies of scale,which is a different approach from 152 PCTs doingmost things.

Q56 Chris Skidmore: I appreciate the divisionbetween local and national. One of the crucial nationalframeworks set out in the White Paper is obviouslythe maximum management allowance, which SirDavid mentioned earlier. I know the “Health ServiceJournal” of 22 July 2010 mentioned that speculationmanagement budgets might be as low as £9 perperson. Is that a figure you recognise or would therebe alternative MMAs, let us call them, for differentlocal areas which then might reflect different localscenarios?Sir David Nicholson: One thing I know theCommittee was critical of before was the lack of datain terms of the financial underpinning of a lot of theexisting commissioning arrangements, and in someways that point was well made. One of the things, Ithink, that focusing our attention on the financialposition of the NHS overall has done, of course, isthat it has made us focus much harder on the cost ofoverheads generally in the system. We had over sometime devolved a lot of responsibility for that kind ofthing.One of the things we have done, certainly over thelast 18 months or so, is to focus very hard on all ofthat and, in order in a sense to identify the amount ofmoney you have available to support commissioningof consortia, you also have to identify the moneyavailable for the administrative costs of the publichealth service, of the Commissioning Board, of theeconomic regulator, of the whole system, and that isessentially what we have been working on over thelast period.We propose to finish that work in December when wepublish the operating framework of the NHS. We will




set out what the management allowances for thepublic health service, the economic regulator, theCommissioning Board and the consortia are at thattime.I have to say that it is significantly less than 5% acrossthe system as a whole and we are moving to asituation where we would expect, certainly forconsortia, to have a cost per head of population, andwe would set that out in December.Chris Skidmore: So the 5% figure is nationallyacross the board? Sir David Nicholson: Yes.

Q57 Chris Skidmore: So the 5% figure is national,across the board?Sir David Nicholson: Yes.

Q58 Chris Skidmore: The previous SelectCommittee identified on unpublished research that wewere previously around 14%. So, it is a sort of 9%cut nationally—Sir David Nicholson: No. There was a whole seriesof information in the public domain. It certainly wasnot the Department’s figure of 14%.

Q59 Chris Skidmore: Do you have a figure? Doesone exist?Sir David Nicholson: We are moving towards gettinga figure for the totality of the administrative costs ofthe whole system, and that is what we are trying tobreak apart at the moment. We have not finalised thosecalculations. What I can say is it is significantly lessthan 5%, but even on all of that we plan to reduce thatover the next three years by 30% anyway as part ofour plan. So we will publish those figures and we aregoing to go for a cost per head of population for GPconsortia. I can’t comment on that. I do not want tonegotiate on the number.

Q60 Chris Skidmore: You can’t comment on that.Still on information, we have covered financialinformation and accountability. The other crucial partis also clinical information and health care outcomes,and you mentioned in your written evidence that youwill work with the profession and the wider NHS toidentify how best to support consortia in thesignificant challenge of accessing accurate and real-time data. I just wondered if you could just commenton that because at the same time it is going to taketwo to identify that data. You have spoken at lengthabout the role of the local authorities, and it isobviously going to be a bit of a jigsaw placing thesedifferent roles together. In different areas withdifferent clinical needs there are going to besignificant discrepancies. Yet at the same time in yourwritten evidence you talk about not proposing to beprescriptive, about the exact organisation andGovernment’s arrangements of the commissioningconsortia, and it seems quite woolly the way you saythat consortia might choose to act collectively. Theymight choose to buy in expertise and support. It might,for instance, include analytical activity to profile andstratify health care needs. With that being soconditional, how can we ensure that we are going toget uniform analytical data that will be accurate and

that we can make clinical decisions andcommissioning decisions maybe at the NationalCommissioning Board?Sir David Nicholson: The first thing is that, in termsof standardising of data, the standardisation of thedefinitions of data, all of that sort of thing, will bedone by the Commissioning Board and theInformation Centre. The Information Centre will bethe main hub into which the national information, allinformation, will go and from where information willbe drawn, which is different from where we are at themoment. It seems to me that is an important firstthing.What we have not made the judgment on yet is wherewe are going to go, and I think we discussed this alittle bit at the last meeting, on how much freedomindividual consortia will have. So, for example, whatwe are saying across the arm’s-length bodies in theDepartment is that we will do all of their back officework in one place. We will have one systematic wayof doing it. We will not allow every singleorganisation to create their own back office in orderto deliver change, and we have not quite got to thediscussion point yet with the consortia about how thatmight work. What we want to avoid is everyconsortium inventing its own system.

Q61 Chris Skidmore: Can you define “back officework”? What would that mean?Sir David Nicholson: I am thinking about thefinancial accounts, the way financial information iscollected, the data definitions of all of that, the way inwhich invoices are paid, all of that; the HRarrangements; and bringing people in on contracts. Allof those sorts of things are what I would describe as“back office”, and increasingly we want to move theNHS to very much simplified arrangements for that,but we have not got to the point of working out howwe are going to deal with the consortia. Given theamount of money we are going to give them, andgiven that we have reduced the administrative costsby a third, I think most of them are going to have tolook towards bigger units to support theirorganisations.Dame Barbara Hakin: I think there are two kinds ofback office functions, although there is a second kindparticularly for commissioning, because there is whatwe have always traditionally known as back officefunctions which are all part of the health service andmost industries, such as HR and the financial issues.But what we are hoping to see with the consortia, andwhat we are working through, having discussions onand trying to support them in doing, is doing the samewith some of what we would call the commissioningsupport functions. Again, there is a broad range ofthings on commissioning which you would not expectindividual consortia to all want to do for themselves.So, that would include areas such as health needsassessment and quite a lot of the public health inputas well as some of the transactions that Sir Davidtalked about. Again, we are working—we will beworking—with the consortia to try to ensure that weget the economies of scale on commissioning supportas well as the absolutely traditional back office.




Q62 Chris Skidmore: How will local authoritiesdovetail within that, as you have just mentioned,public health, for instance? It is one of those thingsthat, at the moment, with so many bodies or playerson the pitch, as you have referred to, who is going tobe refereeing all this? You have mentioned that, forinstance, consortia will need to ensure they haveaccess to draw upon the necessary expertise of thoseworking in health and social care, and yet we knowwhat the integration of health and social care is. Is itone of the things that is vitally lacking in the currentsystem?Dame Barbara Hakin: This is a devolved system—there is no question about it—but the consortia willhave to demonstrate as part of their authorisationprocess and the constitution that they are capable ofdoing the full range of functions that they need to do.We are working with them on getting a very cleardescription of all the things that need to be done,obviously subject to consultation and subject to thechanges that David mentioned at the beginning. Sothey will need to demonstrate that they can do allthose things.

Q63 Chris Skidmore: Demonstrate to theCommissioning Board?Dame Barbara Hakin: To the Commissioning Boardin order to be authorised. I suspect that, withoutsignificant economies of scale and sharing offunctions, particularly working with local authoritiesand buying quite a lot of commissioning support fromthe bigger local authorities, they would not be able todemonstrate that full range. So that will be the way inwhich sharing is encouraged, although, again, fromtalking to consortia, that is what they expect to doanyway. I think they are expecting to have some quitebig units supporting them on some of the moretechnical aspects of commissioning, considerablybigger potentially than PCTs, and the use ofspecialists, making sure that where necessary theydraw in specialist information when they arecommissioning more specialist services. So I am notjust talking the absolute importance of involving thelocal consultants and other clinicians, but we areseeing some interesting models for commissioningsupport. For example, the neurological conditionssocieties have come together and suggested that theycould provide really good commissioning support to ahuge range of consortia because they would actuallybe able to really help to describe and do some of thecommissioning support functions, and they arewanting to be part of the commissioning supportsystem. We are in the early days of going through thethinking, but that kind of model gives us the potentialto get much more focus.

Q64 Chris Skidmore: Like alternative strategichealth authorities?Dame Barbara Hakin: A consultant neurologicalvoluntary sector would not be like a strategic healthauthority. SHAs do a huge range of things. There maybe some commissioning support functions that wouldbe best done on the geography of a region, but thatbody would not look at all like a strategic health

authority. It would be an independent unit from whichthe consortia drew their commissioning support. Soit is much more likely to be like a kind of businesssupport unit.Chair: David Tredinnick would like to ask somequestions about patient choice.

Q65 David Tredinnick: Chairman, if I may. TheWhite Paper promises choice of treatment and, if Imay start by saying, I think the Department supportfor the right of consumers to exercise their choice oftreatment was showing in its response to the ScienceCommittee Report of the last Parliament onhomeopathy. Your report clearly supports the use ofhomoeopathy, as there always has been in the healthservice. So I do not want to dwell on that, but whetherdoctors themselves, as individuals, are supportive ofhomeopathy or not, there is a broader issue, and thatis, are GPs capable of allocating and rationingresources appropriately and effectively, when there aretensions between the wants of an individual and thegeneral need? So can they ration resources in this newera of choice?Dr David Colin-Thomé: I think, before we go torationing—I have said this to people before—I usedto belong to a thing called the Anti-Rationing Group.We define rationing as a delay or denial of appropriateand effective interventions. Since a lot of what we didwas neither appropriate nor effective, that is the placeto start. There is a lot of duplication. There is a lot ofeven clinical interventions which now have a limitedshelf life, and also better care is cheaper.Before we start saying we are going to cut systemsand, things that work, there is a lot to play for andclinicians are up for it. All the preparation thatBarbara has talked about—fundholding, totalpurchasing and all that stuff—a lot of us have gotquite a bit of experience in this. So I think what wewould be doing is challenging the clinical organisationof care, and there is a lot. Just as an example, and Ido not want to be too precise, there are 31.5 millionfollow-up outpatients a year and many of those peopleare seeing their GPs too. We just need to systematisesomehow. There is a huge variation of lengths of stayand GP referrals.Clinicians, now they have got commissioningresponsibility, will want to challenge a lot of thoseclinical activities, and that is the shorter term hit thatwe will make rather than rationing things that work,and, I think, there is too much thinking that anythingwe say we should not do in future is labelledrationing, when actually it is getting rid of stuff that isduplicative or ineffective. That is where we will start.

Q66 David Tredinnick: So it is more to do with amore rational use of resources rather than rationing?Dr David Colin-Thomé: Yes.

Q67 David Tredinnick: So did your thoughts andyour experience lead to the idea that there should bepersonal health budgets, including direct payments,and these are being piloted? I would like to knowwhether you are intending to extend that to avoucher system.




Dame Barbara Hakin: It is quite early days in termsof piloting personal budgets and there is a lot oflearning to come from that and it is a small cohortof patients. We are looking at specific instances andobviously working—

Q68 David Tredinnick: I think it is very helpful tosay, “It is under consideration. It is something that isdefinitely there.Dame Barbara Hakin: Yes.

Q69 David Tredinnick: With the idea thatindividuals could make a personal contribution toincrease that little pot whether it is transportable ornot?Sir David Nicholson: No, no. Much of the lessonslearnt on the benefits of personal budgets has comefrom local government who have made huge stridesand we can all think of inspirational examples of howthey have changed life chances and lives of people todo that.The NHS is different because we do not have ameans-tested element to our activities. We are free atthe point of use as far as individual patients areconcerned. As we go through the piloting stage wherethis is being exposed, obviously, as you might expect,the position we have taken very firmly on all of thisis that in terms of health personal budgets they willbe based on an assessment of need and that that needshould be delivered by the NHS free to thatindividual.

Q70 David Tredinnick: So is the amount then afunction of a doctor’s decision?Sir David Nicholson: It might be a multi-disciplinaryteam, but it would be a clinical decision about whatthat individual’s needs are and how they might be metin consultation with that individual. If the individualwants to buy more than that—i.e. more than theirassessed elements of needs—that is a matter for theindividual. You would have to separate that out fromthe package that was delivered, and that is thedilemma. That is why we are piloting it. That is whyit is so difficult.

Q71 David Tredinnick: I have only got two furtherquestions and then I will stop. If a patient comes tothe doctor and says, “Right, choice of treatment: Iknow what I need. I know what I want and I’ve got apreference, and it’s based on anecdotal evidence offamily experience”, what guidance are you going togive to GPs as to the decision-making process in asituation like that?Sir David Nicholson: It is about personal budgets orabout things generally.

Q72 David Tredinnick: I really want to get on to arange of services. Perhaps I should amalgamate mytwo questions. If we are going to have wider choice,we need more availability of treatments. I’ve alreadyreferred in the last meeting we had to the importanceof diet and the importance of taking personalresponsibility for your own health. In fact I wastalking to somebody at the weekend who had just had

a heart condition treated and I said, “I am sure youwill be quite interested in your inputs, your foodconsumption”, and he said, “Oh, no, I’m not at all.My doctor is treating me. He’s given me drugs.” Ithought, “Well, we clearly have got a lot of educationto do out there.” But, if we are going to have morechoice, we need a wider range. Osteopathy is very,very effective in treating back pain, and that has beenpartly available. There are big issues about, forexample, the use of Ayurvedic medicine in the healthservice. We have the issue with the Traditional HerbalMedicines Directive which has to be complied withby April next year. It has been at the Department forsix years. There have been endless consultations. LordChan and Michael Pitillo have been coming forwardwith recommendations for the Health ProfessionsCouncil to take that forward, and indeed that wholerange of services will be excluded if something is notdone, and there is the registration of the herbs too.There is a major issue of compounds. Very, very fewhave come forward for registrations and we end upwith not just a health issue but an economic issue aswell-known companies are shut down because of thisissue.So I am suggesting to you that (a) if we are going tohave wider choice, we need actually to have thechoice, have the availability there, and the Departmentneeds to look at these with more care and give morethought and more pressure to those issues of thisparticular area of herbal medicine.Sir David Nicholson: Fortunately, we have twodoctors here.Dame Barbara Hakin: I think what you describeabout working with a patient to decide what is thebest treatment for that patient is what GPs do all day,every day, and the good ones do it very much inconsultation with the patients. The good GPs havealways given their patients choice, not just choice ofwhere to go for a secondary care treatment but, “Thisis how physiotherapy might help you. This is howsome medication might help you.”We need to get better at the NHS, though, across theboard at being sure that we all understand whichinterventions really are evidence-based and it is notjust about looking at homeopathic treatments versustraditional medical treatments. Sir David has rightlysaid that, with regard to a number of traditionalmedical treatments, the evidence base of certain thingsthat are done is not that great.It is absolutely critical that we protect our relationshipbetween the individual clinician, whether it is a doctoror someone else, and the patient, so that they will bein a position to do the best for that patient at that timeand will not be influenced by cost.Actually, what the system needs to do, and theconsortia will be instrumental in this and the NHSCommissioning Board, the architecture, will beactually in defining through proper outcomes andunderstanding the proper outcomes, whichinterventions really make a difference. If we can getbetter at that, then we can get better at helping peopleto make informed choice.




Q73 David Tredinnick: There is a very good modelat the Hale Clinic not far away from here where theyhave a matrix of treatments available for differentconditions and they will go down a different routeaccording to different problems relating to a particulartreatment. I think I am done.Dr David Colin-Thomé: Just on a quick point, one ofthe things we have to do in the consultation is to makeus more participant, which is why the package ofthings that we have touched on, including patientreported outcomes, including personal budgets, is totry and alter that dynamic in clinical practice becausethat is the issue. Most people’s choice is not about, “Iwant to go to a different doctor or a differenthospital”; it is to have more say in what happens tothem. We have got to do quite a lot of work with theprofession rather than it being a White Paper issue.But it is interesting if you look at the internationalwork on shared decision-making where you givepeople more and there is an equal partnering that theyoften make more rational choice than their cliniciansin fact, and it is for two reasons. One is that obviouslythey need to be more empowered, if that is the rightword, but actually it could well be more cost-effectiveas well. That is the double whammy. Actually, that isnot a White Paper issue. That is about our educationof clinicians, which some of us are—David Tredinnick: Except, Doctor, you haveabsolutely gone to the position I was going to go to.The medical schools need to be teaching what thesealternatives are capable of producing. They can’t beexperts in every field, but a sort of MBA degree,master of business administration degree approach,where—I happen to have done one of those some timeago and so I can speak to it—you are actually taughtnot how to solve every business problem but you aretaught who to go to when there is a problem, and Ithink there is a distinction there.

Q74 Mr Sharma: The question I am going to askmay not be linked with the White Paper. Maybedoctors see it differently. Certain areas have few GPsbut a very overpopulated area where the populationhave different needs—needs based on cultural,traditional as well as language problems. In myconstituency this is a major problem, where a patientgoes and demands alternative medicine, alternativechoices. What developments have you made in that?Dr David Colin-Thomé: We have. I mean, we haven’treally addressed in over 62 years the maldistributionof general practice. Successive Governments havetried and that is why we have introduced a lot moreprivate sector people and so on. So it is a crude thing,which is where the Any Willing Provider bit comesin, and we do need to expand the range of primarycare services in areas of underprovision. That is ageneral issue.On some of the more subtleties about the particularneeds around language and things, that has got to beessentially a local issue. That is coming back to thediscussion we had on the other side of the table aboutthe Joint Needs Assessment. It is in those areas wherehealthcare and local government just need to get intothat community need issue because those people also

may well be not having access to other services too.Like Barbara, I worked in an area of socialdeprivation as a GP and the needs were not just healthcare or social care. There was a package of what wecould do for them.Look, the first task we have got to do is to increaseprimary care provision and access in those areas,which is what we are still committed to do, and thatis not a new thing in the White Paper. That is acontinuation of what Government policy has been forthe last about 20/30 years. We may not have done aswell as we could, and that is where the Any WillingProvider is sometimes needed because, even thoughmy colleagues in my profession do not alwayswelcome this extra input, we just need to think thatcommissioners have got to be, if I can use a slightlycreepy description, the people’s organisation ratherthan the organisation representing professionalgroups.

Q75 Mr Sharma: Those may not be yet finallydecided, but that national model, which is theframework, the language used in that, do you thinkthat these kind of needs could be included in thatframework?Dr David Colin-Thomé: I think locally, the JointNeeds Assessment is key. Are you talking about theNational Contract responding to it?

Q76 Mr Sharma: Yes. When you are dealing withthem nationally, then local people can adapt it.Dr David Colin-Thomé: The underprovisioning issomething, and Ben is probably more expert in this,and that is a national issue. It has got particularpockets of it, but it is a national approach. But someof the subtleties about the work involving socialinclusion and so on, has got to be, I am afraid, locally,but the needs assessment and making certain thatsomebody delivers on it, which is part of thataccountability issue, is absolutely fundamental andthat cannot be, I don’t think, prescribed nationally inthe National Contract. The National Contract at itsbest might present some minimal standards and so onand be looking at incentives. But to get the subtletyof localness, which is what the whole point of theWhite Paper is, that has got to be local, but how wehold those to account for that is the issue, and peoplelike you as well as others should be contributing tothat.Chair: Another part of that discussion is publichealth, which Valerie would like to bring herself in on.

Q77 Valerie Vaz: I know time is short and we arecoming to the end, but I think that is quite a key areaand I notice with some of your answers that it is notquite clear where public health fits into this wholemodel. But, my question is, could you outline what istheir role? I have seen that public health directors areaccountable to the Secretary of State, but they are alsoinvolved with the local authority. In your answer,could you say what their role is as commissioners, ifany, and, secondly, what discussions you had with theFaculty of Public Health?




Sir David Nicholson: And there is, of course, a publichealth White Paper to be produced in the near future.I am not quite sure of the date, but a public healthWhite Paper is coming out. You are absolutely right.We are having to deal with some of these issues nowbecause of the redesign of the service generally.What you have is you have a public health servicewhich will be nationally organised. You will havedirect accountability to the Secretary of State. Youwill have all of the Health Protection Agency and thenational bodies in that. Each local authority will havea—sorry, this is all subject to the consultation, thelegislation and all the rest of it. We are having to makesome assumptions in order to build the rest of it. Eachlocal authority will have a director of public health,which will be a joint appointment. They will have apublic health ring-fenced budget, which will beallocated to them by the Department of Health, andwith that budget they will commission public healthservices and interventions and work across the wholeof local government to make that a—-

Q78 Valerie Vaz: Is that separately from the GPs?Sir David Nicholson: Yes, this is completelyseparately and that will be part of what is the existingNHS budget. It will be in the national public healthservice.

Q79 Valerie Vaz: Do you have a figure for that?Sir David Nicholson: We are currently discussing it.I think Health England did a work that showed it wasabout 4%, but, genuinely, as we sit here at themoment, we do not have a proper figure around all ofthat, and they will commission public health services.That is the national public health service. But, ofcourse, the NHS does regard itself, and quite rightly,as a key player in the public health system. So we arenot saying that all that happens on public health onlyhappens in the public health service. The NHS has aresponsibility as well.What will happen is that either nationally the publichealth service can say to the Commissioning Board,“We would like you to commission some public healthinterventions” so they would work through theconsortia to do that, or the local public health servicecan commission NHS bodies to deliver some publichealth interventions. So that is the kind of mechanics,I think, that will broadly happen as part of thesechanges subject to consultation.Dr David Colin-Thomé: They will also haveconnections with the broader social determinants thatlocal authorities have and that might be a better fitthan we have had at the moment.

Q80 Valerie Vaz: I was going to say, how is thatbetter and how is that more cost-effective than whatwe have now?Sir David Nicholson: The benefit, I think, is partly,taking Barbara’s initial point, that there is someconfusion in the NHS about population health anddelivering services to patients, and they get confused.A great benefit, I think, is set out very clearly both interms of what they are, the population health stuff,and them putting it in the local authority which has a

much bigger impact on the wide determinants ofhealth than does the NHS. So it will now be a muchmore cost-effective way of doing it.The second thing is that we are ring-fencing thatresource because one of the issues, I think,particularly in the NHS, is that when the NHS comesunder financial pressure it is very often the publichealth bits of the NHS that get dropped off that wecannot afford that get taken out. At its most extreme,someone says, “Do you want a cycle path or a neo-natal intensive care cot?”, and the neo-natal intensivecare cot nearly always comes first. Bringing publichealth out into a separate ring-fenced area is a muchbetter way of managing that resource and beingaccountable for it, and we are engaged in discussionswith the Faculty of Public Health on all of these issuesas part of the development of the White Paper.

Q81 Valerie Vaz: Because they were saying that theirmembers were quite concerned that you had not donethat previously?Sir David Nicholson: How long ago was that?

Q82 Valerie Vaz: When did you first start yourdiscussions?Sir David Nicholson: As soon as the White Papercame out, I guess.

Q83 Valerie Vaz: I am also concerned about thisinterface between the local authority and GPs. Theyare well known not to have got on previously and notevery GP likes local authorities.Sir David Nicholson: They don’t like the PCTs either.

Q84 Valerie Vaz: No, but they like some of them.There was some good service out of PCTs, but I amjust wondering. When the GPs have their plans,presumably that is going to be signed off by the localauthorities. Is that right?Sir David Nicholson: Yes. It is true that there are a lotof views expressed about the relation between localgovernment and GPs. One of the things, I think, thathas been very impressive over the last few weeks isthe ways in which we have brought local governmentand GPs together in a way perhaps they hadn’t donebefore. I know David sponsored a whole series ofmeetings and I have had meetings trying to bring themtogether, and on both sides there is a great deal ofinterest and willingness to make it work.Of course what happens is the GP sees the localauthority provision of service from a different angle.They see it from an individual patient perspective upinto the system, and they see the frustrations andconcerns that individual patients have trying tointeract with this sometimes quite complicated healthand social care system. So their determination to makethings happen, I think, will be greatly received in thesystem. It will give a different perspective, I think,and local authorities could learn quite a lot from theperspective that GPs bring.The consortia will be part of the Health and WellbeingBoard and the Health and Wellbeing Board will do theJoint Needs Assessment. So the GPs will play a fullrole in relation to all of that. Our expectation would




be that the commissioning plans of the consortia,although they are accountable to the CommissioningBoard, would also be agreed by the Health andWellbeing Board.Dr David Colin-Thomé: Just on that, there are a smallnumber of GPs who are involved in things like localgovernment and so on, but we are trained as doctorsand the short-term specific thing which the publichealth directors need to be encouraging us to do isto go beyond even where the Quality and OutcomesFramework has taken us because the shortest-term hitsyou can have for helping health inequalities in thiscountry is people with existing disease to get bettertreatments and more optimal treatments and betteroutcomes.QOF has already shown a narrowing of theperformance between practices in posh areas to thosein poor areas, for instance, so those incentives areworking, but locally you might want to make adifference. You know, if a lot of GPs only want to bedoctors, we can actually focus their minds on doingthe things that will have a big impact on healthinequalities within their remit rather than alwayssaying they have to do all the broader things.But, again, if you look at the White Paper consultationdocuments from the GP organisations, all of themhave said that they want to be involved far more inhealth and wellbeing and working with localauthorities. As David has said, I organised a meetingwith the leaders to meet the Local GovernmentAssociation the other day, and we met the directors ofsocial services. So I think this is a catalyst where theremight have been Berlin walls or whatever. I think thisis a catalyst to begin to shape a difference because asa GP you get fed up with the inequities of what ishappening to your patients, even if you cannot domuch about them. Maybe now there is a better chanceto do something different because we have now gotthe budgetary influence.

Q85 Fiona Mactaggart: I am surprised. I think thatyou are describing something which, in the best of allpossible worlds, could work. I am concerned that wedo not live in the best of all possible worlds.Dr David Colin-Thomé: That is where I think theleverage that consortia might have on their GPpractices, rather than only going through a contractualroute, will help the ones who can be helped, whichmight include some incentives. I think it is interestinghow QOF nationally has made a difference. That isone of the best outcomes that we have achieved. It isnow about addressing the under performance onoutcomes between those who live in poorer areas—and, after all, the population are often sicker, andwhether we can do that in a more focused way.I do not want to think that all GPs are going to beinto broad public health social services. Many of themwon’t, but what they can do is refocus on what theyare doing better and I think incentives work. Therewill be those, as we have now, who are not that good.It is not just GPs. It is other doctors too. In fact someof the more successful PCTs, and we have got to givethem credit for that, have actually made great stridesin actually re-shaping the landscape of general

practice. I could quote Tower Hamlets, Knowsley andso on, socially deprived areas where they were havingstruggles with some of the quality of general practiceand they have made big strides. I expect consortia,using managers like that, to carry on that good work.I am not saying everything is perfect. All I am sayingis that there is more an alignment of trying to getthings done now than we have had before.

Q86 Fiona Mactaggart: My question was really aprecursor to asking why there are not more friends ofthe White Paper?Dr David Colin-Thomé: The GP organisations haveall supported the GP commissioning bit. The BMAhave had issues on other things, but if you looked atthe NHS Alliance and the NAPC, they have been verypositive and we have actually had one feedback froma group of young doctors and medical students whoalso support it. They will have individual queries butthere has been positivity.

Q87 Fiona Mactaggart: The evidence that we havereceived suggests really very deep concerns about therisks and the proposals.Dr David Colin-Thomé: You might need to think ofwho you have as witnesses as well and there aredifferent opinions and support.Fiona Mactaggart: We have put a very wide call outfor witnesses.

Q88 Valerie Vaz: And other GPs wanted it.Dr David Colin-Thomé: 25% in that survey.

Q89 Valerie Vaz: You quoted the BBC survey.Dr David Colin-Thomé: Yes, but how would youknow more, apart from the anecdotes?

Q90 Valerie Vaz: I thought you had been workingwith them?Dr David Colin-Thomé: But the GP organisationshave given higher figures than that, actually, and theyare the ones I have been working with.Dame Barbara Hakin: It is really important toremember that we are not expecting every practice tobe actively engaged in the biggest strategic running ofthe commissioning consortia. That is not going tohappen and it does not need to happen. Actually, whatwe are trying to do—

Q91 Fiona Mactaggart: But as soon as the otherguys get to commission, the guys who do not get tocommission will start squabbling with them becausethat is what happens.Dr David Colin-Thomé: One of the issues is how youengage them. If you look closely, some would wantto. Maybe some GPs may wish to be executives andapply for those positions. Most of us want to dosomething different would want to be leaders in someway to shape a culture, but we need to encourage theGPs who do not want to get involved to be likeleading care pathways for diabetes and so on, whichhappens already. It is just that being on the GPconsortia is the only option. Actually, if you just wantto be better at your general practice, that will help you




to commission better primary care. It is in all thosestrands that GPs can contribute, and I think that mostof the discussion is always on the technical side of theissue. I think, as I said, without being rude, there aremany GPs and GP organisations who have a muchmore nuanced approach of how all GPs can beinvolved in making things better rather than sitting onboards or being chief execs. That is the issue and Ithink that is why I am quite positive given the factthere is variation of opinion and skill as there is in allparts of the Health Service.

Q92 Chair: Can I ask perhaps Sir David to focusfinally on one issue that I think is of concern in theCommittee and outside? You have laid quite a heavystress this morning on the fact that there are two anda half years before the new consortia actually take uptheir responsibilities and therefore there is time forthis process to mature. I understand that argument, butI am struck that the same day the new consortia takeup their responsibilities is the end date of the subjectwe were discussing when you were here last week,which is the process of change in service delivery,which you have described as not merely the mostambitious in the public sector but the most ambitiouscurrently in the economy and arguably the mostambitious anywhere in the world.You might think that would be enough to take onduring that two and a half year period without thiscompletely separate process that is often confusedwith that process of service change. We have got twoprocesses actually going on in parallel and I wonderedhow confident you are. We can deliver the £15 to £20billion service reconfiguration objective becausewithout that all of this becomes a rather secondarydebate.Sir David Nicholson: This is very large and verychallenging and in a sense it is hardly surprising, is it,that people raise concerns about it because we alleither work in it or depend on the NHS for our healthand wellbeing. So it is a very serious set of issues thatwe are facing. It is interesting the way you describethe two parallel approaches, and part of the skill ofthe transition is going to be making them not parallelbut mutually reinforcing. That is quite difficult to do,but I think we can already see ways in which we cando that. I may have said this before, but, for example,all of the plans for sustaining ourselves in future goingforward, both in terms of improving quality andreducing cost, have an element around bettermanagement of long-term conditions and the bettermanagement of hospital admissions.GPs are in the unique position of being able toinfluence that like no other group can. So getting themengaged in that very early, you know, I would ratherhave lots of GPs running around the country talking

about and doing that than perhaps talking about thegovernance of consortia. For me, that can wait. Sohow do you do that? Similarly, on the foundation trustissue, how you make these organisations sustainablein the future again is mutually reinforcing theexistence of today.The third area is the whole issue about communityhealth services—a relatively unreformed bit of thesystem which we spend £10 billion on and treat hugenumbers of patients in. How can we use the reforms,the Any Willing Provider arrangements, all of thosethings, to engage in community health services nowto make those changes? That is the way, I think, wehave got a good chance of making it happen. If wekeep them as parallels and separate them, then I thinkwe will not make a success of it.

Q93 Chair: It is a substantial challenge?Sir David Nicholson: Yes.

Q94 Chair: I think you have been very clear. Doesany member of the Committee wish to conclude orare there any closing remarks from you?Dr David Colin-Thomé: Can I just add to that as arecently retired clinician. Basically, it is us clinicianswho spend the money by our actions and, before, wewere disconnected from the responsibility of thefinances, and I think, as David was saying, there havebeen parallel universes and this is the best bet we haveof trying to bring them together around the particularissues that David mentioned around emergencyadmissions and so on, as well as long-term conditioncare. Unless we get those together, we will struggle.In the examples that we have quoted from the Stateswhere they have got clinician engagement, it isbecause they have actually got the alignment of thosefinances of clinical activity and, instead of rationing,then we could have that rational approach as well aschallenge a lot of the stuff we spend money on. Thereare certainly in the care of those with long-termconditions a lot of duplication and unnecessaryadmissions, etc, etc. Unless we bring those twotogether, I think, we would have a bigger struggle intrying to hit this financial aim.

Q95 Chair: It is a question of whether you canactually get the clinical engagement in that process atthe same time as there is the management changeprocess going on?Sir David Nicholson: You can’t do one without theother. We simply can’t deliver the 15 to 20 billionproductivity gains without a significant degree ofclinical engagement and leadership, and this is onepart of that.Chair: Thank you very much for your time.

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Members present:

Stephen Dorrell (Chair)

Rosie CooperNadine DorriesAndrew GeorgeFiona MactaggartGrahame M Morris

________________


Witnesses: Professor Steve Field, Chair of Council, Royal College of General Practitioners, Dr RichardVautrey, Deputy Chair, General Practitioners Committee, British Medical Association, Dr James Kingsland,President, National Association of Primary Care, and Michael Sobanja, Chief Officer, NHS Alliance, gaveevidence.

Q96 Chair: Gentlemen, we will begin, if we may.Thank you very much for coming to meet theCommittee this morning. I think it would be helpfulif I could ask you to introduce yourselves and just saya couple of sentences about the organisations that youcome from and the people on whose behalf you arespeaking this morning. Dr Kingsland, do you wantto start?Dr James Kingsland: Good morning. I am JamesKingsland. I am a general practitioner. My practice isin Wallasey in Merseyside. I am President of theNational Association of Primary Care. This is amembership organisation that has been around forabout 10 years. It evolved from the NationalAssociation of Fundholding Practices and the multi-funds and total purchasing sites that formed the NAPCabout 10 years ago. As a membership organisation, itlooks to help interpret policy into practice to help ourcolleagues do their job better—and by “colleagues” itis mainly focused on the broad spectrum of healthcareprofessionals working within general practice.Also, over the last 18 months I have been contractedto the Department of Health, at that time to help PBCdevelop but now GP commissioning be implemented.Professor Steve Field: I am Steve Field. I’m a GP incentral Birmingham and Chairman of the RoyalCollege of General Practitioners. We are the biggestRoyal College in the world and we represent 42,000GPs in this country. We had been set up in the ‘50s asa charity, really, to improve the quality of careprovided for patients by GPs and we see ourselves aspromoting high-quality care.It is important for this Committee, I think, to notethat we are a United Kingdom and international body.Therefore, what I will say later, hopefully, will reflectmembers who are not just from England but from theother countries as well.Dr Richard Vautrey: I am Richard Vautrey. I’m theDeputy Chair of the BMA’s GP committee and, thatcommittee represents GPs in four nations, so thecomments that we have brought and given to theCommittee reflect the views of GPs in all four nations.I am a GP in Leeds. I’m also the Chair of one of theGP consortia in Leeds, one of the three bigorganisations that are working at the moment with aPrimary Care Trust to try and make this vision areality.

Mr Virendra SharmaChris SkidmoreValerie VazDr Sarah Wollaston

Michael Sobanja: Michael Sobanja, Chief Executive,NHS Alliance. I’m not a GP. I’ve been a HealthService Manager for over 30 years. The NHS Allianceis a membership organisation which deliberatelydraws its membership across clinical professionals,managers and lay people in the Health Service.Historically, it grew out of the National Associationof Commissioning GPs, which, Chairman, you willrecall as being one of the proponents of LocalityCommissioning Groups in the 1990s.Our function is to lobby Government for sensiblepolicy, to support colleagues in its implementation andto spread best practice.

Q97 Chair: Thank you very much. As I have alreadysaid, thank you for joining us this morning tocontribute to the inquiry which the Committee haslaunched on the future of commissioning in theHealth Service.In parallel with this inquiry, you probably know, weare also doing an inquiry into the impact of theGovernment’s public expenditure plans for the HealthService. When we were engaged in seeking evidencein the context of that inquiry from Sir DavidNicholson, he said that he regarded the managementchallenge that was involved in delivering the publicexpenditure plan and the £15 billion to £20 billionefficiency savings that are implied by that plan as thebiggest management challenge, certainly, in the publicsector and probably in the economy as a whole.When he came back, then, to give evidence on thesecommissioning proposals I asked him how he thoughtthese two processes would co-exist—the delivery of£15 billion to £20 billion efficiency savings and thedelivery of these changes to the commissioningprocess. His answer was: “Part of the skill of thetransition is going to be making the savingsprogramme and the transition to the new system notparallel but mutually reinforcing. That’s quite difficultto do but I think we can already see ways in whichwe can do it.”I would just like to begin by asking our witnesses tocomment on those two parallel programmes. Whowould like to begin?Dr Richard Vautrey: Shall I start? One of the thingsthat we have welcomed as part of this White Paperproposal is the greater clinical engagements that the

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2 November 2010 Professor Steve Field, Dr Richard Vautrey, Dr James Kingsland and Michael Sobanja

Government are wanting to see, and that has beenlacking, quite considerably in some areas, over the lastfew years. GPs and other health professionals want toget more involved, in partnership with their consultantcolleagues in secondary care and public healthdoctors, to try and re-design care pathways to makethem more responsive to bring services closer towhere people live. We can do that by talking with ourPrimary Care Trust colleagues and, by doing so, thatwill hopefully achieve some of those savings andenable us to re-invest resources in better carepathways.But that has to be done together, and I think one ofthe challenges over the coming years is how weactually ensure that all GPs and all healthcareprofessionals have a feel that they have a stake in theirlocal organisations and in their local healthcareeconomies so that they are all working together ratherthan in an opposed fashion, as has happened inrecent years.Professor Steve Field: I would agree with Richard.We welcome the White Paper because of clinicalengagement and clinical leadership. We believe it isnot just about GP leadership but that GPs should beworking with specialists, with nurses and with othersto make this happen.The reality is that clinical leadership was lacking inmany of the old PCT organisations and you could seethat from what was happening in world-classcommissioning and practice-based commissioning.In some areas, like Tower Hamlets, where you did getgood Medical Director leadership and engagement ofGPs, you could really transform the Service. But youneed high- quality managers to actually support andrespect the clinical input. However, unfortunately, itwas very patchy across the country. Also, with someof the ideas which were good in policy terms, forexample, the Darzi centres, once they were parachuteddown so that every PCT had to have one, you pushedthe clinicians back to the side. It was things comingdown from above rather than clinical leadershiplocally. So we welcome the change.I think what we would have to offer, as clinicians,would be about evidence-based practice and aboutlooking with patients and the public at what sort ofservices are needed locally. We will also need politicalsupport, I believe, because at the moment the tariff issucking work into hospitals and sucking money intohospitals. We need to keep people out of hospital andwe need to reconfigure some services, not necessarilythe hospitals themselves but services within hospitals.By clinicians leading, working across primary andsecondary care, we can get more radical change thanwe have had over the last few years. I think that’swhat is needed now but I also believe it was what thepolicy was meant to be before.

Q98 Chair: In a sense, I think your answer is that byengaging the clinical community, and in particularGPs, more actively in the commissioning process, theDepartment is enhancing its chances of delivering theefficiency gain that it needs. Is that a fair summary ofthe answers so far, and then I’ll come to Mr Sobanja?Professor Steve Field: Correct, but I don’t think it isjust GPs. For example, there are savings to make with

nursing leadership in the community and how we canjoin up health and social care around the patient. So Idon’t think it is just general practitioners, but yourassertion I would agree with.Dr Richard Vautrey: I think the key thing is to seegreater collaboration across the primary-secondarycare divide. For too long doctors have worked in silosand we have become less familiar with our consultantcolleagues and with other colleagues working in thehospital. We need to bring doctors together because itis only when all doctors in an area agree about howpatients can be best dealt with that you actually seechange. If you have got one group competing againstanother, that would actually be a disaster and counter-productive. That is one of the concerns that we havewith the White Paper—the greater emphasis oncompetition against what we believe would be a muchmore sensible emphasis on collaboration.Michael Sobanja: For me, Chairman, it starts with thedefinition of commissioning, which is about how wecommit our resources within the NHS system. If youstart from that particular point and look at clinicalactivity, whether it be in general practice or insecondary care, the vast majority of resources arecommitted by clinical acts—in general practice byreferral, by treatment, by prescribing and so on—andchoices have to be made.I think one of the mistakes we have made in the pasthas been to try and run this rather nebulous term of“clinical engagement” alongside a managerial agenda.One of the reasons why I don’t think practice-basedcommissioning has been any more than patchy is thatit ran in parallel. A practical example would be that,when the then Government were putting a great dealof emphasis, and perhaps rightly so, on reduction ofwaiting times, practice-based commissioning was notseen as a means of achieving that but something youdid on the side as well. So GP commissioning and thefuture of commissioning have got to be about how wedeliver the Health Service outcomes in the futurewithin finite resources. That is intrinsically tied upwith clinical activity.Dr James Kingsland: I remember a departmentaldocument called An Organisation with a Memory. Iwent into practice in 1989, a year before the internalmarket was formed, and, over the last 20 years, haveadopted every vehicle that has tried to manage that inthe vanguard, as a first wave.I think what we need to review is the successes ofcertain vehicles. The consistency about when theinternal market has been managed successfully iswhere clinical decision making has been aligned withfinancial accountability. We saw that in fund-holding,albeit flawed. I appreciate this is not fund-holdingplus, but the alignment of clinical and financialaccountability generally led clinicians to make betterdecisions on behalf of their patients or with theirpatients and better resource usage. We didn’t seeclinicians making rationing decisions. That was bornfrom the King’s Fund report a couple of years afterfund-holding had finished which showed that, year onyear, there was a 4% efficiency in the management offund-holding budgets, despite the budgets being set onthe historic outturn, and we saw pathway design andcare changing as a result of that alignment of clinical

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decision making. I think that was the important thingto learn from any of the processes we have used to tryand manage the internal market.

Q99 Chair: You used the phrase “an organisationwith a memory”. The BMA Memorandum to theCommittee uses the words “extremely alarmed” atwhat it describes as a “potential vacuum” and a “realrisk of PCT implosion”. That is quite strong language.It addresses, very directly, Dr Kingsland’s phrase of“an organisation with a memory”. I wonder if youwould like to enlarge on that and then I would beinterested in the extent to which your colleagues sharethat analysis.Dr Richard Vautrey: We do have serious concerns,and they are already being demonstrated as a reality,that senior PCT managers are leaving the PCT andpeople are being offered redundancy and takingredundancy, the very people who we need in the futureto make these changes work.What would be far more sensible is a plannedreduction in PCT numbers, of the staff who workwithin PCTs, as is already happening and as wascharged to PCTs, but done in such a way that weretain the people who we are going to need to enablethese emerging GP-led consortia to be successful.What we don’t want to do is for the best managers toleave to go to large multinational firms only then tohave to hire them back at an inflated rate of pay and,also, to add on their redundancy payments as well.That would be a disaster for the NHS as a whole andwould be very costly.We have already got examples where wholedepartments of people have accepted redundancyterms and so will be leaving very early on. We needto try and have a managed transition where, yes,people will lose their jobs and the redundancies willbe made, but we need to try and actively retain thebest people so that we can make these neworganisations a success.

Q100 Chair: I know Rosie Cooper wants to come inon this, but perhaps we could have a reaction fromother members of the panel as well.Professor Steve Field: Thank you. I think transitionis going to be the key. There are some fantastic PCTmanagers at all levels—they are just not everywhereacross the country—and we just want to make surethat we don’t lose them, as Richard quite rightly said.Transition will be the key because not only is it aboutsetting up new consortia and supporting them, but itis managing the costs within the NHS, as you quiterightly say, during that transition period. Losing gripon transition will mean that consortia might be settingup with deficit budgets and problems with localcontracting. So the PCTs need to be supported. Theyneed good clinical leadership now so the GPs need toget in there now to support. But the SHAs, I think,have a key role in supporting the PCTs locally andmaking sure that they are supported during thistransition period whilst the parallel world starts. Weneed the commissioning board to start up soon so thatwe have direction from there whilst Barbara Hakinand the transition team carry on keeping the grip allthe way down the system.

Michael Sobanja: In its response to the consultationprogramme, the Alliance called for greater flexibilityin the transition that would allow those who wereready in GP commissioning to move quickly andthose who weren’t to develop their skills and movemore slowly, even within the capsule of time that theGovernment envisaged.I think one of the problems is that we see a documentat the moment that could be interpreted as being aone-size-fits-all. I agree with what my colleagues havesaid—that this is not going to be something that willbe determined in Whitehall, in Richmond House. Itwill be something that has got to come from theground locally so that people can develop at their ownpace within an overall time scale, keep the good andmake those particular changes.But the thought that we are going to continue withPCTs until 31 March 2013 and, suddenly, we’ll wakeup the following day and the world will change is nothow any reorganisation I’ve ever worked through inthe Health Service has taken place in reality. And itwon’t this time. PCTs will start to come together.They’ll start to come together with SHAs, in my view,and the concern is that that be driven locally and notfrom the top.Dr James Kingsland: We need to look for this systemto leave a strong and robust legacy. We need to lookat why the last system failed, and I think there werethree clear reasons why PBC as a vehicle failed.Number 1 was because it was management-centric. Itdidn’t change cultural behaviours that thecommissioning programme to involve cliniciansrequired. The system didn’t allow clinicians to havethe tools to do the job, which was ownership of somebudgetary control, and the data we are using is stillfairly poor, and that stifled leadership.We need in this transition period for our NHSmanagers to evolve what had failed within PBC andleave this legacy. My concern is that we are spendingtoo much time on structural reorganisation, not thenew function of what commissioning is trying to do,and the form should fall out of that function. We areat risk of being sanitised, at the moment, by this hugeHR headache of losing or re-accommodating NHSmanagement and not focusing on that as the mainissue of the transition as opposed to what failed in thepast and what we need to do to make sure that GPcommissioning is successful.

Q101 Rosie Cooper: I am really interested in yourcomments because David Nicholson, when heappeared before us, was very clear that he thought thiswas manageable and that, in the interim, before thecommissioning board is up and running and consortiawere in place, PCTs and Strategic Health Authoritieswould, if you like, hole the ring.I have put some questions down about the number ofstaff employed a year ago and the number of staffwe’ve got today, and I’m sure that will elicit someinteresting figures. You have made some comments sofar this morning about needing more clinicalengagement, high-quality managers and the fact thatit is patchy across the country. These are the verypeople who have been abused every time you read anarticle “Managers are poor. We don’t need them. Get




rid of them. They’re a waste of money. They’re adrain on the NHS.” As somebody who has beeninvolved in the NHS for a long time, that is not true.There is the degree and all the rest of it.I’m saying to you that, currently, what I’m looking at,even in my patch, is that PCT managers, PCT staff,Strategic Health Authority staff, those who are goodare going off and are finding other avenues. Thequestion is, if they have been treated in the way theyhave been, why would they stay in the hope that, atthe end of this, somebody may employ them or not?You talked about “managed retention”. In this climate,with these sudden changes from the PCT to this newconsortia world, not knowing how and when thoseconsortia may come together, how would you manageto retain those staff today? What message would yougive them and what message would you give theDepartment of Health that they should be doing andsaying right now to make this work? Frankly, whatI’m looking at is the Marie Celeste. We are all lookingat each other and everybody with ability has run away.Dr Richard Vautrey: Right from the beginning of thisprocess the BMA has been absolutely clear that wewant to retain the best NHS managers within thesystem because we need them to make this work.One of the things that has often been misunderstoodabout this process is the idea that GPs are going to berunning everything, doing everything and managingeverything—doing all the finances, the HR and all therest of it. That is clearly not what is going to happen.There will be a very small number of GPs directlyinvolved in management and leadership. But the bulkof the work will be done by expert lay managers, andwe hope the very people who are involved in the NHSnow, who we really do need, will be retained. Whathas been lacking is a very clear message from thecentre saying, “Yes, we do need and value yourservices. We want to retain your expertise and yourfuture will be best in these new, emergingorganisations where you will be able to make adifference for the patients that you have been tryingto serve over a number of years and, by the newarrangements, hopefully, get over this management-clinician divide that has operated for far too long andtry and bring people together to work for onepurpose.”Professor Steve Field: I would agree but I would gofurther. In some areas, it is a mixture of skills andattitude and behaviours. I think something we havegot to try and do which the College has been doing,just as the BMA has, is actually to try and supportmanagers because we need high-quality managers.There is an emphasis over skilling-up GPs to docommissioning and leadership which is needed. Butthere is also something we need to do with managersabout their professional development over the next 18months and I would like to see an increased emphasison supporting managers so that we can get them toacquire the skills we need in the new world, and thatshould help with retention.

Q102 Rosie Cooper: What vehicle would they be inwhile they are acquiring these skills? They are eithergoing to be in a PCT or Strategic Health Authority

with the prospect of it disappearing in x months or ayear. Why would they stay to do that?Dr Richard Vautrey: It is quite possible, as ishappening already in some areas, for key PCTmanagers to be seconded to emerging GPorganisations. We are already seeing that theorganisations that have been, perhaps, of longer lifeso they have been around already for two or threeyears and have been the better of the practice-basedcommissioning groups, are in a position to take thoseparticular key individuals and for them to actuallywork on behalf of those new organisations at quite anearly stage.

Q103 Rosie Cooper: So we’re going to havedifferent tiers of this policy right through the country?Professor Steve Field: Yes, you will because thewhole point, which we support, of the idea ofpathfinders and people going forward at the speed thatthey’re needed to go locally, means that you canalready do a lot of what is in the White Paper nowwith devolved responsibility within a PCT area,including the governance arrangements.

Q104 Rosie Cooper: So why do we go through allthis huge structural change?Professor Steve Field: But what we need—Chair: I am going to bring Mr Sobanja in.Michael Sobanja: I was just going to say, if theHealth Service sees this as another top-downmanaged, uniform reorganisation based upon a systemchange, it will fail. It will be no more successful thanthe ones that we have seen over the last 20 or 30years. This is about enabling people to developservices with local people for local people indiffering ways.I think with managers, what I would be saying to themat the moment and am saying to them because manyof them are our members—we have 120 PCTs inmembership—is, “Start the dialogue with your GPcommissioning colleagues. Work together to developthis.” What I would say to David Nicholson and theDepartment of Health is, “Allow some flexibility. Donot seek to impose one single programme as if thiscan be managed from the centre right across thecountry.” I don’t believe it can be.

Q105 Grahame M. Morris: Good morning,gentlemen. As the Chairman has already mentioned,Sir David Nicholson told this Committee in evidenceon 1 October, that, “The scale of change in the NHSis enormous, beyond anything that anyone from thepublic or private sector has witnessed.”We have already heard, from your opening remarks,your view that GPs want to be involved in greaterclinical engagement, for example, design and carepathways, but from the point of view of theCommittee’s investigation, how does that square withthe attitude of GPs? Do your members share thisview?The reason I ask is this. The BBC survey that wasconducted quite recently found that only 23% of GPsthought GP commissioning would benefit patientswith 45% saying it would not and then the King’sFund survey found that 41% didn’t agree that the




changes would benefit patients. Do you agree withthose figures or do you have a view on the views ofyour organisation being in conflict with GPs?Dr James Kingsland: I can give a view on twoaspects. One is the actual surveys. Just to quicklyreflect about management, I am not getting intosemantics about commissioning but if you use theword “commissioning” to a manager or a GP they willunderstand very different things by it. I think some ofthese surveys have talked about commissioningwhere, as Richard was saying, if we are trying tocreate doctors into doing what PCTs used to do, thereis no future in that. We have got to be clear. We needstrong management on the part of commissioning thatprocures new services and acts as contracts managers.We need clinicians to do needs assessments andsecuring services against that need.When you talk to clinicians about upskilling withintheir own practice, extending care, expanding theprimary care team to give a multidisciplinaryapproach to delivering care and making betterdecisions with the ability to use a budget, I think mostcommissioners get that and say, “That is what I willdo”. Certainly within our membership, which is oftenat the vanguard of change, we have a large majoritywho are saying, “That’s exactly what we understandby GP commissioning and what we need to getinvolved in.” The smaller numbers, as Richard wassaying, might be skilled in ways that they want to getinto contracts management. So I think sometimes asurvey has asked, in a process that sayscommissioning equals procurement, “Do you want tobe involved?”, and clinicians say, “No.” But, if thequestion is “Do you want to be involved in makingbetter decisions on behalf of your patients?”, they say,“Yes.” So it is not getting into semantics about theterm but it is understanding what part ofcommissioning we need clinicians to do and where weneed strong management.

Q106 Grahame M. Morris: Without labouring thepoint about the survey, there were two elements to theBBC survey. It was quite overwhelming. When GPswere asked, were they willing to take oncommissioning, 57% said they weren’t willing and25% said they were. But, in relation to the other issue,on which there has not really been an answer, ofwhether GPs feel it would benefit their patients, onlya minority, only 23%, thought it would.May I just move on from there in relation to some ofthe other points that you raised, perhaps to ask theRoyal College of GPs representative about thestructure. Some of your members thought it would bemore sensible, in the evidence that we have seen here,to keep Primary Care Trusts and simply to add GPsto their boards rather than go for this radical overhaulwith GPs expected to go it alone. Could you elaborateon what the advantages and disadvantages would beof that approach?Professor Steve Field: Some of our members, youquite rightly say, did think that we should carry onwith PCTs with better clinical leadership. We actuallyonly had 400 out of 42,000 members respond to theconsultation, although that was a representativesample of the different types of GPs and it included

people from outside England. So you have to take thatpart of it in that context. Many others felt that thiswas the way forward from a commissioning GP pointof view.PCTs are very different to what the clusters, theconsortia, are going to be for commissioning. Theyhave different functions. It is true that, if we wouldhave had under the previous Administration high-quality clinical leadership in the PCTs, a lot of whatis being pushed now about re-design of serviceswould have happened. But, frankly, it didn’t. It failed.You can read your own review or your predecessors’review in the report. It gives, very clearly, the reasonswhy the Select Committee then felt it had failed.So change is needed. The issue that I said earlier isthe most important one is the transition. The transitionshould be locally sensitive so that if you have got avery good PCT that is working very well with itsclinicians during transition, that’s fine. You hand overresponsibility in a different way to an area where,actually, the managers in the PCT and the cliniciansare not engaged. So it has to be locally determined.But in all of these transformational changes, as JohnKotter says—one of Harvard’s leading gurus onleadership—if you don’t create a sense of urgency, ifyou don’t actually create a clear vision and takepeople with you, it’s not going to happen. Theproblem with World Class Commissioning was therewas no sense of urgency for change and, actually,there wasn’t a clear vision for the clinicians where wewere going.I think what we have now with the new policy is aclear vision. What we have got to try and do is getmore and more people engaged to take that visionforward.Michael Sobanja: First, if I may say so, the numbersreflected in the BBC survey and the King’s Fundsurvey are not those we have experienced within theorganisation. For instance, over 80% of people in thesurveys we have conducted have said they want to getin there and get involved. But that may be explainedby the terms of the question, as described by DrKingsland.I think the issue about changing PCTs and simplychanging the composition of the board goes back tothis point that James made. These changes are aboutchanges of behaviour and culture, not just aboutsystem. They require the centre to change theirbehaviour and the NHS commissioning board to havea different relationship than the Department of Healthhave had in the past. In my view, simply changing thecomposition of PCTs would not have been sufficientto change the culture and behaviour in the NHS.

Q107 Valerie Vaz: It is part of the same thing, butI’m trying to work out under this new commissioningbody or the GPs commissioning the conflicts that willarise. Whilst you say there wasn’t any urgency, andyou may not have taken the managers with you, didyou take the patients with you? That would be myfirst point.But, also, ultimately, the GPs who do commission aregoing to come across a conflict between individualpatient decisions and what happens with thepopulation. So how would they cope with that?




Dr Richard Vautrey: I think even over the last fewyears under the current arrangements GPs have beeninvolved in professional executive committees, inleadership roles, even directors of PCTs. So there havebeen issues of conflict of interest that have had to bemanaged and openly declared in the usual way, as Iam sure you are familiar with. That will continue inthe new world. There will have to be a transparency,an openness.One of our concerns, though, is if there is anysuspicion that the individual patient feels that the GPsat in front of them is acting or behaving in a waythat is conflicted and that they are more interested inthe financial savings that the consortia are going tomake rather than the direct patient care that they aregoing to be providing to that individual or treatmentsuggestions that they are going to be offering.I think what we need to try and ensure is that thereisn’t a significant financial conflict that starts toemerge in individual patient consultations. That canbe managed and it is possible to manage that and, forthe vast majority of GPs, they will not be involvedin the direct, day-to-day management of the GP-ledconsortia in the same way that they are not involvedin the direct management or running of the PCT. Itwill be for a small number of GPs where the issueswill become more apparent, but I think it can bemanaged if it is done in an open and transparent way.Professor Steve Field: You make a really importantpoint. I think there is a tremendous opportunity, withthe proposals, for more patient and public engagementand I particularly like the link through to localgovernment with the Health and Wellbeing Board andHealthWatch. If we can start to get more engagementin the planning of services with patients, in some areasit has been reasonably good. In other areas it hasn’tand I think we need to take the opportunity there. But,to answer the conflict question, Richard hasanswered that.

Q108 Valerie Vaz: Actually, no, he hasn’t. What hesaid is you are going to try and ensure it doesn’thappen. You haven’t told me how and you haven’ttold the public how. Also, there are going to beindividual funding decisions that are going to comeup with each individual patient. How is that going tobe managed by the GP and what safeguards do youhave?Michael Sobanja: Let me suggest to you that that hasbeen the business of general practice for as long as Ihave been in the Health Service.

Q109 Valerie Vaz: And that’s why we are concernedabout postcode lotteries and health inequalities.Michael Sobanja: A general practitioner, in decidinghow much time to spend with one patient as opposedto another or to make choices on care packages whichthey create for individuals, has an element ofopportunity cost. They have been doing it for yearsand this is an issue of scale at population level and,where I would absolutely agree with you, movinggeneral practice from a preoccupation with practicelist to population health will be key but the nature ofthe decision actually doesn’t change from what hasbeen going on for a long time.

Q110 Rosie Cooper: I agree; that is what I did whenI was on a Strategic Health Authority many moonsago. But the point I really think that we need to get tois governance on consortia. A wellbeing board,accountability at a distance, is, for me, not acceptable.I believe that patients and/or the Councils, whateverthe Secretary of State indicated that he believed wouldbe the transparency—he didn’t say transparency in acupboard—he wasn’t clear. I thought, when he wastalking to us, that those people would be on thecommissioning board and, until and unless thecommissioning board itself has patients or councillorsor whatever—non-exec directors—if they are notthere at the heart of decision making, this is flawedbecause we will not have the assurance we need.The Secretary of State also wouldn’t answer whethercommissioning board meetings would be held inprivate or in public. These are absolutely essential andgo to the core of whether local people, the health ofthe economy, will actually be represented at thedecision-making point.Dr James Kingsland: I think we need to extend it pastHealthWatch or even at the GP consortia. We have gotto go into the micro systems where patients registerfor their care and expect that the practices who willbe responsible for some budgets will have, at alllevels, patient involvement in decisions.For example, for a long time our practice does notmake any decisions, any new protocols or any newcare decisions without the involvement of our PatientPanel. I think we need to see that expanding.Just to go back to one of the questions about wherewe have got evidence, and it is not a lot and some ofit is within fund-holding, where clinicians hadaccountability for Health Service budgets, theevidence is that resources were used more effectivelyand efficiently, for patient care the outcomes wereimproved and rationing decisions were, generally, notmade. So where we have got evidence the alignmentproduces better outcomes.

Q111 Valerie Vaz: So what happens when the GP hasa private stake in a private company that is providingservices? Do you know how many GPs currentlyhave that?Dr James Kingsland: This was something that was, Ithink, created from early frustration in practice-basedcommissioning where, as I was saying earlier, thetools weren’t available to become commissioners. SoGPs reverted to a provider-type model and set up for-profit companies in competition with hospitals. Thatwas legitimate as a process but not consistent withwhat practice-based commissioning was trying toachieve.With regard to the governance around that, I think itis just that PCTs should have been a little bit sharperon the governance in that patient choice should alwaysbe paramount. If a practice is referring to anorganisation in which they have a financial interestand choice can be monitored, and if choice is givenand the patients don’t choose to go to that, there isnothing wrong, and the pecuniary interest in thatreferral needs to be declared to the patient. If that isdeclared, then there’s nothing wrong. I think thatwhere that declaration isn’t made or there are some




covert referral patterns into their own service, thenthat is unaccountable and the GPs are in breach oftheir primary care contract and in breach of GMCregulations. I think that just needs monitoring. I thinkif practices are developing that, I don’t think it is partof the commissioning programme, though.

Q112 Valerie Vaz: Do you know how many GPshave that now? I don’t know. I’m just asking.Dr Richard Vautrey: We don’t know the figures andI think one of the things that we need to be careful ofis that, whilst we clearly need to have robustgovernance arrangements and we clearly need to beopen and transparent around conflicts of interest, wealso need to try and encourage practices particularlyto take on more services and to develop their skills.That is the only way, long term, we are actually goingto be able to meet the significant financial challengesover the next few years. We have to transfer work outof the hospital and into the community and we haveto get practices—not just practices, but others aswell—to be able to step up to the challenge ofexpanding their services, ensuring that patientsactually get a good deal, but locally.

Q113 Rosie Cooper: Would you be happy if patientsand/or councillors were on consortia boards? Wouldeach of you be happy?Michael Sobanja: I would say it is an absolute pre-requirement that every general practicecommissioning group has public representation on itand I would go further and say there has to be amutual lock with local government to make sure thattheir public health activities and the commissioningplans of GP commissioning consortia arecomplementary. But, absolutely, I think that should bea key requirement.

Q114 Rosie Cooper: Can I ask each one of you that?Dr Richard Vautrey: I think any emerging GP-ledconsortia would be foolish not to involve patients ina meaningful way. Over the last—

Q115 Rosie Cooper: On the board?Dr Richard Vautrey: We don’t know what the boardstructures are going to be yet but I think they—

Q116 Rosie Cooper: At the decision-making point?Dr Richard Vautrey: Decision-making, yes, clearly.

Q117 Rosie Cooper: At the decision-making point,not to be considered?Dr Richard Vautrey: Yes, because the—

Q118 Rosie Cooper: Not throwing a snowball at amoving truck?Dr Richard Vautrey: Yes, because if they fail to dothat, GP-led consortia are going to have to make verydifficult decisions about prioritising one serviceagainst another. If you don’t involve patients in thatdiscussion and in that decision-making process, thenyou will end up with conflicts and local campaigns.Rosie Cooper: You are going to get that.Dr Richard Vautrey: You’re going to get that anywaybut it has to be seen as comprehensive as possible.

Q119 Rosie Cooper: But I’m asking a question aboutthe people being there at the point of decision making,not and/or, not “and to be consulted”, but with a voteat the point of decision making.Professor Steve Field: If you want my answer, Iwould say “Yes”. There are different ways of doingthat, but I do believe the public should be on theboards of the consortia. But I think there needs to bemuch more effective work alongside that in theconsortia linking across to local government where thepublic really truly do have much more input indesigning local services, which is why I said earlieron I do like the link with local government.What we must not do is slow down change. So youneed the public to be on board. If you look at Rugbyand places where they have had issues with their localhospitals and moving from Emergency Departmentsto Minor Injuries Units, the way you effect change isto get the public on board to really understand whyyou need to change things and listen to the publicmore effectively. I do think, actually, we have theopportunity to do that. In some areas it has been reallygood to date but we need to get that everywhere.Dr James Kingsland: I would go further. I would sayof the 8,230 micro commissioning systems that will bein place, practices who have budgets should inherentlyhave a patient voice as part of their everyday practice.The commissioning board that develops from theaggregation of those practices is an aggregation ofthose practice-based patient groups. I would like tosee every general practice have a strong voice from apatient representative organisation.Dr Richard Vautrey: And it is that model that myown group is developing.

Q120 Rosie Cooper: A strong voice is not what I amtalking about. It is a vote at the table. You can be asstrong or as quiet or as noisy as you like. The onlything that matters is when you’re at the table andyou’ve got a vote.Chair: Do you want to come in on this, Fiona, or arelated subject?

Q121 Fiona Mactaggart: I’ve been hearing you allseeming very relaxed about what I think, if I haven’tmisunderstood, is going to be what is called by themedia “a postcode lottery”, that there are going to bevery great differences between different areas in whatis provided. Am I right?Dr Richard Vautrey: No., we are very concernedabout the potential for postcode practice or treatmentand decision making. The decisions around NICEyesterday are a case in point where, clearly, it makessense to have a national body making those verydifficult, challenging decisions so that there is someconsistency around the country.What we would hope that happens over the comingyears is that there is a greater sharing of informationand greater benchmarking so that practices and groupscan measure themselves against the best more clearlyand try to aspire to that and get some standardisation.But I think there is a concern that you are going toget very different decisions made in different parts ofthe country which patients will not necessarilyunderstand.




Q122 Dr Wollaston: Of course one person’spostcode lottery is another person’s local decisionmaking, I guess. That is always going to be the issue.Dr Richard Vautrey: Absolutely, yes.

Q123 Dr Wollaston: Could I come in on a couple ofpoints? We all know we want to deliver betteroutcomes for less money. We have heard evidence, asa Committee, about the ways that that has beendelivered, and that’s through integrated health andsocial care, better clinical decision making andclinicians working in collaboration rather than incompetition, but also evidence that, in the past, it waswhen we reduced the number of PCTs that we actuallysaw real savings in the NHS.So, looking at all the dangers in this transition, do youhave fears that by going to a much greater number ofsmaller commissioning groups that will distract usfrom those savings, but also that in seeing a rigidseparation between commissioners and providers andless collaboration we are going to lose a great deal?Dr Richard Vautrey: I think there’s a clear balancebetween having systems and consortia that are smallenough to engage the clinicians and the practiceswithin that constituent consortia but, also, havingconsortia or arrangements of consortia that are largeenough and robust enough to be able to cope with thevarious risks and financial challenges and other issuesthat a large organisation is better able to do.I think that is possible through two possible ways.One is to have groups of consortia linked together insome form of federation and they share a commonservice agency or, as the White Paper talks about, alead consortium taking on responsibilities on behalfof the others. There clearly needs to be a workingtogether of smaller organisations.Another model would be to have one large consortiumwhich is then having a very robust locality structureunderneath it that really empowers those local bodiesto drill down to what the local needs of theirpopulations are and to work together through someform of robust locality structure but the statutoryorganisation is the much larger organisation. It couldwork either way in a way that would make sense, butI think you need to have the best of both worlds, ifpossible.

Q124 Dr Wollaston: Do you think that should beentirely locally determined then, coming back to whatyou were saying?Michael Sobanja: I think there’s an issue of balancehere because what I’m not saying is that there shouldnot be accountability or performance management inthe system. I do believe that performance managementshould be focused on equal outcomes for equalneed—not necessarily the same service everywherebut equal outcomes for equal need—and that needs tobe rigorously pursued by the NHS commissioningboard but not in a way that attempts to micro-managethe service that we have seen in the past. So I don’tsee those as being incompatible but I think the trickof pulling this off is to get that balance of behavioursthat energises localities while sticking to a broadtemplate where we have very clear policy directionand priorities at the central level.

I think also, if I may say so, linking that to the PPI,the public involvement approach that your colleagueraised, in my view, the NHS commissioning board andthe Secretary of State need to do a lot more to be openwith the people of this country about the challengeahead for the Health Service, what’s affordable andwho will be making those decisions in the future,otherwise the local groups will be stranded in thatprocess of trying to engage local communities.Dr James Kingsland: Creating GP commissioningconsortia in itself will not manage out the systemfailure at the moment. The main focus is about theupskilling of primary care. That is probably thebiggest challenge within this reform. It’s those8,000 plus micro systems I was talking about andgiving a much better platform and voice to areaswhere there are challenging populations—inner citiesand the vast rurals—and seeing how we can supportthat. If we don’t get into the very units where patientsregister for their care and change the skill mix, theabilities and the system that makes more for patientsand buys less from another sector and then aggregatethat into our consortia—if we don’t get that right—creating just a new body and hoping that will managethe system and somehow an NHS board will deliverand change the current system failures will not work.That is a part of the support system.The biggest challenge, I think, is about theimprovement and upskilling of the primary caresystem, the general practice units.

Q125 Fiona Mactaggart: But how is the systemgoing to do that?Dr James Kingsland: Part of the challenge is to focus,oversimplifying to a point, on what can be made asopposed to being purchased from that unit. That canonly be done by a multidisciplinary team approachacross health and social care and recognising that thechallenges of a patient who registers with a practiceneed far more than just the skills of a generalpractitioner and the nursing team and administration.They need a whole range of healthcare professionalsdelivering an integrated system of care. That meansthe threshold of referring to another sector intohospital is only for very highly technical, complexcare—urgent admissions and operations—but the vastmajority of care is delivered by the general practice.

Q126 Dr Wollaston: But that brings me back to myfirst point, which was that integrated pathwaysundoubtedly make considerable savings and providebetter care. But under our current arrangements, withthat rigid separation, do you see that as a problem—the whole make or buy issue—you can’t make it ifyou’re commissioning it, if you see what I mean?Professor Steve Field: I think, again, it is a transitioninto a more integrated service. First of all, you focuson the patient and you look at health and social care.Look at Torbay, near your constituency, I think. Youhave a very good model there where you can look atlong-term conditions and the chronic sick.We know, from other models abroad, that moving tomore of an integrated model, looking at the hand-offson the pathway for the individual patient, you canactually look at outcomes and improved care, so we




know that happens. But we also need to work verydifferently in that we need to stratify the risk ofpatients within a population and target those patientswho are in and out of hospitals or in care homesgetting poor care and actually put in morepersonalised care packages, if you like, for those.You will need a different work force in primary care.GPs will need to spend longer with patients lookingat the complex, ever-aging patients with multiplemorbidities. We will need to use nurses andpharmacists and others to manage patients in thecommunity in a more rules-based way and we willhave to work very closely with public health toprevent illness. The whole system radically has tochange.But care in Totnes will be very different in how it isprovided to the inner city in Birmingham, perhaps,where we have a lot of people seeking asylum and alot of homeless. We can then target our services muchmore to address the concerns of those than, perhaps,the other groups that you might have where you arean MP. I think you need a much more localisedpersonalised service and this gives us the opportunityto do that.Chair: Andrew George has been extremely patient.

Q127 Andrew George: Thank you. I want to comeback to brass tacks. This is a White Paper that we aretalking about. It is not a parliamentary Act. Therefore,it is an issue for consultation. It seems to me that theGovernment have said to the GP community, “Wouldyou please jump?”, and it seems that your collectiveresponse to that is, “How high?” In my view, youseem to have accepted the basic premise of theGovernment’s approach on this matter.Dr Kingsland was saying a moment ago that clearlythe bottom line and the most important thing isimprovements in the delivery of primary care. Ientirely agree. But the question, really, at the end ofthe day, is about simply allowing primary care to bemanaged by a narrow sectoral interest, for want of abetter expression. The PCTs clearly had failedbecause, in my view, they were too micro-managedfrom the centre; they were puppets with a puppeteerin the centre within the straitjacket of central control.But simply allowing the GPs to take over thatcommissioning role without engaging a widercommunity, I don’t think you are really engaging inthe debate at all. You’re simply accepting theGovernment’s basic premise, are you not?Michael Sobanja: It would be very odd indeed, withan organisation that has espoused clinically-drivencommissioning centred around GPs for 17 years, tooppose that policy when it is actually brought intoreality, perhaps for the first time.I think the question here is exactly as you put it. Butit is not, “How high?” This is the right thing to do.My organisation believes that GP-drivencommissioning is the right thing to do and has donefor a long time. But that is not outside ofaccountability. That’s not suddenly abandoning it andsaying, “We’re going to have 300 to 500 groups”—however many it is—“all doing their own thing,completely unfettered.” This is not liberating GPsfrom all sorts of management. This is about setting

free the energies to actually produce better outcomesfor patients. So I refute the basic premise of whatyou say.Dr Richard Vautrey: Can I add as well that, whilstthe focus of this Committee is on GP commissioning,the White Paper is a lot more than GP commissioningand you will have read, I’m sure, somewhere in theBMA’s response, our serious concerns around a wholerange of issues contained within the White Paper. Wehave big concerns about “Any Willing Provider”. Ihave already mentioned our concerns about theemphasis on competition as opposed to collaboration.We have concerns around the forcing of all hospitalsinto foundation trust status and the arrangementsaround pay and conditions, training and education. Icould go on and on. But I think there are a whole loadof issues that we do need to review very carefullybefore we can actually give any qualified support tothem.Professor Steve Field: We support the policy becauseit is about clinical leadership and what I said right atthe start was that this has to be done with high qualitymanagers supporting, with nurses and with specialistcolleagues. The caveats would be that it is broaderthan just commissioning. We are very worried aboutwhat might happen in education and training becausewe believe that training for primary careprofessionals, nurses and GPs, has not been as goodand as focused as is needed. GP training is woefullyshort. It is still disgraceful. Only 40% of GPs can haveplacements in paediatrics, for example, So at one timewhere we are pushing care into primary care, if thework force don’t take this seriously and improve thequality of training for nurses, for doctors and forothers, then, actually, we won’t have the work forceto deliver what James has quite clearly said is needed.Dr James Kingsland: Could I just say this? Yesterday,in surgery, I was commissioning. I was consciousabout it. Some colleagues aren’t. It was called areferral. But I did a needs assessment. I needed a wisecounsellor, a consultant colleague, at this particulartime and secured a service against it—

Q128 Andrew George: For an individual patient?Dr James Kingsland: For an individual patient. Butthat is the bit that general practice really wants to getinvolved in.At the moment I have a system that has designed apathway on my behalf, has spent the money on mybehalf and I have had little say in the pathway. ButI am still making the commissioning decision. I amspending the public purse. I call it an FP10, aprescription. So I’m doing it anyway. Some colleaguesaren’t conscious that they are doing it. If we are giventhe tools to do it I think we would make betterdecisions and probably design different pathways thatare being designed on our behalf.

Q129 Andrew George: So GPs know best? In termsof the shape of the service, not just the individuallycommissioned patient service but in terms of theshape of the service, GPs know best? It is best not forthem to work in partnership with others?Dr James Kingsland: Not at all.




Dr Richard Vautrey: Absolutely not. I think whatwe—

Q130 Andrew George: Let’s hear more of that, then.Dr Richard Vautrey: What I have said repeatedlytoday is that GPs have to work in collaboration, andnot just with their other medical colleagues or theirconsultant colleagues. Public health colleagues willplay a crucial role in making wise decisions but, also,other healthcare professionals and, indeed, patientgroups as well have to be all round the table makingthese decisions jointly together. What GPs are good atis working in teams and working as amultidisciplinary team.What they have been so concerned about, over the lastfew years, is the team that have been around them,their district nurses, their health visitors, even socialcare workers, have been removed and become moredistant. They are very good at working in teams,embracing everybody as part of that team, and theywant to replicate that on a bigger scale when it comesto commissioning.Chair: I am conscious that we are running out oftime, because we have another group of witnesseswho are on after you, gentlemen. Fiona wants to comein and then Chris Skidmore wants to ask a specific setof questions.

Q131 Fiona Mactaggart: The vision of a kind ofcomprehensive primary care service that you allmention seems to me not to be properly reflected inthe White Paper. The NHS board is going tocommission primary care and is it going tocommission the kind of primary care that you want? Idon’t understand this nationalised commissioning of aprimary care service. I don’t understand thenationalised commissioning of maternity services. Iwould like you to explain how that is going to makethings better.Michael Sobanja: On maternity services, can I justsay that our view is that that is bonkers.

Q132 Fiona Mactaggart: Yes. Mine too. Good. I’mglad you agree. Keep going.Michael Sobanja: Just to deal with that, from mypoint of view, get it locally.Chair: Rather than have four people say it is bonkers,if everybody consents, we can move on.

Q133 Fiona Mactaggart: Okay. You all think it’sbonkers and I’m very glad. Keep going. I want toknow about the primary care service.Michael Sobanja: I think there’s a difficult trick topull here because the alternative would be to say thatthe primary care services, GP services, communitypharmacy, etcetera, should be commissioned bygeneral practice commissioning consortia. That wouldbe an interesting model.I think our view is that we need to allow thoseconsortia to mature, they need to be very collegiatein the beginning and if you were suggesting that thecontracts for primary care, and GPs in particular,should be held by the consortia in the early days wewouldn’t support that for the reason I have just given.It may change over time.

But you also raise another point, if I may. The WhitePaper is short of detail on many things. In particular,the role, functions and behaviour of the NHScommissioning board it is particularly short in and wehave had difficulty in responding to that balance that Idescribed before because we don’t know what they’regoing to do and how they’re going to do it.

Q134 Chair: There is a specific question here, isn’tthere, perhaps for Dr Vautrey, though others may wishto comment, that the implication of the move tocommissioning primary care through thecommissioning board is a move back to a singlemodel of the delivery of primary care defined by acontract negotiated between the commissioning boardand your committee? I wondered whether that issomething you were seeking.Dr Richard Vautrey: We have long advocated thebenefits of having a single contract. It is how we getthere and in a way that doesn’t destabilise existingpractices. This is the key thing.

Q135 Chair: But it is slightly odd, isn’t it, toadvocate a single contract for primary care and localcommissioning for secondary and community careservices?Dr Richard Vautrey: But I would agree with whatMichael was saying. I think you can hold the contractnationally but then you can devolve theresponsibilities for performance management andoverseeing that contract—appraisal, revalidation—torobust organisations that have the ability to deal withthe conflicts of interest and other areas of concern. Ithink it is possible to do that.

Q136 Rosie Cooper: Where are they coming from?Dr Richard Vautrey: But they would have to do thatover time.

Q137 Fiona Mactaggart: Where are they?

Q138 Rosie Cooper: Yes, where are they? Where arethey coming from? You are going to giveaccountability to local authorities who—Chair: No. We are back on to that again. Chris.

Q139 Chris Skidmore: I would like to move on tothe process of effective commissioning and, inparticular, the resource allocation necessary to do this.My question is really around the maximummanagement allowance outlined in the White Paper.Obviously that is set against the backdrop of a 45%reduction in management costs. The value of thatMMA, let’s call it, is yet to be determined—I think inDecember. There was a report in the Health ServiceJournal in August that this would be around £9 perpatient. Sir David Nicholson came on 12 October andsaid, “Well, let’s see” and was very unwilling to givea precise figure.But I was interested in your view. What would be aneffective figure for the MMA? £9, obviously, is fartoo low.Dr Richard Vautrey: I think it is completelypredicated on what the organisations have got to do—what they’ve got to deliver. One of the reasons why




consortia are unsure about their structuralarrangements at the moment is they are not sure whatcan be afforded. What is clear is they can’t simplyreplicate what PCTs do now.One of the keys to the whole of this reform is that theDepartment needs to change the way that it acts andwhat it expects of their local organisations, because ifwhat happened in the past happens in the future,where diktat comes from the Department of Health,you’ve got to fill in this form, you’ve got to producethat report, you’ve got to tick these boxes, and moreand more of the bureaucracy wheel starts to go roundand round again, that’s going to be a major problemand will be undeliverable based on the sorts of sumsthat are being talked about that GP consortia will haveto run on. So I think it is really predicated on whatconsortia can stop doing that PCTs currently do toactually make these reforms affordable.Professor Steve Field: The issue, then, is where youdo things at different levels in the system. Even now,we have very good cancer networks looking atcommissioning tertiary cancer work. You will see, Ithink, networks either of the consortia or of theconsortia linked through to secondary care, like now,at some levels. So you will cut down to practice levelfor some commissioning. As James said, you canactually go down to the individual patient. But it iswhere you do the different bits of commissioning andthe design of the service.Going back to the arguments over provision andcommissioning, of course, we have been promoting,very strongly, this idea of federated practices workingtogether to provide care across a locality so that youcan maximise access and you can look at havingdifferent services. That helps with your governancequestion in that you can commission from then afederation of practices rather than from your ownpractice. I think that will be one way which will aidtransparency. But, again, it is where you do things inthe system and how big it is.

Q140 Chris Skidmore: So, effectively, do you agree,it would be far more effective if a consortiumthemselves were allowed to decide, within their ownset budget, what the management allowance was?Dr James Kingsland: Yes, our difficulty is that if youset a cost per head it doesn’t necessarily reflect thenecessary or legitimate costs of re-designing a service.Part of a re-design—a business case to change aservice—inherently will have some managementcosts. It is then to say, is it affordable from withinyour commissioning budget, which is a better way, Ithink, of looking at what are the necessary resourcesto re-design a service rather than just saying, “You’vegot £5, £10 or £15 a head”, which doesn’t reflect thedetail that you will need in terms of clinical time andmanagement time. It will be different costs dependingon what service you are re-designing.Professor Steve Field: Commissioning might well bevery different. We have already seen some of the thirdsector organisations—charities—helping by looking atguidelines for commissioning. I think you will seemuch more involvement of third sector and localgovernment in some of those decisions.

Then it is a question of what you do. I think the future,then, is very exciting because you can start to look atdifferent models of care, as we said earlier on, lookingat more integrated care across social care and theninto secondary care.Chair: One tiny one, I am told, from Rosie and thena final set of questions from Nadine, who wants tocome back to “Any Willing Provider”.

Q141 Rosie Cooper: How would you react if I saidto you that some GPs in my patch currently, whilstdiscussing a change in the way services are beingdelivered at a local hospital—the very thing you aretalking about—have actually said, “But you must takeinto account that we are actually small businesses andif you want us to attend that meeting the hospitalshould pay for our time”? How do you react to that?Dr Richard Vautrey: I think we need to recognise thatif I get involved in commissioning then somebody hasstill got to see my patients. So I still need the resourceto be able to pay for a locum or other doctors withinthe practice to do more work, to take on more time,to be able to do that. So there is a cost. What we arenot asking for is more money to do it in addition towhat we would get paid anyway. But this is money toensure that patient services continue. Very few GPswill get directly involved in management functions,but if they are removed from the practice then theircore function within the practice needs to continue.Professor Steve Field: Two points on that, because itis a really important issue. In my past life as aPostgraduate Dean, I had this all the time. It was easyto get hospital consultants to go to meetings becausethe hospitals let them out. The reason our exam is soexpensive is that we have to pay locum fees for peoplewho are not providing care in their practice to comeand do the examination, whereas the hospitals letpeople out. But it is a real cost to the hospitals.Actually, if people were transparent about the cost ofspecialists and managers’ time as well as GPs it wouldbe easier. However, I think 43% of GPs now arelocums and salaried. Our younger doctors are tellingus, in our response, that they want to be engaged incommissioning. Actually, many of them wanted to beengaged in PCTs as well. But if you don’t pay themto go, they are not earning at all. They feeldisenfranchised at the moment and the challenge,actually, is for us in the profession to get these young,enthusiastic doctors engaged. Unfortunately, it costsmoney. But you mustn’t forget that it costs hospitalsmoney when consultants do things as well.Rosie Cooper: Absolutely, but we need to deal withthe benefit to the patient.

Q142 Nadine Dorries: Dr Vautrey, over recent yearsthe Government and Department of Health have hadmany occasions on which they have had to revert tothe independent sector to provide care on a number oflevels. Have you had any issues with that? Can youcite any cases where you and the BMA have beenunhappy with that or do you think it has been largelysuccessful?Dr Richard Vautrey: I think we have produced a lotof evidence to question the value-for-money ofindependent sector treatments, centre programmes and




a raft of other policies. The GP-led health centres thatProfessor Lord Darzi was initiating, whilst they mayhave been good in one or two areas, in the vastmajority of areas have turned out to be whiteelephants because they weren’t necessarily needed.They were imposed from above.I think what we need to be careful of is that, with the“Any Willing Provider” model that is being promotedat the moment, we don’t replicate some of theproblems, with smaller organisations cherry-pickingthe easier things to do, leaving the NHS to actuallypick up the more complex and challenging and costlyareas of work. That isn’t what local patients want.They want a comprehensive local service.

Q143 Nadine Dorries: Is that the basis, then, foryour concerns and the BMA’s worries about moreindependent sector providers coming into the sector?Is that the basis of your worries?Dr Richard Vautrey: Yes. I think we worry that thereis going to be increased fragmentation so there isgoing to be increased complexity, leaving manypatients confused about where they can get servicesfrom.We also need to remember that, increasingly, many ofthe patients who access secondary care services haveco-morbidities; they have more than one condition. Torefer to one particular provider who is providing oneparticular service that is not able to provide thecomprehensive range of services, you end up withpeople being excluded. So we have seen someorganisations that would not accept people for quitestraightforward operations—

Q144 Nadine Dorries: I am sorry, when you say“organisations”, can you qualify what you mean?Dr Richard Vautrey: Private hospitals and a varietyof organisations that have set particular criteria thatthey wouldn’t accept people over a certain age or theywouldn’t accept people with other co-morbiditiesbecause they didn’t have an intensive care unit ifthings went wrong or they weren’t prepared to takethe risks if that particular procedure went wrong. Theythen left those particular patients with no choicebecause they had to go to the local service whilstothers were being cherry-picked to go to the privateorganisations that were being set up.

Q145 Chair: Could we have a view from one of theother witnesses?Michael Sobanja: I was just going to comment that Iagree there have been deficiencies in that area in thepast but I think you need to separate out the ideologyfrom the practicalities of the approach.We would come at it from the point of view of sayingthat the provider market may require some stimulusby the involvement of the independent sector. Thefailures that Richard has just pointed out, in my view,are failures in commissioning—inappropriatespecification, inappropriate management of contract,inappropriate negotiation of contract with regard tothe independent sector treatment centres. That is whyI look forward to this arrangement producing robustcommissioning, which should mean that services are

patient-led and not dictated to by providers of anytype.

Q146 Nadine Dorries: Could I ask, then, do youthink there is a conflict of interest? The BMA doesn’tmind GP members being independent contractors butit is voicing concerns about others being so. Do youthink there is a slight conflict there?Dr Richard Vautrey: No, I don’t think so becausemany of the doctors, if not all of the doctors, whowork within independent sector private hospitals areBMA members. We represent them, too.

Q147 Nadine Dorries: So it’s okay for the doctors,just not anybody else?Dr Richard Vautrey: No. We are wanting to ensurethat we have a comprehensive service and that wedon’t have a fragmented, overly bureaucratic andcostly service that doesn’t deliver value for money.

Q148 Nadine Dorries: Professor Field, did you wantto come in on that?Professor Steve Field: The first thing to say, from theCollege’s perspective, is that a number of ourmembers, including my successor, have spoken outwith concern about private industry coming intohealthcare.My personal view is very similar to Mike’s. Thecommissioning arrangements are the key. We alreadyknow that, for example, Turning Point, which is a not-for-profit organisation, are providing drugs andsubstance misuse support in a number of areas in thiscountry already and the Priory Hospital Group areproviding care particularly for anorexic young peoplein many areas as well.I would like to see a comprehensive local service butI think there are opportunities. For example, we couldbe leading to a better end-of-life care provision byworking closer with Marie Curie and Macmillan.Rather than lots of people dying in hospitalunnecessarily, we could create a new system—

Q149 Nadine Dorries: Is it, then, that you don’tmind social enterprises—it is just the for-profitorganisations you are objecting to?Professor Steve Field: I am more comfortable withsocial enterprises. However, if it is about providinghigh-quality care, and you can set the commissioningor the design of the service then I, personally, havemore of an open mind about what the service shouldbe there to provide. That isn’t, actually, the view thatthe College currently has. That’s a personal view.

Q150 Nadine Dorries: So if the commissioning isstructured in such a way which allows anybody to bidfor that business, then, as long as the commissioningis right and the criteria are right and everybody knowswhat they are asking for and what they are purchasing,you have no objection to that?Dr Richard Vautrey: I think there are problemsinherent within the White Paper, as I have mentioneda number of times now, about the balance betweencompetition and collaboration. What we would want




to see is that the systems going forward don’t preventmeaningful collaborations with local organisations—with my local hospital down the road. I want to beable to work with those consultants. That’s where themajority of my patients want to go.What I don’t want to find is Monitor or otherorganisations suddenly jumping up and saying,“That’s anti-competitive,” you can’t work in asensible, collaborative way that your patients wouldwant, you have got to involve everybody or keep adistance from them and you end up with a plethoraand complexity—

Q151 Nadine Dorries: Yes, but I’m getting animpression from you that what you would want to dois always to go there as the first choice, as your firstchoice, before you look to any other option rather thanasking your patient where they would want to go. I’mkind of getting the feeling that you want that to bethe default position and if that position fails then goelsewhere, which may include independent sectorproviders. I’m getting the feeling you are taking thatfrom the doctor’s perspective rather than thepatient’s perspective.Dr Richard Vautrey: No, I’m not—

Q152 Nadine Dorries: What if the patient said,“Actually, I don’t want to go there. I want to go toanother provider”?Dr Richard Vautrey: My patients consistently saythey want a good-quality local service that iscomprehensive and meets their needs. Clearly, if thatservice doesn’t provide their needs, then there will beother services who I may be able to refer to.

Q153 Nadine Dorries: Yes, but they don’t know if itmeets their needs until they have tried and tested thesystem. In the first instance, it is going to be you whois referring or directing them to that service.


Witnesses: Dr Paul Charlson, GP, Hull, Dr Peter Davies, GP, Halifax, Dr Kambiz Boomla, GP, TowerHamlets, and Dr Jonathon Tomlinson, GP, Hackney, gave evidence.

Q155 Chair: Gentlemen, thank you very much forcoming this morning and for waiting patiently as thefour previous witnesses gave their evidence. Could Iask you, briefly, to introduce yourselves and say acouple of sentences about where you are coming fromand the basis on which you are here. Dr Charlson,would you like to start?Dr Paul Charlson: I am Paul Charlson. I am asessional GP now in Hull and I am also a localMedical Director of a Darzi centre in Grimsby. I waspreviously a full-time partner in a big dispensingpractice in rural East Yorkshire, and I also work as aGP with special interest in dermatology, both for aprivate provider and an NHS provider. So I have anoverview of a lot of different things that you havebeen talking about.Dr Peter Davies: Hello there. My name is Dr PeterDavies. I’m a GP partner in a big practice in Halifax.I also think a lot about the NHS and write a lot. I have

Dr Richard Vautrey: No. I think any referral has tobe a joint decision between the patient and the doctor.The idea that “the doctor knows best” is long gone.The idea that the doctor will sit with the patient andthey will decide between themselves where the bestplace for that referral to be made is how that jointdecision making takes place within everyconsultation.Dr James Kingsland: Could I add just one point onAWP? AWPs have got to be good for patients. I waspart of a team who first described it. The process—you used the word “bidding”—was to get away fromany bidding or tendering. An organisation that meetsthe standards of the NHS to increase capacity shouldbe welcomed. I think where we got in trouble was theISTC programme which guaranteed cost and volumein contracts, and that can’t continue. But the AWPprocess, as a principle, has got to be good for patientsin terms of increasing choice and capacity.

Q154 Grahame M. Morris: But is there an issuethen of undermining existing providers, even if thoseproviders are part of a natural monopoly? If you hada plethora of smaller providers providing a much morelimited range of services, wouldn’t that be bad interms of the long-term stability of the NHS?Dr Richard Vautrey: I would agree. I think there isalso a big issue about training and education becauseif you cherry-picked elements of care and removedthem from the main local provider where the mainbulk of training takes place, then young doctors willnot get exposure to those sorts of episodes of care,and that will be to the detriment of us all long-term.Chair: I think at that point I am going to have to drawthis session to a close because we have four morewitnesses who are waiting, I guess increasinglyimpatiently, behind you. Thank you very much indeedfor coming this morning and for covering aconsiderable amount of ground.

done some writing with Civitas and, in the references,my book Putting Patients Last was my “son” for thelast year. So, yes, I have a lot of interest in all this.Dr Kambiz Boomla: My name is Kambiz Boomla. Iam a GP in Tower Hamlets, which I think is creditedas being one of the PCTs that has done quite wellduring the last regime. I chair City and East London’sLocal Medical Committee, which is the GPs’representative body.Until very recently, I was on the practice-basedcommissioning executive in Tower Hamlets but Istood down from that very recently.I also chair the PCT’s ICT Committee which has beenresponsible for rolling out an integrated generalpractice and community health service’s record, whichwe think is in the process of helping to transform care.I also work as a senior lecturer in the Department ofGeneral Practice at Queen Mary.



2 November 2010 Dr Paul Charlson, Dr Peter Davies, Dr Kambiz Boomla and Dr Jonathon Tomlinson

Dr Jonathon Tomlinson: I am Jonathon Tomlinson. Iam a GP in Hackney, in East London. I have workedin hospitals and primary care in East London over thelast 15 years. I have experience working in vulnerablecommunities in Afghanistan and Nepal and a degreein Global Ethics, which is another interest I have. Iam a GP tutor as well and I have been working withthe campaign group Keep Our NHS Public for the lastthree years.

Q156 Chair: Thank you very much. I would like, ifI may, to open the questioning by asking each of youthe same question that I asked the previous group ofwitnesses, which was to link what I describe as theNicholson challenge—the efficiency gain associatedwith the search for £15 billion to £20 billion ofefficiency savings in order to allow the NHS to deliverthe budget that was set out in the ComprehensiveSpending Review—with the challenge ofimplementing the White Paper proposals and to askyou how you react to that challenge.The previous witnesses, as you will have heard,stressed the importance, if the efficiency gain is to bedelivered, of engaging the clinical community in themanagement and the delivery of that efficiency gain.Is that a perspective that you share? Do you think thatthat is the right answer to the question that is implicitin the position that the Government and the NHSmanagement now find themselves in?Dr Paul Charlson: I think it is all about releasinginnovation. That’s the real way to make savings.People who have got a stake in managing budgets aremuch more likely to want to innovate and makesavings. I think that is the absolute key thing about theWhite Paper and commissioning. It is about gettingstakeholders involved and making sure that they canreally innovate and re-design services.A typical example of the kind of thing that ishappening is this. Say you go to the hospital forhaemorrhoid banding, which is a common thing thathappens. It costs £600. You can do it for about £20 ingeneral practice. Obviously, there are on-costs on thatbut you can save a huge amount of money. So thereis a great incentive, if you are commissioning andproviding services, to innovate. I think it is all aboutthe release of innovation and people having a stake inthat because you are much more, in a way, spendingyour money rather than feeling it is an amorphousthing. That is what I feel is the key issue—one ofmany, obviously.Dr Peter Davies: I am going to echo Paul on that.How do I see it? Just looking at the total NHS budgetof roughly £100 billion a year and saying, “We’regoing to take that down to £80 billion”, even if wecan do that over four years, it is still £5 billion a year,which seems a huge amount to take out of the system.If we are going to get anything to work, I think—atthe moment, as a doctor, I sit there in my consultingroom and do lots of referrals, hopefully in consultationwith the patient and this is probably the best place forthe patient to go. But, at the end of the day, I send abill for that to the PCT which they then have to pay.In fact, once these new commissioning consortia cometogether the doctors and the PCT managers, or thenew commissioning managers, are going to have to

work hugely together. I think bringing the economicand the clinical perspectives together actually gives ussome chance.Dr Kambiz Boomla: I suppose I take a different view.I think that if you were going to do this you wouldn’tstart off with the economic position that we have gotnow. We are setting up new bodies which I think arebeing set up to fail, in a way.Let’s imagine that we had a 5% improvement in ourefficiency. My fear is that the public spending cutsthat will impact, particularly, on social services andwill, therefore, impact on healthcare provision willmean that we will be running to keep up with wherewe are now.I look at the experience that we have had in our GPpractice-based commissioning group. We were able tomake quite large improvements on the quality of ouroutpatient referrals, but where we always struggledwas to deal with unscheduled care, people turning upin A&E, getting admitted to hospital as emergencies,things that GPs felt they had very little control over.In order to get control over those sorts of things, youneed much larger whole system reform, which reallyrequired a body that would stand above the sectionalinterests of general practitioners—and I am a generalpractitioner—and would be able to engineer a totalsystem reform of the local health economy. My worryis that GP commissioning groups aren’t really goingto be quite in the right position to do that.I appreciate lots of things that the previous panel said.Lots of steps could be taken to ameliorate thatposition, bringing in lots of patient involvement,working closely with public health and bringing inlots of different stakeholders on to our GPcommissioning board. But then, I think, one is endingup by re-creating an organisation which I was actuallya great fan of, which was the old Primary Care Group,where we actually did have much larger GPinvolvement in commissioning but it wasn’t seen asprimarily or exclusively a GP-focused activity.Dr Jonathon Tomlinson: In my memorandum ofevidence I think I started off by saying that I felt thechallenge for any system of universal healthcare is toprovide that care according to need so that the peoplewho need the most healthcare receive the mosthealthcare and that the healthcare they receive isappropriate. I believe if that is your aim then you willcreate efficiencies that way, although of course youcan provide healthcare that people need that is notnecessarily efficient. For example, the time that Ispend explaining to somebody about the consequencesof their diagnosis of cancer or talking somebodythrough a bereavement can never really be measuredin classical economic efficiency. Certainly, if you aretreating somebody you don’t want to over-investigatethem or over-treat them. You can save a lot of moneyif there were better distribution to clinicians and theymade better use of NICE’s recommendations.We know that doctors, sadly, are very poor atfollowing best evidence. An analysis of commonconditions shows—and as a doctor I have to standhere and I am guilty as well—that perhaps doctorsfollow recommended guidelines only 20% to 60% ofthe time for very common conditions. If we could usethe information that we already have about how best




to treat our patients not only would they be a lothealthier but we would save a lot of money.Of course I think it is important not to muddleefficiency with giving patients what they need. Youcan screen a population who are at low risk veryefficiently and make a lot of money. It doesn’t meanthat that is what they need. You could distributeViagra very cheaply by having a website. That’s notnecessarily what patients need. What we do know isthat patients with conditions that are complex andenduring need a relationship with a doctor. I don’tthink that is something that can be measured bysimple efficiency savings. I think that is somethingthat is really threatened by a focus on efficiency ratherthan a focus on distributing healthcare according toclinical need.

Q157 Chair: I understand what you are arguing, butthe challenge is that, against the background ofresource constraints, unless there is a willingness toaddress what Dr Boomla described as “systemchange”, there is a danger that people are simplysqueezed out because they are at the back of the queuerather than because there is a conscious clinical choicebased on priorities.Dr Peter Davies: If I may say, whatever the economicclimate of the country, NHS resources are alwaysconfined. There is a finite amount of money that thecountry can afford to spend on healthcare needs. Asdoctors, we can think of enough tests and enoughthings to keep patients busy and entertained for many,many years. To some extent the Government actuallyneed to restrain our enthusiasm and in fact it isprobably better to do that.

Q158 Fiona Mactaggart: Isn’t it better if you do itrather than the Government do it?Dr Peter Davies: It depends. If I have time on myhands I can invent new diseases for people to catch.There is almost an element that, in fact, you getsupply-induced demand and you get demand-inducedsupply across the NHS. Actually, there comes anelement that, in fact, if you are dealing with, say,casualty and you are trying to get through the patientsquickly, you will do what’s needed at the time to dealwith them when the Casualty Department is full. Ifyou have got a nice big empty clinic you will findsomething to do with it.Dr Paul Charlson: On the other hand, if you get alittle bit more time with the patient often it doesactually save you money. I can think of lots of timeswhen, in a rush, you will do something. Often, youwill actually do a test or something because it justbuys time. So that costs money. Similarly, with thingslike dermatology, which I am very much involved in,if you actually explain to the patients how to use theright medication they don’t bin it and go and seesomeone else; they actually use it properly and theyget better. So I think a lot of it is about releasing timeand working efficiently. That is about using otherpeople in the healthcare team, so that is a little re-design.The other thing, which I didn’t hear much about inthe last evidence, is really about patients taking a lotmore responsibility and getting real, too. Getting

patients involved is really important so they actuallyget some concept of what costs are and what the issuesare around costs because, as you say, there is not anunlimited pot. There are always going to be restraints.It is just how to use those resources best. I think thatis how I would see it.

Q159 Fiona Mactaggart: I am really interested inthis thing about patients. My constituents think,“Here’s my poor health doctor.” They really do thinkthat and, actually, when I try and get them to do thingslike—we have a very high level of heart disease inSlough—keeping active after their first MI and so onthey think, “Oh no, I’m going to die if I walkanywhere. I’m going to stay on the sofa for the restof my life.” I think it is really hard with certainpopulations to help them to take power over theirown health.I think that our whole society, and I am not actuallyblaming doctors for this, is really bad at helpingpeople take responsibility for their own health. I don’tsee anything in this White Paper which is going tohelp with that and I would not be uninterested if anyof you have got a good idea about how it can beachieved because, certainly, in terms of improving thequality of the Health Service, however it wasstructured, it would be a good thing to do.Dr Kambiz Boomla: Can I come up with an examplethat we have done in Tower Hamlets, which is ourprimary care investment programme? The PCT tookthe decision, because we were a resource-gaining areabecause of our deprivation—under the lastGovernment we did have money to invest—that as faras possible that money would be invested in primarycare rather than adding to the hospital bill.We chose diabetes and childhood immunisations asbeing the two areas that that investment would be in.That demanded a very close collaborative approachbetween the GPs, the hospital consultants and theother staff—the sort of thing that Dr Richard Vautreywas talking about earlier on where work is donecollaboratively. As a result of that and as a result ofinvesting in the networks of practices that Steve Fieldwas talking about, we produced quite a massivechange in the way that patients also thought abouttheir diabetes. It is a different example to your heartdisease. For example—I think you will be able to seethis—the proportion of patients who now have a careplan for their diabetes in Tower Hamlets has risenfrom 10% or 15% at the bottom to about 64% now,which I think is quite a shift.On childhood immunisations, here the graph isslightly deceptive. We have risen from 84%—

Q160 Chair: We are trying to take a verbatim note.Could you simply tell us the numbers?Dr Kambiz Boomla: The thing has gone upenormously. Collaborative working across theprimary-secondary care sector has resulted in the sortof system change that I was talking about. But if wehad Monitor coming in and telling us that we werenot allowed to talk to our local provider unless wetalked to “Any Willing Provider”, we wouldn’t be ableto make those shifts and we wouldn’t be able to makethe whole system reform that I was talking about.




Q161 Chair: Can I just probe that for a second? Iunderstand why stable pathways of care are necessaryto secure good-value, high-quality care. But beforeyou commit to a stable pathway system what is theobjection to considering what alternatives might beavailable? “Any Willing Provider” isn’t the samething as “Any Willing Provider on a spot marketbasis”. You can make a considered choice for a periodof time, it seems to me, having considered thealternatives. What’s wrong with that?Dr Kambiz Boomla: I am not saying that all statemonopoly providers have a God-given right to holdtheir contracts. What I am saying is that, in our area,we have a lot of very experienced clinicians who havegiven up a very large amount of their time todeveloping and improving the care that they offer theirpatients. Once you move to a system of five-yearrenewable contracts, which the “Any WillingProvider” model tends to move towards, you end up—let me give you one example in primary care. A verylarge multinational company won the contract to runa particular practice in Tower Hamlets and theturnover of the salaried GPs within that practice hasbeen enormous with no continuity of care happeningin that practice. Contrary to what the PCT wasexpecting, that practice has dropped to the verybottom of the balance scorecard in Tower Hamlets.The danger is that the organisations themselves will,in my view, retreat into a financial bunker where theydo not want to share their knowledge and the waythat they have reformed their care pathways with otherproviders, because they see that that is taking awaytheir competitive advantage when it comes to contractrenewal. So, rather than having a collaborativeapproach to healthcare, you end up with the balanceshifting to competition rather than collaboration.Where that may work well when you go to buy yourholiday, I don’t think it works well in healthcare.

Q162 Chair: Dr Charlson was shaking his head.Dr Paul Charlson: I don’t agree with you, really,because I’ve seen the opposite happening. I have seenmy local hospital trust really being incredibly anti-competitive and charging and gaming quite a lot. Ithink you do need competition in healthcare to raisestandards and prevent partner gaming which I think isgoing on. So I don’t agree. I agree you need stableand collaborative working but I don’t think,necessarily, you need one provider to do that. I thinkpatients do deserve some choice. They may notnecessarily want to go to their local hospital. I knowthat quite a lot of times they do but they may want tochoose to go somewhere else which gives them ashorter waiting list, better opening times, betterquality care. That happens and I think competition isimportant for that. I don’t think you want a Wild West.I think that would be worrying. But I think you wanthigh-quality care. Patients don’t care who provides itas long as it is good quality and they are not payingfor it. I think that is the thing and it is what they want.

Q163 Valerie Vaz: I am not sure that’s right. I thinkpatients do want to go to a very good local hospital.Maybe it is slightly different for you in your specialty,

but there are certain illness, diseases and conditionsthat don’t need just some cream and off you go.Dr Paul Charlson: No, I’m not just talking aboutdermatology. I am talking about a lot of conditionsthat can be managed much more conveniently locally.Certainly there are a lot of outpatient functions thathappen in hospitals that certainly don’t need to happenas they do because they are very expensive, difficultto park for patients, not easy, poor appointmentsystems and all that stuff. But it doesn’t necessarilymean a local hospital either. It may be a fairly localhospital which is better for that particular sort of care.Of course, some bits of care do have to happen in aspecialist centre—we know that—but not as much asit does at the moment.

Q164 Fiona Mactaggart: One of the things that Iwas hearing from the previous panel was thesuggestion that a clinician-led commissioning systemcould mean that secondary care is brought more undercontrol. I am just putting it rather crudely. I think thatis what you are saying and I think Dr Boomla wasalso saying that in a way and wasn’t saying that youjust need one place. There does not necessarily needto be a monopoly but there does need to berelationships. I think that I think, listening toeveryone, that, if there is something to be said for GP-led commissioning, it is to do with clinicalrelationships between primary care physicians andsecondary care physicians being able, hopefully, tomigrate more care into primary care. Actually, patientsprefer it although they think that the hospital doctor isprobably better than you lot, for no particularly goodreason, but they do sort of think that. But if it can bedone quickly in the local GP practice and you can gethome and look after your kids, “Whoo, great.” So Iam wondering, if it is about relationships, then if it isall going round purchasing, how do you sustain therelationships?Dr Peter Davies: There is already a purchasingrelationship going on.

Q165 Fiona Mactaggart: Yes, I know. It is verymanaged at the moment.Dr Peter Davies: Yes, but there is, actually, a set ofdefault decisions built into the current system. This isactually a balance which has altered. If I go back to,say, when my dad was a doctor 40 or 50 years ago aGP couldn’t get a full blood count done. That washighly specialised. He sent you to the hospital. So youend up with a hospital that has all the investigationsand x-rays and a GP has, basically, just his clinicalwits.I am sitting as a GP now and I can now order all myblood tests, pretty well every x-ray I want and everyscan I want. There are about 10 very specialised oneswhich you would only do if you were a second-linespecialist anyway. But, other than that, I can orderpretty well any investigation I want. I am also nowgetting the results back to me quickly. So, in fact, thepotential to do more in primary care is there. Thisdefault that there are lots of patients on reviews in thehospital clinic and people going through that, actually,maybe doesn’t need to be there any more.




One of the things in fact—you can speak to PCT chiefexecs about it—is that they will say, “I’m in bed withan elephant. This hospital is hoovering money up bypayment by results”, and, “How do I shift some ofthis lot back to primary care?”In fact, for a lot of the outpatient follow-up, which isroutine, and where the disease is controlled anddiagnosed and we know what we are doing with it,most of the routine management could actually bedone in primary care. Then, in fact, when we use thehospital we can use it much more for, “There’s a newillness here. We need a new diagnosis. This illness hasgot worse. We need some specialised treatment on it.”That would actually take it. But a lot of the routinestuff for the hospital just doing follow-up could bemoved out to primary care.I suspect our information systems these days inprimary care are streets ahead of the hospital, apartfrom digital imaging which a hospital is good at. Wecould, actually, do quite a lot with that. There ispotential to move quite a lot to us.

Q166 Chair: Just before you come in, does DrTomlinson agree with that view from Dr Davies?Dr Jonathon Tomlinson: I do, but I think that is acompletely different issue. I don’t think it hasanything to do with competition and markets andmultiple providers.We have to look at what evidence we have. Certainlypatients are more satisfied having their blood tests inprimary care. There is evidence of cost in acompetitive environment. On the recent review ofhealthcare in the States, they said there that the singlereason for the high cost, which is two and a half timesper head of population—that is what the Governmentspend on it in the United States—was that it is theonly healthcare system in the world that is so muchowned by investors that medical care has become acommodity rather than a right. That is reallyimportant. It is terribly expensive to run a market inhealthcare. It is very cheap to do things in primarycare. I have no problems with that. We do everythingwe possibly can in my own surgery.I don’t believe that it is in patients’ interests to havelots of people competing to do your blood test. Whydo not all of my patients have it in my surgery? Whyhave somebody open up, next door, for instance,saying, “Blood tests. Come here and get them doneeven quicker than Dr Tomlinson”? What’s the pointof that?Dr Paul Charlson: It is innovation. That’s the point.It is encouraging innovation. That’s what you needbecause that’s why we have been stuck—no, we do—

Q167 Valerie Vaz: We just want a blood test.Dr Paul Charlson: Okay, but the fact is we have beenstuck, for years and years and years, not being able toinnovate. I am a real innovator and I have beenincredibly frustrated by the restraint of what we haveat the moment. We just cannot innovate and providebetter services for patients. That’s what it is about.

Q168 Fiona Mactaggart: Dr Boomla has describedto us how he has innovated in the present system.

Dr Paul Charlson: Okay, but that is one example. Onthe whole, if you talk to most people, that isn’t thecase. We haven’t been able to innovate anywhere nearto the extent that we need to. And that is what it isabout. It is releasing innovation.Grahame M. Morris: Can I have a question opposingthis, Chair? Thanks very much.Chair: What that is illustrating, Grahame, is thatdisagreements aren’t confined to the political world.

Q169 Grahame M. Morris: Absolutely. But on thisbig picture I am interested in your views onmaintaining the stability, in the long term, of the NHS,and also if perhaps you could elaborate on your viewson the introduction of this internal market approachin the NHS. I can think of some practical examples.Obviously I have common cause with our colleaguesfrom Tower Hamlets and Hackney, representingEasington, an area of high deprivation. We have hadsome excellent examples of innovation in terms of ourCOPD pilot which was nationally recognised. So Ithink there is scope on the existing arrangements torecognise innovation.But I want, particularly, to come back to your issuesabout commissioning and how it would beadvantageous to patients and in terms of efficiencyand value for money. I can’t quite understand how the8,230 micro commissioning units that Dr Kingslandreferred to in his earlier evidence can be any moreefficient in terms of sustaining the service and inproviding value for money than 150 Primary CareTrusts that we have at the moment. I would beinterested in your views on that.I am also concerned, having talked to people in thehospital sector, about the instability that may beintroduced. Dr Charlson referred to an example of aparticular procedure that could be done moreeconomically at lower cost in a primary careenvironment. The example that was given to me wasif, for just cause, it seems a good idea for primarycare to transfer something like x-ray screening into aprimary setting. A relatively small transfer mayundermine the financial stability of a large generalhospital because they are operating on the margins. Itmay undermine the whole basis of the healtheconomy.Why don’t we, without a firm evidence base, look ata larger-scale pilot and evaluate that and see what theimpact would be on local health economies before weroll out a whole national programme? I would beinterested in your views on those points.Dr Peter Davies: It is strange. In medicine and,particularly, in surgery we have moved ever more tomore precise, more specialised and more microsurgery and laparoscopic surgery and cutting less. Theold days of abdominal surgery and opening up downthe middle, opening up the abdomen and going, “Iwonder what’s going on in here?” are largely gone.At the political level it appears—dare I say it—thatsuccessive Secretaries of State for Health have donethe equivalent of an old-fashioned laparotomy. Theyhave said, “Let’s open it. Let’s do a change and seewhat happens.” Yes, the NHS does seem to have hadwave upon wave of major surgery performed on itover, dare I say, probably the last 20 years.




Q170 Grahame M. Morris: But is the lesson thatyou should learn from that that we should take a moreconsidered approach to change, that we shouldeffectively pilot and see where the potential problemsare and perhaps review the pace of change? I aminterested in your views as GPs having been subject tosuch major change over the last perhaps two decades.Dr Peter Davies: I suppose I am being a realist. I amnot expecting anyone to do a pilot, but in fact I thinkdoctors have been saying, “Pilot these changes” manytimes previously. I have a suspicion that in fact it isgoing to happen in a big bang. I don’t know if thathelps you.Dr Kambiz Boomla: I agree with some of the previousspeakers on this panel that greater clinical engagementinto the commissioning process from a range ofclinicians, hospital consultants, GPs and communityhealth services staff is urgently required and that therewas, under the old system, a disarticulation betweenpractice-based commissioning on the one hand andreal control over the resources on the other. Thatmeant that practice-based commissioning was, to adegree, dysfunctional. The question really is, how doyou bring this back without all of the risks that havebeen talked about earlier on of the destabilisation andlosing good managers, etcetera, which we are alreadybeginning to see?My view is that the way to achieve this would be tograft the clinicians into the PCT boards and, in thatway, you wouldn’t require the wholesale managerialchange and the destabilisation that that would cause.But you would get clinicians into the heart ofcommissioning decisions and I would include yourpatients that you were talking about in that. Then, Ithink, one would have a board that was publiclyaccountable, that was clinically led and that couldachieve the sorts of wholesale system change that weare talking about, without all the destruction and risksthat we are talking about.I want to give two terribly small concrete examples ofhow I think this could easily go wrong. One is wherewe have done it right around diabetes, which I havealready talked about, and one, I think, where we havedone it completely wrong, which is aroundanticoagulation. We shifted, without thosecollaborative conversations, quite large chunks ofwarfarin blood-testing, anticoagulation into thecommunity and we thought we would save lots ofmoney because it was cheaper to do it in our surgeriesthan in the hospital. The result of that is that the fewpatients that were left in hospital were called back farmore frequently by the hospital managers, thusgenerating entirely the same amount of revenue to thehospital under the payment by results scheme. So weended up paying for everything twice.That is really the activity that an internal market,particularly with a plethora of “Any WillingProviders” who are there simply to maximise theirprofits to their shareholders, will do. As aconsequence of that, the GPs then get sentspreadsheets, and this is what we will increasingly beasked to do under the new arrangements, where weare asked to clinically check all of these activities tosee whether they were clinically justified or not. Andwe now have to turn these round in three days. So at

seven o’clock, seven-thirty, at the end of eveningsurgery, I want to go home. Can I? No. I’ve got thisspreadsheet to go through with 120 patients on saying,“Was that follow-up justified or not?”, or “Should thatpatient have been discharged?” This isn’t good use ofclinical time.Chair: There is somebody else who does this. I willcome to you in a second, but Sarah.

Q171 Dr Wollaston: Can I just ask the whole panel,is it your view that we should have had a moreevolutionary approach and that we could haveachieved the changes that are desired from the WhitePaper by having more clinical leadership rather thansomething completely revolutionary?Dr Jonathon Tomlinson: Yes, I agree. I’m concernedthat the White Paper is giving all the money to GPs.I don’t see any particular reason why hospital doctorsshould have been excluded from that. Why does ithave to be given only to GPs? I think there are a lotof things that we do that are very different and theway that we think about our patients is quite differentfrom hospital specialists. I am worried that it is goingto further divide and make it more difficult for GPsand hospital specialists to work with each other. So Ithink there must be a better way of doing it.Certainly my experience of practice-basedcommissioning is that GPs are highly suspicious ofhospital specialists keeping patients in to do tests thatare unnecessary and calling them back forappointments that are not necessary because they cangenerate more income, and keeping patients—admitting them for a few hours from the Accident &Emergency Department—because they can charge£600 rather than £300. It is a real worry and myhospital colleagues fear that GPs are not referringpatients who really need to be seen in hospital becausethey are having to pay for every referral. So there is ahorrible level of suspicion and distrust. Twenty yearsago, as a medical student, there was a real disdain ofGPs and they were really looked down upon. Withthis practice-based commissioning it is really makingthings worse and I can see the White Paper is onlygoing to drive a bigger wedge between GPs and theirhospital colleagues.Dr Paul Charlson: I agree with you, Sarah. I thinkevolution would have been preferable but I don’tknow what the situation is around the money. All Iknow is that things are pretty bad. No change was notan option. It is just about the pace of change, really.I take your point about pilots which you asked, whichwe haven’t answered. I think it would be a good ideaif you can make a pilot really happen. But these tendto take such a long time and I don’t know how tightthings are.I think, in a way, creating a “big bang” does create alot of activity and, hopefully, will produce the resultswe want. But, I agree, there are huge and inherentrisks and I think every one of us will have the sameanxieties—every one. So I think evolution would havebeen ideal but I don’t know whether evolution is thatpossible given the financial position that we are in.

Q172 Rosie Cooper: Sadly, hope is not strategy.Dr Paul Charlson: It isn’t, no.




Q173 Andrew George: I am very encouraged bysome of what I have heard in that, in comparison withthe previous panel, there is a greater level—andpardon the pun—of healthy scepticism towards theWhite Paper amongst this panel than the previous one.If you are looking at the White Paper as not a donedeal and something which is up for debate and thatyou wish to try and influence as much as possible forthe good of primary care, and one of the possibilities,as Dr Boomla has said, is to graft into the existingmanagement structures, then what would you say arethe core, say, top two or three, if you like, buildingblocks of a system of effective locally-commissionedhealthcare?Dr Kambiz Boomla: The top—can you just elaborateon that?

Q174 Andrew George: If you were to create a newsystem, in other words, rather than simply adoptingthe proposals of the White Paper, what are the corebuilding blocks? You mentioned greater clinicalengagement, for example. You mentioned that ascritical to this. I just wanted to expand on that. If youare looking for this new structure, and a structure thatactually works, let’s start from a different direction, ifyou like, and say, “What are the core buildingblocks?” What are we trying to achieve in order to getthe essential improvements that I think we all desirebecause the old system has become dysfunctional?Dr Peter Davies: The one I would really love—thebuilding block of the whole of the NHS is the GP-patient consultation. At the moment it is beleaguered,it is crammed, it has got too many requirements in itand it is rushed. For any disease you care to name youcan find any number of patients who we have notspotted and not diagnosed. Of course we haven’t. Weare too busy to spot them. If we spot them we don’thave a service to refer them on to to get them going.So there are problems at the level of the GP-patientconsultation.If we are going to run a primary care-focused NHS,then “primary” has to mean that the GPs have tobecome a lot more accurate in their diagnosis. Weneed to be much more accurate in our problemdefinition of the patient because—

Q175 Andrew George: So you need more time withthe patient?Dr Peter Davies: We need more time with patients.

Q176 Andrew George: And, therefore, you needmore GPs?Dr Peter Davies: Probably—yes, we need more GPs.The quid pro quo I would offer the Government or thetaxpayer on this would be, if I get more time perpatient and I define the problem right, my choice ofreferrals, investigations—my understanding of thepatient will be better so the rapport is better. Betterrapport with patients means fewer complaints. It alsomeans I get the diagnosis better because I’m actuallytalking to them properly. So we’ve got a win all waysround, plus it’s nicer medicine to do. Then my use ofadditional services onwards will either stay the sameor drop because I will be more targeted and go,“Actually the real problem here is—but, yes, there is

an issue we need to investigate. The tests that willgive us the answer to this is” and just get on and doit. I hope we would use secondary care less if we canget to the problems. GP consultation is so packed atthe moment that there is a temptation to do a test,come back, do a referral, come back. There’s anelement of passing on, I am sure.Dr Kambiz Boomla: One of the things that I thinknobody will regret their passing very much are theStrategic Health Authorities. A lot of us feel that theywere an unnecessary tier. However, in terms of thesebuilding blocks that you were talking about, I’mworried that the NHS commissioning board is tooremote from primary care to be able to commissionus, as GPs, properly.I go on holiday to Wales and there are Welsh sheepfarmers there. You have to know your hill in order toproperly manage it. My feeling is that the GPcommissioning board will not know their hill when itcomes to commissioning general practice, when itcomes to commissioning us as partnerships ofpractices in these GP provider units.When we, in Tower Hamlets, took the decision toinvest substantially in primary care we increased thetotal NHS spend from 9% of the NHS budget inprimary care up to about 12% or 13%. I can’t seehow a GP commissioning group would do this withouteverybody crying, “Conflict of interest.” I just don’tsee it.Therefore, I do see that there has to be some kind of alocal body that will command sufficient independencefrom the general practitioner body as a whole—it mayinclude some GPs on it wearing a commissioninghat—but that would be able to make bold decisionsabout care re-design without people turning round andsaying, “It’s just GPs putting money into their ownpockets.”

Q177 Andrew George: Would you say that we mightcall them Primary Care Trusts and would you say ascale of about 152 in the country might be about right?Dr Kambiz Boomla: I’m not going to quite comeinto that—

Q178 Andrew George: You mean about 152 hills?Dr Kambiz Boomla: I have already said that I feelthat those Primary Care Trusts need to be radicallyrestructured. But I don’t feel that they should befocused into being GP commissioning groups.Dr Jonathon Tomlinson: I think that there needs tobe, as far as commissioning is concerned, realcollaboration between primary healthcare, hospitalhealthcare, public health and something nobody hasreally mentioned before, patients, and I think it needsto be democratic. I think public health is importantbecause I have actually locumed in parts of thecountry that are much less deprived than Hackney, andit is a very relaxing type of general practice comparedto where I normally work, which suggests to me thathealthcare is not distributed according to need. Someof these GPs from nicer places could come and workin Hackney and see just how much burden there isof need.There has got to be some sort of planning thatdistributes GPs according to where they are most




needed. That will probably mean paying them a bitextra for the stress and the discomfort, but you can’thave commissioning only done by GPs who are seeingwhat is happening in a consulting room. You havegot to have a range of perspectives, including hospitalspecialists, public health and patients as well.

Q179 Chair: That obviously does go on, as I am sureyou appreciate. One of the perspectives that isregularly reported is the problems in developing high-quality primary care, in particular in inner-city areassuch as the ones where you work. Securing the qualityof decision making in primary care that is implicit inthis structure in some of the inner-city areas, as youhave said on a number of occasions, is one of theissues, it seems to me, isn’t it, in this White Paper?Dr Paul Charlson: Yes.

Q180 Valerie Vaz: Can I just ask, if you werecommissioners, would you be able to balance thatconflict between individual patients’ needs and thepublic perspective? I have asked the question of theprevious panel and I would like to hear what youthink.Dr Paul Charlson: I think we do that—

Q181 Valerie Vaz: Are you able to do that as GPs?Dr Paul Charlson: I think we do that now, to acertain extent.

Q182 Valerie Vaz: The PCT does that, doesn’t it?Dr Paul Charlson: I can decide where I send a patientand I might have an interest in an organisation thathas run such a service. So I can already do that. Ithink we do do that.The conflict of interest thing actually worries me a bitbecause if you are an innovator, and many of thepeople who are going to get involved incommissioning are going to be innovative practicesand innovative people because they are going to bethe people who want to be commissioners justnaturally, and if they are going to be excluded fromproviding or being involved in provider services, thenit is going to put them all off either commissioning orproviding. I think that is just daft. We are going tocommission and provide. That is the reality. We havejust got to work out a system of making thattransparent and safe. I think that is a really difficultthing to do but it can be done.I do think that the reality is about putting individualpatients and cost, which is what we are talking aboutbecause there is always a cost-quality tension, isn’tthere? We have got to be real. The reality is if we dosomething for an individual patient that costs moneythen someone else may well be denied. It is aboutgetting the most bang for your buck, if you like. It’sabout making sure you use the money most wisely.That does mean bringing patients’ groups in and Ithink that is a really key thing, bringing in patients’involvement, getting them actually involved in thecost bit of it as well—

Q183 Valerie Vaz: And the articulate Mrs Smythewill be able to do that rather than the inarticulateMaster Smith?

Dr Paul Charlson: That is a real problem and I haveworked in both communities, your wealthy EastYorkshire and your poor Hull. It is different and Ithink it is up to us to kind of fight the corner a bitfor patients.Dr Peter Davies: Interesting. I think Paul has spokensensibly there.I think the reality we all have to acknowledge is thathowever we distribute the money in the NHS it is afinite pot of money. You can only spend £1 here. Youcan’t then spend the same £1 again there. So, at somepoint, there are going to be hard cases where someoneis going to say, “I haven’t got what I should.”The NHS, at the end of the day, is an insurance policy.We pay in about £1,600 per person per year throughour tax. But all insurance policies, at some point, havea limit to them. I think Aneurin Bevan, when he gaveus the great phrase, “all care necessary from the cradleto the grave”, gave us an absolute. It is great rhetoricbut I think it is too much. I think he probably gotcarried away on the rhetoric on it because, in fact, toactually deliver to that is a practical impossibility. Weare never ever going to fulfil or deliver on thatpromise. So, at some point, we are going to achieveto do this bit of care but we are not going to achieveto do that bit. We need some fair process for choosingbetween who gets what.In any fixed system like this the articulate middleclasses will always do slightly better than the poor.

Q184 Rosie Cooper: Is there any future for single-handed practices?Dr Peter Davies: I am going to be controversial herebut my suspicion is probably not.

Q185 Rosie Cooper: And what can you contribute tothat agenda?Dr Peter Davies: The only way that single-handedpractices are going to do well is if they federate so, infact, you’ve got five or six single-handeds forming asort of loose group. But there are too many activitieswhich I do now—I am in a six-partner practice andwe can talk to each other. If we’ve got problems wecan go, “I’m getting wound up by this one.” Then wecan sort it out between ourselves and calm each otherdown or whatever. If you are a single-hander you takeall that yourself. Also, with things like clinicalgovernance, audit and reviewing the notes, you havegot to have a group of people together and do it. As asingle-hander, you can’t really just review it yourself.

Q186 Rosie Cooper: Absolutely. I have just one veryquick question. Doctors will need to be paid to do thecommissioning. How do you think that will work?What do you think is going to happen?Dr Peter Davies: To be honest, I hope that it is seenas additional work. At the moment I have to be paidto come out of my surgery. If I take a surgery off thenmy partners at the surgery will go, “Actually, no, youneed to cover that work.” That usually means apayment into the practice.

Q187 Valerie Vaz: Could you each give us yourview. Dr Tomlinson?




Dr Jonathon Tomlinson: Where I am at, the proposalis that the commissioning organisation will encompassCity and Hackney, Tower Hamlets and Newham. Thatis three PCTs in size. So it is an enormous number ofpatients with a hugely diverse range of needs. Clearly,you are not going to have 600 GPs doing that. Therewill be a handful of people who are either elected bytheir peers or self-selected. We don’t yet know whowill be doing that. There is a problem that all GPshave to be part of commissioning organisations.Actually, just as my colleagues here have said, single-handed GPs will probably have to be federated. Thereis a real problem with getting GPs to work together.We are independent contractors. We are quiteindependently minded. I think there needs, probably,to be some better financial incentive for GPs to workcollaboratively. So not only do single-handed GPsneed to share resources but group practices need toshare resources for things like minor surgery,gynaecological procedures, dermatology and so on.There has to be, not only between primary andsecondary care but between primary care, some kindof collaboration.For commissioning to be successful, all the GPs in thegroup need to be taken on board, but I worry that,even at the level of our present PCT in City andHackney, which geographically is quite small, it isvery, very difficult to have all the GPs involved.Dr Kambiz Boomla: Can I make one point around theconflict of interest? I think what we are likely to see—and I would be very careful when you pass whateverlegislation gets to be passed that you look at the saleof goodwill issue. At the moment there is an abolitionon the sale of goodwill in general practice and myworry is that, if the legislation gets rid of that, thenyou could get Virgin and other large corporatehealthcare providers coming in and buying up generalpractices not because they can make a better job ofrunning those general practices as practices, becausethe evidence is that these private providers oftendon’t, but that that will give them control of thecommissioning budget. Then, any conflicts of interestthat we are talking about, about individual smallbusinessmen GPs, will pale into insignificancecompared to the conflict of interest of VirginHealthcare commissioning healthcare from a Virginhospital. I only use them as an example. I have gotnothing against Virgin. I use them all the time.But I do feel that GPs generally, because the scale ofthe enterprise is small, because we are in close day-to-day personal contact with our patients and feel anallegiance to those people, our conflict of interest,whereas it is there theoretically, we manage to manageit most of the time. I think, if healthcare becomescorporate, both on the commissioning side and on theprovider side, then conflicts of interest will beenormous.

Q188 Chris Skidmore: You mentioned thecommissioning budget. I think we are getting down towhat the reality of these reforms involve, which isone of cost. Obviously there is not much money inthe system.Dr Kambiz Boomla: Exactly.

Q189 Chris Skidmore: The hope, obviously, is thatcommissioning services by GPs will free up extraresources within the NHS. I just wanted to get yourview of whether you thought it was possible to createsurplus in the commissioning budget, whether thatwas possible and whether you think GPs would beincentivised to do so.Dr Kambiz Boomla: But I already said at the verybeginning that my real fear is in the current economicclimate that there are going to be more losers thanwinners in that regard. One of the strands that runsthrough this White Paper is that there will be notoleration of commissioners or providers—I can’tremember the exact phrase—“who fail to reachfinancial balance”. Then there will also be a failureregime to remove the management of thoseorganisations and replace them. A lot of people saidthat one of the faults of the present NHS is that thereis no failure regime. But if that failure regime thensays, “Right. We will remove the management of thishospital trust and bring in a private provider”, or, “Wewill remove the management of this GPcommissioning group and give it to all the differentorganisations that are vying to provide commissioningsupport. Health Dialogue, all these companies, arebombarding us with material about how, as GPcommissioners, we should take their services ratherthan going to our retiring PCT commissioners”, theywill get their nose in the trough, as it were. When theGP commissioning groups fail, as I think some ofthem will do, then I think they will be very wellplaced to become commissioners in their own right.That may be what some people want but it is certainlynot what I want, and I think it would produceenormous conflicts of interest and vast amounts ofcorruption in the NHS like we see in America withdifferent commissioners and providers actually endingup in court for defrauding each other. I think thisWhite Paper is pointing in a direction which I think itwould be very foolish to go down and follow.Dr Jonathon Tomlinson: Commissioning generatesits own costs. There have to be administration andtransaction costs involved with runningcommissioning and running a market. The evidencefrom those costs in the NHS is that from the late ‘70swhen it was about 10% it has gone up to about 24%in this country.In the States, if you look at public hospitals, theadministration and transaction costs are about 20%. Inprivate non-for-profit hospitals it is about 24% and infor-profit hospitals it goes up to over 30%. So themore that you introduce competitive commissioning,the more you have to pay for all the complexnegotiations, price-setting and so on—

Q190 Chris Skidmore: This is where, I guess, themaximum management allowance comes into playand, obviously, contrary to the flow of the WhitePaper, a maximum management allowance caps theseadministration costs. So what do you all think aboutthat being introduced?Dr Paul Charlson: Can I just break in a little bit? Allthe talk is about America. There are other systems inEurope which work really well and there iscompetition there. So I think let’s not always talk




about America. I think we are going to move moretowards the European system than the Americansystem.The other assumption that seems to be made is that,when we are talking about change, that that is goingto be open to all this terrible risk. But there is terriblerisk with sitting still. At the moment it hasn’t workedso we have got to think about how it is going to work.That is my fear.The other option about, “Oh well, it’s reallydangerous. All this is going to happen” is that wewon’t do anything and we will just sit where we are.We have spent loads of money on the NHS and ourproductivity—I haven’t got the figures—hasn’t goneup very much. So there has been a lot of moneypeddling to stand still.My fear is, and it is very easy to be a sceptic but whatare the alternatives to what we have got? We have gotto change it so how are we going to change it? Thisseems like a good way forward. There are going to bea lot of flaws in it and those need to be ironed out.That’s my thing. I don’t think we should keep talkingabout Americans because I don’t think that’s the waythe White Paper necessarily points.Rosie Cooper: You wouldn’t necessarily go for thebig bang, would you?Q191 Valerie Vaz: You said “evolve it” and I thinkthat is the view you are coming from.Dr Jonathon Tomlinson: The one thing it does seemto suggest is that we are going to move to a healthmanagement organisation-style of health insurancewhere patients will register with an insurer rather thanwith a single practice, particularly now theGovernment have said that we are going to abandonGP lists and patients will be able to choose to registerwherever they like, which, where I work, will bedisastrous. The people who will choose not to waitbehind my schizophrenic patients who take a longtime to see and don’t want to be kept waiting will goand register at the Virgin Walk-In Centre where theycan be seen immediately and get what they want andget out straightaway.

I will be left to look after the elderly, the confused,the mentally ill and so on because the most mobilepatients, who do not want to sit around in a waitingroom full of the ill and so on, will choose to gosomewhere else—not all of them, but you won’t needmany to go before some practices are looking afterall the sick people and some have got all the young,healthy ones.Dr Paul Charlson: Can I just make one little pointabout that? Where I work in Grimsby we set up anopen access centre which opens 8 till 8. The reasonwe have got quite a lot of registered patients now issimply because local practices don’t open. They arenot affluent, articulate people. These are the poorestpeople. They are walking into another place becausethey can get an appointment and then get seen by adoctor who spends time with them. That is not acriticism of local GPs but that is the reality.Dr Jonathon Tomlinson: We also run one of those.We have a traditional practice and we have a Walk-inCentre. After 20 years in a traditional practice, youwork with your patients and you negotiate. Theyunderstand when they need to come and see you andwhen they don’t. The way we get paid for running ourWalk-In Centre is getting people across the door. Sothose patients you have spent 20 years saying, “No,really, you’ve got a cold or a sore toe. You don’t needto come and see your GP”, now we can send them allto our Walk-In Centre because we get paid every timethey come in. That is the kind of crazy system thatthe Government have put in place and those are thekind of incentives that GPs are working for now. It isjust all wrong.Chair: I think, probably, what we have done is toillustrate this morning the breadth. We had fourwitnesses in the first panel who gave us differences ofemphasis and four witnesses on our second panel whodeveloped those differences of emphasis. Thank youvery much for your time this morning. We shall reflecton what you have said. Thank you.

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Members present:


Rosie CooperNadine DorriesYvonne FovargueGrahame M. Morris

________________


Witnesses: Professor Julian Le Grand, London School of Economics, Professor Martin Roland, CambridgeUniversity, Professor Jennie Popay, Lancaster University, and Professor Steve Harrison, ManchesterUniversity, gave evidence.

Q192 Chair: Ladies and gentlemen, thank you verymuch for joining us this morning. Can I begin byasking you very briefly to introduce yourselves to theCommittee, starting with Professor Le Grand?Professor Julian Le Grand: I am Julian Le Grand.I am a Professor of Social Policy at the LondonSchool of Economics, an economist by training. I wasan adviser to the previous Government.Professor Martin Roland: I am Martin Roland. I amProfessor of Health Services Research at theUniversity of Cambridge. I am also a GP and, bychance, the practice I am in is one of the leading pilotcommissioning practices, not because I am a greatbeliever in it but because my senior partner is.Professor Jennie Popay: I am Jennie Popay. I amProfessor of Sociology and Public Health at theUniversity of Lancaster. I have the reputation of beingprobably the most failed non-exec in England in thatevery organisation I join is immediately abolished.I’ve been on CHIME—the Commission for Patientand Public Involvement in Health—and theMancunian Community Trust, all of which wereabolished quite quickly after I joined them.Chair: It might be regarded as a considerablesuccess story.Professor Jennie Popay: Yes, absolutely.Chair: Wear it as a badge of honour.Professor Steve Harrison: I am Steve Harrison,Professor of Social Policy at the University ofManchester where I lead a team of researchers,essentially researching NHS organisation, particularlyprimary care.

Q193 Chair: Thank you for joining us. As I am sureyou are aware, the Committee is doing two parallelinquiries: one into the impact of the comprehensivespending review in what one might regard as the moreshort-term context, and then this inquiry into theimpact of the Government’s NHS White Paper on thefuture of commissioning. The question in our mind ishow these policies are going to deliver more effectivecommissioning than we have seen historically in theNHS.My first question, which is to all of you, is whetheryou think the core proposals in the White Paperaround commissioning, the abolition of SHAs, theabolition of PCTs and the replacement with GP-ledcommissioning groups, will deliver better qualitycommissioning than we have seen historically in the

Chris SkidmoreValerie VazDr Sarah Wollaston

health service, and in particular whether it is going todo so in a time scale that will allow us to address theimmediate efficiency challenges that the health servicefaces over the next four years. Who would like to startwith that question?Professor Julian Le Grand: Let me answer the firstpart of the question first. Do I think it will deliverbetter commissioning? The answer is, yes, I do. Wehave some experience of GP commissioning due toGP fundholding and so-called total purchasing pilotsunder the Major Government and practice-basedcommissioning under the Labour Government. In bothcases the evidence suggests that they do a pretty goodjob. We might get to talk about some of that evidence,but, basically, the GP fundholding experimentdemonstrated that, on the whole, the GP fundholdershad shorter waiting times, reduced hospital referrals,reduced prescription costs, and apparently did so—although the evidence is flimsy here—withoutreducing the quality of the care concerned. There wasplenty of anecdotal evidence concerning theinnovations that the GP fundholders introduced.Similarly, with practice-based commissioning, it wasa fairly anaemic version of fundholding, I thinkI would say, but none the less, it is quite extensive;92% of GPs are involved in some form of practice-based commissioning, and there are about 600-oddpractice-based commissioning consortia already inexistence. Again, there are some interesting examplesof how they have significantly improvedcommissioning in their areas. Although it would notbe true to say that every GP commissioningconsortium will be better than every PCT—there aresome excellent PCTs and there will be, undoubtedly,some terrible GP consortia—on average, and yourquestion was about “On average, will they do a betterjob?”, the answer is, I think they will.

Q194 Chair: What about the handling of theimmediate challenge, which is the second part of myquestion?Professor Julian Le Grand: I am not so worriedabout that as many people are. The NHS has actuallygot level funding. In fact, if anything, I think it hasslightly increased funding. There is the Nicholsonchallenge. However, I am a little more sceptical thanmany of my colleagues about whether the NHS isgoing to come under enormous financial pressure overthe next few years. I cannot see that the ageing of



16 November 2010 Professor Julian Le Grand, Professor Martin Roland, Professor Jennie Popayand Professor Steve Harrison

the population or the cost drivers have significantlyaccelerated to such a degree that it is going to besignificantly different. I think that, yes, thecommissioning was, and indeed was widely regardedto be by most analysts, the least satisfactory part ofthe reforms that have been introduced. It was time toaddress that. It is being addressed, I think, in the rightway and, yes, I think we will be able to hold the forton the finances over the period.Professor Martin Roland: I am a bit less optimisticthan Julian on all counts. If I could answer yoursecond question first because it is the easier one,things will undoubtedly look a lot worse in three tofour years’ time, which members of the Committeewill, of course, realise is about the time for anelection. There is always a risk that either thisGovernment or another Government would choose tochange things, because major health service reformsalways cause a lot of perturbation. This is as big a oneas we have seen probably since 1948. Therefore, therewill be considerable disruption to the system, withGPs trying to form themselves into groups. I knowfrom my own experience of Cambridge, whereCambridge is ahead of the game, that this is quitea difficult business and everybody, never mind thewilling people, has got to be in the commissioninggroups in two or three years’ time.I think there will be considerable disruption at a timewhen there is obviously reduced management support.Even if the whole thing looks brilliant in 10 years’time, my prediction will be that it is going to lookfairly terrible in three or four years’ time. So there isa key issue as to whether this or any otherGovernment is going to have the patience to seethings through.My interpretation of the past GP commissioning isa bit positive, and against Julian’s rather optimisticview is the quote I have put in my evidence to youfrom the Government’s own primary care tsar thatprimary care commissioning is “a corpse not fit forresuscitation”, which is probably a little bit extremeon the other side. I think the balanced position is thatin fundholding there were some real successes butthey were patchy, and I think we will see exactly thatwith GP commissioning. In the first few years we willsee 5% or 10% of commissioning groups doing reallywell, the bulk doing kind of all right and maybe notnoticeably better or worse than the rest, and a fewgoing seriously wrong, including seriouslyoverspending.Long term, I am a bit more optimistic than I am shortterm, for which I am not optimistic.Professor Jennie Popay: I think one of the recurringthemes for you is probably the half full or half emptyinterpretation of evidence. I am not an expert on GPcommissioning, but I was involved in the evaluationof total purchasing pilots on the community care/social care side. My memory of that is that thediversity that began to appear in the system was reallyimportant, but that the kind of disparities that Martinis talking about—the successes and the failures—aresocially patterned so that the failures tend to be inthose communities, those distressed places, whichhave the least capacity to manage the failure and

dysfunctionality of GPs. It will be interesting to seewhere the experts end up on the interpretation ofwhether they were or were not a success, but thosethat are not successful will have a disproportionateimpact on those people, those communities, less ableto cope with that.Professor Steve Harrison: On your first question, Iwouldn’t disagree with what Professor Le Grand wassaying in characterising the evidence, but may I putin two caveats about that? One is that in terms ofquantity there is a lot more research evidence aboutGP commissioning in its various forms over the yearsthan there actually is about PCT commissioning. Wedon’t have maybe as much information about the latteras we would have liked to have and, of course, we arenot going to get that now.The second caveat is that a received wisdom hasgrown up that part of the problem with PCTcommissioning is that the managers aren’t very good.I have seen that said in a lot of places. There is not,to my knowledge, any systematic research evidencefor that. Again, it is one of those things we seem toall believe but it is not clear that it really is the case.On the second part of your question, I would only saythat there is a lot in experience with GPcommissioning to make one optimistic, but there isa huge problem of attribution in terms of looking atthe kind of GP commissioning we have had in thepast, which was on a much smaller scale than we areanticipating in the future—with GPs choosing what tobe interested in, what to focus on and choosing whoto work with a lot of the time. Interpreting that ina future situation where it is compulsory and it is a bigchunk of the budget, I think it is very difficult to guessthat one.

Q195 Chair: Are you simply saying there is noevidence of that?Professor Steve Harrison: I am not saying there is noevidence. I think the evidence is very difficult totransfer from the past situations that have beenresearched, which, as I say, are relatively small scalecompared with what is envisaged for the future—inthe past very much built round groups of GPs whohave wanted to work together, who have wanted to settheir own agenda—and projecting that into a futurewhere GP commissioning is compulsory and covers amuch wider scope of services.

Q196 Dr Wollaston: Which aspects of previousmodels have been the most successful, and do youfeel it would have been better to exploit the existingpotential in successful models rather than createa whole new system?Professor Julian Le Grand: I think there area number of aspects that appear to have beensuccessful, and some of them were specific to thetime, to take up Steve’s point. But one of them waswaiting times: they did significantly reduce waitingtimes. I had a PhD student working on that, who wasalso the practice manager of a GP fundholdingpractice, and it was a very interesting study. It wasquite clear they significantly reduced waiting times fortheir patients. They appeared to be better at managing




their budgets than their equivalent health authoritiesat the time, and incidentally, there was a sort ofcomparative framework in the sense that there wereother forms of commissioners at that time—healthauthorities, which are somewhat closer to PCTs thanGP fundholders.They did, as I say, reduce hospital referrals, by theorder of 5%, which is not enormous, and prescriptioncosts also by the order—I can’t remember the exactfigure. Again, I wouldn’t want to exaggerate this;I wouldn’t want to say that there was in some sensea massive difference in terms of the hard evidence thatwe have. There was quite a lot of anecdotal evidenceabout the innovations that they introduced and soagain there is quite a lot of anecdotal evidence aboutpractice-based commissioning, about various things. Iwas talking to somebody in Cambridgeshire, actually,one of the GP consortia. I am not sure whether it wasMartin’s or not.Professor Martin Roland: It wasn’t me.Professor Julian Le Grand: No, it wasn’t you. It washolding five nursing home beds in reserve over theweekend in case of emergency care, so that instead ofputting elderly people into hospital, they had acheaper and more effective option. It is that kind ofevidence, which, interestingly, in terms of anacademic view of social policy, is rather more thanwe have evidence for other forms of social reform orsocial revolution that we engage in.Professor Martin Roland: I have two quick points toadd. I am always a little bit worried about theevidence of improvement from fundholding because,again, it is very anecdotal. But fundholding practicesare believed to have inflated their prescribing andreferrals in the year up to fundholding because thebudgets were set historically and therefore they wouldhave bigger budgets; and that is what they did.To answer the question in a slightly different wayfrom Julian, the things that are successful are thethings that appeal to GPs’ entrepreneurialism. Theyare very good small businessmen and they are fleet offoot. In a sense, what is attractive to the Governmentabout the successes of commissioning in the past isthat when they want to do things, they actually arequite good at going off and doing innovative things.The difficulty, as Steve points out, is scaling that up.In the commissioning group I am involved with inCambridge at the moment, the lead guy is spending along time reorganising dermatology services, becausehe thinks he can provide a much better service topatients by pulling consultants out of the hospital andproviding services in the community. That may wellbe absolutely right, but it is taking him a lot of timeto do one little service, and the question is, how doyou scale this up? I keep saying to him, “How doyou run a £60 million enterprise, which will be theCambridge budget for this group, with a one-day-a-week chief exec and at the moment a one-day-a-weekcommissioning manager?” That clearly won’t work.So how can it be scaled up so that the individualsuccesses, which undoubtedly happen, can be seen ona broader scale?

Q197 Chair: The Secretary of State’s proposal isn’tactually to scale up to allow individual GPs to do that.It is to have GP-led consortia employing managers todo it, isn’t it?Professor Martin Roland: Sure, absolutely. Theyhave got to find the management capability to do that.Clearly they will have to employ people to do that.The Secretary of State’s view—he may well beright—is that if you have clinicians leading that, thatis actually going to be a better model than cliniciansbeing disempowered and subservient to managers,which they have felt in the past. So he may well beright.

Q198 Dr Wollaston: My question is predominantlyaround whether or not you could achieve that usingthe existing PCT structure and build on the successesof previous models rather than reorganising.Professor Steve Harrison: I will, if I may, hazarda guess that you could. It is a different matter as tohow long it would take, and of course you couldn’tdo it once PCTs were abolished. That may be a criticalpart of the policy reasoning.

Q199 Chair: Do you want to add anything on thispoint?Professor Jennie Popay: The other part of what theydo well—I am not an expert—was on the electiveside, which is really important, which is where thefundholding successes were. There is a vast area ofactivity that isn’t elective care where fundholdingdidn’t really get involved. I think that is quiteimportant in terms of this massive shift that is goingon.The other thing I am worried and a bit surprised aboutis the focus on anecdotal evidence here, because if weare going into that place, then there is a lot ofanecdotal evidence about dramatic innovation, “fleetof footness”, in all aspects and all places in the NHSin existing providers, in PCTs. I’m not sure who hasthe most anecdotal evidence of innovation, butI certainly don’t think it should be the basis fora policy of this magnitude.Chair: I think that is Rosie’s cue.

Q200 Rosie Cooper: In my whole time in the healthservice we always talked about “evidence-based”everything. Do you have any evidence base, or canyou see an evidence base for the Secretary of State’sWhite Paper—what I call the “big bang” that is dueany time before 2013 but heading towards us prettyfast like a train, with PCTs going in 2012? Can yousee any evidence base for that decision? Have you putany evidence in?Professor Julian Le Grand: I think I have referred tothe studies that have been done already. There havebeen quite a few studies. We have quite a lot ofevidence on GP fundholding and the total purchasingpilots. They give the kind of results that we have beenputting forward, and I think there is a question, whichmy colleagues have raised, about the applicability ofthat to the new situation. Total purchasing pilots did,incidentally, cover emergency care as well as theelectives, although Jennie is right about GP




fundholding being mostly concerned with theelectives. As I was saying, we do have a certainamount of evidence and, rather unusually for thesekind of massive reforms that have been injected intothe NHS over the past 20 or 30 years, this one is quiteevidence-based.

Q201 Rosie Cooper: I must admit to feeling a greatdeal of disagreement with that statement.Professor Martin Roland: It is a slightly tough examquestion, to be honest. I would say it is probably asevidence-based as many other major policy decisions,because, on the whole, policy has to be made—

Q202 Chair: That good?Professor Martin Roland: Yes, that good. I guess thatMr Lansley has probably listened to several people inthe room over the last few years, but there is a gapbetween what the evidence says and what we shoulddo now. Nobody has done a controlled trial of whatwe are now going to do.Professor Jennie Popay: This is a profound area ofdisagreement: whether there is evidence that generalpractice involvement in commissioning has worked orwhether there is evidence that it has not worked. Myreading of the evidence—I have not read it ascarefully as these gentlemen around me—is that thereare some examples of extremely good generalpractitioner commissioning, but the evidence for itworking at a system level is not there. The evidencethat is there suggests it is going to be very, very hardto deliver that, even in 10 years. I said that Martinwas being very optimistic suggesting only two.Professor Martin Roland: Two Parliaments.Professor Jennie Popay: Two Parliaments, yes.

Q203 Grahame Morris: Chair, may I follow onfrom that? In his written evidence, Professor Rolandidentifies that there are potentially problems with GPcommissioning from recent history; he mentions theexample of the untested resource allocation—the CarrHill formula. I know colleagues alluded to it earlier,but in terms of submitting evidence to the coalition inorder to work up this quite radical proposal—I knowProfessor Le Grand sees it more as a kind of evolutionthan a revolution—I want to try to identify which ofthe panel have actively been involved in working upthis proposal with the coalition. None?Professor Julian Le Grand: Not me. Inevitably onehas talked to some of the people involved, butI personally was not directly involved in any of thediscussions leading up to the production of theWhite Paper.

Q204 Chris Skidmore: Professor Le Grand, may Iput something to you on that point? I am interested inthe blog article you wrote and also a letter you havewritten in the Financial Times on 29 October whereyou talk about this evolutionary rather thanrevolutionary process. You say the coalition’s reformsare “a logical extension of the reforms put in place byTony Blair’s government”, which you were advising.If Tony Blair was still the Prime Minister, do you

think these reforms would be on the table for a newLabour Government?Professor Julian Le Grand: He would have tried.

Q205 Chris Skidmore: You would have beenencouraging these reforms?Professor Julian Le Grand: I certainly would.I always felt there was a sort of fundamental logic towhat we, if I can say that, or what that Governmentwere trying to do, which was the introduction ofpatient choice to try and introduce incentives withinthe system to increase efficiency, to raise up quality,and indeed to improve equity—that is a question wecan come back to; payment by results, which hasmeant the money followed the choice; and theintroduction of new types of provider—theindependent-sector treatment centres, foundationtrusts and so on—to encourage competition.The only weakness, or the major weakness, was onthe commissioning side because we were putting inplace a system—this was the one worry I had aboutit—that the Americans would call fee for service,where hospitals had a strong incentive to undertake asmuch activity as they possibly could, which issometimes a good thing but on the other hand couldlead to a cost explosion and some of the problems thatthe Chairman was alluding to earlier on. So youneeded a good demand management system inplace—a strong demand management system. I wasimpressed by the evidence on GP fundholding. Istarted off as a sceptic on GP fundholding, I have tosay, but I was a convert as the evidence came in. I wasalways very sorry that the Labour Government madea mistake in abolishing GP fundholding in the firstplace. We would be in a much better place now if theyhad not.I was quite heavily involved in the reintroduction ofGP fundholding via practice-based commissioning. Itwas not as strong as I would have liked and it was notas strong as I think the then Prime Minister wouldhave liked; indeed most of these reforms are verymuch where he, and indeed I, would like to have goneif we had not encountered some of the road blocksthat one did.

Q206 Rosie Cooper: Can I just test that a little more?You are saying it is a general direction of travel.Would you as an academic, or you as somebody whowas actually in charge of this, pilot this going forward,or would you do the “Big bang, throw it all up in theair, see where it lands, make it up as we go along”route that we are now on?Professor Julian Le Grand: I think I would havegone for the “big bang” because, as I say, in a sensewe have already piloted this. It has been piloted; ithas been tried. The total purchasing pilot is perhapsthe closest to it but it has been piloted. I think therewas a problem with commissioning, and there isa problem with commissioning. We have a solutionthat is on the table and I think it is a sensible solutionto start with.Rosie Cooper: So in four years’ time, when we arefacing the almighty implosion that the health service




will probably have, we will know which door toknock on. That’s okay then.Chair: I don’t want this to be a dialogue just withProfessor Le Grand.Professor Jennie Popay: For me, there are potentiallyrevolutionary aspects of it. It is obviously the case thatGP involvement in commissioning is not a revolution.It depends what you mean by “revolution” as well,doesn’t it? But a dramatic, profound change—aradical change—is the move away fromcommissioning of healthcare on the basis of theresident population, a geographical population.As far as I can understand from the deluge ofdocuments that is coming down at the moment, whatis actually being put in place is a tension betweenhealthcare commissioning for a registered population,which has very fuzzy boundaries—you move away 20miles and you can stay with the same GP—and someof the most difficult commissioning for some of themost vulnerable groups in local authorities with apublic health service with the joint strategic needsassessment on a resident geographical populationbasis.How that is going to work is a mystery to me really.But it is a profound change in the way our NHS isoperated for the base of commissioning to be with thisregistered population. I think that is a revolution andthe risk is around equity. That is what MargaretWhitehead, Barbara Hanratty and I were writing aboutin The Lancet. It is unknown. We have no experienceof doing commissioning in that way, I think.

Q207 Grahame Morris: Could I follow up from thatin relation to the risks? We have heard from earlierevidence that the international trends are towardslarger commissioning units rather than smallercommissioning units—I mean internationally. Whatare the risks here if we do see a variety of size incommissioning groups, GP consortia? It seems to methat in my area we are going to have a fairly smallpopulation and Professor Roland said there would bea whole Cambridge consortium. What are the risksthere in terms of equity and service delivery?Professor Martin Roland: One of the consistentmisunderstandings of some people is that one size fitsall and that there is somehow a structural solution: ifonly you get the deck chairs in the right order, thenthe Titanic will sail happily on. It is the case forcommissioning that there is no one size for all theirfunctions. If you are talking about commissioningrenal transplant services, that clearly needs to be in avery large area. If you are talking about holding GPsto account for the referrals that they make to hospitals,that needs to be very small—one or maybe a verysmall number of practices. Whatever size you are, youhave either got to be able to devolve within that largerelement to perform those functions that need a smallergroup or you have to be able to amalgamate andmerge and work with others. In a sense, the one sizewon’t work and therefore the natural differences insizes that will happen in different places will have tobe reflected in their structures.Professor Steve Harrison: The one thing I want toadd to that—I am not a specialist here and I’m sure

Professor Le Grand can do better than I can—is tothink about different sorts of risk, because there isthe risk of natural randomly occurring variations inpopulations, their health status and hence their healthneeds, which, in a sense, one has to design a systemto cope with. Then there is the risk of different groupsof clinicians systematically behaving in differentways, with higher rates of prescribing or higher ratesof referral or whatever. It seems to me very fine tomake that distinction analytically, as I just have done,but to tell the difference in the real world may beharder, I guess.Professor Julian Le Grand: There clearly is a tensionover size. There are arguments, as indeed Martin wassaying, that go both ways, whether it is for small orlarge. I think Professor Bevan, from whom you willbe hearing later on, did some research at an earlierstage and he would be better placed to comment onthis. I think he is suggesting that as far as the risk poolis concerned, as I recall, it was of the order of about100,000. This is appropriate in some ways.It is quite interesting in looking at the experience ofGP fundholders, again concerning size, that there wasa problem with the health commissions—the parallelcommissioners—which were in a sense almost toolarge. They were so large that they were locked intotheir health providers—their big acute hospital trusts.It was the old business of, “If you owe £100 to thebank and you can’t pay it back you are in trouble. Ifyou owe £100 million to the bank and you can’t payit back, the bank is in trouble.” There were elementsof that relationship in health commissions and the bigacute hospital trusts. The GP fundholders were muchmore nimble and better able to play the market inmany ways than were the health commissions.On the other hand, there are some disadvantages,which my colleagues have already pointed out, abouthaving them too small. So I think there is an issuethere. I would tend to go myself for about 100,000 asbeing the least worst of the sizes.

Q208 Valerie Vaz: May I start by apologising; I wasactually in the Chamber on an exercise. I am sorryI am late and have missed the first part, and you maywell have answered some of these questions.Professor Le Grand, many people don’t share youroptimism about the evidence, partly because everyonehas been screaming out for a pilot study and no onecan say where that has been done. This is a generalquestion to all of you because I am really confusedabout the White Paper and what is happening. Thereare lots of unknowns, and I would like to find outfrom each one of you what the benefits are of thisexercise, given that the NHS has gone through a lotof reorganisation. We have had maternity servicescentralised with the NHS Commissioning Board, butnow it appears that is coming back locally. Then wehave coterminosity in terms of local authorities, butthat is not necessarily going to chime with theconsortia. How does that all fit in and how is that goodfor the patient? Where does public health fit in, in allof this?What, really, are the benefits for the patient, whoapparently can decide to register with one doctor, but




if they don’t like that doctor or are not getting theservices, they will then go and register with anotherconsortia? How does all that fit in and where are thebenefits in terms of saving this £20 billion andactually providing a decent health service? If it wasevolutionary, why could we not just have worked withthe current model and made that better?

Q209 Chair: That is several questions. Shall we gothe other way? Professor Harrison, would you like tostart and pick at least one of those questions?Professor Steve Harrison: I won’t make any claimto know where any savings might come from. Theassumption—it is a reasonable one—is that if thoughtsabout what services ought to be like, commissioning,if you like, in the shorthand, have doctors closer tothem, then they are likely to be better decisions thanif doctors were not close to those decisions. So that’sthe unstated underpinning rationale, I guess, for all theforms of GP commissioning, plus another rationalethat says clinicians may be able to make decisionsabout better use of resources—call it rationing if youwant to be controversial.If you think that they are things which need to bedone, then there are obvious potential benefits of thenew system. I presume that we have to have in thefuture a purchaser/provider or a commissioning/provider split because, if we don’t, then the preferencewhich Governments of more than one political partyhave had for private providers to be involved inproviding NHS healthcare cannot happen. So even ifone were to mount an argument that says the wholeidea might have some problems, you have to maintainthe idea in order to maintain the potential involvementof private sector providers. That’s probably enoughfor my bit.Professor Jennie Popay: I will just focus on oneissue. My preference would have been, if I had hadany say, to go with what is there now and to identifya bit more systematically what is working well inprimary care commissioning, because I agree withSteve that the evidence base on that is thinner. It isabsence of evidence, not evidence of absence, muchmore clearly for primary care trust commissioningthan it is for GP commissioning. We needed to lookmore systematically at what is working well. In theSouth Lakes, for example, there is really good GPinvolvement in commissioning, quite a lot of controlof commissioning but in partnership with the primarycare trust. It is a good model but it might not workeverywhere. But why that should be unpicked for thissystem change, with what I believe is quite weakevidence, is, I think, really problematic.At the heart of my concerns, though, is the issue thatwhat will benefit the patient is more empowerment—a greater say in decision-making. The focus in theWhite Paper there is on choice and that is choice aboutwhere you will go—which consultant-led team. It isnot actually about the really tricky stuff, at theindividual level, about shared decision-making aboutcare, wherever that goes on—whether it is in primarycare or secondary care—and at the collective levela voice in what kind of service is being provided andwhere. There is not a lot in the White Paper that

makes me feel we are going to do patientempowerment any better in this new system than wehave up to now. One of the key barriers to patientempowerment—all social science points to this—iswhat we call in the social sciences the positionalpower of health professionals, and particularly themedical profession. What these reforms are doing isgiving more power to the medical profession. Ina way, there are the conditions there to make it moredifficult to empower individual patients andcollective patients.If we are looking at patient benefit, I think there isa lot of evidence, much stronger than the GPcommissioning evidence, that if we can get patientempowerment and patient voice really embedded inthe system, then that will deliver a better patientexperience. But that is not the central concern of thisWhite Paper, I don’t think. The proposals that arethere don’t look remarkably innovative.Professor Martin Roland: Can I pick up on the pointof, “Will they save money? Will they essentially makemore cost-effective use of resources?”, and come tothe incentives that will be attached to that becauseI think they are absolutely crucial?In my practice we sit down regularly and look at ourreferrals to hospital. When we see that a 98-year-oldlady has been admitted to hospital by the out-of-hoursservice over the weekend that we think could havebeen managed at home, we are actually quite crossabout it. There are lots of instances where we look atpeople who have been treated one way or another andsay, “If I was buying care, I wouldn’t buy that becauseI think I could do better for my patient.” So if theincentive is to improve care for patients, I would besomewhat encouraged, sort of halfway between Jennieand Julian.The key question, I think—we don’t know the answerto this—is, what are the incentives of GPs going tobe? There is no doubt that if GP commissioninggroups are going to work, they will have a budget andthey can’t be given free rein just to spend willy-nilly,so there must be some constraints. The real key is howmuch will those constraints come down to thefinancial position of each individual practice? In otherwords, to what extent will the practices’ financialfortunes, and therefore the fortunes of the GPs whotake home the profits at the end of the day from theirpractice, be dependent on the performance of theircommissioning group? I think it is extremelyimportant that that financial equation only makesa small difference, because you really don’t want togo and see your GP, think you have something thatneeds to be seen in hospital and are not sure whetherhe is thinking, “Shall I refer you?” or “Will I go onmy skiing holiday if I do that?” You do not want himto have that conflict.Somehow the rules—the detail may be absolutelycritical—have to give some incentive to GPs tobehave responsibly with the public purse without thatoverpowering what they want to do clinically fortheir patients.Professor Julian Le Grand: I think internal discretionis very important. I think that is right—getting it right.If a consortium makes a surplus on its budget, what




can it do with it? Under GP fundholding on totalpurchasing, if they made a surplus, they could spendit on improving facilities for patients but could notspend it directly on themselves. That seems to me tobe the kind of model that would be quite satisfactory.Three questions were raised: choice, coterminosityand public health. With regard to choice of GP, this iswhere I think there is something of a weakness in theproposals: first of all the strength. Unlike PCTs,patients will, in a sense, be able to choose theirconsortia, so there will be a measure of accountabilitythere because they can switch GPs to anotherconsortium. I think it is a fairly weak instrument foraccountability on that route because patients, on thewhole, are reluctant to change their GP for one reasonor another. Secondly, of course other consortia maybe very big. For example, in Northamptonshire I don’tthink there would be any possibility of changing yourconsortium unless you moved out of the area. As I say,I would prefer the consortium to be rather smaller,which raises the second point about coterminosity.I think that is a pity. I think it is a shame we are losingthat. We will lose it, I think almost inevitably, but ithas to be put, it seems to me, on the negative side. Itis a shame that we are losing coterminosity. It doesrelate to the general question of public health that youraised. I’m not privy to the inner workings of thisGovernment, but there is going to be a public healthWhite Paper fairly soon. I suspect what is going tohappen is that most public health is going to be at thelocal government level, which is quite a good placefor it, if I may say—a rather good place for it—but itdoes mean that there will be an issue in working withthe consortia on that.Chair: I would like to move on, if I may, becauseNadine would like to look at the relationship betweenthe commissioning groups and the CommissioningBoard.

Q210 Nadine Dorries: I think if you were todescribe this organisation as a meal of meat and twoveg, the NHS Commissioning Board appears to be themeat in terms of its responsibility and diversitybecause it is going to be responsible for organisingthe GPs, and we are going to have to negotiate a GPcontract to provide the care for a little boy in myconstituency with cystic fibrosis. I would like to ask anumber of questions which will probably be quitediverse.The first is this. The NHS Commissioning Board areto be the facilitator in terms of negotiating betweenthe Department of Health and the BMA in terms ofthe new GP contracts. Do you think it is necessary foreach GP now to have a contract, or should it be eachconsortium which holds a contract? Who would liketo answer that question?Professor Martin Roland: That is an interestingquestion. I don’t know the answer to that. If thecontract was at consortium level, what would themeaning of a practice then be? I’m not sure.

Q211 Nadine Dorries: Exactly; that’s really theanswer. So why would you think the Department ofHealth, the BMA and the NHS Commissioning Board

would be going through this whole protractednegotiation in terms of GPs’ contracts? Would it notjust be simpler to have a contract per consortium?Professor Julian Le Grand: Yes is the simple answerto your question and I am very much in favour of theconsortia holding the contract.Professor Martin Roland: And then the consortiumwould manage the provider functions of its constituentpractices, which it will have to do to some extentanyway.

Q212 Chair: I think this is an important question:whether it should be a single national contractnegotiated by the Commissioning Board or more localflexibility with the consortium.Professor Martin Roland: It is a different questionbecause it is a single national contract now. Thequestion is, is it held with practices orcommissioning groups?

Q213 Chair: Yes. The present system allows forgreater flexibility through PMS contracts asalternatives to the national contract.Professor Jennie Popay: It would be very interestingto watch them trying to implement that in terms oftrades union power.

Q214 Nadine Dorries: You mean in terms of theBMA power?Professor Jennie Popay: And the independentcontractor status—this precious status of generalpractitioners. Moving away from the individual andthe practice base to these consortia, it would be veryinteresting to watch that happen. I think they wouldstruggle to get it through.

Q215 Nadine Dorries: Do you think the resistancewould come from the BMA or the GPs?Professor Jennie Popay: From the GPs, and the BMAsupports the GPs, so, yes.

Q216 Nadine Dorries: Professor Harrison, did youwant to say something?Professor Steve Harrison: No, I think that isabsolutely right. Presumably someone has calculatedthat this isn’t politically feasible.Professor Julian Le Grand: Are you interested in thenursing contract as well, more generally?

Q217 Nadine Dorries: In terms of practice-basednurses?Professor Julian Le Grand: No, I was just thinkingin a more general sense in terms of the centre holdingcontracts as opposed to allowing local paynegotiations or local contract negotiations.

Q218 Chair: Yes is the answer to that. If you areasking whether we are interested, the answer is, yes,if you have a view to contribute.Professor Julian Le Grand: There is some veryinteresting research undertaken by a woman namedCarol Propper at the University of Bristol. One of thestarkest things about the health service, which issomewhat odd in some respects, is that on almost any




quality assessment of the various kinds that are done,on the whole, the hospitals in the north come outrather better than the hospitals in the south—onaverage—and a possible explanation for that is to dowith the quality of nursing differing between northand south. A possible explanation for that is becauseof having a uniform wage scale across the country.The average private sector wage is higher in the souththan in the north and that has knock-on effects on thequality of nurses employed in both. As I say, there issome research to support that, but again it arguesrather in favour of, “Let’s have some more local payor a local contract.”

Q219 Nadine Dorries: That’s interesting. Of course,there are also the cost implications on whethera centrally negotiated contract per consortia woulddeliver savings over and above the individualcontracts.Professor Julian Le Grand: Indeed.

Q220 Nadine Dorries: That is, I suppose, the nub ofthe issue.Professor Jennie Popay: There is another point thatrelates to what Julian was just saying, which is aboutthis notion in the White Paper of liberating the staff,which seems to me to be liberating GPs because otherstaff could potentially end up with deterioratingconditions of employment—potentially.

Q221 Nadine Dorries: Or improved?Professor Jennie Popay: Potentially. It is a debatablepoint, but there is no evidence for what happensexcept in the private sector. In the local authoritysector, when the direct services were moved out, ingeneral the evidence suggests conditions deteriorated;they didn’t improve, which could be the same thing.So it would be risky to leave it to the market tohappen. If the idea is that they might improve, thenpresumably that would need some careful monitoring,it might need some regulation and there are all sortsof cost implications of that. But the evidence we havesuggests it is more likely that they won’t improve.They might stay the same, but they might deteriorate.

Q222 Nadine Dorries: At a local level, I think oneof the issues people are finding most difficult to gettheir head around is possibly the more needy patients,in terms of particularly CF children and those withvery special medical needs. Whereas at a local levelthe PCT now deal with the provision for both theirmedical care and social care, how do you see theNational Commissioning Board going forward interms of working at a local level, particularly for thosemore vulnerable and needy patients? One of thecriticisms that is levied is that they will be so distantfrom the need at a regional or local level that therewill be issues as a result of that. How do you see itworking at a local level and how do you envisagespecialist care, particularly for the most needy, beingimplemented from the consortia via the NHSCommissioning Board?Professor Martin Roland: You’ve left the easyquestions until last, haven’t you? I’m not sure that

I agree with your formulation of the problem, becausesurely the NHS Commissioning Board will say, “Itis the GP commissioning groups’ job to look afterthose people”.

Q223 Nadine Dorries: But they are not, though,because the funding isn’t being allocated to theconsortia for those specialist groups. That is going togo via the Commissioning Board.Professor Martin Roland: It depends how much of—CF? I don’t know how much of—Nadine Dorries: I just picked that as a condition.Professor Martin Roland: I think that theCommissioning Board will have an extremely toughjob in doing that. Again, the commissioning groups,at 100,000, are going to have quite a lot of most rarethings. That may not apply to, say, transplant services,and I do not think it is the case that commissioninggroups will necessarily ignore such things. Iremember when fundholding came up, my wife, whois a paediatrician who looks after severely disabledchildren, said, “Our service is going to be gonebecause GP fundholders are never going to want tocommission that sort of rare stuff.” And it wasn’t thecase. So I think it is the case that GP commissioninggroups will have to commission for all theirpopulations. I don’t know quite how—

Q224 Nadine Dorries: Particularly with disabledchildren, is it not the case that if there is a get-out forthe consortium to remove itself, absolve itself, fromresponsibility for those high-cost groups, they will dothat, and I think within the White Paper at the momentthere is the provision for them to be able to do that?Professor Martin Roland: Yes.Professor Jennie Popay: This reflects, in part, thatunthought-out part of these major reforms. I thinkMartin’s response makes that very obvious. If youtake them out and the commissioning is at a nationallevel, then you are going to have to put something inplace regionally if these patients are to have a voicein the kind of care that is delivered for them, whichmeans replicating. Instead of removing layers andsimplifying, you are getting more and more layersback in again.

Q225 Nadine Dorries: That is exactly my point. Arewe going to see another layer—the national consortiaand Commissioning Board cascading down intoa local level of layers?Professor Jennie Popay: You certainly could, but youare also then removing groups of patients from not avery good system at the moment—the HealthWatchsystem locally—but that system is about givingpatients a voice, individually and collectively. You areremoving them from the main commissioning bodies,so it does seem to me to be an example of quitea serious unthought-out part of this.

Q226 Grahame Morris: I want to be more specificabout the organisation below the national NHSCommissioning Board. Is it the view of the expertwitnesses that we need to have an intermediate level?Professor Le Grand suggested the GP consortia would




be of 100,000; others have suggested that it should bemuch larger. What is your view in terms of how theGP consortia, of whatever size, are going to relate tothis very centralised controlling mechanism inWhitehall of the NCB, or however we are going todescribe it?Professor Steve Harrison: I will speculate, if I may,that one of two things will happen. Either the NationalCommissioning Board will have some regional officesof one sort or another—I’m obviously not the firstperson to have said that—or else some kind of liaisonarrangement will be developed between groups ofconsortia and the National Board. Some intermediatesomething will grow up; whether it is formal enoughto call itself an organisation is a different matter.I would strongly guess that something will happen.

Q227 Valerie Vaz: Is that PCT under a differentname?Professor Jennie Popay: The obvious thing is that itshould be linked into the local authority joint strategicneeds assessment and the commissioningresponsibilities that are being built in there. That isthe obvious place, rather than another layer, puttingback the SHAs and so forth.

Q228 Rosie Cooper: But then as that well-beingboard is set aside—you know my view of that—thepatient, the public, the local authority will be ona well-being board, not directly at the table and notmaking decisions, so everything could be secondhand. I am on the record as saying that is absolutenonsense and no representation whatsoever, inessence. I shall press it again next week with theSecretary of State, but we haven’t heard whatnon-exec arrangements, what accountability, there willbe inside the consortia. I think it is outrageous to givepeople the view that the local authorities—that sort ofarea—will be the patient’s accountability line, when itstops at a well-being board, which is not at the tableand doesn’t have a vote. It is simply not effective.Professor Jennie Popay: No, I agree. I wasn’tsuggesting that the current proposals for the healthand well-being board were actually a way of givinglocalism, local accountability, to thosecommissioning. They are not but they could be. If thisis going to happen, that seems to me to be the placeto begin to think about the way in which thecommissioning consortia have local accountabilityand are tied into population-based commissioningrather than registered population, both for healthcareand for other issues. It seems to me that introducingyet another layer is completely counter to one of theprinciples of these changes in terms of de-layering andsimplifying. It is putting in another layer.Chair: I am conscious that we have three morewitnesses sat behind you. Nadine wants to ask afurther question on her series and Grahame has one setof questions about fragmentation that he wants to ask.

Q229 Nadine Dorries: Professor Le Grand, there hasbeen some confusion over the NHS CommissioningBoard and the commissioning of maternity services.Do you have a view on that? Do you understand how

the commissioning of maternity services is going tobe going forward?Professor Julian Le Grand: No, I don’t, and I ampuzzled. It seems to me that maternity services wereonly going to be done at the consortia commissioninglevel. I have no idea why it was moved or why theproposal to do it nationally ever came forward.

Q230 Nadine Dorries: But your opinion is that itshould be done at the consortia level?Professor Julian Le Grand: Absolutely.

Q231 Chair: I should say that the Committee hasreceived correspondence from the Royal College ofMidwives expressing support for the Government’sproposal, and I would be interested to know whetherany of the witnesses wish to comment.Professor Jennie Popay: I am surprised. It doesn’tseem to make sense to put it nationally. It is verylocal.

Q232 Grahame Morris: I would like to return toa point that Professor Popay made earlier aboutequity—referencing the article in The Lancet aboutyour argument about the involvement of for-profitproviders in the NHS leading to fragmentation andhaving an adverse impact on services and issuesaround health inequalities. I wonder if you could justplace your views on record for the Committee.Professor Jennie Popay: Yes. Obviously, in terms offor-profit providers, “Any Willing Provider” is, ina sense, evolutionary, but it does seem that theseproposals are a step change in that, both in terms ofthe providers and taking off the cap in terms of privatepatients within foundation trusts or any trusts. In thatcontext and the context of a continued interest inchoice, and the context of financial constraints on theservice, what we are arguing is that the equityimplications could be quite profound. We know fromboth fundholding and total purchasing that there wasdiversity and that the least innovative, the leastsuccessful, were in areas with greatest need. We knowprimary health care is either at its best or at its worstin our most disadvantaged areas. There is, therefore,a real risk that the GP commissioning model willcompound the inequalities in access to care. What youwill get is the innovation going on in places with theleast demands from the population.

Q233 Grahame Morris: How could we mitigateagainst that trend if that is going to happen withfor-profit providers?Professor Jennie: I don’t think it is only the for-profitproviders that are the problem. Some for-profitproviders could quite easily be providing very goodcare in disadvantaged areas. I think it is the wholemodel that is potentially a problem in disadvantagedareas with disadvantaged communities rather than justthe for-profit providers.

Q234 Chair: This is part of a rather broader question,isn’t it, Grahame? One of the points that is often madeabout a GP-led commissioning model is that it isinconsistent with pathways of care, that it leads to




fragmentation of pathways. I wondered if thewitnesses agreed with that proposition or whetherthere is a way of addressing the need for consistentpathways and making it consistent with localisedGP-led commissioning.Professor Martin Roland: Could I comment on that?I think all leading healthcare analysts—I can say thatwithout fear of contradiction; they are all actually inthe room—say that the one thing we need isintegration in our healthcare system, particularly forthe increasingly aged and the comorbid population.There is a very real risk that “Any Willing Provider”particularly will lead to fragmentation. What we needis GP commissioning groups talking to their localhospitals, their local consultants, getting themtogether, working out the pathways of care that theirpatients need and commissioning those. It seems quitepossible that depending on how the rules are set,Monitor may actually prohibit them from doing that,and that will be regarded as anti-competitive and notfair to the other willing provider who might wish tobid to provide that service. I think it would be adisaster if that happens.Professor Julian Le Grand: I have two quickpoints—one on the integration point. Of course it isworth noting that one of the great advantages in GPcommissioning is that the people making the resource-allocation decisions and holding the budget are thesame. Actually, the potential for integration is there,in that if you have a system of different agents doingresource allocation and different agents holding thebudget you do get fragmentation.On the specific question that you raised, Grahame, “Isthere any way of mitigating this?”, an idea that I havebeen considering—you will recognise the genesis ofthis—is the idea of a patient premium. The originalidea of a pupil premium was that pupils from poorerbackgrounds should have a larger amount of moneyassociated with them under the funding formula. Wecould do something similar on the patient front withpatients from poorer backgrounds. There might wellbe clinical reasons for doing that, but also there mightwell be incentive reasons that actually provide anincentive for hospitals, whether for profit or not, totake on those patients.

Q235 Grahame Morris: With the weighting in thefunding formula, in the funding allocations?Professor Julian Le Grand: Raising it would have tobe arranged under the payment by results system.

Q236 Chris Skidmore: Professor Le Grand, veryquickly, that premium would surely necessitatecompulsory registration in the same way as with thepupil premium at school you have to go to school? Itis compulsory; that is the way the pupil premiumworks. In a way, the whole element of this WhitePaper is about compulsion. It is compulsory for GPsto join consortia. In terms of Professor Popay’s articlein The Lancet, surely the natural progression orevolution would be to have compulsory patientregistration in order to allow these commissioningprocedures to take place.

Professor Julian Le Grand: I’ll think about that, butI don’t think so. I don’t think the patient premium ideaitself necessarily requires that. It would simply be thata patient, when they turned up at a hospital, so tospeak, would write down their postcode and thepostcode would have an extra amount of moneyassociated with it.

Q237 Chris Skidmore: But in order to deal with theequity issue in the White Paper you would have tohave compulsory registration to avoid the issue.Professor Jennie Popay: Or it is this tension betweena geographically resident population and a registeredpopulation. That brings it right into the fore. Wewould have people in prison for not registering at theirGPs, but there we are.

Q238 Valerie Vaz: But do you take that with youwhen you move?Professor Jennie Popay: And you take it with youwhen you move.Can I just put one other aspect of the equity issue andthat is the choice issue? Again, you have in the roomjust about everybody who has written about choicehere to speak with you. But I do think there isa serious problem with framing choice in terms ofinformation and framing choice in terms ofknowledge. That is an issue, absolutely. It isa necessary but not a sufficient condition for choiceto operate as an equity-promoting thing for people tohave the right information, appropriate informationand to be helped to understand it. But choice is alsoa material thing. You have to have the resources to doit. You have to have flexibility at work, you have tohave childcare, you have to be able to travel; it is allthe kinds of things that actually people living in themost distressed places don’t have.

Q239 Nadine Dorries: So you are basically sayingthat to make a choice, for patient choice to work, thepatient needs to be of a certain level of intellect sothat they can understand the choices that are beingoffered to them and have the ability to be able todiscern between those choices? You are saying thatpatient choice doesn’t work with certain groups ofpeople because they don’t have the ability to do that?Professor Jennie Popay: No. What I am saying is thatfrom my own qualitative research people dounderstand the choices. The problem is that they maynot have the material resources in their lives,flexibility at work, childcare, travel, etc., to be able tomake the decision they would like to make aboutchoice. So if we are going to make choice anequity-promoting aspect of a healthcare system it willcost, and Citizens Advice Bureaux and HealthWatchare not going to have the resources to enable thematerial aspects of choice to be addressed.

Q240 Nadine Dorries: Because they can’t providetravel costs and childcare costs?Professor Jennie Popay: They can’t provide them;that’s right. They are information-focused andcomplaint-focused organisations, and that has been theproblem with choice in terms of equity all along.




Q241 Nadine Dorries: But that is never going tochange, is it?Professor Jennie Popay: Then we shouldn’t assumechoice.

Q242 Chair: Never is a long time. We have threemore witnesses who are sitting behind you. Are thereany concluding comments any of the witnesses wouldlike to make, something they have been burning tosay and have missed the opportunity, or would theylike to draw a conclusion?Professor Steve Harrison: May I rescue one pointthat has been made in the last couple of minutes butI thought was in danger of getting lost, which is thatthere is nothing inherent in GP commissioning thatprevents integration? It is the competition rules andthe rest of it that may militate against that.Professor Martin Roland: Yes.Professor Steve Harrison: And GPs, we know fromresearch, are willing to think about integratedpathways and so on but they need an incentive to usethem, and I do not mean a financial incentive; theyneed to know that they can use them and that theywill be able to do that.

Q243 Chair: That is helpful; thank you. Are thereany other points?Professor Julian Le Grand: Simply the final pointabout choice. Of course, much of the evidence is that


Witnesses: Professor Chris Ham, Chief Executive, The King’s Fund, Dr Jennifer Dixon, Director, NuffieldTrust, and Professor Gwyn Bevan, London School of Economics, gave evidence.

Q245 Chair: Thank you very much for sittingthrough the last evidence session, which I am surewill inform to some degree the discussion during thissession. Would you like to introduce yourselvesbriefly, please?Professor Chris Ham: I am Chris Ham, ChiefExecutive of The King’s Fund, and I have a Chairin Health Policy and Management at the Universityof Birmingham.Dr Jennifer Dixon: I am Jennifer Dixon. I amDirector of the Nuffield Trust, a research think tank,and I am a physician by training, a former adviser tothe NHS Chief Executive Sir Alan Langlands, and amember of the Audit Commission.Professor Gwyn Bevan: I am Gwyn Bevan. I am aProfessor in the Department of Management at theLondon School of Economics. I was an early advocateof giving budgets to GPs. In 1988, we tried in Walesto get a pilot experiment in which we gave GPsbudgets for buying all of healthcare and it wasblocked by the local medical committee at that time.

Q246 Chair: I would like to begin, if I may, byasking each of you to answer the question thatI opened the previous session with. The purpose ofour inquiry is to examine the Government’s proposalsset out in its White Paper against the test, “Will thisdeliver effective empowered commissioning?”, and in

choice is actively preferred by the less well-off. Thereare greater majorities in favour of choice of hospital,and indeed of school, among the less well-off thanthere are among the better-off. That is understandablebecause the better-off are rather good at manipulatingnon-choice systems—they can get what they wantwithout having the choice—and of course the poor arenot well served with existing services. Here, Jennieand I are probably in agreement. I do think thatsupporting choice is a very important part of thechoice policies in order to achieve better equity.Professor Jennie Popay: The only point I wouldmake is that the financial incentive, presumably, ispartly building on QOF and is somewhat problematic;it’s a half full, half empty experience of QOF. But itdid require quite careful monitoring. It doesn’t comeat no cost to use financial incentives as a way ofpushing up. There doesn’t seem to have been, “Howmuch will it cost to get these financial incentives towork in the way that we want them to work?” I havenot seen any estimate of that.

Q244 Rosie Cooper: And who would monitor it?Professor Jennie Popay: Absolutely, and that costs.Chair: The discussion will run and run, but thank youvery much for coming this morning. We appreciateyour time.

particular to ask ourselves the question whether this isconsistent with the changes required in the healthservice during the next four years against thebackground of the comprehensive spending review. Soit is a two-part question really. Is the concept right,and does it reinforce the management of the healthservice in the short to medium term? Professor Ham?Professor Chris Ham: I think the concept is basicallyright in the sense that we need greater clinical and GPinvolvement in commissioning than we have had inthe past. There is evidence, as your previous witnesseshave said, from studies that have looked atfundholding and total purchasing, that when it is donewell it can bring innovation and help to contribute tomore patient-centred care and greater efficiency. Forthose reasons, moving in this sort of direction issomething the King’s Fund has welcomed, but itrelates to the second part of your question, which isthat there are always risks associated with a bigreorganisation and change of this kind because fora couple of years at least the people involved in thatreorganisation are distracted from the core business.While they are reorganising the structures, the focuson improving care for patients and getting betterefficiency will often take, sadly, second place. Weneed to be cognisant of that risk, particularly at a timewhen the NHS is having to find this £15 billion to £20billion that David Nicholson has spoken of—the QIPP



16 November 2010 Professor Chris Ham, Dr Jennifer Dixon and Professor Gwyn Bevan

challenge. To reorganise the structure, take out 45%of management costs, replace PCTs and SHAs withGP commissioning, and to improve patient care andfind £15 billion to £20 billion in cash-releasingefficiency savings seems to us to be a huge ask of theNHS at a very challenging time.That is accentuated by the necessity of creating—quiterightly, in terms of good management—some degreeof risk pooling to deal with provider failure on the onehand and the possibility of commissioner failure onthe other hand, because while there will be really goodGP commissioners they will not all be terrific andthere will be some that will probably need somesupport if they don’t manage their finances well.Inevitably, if you are creating risk pools out of a fixedbudget, you are taking money out for that contingencythat otherwise might be put into direct patient care.That might be too detailed a point for the Committee,but it is something of which we are increasinglyaware.Dr Jennifer Dixon: I think I agree with all of that.I think it is too risky—too much, too soon. We knowwhat we get with GP commissioning because we have20 years of evidence.I would put a different gloss on the evidence to Julian,having been involved directly in evaluating bothfundholding and total purchasing. Fundholders weresmall, they took off, they had budgets for easyservices, elective care, pharmacy and outpatients. Ittook seven years for 50% of practices to be interestedin it, and even then, they had quite strong incentivesto be interested in it—more than practice-basedcommissioning groups because they were able to setup limited companies and vire money from hospitalcare into GMS. Total purchasers were also quite slowbut had some positive results. But for both those setsof groups, they were able to do more by boosting upprimary care. They had very little impact on hospitalcare. In particular, the big challenge for efficiency isemergency care and medical care, care of the dying,older people and people with chronic conditions.There, total purchasing and fundholding hadpractically no impact whatsoever. Practice-basedcommissioning, as others have said, was pretty inert.The incentives were lukewarm and it hasn’t goneanywhere. It has been a disappointment.To do this at the same time as there is this hugefinancial pressure and when the people who will holdthe hands of—mixed metaphor—or give birth to thebaby of GP commissioning are disappearing is highrisk. I think, at best, it could be pretty inert. The wholeprinciple of putting clinicians closer to decisions andresponsibility for budget is absolutely the right one.That is the nub of the White Paper and it is a goodone, but to enact it in this way is highly risky.Professor Gwyn Bevan: I absolutely agree with whathas been said. The attraction of involving GPs withbudgetary responsibilities, and the reason why I wasattracted to it, is that we have a formula that givesmoney to populations and we have to involve peoplein managing resources for those populations. Theobvious building block for that is general practitionersand general practices because they have definedpopulations and all other administrative bodies areartefacts. But the experience, both here and in the

United States, is that it is terribly difficult to get thatto work. My very good friend Julian is from the sameinstitution, and he and I have disagreements from timeto time. But the experience I have, both looking at theevidence of GP fundholding, and also because I wasinvolved with the evaluation of total purchasing, isthat as others have said many times, a few do ittremendously well. I am sure some GP consortia willbe absolutely fantastic and beacons and put the PCTsinto the shade, but the real trouble, of course, ismanaging to raise standards across the whole of theNational Health Service. For that, this just seemsterribly risky.The truly alarming prospect here, as Jennifer andChris have said, is that we have five years of severefinancial restraint. We have something like three yearsof tumultuous reorganisation in which I am not surewho is looking after this, and then it will take two tothree years for the new reorganisations to bed down.Over this five years, when there is this huge financialpressure, we just don’t seem to be well equipped torespond to it.

Q247 Chair: Sarah is going to come in, but can I justask one specific question, which arose really from thelast session as well as from the answers you have justgiven? It addresses specifically the evidence availableof what results from GP-led commissioning in itsvarious forms. Would it be fair to say that the evidenceis primarily around relatively simple transaction-basedactivities—prescribing, elective care, referrals and soforth—rather than the more complex issues aroundemergency care and around pathways involving, inparticular, long-term conditions? Is there anyevidence, good or bad, of GP-focused commissioningdelivering significant change to those more complexissues?Professor Chris Ham: The way I would respond tothat is twofold. One is that most of the evidence, asyou say, is about the benefits you get from GP-ledcommissioning around elective planned care bringingmore services into the practice than would otherwisebe the case, because those are the bread and butterissues that are of most concern to most GPs in theirday to day work in their practices. The more complexthings around how you organise stroke services acrossa city so that you concentrate them to get betteroutcomes, or how you reorganise children’s services,as has happened in Manchester after many years ofdebate and discussion, are not issues that most GPcommissioners will have much expertise, appetite orconfidence in engaging with. You need anorganisation, which is the local, we would call it,system leader taking that strategic view, and able towork across a very complex set of hospitals and otherorganisations, to bring about those kinds of benefits.But the other way of answering the question is this.Both Jennifer and I in our respective institutions havelooked at the US experience, because there are a lot ofexamples in the States where, if you capitate medicalgroups—these aren’t just GPs; they are GPs andspecialists—what results do you see? And you do see,from the managed care era, that the incentives in thatarrangement do encourage physicians controllingbudgets to look at how they can avoid avoidable




emergency admissions to hospital and deal with morecomplex patients by putting in place case managementand services in the community to deliver those sortsof results.The caveat is that they often do so with very generousmanagement allowances, much more so than seemsto be the case for the emerging GP commissioningconsortia, and they invest hugely in developing theirGPs to take on the key leadership roles to make thathappen. It takes them many, many years froma standing start to be able to do so. One of the issuesthat is of concern is the speed at which these ideasare being put in place. They are moving in the rightdirection, but it is hugely ambitious to do so thisquickly.Dr Jennifer Dixon: I think your assessment is correct.I would just add a couple of things. The first thingis that some total purchasing pilots did actually trackpatients and arrive at the house when the ambulancecame in order to go to hospital, or to decide that thepatient didn’t need to go to hospital, or tracked anolder person around a hospital by putting a nurse in,paid for by the practice, to try to get them out asquickly as possible because that was better for thepatient and efficient. So there were some sporadicexamples of that. There is some evidence, but it isweak, that they then made some dent in the upwardrise of emergency admissions. It was not strongevidence, but there was some suggestion in the earlydays that that is what happened.The other thing that total purchasers and fundholdersdid was that they spent a lot of time building upprimary-care-type activities over which they had morecontrol than the hospital, to boost some of thoseactivities. But as Chris said, the big thing that is goingto sweep us is the need to close down hospital beds,effectively, or whole institutions, and there is noevidence that practice-based commissioning oranything from fundholding had any influence at all onthat big issue.The other thing was that they didn’t really engagewith hospital clinicians, which they need to do to getpatients out of hospital. There is very little emailcontact; there is very little phone contact. It’s the 1948Berlin Wall—still there, outside of a few specialties.If we are going to really make these efficiencysavings, we have simply got to get over thecontractual, budgetary, cultural, training andgovernance divide that separates general practice fromprimary care. So this is a provider issue, notnecessarily a commissioning issue.Professor Gwyn Bevan: I strongly support whatJennifer has said and there is the great division inBritish medicine between general practice andspecialist care. One of the early studies in the 1960sshowed how they communicated by mail only. It wasan observation that Alain Enthoven made in 1985 andit is what strikes American visitors today.On the point about more structural change, when wewere doing this evaluation of total purchasing, Iremember vividly a discussion with one hospital thatrelates to the point Julian Le Grand made that GPfundholders were able to move money aroundbetween hospitals. They said, “We are very happy togive them the average price for moving money around

because that is a limited part of our budget, but oncethey move into the whole of hospital care it isdestabilising to let that happen.” They found it muchharder to do the sort of structural changes that we aretalking about.

Q248 Dr Wollaston: We have heard from severalwitnesses about integrating health and social care,providing the best model for savings and alsodelivering better care; there are some very successfulpilots around the country, in Torbay, for example. Doyou think the White Paper puts models like that at riskor do you think it is likely to make it more likely tobe deliverable, and do you see the loss ofcoterminosity as being a really serious threat, and,again, the issue of a rigid commissioner/providersplit?

Q249 Professor Chris Ham: I think there are risks,inevitably, when you go through this kind of structuralchange with the established partnership arrangements.I know Torbay very well, and they have been workingat integration of health and social care, particularlyaround frail older people, with really excellent resultsfor many, many years. But it is based on the care trustnow being in place and the formal arrangementbetween the NHS and the local authority.If I can generalise from that particular example, thereare many of those formal partnership arrangements inEngland under the Health Act flexibilities. They takedifferent forms and they are all based on the primarycare trust and the local authorities having signed upto formal statutory arrangements. I am not aware ofwhat the plans are for the future of those formalpartnership arrangements. If GP commissioners, forexample, say, “Actually, we think there is a betterway”—I know some GPs in Torbay would say, “Wewant the nurse attached back to our practice ratherthan working in this integrated health and social careteam for a locality”—they may want to move awayfrom what they have achieved. For them, it might bea different model.The answer is we don’t really know what is going tohappen to health and social care integration. We doknow that there are likely to be some risks because ofthe structural change. I think a lot will hinge on thenew health and well-being boards that are going to beset up under the White Paper, the stronger role thatlocal authorities will have there, how they engage withthese nascent GP commissioning consortia, andwhether they are able to take forward thosepartnership arrangements in a positive way and notlose some of the really good examples out there.

Q250 Dr Wollaston: Would it have been yourpreference to have built on existing models of goodpractice?Professor Chris Ham: Absolutely. I think many ofthe laudable objectives set out in the White Paper,around patient-centred care, better quality and betteroutcomes, could be achieved through evolution, notrevolution. In the example that Jennie Popay gaveearlier—again, I know this from personalexperience—in Cumbria, which the Secretary of Stateis fond of referencing in support of his policies, they




are already doing, through the existing PCTpractice-based commissioning arrangements, what theWhite Paper would like to see done across the wholeof England under the current system. If you go toCumbria, if you go to Torbay and you can see theWhite Paper ambitions being delivered, surely wecould get there more generally without the risksassociated with such a “big bang” radical reform.Dr Jennifer Dixon: I agree with all of that.Coterminosity is a loss if it undermines integration ofhealth and social care. The White Paper is prettyopaque, as Chris says. Some of the issues about GPconsortia forming seem to be based on their affinityfor one another, and for me that is almost a coda thatpractices who don’t necessarily get on don’t have tojoin the same club. But there is the actual rub, becauseto have a step change in the quality andcommissioning of general practice you really need tomanage GPs. GPs need to be managed. It is verydifficult, as we know, within a practice to manageother partners, let alone to manage acrossa consortium. I think that is the thing that needs to betackled more than anything else.Professor Gwyn Bevan: I agree with what is behindyour question, which is that I think now there must bedoubt about the efficacy of the purchaser/providersplit. Other countries have gone away from this andabandoned it, although they started this in the 1990s,and integration—the sort of thing that Alain Enthoventalked about when he talked about GPs and specialistsworking alongside each other, sharing notes and allthat sort of thing—you just think that must be better.On the point about coterminosity, I remember vividlywhen I was at the Commission for HealthImprovement that we were trying to look at how wecould assess mental health care. With the move tocommunity care, these have become largeorganisations so one was covering two counties,which meant it dealt with a number of local authoritiesand a different number of primary care trusts, and itjust found it horrendously difficult to co-ordinatehealth and social care plus mental health.

Q251 Rosie Cooper: Have any of you beenconsulted by the coalition or made any submissions tothem in the development of this White Paper?Dr Jennifer Dixon: Not directly.Professor Chris Ham: We have made submissions.We responded to the White Paper.

Q252 Rosie Cooper: Yes, but not before the WhitePaper, i.e. to the coalition Government in theirthinking in outlining what is going on.Dr Dixon, I have four quick points and the fourth oneyou have already answered, which is that it is reallydifficult to manage any group of people, particularlydoctors, all independent contractors, and notnecessarily agreeing with them, and then from theconsortia upwards having a long distance to theCommissioning Board.To come to the two real questions I would like to ask,the first is the danger of PCT implosion, which is righton our doorstep now. The Secretary of State, andindeed Sir David Nicholson, talked to us about thetime between now and 2013, which would enable

consortia to get up and running, and the PCTs andstrategic health authorities will be there to supportthem. I would suggest there is an almost imminentimplosion there. What do you think the consequenceswill be? And could you perhaps address conflicts ofinterest in discharging the commissioning role withinconsortia and how that should be addressed?Professor Chris Ham: I think there is a risk aroundthe impact on PCTs because as we are already seeing,especially in London—this will be the best example—the NHS has said that it wants to move more quicklyto winding down PCTs, the rationale being to free upsome resource to invest in GP commissioningconsortia to enable them to develop more quickly andto take over the responsibilities of PCTs. Buteffectively it means that the existing PCTs will ceaseto exist in all but name from March, and we aretalking about March/April 2011, not 2013, and thearrangements in London will then be based on sectors,so five or six PCTs will be having to take on thatresponsibility.Inevitably, middle and senior managers in thoseorganisations will be thinking about their ownpersonal futures. We have a lot of people in the NHSwho thought they were coming in for a career, a jobfor life, who are now thinking about their mortgages,their financial commitments and their families, andhow all that is going to work when management costsare being taken out. It wouldn’t be surprising,therefore, if PCTs, whatever form they take in theinterim, were losing a lot of the talent and theexperience and expertise they need to manage thetransition effectively. That is what I think DavidNicholson has been arguing for the last six months inhis two major letters to the NHS on managing thetransition well to avoid the “implosion”, to use yourword, and to ensure that that transition occurs assmoothly as possible. So I think you are absolutelyright.On the conflicts of interest, that is a very negativeway—I know it’s the phrase that’s being used—oftalking about some of the issues around GPcommissioners. I put it more positively. I think theinteresting issue here is that the Government aresaying, “We are going to put the main primarymedical care providers in charge of commissioning”,at the same time as the Government are saying,“Actually, we want to make sure there is a realseparation between commissioning and provision.”There’s a kind of gap in their logic there, isn’t there?And what you would say, potentially, is you can usethat to your benefit, because if GPs have the ability toprovide as well as to commission, it gives them theopportunity to make, not just buy. A lot of the GPswe have talked to at The King’s Fund say the big prizearound commissioning is not writing more detailedcontracts with big acute hospitals and getting them tobe more efficient; it is the opportunity to use controlover commissioning to develop more services in thepractice, in the community, to avoid those avoidableadmissions. Sometimes that will involve practicesworking together with the community and nursingstaff, with social care, to develop better models ofprovision in the community.




Q253 Rosie Cooper: I don’t demur from that. I thinkwe have to deal with the perception that there isa really big conflict of interest and that any “profitbenefits” are actually for the health service and not forthe consortia and the practice.Professor Chris Ham: If you follow through the logicof that, one response would be, therefore, we needa very open, proper competitive tendering process.Any contract that a GP commissioning consortiumwants to let has to go through standard procurementrules. I hope none of us wants to see that, because youwould end up with telephone directory documentationaround making sure there is fair play and you avoidthose conflicts of interest. There needs to be a better,simpler and more transparent way of avoiding thelegitimate concerns that people have while ensuringproper accountability.

Q254 Rosie Cooper: On the boards of consortia?Professor Chris Ham: Through the mechanisms thatconsortia have to use in deciding how to use theirfunds, which would include the governancearrangements, as yet to be defined.

Q255 Chair: It does also leave open the question,doesn’t it, of how you deal with the areas that wewere hearing about earlier where primary care isn’tcurrently innovative, cutting edge, likely to rise to thekind of challenge that you describe. You describe whatan effective primary care commissioner does, but thenext question is who commissions the primary carecommissioner?Professor Chris Ham: Indeed. If you say that theproblems with the NHS and performance require morechoice and more competition to avoid providercapture, shouldn’t the logic be, well, maybe choice ofcompetition should apply on the commissioner side aswell as the provider side rather than ending up withgeographical monopolies of GP commissioners?There are big debates there, but you can see the logic.Professor Gwyn Bevan: I have been working with ascholar in the Netherlands on the development of theirmodel of insurer competition there. I am enthusiasticfor more integration between primary and secondarycare because the evidence is that that is beneficial. Butwe also know in the United States that there aremodels of these fantastic high-performingorganisations like Kaiser Permanente, but when theytried to spread that in the 1990s it failed and there wasthis backlash against managed care, with some ofthem being dysfunctional. The troubling thing is thatif we were to move away from the purchaser/providersplit towards integration, which I favour, but youdidn’t allow people choice, then they could be stuckwith a truly dysfunctional organisation. Althoughwhen Alain Enthoven proposed an internal market hewanted the Kaiser Permanente model in England andthought choice would be politically unacceptablebetween them, I now think, given the evidence wehave in the 1990s, that is undesirable.In the Netherlands they have moved towards insurercompetition, but it is a quite complex process to getright, with a sophisticated regulatory regime, and ittook them 20 years to do it. It may take even longer

than Martin Roland’s two Parliaments if we want todo it.Dr Jennifer Dixon: On the integration business, ifyou integrate across health, primary and secondary,then, as you say, there still has to be somecommissioner at some level. The reason why all thisis blurred is because if you have integrated networkstaking on a capitated risk fund, effectively, thosephysicians or clinicians inside that organisation areindeed commissioning; they are making or buying—okay? So they are doing what you want them to do—the principle. Somebody then has to not just allocateresources directly to those people but needs tocommission from them and hold them to account, andthere are a variety of ways of doing that. Inside theseintegrated care organisations we know some of thefeatures that make them work in the United States,which goes back to your question about incentives andconflicts. The best ones are pretty clear that they don’thave very much personal remuneration as anincentive.For example, Denis Cortese of the Mayo Clinic cameover here recently. He was absolutely adamant thatthey pay everyone’s salaries, and the added incentivescome from professional incentives; they arenon-financial. It is about doing a better job, theworking day being easier, better quality care forpatients, reputation enhanced, and those seem to beincredibly powerful.Kaiser used to have huge extra pay—something like20% to 25% extra pay for clinicians if they did a goodjob and didn’t spend up to the budget, and then theythought that that perverted professional behaviour sothey then scrolled back to something like less than5%. Sure, professionals do need to be incentivised todo this type of stuff and manage budgets well, butthere may be other ways that actually are pretty strongthat are crafted inside the organisation—not anexternal pressure coming from contracting, fromregulation, or indeed from some command or controlor community group—that relates to information,shared governance, clinical leadership and alignedincentives. Those sorts of things can be as powerful,if not more so, as we have seen in the United Statesin a highly competitive arena.

Q256 Yvonne Fovargue: I want to go back to choice.At the heart of this is supposed to be patient choice,and we have heard that, in fact, obviously the morearticulate have more choice. Do you believe that thissystem will actually reduce or increase inequalities inthe service?The other thing I want to ask about is the market beinginvolved. Of necessity, we have heard that someproviders may well be squeezed out of the market.How will that affect perhaps the more disadvantagedareas and the people who depend on those services?Professor Chris Ham: On the choice issue we, at theKing’s Fund, published a big review of the experienceof patient choice under the previous Government. Itcame out about six months ago, and I think it showedthat we are in the foothills. Although there has beena policy for a number of years now to give patientsmore choices at the point of GP referral and at otherstages in the system, patients’ awareness of that and




GPs’ willingness to support patients in exercisingthose choices is very variable and actually in someplaces quite limited. I don’t think it is because offundamental opposition to the idea. It is just that ittakes time for these ideas to get traction.One of the things that came out from that work wasto say, “If this is going to be part of the health policyreform programme in future, we need to do a lot moreto raise awareness of the existence of choices, toprovide really good information to support people tomake choices and maybe to provide more advice andsupport for patients when they are in that position.”There are some groups in the population who will findthat relatively easy to do and others—I think this iswhere your question is pointing—who will need moreadvice, more support and more confidence to be ableto realise the potential of patient choice.Professor Gwyn Bevan: This is one of the points onwhich Julian Le Grand and I have a continuingdisagreement about the efficacy of choice as aninstrument of change. No one is arguing aboutwhether you should have choice, and it is right thatwe have gone away from a system in the NHS whereyou had no choice at all. But there is choice inprinciple and there is choice as a lever of gettingbetter services.There are systematic reviews in the United States forputting information out on a hospital’s performance.They consistently find that people do not switch frompoor to high-performing hospitals. One of theparadoxes about the New York study where theyissued data on risk-adjusted mortality rates for cardiacsurgery is that patients continued to go to hospitalswith high mortality rates. But by publishing theinformation, the hospitals got better. The most famouscase is Bill Clinton, who had his quadruple bypass ina hospital that the information said at the time wasone of the two worst outliers in the whole of NewYork State he could have gone to.The other evidence relates to the point Jennifer wasmaking earlier. It is reputation—putting stuff out inthe public domain, and putting pressure on providerswho are performing poorly—that is the one thatcauses them to respond to that. When I was at theCommission for Health Improvement, I was actuallyinvolved with the star-rating exercise and there’s avast amount of evidence showing that to be very, verypowerful in driving improvements. So I am scepticalabout choice as a driver of change.Then you get into the further problem that if choicewere to be effective and money moved, then thepeople who will suffer—it is your concern—is thelocal population. If you have a poorly managedhospital and it is in serious financial difficulties, it iseven worse and the people who can’t go elsewherewill have to keep going there. There are these issues.I remember this being raised by Ken Jarrold at thestart—this was in 1991 when Working for Patientscame out. We know what the high-performinghospitals look like but what about those who suffer inthe marketplace? It is a serious problem.Dr Jennifer Dixon: People need support, and somepeople need more support than others; that’s for sureand that should be in the system. Patient choice at themoment is too anaemic to prod providers into better

performance, which is where we need to be for theNicholson challenge. It is not going to work any timesoon. It is important to have, but it is not going to bea major instrument for efficiency or effectiveness,I don’t think, and in the meantime, as you say, thereis a lot of turbulence going to go on. There needs tobe some regulatory or some national oversight as towhat is happening on access to care, some processmeasures during the next transition period, becausethere could be quite a lot of chaos going on in termsof some services disappearing, cuts here, there andeverywhere, which could systematically add up toa poorer service in some parts of the country. Sosomebody somewhere needs to be monitoring that.Who that will be, whether it is the CQC or whether itis the Board, is not clear yet, and also what teeth theywill have to do something about it.

Q257 Valerie Vaz: Politicians sometimes are a bitdisingenuous. We’re always saying we want to dothings in the people’s name, but I was just wonderingwhether you think Joe and Josephine Public on theClapham omnibus are part of all this, whether we havetaken their views on board, and whether you have anyevidence that they are engaged in this process.Secondly, do you have the latest figures on how manyGPs want to be part of consortia, because there havebeen a number of polls out to say that many of themdon’t want this? And, thirdly, £80 billion of publicmoney is going to be in their hands. How do you seethe accountability of that money when GPs obviouslyhaven’t been elected?Lastly, Professor Ham, could you outline what is sogood about Cumbria? I don’t know about it and I’venever been there, so it would be helpful if you couldoutline the best practice there.Professor Chris Ham: Okay. Let me pick up the lastpoint. I will leave the other easier questions to mycolleagues.Cumbria is really good because for a number of yearsSue Page, who is the chief exec of the PCT inCumbria, has been an advocate of more integratedmodels of care in the way we have been discussing.She has sought to devolve as much budgetary andother responsibility to a locality level. Cumbria isa county of—what?—500,000 people. They have sixlocalities. Those localities are the units forpractice-based commissioning, which will be renamedGP commissioning at some point in the next two orthree years, and Sue and the PCT have been stronglycommitted to pushing as much responsibility out thereas the GPs are willing to take on. They have somegreat GPs in Cumbria and they have been wanting totake on more responsibility year on year, not just fora commissioning budget but, as I said earlier on, sothat they can use their commissioning budget then todevelop these new models of care, making use of theirlocal community hospitals, providing more services inthe practice. They have an example of integrateddiabetes care in Cumbria, where they have a specialistto come out of the hospital to work in the communityto support the practices to be better at routine diabetesmanagement so that only the most severe patients thenend up being referred to the local acute hospitals.




As I say, I think that is very similar to what theSecretary of State for Health would like to see happenin the whole of the NHS in England in three or fouryears’ time, and it has happened because you havea visionary PCT with a chief exec who has thoughtabout the model of care, has some great GPs and hassupported them and given them training anddevelopment opportunities to go away and dowonderful things—and they are.

Q258 Valerie Vaz: So you don’t really need thereorganisation to get good practice like that?Professor Chris Ham: The problem is—if theSecretary of State were here and I wouldn’t want toput words into his mouth—that not every PCT is likeCumbria, not every chief executive has that samevision, and that is just a generic problem across thehealth service. We have wonderful examples ofinnovation in many aspects of care—Torbay being agood example around health and social careintegration—but they are exceptional, isolatedexamples.

Q259 Rosie Cooper: So sharing the chief executive’svision could help us achieve this without the “bigbang”?Professor Chris Ham: Well, yes, people matter much,much more than structures.

Q260 Rosie Cooper: Absolutely, which is why I amjust left frozen in this process because I can only seeparalysis. I used to work in Littlewoods and we hadthis up-down structure, it was fantastic, and then achief exec came along and talked about matrixmanagement. So then, suddenly, we were allresponsible to each other, going across as well as upand down. Nobody knew who the hell we wereresponsible to, what we were doing, and it was nota good system. I can see us going into that here—so much going on, money being required, efficienciesbeing required, the “big bang” structural system. Veryquickly I would like to ask you, are we all—Valerie Vaz: After me, Rosie, after my question.

Q261 Rosie Cooper: But this will answer it. Whatwill the NHS look like in 2014?Professor Chris Ham: In 2014?

Q262 Rosie Cooper: Yes.Professor Chris Ham: When you say “look like”,what do you mean—the structure or the service topatients or something else?

Q263 Rosie Cooper: How will the patients see whatis going on around them?Professor Chris Ham: I think you can construct anoptimistic scenario or a pessimistic scenario orsomething in between.

Q264 Rosie Cooper: What is your scenario?Professor Chris Ham: At the King’s Fund, and I thinkJennifer has echoed this from the Nuffield Trust’sperspective, we think that there are significant risks ingoing so far so quickly, even if the objectives thatthe Government are pursuing are absolutely the right

objectives. The risks are around the transition andlosing experienced managers to maintain the financialcontrol, the control of performance, keeping waitingtimes short, and so on, over the next two or threeyears, while creating the as yet non-existent GPcommissioning consortia to take on responsibility for£80 billion of public money, as you were saying.The reason that is actually revolutionary and notevolutionary is that although it is very similar toprevious primary care-led commissioning initiatives,we have never before been in the position where somuch of the financial responsibility rests with the GPs.I hope I am wrong. I hope we can navigatesuccessfully during the transition and there will bepatient benefits at the other end, but none of us canbe sure.Professor Gwyn Bevan: I think where we will be in2014, as I said before, is there will be a small numberof GP consortia that have done fantastic things, thenthere will be the rest who are still in a state of shockand some where it is dreadful. The thing is that withthe pressures you are under, obviously, on the onehand you would like to get it done fast, becauseotherwise the clock is ticking in the financial crisisand every year you delay the pressures get more andmore intense. Leaving it for three years means it isgoing to be horrendous when they actually get in aposition to do something. But if you take too longover that, then it is going to get even worse when theyget there—with limbo and blight from reorganisation.Words fail me at this point, so I’ll shut up.

Q265 Grahame Morris: I have a fairly shortquestion for Professor Bevan, hopefully, in relation tosome of the issues around identifying what theevidence base is from overseas. You mention in yourevidence the dangers of the NHS going down theDutch road, and I am particularly thinking within thecontext of some of the earlier contributions fromProfessor Popay about material aspects of choicewhere there isn’t free choice of GPs or services,particularly for areas where there are issues aroundhealth inequalities. What do you mean precisely bythe risks of going down the Dutch route?Professor Gwyn Bevan: There was this famous healthinsurance experiment by RAND that randomlyallocated people to different kinds of insurancecoverage and showed that the integrated careorganisations, the Group Health Cooperative of PugetSound, was more cost-effective and had betteroutcomes for all except the poor and seriously ill.People thought, “What we need to do is to replicate.That is the secret. We’ll just get that to happenthroughout the United States.” Alain Enthoven sawthis as the way they would get universal coverage ata price they could afford, and then they discoveredthey couldn’t.It is very, very hard. The things that Jennifer hasdescribed—what they have looked at, and the waythese organisations work—have taken them decadesto work out how to do it. They have a particularculture and they carefully select people who workthere. The idea that you can just roll that out andcreate an organisation in which GPs and specialistswork together with a capitated sum and, there you are,




you’ll get Kaiser Permanente in two years’ time, weknow just doesn’t happen. The problem is that if yougo for integrated care without choice you could betrapped in a dysfunctional organisation.I wasn’t talking about the dangers so much of theDutch system. The Dutch system works quite well andthey do have choice of insurer, and the Dutch systemcould evolve where you do have choice betweenintegrated care organisations. But I am saying thatagain both these models—both the high-performingintegrated care organisation and managed competitionbetween purchaser or commissioner—are quitecomplex things to evolve and they take a lot of timeand development to get there.Dr Jennifer Dixon: On the story about the integrationin the US, there are probably about 10 highlyperforming integrated organisations in the US, andthere has been a study about why they haven’t beenable to transplant to different states. The biggest onewas why Kaiser California, which was incrediblysuccessful where it started, did not transplant to NorthCarolina. The story there was that it wasn’t the modelthat was the problem: it was the environment in thestate that was hostile. The regulatory environment, theprofessional environment, the financial environment,was not conducive. It is almost as if you have gotthese seeds that were flung on to stony soil.There’s an issue for us here, if we do go down theintegrated route, that we have to make sure the soil isfertile enough to let it have a chance to grow. That isa complex issue—interplay between what theregulatory environment is, what the paymentmechanism is, what the medical and training cultureis, and do they get in the way of integration and so onand so forth.

Q266 Chair: Presumably, to pick up Professor Ham’spoint, it is also about people as well as structures?Dr Jennifer Dixon: It’s about people. The other bigthing about these organisations is that they can selectin people who have the same mission, and that reallymakes them fly. If you can’t select in or, conversely,deselect out people with the wrong mission, theydon’t fly.

Q267 Valerie Vaz: Can you continue with myquestions?Dr Jennifer Dixon: Yes. Yours was about engagementof the public in the reforms?

Q268 Valerie Vaz: The public and the GPs, whetherthey want it, the latest figures on that, and theaccountability of £80 billion of public money.Dr Jennifer Dixon: With the engagement, I don’tknow. I haven’t seen any evidence that the public havebeen involved in the crafting of these reforms andwith the top-down national system that we have, it isvery difficult to involve them. If we want to involvethem, we should have a different way of going aboutthings.I have seen various surveys that run along that 20%of GPs are quite interested, but those are BBCsurveys. So it will be the minority, but you don’t needevery GP to be enthusiastic. You just need a few tolead and bring the others along, but it does help if

more are enthusiastic. The incentives for GP consortiato take part do not seem to be as strong as those infundholding, so again they are asking the question,“Why should we?”Yes, the accountability of the money is a severe issue,isn’t it? With PCTs, there is no evidence to suggest,the way these consortia are set up, that they will beany more successful than PCTs were before them atcontrolling costs and expenditure and extractingvalue, and PCTs had a long way to go, even thoughthey have been formed for several years.Professor Gwyn Bevan: Can I follow that up? Welooked at this in the total purchasing pilot, which iswhere the GP fundholders could opt to take on a largershare of the hospital and community health servicesbudget. As it happened, in the pilot some of thesewere single-practice fundholders that had taken ona wider purchasing role and others were networks ofquite large populations, something like 50,000 to100,000. It is one of these things that is obvious afteryou have found it, but we found that if you have theGPs in the single-practice total purchasing pilots theywere involved in managing budgets, but once you gofrom one practice to a network it was much moredifficult to get them involved. That led to theparadoxical finding that in terms of managing risk ofreal costs of their referrals, the larger networks,although they had a bigger population, were no betterthan the single practices because it is about getting theGPs involved in the process. Of course, these wereGPs who had actually opted for fundholding, taken onbudgetary responsibility and opted to extend it to totalpurchasing, and now this proposal is to uniformlyrequire all GPs to get involved in this, so it is goingto be a major challenge.Professor Chris Ham: One thing we haven’t touchedon, which we think is really positive, is theGovernment’s commitment now to develop thepathfinders among GP commissioners, which wasn’tin the White Paper but has come out in the recent past.It is to be able, if you like, to develop proof of conceptin some parts of the country by enabling theenthusiastic GPs, working with supportive PCTs, touse next year and the year after as shadow years tolearn some lessons. That seems to us to be a verycommon-sense way of going about it.Chair: Chris Skidmore would like to ask somequestions about the Commissioning Board.

Q269 Chris Skidmore: Dr Dixon, I was intriguedthat in your evidence you said, “We anticipate that theNHS Commissioning Board will quickly become the‘headquarters of the NHS’.” To what extent is thiswhole process smoke and mirrors? We have seendevolution of power down towards doctors’ surgeries,GPs and consortia, and at the same time theCommissioning Board will have an enormous swayabout how these consortia are run, deliveringoutcomes and for their financial performance inparticular. You also say in your evidence that you areuncertain as to what extent the Commissioning Boardwill be able to truly remain independent of theSecretary of State.I would like to get the panel’s view on theCommissioning Board, whether this is actually going




to centralisation, in effect, with the CommissioningBoard running the NHS rather than actually theconsortia having true freedom to commission?Dr Jennifer Dixon: Of course, in the White Paper itsays explicitly that the Commissioning Board will notbecome the headquarters of the NHS, but I guess thereason why we put that in is because we think that ifGP consortia are too green, effectively, to be able tomanage expenditure, then effectively what happens isthat someone will have to step in. The less tractionthere is with consortia, the more that theCommissioning Board will have to exert itself. I think,if things go pear-shaped, it could really have to takeon quite a large role, and it has the mechanism to dothat because the consortia will be statutory NHSbodies with a performance management line straightto the centre.The intention is the right one for devolution, but giventhe financial squeeze we are now in—we are not infive years ago; we are in a different land now—that isthe worry. Yes, like many people, I have longstandingissues about whether there can ever be an independentboard separate from the Secretary of State. And notonly that, but there could also be unresolved conflicts,unless this is carefully crafted between theCommissioning Board and also the economicregulator, whose objectives may not be the same. Thathas to be thrashed out pretty carefully.

Q270 Chris Skidmore: Professor Ham, would youlike to comment at all?Professor Chris Ham: The issue of having an arm’slength board separate from the Department of Healthhas been around for as long as I have been around,and that is saying something. Every time it has beenlooked at before, the decision has been that it isprobably not a runner because if you need to ensureproper accountability to this place for spending £100billion of public money, can you offshore that toa National Commissioning Board even if you put inplace proper arrangements for that to relate to theDepartment of Health and the Secretary of State? Thistime round, the argument seems to have been won andwe are going to go in that direction, but as always,the devil is in the detail, particularly the relationshipbetween the National Commissioning Board on theone hand and the Department of Health and Secretaryof State on the other. Exactly how is that going towork? How can we avoid the kind of MichaelHoward/Derek Lewis challenges of the Prison Servicefrom a number of years ago?Then, secondly, what about the relationship betweenthe National Commissioning Board and howevermany GP commissioning consortia we have? I won’tspeculate on the number, but my expectation is thatthere will be more GP commissioning consortia thanthere are PCTs at the moment, and therefore there willbe quite a big span of control between the NationalCommissioning Board and those commissioningconsortia. There will be regional office structures, alsoknown as strategic health authorities, in some shapeor form, to mediate that relationship because therealways has been an intermediate tier at the regionallevel since 1948 onwards. Why would this be anydifferent from that? So that kind of looks like we are

recreating, but putting different names on the door,some of the elements of the system we have at themoment.

Q271 Chris Skidmore: What does the panel thinkabout the fact that the new GP contract with the BMAis going to be negotiated by the NHS CommissioningBoard rather than the Department itself?Professor Chris Ham: It is a continuation, isn’t it?When I had my four and a half years—it sounds likea prison sentence and it felt like it at times—as asecondee in the Department of Health, at that time theGovernment, in its wisdom, said it wanted the NHSConfederation, through what we now call NHSEmployers, to take on responsibility for negotiatingcontracts, not with doctors—well, actually withdoctors to some extent, because that is part of themechanism we now have. It was one of the elementsaround distancing Government, and DH in particular,from some of the detailed issues that the NHS intheory was better placed to deal with. Thisarrangement around the GP contract you could see asbeing a continuation of that. I don’t think it removesfrom the table any of the complex issues that willundoubtedly be involved in renegotiating the contractas that goes forward from here.Dr Jennifer Dixon: I just wanted to add something,and it is slightly different from the question you asked.It is about the ability of the Commissioning Board tomanage some of the local contracts, the PMSs and thelocally enhanced services, which are additions to theGMS contract. So 60% of the country at the momentis GMS and 40% is PMS. There is quite a lot goingon locally that is a very long way away from evena region actually, so how a board can do thissensitively in a way that reflects local needs forprimary care provision is again opaque.

Q272 Nadine Dorries: Going back to your earlierpoints about how groups of people are difficult tomanage, do you see that it will be viable and usefulfor the negotiations taking place at the moment forthere to be contracts which are not dedicated to GPsbut to the consortia, so that there is a consortiacontract directly with the Commissioning Board ratherthan a GP contract?Dr Jennifer Dixon: Yes, I agree with the otherwitnesses that there should be a consortia contract, notwith practices. It is just unmanageable at practicelevel, I would think, and the consortia really shouldbe more actively managing primary care provision,which may be a reason why some GPs don’t want toget involved in it, because it’s hard. But, effectively,that is the single biggest thing that the consortia oughtto be doing.

Q273 Nadine Dorries: There is a resistance.Professor Gwyn Bevan: There is an issue around thisbecause it is my understanding that within theconsortia the practices can choose to move betweenconsortia, so when we discuss how we allocateresources to the consortia, it starts with the practice asthe building block. If you were to negotiate a contractwith a consortium and then a practice decided it was




going to move, that would then become enormouslyclumsy and you would have to renegotiate.

Q274 Nadine Dorries: Except that it looks asthough, just on the information that we are goingthrough at the moment, the consortia are more or lessgoing to fall on a county or county-wide basis. Itwould be tricky for one to move from one consortiumto another if they were on a county basis; it would bea highly unusual situation.Professor Chris Ham: Do you mean the contract forprimary medical care provision to be with theconsortia?

Q275 Nadine Dorries: Yes. The negotiations aretaking place between the Department of Health andthe BMA, and the NHS Commissioning Board will bethe actual holder of the contract between theDepartment of Health and the GPs. It will go to theCommissioning Board, directly to the GPs. Myquestion is, does it not seem more sensible, rather thanindividual GP contracts, if the consortia had onecontract because that would possibly provide scopefor savings also but would be just much simpler inmanagement? Dr Dixon raised the point a little whileago about personalities and how individuals would bedifficult to manage, but consortia would be easier tomanage than individual GPs.I want to put a point that was raised with me lastweek. At the moment the timing may not be right andthere is a generation of GPs who would be absolutelyresistant to this—who will probably, as a result of this,be falling off the edge in terms of this is not going tobe for them—but a new generation of GPs are comingthrough enthusiastically who now find GP practicea more interesting sphere of medicine to go into andthey would be more amenable to that kind of thing.I suppose the timing is probably the issue.Dr Jennifer Dixon: Yes, and actually the youngerGPs may be less interested in a GMS contract. Theydon’t want to become a partner; they actually want tobe salaried and have flexibility. They don’t want tobuy into a mortgage for life in a practice. It could bethat GMS withers away anyway as more people leave,and it could be also that some of the GMS practicescould be bought out or traded. At the moment that’snot allowed, but it could be that consortia could takeon this role to remove some poor performers, or atleast to bring them under performance managementthrough a different route.

Q276 Chair: Marketability of GP goodwill might bea dangerous subject to raise at 6 minutes to 1.Professor Chris Ham: In concept, of course, youcould do it. The practicalities are twofold, aren’t they?One is that it would pull the rug very firmly fromunder the BMA because a large part of its raisond’être is to negotiate a contract on behalf of GPsacross the country.Nadine Dorries: Absolutely.Professor Chris Ham: You may see that as being agood thing or a bad thing; I wouldn’t want topre-judge that.Nadine Dorries: On the basis of what happened a fewyears ago, I’d say it was probably a bad thing.

Professor Chris Ham: Okay. The second thing is interms of the psychology. If I am a GP with a GMScontract at the moment, thinking about whether itwould be beneficial to me to have that contract heldby the commissioning consortia in future as opposedto the current arrangements, I think it would dependa great deal on who I saw leading the commissioningconsortia where I was practising in future. If therewere really respected, credible GP leaders and goodmanagers there, it probably wouldn’t make a hugeamount of difference to me, but if the opposite weretrue then I think there would be a lot of antibodies inthe GP community because what this does is tochange the whole dynamic within general practice.You are getting one group of GPs to manage and leadall the other GPs and, as I say, there could be anupside to that but there could be a real downside too.Chair: Grahame wants to ask a quick question andthen I think we are probably coming to a close. Rosiewants to ask a quick question as well.

Q277 Grahame Morris: It is just in relation to thehealth and social care provisions and the £1 billion ofresource that is being transferred from the NHScapital budget. If this transfer to social care is anintegrated model of care, particularly thinking aboutcare of the elderly, older people, where the purchaser/provider split perhaps is not advantageous, should wereally consider that is part of the NHS, or is this partof a partnership that Dr Nixon referred to between theNHS and local government?Professor Chris Ham: My view on this is that I thinkit is, on the whole, a good thing that this has beendone around identifying some of the NHS funding tosupport social care, because I think the NHS is goingto be under huge pressure anyway, but without thatflexibility, the ability to discharge patients at the righttime, to free up beds and to enable admission fromA&E would be much more challenging. It raises thebigger question as to whether we should sustain thisbudgetary and organisational division between healthand social care. If you go back to examples likeTorbay, which has the care trust and they have brokendown those divisions certainly around adult socialcare, although not around children’s services, theirexperience is that they have invested health money toincrease spending on social care because that isa better way of keeping people independent and livingin the community and avoiding avoidable admissionsthan more investment in health and medical careservices.The caution here is let’s look at Northern Ireland,which has had a fully integrated health and social caresystem for many, many years, but it’s a structuralintegration, not a real service, and clinical integrationin many areas, and that really isn’t the solution tothese problems. You have to get the teams workingtogether on the ground. It is back to the people whowill make it happen rather than the structures.

Q278 Rosie Cooper: Finally, could Dr Dixon give usher view of 2014?Dr Jennifer Dixon: Yes. I think this partly rests onhow successfully the NHS will be able to controlexpenditure while maintaining a decent level of




quality and access. I just fear that the rapidity of allthese changes will mean that the NHS could be indanger of slightly being overtaken by events, that cutsand discontent will be high and that there will bea retraction to central control of the type we have seenin the past. So 2014 may look surprisingly familiarto us.

Q279 Chair: There is precedent for that analysis.Thank you very much. Are there any issues that youthink we have glossed over that you would like todraw out?Professor Gwyn Bevan: There’s one thing I shouldhave mentioned which is in my evidence. We havebeen doing work funded by the Health Foundation tohelp—it was and still is—primary care trusts, but Istill think of them as on the way out really, to setpriorities. We worked with Sheffield last year to helpthem move money around. In one service—eatingdisorders—the lead was sure things weren’t right, andworking with stakeholders, patients, the localauthority, providers from the charitable sector, etc., we

found ways of moving resources so they got betteroutcomes at reduced cost. We were hoping to continuethat next year, but it is in abeyance now because PCTsare being reorganised. That is at the back of my deepconcerns about this. Through this reorganisation weare losing time to get to grips with what the NHSreally has to tackle.Dr Jennifer Dixon: I have a very practical issue.There was a question earlier about what the right sizeof the consortia is and the size is different accordingto what is the issue to be discussed, but one of them isrisk-sharing. I just wanted to say that it is an empiricalquestion rather than a value-based question what sizethey need to be to take on what level of financial risk.In fact we are doing some modelling at the momentto decide that. Some practices of GP consortia will betoo small to take on a lot of purchasing of services,and that will have to go back to the CommissioningBoard. So it’s an empirical—you don’t have to havea finger in the wind.Chair: Thank you very much for your time.

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Members present:


Rosie CooperYvonne FovargueAndrew GeorgeGrahame M Morris

________________


Witnesses: Dr Peter Weaving, Cumbria PBC consortium, Anthony Farnsworth, Torbay Care Trust, NigelEdwards, NHS Confederation, and Dr Paul Zollinger-Read, Commissioning transition lead for East ofEngland SHA and interim Chief Executive of Peterborough PCT, gave evidence.

Q280 Chair: Gentlemen, thank you very much forcoming this morning. I think we might start. Could Iask you to begin by introducing yourselves so we areall aware of who you are and where you come from?Anthony Farnsworth: I am Anthony Farnsworth. Iam the Chief Executive of Torbay Care Trust inDevon and Director of Social Services for the samearea.Nigel Edwards: I am Nigel Edwards. I am the actingChief Executive of the NHS Confederation.Dr Peter Weaving: I am Peter Weaving. I am a GPand a commissioner for NHS Cumbria.

Q281 Chair: There is one general question we wouldlike to start with before we go off into the detail. Oneissue that has been of interest to the Committee sincewe started this inquiry on commissioning and aparallel inquiry we are doing into the health and socialcare spending programmes is how the twoprogrammes of change going on in the health servicerelate to each other. What I mean by that is that wetend to refer to one as “the Nicholson challenge”,that’s the £15 billion to £20 billion efficiency gainover four years, and that is going on in parallel withthe White Paper process for changing the structures ofmanagement in the health service.We had an evidence session last week which theSecretary of State and Sir David Nicholson attended.During that evidence session, Sir David set out aprocess of transition which involved the clustering ofPCTs to manage a process of change during the periodbetween now and the full implementation of the WhitePaper process, and that was the means by which hesaw it as realistic to deliver the 4% efficiency gainwhich is the underlying reality required from theNicholson challenge. Would each of you like tocomment on that process of clustering? Does thatrender the clusters redundant at the end of the processand what conflicts do you see emerging during thetransition process if you have got clusters forming onthe PCT side and the emerging GP consortia at thesame time?Anthony Farnsworth: I would not pose theemergence of the consortia and the development ofclusters as antipathetical to each other. I think theyneed to be done in a complementary fashion. Theconsolidation of commissioning capabilities inclusters of PCTs is probably a very wise insuranceagainst some of the risks of managing the two big

Mr Virendra SharmaChris SkidmoreValerie VazDr Sarah Wollaston

programmes of change that you have highlighted.Many of the skills are rare and many of them needimplementing at a scale. It would be a great waste ofthe commissioning talent that there is in the NHS if itwasn’t used. It is how that is done, though. If it isdone in a fashion that attempts to impose or commandthe emergence of the developing GP commissioningstructure, I suspect it will build in a dysfunctionaltension. It needs to be done with the GPs, the GPcommissioning consortia leading and driving it fromthe start. That is the best prognosis for a successfulcomponent of the transition.Dr Peter Weaving: The experience from Cumbria isthat we have gone down this route already in the sensethat we have had evolving GP consortia. AlthoughCumbria is running as one consortium, it is dividedinto six localities, each with a population of about100,000, with clinical leaders there. What we haveseen as they have developed, and the publiclyconsulted plan to improve healthcare in Cumbria hasbeen implemented, is that our healthcare costs havecome down. We started in a very sorry place, with£50 million in debt, the public marching on the streetsand a lot of unhappiness about healthcare. We haveturned that around. We have achieved financialbalance for the last three years but, more importantly,we have seen a fall in important areas of spend, likeemergency admissions and prescribing costs, whichare the lowest in the north-west region. Indeed, goinginto the future, where I would see the real £20 billionsavings coming from is the inefficiencies we still havein what we spend, in the sense that even within ourlowest prescribing costs, I know that the variation inthat sum between practices can be 100%. Thosedifferences are not driven purely by healthcare need—a lot of it is clinician behaviour. So in terms of takingus forward, I would see us continuing to evolve as weare and feel that that is going to deliver us the benefitsand the financial savings that we need to see as ahealth economy.Nigel Edwards: Of course, part of the Nicholsonchallenge, as you know, is a pre-existing commitmentto reduce management costs which has beenintensified and accelerated and I think the intention isto front-load that reduction. So, in a sense, there arethree different challenges, any one of which wouldbe a major issue for a management organisation. AsAnthony was saying, the proposal to produce clustershas the distinct benefit of dealing with a group of staff



30 November 2010 Dr Peter Weaving, Anthony Farnsworth, Nigel Edwards and Dr Paul Zollinger-Read

who have specialist expertise that we probably wantto retain but it is not clear at the moment where theymay end up. I suspect that they may end up beingemployed by more than one consortium because theyhave expertise in particular types of commissioning.Thinking about their position, they will not want to bewaiting around for one or two years to see whethersomething might turn up. So there is an argument inmoving rather more quickly in this direction to createthese consortia so that the GP consortia have a choiceof some good talent and, more pragmatically, avoidingthe necessity for what would probably be a very niceredundancy bill—I am guessing, but over £1 billionworth of redundancy just for that group of staff, nevermind other staff in PCTs. As a strategy, it makes adegree of sense.There is a bit of a problem, and we are caught betweenthe devil and the deep blue sea here, which is thatsome places have lost significant numbers of staffalready. You have this group of staff who need somecertainty so you need to act quickly. But we do knowthat merging organisations is also a risky and messybusiness, always with the hazard that people becomedistracted in terms of getting some organisationintegration and doing that piece of work. So you endup with, possibly, not two challenges but four. I can’treally see a way out of that, given where we are now.If we were having this conversation nine months ago,one could have perhaps suggested some differenttrajectories, but that is somewhat academic now.

Q282 Chair: You are saying that you regard it as apractical way forward and, in effect, the only wayforward.Nigel Edwards: Yes, but not without some challenges.

Q283 Chair: I guess my supplementary question iswhat do you think is a realistic timescale? Once again,Sir David said last week that for everyone who askedhim to slow down there was another who emphasisedthe importance of getting on with it, in particularagainst the background of the requirement to deliverthe efficiency gain starting from next year.Nigel Edwards: And both viewpoints are right, insome ways.Chair: That’s not a very clear guide to action.Nigel Edwards: I know, and this is a problem. I havea lot of sympathy—I don’t know if my colleaguesagree with me—with the situation he finds himselfhim. The advantage of going fast is we can givecertainty to people we need to keep and someindication to people you don’t want to keep that thatis the way the future is and they can start to have abit of certainty, and they can focus on doing the jobrather than worrying about their future which is apowerful point. Going faster also sends a signal to GPconsortia that people are serious about this and theycan get on and formally start to choose those people.I’m not so convinced that there’s merit in slowingdown. Once you have announced that you’re doingthis, history suggests that the NHS and the NHS stafftend to implement things faster and people alreadyassume that the future is coming and act accordingly.In a sense, you could not now announce that we aregoing to slow down very easily, except, perhaps, if

you have particular places with problems where youneed bespoke solutions and you need to be clear topeople what those were and what the process for thatis. But I think a national slowing down of this wouldprobably cause more problems than it createssolutions.Dr Peter Weaving: One of the lessons the evolvingconsortia learn very quickly is that they need verystrong and good support services so they areextremely unkeen to see good people leave theorganisations?Anthony Farnsworth: One of the things we havedone in Torbay recently was to merge the PBCconsortium and the board of the care trust into a singleorganisation. The chair of the PBC consortium is ourdirector of commissioning, so we had already begunan “in the igloo” solution to how the transition wouldbe managed with other GPs, which they wereenthusiastic about. A direct answer to the first part ofyour question is that I firmly believe there are bigbenefits to be had from engaging GPs, and consultantsfor that matter, in clinical redesign and leadership ofchange and that includes decision making aboutcommissioning. The sooner we begin to capitalise onthose benefits the better. To send a delaying signalwould, as Nigel has implied, send all sorts of counter-eddies into the system just at the point that the systemis swinging itself to get on with implementing what,presumably, is going to become law following theWhite Paper.

Q284 Dr Wollaston: I would like to direct a questionboth to Anthony and to Peter because Torbay andCumbria are held up as beacons of good practice andit would be interesting for the Committee to hear alittle bit more about how you achieved what you haveachieved, and also whether you feel that the changesin the White Paper will be an obstacle or actually actto facilitate what you are trying to achieve. Could wehave achieved it without the White Paper, in otherwords?Dr Peter Weaving: Yes. When we first saw the WhitePaper, the reaction from Cumbria was essentially“Business as usual” because the route we had starteddown, which was towards a locality model havingclinical leadership and, basically, bringing care closerto patients and closer to home, fitted completely withthe White Paper.The reason we started on that journey, as I say, isbecause we came from quite a difficult place. SuePage has already had a mention in a previous sessionas somebody who has provided inspirationalleadership for Cumbria and set us on this path. Butwhat she definitely did was to engage the clinicalleads, bring us forward and engage us with theprocess. It is we who want to take it forward becausewe believe that there will have to be difficult decisionsmade in the future and I would far rather be part ofmaking those decisions than have them made aboutme or about my services or for my patients. I wouldfar rather be involved in that process taking it forward.Anthony Farnsworth: The fundamental drift of theWhite Paper is something that I feel, on behalf of ourpopulation in Torbay, is going in the right direction.We could and we are on the way to achieving many




of the benefits that it is designed to achieve beforeit had been published. I think, though, it probably isnecessary to say that the change in impetus, in termsof the clinical leadership and direction ofcommissioning from general practitioners, will benefitfrom the very distinct push that that has been given.Perhaps I could mention, in parallel with the WhitePaper, the transforming community services initiativewhich is requiring a separation out of commissionerand provider. If it is of interest to the Committee, thereare some interesting questions about the relativelydogmatic insistence on the separation out ofcommissioner and provider during the situation whenone is trying to manage—Chair: It is something I know Dr Wollaston iscertainly interested in and other members of theCommittee as well. Please carry on.Anthony Farnsworth: I would like to describe to theCommittee some of the things that go along with theposition that one is in as a PCT chief executive ofhaving a cash limit for a population. What does thatactually mean? There’s a tendency to see thetransactional mechanisms of commissioning as,“That’s what the job is”. But that’s really only a partof it. What goes along with that is the partnershipswith other agencies. There’s a defined population witha defined cash limit, the requirement to make choices,priorities, to engage with your local public and yourlocal council about that, and most importantly, frommy experience, the business of being responsible formanaging the local system of care. There I am. I havethe cash limit, in my instance, for social care as wellas health, and I am responsible for it. That means Iam accountable for it.One of my concerns about the White Paper is that itis not clear to me quite where that responsibility formanaging the system of care is going to sit in future.The cash limit itself is being fragmented into differentdirections, some going to GPs and some going to theNational Commissioning Board. So how one retains asense of a given population with a given publicresource deployed on its behalf—Health andWellbeing Boards may have a part to play here, I’mnot sure; that needs further clarification.Understanding the commissioning role not just as atransactional role but as a leadership role with publicaccountability for the cash limit to a given populationis an important concept to hold on to, not least frommanaging in the financially constricted period of thenext decade or so, as far as I can be informed. It isbeing able to retain a balanced perspective of thewhole portfolio of health and social care services fora given population.That kind of overview, and the ability to stand up inpublic and account for that to our MPs, to ourcouncillors and to our public, is an importantcomponent of public confidence and credibility andthe reputation of the health service in the minds of ourlocal taxpayers. I am working my mind around tryingto work out how I am going to recreate and achievethat in a situation post the implementation of thesereforms.Nigel Edwards: If I may, that matters because, ofcourse, part of the way that the Nicholson challengewill be met will not be by lots of small decisions but

by some quite brave and big decisions that will needto be taken. This idea of the big assistant managerable to take those becomes quite important. It is notclear whether that does fit with the consortia orelsewhere but, without that, we face some quitesignificant and unresolvable difficulties.

Q285 Dr Wollaston: There is also the issue of beingable to make those make or buy decisions which arevery important.Nigel Edwards: Yes.

Q286 Dr Wollaston: How much do you feel thechanges in the White Paper are the changes that arealready being pushed on PCTs that will impair yourability to make savings and deliver very goodclinical pathways?Anthony Farnsworth: It is relevant. If I step down alevel from my previous statement and go down to thelevel of deploying resources on individual carepackages where you have got GPs, district nurses,social workers and physiotherapists, assessing theneed for treatment, providing treatment, writingprescriptions and making referrals, at that level thesystem works well. If you have got an aligned setof intentions amongst those professionals, the systemworks well when you maximise the discretion andpotential of those professionals to make that make orbuy decision themselves rather than to impose it uponthem. They will be inclined to be virtuous, in thatrespect, if they are operating within a system that isinclined to make them that way, if you see what Imean. That is one of the nuances of the commissioner-provider separation that is not widely understood. Lotsof provider staff make, if you follow me for a minute,micro, individual case commissioning decisions andthat is tremendously positive for patients. It leads youtowards choice and personalisation of both health andsocial care which I think is a part of the policy agendathat is so welcome in the White Paper.Dr Peter Weaving: On the make or buy side, and thisis speaking more as a GP than as a commissioner, asmy colleagues said, GPs are responsible for probably80% of the healthcare spend in the NHS, prescribingthe drugs, referring people to outpatients andadmitting the emergencies. There is only a relativelysmall proportion they are not directly responsible for.The responsibility, which comes with the White Paper,for them accepting the size of that responsibility, isreally quite important. In terms of improvinghealthcare and delivering the savings, it is importantthat there is a certain amount of “making” going onin primary care so that we can free up some capacityin secondary care so they can do more of theimportant secondary care stuff and leave the simplerstuff to us. That is a very important cost-effectivemechanism that we need to make better use of.

Q287 Dr Wollaston: The issue I have is that a lot ofGPs I talk to tell me they are very keen to roll up theirsleeves and get on with designing patient pathways.What they don’t want to roll up their sleeves and dois be responsible for competition law. I just wonderedif you would like to comment on that.




Dr Peter Weaving: What has been a consequence ofour journey is that we have come more away fromcompetition than towards it. We don’t find it aparticularly useful driver of the quality of service.What we find drives the quality of service iscollaboration and sitting down with our secondarycare colleagues. The Committee may not be awarethat some GPs think it is very important to sit downwith consultant colleagues. In Cumbria we do that ona weekly or fortnightly basis to look at some of theimportant issues which are facing us because we don’tbelieve that you can commission your way out oftrouble. If you want to improve services you need tosit down with the people who are providing it andplan it jointly. That will give you far better resultsthan writing a detailed specification and saying, “Giveme that.”

Q288 Dr Wollaston: Would you like to seesecondary care doctors on commissioning consortia aswell, more multi-professional?Anthony Farnsworth: Yes.Dr Peter Weaving: We are meeting with them onThursday, exactly that model.Dr Wollaston: That’s what you are doing.Anthony Farnsworth: At a very early stage in theformation of our consortium in Torbay is the invitationfrom the consortium to the acute hospital trust medicaldirector to join the consortium for the precise reasonthat the clinical engagement between primary andsecondary care is essential, as my colleague wassaying, to achieve the change. There is a place forcompetition and you can locate it on the procurementand commissioning wheel, and it has that place, butgenerally one gets far better results, far betteralignment of motivation and intention, by engagingclinical intelligence across the care pathway.

Q289 Chris Skidmore: It follows on fairly naturallyto management costs and administrative supportservices. Dr Weaving, you mentioned the need forstrong support services. In your evidence you talkabout the consortia in Cumbria and that they cannotand should not take on the PCT administrativefunctions.Dr Peter Weaving: Yes.

Q290 Chris Skidmore: First, I was interested inwhat you have already ongoing in Cumbria in termsof what operations you have and who takes over theadministrative functions within the consortia and,secondly, are you concerned at all about the 46%reduction in management function costs over the nextfour years? Would that possibly impact on thecommissioning practice itself?Dr Peter Weaving: Yes. Obviously, we have comefrom the situation of being an ordinary PCT with allthose ordinary functions and my role and that of myclinical colleagues is to provide clinical steer andclinical leadership. It is not for us to become expertsin contracts, IT and performance. There are extremelygood people in the organisations who already do thatwork. I need them to support the clinical steer that Iwish to put on things. In terms of the managementcosts falling 46% over the next year or so, it will be

a very interesting discussion to say, “What are thefunctions that are currently done by PCTs that wewish to do away with to enable developing consortiato do the job that they will do best but not to take ona lot of—I think Paul Corrigan described them as—the “worrying roles” of PCTs. PCTs are very good atworrying about certain things but not very good atproducing good change in clinical pathways and soon.

Q291 Chris Skidmore: You say the consortia inCumbria are currently designing the level of businesssupport needed.Dr Peter Weaving: Yes.

Q292 Chris Skidmore: What is that looking like inthe Cumbria area?Dr Peter Weaving: Essentially it looks a bit like adistilled PCT. As I said, the set-up we have inCumbria is, following the political boundaries withinthe county, there are the six localities. We are certainlynot going to replicate support functions for each ofthose. There will be a central support function whichwill provide financial expertise, IT, performancemanagement and all those things. That will supply allthe localities.I should probably explain that although the localitiesare semi-autonomous and we try to operate theprinciple of subsidiarity to try and get healthcaredecision-making as close to the patient as possible,we also recognise that across a geographical area likeCumbria you still need something—we call it “thesenate”—where we meet. The senate looks afterthings like the equivalent of the Post Office, roads andrail because those functions are required across all thelocalities but you don’t want to replicate themanagement of each of those functions within thelocality. So there is, if you like, a nesting dolls model.If you are acting as a very big organisation, you needto demonstrate localisation and if you are very small,you need to show joined-upness. For example, if Iwish to change the way cardiac services are providedin Cumbria and have an interventional service whichwe don’t have at the moment, I need to join with theother localities to exert that commissioning clout. Butif I wish to influence an individual practice’sprescribing, then that needs to be done on a verypersonal, local basis. Those are the important thingsfor me but, underneath all that, we still need goodsupport functions. It is a very popular statement tosay, “We’re going to remove management andadministration to save money and we’ll protectfrontline services”, but I think we all agree frontlineservices without support and management will not bevery good frontline services. I think we do need tosupport that.

Q293 Chris Skidmore: Moving from the PCT modelto the consortia model, how much upheaval was therein terms of redundancy costs within Cumbria itself?Dr Peter Weaving: We are still going through that atthe moment. But it’s more the unsettlingness of “Iwork for an organisation which is going to be defunctin three years’ time.” Understandably, it’s anextremely upsetting place to be.




Q294 Andrew George: May I check the populationareas, the populations within the locality area of theconsortium as a whole?Dr Peter Weaving: It’s about 100,000 population. Thepopulation of Cumbria is 500,000 and it is dividedinto six localities. Eden Valley is a smaller one ofabout 60,000 to 70,000 but the rest are around the100,000 mark. Even so, for something like cardiacservices you need three or four of those joinedtogether to get the commissioning clout.

Q295 Valerie Vaz: Is that a settled population?Dr Peter Weaving: Yes. Cumbria is very settled.

Q296 Valerie Vaz: You have got registered andunregistered patients?Dr Peter Weaving: They are largely registered. Wedon’t have much in the way of migrating populations.It’s a fascinating mix because we have got wardswhere the life expectancy is something like 93 fairlyadjacent to wards where the life expectancy is barely70. We have got the deprived west coast of Cumbria—Workington, Maryport and, down in the south,Barrow—and then you have got very affluent areas inthe middle like Greystoke and South Lakes aroundKendal.

Q297 Valerie Vaz: Do you think your model willwork in areas which are not particularly settled?Dr Peter Weaving: Yes. In fact, we have some of thestrongest consortia in evolution. One of the nationalpilots is taking place in Allerdale which is basicallydeprived West Cumbria, and there they have taken thesubsidiarity model down even further, down to verysmall communities such as Maryport, Cockermouth,Keswick and places like this—Keswick being one ofthe less deprived ones, I would say.

Q298 Valerie Vaz: Do you think your model workspartly because you have this coterminosity with thelocal authorities and you have support from the PCTs?Dr Peter Weaving: It makes it very simple for a lotof things. It is a very sensible arrangement and it fitswith the rough size of population you need to bestable. But even within that, to get individual GPschanging their clinical behaviour you need to shrinkit down. You need to drill down even further so thata GP sitting with his surgery still feels that he is partof this system and that the decisions he makes are partof the bigger picture. That is particularly importantwhen we have looked at things like chronic diseasemanagement and trying to avoid emergencyadmissions. Unless you have got people who arejoined up with that—I will digress slightly. When welost out of hours care, GPs became increasingly officedocs and a lot of the emergency admissions are drivenout of hours. What we need to get to is the in hoursdoc, having plans for patients set up so that, out ofhours, an individual patient has a clear mechanism ofbeing looked after so that they’re not reliant onsomebody who has just arrived in an ambulance or anout of hours service, but there is a clear plan for thatpatient, for example in residential care homes. InCumbria, between 50% and 30% of them get admittedto hospital each year as emergencies. That is a

population for which we know it is really bad to admitthem to hospital. They actually do worse beingadmitted to hospital than they do if they are lookedafter in their place of safety. One of the things we aresetting up is for each of those individuals to have acare plan so that it doesn’t matter if it is a GP visitingduring the day or an emergency ambulance turning upat night or an A&E department greeting that patient,they all have access to the same care plan and knownot only what the medical background for that patientis but what that patient wants, what their family wants,what their carer wants and what the GP wants.

Q299 Chair: Can I interrupt the dialogue because Ithink Mr Farnsworth wants to comment?Anthony Farnsworth: I am just going to draw theCommittee’s attention to the question you raise aboutcoterminosity with local government. We have herean emerging situation where the consortia’spopulation will be defined by a group practice andpractice registration and that is not necessarily thesame as a geographical patch. I think there is somefurther thinking to be done, particularly along the linesof the relationship with local government, the Healthand Wellbeing Board and how one is able to account,if you like, for a population for a place—a given partof England. I think the concept of “place” and thestewardship of public sector resources in a given placeand how that is developed and applied in partnershipwith others, including local government, and the linkbetween that and accountability, remains one of thepuzzles here that is in need of further articulation asthings move into legislation. There is a risk of losingthe ability to connect those things together if it issimply left to practice registration.Nigel Edwards: This is an issue because if you takean area like cardiac services, health education will becommissioned by local authorities, primaryintervention by local authorities, the primary careinterventions by the National Commissioning Board,the secondary care by the GPs and tertiary care by theNational Commissioning Board or by group specialservices. So there is an issue with the loss of a placefocus of commissioning potentially becoming quitefragmented and there needing to be the sort ofmachinery Dr Weaving was referring to to stitch thatall back together so there is some geographical andpopulation focus.Rosie Cooper: In short, a mess.

Q300 Grahame Morris: Following on that sametheme that has been touched upon, and I don’t knowwhether my question is best targeted at Mr Edwards,but it is in relation to this issue of registered andunregistered patients and whether that is really goingto reflect local needs. I am thinking particularly notso much about Torbay or even Cumbria in that regard,but if GP consortia have to cater not just for registeredpatients but for unregistered patients what would bethe consequences for areas suffering multipledisadvantage? I’m thinking of Easington. I’m thinkingof the old industrial areas. I’m thinking of TowerHamlets. If patients are choosing to register in thecities where, perhaps, they work should there be someallowance made for other areas who are grappling




with issues of health inequalities, ageing populationsand high levels of ill-health? I know Cumbria hasissues about rural sparsity. I would be interested inyour thoughts on that and on deprivation.Chair: All within 60 seconds.Nigel Edwards: There’s a whole portfolio to yourquestion. A few points. We deal, first of all, withpatients with registration problems, with areas withlower levels of registration or with high levels ofchurn. There is a practical difficulty about actuallymeasuring outcomes. If you are in Newham and 20%of your patients move to other areas—your patientpopulation is entirely being refreshed with people whoare like the last lot who have moved out—being ableto make a long term investment and show outcomeimprovements is a challenge. If you are going to havea focus on being able to deal with the homeless, theunregistered and some of these other groups who maynot use general practice in the way that the bulk ofthe population do, you probably still need to have ageographical focus.

Q301 Grahame Morris: A residual responsibility.Nigel Edwards: So somewhere in this system there issomeone who will bring all of that back together andlook at these because many of the interventions youneed to be making are based on geography.The question of resource allocation you raise is areally difficult one because there is an unresolvedacademic and methodological dispute about exactlywhat the right way to measure the allocationmechanism should be and whether you should countdeprivation in that. To some extent, this is a technicalquestion. We don’t, as yet, know what the newallocation formula will look like but what is clear isthat if you are going to allow people to register withpractices outside their geographical area you probablyshould not be using geography, which is how it isdone at the moment, to determine what the allocationshould be. You should be using the characteristics ofthe patient, which will require—and this is possible todo—a new methodology. It will probably have theresult of significantly changing things, particularly if,as is also proposed, as I understand it, you reducethe funding for deprivation in the funding for healthservices and put that into the funding for publichealth. All that will have this very significantredistributive effect so consortia which may well findthat they are thinking they are going to be gainingfrom the operation of account allocation formula mayvery easily find that they are losing. There will bea very interesting debate to be had about how thoseformulae are calculated. Of course, the key questionis: what pace of change should you have to movepeople to their new target? How public health fundingwill be allocated and how that will affect differentlevels of deprivation and life expectancy and the rest,we are due to find out, I understand, in the next fewdays. I can’t help you on that.Dr Peter Weaving: Although we don’t know what thenew formula will be, what we have done in Cumbria,because the six localities have quite different levels ofdeprivation, is we have taken the NHS formula andapplied it to each locality individually and it hasproduced quite significant shifts in healthcare funding

which has definitely benefited the more deprived areaswhich have received quite definite increases infunding. We have taken a rate of change of travel andI think we are heading to bridge 50% of the gap inthree years. But there are some quite large changes infunding for health economies and that is to thedetriment of the better-off economies at the moment.Anthony Farnsworth: I echo the point that, in movingpractice level allocations on a pace of change towardsfair shares, we have been trying for some years tosteadily—“first and most deserving” is the expressionfor this—benefit more deprived practices and, withina fixed sum, that is a redistribution. There are winnersand losers in that redistribution but I am happy tostand by the redistribution. I think it is justified.

Q302 Grahame Morris: Do you all subscribe tothat, all three?Anthony Farnsworth: Yes.Dr Peter Weaving: Yes, definitely.Nigel Edwards: Of course, the more you fragment—the lesson from Dr Weaving’s example—the moreconsortia you have, the more variation you have. Thisis just a statistical fact. There will be some difficultconversations when these new allocations arecalculated and when the new formula is introducedwhich will be, particularly in better-off areas with arelatively young population, for some people, a quiteunpleasant surprise.

Q303 Chair: This is no longer, of course, aboutdifferential growth. This is about actual reductions insome areas if you are to achieve any significantresource transfer?Nigel Edwards: Yes.

Q304 Mr Sharma: In answering Grahame’squestion, you have already partly answered mine, butadditional to that is the fact that in a constituency likemine, Ealing, Southall, where there is quite a largeunsettled population, changes in the welfare benefitmight encourage some, if not many people to moveout and a settled community becomes unsettled fordifferent rules in benefits, housing benefit and otherareas. A shortage of social housing forces people tomove out and then areas like Cumbria might havepeople from my constituency or the south-east movingfurther into there. Won’t that cause a lot of problemsif there is a shortage of resources, particularly whenthere are cuts in administration costs that put morepressure on the consortia as well as the local GPs?Anthony Farnsworth: I understand the question andI think you are quite right to be aware of theforthcoming changes in the benefits system which Ithink will impact significantly, particularly on adultsocial care funding. I remind the Committee of themechanism that was used the last time the GP contractwas renegotiated of reimbursement for temporaryresidents. The health service has previouslyconsidered a mechanism for managing turbulence inprimary care registered populations in the GMScontract. Your civil servants would be able to adviseyou how that worked and I wonder if it might havesome applicability, as a mechanism, to relatively




unstable or moving populations in the light of yourquestion.

Q305 Rosie Cooper: I want to ask about historicdebt, but before that, so as not to lose the thread, DrWeaving talked about the model he has got now, inessence, being a “distilled PCT”. I wondered whether,as the Secretary of State was so fond of Cumbria, hemight have paid more attention and, therefore, appliedthat model to the rest of the country to give us a goodresult without the cost, the angst and the grief of boththe Nicholson challenge and the huge structuralchallenge currently being imposed on the service.Perhaps Mr Farnsworth, or all of you, could tell mehow, in the models you have now got, where thepatient voice is, how the patient influences and has asay in what is being done for them in their name?Dr Peter Weaving: There are a number ofmechanisms. Some are informal and some formal. Asa practising clinician—as are all the GP localityleads—the informal mechanism is that we spend quitea lot of our working week sitting down with patientsnot only hearing what their side of the story is but alsohearing what their experience of other local services,particularly the hospital service, is. That is extremelyuseful intelligence. It is soft and it tends to getforgotten. Also, within each locality we have patientrepresentation and that can either be patientrepresentatives sitting with a locality board or we alsohave—and I’m just trying to think of the technicalterm for it—fora where we have groups of patients wecan ask questions of. That is simply, if you like, aregistered list of people who are keen to—Rosie Cooper: A forum?Dr Peter Weaving: Yes.

Q306 Rosie Cooper: But do they ever get an actualsay? Are they ever involved actually at the point ofdecision making?Dr Peter Weaving: The patient representative will sitat a locality board meeting like this and would give aview, would take part in the debate and would have avoting right, the same as any other member of thelocality board.Anthony Farnsworth: There are a couple of otheravenues. First of all, we do—I am sure all PCTs do—consult publicly on priorities. The decisions aboutresource spending, new commitments and changingservices are discussed, and some of them, if they aresubstantial changes, are subject to formal publicconsultation. We are also subject to the health scrutinyprocess that local government carries out.Rosie Cooper: A complete waste of time, but carryon. I do understand your role, but a complete wasteof time.Anthony Farnsworth: I suppose I’m trying to answerthe question, what are the mechanisms in the presentsystem that are designed to do that?Rosie Cooper: Yes.Anthony Farnsworth: It may be that it doesn’t fullyfulfil all those hopes but, none the less, it is there.Then there is the advent of what were formerly thePPI fora that have now become the links that—I seeyour expression again.

Chair: We try to keep most of our opinions until wewrite a report but can’t always succeed.Anthony Farnsworth: I think Dr Weaving’s firstanswer was probably the most profound, which is atthe level of the individual consultation, the exerciseof choice, the provision of information to individualpatients about their treatment, about the choices theyface, the options they have, conservative treatment,intervention and so on. That is the most meaningfullevel.Nigel Edwards: We should just say that while GPs dosee 70% of their practice population in the year, whichis an extraordinary coverage, it is sometimes not easyto spot patterns where there are weak signals. In theopening address of the counsel to the inquiry, it isvery noticeable that the GPs in mid-Staffordshireappeared not to notice what was happening in theirpatch. I think this is defensible because hospital useis a relatively rare event and the number of peoplewithin that is a relatively rare number of patients whowere having problems. The address said of seeingpatterns that “The sum of lots of individual GPconsultations is not a population health view.” I don’tknow if Dr Weaving agrees with me but there is alsoa need to have, on top of that, a mechanism forsystematically looking for some of these weakersignals that may be hard to detect on an individualconsultation basis. So while individual consultationgives you a huge amount of very rich intelligence,there isn’t a sign in the GP surgery that says, “If youwant to talk about health strategy and priorities, pleasebook a double appointment.” There is not thatopportunity to have that conversation. I think there isa need for other mechanisms, and not just at the GPlevel of commissioning.If I may, one point that is really worth making here isthat there appears to be no patient or consumer voicein the role of the economic regulator, which is a veryimportant part of what will become thecommissioning machinery and will be makingdecisions which will affect, in some detail, theprovision of care and will be deciding on some ofthe integrated models that we have heard about thismorning. It will have a say on whether or not thosemeet their criteria in terms of meeting patient benefits.We should not just be looking for patient involvementat the practice, consortia, Health and Wellbeing Boardlevel but at other levels in the system as well.

Q307 Chair: Can I bring Dr Zollinger-Read into theconversation, having won through the weather? Youare very welcome.Dr Paul Zollinger-Read: Essex doesn’t do snow.

Q308 Chair: It may be useful to the Committee if Irepeated to you the question that the other threewitnesses answered at the beginning: in yourexperience, you are doing many of the things that arein the White Paper policy. Does the introduction ofthe White Paper facilitate what you are doing and howdo we avoid making the development of your ideasmore difficult?Dr Paul Zollinger-Read: I suppose we are, inCambridge, in the unique position that over a yearago, long before the White Paper, we reckoned the




PCT wasn’t working. So we went out and had longand detailed conversations with all the GPs anddecided that what we needed to do was form clustersrather than PCTs. So long before the White Paper westarted setting up clusters. They range from 100,000to 50,000 and we have now got five of them. They areautonomous in that they now have their own budgets.What that did was two things to us. First, it putclinicians in the driving seat where they weren’tbefore and secondly, we recognised we were not goodat getting the patient voice into a PCT of 600,000. Wedid all the things you have heard but we weren’t goodat it. We went down that road and we did one otherthing as well. We set up a whole series of peer reviewswhereby GPs reviewed the referrals and describedthem as their “colleagues”. We decided we weren’tgoing to send referrals to a black box they don’t getout of, we were going to leave it to clinicians.The results are interesting because in our Hunts areaour activity and our stats have gone down. WithAddenbrookes the growth has reduced. I have no ideaof this cause and effect but what we know is thatwe’ve changed the system and we’ve got beneficialresults so far. We have certainly got much, muchgreater clinical engagement.Another thing we did that I’m not certain the WhitePaper speaks as much as I would like on is theprimary and secondary care divide. That is a real issuethat we haven’t tackled. We said, “What are the ninekey clinical areas across this county?” They rangedfrom oncology to cardiology to diabetes. We said,“Let’s set up Joint Working Groups with a consultantlead and GP lead and patient input.” Then I got itwrong because I said, “Right, we’re going to task youwith being cost effective.” What I should have said is,“We’re going to task you with improving quality.”Once I actually got that right those workstreams thenreally motored looking at, “Where are we?” “Wheredo we want to go?” “How do we maintain or improvethe quality and improve cost effectiveness?”We are also having very difficult discussions about theuse of chemotherapy in the last stages of life where,because this is clinician-led, they can quote the papersand the New England Journal of Medicine whichshow good quality palliative care—surprise,surprise—will actually extend your life.Chemotherapy will not extend your life. Good qualitypalliative care will. So we have moved, in a shortseries of jumps, to a clinician-led organisation and ithas improved our outcomes.

Q309 Chair: Clinician-led, meaning GPs as thecatalyst for the wider clinical community?Dr Paul Zollinger-Read: Yes. We started off bysaying, “Right. We’re the Executive. We want GPleaders. Five of you come in. You are part of ourExecutive. You have the power of veto.” What we arenow doing is we are setting up something which isdreadfully called “the senate”. I know it is dreadfullynamed, but it will be GP leaders and they will nowform the strategic group across Cambridgeshire andPeterborough so that we will start to have a strategicfocus that they can link in and ask, “What are wedoing in major trauma centres? What is our view ononcology?”

Q310 Rosie Cooper: If I may just continue the trainof thought I was going down, I want to try and elicit,where patients engage or influence currently, whether,in the new consortia, you think that patients couldaccess or influence directly and how you feel that GPsin the consortia would take, for example, to openboard meetings and their decisions being made inpublic, and, at each level of the new world, where doyou think the accountable officers should be? Who isgoing to take the rap for each of these decisions? Inthe consortia will the chair be the accountable officerfor the decisions that are being made in their name?Where do you think the buck stops?Dr Peter Weaving: I think it should stop here. I wouldbe very happy for it to stop here and I would verymuch welcome any mechanism which empowers thepublic. It is quite difficult to empower the public inhealthcare decision making. There has been previousreference to the fact that clinicians, even if they don’twant to, tend to be overbearing and put off publicinfluence. That is very unfortunate, but I think it doeshappen. So it is very difficult to get real publicengagement and I genuinely don’t know how you doit. It’s very easy to get representation. How you getempowered opinion turning into policy is much moredifficult.Anthony Farnsworth: There is a relationship betweenyour question and my earlier observations about theresponsibilities and accountabilities that go withhaving a cash limit for a population because, rightnow, if something goes wrong in Torbay I am theaccountable officer and I know that I’m the personwho is responsible for it. Your question is a good one.If a GP consortium has a cash limit for a givenpopulation, I would have thought that it would haveto carry with it an accountable officer status just interms of Treasury accounting terms. That is a role thatcould be held by a GP and that becomes a position ofpublic accountability and responsibility. In that sense,I think that is the nearest proxy I can see at themoment to providing a good answer to your question.The thinking about the development of Health andWellbeing Boards, whether they are executive or non-executive, whether they are within the executive partof the council or part of the partnership architectureand how they are finally constructed, there is apotential partial answer in the design of that Healthand Wellbeing Board arrangement. But I don’t thinkthat can fully supplant, nor is it designed to, theaccountable officer role that would need to sit withinthe health service for health service responsibilities.Dr Paul Zollinger-Read: I am a GP and I have beena chief exec and a GP at the same time. I think youshould stand up and be the accountable officer. Theseare clinically led organisations and they need to haveaccountable officers who are clinicians.

Q311 Chair: Can I just be clear: You are currentlythe chief exec of the Cambridgeshire PCT and apractising GP?Dr Paul Zollinger-Read: I put it on hold and I goback in March. I think that was the wrong decision.My current employer said, “This is a really big job.You need to put that on hold.” I have been a GP and




a chief exec of five or six PCTs since early 2000 andI think it adds value.

Q312 Valerie Vaz: So someone judicially reviewsyour decision and you are the named person that theyjudicially review?Dr Paul Zollinger-Read: Yes.

Q313 Valerie Vaz: Ultimately that is going tohappen, isn’t it?Dr Paul Zollinger-Read: Yes.Valerie Vaz: They are not going to be happy withyour decision so they judicially review you, asopposed to the Secretary of State?Dr Paul Zollinger-Read: That’s an interestingconundrum. It has never happened to me.Valerie Vaz: Because they usually do it to theSecretary of State.Chair: You might live to regret it.Nigel Edwards: I think it is entirely unclear exactlyhow this will work in the new system. It is also notclear what governance structures the consortia willhave. I think the intention at the moment is to leavethat fairly fluid. I’m not expecting to see the type ofboard and machinery that we have seen in PCTs. Ithink it will look quite different.One of the interesting questions is, just by analogywith—and this may seem odd—hospital managementin Hungary and Poland and a number of other EasternEuropean countries which I’m familiar with, beinghospital director is a job done by a doctor. It isgenerally reckoned to be not a job worth having andwhen you are sacked, which is a very regularoccurrence, you go back to your previous clinical job,which is the one you wanted to do anyway, and youearn twice as much money as you did previously.There is an important point which is, if this is a jobworth having it should be a job worth losing. We haveserious people here who will take this seriously but Ithink there is also a message to the rest of the systemabout, “This is the place where all the accountabilityis.” I don’t quite see how that works in this newsystem. The point that was made earlier about judicialreview and the need for a very clear, transparentdecision-making process which currently exists inPCTs is also very important and it would be importantto make sure it isn’t lost. I am torn on this becausehistory suggests that asking the Department of Healthto design governance structures is probably not a goodidea. On the other hand, some design rules andprinciples just to help people not fall into the veryobvious traps that end up leading to judicial reviewwould be helpful. I don’t know if my colleagues agreewith that.Anthony Farnsworth: And locate the accountability.

Q314 Dr Wollaston: Can I follow through on Paul’sprevious answer, and that is to say with these threevery successful pathfinders here today in front of theCommittee, would you have thought it was possibleto get what you have achieved without the WhitePaper and just roll that out across the rest of thecountry or did you think the White Paper wasnecessary to implement it nationwide?

Dr Paul Zollinger-Read: I also run PeterboroughNHS and you find that Cambridgeshire NHS got therea lot quicker. Peterborough, with the White Paper, isnow incredibly motivated and the GPs are movingforward really quickly. I don’t think we would havegot that without the White Paper.

Q315 Dr Wollaston: So you think the White Paperis going to be a good impetus to roll out—Dr Paul Zollinger-Read: I do, simply becausesomeone like me fundamentally believes thatcommissioning needs to be clinically led and you needto tie the financial accountability to the clinicaldecisions. The final bit, which we probably haven’theard much about, is this. We have heard about patientengagement but patient involvement in their owndecisions about their care is a crucial bit that we mustget right in this White Paper because we haven’t doneit well before.

Q316 Chair: I guess one of the traditional challengesto clinically led commissioning of the kind you havedescribed is the question, does it face the toughrestructuring decisions required, service re-provisionand reorganisation? Do you have experience of that?Does it facilitate those?Dr Paul Zollinger-Read: All I can say is that yearsago it was fund holding and that was a different worldbut we made decisions to restructure mental healthservices locally because they were poor. Within a veryshort space of time we had a really positive localmental health service that everyone else benefitedfrom as well and that happened because it wasclinically led.Anthony Farnsworth: A supplementary examplewould be with respect to cancer services, the roadcancer networks and the implementing of improvingoutcomes guidance, which are clinical evidence-basedstandards for cancer care. That would give youanother proxy of the sort of clinically driven evidence-based mechanisms that GPs as commissioners wouldneed to support them in tackling, for example, a majorservice reconfiguration or a relocation of service thatmight be indicated in terms of its viability or itsstandards.Nigel Edwards: If GP consortia were given the job ofdoing that strategic change then they will do it. But,taking the lessons of what has happened previously,they will probably need to club together on occasionsto do it effectively. The big lesson is whether they willbe given the licence and the support to make thosedifficult decisions because while, in principle, we arevery keen on people making these decisions, when thereality of the decisions are made some of the previoussupporters cannot be seen for dust.

Q317 Andrew George: Can I clarify? When you sayclinically led decisions, of course what you mean isGP-led or primary care-led decisions. Can I just beclear that, in the case of Cambridgeshire and Cumbriaand elsewhere, when you say “clinically leddecisions” how do you make sure that those clinicallyled decisions represent, if you like, the clinical viewacross the piece including secondary and tertiary? Iknow that this has been mentioned already.




Chair: There is a good bit of competition between thewitnesses to answer that one.Anthony Farnsworth: To use the example I startedwith, the development of clinical standards for cancercare is done not just by GPs, it is done by consultantsand the National Cancer Action Team and so on. Thatmay be a good example—

Q318 Andrew George: No, it is not a good example,is it, because that is taken at a more strategic level,isn’t it? It is not taken at the GP consortia levelbecause the cancer networks cover much larger areas,don’t they?Anthony Farnsworth: Yes, but, in effect, theirmandate or power to operate is a delegated ordevolved arrangement from a number of, at themoment, PCTs and, in future, consortia. They hopethe health service realises that it needs to collect acritical mass of expertise in order to make difficultstrategic decisions and I am sure that has been thecase and will continue to be the case in future. Itremains to be seen as to how much of that voluntarilyemerges between consortia and how much of that islocated in the infrastructure of the NationalCommissioning Board or its substructure. Thatremains to be seen.Dr Paul Zollinger-Read: Two examples on theclinically led decisions, dermatology and diabetes:both GPs and consultants in Cambridgeshire decidedthat they would move it to a community-based model.So those were clinically led decisions. When I goround, the commonest things I hear are “them” and“us”, hospitals versus primary care. What thosegroups decided was, “Right. There are consequencesof this. You, as a hospital, have fixed costs. So howare we going to make sure we can make this transitionwork, not just for us in the community but for you inthe hospital?” So they have developed a maturity ofdialogue that facilitates those transfers.

Q319 Andrew George: Is it not true, though, thatmaybe whilst, on the one hand, the clinically leddecisions with regard to a sub-specialty have to betaken within the context of having a population levelthat takes you to more strategic decision-making,whereas with the kind of decision that you are talkingabout in Cambridgeshire, are you not describing asituation where the GPs hold the purse-strings and thehospital clinicians are there taking part in thatdecision-making from the perspective of the providersof services? It is not, if you like, an equal relationship.We are getting your perspective on it and you aretelling us that it is clinically led.Dr Paul Zollinger-Read: It is an equal relationshipbecause you can’t move a service into the communityunless you can get agreement across a clinicalpathway. So you have to agree and clinicians onprimary, secondary and community have to agreewhat that pathway looks like and then agree to moveit. If it is not agreeing with all those clinicians andwith the local patients then it will fall over quickly.

Q320 Andrew George: And where does the patientcome in?

Dr Paul Zollinger-Read: The patient comes inhelping to design what that pathway looks like. So,for instance, in Fenland we have piloted movingdiabetes out to our most deprived area and we hadsignificant improvements in HBO1c. That is ameasure of good diabetic control and that was verymuch supported by patients.

Q321 Andrew George: But they don’t sit on theBoard. They are not part of the planning process?Dr Paul Zollinger-Read: They sit on the Board or thegroups of our localities or the trusts, as we call them.

Q322 Andrew George: They do?Dr Paul Zollinger-Read: Yes.Dr Peter Weaving: I think the very important pointyou are making is, do primary and secondary careclinicians agree and everything is fine in the garden?If they sit down and talk constructively and look atgood clinical evidence it is usually fairlystraightforward and you can get agreement. Butsometimes people have particular ways of workingand there are disagreements and there are issues whichneed to be resolved. That is probably one of the veryfew times when genuinely commissioning does makea difference and you say, “Actually, we do want it thisway. We do want it provided this way.” But you haveto be absolutely sure you have got it right if you aregoing to go down that route rather than the far betterone as described by Paul of actually reaching a jointpathway.

Q323 Dr Wollaston: How will that be impacted ifyou have to consider competition law from outsideproviders?Dr Peter Weaving: In Cumbria we are very fortunatein the sense that although it brings the whole choicething up, in a way, if you really ask patients what theywant they don’t particularly want a choice of lots ofproviders. What they really want is to be able to takepart in healthcare decisions and they want choiceabout those decisions rather than having lots ofproviders.

Q324 Dr Wollaston: But do you think there will bea problem for you in designing these pathways if youhave to consider competition law and who isproviding the best value for money rather than thebest quality of service?Dr Peter Weaving: It will be a great distraction formany health economies where it is very difficult tohave a competitive market because, basically, youhave a town or a small city which essentially supportsone district general hospital. Can you realisticallyproduce competition which is going to improve thecare for anybody?

Q325 Grahame Morris: My question is related tothat last issue about the design of care pathways andthe commitment to empowering patients whicheveryone subscribes to. On the evidence from theNHS Confederation in relation to market mechanisms,where it says: “There is a risk of an over-reliance onmarket mechanisms to manage complex healthservices”, do you have a view on where the limits




should be placed upon the operation of a marketmechanism in relation to re-designing services?Nigel Edwards: That is another complex question.What we had in mind there particularly was there area number of services which are made up of otherservices and the individual components of thoseservices have their own markets which are morepowerful, individually, than the market for the thingthat they had come together to produce. The bestexample of that is probably trauma. Trauma is a veryrare event but it is created by vascular surgery,thoracic surgery and neuro surgery. There’s a list ofother things that it consists of, each of which havetheir own market, which dominate the market fortrauma. So you cannot rely on markets, in thesecircumstances, to solve these complex problems of,“How do I get all of those six or seven specialties inone place working together?” That is certainly oneissue.There is, then, I think a question, and there is a bit ofa danger here of regarding markets and competitionas an end in themselves rather than as a set of toolsand techniques where you have got to produce anoutcome, and also to assume that the competition isentirely for each little component that patientsexperience as opposed to the whole diabetic pathway.So the solution to Dr Wollaston’s problem is to havecompeting providers of the pathway who are going tocompete for the whole management of the care ofthose patients. That would not be the way that youwould deal with hernia repair. What you are reallylooking for here is a non-dogmatic nuanced approachwhich uses competition and markets in addition to theother tools that are available to you and you makesure that you fit those tools to the job in hand ratherthan just applying it within limit. The competitionregulators do seem to have that rather more pragmaticapproach to have things done.

Q326 Grahame Morris: Perhaps you could answerthis as well, because it is related to that, and this isthe issue that we have heard from a number oforganisations and witnesses who have given theirevidence about the issues around any willing provideras opposed to a preferred provider and whether thatmight undermine some of the core values of the NHSin terms of fairness and equity.Nigel Edwards: I’m not sure that a preferred providermodel does anything for those objectives at all. Itseems to me that there are hosts of questions aboutany willing provider models but there are a series ofservices the NHS provides and for which an anywilling provider model seems to be an entirelyappropriate way of working, with the slight caveatthat—and you need to be aware of this—they can beinflationary because you are bringing in the supply.One of the invariable rules of healthcare is, “If youbuild it, they will come.” There is supply and induceddemand but if you want innovation and if you wantnew entrants then any willing provider models arefairly effective ways of providing that. Markets areblind to questions of distributional justice and equity.So, “Who provides this?” and how it is provided willnot make an impact on this. How you design a systemabout how patients access it with the sorts of

conversations they have with the people that referthem and how they get to know about it is what isgoing to have an impact on demand.

Q327 Grahame Morris: So other than word ofmouth, the only way to address that withoutcompounding health inequalities is to address itthrough the allocation formula in terms of addressinghealth inequalities and special needs?Nigel Edwards: I am for the decision made byclinicians because we do know, and we’re not reallysure why, that deprived communities get less access toa whole number of treatments from which they wouldbenefit. I suspect a lot of this is about the nature ofthe interaction that happens in the consulting room.Just as an aside, it does seem to me all of the thingswe have heard here do suggest, and particularlylistening to our colleagues here, that the ability of theconsortia to direct the influence and the behaviour oftheir colleagues in general practice and primary care isgoing to be as important as their ability to commissionsecondary care. I think a trick may have been missedin the design—going slightly off piste, if I may—inthe White Paper of not giving the people who arerunning GP consortia more formal power in terms ofeither the management of the GP contract or at leastits performance management.Anthony Farnsworth: I am just going to touch onthis question of any willing provider again which yourquestion raised. The experience I have is in trying torun a system in Torbay of care co-ordination. Thereare about 5,000 people in Torbay who are nearly allelderly, have co-morbidities and feature on one ormore than one of the GPs’ chronic disease registers.They consume more than half the adult social careresource and at least half the hospital resource. I findmyself trying to run a system of care co-ordinationand that requires a system of care provided in generalpractice, in community settings and in the hospital towork together as a system.Whilst it is possible to envisage specifying for thatsystem and putting it out to tender to an any willingprovider market, I have to say that that would not bemy preferred step. If the system broke down and wasnot working I might be driven to that, but my maindiscipline, effort and attention is to get us managingthat system and making it work for the benefit of those5,000 or 6,000 complicated elderly patients who arethe bulk of the non-elective and complex work thatgoes on in our health community.

Q328 Valerie Vaz: Obviously, this is quite key. Youare all expected to be up and running by 2013. How—each of you—are you going to manage this transition?Dr Paul Zollinger-Read: For me, I have reached apoint that I say we have to flip the PCT because Ican’t keep running clusters and a PCT. So I’m havingactive discussions with both Cambridge andPeterborough about, “Right, we’ll flip the PCT andnow become a support service to your consortia. We’llalign ourselves with your objectives and then we’llwork out, is this the type of support structure youneed? It won’t look like that in future—we will needto bring in different skills—but we need to do thatbecause we can’t continue to run the two.”




Anthony Farnsworth: Same answer, supported byclustering PCTs.Dr Peter Weaving: The same answer—Chair: We end where we began on that subject.Dr Peter Weaving:—the evolutionary process. But Ithink we underestimate the management support thatthe consortia will need.Nigel Edwards: And evolution produces someunwanted and difficult consequences from time totime.

Q329 Valerie Vaz: What about the financial costsfrom flipping the PCT?Dr Paul Zollinger-Read: We have clearly got ourmanagement reduction targets that we are achieving.We have clearly got our QIPP targets that we arecurrently achieving. Peterborough, when I took itover, had a debt of £5 million but will hopefully endthe year with much less than that. So bothorganisations, due to GP involvement, are heading inthe right direction.Nigel Edwards: The question of debts, that is left tothe end of this transition. Given that the NHS has asealed sum of money, there is only one place it cancome from. If it is not passed on to the consortia there


Witnesses: John Seddon, Vanguard Consulting (visiting Professor at Cardiff University Business School;fellow at ResPublica, Kingsley Manning, Executive Chairman—Health, Tribal, and Alan Downey, Partnerand Head of Public Sector, KPMG, gave evidence.

Q330 Chair: Thank you for joining us. I think allthree of you heard the previous evidence session.Perhaps I can ask you to briefly introduce yourselvesto the Committee before we start?John Seddon: I am an occupational psychologist. Irun a consulting firm called Vanguard. Vanguard’spurpose is to help organisations change from aconventional command and patrol design into asystems design. I was asked to come here on the basisthat I have been working in health but I haven’t in thesense that I haven’t helped any health organisation toredesign itself. We have inasmuch as this work startsby studying your organisation as a system and someof that work has gone on but, in all cases, it leadspeople who work in the NHS to a position of conflictwith the Department of Health. But I am grateful tobe invited and I would like to explain, if I have theopportunity today, how it is that commissioning isdriving costs up.Chair: Thank you. We shall look forward to comingto that.Kingsley Manning: I am executive chairman ofTribal, a health business. Tribal is a leading supplierof support and advisory services to the healthcaresystem.Alan Downey: I am a partner with KPMG, theaccountancy and advisory firm. I am responsible forour public sector practice within KPMG and, likeTribal, we are a provider of professional services tothe NHS and to other public sector bodies. Aparticular focus of much of our advice is on financial

are some good managerial arguments for not sayingto people, “You will be let off any deficits.” It willeither top-slice from allocations or it will come out ofreserves that could have been spent on healthcare. Ithink there is a little bit of a fiction that seems to be,if you read the GP press, that someone will comealong with some additional money. No one I knowwho is involved in this is expecting that.Rosie Cooper: In fact, I think the medical press arecurrently saying it will come from surpluses held bythe strategic health authorities.Nigel Edwards: That is usually a one-off deficit.Rosie Cooper: Absolutely.Nigel Edwards: It doesn’t deal with the situationwhere people have got rolling deficits.Rosie Cooper: My latest intelligence says that.Dr Paul Zollinger-Read: That is my absolute point. Ihave taken over many organisations in debt andpaying it off would have done us no favours. It is astructural underlying reason that you need tounderstand and usually that requires declinicalengagement to correct.Nigel Edwards: I agree.Chair: On that note, thank you very much for yourattendance and for your contribution this morning.

management, good financial control and introducingcommercial discipline.

Q331 Chair: Can I begin by focusing the minds ofall three of you gentlemen on the twin nature of thechange management challenge faced by the healthservice at this moment, that is to say, first, that it hasto deliver a 4% efficiency gain compound over fouryears and, secondly, that it has to engage in a processof institutional change which is described in summaryin the White Paper? The Committee would beinterested to know, first, whether any of yourorganisations were consulted by the Government aspart of the preparation for these processes and,secondly, what your observations would be about theway in which the process is unfolding. Who wouldlike to go first?John Seddon: The answer to the first question, forme, is no. My general view is that, like a lot of changein the public sector, this administration believes inindustrialisation and scale. I think that is a mistake.

Q332 Chair: Would you like to enlarge on that?John Seddon: Yes. Most of the Ministers concernedwith the public sector believe in bigger is better, thatwe should, for example, share services, share frontoffices and back offices and these kinds of thingswhich have IT-led change. The greatest example ofthis failure at the moment is HMRC. I think thenumbers are that something like 1.7 million peoplehave paid too much, more than 4 million people have



30 November 2010 John Seddon, Kingsley Manning and Alan Downey

paid too little and 17 million people they are not sureabout, which must be most of the people on PAYE.Chair: I am pleased to say HMRC falls outside oursphere of responsibility.John Seddon: Yes, but we’re doing it in health.

Q333 Chair: The Secretary of State, I guess, if hewere here, would say he is precisely seeking to aimaway from that mistake by encouraging responsibilitycloser to the patient in the form of GP consortia. Doyou think that is right?John Seddon: I think it is vital that we have clinicaldecision making in the health service. We have madea great mistake with too much managerialism, I amsure of that. I listened to the conversation earlier aboutpatients and choice. What I have found in every otherpublic service I have been involved in is that peopledon’t want choice, they just want a service that worksand when they haven’t got a service that works theywill spend a lot of time going out on a cold Tuesdayin November or whatever.

Q334 Chair: Shall we go along the witnesses first?Mr Manning, I saw you nodding both ways in thecourse of the comments of Mr Seddon.Kingsley Manning: Certainly we haven’t been paidfor advice by the Government since 5 May. In fact,we have been asked to reduce our prices significantlyalong with other tier 2 suppliers, so much of theadvice we have been giving has been for free.The important point to remember in terms ofregaining the efficiency gain that David Nicholsonspoke about is that some 70% of that will be achievedby tariff reform, in other words, to provide a reform.Most PCTs, most service health authorities, arequickly going to enforce price reductions on theirsuppliers. Therefore, it is not a question for PCTs somuch except to the extent that PCTs andcommissioning groups of other sorts, including GPs,get in the way, if you like, of the efficiency shifts thathave to be achieved and productivity gains that haveto be achieved on the supply side. So 70% of your4% per annum, Chairman, is going to be achievedessentially through a forced price reduction onsuppliers. The balance, certainly, has to be deliveredthrough commissioning and that, essentially, assumesdoing less or ensuring that what you do is done withcheaper suppliers or controlling referral processes.There is a conflict between having significant changeand the reform of PCTs at a time when you areattempting to manage that process. But thefundamental direction of aligning decision-making,clinical decision-making and individual patientdecision-making, at the front end of the system seemsto me to be exactly the right diagnosis. The wholeprocess of transition management may not be the onewe would have potentially designed if we had beenasked but it is the one that has been chosen and I thinkthat, as Nigel Edwards has put it, the arguments forgoing slower and faster are about equal and, havingannounced the change, there is a sense of inevitabilityand momentum which now needs to be carriedthrough.Alan Downey: We were not consulted prior topublication of the White Paper. As far as the challenge

that the Government has set for itself and for the NHS,it is a very big challenge because it is trying to do twovery important things in parallel, a major change ofpolicy, the shift from PCT-led commissioning to GP-led commissioning, and, at the same time, addressinga pretty substantial financial challenge under theQIPP banner.I don’t agree with John that the policies which arenow being proposed are all about industrialisingprocesses. I think in many ways this is a much moredevolved process than the one which was followedunder world class commissioning, the PCT-ledinitiative of the last Government, and my hope wouldbe that we will see a variety of different approachesbeing adopted by different GP consortia and that thatwill not only be accommodated but will be welcomedby the Government. So they are making efforts tostand back a little, to push accountability down and toallow clinicians to do what everyone who has spokenso far, I think, has agreed with, which is to alignclinical judgment with financial accountability. I thinkthat is absolutely the right way forward.There is going to be turbulence in the system over thenext couple of years, not least because there is thisrather unusual position of saying to the PCTs, “Wewant to abolish you but not yet.” I’m not sure, forexample, that many private sector organisations wouldhave approached the task in quite the same way butwe haven’t seen a great exodus from PCTs. They doseem to have held up reasonably well. The clusteringof PCTs will help to reduce the turbulence. The QIPPagenda, after all, has been running for the last 18months so we would expect some fairly well advancedplans to be in place already. It is not a new challengefor the NHS. But, given that the decision has beentaken to give responsibility to GPs for driving changein the system, there is every reason to believe thatwith the right support they can rise to that challenge.They are the best placed people in the system toremove some of the unnecessary variations in referralpractices, in prescribing practices and also betterplaced than I think PCTs were to make that vitaljoining up between primary care and secondary carewhich has been a real problem for the NHS for sucha long time.

Q335 Grahame Morris: I have got a number ofquestions but I wonder if I might just clarify in myown mind that you three gentlemen are allrepresentatives of private sector organisations thatwould presumably profit from the changes that arebeing implemented in the health service? That isn’tnecessarily the case.John Seddon: Yes and no.

Q336 Grahame Morris: That’s a good answer.Could you elaborate on your opening commentswhere you suggested that commissioning, either in itspresent form or as envisaged, would drive up costs inthe health service?John Seddon: I would be happy to. We first saw thisphenomenon in housing repairs and, to a systemsthinker, it is identical to commissioning in the healthservice. In housing repairs people use a schedule ofrates. It is everything that could go wrong with a




house and in it is a specification for what you shoulddo, with standard times and materials. It wasmandated as best practice by the centre and the ethosin it is that we need to manage costs.Actually, when you employ the schedule of rates inhousing repairs you have a whole series of problemsand they are all created by the inability of this design,in particular the schedule of rates, to absorb variety.Not all tap repairs are the same. And we have madethis mistake in health. Because having a schedule ofrates stops you absorbing variety you get both underand over provision. With under-provision “You getwhat we do”, not what you want. I disagree with Alan.We’ve industrialised a lot of voluntary sector servicesthat are bought on a contract against a specification.We’ve done the same with things like health andequality as part of health agenda and so on. And scalecontracts as well in adult social care—a big mistake.With over-provision you are, effectively, incentivisingany provider to do more work, and that happens.On top of this, of course, we have a wholeadministration for coding, re-coding, doing lots of re-work because we get it wrong at the start and so on.This creates a lot of repeat demands into services. Icall these demands failure demand which I define ascaused by a failure to do something to turn it roundfor the customer. We know nobody has studied failuredemand in health but we have studied it extensivelyin adult social care. It typically runs at about 80% ofthe total demand under the system.When you couple these ideas up with standard timesand standard costs you effectively discourageinnovation and you discourage any reduction in costsand when you add to that standard tariffs it encouragescherry-picking, so “We’ll do the things that advantageour position.” What we know in housing, and to asystems thinker it is very like health, is that in housingwhen you dispense with the schedule of rates anddesign the service against demand you halve yourcosts at the same time as improving your service. Ithink that kind of opportunity is available in healthbut you would have to completely re-think thephilosophy of commissioning.

Q337 Grahame Morris: With what alternative?John Seddon: We made this mistake years ago in theprivate sector and private sector companies got out ofthese mistakes. If we think that we should organisework on the basis of standard times, that is a bigmistake because there is variety in work. So we haveto get off the idea of the times that things should takeand the things that should be done, which is allincluded in the specifications, and start understandingand measuring what things do take and what needs tobe done. When you make that simple shift you arestarting to work with measures that help youunderstand and improve the performance of thesystem which you do not get when you use standardtimes, which are a feature of industrialisation.Chair: Grahame, do you want to follow that up?

Q338 Grahame Morris: I do, but it is more relatedto some of the earlier comments or responses inrelation to how critical it is that GPs are involved inthe commissioning cycle. In an area like mine, in

Easington, in County Durham, a population of about100,000 where we have about 50 GPs, in order toproperly participate and make it a success whatproportion of those 50 GPs would you think shouldbe actively involved in the commissioning process?Kingsley Manning: First, can I come back to yourfirst question, which is to say, yes, we are a publiccompany. We are quoted on the Stock Exchange. Weare owned almost entirely by our staff and pensioners.Therefore I have a fiduciary duty to deliver a profit tomy shareholders who depend upon it for theirpensions and a return on their savings. In doing so,we wish to operate at the high standards we have donefor over a decade. I have been working in the healthservice for 30 years and I believe that we havedelivered value for money and enormous benefits toour clients over that time period, which is notincompatible with us being an ethical commercialcompany.Do we stand to make profits out of the reforms?Possibly. We won’t make any profits out ofcommissioning as Mr Lansley is quite clear thatnobody will be allowed to make profits out ofcommissioning, indeed which I think we would agreewith. That would be the ability to take a profit relatedto an inflation-based risk and I think that would beinappropriate.

Q339 Chair: You could, presumably, give profitableadvice about how commissioning could be structured?Kingsley Manning: We already provide advice toabout 12 or 15 PCTs as it stands on commissioningwith a significant return on investment in those casesand an improved outcome for patients and improvedcost-effectiveness for the NHS.I believe that the changes in the White Paper, whichhave to be taken as a whole, including the AWPprocess as well, but particularly aroundcommissioning, do allow the possibility of having asignificant engine for change being driven not just byGPs but, as importantly, by patients and citizens. Ithink it is terribly important—there was a lot ofdiscussion in the prior session about the role ofclinician here—that the clinician is not the centre ofthis system, or at least it shouldn’t be. It should be thecitizen, not even a patient, because we should bedealing with people who are well, not just ill. Theproblem about being a patient is that one immediatelybecomes a supplicant of this system and one of thereally interesting backbones of the White Paper is theinformation revolution that will go along with this,such that we will have patients informed in a muchmore powerful way. Citizens will be able to see theperformance of hospitals, individual GPs andindividual surgeons and be able to judge the outcomesof individual providers. It is therefore giving, for thefirst time, the ability potentially to be partners in themanagement of their own healthcare for both wellnessand illness. It seems to me that is a terribly importantpart of it.That, coupled with the ability to have a choice ofproviders, which I think is the second very importantpart of this, has to be seen as being the other side ofthe commissioning process. This is not simply aboutsetting a clinician up as the centre of the system, but




the citizen and the patient. What that requires is, Iam afraid, John, industrial level risk-taking, industriallevel infomatics and industrial level support to enablethose patients to take choice.The evidence in mid-Staffs, the evidence of the extentof choice network, is that if patients are giveninformation and if the choice is important, they willtake it. If you have a child and your daughter or yourson has cancer, you want a choice of the best cancerprovider available to you. Citizens are much moresophisticated about this, and therefore choice doesmatter. Increasingly we should trust patients muchmore and trust citizens much more to become muchmore powerful in the management of their ownhealthcare.Alan Downey: I think there was a question about thenumber of GPs who should be involved incommissioning and I think the simple answer is all ofthem because every clinical decision that is taken bya GP, indeed every clinical decision that is takenanywhere in the NHS is in effect a commissioningdecision. There are financial and other consequencesthat flow from it.I don’t think it is necessary or desirable for theDepartment of Health to be prescriptive to the GPconsortia about how they should organise themselves,about their governance structures and about how theyshould decide on decisions that need to be taken otherthan those which are taken at the individual GP level.So if one consortium decides that it wants to devolvea lot of responsibility to all GPs and another decidesthat it wants to raise some of that decision-making upso that it can be taken by one or two individuals onbehalf of the whole consortium, that is a decision foreach individual consortium to make. And it is afeature of the system that the Government is trying tointroduce now that it is about trying to empower theseGP consortia to set things up in a way that they thinkwill work best in the interests of their patients ratherthan prescribing a particular approach which wasmore a feature of the system that we had before theelection.

Q340 Grahame Morris: So are you targeting areasthat are currently under-doctored where you have asmaller proportion of GPs per head in selling yourservices or offering them in the terms that MrManning described earlier?Alan Downey: We are not targeting areas in that sensebecause it is not our role to provide medical services.What we have been doing is holding discussions witha number of consortia that have started to perform totry and provide them with assistance to enable themto think through the roles that they have taken on.I don’t want to dwell on this point about profit becauseKingsley has addressed it already, but in the currentclimate where the Government as a whole and theNHS in particular is under huge financial pressure,there is very little money around to pay the bills ofthe likes of KPMG and Tribal and so on. We are notactually earning any money at all. We are not makingprofit at all from the work that we are doing at present.It is no problem to us because, if you take a firm likeKPMG, approaching 90% of our business is with theprivate sector. We only provide to our public sector

clients the services that we also provide to our privatesector clients and if they decide that they no longerwish to buy those services and the Governmentdecides that they no longer represent value for money,it is not actually a huge problem to us.

Q341 Grahame Morris: I can’t let you off the hook.Is that a kind of long game, a kind of what we woulddescribe in layman’s terms as a loss leader inanticipation of a wholesale privatisation that privatesector companies would be involved in and that youwould subsequently profit from?Alan Downey: That would certainly be my hope, thatby staying in the game at the moment we will be ableto continue to provide services to the NHS in the longterm. But that is by no means guaranteed. We are notmaking a calculating business decision based on anaccurate assessment of risk. We are simply staying inthe game at the moment because we think it is theright thing to do. It is perfectly plausible to believethat, in due course, there will be far, far less work forfirms like ours not only in the NHS but in the wholeof the public sector.

Q342 Valerie Vaz: I am sorry, the right thing to dofor whom?Alan Downey: For the public sector clients that wehave relationships with.

Q343 Valerie Vaz: Right. Not for the patientnecessarily but for your clients?Alan Downey: We are not engaged by patients so wedon’t have a direct relationship with patients.

Q344 Valerie Vaz: They’re the ones that are payingtheir tax to get a service.Alan Downey: Of course they are, but you have todeal with the people who are in a position to seekyour advice, enter into contractual arrangements andso on. Ultimately, the whole point is to try andproduce a health service which delivers a higherquality service and which delivers value for moneyfor the taxpayer. That’s why we do what we do. Weneed to be able to make an acceptable level of profit inproviding our services because we are a commercialorganisation and if the time comes when we are notable to make an acceptable level of profit in the longerterm, then we will revert to providing services to ourprivate sector clients which, as I say, is approaching90% of our business.Chair: I suggest we move on from that subject.

Q345 Chris Skidmore: I am keen to draw out theexperiences of your organisations in either observingor enacting change, both in terms of clinician-ledcommissioning and also in terms of the transformationprocesses involved. First, Mr Downey, I’m veryinterested in what your colleague Mark Britnell hadto say at the NHS Alliance Conference on 19November. I don’t know if you are aware but he saidthat KPMG did some work in a big northern city withan access population of 1 million and that, throughintroducing clinically based decision making, that wasable to deliver over £200 million worth of efficiencysavings, roughly about 20%. So you are meeting the




Nicholson challenge over and above throughclinician-led commissioning. Would you be able toelaborate on that and give a bit more detail about whatthat programme was?Alan Downey: Yes. I think it would be accurate to saythat we identified savings to the tune of £200 millionrather than that we delivered that amount becausedelivery, in most cases, depends on the organisationsin the NHS acting on our recommendations. But oneof the issues and one of the challenges which the NHSfaces is that care tends to break down when patientscross the boundaries between different organisationsand they move from primary care to communityservices, to secondary care and so on. The particularproject that Mark was referring to was one where wewere able to work in a single project with all of thehealth service providers in a particular locality, withthe primary care trust, with the mental health provider,with the community health services provider, withthree acute trusts and so on. By bringing all of thoseorganisations together, it was possible to identifysome very substantial savings that could not beachieved within the organisational boundaries of oneof those players. It was necessary for there to be co-operation across the boundaries.

Q346 Chris Skidmore: So that’s including socialcare as well?Alan Downey: This was primarily focused on servicesdelivered by the NHS but the local authority was alsoinvolved in the programme and so there were somesavings there as well. That is the kind of role that anorganisation like ours or, indeed, other organisationsthat we frequently compete with can play, which is tohelp facilitate decision-taking across boundarieswhich are genuinely quite difficult within the NHS asit is currently structured.

Q347 Chris Skidmore: Do you want to saysomething, Mr Seddon?John Seddon: I haven’t earned any money from this,given the responses earlier, but I think it is as well forthe Committee to know that in Plymouth there is aconsultant neurologist who has followed myprinciples. I teach managers not to manage costbecause it drives your costs up but manage valueinstead. He has transformed their stroke care. This isa delivered saving, not a maybe saving. Originally thecost of stroke care in Plymouth was £6,000 a patient.It is currently running at £3,000 a patient.Interestingly the tariff is 4, which is a problem Ireferred to earlier about arbitrary measures and tariffs,and he did it all on his own, without any help fromme or anyone. He did it all by reading my work andworking it out.In adult social care, most interestingly, there havebeen major savings and this has occurred in Wales. Itis indicative that it occurs in Wales because Walesdoesn’t have the same kind of regulatory control thatwe have in England. But there are significant savingsin administration, very large savings in use ofmaterials and the provision of materials but the largestsavings come from solving people’s problems in theircommunity, not driving them into care homes. That isall evidenced and is reported by the Welsh Audit

Office in a report earlier this year which you canaccess. I think it is really important to say that thesedesigns have been achieved by ignoring the stricturesfrom the centre.

Q348 Chris Skidmore: That is surely what theWhite Paper is partly trying to achieve, devolvingpower. It is plastered across it.John Seddon: I think the White Paper lackscoherence and good operational clarity. As I saidearlier, I think it is very important the clinician shouldbe involved in decision making but I would go further.I would say in order to design a better health serviceyou really need to understand demand. If we canunderstand demand we can design a better healthservice. The clinician that has used my idea, StephenAllder, in Plymouth—I think you should invite himhere, by the way—has studied demand in his trust forall major conditions, the first person to do this, to myknowledge, and the interesting thing is that allconditions are stable in demand terms. To a systemsthinker that is Christmas because it means we can startdesigning a service that works because we know thesethings are going to occur. Most of the people in thatsystem wouldn’t believe that demand is stable. Theythink it is going to be random. They think it is risingbecause we are getting older. Actually, the data showsthat demand is stable by major conditions.

Q349 Chair: Do our other witnesses agree with theproposition that demand is stable because it iscertainly not evidence that has been presented to ushitherto?Kingsley Manning: Fundamentally. First of all, youcan’t treat demand in healthcare in any way like ahomogeneous section. It is not. It varies enormously.But demand for most services is incrediblypredictable. We can be pretty certain how manypeople are going to have heart attacks in Barnet inthree years’ time. Predictive analysis is an incrediblypowerful tool. We are doing it for 15 or 16 PCTsalready. You can predict the people that are likely tohave falls and those that are likely to suffer fromcancers in a very, very effective fashion. Demand formost of these conditions is both predictable and stable.The shifts in demand that have occurred are usuallysystem-generated and are very much in unplannedcare—emergency admissions—and are very often todo not so much with clinical conditions but with socialcircumstances, the failure of social care provision,under-provision, and the failure of having alternativesto, for example, hospital admission for complexelderly care services. So you cannot treat these thingsas separate but we have known for a long time howto measure demand for healthcare in great, great detailand to be able to predict it increasingly withsubstantial accuracy.

Q350 Chair: But it is also true, is it not, that demand,as experienced by the healthcare system in terms ofattendances, in terms of treatment episodes and interms of alternative treatments available, has been ona rising trend?Kingsley Manning: But fairly modest. You havealready heard today that in places like Cumbria and




others it hasn’t been rising. We have had a year onyear pretty standard rise in any attendances inunplanned care, about 3% across the country. But itdoes vary. There is not an infinite demand for peopleto have heart surgery. There is not an infinite demandfor people to have cataracts. There is only a finitenumber of cases of this. There is a pretty much infinitedemand, as I keep telling my family, for loving careand attention but that is different. That is a differentelement of care. So you have to be very clear aboutwhat you mean by rises in demand. You have tosegment it.

Q351 Chris Skidmore: What about Wanless and therise of the demographic trend for older people for thenext four years of their care?Kingsley Manning: Yes, in some respects. But, firstof all, at the moment it is actually within a lull. Thereis rising expectation of some elements of care but weare still uncertain yet how that demography will playout in terms of the elder population. Actually, it is thenew generation, as I am approaching being one ofthose people. I am going to be much fitter, much moreable and much more demanding as a patient and mydemand will be very different.

Q352 Chris Skidmore: This one is longer becausethe whole model of the efficiency gains are modelledon the NHS standing still by having these £15 billionto £20 billion savings delivered to be reinvested.Kingsley Manning: But I come back to my originalpoint which is that David Nicholson’s current plan isthat most of that demand will come out of technicalefficiency gains within provider hospitals. He isessentially saying, “I’m going to force you to employless people, use less concrete and use less drugs todeliver more care” to the providers. He is only, at thisstage, assuming some 30% of gain will come fromstemming demand or finding alternative patterns ofdemand. Ultimately we are going to have to do a lotmore to be able to live within the cash envelope andthat will require us to think very radically aboutalternative supply mechanisms or different patterns ofcare. But part of this demand is complex and it ischanging and a lot of it is to do with not justdemography but also our assumption about what carewe deserve, what care we have as a right and whatcare we require. That is a very much more complexissue than a single epidemiology of the incidence ofcancers.

Q353 Chair: Would Mr Downey like to contribute tothis discussion on demand?Alan Downey: I’m not sure that I would because I amnot an expert.Chair: Don’t feel you have to.Alan Downey: I’m not an expert in forecasting inthese matters and I think it is probably best if I leaveit at what Kingsley has said.

Q354 Chris Skidmore: I had an additional question,Mr Manning. Obviously your organisation has majorexperience in enacting transformational programmesacross the country. The NHS is now facing its biggesttransformational organisation in 60 years with the

abolition of PCTs, SHAs and the shift of clinicianpowers toward GPs. That is obviously going to costan enormous amount in redundancy packages. Oneestimate from the Department of £1.7 billion wasalready, apparently, put aside by the previousGovernment. Other witnesses and evidence have saidit is nearer £3 billion. I just wondered from your ownexperience of redundancy packages if there is somemodelling or some way you might be able to explainto us how realistic the £1.7 billion sounds, whether itshould be higher than that?Kingsley Manning: PCT management tend to havebeen members of the NHS for quite a long time andthey are reasonably well paid. A rough rule of thumbis somewhere between £50,000 and £100,000 perperson made redundant. It is as simple as that. Youcan work it out yourself from the numbers. We havediscussed with the Department ways in which someof that can be mitigated, through, potentially, thetransfer of staff to other providers of support services.The TUPE staff will go into various areas. We arealready doing it, and we have made that clear to theDepartment, that if we can help in mitigating thatredundancy and securing continuing employment forpeople through joint ventures and the creation ofmutual and social enterprises with ourselves aspartners then we are prepared to do that.

Q355 Chris Skidmore: In terms of the figures, howmany PCT commissioners may end up being maderedundant? Would you be able to give a rough figure,maybe, from your own experiences of what hashappened in other circumstances Tribal has beeninvolved with?Kingsley Manning: We have undertaken an analysis.There are about 37,000 people currently employed byPCTs. That’s a misleading number because asignificant number of those people are engaged indoing elements like public health, like publicengagement and a whole host of other things.Somebody said earlier it is all the things that PCTsget on and worry about. The actual number employedcurrently in commissioning is quite small, relativelyspeaking. We think that with GP consortia the totalnumber of people employed between GP consortiaand the National Commissioning Board is probablybetween 10,000 and 15,000.

Q356 Chris Skidmore: That is 10,000 to 15,000currently employed?Kingsley Manning: No, you would need to employwith GP consortia and the National CommissioningBoard.

Q357 Chris Skidmore: So there’s a possibility that10,000 to 15,000 from the 37,000 currently withinPCTs could find alternative roles within the newstructure?Kingsley Manning: I would hope so. The sensiblething is for the Department to find ways in whichthose staff can be transferred to consortia or to supportservice organisations to avoid the necessity of goingthrough an unnecessarily expensive redundancy route.




Q358 Andrew George: Representing the sector thatyou do, where do you think, having looked at theWhite Paper, you can be both most helpful indelivering the objects of the White Paper and whataspects do you think would be most profitable for theprivate sector to engage?Alan Downey: Speaking on behalf of my ownorganisation, I said at the beginning that the focus ofthe advice and support we provide is in the financialcommercial field. Where we think we can be mosthelpful to GP consortia and indeed to other parts ofthe NHS is in helping them to implement goodfinancial management regimes within theirorganisations, to get a good grip on their finances,helping them to reduce costs without compromisingquality, helping them to improve efficiency and, if weare looking at the larger organisations within the NHS,helping them to effect transactions which will helpthem to deliver their strategic objectives. For example,there are a number of acute trusts which are in theprocess of taking over the community servicesorganisation so they need to conduct their duediligence on the organisation to make sure that theyare integrating them in an effective and cost-effectiveway. That is where we play as an organisation.Our strong preference is to provide skills andexpertise which are not available within the NHS andwhich will never be available within the NHS andwhich the NHS will buy on a time limited basis. Wewill provide that expertise and then we will depart.We are not in the business of trying to take over thejobs of people within the NHS. We are not in thebusiness of what we call manpower substitution. Wethink it is important that within any organisation, andparticularly within any public sector organisation,there should be strong, competent, self-confidentbusiness people who can run those organisations whowill turn externally for advice only when they reallyneed it. That is the kind of advice that we provide toour private sector clients and it is the kind of advicethat we like to provide and want to provide to ourpublic sector clients as well.

Q359 Andrew George: Could you do that on thebasis that the NHS remains in the present structure tothe same extent or do you think you could do more interms of offering that service under the proposals ofthe White Paper?Alan Downey: As with the provider of any service,there is a question of supply and demand. At themoment demand for our services is high butwillingness to pay is low, which is an interestingsituation to be in. We could certainly do more. It isour view that financial and commercial skills are notas strong within the NHS as they ought to be and thatthey could be improved. We would certainly be keento do more and, what is more, we would be willingand keen to do more on a basis where we put ourfees at risk where we were only paid if we deliver asuccessful outcome. If it was, for example, a projectwhere the focus was on reducing costs we would onlybe paid a small proportion of the costs that we helpedto reduce when the saving was actually delivered.That’s the nature of our business.

Kingsley Manning: I would just say we operatealready in a number of our projects on both aperformance basis and on a risk of return basis so weoften inventively invest in projects or services andonly get paid proportional to the success of those. Ithink, generally, by the way, that the most attractiveopportunities for new suppliers into the NHS are todo with service provision.

Q360 Andrew George: I am sorry, to do with?Kingsley Manning: To do with service provision, newmodels of care. You have heard today about peoplewith new models of diabetes care, chemotherapy athome services and the rest of it. That is the most likelyarea for private sector development and independentsector development—more broadly, the third sector.We are not in provision. We will not enter into themarket for direct provision of clinical services. Weprovide a range of technical and professional services,both advisory and in commissioning of services to theNHS. We have invested very substantially in thedelivery of very high quality, very, very innovativeinfomatic services which we do on behalf of about adozen PCTs where we are bringing international levelskills and innovation in the use of a series of verypotent products and tools for analysis and support indecision making. We also see opportunities forhelping GP consortia to undertake commissioningdecision making which we are doing with a numberof PCTs at the moment and also in the delivery ofwhat we would call care navigation services where weengage in directly supporting the patient with the GPin managing their own care pathways and their ownwellness of health over a period of time.

Q361 Valerie Vaz: Is Mercury Health that part ofyour company?Kingsley Manning: We sold Mercury Health six yearsago now.

Q362 Valerie Vaz: But you were providing thisservice as well, were you?Kingsley Manning: But that was, I am afraid, wellbefore I became a partner in Tribal.

Q363 Valerie Vaz: I am trying to see what the futureis like.Kingsley Manning: No, we won’t. In common withmost other suppliers of ISTC services, it was a greatway of destroying shareholder value.

Q364 Valerie Vaz: So you just see yourself assupporting commissioning as opposed to actuallyproviding the service as well. Is that right?Kingsley Manning: Yes, and this is something wetouched on before. We think that there is a potentialconflict of interest between people supportingcommissioning services and providing servicesthemselves. That seems to me to be fairly obvious.

Q365 Valerie Vaz: But you do see there is a conflictof interest, do you?Kingsley Manning: If we were to provide clinicalservices, care services and commissioned them at the




same time, yes, there is a clear conflict of interest. Wewouldn’t do that.

Q366 Valerie Vaz: But you see other people doingthat?Kingsley Manning: I think that there are people whothink that it would be very nice to get a very largecommissioning budget and then potentially developbusinesses which they might then potentiallycommission to deliver services. I think there is a realproblem about that.

Q367 Chair: Do you want to contribute on this, MrSeddon?John Seddon: Very briefly, yes. I doubt that I will getthe opportunity but if I was asked I would very muchlike to help the Minister and his civil servants in theDepartment of Health understand that managing costsdrives your costs up, that the last thing we need isindustrialisation and that we need to move fromarbitrary measures to real measures that tell us aboutthe achievement of purpose. I think the purpose of thehealth service ought to be for every demand to havefast and accurate diagnosis and then for eachcondition to be treated on time as necessary. If webuilt measures around that we would be half-way toimproving the system. Then I would very much liketo help clinicians understand how to manage valuerather than costs which would drive costs out of thesystem. But I doubt that I’ll be asked.

Q368 Rosie Cooper: Mr Manning, there are twoquestions I would like to ask but the first is you havesuggested that patients should be allowed to form theirown commissioning group in the same way as parentscan run schools.Kingsley Manning: You have been reading my paper.Rosie Cooper: What do you think the advantage is ofsuch user-led consortia, what are the potential pitfallsand, as I have been trying to push the Secretary ofState for a number of weeks, do you think we couldhave the best of all worlds by having patients actuallyinvolved and on the boards of consortia?Kingsley Manning: I would never, clearly, in my jobever disagree with the Secretary of State, whoever itwas, over the last 30 years.Chair: I don’t remember that.Kingsley Manning: I was simply wondering aloudwhy these things were called GP commissioningconsortia because there are nurse-led generalpractices. Why shouldn’t we have clinician-led ormedicine-led consortia? In those circumstances, whywasn’t I being allowed to set up commissioningconsortia for the benefit of middle-aged men who areusually very under-represented at these things?There is a really interesting opportunity aroundconsortia that will lead to specialisation andsegmentation where, potentially, people will be ableto make choices. There was a very interesting questionearlier about geography, for example. I think peoplewill begin to make choices on outcomes based uponthe performance of consortia and if you have aparticular condition or are in a particular locality youmay well choose to register with a GP, and thereforewith a consortium, that much more reflects your needs

and requirements. If you are HIV-positive and you livesomewhere where the incidence of HIV-positivepatients is very low indeed, wouldn’t you do better toregister with a consortium in Fulham, or wherever,that has real expertise and knowledge about that?The logical continuation of that is that we will have asystem which may reflect communities, as they areincreasingly becoming, that are less to do with placethan with self-definition, to do with a virtualenvironment, to do with condition, stage of life,choice or preference. These communities are notnecessarily related to place, certainly not in urbanenvironments and the consortia should reflect thatdegree of specialisation. The notion of havingconsortia that are driven by condition or particularinterest—mental health, a long-term condition,dementia or diabetes, for example—is potentially avery exciting possibility and I can’t see why it shouldnot be possible within the plans to at least enable thatto happen. I think it will happen inevitably, by theway.

Q369 Rosie Cooper: What do you think the pitfallsof that would be?Kingsley Manning: The pitfalls for anything which isdriven by individual interest are narrowness andvested interest but that is already the case. Vestedinterests drive the NHS as it is today. They drive afalse distribution of resources and they drive falsepriorities, both because there are vested interestsuppliers and vested interest in particular patientgroups. This way, at least, it becomes transparent.

Q370 Rosie Cooper: So there will be a great benefitto consortia, however described, if they had coalitionsand patients, the two sets of people for whom this hasgot to work, at the core.Kingsley Manning: I think that in extremis, and yourChairman has spoken about the possibilities of writingout vouchers and so forth, you end up getting peoplemaking real choices between commissioners and thecommissions become the servant of the members.These things should become membership associations.They should become members of the consortia andmembers should be in a situation where they begin todirect what its priorities should be.

Q371 Rosie Cooper: Okay. We will obviouslyinvestigate a little further. Under the newcommissioning system, where do you think thegreatest areas of potential growth for your businesswill lie?Kingsley Manning: A great deal has been written andspoken about support services to consortia, much of itmisguided. The total value of those services, at about£5 or £6 a head, will be £250 million or £300 million.It will be extremely difficult for any commercialorganisation to deliver support services to GPconsortia. It will require very substantial scale andinvestment. We may well consider doing that, but Idon’t think that we see it as being an overly profitableor extensively interesting opportunity. The mostinteresting opportunity for us is providing technicalsupport services to the management of lots ofconditions and the use of patient management systems




coupled with care navigation based on very effectiveinfomatics where the opportunity to deliver vastlyimproved outcomes for patients combined withsubstantially reduced costs means that there is theopportunity of driving both scale and the potential formargin and taking risks, by the way. That is whereyou take risk.

Q372 Rosie Cooper: In your evidence earlier todayyou were very clear about conflict of interest betweenthe commissioning and provider role. In the past,Tribal, for example, has been involved incommissioning and in providing via Mercury, one ofyour subsidiaries—Kingsley Manning: I want to make this absolutelyclear. We sold Mercury, as I said before.Rosie Cooper: Yes, absolutely.Kingsley Manning: And we were not involved doingany commissioning work at that point.

Q373 Rosie Cooper: No. Forgive me, I am notsuggesting you are now but there is an example, aprime example, of where commissioning andproviding in a system existed together. There may beother subsidiary companies and organisations wherethis could in fact be a creep and a big danger. Do yousee that?Kingsley Manning: I think it is a problem for thewhole system and one of the issues that GPs arestruggling with is, do they want to be providers orcommissioners and where did the line divide? Thecommercial imperative is very often to becomeproviders whilst remaining part of beingcommissioning consortia.

Q374 Rosie Cooper: Commissioning you can’t makea profit, providing you can?Kingsley Manning: There’s hugely more money to bemade for GPs and everybody else in the provision.

Q375 Rosie Cooper: So we’ll not have very manycommissioners and lots of providers?Kingsley Manning: The scale of the marketopportunity for the independent sector is vastly moreon the provision side than it is on commissioning. Toreiterate, just do the mathematics. The managementcosts per head that the Government Department istalking about is going to be £5 or £6 or £7, somethingof that ilk. Fifty times that is about £300 million. Thecommercial sector and others are being asked toprovide support to GP consortia for that amount ofmoney which was previously done by PCTs spendingnearly £1.7 billion. It is not a big market. It is not avery big market. We are very interested in doing it.We think it is a really interesting process. We think itis really exciting stuff. But we are not and nobodyelse is going to get very rich on this.

Q376 Rosie Cooper: I was wondering whether Icould have one sentence, a dangerous sentenceperhaps. The medical community is a reasonablysmall community. It’s a big community but in an areaeverybody knows everybody and they will know theproviders. What is the danger of those relationshipsbeing too close in a conflict sense?

Kingsley Manning: I think there’s an extraordinarydanger but that is already the case. This is a highlystable and self-satisfying system which basicallyreflects the vested interests of the parties participatingat a local level. It is highly collusive. It delivers very,very well in a satisfying way to suit the services. Butthe reason why you go to mid-Staffs, the reason whyyou go to Medway, the reason why you go to Sheffieldand the reason why you go to Bristol is because thesesystems are not self-reflecting or critical, they arehighly collusive.

Q377 Rosie Cooper: Can you see anything in theWhite Paper that will deal with that?Kingsley Manning: Yes, I do. I think that thepublication, which is the Secretary of State’s intention,of virtually everything that can be published onoutcome data and on performance data will lead to alevel of transparency that will enable there to be anenormous light shone on the process. It will simplynot be possible for a GP consortium to enter into acollusive relationship with a particular chosenpreferred provider. It will be obvious in the data. Itwill be obvious to patients and it will be obvious totheir competitors.Rosie Cooper: I do hope you are right.Alan Downey: If I could just support that, if we’vegot strong GP commissioning consortia, if we have areasonable level of competition for the provision ofservices and if we have a high level of transparencyand data published for the benefit of patients, thosethree things between them should ensure that we havea health system that delivers high quality care andgood value for money. I don’t think, in principle, thatit is at all complicated. Clearly getting there is a realchallenge and that is what the NHS needs to manageover the next few years.

Q378 Yvonne Fovargue: You mentioned the thirdsector. It has always been an aspiration to get the thirdsector more involved in this and it hasn’t workedparticularly well so far.Kingsley Manning: It is very patchy. The mostsuccessful commercially aggressive organisation inhealthcare that I have seen is Turning Point, whoseinnovation, combined with their commercial nous, issecond to none. I hold them up as a beacon of howthings can be done successfully.

Q379 Yvonne Fovargue: How do you feel the WhitePaper would expand that across the country, becauseit is very patchy at the moment?Kingsley Manning: It will be very difficult. Theproblem with healthcare is that it requires verysubstantial investment, the regulatory barriers are highand most independent typical capital organisationsfind that very difficult. But there are glowingexamples: the hospice movement, St Christopher’s insouth London and a range of others. The marketopening will clearly not be there but there will bespecific efforts under AWP to be open to the voluntarysector, the third sector and the independent sector.That will be an enormous opportunity for them andan opportunity to deliver very interesting new models




of partnership with the more normal commercialstructures.

Q380 Dr Wollaston: Based on your company’sexperience of providing management support to theNHS, what do you feel is the appropriate level for themanagement allowance?Kingsley Manning: Much more than they are goingto set it at.

Q381 Dr Wollaston: We’ve not had any clarity,really, about them. There have been murmurings butwhat would you, in an ideal world, think it should be?Kingsley Manning: It is very true, and PeterWeaving—I don’t know if he is still here—made thispoint several times about how his experience is such,about the importance of good support andmanagement services. There is a danger that wepotentially cut it at a level which means that we aredown to absolute basics. That will then mean, andPeter has talked about this before, that you are thengoing to make choices about: Do you spend some ofyour commissioning budget on management andsupport rather than just your management budget? Ifit is too low there will be benefits in doing that. Ourview is that potentially nearer to £10 than £5 itbecomes effective.Alan Downey: There are also risks associated withsetting the management allowance too high, strangethough that might sound, because one of theadvantages of the GP commissioning approach ascompared with the former PCT approach is that it ispart of the Government’s aim that these consortiashould be entrepreneurial, innovative and find newcommercial ways of doing this job successfully.Anybody who has worked closely with PCTs wouldprobably say that although a great deal of good workwas done, a huge amount of money was also wasted.You can pump too much money into the system andalmost drive poor value for money as a result of doingthat. If the GP consortia can be resourced to anadequate but not generous level, the Government willprobably have struck the balance about right.

Q382 Dr Wollaston: So, £10. Any advance on £10?Alan Downey: It would be purely speculative to namea figure.

Q383 Dr Wollaston: So you can’t name a figure. Youthink it should not be set and just see where itarrives at?Kingsley Manning: No. It has to be set. I agree withAlan that if you over-fund it, you will effectivelyencourage a dysfunctional market and waste. It needsto be set at a level that reflects the underlying scaleeconomics of providing these services and that iscertainly probably sub-ten pounds.

Q384 Dr Wollaston: You think around £10?Kingsley Manning: This is highly speculativebecause, frankly, the data doesn’t exist. The analyseshave not been done. The NHS has set out to cut itscosts by this wonderful figure of 46%, which iswonderfully, spuriously accurate. Essentially, it isgoing to be dramatically reduced and then it is up to

us and other potential suppliers to see whether or notwe can deliver an effective system within thatenvelope. That’s the challenge.

Q385 Dr Wollaston: So there is no evidence base onwhich to base this?Kingsley Manning: There are probably tons and tonsof analyses and spreadsheets but, at the end of theday—

Q386 Chris Skidmore: But if you deliver at £5 andit is set at £10, the consortia take the £5 in theirpockets? You were talking about £5 to £6 as possiblysomething that you could deliver yourself.Kingsley Manning: I am talking about the total costsof delivering the service. I am very happy to sharewith the Committee our analysis of the underlyingeconomics of these things, but there are core costshere. You have to set up infomatics, data centres,transaction services, 24 by 7 staff. There are coreservices you need and then there is volume and thatis why it is going to be very important for any supplierto achieve realistic volumes to be able to support this.I thought that the question around who pockets thedifference was going to be in the Bill. I repeat MrLansley is not terribly keen on people making profitsout of this.

Q387 Chris Skidmore: I didn’t mean profit, I meanin terms of the consortia itself managing its budgets,its possible deficits and taking over PCTs. If theallowance is set at £10 and then, suddenly, anorganisation comes along and says, “We can deliverthat for a management allowance of £5—Kingsley Manning: Bear it in mind that at apopulation of 200,000 the average consortia wouldhave about £400 million of commission budget andan average of less than £2 million for the managementbudget. The management budget is tiny bycomparison with the commission budget.

Q388 Chair: Would Mr Seddon like to contribute tothis debate from, as it were, outside the mainstream?John Seddon: I have learnt, in my life, that the mostimportant thing to do is to redesign operations beforeyou discuss what levels of management you want. Ithink the evidence is there that if we redesign healthoperations, we could save a fortune at the same timeas improving the service and then you address thequestion of what you want the management to do. Iknow that is rather odd but it works that way roundin the private sector.Chair: I think that came dangerously close to amainstream view.

Q389 Valerie Vaz: A question for you, Mr Manning,in your description of this virtual patient. Where doyou see this accountability of public money? Do yousee it as an issue?Kingsley Manning: It is a tremendous issue. The issueof the Government’s accountability through the GPconsortia—the question was asked as to theaccountable officer—my understanding is that itwould be the chairman but they will also need toappoint a finance director.




Q390 Valerie Vaz: They’re not elected, are they?Kingsley Manning: There is a real question aboutthat. There are boundaries here between the electedprocess, which ends up with one sense ofrepresentation, and the participation as a memberwhich ends up with a different process ofaccountability. I would like to see the empowermentof the citizen as a member of these organisations, andparticularly in relationship to their own experience ofthem and having the right to leave or to move awayfrom them. I am concerned, and we will have to seehow the relationship with the local authorities workand the rest of it. There are models where thefoundation trusts have gone for membership modelsand governance and there have been temptations tohave elected members. Indeed, some original thinkingabout consortia was from those members. But thatresults in a certain type of representation which tendsto be incredibly institutionalised and, again, to reflectvested interests rather than the common interest of theaverage citizen.

Q391 Valerie Vaz: You have concerns about thisunder the White Paper?Kingsley Manning: I think everybody has concernsabout the distribution of £80 billion to a large numberof organisations. I know Mr Lansley does because theaccounting and audit issues of that are going to bevery substantial indeed. The level is NHS fraud isalready significant. We will need to be very carefulthat that level does not rise further through a reductionin the control mechanism.

Q392 Valerie Vaz: You described the White Paperas denationalisation?Kingsley Manning: I got told off for that.

Q393 Valerie Vaz: Do you see it moving to aprivatisation policy?Kingsley Manning: No. I tried to explain to MrLansley that when I said this, I wasn’t talking aboutprivatisation at all. What he is very interested indoing, and again I understand this is helpful, is thedevelopment of a social enterprise model, a mutualmodel, which is moving people out of statemanagement into self-management organisations—effectively, a denationalisation process. You can eitherbelieve that or not as being a good thing. It seems tome a very exciting prospect that you effectively sayto provider organisations within the NHS, “If youwish to take control and manage this organisation foryourself, you will have a right to do so, a right toprovide. In so doing, you will move outside theconventional historic state and become somethingmuch more like a university structure.” It is a boldstep and it would change the nature of the servicedramatically but it would create a very, very large,effectively not-for-profit, independent sector, avoluntary sector, through the denationalisation ofcurrently state-managed assets.Chair: We have covered a lot of ground. Thank youvery much for your contribution this morning. We willreflect on it in the context of our report.

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Tuesday 7 December 2010

Members present:


Rosie CooperNadine DorriesYvonne FovargueAndrew George

________________


Witnesses: Jeremy Taylor, Chief Executive, National Voices, Katherine Murphy, Chief Executive, thePatients Association, Sophie Corlett, Director of External Relations, Mind, and Andrew Harrop, Director ofPolicy and Public Affairs, Age UK, gave evidence.

Q394 Chair: Good morning, ladies and gentlemen.Welcome and thank you for coming. Could I ask youvery briefly to introduce yourselves so we know whowe have the pleasure of talking to?Katherine Murphy: Katherine Murphy, ChiefExecutive of the Patients Association.Jeremy Taylor: Jeremy Taylor, Chief Executive ofNational Voices.Sophie Corlett: Sophie Corlett, Director of ExternalRelations at Mind.Andrew Harrop: Andrew Harrop, Director of Policyand Public Affairs at Age UK.

Q395 Chair: Thank you very much and thank youfor coming. I would like, if I may, to open thequestioning by referring to the position that we are in,in the relatively short term, in the evolution of healthpolicy. It has been often remarked that there is therequirement within the health service to address whatwe tend to refer to in this Committee as “theNicholson challenge”—the requirement to deliver a4% efficiency gain, compound, over four years, whichis a huge management challenge, alongside thechanges to management structure which are envisagedin the White Paper published in July. I would like toask each of you in turn how you feel that that debateis developing in terms of the impact on patients andthe people with whom you engage, and in particularhow you feel the discussion is developing about thepace at which these changes will be introduced. Therewas some discussion when the White Paper was firstpublished about whether it should be done quicker orslower than the Government envisaged. When SirDavid Nicholson came to the Select Committee acouple of weeks ago, he made it clear that eventswithin PCTs were imposing a pace of change that wasrequiring change to be managed on a very brisktimetable indeed. What is the impact on patients andon the evolution of health policy at a local level? Whowould like to start with that?Katherine Murphy: From the Patients Association’spoint of view and from what we hear from themembers of the public and our own members who callour helpline on a daily basis, this is incrediblyconfusing from a patient’s point of view. The scale ofthe restructure is happening so quickly. It is alreadyhaving an impact on patients because many GPs upand down the country are already getting ready for

Chris SkidmoreDavid TredinnickValerie VazDr Sarah Wollaston

consortia. There are patients who are already beingtold that their operations have been postponed. Indeed,last week we had a call from a senior nurse from thenorth of England who said that over the past threeweeks she had seen five patients who should havebeen referred for pain services but whom she wasunable to refer because she had been told that shecannot refer to the appropriate service. So there isalready an impact on patients. We’ve also heard froma number of patients around the Warwickshire areawho were due to have hip replacements within thenext couple of weeks. They have been postponed andthey haven’t been given a new date for their operation.So it is a concern for patients. Very often, patients andthe public do not understand with health care who isactually responsible for the commissioning of care,and also at the Patients Association we feel that it isunnecessary for patients to have to worry aboutwhether the care is going to be commissioned andwhether they are going to get the appropriate care.

Q396 Chair: What are patients being told when theyare being informed that the care is not available inthe way they expected? To what is that developmentbeing attributed?Katherine Murphy: The senior nurse who contactedus last week felt very, very uncomfortable because shewas given instructions from her PCT that they cannotrefer any more patients—

Q397 Chair: It is being said to be as a result ofa decision by the PCT?Katherine Murphy: The PCT, yes.Jeremy Taylor: I think there is very little publicunderstanding of the Nicholson challenge. I think thepublic debate about health spending presumes thathealth spending is being protected. I am not sure thatthere is a good public debate about the implicationsof having to make very large-scale efficiency savingswhich are supposed to be reinvested in the healthservice. There is a long-term issue and a short-termissue. In the long term, many of our memberorganisations that represent patients from across thespectrum want to see a reconfiguration of the spendingpattern, moving away from spending too much onemergency acute care so that we can spend more ongood care close to home. I think that the direction oftravel has been embraced, but it is going to be difficultto get there. In the short term, we are seeing cuts in

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7 December 2010 Jeremy Taylor, Katherine Murphy, Sophie Corlett and Andrew Harrop

services, most particularly in the area of social care.Many of our member organisations represent peoplewho have both health care and social care needs andit is the impact on local authority spending inparticular which is being felt, although there are alsocuts being felt in the health service, as Katherine wassaying. So pain is being felt now and I think there isa question about how well the process of theefficiency programme is being managed so that itminimises the short-term pain. I think there is also anissue about public understanding.

Q398 Chair: Both those answers paint a picture ofa service where choices are having to be made. Doyou think that has an implication for the choice abouthow quickly these management changes areintroduced?Jeremy Taylor: Unfortunately, I am not an expert onchange management. It seems to me that there are twoschools of thought. One is that, having set in train aseries of organisational changes for the NHS andgiven the need to make efficiency savings, there is aneed to get on and do it as quickly as possible. Thereis also the converse argument, which is that we shoulddo it slowly and in a measured way. One of theconcerns to our membership is a sense that eventshave taken on a momentum of their own, so that somekey parts of the NHS architecture are windingthemselves up and that may not be in the control ofindividuals any more; it may just be happening.I think there is a concern about change getting out ofhand and an uncertainty about where the patient andcitizen voice gets heard in that process. We verystrongly advocate the need for patients, communitiesat local level and the public at large to be activelyinvolved in that debate and in that process of change.Sophie Corlett: You talked about the backdrop, andI would like to widen the backdrop. A lot of peoplewith mental health problems are starting from a pointwhere access to health and social care can be quitehard to get and the quality can be quite poor. For verymany people who are not in work, there is anadditional backdrop of things that they aren’t allnecessarily yet experiencing, even though they arereading in the papers about benefit cuts. For a lot ofpeople who are contacting us, that has created a verydifferent sort of feel about the environment in whichthis change is happening. A lot of people don’t reallyunderstand, except through a feeling that this doesmean that things are going to become worse andthings are being cut. We are already seeing cutshappening at some of our local Mind associationswhich are commissioned to do both health and socialcare. Some of them are already seeing cuts. Somehave been told that they should expect cuts by orbefore next April. There is obviously some impactwhich people are beginning to feel already and whichmay have absolutely nothing to do with NHS reform,but it feels like it is all part of the same package toa lot of individuals.There are two things about speed: one relates toefficiencies and one relates to change. We would liketo see efficiencies involving things that are moreeffective for less money rather than things that are less

effective for less money, and we know that that canbe done in mental health. There has been a lot ofresearch. A very helpful document was published lastweek on productivity in mental health. We know thatthese things can be done, but a lot of them aren’t aboutswitching from one drug to another. They are not thatsimple. They are about reconfiguring how things aredone and training people to do things differently.

Q399 Andrew George: Can you give us an exampleof that at the moment?Sophie Corlett: There is one that would have a reallybig effect, which is fewer people staying fewer daysor nights in acute hospitals. We know that you cansave about £200 million, which would not be a badamount.

Q400 Andrew George: And you would get a betteroutcome, you are saying?Sophie Corlett: You would get a better outcome ona number of levels, because people would beencouraged and supported to recover more quickly.Obviously, the longer you stay in hospital the moreyour ties to your home, your job and your family arecut. Out-of-area placements is another very expensiveissue. Those health economies that have managed todo that have seen real benefit. So it is possible to do,but you obviously have to do such things withforethought and planning. People need to have enoughattention to pay to it to make sure that it happens,which brings us on to NHS reform. We are concernedthat a lot of focus will be put on to the changes, whichmeans that some of these other things, such as how todo efficiency savings well, might be affected. I amsure these things can all be done together, and changeaffords an opportunity to do things differently, but weneed to make sure that that is the result.

Q401 Valerie Vaz: Which is the best body to do thatplanning, when people come out of hospital and gointo their community? Who is doing it now and whois the best person to do it, in your opinion?Sophie Corlett: Where it works best is where youhave a consistent support. At the moment quite oftenwhat happens—it is one of the difficulties—is that youhave support when you are in the community froma community team. You go into hospital and then youare seen by the consultants in the hospital. Then youcome back out and you are seen by the communityconsultant. You need to have some sort of consistencythat plans you through. Crisis resolution and hometreatment teams might be the route of doing that, butI am sure there are lots of different ways of makingsure that it is integrated. Care pathways for peoplewith mental health problems, who are often in thesystem for quite a long period, are quite important andare one of our chief concerns whenever you have anysort of reorganisation.Andrew Harrop: Turning to the Nicholson challengefirst—the £20 billion figure is obviously partly drivenby demographic change and having more people inlate old age—as has already been said, £20 billionsavings can be made through cuts or through realefficiencies. In our view, real efficiencies would meanthat the NHS fundamentally changed how it works

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with older people. At the moment NHScommissioning is not fit for the ageing client groupthat it serves. We have seen very poor improvementsin outcomes for the major health conditions for peopleover 75 compared to other age groups; in relation tothings like cancer, heart disease, stroke and agediscrimination in mental health as well. We arecontinuing to see under-commissioning of essentialcommunity and preventive services that help peoplestay well, stay in their own homes and stay out ofacute care. Such services include audiology,chiropody, osteoporosis care, arthritis care,ophthalmology, incontinence care, depression andfalls prevention services. None of these is glamorous,none of these is life and death, but if you commissionsuch services the whole system benefits and efficiencysavings are driven in acute settings.The NHS is also very bad at dealing with complexneeds where people are in late old age. This appliesto people who are quite close to the end of their lives,likely to be frail, likely to have several things wrongwith them at the same time and quite likely to havemental and physical health problems at the same time.We do not have a geriatric approach to commissioningcare where we look at problems in the round. Linkedto that, we have persistent problems with lack ofintegration between different parts of the health andcare economy—not just the health and social caredivide, which is very important, but also primary,community and acute services not creating pathwaysthat are centred around the person rather than aboutthe health condition. Finally, there is a failure to putdignity and the patient experience really at the heartof everything the health and care economy does.That is the backdrop for health commissioning, butwe believe that on the other side, £20 billion savingscould be achieved if we rethink what the healthservice is there to do for older people. We do haveconsiderable concerns about how that can be achievedat the same time as major structural change, becausea lot of the QIPP agenda is about leadership andcollaboration, about professionals working welltogether. It is concerning that they will, if you like,have to retreat to their professional silos to regrouprather than focus on good relationships within thelocal health community.Chair: I think that’s Sarah Wollaston’s cue.

Q402 Dr Wollaston: We have heard from severalwitnesses that joint commissioning between the healthservice and local authorities does help to achievebetter outcomes and certainly a better integration ofhealth and social care. You touched on that just now,Andrew. Where such arrangements currently exist, asthey do in some places, how do you feel they can bestbe protected during the transition to the newarrangements for commissioning?Andrew Harrop: Good integration is really aboutethos and willpower more than about structure. In myview, it works best when it is about community-basedteams working together rather than about how seniormanagement is structured. I think you can see a majortransition going either way. It could be a period ofinternal turmoil where no one works outwards, or ifthere is the right leadership and steer, it could be

a time for innovation where some of those models thathave been effective in pockets of the country arereally pushed. But for that to happen you would needto see a lot more central leadership in terms of theoutcomes to be expected rather than just the structure.We do have some concerns about the reforms in termsof how local government and the health world will fittogether. The ending of coterminous boundaries,which we only just set up, is a problem. In some areaswhere local combined trusts have started to workreasonably effectively, it will be much harder to makethem work with GP commissioning in the lead. AsI think I have already intimated, the general focusmore on competition and less on collaboration willperhaps make those sorts of problems worse.Integration works best when it is not entirelya market-based set of relationships.There are positives as well. The local government rolewith respect to public health, area-based needsassessment and the ancillary functions of the PCTsthat don’t go to GP commissioning consortia shouldgive the local authority more of a stake in the healtheconomy as well as the care economy, so we hope thatthat will be effective. The launch of the threeoutcomes frameworks, with the intention that they arealigned to each other, is positive. So also are theannouncements this year under the spending reviewof NHS money being spent on social care. Decisionstaken locally about how that’s spent could pushthrough some integration.

Q403 Chair: Does anybody else want to commenton Sarah’s question?Jeremy Taylor: Let me echo Andrew’s point. TheNuffield Trust and others commissioned someresearch on “What are the factors in goodintegration?” The evidence is that good leadership andthe willingness to work together—in other words, thecultural and leadership factors—seem to be moreimportant than the particular technical features,whether they be pooled budgets or other means. So itis the people and their willingness to work that areimportant. I think the principle that should go forwardis, “If it ain’t broke, don’t fix it.” If it is working,please let’s not dismantle arrangements that areworking well.

Q404 Chair: Can I push that a step further—thesame questions we were asking previously—as towhat is the current practical effect on the ground,December 2010, of the process on this kind of jointworking between health and social care?Katherine Murphy: From what we hear on ourhelpline, there are parts of the country wherejoined-up care between health and social care worksvery well. Very often this depends on the priority thatis given. I think individuals need to be more proactivewhen a patient is admitted to hospital. They need tobe looking at the patient as a whole. What is going tohappen to the patient when they are discharged? Dothey have family? Do they live alone? If they aregoing to be discharged into the community, whatsupport do they need—short term and longer term?We need to start thinking now about the support andthe need, rather than leaving it to the eleventh hour.




Q405 Chair: We all know, because we have heard,that that is important. The question really is whetherwe are moving in the direction of strengthening thatkind of outcome or whether there are thosearrangements that currently exist that are felt to beunder threat. Where are we on that balance?Katherine Murphy: I think the opportunity, goingforward, is there. As Andrew said, we must rememberthat we have a much older population. People havecomplex needs. They may not just need health care.They may need health, social care and many otherservices as well, and there are areas of the countrywhere people are working joined up and workingreally, really well. But it’s the services that Andrewdescribed—the chiropody services and the audiologyservices—that have a huge, huge impact on the qualityof life for an individual. I heard quite recently abouta person who was in hospital, they were havingproblems getting their hearing aid battery replaced andthe nurse on the ward couldn’t make a referral to theaudiology department. There are systems that areabsolutely ludicrous within the NHS.

Q406 Rosie Cooper: I was just wondering why youwould need a referral. Why couldn’t somebody justgo and get a battery? This is where these things justleave me cold. Why do we have to have a process?Katherine Murphy: And that was an elderly patientwho had to be taken out of the hospital across toanother building so that they could actually get thebattery for the hearing aid.

Rosie Cooper: Sack the chief executive, whoever itis, and just start again.

Q407 Dr Wollaston: It’s because everything iscosted. As you were saying, a lot of it is about thepeople and having somebody who is there at the topsaying that you are going to use common sense ratherthan restructure.Katherine Murphy: Yes.

Q408 Valerie Vaz: How do you see that changing?Katherine Murphy: We all say it time and time againin the third sector, but it’s about having effectiveleadership that will challenge decisions like this veryexample I have just given you, which is absolutelyridiculous.

Q409 Valerie Vaz: Do you see that happening withthe reforms?Katherine Murphy: If we are going to focus on theoutcome of the patient and the experience of thepatient, then I think there is an opportunity to correctthis; yes, I do see this happening.

Q410 Rosie Cooper: Can I just come back to takethe particular example you have outlined about thehearing aid? What actually happened?Katherine Murphy: The relative had to take thepatient out of the hospital to another building to thehearing aid department to get a battery.

Q411 Rosie Cooper: Did that come to you before orafter and were you able to intervene? I’m trying to geta feel for this.Katherine Murphy: It’s very difficult for the PatientsAssociation to intervene with every single inquiry thatwe receive on our helpline. If we intervened with allthe inquiries we just wouldn’t be able to cope, to bequite honest, because we have limited resources. Wesign-posted; we told the relative who was calling fromthe hospital on her mobile phone to go and speak tothe ward manager. The ward manager, the ward sister,said there was absolutely nothing she could do aboutit. Eventually that evening they got a referral from thejunior doctor on the ward.

Q412 Rosie Cooper: Forgive me, and I am notoverloading you with it, but I am trying to work myway through a fog. In this example, you have got astupid situation. The person here who suffered was thepatient. Why, perhaps, could not the PatientsAssociation, or whoever, ring the hospital chief execor write pointing out what’s going on because therewill be several other patients tomorrow and the dayafter?Katherine Murphy: We did ring the chief executive.The chief executive or his deputy were not available.

Q413 David Tredinnick: Was it technicallychallenging to change the battery? Was it screwed in?Was it a specialist battery? Was there any reason forthis?Rosie Cooper: 1, 2, 3, 4, 5, 6, out it comes. Thereyou go—dead hard.

Q414 Dr Wollaston: Could the patient notsometimes get their own batteries?David Tredinnick: I rest my case.Andrew Harrop: Can I broaden the point to whatI said earlier about person-centred care? If everyonein the NHS and social care was empowered to thinkabout the person and work with other professionals ina sideways way, sometimes bringing in a specialist inolder people’s care where there were particularcomplex issues, so they were trying to wrap up all thesupport that an individual needs rather than taking thisvery condition-focused perspective—

Q415 Rosie Cooper: Forgive me, I am an old personmyself but it’s not about old age. It is about commonsense. It is applying care. It is just doing for yourpatient, or whatever, that which you would do for yourmum, brother, sister or whatever. I don’t get it. I don’tknow how that could happen. It wouldn’t happen inmy hospital.Katherine Murphy: But very often it’s the doing thatdoesn’t happen with regards to the care of the patient.I don’t know if you saw, but we published a reportlast week about appalling standards of care in hospitaland these are the very issues that patients, day in dayout, unfortunately don’t get addressed, because thebigger picture gets much more priority than thepatient’s needs.Chair: I think we have probably spent long enoughon the battery.




Q416 Yvonne Fovargue: I want to move to theopportunity for the voluntary sector to offercommissioning support to GP consortia. How muchopportunity do you think there is for the voluntarysector in offering this support? Have you got anyexamples of where it is working at the moment? Whatbarriers do you think there are at the moment and howdo you think this will either improve or not improveunder this new regime?Jeremy Taylor: I think there are opportunities for thevoluntary sector to be involved in commissioning inone way or another. Let me give a couple of examplesof voluntary sector contributions to the design anddelivery of services. One is Diabetes UK in itsparticipation in the Year of Care programme, which isabout an integrated approach to helping peoplemanage their diabetes more successfully. It leads tobetter quality of care and reduced costs for the NHS.Another example would be the NeurologicalCommissioning Support programme, which I believeMind is involved in. Am I right? Maybe not.Sophie Corlett: I don’t know.1

Jeremy Taylor: It is Parkinson’s UK and a number ofother charities together providing support tocommissioners on neurological conditions. So thereare examples of the voluntary sector being involvednow. Does the reform of commissioning arrangementsprovide new opportunities for the voluntary sector?Absolutely.What are the obstacles? They are the willingness ofthe new commissioning consortia to engage with thevoluntary sector, to understand its potentialcontribution and, I think, a degree of confusion aboutwhere the consortia may go for their support to docommissioning. At the moment, the situation seemsquite fluid. Some of the consortia are getting togetherand preparing to become pathfinder consortia, as weunderstand. Lots of people are beating a path to thedoors of the emerging consortia to say, “We canprovide commissioning support.” So I think there isa real issue about how the emerging consortia arehelped to navigate their way through what could bea very confusing array of people trying to sell andoffer them support. The contribution of the voluntarysector is already apparent and it is an opportunity.Alongside that, just to echo the point that Katherinehas made, the voluntary sector is in a strong positionbecause there are huge opportunities. The demandson many of our organisations within our membership,which are both service providers as well as sometimesproviding support for commissioning, are growing butthere is a real issue about funding. The tragedy wouldbe if short-term funding pressures meant that thefantastic contribution that the voluntary sector canmake—that potential—was not realised.Sophie Corlett: Our local groups are already involvedin quite a number of areas with commissioning,mostly on an unpaid basis. There is a lot of freeadvice. The particular strengths of this approach arethat, because a lot of our local groups are very locallyengaged, their trustee boards are local people and theyare having people come in every day who arespending a bit of time doing different sorts of things.We are very often involved with people in their1 Note by witness: Mind is not part of this initiative

communities rather than just with people—as a GPwould see them—popping in specifically about theirhealth. We are involved quite widely in people’s lives,which gives us a different angle on the individualswhom we are working with.Another really important strength that we wouldn’twant to see lost in the transition is that some thirdsector organisations can have contact with groups thatGPs have very little contact with: people who are lesslikely to be registered with their GP, from BMEgroups, homeless people, a wide range of people thatGPs will have to get to grips with if they are going tobe commissioning services on their behalf. Those arethe benefits.I think that for us one of the risks is that that freeadvice will be expected now to be provided to a lotmore people because, potentially, we may have manymore consortia than we had PCTs. Such advice mightbe needed more because of GPs’ potential difficultiesin that they have less of a geographical spread forpeople that aren’t registered with them. They haveclose relationships with people whom they see andthen no relationship at all with the rest. But also thereis a concern for us about delivery. We have a goodunderstanding of these groups because we work withthem and we provide services with them. If providingadvice to the commissioning process means that wecannot provide those services because that would bea conflict of interest, there will be a real difficulty. Sothere needs to be a way of ensuring that that expertiseis garnered and paid for without it necessarilypreventing us from providing the service that gives usthe expertise that we can offer.

Q417 Chair: Is there not also a question about howthis is being done in the transitional phase? Youdescribe what might be the position in two or threeyears’ time. What is happening about next year?Sophie Corlett: We have not had any informationabout that. It is possible that some of our local Mindassociations are engaged locally, but it’s a verydifferent picture across the country. Some primarycare trusts’ relationships with local groups that theyare commissioning at the moment have been moreabout sending messages that they are not going tohave any money next year, or that they have got tocut by 5%, rather than engaging them in any processesthat they are developing with GP consortia.

Q418 Yvonne Fovargue: What concerns me is thefact that some GPs will have an understanding of whatthe voluntary sector does and other GPs will not haveany understanding at all.Andrew Harrop: We’ve just had an example of that inCumbria where we have two of our local Age Concernpartners in adjoining areas. One has just struck up anexcellent relationship with their practice-basedcommissioning GPs and the neighbouring area can’tget in at all.

Q419 Yvonne Fovargue: The patchiness of theprovision is what concerns me. It becomes more of apostcode lottery, would you say?




Jeremy Taylor: One of the things that we hope to seeis a clear steer and guidance from the emergingNational Commissioning Board—indeed, I think thatprofessional organisations such as the royal collegeshave a role to play too—in setting out some very clearprinciples and simple steps that the emergingconsortia need to be thinking about as they start toengage with how we understand the needs that weneed to serve in our local areas. Who are the peoplewe need to be involving in the design of carepathways? Who are the people who need to beproviding the services? There is a whole set ofquestions that the consortia, the commissioners, needto be asking themselves. As an integral part of thosequestions, where do we get our expertise? How do weunderstand the needs and experience of local patientsand communities and how can we build that in to whatwe are trying to do?Katherine Murphy: One of the things that the PatientsAssociation has been actively involved in over thepast year is a network of other patient groups. Wehave about 40 other patient organisations and we dida joint manifesto just before the election. One of thethings we asked for is that it is the duty of every GP,when a diagnosis is confirmed, to refer that patient tothe disease-specific organisation. We have written tothe Secretary of State and to the Royal College ofGeneral Practitioners. This is something that we willbe proactively campaigning for.

Q420 Valerie Vaz: I can’t get a grip of the WhitePaper and I am not quite sure how you will be able todo your work with the lack of coterminosity and alsothe fact that patients can choose which GP they go to.I don’t know, but is it possible that someone living inCumbria could choose a GP somewhere else? Is thatwhat your patients want? How are you going to doyour work under the new regime? How do you do itnow and how do you do it under the new regime?Katherine Murphy: There is a huge unrecogniseddemand on the third sector. It is very, very difficultbecause the public’s perception is obviously that weare there to provide a service, but we are all strugglingwith very limited resources. We have a huge plan inthe White Paper, and absolutely fantasticopportunities, but we are racing, racing, racing aheadand it is very confusing and very disturbing forpatients. Obviously none of us knows yet what thereal impact is going to be. If choice is to be choiceand it is to be everything that it is made out to be,then there is still a long way to go for patients toreceive choice as we see choice—choice around theirGP, their hospital and their healthcare professionals.At this moment in time patients don’t have anyinformation on which to base that choice. I know weare at the start of an information revolution, but anawful lot of change is happening very quickly.Chair: Rosie wanted to come in specifically on that.

Q421 Rosie Cooper: I know choice is difficult butI would rather, even if it was flawed, that we movedto a point at which patients do really get a choice, andyou can hear that I mean a real choice. We are on thatjourney—maybe very early on.

Talking about boundaries and potential benefits forpatients choosing their doctor—ergo in this new worldchoosing essentially their commissioner, so theyalmost decide how they will be treated,—in this bravenew world do you think there is a risk that if the moreable patients exercised that choice you would end upwith sink practices in parts of the country?Katherine Murphy: It is difficult because there willobviously be some patients and members of the publicwho will exercise that genuine choice and will wantto register, maybe just for the sake of convenience,with a GP next to where they work if they travela long way to work, and that is a welcome move. Butthere will still be the vast number of patients whowon’t because the whole ethos is around therelationship that you have with your GP or therelationship that your family will have with the GP;the GP will be very aware of the history of the wholefamily. I think there will be some GP surgeries thatmay be treating an elderly population, and probablySophie would be better able to answer this. Many ofthe people within that population may suffer mentalhealth problems. The GP there may just be rewritingthe prescriptions and not being more creative, beingmore innovative, referring patients to others.

Q422 Rosie Cooper: If you had almost a sinkpractice where the population that attended or thepatient list had complex needs, perhaps mental healthneeds or elderly majoring on chronic conditions, howwould you address that in this new world?Katherine Murphy: It depends how involved and howengaged the actual patients are, how much they knowabout the health services in their community and howmuch they have been engaged in the wholedevelopment of the health services within thecommunity.

Q423 Rosie Cooper: But they would have gone offand chosen somewhere else in this new world. Howdo you think that the new system would help apractice which would be finding it difficult?Katherine Murphy: Only if you have an engaged andan involved patient or member of the public, and alsoan engaged and an involved doctor as well. If youdon’t have the GP who is willing to be creative,I mean that’s—

Q424 Chair: Do you want to come in on thissubject?Jeremy Taylor: Choice is important. Control is evenmore important, and the evidence that we have seensuggests that what people really want is high qualityservices everywhere and good access to thoseservices. They also want to be genuinely involved inthe treatment process. Choice becomes incrediblymeaningful where you are given proper informedchoices about treatment options and the ability toshare in the decisions about your care, particularly ifyou have a long-term condition. The whole businessaround a proper care plan for long-term conditions,shared decision making and being involved inunderstanding the options for treatment is really,really important. The evidence suggests that peoplereally value that.




The choice of provider—the GP—is less valued, butis likely to become more valued as greater informationgoes into the public domain about variations inquality. I think we have to recognise that as long asthere is variation in quality, which there is, and thatbecomes more transparent and obvious to the public,which it will do, then people need to have the abilityto exercise choice. Are we going to see a mass exodusfrom one GP practice to another as a result of choice?Probably not. The factors that make people want tostay with their local practice are very strong, but wewill see some increase in movement. Is there a dangerof empowering the already articulate and empoweredat the expense of the more disadvantaged? Yes. Thatis one of the risks that we have pointed out in theWhite Paper reforms. It is really important thateverybody has the opportunity to make informedchoices and some people—the most vulnerable, themost disadvantaged—are going to need extra supportand help to make those choices.There is also an issue about whether we have gooddoctoring in all places, and we know that we don’t.We know that disadvantaged areas are under-doctoredand that primary care is less developed and less wellresourced. That is an issue that needs to be addressedso that we have greater equity of provision.

Q425 Rosie Cooper: How do you think this newsystem would help address that, or not, as the casemay be?Jeremy Taylor: I think there are many elements in thesystem, just to come back to the question that Valerieasked about what’s our job and what are we seekingto do. National Voices is a coalition of health andsocial care national charities and our mission is toempower the patient and citizen voice in health andsocial care. One of the things we have always seen asan important thing to do is to try and ensure that thereality matches the rhetoric in health care, and thatwas one of the things we said when we came intoexistence two years ago. Under the new Government’sproposals, the rhetoric, the vision, about patientempowerment is really quite exciting, but the issue isstill how you make a reality of that.

Q426 Rosie Cooper: Do you think a wellbeing boardis exciting? It puts me to sleep.Jeremy Taylor: I don’t want to sound too geeky but Ithink health and wellbeing boards—

Q427 Rosie Cooper: No, no, the idea of a Health andWellbeing Board is—Jeremy Taylor: I think that it is a very good idea—

Q428 Rosie Cooper: Being disfranchised from theactual decision making makes it a bit boring, if youcan’t influence anything, if you are not at the tablewith a vote.Jeremy Taylor: I think health and wellbeing boards,as a forum bringing together the key decision makersabout health and social care and public health in oneplace, are a good idea.

Q429 Rosie Cooper: But you make the decisionssomewhere else.Jeremy Taylor: Are ordinary citizens, patients andtheir representatives going to have a seat at the table?They should do, otherwise it won’t work.

Q430 Rosie Cooper: But they are not. I am not reallysure I am that clear yet how the wellbeing boards arestructured, but they certainly won’t have a place onthe National Commissioning Board. Therefore, theywon’t be where the decisions are going to be made,and the Secretary of State has made that clear.Jeremy Taylor: We think health and wellbeing boardshave the potential to be quite important, alongsidea number of other things which the Government hasproposed. I think a stronger role for local authoritiesin overseeing the integration of commissioning inpublic health is likely to be a good thing.HealthWatch, if it turns out to be a powerful consumerchampion at local level—Rosie Cooper: The big word there being “if”.Chair: Rosie, can we interpose in the dialogue?Andrew Harrop: To come in on that, I think the pointyou are making is that GP consortia themselves won’thave robust involvement requirements, including nothaving lay people on their boards. We think thatshould change. We are also concerned whether theNHS Commissioning Board will have, at nationallevel, enough engagement mechanisms. However,involvement isn’t everything. It is also very importantthat the consortia and the board itself are robustlyintervening where they think there is a problem withlocal practices. The White Paper is a bit ambiguousabout whose role it is. You are going to have all thisnational machinery from the board, things like anextension of the QOF that we had today but withoutthe sort of performance management that hastraditionally gone with it. Then you are going to havepeer-to-peer support from GP consortia, with GPstalking to each other, which might be good, but itmight be a bit cosy with regard to challenging theweak performers in that patch.You asked about a drain-of-resources problem, withvery disadvantaged groups all clustered together. Theway of avoiding that is avoiding consortia being toosmall so that at least you will have a pooling ofresources between practices into a large enoughbudget so that they can collectively commissionacross a fairly wide population group.Chair: We have quite a long agenda. DavidTredinnick wants to come in on HealthWatch andpatient representation.

Q431 David Tredinnick: It was interesting hearingwhat you were saying in answer to Rosie Cooper, butjust looking at HealthWatch and patient choice, howsatisfied are you with the proposed arrangements forpatient and public involvement in the new NHScommissioning system generally? Could you just saya few words on that?Jeremy Taylor: We have identified some potentialgaps in the arrangements as set out in theGovernment’s papers. National Voices has alsoadvocated, alongside Age UK, the need for the GPconsortia to have strong lay involvement. We think




that’s important. They need to have a duty to involveand engage patients and local communities in theirdecisions. We wait to see whether that will bereflected in the coming Health Bill. We think thatHealthWatch is potentially a very powerfulmechanism for improving the support of individualpatients and the representation of communities inhealth commissioning decisions at local level, butI think the devil is in the detail. We have advocatedwell-resourced HealthWatches, with a good mix ofprofessional paid staff and volunteers with very strongconnections into their local communities andorganisations that will be seen as key partners in thelocal health economy.

Q432 David Tredinnick: I was interested in youropening remarks when you mentioned that patientswant less spent on acute services and they want, byimplication, more on prevention, I imagine. If youlook at the Health White Paper that came out lastweek, Healthy lives, healthy people, and theGovernment’s key policy “Starting well, through earlyintervention and prevention”, what I am interested inis: to what extent are patients going to be empoweredto have the choice they want? To what extent are theygoing to be guided or obstructed from having whatthey want? I have been a chair of the IntegratedHealthcare Group here for many years and we are justabout to have statutory regulation of practitioners ofChinese medicine and acupuncture. They can solve allthe problems that Andrew Harrop listed for theelderly. Depression and osteoporosis—all thesethings—can be helped by people who have thosedisciplines. The public are demanding this. A massivenumber of people out there want to use homeopathicmedicines rather than stronger drugs. Who is thegatekeeper going to be? How are we going to decidethe degree to which patients have choice andprofessionals have choice?

Q433 Chair: If David will forgive me, could weanswer the question on the general issue of choicerather than the specifics around the natural medicinesbecause I think that is probably the major issue thatallows you the way in?David Tredinnick: Of course, Chair.Sophie Corlett: I wanted to add a quick thing aboutHealthWatch, but also speak about the issue of choiceand who makes it. For us, transparency andengagement aren’t necessarily going to be sufficient.There are a lot of people who, if they saw what wasspent on health, would say, “We want to spend moremoney here”—I won’t mention what those areas arebut I think you might guess what they are—“and lessmoney here”. That second “here” would be mentalhealth, because, as a general rule, people don’t valuetheir own mental health, let alone anybody else’smental health. We know that people with severe andenduring mental health problems are not a group thatthe public broadly smile upon and want to support.That has been our experience across health. That isour experience when clinicians and planners areinvolved, and I think there is a risk that the public willrepeat that. We are very concerned that HealthWatchand clinicians have a very clear policy direction to

look at what adds quality to life and improves healthoverall, guided by things that we now know.

Q434 David Tredinnick: I want to pursue thisfurther. Should patients, service users and the publicbe directly represented on the boards of GP consortiaand the NHS Commissioning Board?Sophie Corlett: I think it would be helpful, yes. It’sgreat that we have moved it from bureaucrats toclinicians, but patients are really the people that arethe recipients of health and should be involved.

Q435 David Tredinnick: How informed is a patientin making a decision? Are we saying that they can goon the board? Do we have any patients with any beefthat can go on these boards then?Sophie Corlett: I think that is one of the concerns thatyou are likely to have with people that go on boards,and a lot of the people that don’t go on boards are theones most in need of services.Katherine Murphy: Very often now the people whosit on many of the boards are just the same people thatmove around from one committee to another. I think itis really, really important to have lay representationand that that is genuinely lay representation and notsomebody who is picked or selected because theywon’t ask the questions that should be asked and theywill say exactly what should be said. So I think weneed genuine lay representation.Jeremy Taylor: There are many people in localcommunities who are prepared to play a constructivelay person role. There is no shortage of people.A good example is the Patients’ Council inManchester, which is an organisation of over 20,000volunteers who get involved in local health decisionmaking. Their approach is to encourage people tocome forward based on their own experiences andinterest in health, but they also provide training andsupport to enable those people to play a constructiverole outside the immediate area of their personalexperience. There is an issue of identifying where thevolunteers are, encouraging them to come forward—and that could be a role for HealthWatch—but alsoproviding training and support to enable people to dowhat can be a very difficult job, to deal with a lot ofvery professional people who are doing a full-time jobin healthcare. As a volunteer lay person, it isn’t easyand one of the things we haven’t been good at isproviding training and support to enable people to dothat well. But I don’t think we should fall into the trapof thinking that, therefore, we shouldn’t do it becausethere isn’t a big enough pool of people out there.I think there is.Andrew Harrop: It’s really about horses for courses.There is a role for skilled, non-executive oversight butit’s not the same as broad, inclusive engagementreaching the parts of the community that havetraditionally been overlooked—people who arehousebound, people from different minority groups.You’ve got to do it all and it’s really about an ethosand an expectation that commissioners will engage allparts of the public.We have done polling on this and very large numbersof people over 65 do want to get involved but mostly




in a fairly light-touch way, through surveys andfeedback forms. Then there is, as we’ve heard,a minority who are prepared to become activevolunteers and to sit on committees. But we shouldn’tsee that as the only way of getting a broad perspectiveof patients’ views and expectations.

Q436 David Tredinnick: I have two last questions.I think there is a mismatch between what the generalpublic want, general patients want, and whatpractitioners are offering. This is the key issue to bebridged because I think that the general public—a lotof patients—want less invasive medicine if they canget it and I think there is resistance to that. You cancomment on that if you like, but my last question inthis series is this. HealthWatch is going to be formedout of local involvement networks—LINks. Are youconfident, given the experience of LINks, thatHealthWatch will be effective, because there wascriticism of LINks?Andrew Harrop: LINks have been very widelycriticised. The worst example is probably in the MidStaffs inquiry where the local LINks was seen astotally dysfunctional. We must not have this as justa rebadging of institutions that in many parts of thecountry aren’t working well, although there is alsogood practice. I would say it shouldn’t just be abouthearing and gathering voices and views but ensuringthat the new HealthWatches are monitoring, lookingat the data, benchmarking services in a healthinformation-revolution way; and also we have heardabout a role for them doing casework and advocacy,which I don’t think the LINks are doing sufficientlynow. If you focus on casework and oversight ratherthan just an engagement route, then new bodies canbe more effective.

Q437 Chair: Does anyone else want to comment onthat?Jeremy Taylor: Yes. The area of public involvementin local healthcare has been subject to too much flux.The community health councils, which many peoplethought were a fairly good model that was probablycapable of improvement but could be built on, werescrapped and replaced by patient forums, which werein turn scrapped after a very short time and replacedby LINks. They have only been in existence for threeyears and they’ve taken a number of years to getgoing. In a way, it’s not surprising that LINks havenot been seen as a success. I think that they have beentoo easily dismissed, and it is slightly unfair becausethey have needed to get going—some are better thanothers—and they haven’t had very long. I think the—

Q438 David Tredinnick: Forgive me for interruptingyou, but didn’t you say earlier on that, effectively, “Ifit ain’t broke, don’t fix it”, and that you didn’t reallywant to see change unless it was essential?Jeremy Taylor: Yes. There is merit in the argumentthat says, “Don’t scrap the system yet again and createsomething completely new. Let’s build on the LINks.”I think that argument has force, but Andrew is right.The set of functions proposed for HealthWatch is quiteradically different from that of the current LINks.They are going to be asked to do a lot more and if

they are well resourced and well organised they willachieve a lot more. I think the consequence is that itmay be misleading to think of HealthWatch as beingsomething that’s built on LINks. It will probably bebuilt on many of the people who are currentlyinvolved in LINks as volunteers but will need to bringin more people as well and have more support andmore infrastructure. I think we shouldn’t feel that weare tied into the current infrastructure.

Q439 Rosie Cooper: Let me make a very quickgeneral jump in. It’s going to be an independent armof the CQC while being funded by the local authority.Do you think that really can work?Jeremy Taylor: The proposal is for a nationalHealthWatch—HealthWatch England—that sits as anindependent part of the CQC and local HealthWatcheswhich are commissioned by local authorities.

Q440 Rosie Cooper: And funded.Jeremy Taylor: I think it remains to be seen how wellthat’s going to work.Katherine Murphy: With HealthWatch, again there isa golden opportunity for a national voice for patients,but obviously it depends on how much resource isgoing to be put into the system, how good therecruiting is, how much time, how much priority, theskills that people would have on each of theHealthWatch forums and also what they are going tobe asked to do. I think it is really important, now weare looking at something completely different toLINks, that HealthWatch will be much more aboutmonitoring patient services. Hopefully we will havethe right people in hospitals asking people about theirexperiences and people from HealthWatch turning upat GP surgeries asking about their experience aroundtheir care with the GP. It will be much more out there,monitoring and benchmarking services, which isreally, really important.

Q441 Chris Skidmore: I would like to return to theissue of vulnerable groups, which has been touchedupon throughout this evidence session and is a crucialpart of the White Paper in respect of reforms tocommissioning. It’s one of shared decision making;“No decision about me without me”. Yet we knowthat for mental health services, for an ageingpopulation with increasing levels of dementia, thisapproach is going to be difficult because it relies onpatients being able to access, understand and analysethe information, and that simply may not be possible.At the same time, a survey of 250 GPs by Rethinkfound that only 31% feel confident enough toeffectively commission mental health services. I waswondering if you would give your thoughts abouthanding commissioning powers over to GPs. Wouldthis possibly be detrimental to commissioning formental health services or for dementia services?Sophie Corlett: There is no doubt that mental healthcommissioning is very complicated; PCTs havestruggled with it and are getting a little bit better at it,but it’s a difficult thing to do. People stay in servicesfor many years, often for the remainder of their lives,and they go through a lot of different stages andphases of need. It’s a complicated thing and certainly




we are concerned that any sort of shift, when PCTsare beginning to get to grips with it, could beproblematic. GPs are in many ways well placed toknow what people with mental health problems need.The majority of people with mental health problemsdon’t go into secondary care; they are dealt withentirely within primary care. But we do hear from GPsthat they are not confident, and I think that’s right,and we hear from a lot of our contacts, people whouse mental health services, that although some GPsare good, some are not and have no understanding ofwhat they need even in primary care. We also hearfrom GPs and from individuals that they have lessunderstanding of what happens when they are insecondary care and what their needs are. So there area number of concerns about whether they cancommission well, about how they will commissionsecondary services and particularly about people withsevere and enduring or more rare and severeconditions. So there is a broad concern there. I don’tthink it is insoluble, but there is certainly a need forgreater understanding in training and support incommissioning.

Q442 Chris Skidmore: You mentioned the PCTsgetting to grips with the issue of mental healthservices commissioning. Is there a risk that the paceof change at the moment with the dismantling of PCTsis going to allow this to fall apart? Do you feel thatthe overlap will not actually take place?Sophie Corlett: Yes, there is absolutely a risk. One ofthe good things is that a lot of people who GPs seeevery day will have mental health problems. Eitherthat is what they are seeing the GP for or it is behindwhat they are seeing the GP for. We would beencouraged to feel that GPs would have their eye onthis. Nevertheless, it’s not the majority amount ofmoney that is spent. So, obviously, when you arehaving to deal with a mass of commissioningresponsibilities that are coming over to you, howmuch focus are you going to be able to give to eacharea? If you are worried about what your local paperis going to be making a scandal of if you get it wrong,what if mental health is not going to be the one? Thereare a number of factors which may militate againstGPs getting to grips with this as well as they might,from their own understanding to the pressures of theprocess.I wanted to add another point about the individualdecisions, and about individuals with mental healthproblems and how they engage with the process. Weare concerned about the assumption that transparencyand choice will deliver for individuals. For very manyindividuals with mental health problems, their abilityto engage in that process will be reduced or indeedtaken away from them because they are beingcompulsorily treated. Having the support through theprocess of advocate, navigator and somebody who cansupport them when they are not well is reallyimportant.Jeremy Taylor: Can I just add that many of the pointsthat Sophie has made in relation to mental healthapply to other groups?Sophie Corlett: Yes, absolutely.

Jeremy Taylor: Anybody who is not on the radar ofthe GP potentially loses out in a system of GPcommissioning unless proper safeguards areintroduced. We have discussed a number of themalready in the course of this session, so it is partlyabout having the support and navigation for peoplewho are more vulnerable. It is about working withthird sector organisations that specialise in advocatingfor chronically excluded groups or other particulargroups with needs. I would add that people withdementia, people with learning disabilities,chronically excluded groups and a number of BMEcommunities suffer the same kinds of problems. It isabout working with the organisations that specialise.It’s about having the right size of consortia. It’s aboutthe integration of health and social care.

Q443 Chris Skidmore: Can I comment on a separateinterest point here? Mr Harrop, you mentioned as wellthe size of the consortia is quite a crucial aspect here.In previous evidence sessions we’ve heard estimatesranging from between about 30,000 up to about550,000, but at the moment, at the last session wetook, round about 100,000 has been talked about asbeing the ideal size. I would be interested to see whatyou thought, in terms of mental health services whichneed to be commissioned over a wider area or to havea core critical mass for commissioning supportservices. What would you see as being an ideal sizefor a consortia?Andrew Harrop: I think the issue we are driving atwith this question is: do the GPs involved have thenecessary sort of commissioning skills? Clearly, if youhave enough practices grouped together, some ofthose GPs will more or less become commissioners. Ifyou don’t have enough in the consortia, that becomesharder. When we have talked to older people, they arein favour of GPs being more involved incommissioning but they are worried about them beingtaken away from their current frontline duties. It isimportant that those GPs who are going to buildspeciality in commissioning and in understandinga wide range of conditions that they perhaps haven’tworked with in their own practice, doing that well.We know that, today, all GPs see people in late oldage but only 40% of them have any postgraduatequalification in older people’s care, and I’m sure it’strue of other areas of treatment. So it’s not just about,if you like, the frontline GP skills.I would add that this is also about engagement withthe whole clinical community. One of the issues ismaking sure that, although the buck stops with the GPcommissioner, there is a culture of collaboration withphysicians in acute care and with all the communityservices so that everyone is involved in defining whatthe needs of the community are, redesigning pathwaysand thinking about the reconfiguration of services. Ifthat is seen as the responsibility of the GPcommissioners only, in a market context, rather thana collaborative context, I think it will be difficult todrive through change and identify where differentclient groups are being failed by the local healtheconomy.Chair: I am conscious that we have another group ofwitnesses due to start in three minutes. Nadine wants




to ask some questions about specialisedcommissioning and Valerie wants to ask somequestions on conflicts of interest. Could we go toNadine first?

Q444 Nadine Dorries: We have heard thatspecialised services are going to be commissioned bythe NHS Commissioning Board and a number ofgroups have welcomed this but some have felt it willlead to poorer commissioning. What is your opinionon this? Would anybody like to start?Jeremy Taylor: Some conditions need to becommissioned for at a national level. That’s true nowand needs to be true in the new arrangements. I thinkthere’s also an issue about what needs to be done ata regional level, both in terms of conditions and interms of configuration of services. For example, withthe work that has recently been going on acrossLondon to reconfigure some acute services,particularly stroke, there is a question as to how thatsort of regional cross-local decision making abouta larger health economy gets done under a systemwith GP consortia. We don’t yet know, but there needsto be some mechanism for being able to take decisionson a larger than just local level, however you define“local”.There are a number of conditions—this comes backto the answer to the previous question—which areprobably not amenable to national commissioningarrangements but where there seems to be a persistenttendency to neglect the needs of people with thoseconditions. For example, osteoarthritis is a conditionthat doesn’t seem to be adequately catered for. MEwould be another one and there are a number of rareand orphaned conditions, some of which do havenational specialist commissioning arrangements, someof which don’t because there is no recognisedtreatment for them. Actually the issue there is aboutresearch to enable cures and treatments to be found.There is a whole set of issues. For us it’s about beingclear what needs to be done at a national level, whatneeds to be done at a supra-local level, what generallyneeds to be done at a local level and what supportis given to the commissioners to be able do that jobeffectively, taking full account of the assessed needand the views and experiences of patients.Sophie Corlett: To add to that, I think the regionallevel issue is key for us. We are aware that for somepeople with particular conditions the necessarycommissioning is going to be quite difficult if the GPconsortia turn out to be very small.

Q445 Nadine Dorries: On that very point—Sophie Corlett: Having some sort of opportunity forregional commissioning or for consortia to worktogether, or a requirement for consortia to worktogether, I am not quite sure what the answer wouldbe but there needs to be something that makes senseof that.Andrew Harrop: Even if not commissioning, drivinginnovation and good practice with clinical networksworking together is essential to achieve some of thechanges that won’t happen just by the signals beingsent out by commissioners.

Katherine Murphy: I would also say that this is onearea of the White Paper where there needs to be muchmore clarity. My understanding is that some consortiawill be able to commission the services themselves,even specialised services. I think again it’s an areathat needs a lot more clarity. What happens if youhave got an individual patient with one of the rarerconditions? What happens to that individual patient?It might just be one patient registered with the GP.How will the services for individuals like that becommissioned and where do they fall into?

Q446 Nadine Dorries: That leads into the secondquestion. For those patients with specialised needs, theNHS Commissioning Board will be commissioningprimary care services. How effective do you think thatwill be, particularly in under-doctored areas?Sophie Corlett: That is a very interesting question,because obviously PCTs have struggled with that. Ifthe National Commissioning Board can solve it, thatwould be wonderful. We have a concern about peoplewho need to register with their local doctor, and listsmight become full because they live in the inner city,which is where people work and they want to registerthere, which goes back to that question of choice ofGP again. But I think there is an issue, particularly incity areas where GPs don’t necessarily stay longbecause what individuals want, particularly if theyhave a mental health problem, is a long-termrelationship with one good GP. They do want to beable to choose so that they can say, “He’s not good.She’s better. I’ll go to her.” But, again, you want thatto be sufficiently local and available. If thecommissioning board can solve that, obviously, that’sall good, but I am not sure that we have seenmechanisms that address those issues yet.Andrew Harrop: The under-doctoring issue we areconcerned about is primary care in care homes, whichis a disgrace. What we would like to see is the nationalboard send down a very clear direction that allconsortia must put in place adequate arrangements forprimary care in care homes. At the moment it isa dog’s breakfast.Katherine Murphy: I would echo that.

Q447 Nadine Dorries: Again, on those particularareas, Katherine, you were saying before thatsometimes it’s the more minor consideration whichcauses the greatest distress to a patient, such aschiropody, nails and hearing aid batteries. How do youthink that will work with the NHS CommissioningBoard commissioning those services like dentistry andaudiology on behalf of those patients? Do you thinkthat will be able to work? Do you see problems there?Andrew Harrop: It is a bit of a split. Pharmacy,dentistry and ophthalmology will be national andother community services will be local, so it will bedifficult to navigate your way through the system. Thekey issue is really strong leadership from the board,both in terms of what it is directly commissioning andgiving a strong steer to what is effective, particularlyin terms of preventive and community services, andgetting resources out of acute care, which we startedoff talking about. The national board has got to leadthat process very directively. We would suggest, as




Age UK, that it should be doing a major piece of workon the ageing of NHS users to help the whole systemprepare in a way that it isn’t at the moment.

Q448 Valerie Vaz: We don’t know if the NationalCommissioning Board is going to do that kind ofwork, do we?Andrew Harrop: No, we don’t.

Q449 Valerie Vaz: So there’s a bit of flux at theminute. I wanted to turn finally to the conflicts ofinterests that a couple of you have touched on betweenthe consortia and this introduction of “any willingprovider”. How do you see that for your users and,with the introduction of for-profit organisationscompeting with you, how do you see the integratedcare working for your users?Sophie Corlett: I think we have quite a lot of concernabout fragmentation of services. Somebody witha mental health problem might be in services fora number of years and in and out of different sorts ofservices. We were talking before about productivity interms of getting people in and out of hospital ona question that you asked there, but people need tohave a consistency of contact with somebody. If theyare going in and out of services which aren’t evenprovided in the same sort of culture and way, thenthey are seeing consultants in one service and they arebeing discharged from that; they are going intoanother and they are being discharged from that. TheirGP might be a locum or be changing or they might bein a group practice and not seeing the same one. Withregard to consistency of services, who is ensuring thatthat person is on a pathway that leads to recovery asopposed to a pathway that just maintains them withinthe system? At the moment, within mental health,there are far too many who are in the latter pathwayalready, and we are looking across mental health tofind ways of encouraging people, to see ways ofsupporting people to recover, to move back more fullyinto society where they can have a job, where theycan look after their own children, where they canengage in whatever it is that they are interested inengaging with. If services are more fragmented, thatdoesn’t become impossible but it becomes moredifficult to manage.Andrew Harrop: All those points apply to complexneeds in old age as well. We want to see a focus onintegration, so perhaps commissioning wholepathways of care rather than just episodes, and alsocollaboration across the boundaries of whatevercommissioning arrangements are in place.Jeremy Taylor: I would echo that. One of the keydomains of patient experience, as measured throughvarious survey and research work, is the need for co-ordination and continuity of care. It’s one of the thingsthat doesn’t work nearly well enough. If thecommissioning commissions across pathways, seeksintegrated care, seeks quality and involves the patient

in that process, then that’s a good basis for decidingwho then provides that care. I think patients care lessabout who owns the provider than how good the careis. So there is a role for “any willing provider” up toa point, but it needs to be carefully regulated.Katherine Murphy: To add to everything that hasbeen said already, what I think is really, reallyimportant for a patient is the continuity of care andalso for them to know who is providing the care.There is the opportunity with the fragmentation ofservices that is quite disruptive from a patient’s pointof view.Chair: The last word to Andrew George.

Q450 Andrew George: Earlier, Mr Harrop, froma patient third sector provider perspective, you raisedthe issue of what might be termed the unrealisticoptimism, or perhaps cynical pessimism, aboutwhether the new structure of GP consortia would beup to the job of reviewing itself and being subject tosufficient scrutiny, or even peer review amongcolleagues. Could you just elaborate a little bit? Doyou think that the structures—the consortium asproposed—will be up to the job and open to scrutiny,and if not, what do you think could be put in theirplace to make sure that they are open to the kind ofscrutiny and review that is necessary in order to takethem forward?Andrew Harrop: Older people are really keen on GPsbeing more involved. So we don’t have a problemwith the principle. But we have already discussed thelack of lay involvement in the consortia themselvesand that will be important. There is also the dividebetween the commissioning of primary care by thenational board and then the process by which GPswould help improve each other’s primary care locally.That seems a bit unclear and I would advocate greaternational direction and oversight, possibly with astronger regional presence than appears to be beingenvisaged at the moment.

Q451 Andrew George: So going back to SHAsagain?Andrew Harrop: It’s not one or the other. There isa case for having some clinical expertise atsub-national level. That’s not the same as a hugeadministration.

Q452 Andrew George: But the local medicalcommittees currently exist. Do you think that theysimply need to be beefed up and given a few moreteeth?Andrew Harrop: Our experience is that gettingclinical networks of specialists in different areasworking more effectively with primary andcommunity care that would be most important.Chair: Thank you very much for your contributionsthis morning. I am sorry if we have kept you a littlelonger than we anticipated. Thank you very much.



7 December 2010 Karen Jennings, John Ransford CBE, Dr Frank Atherton and David Worskett


Witnesses: Karen Jennings, National Secretary for Health, UNISON, John Ransford CBE, Chief Executive,Local Government Group, Dr Frank Atherton, President, The Association of Directors of Public Health, andDavid Worskett, Director, NHS Partners Network, gave evidence.

Q453 Chair: Good morning. Thank you for yourpatience and I apologise for keeping you waiting. MayI ask you to begin the session, please, by introducingyourselves very briefly?John Ransford: I’m John Ransford. I’m Group ChiefExecutive of the Local Government Group.Karen Jennings: My name is Karen Jennings and I’mthe Head of Health for UNISON.Dr Atherton: I’m Dr Frank Atherton. I’m the Directorof Public Health in North Lancashire and thePresident of the Association of Directors of PublicHealth.David Worskett: I’m David Worskett, the Director ofthe NHS Partners Network, which is the independentsector providers in the NHS Confederation.

Q454 Chair: Thank you very much, and thank youfor coming. I would like, if I may, to begin thequestioning by putting the same question to you thatI put to the previous group of witnesses at thebeginning of the last session, and that is to drawattention to the huge challenge that is implicit in whatwe refer to as the “Nicholson challenge”—a 4%compound over four years efficiency gain—the factthat that is being addressed by the NHS alongside thechanges foreshadowed in the White Paper, and to askyou where you feel that process currently stands inlocal areas. Are there any conclusions you would liketo offer to the Committee in the discussion about howquickly the changes that are anticipated should beimplemented, particularly against the background ofwhat Sir David Nicholson said a couple of weeks agowhen he was here about the current developmentswithin the world of PCTs, and in particular his plan todevelop clusters of PCTs? Mr Ransford, would youlike to start?John Ransford: There is a series of huge challengesat the moment, Chairman, and that is one of many.In local government we are very used to that sort ofchallenge in terms of that level of efficiency savingand making sure that we concentrate on the keyoutcomes. I think it has got to be seen in the contextof two major issues. One is to change the way inwhich things are done, to move to a service which isbased on the needs of the individual, the patient, thecarer, the group of people at the centre and theoutcomes they need. The second is to do thingsholistically, to use an old social work word, to look atthe total needs of an individual and the way in whichthose needs are met on a systems approach. I thinkthe proposals on commissioning, and indeed theco-related proposals on changing public healtharrangements, give us the opportunity to do that. Wewill be able to concentrate on health rather than illhealth, on prevention as well as treatment, andcommunity capacity as well as specialist capacity. Itdoesn’t in itself provide an answer to the question youposed, but it does plot a route through how it mightbe achieved.

Q455 Chair: How quickly would you like to travelalong the route that you have plotted?John Ransford: We have got to travel very quickly.The resource constraints alone of the next few yearsmean we have to change very quickly indeed. But wedon’t start from a new base. We start from a lot ofexisting good practice, a lot of existing co-workingand some excellent examples of joint arrangementsacross the country. But we have to be brave and wehave to put behind us a whole series of organisational,professional and business imperatives to do thingsdifferently and look at the needs of place and, withinthe needs of place, the individuals, families andcommunities that are dependent on the servicesprovided.Karen Jennings: I am very pleased to be answeringthis question because there is a high level of concernfrom UNISON’s perspective that we have potentially£20 billion of efficiency savings to be made over thenext four years at the same time as we have radicalreform taking place in the NHS. There are anestimated £20 billion of savings to be made alongsidethe costs of the reforms themselves, which areestimated at the moment to be about £3 billion. Inaddition to that, there is a whole range of otherconcerns about the funding of the NHS, such asmoney being transferred to local government. Localgovernment very much needs that money, but weknow that there are deficiencies in the funding of localgovernment and that in itself will put additionalpressures on the NHS. Health economists estimatethat you need at least a 3% inflationary rise for theNHS to keep pace with new treatments, the costs ofpharmaceutical medicines, demographics and so on.What I am trying to describe to you is an NHS underincredible pressure at the same time as these reformsare taking place. It’s not just UNISON’s view. Manyimportant think tanks have expressed the same view,because the pace of change of this White Paper, albeitthat it’s been slightly delayed in its passage throughParliament, is starting to happen already. There aredeep, deep concerns from UNISON—UNISONrepresents 1.3 million members, and 500,000 of thosework in health—and, also, not just from think tanksbut charities. Charities have also expressed deepconcern about the pace of change that is about tohappen. Not only that, but we are going to see a 45%cut in the very managers who are meant to beimplementing this. It is an incongruous number ofmajor issues impacting on the NHS, which is going tocreate a huge dynamic and create massive difficultiesfor the NHS, and in particular for the delivery ofservices.

Q456 Chair:: Is it not the case that one of the thingsthat is said is that given the requirement of theNicholson challenge and the pace of change, it isurgent to get a structure in place to manage thatchange, and that that argues for quickening the




process of changing the management structure inorder to be able to manage the process? That seemsto be a bit the flavour of what Sir David Nicholsonwas saying when he came here.Karen Jennings: The trouble with all of this is thatnobody knows what any of this is going to look like.

Q457 Chair: That is why I am asking you. Wouldn’tit be good to know?Karen Jennings: You are getting rid of 45% ofmanagers who are charged to do that, and they havespeeded up the pace at which they are going to get ridof strategic health authorities and for PCTs to startto take off. Most GPs have said they don’t have theexperience to do this. There is going to be a hugeamount of education and training that needs to takeplace. We are on shifting sands all the time and reportafter report after report—previous Health SelectCommittee reports—have demonstrated that we havehad umpteen numbers of reforms. None of thosereforms has proved of huge benefit to the NHS; theyhave cost huge amounts of money and served todemoralise those that are trying to deliver care. Itseems to me that this is over-ambitious, particularlyat a time when this Government are wanting todemonstrate that they can manage a deficit, and it isgoing to cost more money. I don’t think we could bemore clear than that.

Q458 Chair: Thank you. Dr Atherton?Dr Atherton: My perspective comes from fellowdirectors of public health, who are currently of courseemployed in PCTs but are moving into localauthorities. There is no doubt that I recognise thepicture of PCTs under stress. There is no doubt aboutthat. PCTs have got to develop GP commissioners.They have got to save their slice of that £20 billion.They have got to manage the whole transforming ofcommunity services and the shift to provider servicesinto new organisational forms, deliver the 40%management costs that we have talked about, managethe public health transfer and, of course, manage theirown demise over three years. So there is no doubt thatPCTs are under stress.Having said that, generally speaking, the message thatI hear from directors of public health is that they are,to a large degree, starting to deliver on the QIPPagenda. The difficulty has been that bits of the QIPPagenda, which started originally around quality,innovation, productivity and prevention, are gettingless attention. It is very focused, of course, onproductivity at the moment and cost reduction. Thewhole dimension around prevention, to some degree,is not getting the same level of attention. What I alsopick up is that GP engagement, clinical engagement,in the process is variable, and where it’s working wellthat does have benefits and that augurs potentiallywell for the future of clinical commissioning.If I bring that all back together, it leads me to theconclusion that if we are going to make thesechanges—and it seems we are—then the pace shouldprobably pick up. I say that for two reasons. One isthe need to deliver on the productivity saving we havetalked about. Also, in terms of public health and thenew public health service described in the White

Paper which was published last week, there is a needto quickly move to create a new integrated publichealth system. I would agree with John as well thatfocusing commissioning on integrated health andsocial care commissioning and on the needs ofindividual patients are very strong points which weneed to move on with quickly.David Worskett: The independent sector view on thisis that the challenge facing the NHS, in terms of thefunding problems and the shortage of money goingforward, is so great that without pushing ahead veryquickly with the major reforms there is very littlechance of achieving the QIPP objectives. The reformsare absolutely vital in order to meet the fundingchallenge. So it seems to us that there isn’t muchchoice. You have to get on rather quickly with thereform programme in order to be able to achieve thechanges to funding that are inevitable given theoverall economic climate. There are certain aspects ofthe reforms which are hugely important to achievingthose funding improvements. We need easier marketentry for innovators. We need more innovation. Weneed to do things differently in order to save themoney.Moving on to the second part of your question,Chairman, the other thing one needs in a complicatedscenario like this is very strong transitionmanagement. We do have major concerns about thestrength of transition management. It may be strongat the very top of the NHS but on the ground what weare seeing, as independent sector providers, are veryclear signs of a rapid weakening of PCTs’ grip ontheir local health economies and on the market. Weare seeing, in very practical terms, fewer tenders. Weare seeing a breakdown of discipline in terms ofadherence to the rules and principles for co-operationand competition. We are seeing a loss of momentumin encouraging innovation and visible departures ofgood people from PCTs. I think if we don’t get a gripat ground level on transition management it could goquite badly wrong. To return to my first point,speeding up the reform process and getting it throughis going to be one of the key secrets to meeting thefunding challenge.

Q459 Chair: That seems to be one point, not two, ifI may. Your answer is that it needs to be speeded upin order to achieve the challenge but also becausethere isn’t an alternative. Is that correct?David Worskett: I think that is true, and the transitionmanagement issue is crucial.

Q460 Chair: I suspect Karen Jennings doesn’t agreewith that.Karen Jennings: I do think there is an alternative.What we are seeing, for example, is primary caretrusts starting to cluster. I think it would be a terribleshame, in the White Paper, for example, to remove thestatutory responsibility of primary care trusts. Whydo that if they are starting to cluster and reconfigurethemselves? I think there is an alternative to the WhitePaper. It seems to me we should be looking to try andexert some influence around how that might work inthe future. One of the problems at the moment is thatthe transition is held up because there is no form and




function. In other words, there is no equivalent bodyfor staff to transfer into. The whole human resourcesagenda is lagging way behind what is happening andtherefore staff are not able to TUPE across so we arestarting to lose them, and the talent that remains isbeing removed out of the PCTs and taken into thecentre. There remains this central function at the sametime that we have this massive insecurity going on.We are starting to see this wide variation. It’s a mess.It’s a complete and utter and total mess. That isbecause it has not been thought through. What wehave is a White Paper without detail, with subsets ofpapers that are coming out, but it’s almost like policyis emerging as we go along in response to whatemerges. How anybody can predict that this is goingto be something that is going to benefit patients in thelong run and have a structure which will function?You are gazing through a different crystal ball forsure.

Q461 Chair: Mr Ransford looks as though he isimpatient to make a point, and then I am going tobring in Sarah Wollaston.John Ransford: I have two points really. One is thatI agree with all the other contributors that transitionmanagement is crucial here. This is a massive changemanagement process. It is a risk and what you do withrisk is mitigate it. I think you need all of the resourcesthat we jointly have to mitigate that risk because, ifthe NHS particularly tried to do it in the old way andtake the sort of reductions that are being mooted here,then I think that is probably not achievable. But theother point—I made it earlier and I think it isimportant—is that there is a massive opportunity hereto do things differently and get better outcomes forpeople and use public money more effectively. Wehave got to go through that change move to get here.It is the responsibility of all of us to make sure we dothat in a way that achieves better outcomes, and Ithink we can.

Q462 Dr Wollaston: Before moving on, can I goback to something you touched on earlier aboutintegrated working between health and social care?I presume that is what you mean by improvingoutcomes.John Ransford: Yes.

Q463 Dr Wollaston: In some parts of the countrythat is happening quite effectively already. How doyou feel, within the White Paper, we can encouragethat process, so to preserve it where it’s alreadyhappening and encourage it where it’s not?John Ransford: Certainly where it is happening—andthere have been some quite advanced approaches tothis—that must not stop because there is a newgeneral principle, if you like. We need to keepbuilding on those processes. It seems to me thatcommissioning, determining the healthcare needs asnear to the locality as possible, is a good thing.Certainly general practitioner commissioners willneed a lot of help and support to do that job. Localauthorities, as very experienced commissioners, canbring a lot to that party, I think. When I came intolocal government in the early 1970s we were almost

entirely service organisations. That is what we did.Certainly since it has been enshrined in legislation thatthe role of the local authority is a community leader,commissioning has been a much greater part of ourarmoury, if you like, so much so that some localauthorities primarily commission their services fromother people. The important point is, what is thequality, what is the value and what is the localacceptability? My argument is that you are much morelikely to achieve that with everyone working togetherrather than in separate silos.

Q464 Dr Wollaston: Do you think that is achievedthrough individuals and good leadership or throughstructures?John Ransford: Both. The most important thing ispeople working together at a local level because withmost people, when they do work together at a locallevel and leave their professional biases behind, theevidence is that they do it very well and we’ve seenenormous growth in that. But you have got to havea system that supports them and enables that tohappen, which is why we have all said transitionalmanagement is crucial.

Q465 Dr Wollaston: Do you think it is importantthat you have coterminous boundaries to help thathappen?John Ransford: The evidence of the last decade anda half is that coterminosity is an enormous fillip tothis, and the boundary that is most commonly used isthe local council’s boundary. It’s not perfect. In bigrural areas, which you and I both know, you have tobreak it down a bit more than that sometimes forservice reasons. There are cases in certain areas andfor certain services to bring groups of authoritiestogether, but I think having a common geographicalbase is a very strong determinant. If you don’t do that,there needs to be a good reason for it.Dr Atherton: It is carrying on the same theme ina way. Just to wind back slightly, one of the worstthings that could happen in the transition is to go backto the bad old days of health and social servicespassing responsibility and budgets between them andbasically playing beggar-my-neighbour. We need theintegrated system quickly to prevent that happeningbecause both local authority and NHS budgets areunder stress. That is a really important thing.Also you asked what we could do in the new system.There is something about GP development andmaking sure that the consortia understand the benefitsof these types of approaches. It’s not just about health;it is about the broad integrated health and socialwellbeing.Then on the point about coterminosity, I entirely agreewith John because it is somehow anecdotal, but wherewe have seen good practice and where we have seenplaces start to lead on developing the health andwellbeing of their populations, it has been where wehave had that health and social care coterminosity. Itis a real boon. It is not a prerequisite, but it is a boon.It really helps move things along. There’s a realdanger, depending on how the consortia evolve, that




we could move further away from coterminosityrather than towards it, and I think that would be notin the interests of the system.Karen Jennings: My point has just been made for me.We went through what was called shifting the balanceof power, which was bringing PCTs into coterminositywith local government or borough councils, and thathappened, I think, in 2006, so they are coterminousnow. Why are we removing a structure which iscoterminous, which would advantage planningtowards integrated care? There have been someenormously good strides and steps towards that.I think what we have to do is look at best practice inrelation to that and start spreading that out rather thanreinventing the wheel, finding new commissioners,particularly if they are led by GPs. We know fromcharities that we have been working with—particularly those charities where they representpeople with long-term conditions, mental health,domestic violence, Parkinson’s Disease Society—thatthey are all deeply concerned that generic GPs do nothave the specialist skills to enable the sort of contractsand commissioning that you would want with localgovernment. I can feel some nods on one side of methere. What we need to do is to make sure that wekeep that coterminosity as it is rather than threaten itwith another reorganisation.

Q466 David Tredinnick: This is a question forDavid Worskett. You spoke earlier on about thereforms needing to lead to more innovation. Do yousee that as a wider choice of treatment options forpatients, and in particular I was thinking of whetherosteopathy might be more widely available because ofthe huge problem we have with people taking time offwork because of lower back pain problems?David Worskett: Yes, I think that is absolutely one ofthe forms of wider choice that we need to enable. ButI would like to make a link to what has just been saidabout the position of GPs and commissioning as well.If we look at what can be done, given a chance, interms of innovation, although the role of theindependent sector in the NHS is still astonishinglysmall—I am continually surprised by the excitementthat it generates given just how small it is asa proportion of the whole—where we have gotevidence, for example, from some of the goodproviders of home care of various sorts, includingmusculoskeletal treatments and things of that kind,there is independent research which shows verysignificant savings and improvements in the quality ofcare happening at the same time. My great worryabout disaggregating commissioning is that it will bemore difficult to share understanding of best practiceon what can be done, there will be less bravery aboutintroducing new types of service and we won’t be ableto take the benefits of these different ways of doingthings, doing them better, cheaper and providing morechoice, as easily as if the process is in the hands ofpeople who do understand what can be done and cantransfer best practice across the country more easily.

Q467 David Tredinnick: I understand what you aresaying, but are we not doing quite the oppositebecause we are giving GP commissioners the chance

of more choice so they can follow a particular line oftreatment if they want to, as they used to with GPfundholding?David Worskett: But it does depend upon themknowing what’s available, how it will work and whathas succeeded elsewhere. The best of the PCTs arebecoming receptacles of that sort of knowledge andare therefore in a better position to implement it anddrive it through. I think a lot of GPs are very worriedabout the level of knowledge and skill that they willhave to address some of these issues.

Q468 Andrew George: I want to come back toMr Worskett mainly, although I think Mr Ransfordmay wish to comment on this as well, on the argumentyou advanced that, because we are currently ina climate of uncertainty, that is not helping andtherefore we need to move much more rapidly toa situation of certainty. It is the problem of theuncertainty of transition, not quite knowing whetherwe are going to get there or not. Is it simply that youbelieve you want to have more certainty, or is it thatyou are confident that the GP consortia structure isone that will provide not only the certainty but a betterframework to achieve the kind of efficiencies that youare talking about, bearing in mind, for example, thediscussion we’ve just had that you may, therefore, gobackwards in terms of coterminosity of services, forexample?David Worskett: I think we are far from confident thatthe structure, so far as we can see it for GPcommissioning, will deliver certainty of a constructiveand helpful variety. I think that’s the short answer tothat.

Q469 Rosie Cooper: I would like to ask a couple ofquestions but start off with this. Local authorities areexpecting £1 billion to be set aside for social carefrom the health budget. What is your understandingof the way that money is to be spent? Will youactually be spending it?John Ransford: We haven’t got a full picture yet untilwe know what the actual settlement is for localgovernment because these two things interact. But,certainly, following the themes, we have the ability touse that money in a different way. At the moment, thefunding streams are separate. I think it is a remarkablebreakthrough in these economic circumstances thatthe Department of Health has seen that investing incommunity services solves the problem. There is afunding crisis in social care. That is being looked at.But it does give us an opportunity to invest properlyin the system where we know that needs are risingand dependency is greater.

Q470 Rosie Cooper: Local authorities and PCTsconcurrently pool budgets and delegatecommissioning to support the integration of services.How might those services be protected during thisvery difficult management transition and, if I might bea little controversial, using your words earlier,Mr Ransford, you talked earlier on about being brave.Would it be brave for local authorities to hand overtheir social care budgets to the NHS so that they candeliver the whole of that care?




John Ransford: On the first question, I think it isabsolutely crucial that we take opportunities of doingthings differently. On the second, I don’t think localauthorities should be precious about who has theresource. The question is: how is that resource bestused for the needs of individuals? So if the NHS hadthat budget and it was proved to be more effective,there would be no rational case against that. The big“but”, though, of course, is that local authoritiesprovide a lot of other things that support people insocial care—housing, environmental improvementsand community services—so it becomes part ofa package. It is not only the social care money. It isthe experience of an improved quality of life thatcounts. That is why local authorities, who areproviding services much more broadly on a horizontalbasis, I think, are best placed to use that effectively.Dr Atherton: One potential help to the system whichmight be a useful use of that £1 billion of transfermight be to say—and I know some local authoritiesare starting to think this way—that this is a resourcewhich potentially could help to drive the system, notjust to shore up social services or to shore up healthbut to put it into almost the remit of the nascent ordeveloping health and wellbeing boards to say, “Howcan we manage that effectively to help the wholesystem rather than just a part of the system?” It mightbe that that might be a resource which could help theboards to get started in some areas.Chair: That is an area we would like to probe in somedetail—what the implication is of the White Paperpolicy on Health and Wellbeing Boards and localgovernment engagement in this process.

Q471 David Tredinnick: This is a question forKaren Jennings, if I may. UNISON’s response to theWhite Paper states that Government plans “representa major downgrading of the councillor role inscrutinising local decisions”. What democratic inputdo you think there should be in commissioning,please?Karen Jennings: What the overview and scrutinycommittees have been able to do before is to havea robust examination of plans by health trusts, byPCTs. In addition to that, the make-up of thoseoverview and scrutiny committees would be byelected councillors. The health and wellbeing boardsare suggesting that there would be one, potentially,elected senior person sitting on that committee andthen a range of others. We don’t know who they areor what their interests might be. Therefore, there isa downgrading of the role of overview and scrutiny tohealth and wellbeing boards. In addition, there wouldbe some concern that, for example, if you hadmembers of the voluntary sector sitting on thosehealth and wellbeing boards, there may be a conflictof interest. For example, the particular voluntarysector sitting on the board may well be trying tobecome a service provider. You wouldn’t have that inan overview and scrutiny committee.

Q472 David Tredinnick: Thank you for that, butI put it to you that the accountability and the scrutinyat local council level has been incredibly weak

because most local councils don’t see scrutinisinghealth care as part of their remit. A lot of thesecommittees are virtually dormant. We are talkingabout downgrading a base which is pretty lowanyway, are we not?Karen Jennings: That is certainly not my experienceof overview and scrutiny committees. In fact overviewand scrutiny committees have taken greaterimportance since we saw the demise of communityhealth councils and the setting up of patient and publicinvolvement. Gradually there has been less challengeand less advocacy on behalf of the community up anddown the country, who have, I know, regularly lobbiedoverview and scrutiny committees to challenge and tocharge PCTs with explaining why, for example, healthvisiting services are no longer universal. Myexperience of overview and scrutiny committees isthat they are very robust and challenging.

David Tredinnick: I think, through you Chairman,one of my colleagues wants to come in on this.

Q473 Rosie Cooper: I am not a great fan ofoverview and scrutiny committees, not because thereis not expertise, but I primarily because the healthservice decisions that are taken are very rarelychanged by it. The health service sees the overviewand scrutiny committee as a hurdle to overcome. It’snot the joined-up place where these things can be dealtwith. I suppose my real problem with this whole thingis that I didn’t think a lot of overview and scrutinycommittees to begin with and to see them downgradedeven further is just outrageous. But the way to dealwith this is to have the challenge at the board whenthe decisions are being made. I had previouslydescribed an overview and scrutiny committee as likethrowing snowballs at a moving truck. Yes, you couldsay it, you could object, but you didn’t actually makea great difference. The reality is here that the powerand the patient voice is moving further and furtheraway from the point of decision making. There shouldbe some non-exec patient—however that isconstructed—voice at the table with a vote. Any othersystem is window dressing for me.Karen Jennings: Could I come back on that, becausewe could focus just on overview and scrutiny andhealth and wellbeing and look at better ways ofdeveloping Patients Voice and local accountability?This entire White Paper is creating a light touchoverview and scrutiny. What we are seeing is theSecretary of State’s powers reduced. He no longerwants to be accountable to Parliament for our nationalhealth service. We are seeing a NationalCommissioning Board which is going to overseehundreds of different trusts, and how is it going to dothat without strategic health authorities or some othersort of regional body in there? We are seeing Monitorbeing established and we don’t know whether that isgoing to have regional outputs, but it has conflicts ofinterests; it is going to set the tariff but it is also goingto oversee the competition element of what is goingon. The whole paper is about moving away fromoverview and scrutiny and light touch. Overview andscrutiny in local government, when it is at its best,works very well and is democratically accountable at




least to elected people who have to declare where theyhave an interest. The wellbeing boards could runalongside it—absolutely alongside it—but to get ridof overview and scrutiny, when there is virtually goingto be no other area where we are going to be able tohave, or at least the public can go and demand thatthe consortia come and explain their plans—

Q474 Rosie Cooper: I don’t disagree with the trainof thought; I definitely don’t. My problem is that Iactually believe the consortia board should be openand the public should be able to be there, see and hearit and have a vote, a voice, at the table. So whilstI hear what you are saying, I believe it can be dealtwith much more upfront by making thedecision-making body hear and let patients, or public,however that would be, have a voice at the table.Chair: Can I bring other witnesses into this dialogue?Mr Ransford?John Ransford: Certainly I would agree absolutelythat we need both an executive function, which iswhat the health and wellbeing boards are envisaged tobe about, and overview and scrutiny. They are not thesame thing; they are different things. You needa strong executive function and a strong scrutinyfunction. The evidence over the last 10 years is mixed.At its best, I think it is excellent through the localauthority overview and scrutiny committees, but byits very nature in some places it is not seen asimportant. It is crucial in this because, to borrowa phrase from somewhere else, “Everyone’s in thistogether”. All of the service providers and all thesystems are brought together and that needs to bepublicly accountable. At least with the overview andscrutiny system those people are drawn from folkswho are elected by their peers. They are elected bythe local communities. In other systems, you have towork out who is representative, where I think there isa very great danger—Karen mentioned this earlier—of vested interests or conflicts of interest being builtinto the system, and that wouldn’t help anybody.Dr Atherton: I also don’t see the health and wellbeingboards as the same as overview and scrutiny or anevolution of it. They are a very different thing. Nor dowe want them to become talking shops that everybodyattends and which achieve very little. We await detailof exactly how they are going to work, and it maywell be left to local areas to decide how to make themwork most effectively. However, the potential forthem to act on behalf of the local area and thepopulation to steer the development of health servicesis enormous. It is clear that they are not going to havesign-off over GP commissioning plans—that is notgoing to happen—but they should be able to influencethose commissioning plans.If we get the joint strategic needs assessment right,the health and wellbeing board functions as theadvocate on behalf of population need, and we makesure that the National Commissioning Board signs offGP commissioning plans according to what the healthand wellbeing board wants to see, and then it is heldto account for that, then we are getting to a systemwhere at last local government is in the driving seatin influencing how healthcare services are developed.They are not coming in at a very late stage in the

process and either being asked to rubber stamp itthrough overview and scrutiny or just to put upbarriers through overview and scrutiny. Potentially,the health and wellbeing board could have a verystrong role in determining how health and social careservices are placed. That would be the vision I wouldaim for. But, again, most of it may well be left forlater determination.David Worskett: I have only one point to add, becausethis isn’t really my territory. Somebody said that itwas very important to have transparency and visibilitywith regard to what goes on in the boards of thecommissioning consortia. That is a real concern to mymembers and I think that does need to be verytransparent. The governance arrangements there needto be scrutinised very carefully for the reasons thathave been suggested. However that is done, it seemsto us to be a fundamental feature of the design ofGP commissioning.

Q475 Chair: I was struck that Dr Atherton said thatsign-off on GP plans by the health and wellbeingboards “isn’t going to happen”. I understand why yousay that, but the LGA was, I think, pushing quite hardfor exactly that principle.John Ransford: Yes. There are two reasons really.One is the transparency points. Everyone ought to beinvolved in this so that it is very clear what the plansare and everyone has a stake in it. Secondly, KarenJennings made the point that there are often groups ofpeople who don’t come in to the big centralcategories, for whom we do need to make sure thatservice provision is there. I think you need a widerview of what needs to be involved just to check thatthere is a proper community response to communityneeds. It’s not, I think, meant to be a power thing atall. It’s making sure that everyone who has a stakeboth has a chance to voice that stake and make it workthrough the outcomes.

Q476 Chair: Do you think there is a risk of twoprocesses being set up in parallel here, with theGP-led consortia doing their commissioning and thejoint strategic needs assessment being done with GPinput but without sufficient GP influence over thoseprocesses?John Ransford: That is why I argued at the beginningthat the GP commissioning must be done in context,including in respect of all the other commissioningthat is going on in an area. We have to get muchsmarter about what commissioning is and who isresponsible for what. Again, it’s a major opportunityhere because the systems at the moment are tooseparate.

Q477 Chair: There is a question on how effectivethe LGA input—local government input—is in thecommissioning process. There is also the reversequestion: how effective is the GP engagement in thejoint strategic needs assessment?John Ransford: As I said in response to an earlierquestion, it’s very important that you build and investin relationships and joint arrangements to ensure thatthat happens. Secondly, you must have a system thatresponds to those needs.




Dr Atherton: I agree entirely. It’s really important thatthose processes are joined up. Of course directors ofpublic health are moving into local authority mattersand will be sensitive to that as an integrator of thesystem. There is a real risk in the system here, whichis that many GPs that I talk to are very focused onprevention and on marginalised groups but many arenot. That broad population perspective is reallyimportant because there is a risk that groups such asthe homeless, those with drug and alcohol problems,people with learning disabilities or mental healthproblems and asylum seekers could fall through thegaps because they are not necessarily visible on GPradar screens. But they will be visible and should bevisible through the JSNA process. I don’t believethere will be a sign-off power. I don’t believe that theSecretary of State wants a sign-off power, but I thinkit’s really important that the JSNA and health andwellbeing boards have a strong influence on the GPcommissioning plans, otherwise those groups will beforgotten yet again.

Q478 Rosie Cooper: Can I ask a quick question? I’mthinking this through as well. If there is a greaterreliance on GPs to get involved in the local needsassessment, the wellbeing boards and all the rest of it,how are they going to get paid, because they won’tattend if they don’t get paid?John Ransford: I think that is one of the details thathave to be worked through. You can’t have it bothways.

Q479 Rosie Cooper: No, but it’s a pretty importantdetail. We are going to an integrated care model in mylocal area and doctors who are, in theory, in favouractually have not attended. They have had 20opportunities to attend meetings and the reason theyhaven’t is because they wouldn’t have been paid toattend. If this is all going to be based on, “We are allin it together”, and you are going to need the GPs toinfluence X, Y and Z, my question is, how are yougoing to get them to attend? Who is going to pay?Dr Atherton: There is a very practical answer.Currently, there are arrangements which do, in someareas, allow GPs to attend those sorts of meetingsthrough locally enhanced services, so they haveresources to pay for the back-fill for them to do that.In the new world that is envisaged, clearly GPs willhold the management costs and it is for them to decidehow they use those management costs. Part of itwould presumably be used to allow them to undertakethose kind of broadly defined management jobs asopposed to their clinical workload. They will beholding the resource.

Q480 Rosie Cooper: It’s a really big importantquestion.Dr Atherton: Yes, it is.

Q481 Rosie Cooper: What if they choose not to, asthey have done in my case? They can go somewhereelse.Dr Atherton: That is a different question, though.Choosing not to be involved is different from nothaving the management costs. Some will choose not

to, but by and large, if we have consortia working atlarge enough areas, there will be GPs who have aninterest in these sorts of areas.Chair: Do you want to come in, Sarah?

Q482 Dr Wollaston: I wanted to ask a question toDavid Worskett about transparency of contracts. Oneconcern that some people have voiced is the capacityof GP commissioners to make those “make or buy”decisions and whether or not, every time theycommission a service, they will risk being held tosome kind of legal account as to whether they haveoffered that out to the private sector. What is yourview on that?David Worskett: I understand the question. Let mejust organise the points carefully. First, for quite a lotof current arrangements, if we are not going to havea huge growth in transaction costs and actualtransactions—for example, a member of NHSPN with70 hospitals ideally would not have to enter into 70similar but none the less expensively slightly differentarrangements with 70 different GP commissioners—one would hope for some form of nationalaccreditation and something which simplifies life andreduces transaction costs both for the provider and forthe commissioners. We have to find ways of removingas much of this administrative and legal burden fromGP commissioners as we can. Certainly, where youhave providers who work across the whole country,looking at some form of national accreditation forthem would be a sensible way of doing it.The second point I need to make—and it goes back,in a way, to my concern about the burden which islikely to be placed on GP commissioners—is that theywill be handling a vast amount of public money andit will be incumbent upon them, as with anyorganisation handling vast amounts of public money,to secure best value for it. That does mean being ableand knowing how to adhere to public procurementprinciples, procurement law and rules for state aidsand things of that kind because if they don’t have theexpertise available to deal with those things, yes theywill face challenge, and I would have to say probablyrightly so. They will face challenge, in a sense, onbehalf of the taxpayer because there will not be theevidence that that money has been deployed in themost effective way. I think there is an issue there, andI sympathise with GPs, looking at this, but I don’tthink we can escape the fact that, if you are handlingthat much public money, you have to do it in regularand visibly correct ways to show you are getting bestvalue. There is a problem.

Q483 Dr Wollaston: To clarify, you think yourmembers will be taking GP commissioners to court ifthey are not seen to be involving the private sector intheir day-to-day commissioning of contracts?David Worskett: If GP commissioners turn out to bein breach of generic laws on non-discriminationbetween providers and it can be shown that they havenot gone through the correct procurement processes toget best value for the taxpayers’ money, challengeswill come perhaps from my members or perhaps fromelsewhere, but this is a broader issue thana public-private argument.




Karen Jennings: Gosh, what a horrible world we aregoing to enter. Goodness me. Yes, GPs will be suedand it’s not surprising, therefore, that the recent King’sFund survey demonstrated that no more than abouta quarter of GPs want this to happen. I think ClareGerada, the chair of the Royal College of GeneralPractitioners, has a vision in the future of picketsoutside GP practices where patients are being deniedtreatment because they may be rationed or—whoknows?—Viagra or something is not being offered.Because of the cost constraints that exist already—£80 billion is set to go to GPs, but the health serviceitself is going to be experiencing huge costconstraints—we do know at the moment PCTs that arealready starting to ration. We know of Warwickshire,West Kent, South-West Essex, Warrington,Portsmouth City and Central Lancashire, which arealready putting notices out about certain electivesurgeries that they will not do. Rationing is starting totake place.Can I also say that, under the cost constraints, hot offthe press and out of polls today, Department of Healthstatistics are showing that patients are missing out ontreatments within the 18 weeks’ referral system? Thefigure has jumped by 15% between July andSeptember this year. We understand from legal expertsthat this could leave GP consortia open to being suedby patients. Even though the Department of Healthhas relaxed the 18-week target, it is still there in theNHS constitution, which potentially could be used bypatients litigiously.Chair: I think I am going to introduce Valerie—

Q484 Valerie Vaz:—on that hot topic. I want tomove to public health. Please, all of you, feel free toanswer my question, but I suppose Dr Atherton is themain person to do it. Members of the Faculty ofPublic Health were concerned that “healthcare publichealth” wasn’t an issue in the White Paper. Howimportant do you see that both in terms of success forGP commissioning and also the NHSCommissioning Board?Dr Atherton: It brings me back to the question ofwhere GPs are going to get their experience from, interms of commissioning on a population basis. One ofthe groups of public health practitioners who currentlywork within the PCT environment, of course, arehealthcare public health specialists. They supportPCTs—primary care trusts—in terms of planninghealth services, sifting the evidence base and helpingus to understand the evidence, making those difficultdecisions around prioritisation that we were juststarting to talk about, looking at the evidence of whatworks and the evaluation of what works as well.These are really powerful skills which GPcommissioners are going to need to access. There wasvery little discussion of that in the White Paper. Infact, we have seen some encouragement in the publichealth White Paper, where that dimension is addressedto some degree, along with the broader area of healthimprovement and protection that is the main focus ofthe White Paper. But all three of those dimensionsare really important. That part of the work force issomething that we need to protect so that it isavailable to GP commissioners. I’m not sure exactly

how that is going to work, but my vision would bethat, as the director of public health moves into a localauthority environment, that would be an opportunityto take that work force and have it available to GPcommissioners. My fear is that, if that doesn’t happen,it could just disappear either into the private sector orsomewhere up the system, perhaps the NationalCommissioning Board, and be lost to GPcommissioners. Again, I am very encouraged because,certainly in my local area, GP commissioners arestarting to ask the questions about, “How are we goingto continue to get those sorts of expertise, that sort ofinput, into our commissioning decisions?”Karen Jennings: We are not clear yet what is goingto happen to those staff that are working in preventivehealth. For example, who will employ school nurses?Who will employ practice nurses? Who will providevaccinations? What happens when you have a flupandemic? Who will be responsible for how the NHScomes together and mobilises around that? That’s notclear yet.

Q485 Andrew George: Mr Worskett, I know thatNHS Partners Network has formally objected to theway in which the PCTs’ provider arms have beenoperating and that there has been insufficienttendering, or rather open tendering, of their services.Given the nature of what is contained within theWhite Paper, and no doubt the conversations that youhave had with the Government, are you content thatthe arrangements, as proposed, would be satisfactoryto your members?David Worskett: The arrangements for communityservices?

Q486 Andrew George: The arrangements for thecommissioning of any health services under theproposals within the White Paper itself.David Worskett: No. As I think I said in answer to anearlier question, we are far from happy that the GPcommissioning arrangements, as we can currently seethem, will produce a workable and sensible outcome.There are a number of real difficulties with them. Oneis the sheer number of commissioners with whom oneis potentially going to have to deal. It is important toremember that the independent sector is structuredvery differently from the public sector providers. Mostpublic sector providers work in quite limitedgeographic areas dealing with a relatively smallnumber of commissioners—in some cases at themoment only one PCT. Not all but the majority of mymembers work across whole regions of the country oracross the country as a whole and therefore will bedealing with very large numbers of commissionerswho will vary in both their quality and skills, and thisapproach is going to be very much more difficult. Itwill create, in a sense, a further barrier to enteringand producing innovative offerings. So that’s clearlya difficulty. Obviously, we are worried about thestance taken by both the BMA and the Royal Collegeof General Practitioners, which is overtly and publiclyhostile to the use of the independent sector. If that wasactually carried through to the way GP commissionersoperate, that would be a fairly significant deterrent toinvestors just at the moment when we probably do




need additional investment from outside the publicsector in our health care services.That said, let me try to finish on a slightly morecheerful note, because I do accept that that is all rathergloomy. In my heart of hearts, I don’t believe thatmany of those Doomsday scenarios will happen,because I have a very strong suspicion that, just asthere are between 4,000 and 6,000 GPs who alreadywork very effectively and competently with theprivate sector in various ways at the moment, many,many GPs, come the day, will indeed want tocommission the best quality services regardless ofwho provides them because that will be in the bestinterests of their patients. Many of them will come togrips with procurement principles and competitionlaw in order do it because they are professional, goodpeople who will want the right outcomes. So it maywell not be quite as doom-laden as the theorysuggests, but it’s a risk one has to take.

Q487 Andrew George: They are also privatecontractors, aren’t they? While I understand that youtake the view that, therefore, the consortia should notbe allowed to grow to ridiculous numbers with tinylittle consortia across the country and it is clearly inyour interests and your members’ interests for thereto be fewer and for them to be more strategic in theirapproach, do you not accept that the GPs themselvesare private contractors with the NHS and that,therefore, they are merely sub-contracting, aren’tthey?David Worskett: We are going to have to see howa clear distinction is drawn between GPs as primarycare providers and the GP commissioning consortiabecause otherwise there will be considerabledifficulties and confusion in the minds of the public.As to the point about scale, I would also pick upa much earlier conversation in this session, whichpointed to scale which aligned with local governmentand things of that kind, and the same issue applies.There is going to be a significant problem about thescale of the commissioning consortia that needs to beaddressed. That problem, if you address it, helps theissues of my members, it helps the alignment withlocal government and it goes to a number of the pointsthat have been made.

Q488 Andrew George: On the more gloomy side ofyour earlier response, will you be, if you like,responding or depending upon, primarily, EUprocurement rules in order to justify the position thatyou are taking and the challenges which you fear—and let’s hope that it doesn’t happen—that you mayneed to advance?David Worskett: Let’s leave the letters “EU” out of itbecause I don’t think we need to go there.Andrew George: It’s public money.David Worskett: The fact of the matter is that acrossthe whole of Government, led by the Cabinet Officeand others, there are rules and principles for publicprocurement designed to ensure that the taxpayer getsbest value. Those are sufficient in themselves for

addressing this problem as long as they are adheredto. If we can stick to Cabinet Office and OGCguidelines for getting best value, actually it will helpquite a lot. But it is quite a tricky area and GPs willneed help with it.

Q489 Andrew George: Mrs Jennings, having heardwhat Mr Worskett has just said, do you not accept theargument advanced against your perspective that youare defending producer interests and that, therefore, indoing so you are not allowing or not permitting anopportunity for more cost-effective ways of providingpublic services within limited resources?Karen Jennings: First of all, as I mentioned earlier,UNISON has 1.3 million members, all of whom usethe NHS at some time or another, so we are notexclusively producer interests. We are a heavilyevidence-based organisation with a wealth ofinformation that demonstrates that the contracting-outprocess can be much more expensive, particularly ifyou get into price competition. Certainly that was theevidence that we produced around hospital cleaningservices and catering services where once you got intoa price competition it was the lowest bidder that wonthe contract and, therefore, the quality of the servicethat you got suffered. And we all know about MRSAand C difficile rates and so on, and also concernsaround catering. Also the contracts that were—

Q490 Andrew George: Can I move you away fromhospital services back to primary care services and thecommissioning of medical services—electiveservices, for example. Is that not a more appropriatearena in which to make your comments?Karen Jennings: We have serious problems with theevidence in those areas as well. For example, in theindependent sector treatment centres that werecreated, they were risk averse; they were providedwith contracts to which they only delivered half thenumber of operations that were required, so you arecreating a false market. In addition to that, theproposals mean that GPs themselves could beoutsourcing to private commissioners who themselvesare already providing services, UnitedHealthcarepotentially being one of them. There are all sorts ofconflicts of interest around this. I really do think weneed much more evidence around what’s happening.In addition to that, you will be aware of the NHS Atlasthat came out recently and the wide variation ofcommissioning that exists already. Majorcommentators have already expressed concern aroundthe whole commissioning process as it stands andpredicted that in the future we are going to createa two-tier system, particularly where you have pricecompetition introduced into the tariff because itreduces services, and those “any willing providers”will not survive in that environment.Chair: I think the Committee has a collective desireto respect its lunch engagements. I do not think thatwe are going to resolve this debate, but Mr Worskettwants to intervene and might like a right of reply.Then Mr Tredinnick wants a response, and then Ithink we will go to lunch.




Q491 David Tredinnick: I have a quick question forMr Ransford. How can health and wellbeing boardsindependently scrutinise commissioning whencommissioners will themselves be represented on theboard?John Ransford: I don’t think they can. I think youdo need to separate the functions. I think health andwellbeing boards are an executive function and youcan’t mix those two things. You need separatescrutiny arrangements.

Q492 Chair: Do you want a brief right of reply,Mr Worskett?David Worskett: I’ll be fast. We are, of course, talkingalmost predominantly, in terms of the independentacute sector, of tariffed services, not services wherethere will be price competition. The ISTC utilisationrate is currently at 87%.Chair: We are not going to resolve that. Thank youvery much indeed for your attendance. We shallruminate on our conclusions. Thank you.

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Wednesday 15 December 2010

Members present:


Rosie CooperNadine DorriesYvonne FovargueAndrew GeorgeGrahame M. Morris

________________


Witnesses: Rt Hon Andrew Lansley CBE MP, Secretary of State for Health, Dr David Colin-Thomé OBE,National Clinical Director for Primary Care, and Dame Barbara Hakin DBE, National Managing Directorfor Commissioning Development, Department of Health, gave evidence.

Q493 Chair: Secretary of State, Dame Barbara andDr Colin-Thomé, you are—all three—very welcome.I would like to begin, if I may, by expressing formally,on behalf of the Committee, our disappointment thatwe have not had the opportunity to consider thedocuments that you have published this morning. Thatcreates a problem, given that this session was intendedto be our last evidence session to look at the evolutionof policy on commissioning in the context of theWhite Paper. I understand that there was contactbetween the Department and Committee staff that wasdesigned to try to facilitate the Committee havingaccess to these documents overnight so that we couldhave had the opportunity to read them and questionyou on them this morning. It is regrettable that thatwas not possible. However, against that background,I think that a message was sent to you, Secretary ofState, asking for a brief statement of the key points sothat they don’t come out slowly during the session.Will you make a brief statement to introduce thesession? I then propose to allow a general questionsession based on your introduction before moving onto more detailed questioning. That seems to me, givenwhere we are, to be the sensible way of handling it. Ihope that is acceptable.Mr Lansley: Of course. I am in your hands.

Q494 Chair: I invite you to make a brief openingstatement of the key points announced today.Mr Lansley: Thank you, Chair.May I introduce my colleagues? Dame Barbara Hakinis the Director of Commissioning Development for theDepartment of Health, and Dr Colin-Thomé is theNational Clinical Director for Primary Care. I thinkthat you have had the opportunity to talk to bothBarbara and David in previous evidence sessions.Both of them are, by profession, general practitionersof seniority and long standing.I entirely understand the Committee’s point of view,but it will understand that there are limitations to howfar in advance of publication before Parliament thesedocuments are ready to be circulated. That is thematter, I am afraid. It would have been, in my view,far more regrettable for us to have met today and thento have published them at some later point. At leastthey are available, and they are available to theCommittee to consider before you publish your report.I note that the Committee had to publish a report on

Mr Virendra SharmaChris SkidmoreDavid TredinnickValerie VazDr Sarah Wollaston

spending yesterday that expressed views on thequality, innovation, productivity and prevention plansand their credibility before they had been publishedby the Department. I hope that all the evidence willbe available to the Committee before you have topublish your report on this occasion.I am very glad to be able to say a few words aboutwhat we are publishing today—almost literally inthree minutes’ time—to Parliament, and which youreceived earlier this morning. First, there is theresponse to the consultation on the White Paper andthose documents published in late July, on which weasked for responses by October. That document,Liberating the NHS: Legislative framework and nextsteps, sets out how we propose not only to respond tothe points made in consultation, but to take forwardthe policy for the Bill. To that extent, although theBill is planned for introduction in January, the policyfor the Bill is in the response published today.We are also publishing today The OperatingFramework for the NHS in England 2011/12 and theallocations to primary care trusts across England. Inmy view, the three documents collectively give aplatform for improvement in the NHS, a platform fordevelopment during the course of 2011–12, and aplatform for the reforms generally for the service topursue.Liberating the NHS: Legislative frameworks and nextsteps sets out in particular our conclusion that, on thebasis of the response to the consultation, we reaffirmour commitment to deliver reforms on the basis of theprinciples that we established. There was very widesupport for the principle of greater patient control oftheir own care. The principle of “no decision aboutme without me” was set out very clearly in the WhitePaper and has been widely supported. Indeed, I wouldsay that it has been embraced across the NHS,literally, over the past few months. There is a greatdeal of work to do and further consultation is stillunder way on the information that needs to besupplied to patients to hold the NHS fully to account.Another consultation is still under way on howpatients can exercise greater choice. None the less, theprinciple in the White Paper was very widelysupported.On the second principle, our ambition to achieveoutcomes at least as good as anywhere in the worldwas also very strongly supported, particularly the



15 December 2010 Rt Hon Andrew Lansley CBE MP, Dr David Colin-Thomé OBE and Dame Barbara Hakin DBE

structure of the new framework of outcomes for theNHS. If we want to deliver the best possibleoutcomes, we need to focus on them and have aprocess to measure them. Of the 6,000 responses tothe White Paper consultation, some 800 werespecifically related to the draft outcomes framework.I think that when anybody sees the draft outcomesframework, which we hope to publish beforeChristmas, they will see that it has enabled us to breaknew ground in capturing a representative set of realoutcomes for the NHS on the basis of which theservice will properly hold itself to account. Theservice will be held to account not just by the public,but by those inside the service. People will see theseas clinically relevant outcomes that are a proper basisfor clinical peer review and clinical governance. Ithink, in its breadth and detail, that this is somethingthat has never previously been attempted by otherhealth care systems. So this is ambitious, and we makeno bones about that.Thirdly, the principle is that the service should beprofessionally led, that it should be decentralised, andthat decisions should be made as close to patients aspossible by front-line clinicians. As a consequence ofthat, we wish to increase the autonomy of health careproviders, creating a more independent structure. Thatis reaffirmed in the Command Paper, as is thedetermination to move towards GP-ledcommissioning consortia at a local level and towards amuch enhanced and stronger role for local authorities.There are clearly issues with the implementation andthe process, on which good points were made in theconsultation. If I may, I will run through some of themain enhancements and adaptations to the proposals.First, we have decided to strengthen further the roleof health and well-being boards in local authorities,not least through a new responsibility to develop ajoint health and well-being strategy spanning theNHS, social care, public health and, potentially, otherlocal authority services. Local authorities and NHScommissioners will both be statutorily required tohave regard to that.Secondly, HealthWatch England is to have a distinctidentity as a statutory committee within the CareQuality Commission. There were people who felt thatHealthWatch England should be entirely separate fromthe Care Quality Commission, but the conclusion wereached—there was strong support for this in theresponse—was that the powers and responsibilities ofthe Care Quality Commission are in themselves veryimportant and, overall, that HealthWatch Englandcould play a stronger role, particularly at a nationallevel, by being able directly to influence the way inwhich the Care Quality Commission goes about itsquality inspection and enforcement tasks.Thirdly, we will increase the transparency ofcommissioning by requiring all GP consortia to havea published constitution. I should emphasise that wewill not prescribe the nature of those internalconstitutions.We have taken on board all the views expressed and,on balance, have concluded that, contrary to ouroriginal proposal, maternity services should becommissioned not by the NHS Commissioning Board,but through the GP-led commissioning consortia.

We intend to extend councils’ formal scrutiny powersto cover all NHS-funded services. Again, contrary towhat we initially stated in the White Paper, localauthorities will be given freedom to determine howthose scrutiny powers should be exercised. Many localauthorities have taken the view that they wish to haveindependent scrutiny in other areas, and in health andsocial care, too. There will also be a phased timetablefor local authorities to take on responsibility forcommissioning NHS complaints advocacy servicesand for giving them more flexibility over from whomthey commission complaints advocacy services.We will give GP consortia a stronger role insupporting the NHS Commissioning Board to driveup quality in primary care. Many respondents,especially GP consortia themselves, wanted astrengthened role for consortia in relation to theirpractices in quality focus. We will create an explicitduty for all arm’s length bodies to co-operate incarrying out their functions, with a new mechanismfor resolving disputes between those bodies.The context of all that, as the Committee willremember, is that recently the first wave of GP-ledcommissioning consortia responded to the invitationto become pathfinders. I issued the invitation in thesecond week of October, I think,1 and by the end ofNovember, a significant number had put themselvesforward. Of those, 52 have become the first wave.They represent, collectively, 1,860 practices and 12.8million patients, which is a quarter of the country. Tobe fair to them, there are many consortia that, in everyreasonable sense, are as well-developed; it’s just thatthe timetable for them wasn’t quite the same as theinitial first wave.To a large extent, I would say that, today, not only arewe publishing the Command Paper in a way that isclear about the policy for the Bill, but we are seeingmuch more of a transfer to the service of theresponsibility for shaping the reforms, and we aredoing so from the bottom up rather than top down.Some two dozen local authorities have expressed aninterest in being trailblazers for the establishment ofnew health and well-being boards in anticipation ofthe new statutory arrangements.Through The Operating Framework, we are giving anopportunity for the service to be clear about how themanagement of transition and the introduction ofreforms are going to work together. I think wediscussed previously, when I was last here, that,through The Operating Framework, we are going tobe clear in 2011–12 that PCTs will be clusteredtogether. That will do two things, essentially: it willcreate a source of financial and managerial controlwithin the service to assure ourselves about qualityand financial accountability during the transition; and,at the same time, it will give space for the GPcommissioning consortia. The PCT clusters will notfulfil all the day-to-day responsibilities of theirconstituent PCTs. They will meet their statutoryresponsibilities and the control responsibility, but theywill also facilitate the devolution of commissioningactivity alongside GP commissioning consortia in2011–12.1 Note by witness: It was on 21 October.




We now stand at the prospect of having, through TheOperating Framework, the commissioning consortiareally actively engaged in 2011–12 in shaping thesystem of learning from each other, in the learningnetwork that Barbara and her colleagues are puttingtogether, and also in what is being done through, forexample, the Royal College of General Practitionersand its centre for commissioning, and the NationalAssociation of Primary Care and others, which isgoing to enable that to make a lot of progress.There are details in The Operating Framework thatare probably not specifically what you want to discusstoday, which relate to how we are going to makefurther progress on key priorities such as reduction ofinfections—hospital and health care-acquiredinfections—the elimination of mixed-sexaccommodation, the emphasis that we place onveterans’ health and support for service personnel, theimplementation of the dementia plan, theimplementation of carers’ breaks, the introduction ofthe health visiting implementation plan and thedoubling of family nurse partnerships. Those are allset out in The Operating Framework.We have also now published the allocations to primarycare trusts. In total, there is a £2.6 billion cashincrease in 2011–12 over 2010–11. That represents a3% average increase across England in the cashavailable to the NHS next year. The individualprimary care trust increases vary from a minimum of2.5% to a maximum of 4.9%. Of course, this isachieved not least by our being very clear aboutholding down management costs, the costs of arm’slength bodies to the Department itself and the centralbudgets that we control. This gives a pretty strongplatform for 2011–12 for the reforms.Of course, in addition to that, as you observed in yourreport published yesterday, there is a great deal ofscope and, indeed, necessity for the generation ofsavings through improved productivity, efficiency andquality gain inside every part of the service, whichwill, I hope, enable us next year not only to meetdemands, but to improve the service that we offer.Chair: Thank you very much.If I may, I encourage the Committee to focus thismorning’s discussion on the commissioning inquiry,which is our current concern. As I said at thebeginning, I think that members of the Committeewould like to question you in general about whatyou’ve said in relation to commissioning, and then wewill move on to specific questions arising from thematerial that we had available to us before thismorning.Which member of the Committee would like to gofirst? Valerie.

Q495 Valerie Vaz: Thank you. Secretary of State, Iam pleased that you have mentioned the report, and Ihope you take it on board in any of yourconsiderations. I think it’s fair to say that the NHS isfacing a number of challenges. One has been dubbedthe Nicholson challenge, then, as far as I’mconcerned, the White Paper is clearly the Lansleychallenge, and we may yet face a third challenge,which is the Letwin challenge. Focusing on theNicholson challenge—this £20 billion-worth—I

wonder if you could tell the Committee how you aregetting on with that. Is it being delivered?Mr Lansley: The first thing is that there is a slightmisconception around the idea of the proposal—or theintention—that there should be between £15 billionand £20 billion of savings achieved within the NHS.That was not initiated by me; it was initiated beforethe general election, with a view to its implementationbeginning in April 2011. To that extent, asking “Howis it getting on?” is misplaced, because technically ithasn’t started. Everybody in the NHS is preparing toachieve this degree of efficiency savings.There have, of course, been substantial changescompared with when that was first promulgated. Itwas promulgated on the basis that £15 billion to £20billion was a range, depending on whether the NHSwas going to receive a flat cash settlement or a flatreal settlement in future years. Essentially, the £15billion was over three years under circumstanceswhere there was flat real, and the £20 billion wasunder circumstances where there was flat cash.David Nicholson, who was with me last time we werehere, explained that a number of things havechanged—and changed positively—since then. First,through the spending review, the NHS has had asettlement that is in excess of real terms. To thatextent, we are on the more favourable scenarios forfinancial support for the NHS. What we have done,however, is not to confine ourselves—the spendingreview was not over three years; it was over four. Theintention of the efficiency gain is now stretched overa four-year period, and therefore we did not revert tothe original £15 billion figure but have sustained the£20 billion figure over four years. In addition, acrossthe public services, a pay freeze in the first two ofthose four years has been agreed. That, in itself, willdeliver something approaching 10% of the overallsavings that are required. I have made it clear, and weset it out in the spending review, that we would reducein real terms the total administration costs of the NHSby £1.9 billion by 2014. That will deliver 10%.You are aware, and you said in your report, that thereare continuing requirements for efficiency savingsthrough the operation of the tariff. I won’t go on atlength now about how we can further develop andimprove payment by results, but one of its purposes—only one—is to deliver continuing efficiency gain andproductivity gain in the hospital sector. That isprobably equivalent overall to between one third and40%—I think it is between £7 billion and £8 billionof the total £20 billion savings. How that is achievedwill vary from place to place. The point of the QIPPprocess is to equip—if you’ll forgive the pun—peopleworking in health care services with a substantialrange of opportunities as to how they can do that. I amsure that you will have looked at the QIPP website, forexample, for the breadth of ideas on how the servicecan improve productivity, reduce cost and improvequality. The Better Care, Better Value programme isalready achieving that. It’s true to say that, at themoment, in this year the hospital sector in the NHS isachieving, on average, 3.5% efficiency savings. Weare looking for that to rise to 4%. The sector is doingthat while sustaining quality and, in many respects,improving the quality of what is being provided.




I think your report did say this, but the critical areabeyond that—that needs to be done, but beyond that—is the achievement of improved services in primarycare through improved commissioning andcommunity services. Of course, the reform process iscentral to that. I don’t think that, in the past, we’veachieved what was possible in terms of improving themanagement of long-term conditions and thedevelopment of community services. It’s not justaccess to services for people in the community; it’stheir ability to have the right care at the right placeat the right time, as well as reducing avoidable andunnecessary hospital admissions and high-costprocedures, and so on. In the QIPP process, that is asubstantial part of what needs to be done, and I thinkthe development of GP-led commissioning consortiais central to that. One of the criteria that all thepathfinder consortia were asked to meet when comingforward in the first wave was that they were alreadyengaged in developing that.

Q496 Valerie Vaz: I am really sorry to interrupt you;I know that time is short, and I am trying to keep myquestions as brief as possible. Did I understand youcorrectly when you said of the £15 billion to £20billion Nicholson challenge that nothing had beendelivered yet, nor is it intending to be?Mr Lansley: Well, the point is—

Q497 Valerie Vaz: Is that yes or no?Mr Lansley: You can either have a proper answer, oryou can have a yes or no answer. The answer is—

Q498 Valerie Vaz: Is that not a proper answer—yesor no?Mr Lansley: It was only ever intended to start—

Q499 Valerie Vaz: You either know or you don’tknow.Mr Lansley: The point is that it was only everintended to start on 1 April 2011. That does not meanthat in 2010–11 there is no efficiency gain.

Q500 Valerie Vaz: But I thought you said the QIPPprocess was getting it going. You said it started underthe previous Government.Mr Lansley: But if you want a formal answer to thequestion, “Has it begun?”, no, technically it has notbegun. It starts on 1 April 2011.

Q501 Valerie Vaz: So let’s move on to the cost ofreorganisation—the Lansley challenge. I have tried anumber of times to ask you this question on the Floorof the House. Do you have a figure for the cost of theWhite Paper reorganisation?Mr Lansley: When we were here last, we said twothings. First, we said that we know that there arecertain associated costs, not least with redundancy andthe reduction of management inside the NHS, and thatthat is nearly £900 million. We know that the recurrentsavings to the NHS are such that that cost is more thanrecouped within two years, and subsequent recurrentsavings flow from that. To that extent, we have madethat clear. Beyond that, there will be further costs, but

they will be reflected in total in the impact assessmentthat we publish at the time of the Bill’s publication.

Q502 Valerie Vaz: Okay, pretend I’m stupid—and Iam this morning because I woke up really early—butjust give me a figure. Other people have put it between£2 billion and £3 billion.Mr Lansley: I don’t recognise that figure.

Q503 Valerie Vaz: So what figure do you recognise?Mr Lansley: As I said, we will publish an impactassessment when the Bill is published.

Q504 Valerie Vaz: But surely you must know now.Mr Lansley: We will publish an impact assessment. Iam not going to publish a single figure now on thebasis of—

Q505 Valerie Vaz: You must have a clear idea ofhow much it will cost.Mr Lansley: I have a very clear idea, but I willpublish an impact assessment when the Bill ispublished.

Q506 Valerie Vaz: How do you know—you areasking people to make savings, and you don’t knowwhat the figure is?Mr Lansley: I’m not asking people to make savingson the basis of that figure—

Q507 Valerie Vaz: You are.Mr Lansley: The QIPP programme is asking peopleto make savings. We are very clear about the reductionin management costs that we are looking for, and weare very clear about the policy and the basis on whichpeople will make progress. Once the policy has beenpublished, the task of the Department is to publish afull impact assessment that looks at all those impactsand measures them. And we will publish that whenthe Bill is published.

Q508 Rosie Cooper: So when will we get the Bill?Mr Lansley: It will be introduced in January.

Q509 Rosie Cooper: It will definitely be introducedin January.Mr Lansley: A written ministerial statement todaysays that we plan to introduce it in January.

Q510 Mr Virendra Sharma: After how long willyou give us the figures?Mr Lansley: I intend to publish an impact assessmentwhen the Bill is published.

Q511 Valerie Vaz: Just going on to something veryimportant, I know that people do not like the NationalAudit Office, but there is an obligation—Mr Lansley: Who doesn’t like the National AuditOffice?

Q512 Valerie Vaz: I have heard on the Floor of theHouse that people think that—well, it has beenabolished anyway.Mr Lansley: No, that is the Audit Commission, whichis going to be abolished.




Q513 Valerie Vaz: Oh, yes; sorry. Well, yes, it’sgoing to be abolished. So there is a duty—Mr Lansley: I actually have the greatest respect forthe health work of the National Audit Office.

Q514 Valerie Vaz: Can I finish my question? Youalways interrupt me. I’m sorry; I hope I don’t interruptyou, but we don’t often get a chance to talk like this.There is a duty, and I think it’s clear that this is asignificant reorganisation of the health service, isn’tit?Mr Lansley: It is a significant reorganisation in themanagement of the health service, yes.

Q515 Valerie Vaz: A significant reorganisation with£80 billion going to GPs, and there wasn’t actually anelectoral mandate for that, but anyway.Mr Lansley: Sorry, am I allowed to interrupt you?

Q516 Valerie Vaz: No, you’re not, until I havefinished my sentence. Have you actually presentedanything to Parliament indicating what the outcomeswill be in terms of the positive outcomes of thereorganisation, so that there can be some sort ofmeasure?Mr Lansley: Two things. First, I have explained tothe Committee previously that the shape of the NHSreforms was indeed the product of the coalitioncoming together and bringing together with benefit tothe reforms overall our Liberal Democrat colleagues’intention that there should be stronger democraticaccountability in the NHS. I think we have not onlyincorporated that, but used it positively to engagelocal authorities more fully strategically in integratinghealth, social care and health care. That is very muchto the benefit of the reforms overall.Strictly speaking, from the Conservative party’s pointof view, it is not true to say that there is no electoralmandate for GP-led commissioning consortia. Thereis an explicit mandate set out in our manifesto to dothat.

Q517 Valerie Vaz: It’s not a ConservativeGovernment; it is a coalition Government.Mr Lansley: No, no; I did just say that. The reformprocess as a whole combines elements of what wesaid in our manifesto and elements of what the LiberalDemocrats said in their manifesto, and indeed theworking out of those collectively differs from thosetwo component parts.Valerie Vaz: Okay, in terms of the National AuditOffice.Mr Lansley: In terms of the outcomes, from my pointof view, the outcome that matters is the outcome forpatients. We have already made clear in TheOperating Framework how we want to see furtherimprovements today for the next year in some aspectsof the priority quality of services for patients. We willset out before Christmas the draft outcomesframework, which we hope, in 2011–12, will be abasis on which the NHS begins to orientateprogressively towards those results. From the point ofview of how the commissioning consortia interactwith that, we will need to go through a further processof consultation as to how this structure of outcomes

for the NHS as a whole is also, in particular, relatedto a structure of outcomes that supplements what is inthe quality and outcomes framework for generalpractice.

Q518 Valerie Vaz: So you didn’t present it toParliament, and we don’t have the benefits by whichwe can measure how good it is.Mr Lansley: We published a draft—Valerie Vaz: I mean, it may be good. The Lansleychallenge may be good; we don’t know. But is thereanything we can measure it by that has been presentedto Parliament?Mr Lansley: As I say, The Operating Framework setsout some specific intentions in terms of continuingimprovement in the service to patients. The outcomesframework we will publish before Christmas will gofurther in that direction.Chair: Can I interpose in this dialogue? Mr Morris.

Q519 Grahame M. Morris: Thank you very muchindeed, Chair. Arising out of those questions that mycolleague has just asked in relation to the documentsthat have been published on The OperatingFramework and your earlier statement, clearly hugeorganisational changes are being implemented. Thereare concerns that that might have a destabilisingimpact on the service, which in turn may welladversely affect outcomes. I have heard it said thatdestabilisation of the system is the enemy of reformand, clearly, it is not in anyone’s interest to see thathappen.We have seen reports as well, Secretary of State, aboutthe fact that Oliver Letwin has been drafted in andasked to review the reform plans. We have heardreports that there are mounting concerns at theTreasury, and possibly in Downing Street, over theimplementation. I would be interested in your viewson what Mr Letwin’s role is and what impact that’slikely to have in terms of the timetable and the plansthat are before us.Mr Lansley: Well, Oliver Letwin is the Minister forGovernment policy. This policy is one of the mostsignificant and hopefully most beneficial andimpactful of Government policies. So he is engagedin the process of the formulation of Governmentpolicy; it would be surprising were he not. Today wehave published, in Liberating the NHS: Legislativeframework and next steps, a document on behalf ofthe Government that sets out the Government’s furtherintentions in relation to the reform process.

Q520 Grahame M. Morris: Is Mr Letwin’sappointment, or the announcement of his appointmentand the work that he is doing in relation to the healthreforms, significant at this stage?Mr Lansley: I’m sorry; I’m not aware of anyannouncement.Grahame M. Morris: Well, it was a report in theFinancial Times on 30 November.Mr Lansley: Oh I see. Ah, so that won’t be anannouncement, then?Valerie Vaz: Well, you didn’t announce anything else.Mr Lansley: When we shape Government policy, wedo it collectively. I seem to be in a position where on




the one hand people are saying, “Oh, but it’s theLansley challenge.” It’s not; it’s the Government’schallenge. It’s not me alone; it is the Government,together. We are not only a coalition Government—

Q521 Valerie Vaz: The Prime Minister said he didn’twant any reorganisation.Mr Lansley: We made it very clear that we weren’tgoing to have a major top-down reorganisation. Thatwas not our intention. But actually when we lookedas a coalition at how we could deliver in all thesecircumstances the reforms that were required,including the authority and the responsibility in thehands of clinical leaders—and with our LiberalDemocrat colleagues genuinely empower localgovernment in a way that we hadn’t, from our pointof view as Conservatives, intended originally to do—I think that strengthened the process. I think itstrengthens the reforms. The response from localgovernment to the White Paper has beenoverwhelmingly, almost without exception, verypositive both in relation to the public health and theirrole in NHS commissioning. It has taken us to a newplace.It is very easy to overstate the impact on the NHS.When you think about people working in generalpractice, community services or hospital services, theprocesses of NHS reform that impact on them areprocesses that already existed. It is just that we aremaking them consistent and impactful where theyweren’t before. Practice-based commissioning existed,but it didn’t really have the benefits or the impact itwas intended to have. We are going to make thathappen. Transforming community services was aprocess started under the Labour Government, but weare going to make it happen. The translation of allNHS trusts into foundation trust status was somethingthat was announced by a Labour Government in 2005and was intended to be implemented by December2008. We are going to make it happen.I make no bones: there is a reorganisation of themanagement of the NHS. That, frankly, would havehad to happen anyway. When you look at the financeof the NHS, we cannot carry on spending £5.1 billionon administration. Some of what Mr Morris says isdestabilisation is, frankly, simply the inevitableconsequence of reducing the management overhead tothe NHS by 45%.

Q522 Grahame M. Morris: It’s rather more thanthat, isn’t it? The switch to GP commissioning as amethod of commissioning services is rather more thana tweak that would have happened anyway. There isan argument for a more evolutionary system inrelation to the existing PCTs; this is quiterevolutionary.It was interesting yesterday; I was at the seminar oncancer services, “Backing Cancer”. It was very wellattended, with more than 350 delegates. Just as a bitof feedback—because I am not sure whether you werepresent for the earlier session—when delegates, froma wide range of charities and specialist patient groups,were asked whether they thought that the newcommissioning arrangements with GPs would assistin improving outcomes, I would suggest that three

quarters of them thought that it wouldn’t. I thoughtthat that was quite significant. There wasn’t any kindof doubt in their minds. There is quite a job to do topersuade people that it is going to improve outcomesfor patients.Mr Lansley: Well, perhaps I’ll ask my colleagues toadd a bit on this. Let me just say, because I was thereto hear some of the session—indeed, not all of it—and spoke to the Britain Against Cancer conferenceyesterday, that I have been to those conferencespreviously and one of the central issues, including thereport of the National Audit Office, was that cancerservices suffered not least from weaknesses incommissioning. So we are not in the place we need tobe. We are not in the place we need to be in terms ofoutcomes for cancer, and I won’t go on about that, butI was actually very surprised at people there yesterday.Positively, they said that they overwhelminglysupported the focus on outcomes and the structure ofthe outcomes framework that is in the White Paper.They clearly don’t understand how the clinicalleadership of general practice coming together locallycan actually give us a stronger place in terms ofmanaging care on behalf of patients, including cancercare. I think they understand that specialisedcommissioning is the responsibility of the NHSCommissioning Board. It is worth my colleagues—Barbara first, then David—speaking about how GPs,collectively, can improve the quality ofcommissioning.Dame Barbara Hakin: I’ve gone round the countrytalking to a lot of patient groups and otherstakeholders about the changes. One of the things thatstruck me, perhaps, is the misconception about howthe system worked before, which actually makes someof this look more radical. I think that people did notunderstand that primary care trusts, which are basedon primary care and have clinicians involved as partof them, actually received the vast majority of thefunding for all NHS services, and that thoseorganisations were responsible for working togetherand not only doing the clinical design of services, butthen going on and contracting them. So I think thatthere are a lot of people who have been anxiousbecause they felt that the money went directly to thehospitals and that now it is going via the GPs.I have talked to a lot of people who have that view,particularly patient groups. They start to understandthat this is just a more clinically oriented way of doingthings with the people who will be more responsible.GP consortia will have really strong and goodmanagers supporting them in the same way that PCTshad good clinicians helping them. The clinical leaders,who understand the needs of their patients, will havemuch more of a say in the clinical design of thoseservices and the pathway from primary care tosecondary care for patients with all sorts of conditions.

Q523 Grahame M. Morris: I don’t necessarily agreewith your analysis. Yesterday, I participated in the all-party cancer group, where it was identified that in2007 the cancer strategy made a quantum leapforward with the design of the clinical pathways, theestablishment of the cancer care networks and so on.We were moving along the right track. This isn’t a




conversion on the road to Damascus; the generalconsensus is that we were moving positively in thatregard. There is an acceptance that, generally, theoutcomes are not as good as they should be. I acceptthat, and there is work for the Committee to do onthat.Mr Lansley: The truth of the matter, and we know it,is that in the period since the introduction of thecancer reform strategy, important and beneficial as theimprovements have been, the improvement in cancersurvival rates in this country is still no different intrend terms than that which preceded it, and it is nobetter relative to other European countries than in thepast. To that extent we need to close the gap in termsof outcomes, and we know that there are a number ofthings that we need to do.I have talked to the Committee about the cancer drugsfund, but, as I said yesterday, we also have to be muchmore aware of the signs and symptoms of cancer. Wehave to be much better at early diagnosis and havemuch better access to treatment at an early stage.Yesterday’s meeting of the all-party parliamentarygroup significantly understated the importance ofgeneral practice in doing that.Taking one example, lung cancer, when I have talkedto lung cancer physicians, as I have done at Papworthin my constituency, they feel very strongly that thereis a difference in practice between, for example,ourselves and France. The point at which patients arereferred to X-ray or other scans for signs andsymptoms of cancer is, on average, significantlyearlier in France than in this country. The essence ofthat is changing the practice in the community andhaving people identifying those symptoms. Generalpractitioners can make an enormous step forward ineducating their patients and making such referrals atthe right time.Dr Colin-Thomé: Could I just say two things? One ofthe reasons for the poor outcomes in this country isthe delay between symptoms and diagnosis, which islonger than most and has a big effect on outcomes.That may be about the public’s awareness, but it mayalso be that primary and community services requirebetter access to diagnostics to improve. The secondpoint is that you can’t give all of the credit tocommissioning, because those were national strategiesand the national directives are still continuing withthose guidelines.We are still doing poorly in cancer outcomes, despiteour improvements, and for care of the elderly we areactually going the other way; we are getting worse.As some 70% of people with cancer are over 65, thatis an indictment of our present system, which isn’tdoing the trick. We need to have a much greaterclinical focus. We have a lot to do, despite theimprovements, most of which came from centralapproaches, rather than local commissioners.

Q524 Grahame M. Morris: I don’t want to drive theagenda away, but I want to make one point that cameout of yesterday’s conference, particularly frompatient groups. GPs are perhaps diagnosing, onaverage, eight or nine cases a year. So there are issuesthere that need to be seriously addressed.

Mr Lansley: I think that, strictly speaking, they saidthat on average there are 250,000 new diagnoses ofcancer a year and there are 35,000 GPs. So there willbe some eight new diagnoses per GP across thecountry; it is not that they necessarily make thediagnosis. The point we were making yesterday wasthat, on average, those GPs might see 200 patientswho have potential signs or symptoms of cancer. Tothat extent, it is the response to those signs andsymptoms that is most significant.Dame Barbara Hakin: Can I make it very clear thatGPs will be the co-ordinators of commissioning andall clinicians will be involved in the clinicalpathways? This is not about GPs determining theclinical aspects of the complexity; it is about GPsusing their relationships with their colleagues andusing their clinical skills to bring that together in amuch more clinically based system.Chair: I am conscious that we are trying to get awayfor the beginning of Question Time at 11.30. We havean hour and a half left, and we haven’t yet startedseriously questioning the commissioning structure.Rosie wants to come in, and then I would like tomove on.

Q525 Rosie Cooper: Could I go back to what DameBarbara said about talking to patient groups about thescale of change? You imply, and the Secretary of Stateis reported to have implied, that concerns over timescale are exaggerated. As you just said, DameBarbara, people woefully overestimate the scale ofchange, because practice-based commissioning,choice of provider, NHS price list and foundationtrusts already exist. If that is all so exaggerated, why,after seven years, have so many NHS trusts that havegot off to a flying start compared with the consortiathat you are trying to establish in a very short timescale not become foundation trusts? If you have allthe building blocks and they can’t do it in seven years,how are you going to get commissioners off the—Mr Lansley: To be fair, Barbara is responsible forcommissioning development and the question you askis about the development of provider services withinthe NHS. We are shaping ourselves in the Departmentin relation to the future in the same way as we areasking people to do throughout the country, and thatis divided between the provider services and thecommissioning services. Barbara is responsible for thedevelopment of commissioning services.Let me answer that. You’re right: in 2005, a LabourGovernment said that every NHS trust should be afoundation trust by December 2008. That did nothappen. There were a number of reasons for that, butsome of them were policy reasons. The foot literallycame off the accelerator and in 2009 it went on thebrake. You can see more than 20 FTs going throughthe pipeline year after year until 2009, and thensuddenly it was a handful. We have restarted thepipeline and are working hard on it. There are about120 existing NHS trusts. To some extent, we areadding to the number of NHS trusts, becausecommunity services are turning into NHS trusts, sothe numbers will be slightly misleading. None theless, we have about 120 NHS trusts. I wrote to thechair of every NHS trust in late September and asked




them all to respond to me by the end of Novemberwith their own timetable, milestones and challengesin moving to foundation trust status. We are workingthrough that, but I can tell you, roughly, that at leasta third of those are clear about the timetable and willdo it. They are confident that they will be able to doso before 2014; some quite quickly.Another third feel confident that they will be able todo that, but they have specific challenges that theyneed to meet. They will come through towards the endof that period, because we need to tackle those. Thereis probably another third where we need to makesignificant changes in the configuration, managementor functioning of those NHS trusts in order to makethat happen. I won’t, for reasons of time andotherwise, go into detail about how we will do that,but much of it is literally, I promise you, about facingup in individual NHS trusts to problems that havebeen allowed to go on for too long.

Q526 Rosie Cooper: So why do you not think youare going to face that sort of scale of problem withconsortia? Why do you think you will just drive itthrough?Mr Lansley: Well, consortia are a completely differentpoint. I think that the essence of the development ofconsortia is that people talk about commissioning asthough it is something that GPs collectively don’tcurrently come together and do. They do do this.Rosie Cooper: Of course they do.Mr Lansley: So why would they not be able to?Frankly, there is a whole range of support availableto the new commissioning consortia as they establishthemselves. We will assign staff to the consortia fromwithin primary care trusts to enable them to establishthemselves. They can seek to use existing primarycare trust staff. From our point of view, there isabsolutely no intention that the reduction in staffingin primary care trusts should be so widespread that itexcludes managerial and expert staff in primary caretrusts from continuing to be responsible, but withinthe context of clinical leadership rather thanmanagerial control.

Q527 Rosie Cooper: So you would say that the NHSis not facing its Ark Royal moment where you havetaken a calculated risk that leaves the NHS withoutair cover and, I believe, risks the financial stability ofthe system. At this crucial time, what are you doing?You are making massive reductions in managementcosts. People are leaving all over the place. You haveyour headlines of train wrecks et al—someone else isgoing to ask about that. There is grave concern thatyou expect this to be driven through by people whoaren’t there.Mr Lansley: I don’t think that’s true for a minute.This is Barbara’s responsibility, so she might like toadd to this, but make no bones about it, we intend toreduce the number of management staff. We havebeen clear. We talked to you before about the mutuallyassured resignation scheme, and I think 2,200 staffhave left under the scope of that scheme. Because wepublished the Command Paper today and TheOperating Framework, it will also enable Sir DavidNicholson, Barbara and their colleagues to make clear

how the transition is to be managed. David will issuea letter to the service alongside The OperatingFramework that helps on that and the humanresources consequences.Essentially, it means that there are staff who willleave, and we accept that they will leave. That willenable us to reduce the overall administration cost, themanagement cost and the number of managers. Thenumber of managers in the NHS has been decliningsince earlier this year, and it is declining at a rate ofsome 600 or 700 over the course of the past sixmonths, which will continue.We will, however, maintain the quality-critical andservice-critical staffing. We will maintain themthrough the PCT clusters so that we don’t have to have152 teams all over the country. We will create spacefor the GPs. That will allow us then to assign staff tosupport the commissioning consortia. There are manystaff—you should not underestimate the extent towhich there are staff and leaders inside primary caretrusts who see their role in future as being alongsidethe GP-led commissioning consortia, withmanagement, yes, but with clinical leadership andmanagement working together rather than theseparation between clinical decision making andmanagerial decision making that has so characterisedthe service in the recent past.

Q528 Rosie Cooper: A very final, quick statement;almost yes or no would be okay. What you are sayingis that you can provide assurances that changes tomanagement arrangements at strategic healthauthorities and PCTs won’t lead to increased financialdifficulties and that, for example, waiting times willbe as good as they were when the coalitionGovernment came into power.Mr Lansley: Well, I encourage you to look at TheOperating Framework, which is absolutely clear.

Q529 Rosie Cooper: Waiting times won’t increase?Mr Lansley: The Operating Framework is absolutelyclear that the service will not only maintain financialcontrol, but continue to improve measures of service.

Q530 Rosie Cooper: Waiting times are currentlyincreasing all over the place. How can you give thatassurance?Mr Lansley: Have a look at The OperatingFramework. It talks about continuous improvement,including in waiting times.

Q531 Rosie Cooper: But the fact is that waitingtimes are increasing now—today.Mr Lansley: No, they’re not.Rosie Cooper: Yes, they are.Mr Lansley: No, they’re not.

Q532 Rosie Cooper: The evidence is that that is true.Chair: Evidence can’t proceed on the basis of, “Yes,they are,” and, “no, they’re not.”Mr Lansley: We have published the data.Rosie Cooper: The patients you’re supposed to belistening to will tell you it is increasing.




Q533 Andrew George: We had previously agreed anorderly process of questioning, and we seem to havelost that to a certain extent—that is not a criticism ofyou, Chair, I hasten to add.The role of Parliament ultimately, when the Billcomes before us next year, in making the big decisionsabout proceeding—or potentially not—and decidingwhether there should be any amendment to the Bill asit is presented, is clearly going to be critical. In thatregard, what we have before us is a product of a WhitePaper so far, leading to a Bill that has been variouslydescribed—by you as a logical reform. I think it isacknowledged as a challenge, and we have also hadreference to one PCT chief executive referring to it asa “bloody awful train crash” about to happen. I’m sureyou know about that particular chief executive andhe’s not alone, which I think is the important point—we are not talking about someone who is talkingalone. Certainly, evidence to this Committee,suggesting that that is widely reflected, is that it willinevitably cause, as he claims, organisational upheavaland staff demoralisation—I think that has beencovered—and it will also undermine the focus onpatient care and financial control. In respect of that,how do you respond to the fear that this will result insome awful catastrophe about to happen as a result ofhaving to save lots of money and achieve efficiencies,while at the same time going through verysignificant reorganisation?Mr Lansley: Well, I think it would be sensible forBarbara to add, but, from my point of view, I of coursenever expected that when we make changes, and inparticular when we make changes that involve areduction of 45% in the number of managers andsenior managers in strategic health authorities andprimary care trusts, those senior managers would allexpress themselves delighted at the prospect. It wouldbe unreasonable to expect that to be the case.What I would simply say to you is that Sir DavidNicholson and his colleagues in the NHS have set outvery clearly how we can manage the transitioneffectively. There will be people who don’t want to bea party to the management structures in the future, andwe will make arrangements for them to be able toleave, which would be part of the overall reduction inmanagement cost. There will be many others,however, who want to be part of that transition. I thinkthat Mr Creighton, who said those things, wants to bepart of the transition. He wants to be chief executiveof one of the north-west London PCT clusters. Thereare others who actively and positively want to be partof the new shape of commissioning in the future, andwe will make arrangements for them to be able to dothat, too, through assignment and the commissioningconsortia having a financial allowance to enable themto take on some critical staff to enable that to happen.What I would just say to you is that I have visited anumber of the pathfinder consortia. There is energyand enthusiasm among not only GPs, but the wholestaff, including often the primary care trust staff whoare working with them to make that happen. This istrue. You can go to Cumbria, and Sue Page is workingwith the GP consortia to make it happen. You can goto Bexley, as I did last week, and Anthony McKeeverand the PCT staff are critical to making this happen.

The energy and enthusiasm being generated in thoseplaces where the new consortia are being establishedis, in my experience, far in excess of the energy andenthusiasm for commissioning that was generatedinside primary care trusts.I have to say—I’m sorry, but it is a simple truth—that there is a world of difference between clinicalleadership and a focus upon how we can deliverimproving care for patients, and the enthusiasm thatis generated by people being given the freedom andthe authority to do that, as distinct from people whoare going through what is essentially more of amanagerial and bureaucratic process. The allying ofthose resources and responsibilities to this clinicalenthusiasm for delivering positive change isinstrumental in making commissioning work moreeffectively.

Q534 Chair: The Committee visited Hackneyyesterday, which, as I understand, isn’t a pathfinderconsortium, but there was similar enthusiasm for theprocess. Other issues will arise as well.Mr Lansley: Barbara and David will have seen manyother examples.Dame Barbara Hakin: Absolutely. I would like torefute the reflection of what I said earlier. I said thatwe need to ensure that we help the public,stakeholders and patients to understand what exactlyis happening in the reforms, but, in terms of themanagement through the transition, this is asignificant transition period for management change.It would have had to have been that level of change,because we are reducing management costs, and wehave to find a great deal of money actually to improveoutcomes for patients without an enormous uplift inthe NHS budget and with ever-increasing need.In order to do that, The Operating Framework andDavid Nicholson’s transition letter will make it clearthat, in forming PCTs into clusters and in the way thatwe work with PCTs to take us through from themiddle of next year through to 13 April, when thenew system is much more established, we willactually have a much more robust system workingthrough the cluster units and on to their PCTs. I thinkthat the PCT chief executive in question hassubsequently said that he feels that his words were illchosen to relay what he meant, which was that it wasabsolutely necessary that we create a transitionalinfrastructure to ensure that we have really good gripthrough that period.Dr Colin-Thomé: Can I just say quickly that you willalways get siren voices whenever there is change? Ofcourse, this particular group feels more embattled.You don’t get that much noise from clinical areas—including not only GPs but others—about the demiseof PCTs. There are plenty of PCTs, as Andrew hassaid, which have been very positive about thechanges, as we have described, because I have alsobeen to other places around the country such as TowerHamlets, Cambridge and Peterborough. Those havebeen doing it already, so you would expect the oddsiren voice.If you look, for instance, at your waiting times, wehave always driven these in the past by top-down, 18-week programmes, and so on. However, if you could




engage all clinicians, including primary care who areoften not involved, most of the care that’s done withour patients could be done completely differently—clinically, rather than a top-down approach. There aresomething like 40 million follow-up appointments ayear, which doesn’t seem to be the best use ofresources. Those redesigns will tackle some of thetargets, because of clinical involvement rather thansome mechanistic top-down approach to some ofthese changes.Chair: Mr George has a follow-up question.

Q535 Andrew George: Yes, it’s a follow-up questionto the question about it being Parliament which willdecide, because the Bill will come before Parliament.The issue is that a lot of this change is alreadyhappening—the pathfinders have already beenannounced. The Bill will be coming before us towardsthe end of January or February, and then it will bescrutinised by Parliament. Parliament will be makingits decisions after the event. On most of the decisions,it will be a train—whether it is a crash or not is adebating point—that has already left the station and isway down the track before Parliament has theopportunity to begin the process of expressing a view.On this issue, it is quite important to note that,Secretary of State, you say that the Government aremaking these decisions collectively. Well, collectively,they went into the coalition agreement saying thatthere would be no major top-down reorganisation.That is precisely what this is, and therefore, it shouldbe subject to significant parliamentary scrutiny. Thatscrutiny should be ahead of—instead of after—theevent itself, particularly in relation to the geographicalupheaval in terms of the boundaries. I don’t thinkanyone has any love for the quangos themselves—thePCTs, the unelected boards. Putting it in the hands ofclinicians is fine, but only one sector of clinicians willbe driving this commissioning process. There are a lotof debating issues, but we as a Parliament will beinvited to take part in the debate—in spite of thescrutiny now—very much after the event.Mr Lansley: I think that the criticism would be validif we were not, in truth, taking what is essentially anevolutionary process at the moment. We’re notactually anticipating, strictly speaking, in any sensethe introduction of the legislation; we are reorganisingprimary care trusts under existing legislation.

Q536 Andrew George: But the pathfinders havebeen announced. The train has left the station.Mr Lansley: With delegated powers under existinglegislation, we are creating—and I think we willdemonstrate—the opportunity for the development ofgeneral practice-led commissioning. That will—Ihope and I think—demonstrate how the generalpractice-led commissioning consortia can takeresponsibility, improve commissioning and improvethe services for patients. We are doing that underexisting powers. Of course, under existing legislation,if we went down that path, we end up trying to haveall three things: strategic health authorities, primarycare trusts and the GP commissioning consortia. Thatwas why we ended up—I was very clear, so I won’trepeat what I said before—with what was effectively

a managerial reorganisation of the NHS. I don’t thinkthat it is a reorganisation at the front line, but it isa managerial reorganisation in order to empower thefront line.We had to make a decision about that but, strictly,Parliament will make a decision on whether to leaveall these bodies in place or to accept, which I believeParliament will do, that it is better to devote resourcesto supporting the front line. It is better to give moreresponsibilities to local authorities for democraticaccountability than to leave them with unelectedprimary care trust boards. The Liberal Democratmanifesto proposed the abolition of strategic healthauthorities, and we are proposing that in thelegislation. These are things that I think will be theconsequential decisions made by Parliament, not leastbecause we are demonstrating, over the course of thecoming year, how the new shape of commissioning—and provision, for that matter—is capable of achievingbenefits for patients in the future.

Q537 David Tredinnick: Apropos train crashes, I amsure that we are all hoping that we will see the lightat the end of the tunnel and not the headlamp on theexpress train as it comes towards us—that’s the oldjoke.I would like to ask you a few questions about PCTclusters and commissioning, but, if I may, I want topick up on something that you said earlier. You’revery keen on the devolution of commissioning, but isthere not a contradiction here in that you’ve got thisCommissioning Board that will be more powerful thanany other commissioning board we’ve ever had? Doyou think that’s a fair statement?Mr Lansley: Of course the NHS CommissioningBoard has considerable powers—and necessarily so.In a national health service, we need clear nationalstandards and there needs to be a body that holds thecontracts with the individual practices across thecountry, and that would be the CommissioningBoard’s responsibility. GPs themselves take the viewthat this is the right way for it to happen. Strictlyspeaking, does it have more power than theDepartment of Health under the current system? No,of course not, because the Department of Health, asthings happen at the moment, pretends that there isdevolution of responsibility in different places acrossthe country, but, strictly speaking, it can control it all.

Q538 David Tredinnick: On the PCT clusters, whichare coming—this is going down to the devolvedpart—is there not, in a sense, a safety net as theprimary care trust organisation dissolves? Some partsof the country may lose a lot of employers. Is it not,in a sense, a circle of wagons to ensure that you canget through this phase in some sort of shape?Mr Lansley: If I may say so, I think that that is anentirely negative way of seeing what we regard as avery positive way of approaching this. We’remanaging organisational development byconcentrating resources in primary care trusts, so thatthe management resource is effective at deliveringfinancial and quality control, while creating space.That is space in terms of resources, commissioning




responsibilities and budget management, so that thecommissioning consortia can establish themselves.

Q539 David Tredinnick: Yesterday at Hackney, I gotthe impression that there were savings that could bemade through restructuring, certainly in the primarycare trust areas. At the end of the transition period, doyou think the clusters are going to be redundant? Ithink Sir David said that at the end of the transitionit would be a matter for the Commissioning Board,“because the board get them from 1 April” 2010—Iam quoting him exactly.Mr Lansley: 2012. The clustering of primary caretrusts is a transitional measure. Subject to the approvalof Parliament, primary care trusts will be abolished on1 April 2013. We intend to establish the NHSCommissioning Board in shadow form during 2011,so, to that extent, the primary care trust clusters willbe a basis on which the NHS Commissioning Boardexercises its responsibilities as part of the transition.From 1 April 2013 onwards, the NHS CommissioningBoard will be able to make its own decisions on howit manages its relationship with commissioningconsortia across the country.

Q540 David Tredinnick: Going back to my safetynet, isn’t the reality that the board could quiteconveniently say, “Actually, we’re not going todismantle this framework”, so you’ll still have aprimary care trust skeleton report network going upto the Department? They won’t be disposed of and,probably, quite rightly, because you’ve got a lot ofskills there. The second part of my question is, arethey going to be able to support these new GPconsortia? Is there not a role for them to providesupport services to doctors who really don’t wantanything to do with administration?Dame Barbara Hakin: Absolutely. The clusters are atransition vehicle and a way in which we can bothsupport the GP consortia and also support the NHSCommissioning Board as it comes into being. PCTsare currently accountable to strategic healthauthorities, which will be abolished and disappear,and then all PCTs for the year of 2012–13 willaccountable to the NHS Commissioning Board. Bythat time, the NHS Commissioning Board will,through the creation of clusters, have a moreappropriate way to relate to PCTs.The board at that time will have to determine how itchooses to discharge its functions. Obviously, some ofits functions are national and are done once, but someof its functions are about relating to consortia. Someof its functions are the direct commissioning that itundertakes itself—say, of primary care. After it’sformed, the board can determine what shape it needsto best discharge those functions.The clusters will be there, in the board’s early days,to ensure that we have the rigour and grip that weneed, but it will be for the board then to choosewhether the cluster shape and the cluster distributionis something that it would want to use for the future.That will hugely depend on the size of the consortia,of course. Until we see the size and shape of theconsortia, it will be very difficult for the board todetermine what’s the right shape for it.

Q541 David Tredinnick: You talk about the boardchoosing. Sir David, when he came before us, saidthat there would be a need for central Stalinist controlsduring the transition period, and he didn’t sound likea very consensual individual. I got the impression thatthey were going to be told to get on with it. Do youthink that’s fair? “Stalinist controls” was the phrasehe used.Mr Lansley: If Barbara wouldn’t mind my adding toher comments, from my point of view, we havealways been very clear, and clear with the Committee,that during the transition, we are going to create spacefor the GP-led commissioning consortia to establishthemselves, and give them support to do so andengage them directly in improving quality anddelivering on the challenge in relation to quality,innovation and productivity. But at the same time, wehave to maintain financial control. We are asking theNHS, notwithstanding a 3% increase in cash nextyear, to enter a period during which the increases inresources for the NHS are not what they have beenpreviously. We are entering a period when there isgoing to have to be continuing improvement in thequality of service in a time of financial constraint. Tothat extent, we’ve always been very clear. There is acombination: the service will experience tight controlsof financial management and performancemanagement, while at the same time building thecapacity of the front-line commissioning consortiaeffectively to take over responsibility.

Q542 David Tredinnick: So we’ve got theNicholson effect; we’ve got the Letwin effect; andnow we’ve got the Joseph Stalin impact. Is that right?Mr Lansley: The Committee seems very keen onattributing names to these things. It is theGovernment’s policy, and the Government arecollectively responsible for it.

Q543 David Tredinnick: I have one last seriousquestion, which is about the strategic healthauthorities’ role. The White Paper says the SHAs have“a critical role during the transition in managingfinance and performance”, but they are to be abolishedin 12 months, before the new system is operational.Why is this, and which body, if any, will take on thisrole in 2012–13?Dame Barbara Hakin: The NHS CommissioningBoard will come into being as the SHAs are abolishedand will take on responsibility for overseeing thePCTs, which will be accountable to it, and the growthof the consortia during the year, at the end of whichPCTs will be abolished. The final state is a devolvedsituation with a lot of local leadership and freeing upof the front line to make the changes that we know itwants to make, but it is clear that as you go throughthe transition, it is really important to be very clearand to have clear direction. That was what Sir Davidwas saying—particularly over the next year, we needto be very clear about how the system operates in thetransition in order to put the NHS CommissioningBoard and the new structures in the right place whenthey come into being in 2012.Mr Lansley: And, to be fair, the enthusiasm of theGP commissioning consortia is very much focused on




being able to engage with clinical services, being ableto design services and being able to improve services.They have a concern, which we completelyunderstand, in that they don’t want to be in a positionwhere they are given control of finance at a pointwhere they can’t understand the nature of what they’recommissioning and how they’re commissioning it,and where they can’t shape it, they can’t shape thecontracts. From the general practice point of view, theprocess is to think about clinical care and improvethat, shape the contracts with providers so as to beable to have the framework of commissioning thatyou’re looking for, and then put a financial controlmechanism alongside it. We’re trying to make surethat through the transition, they are confident that thatfinancial control mechanism is in place and isavailable for them to see at the point at which theytake responsibility.Chair: We will now have a short question fromNadine and then go to Dr Wollaston.

Q544 Nadine Dorries: This question is on the backof the SHA question and is probably for Dr Colin-Thomé. Can I first say this to you: Liverpool,Runcorn—1980?Dr Colin-Thomé: Yes, I was a GP in Runcorn.

Q545 Nadine Dorries: We knew each other in adifferent life. This question is for you, then. Wherewill Jim Easton’s responsibilities for driving quality,innovation, productivity and prevention reside? Andwill GPs be expected to pick up the cost of this,particularly in terms of new technologies andinnovation?Dr Colin-Thomé: Once the NHS CommissioningBoard is, it will have to decide who is going to bewithin that board, including some of the QIPP work.But if you look at the GP organisation, consortia andthe pathfinders we’ve put in place already—and thereis more to come—that redesign is at the basis of theirenthusiasm. They feel that the present structures havenot allowed that enthusiasm to flourish and reshapecare, because it is clinicians and especially doctorswho spend the money, as I said before. The GP leadershave lots of ideas, all of them, about how we canreshape care around the varying lengths of stay wehave in hospitals or the follow-up outpatients, and theneed to actually refer in the first place. Thatfundamental reshaping will make a difference tofinancial control. That is what QIPP is about. I thinkyou will find that, with GP leadership, they’ll have agood vehicle out there that maybe the presentarchitecture hasn’t been so good at.

Q546 Nadine Dorries: And will the financialprovision be available within that vehicle? Will theybe able to afford to do this?Dr Colin-Thomé: If we are going to be allowed—aswe are, and that’s not just the 3% growth but the factthat, whoever’s challenge this is, we can reinvest the£15 billion to £20 billion—then it is up to us to releaseresources for that. The 3% growth, especially ifconsortia and pathfinders are allowed to flourish as wethink they will, will mean that we can use that growthmuch more imaginatively now. There is lots of money

in clinical care, around ineffective care, care of lowervalue and the way that we organise care, which ishugely inefficient at the moment. Clinicians havenever had a vehicle, until now, to be able to challengewhat we do and to make it for the better. We will beable to release the money as we go along, because weknow there is lots of money that we are not spendingas appropriately now.Mr Lansley: I understand that you won’t have had anopportunity to read The Operating Framework, but ifI could just draw to your attention that we are clear inthe transition that there will be a small allowance forthe pathfinder consortia during the course of 2011–12.Creating space will include generating managementsavings through primary care trusts that are availableto the consortia.We said in the revision in June that we will set outhow resources will be released from the infrastructureand running costs of strategic health authorities andPCTs in order to provide a running cost allowance forGP consortia. The Operating Framework , inparagraph 5.16, goes on to say that our “expectationis that GP consortia will have an allowance forrunning costs that could be in the range of £25 to£35 per head of population by 2014/15. We will notdetermine the exact amount until further work hasbeen undertaken with pathfinders”. So we will use2011–12 to identify what is required in order to be thesupport for the commissioning consortia. I quote:“This work will explore the optimal balance betweeninsuring sufficient investment in organisationalsustainability with maximising resources for front lineservices. Before this, during their development phase,the running costs will be locally agreed within therunning cost envelope for each region.”Dr Colin-Thomé: And currently in London, forinstance, the idea of clustering PCTs has releasedmoney to allow the pathfinders to have a bit of money,even now, to develop the ways that we were talkingabout. I believe that the clinical challenge of the waywe organise our care will make a significantdifference, especially if those clinicians are helpingcommissioning.Chair: I am going to restrain Sarah, if I may, just forone more time, because I know Chris wants to comein on management first.

Q547 Chris Skidmore: I wanted to bring that up. Imanaged to pick that up from The OperatingFramework. In a previous session, Kingsley Manningfrom Tribal told us that he thought a maximummanagement allowance could work on £5 to £7 perhead. We have also known from previous experiencethat primary care groups have operated on £3 per headfor a management allowance. Do you not feel that £25to £35 is actually, in the words of Sir DavidNicholson, “remarkably generous and…that peoplewill be shocked by the size of it”? The Governmentare attempting to reduce management costs—Mr Lansley: Sir David hasn’t said that about thisfigure.Chris Skidmore: He has, on 18 November, to theNHS Alliance conference.




Mr Lansley: No, no. This figure is published in TheOperating Framework, so he won’t have beenreferring to that then.I understand the point you’re making. There is afundamental discontinuity between the way in whichpeople have expressed the figure for managementcosts in the NHS, which was used widely but actuallyonly ever measured the salary cost of managers andsenior managers. What I am referring to is not thatmanagement cost; it is a running cost total, so it is ineffect the total cost of administration of anorganisation—everything that is not the provision ofservices to patients. So, to that extent, it is adifferent calculation.At the moment, therefore, what are we comparingwith? What’s the baseline? The baseline on runningcosts across the Department, arm’s length bodies,strategic health authorities and primary care trusts is£5.1 billion. I’ll happily let you know—I think,broadly speaking, about £3.5 billion of that would bethe running costs of primary care trusts at the moment.So the figure, the range that we’ve expressed in TheOperating Framework, is entirely consistent withbringing the administration cost of commissioningdown in exactly the way that we previously said inthe spending review.

Q548 Chris Skidmore: You don’t think it can be cutany further.Mr Lansley: No, to be fair, the point we’ve made inThe Operating Framework is that we set a range thatis consistent with reducing the overall administrationcost very dramatically, from where it is with primarycare trusts at the moment; but the actual figure will bebuilt up from the bottom up, rather than top down.Chris Skidmore: On that point, I see in paragraph5.17 that you’ve said that “in line with NHSfoundation trust reporting, NHS trusts will no longerbe required to report on management costs.” Will GPconsortia be required to report on management costs?Mr Lansley: On running costs, yes, they will.

Q549 Chris Skidmore: And will that be in part ofthe constitution?Mr Lansley: The commissioning organisations will—because they are using public funds—at every pointin the system, on the commissioning side, in their useof public funds have a running cost limit directlyapplied to them. Hospitals, of course, have a budgetto provide a service, and it’s up to them how they usetheir budget.

Q550 Chris Skidmore: But if they undercut thatlimit will those figures be published annually? I noticein your written statement you’re requiring all GPconsortia to have a published constitution. Will thatbe part of that constitution?Mr Lansley: Yes, as part of the accountability, theywill publish their use of resources, including theirrunning cost total for that year.Dame Barbara Hakin: Plainly, if they wish to useless on running costs and more on patient care thenthat would be within their gift.

Q551 Chris Skidmore: The discrepancy betweensomeone like Tribal, saying they could do it for sevenquid a head, compared to—Mr Lansley: I think, to be fair to Tribal, whenKingsley Manning was saying that to you he wouldhave been using the comparison with managementcosts that was used in the NHS, not the total runningcost.Chair: Sarah—much delayed.

Q552 Dr Wollaston: Yesterday, we visited City andHackney NHS at the Lawson practice and met anumber of commissioners and other representativesfrom the PCTs. There were several issues that theyraised—in fact, four that I think are crucial. I’d justlike to run through some of those until the Chair losespatience with me.The first one was around the choice agenda. Theymade the very important point that they spend a greatdeal of time commissioning very careful carepathways which deliver better care and save moneyfor the NHS, with Homerton hospital, addressing allthe issues, like David raised, about the number ofoutpatient follow-ups and so forth. The trouble isthat’s completely undermined when patients exercisetheir choice—and often these are not the most needypatients but patients who perhaps don’t need to. Theyexercise their choice to go to University Collegehospital, where the costs are not controlled and there’sno evidence of better outcomes sometimes. Theymake the point that they can spend a lot of timecommissioning very good care pathways, but oftenthey’re in a position where those then are underminedby foundation trusts, perhaps that have high PFI costs,that charge a great deal of money; and they’re not ina position to have the levers of power to alter that. Sothat’s one issue.The second issue around choice and about practiceboundaries, and indeed about the boundaries forcommissioning groups, is the fact that they areconcerned that patients will exercise their choice toregister in fancy, smart practices in the City, when infact they will then be left with patients who have highdependency and high costs. I wonder whether that’san issue you could perhaps refer to.Then, again, with the issue of boundaries, I know Iasked you the last time you came about the issue ofcommissioning boundaries, and you said that thiswould be very much bottom-up and something thatyou would leave GP practices to determine. But willyou be in a position to step in if some of thosecommissioning groups follow entirely illogicalboundaries and people find themselves having tocommission care for patients, but there are entirelyseparate geographical areas? That will affect theirability to work closely with local authorities anddeliver the best quality care.On the purchaser-provider split, we have discussedbefore the make-or-buy decisions. I know many GPswho are keen to roll up their sleeves and get on withcommissioning, but I don’t know any who want toface the risks of facing European procurement rulesand, potentially, face legal challenge. We’ve heardevidence from witnesses in this Committee from the




private sector, telling us that that will happen—thatthey will face legal challenge.Finally, how to address failing practices? One of thegreat scandals in the NHS is not that nobody knewthat doctors and practices were sometimes failing, butthat everybody knew and nobody was able to step ina take appropriate action. One area that PCTs are ableto address at the moment is failing practices. It’shappening too slowly, but it is happening. Who willstep in, in this new organisation? Will it be theCommissioning Board or will GPs be able to directlyidentify, exclude and take action against failingcolleagues and practices? That is the end of my list.Mr Lansley: That is such an excellent list that I willask Dame Barbara to start with care pathways andchoice.Dame Barbara Hakin: Yes, interestingly, I visitedCity and Hackney pathways group a few weeks agoas well. We need to remember—I discussed this withthem—that the tariff is designed to create, at themoment, a consistent cost for services. Therefore, thecost of a specific service, whichever secondary careprovider is involved, is the same. We have said thatwe want to give patients a choice. I think that none ofus in this room would want to deny patients the choiceof where they went to receive their care.One issue on my visit was that, actually, the strengthof commissioning and contracting to ensure that theway that they operated with the two hospitals wasconsistent. They were making the point that they hada better relationship with one than the other and weretherefore able to design care pathways, but hopefullyin the new system they will be able to strengthen theclinical commissioning, so that they can work withboth hospitals equally to ensure that the costs are notdriven up by inappropriate treatments that GPs don’twant to see because they feel that they’re not aseffective and not in the best interests of their patients.But that can’t be at the expense, in the final analysis,of allowing patients to choose where they want tohave a specific treatment.They also raised the point—it is important: welistened when we went to see them—about thefunding issues, particularly for deprived areas. Interms of looking, over the next few years, at theallocations and how those work, the Secretary of Statehas specifically asked us to look at the fundingallocation to ensure that practices and consortiaserving deprived areas get the right income to allowthem to deliver the care that those specific patientsneed. But we need to do that in a way that doesn’tdeny the choice of patients who want choice, whichwould be the other option.

Q553 Dr Wollaston: But will you facilitate thatchoice? We all know that some patients find it difficultto exercise their choice.Dame Barbara Hakin: Absolutely. And there’s abroad range of areas in the reforms where we willhopefully be able to improve, and empower patients.The central tenet of the White Paper is that, somehowor other, we have to support all patients to be in amuch better position to understand the services thatare offered to them and for timely information to bepresented in a way that they can really understand.

That means an extra effort for certain groups ofpatients, so that they can then make informed choices,because we need to be in a position whereby allpatients can make really well-informed choices—notjust a certain cohort.

Q554 Dr Wollaston: And will we have the ability tostop hospitals initiating inappropriate follow-upappointments themselves?Dame Barbara Hakin: I believe that that ability isthere and has been there for some considerable while.Commissioners currently have been differentiallycompetent at managing that. We’ll see that continue.The wherewithal is in the contracting mechanism atthe moment.

Q555 Chair: Can I come in on that? From myunderstanding of what Dame Barbara has just said, theanswer to the core point being made to us yesterday isthat there should be no economic difference to thecommissioning consortium. If a patient chooses to goto one hospital or another, they should both beperforming on the tariff; therefore, there should be noeconomic difference or difference to the rest of thepatients in that consortium. If that is not the result—that is certainly what they were saying to usyesterday—that is the result of weakness ofcommissioning, not weakness of the system.Dame Barbara Hakin: Yes. Absolutely.Mr Lansley: On that thought, as far as I can see, oneof the ways in which we ought to develop paymentby results—the tariff structure—is to increasingly beable to commission and use a tariff along a carepathway. The way in which GPs are describing to youthat they want to construct their local commissioningalong care pathways should also be the basis uponwhich they construct their contracting. That would notclose out UCL from offering that, but it would beperfectly legitimate for it to say, “You can offer aservice to our patients, but you have to offer the wholecare pathway. You can’t just pick bits and pieces tomake that happen.”Dr Colin-Thomé: It is an opportunity, I think, forproviders to be much more helpful in commissioningin this way. You could commission a provider to bethe leading or principle provider of a pathway withurgent care. At the moment, I think we have separatedcommissioning and provision far too much. Weobviously need to do that in the procurement phase,but in designing care we need the clinical input fromproviders. I think you’ll find that GP commissioners,even though it is about GPs, will engage a lot of theclinicians in doing that.The other thing about City and Hackney—I have beenthere as well—is that they feel the power of the bigbeast compared with the local hospitals, which is whatthey were worried about. I would say that you haveto be more flexible. If you feel that, you need to bandtogether with your other PCTs, or consortia in thefuture, to have a bit more leverage. I think that howyou organise yourself in future, rather than being rigidabout your own boundaries, will be key. We are beingtoo frozen by our structures rather than what the heckwe are for. Even on practice boundaries, it sounds likethe GPs want to be a bit too controlling. Whose health




service is this? If a patient wants some choice, theyshould damn well have some choice.

Q556 Dr Wollaston: As long as they are adequatelyremunerated if they are left with higher-risk patientswho have greater needs. I think that is important.Dr Colin-Thomé: Sure.Mr Lansley: Can I comment on that, because I thoughyou made an interesting point? It is particularly truethat in some of the more urban areas people canexercise choice between practices. In my area, forexample, plenty of people commute to London andregister with a GP practice there or, more often, theyregister with a practice in the middle of Cambridge,even though they might live some way away. There isa discontinuity between where they live and wherethey are registered.To some extent, we are very clear that, althoughpatients can exercise choice, GPs can’t cherry-pickpatients. They have to be open to the patients who putthemselves forward to their practices. A lot of thisdepends on us being very clear as we develop—whichwe have begun to do in the allocations to primary caretrusts for the next year—that we seek to relate theresources that are provided to general practice to theprospective burden of disease. For example, we areincreasing the weighting for age and deprivation nextyear. We are trying to focus the resources for the NHSto be more accurately reflective, including, I hope, astime goes by, in relation to individual practices.People who live in Hackney might be registered witha brand-new practice close to them in the middle ofthe city, but if it mainly consists of patients who aren’till, the level of resources that flows from it will bemodest.

Q557 Dr Wollaston: That is great and it is goodnews, because at the moment it is mostly capitationbased, so it is very difficult.Mr Lansley: It will still be capitation, but a veryclearly weighted capitation reflective of theprospective burden of disease of the demographiccharacteristic of the population.

Q558 Chair: But that implies—doesn’t it?—anability to link the resource to an individual rather thanto a polling district or traditional structures?Mr Lansley: At some point, it would probably behelpful for you to hear about not only the work thatwe are doing, but the work that is being done on theDepartment’s behalf by, for example, the NuffieldTrust on seeking to arrive at much better informationabout the prospective burden of disease of particularpopulations. Until now, it has not really been possibleto disaggregate below PCT level and to accuratelyreflect that, but it is increasingly possible. Those dataare being generated partly through the quality andoutcomes framework and the disease registers that gowith it and partly through the development of the tariffsystems, too. Soon we will arrive at the point at whichthere will be robust data that would not only enableus to be clear about the appropriate level of allocationto consortia when the Commissioning Board takes thatresponsibility, but enable the consortia themselves tohave access to those data so that they can make, and

the board can make, very clear, robust allocationsdown to practice level.

Q559 Andrew George: Does that mean that theAdvisory Committee on Resource Allocation, givenall of its work in recent years, is going to be ignoredand you’re starting with a blank sheet of paper?Mr Lansley: No, on the contrary. Today, I haveseparately published my correspondence with theAdvisory Committee on Resource Allocation, inwhich I asked it to do this work. This is where it wantsto be, and this is the work it wants to do.

Q560 Andrew George: The advisory committee hasbeen doing that, and it has been looking at diseaseprevalence, demographic issues and deprivation.Mr Lansley: Yes, and we are going to help it to gofurther in that direction. In the overall allocationtoday, we are devoting more weight to what is,through age and deprivation, reflective of need forhealth care services. You have asked what is beingderated. At the end of the process, the ACRA toldMinisters that they could allocate an amount ofmoney, which might be 10, 15 or 20%, on the basisof inequalities in health outcomes. We are very clearthat we are moving in due course towards separateallocations for NHS services and for public health. Itis clear that the public health allocation will notexceed 10%, although we have not determined whatit will be. So we as Ministers have said to the ACRAthat we will set the allocation for relative healthoutcomes at 10% and allow, consequently, additionalweight to be given to the factors, such as age anddeprivation, that directly relate to health care need.That will impact on the balance of allocations in2011–12.Dr Colin-Thomé: Could I just say—

Q561 Chair: Sorry. I think Sarah asked fivequestions, and so far we’ve got to number two.Mr Lansley: Failing practices are very important, ifBarbara would kindly address that.Dame Barbara Hakin: Failing practices are key, andit should be understood that under the newcommissioning architecture we will not have a boardthat is completely distant from consortia. There willbe a lot of interchange and sharing of the way we dobusiness between the two. The board will have theoverall responsibility for the primary care contracts.We are talking about practices that are failing in theirprovision, but if you are a poor provider, you are alsoa poor commissioner, because good husbandry ofresource is a responsibility of a good practice—ensuring that the whole of your population get the bestpossible services is the duty of an individual GP andtheir practice.We see this as a joint relationship, with the boardhaving the final sanctions, because the board will holdthe contract with the individual consortium. Theboard, probably through its outposts, will be able tointervene where there are serious issues. The consortialeaders have very clearly said to us that, to get themost out of this new system, they feel that consortianeed to have a role in driving up the quality ofprimary care through peer pressure. Consortia need to




be able share learning across practices bydemonstrating to some practices that what they aredoing is significantly different from their peers. I seethe role in managing failing practices as a jointventure between the consortia and the board.Mr Lansley: I have one additional point on that. FromApril 2012, the Care Quality Commission will also beregistering general practice, which I know is notwholly regarded in general practice as withoutburdens. I hope that we can do that with as littleburden as possible by also bringing to bear the RoyalCollege’s practice accreditation process. The CQC, inthose circumstances where there are failings in GPpractices that prejudice levels of quality and safety,will have additional powers to intervene that are notcurrently available.

Q562 Dr Wollaston: The point was made yesterdaythat often clinical audit, particularly in the form ofnotes review, is a very effective way of picking upfailing practices, rather than raw data through theQOF, which can be fraudulently altered and so on.Would the responsibility for the registration processsit with the Care Quality Commission, with the boardor with the consortia?Mr Lansley: As it happens—Barbara will correct meif I’m wrong—I actually think what you’re describingis likely to be part of the integral process of aconsortium looking at the clinical governancearrangements in its area.Dr Colin-Thomé: There is a thing called the globaltrigger tool, where you go through case records thathave been deposited in hospitals, which would havepicked up something of the hospital, and the institutehas been doing some work with general practice onthat particular thing. You get a lot of information froma random selection of notes.Chair: Before we move off that subject, Yvonne hasa question.

Q563 Yvonne Fovargue: I want to take that a bitfurther. As a last resort, if a practice within aconsortium is failing, will it be possible to expel thatpractice? If so, what happens if that practice cannotgo into any other consortium? If no one else willaccept them, what will happen to the patients withinthat practice?Mr Lansley: The NHS Commissioning Board willhave a responsibility to ensure that there is acontinuing service to patients. It will be possible for aconsortium to say, “We can no longer support thispractice in its current form.” But, essentially, underthose circumstances—Barbara will correct me if I’mwrong—we are proposing that they wouldn’t be ableto take a practice out of their area, because rememberthere is an area responsibility, as well as acommissioning responsibility, and not only for theirregistered patients, but for their resident population.To that extent, I think the consortium would have toask the Commissioning Board to intervene in relationto that practice, because it will have the interventionpowers.Dame Barbara Hakin: Yes. In answer to yourquestion, it was in the White Paper, and certainly inthe response, that the consortia have to have a

geographical basis. Therefore, I think that answersyour point, but it leads us into your question, which Ithink is a very good one, because it would be verydifficult for a practice that is right in the middle ofa consortium to be anywhere else. It is important toremember the difference between provision andcommissioning, and the board has responsibility forprovision. A consortium that was not playing anenormous part in commissioning would probablyremain in the consortia, with the board working withthe consortium to improve that. If a practice—Mr Lansley: A practice not playing a part.Dame Barbara Hakin: Yes, sorry. A practice that wasnot playing a part. I am getting the words wrong.If a practice is really so poor that it is are having animpact on the commissioning at the consortium, thatpractice is really poor at provision. Therefore, thereare methods that occur now that are currentlyavailable to PCTs who hold the contract, but will, intime, be with the board that holds the contract,actually to deal with that poor provision, which wouldbe initially perhaps through clinical governance, asyou’ve talked about, but, in the final analysis, wouldbe through the provision contract.It is important to remember that practices are notgoing to be told that they cannot provide services forpatients because they are not playing a big part inthe consortium that is commissioning. They will besupporting the practices to play more of a part incommissioning with the consortium, but their abilityto provide services would still be there.Chair: I don’t think that we can get totally boggeddown in this, but there is some interest in failureregime for practices.

Q564 Valerie Vaz: Just as a follow-up, the consortiawill have geographical boundaries but the GPpractices won’t. Is that right?Dame Barbara Hakin: The majority of GP practiceshave a practice boundary.

Q565 Valerie Vaz: But they don’t have to underthese proposals, do they?Mr Lansley: No. They don’t.

Q566 Valerie Vaz: So how will that work?Mr Lansley: Because there is a combination ofresponsibilities. The consortia will have aresponsibility to commission services for theregistered population of the practices that are theirmembers as well as for the resident population in thearea that they cover. The individual practices will beopen to receiving applications to register as patientswith them from wherever people happen to live. Oneof the things that the previous Government said wasthat they wanted to abolish practice boundaries, butthey hadn’t, which I think is necessary, put in place aclear understanding that that doesn’t mean thatindividual practices must undertake, as it were, homevisiting in any part of the country. GP practices mustbe able, through their prospectus as a practice, to beclear about where they will visit and where theywon’t.Separately, part of the development of commissioningis that we’re looking for that area responsibility of




consortia to be a responsibility for the provision ofunscheduled care in their area. A practice might bepart of another consortium, but if it has registeredpatients who are living in the area of anotherconsortium and if they access that unscheduled carethere will, of course, be—as there is at the momentbetween PCTs—a transfer of resources into thatconsortium to provide their unscheduled care, eventhough the patients happen to be registered withanother practice.

Q567 Chair: So in plain English there will be a map.Mr Lansley: Yes.

Q568 Chair: And a consortium will have a map ofan area where it has a geographical responsibility.Mr Lansley: Yes.

Q569 Chair: And no part of the country will not beallocated to one consortium and no part will beallocated to two consortia.Mr Lansley: That’s right.

Q570 Valerie Vaz: But the GPs don’t. As a patient,am I going to be told that my GP is part of consortiumA and consortium B?Dame Barbara Hakin: No. The practice will be partof a consortium. One imagines that still the vastmajority of patients registering with a practice willlive locally. But in exactly the same way as now, ifyou are part of a PCT, through being part of a practice,and you need urgent care because you happen to besomewhere else in the country, you would still haveaccess to that urgent care and the charge would goback to your PCT. In the same way, significantnumbers of patients aren’t registered with a generalpractice and every consortium—they will cover thewhole country—will have to be responsible for thecare of all the patients who live within theirgeography.Mr Lansley: Technically, it’s a simplification relativeto where we are at the moment. For example, I havea constituency surgery that is a branch surgery of apractice in Hertfordshire. That practice, technically,now has to be both in Hertfordshire and inCambridgeshire PCT areas. In future, for the whole ofits practice area, it can choose to be in consortium Aor consortium B, let’s say.You’ll find that, to some extent, the consortiums willtidy up what are at the moment rather awkwardboundary issues for GP practices, which are createdby the fact that the PCTs have boundaries. But you asa patient are registered with a practice, and thatpractice is responsible for your service. The fact thatit has commissioning arrangements through aconsortium is not something that, from your point ofview, would necessarily be the central issue. The issuefor you is that your practice is responsible for yourcare.

Q571 Chair: I think—if I may say so—that that’srelatively clear and we’ve still got two of Sarah’squestions to answer.Mr Lansley: We did boundaries. Make or buy, andEuropean procurement rules, which we can’t escape—

Q572 Dr Wollaston: No, but it is a big issue forpractices, which have financial responsibility, andpersonal responsibility, in some cases. For some GPs,that is acting as a deterrent to getting on board,because some of them tell me—some have told theCommittee—that they would be put off by the thoughtof having their shoulders constantly looked over byMonitor and facing the threat of legal challenge ontheir commissioning decisions. Could you commenton that?Dame Barbara Hakin: We’re clear that we want asituation whereby practices can deliver better primarycare and general practice in a more unfettered waythan at the moment and then reduce resources andsecondary care. However, it is equally important thatif a group of practices or a consortium wants to offera service that could be offered by someone else, weabide by the law, so those services wouldappropriately be tendered or would follow Europeanlaw—the Secretary of State says that we can’t getaway from that.Over the next few weeks and months, we need to getthrough to practice, and give them the comfort thatthere will be a lot of commissioning support aroundthem and they will have a considerable running-costresource to have the people with them who can advisethem which services they need to tender so that, iftender is necessary, they can do that complicatedprocess of procurement. The idea is that we will,through the clusters, create quite comprehensivecommissioning support arrangements that consortiacould draw on so that, if they felt that they wanted tocreate a new service, they would get the right legaladvice on European law saying, “Is this somethingthat you can simply go ahead and do or do you needto tender it, otherwise Monitor will view this as anti-competitive?” If they need to move to the process ofundertaking that complex tendering process, they willhave managers to support them within their individualconsortium, or they can buy in help to do it.

Q573 Dr Wollaston: So, in other words, everycommissioning pathway that they design—saythrough Homerton hospital; we met thecommissioners yesterday—won’t be subject to legalchallenge and they won’t have to put it out tocompetitive tender. They’ll get clear advice.Dame Barbara Hakin: They will get clear advice.Certainly they will not all be subject to competition.There is a broad range of times when they would notbe subject to competition, but they will have access toadvice that will help them to understand whether whatthey were proposing could be deemed as anti-competitive.Dr Colin-Thomé: And their personal money won’t beput at risk—that is a fear that GPs often express tome, too—because there is quite a separation betweentheir provision and their commissioning responsibility.Mr Lansley: I won’t read them out to you, butparagraphs 6.87 to 6.90 of the Command Paperspecifically address how we will think about theprocess of regulating for competition on thecommissioner’s side. Monitor will have aresponsibility, and the Secretary of State will have a




power to issue regulations setting out how that works.We will consult about that in due course.I would just say this: our intention is that Monitor willhave a concurrent competition jurisdiction in healthand social care. Clearly, we cannot leavecommissioners out of it because they may behave inan anti-competitive fashion, but we will be clear thatthe focus should be on significant breaches wherethere is a significant risk of anti-competitivebehaviour. There will not be high levels of ex-anteregulation of purchasing; it will be specifically aboutaddressing abuse. People behaving in a reasonablefashion should not really be having the competitionauthority looking over their shoulder.

Q574 Dr Wollaston: So we won’t see a race to thebottom, with everyone chasing the lowest cost.Mr Lansley: Absolutely not, because from thepatient’s point of view and the commissioner’s pointof view, quality is the principal criterion on whichthey will be seeking to commission. The reward, notleast to patients and to the commissioners, is indelivering better outcomes.

Q575 Rosie Cooper: Secretary of State, are yousaying that there won’t be a more litigious climate,and that private providers won’t take action if theydon’t think that they are getting enough of a bite ofthe cherry? Are you really saying that?Mr Lansley: They can’t take legal action to get, as itwere, a bite of the cherry. They can go to Monitor asthe competition authority, as we propose, as they cannow go to the Office of Fair Trading. They could goto the competition authority and say that there is anabuse of competition, and the authority would have aresponsibility to investigate and take action if therewas an abuse, but that is no different from now.

Q576 Chair: Can we move on? Grahame Morriswants to ask questions on the timing of theCommissioning Board.Grahame M. Morris: Actually, some of that iscovered in the framework—Chair: You have the advantage of having read it. Doyou want to pass in that case, Grahame?Grahame M. Morris: I wanted to raise the issue ofwider determinants of health, and whether that will bereflected, but we have covered that, in essence.Chair: Fine. Do you want to go there?Grahame M. Morris: No, we have already coveredit, Chair.Chair: Fine. Rosie wants to talk about localauthorities.

Q577 Rosie Cooper: I am not sure where we are, butlet me, if I may, ask a question about consortia andholding meetings in private or public. Will thecommissioning boards be placed under a statutoryduty to meet in public? If not, why not?Mr Lansley: We are not proposing that we shouldprescribe in detail how the commissioning consortiaconduct their own activities internally. We arerequiring them to be transparent. For example, theywill have to publish a constitution, and act in responseto it. They will be accountable for the outcomes that

they achieve. Clearly, they will be accountable forfinancial control and the use of public money, andthere will be clear accounting rules about how thatis exposed.Their own internal management will not beaccountable on a day-to-day basis. There will bespecific proposals in legislation for them to publishtheir commissioning plan each year, and for them topublish through their annual report how they havegone about doing their business. The conclusion thatwe have reached is that they must be prospectivelyclear about their commissioning plan, which must bein line with the joint health and well-being strategyand available to the public and to the local authoritythrough the board. That is prospectively the right wayto do it. Retrospectively, as it were, through theirannual report, we want them to be clear about whatthey have done, how they have achieved it, and whatthey are accountable for. If we try to intrude largeamounts of prescription about the way they managethemselves internally, we will end up with primarycare trusts.

Q578 Rosie Cooper: Obviously, I would not sharethat view. What you have described has patientsnowhere near the heart of decision making, or havingany great influence on that.You have described HealthWatch. How will that beable to influence commissioning? If patients are notgoing to be at the heart of it, who will really be thereto ensure it does happen?Mr Lansley: First, I think your characterisation iscompletely wrong. What we will do, throughcommissioning consortia, will give patients muchgreater involvement in commissioning. Let us be clearabout that. How many patients across England thinkthat the primary care trust is an organisation that atthe moment responds to local patient voice? I havenot been inundated with people explaining to me howgreat is the patient involvement in primary care trusts.

Q579 Rosie Cooper: It’s all pretty dreadful; I getthat. This is not going to make it any better.Mr Lansley: We are going to put the board and theconsortia under a legal duty to involve patients andthe public in their commissioning. As I explained, theCommand Paper says how we are going to strengthenthe role of HealthWatch locally and nationally. Thatwill give patients and the public a real championlocally and nationally. We are where we are. The lastGovernment abolished community health councils;they set up patients’ forums and then abolished them;and they set up LINks. We have to do something thatis stronger in the long run, as a basis for healthrepresentation and health and social care on behalf ofpatients and the public. HealthWatch will do that. Thelinkage directly into the local health and well-beingboard is important; they will be able to do that locally.The use of statutory powers—frankly LINks have fewstatutory powers—will strengthen their role in thefuture using, if need be, the powers of CQC forquality enforcement.

Q580 Rosie Cooper: You have described the patientas the best person to know, and yet you are not




allowing the patient to be at the table taking part—aswould be best—or holding meetings in public so thatthe patient can see the decisions being made at theconsortium. I think it is flawed at the core. Wedisagree yet again, Secretary of State, because wespoke before about people waiting longer on thewaiting list and you disagreed with me. NHSinformation centre data show that the number ofpeople waiting 18 weeks for treatment in the NHShas increased by 15% since the coalition Governmentabandoned the 18-week target. That is 6,000 morepeople waiting.Mr Lansley: That was the August figure. It is all todo with the summer. That’s ridiculous.

Q581 Rosie Cooper: I beg your pardon.Mr Lansley: That is all to do with the summer. Youhave to do a seasonal adjustment on that.

Q582 Rosie Cooper: Forgive me, you are going toget a reputation not for the Lansley challenge but theCanute challenge: “It is not because I say so.” Whenwill the facts get in your way?Dame Barbara Hakin: Just for interest, City andHackney—which has had a long-standing group ofpractices doing some work, which you and I havevisited—has an excellent way of involving patientsand the public in what it does. It has grown that fromthe bottom up; I would be happy to let you havedetails. It is not specifically about one individualboard meeting. It has a comprehensive system fortrying to involve patients and the public.

Q583 Rosie Cooper: If you really believe that, makethe board meetings open to the public—let them seeit happen. If you really believe it, walk the walk andlet them see.Dame Barbara Hakin: It is about ensuring that theseorganisations have a way of ensuring the patients andthe public are involved.Rosie Cooper: What are you hiding? Why has it gotto be in secret? What on earth is going on?

Q584 Andrew George: Can I come back to the issueof looking forward to the consortia themselves andhow they relate to local accountability? In yourstatement today, you say that there will be a “jointhealth and wellbeing strategy” for local authoritiesand the consortia to work on together. I welcome thatas an important step forward from what mightotherwise have been a relative fracturing of localaccountability on the one hand, relating only to socialcare, and the consortia that commission NHS services.It seems to me that you’re moving back towards thecoalition agreement by doing that. In other words, toestablish joint health and well-being strategies, it’sinevitable that local authorities and consortiums willhave to work very much hand in glove. You’rebringing the two back into what is, if not a jointcommissioning board, almost a joint planning boardfor their geographic area. Would you say that is a fairreflection of where you’re going with this?Mr Lansley: I think that’s an entirely fair summary.Indeed, it is dreadfully underestimated how importantthis is in the White Paper. For example, on the day

the pathfinder consortiums were published, I went tosee the GPs in Bexley. It was no surprise I went tosee them. They were working with their primary caretrust. The chief executive was there, and so were thechief executive and the leader of the council.That is because they are all working together. This ishappening now.

Q585 Andrew George: Okay. That’s good. That’smy interpretation of where it’s going. That’s veryencouraging, and I welcome that. What then concernsme—this is partly reflected by the differentpopulations being served by the 52 pathfinders, whichrange from 17,000 to 650,000—is the lack ofcoterminosity between the consortiums and the localauthorities. Shouldn’t you be not micro-managing andtherefore instructing, but encouraging theconsortiums, wherever possible, to establishcoterminosity with their local authorities? That seemsto be the direction in which it is going.Mr Lansley: The direction in which it’s going is beingdetermined by the groups of GPs coming together.They are clearly making judgments themselves. Theyare making different judgments in different places,and I think that’s often for good reasons. Sometimes—I am only illustrating the point, and these are not theexclusive reasons—they are doing that for reasons ofcoterminosity. For example, I was in Widnes talkingto the Runcorn GPs among others. It is not a big area,but if I recall correctly, the GPs in Runcorn said, “Wehave 65,000 patients and we want to have aconsortium, or at least a cluster within a consortium,that is coterminous with the local authority, becausewe’re working with the local authority.” That is fine.There are other places where a group of GP practicesthat is coming together feels that it wants to constructa consortium that broadly reflects the catchment of aparticular hospital. That may be a judgment that isperfectly reasonable to make. In the way that DrWollaston said, GP practices might be thinking abouthaving a range of contracts, and they want to feel thatthey are the dominant commissioner in relation to aset of health care providers so that they can establishthrough their contracts the structure of care pathwaysthat they are looking for and have real weight whenthey do so.These are differing factors. We’ve always been clearon the experience of primary care trusts. When therewere 304, or whatever it was, the geography wasn’tright. Then we moved to 152, and the geographywasn’t right. We’ll go to clusters, and people willargue about the geography. The point is not toprescribe this; the point is to let it be governed bycircumstances and, in truth, to have a flexiblestructure, which the Bill will provide, so that ifcommissioning consortia feel that the geography is notright, they can shift and they can do that easily.

Q586 Andrew George: But the logic of thatstatement is that it would make sense forcoterminosity to exist—Mr Lansley: No.Dr Colin-Thomé: Except that in all the years I’vespent in the health service, coterminosity hasn’tproduced anything unless there are good relationships




and good leadership. What we’re trying to tap into inthese reforms is about going with the energy ofpeople, rather than rigid structures.Mr Lansley: My experience is that people arebuilding relationships at a local level around theWhite Paper and that those relationships are the basison which you really best structure this.Dr Colin-Thomé: All the GP leader organisationsmeet the Local Government Association to discussthis at a national level, too.Chair: I was going to say there are seven minutes leftto deal with conflicts of interest, but there are nowsix. Valerie and David both have questions.

Q587 Valerie Vaz: Before that, I just have a factualquestion. Did you do your own survey of GPs toestablish whether they wanted to go down this road?Mr Lansley: Before?

Q588 Valerie Vaz: Before the White Paper. Did youdo your own survey of GPs? A number of surveyshave come out about whether GPs want this, or wantto handle this £80 billion.Mr Lansley: After the election, but before the WhitePaper, no.

Q589 Valerie Vaz: Going on to conflicts, 25% ofGPs have a stake in private companies or have theirown private companies. Do you see this happeningmore? What safeguards are there for patients in termsof conflicts of interest?Mr Lansley: I have no view about whether it is goingto happen more or less.

Q590 David Tredinnick: Can I add my question? Iam concerned that with all this extra money GPs arenot going to be properly accountable, that there won’tbe any checks or balances on the services that theybuy, and that they can buy from providers with whomthey may have special relationships. There are nochecks to prevent that.Mr Lansley: We knew this was a problem when therewas fundholding in the mid-1990s. GPs were in aposition where they had a conflict of interest, in thesense that they could spend less on treatments forpatients and have a financial benefit to the practice byspending the money on their own practices. They hada conflict of interest because they could send patientsto a connected provider. We are dealing with thoseconflicts of interest. It will not be possible for GPs tosave money on their commissioning budget and forthat to become money in their pocket. It just doesn’twork like that. The only way they can benefitthemselves is if they improve the outcomes forpatients by the value for money that they achieve withtheir commissioning budget.In terms of having contracts, we are in a much betterplace. They can have contracts with providers—withthemselves as provider or a connected interest—butthey can do so only through the consortium. To thatextent, it will be transparent. We touched on it earlier;

if there is an abuse, there will be a competitionregime, the purpose of which is to investigate and, ifnecessary, to act against any such abuse.

Q591 David Tredinnick: One of the most impressiveaspects of going to Hackney yesterday was the doctorssaying that under the new structure, “We are notsetting up a business, we are not going to formourselves into business, we are going to be a co-operative.” There is a danger here: if doctors form intoa commercial unit, and if there are no inducements, itis certainly convenient at times to be influenced bythe fact that it is a commercial organisation rather thanone that isn’t. Certainly doctors yesterday expressedthat view. They said, “We’re not going down thatroute. We want to be a non-profit-makingorganisation.” Perhaps Valerie can help me on that.Mr Lansley: I am not aware of anything in the WhitePaper that, in itself, leads to any difference—anygreater likelihood—that general practitionersindividually or collectively would engage in anadditional commercial practice. They can do it at themoment; they can do it in the future.

Q592 Valerie Vaz: What about safeguards? Theycould send the patients to their own company,couldn’t they?Mr Lansley: Well, the safeguards are partly that thatis safeguarded against by the fact they will have alegal duty and a contractual duty to maximise patientchoice. They can’t just refer patients into their ownconnected interests. They must give patients access tochoice. To that extent, if they own an additionalprovision and it is clearly contracted for on a basisthat is competitive, I don’t have a problem with it. Ifthey are trying to do it in a way that is anti-competitive or that deliberately seeks to restrictcompetition, it is anti-competitive. We’re going tohave a proper competition regime, which at themoment the NHS doesn’t really do. There arelimitations on the proper application of measures tocombat abuse of competitive situations.Dame Barbara Hakin: I think there are three or fourother safeguards. The first is that the paper makes itvery clear that they have to conduct their business inan open and transparent way and in line withprinciples of the public service. That should mean thatunder circumstances where practitioners findthemselves acting in a commissioning environmentand making commissioning decisions where they hadan interest in the provision, they would need todeclare that interest and stand aside from thatdecision. You’ve then got the Commissioning Board,which oversees and authorises.

Q593 Valerie Vaz: Every decision?Dame Barbara Hakin: Not every decision, but itoversees and authorises the way that the organisationsdo their business. We’ve got the safeguarding ofpatients, as the Secretary of State said, because theywill have choice. The final safeguard is that wherethere is clear anti-competitive behaviour, there will bea body that can intervene. That is four levels ofsafeguards against what is a reasonable thing for us tobe concerned about.




Q594 Valerie Vaz: So your view would be to havelots of providers, and that that would make it morecompetitive and better?Mr Lansley: I hope that there will be plurality ofprovision, certainly.

Q595 Valerie Vaz: So more down the privatisationroad, then?

Mr Lansley: No, absolute provision is not the samething as privatisation.Chair: And it’s fair to say that these conflicts ofinterest are not new.At this point—rather against my expectation—atprecisely 11.30 am, the Committee has concluded itsagenda. I thank you all for coming and answeringour questions.

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Written evidence

Written evidence from the Department of Health (COM 01)

Executive Summary

On 30 March 2010, the House of Commons Health Select Committee published the Fourth Report ofSession 2009–10 entitled Commissioning, following their inquiry into this area. The Committee commentedon the previous Government’s reforms since 2000 and made it clear that, under those reforms, progress inimproving commissioning was not suYciently fast or comprehensive. This Government agrees with theCommittee’s assessment.

The Coalition: our programme for government1 document indicated this Government’s intention tostrengthen the power of GP practices as patients’ expert guides through the health system by enabling themto commission care on patients’ behalf. It also pledged to break down barriers between health and socialcare funding to incentivise preventative action.

Commissioning is a key component of any healthcare system. It is about deciding how healthcareresources are used to secure the best care for patients and the best health outcomes. To be eVective,commissioning decisions should be taken at a level as close to patients as possible—it is vital that clinicalresponsibility should not be divorced from commissioning responsibilities. The weaknesses incommissioning, previously identified by the Committee, are symptomatic of a system that did not emphasisethe importance of clinical involvement in decisions about how the precious resources of the NHS shouldbe spent.

The proposals set out in the White Paper Equity and Excellence: Liberating the NHS,2 published on 12July, set out a clear sense of direction, with consistency of strategy and the commitment to putcommissioning decisions in the hands of those who are closest to patients themselves—GP practices. Underthese proposals, GP practices will work with, and draw upon, expertise from those working in health andsocial care to ensure that they have appropriate specialist input into their commissioning decisions.Liberating the NHS outlined the Government’s long-term vision for the future of the NHS, building on thecore values and principles of the NHS—a comprehensive service, available to all, free at the point of use,based on need, not ability to pay.

Liberating the NHS set out how we propose to:

— put patients at the heart of everything the NHS does;

— focus on continuously improving those things that really matter to patients—the outcome of theirhealthcare; and

— empower and liberate clinicians to innovate, improve healthcare services and be accountable forresults.

We propose shifting decision-making as close as possible to individual patients, by devolving power andresponsibility for commissioning services to local consortia of GP practices. This change will build on thepivotal and trusted role that primary care professionals already play in co-ordinating patient care, throughthe system of registered patient lists and brings together responsibility for management of care with themanagement of resources. This is an essential component of a more eVective commissioning structure.

We propose to establish an NHS Commissioning Board whose role will include supporting anddeveloping an eVective and comprehensive system of consortia and holding consortia to account fordelivering outcomes and financial performance. The Board would also provide leadership for qualityimprovement through commissioning, promote and extend public and patient involvement and choice,commission certain services (such as primary care services and specialised services) and allocate and accountfor NHS resources.

Our plans to introduce a new commissioning system led by groups of GP practices at local level andoverseen nationally by an independent NHS Commissioning Board, are intended to transform the qualityof care and health outcomes for patients. Giving Commissioning consortia more responsibility and controlover commissioning budgets will align clinical decisions with their financial consequences and support moreeVective use of NHS resources.

To ensure that local services work together eVectively, the Government proposes to establish newstatutory arrangements to strengthen the role of local authorities. Local authorities would have greaterresponsibility in four areas:

— leading joint strategic needs assessments to ensure coherent and co-ordinated commissioningstrategies;

— supporting local voice, and the exercise of patient choice;

1 http://www.cabinetoYce.gov.uk/media/409088/pfg coalition.pdf2 http://www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH 117353

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— supporting joined up commissioning of local NHS services, social care and health improvement;and

— leading on local health improvement and prevention activity.

Under the proposals set out in Local democratic legitimacy in health,3 local government would have anenhanced responsibility and a statutory duty for promoting partnership working and integrated delivery ofpublic health services across the NHS, social care, public health and other services.

Liberating the NHS was the start of an extensive engagement process on how best to implement thesechanges. A number of supporting documents have now been published. In particular, Liberating the NHS:Commissioning for Patients4 and Increasing Democratic Legitimacy in Health invite views on questions ina number of areas of the commissioning agenda. This exercise closes on 11 October.

Within this evidence we have set out the proposed direction of travel for commissioning in a number ofareas. This should be seen within the context of the wider engagement exercise that is currently underway.The overall design of the proposals set out in Liberating the NHS will be subject to the outcomes of thisconsultation and engagement exercise and to Parliamentary approval of the necessary primary legislation.

Clinical Engagement in Commissioning

How will commissioners access the information and clinical expertise required to make high quality decisionsabout the shape of clinical services?

The provision of quality and timely information is essential to ensure informed decision-making.Currently, active clinical commissioners use information provided by their Primary Care Trust (PCT) onbudgets, expenditure, referrals, prescribing, activity and where possible, clinical performance to review localneed and current service provision. They can use this information to release and reinvest resources by usingtheir skills and knowledge to challenge ineVective and inappropriate clinical interventions and clinicalpractice.

Devolving power and responsibility for commissioning of services, along with real budgets, to localconsortia of GP practices would mean the quality of management data and financial information willbecome of increasing importance.

Under the proposals set out in the document Local democratic legitimacy in health,5 local governmentwould have an enhanced role in public health, with direct responsibility and funding (allocated to localDirectors of Public Health) for improving the health of local communities. This enhanced role for localgovernment would provide a framework through which Commissioning consortia alongside other partners,contribute to a joint assessment of the health and care needs of local people and neighbourhoods and drawon the advice and support of the local authority or the proposed health and wellbeing board in relation topopulation health.

We will work with the profession and the wider NHS to identify how best to support consortia in thesignificant challenge of accessing accurate, real-time data that can be translated into information to supporteYcient and eVective care along the patient pathway and to understand the relationship between patientneeds, service provision, health outcomes and financial expenditure. The NHS Commissioning Board wouldbe responsible for helping to identify the information needs of commissioning consortia. Local authoritiesor the proposed health and wellbeing boards, in partnership with their relevant consortium/consortia andothers, would have wider responsibilities to undertake joint assessments of needs, identify strategic prioritiesand promote innovation in services to meet local needs. This work will provide an agreed local strategiccontext in which commissioning takes place, strengthening local accountability.

GP practices co-ordinate patient care and are well placed to lead on the commissioning of care forpatients. However, we would expect consortia to involve relevant health and social care professionals fromall sectors in helping design care pathways or care packages that achieve more integrated delivery of care,higher quality, better patient experience and more eYcient use of NHS resources. This would mean consortiaensuring that they have access to and draw upon the necessary expertise of those working in health and socialcare to ensure that they have the most appropriate specialist input into their commissioning decisions.

How will commissioners address issues of clinical practice variation?

The NHS Commissioning Board would provide a framework to support Commissioning consortia incommissioning services, including setting commissioning guidelines on the basis of clinically approvedQuality Standards which would be developed with advice from NICE, in a way that promotes joint workingacross health, public health and social care. NICE Quality Standards will provide a single evidence-basedframework for commissioning and delivery of good quality care that can be shared by both clinicians andcommissioners. NICE Quality Standards will be based on outcomes for people across health and care, andwill address prevention and support as well as clinical treatment.

3 http://www.dh.gov.uk/en/Consultations/Liveconsultations/DH 1175864 http://www.dh.gov.uk/en/Consultations/Liveconsultations/DH 1175875 http://www.dh.gov.uk/en/Consultations/Liveconsultations/DH 117586

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The performance of consortia as commissioners will be closely bound up with the quality of servicesprovided by their constituent practices. The eVective identification and management of long-termconditions, the accessibility and responsiveness of GP services, and decisions on referrals and prescribingall have a major impact both on the overall quality of patient care and on the eYcient use of NHS resources.We propose, therefore, that consortia should play a role in working with individual GP practices in theirconsortium to drive up the quality of primary medical care and improve overall utilisation of NHS resources.

We propose that the NHS Commissioning Board should have the power, where it judges it appropriate,to ask consortia to carry out on its behalf some aspects of the work involved in managing primary medicalservices contracts, for instance by promoting quality improvement or reviewing and benchmarking practiceperformance. This potential role for Commissioning consortia will help to ensure that action to ensure goodfinancial management sits alongside and complements GPs clinical responsibilities to patients and their rolein supporting patient choice. Consortia would have some responsibility to challenge any behaviours that areinappropriate both for good clinical care and for eYcient use of NHS resources. Peer review would play animportant part of the process.

We propose that the NHS Commissioning Board, supported by NICE, will develop a commissioningoutcomes framework that measures the health outcomes and quality of care (including patient-reportedoutcome measures and patient experience) achieved by consortia, with an appropriate adjustment forpatient mix. This would, for instance, assess the health outcomes achieved for people with long termconditions, the quality of urgent care and acute hospital care, and health outcomes for people with long-term mental health conditions or a learning disability. It would include measures to reflect the consortium’sduties to promote equality and to assess progress in reducing health inequalities.

We want the NHS to focus on securing improved health outcomes for patients rather than on top-downprocess targets that do not lead to improvements in patient health. We propose to reform the Quality andOutcomes Framework so that it better promotes improvement in healthcare outcomes achieved by GPpractices as individual providers of primary care. We will discuss this with the profession over the comingmonths.

How will GPs engage with their colleagues within a consortium and how will consortia engage with the widerclinical community?

It is our intention that GP commissioning is put on a statutory basis, with powers and responsibilities setout through primary and secondary legislation. However, we do not propose to be prescriptive about theexact organisational and governance arrangements that Commissioning consortia would need to follow,aside from certain essential requirements (such as financial accounting).

Commissioning consortia would need to develop arrangements for both working with their constituentpractices and for holding their constituent practices to account.

Commissioning consortia might also want to develop their own arrangements for engaging with otherconsortia, for example through networks of commissioners. The need for such arrangements might varydepending on geography, the disease area for which services are being commissioned, and the wishes ofCommissioning consortia themselves.

Commissioning consortia would be able to involve specialist expertise in the commissioning of servicesas they see fit. EVective GP commissioning will require the full range of clinical and professional inputalongside that of local people. Hospital doctors, nurses, pharmacists, Allied Health Professionals and othersall have a vital role to play and a real opportunity to develop services and improve the health outcomes oftheir local populations. Consortia will need to ensure that they have access to and draw upon the necessaryexpertise of those working in health and social care to ensure that they have the most appropriate specialistinput into their commissioning decisions.

In addition, we envisage that local authorities would have a pivotal role in promoting integration betweenNHS, social care and public health services. Consortia would be required to work closely with other publicservices in the local area brought together by local authorities or by the proposed health and wellbeingboards. In the Programme for Government6 we were clear that the NHS would work in strong partnershipswith patients, carers, families, local services, councils and the police. EVective commissioning would addressthe needs of the population and the specific needs of people who are vulnerable and require safeguarding.

6 http://programmeforgovernment.hmg.gov.uk/



How Open will the System be to New Entrants?

Will potential new entrants be free to oVer alternative commissioning models?

Any GP practice awarded a primary medical services contract and having a registered list of patientswould be obliged to join a consortium. We envisage a reserve power for the NHS Commissioning Board toassign practices to consortia, if necessary.

GP practices would have the flexibility within the proposed legislative framework, to form consortia inways that they think will secure the best healthcare and health outcomes for their patients and locality. Thiswould be subject of course, to the NHS Commissioning Board being satisfied that a consortium is able tofulfil its statutory duties and that there is a comprehensive system of consortia across England.

Within the scope of NHS services as defined by the Secretary of State, Commissioning consortia, inconsultation with their respective local authorities, would be broadly free to decide commissioning prioritiesto reflect local needs, supported by the national framework of NICE Quality Standards, tariVs and nationalcontracts established by the NHS Commissioning Board. They would be able to adapt model contracts toinclude the quality dimensions that they judge will produce the best outcomes. Consortia would be expectedto participate in assessing local needs. Local government would set and agree local strategies for healthimprovement and delivering public health priorities, to ensure that commissioning activities meet the needsof the local population.

Each consortium would be free to develop its own arrangements for commissioning services. This couldinclude working with those currently in PCTs with whom they have a close relationship with, working withlocal authorities, and working with external partners. Each approach would oVer an alternativecommissioning model, which consortia would be free to change and/or build upon over time.

Will care providers be free to oVer new solutions which oVer higher clinical quality, better patient experienceor better value?

Care providers would be free to oVer new solutions oVering higher clinical quality, better patientexperience and better value. Under our twin policies of Any Willing Provider and patient choice, those thatdo so are likely to attract greater patient numbers and corresponding increases in income to enable them tomeet the costs of expanding the services that they provide.

Under GP-led commissioning, these incentives may be further strengthened. In aligning clinical decision-making with the financial resources used to support those decisions, consortia would be free to work withhealthcare providers to help design and redesign care pathways and care packages. In addition, collaborativeand joint commissioning arrangements with local authorities would present opportunities for greaterintegration between health and social care services and for developing innovative care solutions that achievebetter value, better quality services and better outcomes for people.

Consortia will be commissioning bodies and would not be able to provide services in their own right.However, consortia would be able to commission services from individual practices or groups of practices,subject to appropriate safeguards, where this would provide best value in terms of quality and cost.

Will commissioners be free to access new commissioning expertise?

We have set out very clear expectations that Commissioning consortia would work closely with otherhealth and social professionals under the new system of commissioning and this would help to ensure awealth of expertise and knowledge is harnessed during the commissioning process.

It is envisaged that commissioning budgets would include a maximum management allowance forCommissioning consortia, to reflect the necessary management and running costs associated withcommissioning. Consortia would be free to determine how this management allowance is used to meet thecosts associated with commissioning.

It is important to remember that commissioning is a set of many actions. Consortia would be likely tocarry out a number of commissioning activities themselves, especially those where clinical input is involved.For the more technical aspects of commissioning (eg data analysis or contract management), it might bethat they would not have these skills in-house. In some cases, consortia might choose to act collectively, witha lead commissioner negotiating and monitoring contracts with large hospital trusts or urgent careproviders. They might also choose to buy in expertise and support from external organisations, includinglocal authorities and private and voluntary sector bodies, to assist in the exercise of their functions. Thismight, for instance, include analytical activity to profile and stratify healthcare needs, support forprocurement of services and contract monitoring.



What arrangements will be made to encourage the Third Sector both as commissioners and providers?

Charities and voluntary organisations have a vital contribution to health and care, not only as theproviders of services but also as advocates, partners in the co-design of services and involvers and engagersof local communities.

They often have valuable expertise, insight and experience that can improve local public services, oftenfor the most excluded people in our communities. The voluntary sector could, for instance, be well placedto support commissioners in developing needs assessments and commissioning guidelines. Current examplesof voluntary sector involvement include Mumsnet who have been particularly valuable in helping to shapematernity services and Turning Point on the Connected Care Audit.

There are a range of options we need to explore over the coming period to help maximise the potentialcontribution of this sector. We need to ensure that commissioners and providers across healthcare, publichealth and social care are able to harness the potential role of voluntary sector organisations incommunities—helping to build strong and resilient communities as part of the Big Society.

Commissioning consortia would be able to decide which commissioning activities they undertake forthemselves and for which activities they choose to buy in expertise and support from external organisations,including from voluntary sector bodies. Charities and voluntary organisations could potentially strengthenthe process of public and patient engagement and needs assessment through their knowledge andunderstanding of local people’s needs. We propose that consortia should have the power, where theyconsider it appropriate, to award grant funding as a way of supporting the sector to be able to contribute.

To help build the Big Society, Commissioning consortia and local government could consider the role ofgrant funding to charities and voluntary organisations to stimulate community involvement and socialaction in improving health and care. An example of this would be stimulating volunteering activitysupporting people with long term conditions.

As part of the reforms, we aim to free up provision of healthcare, so that in most sectors of care, any willingprovider can provide services that meet NHS standards within NHS prices, giving patients greater choiceand ensuring eVective competition stimulates innovation, improves quality and increases productivity. Wewill look across government and public procurement to make sure that charities, voluntary organisationsand social enterprises have maximum opportunities to oVer health and care services.

We are committed to promoting continuous improvement in the quality of services for patients andgreater opportunities for involvement of independent and voluntary providers in oVering more responsiveand personalised services.

Accountability for Commissioning Decisions

How will patients make their voice heard or their choice eVective?

Patients, and in particular people with long term conditions, want to make a diVerence to the way thatservices are designed and delivered so that they meet their needs. Evidence shows that good engagementunlocks investment as it enables the public to understand the need for and benefits of changes to the serviceand to contribute to service development to ensure proposals best meet the needs of patients.

One of the principal aims of our proposals for GP commissioning is to make decisions more sensitive andresponsive to the needs and wishes of patients and the public. GP practices are ideally placed to do this. With300 million consultations a year in general practice, GPs and other primary care clinicians are best placedto understand the needs of their patients. Under our proposals, both Commissioning consortia and the NHSCommissioning Board would need to develop eVective ways of harnessing the public voice so thatcommissioning decisions are increasingly shaped by people’s expressed needs and wants.

The NHS Commissioning Board would champion eVective patient and public involvement andengagement in commissioning decisions, and greater involvement of patients and carers in decision-makingand managing their own care. It will also develop the guarantees for patients about the choices they makeand promote and extend information to support meaningful choice of what care and treatment patientsreceive, where it is provided and who provides it. The Board will also commission information requirementsfor choice and for accountability, including patient-reported experience and outcome measures.

We will strengthen the collective voice of patients, bringing forward provisions in the forthcoming HealthBill to create HealthWatch England, a new independent consumer champion within the Care QualityCommission. Local Involvement Networks (LINks) would become the local HeatlhWatch, creating a stronglocal infrastructure, and we will enhance the role of local authorities in promoting choice and complaintsadvocacy, through the HealthWatch arrangements they commission.

The wider public voice will be heard through our proposals to achieve greater local legitimacy in the healthservice. Local authorities would lead on developing joint strategic needs assessments with relevantcommissioners including consortia and on health improvement. The intention is that this provides a strongframework through which local people can shape the priorities and commissioning activity in theirneighbourhoods. In addition, local authorities would be able to escalate proposals for substantial servicedevelopments or changes to the NHS Commissioning Board and to the Secretary of State, where the localauthority believes that such changes run contrary to the interests of local people.



A representative of Local HealthWatch would have a seat on the health and wellbeing boards proposedin the Local Democratic Legitimacy consultation, which would give it—and by extension patients—apowerful voice to scrutinise and influence strategic decisions across the local health and care system.

Professionals understand patients’ health needs but only local people understand their local communityand their everyday needs. Both sets of knowledge are essential for planning and delivering outcomes thatmatter to patients.

What will be the role of the NHS Commissioning Board?

The NHS Commissioning Board as an independent statutory body will provide overall leadership oncommissioning. It would be accountable to the Secretary of State for managing the overall commissioningrevenue limit and for delivering improvements against a number of health outcomes. We propose five broadfunctions of the NHS Commissioning Board, which are:

— providing national leadership on commissioning for quality improvement;

— promoting and extending public and patient involvement and choice;

— ensuring the development and authorisation of consortia and holding them to account;

— commissioning certain services that are not commissioned by consortia, such as primary careservices; and

— allocating and accounting for NHS resources.

The role of the new NHS Commissioning Board would provide strengthened leadership and oversight ofcommissioning.

What legal framework will be required to underpin commissioning consortia?

Commissioning consortia would be statutory bodies with powers and responsibilities set out throughprimary and secondary legislation.

This legislation would include a consortium’s duties in relationship to financial management, includingensuring that expenditure does not exceed its allocated resources and requirements in relation to reporting,audit and accounts.

How will commissioning interface with the Public Health Service?

The programme for public health will be set out in a White Paper later this year. However, subject toParliamentary approval, the forthcoming Health Bill will enable the creation of a new Public Health Service(PHS), to integrate and streamline existing health improvement and protection bodies and functions,including an increased emphasis on research, analysis and evaluation. We envisage that where the PHS needsto commission public health interventions from healthcare providers, including General Practice, it wouldbe able to do so either by commissioning services itself or by asking the NHS Commissioning Board to doso on its behalf.

The Secretary of State, through the Public Health Service, would set local authorities national objectivesfor improving population health outcomes. It would be for local authorities to determine how best to securethose objectives, including by commissioning services from providers of NHS care. They would have a ring-fenced health improvement budget, allocated by the PHS, and they would be able to deploy these resourcesto deliver national and local priorities. There would be direct accountability to the local authority and(through the PHS) to the Secretary of State.

In order to manage public health emergencies, the Public Health Service would have powers in relationto the NHS matched by corresponding duties for NHS resilience. The NHS Commissioning Board wouldhave a role in supporting the Secretary of State and the Public Health Service to ensure that the NHS inEngland is resilient and able to be mobilised during any emergency it faces, or as part of a national responseto threats external to the NHS. The NHS Commissioning Board would promote involvement in researchand the use of research evidence.

How will commissioning interface with HealthWatch?

We will strengthen the collective voice of patients and the public through arrangements led by localauthorities, and at national level, through a powerful new consumer champion, HealthWatch England,located in the Care Quality Commission.

The NHS Commissioning Board would take the lead in extending public and patient involvement andchoice in the NHS by championing eVective patient and public involvement and engagement incommissioning decisions, and greater involvement of patients and carers in decision-making and managingtheir own care, working with consortia, local authorities, patient groups and HealthWatch.

Subject to the consultation, local HealthWatch would be represented on the proposed health andwellbeing boards, which would help ensure that the views and feedback from patients and carers inform localcommissioning across health and social care.



Where will the “buck stop” when commissioners face hard choices?

Determining the comprehensive service which the NHS provides will remain the responsibility of theSecretary of State. In addition, the Secretary of State would hold the NHS Commissioning Board to accountfor delivering improvements in outcomes, strengthening patient choice and patient involvement, andmaintaining financial control.

The NHS Commissioning Board would be responsible for holding consortia to account for theirstewardship of NHS resources and for the outcomes they achieve as commissioners. Where commissionersfail to fulfil their statutory functions, the NHS Commissioning Board would have powers to intervene and,if necessary, to take over a consortium’s commissioning responsibilities.

Local authorities and Commissioning consortia would work together to take decisions in the best interestsof local people, and support joint commissioning arrangements where they have the potential to deliverimprovements in patient care. Where disputes over commissioning priorities arise, the test of the newarrangements would be the ability of the local authority or the proposed Health and Wellbeing Board toresolve them locally. We have specifically asked for views through the current consultation on what supportcommissioners and local authorities might need to empower them to do this. In a small minority ofexceptional cases, where a consortium proposes a major service development or major service change in alocal authority area and a dispute cannot be resolved locally, we propose that local authorities would havethe right to refer to the NHS Commissioning Board to seek resolution. If local authorities continue to haveconcerns after all other resolution routes have been exhausted, we are considering whether they would havethe option to refer cases to the Secretary of State (who may ask the Independent Reconfiguration Panel foradvice if a substantial service change is proposed).

Ultimately, the consortia would be accountable to their patients for the decisions they take ascommissioners. Our plans to allow patients to choose a GP practice will give the public the freedom tochange their commissioner.

Integration of Health and Social Care

How will any new structures promote the integration of health and social care?

There are a number of routes through which the integration of health and social care would be promoted:

First, local authorities would have a crucial oversight role in relation to health services. Local authoritieswould be able to exercise influence over NHS commissioning decisions through promoting jointcommissioning. This would enable them to seek to ensure that such decisions are aligned with social carecommissioning decisions. Local authorities would lead the statutory joint strategic needs assessment, whichwill inform the commissioning of health and care services and promote integration and partnership acrossareas, including through joined up commissioning plans across the NHS, social care and public health. Theywould support joint commissioning and pooled budget arrangements and will undertake a scrutiny role inrelation to major service redesign. One option for doing this is through the creation of statutory health andwellbeing boards within local authorities, which would bring together elected representatives, NHScommissioners (including Commissioning consortia), social care and public health to assess the health andwell-being needs of local people and ensure that they are being met.

Second, we propose to ring-fence public health monies and allocate them to local authorities. This willhelp deliver truly integrated preventative health and social care services—for example, in relation to falls,early years’ services and safeguarding of children and vulnerable adults.

Third, we are driving forward with our proposals to create personal budgets by combining both health andsocial care revenue streams—giving individuals themselves the opportunity to drive integration of servicesaccording to their needs.

In addition to commissioning arrangements, we are also examining financial incentives to deliver betterintegration. As a first step, we are making the NHS pay for the first 30 days of care after a patient isdischarged from 2011–12—at a point when a patient is often in need of integrated health and social careservices.

What arrangements are proposed for shared health and social care budgets?

The enhanced role for local government would provide a framework through which Commissioningconsortia alongside other partners contribute to a joint assessment of the health and care needs of localpeople and neighbourhoods and ensure that their commissioning plans, and relevant joint commissioningplans, reflect the health needs identified in these assessments. It would also help identify ways of achievingmore integrated delivery of health and adult social care, for instance through pooled budgets or leadcommissioning arrangements (eg a local authority becoming the lead commissioner for some older people’sservices).

There are a number of flexibilities in the NHS Act 2006 that are designed to encourage integrated working.These include for example Section 75 regulations which enable local authorities and NHS Bodies to poolbudgets and Section 77 which enables specified NHS bodies to apply to become a Care Trust. Subject to the



views put forward in response to the White Paper consultations including Local democratic legitimacy inhealth, we believe that it is important to ensure that current legal flexibilities that enable integrated workingare applied in most localities in ways that meet requirements and deliver health and care outcomes eVectively.

What will be the Role of Local Authorities in Public Health and Commissioning Decisions?

The local authority will lead the process of undertaking joint strategic needs assessments (JSNA) acrosshealth and local government services and would support joint commissioning between consortia and localauthorities. Consortia and the NHS Commissioning Board would be responsible for making healthcarecommissioning decisions, informed by the local commissioning strategies that reflect JSNAs.

Health and wellbeing boards would have a key new role in promoting joint working, with the aim ofmaking commissioning plans across the NHS, public health and social care coherent, responsive andintegrated. In future, local authorities would have a stronger influence on the health outcomes of their localarea. When, under our proposals, PCTs cease to exist, we intend to transfer responsibility and funding forlocal health improvement activity to local authorities. Embedding leadership for local health improvementactivity within local authorities would build upon the existing success of the many joint Director of PublicHealth appointments between local authorities and PCTs. Directors of Public Health might commissionlocal health providers, including GP practices, to provide local health improvement initiatives, such astailored advice and support services.

The Department will create a ring-fenced public health budget and, within this, local Directors of PublicHealth would be responsible for health improvement funds allocated according to relative population healthneed. The detail of how these budgets would operate and how they would be allocated are still indevelopment but the allocation formula would include a new “Health Premium” designed to promote actionto improve population-wide health and reduce health inequalities.

How will the New Arrangements Strengthen Commissioners against Provider Interests?

Implementation of the new commissioning proposals set out within the White Paper would be drivenbottom up, with Commissioning consortia working with PCTs to ensure a smooth transition (although PCTswould until their abolition remain legally responsible for commissioning).

Consortia would be free within the new legislative framework to develop collaborative or pan-consortiaarrangements which may help balance dominant providers in their negotiations. In addition, anti-competitive behaviour by providers would be subject to the Competition Act under which Monitor will begiven concurrent powers of enforcement.

Consortia would commission the great majority of NHS services on behalf of patients, including electivehospital care and rehabilitative care, urgent and emergency care, most community health services, andmental health and learning disability services.

The NHS would be focused on outcomes and the NICE Quality Standards that define their delivery, withcommissioners using guidance drawn from the library. Commissioning consortia and providers would agreelocal priorities for implementation each year, taking account of the NHS Outcomes Framework. NICEQuality Standards will be reflected in commissioning contracts and financial incentives.

Together with essential regulatory standards, these proposals will provide the national consistency thatpatients expect from the NHS. Providers will be paid according to their performance with payment reflectingoutcomes, not just activity, and providing an incentive for better quality. In addition, if in future, providersdeliver poor quality care, the commissioner will also be able to impose a contractual penalty.

The absence of an eVective payment system in many parts of the NHS severely restricts the ability ofcommissioners and providers to improve outcomes, increase eYciency and increase patient choice. In future,the structure of payment systems would be the responsibility of the NHS Commissioning Board, and theeconomic regulator would be responsible for pricing. In the meantime the Department will start designingand implementing a more comprehensive, transparent and sustainable structure of payment forperformance so that money follows the patient and reflects quality.

We propose to accelerate the pace of development of payment by results, starting in 2011–12 by mandatingcurrencies for use in contracting for adult and neonatal critical care and introducing some new currenciesfor services such as smoking cessation and cystic fibrosis. Good progress is being made towards mandatingcurrencies for adult mental health services in 2012–13, and in developing currencies for child and adolescentservices and payment systems to support the commissioning of talking therapies. From next year we willbegin prioritising eVorts to expand currencies and tariVs into community services.

At the same time, we are making the current payment system more eVective at supporting high-quality,integrated and eYcient care. We will rapidly accelerate the development of best practice tariVs, introducingan increasing number each year, so that providers are paid according to the costs of excellent care, ratherthan average price. In 2011–12 there will be best practice tariVs for adult renal dialysis, some day casesurgical procedures, interventional radiology, mini-strokes and primary hip and knee replacements. We arelooking to develop currencies and tariVs that support the entire patient pathway, beginning in 2011–12 witha currency for cystic fibrosis based on a complexity-adjusted year of care model, an approach that could beextended to other areas such as multiple sclerosis. Maternity is a good example of where we can make further



progress. We are developing a small number of simple and practical pathway tariVs for maternity care,covering the whole period from the booking-in clinic through to postnatal care, and we hope to implementthese for payment from 2012–13.

From 2011–12, changes to the tariV will mean that providers will have a greater incentive to dischargepatients at the right time, and with adequate support, so that numbers of inappropriate readmissions—which have increased by over 50% in the last 10 years—are reduced. Other changes to the tariV in 2011–12will drive eYciency, including some benchmark prices set below the average of reported costs, and bettertargeting of payments for relatively long stays in hospital.

How will vulnerable groups of patients be provided for under this system?

Under our proposals there are multiple arrangements for protecting and improving quality of care forvulnerable patients:

— appropriate safeguarding responsibilities will be conferred on commissioners;

— all providers of regulated health and adult social care activities will have to be registered with theCare Quality Commission and, under the new registration system that CQC is introducing, meetthe 16 essential requirements of safety and quality;

— local authorities would take the lead on promoting partnership working and integrated delivery ofpublic services across the NHS, social care, public health and other services. It is intended that thisenhanced role for local government would provide a framework through which Commissioningconsortia alongside other partners, can play a systematic and eVective part in joint action topromote the health and wellbeing of local communities, including combined action onsafeguarding of children and vulnerable adults;

— HealthWatch at both local and national levels would have a role in ensuring services are not failingvulnerable groups. At the national level, HealthWatch would have a powerful new role to suggestareas for investigation by the Care Quality Commission;

— the proposed NHS Outcomes Framework would recognise the importance of reducing inequalitiesand promoting equality. As far as possible, outcomes would also be chosen so that they can bemeasured by diVerent equalities characteristics. This would be reflected in the CommissioningOutcomes Framework which would include measures to reflect the consortium’s duties to promoteequality and to assess progress in reducing health inequalities;

— in order to ensure that consortia are rewarded and incentivised for improving care for allpopulation groups, including those who are most vulnerable and for whom outcomes may be morediYcult to achieve, the commissioning outcomes framework would include an appropriateadjustment for case-mix; and

— as NICE Quality Standards will underpin the outcomes in the NHS Outcomes Framework wewould also propose that they should inform the development of the Commissioning OutcomesFramework. This will promote greater sensitivity in commissioning services for all patient groups.

How will the Proposed System Facilitate Service Reconfiguration?

It is vital that the NHS continues to modernise and improve, but this must go hand-in-hand with an NHSwhere improvements are driven by local clinicians, patients and their representatives from the ground up.The Government believes that the best decisions are local decisions. We have been clear that servicereconfigurations that do not have the support of GP practices and other local clinicians working withpatients and communities should not happen.

With that aim in mind, the Secretary of State has introduced four key criteria for service change, whichare designed to build confidence within the service, with patients and communities. These criteria were setout in the Revisions to the NHS Operating Framework for 2010–11 and require existing and futurereconfiguration proposals to demonstrate:

— support from GP commissioners;

— strengthened public and patient engagement;

– clarity on the clinical evidence base; and

— consistency with current and prospective patient choice.

These criteria and the reforms proposed in Liberating the NHS provide a significant opportunity for GPsand other clinicians, local authorities and the public to have a greater role in how services are shaped, andto ensure that any changes to services lead to the best outcomes for patients. Future service change will berightly spearheaded by GP practices, through Commissioning consortia and in consultation with localauthorities, as it is they who are closest to patients, know the healthcare that they need, and know howpatients can best access it. Under our proposals to empower local clinicians to decide how best to achieve



the right outcomes for local people, and by enhancing the role of local councils to shape health and careservices, this Government will ensure that patients and the public are provided with the very best NHSservices now and in the future.

The proposed health and wellbeing boards would provide a powerful forum for planning servicereconfiguration to achieve greater integration between Social Care and Public Health systems and the NHS.

Transitional Arrangements

Will the new arrangements safeguard current examples of good practice?

Commissioning for patients provides further information on the intended arrangements for GPcommissioning and the NHS Commissioning Board’s role in supporting consortia and holding them toaccount. It seeks views on a number of specific consultation questions and includes an invitation to bringforward examples of existing practice and evidence that support respondents’ views in order that we canlearn from current examples of best practice. Consortia would, in the future, be free to seek commissioningexpertise from a range of partners, whether they be independent or voluntary sector organisations, localauthorities, or from those with whom GP practices already work closely in Primary Care Trusts. Where thereare current examples of good practice, consortia would be free to continue these arrangements, and to buildupon them.

Who will drive innovation during the transitional period?

The current position is that Strategic Health Authorities have a legal duty to promote innovation. Thiswill continue to be the case during the transitional period and for the duration of their formal constitution.

Our proposals for GP Commissioning build on years of involvement of GPs in commissioning. Theprevious administration introduced practice based commissioning (PBC) over five years ago, and some PBCconsortia are doing an excellent job. But many PBC consortia have been frustrated by not having clearresponsibility and control and by the failure to transfer real freedom and responsibility to PBC consortia.We are now learning from the past, and propose to oVer a clear way forward for GP practices andCommissioning consortia.

Practice-based commissioners will have a significant part to play in continuing to drive innovation, servicechange and delivery of high quality services during the proposed transition to GP commissioning.

How will transitional costs (redundancy etc) be minimized?

We are extremely conscious of the need to minimise the costs of transition to the new system, and we areactively looking at the ways to reduce these costs. As part of the transition towards the new commissioningbodies, work will be carried out to identify which PCT functions transfer where and which come to an end.We will not be able to confirm the approach we are taking until the consultation is completed and we knowhow the new organisations will be designed.

However, we have already committed to reducing management costs by over 45%. We will ensure that thechanges outlined in the White Paper—including abolishing PCTs and SHAs—will enable us to achieve orexceed this objective.

We need to strike a balance between saving money by reducing the costs of bureaucracy, and ensuring weretain essential talent and capability through the transition to the new system and make it work for patients.

Resource Allocation

How will resources be allocated between commissioners?

Currently, the Department of Health makes revenue allocations directly to PCTs, targeted using aweighted capitation formula. The weighted capitation formula is overseen by the independent AdvisoryCommittee on Resource Allocation. Pace of change policy—which determines how quickly PCTs’ actualfunding moves towards the target allocation derived from the weighted capitation formula—is determinedby Ministers. The revenue allocations to be announced later this year will be made on this basis.

Our proposed changes to the current allocation of resources are set out in Liberating the NHS. Themajority of the PCT commissioning function would be transferred to Commissioning consortia; some wouldbe undertaken by a new independent NHS Commissioning Board, an organisation free from day-to-daypolitical interference, which would take over responsibility for commissioning guidelines and the allocationof resources from the Department of Health; and some would be undertaken by Directors of Public Healthin local authorities, working with a new ring-fenced local health improvement budget.

It is proposed that shadow allocations for 2012–13 will be published for Commissioning consortia in late2011, and actual allocations for 2013–14 in late 2012. These would be made on the basis of seeking to secureequivalent access to NHS services, in all areas, relative to the prospective burden of disease and disability.By 2013–14, Commissioning consortia would be responsible for managing the combined commissioningbudgets of their member GP practices, and using these resources to commission the best and most cost-eYcient outcomes for patients.



Allocations to Directors of Public Health in local authorities would be published on the same timescalesas for allocations to Commissioning consortia. The allocation formula for these funds would include a new“health premium” to target public health resources towards those areas with the poorest health to reduceavoidable ill health and health inequality. Local communities will be rewarded for success, to energise eVortsto improve public health and reduce health inequalities.

Commissioning primary care services (such as GP services, dentistry, community pharmacy and primaryophthalmic services) would be the responsibility of the NHS Commissioning Board, as will national andregional specialised services and maternity services.

During the transition, ACRA will continue to provide independent advice to the Secretary of State on thefunding formula for the allocation of NHS resources. We will seek, in making allocations in 2011–12, toreflect similar principles to the future statutory basis.

Further details about the future allocations process and the distribution of resources will be announcedin due course.

What arrangements are proposed for risk sharing between commissioners?

Analysis is being undertaken to help develop an understanding of the levels of risk that would be incurredby commissioners. This will inform the arrangements that are put in place to help Commissioning consortiaensure they have appropriate levels of risk and suitable measures to deal with these risks.

What arrangements will be made to safeguard patient care if a commissioner gets into diYculty?

The NHS Commissioning Board would be responsible for ensuring consortia are accountable for theoutcomes they achieve, their stewardship of public resources, and their fulfilment of the duties placed uponthem. The NHS Commissioning Board would have powers to intervene in the event, for example, that aconsortium is failing to fulfil its duties eVectively or where there is a significant risk of failure. For example,it is proposed that the Board could require remedial action or in the last resort, take over the consortium’scommissioning responsibilities or assign them to another consortium. The local authority would be able toraise concerns on prescribed matters to the NHS Commissioning Board

Specialised Services

What arrangements are proposed for commissioning of specialised services?

The White Paper proposes that the NHS Commissioning Board will commission certain services such asnational specialised services and regional specialised services as set out in the Specialised Services NationalDefinitions Set for a planning population of over one million. Liberating the NHS: Commissioning forpatients specifically asks consultees to consider whether there are any services currently commissioned asregional specialised services that could potentially be commissioned in the future by Commissioningconsortia.

How will these arrangements interface with the rest of the system?

We are consulting on specific questions raised in Commissioning for Patients about the ways in which theNHS Commissioning Board can eVectively engage Commissioning consortia in influencing thecommissioning of national and regional specialised services, how the Board and Commissioning consortiacan best work together to ensure eVective commissioning of low volume services and also what services thatare currently commissioned as regional specialised services could potentially be commissioned byCommissioning consortia in the future. We will consider the comments received as part of the working upof the detailed arrangements and the interface with the rest of the system.

October 2010

Written evidence from Tribal Group PLC (COM 28)

Tribal Group is one of the few private sector organisations with significant experience of supporting NHScommissioners to deliver improved health and better patient outcomes and is a leading supplier operatingwithin the Framework for External Support to Commissioners (FESC).

Tribal works with commissioners in long term transformation programmes using advanced tools andtechniques to deliver better health services at lower cost. We typically enter into long term risk and benefitshare contracts so that we have a direct stake in the speed and impact of our initiatives. We have majorcontracts with a number of Primary Care Trusts (PCTs) across England, the largest of which is in excess of£20 million for the nine Primary Care Trusts in South Central.

We therefore submit this evidence to the Health Select Committee to comment on the challenges to NHScommissioners, the opportunities for reform and the implementation challenges that arise from the WhitePaper “Equity and Excellence: Liberating the NHS”. We have also attached two case studies demonstratingpractical support for clinical led commissioning.



Improving Commissioning

We believe that the NHS needs strong commissioners to drive improvements in the health of thepopulation and to achieve the necessary improvements in productivity and quality and enable individualcitizen to make informed choices about the care that they receive and hold the NHS accountable for theoutcomes achieved.

Currently, commissioners do not have the capacity or capability to drive the changes required to deliverbetter patient outcomes and achieve the required improvements in productivity and eYciency. While WorldClass Commissioning has made progress, we believe it lacked the teeth to address poor performance moredirectly and it led to overly bureaucratic and “staged” responses to the assurance process.

In our view, most commissioners in the NHS still lack the basic information, technology and skills to makethe necessary impact.

Where we have succeeded in innovative public/private sector partnership models, it has been achievedthrough:

— Establishing the right balance of managerial and clinical input to commissioning decisions.

— Using advanced information management and technology services at scale.

— Introducing proven improvement techniques from the UK as well as internationally.

— Challenging pre-conceptions about the scale of improvement and the pace of change that can beachieved.

— Driving change through established programme management techniques and organisationaldevelopment.


We believe it is critical that clinicians are actively involved in all parts of the commissioning cycle so thatthey confirm the needs of the population, the relative shares of investment in health promotion and healthcare services and the support the management of health care providers to ensure that intended outcomes areachieved.

We are disappointed that PCTs have not made the progress required to develop Practice basedCommissioners (PbC). While PbC groups have typically concentrated on providing new models of primaryand community services, too few have actively been engaged in meaningful commissioning activities thatchange health care services for the better.

In one of our contracts in NHS Ashton, Leigh and Wigan (ALW), we saw that no progress in PbC hadbeen achieved when we began our partnership in September 2008. Within 18 months, we had worked withlocal clinicians to establish six viable PbC groups, introduced new tools and techniques, devolvedmanagement support from the PCT, established PbC business plans and developed 6 new major servicepathways covering Stroke, ENT, Breathlessness, Diabetes, Rheumatology and Ophthalmology. Thesepathways will improve patient outcomes and deliver in excess of £3 million savings per annum.Simultaneously, we have provided analytical tools and services which enable these groups to review theactivity provided and manage the performance of local health care providers.

These changes would not have been possible without:

— The unique partnership between the public/private sector.

— The determination to equip clinicians to play an active role in commissioning decisions.

— The collective understanding that practice-based commissioning needed to bring togetherclinicians and managers so that the respective skills could be harmonised.

— The vision and imagination of new clinical leaders and their desire to work side-by-side withcommissioning managers from the PCT.

As these PbC groups continue to mature and develop, they are able to understand variation in health careprovision in all settings (including primary care).

The private sector brought vision, energy, drive and commitment to the development of clinicalcommissioning in ALW. We believe that the models developed in NHS Ashton Leigh and Wigan providesstrong evidence for the eVectiveness of primary care clinical involvement in all commissioning activities.

The six PbC groups that work together in ALW are evolving into GP-led Commissioning Consortia.While they are already recognising that they need to work together to achieve meaningful impact on patientcare, they are only just beginning to understand their responsibilities for productivity improvement andpatient accountability. We would suggest that GP-led Commissioning Consortia, if constituted correctly,should provide greater opportunities for local people to engage in decisions about health and health careand the way resources are applied to address their needs.




Strong transitional support will be required to support the creation of GP-led Commissioning Consortiaand maintain the focus on productivity and quality. Beyond more detailed information about each of thereforms, we believe that the transition to 2013 will require:

— Strong management that works closely with the emerging clinical leaders to establish the newmodels of commissioning.

— A clear vision of the shape and style of GP-led commissioning and how they will access thenecessary management skills, tools and technologies that will be required.

The White Paper has caused a degree of organisational turbulence in PCTs and Strategic HealthAuthorities (SHAs) and this could threaten the pace of reform and in particular, the creation of the new GP-led Commissioning Consortia.

In our view, embryonic consortia will need to quickly establish the right balance of “buy, share, build”improvement strategies that will be needed to make progress alongside PCTs. They will need to accessindependent support and advice about the merits of diVerent options and to support them as theydemonstrate their new capabilities to the NHS Commissioning Board.

While PCTs and SHAs are safeguarding existing commissioning arrangements and productivity plans, thenew NHS Commissioning Board will need to accredit consortia and safeguard patients interests while newarrangements evolve.

We believe that consortia will need to be statutory organisations that have a clear blueprint. While theyare GP-led, they will need to be comprised of clinical and business acumen and be capable of designing andimplementing new service models.

Again, we believe that the private sector has a role to play in using innovation to deliver managementsupport, information technology and organisational development at scale. Within South Central, Tribal isdelivering a wide range of commissioning enablement services (CES) to nine PCTs that will providecontinuity as well as critical business services for evolving commissioning consortia. Economies of scale haveenabled these PCTs to receive world class tools and techniques at a fraction of the cost if they had procuredindividually.

Tribal works in partnership with the public sector and this means that in all of our contracts, there isconsiderable provision for staV development and skills transfer. Our commissioning partnerships are someof the most successful examples in the NHS and we have used our resources to help many NHScommissioners develop new skills, tools and techniques. As we look to the future and the needs of GP-ledCommissioning Consortia, we again look forward to working alongside NHS management resources andsupporting them in their new roles. We believe this will minimise redundancy costs, protect local knowledgeand enable consortia to be self suYcient in the medium term.

Case Studies

NHS Ashton Leigh and Wigan

NHS Ashton Leigh and Wigan (NHS ALW) entered into a three year strategic partnership with TribalGroup (Tribal)—one of a small number of national pilots under FESC. This programme is helping tocatalyse the redesign of health and social care services so that local people can access the right services, inthe right place, at the right time.

One of the five partnership objectives is “to improve financial management and generate savings whichwill be re-invested back into patient care”. Significant tangible achievements have been made in the first yearof this partnership on a range of fronts, including identified savings of over £3.5 million in 2008–09 to bereinvested in rebalancing health expenditure and improving health outcomes. To the end of August 2009,the contract has achieved:

— Over £3 million savings through new pathways of care that shift services from acute hospitals tomore convenient settings in the community.

— Over £2.2 million savings through acute invoice validation (AIV), reductions in baseline contractsand the introduction of new contract conditions.

— £0.35 million identified savings (recurring) in statin and Proton Pump Inhibitor (PPI) medicinesmanagement by switching patients from high to low-cost equivalents (PPIs are ulcer inhibitingdrugs).

— £1.2 million projected savings in April 2010 through the introduction of reduced tariVs.

— Tribal is also confidently forecasting £1 million savings from AIV in 2009–10.

The total value of the contract is £4.8 million, of which £2.3 million will be funded from “guaranteed”savings delivered by Tribal which results in a net “worst case” cost to the PCT of £2.5 million. The contractstates that the first £2.3 million of savings are to be paid to Tribal in full. Savings over and above the £2.3



million will be split on a basis of 75% to the PCT and 25% to Tribal. This sum is capped at £10 million, sothat after this value is reached, the PCT retains 100% of the additional savings generated. Any recurrentsavings beyond the first 12 months (after they have been realised) will be retained 100% by the PCT.

One of the five partnership objectives between NHS ALW and Tribal is “to apply international standardsand best practice that can benefit the residents of Ashton, Leigh and Wigan”. Working with the NHS ALWcommissioning team and primary care, Tribal has introduced new international best practice tools andtechniques, including the following:

— NHS ALW is the first PCT in the UK to deploy the Johns Hopkins operational population riskprofiling tool (ACGs7) widely regarded as the leading edge population and risk profiling tool inthe world.

— The MCAP8 utilisation management tool, has been deployed to provide clinically-basedassessments of weaknesses in the health system and identify why they occur; reviews have beencompleted for elective and non-elective care and a productivity programme for the short andmedium term is now underway.

— Working with Public Health, Tribal have completed world class health equity audits with SheYeldSchool of Health and Related Research for COPD, CVD and, Diabetes.

Early findings have demonstrated that 40% of unscheduled inpatients are in the wrong care setting.Introduction of pro-active discharge planning on two pilot wards reduced length of stay by two days.

Risk stratification found that a cohort of 4% of the population who consume 40% of the healthcareresources. A hospital at home service has been set up managing 100 patients most of whom would otherwisebe managed within the hospital setting. This group is now being targeted for evidence-based disease and casemanagement models following the international best practice. A re-ablement service has also been createdfor the frail elderly and this is showing over 95% patient satisfaction and reduction in social care costs. Thisis being linked to high-risk management programmes through the developing community matron services.

Commissioning Enablement Service, NHS South Central PCT Alliance

The nine PCTs of NHS South Central region (who make up the South Central PCT Alliance) entered intoa four year strategic partnership with Tribal Group (Tribal) through FESC, starting in January 2010, forthe provision of a Commissioning Enablement Service (CES). They spend £5.5 billion a year on the healthand wellbeing of the four million people in their communities. Geographically they stretch from MiltonKeynes in the north to the Isle of Wight in the south, covering the counties of Buckinghamshire, Berkshire,Oxfordshire, Hampshire and Isle of Wight.

The region is, overall, relatively aZuent compared with the national average and therefore receivesrelatively low funding allocations per head of population. There are however local areas of relativedeprivation and health inequalities eg in part of Portsmouth, Southampton and Slough, compared withmore aZuent areas such as Winchester and Wokingham.

The corollary to the relative prosperity of the region is that funding allocations are below average. This,at least in part, creates new challenges, including a constant struggle to keep the regional health economyin financial balance.

The relative wealth of populations in South Central is not matched by lower demands on the health systemand this has placed local commissioners in diYcult financial positions historically. Local people are typicallyvery informed, influential and demand the very best from the NHS.

In common with the rest of the NHS, commissioners in South Central face a significant financial challengeover the next five years. However, because South Central PCTs receive the lowest per capita allocation inthe NHS, as finances tighten a significant funding gap will need to be addressed and the health systems willneed to be re-sized to meet this.

Driving improvements through evidence based commissioning is central to the achievement of this goal.The CES is designed to achieve a step change improvement in the information and specialist analytics tounderpin PCT commissioning by supporting three key areas:

— Strategy—identifying the biggest opportunities for improvement in quality, outcomes andproductivity.

— Operational Planning—converting strategy to delivery through credible, consistent and cohesivecommissioning programmes.

— Performance Management—achieving and maintaining high performing health systems, using acomplex array of levers and system interventions.

7 ACGs provide the ability to develop clinically-led commissioning strategies on the basis of locality, disease, and predictedresource consumption. This enables the PCT to visualise and model the impact of “personalised” budgets for health andsocial care.

8 MCAP uses the intensity of services delivered to the patient based on the patient’s severity of illness to accurately determinethe best level of care for patient placement.



The total value of the contract is £23 million, of which a percentage is dependent on Tribal identifying£200 million of savings each year across the Alliance. To provide the PCTs with the information, evidence,and skills to drive out these savings Tribal has introduced new international best practice tools andtechniques, including the following:

— On the back of the work in NHS Aston Leigh and Wigan, Tribal is deploying the Johns Hopkinsoperational population risk profiling tool (ACGs9) widely regarded as the leading edgepopulation and risk profiling tool in the world

— The McKesson InterQual utilisation management tool has been deployed to provide clinically-based assessments of weaknesses in the health system and identify why they occur; reviews havealready been completed for non-elective care across all the major Providers in South Central. Earlyfindings have demonstrated that over 30% of unscheduled inpatients are in the wrong care setting,thus providing evidence for the health economy to plan ahead for more appropriate distributionof services.

— Support for detailed QIPP (Quality, Innovation, Productivity and Prevention) analyses.

— An Acute Invoice Validation Service that provides the confidence for PCTs to conduct negotiationsand arbitration discussions in a clear and assertive manner, which is evidence based, and whichstrengthens their position as an assertive commissioner of services with their main acute providers.

— Initial strategy development and subsequent detailed design to support the creation moremeaningful pathway improvement programmes that target single conditions (eg diabetes, stroke,etc) as well as addressing the issue of co-morbidities and those patients who require more complexservices involving multiple pathways.

— Development of tailored dashboards and analytics presentation tools to allow PCT staV toinvestigate and review evidence and knowledge captured in CES.

A key element of this contract is that the skills, techniques and tools will be transferred across to the PCTsas quickly as possible as time progresses to enable them to become self suYcient in their use of CES.

October 2010

Written evidence from UNISON (COM 43)

Executive Summary

UNISON has many concerns about the White Paper, and its impact on patients, staV and the NHS. Forthe purposes of this inquiry, these include the following:

— Attempting to force through so much change so quickly will be hugely expensive and will produceinstability that could aVect the quality of services and patients’ ability to access them.

— The creation of a larger role for the private sector is planned despite a track record of proven failureand despite concerns about conflicts of interest.

— There are significant question marks about how those responsible for commissioning will be heldto account.

Rather than boosting democratic legitimacy, the plans amount to a substantial downgrading of therole of democratically elected councillors in scrutinising health services.

— There will be geographical variations in the level and type of service available to patients.

— Mental health services and specialist services to treat patients with rare or complex conditionscould suVer.

— The White Paper is a missed opportunity to promote integrated care, and initiatives that promotegood practice and save the taxpayer money could be compromised, along with patient safety.

Introduction

1. UNISON is the major trade union in the health service and the largest public service union in the UK.We represent more than 450,000 healthcare staV employed in the NHS, and by private contractors, thevoluntary sector and general practitioners. In addition, UNISON represents over 300,000 members in socialcare. There is also a wider interest in the NHS among our total membership of more than 1.3 million peoplewho use, or have family members who use, health services.

2. UNISON has submitted an overall response to the government’s Liberating the NHS White Paper—the union’s submission to the Committee’s inquiry should be read in conjunction with this.10 UNISONwelcomes the opportunity to respond to the Committee’s latest inquiry, but given the very critical report on

9 ACGs provide the ability to develop clinically-led commissioning strategies on the basis of locality, disease, and predictedresource consumption. This enables the PCT to visualise and model the impact of “personalised” budgets for health andsocial care.

10 UNISON response to the White Paper, http://www.unison.org.uk/file/A11861.pdf



the same subject produced by the Committee’s predecessor just six months ago there is a danger that thenew inquiry will be viewed as an attempt to gloss over the previous Committee’s concerns. UNISON believesthe onus is on the new Committee to address and act upon the conclusions of the previous report,particularly to attempt to test the value for money of the purchaser-provider split described as representing“20 years of costly failure”. Providing some background to the new government’s health plans is important,but there is a wider consideration as to the actual validity of commissioning that should also be up fordiscussion.


3. The Committee asks about variation in clinical practice. Much has already been made of the potentialof the White Paper to produce a “postcode lottery” with patients experiencing varying levels of service acrossdiVerent parts of the country. Part of the remit of SHAs is to provide a strategic overview and coordinationof services within their region. The White Paper suggests that there may be some form of regional outpostsfor the NHS commissioning board, but it is not certain how many there will be. With a lack of regionalcoordination it is possible that neighbouring GP consortiums could oVer quite diVerent services to theirpopulations, a problem that Pulse has pointed out could be exacerbated by the fact that “some areas of thecountry are hugely more prepared for the challenges of GP commissioning than others”.11

4. The government states that overspending consortiums will not be bailed out, raising questions aboutwhether patients could see particular treatments suspended until their consortium gets its deficit undercontrol. The level of autonomy given to consortiums by the White Paper includes encouragement for themto “strip out activities that do not have appreciable benefits”—but who decides what these are and does thismean that some patients could lose access to vital services?

5. There are wider issues around health inequalities. A report by the National Audit OYce found thatricher populations tend to have more GPs per head than poorer ones.12 It is doubtful whether the NHScommissioning board will be able to influence the distribution of GPs or whether councils will have suYcientpower to aVect a change that benefits the poorest.

How Open will the System be to New Entrants?

6. The Committee asks about access to commissioning expertise. UNISON is concerned that the WhitePaper confirms that GP consortiums will be free to buy in commissioning support from private companies.Given the novelty of the new system for most GPs, commentators suggest that doctors will need “a greatdeal of organisational support”.13 It is quite possible that many consortiums will want to bring in expertisefrom NHS managers at PCTs or SHAs before they are abolished.14 But not all will choose to go down thisroute and companies can be expected to poach a number of NHS managers before they can cross directlyto consortiums.

7. It is likely that the White Paper will in eVect take the FESC (framework for procuring external supportfor commissioners) much further, despite the previous Health Committee raising major questions overwhether “the taxpayer is getting real value for money out of this costly exercise”.15 Even under the currentsystem, in which few PCTs have so far chosen to use the FESC, there have been problems. Apparently thescheme’s suppliers have committed to guaranteed savings of £18 million, but by the summer of 2009 £15million had been spent on the scheme16 with no discernible achievements. At Hillingdon PCT, where thefirst FESC contract was awarded to Bupa, the experience has not been a happy one: in August 2008 the chairof the PCT said he “could not see how these projects would result in value for money”.17 It was also revealedin August 2010 that NHS Northamptonshire had ended its FESC contract with United Healthcare a yearearly.18

8. The government has published nothing alongside the White Paper about how it will tackle conflicts ofinterest with private companies looking both to oVer commissioning support and to deliver services. Theexisting FESC framework does at least attempt to address such matters, but even this falls short. Forexample, the list of government preferred suppliers includes organisations such as Unitedhealth Europe thatalso deliver provider services in England. The DH attempted to allay fears by ensuring that commissionersare not working in areas where they also provide services. It is still possible, however, for a company to advisea PCT (or in future a consortium) on its commissioning decisions in advance of making a bid to provideservices in that area. Moreover, once a commissioner has successfully recommended a service foroutsourcing that service must be open to competition at a later date in order to abide by procurement andcompetition law, thus opening up a healthcare market for these same companies to come back and provideservices in.

11 www.pulsetoday.co.uk/story.asp?sectioncode%35&storycode%4126761&c%2, 11 August 2010.12 National Audit OYce, Tackling inequalities in life expectancy in areas with the worst health and deprivation, House of

Commons, 30 June 2010.13 David Furness of the Social Market Foundation, quoted in The Guardian, “Private health firms scent big opportunity in NHS

outsourcing plans”, 17 July 2010.14 Health Service Journal, “BMA GP leader lends support to managers”, 22 July 2010, p 5.15 House of Commons Health Committee, Commissioning, fourth report of session 2009–10, March 2010.16 House of Commons, written answer from Mike O’Brien to Norman Lamb, “NHS: Procurement”, 15 July 2009.17 Hillingdon PCT, Notes of the Audit Committee held on 1 July 2008.18 www.e-health-insider.com/news/6141/pct ends united health contract early, 9 August 2010.



Accountability for Commissioning Decisions

9. In terms of patients making their voice heard, UNISON is concerned about plans for the new HealthWatch, which as the “consumer champion” changes the health scrutiny emphasis away from citizeninvolvement and towards consumerism. The consultation document also proposes that local HealthWatchshould help individuals “exercise choice”, suggesting that these bodies could act as proponents of the marketin addition to their role as scrutineers acting to improve services on behalf of patients.

10. In terms of the role of the NHS commissioning board, UNISON is concerned such a body will notbe able to hold commissioners and GPs to account. There will be no PCTs or SHAs and given the vast rangeof responsibilities the board will have, there is a danger that accountability could suVer. Similarly theNational Patient Safety Agency is to be abolished with its responsibilities transferring to the board. Withouta dedicated body to promote patient safety, will focus be lost at a time when fears are growing that newsuperbugs such as NDM-1 are on the rise?

11. The White Paper and consultation on the new commissioning proposals refer to each consortiumhaving an “accountable oYcer” but there is no detail on who this should be and what their responsibilitieswould involve. Experts have suggested that while the roles of accountable oYcer and financial oYcer arecritical, accountability is about more than just these roles; it is about a system and having the appropriategovernance and culture in place.19

12. Even now some rogue operators do slip through the net. For example, the GP run company TakeCare Now was the subject of a damning report from the CQC following the death of a patient who was givenan overdose of diamorphine by a locum doctor in 2008. Without strong accountability mechanisms, the newsystem could make it harder to isolate and punish rare cases of malpractice.

13. In terms of public health, there is concern that local authorities will increasingly be encouraged tofocus on the delivery of actual healthcare services (through health and wellbeing boards and the local HealthWatch) rather than wider issues of public health and prevention. Professor Steve Field of the Royal Collegeof GPs has acknowledged that “there is a risk here, especially as not every GP has a great knowledge ofpublic health”.20 Even those local government leaders who welcome their new public health responsibilitiesacknowledge that in the current financial climate there “may be a challenge that says, can we aVord this? Isthis our core business?”21

Integration of Health and Social Care

14. Although the government claims its proposals will strengthen integrated working between health andsocial care, there is little detail in the White Paper to back up this assertion and no meaningful health-localgovernment interface. In fact, the accompanying consultation document on outcomes confirms that therewill be separate outcomes frameworks for the NHS, public health and social care, which may inhibitintegrated working. Speaking on behalf of providers of care, the English Community Care Associationvoiced a “major concern” that the White Paper “does not acknowledge strongly enough the pivotal role ofsocial care in the development of an integrated approach to supporting citizens.”22

15. There is too much focus in the personalisation agenda on personal budgets when other ways ofensuring more personal and appropriate care would be more eVective. The White Paper suggests thatpersonal health budgets will be extended without considering whether the existing pilot process hasdemonstrated their success or not: the pilots will merely be used “to inform a wider, more general roll-out”.Personal health budgets could also encourage pressure for patients to be able to top-up their care with theirown money. Managers involved in the initial pilots have voiced such concerns, in addition to issues aroundequity, in a report on the early experiences of the programme.23

What will be the Role of Local Authorities in Public Health and Commissioning Decisions?

16. The White Paper and accompanying consultation on local democracy legitimacy make much ofgovernment plans to bring democratic legitimacy to the NHS but the detail does not back up this positiverhetoric. Plans to create health and wellbeing boards within local authorities will be at the expense of healthoverview and scrutiny committees (OSCs), which the Local Government Association states “have made areal diVerence in championing the public interest and challenging health commissioners and providers todeliver better health services.”24

17. More significantly, health and wellbeing boards will actually lack the essential democratic ingredientof OSCs. OSCs consist entirely of democratically elected councillors, whereas health and wellbeing boardswill only have to include one elected individual (likely to be the mayor or council leader). The rest of theboard would be made up of unelected individuals, such as senior local government oYcials andrepresentatives from GP consortiums. Although there will be local discretion as to the exact make up of

19 Health Service Journal, “GP governance: handle with care”, 12 August 2010.20 “Fears public health may be hit in shake-up of NHS”, 29 July 2010, www.bbc.co.uk/news/health-1078991121 David White, chief executive of Norfolk County Council, The Management Journal, “Public health is coming home”,

5 August 2010.22 www.ecca.org.uk/index.php/press-releases-2010/july-2010/259-government-white-paper.html, 13 July 2010.23 Department of Health, Early experiences of implementing personal health budgets, 14 July 2010.24 Local Government Association, Local Government Group Briefing—Health White Paper, 13 July 2010.



boards, there need be no involvement from backbench councillors. Independent elected representativesshould have the right to investigate commissioners and providers of healthcare, and to demand answers onbehalf of the citizens they represent. As currently constituted, the plans represent a major downgrading ofthe councillor role in scrutinising local decisions.

18. There are also question marks about just how much influence health and wellbeing boards will be ableto exercise over GP consortiums, particularly as consortium boundaries will not necessarily mirror those ofthe local authority—at the moment this is easier as PCT areas are largely coterminous with local authorities.This disparity could hamper partnership working across health and local government.

How will the New Arrangements Strengthen Commissioners against Provider Interests?

19. The Committee asks how vulnerable groups of patients will be provided for. This is another majorarea for concern. Charities have expressed fears that mental health services could suVer under new plans,with GPs themselves expressing concern about their ability to commission these services.25 A survey byRethink found that only 31% of GPs felt equipped to take on the role of buying in mental health servicesfor patients.26

20. End of life care is another area that charities are concerned for. An ageing population means that morepeople will be dying with more complex needs, and Help the Hospices have stated that “our biggest concernis that people will die badly if GPs are not supported to develop the knowledge and expertise they need tocommission the best palliative care.” In order to preserve fairness and transparency for the vulnerable,services “need to encompass not only mainstream health services but also meet the social, emotional andpsychological elements that are so central to hospice and palliative care.”27


21. The previous Health Committee noted that “constant re-organisations and high turnover of staV”have not helped the NHS. Previous reorganisations of the NHS have generally taken place at a time whenfinancial resources are not being squeezed. This time, however, the NHS as a whole is expected to makesavings of around £20 billion over the next four years. The White Paper itself contains plans to make hugecuts of more than 45% in management costs, so major structural change is to be achieved with far less moneyand fewer managers. Those working for SHAs and PCTs will be expected to bring about massive change,despite the fact that their organisations are in line for abolition within the next three years.

22. Forcing through so much change, and in a very short timeframe, is bound to produce instability.Something which NHS chief executive David Nicholson acknowledged in his letter to fellow NHS leadersfollowing the publication of the White Paper: “Learning the lessons from past reorganisations, there issignificant risk, during this transition period, of a loss of focus on quality, financial and performancediscipline as organisations and individuals go through change.”28

23. In terms of safeguarding good practice, good initiatives that have helped staV to provide better carefor patients (and more eYcient care for taxpayers) could suVer as a result of the review of arm’s-length bodiesassociated with the White Paper. The chief executive of the NHS Institute for Innovation and Improvementhas stated that there “must be” some risk that the Institute’s work on quality improvement could suVer nowthat its remit will transfer to the NHS commissioning board.29

24. There are particular fears that the impact of successful programmes such as the Institute’s ProductiveWard series will be lessened. Evaluations of the initiative have found that it has “huge perceived value andlocal impact” as it seeks to free up nurses to spend more time with patients by streamlining processes suchas handovers; it aims to help the NHS save £9 billion. National Nursing Research Unit director PeterGriYths said: “It does seem clear that it will be harder to develop, coordinate and marshal resources behindthese sorts of developments in a more decentralised system.”30

25. In terms of transitional costs, there is likely to be a massive expenditure at a time when the NHS canill aVord waste. The Department of Health has already set aside £1.7 billion in 2010 for reorganisation, withother commentators suggesting the overall cost will be much higher. Writing in the British Medical Journal,Professor Kieran Walshe of Manchester Business School estimates that “the proposed NHS reorganisationwill cost between £2 billion and £3 billion to implement at a time of unprecedented fiscal austerity”.31

25 Professor Steve Field, Royal College of General Practitioners, quoted in The Observer, “Fears grow over care of mentally illas GPs say they don’t want the job”, 18 July 2010.

26 “White paper to hand mental health commissioning to GPs, but most don’t have necessary expertise”, 12 July 2010,www.rethink.org/how we can help/news and media/press releases/white paper to hand.html

27 “Help the Hospices response to NHS white paper”, 12 July 2010, www.helpthehospices.org.uk/media-centre/press-releases/response-to-nhs-white-paper

28 Department of Health, David Nicholson letter to Chief Executives, 13 July 2010.29 Health Service Journal, “Institute axed in £180 million review”, 29 July 2010.30 “Nursing improvements under threat as quangos face cull”, 3 August 2010, www.nursingtimes.net/5017873.article?

referrer%e2631 Professor Kieran Walshe, “Reorganisation of the NHS in England”, British Medical Journal, 16 July 2010.



Specialist Services

26. With the profit motive set to become a more important consideration for those competing within thehealthcare market, it is logical that providers will focus most of their attention on oVering those servicesthat make the most money, meaning that those yielding less cash may be ignored. This could have majorconsequences for patients suVering from rare and complex conditions who find they are increasingly unableto get treatment near to where they live. National and regional specialised services will be the responsibilityof the NHS commissioning board, but the Specialised Healthcare Alliance has voiced “immediate concerns”about the need for regional structures to support specialised commissioning.32

October 2010

Written evidence from the Association of Directors of Public Health (COM 47)

The Association of Directors of Public Health (ADPH) is the representative body for directors of publichealth (DPH) in the UK. It seeks to improve and protect the health of the population through DPHdevelopment, sharing good practice, and policy and advocacy programmes. www.adph.org.uk

ADPH has a strong track record of collaboration with other stakeholders in public health, including thoseworking within the NHS, local authorities and other sectors.

The ADPH welcomes the opportunity to input to the Health Select Committee Inquiry intoCommissioning.

This submission follows consultation and involvement with our members—Directors of Public Health—in England, along with input from members in the other UK countries, who have valuable experience ofother structures and ways of working.

ADPH will also be submitting responses to the NHS White Paper and related documents. We recognisethat the NHS White Paper and the structural changes it heralds in England raise huge opportunities forpublic health, but with such changes there are also risks. In this submission, we seek to highlight key issuesthat we believe will need to be addressed to ensure real improvements in commissioning, health care servicesand outcomes and the reduction of health inequalities.

1. The Role of Public Health in Commissioning

Public Health oversight of and public health input to commissioning at all levels will be essential toachieve real improvements in population health outcomes and the reduction of health inequalities.

Commissioners should be required to demonstrate the use of a strategy covering high quality, universalservices, targeted services for communities of interest at greater risk especially deprived communities andtailored services for people with multiple and complex needs. This should be underpinned by evidence base,public health intelligence and needs assessments.

Also needed is the demonstration of excellence in managed entry of new drugs, technologies and publichealth interventions. We recommend the promotion of Health Impact Assessment (HIA) and Health Equityaudit as necessary components in commissioning service change (capital or design) alongside equality anddiversity impact assessment.

Perhaps the greatest challenge to the new NHS will be how to put prevention at the heart ofcommissioning. Given that the new structure will put health care and prevention into separate organisationswith diVerent outcome frameworks, geographical boundaries, cultures and systems for accountability, thereare considerable risks.

The combined cost to the NHS of smoking, alcohol and obesity has been put at £11 billion, roughly 10%of the NHS budget, with half of that cost attributed to smoking alone. Failing to engage primary careeVectively in preventative medicine will impose burdens to the public in terms of ill-health, consortia in termsof a heavier work load and the NHS as a whole in terms of unaVordable costs. Ensuring that the two newservices (public health and health care) work together eVectively must be of the highest priority. Currentproposals for the NHS Outcomes Framework should be reviewed to include specific public healthindicators.

Consortia should be encouraged to adopt boundaries which match or fit within existing local authorityboundaries. Consortia governance structures should include a dedicated place for public health. EVectivejoint planning and integrated delivery should be a requirement placed on both consortia and the new PublicHealth Service.

Urgent consideration will need to be given as to how best to structure and maintain clear lines ofaccountability, communication and access between the Public Health Service and both Public Health teamsworking within Local Authorities and the GP consortia.

32 Health Service Journal, “Concerns over standard of specialist care”, 22 July 2010.



2. National Issues

2.1 Public Health Service

We believe that the Public Health Service should provide public health expertise and input tocommissioning, including:

— evidence-base advice and support function with input into GP consortia commissioning andservice quality;

— strategic expertise and input into specialist commissioning;

— public health expertise into the NHS Commissioning Board to support its role in providingnational leadership in commissioning for quality improvement, commissioning national andregional specialised services, and allocating NHS resources; and

— public health input to prescribing and medicines management.

The above being supported by its wider remit which should necessarily include:

— information and intelligence functions—observatories; cancer registries etc;

— screening and other QA programmes;

— scarce resources—such as dental PH; infection control etc;

— audit and evaluation;

— Public Health input to regulatory organisations/functions;

— Public Health input to provider organisations/Trusts;

— Health Protection national functions; emergency planning;

— Investment in the Public Health workforce (specialist and practitioner)—both practice anddevelopment;

— Investment in the Public Health academic function; and

— a remit to promote full understanding by politicians (national and local) of the DPH role and allkey Public Health functions.

As highlighted above, urgent consideration will need to be given as to how best to structure and maintainclear lines of accountability, communication and access between the Public Health Service and both PublicHealth teams working within Local Authorities and the GP consortia.

2.2 NHS Commissioning Board

Public health expertise will be required by the NHS Commissioning Board to support its role in:

— providing national leadership in commissioning for quality improvement;

— commissioning national and regional specialised services; and

— allocating NHS resources.

Commissioning of national and regional specialised services: The NHS Commissioning Board mustensure that consortia work in close collaboration with Directors of Public Health and the Public HealthService and Local Authorities to ensure that specialised services are delivered at the appropriategeographical level. Where joint commissioning structures are established to provide more eVective andeYcient services for large population areas, the Commissioning Board should ensure that Directors of PublicHealth are involved to ensure that population health gain is maximised.

Ensuring eVective local commissioning: The Commissioning Board should ensure that localcommissioning is undertaken with due regard to public health and preventative medicine and with the activeinvolvement of Directors of Public Health.

Governance of GP consortia: EVective delivery of public health outcomes is as important an issue asreporting and audit. Consortia should demonstrate to the Commissioning Board that they and theirconstituent practices have proper processes in place to ensure that they are playing an active and evidencebased role in population health improvement and prevention of illness.

Consortia should be expected to develop commissioning plans which reflect population need as identifiedin the Joint Strategic Needs Assessment. The National Commissioning Board should use an assessment ofthe extent to which needs are addressed within the performance assessment of Consortia.

The Commissioning Board should hold consortia responsible for ensuring that GP practices dischargeeVectively the preventative health aspects of primary care; and the Outcomes Framework should incentivisethese functions.

Commissioning outcomes framework: A commissioning outcomes framework should include key publichealth indicators including those for long term conditions and lifestyle factors such as tobacco and alcohol.



3. Local Issues

Locally, the Director of Public Health should provide oversight and the Public Health team input to GPconsortia commissioning, supported by additional resources and expertise held within the Public HealthService.

We believe that GP consortia should work closely with Local Authorities and that local commissioningplans should be subject to scrutiny and comment by the Health and Well-being Board—and to greatest eVectwould also be signed oV by the Board.

Directors of Public Health will also commission health improvement services through the proposed localring-fenced public health budgets.

3.1 GP consortia

To support eVective commissioning decisions that will bring real improvements in population health anda reduction in health inequalities, GP consortia will require access to and clear lines of communication with:

— Health and Well-being Boards;

— well-resourced and professional local Public Health teams, including public health commissioningexpertise, that are co-located with the DPH, providing the skills and experience to input to localservice planning and commissioning, and to deliver Public Health programmes and advice acrossthe health economy, supported by access to high quality local and national data and scientificevidence base;

— cross-agency/sector needs assessments (JSNA);

— Public Health information and intelligence providing relevant and timely intelligence; and

— the national Public Health Service for evidence-based advice to support commissioning andservice quality.

EVective commissioning: Whether a service is commissioned and delivered nationally, regionally orlocally is a decision which should be based on the evidence of eVectiveness. Consortia should be encouragedto develop structures for stable joint commissioning where these would best serve their population. Thesewill often include city-wide and regional commissioning. These commissions should be made on a time-scalethat will allow stable service planning and delivery.

Ideally consortia boundaries should be contained within one local authority—enabling a relationshipwith one Local Authority Director of Public Health and public health and social care teams.

In setting priorities and in measuring success, commissioners require access to good, standardised data todescribe their populations and compare them with those around them. This “benchmarking” is an importantcommissioning function. Good benchmarking data and tools are emerging, available at PCT and LocalAuthority levels. However, if consortia are not coterminous with Local Authorities and the boundaries ofconsortia shift over time as practices join or leave, then eVective benchmarking becomes less feasible.

Reducing inequalities in health: Health inequalities will only be reduced with action on the widerdeterminants of health. Many of these are aVected through Local Authority based services andcommissioning (eg Planning, Housing etc). Tackling the main social and behavioural drivers of healthinequalities is something that can only be done in collaboration with Directors of Public Health within LocalAuthorities. Smoking, for example, is the largest cause of health inequalities, accounting for half thediVerence in life expectancy between richest and poorest in society. EVective collaboration with the newPublic Health Service will be crucial in reducing inequalities and dislocation between the services will bepotentially disastrous. Robust structures will be required to ensure that consortia are active and eVectivepartners in the planning and delivery of public health measures, particularly those geared to reduce healthinequalities.

3.2 The role of the Director of Public Health in Commissioning

Directors of Public Health will be responsible within their defined population for the delivery of:

— measurable health improvement;

— Health Protection including emergency response;

— oversight of and support for health and care service planning and commissioning; and

— reduction of heath inequalities.

To successfully deliver this they will require the authority to have oversight and influence across: LocalAuthorities; the NHS—including primary care; and other agencies and sectors, to ensure a populationapproach across all the determinants of health. It is essential to align the responsibilities, power andauthority of Directors of Public Health to achieve these outcomes.

The core purpose of the Director of Public Health is to act as an independent advocate for the health ofthe population and to provide leadership for its improvement and protection. As such it should be a high-level statutory role bridging Local Authority and NHS responsibilities for health and well-being for a



defined population. As the leader of the local Public Health System, DsPH should ensure that better healthoutcomes are delivered through the provision of authoritative influence across all the Directorates withinthe Local Authority; the NHS; voluntary organisations and the business and industry sector.

Directors of Public Health will also commission health improvement services through the proposed localring-fenced public health budgets.

In support of their role, Directors of Public Health (DPH) will need well-resourced and professionalPublic Health teams, including public health commissioning expertise, that are co-located with the DPH,providing the skills and experience to input to local service planning and commissioning, and to deliverPublic Health programmes and advice across the health economy, supported by access to high quality localand national data and scientific evidence base.

3.3 Health and Well-being Boards

Local commissioning also relates to proposals within the NHS White Paper for local democraticlegitimacy in health, and so below we highlight some issues relating to the remit of Health and Well-beingBoards:

— The remit of the Boards should explicitly include the three public health domains of healthimprovement, health protection, and health care service planning and commissioning.

— Scrutiny of local commissioning plans should rest with Health and Well-being Boards—and togreatest eVect would also be signed oV by the Board.

— The Director of Public Health should act as a principal advisor to the Health and Well-being Boardfor public health advice across the three public health domains of health improvement, healthprotection, and health care service planning and commissioning.

We believe it would be beneficial to establish Boards early (in shadow form) to maximise early learning.

It is important that in two tier authorities the existing health and well-being partnerships continue to worktogether for the health and well-being of the local population. We believe that District Authorities shouldhave specific roles and duties for the improvement and protection of health.

4. Key and Immediate Issues of Concern

The process of transition itself carries risks, and it will be important to recognise and mitigate those risksto ensure the longer term success of the new commissioning arrangements.

The most serious and pressing concern is the impact of current (and future) local financial savings andconsequent risks to public health capacity and capability to support eVective commissioning—as a depletedservice will be unable to respond eVectively to public health priorities and support the new commissioningarrangements.

ADPH has significant concerns that the loss of local public health capacity and capability will seriouslyrisk the success of the reforms envisioned in Liberating the NHS. This is an issue that needs to be recognisedby government and urgently addressed by PCTs, Local Authorities, SHAs and GP consortia as they worktogether on transition.

October 2010

Written evidence from The NuYeld Trust (COM 66)

This submission of evidence is made to the Health Select Committee by The NuYeld Trust, a charitabletrust carrying out research and policy analysis in health services.

Summary

— The NuYeld Trust supports the concept of clinically-led commissioning, and the associatedprinciple of maximising clinicians’ involvement in health service planning, funding and servicedevelopment decisions. We believe that general practitioners (GPs) and specialists should be jointlyinvolved, with the associated ability to take “make or buy decisions” unrelated to personal income.

— We consider the recent White Paper proposals to respond in part to the diagnosis we set out in ourmonograph “Where next for commissioning in the English NHS?”

— In particular we welcome the allocation of real and risk-adjusted capitated budgets to consortia ofGPs, along with responsibility for service quality and health outcomes.

— Our concerns about the proposals focus on six issues:

— the likelihood that GP Consortia will be unable to control expenditure any more successfullythan PCTs before them, at least in the short term;

— the focus on GP rather than wider clinical commissioning;



— the decision to have a strict separation between the commissioning and provider activity ofconsortia;

— the removal of the PCT as local system manager;

— the statutory nature of GP consortia and the potential consequences for GP engagement; and

— the extent to which GPs feel enthusiastic and incentivised to get involved in commissioning inan active manner.

1. Introduction

1.1 The NuYeld Trust has a mission to promote improvements in the quality of healthcare and healthpolicy, with the aim of improving patient care and public health.

1.2 As a team we have been engaged in research and policy analysis of NHS commissioning for over 15years. Recent relevant work includes:

— synthesis of research evidence and policy analysis of possible commissioning futures (NuYeld Trustand NHS Alliance,2009; Smith et al, 2010);

— two-year action research study of commissioning of care for people with long-term conditions(funded by National Institute of Health Research);

— development of person-based risk-adjusted resource allocation formula for practice-basedcommissioning—used in allocations across England from 1 April 2010;

— development of predictive risk techniques for application to social care costs alongside health carecosts (Bardsley et al, forthcoming);

— policy analysis of the implications of GPs assuming real budgets for commissioning (Smith andThorlby, 2010); and

— international comparative study of primary care-led commissioning, including the US, NewZealand, and Australia.

1.3 In this submission of evidence, we examine four of the themes set out in the brief for this Inquiry, usingresearch evidence and our wider experience to draw out the key lessons for policy and practice.

2. Clinical Engagement in Commissioning

2.1 Research evidence consistently underlines the importance of eVective and sustained clinicalengagement in commissioning.33 Primary care-led commissioning is predicated on a belief that makingclinicians directly responsible for health care resources will encourage them to make commissioningdecisions which are more relevant to patients’ needs and the specific local issues in health service provision.

2.2 In a review of evidence on practice-based and PCT commissioning (Smith et al, 2010) we concludedthat these recent forms of NHS commissioning had largely failed to engage clinicians in a significant orsustained way. We suggested that a more radical form of clinician-led commissioning should be considered,as part of an overall strengthened continuum of commissioning arrangements co-ordinated and held toaccount by fewer and larger PCTs.

2.3 We support the proposal in the NHS White Paper for GP commissioning consortia to hold real (asopposed to indicative) capitated budgets for the purchasing of local health services, and for these groups tobe held to account for health outcomes, patient experience of services, and financial performance. GPconsortia oVer the promise of a more “real” form of primary care-led commissioning that is likely to engageat least some GPs in health planning, funding and service development in a very active manner, and to enactchanges without facing some of the bureaucratic hurdles that proved a frustration with practice-basedcommissioning.34

2.4 We do however have six main concerns about the proposed policy on GP commissioning, issues thatwe had anticipated in a briefing paper we developed in partnership with five national organisations in May2010.35 These six concerns are.

2.5 We believe that under the current plans GP Consortia will be unable to control expenditure any moresuccessfully than PCTs before them. The likelihood is that in the short term, consortia will be less likely tocontrol expenditure (on hospital care) because they will be in a process of organisational development andunder-resourced to do this job. To control hospital expenditure, while achieving quality of care, consortiamust link closely with specialist colleagues in hospital, and invest in the management and informationinfrastructure necessary.

33 Smith JA, Curry N, Mays N and Dixon J (2010) Where next for commissioning in the English NHS? London, the NuYeldTrust and the King’s Fund: http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%694.

34 NuYeld Trust and NHS Alliance (2009) Beyond Practice-Based Commissioning: the local clinical partnership. London, theNuYeld Trust and NHS Alliance: http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%659.

35 Smith JA and Thorlby R (2010) Giving GPs budgets for commissioning: what needs to be done? London, The NuYeld Trust,King’s Fund, RCGP, NAPC, NHS Alliance and NHS Confederation. http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%712.



2.6 We question the strict focus on GP rather than wider clinical commissioning and in particular howconsortia will be incentivised to find ways of working closely with specialist colleagues in community, mentalhealth, and secondary care services to develop new and more integrated services for patients. In the currentfinancial context, the main challenges faced by GP commissioners (Dixon, 2010) will be in the areas ofmanaging demand for hospital care, reducing avoidable admissions,36 addressing large and unaccountablevariations in clinical practice, and developing integrated care for people living with long-term conditions.Research evidence shows that primary care commissioners in the past have focused mainly on extendingprimary and community care services, and on marginal improvements in elective care, struggling to haveany impact on secondary care services (Smith et al, 2004). In three recent monographs, the NuYeld Trusthas examined the ways in which GPs and specialists might work together within multi-specialty groups todesign and implement new approaches to more integrated care.37

2.7 To have consortia focused purely on commissioning raises questions about (a) how real thisseparation of commissioning and provision can be and (b) if it is real, the extent to which consortia will beable to lever desired changes both from their colleagues across primary and secondary care, and about thebureaucracy and transaction costs that may ensue. One of the key strengths of primary care-ledcommissioning is its ability to enable “make or buy” decisions where clinical commissioners deliver as muchcare as possible within practice-based settings, and then purchase other services that maximise the possibilityof more integrated care for patients. We believe this separation between commissioner and provider couldlead to conflicts of interest (as in the case of GP fundholding) which could undermine public trust in generalpractice. Arrangements must be made to mitigate this potential conflict, in particular by ensuring that thepersonal income of GPs (or in future, specialists) is unrelated to savings made on commissioning budgets.

2.8 The removal of the PCT as the local system manager. We believe that commissioning is mosteVectively undertaken at diVerent levels of the population, in order to manage financial risk, for economiesof scale, and to concentrate necessary skills. In the post-White Paper world, services will be commissionedthrough: personal health budgets; practice networks; GP consortia; joint commissioning with localauthorities; multi-consortia networks; and the NHS Commissioning Board. There is a need to determinewho, in the absence of PCTs, will co-ordinate the local “continuum of commissioning” (Smith et al, 2004),and hold local providers to account, thus ensuring that services, and more importantly patients, do not “fallthrough the cracks” between organisations. Furthermore, it will be important for the Department of Healthand SHAs to ensure that extremely robust local system management is in place during the period oftransition, especially in relation to financial control, clinical governance and the meeting of the manystatutory requirements currently located with PCTs.

2.9 The decision to remove all PCTs from the health system and make GP-led commissioning the mainand statutory health funding and commissioning bodies marks this reform out from previous experimentswith GP-led purchasing. This flies in the face of UK and international research evidence on primary careled commissioning which points to the importance of such groups not being seen as “other” or as belongingto the state but as being clearly owned and run by GPs (NuYeld Trust and NHS Alliance, 2009; Casalino,2010). The extent of financial responsibility to be placed in the hands of GPs makes the statutory natureof such consortia an inevitable and understandable decision. However, research evidence suggests that theformality and extent of such responsibility (in particular in a period of financial austerity) may compromisethe desire for engagement of front-line practitioners.

2.10 It is questionable how far the majority of GPs feel enthusiastic about, and engaged in, the idea ofbecoming the main NHS commissioners. We know from research studies that practice-based commissioninglargely failed to engage GPs in a significant manner and even GP fundholding in the 1990s, with very clearand personal incentives for GP engagement, only reached 50% take-up after seven years. It is not yet clearwhat the incentives will be for GPs to participate actively in GP commissioning. The current suggestion isto link a proportion of practice income to commissioning performance, although this is likely to be diYcultto implement in a manner that is suYciently nuanced to provide suYciently direct personal incentives forGPs. Research also highlights the importance, and the transactions costs, of commissioning consortiaspending time and energy in staying connected with constituent practices and staV. This will be particularlychallenging if consortia are large in size.

3. Accountability for Commissioning Decisions

3.1 The move to GP commissioning should give people a clearer sense of connection to their healthcommissioners than is currently the case with PCTs, the latter largely lacking local legitimacy and profile(Glasby et al, 2010; Thorlby et al, 2008; Smith et al, 2010). Most people are registered with, and use, GPservices, with 80% of people having contact with their GP in any one year.

36 Blunt I, Bardsley M and Dixon J (2010) Trends in emergency admissions in England 2004–09: is greater eYciency breedingineYciency? London, the NuYeld Trust: http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%714.

37 See Lewis R, Rosen R, Goodwin N and Dixon J (2010) Where next for integrated care organisations in the NHS? London,the NuYeld Trust and King’s Fund: http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%693; NuYeldTrust and NHS Alliance (2009) Beyond Practice-Based Commissioning: the local clinical partnership. London, the NuYeldTrust and NHS Alliance: http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%659; and, Ham C andSmith JA (2010) Removing the policy barriers to integrated care in England. London, the NuYeld Trust: http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%721.



3.2 It is possible that statutory GP commissioning consortia will have public and/or non-executivemembership of their boards. Whilst this would clearly confer a degree of public accountability, researchsuggests that wider involvement of other stakeholders in clinical commissioning makes it harder to sustainclinician engagement. The influence of patients, the public and other health professionals at board level ofprimary care-led commissioning has not often been significant in relation to strategic decision making(Smith and Goodwin, 2006; Dowling and Glendinning, 2003). There will thus be trade-oVs to be madebetween public and professional engagement within new commissioning arrangements.

3.4 We anticipate that the NHS Commissioning Board will quickly become the “headquarters of theNHS” to which consortia will look for guidance, approval, performance management, and direction—especially in the challenging economic climate. Given the Board’s proposed range of functions, it seems tous likely that it will become large in size and need to operate through regional outposts. Indeed, it will clearlyfall in part to the NHSCB to provide eVective local system management, along with GP consortia.

3.5 The NHSCB will have a critical role as the overall funder of NHS commissioners, undertakingresource allocation, designing templates for services, and holding GP commissioners to account for theirperformance against the NHS Outcomes Framework. It is as yet unclear how the role of the Board will relateto the economic regulator and the Care Quality Commission. It will be important that the regulatoryframework for commissioning is proportionate and not unduly cumbersome, since this could furtherundermine the likelihood of eVective GP engagement in commissioning.

3.6 The NHSCB will need to develop a failure regime for GP commissioners, and the relationship of thiswith the General Medical Services contract will be critical. The NHSCB will hold the individual generalpractice contracts for GPs as providers, as well as holding GP commissioning consortia to account. Thisposes a question as to whether and how these two areas of general practice activity will be jointlyperformance managed at national level. National management of and accountability for general practiceservice delivery appears to be a retrograde step, considering the progress that has been made by many PCTsin managing locally tailored practice contracts.

3.7 A key challenge within the new arrangements is how hard choices will be made, and who will be heldresponsible for these. We highlight two main issues, drawing on previous (Edwards, 2007) and current(Coster, forthcoming) NuYeld analysis of the role and function of national independent health boards.First, we would question how far the NHSCB will be able to remain truly independent of the Secretary ofState and the Department of Health when faced with diYcult local rationing decisions. We suggest there isa need for formal circumscription of the scope of the Secretary of State and the Department of Health tointervene in the work of the NHSCB, albeit there will need to be arrangements for the NHSCB to accountto Parliament in an appropriate and transparent manner. Second, there is a need for careful considerationof how patients will respond to their GP if and when they know that s/he is responsible for deciding whatservices are or are not funded locally.

4. Integration of Health and Social Care

4.1 In the short to medium term, the process of transition from PCT to GP commissioning risksundermining vital work to promote the integration of health and social care. Joint working across the NHSand local government requires the nurturing of long-term relationships between managers andprofessionals. The restructuring of NHS commissioning typically entails changes in key personnel, and theneed for local government to get to know new NHS leaders and to reorganise some of its own boundariesand governance arrangements in order to work in an eVective manner with NHS bodies.

4.2 In the medium to long term, the move of public health from the NHS to local government shouldenable public health specialists to focus more firmly on the wider health agenda and co-ordinate plans forhousing, education, transport, the environment and so forth with the work of the local NHS. There ishowever a parallel risk of public health becoming divorced from NHS service planning and provision, andof GP commissioners finding it hard to access essential and timely public health expertise in needsassessment, priority setting, service evaluation, and the monitoring of health outcomes.

4.3 The proposal to establish local health and wellbeing boards suggests a potentially stronger role forlocal authorities in health commissioning, with public health and local government coming together toprovide overall scrutiny of the work of GP commissioners. How far these LHWBs will have “teeth” isdiYcult to say—they may be little more than the “talking shops” that many previous joint commissioningboards and groups have become. Alternatively, with an appropriate degree of supervisory “clout” (as yetundefined), they might start to take on the role of coordination of the local health system, in the absence ofthe PCT and as a statutory (and usually long-standing) local body that is well-known to the public and hasitself significant experience of commissioning social and other care.

4.4 GP commissioning consortia will relate to Health Watch, the Public Health Service, and to localhealth and wellbeing boards, yet research evidence suggests that this may prove challenging (Smith andGoodwin, 2006; Dowling and Glendinning, 2003). GP commissioners typically prefer to focus on clinicalservice commissioning reflecting their training and experience and have historically been less willing toengage with broader population health commissioning. In respect of developing patient engagementmechanisms, GP commissioners will arguably face a conflict of interest as providers of local services, andmay need external support to carry out this function.



4.5 Given that NHS commissioning arrangements are being reformed at a time of health and localgovernment financial constraint, it will be important for LHWBs, together with GP and social carecommissioners, to be able to track changes in the use of NHS and social care for specific patient groups.Data linkage work pioneered by the NuYeld Trust enables an assessment to be made of utilisation of healthand social care services at a person level. This provides a basis for commissioners to explore potentialsubstitution of NHS care for social care and vice versa.

5. Resource Allocation

5.1 The allocation of resources to GP commissioning consortia will entail the balancing of incentives formore eYcient care against the need to ensure that suYcient funds are available to tackle local health needs.This will be particularly challenging where commissioning consortia do not align with historical geographicboundaries. At present there is a set of methods for resource allocation for hospital care from theDepartment of Health to PCTs, and another for allocations by PCTs to practices, based in part on a person-based formula. The person-based approach (developed by a consortium led by the NuYeld Trust) is basedon predicting future use of hospital care by exploiting information on primary and secondary care at theperson level. This approach has shown that it is possible to estimate a risk-adjusted capitated budget thatis driven by the individuals within a registered population base. As such it oVers a way of setting budgetsfor commissioning consortia in a way that does not depend on aggregating geographic areas.

5.2 A person-based approach to resource allocation could also be used to calculate budgets formultispecialty groups of primary and secondary care doctors, enabling aligned incentives for these cliniciansto work together to maximise health gain and service eYciency across sectors. Such multispecialty groupscould compete with one another for patients and hence oVer choice for users, as explored in a NuYeld/King’s Fund monograph.38

5.3 Policy decisions will need to be made as to which methods should be used for allocation of fundingto GP commissioning consortia, and the extent to which the NHSCB thinks it appropriate to direct themethod of allocation within each consortium. In part this will depend on how GP commissioning consortiafunction, in particular the extent to which they hold the budget rather than practices, or use other means toensure greater equity in access to care for the population on the basis of health needs, for example throughidentifying and reducing unwarranted variations in clinical practice. Three critical elements for the futureapplication of these approaches are:

— The need to combine allocation mechanisms across the care spectrum—at present the modelfocuses on the high cost acute sector. Ideally it should include mental health, maternity andcommunity based provision and arguably also social care.

— There is a need for mechanisms to share some risk across small populations so that consortiabudgets are less likely to be destabilised by the chance appearance of a small number of a very highcost patients.

— Implementation of these models requires a flow of information, at the person level, about careprovided and individuals’ health needs. Future commissioning organisations will need to ensurethat good quality information is both collected and that the systems and structures exist tocombine and analyses that information within and across commissioning groups

6. Conclusion

6.1 The NuYeld Trust supports the concept of clinically-led commissioning, and the associated principleof maximising clinicians’ involvement in health service planning, funding and service development decisions.We believe that GPs and specialists should be jointly involved, with the associated ability to take “make orbuy decisions” unrelated to personal income.

6.2 We consider the recent White Paper proposals to respond in part to the diagnosis we set out in ourmonograph ‘Where next for commissioning in the English NHS?’ In particular we welcome the allocationof real and risk-adjusted capitated budgets to consortia of GPs, along with responsibility for service qualityand health outcomes. Our concerns focus on six points:

— The likelihood that GP Consortia will be unable to control expenditure any more successfully thanPCTs before them, at least in the short term.

— The focus on GP rather than wider clinical commissioning.

— The strict separation between the commissioning and provider activity of consortia.

— The removal of the PCT as local system manager.

— The statutory nature of GP consortia.

— The extent to which GPs feel enthusiastic and incentivised to get involved in commissioning in anactive manner.

38 See Lewis R, Rosen R, Goodwin N and Dixon J (2010) Where next for integrated care organisations in the NHS? London,the NuYeld Trust and King’s Fund: http://www.nuYeldtrust.org.uk/publications/detail.aspx?id%145&PRid%693



References

Bardsley M, Billings J, Chassin L et al (forthcoming) Predictive models for health and social care: afeasibility study. London, the NuYeld Trust.

Blunt I, Bardsley M and Dixon J (2010) Trends in emergency admissions in England 2004–09: is greatereYciency breeding ineYciency? London, the NuYeld Trust.

Casalino L (2010) Motivating GPs to hold risk-bearing budgets: lessons from the US. NuYeld Trust andKing’s Fund seminar on GP commissioning, 9 June, 2010.

Coster G (forthcoming) Reflecting on the New Zealand National Health Board. London, NuYeld Trust.

Dixon J (2010) Making progress on eYciency in the NHS in England: options for system reform. London,the NuYeld Trust.

Dowling B and Glendinning C (2003) The New Primary Care: Modern, Dependable, Successful?Maidenhead, Open University Press.

Edwards B (2007) An independent NHS: a review of the options. London, the NuYeld Trust.

Glasby J, Dickinson H and Smith JA (2010) Creating NHS Local: the relationship between English localgovernment and the National Health Service. Social Policy and Administration vol 44, no 3, pp 244–264.

Ham C and Smith JA (2010) Removing the policy barriers to integrated care in England. London, theNuYeld Trust.

Lewis R, Rosen R, Goodwin N and Dixon J (2010) Where next for integrated care organisations in the NHS?London, the NuYeld Trust and King’s Fund.

NuYeld Trust and NHS Alliance (2009) Beyond Practice-Based Commissioning: the local clinicalpartnership. London, the NuYeld Trust and NHS Alliance.

Smith JA, Curry N, Mays N and Dixon J (2010) Where next for commissioning in the English NHS?London, the NuYeld Trust and the King’s Fund.

Smith JA and Goodwin N (2006) Towards managed primary care: the role and experience of primary careorganisations, Ashgate Publishing, Aldershot.

Smith JA, Mays N, Dixon J, Goodwin N, Lewis R, McClelland S, McLeod H, Wyke S (2004) A review ofthe eVectiveness of primary care-led commissioning and its place in the UK NHS. London, The HealthFoundation.

Smith JA and Thorlby R (2010) Giving GPs budgets for commissioning: what needs to be done? London,The NuYeld Trust, King’s Fund, RCGP, NAPC, NHS Alliance and NHS Confederation.

Thorlby R, Lewis R and Dixon J (2008) Should primary care trusts be made more locally accountable? Adiscussion paper. London, The King’s Fund.

October 2010

Written evidence from the Local Government Group (COM 72)

About the Local Government Group

1. The Local Government Group (LG Group) works on behalf of councils to support, promote andimprove local government. The LG Group is made up of six organisations:

— Local Government Association (LGA);

— Local Government Improvement and Development (LGID);

— Local Government Employers (LGE);

— Local Government Regulation (LGR);

— Local Partnerships; and

— Leadership Centre for Local Government.

2. Within the LG Group, the LGA is a voluntary membership body and our 422 member authoritiescover every part of England and Wales. Together they represent over 50 million people and spend around£113 billion a year on local services. They include county councils, metropolitan district councils, Englishunitary authorities, London boroughs and shire district councils, along with fire authorities, policeauthorities, national park authorities and passenger transport authorities.

3. The LG Group is pleased to submit this written response to the Health Select Committee’s inquiry oncommissioning and would welcome the opportunity to give oral evidence.



Introduction to the LG Group Response

4. We welcome the Committee’s inquiry into Commissioning given the significant number of questionsthat the health White Paper Equity and Excellence: liberating the NHS raises. Taken together, we believethat the proposals in the White Paper represent a major restructuring of not just health services but also localgovernment’s role in health improvement and the coordination of health and social care. It is therefore anarea of reform that we are deeply interested in.

5. The LG Group is working closely with our member authorities, and partners throughout the healthand social care world, to dissect some of the more complicated issues surrounding the White Paper’s variousproposals. As such our response will continue to evolve as we seek clarification to a number of questionsthat our work to date has raised. Some of these are shared in this submission—not to ignore the questionsposed by the Committee but rather to illustrate how our thinking is developing.

6. Underpinning our work on the White Paper are five questions, which we believe the government shouldapply to all the proposals to test for consistency. They are:

— Do the proposals build on existing experience and good practice?

— Do they support an area-based approach?

— Do they promote a person-centred approach?

— Do they ensure accountability to local communities?

— Do they ensure that public resources are directed to the areas of greatest need?

7. Owing to the fact that this area of work is very much a “work in progress” our submission does notadhere strictly to the Committee’s lines of inquiry and instead provides the latest LG Group thinking. Givenour remit and interest this submission naturally focuses on issues of accountability, integration, public healthand transition.

Key Points

8. Local government has real expertise in commissioning and invaluable experience of operating in, anddeveloping, mixed economy markets. As such we are eager to see local authorities: take a lead role incommissioning particular services where councils have the practical service knowledge and experience to doso; work closely with GP consortia in the commissioning of other services; and support consortia on theinfrastructure and systems associated with the commissioning process.

9. We have some concerns that GP practices do not have such commissioning experience and are moreused to operating as a small business, unlike local authorities which oversee multi-million pound budgetsand are expert across the full commissioning spectrum; from data analysis and procurement planning tocontract and financial management.

10. Councils are ideally placed to take a central role in the commissioning process because the goal ofimproving public health and wider wellbeing is about more than just health and social care services. Itincludes the services and activities provided by housing, leisure, and transport departments to name a few.

11. Councils have a central role in all these areas and can therefore provide the much needed broaderinfrastructure within which GP consortia will carry out their proposed functions. This is crucial becauseworking across services, and indeed organisations, is part of the process that develops more innovative andpersonalised services.

12. Central to the commissioning process must be the Joint Strategic Needs Assessment (JSNA) toeVectively plan for a population’s needs. There are good examples of councils and PCTs working positivelyon JSNA and coterminous organisational boundaries are often cited as helpful in strengthening partnershiparrangements between local government and health.

13. Looking to the future it will therefore be important that the scope of the JSNA covers the localauthority area, and is not defined by where GP consortia choose to form themselves. This could lead to across-boundary scope, which would complicate care pathways.

Accountability

NHS Commissioning Board

14. An independent NHS Commissioning Board will be responsible for allocating NHS resources to GP-based consortia and supporting them in their commissioning decisions. We believe this represents acentralisation of decision-making in the health service. Consequently, we think it is essential that the Boardrepresents local decision-making at the national level, whilst allowing local commissioners the flexibility toadapt services to local public services.

15. This “subsidiarity principle” underpins our views on the Commissioning Board and we prefer to seecommissioning led by GP consortia in close partnership with local government. We are therefore keen tounderstand more about the government’s plans for the nature of local government involvement andengagement in the Commissioning Board’s structures and work.



16. We have further questions on the role of the Board at regional and sub-regional level—particularly inregard to arrangements for commissioning and primary care, dentistry and pharmacy contracts for example.Again, we are eager to know how such arrangements will relate to councils.

17. We believe there is a risk that the creation of the NHS Commissioning Board and Public HealthService at a national level, and the roles of GP consortia and local authorities at a local level, may lead to adivision between healthcare and public health. This has the potential to detract from a coordinated approachlinking interventions across the spectrum from prevention to health treatment.

18. We are keen to know what the commissioning scope of the Board will be and how this will relate withGP consortia and Health and Wellbeing Boards.

Health and Wellbeing Boards

19. We fully support the creation of Health and Wellbeing Boards to provide local leadership and astrategic framework for coordination of health improvement in local areas. This must be based on the localhealth needs of an area as identified by the Joint Strategic Needs Assessment.

20. We envisage HWBs being the senior strategic partnerships body comprising oYcers, elected Members,GP commissioners and community/patient representatives. They will drive forward needs assessment,agreement of local priorities and the development of commissioning plans to improve the health andwellbeing of local people. In dialogue with the public, stakeholders and service users they must identify gapsin service provision and help GP commissioning consortia take decisions about investment anddisinvestment.

21. We support the proposal for HWBs to be a statutory requirement for all upper-tier local authorities,although they will need the flexibility to join together to work in sub- and supra-regional groupings toaddress health and wellbeing issues aVecting larger areas. They will also need the freedom to devolve powersand responsibilities to smaller areas—district councils, parishes and neighbourhoods—to engage moredirectly with local communities.

22. GP commissioning consortia will need to consider how they can best align with HWBs and we believethey should be required to develop their commissioning plans in partnership with the Boards based on thelocal health needs identified in the JSNA. We further believe that HWBs should have authority for signingoV GP commissioning plans and should be required to publish an annual joint commissioning plan inpartnership with GP commissioning consortia.

Health Watch

23. We support the government’s commitment to giving patients and the public a voice and profile in thedevelopment and review of health and social care services. However, in order to give HealthWatch the bestpossible chance of succeeding we need to ensure that it is built on strong foundations. We therefore stronglyrecommend that the government undertakes an evaluation of Local Involvement Networks (LINks) so thelessons from that structure of patient and public involvement can be captured and shared.

24. Moreover, we seek urgent clarification on funding provision for interim patient and publicinvolvement arrangements. LINks’ funding ends in March 2011 yet the White Paper proposes that HealthWatch will be operational from April 2012. This potentially means a whole year of no funding for a crucialelement of the health and social care review and development architecture.

25. A local Health Watch will not be the only local body that is concerned with engaging the public indeveloping and reviewing health and social care services; at a local level a number of bodies may exist thatcan eVectively capture the views of users and the general public. We therefore believe there should be moreclarity on the proposed role and boundaries between a local HealthWatch and other local bodies.

Health overview and scrutiny

26. We have sought the views of all councils on our developing positions on the Health White Paper andon the issue of overview and scrutiny the sector is unanimous; councils value their health scrutiny functionsand see them as an eVective means of holding the executive to account for decisions aVecting the health andwellbeing of local communities.

27. The Health and Wellbeing Board as proposed in the White Paper is clearly an executive body withwide-ranging commissioning responsibilities and cannot, therefore, hold itself to account. The roles, powers,membership and accountabilities of HWBs and health OSCs will therefore need to be clearly defined anddistinct from each other. Fundamentally, arrangements for the scrutiny of local health outcomes, and Healthand Wellbeing Board performance, needs to be separate from the Boards.

Directors of Public Health

28. The White Paper proposes that Directors of Public Health (DPH) will have dual accountability tolocal authorities and to the Secretary of State through the Public Health Service. We question the need forjoint accountability and believe that DPH should be accountable to just their councils in the same manneras other chief oYcers.



Integration

29. The LG Group strongly supports the further integration of health and social care services,particularly given the unique funding environment that public services will be operating in over the comingyears. Joint commissioning represents a big opportunity to further embed integration and build on existinggood practice between councils and PCTs. There are many examples across the country of local governmentworking constructively with health to develop local services that best address local need.

30. Our preferred approach is that all commissioning should be undertaken at the local level unless thereare compelling reasons (such as financial or clinical) for it to be done at a regional or national level. Evenin the event of commissioning taking place at the national or regional level we would expect ongoingcoordination with local commissioners.

31. We will support councils to engage with emerging GP commissioning consortia to develop jointcommissioning plans and we are committed to supporting GPs. This may mean, for example, councils takinga lead role in commissioning services where GPs have limited experience in services that councils understandwell, such as:

— Mental health;

— Homelessness;

— Long-term conditions;

— Drug and alcohol dependency;

— Dementia;

— Learning disabilities;

— HIV/AIDS; and

— Free nursing care (currently paid for by PCTs).

32. Local authorities will also be able to oVer GP commissioning consortia support with the provisionof “back oYce” functions such as HR, payroll, IT support and performance monitoring. We stronglyrecommend that GPs give consideration to working with councils to join up commissioning infrastructureand support.

Public Health

33. Local government has a central role to play in promoting public health and health improvement andwe strongly support the proposals to transfer responsibility for improving the public’s health to localauthorities.

34. Taking on this additional responsibility must be accompanied with additional resource. We arepleased the government recognises this point but do not believe that the imposition of a ring-fence is right;this runs counter to the place-based approach advocated by the LG Group and we believe the ring-fenceshould be removed to enable councils to use resources to greatest eVect. Experience from the Total Placepilots shows that ring-fenced funding can be a barrier to adopting a whole-systems approach.

35. Indeed, far from protecting resources for public health, a ring-fence may have the opposite eVect andbe seen as the totality of resource to funding public health and health improvement. Other services, such ashousing, transport and leisure all make a significant contribution to public health and we do not want tolose this coordinated, joined-up approach which the ring-fence may threaten.

36. It is not clear how public health interventions will be evaluated. We do not want to see a return to acentralised or rigid approach to evaluation, which could run the risk of replicating previous NationalIndicators and an unhelpful focus solely on what can be measured.

37. A number of issues require further clarification, including:

— What the division of responsibility will be between the national Public Health Service and localgovernment and how the respective priorities of each will be balanced to ensure local priorities arenot undermined by national ones.

— What percentage of NHS resources will be transferred to local authorities for public health?

— How will GPs and health providers engage with the public locally and how will the NHSCommissioning Board engage with the public nationally?

Transition

38. The proposals in the White Paper represent a major restructuring of both health services and localgovernment’s role in health improvement and the coordination of health and social care. Achieving theobjectives of the White Paper will therefore mean a fundamental shift from focusing on structures andsystems to how people and patients experience services and commission them for the best outcomes. It willalso require a significant change in emphasis from working to achieve centrally imposed process targets tothe setting of local health outcomes based on local health needs.



39. Such a dramatic change in emphasis must be supported by the right behaviours, which will notstraightforward given the numerous stakeholders involved in the White Paper’s reforms will have diVerentcultural perspectives. GPs may have limited experience of working with elected Members, and vice versa,for example. At both the national and local level, discussions on reform of health commissioning and thecoordination of health improvement must be underpinned by the question: what is the most eVective wayof securing the best health outcomes for all local people?

40. As strategic leaders of health improvement local councils are committed to working with partnersin primary care to ensure a smooth transition. It order to do this it will be necessary to transfer some keycommissioning support from PCTs to councils for a transitional period to develop the capacity of GPcommissioning consortia.

41. We support the principle of the lead for commissioning being as close to patients as is possible and,in general, we agree that this role sits naturally at the primary care level. We do, however, have some concernsthat for a significant number of people—including those with mental health problems, learning diYcultiesand drug and alcohol problems—their care and support needs are primarily met by social care and othercouncil services, rather than primary care services. In such cases we believe that the local authority shouldtake a lead in commissioning.

October 2010

Written evidence from the British Medical Association (COM 109)

The British Medical Association (BMA) is an independent trade union and voluntary professionalassociation which represents doctors and medical students from all branches of medicine throughout theUK. With a membership of over 140,000, we promote the medical and allied sciences, seek to maintain thehonour and interests of the medical profession and promote the achievement of high quality healthcare.

1. Executive Summary

1.1 EVective commissioning can improve the range and quality of health services available to patients.In order to facilitate this, there has to be meaningful clinical engagement from and with both primary andsecondary care.39

1.2 We are interested in exploring the Government’s proposals for GP-led consortia, which see GPs asan integral part of the commissioning machinery within the NHS in England, as set out in “Equity andexcellence: Liberating the NHS”. Successful commissioning will only be achieved with GPs, secondary andtertiary care consultants and other clinical colleagues working together. Public Health consultants will alsohave a significant role to play, as will clinical academics, in creating high-quality care pathways.

1.3 The concept of GPs taking a leading role in many of the NHS’s commissioning decisions is not widelyunderstood. Some patients may view GP-led commissioning with suspicion, particularly when their GPrefers them for treatment from another GP provider. It will be essential to develop and implement a systemthat maintains patient trust and protects professional values. This system should be as transparent aspossible and assure patients that their doctor is referring them to a particular provider purely because it willprovide the best clinical outcome.

1.4 We are concerned that the Government’s plans have the potential to accelerate a market-ledapproach, creating increased transaction costs, fragmentation and competition rather than collaboration.The current system of Payment by Results (PbR) is not fit for purpose, encourages perverse behaviours andis highly bureaucratic.

1.5 The winding down of Primary Care Trusts (PCTs) and Strategic Health Authorities (SHAs) must bemanaged carefully to avoid confusion and ineYciency. Both should remain in place until the new structuresare ready to operate. Steps must be taken to prevent the loss of significant numbers of skilled staV withinboth types of organisation, something which may already be occurring. It has been reported that moraleamongst PCT staV is very low, and there has been evidence that senior staV are already leaving, includingtwo chief executives in Derbyshire and North East Lincolnshire.40

1.6 The interface between the Public Health Service and commissioning will be crucial. It is imperativethat there is continued public health input into commissioning and, reciprocally, continued GP input intopublic health strategies.

39 The paper “BMA principles for eVective and successful commissioning” can be found online:www.bma.org.uk/employmentandcontracts/independent contractors/commissioning service provision/bmaeVectcomm.jsp

40 “BMA warns of primary care trust implosion” The Financial Times, Friday 1 October 2010. Available at http://www.ft.com/cms/s/0/b0c61408-ccb4-11df-a1eb-00144feab49a,dwp uuid%debe9554-8da0-11df-b5e2-00144feab49a.html



1.7 When commissioning national and regional specialised services, the NHS Commissioning Boardshould actively seek the assistance of appropriate secondary and tertiary care specialists and GPs fromconsortia. The Board will not be able to make informed decisions without involving them.

1.8 The BMA has asked for more details from the Government on the proposals contained within theWhite Paper, since it is diYcult to comment extensively on some of the proposals until that is made available.


2.1 We believe that collaboration rather than competition should be the focus of the reforms. EVectivemulti-professional involvement in commissioning is vital to achieve seamless and cost-eVective patient care.Greater competition in the NHS is likely to lead to increased fragmentation of services, and competitionwithin and between professional groups could lead to a reduction in the involvement of allied healthprofessionals in consortia.41

2.2 The BMA strongly supports greater clinical involvement in the design and management of the clinicalservices. Consortia will have to develop local systems and work closely with colleagues from secondary careand public health, as well as others such as medical academics and social care professionals, to enableevidence-based, integrated decision-making and ensure sensible care pathways are in place. This will helpto promote multi-professional inclusivity and support and build confidence among healthcare professionalsand patients in the decisions of GP-led consortia. Consortia will need to design mechanisms to resolve anyconflicts that might develop along professional lines in the course of multi-professional working.

2.3 In order to support commissioning consortia, data must be accurate, timely, quality-checked andvalidated. The data sets should include information on expenditure, referrals, prescribing and clinicalperformance across secondary and community care. It is the BMA’s view that the provision of suchinformation to practice-based commissioners by PCTs in the past has been poor. Consortia will only be ableto commission eVectively when the relevant information is to hand.

How will commissioners address issues of clinical practice variation?

2.4 When commissioning services, consortia will take due account of referral patterns and patientpreferences expressed by individual practices, and where possible informed by practice level data. They willnot have a role in handling variations in clinical practice under primary care contracts—this will be a matterfor G/PMS contracts that are the responsibility of the NHS Commissioning Board. The BMA does havesome concerns about the lack of detail about the governance arrangements for the provider function of GPpractices. Consortia will, however, design clinical pathways and protocols for the services they commissionand practices will presumably sign up to these. If quality is a concern, then this would be a matter for theCare Quality Commission (CQC).

3. How Open will the System be to New Entrants?

3.1 We believe that current NHS providers should remain the principal providers for primary andsecondary care, to ensure continuity of care, the development of productive long-term relationships andfinancial sustainability. The “any willing provider” policy, detailed in the White Paper, has the capacity toundermine local health economies by replacing existing multi-service natural monopolies with a plethora ofsmaller units providing more limited ranges of services. This would radically aVect both the eYciency andvalue for money of the NHS. Where services are not of the required standard or where the current providersare not able to provide a service, then commissioners will wish to look to alternative providers to do.However, we believe that frequent, unnecessary changes of provider would be detrimental for the reasonsexpressed above.

3.2 Consortia will require support from those who already have direct experience of commissioning.Consortia need to develop a local infrastructure of personnel who are accountable within the commissioningprocess. Many of these can be drawn from current PCT, SHA and public health staV who have localknowledge, experience, and appropriate expertise and skills.

4. Accountability for Commissioning Decisions

How will patients make their voice heard or their choice eVective?

4.1 We have concerns that the Government’s White Paper places undue and misplaced emphasis on thecontinuation and extension of the patient choice agenda. This has not improved clinical outcomes, or givenpatients the choices they actually want. We support meaningful choices for patients, and the evidencesuggests that most of all, patients would want high-quality providers close to where they live and to receivetimely, competent diagnosis and treatment, and ongoing support when necessary.

4.2 The National Association for Patient Participation (NAPP) is currently mapping PatientParticipation Groups. This work could feed into the NHS Commissioning Board. Where piloting andevaluation shows them to be beneficial to patient care, appropriate Patient Reported Outcome Measures

41 House of Commons, Health Committee, Commissioning, Fourth Report of Session 2009-10, Vol. 1, 2010.



(PROMs) could be built into contracts and published on the NHS Choices website. Where services arecommissioned from primary-care providers these services should be required to undertake PROMs reviewin the same way as the services of other providers.

4.3 Patients should be able to observe consortia meetings and have an opportunity to submit views andask questions, while Patient Participation Groups should be encouraged at a practice level. Consortia mightappoint a patient or public representative, to ensure the patient voice is at the core of the developingconsortia mode, and patient representatives might also be involved in the creation and development ofpatient pathways. Consortia will also be expected to have close links with their local authorities and thisshould help to ensure both scrutiny and that the public voice is heard.

4.4 It will be necessary for a formal process to be developed to enable consortia to consider the views ofall relevant stakeholders and the public in relation to significant commissioning decisions. Partnership withlocal authorities will be vital to enabling this process in some areas, such as mental health, children’s servicesand geriatrics. The Government must consider the time and resource constraints placed on consortia, andthe limitations this may place on any process developed.

What will be the role of the NHS Commissioning Board?

4.5 At the moment the role of the NHS Commissioning Board is unclear. We are concerned that the gapbetween a national NHS Commissioning Board and locally based consortia will be too great, and there isa risk that the Board could be too remote from individual consortia for the two to be able to liaise eVectively.This will become even more of a concern if many small consortia are formed. It may be appropriate for theBoard to have local outposts of some kind, to liaise with consortia, provided this does not compromiseeYciency savings gained through the abolition of SHAs and does not replicate the bureaucratic performancemanagement functions of SHAs.

4.6 The NHS Commissioning Board, while holding consortia to account, should also have a supportiverole in helping local consortia commission eVectively and in developing ways of enabling widercollaboration between consortia, particularly when commissioning low volume or regional specialisedservices. Training events for commissioners should be held on a regional and national basis, as appropriate.

4.7 The Board should review local commissioning practices to ensure that consortia-commissionedservices are provided at an appropriate and equitable level across the NHS.

What legal framework will be required to underpin commissioning consortia?

4.8 Consortia will be public bodies and therefore will be recognised and governed by statute. The detailbehind this has yet to be published.

4.9 It is likely that GP-led consortia will have a multitude of legal and financial responsibilities, includingmanagement of finances and budgets, bidding and tendering issues and compliance with any legislation thatis in place to cater for the new processes. Practices and consortia will need to understand the implicationsof managing and employing staV who work for a future consortium, as well as any relevant employmentissues such as Transfer of Undertakings (Protection of Employment) Regulations (TUPE), redundancies,unfair dismissal etc. This may be relevant if, for example, current PCT functions or part of a PCT’s functionsare transferred to GP consortia, leading to a transfer of relevant staV.

4.10 As consortia will be expected to commission services and will have the freedom to use resources toachieve cost-eVective outcomes, they will need to have knowledge of how to tender for services legally.Consortia, as public bodies, will be subject to the rules of public procurement.

How will commissioning interface with the Public Health Service?

4.11 The interface between the Public Health Service and commissioning will be crucial. It is imperativethat public health is embedded in the commissioning process. We believe public health specialists areuniquely placed to work in partnership with and assist GPs to make the best value commissioning decisions,given their bird’s eye view of healthcare needs and ability to analyse health services information from apopulation perspective. In addition, public health doctors are experienced at working closely with secondaryand tertiary care clinicians, to ensure best-quality clinical outcomes, which will be of great value in thecommissioning process.

How will commissioning interface with HealthWatch?

4.12 Due to the lack of detail within the White Paper proposals, we have been unable to give detailedconsideration to how commissioning will interface with HealthWatch. We have highlighted to theGovernment that many GP practices have already taken the initiative in this area and encouraged thedevelopment of Patient Participation Groups. This has been of considerable benefit to both patients andpractices, and we would hope that the roles of independent Patient Participation Groups and localHealthWatch groups would be complementary.



5. Integration of Health and Social Care

How will any new structures promote the integration of health and social care?

5.1 The BMA has urged the Government to provide a clear definition of social care, as it is vital that thepublic, commissioning groups and local authorities are aware which services will be provided by the NHS,free at the point of delivery, and which services will not. This would enable better joint commissioning, helpGP-led consortia to be able to invest appropriately in preventative services, and clarify, to an extent, the sortsof services people might need to save to pay for.

5.2 We support greater collaboration between health and social care services42 and the breaking down ofburdensome barriers between health and social care that do not benefit patients. In order to create seamlessintegration between health and social care, new pathways will be required to link services to facilitatemovement of patients between diVerent care sectors. However, the very real funding issues associated withsuch moves will need to be addressed, particularly in an environment of serious financial challenge whichwill be felt even more severely in social care than in health care. We have concerns that health funding willbe used to fill the gap in social care funding long before the benefits of a new approach could be realised.

5.3 We would like to see a more strategic approach to the challenges facing health and social care servicesin terms of life expectancy and current health trends. Social and environmental factors which lie outside thehealthcare system are the major cause of health inequalities and these will increase unless the root causes areaddressed. We welcome the commitment to review the long-term care of the elderly.

6. What will be the Role of Local authorities in Public Health and Commissioning Decisions?

6.1 The BMA notes this year’s 20% reduction in local authority funding with grave concern.43 It is likelythat care services provided by local authorities will be aVected by budget cuts in the coming months andyears, which will make it more diYcult to commission integrated care pathways and services and meet thewider support needs of patients.

6.2 Local authorities will play a key role in the provision of public health and in other commissioningdecisions. The Directors of Public Health, situated in local authorities, should be an accredited specialist inpublic health. As such, they should be recognised by the local authority as the principal oYcer accountablefor all matters related to population health and the principal advocate in local health systems for healthimprovement and reducing health inequalities. The BMA would like the oYce of Director of Public Healthto be a statutory appointment as an independent advocate for the health of a defined population.44

Furthermore, the Director of Public Health should be an executive appointment reporting directly to thechief executive of the local authority.

7. Transitional Arrangements

7.1 The winding down of PCTs and SHAs must be managed extremely carefully if confusion andineYciency is to be avoided in the current system’s final years and months. The task of PCTs and SHAs willbe made additionally diYcult because they will be required to take on additional short-term work to supportthe transition. There is a risk that, if too many of the best managers leave their current employment too soon,there will not only be a reduction in workforce numbers, but also a loss of corporate memory which willleave those staV left at PCTs and SHAs struggling to cope eVectively with an increased workload. We areextremely alarmed at the potential vacuum that could occur. If handled poorly, there is a real risk of PCTimplosion. The BMA has grave concerns over the possibility that PCTs may be phased out before consortiaare properly established and would suggest that PCTs should be retained until consortia are fullyoperational. Ironically, where PCT management is good and there have been good relationships betweenPCT and local practices, transitional arrangements are likely to be much more straight-forward than in areaswhere both management and relationships are poor. These areas will require much greater transitionalsupport.


How will resources be allocated between commissioners?

8.1 Consortia must have budgets that are appropriate for their commissioning populations. Any movestowards a “fair share” budget that is proportional to the commissioning group’s needs must be handledsensitively. Historic NHS funding is entrenched in local health economies and any sudden move away fromthis would destabilise health systems that are vulnerable to small shifts in funding. The previousGovernment had implicitly recognised this diYculty by slowing the move from historic indicative practice-based commissioning (PBC) budgets to “fair share” indicative PBC budgets, which were supposed to reflectmore fairly the health needs of a locality.45

42 Annual Representative Meeting (ARM) 126. BMA, 2000.43 “Local government to bear brunt of £6.2bn cuts”, The Guardian. Monday 24 May, 2010. Available at

http://www.guardian.co.uk/society/2010/may/24/cuts-local-government-loses-2bn44 BMA (2010) ARM Emergency Motion 245 Practice-based commissioning: budget guidance for 2010/1. Department of Health, 2010. Available at

http://www.dh.gov.uk/en/Publicationsandstatistics/Publications/PublicationsPolicyAndGuidance/DH 111057



8.2 Developing a commissioning budget that realistically reflects the existing and likely health needs ofa local population and enables consortia to commission all of their patients’ care will be very diYcult, andcommissioning budgets should move towards this goal slowly. Any budget formula must be suYcientlysensitive, or consortia could be held responsible for overspends which have more to do with faulty budgetsetting rather than ineVective or flawed, commissioning. Budgets should be agreed by consortia and adispute process put in place in the event that the budget cannot be agreed.

8.3 There should be no expectation that an eVective commissioning process will generate surplusresources on a regular basis. Although services must be commissioned with reference to available NHSresources, patient demand can vary year on year and an expectation of budget surplus is unrealistic.

8.4 All debts outwith the control of consortia, particularly structural debt tied in with private financerinitiatives (PFI), should be dealt with separately by a central fund that top-sliced the budget allocated to theCommissioning Board.

What arrangements are proposed for risk sharing between commissioners?

8.5 Risk management must enable consortia to pool commissioning risk. The smaller consortia willnaturally face the greatest risks. The current proposals seem to diVer little from existing arrangements inPCTs. There appears to be no incentive not to spend any remaining funds at the end of the financial year,on items or short-term projects that are of little long-term benefit, as there remains a risk that unspent moneywill not be carried over into the next year.

9. Specialist Services

What arrangements are proposed for commissioning of specialist services?

9.1 When commissioning national and regional specialised services, the NHS Commissioning Boardshould actively seek the assistance of appropriate tertiary and secondary care specialists and GPs fromconsortia. The Board will not be able to make informed decisions without involving local consortia. Amechanism is required to enable consortia to send representatives and specialists to the Board to facilitatelocally relevant decision making. The Board should also encourage coordination between consortia acrossareas within a region to ensure that the commissioning of specialised services fits with the commissioningplans of other consortia. It would also make financial sense to have such cross-consortia coordination.

9.2 For the commissioning of other, more locally based, specialist services (those which not all practiceswill be able to oVer and where a formal procurement process will be necessary), it may be appropriate toestablish a split in the commissioning functions of the consortium between the designing of a care pathwayand the contracting and procurement of services. The design of the care pathway would naturally beclinician-led, while the procurement function could be carried out by appropriately skilled and experiencedmanagers employed or engaged by consortia. They would procure the service from the most appropriateprovider with no bias towards (or against) any members of the consortium who were also potentialproviders. This split would ensure that clinicians involved in commissioning decisions had no influence overthe actual procurement of services, and as such would help to avoid conflicts of interest.

9.3 The BMA is not convinced by the Government’s proposals that maternity services should becommissioned by the NHS Commissioning Board and believes it would be more appropriate for them to becommissioned at consortium level, though there may be the need for wider oversight. Recent research byThe King’s Fund highlighted that GPs’ lack of involvement in maternity care is undermining the care ofpregnant women and their families and suggested that shared care, between GPs and midwives andobstetricians, could result in better co-ordination of care, particularly for women with ongoing medicalconditions and complicated medical histories.

October 2010

Written evidence from The King’s Fund (COM 118)

1. The King’s Fund is a charity that seeks to understand how the health system in England can beimproved. Using that insight, we help to shape policy, transform services and bring about behaviour change.Our work includes research, analysis, leadership development and service improvement. We also oVer a widerange of resources to help everyone working in health to share knowledge, learning and ideas.

Summary

2. The previous Health Committee strongly criticised the current commissioning regime, concluding that,unless it is able to demonstrate better value for money, the purchaser/provider split may need to be abolished.It highlighted a number of weaknesses including:

— PCTs remain largely passive commissioners and do not challenge providers suYciently regardingthe quality and eYciency of their services.

— PCTs lack essential data analytic skills, clinical knowledge and high quality managerial talent.



— The skills deficit in PCTs has been worsened by “constant reorganisations and high turnover ofstaV”.

3. Since the publication of the Committee’s report, the latest world class commissioning assessments havebeen made available and we have published new research focusing on the use of external support forcommissioning by PCTs. Both highlight marked improvements in the quality of commissioning over the lastyear, although many of the weaknesses identified by the Committee remain.

4. The new Government’s White Paper Equity and Excellence: Liberating the NHS proposes to replacethe current arrangements with a new system of GP commissioning, abolishing PCTs by 2013. Our evidenceto this inquiry draws on our response to the White Paper to make the following key points:

— Giving budgets to GPs provides a significant opportunity to improve commissioning in the NHS.However, the government’s approach risks undermining the benefits it could bring. We recommenda more measured approach that enables those who are ready to pilot the new arrangements to doso, with the learning used to support a flexible, staged national roll out that enables consortia totake on increasing responsibilities as and when they are ready to do so.

— Although we do not endorse abolishing the purchaser/provider split, there is a strong argument forsticking less rigidly to a separation of the two functions. The needs of some patients, for exampleolder people and people with long-term conditions, may be better met by organisations which bringtogether commissioning and some or all aspects of provision. Now is the time for policy-makersto explore the role that such integrated systems could play in the NHS.

— While we acknowledge the case for some reform, we question the need to embark on a fundamentalreorganisation of the NHS at this time. Streamlining NHS structures over time as the newcommissioning arrangements are implemented, rather than abolishing all PCTs and SHAs by a setdate, would ease the transition and minimise instability as the NHS also confronts the mostsignificant financial challenge in its history.

— It will be vital that the consortia include a range of clinicians and professionals as well as GPs.

— While we welcome the enhanced role that local authorities will play under the government’sproposals, the relationships between the National Commissioning Board, local Health and Well-being Boards and GP commissioning consortia need to be clarified. The loss of co-terminositybetween local authorities and commissioners risks undermining collaborative working.

— An overly restrictive management allowance could make it diYcult for consortia to build or buyin the range of skills they will need to commission eVectively.

— More thought needs to be given to how consortia will collaborate to commission specialist servicesthat cannot be eVectively commissioned by individual consortia. Allowing this to happenorganically may not be suYcient.


5. Limited use of clinical expertise remains a key weakness in commissioning. Practice-basedcommissioning (PBC) has not succeeded in securing suYcient clinical engagement, in part because theincentives to engage are weak, and in part because many GPs feel it does not give them enough power orcontrol over commissioning decisions (Curry et al 2008). Devolving power down to consortia level andreplacing the notional commissioning budgets used in PBC with real budgets can be expected to improvethis.

6. The evidence from clinical commissioning groups in other countries, particularly the USA, makes itclear that involving doctors from a range of specialties, not solely GPs, is crucially important for success(Ham 2010a). Engaging other professionals such as nurses, pharmacists and social care professionals is alsoimportant. With real multi-disciplinary involvement, commissioning consortia can become the focus forimproved collaboration and closer working between services and professionals. If, however, commissioningis seen principally as the prerogative of GPs, there is a risk of it widening historic divisions between diVerentparts of the health service, and in particular between primary and secondary care.

7. The government’s intention to make membership of commissioning consortia mandatory will go someway to encouraging a minimum level of clinical engagement in commissioning. However, it will also beimportant for GPs and other professionals to feel they have ownership of these new organisations. Thegovernment will need to develop a clear operational policy on how GP consortia will work with theirconstituent GP practices to ensure due process and transparent decision-making. Rules governing conflictsof interest should not, however, become a rigid barrier which prevents consortia from commissioningservices from their constituent practices. This would risk making it diYcult for GPs to use theircommissioning powers to develop new services in primary care, which for many GPs is likely to be one ofthe main attractions of engaging with commissioning.



Implementing the Proposed Reforms

8. The research evidence suggests that clinical commissioning is most successful when the scope ofservices commissioned is adjusted according to the size and skills of each commissioning group (Ham2010a). We do not, therefore, endorse the proposed single model for GP commissioning, in which allconsortia bear full risk for commissioning a near comprehensive range of services, as described in theGovernment’s White Paper (DH 2010).

9. However, if this approach is implemented, we urge the Government to adopt a more flexible, stagedprocess in which consortia are not exposed to full budgetary risk in the first years of their existence, and onlytake this on as and when they are ready for it. Experience from other countries suggests that a gradualtransfer of budgetary responsibility is required as GP commissioners learn how to manage budgetseVectively. This would allow (a) some consortia to take on responsibilities before others, and (b)responsibilities to be transferred incrementally rather than transferring full financial risk from the outset.The NHS Commissioning Board could have the power to limit windfall gains or unavoidable losses duringthis period, or until there is general confidence in the accuracy of the formula used to allocate resourcesbetween consortia.

10. The readiness to take on greater responsibilities for commissioning currently varies markedly betweendiVerent groups of GPs. Some practice-based commissioning groups are ready to make a start as soon aspossible. Supporting them to be early adopters by using 2011–12 as a shadow year for introducing GPcommissioning would enable testing and evaluation to take place to inform national implementation.

11. Building the necessary capabilities within consortia will be a key challenge in implementing theproposed reforms. Commissioning is a complex and multi-faceted task, and doing it eVectively requires abroad range of skills. These range from very specific, technical skills (eg data analysis and interpretation) tomore generic but no less important skills in leadership and management (eg influencing, negotiation andrelationship management). Highly specialist skills are also needed in areas such as accountancy and contractmanagement.

12. While it will not be necessary for consortia to develop all these skills internally, they will as a minimumneed to quickly develop a clear understanding of the diVerent elements of high quality commissioning, andthe support they may need in order to do it eVectively. They will also need strong leadership andcommunication skills, in order to establish an eVective dialogue with colleagues in primary and secondarycare about quality and productivity, and to influence professionals who are not directly accountable to them.

13. Other, more technical skills may be bought in or built over time by working with commissioners inPCTs and local authorities, or with private sector companies oVering commissioning support services. Ourresearch found that while external support can help improve commissioning processes, PCTs have notalways been eVective users of the services available (Naylor & Goodwin 2010). GP consortia will notnecessarily have experience of using external support and are likely to be operating with more restrictivemanagement allowances. They will therefore need to learn from PCTs’ experience of using external supportto avoid repeating past mistakes.

14. If management allowances are too restrictive, there is some risk that consortia will not be able to eitherbuy in the skills they need or build them in-house.

15. The results of the 2010 world class commissioning assessment process indicate that commissioningskills within some PCTs have improved considerably since 2009 (Gainsbury et al 2010). An immediatepriority must be to support existing commissioning and managerial talent in PCTs, SHAs and elsewhereduring the transition period, to prevent the accumulated knowledge and skills from being lost. If the rapidchanges currently being seen in PCTs continue and lead to a major scaling back in their activities beforeconsortia are fully operational, there is a serious risk of losing financial control in the interim period.

Accountability Arrangements for GP Commissioning

16. The White Paper proposes that GP consortia are held accountable by the NHS Commissioning Board(NCB), using a commissioning outcomes framework. The NCB will have a very wide-ranging remit,including calculating how resources will be allocated between consortia, holding them to account,developing commissioning guidelines and model contracts, and directly commissioning services notcommissioned by consortia. Despite the intention set out in the White Paper for it to be a “lean and expertbody”, the NCB is likely to need a substantial workforce and a presence at the regional level, to dischargethese varied responsibilities eVectively.

17. The proposed framework focuses principally on the outcomes consortia will be expected to achievefor the population they serve. We are concerned that focusing just on outcomes will leave the NCB poorlyequipped to assess the performance of consortia, since outcomes measures used in isolation can beinsensitive to diVerence, slow to detect change over time, and will be influenced by multiple external factorsbeyond the consortia’s control. While we would not advocate the creation of an assessment process asburdensome as world class commissioning for GP consortia, we believe the NCB should complementoutcome measurement by also assessing consortia in terms of a small number of essential commissioningprocesses or competencies, particularly during the first years while consortia are still developing their skills.



18. Particular accountability arrangements should be put in place with regard to the use of externalsupport. If some consortia choose to outsource their responsibilities and transfer the financial risks involvedin commissioning onto private sector organisations, arrangements will be required to safeguard publicaccountability and ensure the organisations involved are capable of taking on these risks.

Integration and the Role of Local Authorities

19. Local authorities will be given a number of new roles under the proposed reforms. In addition totaking on responsibility for commissioning public health services, new Health and Well-being Boards willbe established with responsibility for:

— co-ordinating and integrating the commissioning of health and social care services;

— assessing population health needs and leading, or at least overseeing, health improvementactivities; and

— scrutinising consortia’s plans for service redesign.

20. Transferring public health commissioning to local authorities creates a welcome opportunity tointegrate the planning of public health interventions with decision-making around broader factors thatinfluence population health, such as education, housing and transport. However, it is important that theNHS remains closely involved in health improvement and prevention, and that the many opportunities thatexist for health professionals to promote health and wellbeing are not lost. Further thinking is needed onhow responsibilities in this area will be divided between consortia, local authorities and the new PublicHealth Service.

21. GP commissioners will have a central role in developing integrated models of care which spanorganisational boundaries. The case for collaboration in the delivery of high-quality care for people withlong-term conditions and for older people who have complex co-morbidities is compelling. Many of thesepeople are frequent users of NHS and social care services who could be supported to live independently ifprimary care teams worked more eVectively with specialist teams based in hospitals. Integrated serviceprovision has the potential to deliver more care closer to home and avoid the inappropriate use of hospitalsas is already being demonstrated in areas like Torbay, with emerging evidence suggesting that working inthis way also delivers savings to the NHS (Ham 2010b; Ham & Smith 2010). Given the severe pressure onhealth and social care budgets over the next few years, it will be essential that NHS organisations and localauthorities do more to work together to pool resources and align services in this way.

22. The impact of the reforms on the integration of health and social care may depend largely on theinterface between Health and Well-being Boards and GP consortia. This is currently unclear and it remainsto be seen whether Health and Well-being Boards will have any real power over consortia’s decisions. If theBoards do not have formal powers with regard to GP consortia’s commissioning decisions, their role inintegrating the provision of health and social care may be limited. If, on the other hand, they do havestatutory powers, this would create a dual chain of accountability for consortia, with tensions potentiallyarising between the demands of local Health and Wellbeing Boards on the one hand and the national NHSCommissioning Board on the other.

23. One serious concern is that the loss of the geographical co-terminosity that currently exists betweenPCTs and local authorities may make collaborative working considerably more diYcult. Although the shapeconsortia will take is as yet undetermined, some are likely to straddle local authority boundaries, and manylocal authorities will need to forge relationships with multiple consortia. In addition to challenges regardingrelationship-building, the loss of co-terminosity introduces significant practical barriers resulting fromhaving diVerent local partners working with data flows and commissioning plans which cannot be alignedin terms of their geographical coverage. The impact of this would be heightened further if consortia areformed on the basis of aYnity rather than geography.

24. To facilitate the development of integrated models of provision, policy makers should avoid stickingrigidly to a separation of commissioning and provision. GP commissioners must be supported in developingservices that overcome barriers between primary and secondary care, between health and social care andbetween practices themselves. Regulations concerning conflicts of interest arising from being both a providerand commissioner should ensure transparency in decision-making without preventing GPs and otherprofessionals from innovating in this way.

Health Inequalities

25. Tackling the stark and avoidable inequalities in health that exist between diVerent groups and areasof the country requires a cultural change in which GP commissioners accept greater responsibility forprotecting and promoting population health as well as for the immediate needs of individual patients. It isimportant that the commissioning outcomes framework includes strong incentives for GP consortiaregarding health improvement and the reduction of health inequalities.



26. The interface between consortia and local authorities will again be critical for delivering on thisagenda. Consortia will need to build close relationships with local authorities and the new Public HealthService in order to work collaboratively on tackling health inequalities.

Specialised Commissioning

27. The previous Committee’s report on commissioning identified particular issues regarding thecommissioning of specialised services, with many PCTs giving this low priority and wide variations existingbetween local areas. Under the new proposals, the most highly specialised services will be commissioned bythe NCB rather than by GP consortia. Securing the necessary clinical engagement in specialisedcommissioning under these arrangements will be important.

28. There are a number of services which are not specialised enough to be commissioned by the NCB,but which could not be commissioned eVectively by individual consortia acting in isolation. Cancer, strokecare, trauma, and high-risk complex surgery are examples of services that fall into this category. To ensurequality and safety, these services are best delivered by concentrating services in specialist centres, and thecommissioning of them needs to occur across a larger geographical area or population.

29. To commission such services successfully, consortia will need to aggregate and commissioncollaboratively. It may not be suYcient to allow such collaboration to happen organically. The Departmentof Health will need to give careful thought to what structures or guidance may be needed to allow inter-consortia commissioning to be undertaken eVectively.

Conclusions

30. Although there have been recent improvements in the quality of commissioning in the NHS, manyof the shortcomings highlighted by the Health Committee’s last report on commissioning still exist, and thecharacterisation of commissioning as the “weak link” remains fair. International experience indicates thatother countries face similar challenges and there is no health care system in which commissioning is doneconsistently well (Dixon 2010).

31. The government’s proposed reforms aim to address some of the shortcomings in commissioning.However, they do so at the expense of considerable disruption to the operation of the NHS over the nextthree years, and while they may succeed in tackling some long-standing problems, they also introduce someconsiderable new risks. We would question whether the scale and pace of the reforms are necessary,particularly given the evidence that both the NHS generally and the commissioning function specificallyhave been on a path of gradual improvement over recent years (Thorlby & Maybin 2010). Unresolvedquestions raised by the proposals include:

— Where will the much needed local and regional system leadership reside in the absence of PCTsand SHAs?

— Will consortia be able to carry the financial risks associated with random fluctuation in populationhealth needs?

— Will organisational upheaval distract from the productivity challenge that the NHS needs to befocusing on over the next five years?

— Will the proposed constraints on management allowances make it diYcult for consortia to accessthe management support they will need?

32. As policy continues to be developed and refined, we hope that this inquiry will help bring greaterclarity to these diYcult but important questions.

References

Curry N, Goodwin N, Naylor C, Robertson R (2008). Practice-based commissioning: Re-invigorate,replace, or abandon? London: The King’s Fund.

Department of Health (2010). Equity and excellence: Liberating the NHS. London: TSO.

Dixon A (2010). “Purchasing health care in a cold climate”. Editorial. Journal of Health Services Researchand Policy , vol 15, pp 3–4.

Gainsbury S, Taylor A, Lewis S (2010). World class commissioning: PCTs raise the bar in final assurancetest. Health Service Journal 12 August 2010. Available at: http://www.hsj.co.uk/topics/world-class-commissioning-scores-2010/world-class-commissioning-pcts-raise-the-bar-in-final-assurance-test/5018158.article

Ham C (2010a). GP budget holding: Lessons from Across the Pond and from the NHS. Birmingham: HealthServices Management Centre.

Ham C (2010b). Working together for health: Achievements and challenges in the Kaiser NHS beacon sitesprogramme. Birmingham: HSMC.

Ham C, Smith J (2010). Removing the policy barriers to integrated care in England. London: NuYeld Trust.



Naylor C, Goodwin N (2010). Building high-quality commissioning. What role can external organisationsplay? London: The King’s Fund.

Thorlby R, Maybin J (2010). A high-performing NHS? A review of progress 1997–2010. London: TheKing’s Fund.

October 2010

Written evidence from the Royal College of General Practitioners (COM 122)

1. I write with regard to the Health Committee’s Inquiry into commissioning.

2. The Royal College of General Practitioners is the largest membership organisation in the UnitedKingdom solely for GPs. It aims to encourage and maintain the highest standards of general medicalpractice and to act as the “voice” of GPs on issues concerned with education, training, research, and clinicalstandards. Founded in 1952, the RCGP has over 42,000 members who are committed to improving patientcare, developing their own skills and promoting general practice as a discipline.

3. The College welcomes the opportunity to respond to this inquiry, which has been drawn up withreference to the College’s core statement of object, vision, purpose and values:

Object

The Royal College of General Practitioners is a registered charity with the object:

To encourage, foster and maintain the highest possible standards in general medical practice andfor that purpose to take or join with others in taking any steps consistent with the charitable natureof that object which may assist towards the same.

Our Vision

A world where excellent person centred care in general practice is at the heart of healthcare.

Our role is to be the voice for General Practice in order to: promote the unique doctor-patientrelationship; shape the public’s health agenda; set standards; promote quality and advance the roleof general practice globally.

Our Purpose

To improve the quality of healthcare by ensuring the highest standards for general practice, thepromotion of the best health outcomes for patients and the public and by promoting GPs as the heartand the hub of health services.

We will do this by:

— ensuring the development of high quality general practitioners in partnership with patientsand carers;

— advancing and promoting the academic discipline and science of general practice;

— promoting the unique doctor-patient relationship;

— shaping the public health agenda and addressing health inequalities; and

— being the voice of General Practice.

Our Values

The RCGP is the heart and voice of General Practice and as such:

— We protect the principle of holistic generalist care which is integrated around the needs ofand partnership with patients.

— We are committed to equitable access to, and delivery of, high quality and eVective primaryhealthcare for all.

— We are committed to the theoretical and practical development of general practice.

General Response

4. The RCGP has responded46 separately to the consultations on the Government’s White Paper Equityand Excellence: liberating the NHS and to Liberating the NHS: commissioning for patients. Our response tothe Health Committee’s Inquiry should be read in the context of our overall views on the proposed reformsto the NHS.

5. The College notes the Government’s definition of the characteristics of good commissioning, inLiberating the NHS: commissioning for patients47 (paragraph 1.6), as: to ensure high-quality outcomes;maximise patient choice; and secure eYcient use of NHS resources. We are keen to engage with these

46 Royal College of General Practitioners. Response to the Department of Health’s consultation Equity and Excellence:Liberating the NHS. London: RCGP, October 2010.http://www.rcgp.org.uk/policy/liberating the nhs.aspx

47 Department of Health. Liberating the NHS: commissioning for patient. London: HMSO, July 2010.



priorities and agree with the Department of Health that GPs, as clinicians who work alongside patients andpublic in the community, are in an ideal position to influence the direction of service development in theNHS.

6. We see that Commissioning for Patients makes a very strong case for the Government’s chosen model ofGP consortia commissioning services, supported by an NHS Commissioning Board (NHSCB). This modelinvolves a very radical alteration in the structures of the NHS, with many attendant costs and outcomeswhich are necessarily uncertain. We would urge that other models for commissioning services be considered.For example, some of our members have questioned whether commissioning of services by Primary CareTrusts (PCTs) could not be allowed to continue, but with far greater and statutorily guaranteed involvementby GPs and other clinicians at board level, as well as greater patient/public involvement. This might lead tomany of the benefits envisaged in Liberating the NHS,48 but without some of the risks.

7. Many of our members, particularly some of those in the early years of their careers, are enthusiasticto take up roles in GP commissioning. They recognise the inadequacies in the current system and areconfident, as are we, that they will be able to make better choices and achieve the goals identified inparagraph 5 above. That enthusiasm, however, is not universal, and is influenced by pre-existing experiencewith practice-based commissioning and the successfulness or otherwise of relationships with local PCTs. Wewould urge caution and flexibility in imposing the timeline for change to the proposed new model, to ensurethat GPs in all areas are able to take on their new responsibilities, and to ensure that examples of currentgood practice by PCTs are retained.

8. If, as seems likely, the proposals in Liberating the NHS: commissioning for patients are to beimplemented, we would urge that the Department of Health provide much more detailed guidance on theintended structures and governance models of GP consortia. Some of our members are reluctant or cautiouswith regards to the proposals, and in part this is down to a perceived lack of detail. GPs are being asked tostake their careers, their practices and the wellbeing of their patients on a new structure that has not beenextensively trialled—they would find greater detail and specificity in the proposals reassuring.

9. The funding of GP consortia will be a critical factor in determining their success. The lack of detail asto the funding formulas to be applied, the level of the management allowance, the relationship betweenconsortia and practice income, and the potential impact of current PCT budget deficits on the finances ofnascent consortia are all matters of concern for our members. It is diYcult for us to endorse these proposalsas enthusiastically as we might whilst these issues and their consequences remain unclear.

10. It is essential that GPs’ role as commissioners must not be allowed to detract from the crucial doctor-patient relationship and GPs’ longstanding role as advocates for their patients. We expect GPs to conductthemselves with the utmost probity, but there will still be the need for strict governance rules to ensure thatall commissioning decisions are open and fully scrutinised.

11 As stated above, the College is committed to the education of GPs and the development of the roleof General Practice. We are already actively producing material49 that will support GPs in bettercommissioning. If GP commissioning goes ahead, we expect to be at the forefront of providing andaccrediting education and training opportunities for our members, with the goal that all GPs, whether atthe start or near the end of their careers, and whether taking major or minor roles in commissioning services,are supremely well equipped to meet the challenges of this new environment.

Responses to Specific Questions

Clinical engagement in commissioning:

— How will commissioners access the information and clinical expertise required to make high qualitydecisions about the shape of clinical services?

— How will commissioners address issues of clinical practice variation?— How will GPs engage with their colleagues within a consortium and how will consortia engage with

the wider clinical community?

12. Clinical engagement is critical to the success of commissioning both to improve quality of care andto make savings which can fund innovation. For this to happen it is vital that all GPs (and in fact allclinicians) are aware of their individual and collective responsibility for resource allocation and demandmanagement. A small percentage of GPs will be required to take direct leadership roles in commissioning.This is a new demand for all, while at the same time undertaking existing roles, including training, clinicalwork, and running practices.

13. New GP consortia will clearly need excellent administrative staV. They will also need leaders who arecommitted to GP commissioning and have suYcient education and ability in this area. They will need thefinancial support to allow experienced GPs to be replaced in clinical settings for sessions where they are takenaway from front-line clinical work, and this needs to be kept to a minimum. Lead GPs will needsophisticated, multi-level training, information and guidance from central bodies such as the NHSCB andthe RCGP.

48 Department of Health. Equity and Excellence: Liberating the NHS. London: HMSO, July 2010.49 For example, the new online course Commissioning in General Practice: improving patient journeys launched on the RCGP

Online Learning Environment (www.elearning.rcgp.org.uk).



14. Consortia will need to develop systems for local peer review against relevant criteria—presumablyrelated to aspects of the Outcomes Framework and defined in partnership with patients and the public. Eachconsortium will need the capacity to collate, analyse, and compare data practice-by-practice.

How open will the system be to new entrants?

— Will care providers be free to oVer new solutions which oVer higher clinical quality, better patientexperience or better value?

— Will commissioners be free to access new commissioning expertise?— Will potential new entrants be free to oVer alternative commissioning models?— What arrangements will be made to encourage the Third Sector both as commissioners and providers?

15. There are grave concerns, expressed by many of our membership, about the level of engagement ofthe for-profit sector in the re-structured NHS. We recognise that for-profit companies may have much tobring to the NHS in terms of eYciency and management experience. The likely involvement of suchbusinesses, both in providing support services to commissioning consortia and, as a result of the “any willingprovider” stipulation, supplanting some existing primary and secondary care providers, may undermine theessential ethos of the NHS—to provide equitable, high quality healthcare for all, free at the point of use.The injunction that there will be no bail-out for failed commissioners would seem also to oVer the possibilityof private companies supplanting GP consortia. The College is open-minded with regards to engagementwith the for-profit sector but would also wish to restate the value of partnership between GPs and existingsecondary care organisations. Collaboration, we believe, far more so than competition, is the model whichwill result in the best possible outcome for NHS patients.

16. Although we understand the rationale for some choice among healthcare providers, factors that makefor successful local healthcare, such as providing continuity of care, eVective pathways and strongrelationships between primary and secondary care will not be measured if there is a literal application ofcompetition rules. The commissioning framework should also take account of these factors and be preparedto demonstrate flexibility.

17. Under the new arrangements GP practices will continue to be providers of primary care asindependent contractors. Practices can work together in federations, and in partnership with other providers(including local specialists, third sector organisations or private providers), to provide health servicescommissioned by the GP consortia. These Federations could also have a vital role in supporting GPs in thenew world of health care provision.

Accountability for commissioning decisions

— How will patients make their voice heard or their choice eVective?— What will be the role of the NHS Commissioning Board?— What legal framework will be required to underpin commissioning consortia?— How will commissioning interface with the Public Health Service?— How will commissioning interface with Health Watch?— Where will the “buck stop” when commissioners face hard choices?

18. We fully support the need for “no decision about me without me”, and our own best practice aims toshare decision making with all our patients. So patients should be able to make their voice heard toindividual clinicians, to practices, and via HealthWatch. However, complete autonomy across diVerentproviders can be costly and lead to duplication. Many of our members have grave misgivings about theapparent emphasis on “choice” in service provision in primary care. We feel that the policy of free choice ofGP practice, in particular, is potentially damaging and not warranted by patient demand. We would arguethat patient choice in primary care may be better accommodated by the development of GP Federations50

and other local measures. Clear and transparent procurement processes which show that clinical decisionsare not influenced by personal gain will be essential.

19. Clearly the constitution of local HealthWatch is critical in ensuring the patients’ voice is heard. If thesegroups are merely constituted so as to reflect ‘the same old voices’, we will miss the opportunity to reflect allgroups within local communities and risk perpetuating health inequalities and existing failures of inclusion.

20. We agree with the need for the establishment of the NHS Commissioning Board (NHSCB), and whilethe precise division of responsibilities between this and the commissioning consortia is not always clear, andwill presumably evolve, the broad proposals seem sensible.

21. We would envisage the NHSCB having a collaborative and supportive relationship in this respect,based on the sharing of information on best practice and the development of meaningful goals related tothe Outcomes Framework, rather than a policing role.

50 The RCGP has been promoting the creation of Federations of practices since the publication of its Roadmap document in2007 (http://www.rcgp.org.uk/PDF/Roadmap embargoed%2011am%2013%20Sept.pdf).



22. In monitoring primary care performance, it will be crucial for the NHSCB and consortia to bear inmind particular circumstances which may impact on specific practices—for example the vulnerability ofsmall practices to apparent statistical anomalies. Other factors, such as sociodemographic diversity orrurality, also alter practice activity, and all those assessing practice performance need a sophisticatedappreciation of these issues (hence the need for some public health competencies in commissioning).

23. The proposals for local HealthWatch to engage with local authorities and GP consortia, providedthey are established sensibly and with a view to being fully representative, are a useful start as a way to getpatients involved in commissioning decisions. We would also support the inclusion of lay members onconsortia boards, and association with patient groups at practice and consortium level, though the viabilityof these will depend on the management allowance apportioned to consortia. If consortia and the NHSCBpublish full financial and other information, such as their vision, aims and principles, and the public areeducated in the opportunities and limits of commissioning, there will be a real opportunity for local publicscrutiny and engagement with decisions made.

Integration of health and social care

— How will any new structures promote the integration of health and social care?— What arrangements are proposed for shared health and social care budgets?

24. The proposals oVer GPs a greater chance to work more closely with local authorities, social servicesand specialist providers. The RCGP believes that integrated working between health and social care isimportant to ensure a joined-up and holistic approach is taken to the delivery of care in the community andthe eVective reduction of health inequalities.

25. Health and social care budgets are tight now. It is likely that they will become tighter with increaseddemands and pressures on them. As pressure increases on the NHS and social care services budgets it is evermore essential that services are delivered as eYciently as possible. It is hoped that greater clarification willbe provided by the Government’s forthcoming proposals for the future funding of social care and the WhitePaper on public health later this year.

What will be the role of local authorities in public health and commissioning decisions?

26. We support the devolution of NHS responsibilities to local authorities and their role, through localhealth and wellbeing boards, in assisting coordination between healthcare, public health and social careproviders. These seem like sensible measures that will increase the democratic legitimacy of healthcareservices, and GPs look forward to working with local authorities to support public health. We are concerned,however, that at a time of serious financial strain it may be more diYcult for local authorities to allocate theappropriate resources to this role, and that this may result in outcomes that are less impressive, and aboveall less equal, than might otherwise be hoped for.

27. There is a challenge in the proposals, in that GP consortia may well not be coterminous with localauthorities—each consortium may need to work with the Health and Wellbeing Boards, Directors of PublicHealth and HealthWatch organisations of more than one local authority, and vice versa. This presents abureaucratic challenge, though not an insurmountable one if adequately funded.

How will the new arrangements strengthen commissioners against provider interests?

28. The White Paper states that there must be a clear separation between the commissioner and theprovider. Local specialist colleagues might be very valuable in service redesign, but they should not beexcluded from a tender under the “any willing provider” rule. Nor should GPs who oVer a referral servicewithin their own area be excluded as they may provide a cost eVective local service.

29. Additionally there are concerns that consortia maybe too small to be eVective in negotiating withdominant providers. In this case, smaller population consortia may need to join with others with sharedinterests, to ensure their bargaining power is eVective and to manage financial risk.

30. One of the principles underpinning commissioning, proposed by the RCGP,51 is a system of trustbetween provider and commissioner with a minimum amount of onerous reporting and accounting.

31. Some of our members have suggested that consortia will need to appoint external organisations tosupervise or approve their primary care commissioning. Alternatively, a committee elected by GPs in theconsortium may be able to hold the authority.

32. Additionally, consortia should be obliged to report contract profiles, and publish financial and patientsatisfaction and outcome information, so that patients and the NHSCB can hold them to account.

51 Royal College of General Practitioners. Update on Commissioning Activity. London: RCGP, September 2010.http://www.rcgp.org.uk/pdf/Update on Commissioning Activity.pdf




33. Many of our members do have concerns that the proposals around commissioning consortia have thepotential to increase health inequalities within and between commissioning areas. Health inequalities shouldbe explicitly featured in the proposed Outcomes Framework, with outcomes mapped across social groups.Strong input from patient groups and local authorities into the local Joint Strategic Needs Assessment(JSNA), if conducted appropriately, should also give consortia goals to aim for. Additionally, there needsto be sharing and encouragement of best practice in this area, guided by national organisations such as theRCGP or the Commissioning Board itself.

34. It is important that when GP commissioning groups consider the health of their local populationsthey commission appropriate services for their vulnerable citizens, this includes the homeless, travellers, sexworkers, and asylum seekers (the inclusivity agenda). While there are good examples of care provided tothese groups across the country there are many areas where it is poor. The White Paper, which gives GPsleadership roles in commissioning, provides the opportunity to address this through commissioning as wellas through closer working with local government and the third sector.

35. Another significant concern is the eVective abolition of practice boundaries implie within the WhitePaper by the assertion that patients will be able to choose any GP that they wish to see. As already arguedin the College’s response to Department of Health’s “Your Choice of GP” consultation, this will have asignificant impact on GP workload and continuity of care, exacerbate existing inequalities betweenpractices, and potentially place a terminal strain on some, particularly rural, local services. Clarification isneeded on how geographic commissioning would work if practice boundaries are abolished.

How will the proposed system facilitate service reconfiguration?

Transitional arrangements

— Will the new arrangements safeguard current examples of good practice?— Who will drive innovation during the transitional period?— How will transitional costs (redundancy etc) be minimized?

36. We would hope for a particular engagement from the NHSCB in supporting lead GP commissionersin the initial stages of the transfer of commissioning responsibilities. Input at this stage could be very helpfulin avoiding damaging early errors. It should work with the RCGP and other bodies to develop and shareguidance on best practice.

37. Consortia will also need to be engaged in providing eVective education to their members, so that bestpractice can be identified and shared.

38. We are sceptical, however, that the reforms outlined in Liberating the NHS will save money, in eitherthe short or long term. There are always enormous costs associated with reorganisation, in this case theredundancy costs of several whole tiers of NHS management, as well as the likely expansion of GeneralPractice staV and facilities. If, as the White Paper suggests, there will be 500 GP consortia, many of ourmembers fear that the necessary duplication of management and administrative costs will actually make thenew system more expensive. The loss of GP sessions from clinical work into service development also hasmajor resource implications.

Resource Allocation

— How will resources be allocated between commissioners?— What arrangements are proposed for risk sharing between commissioners?— What arrangements will be made to safeguard patient care if a commissioner gets into diYculty?

39. Consortia will need to employ support from finance managers and accountants, for which they willneed adequate financial resources—this should not be underestimated. And as discussed already they willneed considerable education resources, as financial risk management at the scale of consortia is beyond thecurrent skill set of most GPs. Beyond this, the NHSCB should be prepared to step in quickly with supportif it looks like a consortium may be failing financially, and there should be transparent processes for thesesituations so that any risk to continuity of care is avoided. With regards to underspends, it will be criticalnot to disincentivise eYciency.

40. Clarity about the budgetary commitments of consortia, local authorities and other stakeholders, aswell as the level of existing debt which consortia will be expected to take on, will be essential to ensure thereis no collapse in funding. The Health and Wellbeing Boards should be a viable mechanism for managing this,and will need to be established early on to work with consortia during the transition period. The NHSCB willhave a role in ensuring that these relationships are facilitated.



Specialist Services

— What arrangements are proposed for commissioning of specialist services?— How will these arrangements interface with the rest of the system?

41. We feel that consortia will have a role in facilitating better communication between primary andsecondary care, and developing more stable care pathways, so that standards of referral may be improved.

42. As indicated earlier, we have concerns that the emphasis on “any willing provider” for healthcare willimpede the development of eVective co-ordinated services. We are concerned that if consortia are obligedby Monitor, in its role as a competition regulator, to consider all tenders for services, it will be more diYcultto form the partnerships between primary and secondary care providers that are the absolute cornerstoneof eVective healthcare.

43. Additionally, we would argue strongly that GP commissioners should be integrally involved in thecommissioning of maternity care. The consequences of lack of GP involvement in maternity care arediscussed in depth in the recent Kings Fund report.52 General Practice has a vital role in antenatal andpostnatal care, as part of the lifelong continuity of care that is central to the NHS. Many of our membersdo not see why maternity services should be primarily the domain of the NHS Commissioning Board ratherthan the proposed consortia.

Concluding Comments

44. General Practice is the central plank in our world-class healthcare system. The College thoroughlyagrees that it makes a great deal of sense to give GPs, with their unique patient-centred perspective, a centralrole in commissioning and directing healthcare services. Whether this is done through the proposedconsortia model, or by involving GPs more centrally in existing models, we are confident that GeneralPractice can rise to the challenge and institute changes in service provision that will improve healthcareoutcomes.

October 2010

Written evidence from Dr Peter Davies (COM 127)

The New Commissioning Landscape: A GP’s View

Speaking personally rather than on behalf of any organisation.

The NHS white paper, “Liberating the NHS” is a major challenge to GPs, and to the NHS as a whole.

Up till now individual doctors and other health professionals have tended to practice medicine on adeontological ethic—namely the duty of one person to another. The relationship has been personal, private,and mostly confidential. The decisions made (hopefully in a sensible, patient centred and evidence basedmanner) have then been enacted.

These clinical decisions result in prescriptions, investigations, referrals, operations, rehabilitation and useof other services. These all have significant costs attached. Up till now the NHS has picked up the bill forthese. At the doctor-patient level the costs are not often mentioned. In the limit however health secretariesare always under pressure to yield on costs as the doctors can “shroud wave” saying, “my patient needs thistreatment, and look the NHS is not funding it.” The Scots remind us that, “there’s nae pockets in a shroud.”

The NHS as a whole is a utilitarian enterprise. It is on the whole a good pooled risk shared insurancescheme into which we pay collectively, but use freely as individuals when the need arises. However a healthsystem raises money (tax, user charges, employer contributions) the amount of money in any health systemis always finite. Any health care system has three functions—namely revenue raising, revenue distributionand spending on services.

There is a conflict between the utilitarian ethic of the NHS system (wanting to do as much good as it canfor as many people as possible, but accepting it will never do everything for everyone, no matter how wellfunded it is) and the deontological nature of the individual doctor-patient interaction. (wanting to do ourbest for each single patient, to a large extent oblivious of everyone else).

The new commissioning plans will bring this conflict out into the open. As a doctor I will start to thinkthat I have done a morning’s work, and seen so many patients and spent so much on running my surgery,so much on tests, so much on prescriptions, so much on referrals. I am going to have to become far moreconscious of how much NHS (taxpayer’s) resource I am committing to my recommendations to my patients.At one level this is good—it makes my work and its clinical and cost eVectiveness more transparent. Atanother it may become obvious that rationing is occurring at the level of the GP-patient interaction. GPs(and GP commissioning consortia) will need support (protection from complaints, protection from mediahowls) when this occurs. If this support is not forthcoming then the GP front line of the NHS will collapseand eYcient use of NHS resources will become impossible.

52 Smith A, Shakespeare J, Dixon A. The role of GPs in maternity care—what does the future hold? London: The King’s Fund,2010. http://www.kingsfund.org.uk/document.rm?id%8734



With this White Paper Andrew Lansley has given me as a GP a massive challenge. For many years GPshave prided ourselves on our relative cheapness and our “gatekeeper” role. Well these reforms will test outwhether we do perform this role as well as we like to think. If we can deliver successfully on these reformsthen we will deserve much credit. If we do not we will probably fail badly, as other commissioners have donebefore us.

The new GP commissioning consortia may bring out a group of well informed industry insiders asmanagers- people who actually know their field well, and its strengths, weaknesses and pitfalls. The evidenceI have read recently (eg GeoV Colvin’s book “Talent is Overrated” Nicholas Brearley Publishing 2008) isthat “general management” is a chimera and that the strongest industries bring through people who combinetechnical with managerial knowledge. The old PCTs tended to have limited clinical engagement, and so forexample you could see the absurdity of a “clinical safety meeting” taking place with no doctor or nurseinvolved.

There are many unknowns with these new proposals. They represent significant extra work and significantchallenge to me personally, to my practice, my local area and to GPs as whole.

Personally I am quite optimistic about these proposals seeing many opportunities in them for myself andmy profession to deliver better services to patients. In particular if the proposals are implemented so thatclinicians can streamline local services on a systems based approach (eg as described by John Seddon in“Systems Thinking in the Public Sector: The Failure of the Reform Regime…. and a Manifesto for a BetterWay”. Triarchy Press, 2008) looking at patient flow through the NHS system then there is a chance toimprove how whole systems work. A frustration of many GPs is that they try to do their part of the workwell, but struggle when care passes onto other agencies eg Community Mental Health Teams, and thehandovers are slow, and awkward, and professionals are trying to guess who has said and done what.Fragmentation of care is costlier and riskier than continuity of care. If GPs and the commissioning consortiaare allowed to break down the many NHS silos (see p 26 of Davies and Gubb Putting Patients Last—Civitas,London 2009, or Commandment 3 p 45 of “The Ten Commandments of Business Failure” Donald Keough,Penguin 2008) then much progress could ensue—that could be more eYcient in terms of patient journeysand in terms of smooth economics—the NHS squanders money on silly administrative delays that couldwell just disappear- to everyone’s benefit.

However I can see many dangers as well:

— The number of roles and posts open to GPs expands so we end up as a scarce resource- or we endup each trying to do too many things.

— Many GPs struggle to get their heads around the logic of these changes and retire or move away.

— There will be a large need for education in budget management and commissioning skills—eventhose of us who can see the logic of these proposals may have more enthusiasm than skill forimplementing them. At present as a GP I can read my practice accounts covering turnover of about£1.2 million per year with reasonable comprehension. The local PCT.’s budget is about £220million per year. My practice’s commissioning budget for hospital activity and prescriptions forour patient list of 10,800 is £3,663,503 per quarter (April to July 2010 figures, about £14.65 millionannually) or an annualised averaged cost of £612 per patient on hospital activity and £167 onprescriptions. On these figures my practice is spending about 10% more on clinical activities thanplanned against our indicative budget. It is only in the last year or so that I have come to have thiskind of figure readily available, and begun to discuss it with colleagues. The PCT is not yet lookingto alter the behaviour of individual practices specifically but is aware of its large “overtrade” withthe acute sector, and the need to reduce this.

— The management role is under funded—and so GPs stay in their surgeries rather than get involvedin complex and poorly remunerated PCT work.

— The policy fails to bed in and is changed again in five years time—after all White Papers come andWhite Papers go, and still there are civil servants writing another.

— The national tariV does not adapt quickly enough to allow consortia to justify changes in practice.Meanwhile providers swallow up ever more resources via payment by results.

— The National TariV drives fragmentation and itemisation of care, rather than its integration.

— Local commissioners need authority to make the right locality decisions and trust that the centrewill back the periphery if any questions or conflicts arise.

— Acceptance of variation between localities will become necessary. DiVerent areas will makediVerent decisions with diVerent outcomes. Cries of “postcode lottery” will need to be drowned outby cries of “local needs met” and “local priorities set and achieved.”

November 2010



Supplementary written evidence from Dr Peter Davies (COM 127A)

I have now had a chance to reflect on what was said last Tuesday 2 November 2010 at the Health SelectCommittee. Please may I add three points to my previous written testimony? As far as I can tell these pointshave not been made before amongst the medical witnesses or through the MP’s questioning.

1. Is the commissioning being done at the right level of the NHS?

At present the plan seems to be that primary care must commission secondary care. This is fair enough,and an opportunity for me as a primary care clinician. But it can be argued strongly that primary andsecondary care are both medical service providers. Perhaps commissioning should be at the level of theoverall service or overall patient pathway rather than of one part of the system by another. Setting one partagainst another may result in disjointed services. Perhaps the answer to smooth patient pathways lies inintegrated care organisations that make the move between primary and secondary care as smooth aspossible, rather than in organisations such as commissioning consortia that will debate every referraldecision in terms of cost and utility?

2. NHS as a monolithic monopoly

As I said at http://www.civitas.org.uk/nhs/refusingtreatment commentary.php<davies “No non-market,planned economy has ever succeeded in matching supply with demand. You can have as many intermediateprocess measures and lengthy reports as you like, but the outcome of centralised processes such as UkrainianTractor Production or the NHS’s MTAS scheme tend to be disastrous.”

I think monopolies are intrinsically ineYcient, and tend to generate internal rules, restrictions andhindrances rather than smooth running systems of care. In terms of John Seddon’s book “Systems Thinkingin the Public Sector” (Triarchy Press) monopolies usually increase failure demand and resource wastagerather than deliver to value demand more eYciently. Although you can argue in terms such as “The NHSfamily” and “universal and comprehensive” in fact the NHS as experienced by particular patients inparticular places is often local, disjointed, variable and parochial. Examples of failure demand and systemfailures (eg notes going astray, letters not written or delivered, apparently random clinic appointmentrearrangements) are common throughout the NHS. If alternative willing providers can provide a betterservice in an innovative way then from a patient service viewpoint I cannot see why they should be preventedfrom doing so. Perhaps the reason many in the NHS fear the arrival of the private sector is that the privatesector may have the ability to do things better than the NHS does.

3. Health Inequalities—the middle class have health needs too

In the oral evidence from Dr Jonathon Tomlinson the case was made about health inequalities and aboutmoving the resources to meet the greater health needs of disadvantaged people. This is true, and fair up toa point. However the NHS is a national institution that intends to provide care to all the people of Britain,on the basis of the people’s pooled contributions and for their medical needs as they arise, and regardlessof their social standing. On this basis it needs to provide a good service to all UK citizens, and this includesupper and middle class patients as much as the poorer classes. Sometimes I hear advocates against healthinequalities and feel that they only see complexity and co-morbidity in poorer patients in poor areas oftowns. This is a partial perspective, and middle and upper class patients can be just as demanding for doctorsto deal with, and their health needs are equally legitimate.

Thank you for allowing me the opportunity to contribute to this ongoing and fascinating debate.

November 2010

Written evidence from Dr Jonathon Tomlinson (COM 128)

I welcome the intention to increase the role of clinicians in management decisions.

Nevertheless

The aim of any system of universal healthcare is to distribute healthcare according to need, hence avoidingthe ‘inverse care law’ which states: “The availability of good medical care tends to vary inversely with theneed for it in the population served. This … operates more completely where medical care is most exposedto market forces, and less so where such exposure is reduced.” (Hart, 1971)

Evidence about health inequalities shows that the inverse care law still holds true today, and yet the aimof distributing care according to need has been replaced with the aim of distribution according to marketforces. Economists as diverse as Freidrich Hayek, Adam Smith and Amartya Sen, all recognised thatmarkets are blind to need. Whereas healthcare distributed according to need may be eYcient, the converseis not true; for example refusing to treat someone may be cheaper than treating them and screening low riskpopulations can be highly profitable.



Commissioning increases the role and eVect of markets in the NHS and will therefore exacerbate healthinequalities. As GPs our primary duty as codified by the General Medical Council is to our patients.Monitor, the body set to oversee commissioning will add the conflicting duty to behave competitively andeYciently. Well educated, motivated patients with uncomplicated needs that are amenable to medicalsolutions can be looked after eYciently and will therefore attract more resources. Complicated patients withhigh levels of socially determined health needs, complex medical problems, low literacy and chaotic lifestylescannot be looked after as eYciently and we will lose resources even though their needs are greatest. It isimportant to note that the very best quality care may not be eYcient. Patients in primary care very oftenneed a doctor who listens, who is considerate, understanding, sympathetic and who gives a clear explanationand reassurance. It is hard to see how, if at all, visiting a bereaved patient or taking time to discuss a seriousdiagnosis can be deemed eYcient. Up to 30% of patients in primary care and 50% in secondary care consultwith medically unexplained symptoms. The evidence is that these patients benefit from continuity of careand are harmed by excessive investigations. British general practice has a universally admired tradition ofcontinuity of care but this will be undermined by a plurality of providers and payment by results rewardsexcessive investigations.

The serious choices patients have to make, such as when to stop chemotherapy, whether to die at homeor in hospital, whether to continue with an unwanted pregnancy depend on continuity because they are bestmade with a doctor they know and trust. These choices are far more important to patients than the choiceof hospital.

GPs in aZuent areas with low levels of need are already supplementing their income by oVering cosmetictreatments, whilst in deprived areas GPs still lack the resources to manage serious physical conditions,psychological problems and drug or alcohol addiction.

Forcing providers of health within the NHS family to compete with one another instead of collaboratingis a great threat to the provision of integrated care. My patients with serious long term conditions dependon close collaboration between primary, secondary and community care. The purchaser provider split andpayment by results are already damaging the relationship between GPs and their hospital colleagues; GPsare suspicious that their hospital colleagues see patients in order to earn money even when they could bemanaged in primary care and hospitals worry that GPs are working beyond their expertise by holding ontopatients in an attempt to make savings.

The abandonment of practice boundaries risks young, mobile patients with few health needs joiningpractices designed for them, leaving other practices to look after greater concentrations of complex, elderlypatients. Historically, GPs have been able to aVord to manage their complex patients because they have abalanced population, including an income from young people who only consult occasionally.

The conversion of the National Health Service into a fragmented system of competing providers basedon profitability marks the end of universal health care planned and distributed according to need.

November 2010

Supplementary written evidence from Dr Jonathon Tomlinson (COM 128A)

Response to Meeting

I thank the Health Committee very much for the opportunity to speak.

There are just three comments.

1. One of the last questions from the committee was on the cost of commissioning. The questionerreferred to the cap on administration costs.

Presently my PCT receives £33 per patient. We have been told that our commissioning group willreceive just £9 per patient.

My reply informed the committee that the administration and transaction costs of running amarket are higher than running a non-competitive system. Not only will we (City and HackneyGPs) have to take over PCT functions on a fraction of the budget, but we will be expected to takeon the significant, additional costs of managing a competitive market. This is not recognised in theWhite Paper.

2. EYciency is aimed at maximising profit. It’s essential that we don’t confuse maximising eYciencywith responding to clinical need. If Dr Charlson sets up a blood testing enterprise on the doorstepof my surgery he may well be enterprising and eYcient (blood tests are easy to organise eYciently),but he’s not responding to patient need, because we already do our own blood tests. Our patientsneed more drug and alcohol rehab provision, but under the proposed system it is not going to beprovided unless it is profitable, in spite of the desperate need.



3. The other speakers objected to my comparisons with the US system. In my defence I will explainthe similarities and I include the quote I read out and a reference.

The White Paper proposes that NHS services become social enterprises and hospitals becomefoundation trusts. These processes will allow the transform of the NHS from a publicly ownedservice into privately owned businesses. Secondly the intention to remove practice boundaries andallow patients to register with commissioning consortia is based on the US Health ManagementOrganisation (HMO) model. Thirdly the conversion of the NHS into competitive markets convertsmedical care into a commodity in trade. Finally and most importantly, the major privatecompanies competing to provide services to the NHS (like United Health) are US health carecompanies. It is for these reasons that I believe that comparisons with the US are vital if we are tounderstand our future prospects.

Quotation

“The US devotes a much larger fraction of its GDP to health care than other advanced countries—nearlytwice their average. We spend, in US dollars per person, two and a half times as much as our counterpartsin Europe. The most important reasons for the uniquely high costs are its commercialization and the eVectsof business incentives on the provision of care. The US has the only health system in the developed worldthat is so much owned by investors and in which medical care has become a commodity in trade rather thana right.” Health Care: the disquieting truthhttp://www.nybooks.com/articles/archives/2010/sep/30/health-care-disquieting-truth/?utm medium%email&utm source%Emailmarketingsoftware&utm content%229811853&utm campaign%September302010issue&utm term%HealthCareTheDisquietingTruth

November 2010

Written evidence from Professor Martin Roland (COM 129)

Professor Martin Roland, General Practitioner and Professor of Health Services Research, University ofCambridge. Oral evidence to be given 16 November.

1. The history of primary care led commissioning in the NHS is not encouraging. GPs took slowly to theintroduction of fundholding in 1991. A few enthusiasts improved care for their patients, but overall, theeVect was modest. Inequalities in care increased and GPs were not strategic in their purchasing decisions.The limited initial scope of fundholding was extended in 1995 under a scheme called “total purchasing”, butthat model didn’t really get going before it was abolished by the incoming Labour government in 1998.Primary care trusts proved to be risk averse, bureaucratic, and ineVective commissioners, which led thegovernment to revert to giving GPs notional budgets under “practice based commissioning” in 2004. TheeVects were again patchy, with GPs slow to get involved and with mixed levels of enthusiasm. By 2009,substantial numbers were engaged and starting to show some success in improving services. Despite that,practice based commissioning was described by the government’s own primary care tsar as “a corpse not fitfor resuscitation”.

2. Despite this discouraging experience, the idea persists that GPs hold the key to eVective purchasing ofhigh quality care for their patients. Current proposals to form GP commissioning groups will give them thebiggest challenge of a generation—with 75% of the NHS budget under the control of GP practices. The risksof the scheme have been well rehearsed: GPs don’t want to hold budgets, they haven’t got the skills, theywill need extensive management support, and multiple purchasers will cause contracting chaos especially inbig cities. In order for GP Commissioning to be successful in its new guise, a number of things are needed.

3. The first is for a suYcient number of GP leaders. Not all GPs have to be actively involved incommissioning, but substantial numbers do. Their motivation has to be to improve care for patients. TheRoyal College of General Practitioners sets out the values that define the profession—high quality technicalcare, personal care, continuity of care, and a commitment to individual patients that makes being a GP aprofession rather than just a job. The College will be providing advice and support to GPs in theircommissioning roles. This will be very important at a time when support will also be oVered by privatecorporations who may not share these values. Management support for commissioning will be a significantchallenge as the commissioning reforms are being brought during a period when the NHS plans a 45%reduction in management costs.

4. GPs face a number of potential conflicts of interest. Of these the most important is that GPs may havea financial incentive not to refer patients even when they believe that they would benefit clinically from aspecialist opinion. The second is that GPs as both commissioners and providers may be able to commissioncare from themselves or from provider organisations in which they have a financial interest. These conflictsof interest will be easier to manage if GPs can neither make substantial personal profits from commissioningnor put their practices at risk of major financial loss.



5. The formula that government decides to use to distribute budgets to GP commissioning groups hasthe potential to cause major instability. An untested resource allocation formula (the Carr Hill formula) wasintroduced with the 2004 GP contract and had to be rapidly replaced as the sole basis for resource allocationbecause it produced large and unexpected changes to practice budgets. If the government pilots nothing else,it must pilot a range of resource allocation formulas before giving commissioning groups their budgets.

6. Commissioning groups will also have to learn how to manage risk, either through arrangements thatlimit the cost to their budget of individual patients, or by insuring, or by pooling risk. They must makecertain that patients with complex or expensive needs can register easily with a GP and receive the carethey need.

7. GPs should generally form large geographically defined groupings. This will reduce the turmoil thatmultiple small purchasers will create, will allow them to be more eVective commissioners, and will helpintegration with community and local authority services. However, they will need smaller subgroups forquality improvement and clinical audit to be eVective. One size will not fit all the functions required of acommissioning group. GPs must also develop close relationships with hospital specialists and social careproviders: purchasers and providers must work together to deliver the integrated care that their increasinglyelderly populations need.

8. In developing and commissioning pathways of care, GP commissioning groups will need to developand maintain close links with local specialists. This is essential to provide the integrated care that theincreasingly elderly population needs. There is concern that the policy of allowing “any wiling provider” tobid for services may prevent GPs developing close links with specialists. Monitor must establish rules fortendering which do not stand in the way of GPs and specialists planning coordinated care for theirpopulations of patients.

9. Government must be encouraged to have the patience to see these reforms through. Major healthservice reforms cause years of disruption and it may take four or five years just to get back to where we arenow. Research should inform changes along the way, but two full parliaments will be needed to knowwhether the latest commissioning experiment has been successful.

November 2010

Supplementary written evidence from Dr Paul Charlson (COM 130)

Further my provision of oral evidence today (2 November) I would make the following points:

— There current NHS has become over burdened with data collection for targets.

— PCTs have been risk adverse to the point of stunting innovation, which although has occurred ithas not been significant enough to create whole system change.

— The management of the NHS has become too large and expensive.

— No change is not a good option.

— The pace of change is fast and will create expense and a potential vacuum in the transitional period.An evolutionary change where PCTs hand over to GP consortia is preferable.

— There is a danger of losing the best managers to other sectors during the transition period.

— Many small but important backroom functions of PCTs need to continue during the transition.

Potential Tensions with GP Consortia

— The best practices will want to be involved in commissioning but may also want to be providers.It is unrealistic to prevent this but it must be managed carefully.

— GP consortia will not be particularly keen to include struggling practices. These will need to besupported and brought up to standard.

— Some good GPs will need to virtually give up clinical practice- this may however prevent burn out.

— Dealing with practices who fail to conform to out comes set by consortia.

Competition

— In my view NHS hospital trusts have become too powerful—the balance of provision needs to shiftto primary care and other equal or better quality providers where appropriate.

— NHS consultants should not be contractually obliged to work solely for a single trust and shouldbe allowed to work for other providers.

— AWP contracts need to be policed to prevent gaming—although currently hospitals do “game” toimprove income. Sophisticated contractual arrangements need to be in place.

— National list of excluded treatments needs to be drawn up which should not be funded by taxpayer.



— Patients should be able to seek patient with any provider via Choose and Book.

— Co-payments for non clinically indicated non generic medication and certain treatments on theexclusion list need to be considered.

Patients

— Patients need to be involved in local GP practice and consortia decision making- simply having avoice on a consortia board is not enough.

— Patients need to take part in diYcult cost based decision making.

— Clinical demand needs the involvement of patients in order to manage the cost envelope.

— Evidence based patient need is required.

Local Authorities

— Will need to work particularly with public health to achieve outcomes.

— May take over some of the back functions of PCTs at least in the short term.

Clinicians

— Most should continue to work as clinicians.

— Primary and secondary care to work closely to redesign care. Consultants should be freed ofdiYculties around working for other employers as well as their employing trust to enable this.

— The GP consultation is key to managing quality and cost. It should be longer. More time shouldbe spent consulting.

— Continuity of care is important in managing long term conditions.

— The use of other clinicians is important in bringing about changes in work patterns required.

— The use of a reliable single clinical record is critical.

— Use of technology to reduce face to face work eg telemedicine is necessary.

Conclusions

The current system is failing to deliver as much as it should and is weighed down by unnecessarybureaucracy leading to a bloated and sometimes ineVective management. Clinicians and patients are oftenleft frustrated as a consequence.

GP commissioning is a good idea. Innovation and change is required in order to face the challenges ofthe future. I feel this will be realised by the White Paper reforms.

The management of the transition and the pace of change are crucial.

Competition and plurality of providers properly managed through contracting will produce desiredsystem change.

All clinicians need to work together to design the best pathways of care.

Patients have a key role in commissioning decisions and demand management.

True patient choice is needed.

Local authorities do have a role particularly in supporting public health measures.

Opposition to reform can take many forms but I suspect some opposition is from those who benefit fromthe current system or are change adverse. Terms like “destabilisation” “privatisation” “not the NHS” areused in a negative way without looking at what they actually mean to patients.

It is my view that the NHS often runs for the system rather than for patients.

We should not look at the US health system as the alternative way forward but those of our Europeanneighbours. Some elements of several systems(including the US) should be considered.

November 2010



Written evidence from Professor Gwyn Bevan53 (COM 131)

Executive Summary

(i) This note aims to give evidence relevant to following issues in the terms of reference of the HealthCommittee’s inquiry into Commissioning:

(a) Clinical involvement, clinical practice variation, risk management and budgeting;

(b) Integration of primary and secondary health care and designing a market for new entrants intocommissioning; and

(c) Engaging GPs, patients and the public in making hard choices in commissioning.

(ii) Clinical involvement, clinical practice variation, risk management and budgeting. GP consortia arelikely find that GPs have interests in being involved in commissioning diVerent services and it is diYcult toinvolve GPs in budgeting. Allocating resources to practices with reference to targets derived from a formulausing estimates of the relative needs of populations (and unavoidable variations in costs) will show largevariations for some practices between their estimated past expenditure and their estimated future targetallocations. Information on Clinical Practice Variation (CPV) can help make sense of these diVerences.

(iii) Integration of primary and secondary health care and designing a market for new entrants intocommissioning. The division in British medicine between hospital specialists and General Practitioners (GPs)and between commissioners and providers makes it diYcult to create high-performing Integrated Insuranceand Delivery Systems (IIDSs) as in the US, such as the Group Health Cooperative of Puget Sound and theKaiser Permanente Health Maintenance Organisation. Evidence suggests that these IIDSs are more costeVective than the NHS. But US experience shows that it has proved diYcult to replicate this model in theUS. It would also be diYcult to satisfy the characteristics that result in high-performing IIDSs in the EnglishNHS. Allowing GP consortia to form integrated organisations with hospitals has potential to create muchbetter care than now, but could also result in some dysfunctional organisations (as happened in the“backlash” against managed care in the US). Such integration is hence risky if there is no choice betweenGP consortia. One policy option would thus be to design choice and competition between commissionersand allow new entrants subject to regulation by Monitor (as the new proposed economic regulator). Overtime, commissioners could be free to negotiate with providers, could develop into IIDSs, could restrictpatient choice of provider on grounds of quality, and replace rationing by Ministers with individualschoosing between benefits packages.

(iv) Engaging GPs, patients and the public in making hard choices in commissioning. GP consortia will haveto make hard choices in commissioning. To do this it is helpful to use a “socio-technical“ approach designedto generate information on costs and benefits so that this can be used systematically by patients, carers andstaV providing social and clinical services. The Systems Modelling for Performance Optimisation andService Equity (SyMPOSE) research programme at LSE has developed such a socio-technical approach, ina five-year research programme funded by the Health Foundation. This research has developed a visualgeometry which makes transparent three key concepts for stakeholders: population health gain, Value forMoney, and scenarios that order interventions in terms of VfM. This approach has been developed withPCTs in the Isle of Wight and SheYeld and used by these PCTs to make strategic changes. In SheYeld thestrategy of eating disorders has potential materially to reduce costs and produce health gain.

Evidence from Gwyn Bevan

1. This note aims to give evidence relevant to following issues in the terms of reference of the HealthCommittee’s inquiry into Commissioning:

(a) Clinical involvement, clinical practice variation, risk management and budgeting;

(b) Integration of primary and secondary health care and designing a market for new entrants intocommissioning; and

(c) Engaging GPs, patients and the public in making hard choices in commissioning.

53 Gwyn Bevan is Professor of Management Science and Director of the MSc in Public Management and Governance in theDepartment ofManagement at theLondonSchool of Economics andPolitical Sciencewhere he is an associate of two researchcentres: LSE Health and the Centre for Analysis of Risk and Regulation. His current research includes: comparisons ofperformance of health care and schools across the UK; developing methods for reducing NHS expenditure for least harm;methods of equitable funding of insured populations; and implications of introducing purchaser competition into the EnglishNHS. He is a member of the Department of Health’s two advisory groups on formulas used to allocate resources to PrimaryCare Trusts. His report for the Secretary of State for Health on the developments of these formulas was published in 2008.From 2001 to 2003 he was Director of the OYce for Information on Health Care Performance at the Commission for HealthImprovement (CHI) where he had lead responsibility (for the NHS in England) for: developing “star ratings”; nationalsurveys of staV and patients; developing national clinical audits; and analyses for CHI’s clinical governance reviews,investigations, and national studies. He has worked for the National Coal Board, HM Treasury, and an economicconsultancy; and, as an academic, at Warwick Business School, and the Medical Schools of St Thomas’s Hospital and BristolUniversity.



Clinical involvement, practice variation, risk management and budgeting

2. GP consortia may be seen as extensions, in both scale and scope, of GP fundholding in the 1990s. SomeGP fundholders piloted such extensions as Total Purchasing Pilots (TPPs): in principle GPs of TPPs couldopt to commission all of Hospital and Community Health Services (HCHS); and TPPs varied from beingsingle fundholding practices to large networks.

3. In practice TPPs opted to commission selected services only (Mays et al, 2001). GP consortia may needto work out how to organise commissioning with GPs may also decide to focus on their involvement indiVerent services.

4. The evaluation of TPPs gives findings relevant to managing budgets and risks in GP consortia. Thestudy of TPP found that it proved much easier to involve GPs in the single practice TPPs than in TPPs thatwere networks of practices. The consequences were that the latter found it more diYcult to keep expenditurewithin budget than the former; and single practice TPPs were no more likely to experience problems inmanaging the risks of rare costly referrals than TPPs of networks (Baxter et al, 2000). GP consortia are hencelikely to face challenges in involving GPs in budgetary control across their practices. This may prove to bemore diYcult than it was for multi-practice TPPs, as their practices had the experience of managing budgetsas GP fundholders, and they had opted to be part of the same TPP.

5. The funding of each GP consortium will be determined with reference to its estimated past expenditureand a target allocation, determined by a formula that takes account of estimates of the size of its population,its relative need and variations in unavoidable costs (such as from labour markets). Its estimated pastexpenditure and target allocation will be aggregates of estimates of each of these for its constituent practices.There will be large diVerences between these two estimates for some practices, with some targets implyingthe need for large reductions in expenditure. Although this process oVers potential to produce fairerallocations of resources than the haphazard outcomes of the past, at the level of the single practice, estimatesof both past expenditure and the target allocation will be subject to large errors. Hence consortia will needa way of making sense of these diVerences (Bevan, 1997).

6. Target allocations are based on average rates of treatment for estimated relative need. So one reasonfor diVerences between estimated past expenditure and a target allocation will be that rates of hospitaladmissions are higher or lower than the estimated average. A good way of assessing whether these variationsdo or do not reflect diVerences in need is to use information on Clinical Practice Variations (CPV)54 fromanalysis of small area variations in admission rates (as reported in the US by the Dartmouth Atlas).55 Ifhigher than expected volumes of admissions are concentrated in categories of admission that are known tobe high variation with high levels of inappropriateness (such as tonsillectomy and disc surgery), the causeis likely to be CPV, which suggests that volumes ought to be reduced to average levels. If, however, higherthan expected volumes of admissions are concentrated in categories of admission known to be low variationand with high levels of appropriateness (such as acute myocardial infarction and hip fractures), this suggeststhat the estimates of need are inadequate in capturing the high risk of this population, and the target is toolow (Bevan, 1997). Hence it would be helpful for GP consortia to have information on the nature of CPVin England and advice on how to use this information.

Integration of primary and secondary health care and organising new entrants into commissioning

7. Enthoven (1985) compared the NHS in the 1980s with two successful high-performing IntegratedInsurance and Delivery Systems (IIDSs) in the US: Group Health Cooperative of Puget Sound and theKaiser Permanente HMO. In doing so, he identified as a key weakness of the NHS that “it appears lockedforever into a model of separation between GPs and hospital-based specialists” who “communicate witheach other mostly by mail” (Enthoven 1985: 46–47). This separation was observed in studies of the NHS inthe 1960s (Stevens, 2003) and still strikes US visitors to-day. Enthoven argued that the NHS could benefitfrom being reorganised into IIDSs “in which primary care physicians are partners in regular contact withspecialists, sharing the same oYces, records and equipment”. The advantages of this included easy, quickand informal consultation in a collegial and collaborative atmosphere, with formal and informal learningand quality assurance by peer review, and a shared comprehensive medical record. Although Enthoven’spreferred reform was to transform the NHS into competing IIDSs, he deemed this to be not politicallyfeasible. So he advocated instead that each District Health Authority would become an IIDS with a localmonopoly for its defined population by employing GPs and hospital specialists, and be empowered to usecontestable markets for delivery in an “internal market” (ie contract out unsatisfactory services). Herecognised that, as these IIDSs would not compete, there would be a lack of economic incentives for themto improve the delivery of care.

54 CPV exists when diVerent doctors make diVerent decisions about the same or similar patients. The classic example is that ofadenoidectomy/tonsillectomy described in the 1930s as “a prophylactic ritual carried out for no particular reason with noparticular result” (Glover, 1938). Since then there has been a vast literature onCPV inGP referral rates and hospital admissionrates. (Although variations in demands by patients are likely also to contribute to these variations). Studies in the US(Wennberg et al, 1984) and in England (McPherson K et al 1996; Bevan et al, 2004) have found about 90% of hospitaladmissions were in a high variation category.

55 See: http://www.dartmouthatlas.org/



8. We now know that it proved virtually impossible the US, in the 1990s, to replicate the model of high-performing IIDSs. One symptom of the failure to do so was the backlash against “managed care”. Thelessons from the literature on the characteristics of high-performing IIDSs in the US identify obstacles todeveloping these in England (Bevan and Janus, in press).

(a) High-performing IIDSs are organised as vertically integrated systems that provide the consumerwith health care services across the whole continuum of care. This runs counter to the historicdivision in British medicine (Honigsbaum, 1979) and the organising NHS principle of thepurchaser/provider split.

(b) High-performing IIDSs design systems of reimbursement so that whatever is financially adversefor one of the components carries over to the organisation as a whole. This does not apply to theNHS because of the purchaser/provider split: with GP consortia funded with reference to a formula(based on the needs of their population) and paying providers according to the volume andcomplexity of care they supply.

(c) High-performing IIDSs’ commitment to cost control and high quality care follows from the needto signal high quality care to attract staV and enrollees from competitors. As GP consortia do notcompete, they will not face such pressures.

(d) High-performing IIDSs have sophisticated management and information systems, which theNHS lacks.

(e) High-performing IIDSs have been stable over decades and are large enough to provide integratedcare across a broad range of services. In contrast the NHS has been subjected to fundamentalreorganisations of commissioning bodies every few years since 1991 and it is not yet clear if GPconsortia would be large enough to be a high-performing IIDS.

9. Developments in which GP consortia develop integrated care with hospital specialists are welcome.But the US experience shows that simply putting them in the same organisation does not of itself result inhigh performing IIDSs. Indeed some may turn out to be dysfunctional local monopolies. Hence, whilst thepath of integration is worthy of exploration, it seems vital to allow choice of commissioner as part of suchdevelopments.

10. Patients are more likely to choose their GP as a provider of primary care than on the commissioningeVectiveness of the GP’s consortium. It would be possible to design a contestable market for commissioning,in which individuals have an explicit contract for an insurance package with their commissioner (as in theNetherlands) and to open up this market to new entrants: such as private insurers, or NHS FoundationTrusts oVering integrated services (Bevan and van de Ven, 2010). Monitor, as the new proposed economicregulator, could be made responsible for developing a contestable market for commissioning, regulatingmarket entry or changes to insurance coverage based on two requirements: demonstration of keycompetences in commissioning; and definition of catchment areas for which they could guarantee a duty ofcare (to commission or deliver all necessary care). Over time, commissioners could be free to negotiate withproviders, could develop into IIDSs, could restrict patient choice of provider on grounds of quality, andreplace rationing by Ministers with individuals choosing between diVerent insurance packages oVeringdiVerent benefits.

Engaging GPs, patients and the public in making hard choices in commissioning

11. GP consortia will have to make hard choices in commissioning. The Systems Modelling forPerformance Optimisation and Service Equity (SyMPOSE) research programme at LSE has developed asocio-technical approach that would enable them to do so, in a five-year research programme funded by theHealth Foundation. This approach develops a requisite model (Phillips, 1984) that can generate informationon costs and benefits so that this can be used systematically by key stakeholders (patients, carers and staVproviding social and clinical services) make hard choices that take account of impacts on resources,population health benefit and inequalities in health. We have collaborated with Primary Care Trusts in theIsle of Wight and SheYeld and worked with their key stakeholders to examine options and make strategicdecisions. This research has developed a visual geometry which makes transparent three key concepts forstakeholders (see Appendix 1):

(f) Rectangles of population health gain (with numbers who benefit and the degree of benefit for atypical individual).

(g) Value for Money (VfM) triangles (with value, costs, and VfM), where value includes populationhealth gain and can incorporate other criteria (such as reducing inequalities in health and theprobability of success of the implementation of proposed changes).

(h) An eYciency frontier developed by ordering interventions in terms of VfM.

12. Our approach requires stakeholders to focus remorselessly on ensuring that they have all the data theyneed to make decisions and to appreciate that it is much better to have approximate estimates than none.Through a series of working meetings led by an impartial facilitators (Decision Conferencing: see Phillips,2007) stakeholders were able to estimate the relative health gains of a typical individual from a series ofinterventions for mental health, cancers, dental health, cerebrovascular disease, cancers, respiratory disease



(and long term conditions), and children. In this way they were able to generate rectangles of populationhealth gain and set priorities within and across disease areas using VfM triangles that took account of: NHScosts and various assessments of value.

13. This approach was first developed in collaboration with the Isle of Wight PCT in 2008 to agree astrategy for spending £1m of growth money (Health Foundation, 2009). It was further developed withSheYeld PCT in 2009 to examine scope for reallocating resources along care pathways for the treatment ofeating disorders, the prevention and treatment of three cancers (breast, colorectal and lung) and dental care.The analysis of the care pathway for the treatment of eating disorders informed a new strategy to re-allocateresources to early interventions. This appears to have reduced the need for intensive care for those who areseriously ill and is likely to produce more population health gain at reduced total costs. The analysis of thecurrent system of fees paid to dental practices for their Units of Dental Activity showed that this was notdesigned to create incentives for them to provider good VfM and we explored how that system could beredesigned to do so.

14. Hence the SyMPOSE research programme has developed new ways or organising the collection ofdata and the presentation of information designed for deciding on the few changes that can releasesubstantial eYciency savings and gains in value. This approach is of wide generalisibility: it can inform thoseresponsible for national and local policies, including the design of systems of reimbursement to providersto generate VfM. Furthermore this approach is designed so that to enable a method of analysis to whichclinicians, patients and the public can contribute to the analyses and understand the results. This will beincreasingly important for the hard choices that the NHS now faces.

November 2010

References

Baxter K et al. (2000) Primary care groups: Trade-oVs in managing budgets and risks. Public Money andManagement, 20(1): 53–62.

Bevan G. (1997) Resource Allocation within Health Authorities: Lessons from Total Purchasing Pilots.London: King’s Fund Publishing.

Bevan G, Janus K. Why hasn’t integrated healthcare developed widely in the US and not at all in England?Journal of Health Politics, Policy and Law (in press).

Bevan G, van de Ven WPMM. (2010) Choice of providers and Mutual Healthcare Purchasers: can theEnglish NHS learn from the Dutch reforms? Health Economics, Policy and Law, 5(S3): 343–363.

Bevan G et al. (2004) Using information on variation in rates of supply to question professional discretionin public services. Financial Accountability and Management, 20(1): 1–17.

Enthoven A. (1985) Reflections on the management of the NHS. London: NuYeld Provincial Hospitals Trust.

Glover A J. (1938) The Incidence of Tonsillectomy in Schoolchildren, Proceedings of the Royal Society ofMedicine, 31: 1219–36.

Health Foundation (2009) Improvement in practice: Commissioning with the community. London: HealthFoundation.

Honigsbaum F. (1979) The Division in British Medicine. London: Kogan Page.

McPherson K et al. (1996) Systematic Variation in Surgical Procedures and Hospital Admission Rates.London, School of Hygiene and Tropical Medicine).

Mays N et al. (eds) (2001) The Purchasing of health care by primary care organisations. An evaluation andguide to future policy, Buckingham: Open University Press.

Phillips L D. (2007). Decision Conferencing. Chapter 19 in W. Edwards et al. (Eds) Advances in DecisionAnalysis. From Foundations to Applications. New York: Cambridge University Press; p375–99.

Phillips L D. (1984). A theory of requisite decision models. Acta Psychologica 56: 29–48.

Stevens R. (2003) Medical practice in modern England. Yale University Press.

Wennberg J E et al. (1984) Will Payment Based on Diagnosis-Related Groups Control Hospital Costs? NewEngland Journal of Medicine 311: 295–300.

APPENDIX 1

THE SyMPOSE APPROACH TO VALUE FOR MONEY

1. The SyMPOSE approach generates a series of four estimates.

(a) Quantitative estimates of the population health gain for each policy option:

(i) the numbers who are likely to benefit;

(ii) the typical individual who is likely to benefit;

(iii) a standardised health gain score between 100 (for the best) & zero (for no benefit).



(b) The total population health gain for each policy option as the product of the numbers who arelikely to benefit and its health gain score.

(c) The development of a Value for Money (VfM) triangle for each policy option, with:

(i) health benefit score as the vertical line which can combine multiple criteria (population healthgain; reduction in inequality; and the ease or diYculty of successful implementation);

(ii) cost as the horizontal line; and

(iii) VfM as the slope.

(d) The ranking of policy options to develop an eYciency frontier in terms of VFM (or scale ofhealth benefit).

2. Table 1 illustrates the way estimates for quantitative estimates of the population health gain for threepolicy options in treatment and prevention of cancers were derived in the Isle of Wight (IoW) collaborationand Figure 1 illustrates the total population health gain for policy option (the product of the numbers whoare likely to benefit and its health gain score). Figure 2 illustrates the concept of the VfM triangle.

Table 1

ASSESSING HEALTH BENEFITS FOR POLICY OPTIONS

Initiative No Benefit “average” beneficiary Health gain score

Early detection & diagnosis 200 Femail, mid-60s, “hard to reach“ 100Palliative & End of life care 1,500 Late 70s, life limiting long term 75

health conditionall socio-economic groups

Relocate active treatment 300 Mid-60s, female, very sick 25

None of above

Early detect diagn

Palliative & EOL

Active Treatment

0

10

20

30

40

50

60

70

80

90

100

0 200 400 600 800 1000 1200 1400 1600

Aver

age

bene

fit p

er p

erso

n (a

ssum

ing

succ

ess)

Numbers who benefit

Figure 1: population health gain for each policy option



Figure 2: The VfM triangle

costsR

educedinequalities

Improved

health

Risk-adjusted benefits(compared to current care) taking account of doability

Value

-for-m

oney

3. Figure 3 shows the outcomes of applying this approach for eating disorders in SheYeld. The patternof care in 2009 was analysed as producing in total 50 units of estimated benefits at a total cost of £2.2 million;with 90% of the costs spent on a small number of patients who had become acutely ill and required costlyintensive care that produces only limited benefits for each patient. Stakeholders agreed to expand servicesat an early stage, when interventions are low cost and highly eVective, to reduce the need for costly intensivecare later. This strategy has potential to reduce total costs (to £1.4 million) and double the estimated benefits(to 100 units).

Figure 3: Analysis of treatment of eating disorders in Sheffield

More benefit

Lower budget

Written evidence from Dr Peter Weaving (COM 135)

Delivering Health Improvements

A stronger commissioning role for GPs holds the prospect of decisions being taken closer to patients, atighter control of budgets and greater clinical input into the design of services.

It nonetheless requires strong GP leadership to fulfil these ambitions. From April 2010, an increasingshare of NHS Cumbria’s annual £850 million health budget has been directly managed by six GP-led boardsrepresenting Allerdale, Furness, Carlisle, Copeland, Eden and South Lakeland.

These changes were introduced before the publication of the Health White Paper and are part of a journeyGPs in Cumbria have been on over the last four years. Hard budgets directly managed by GP-led localitiesinclude PBR, community services and prescribing.



Delivering Efficiencies

Greater clinical engagement in Cumbria has delivered tangible results for patients and taxpayers. The shiftin the delivery of health services from hospital to community has improved clinical outputs and bucked thenational trend in several important areas.

For example, emergency admissions to hospital in Cumbria have fallen by 6 per cent while increasing inmost other parts of the North West. New referrals to outpatient clinics are falling and the prescribing costsfor Cumbria are the lowest in the North West.

The greatest challenge to further improvement remains the inability of commissioners to ensure providersadhere to commissioning intentions. In particular, the perverse incentives of the PBR (Payment by Results)system drive activity rather than patient-focused and cost-eVective care.

Delivering Reforms on Time

The journey of reform which GPs in Cumbria have been on to reach their current position as mature andexperienced commissioners has taken several years. The PCT has played an important enabling role overthis period and has actively transferred powers to GP consortia.

The GP consortia are fully aware that they cannot and should not take on PCT administrative functions.The consortia in Cumbria are designing the level of business support needed following disbandment ofthe PCT.

Delivering Public Support for Change

GPs hold a special role within the NHS; accounting for 90% of all patient contacts. The GPs in lead andsupport roles in their consortia all hold ongoing clinical posts with patient contact. Reforms should buildupon this role and enable GPs to engage with local communities beyond the practice door in an on-goingpublic conversation about local health services, their provision and, more importantly, their development.

November 2010

Written evidence from NHS Partners Network (COM 136)

1. The NHS Partners Network (NHSPN) is grateful for the opportunity to give evidence to the HealthSelect Committee as part of the Committee’s inquiry into NHS Commissioning. As well as the commentsset out in this note, we have also contributed to the NHS Confederation’s main written submission to thisinquiry. We will be happy to provide the Select Committee with any further details if that would be helpful.

2. The NHSPN is the NHS Confederation’s network for independent sector healthcare providers of alltypes. Our commercial and not for profit members include hospital groups, specialist hospitals, dentistry,patient transport and primary and community care providers. We are committed to creating anenvironment, politically and with the public, where independent sector providers are able to become a fullyintegrated part of a mixed economy NHS. Full integration of independent sector providers will lead to morechoice and better value for money as well as contributing to the contestability and innovation that the NHSwill need in order to meet the diYcult financial challenges of the future. Underpinning the NHSPN’s positionis an absolute commitment to the core values of the NHS, combined with a passionate belief in the right ofpatients to be able to choose between real alternatives.

3. The NHSPN is strongly supportive of the policies set out in the coalition government’s health WhitePaper “Equity and Excellence: Liberating the NHS” and the subsequent consultation documents. Ourcomments are therefore intended to help ensure that implementation of these policies is as eVective andflawless as possible. The scale and scope of the proposed reforms is such that at this stage there are inevitablystill areas of uncertainty and potential diYculty. Our view is that with constructive engagement and goodwillthese can be clarified and resolved and that the end-point will be a better national health system for patientsand a more cost-eVective one for taxpayers.

4. It is however also important to keep in mind the scale of the independent sector’s involvement in NHSprovision. This is far smaller than is often implied (leaving aside, of course, the fact the GPs are themselvesprivate sector providers and account for almost all of mainstream primary care provision). The key facts are:

— The latest publicly available full-year figures show that the ISTC programme accounts for only1.8% of NHS elective surgery (Audit Commission, 2008, Is the treatment working? Progress withthe NHS system reform programme).

— Use of the extended choice network (”ECN”), though it has rapidly expanded, accounting for147,000 procedures based on the most recently available yearly figures still represents only arounda further 2.5% of total NHS elective care.



— While accurate data is not yet available, the independent sector share of the primary care marketis still probably less than 2%.

— Data just released by the DH shows that only 4% of community service contracts are to be put totender and thus subjected to market challenge in terms of value for money (which we define as theoptimum combination of quality and price that can be secured. (DH, Plans in place to transformCommunity Services, Press Release of 26/11/10).

5. With regard to the government’s proposed new commissioning regime, there are a number of key issueswe would invite the Select Committee to consider:

Recent History of Commissioning

6. While there is much criticism of the lack of progress made towards “world class commissioning”,NHSPN’s view is that some significant progress has been made by a number of PCTs. For independent sectorproviders, good quality, professional commissioning is vital, as is building and maintaining goodrelationships with commissioners. The best PCTs were starting to develop the market and the provider sideand were also starting to understand the sort of contractual relationships that brought stability and closerintegration as well as innovation and challenge. Some were also starting to encourage the role of theindependent and third sectors in bringing important innovation to the way healthcare is delivered. Despitethe relatively small scale of independent sector involvement to date, there are a growing number of casestudies of innovation in, for example, elective care and community services that show how quality can beimproved while costs are reduced. Under the proposed reforms there is a significant risk that thedevelopment of “best practice” commissioning and the encouragement of vital innovation could be lost. Itwill then take considerable time for this momentum to be rebuilt.

Multiple Commissioning Relationships

7. It is a characteristic of many independent sector providers that they are national or regional companiesable, and wanting to work with a number—sometimes many—PCTs. In this respect independent sectorproviders diVer from the majority of public sector providers. Even the existing arrangements have the eVectof requiring multiple commissioning and contracting relationships with diVerent PCTs and the developmentof standard contracts has not been as eVective at addressing this problem as was hoped. With the imminenttermination of the Extended Choice Network contracts and the possible creation of between 300 and 500GP commissioning consortia, the independent sector is viewing with considerable concern the potential fora significant increase in contracting costs and unproductive variations in contracting terms. This is alreadybecoming an issue during the “transitional phase” but must be addressed fully as part of the implementationof the new commissioning regime. It will be vital to have central accreditation and consistent implementationof the Any Willing Provider policy at local level. Otherwise the new regime will have created further barriersto entry and transaction costs will be a serious constraint.

Scale

8. The scale of GP commissioning consortia is a concern because the experience of independent sectorproviders is that many services need to be commissioned and to operate across significant geographic areas.It is not yet clear to us how relatively small consortia will address this problem or what arrangements will,given time, emerge to allow them to do so. Nor is it clear how much time that will take, or whether it isprudent, from both patients and taxpayers perspectives, to wait for it to happen of its own accord.

Procurement

9. The biggest challenge facing the NHS for the next decade will be the increasing shortage of funds andas a result the vital need to secure maximum value for money. The rigorous, non-discriminatory applicationof government procurement principles (and procurement law) is therefore of the utmost importance. Whilethe government’s intention is clearly that the principles of public procurement will apply to the GP consortia,the NHSPN is concerned that the consortia will lack the necessary skills and knowledge. The risk of this ishighlighted by the way the representatives of GPs have spoken openly of their wish to discriminate in favourof public sector providers. This “preferred provider” approach was successfully challenged by NHSPN andACEVO in the closing months of the last government. The resurrection of the approach at local level willbe potentially damaging to the interests of taxpayers by undermining patient choice and opportunities tosecure value-for-money.

NHS Commissioning Board

10. Relatively little attention has thus far been paid to the role of the NHS Commissioning Board. TheBoard will still retain responsibility for large swathes of commissioning, notably most primary care includingall of dentistry. While recognising that further clarification of these arrangements is no doubt in the pipeline,



NHSPN is still unclear as to how a Board working at national level will be able to ensure that it is fullyinformed as to local needs and conditions. NHSPN is also concerned that the Board will be responsible forthe structure of tariV whilst the new economic regulator, Monitor, will be responsible for price setting. Inour view the two are so tightly linked that both roles should sit with Monitor.

December 2010

Written evidence from Mind (COM 137)

About Mind

Mind is the leading mental health charity in England and Wales. We work to create a better life foreveryone with experience of mental distress by campaigning for people’s rights, challenging poor practiceand informing and supporting thousands of people on a daily basis. A fundamental part of Mind’s work isprovided though our network of over 180 local Mind associations who last year worked with over 220,000people running around 1,600 services locally. Services on oVer include supported housing, crisis helplines,drop-in centres, counselling, befriending, advocacy, and employment and training schemes.

Introduction

Mind welcomes the opportunity to provide evidence to the Health Select Committee on the move to GPCommissioning. Mind’s response to this inquiry is underpinned by a single principle: that these reforms donot result in any disruption to people’s access to health services and, ultimately, result in improvements totheir quality, availability and the outcomes that they deliver.

Mind believes the Government must address three key areas to ensure that mental health services are notadversely aVected by changes to commissioning: GPs’ competence and confidence in mental healthcommissioning; improving pathways to recovery; and vulnerable groups and people with a limited voice.

Competence and Confidence in Mental Health Commissioning

1. We recognise that PCTs have not always commissioned mental health services well, although there aresigns that things are improving. It is imperative that the progress that has been made is embedded withinany new system and that any new system ensures further improvements in both quantity and quality ofcommissioning. This will ensure that those with mental health problems have access to the care and supportthat they require.

2. The shift to GP-led commissioning is an opportunity to improve the commissioning of mental healthservices. However, anecdotal evidence from service users indicates that many GPs do not have suYcientunderstanding even of mental health in primary care, and may not be best placed to commission secondarycare. Recent findings from the charity Rethink56 indicate that GPs themselves do not yet feel confident totake on commissioning and commissioning for mental health in particular. This knowledge gap needs to befilled before GP consortia take on commissioning. If GPs’ understanding of mental health services is notaddressed, mental health service provision will not improve. Consortia that do not fully understand thebreadth and range of mental health treatments and services may well fail to commission the right services.

3. It is imperative that GPs are supported in commissioning mental health services. Whilst this supportwill come primarily from the NHS Commissioning Board, it is important that expertise within PCTs is alsoutilised and not lost.

4. The expertise of those involved in the delivery of services—eg psychiatrists, social care professionals,nurses and occupational therapists—should be utilised, as should the expertise of the third sector and, mostimportantly, mental health service user groups and individual service users themselves.

5. It is important that NHS, social care, and public health strategies are fully integrated. We hope thatat a local level, mental health commissioning decisions will not be taken in isolation from public health andsocial care decisions. This coherent approach will deliver both greater eYciencies and a more eVective seriesof interventions.

6. All commissioning decisions should undergo a thorough impact assessment to ensure that particulargroups within a locality are not adversely aVected. Robust evaluation will assess a GP consortium’sperformance in delivering on key outcomes, such as recovery and patient experience with be needed.However, the information gathered and evaluated must be consistent across the country so that theperformance of diVerent consortia can be accurately assessed. This will highlight cases of good and badpractice, and enable patients to make informed choices.

56 http://www.rethink.org/how we can help/news and media/press releases/white paper to hand.html



Improving Pathways to Recovery

7. People with mental health problems often rely on a range of services across health, social care andpublic health services. It is vital that the commissioning process allows for joined up, coherent care packagesto be put in place without the individual having to undergo repeated assessments.

8. Recently service providers have improved their ability to collaborate, delivering full packages ofservices for PCT commissioners. These packages will often cross boundaries between the statutory, privateand voluntary sectors. Collaborative approaches place the patient at the centre and lead to a much betterpatient experience and faster recovery. However Mind is concerned that this approach may be judged anti-competitive by the new economic regulator, Monitor.

9. It is vital that a service user’s journey along the care pathway is smooth. However, as the market opensup, this will increase the numbers of individual providers. If an individual patient has to access a greaternumber of specialised providers, his/her journey may become more complicated and potentially morestressful. The White Paper’s emphasis on choice is welcomed, but could exacerbate this complexity.

10. A potential solution could be an expansion of the use of navigators and advocates, as currentlyprovided by some services. These are designed to support people in accessing a range of services andtravelling along their care pathway.

11. Mind is also aware that in many cases services are better provided closer to the individual’scommunity, and so potentially as an extension to primary care. We are not clear how GP consortia wouldbe able to commission such services or whether these would need to be centrally commissioned.

Vulnerable Groups and People with a Limited Voice

12. The White Paper indicates that transparency will be the main mechanism for ensuring consistentlyhigh quality services across the country. This approach relies on patients being able to access, understandand analyse information before making a decision about the services they need. However people with mentalhealth problems, when they are unwell, are often less able than other groups to access and analyseinformation. Furthermore, many mental health service users are not in a position to travel and cannotsimply transfer to another provider if they experience a poor service.

13. Stigma and discrimination is a significant problem for mental health. It is not well understood by thepublic, and therefore fails to generate much public sympathy. GPs groups have already expressed a fear thatthey will be subjected to doorstep lobbying, and pressured into commissioning those services that enjoy themost vocal and widespread public support. Mind is concerned that mental health will lose out in the battlefor resources.

14. The role of local HealthWatches will become crucial. They must ensure that the experience of allpatients from all backgrounds are heard and fed into the commissioning process. In particular, they mustensure that the voices of the least vocal and most disadvantaged members of a community are activelysought out and communicated. A failure to do so could well result in a decline in the availability of mentalhealth services.

15. Mind is concerned about the lack of a formal complaints procedure for dealing with problems thatarise from the commissioning process. While complaints regarding the quality of a service can becommunicated to a local HealthWatch, and escalated to the Care Quality Commission, no such processexists for complaints about the commissioning process. This is a concern, particularly if commissioningdecisions seriously fail to consider the interests of a vulnerable group, such as those with mental healthproblems. Mind would like to see the establishment of a formal complaints procedure by which seriouscomplaints can be dealt with by the NHS Commissioning Board.

December 2010

Written evidence from National Voices (COM 139)

Summary

1. Commissioning is about securing health and well being outcomes. It needs to be multi-disciplinary, tofocus on care pathways and to cross the boundaries of health, social care and public health. It needs to fullyinvolve patients and citizens.

2. National Voices advocates a unified health and well being outcomes framework, as a driver ofintegrated working.

3. Commissioning has yet to mature in England. The Government’s proposed reforms provide anopportunity to make commissioning more holistic and responsive to patient needs. They also present risks,in particular the risks of fragmentation and loss of existing expertise.

4. We welcome the opportunity to open health and social care to new commissioning models, in whichthere is a big potential role for the voluntary sector.



5. General practitioners are well-placed to take a pivotal role in commissioning. But the interests of GPsand patients are not identical.

6. There must be patient and lay participation in the governance of consortia on terms of equality.Commissioning decisions need to involve patients and local communities, including HealthWatch, andreflect patient and service user experience. Patient and lay involvement need to be backed by statute.

7. Hard choices will be inevitable to maintain an eVective health service in conditions of austerity. It isnot clear that the White Paper posits suYciently robust mechanisms for making these choices. It is importantthat patients and citizens are not left out in the cold as these decisions are taken. They need to be partnersin the decisions, for example on the reconfiguration of services.

8. There needs to be an explicit focus in the remit of the National Commissioning Board on the needs ofpatients and service users who are vulnerable by virtue of their health condition or demographiccharacteristics.

Introduction

9. National Voices welcomes the opportunity to submit evidence to the Health Select Committee inquiryon commissioning. We are the coalition of national voluntary organisations with a mission to strengthen thevoice of patients and citizens at all levels in health and social care. This submission represents the collectiveviews of National Voices members, and is consistent with our response to the Government’s consultationson its NHS White Paper “Equity and Excellence”.

10. We have structured our submission as follows:

(a) A general observations section and (b) specific responses to the questions set out in theCommittee’s terms of reference.

General Observations

Context

11. There has been considerable progress in the last decade in improving health and care in England, butmore needs to be done. We need a service that is equipped to cope with growing demand, to ensure greaterconsistency of quality and to make care more tailored to the diverse needs of individuals and communities.

12. We know that there are large variations in quality, that death rates for several cancers lag those inother advanced countries, and that health inequalities have remained wide and, in the case of the lifeexpectancy gap between rich and poor, have widened. The care of people with long term conditions, to whichthe majority of NHS resources are devoted, does not systematically follow good practice. More needs to bedone to take unnecessary activity out of hospital settings and to provide people with the support andinformation they need to be in control of their health and their conditions and be fully involved in decisionsabout their care. The provision of adult social care is patchy and inequitable. The health and social caresystems are often diYcult and confusing to navigate. There is frequently poor coordination across theboundaries between NHS and local authority services and between primary, community and secondary care.

13. More needs to be done to ensure that patient and citizen voices become powerful drivers of changein the NHS.

14. We know from our members that care systems struggle to respond eVectively to the needs of particularpeople and groups, for example: frail elderly people; people with mental health conditions, learningdisabilities and physical disabilities; some minority groups; chronically excluded groups, such as homelesspeople, sex workers, and asylum seekers; and people with rare conditions or with those which the NHS doesnot generally prioritise, such as musculo-skeletal conditions. Even for the most articulate and health-literate,the experience of care can sometimes be disempowering, frightening and lacking in respect and compassion.

15. National Voices members are therefore not complacent about the status quo, which can be seenamong other things to reflect a continued immaturity in the state of commissioning. Commissioning stillmanifests itself too much as a series of incrementally evolving buying decisions, and not enough as thestrategic design of care pathways which ensure that services are joined up, and that, for example, self-supported patients with long term conditions have a better and cheaper option than A&E when they areunwell.

16. We believe that the Government’s proposed reforms oVer an opportunity to rethink the way healthand social care are delivered in England and to make significant improvements. In particular, we stronglysupport the emphasis on quality and outcomes, and on empowering patients and citizens. We welcome thecommitment to build on the work of Lord Darzi on quality and to maintain the NHS Constitution. Weapplaud the vision of an NHS built around the principles of shared decision making, including betterinformation and choice, and of “no decision about me without me”. We believe that general practicecommissioning, if carefully introduced and supported, has the potential to make the design of local servicesmore responsive to need. We welcome the proposed new role for local authorities in promoting integratedcommissioning across health and social care and in public health.



17. Our members have also highlighted risks associated with implementing the Government’s reforms.A number of major changes are happening in parallel:

— an NHS change programme of unprecedented scale and pace, which is already underway;

— an eYciency programme designed to release up to £20 billion of savings for reinvestment withinthe NHS;

— the drive to achieve significant savings in the NHS management overhead; and

— cuts to benefits, local authority services and support to the voluntary sector, a set out in thecomprehensive spending review.

18. In combination these factors risk undermining the intent of the NHS White Paper through:

— professionals losing focus on safety, clinical eVectiveness and the experience for patients;

— a loss of skills and expertise, especially in commissioning;

— disruption of models of care that are working well;

— short termist cuts in service provision with long lasting consequences; and

— a widening of health inequalities and harm to the health and wellbeing of poor and marginalizedcommunities.

Commissioning

19. The new commissioning arrangements need to respond eVectively to diverse needs at local, regionaland national level. In the transition to the new arrangements it will be vital to guard against the risk offragmentation and growing inequity as between consortia areas, and the unwitting loss of services and goodpractice. The leadership role of the emerging NHS Commissioning Board will be of vital importance, inparticular to guide the development of services at geographical levels beyond that of individual consortia.Patient, service-user, carer and community organizations need to be closely involved in supporting thetransitional arrangements.

20. Commissioning consortia will need skills and infrastructure to support their work. GPs are wellplaced to understand the needs of their patients, but also need to understand the diverse needs of theirpopulations, not all of which are manifest in the consulting room. GPs’ interests are not identical to thoseof patients and communities and GPs are not proxies for patients. General practice commissioning will needto draw on the expertise provided by a range of health and social care professionals and on the expertiseabout particular conditions that lies with patient organizations and with patients themselves.

21. GP consortia will be publicly funded and accountable bodies. They need to feel very firmlyaccountable to local communities. Consistent with the Government’s commitment to shared decisionmaking and meaningful public involvement, we consider it vital that there is equal lay participation in thegovernance of consortia, and that their meetings are held in public. They need to involve local communitiesin their work. A significant lay involvement is also needed in the governance of the NHS CommissioningBoard.

Responses to the Committee’s Questions

Clinical engagement in commissioning

— How will commissioners access the information and clinical expertise required to make highquality decisions about the shape of clinical services?

— How will commissioners address issues of clinical practice variation?

— How will GPs engage with their colleagues within a consortium and how will consortia engage withthe wider clinical community?

22. We support a multi-disciplinary approach to commissioning which makes full use of comparativedata on clinical outcomes, patient reported outcomes and patient experience. It is vital that existing skills,for example those lying within specialist heart, stroke and cancer networks, are not lost as the PCTs andSHAs wind up.

How open will the system be to new entrants?

— Will care providers be free to oVer new solutions which oVer higher clinical quality, better patientexperience or better value?

— Will commissioners be free to access new commissioning expertise?

— Will potential new entrants be free to oVer alternative commissioning models?

— What arrangements will be made to encourage the Third Sector both as commissioners andproviders?



23. We support a system which is open to new entrants and which can make full use of alternativecommissioning models, including those which involve voluntary sector organizations as commissioners andproviders.

24. It is important in the interests of accountability that there is maximum transparency about thearrangements for supporting commissioning in each consortium area.

25. We envisage the risk of support for commissioning becoming dominated by a small number of largeorganizations, in which case a level playing field for competition will not apply.

Accountability for commissioning decisions

— How will patients make their voice heard or their choice eVective?

— What will be the role of the NHS Commissioning Board?

— What legal framework will be required to underpin commissioning consortia?

— How will commissioning interface with the Public Health Service?

— How will commissioning interface with Health Watch?

— Where will the “buck stop” when commissioners face hard choices?

26. We support patient and lay participation in the governance of consortia on terms of equality, alongthe lines demonstrated by the practice based commissioning consortium Principia in Nottinghamshire.

27. Commissioning decisions need to involve patients and local communities and reflect patient andservice user experience. We think Experience Led Commissioning57 is a good example of an approach whichseeks to achieve this.

28. We support a legal duty on consortia to involve patients and local communities in commissioningdecisions. This needs to be supported by guidance from the NHS Commissioning Board. The aspirationshould be co-design of services, achieved through meaningful involvement of local people, and including astrong role for local HealthWatch. Current practice in the realm of patient and public involvement oftenremains too tokenistic and formulaic.

29. We should be commissioning for health and quality of life, not illness. Commissioning needs topromote a strong connection between health, social care and public health and there is an important rolehere for the new health and well being boards.

30. We believe that local accountability is better served by maintaining the separate scrutiny functions ofthe health Overview and Scrutiny Committees.

31. Hard choices will be inevitable to maintain an eVective health service in conditions of austerity. It isnot clear that the White Paper posits suYciently robust mechanisms for making these choices. It is importantthat patients and citizens are not left out in the cold as these decisions are taken. They need to be partnersin the decisions.

Integration of health and social care

— How will any new structures promote the integration of health and social care?

— What arrangements are proposed for shared health and social care budgets?

32. Analysis by the Audit Commission, NuYeld Trust, Integrated Care Network and Turning Point hassuggested that joint working is most eVective when focused, not on administrative structures and the processof joining up (sharing management, pooling budgets, etc) but on the outcomes for patients and service users.

33. National Voices advocates a unified health and well being outcomes framework, as a driver ofintegrated working.

34. The executive role of health and well being boards, and the accountability provided by OSCs andHealthWatch will be important.

35. It is important that the new reforms do not undermine instances of joint working (eg Care Trusts)which are working well now.

57 http://www.networks.nhs.uk/nhs-networks/healthcare-professionals-commissioning-network/documents/section-useful-resources/Putting%20people%20at%20the%20centre%20of%20GP%20commissioning%20ELC%20report%20161110.pdf



What will be the role of local authorities in public health and commissioning decisions?

How will the new arrangements strengthen commissioners against provider interests?

36. A disaggregation of commissioning arrangements, alongside the proposed increase in powers andfreedoms for providers, creates the risk of weakening, rather than strengthening commissioners againstprovider interests.


— How will the proposed system facilitate service reconfiguration?

— Will the new arrangements safeguard current examples of good practice?

— Who will drive innovation during the transitional period?

— How will transitional costs (redundancy etc) be minimized?

37. There needs to be an explicit focus in the remit of the National Commissioning Board on the needsof patients and service users who are vulnerable by virtue of their health condition or demographiccharacteristics.

38. Service reconfiguration will be diYcult to achieve without an approach will allows decision makingat the right geographical level (such as the recent work to reconfigure acute stroke services in London) andwhich involves patients and citizens in an honest and meaningful way.

39. There is an opportunity to drive innovation through a “pathfinder” process that encourages,publicises and carefully evaluates a diversity of approaches.

Resource Allocation

— How will resources be allocated between commissioners?

— What arrangements are proposed for risk sharing between commissioners?

— What arrangements will be made to safeguard patient care if a commissioner gets into diYculty?

40. National Voices favours maximum clarity and transparency about the arrangements that will pertain.

Specialist Services

— What arrangements are proposed for commissioning of specialist services?

— How will these arrangements interface with the rest of the system?

41. National specialist commissioning arrangements need to continue.

December 2010

Supplementary written evidence from the Primary Care Trust Network (COM 141)

PCT PAST AND CURRENT PERFORMANCEADDITIONAL INFORMATION FROM THE PRIMARY CARE

TRUST NETWORK, JANUARY 2011

1. Introduction

1.1 As you will be aware, the NHS Confederation has submitted written and oral evidence to theCommittee on its inquiry into commissioning. During the course of the inquiry Primary Care Trusts’ (PCTs)past and current performance was discussed by a number of witnesses. In particular, some members andwitnesses have suggested that PCTs are currently in “meltdown”.

1.2 In light of this we felt it would be helpful for the NHS Confederation’s PCT Network to set out belowsome of the evidence on past PCT performance, our analysis of how PCTs are currently performing, andwhat changes to Government policy may be necessary to help PCTs manage the combined eYciency savingsand organisational transition challenges they are currently faced with. This is intended to supplement theNHS Confederation’s original evidence which focused on the Government’s proposed reforms tocommissioning in the NHS in England.

1.3 The PCT Network was established as part of the NHS Confederation to provide a distinct voice forPCTs. 91% of existing PCTs are members of the Network.



2. Past PCT Performance

2.1 During oral evidence sessions of the Committee’s commissioning inquiry, a number of witnessesnoted the progress PCTs had made and highlighted the need to ensure good PCT managers transfer over tothe new system.

2.2 However, some commentators inside and outside of Committee sessions have criticised theperformance of PCTs and suggested that they have failed as commissioning organisations. Often thesecomments do not match the weight of evidence that demonstrates PCTs made good progress ascommissioning organisations.

2.3 There has of course been variation in performance between individual PCTs, and all PCTs wouldacknowledge that there is scope for further improvement of their commissioning activities as evidence ofeVectiveness improves and best practice evolves. However, we believe that some generic comments aboutPCTs’ collective failure may be based on outdated evidence that ignores the significant progress in recentyears. Criticism of PCTs is also sometimes based on dissatisfaction with particular decisions and actions thatthey have taken as commissioners. Commissioning decisions are not always popular with all parties aVectedor involved, but this is inevitable given the diYcult trade-oVs that all health service commissioners arerequired to take, and is not in itself an indication of failure or poor performance.

2.4 Objective analysis of the overall performance of PCTs across the country demonstrates realachievements in delivering improved health outcomes, as well as improvements in commissioning capabilityand financial performance.

2.5 These positive achievements have been enabled, in part, by a period of relative stability in structureand remit since October 2006 (following numerous changes to the role and configuration of commissioningbodies) and for the first time a serious attempt to prioritise and support commissioning through introductionof the World Class Commissioning programme and related changes to NHS policy and system management.

Outcomes

2.6 The Department of Health’s recent paper on the NHS Outcomes Framework for 2011–12 shows thesignificant improvements achieved over the last few years on the key targets PCTs have been asked toprioritise, including:

— Mortality rates.

— Life expectancy.

— Cancer survival rates.

— Infant mortality.

— Healthcare associated infections.

PCTs have also overseen significant reductions in waiting times and public satisfaction with the NHS hasrisen in recent years.

2.7 While it is diYcult to distinguish PCT contributions to these achievements as opposed to provider,SHA and regulator contributions, these were the priorities PCTs were asked to deliver and they have beenalmost uniformly achieved.

Commissioning Capability

2.8 There is also objective evidence demonstrating improvement in the commissioning capability ofPCTs. This is in spite of a number of reorganisations that took place to the commissioning side of the NHSunder the previous Government. This evidence includes:

— World Class Commissioning Results: The 2010 World Class Commissioning58 results showed thatPCTs improved on all 30 of the individual tests of commissioning competency that they wereassessed on this year and last year, with an average 42% increase in scores compared with 2009.

— PCT priority setting benefits local outcomes: A key characteristic of eVective commissioning is theability to identify health improvement priorities amenable to local intervention, take appropriateaction to address them, and as a result deliver more rapid improvement in the prioritised outcomesthan would have been achieved without intervention. A recent report by Health Mandate59

provides evidence that PCTs have been eVective in prioritising, focussing on and then deliveringimprovements in rates of smoking cessation, breast screening, Clostridium diYcile infections andchildhood obesity, and in improving end of life care. It finds early signs that where commissionershave prioritised these issues they have achieved a faster improvement in outcomes and are moresuccessful in controlling expenditure.

58 The World Class Commissioning results were not published nationally by the Department of Health. However, the HealthService Journal collated local results and published them online here:ttp://www.hsj.co.uk/topics/world-class-commissioning-scores-2010/

59 Health Mandate (2010) Commissioning in the new world: An analysis of the impact of prioritisation on quality, expenditureand outcomes in the health service.



Financial Management

2.9 PCTs have achieved significant financial improvement in recent years. In 2005–06, 35% of PCTs werein deficit with a gross deficit of £616 million and a net deficit of £492 million. By 2009–10 only 3% of PCTswere in deficit with a gross deficit of £39 million and a net surplus of £1,274 million.

2.10 The Audit Commission’s Use of Resources scores for 2009–10 also show a significant improvementin PCT performance with 96% of PCTs at or above minimum requirements for managing finances. Theproportion of PCTs performing above minimum requirements rose to 75% in 2009–10 from 53% in 2008–09.The report also concluded that in each SHA the majority of PCTs are “performing well”.

3. Current PCT Performance and Risks during Transition

3.1 During the course of the Committee’s inquiry on commissioning, some witnesses questioned PCTs’present performance as they deal with the transition and eYciency savings at the same time as reducing theirmanagement costs. It was suggested that PCTs are in “meltdown”.

3.2 PCTs have continued to perform well despite the challenges arising from the announcement in theWhite Paper of their abolition from April 2013. While the PCT Network has warned, along with othercommentators, of the risks during the period of transition to the new commissioning arrangements set outin the White Paper, it is wrong to suggest the system is currently in meltdown.

3.3 The most recent financial data reported that the returns for the second quarter of the financial year2010–11 show that SHAs and PCTs are forecasting an overall surplus of £1,286 million (£1,345 millionsurplus at Q1), which is 1.3% of total revenue resources. Four PCTs (out of 151) are forecasting deficits, butthese are the exceptions.60

3.4 The fact that PCTs have succeeded in maintaining their core commissioning activities, and have alsobeen able to progress complex plans to transfer their community services to other organisations whilstensuring the provision of these services61 is maintained during this period of change, is testament to theeVorts of PCT staV and managers to ensure the stability of the NHS. This has been achieved despite thesignificant reductions in PCT capacity currently being implemented.

3.5 We support the action recently proposed by the Government in the Operating Framework to helpmanage the transition risks. It is very important that PCTs retain a grip on performance over the nexttwo years.

3.6 The proposals to “cluster” PCTs to retain critical mass are sensible, as long as these decisions arebased on a proper analysis of local issues rather than being imposed from above.

3.7 Similarly we entirely support the recognition in December’s command paper of “the many excellentstaV currently working in PCTs”62 and the expectation that significant numbers of them will find roleswithin the new commissioning organisations. Retaining skilled staV is absolutely essential to the successfulimplementation of the reform to commissioning set out by the Government.

4. Conclusion

4.1 It is important to take a realistic and balanced view of the achievements of PCTs if we are to learnlessons for the future. While we certainly would not claim that all PCTs have been successful or that PCTshave achieved everything that was hoped from them, we believe the concrete evidence of the progress madeby PCTs should be acknowledged so that future commissioning organisations and policy-makers learn fromgood past practices and retain skilled staV.

David StoutDirector, PCT Network

January 2011

Supplementary written evidence from Age UK (COM 142)

1. Introduction

Age UK was pleased to be invited to speak to the Committee on the future of NHS commissioning andbe able to describe some of the serious problems that must be addressed to enable the NHS to deliverappropriate, high-quality healthcare services to people in later life.

60 Department of Health (2010) The Quarter, 2010–11 quarter 2.61 PCTs directly provide the vast majority of out of hospital/community-based NHS services but are required to fully separate

their commissioning and provider functions by April 2011.62 Department of Health (2010) Liberating the NHS: legislative framework and next steps, p 56 (4.26).



The NHS clearly faces extreme challenges with; a huge programme of structural reform alongside theunprecedented goal of 4% annual eYciency gains. Given the scale of the productivity savings required andthe context in which they will have to achieved, the “Nicolson challenge” set out by the Committee is nosmall undertaking.

Further to Andrew Harrop’s oral evidence to the Committee on 7 December 2010, Age UK would liketo take this opportunity to set out what we believe to be the scale of these challenges in relation to the careof older people, and provide more detailed insight into the views of older people regarding proposed NHSreforms. The information regarding older people’s views is derived from the results of an omnibus surveyasking a range of questions related to the Government’s proposals commissioned by Age UK in October2010.

2. Efficiency and Productivity Challenge

Demographic change will be one of the single greatest contributors to NHS cost growth over the next fiveyears. The King’s Fund report, How cold will it be?: Prospects for NHS funding 2012–17, estimates thatdemographic pressure alone will drive spending increases of between £1 and £1.4 billion per annum. Thisdemographic pressure partly reflects overall population increases, but it is largely growth in older age groupsthat will drive increased demand.63

The number of people aged 65 and over is expected to rise by 65% in the next 25 years to almost 16.4million, while the number of people over the age of 85 is predicted to double.64 The combined eVect of anageing population and increasing life expectancy will bring with it a higher prevalence of people living withmultiple long-term conditions, complex co-morbidities, mental health conditions, dementia and increasedhealth need through physical frailty. Overall, it is likely that a greater number of people will be living forlonger with chronic illness leading up towards the end of their life.

This is not a new issue, rather the intensification of a long existing trend cast into the spotlight by thecurrent financial climate. Older people already represent the largest patient cohort for the NHS, accountingfor over three quarters of all NHS patients65 and 60% of hospital admissions.66 It is, therefore, frustratingthat the NHS frequently fails to design and commission services that centre on the requirements of thosewho need and use it most, the elderly and frail. The results of these failures are hidden in plain sight: pooreroutcomes for older patients; poor management of long term conditions; substandard care that too oftenpays scant regard to people’s dignity; pressure on acute beds and A&E; increased demands on social care;and above all increased and unnecessary suVering for some of the most vulnerable at a time of need. Yet,seemingly because these problems cannot be ascribed to a specific condition or care pathway they aremarginalised, with attitudes towards standards of care and treatment for older people often characterisedby apathy and outdated fatalism.

Age UK has identified five key themes for reform which we hope the Committee will reflect in its finalreport.

Commissioning services appropriate to older people’s needs

The NHS continues to under-commission vital community and preventative healthcare used mainly inlater life, such as audiology, chiropody, ophthalmology, falls prevention services; and care and support forpeople with incontinence, depression, osteoporosis and arthritis. The reasons for this are varied but mustultimately point to poor needs assessments and service planning as well as overemphasis on the acute sector.Overall, it points to a failure to focus on the needs and long-term wellbeing of older people. There are alsoserious gaps and inequalities in service provision, most notably in relation to primary care in care homeswhere evidence suggests nearly 400,000 older people have diYculty accessing the services of a GP or otherprimary care professional.67 These services have a huge impact on keeping people well, in their own homesand avoiding the need for expensive, acute care.

Commissioning for multiple conditions and complex care

Our health services are failing to adequately support people with complex needs—often in late old age,coming towards the end of their lives. With so many older people using services, every health professionalcan expect to see people with complex, overlapping health problems; acute frailty; and cognitiveimpairment. However, we organise too much of our healthcare, and train our workforce, on a “conditionspecific” basis, rather than expecting everyone to be able to adopt a geriatric care perspective, focused onthe whole person and not the presenting health need. The findings of the National Confidential Enquiry intoPatient Outcomes and Death 2010 provide a clear recent example of systemic problems. A key issuehighlighted was the lack of routine input from specialists in geriatric medicine when an older person was

63 p16, How cold will it be?: Prospects for NHS Funding 2012–17: J Appleby, R Crawford, C Emmerson (2009)64 National population projections, 2008-based, OYce for National Statistics (2009)65 Based on Health Development Agency Annual Report 200566 “Acopia” and “social admission” are not diagnoses: why older people deserve better: D Oliver, J R Soc Med 2008: 101:

168–17467 p20, Ageism and Age Discrimination in Primary and Community Healthcare in the UK: A Clark, Centre for Policy on

Ageing (2009)



admitted into acute care. Lack of experience on the part of many acute clinical teams in dealing with theadditional clinical complexities caused by co-mobility, polypharmacy and frailty combined with insuYcientinput at an appropriate stage from appropriate specialists can reduce the likelihood of a patient beingrestored to health and discharged home safely.

Promoting integration

In too many places services still operate in silos and fail to oVer people a coherent package of supportacross organisational boundaries; the most obvious example being the lack of integration between socialcare and the health service. Recent announcements on the tariV for emergency readmission and NHSspending for re-ablement are welcome but address only a part of the problem. Problems also exist in theinteraction between primary, community and acute services within the NHS, and between services andindividual professionals focused on diVerent health conditions. We need a fundamental change in the patientjourney, so that people receive a coherent range of care and support, closer to home, with the support tomanage their own health conditions and retain as much control as possible over their own lives. In drivingimprovement and progressing reforms Government and local commissioners must focus on preserving whatgood practice does exist and make the most of the opportunity presented to finally embed the culture andorganisational relationships required to sustain integration.

Narrowing the gap in treatment outcomes for older people

People in late old age have not fully shared in improved health outcomes with respect to the main “killer”diseases of cancer, heart disease and stroke. Death rates for younger ages now fair well compared to otherdeveloped nations, but fall behind in a number of areas for people aged over 75.68 This indicates a systemwith in-built age discrimination. Indeed, a recent report commissioned by the Department of Healthconcluded that “evidence of under-investigation and under-treatment of older people in cancer care,cardiology and stroke is so widespread and strong that, even taking into account confounding factors such asfragility, co-morbidity and polypharmacy, we must conclude that ageist attitudes are having an eVect overallimpact on investigation and treatment levels”.69 More explicit age discrimination continues in pockets too,most noticeably in access to mental health services. It is clear that commissioners and healthcareprofessionals need to challenge their own perceptions of older people, abandoning the anachronistic notionthat poor health and disease are an inevitable part of old age. We know that more can and should be achievedto treat and delay the onset of disease amongst this age group, yet the NHS has not focused on improvingtreatment outcomes and quality of life for this cohort. The first draft of the NHS outcomes frameworkperpetuates this view, by proposing upper age limits to some indicators of clinical outcomes. We are anxiousto see these removed in the final version of the framework.

Safety, dignity and improved patient experience

The NHS still does not put dignity and patient experience at the heart of all that it does. People usingservices and their families still too often feel like an afterthought, with poor communication and lack ofinvolvement in decisions. There are also persistent inadequacies in basic care; falls in care, pressure ulcers,lack of assistance for patients to eat, drink and use the toilet are far too commonplace. Resolving many ofthese issues should be comparatively simple; solutions are rooted in ensuring adequate resourcing, serviceplanning and staV training. For example, in their recent report Safe Nurse StaYng Levels in the UK, theRoyal College of Nursing highlighted the strong correlation between appropriate staYng levels and skill mixon wards and patient outcomes (mortality and adverse events), patient experience, quality of care andeYciency of care delivery.70 The report also raised questions around the wisdom of higher register nurse topatient ratio on elderly care wards (an average of 11.3:1 compared to 9.1:1 on general adult wards).71

However, as the report also suggests, too many providers fail to suYciently get to grips with the problem.Therefore, without a strong steer from commissioners that the patient experience and patient safety reallymatters, under financial pressure they will always risk being forced down the list of priorities.

Successfully implementing QIPP

The Quality, Improvement and Productivity Programme (QIPP) has identified five workstreams inresponse to the “Nicolson challenge” designed to drive gains in safe care, long-term conditions, appropriatecare, emergency and urgent care, and end-of-life care. Age UK supports the overall thematic approach ofthe QIPP programme and we are cautiously optimistic about the potential for success, but we would stressthat, when set in the context of a growing elderly population, it is clear that improving care for older peoplewill be intrinsic in meeting the scale of those challenges.

To take long-term conditions as an example, prevalence amongst the older population is, as would beexpected, significantly higher than amongst other age groups. 39% of people over 65,72 rising to 67% ofpeople aged over 85,73 have a limiting long-standing illness. Older people are also at significant risk of

68 pp36–53, Ageism and Age Discrimination in Secondary Care in the UK: N Lievesley, Centre for Policy on Ageing (2009)69 p59, ibid70 p19, Guidance on Safe Nurse StaYng Levels in the UK: Royal College of Nursing Policy Unit (2010)71 p22, ibid72 The estimate is for the UK, based on Great Britain data from the General Lifestyle Survey 2008, OYce for National

Statistics (2010)73 Family Resources Survey 2007/8, Department for Work and Pensions (2009)



suVering from mental health conditions with depression aVecting 22% of men and 28% of women over 65.74

The impact on the NHS, particularly the acute sector, is clear. People over 65 with two or more long-termconditions account for the majority of adult bed days.75 Older people also account for nearly 150,000emergency readmissions to hospital each year (a rise of nearly 70% during the past decade).76 Indeed, theNuYeld Trust have identified improvements in the care of older people in relation to avoidable emergencyadmissions as one of the “biggest ‘eYciency frontiers’ for the NHS”77 with scope, therefore, for some of thegreatest savings to be made.

When considered in context it is clear that improving care of older patients should be an urgent priorityfor the QIPP programme. Aside from issues of underperformance in relation to elderly care, financialpressures will ensure that continuing the same patterns of care and service delivery is not a viable option.However, the scale of this challenge means that future NHS improvements and eYciencies will not beachieved through relatively minor adjustments but will require fundamental changes in the way in whichservices are commissioned and delivered. It will also require the NHS to challenge outdated and unhelpfulattitudes towards people in later life. At present it can only be concluded that NHS commissioning is notfit for the major client group it serves. As a result Age UK has called for Government to set a full review ofthe commissioning and delivery of older people’s care as an early priority for the NHS CommissioningBoard once it is established.

3. NHS Reform Process

In October 2010 Age UK commissioned an omnibus survey of over 1,000 people aged 65! covering arange of questions relating to the Government’s proposed NHS reforms. The views raised in response to thesurvey have been further augmented by a series of in depth listening events with groups of people in later lifeacross England. The themes and trends identified have informed Age UK’s overall response to the proposedreforms and our comments to the Select Committee. We, therefore, hope that the Committee will find furtheranalysis useful in providing additional background and depth to the oral evidence provided on7 December 2010.

Attitudes towards GPs and GP commissioning

People aged over 65 generally have a very positive view of their GP. A large majority (87%) think theirGP has a good understanding of their health needs as an older person. A similar proportion (89%) trust theirGP to provide them with the best healthcare that is available to them. This confidence in GPs as clinicians,however, does not always translate into wider support for greater involvement in commissioning on two keycounts; the survey revealed some ambivalence about how well GPs would champion older people’s healthservices specifically and a strong view that commissioning may not be an appropriate use of GPs timeand skill.

A high proportion (79%) have confidence in their GP to make the right decisions on the health and careservices in their area. However, views were mixed with respect to services for older people. 34% felt worriedthat older people’s health and care services would get worse if their GP had more control as opposed to 36%who were not.

When asked to rate whose views should be taken into account when making decisions about local healthservices most older people ranked GPs top, followed by hospital staV and other health professionals. Incontrast local people, patient groups and local authorities performed relatively poorly. NHS managers, whoare currently responsible for this work, came second from last with most people (25%) ranking nationalgovernment in bottom place. This is the clearest evidence from our survey that older people support theprinciples behind the Government’s reform agenda.

On the other hand, responses revealed concerns about the practicalities of GP commissioning. Barely half(52%) think that GPs have the skills to take some responsibility for management of the NHS, and 51% areworried about new responsibilities encroaching on the time available for their care. Furthermore, whenpeople were asked specifically about diVerent areas GPs should spend some of their time on, only two in fivesupported GP involvement in making decisions on how to improve the health of the whole community(38%), and only one in five (22%) thought GPs should spend any time on decision making over NHSfunding. Meanwhile, only 9% said their GP should spend any time on commissioning services and managingcontracts. What this perhaps tells us is that there is broad appetite for GPs to have more influence on services,but doubt as to whether they should be involved in the detail of decision making, especially if they lack thetime or skills.

74 Depression is defined as a high score on the GDS10 (Geriatric Depression Scale), Health Survey for England 2005: Healthof Older People, IC NHS 2007

75 “Acopia” and “social admission” are not diagnoses: why older people deserve better: D Oliver, J R Soc Med 2008: 101:168–174

76 Information Centre NHS http://www.nchod.nhs.uk/77 p2, Making Progress on EYciency in the NHS in England: options for system reform: J Dixon, NuYeld Trust (2010)



Localism versus nationalism

The same ambivalence towards GP commissioning is also clear in issues around local variation andnational entitlements. The survey found a number of mixed messages around the opportunity to defineservices at a local level.

At a conceptual level there is general agreement (67%) that flexibility at local level leads to better services.As outlined above, in terms of whose views should be taken into account when deciding about local services,Doctors/GPs are ranked highest and national government lowest. Equally when asked to choose betweentwo statements, 63% of older people endorse: “Local decision makers (such as GPs and local authorities)should decide what services are available in their area rather than a ‘one size fits all’ approach” over thealternative statement which 27% chose: “National government should decide what services are available andmake sure they are available to everyone regardless of where they live”.

However, on a personal level and thinking about their own lives, older people contradict the above viewwith 67% choosing the statement: “If I moved, I would expect to have the same health services in my newneighbourhood as I had in my old one” over the alternative statement endorsed by 24%: “If I moved, I wouldexpect to find diVerent local services according to the local needs”. So there is fairly broad agreement thatlocal services should reflect local needs, but also an expectation that individuals should receive theadvantages of a universal NHS oVer.

We also asked about local engagement and influencing of decisions. Although a clear majority (71%) thinklocal people should have a say over what health and care services are funded in their area, only 31% of olderpeople were willing to play a role in decision making themselves. Around half (51%) were not willing to play arole, 30% emphatically so. Increasing age also made it less likely that people would be willing to be involved.Awareness of ways of getting involved with healthcare decision making was low as well. Some 68% havenever heard of Patient Participation Groups, Local Involvement Networks, or any other public involvementgroups. There was some social class variation with socio-economic groups A and B generally having greaterawareness (34% had heard of Patient Participation Groups compared to 20% across all groups). We believethis highlights an important issue for Government in advancing their proposed reforms given that they relyheavily on local engagement. Steps must always be taken to appropriately and proactively seek the views ofall parts of the community, in particular those individuals who may be socially isolated and excluded, as forexample the very elderly and frail.

Choice and competition

A majority of older people are wary of increased competition between health services—61% disagree thathealth services should have to compete for patients and 57% think standards of care would decline if healthservices had to compete. This position was supported by views and concerns expressed by older peopleduring our listening events. Although many of the event participants valued choice in when, where and howthey received treatment as an individual patient, there was a strong view that expecting patients to “votewith their feet” was not an acceptable mechanism for improving quality. In particular, participants in ruralareas felt those unable or unwilling to travel further would find themselves stuck with “second rate services”.

More positively, the majority of older people think they would find it easy to exercise choice betweendiVerent providers.

When asked to rank the most important considerations for them if they need to choose a health services,50% rated how quickly they could get treatment as most important. This was closely followed by how closeit was to home (29%) and reputation or performance standards (23%). Friendliness of staV was not seen asvery important with only 6% of respondents rating this top of their list. These trends provide interestinginsight into how older patients may respond to greater choice of health providers and influence marketmechanisms. A number of examples oVered in the choice and competition consultation are predicated onindividuals waiting longer to get the most appropriate care which may not prove to be the case.

January 2011

Written evidence from the NHS Confederation (COM 121)

1. Introduction

The NHS Confederation is the independent membership body for the full range of organisations thatmake up the modern NHS. We have over 95% of NHS organisations in our membership includingambulance trusts, acute and foundation trusts, mental health trusts and primary care trusts plus a growingnumber of independent healthcare organisations that deliver services on behalf of the NHS.

We are pleased to have the opportunity to submit evidence to this inquiry. The comments in thissubmission reflect the views and experience of our NHS and independent sector provider members, as wellas those of our PCT members as the current statutory commissioners in the English NHS.

More detailed information about our members’ views on the Government’s health White Paper can befound in our responses to the Department of Health’s consultations.



2. Summary

— We support the Government’s objectives in the White Paper. Empowering patients is clearly theright thing to do. There are strong arguments for involving clinicians more closely in decisionsabout the design of care and management of resources, and holding them to account for thesedecisions. We also support the Government’s aspirations to further strengthen commissioning aswe believe commissioning is a critical component of a tax funded health care system and willbecome more important than ever as resources become tighter.

— However after analysing the proposed system, we have identified significant risks, worryinguncertainties and unexploited opportunities. All of these will need to be addressed if the reformsare to have the best chance of success. Our key concerns include:

— A lack of clarity on the accountability of GP consortia to patients, the public and Parliament.

— Risks of an over-reliance on market mechanisms to manage complex health services.

— Risks of fragmentation of commissioning and health service provision as a result of theproposals.

— Risks of weakening the commissioning of primary care services.

— We feel there are potential tensions between the ideas that service change and improvement willincreasingly be driven through patient choice and competition, that GP commissioning consortiawill make commissioning decisions on behalf of their patients, and the intention that Health andWellbeing Boards including locally elected politicians will have significant influence over thosedecisions and so strengthen the democratic accountability of the NHS.

— More attention must be paid to the transition to the new system, particularly stability andconfidence in commissioning arrangements for providers, capability and capacity building, thesignificant culture change required, and how significant eYciency savings will be delivered whilstmajor reforms are ongoing. Key issues during transition include:

— Significant reductions in management capacity as a result of management savingsrequirements risks causing quality and financial performance deterioration over the nexttwo years.

— Risks of loss of commissioning capacity and expertise from PCTs, leaving GP consortiawithout the necessary support and organisational memory.

— The importance of capacity building for the proposed GP consortia to prepare them for thecomplex commissioning responsibilities they will be taking on.

— Explaining the significant cultural change that the reforms will require and helping the public,the NHS, media, and MPs to understand its implications.


How will commissioners access the information and clinical expertise required to make high quality decisionsabout the shape of clinical services?How will commissioners address issues of clinical practice variation?How will GPs engage with their colleagues within a consortium and how will consortia engage with the widerclinical community?

3.1 It is important that the reform proposals are further developed and implemented in a way that enablesand supports engagement and cooperation between GP commissioners and the wider clinical community(including other providers). Factors which could create barriers to this engagement include:

— Procurement and competition rules, if not applied appropriately.

— Providers’ funding arrangements and incentives.

— SuYciency of management resources to sustain eVective engagement.

3.2 The government’s expectations as to what extent and when commissioning consortia will be expectedto proactively specify or shape services, or intervene to address issues of clinical variation, also need to beclarified. This will aVect the governance, management and support arrangements they will require.

3.3 We feel the proposals should make more of the potential of GP consortia to drive improvements inprimary care provision. We believe the Government should give the NHS Commissioning Board the powerto delegate responsibility for practice performance and contract management of General Medical Services(GMS) contracts to GP consortia where appropriate. The distribution of any performance payments relatedto commissioning should be the responsibility of the consortia.



4. Service Reconfiguration, Strengthening Commissioners Against Provider Interests andOpening the System to New Entrants

Will care providers be free to oVer new solutions which oVer higher clinical quality, better patient experienceor better value?Will commissioners be free to access new commissioning expertise?Will potential new entrants be free to oVer alternative commissioning models?What arrangements will be made to encourage the Third Sector both as commissioners and providers?How will the proposed system facilitate service reconfiguration?How will the new arrangements strengthen commissioners against provider interests?

Implications for providers

4.1 We welcome the commitment to increasing choice and quality for patients and value for taxpayers,facilitated by a healthy provider market including both NHS and non-NHS providers.

4.2 Healthcare providers will need to see clear market opportunities and suYcient stability to give themthe confidence required to make investments and service changes. There is some concern that the instabilityand uncertainty caused by the current approach to managing transition could undermine potential newentrants’ confidence. There are also concerns that existing providers could face higher transaction costs onan ongoing basis if the number of commissioning organisations increases. Factors that could help to providegreater stability and confidence include:

— Clarity of market rules and simplified contracts.

— SuYcient scale and scope of commissioning organisations.

— Aligned rewards, incentives and rules.

4.3 We believe the government should put in place an assurance system to ensure GP consortia establishstrong governance arrangements with clear, transparent and robust decision-making to address any conflictsof interest between their roles as commissioners and providers.

4.4 There is concern that with the loss of PCTs and SHAs there will no longer be any safeguards to protectagainst system failure, at a time when supply-side controls are liberalised and commissioning is reorganised.Monitor’s new role as the economic regulator will be crucial. It should be required to engage with GPconsortia as well as the NHS Commissioning Board and should have a duty to work to support the interestsof both commissioners and providers.

Sources of commissioning expertise

4.5 Exceptionally strong clinical and managerial leadership will be required in the establishment anddevelopment of GP consortia, and in the ongoing management of complex relationships with a wide rangeof partners. Some GPs will also need support and training to develop more technical strategiccommissioning skills in order to run the consortia eVectively, and to be an “intelligent client” ofcommissioning support providers.

4.6 Independent sector organisations are already involved in providing commissioning support services.However despite involvement in certain areas of commissioning the existing market does not have a trackrecord of running comprehensive health service commissioning support services, and a process of marketdevelopment will be required to ensure the requisite services are available to GP consortia and the NHSCommissioning Board. Start-up funding may be necessary to encourage investment and recruitment,particularly for smaller or more specialist organisations.

4.7 People currently working in PCTs, Specialised Commissioning Groups, and SHAs are best placed tosupport GPs to develop their own skills and evaluate support service providers, as they have the most up-to-date skills and expertise in these areas.

5. Accountability for Commissioning Decisions and Resources

How will patients make their voice heard or their choice eVective?How will commissioning interface with Health Watch?What will be the role of the NHS Commissioning Board?What legal framework will be required to underpin commissioning consortia?Where will the “buck stop” when commissioners face hard choices?What arrangements will be made to safeguard patient care if a commissioner gets into diYcultyWhat legal framework will be required to underpin commissioning?

5.1 In our consultation with members the proposed accountability structures have caused most confusionand uncertainty.

Accountability of the NHS Commissioning Board, GP consortia and their member practices

5.2 The exact nature of the NHS Commissioning Board’s accountability to Parliament is unclear. Manyof the issues of most concern to local MPs will be the responsibility of consortia, with oversight sitting withlocal Health and Wellbeing Boards. We believe the government should make explicit where in the new systemMPs and local councillors should direct enquiries they are making on behalf of their constituents abouthealthcare, and who will be expected to respond to these enquiries.



5.3 Clarification is also needed on the relationships between GP commissioning consortia, their memberpractices, the NHS Commissioning Board, Health and Wellbeing Boards and Monitor.

5.4 Currently, we feel there is confusion and possible conflict between the ideas that service change andimprovement will increasingly be driven through patient choice and competition overseen by the economicregulator, that GP commissioning consortia will make commissioning decisions on behalf of their patients,and the intention that Health and Wellbeing Boards including locally elected politicians will have significantinfluence over those decisions and so strengthen the democratic accountability of the NHS.

5.5 The White Paper indicates that Health and Wellbeing Boards will take on the existing scrutiny powersof local authorities, but it is not clear whether they will have any additional powers to shape or makedecisions about local health services, which will be commissioned by GP consortia, or what roles electedmembers and local authority oYcials are expected to play on these boards.

5.6 The proposals suggest that local authorities will enable strategic coordination of health and socialcare locally but that this will not involve day-to-day interventions in services. We are concerned thatconfusion and conflict of interest could result in cases where there is no clear and easily definable distinctionbetween strategy and implementation.

5.7 The arrangements for consultation on and scrutiny of major strategic changes pay too little attentionto the potential for provider-led service change, and the relationship between the Health and WellbeingBoards and Monitor is also unclear.

5.8 If local government and locally elected politicians are to be given greater influence over the NHS, andperhaps take on some of the system management roles currently performed by PCTs, they must be given therequisite powers and authority, and this transfer of accountability should be made clear to the public.

5.9 Alternatively, if the Government proposes to remove the state’s role (currently carried out by PCTs)in overseeing, monitoring, and at times intervening in the running of local health systems in favour of moremarket-based mechanisms for driving quality improvement, this again should be clearly and transparentlyarticulated.

Governance and decision-making

5.8 As well as clarity regarding their accountability, GP consortia will need a clear understanding of thestandards of governance that are expected of them, although this need not involve direction as to how toachieve these standards.

5.9 We believe the Government should spell out how it will deal with GP consortia that fail, and ensurethat the rewards of success and the consequences of failure are proportionate and significant enough to havean impact on their behaviour.

5.10 We believe the Government should consider whether it needs to set out in regulations whichdecisions about quality standards and access to services will be consistent across the country and which willbe left to local commissioners to determine. GP consortia will be subject to legal challenge about how theymake prioritisation choices and will need to have very clear frameworks for decision-making. This will beparticularly important in light of the EU directive on the application of patients’ rights in cross-borderhealthcare.

5.11 We believe the Government should ask the NHS Commissioning Board to set out a transparentmethod by which it will turn NICE recommendations, based on clinical and cost eVectiveness, intoaVordable commissioning criteria.

Patient voice

5.12 It is vital that all organisations involved in commissioning health and social care services ensureeVective patient and public engagement is integral to their commissioning processes. This should includefeedback from individual patients and users of services, but also broader public views on local services,including those of people who may not access services, and who may be less willing or able to express theiropinions. The management allowance for GP consortia and the resources of the NHSCB will need to besuYcient to cover this.

5.13 Existing practice patient groups and the proposed local HealthWatch arrangements couldpotentially play an important role as part of a wider range of engagement and involvement opportunities,but we do not believe they would be suYcient as they currently operate or are described. Particular attentionshould be paid to the resourcing and capacity development of HealthWatch. We believe the governmentshould consider tasking Citizens’ Advice Bureaux to provide complaints advocacy and support for choicelocally, but should ensure specialist advocacy services are retained to support some of the most marginalisedand disadvantaged users of health and social care services.

5.14 Inherent conflicts of interest between HealthWatch England and the Care Quality Commission, andbetween local HealthWatch and their local authority, especially in relation to the scrutiny of their social carecommissioning role, require resolution by government.



5.15 Further clarity is needed about the extent to which choice of commissioner is intended to play a partin driving improved quality and outcomes. The power of patient choice to send signals to consortia will bevery limited in practice and other methods will be required.

6. What will be the Role of Local Authorities in Public Health and Commissioning Decisions?

How will any new structures promote the integration of health and social care?What arrangements are proposed for shared health and social care budgets?How will commissioning interface with the Public Health Service?

6.1 It will never be possible to design a system at a national level that resolves the complexity of the gapsand tensions between healthcare, public health and social care. We therefore agree that the government’srole should be to clearly set out the outcomes to be achieved, and that as far as possible local partners shoulddevelop their own ways of working together to achieve them.

6.2 However, we believe that further detail regarding the parameters within which local partners will berequired to work (for example, how funding will flow to them and what rules will be applied to it, what dutiesand powers they will have, who they are accountable to) is required.

6.3 The government should clarify the public health and health improvement roles and responsibilitiesof the diVerent tiers of local government, and how these relate to the Health and Wellbeing Board, andprovide the flexibility for joint health and wellbeing boards across local authority areas. Clarification is alsorequired about how public health funds will be defined, devolved and ring-fenced.

6.4 Improving integration will require co-ordinated planning across systems and incentives forcommissioners and providers to work together. Local authorities and GP consortia will carry out joint localarea assessments of need, and we believe they should be asked to work together to develop and deliver ajoined-up health, public health and social care strategy in response.

6.5 GP-led commissioning consortia will require access to public health expertise. It is currently unclearwhether they will be expected to purchase these services from local authorities (in which case theirmanagement allowance must be suYcient to cover this), if directors of public health will be responsible formaking them available, or whether the new Public Health Service will have a role.


How will resources be allocated between commissioners?What arrangements are proposed for risk sharing between commissioners?

7.1 Since the formula for allocating NHS resources to PCTs was last reviewed, there has been a gradualmove toward “fair-share funding”, though incremental changes to PCTs’ annual allocations. This processhas so far been very slow, in order to avoid suddenly destabilising local health economies that are “abovetarget”. Consortia who find their inherited budgets are “below target” according to the current formula willwant assurances that they will receive a fair allocations, but rapid changes to allocations and fundingformula could have severe consequences for consortia that find their budgets reduced below the historicallevels of spend. Establishing fair share allocations for consortia could be extremely complex, and failure tofind ways through this could seriously undermine the policy.

7.2 We are clear that if GP consortia are to receive the funding for all local health services they must alsotake on all of the existing commitments and liabilities that come with it, otherwise the incentive to resolveproblems that have precipitated overspends, such as ineYciently configured acute services, will not exist.

7.3 Risk pools for consortia and other commissioners will be an important part of the system, but webelieve the Government needs to prevent proliferation of overlapping risk pools to avoid taking significantfinancial resources out of circulation.

7.4 Further consideration of the financial risk posed to GP consortia by the rapidly rising cost of payingfor NHS continuing health care (CHC) is required.

8. Specialist Services

What arrangements are proposed for commissioning of specialist services?How will these arrangements interface with the rest of the system?How will vulnerable groups of patients be provided for under this system?

8.1 We agree that the commissioning of designated specialised high-cost, low-volume services should notbe devolved to individual consortia. However, if the NHSCB is to take on this role the following issues needto be considered:

— Local knowledge is required to understand patterns of need, demand and service configuration andenable robust contract and performance management. Some form of “sub-national” presence andleadership will be necessary.

— Inter-dependencies between higher-volume non-specialised services and specialised services meanthere are risks in commissioning these separately, including cost and blame-shunting, which willneed to be managed with the involvement of GP consortia.



8.2 We believe a set of clear principles should be developed for determining what will be commissionednationally or at a local level, and where consortia should consider joining together in shared arrangementsor handing over commissioning responsibilities to a specialist agency. These principles could be provided byGovernment or developed by national representative bodies.

8.3 It will be important to establish what support consortia will need in commissioning services that,although not designated as specialised, may still require particular knowledge and expertise, or wherecommissioning will need to be coordinated across multiple consortia.

8.4 For example, GP-led consortia may require particular support in commissioning mental healthservices, including from non-NHS organisations with access to service user, carer and clinical expertise. Webelieve that GP consortia should work with specialist providers to develop and deliver a capacity-buildingprogramme to ensure that GP consortia have the right expertise to commission mental health services.

8.5 We also believe that certain urgent and emergency are services, including emergency preparedness andambulance responses, will need to be commissioned at a multi-consortia, and in some cases a national, level.

9. Transitional Arrangements

Will the new arrangements safeguard current examples of good practice?How will transitional costs (redundancy etc) be minimized?Who will drive innovation during the transitional period?

9.1 A failure to manage transitional risks eVectively could result not just in examples of good practicebeing lost and rates of improvement slowing, but also in serious financial or quality failures in parts of theNHS. It is vital that the transitional period is given as much attention as the design of the system.

9.2 If new commissioners are required to build their confidence and skills from scratch, potential newproviders could lack confidence in the system, and progress towards a more dynamic and diverse providermarket could stall for a number of years. Commissioners’ decision-making processes could also becomecumbersome and fragmented while multiple stakeholders establish their positions in the new system, whichcould make it more diYcult for existing providers to take forward necessary reconfiguration plans andproposals for eYciency savings.

9.3 There are a number of actions that we believe would help including:

— Assurance that there would be a degree of continuity and properly managed transition to newcommissioning arrangements.

— Early confirmation of the arrangements for the new commissioning bodies, particularly theirfunctions, how funding will flow to them, the financial rules that will apply, and the accountabilityframework.

— Investment in capability and capacity building for GPs and other clinicians who will be involved inthe leadership of the new consortia, and access to expert commissioning support in the meantime.Primary care trusts have built up a wealth of expertise that will be vital to the success of the newconsortia. Urgent action is needed to retain good staV and preserve organisational memory; it willbe diYcult and expensive to re-build this knowledge and skills base.

9.5 We support scrutiny of management costs as part of the wider NHS productivity drive. During thetransition period, the focus should be on managing the overall costs and sustainability of a system facinghuge financial challenges. Our members have major concerns that doing this alongside developing thecapacity and capability of GP consortia will not be possible with 45% management cost reductions over thenext few years.

9.6 In providing eVective and good quality services to patients, management is an essential investment,not just a cost. The Government should acknowledge the contribution and progress made by the existingPCTs, which still have responsibility for the control of finances and delivery at present. To do this will senda positive message to those who are set to take over these responsibilities: potential leaders of GP consortiashould not think that that they will be the next in line for criticism when tough decisions are needed anddiYcult change has to be managed.

October 2010

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PEFC/16-33-622

Documents

00 - Commissioning - Vol II oral+written€¦ · 121 Centre for Public Policy and Health, Durham University Ev w354 122 Royal College of Midwives further evidence Ev w359 cobber Pack: