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ON THE RECORD
STEPHEN DORRELL INTERVIEW
RECORDED FROM TRANSMISSION BBC-1 DATE: 2.2.97
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JOHN HUMPHRYS: Mr Dorrell, a central plank of your
platform, your election platform, is that the NHS is safe in your hands. Now
you're going to have difficulty persuading people to believe that aren't you,
indeed you already are having difficulties persuading them to believe that, and
the reason for that is that all the experts, all the commentators, all the
observers agree that there must be at least three per cent more over and above
inflation paid into the NHS by the Government every year. Now that has
happened in the past, it isn't happening now, it isn't going to happen in the
future, therefore people are right are they not to be a little doubtful about
your claim?
STEPHEN DORRELL: Well, I don't accept the figure of three
per cent relentlessly every year as the inevitable amount that has to go into
the Health Service.
HUMPHRYS: That's what's happened ever since the
NHS began.
DORRELL: Having said that I do point out that
since 1979 that does actually happen to be precisely the figure that has been
the average increase in real terms year by year that this government has
provided to the Health Service, ...
HUMPHRYS: Since 1948 in fact - you can go back to
that if you like.
DORRELL: And when we look into the future the
Conservative Party is committed to real terms growth of the Health budget year
by year for the five years of the next parliament. That's something that I've
challenged my Labour opposite number, the Prime Minister has challenged Mr
Blair to give an equivalent pledge. They've refused to do it. Labour won't
give the pledge to real growth of Health spending, that is the pledge that the
Conservatives have given.
HUMPHRYS: And of course I am talking in real terms
when I talk about three per cent, when you talk about three per cent, let's be
clear, we are talking about the same thing - three per cent over and above
inflation.
DORRELL: Yes.
HUMPHRYS: Well, let's look at what is actually
going to happen now, over the coming years, 1996/97 nought-point-six per cent,
that's far less that what is needed so they say - '97 to '98 nought-point-eight
per cent, 1998/99, a cut - now I know there are special reasons for that
because some of the duties that are being carried in the NHS will be carried
out Department of the Evironment, so there is a reason for that. Nonetheless a
very small increase, and 1999 to 2000 nought-point-one per cent now that is
nowhere approaching the three per cent that it is agreed by virtually everybody
is needed to keep the NHS doing what it's doing at the moment pretty much.
DORRELL: As I've already said, I don't accept
that every year, that the circumstances every year are the same. That is not
the case, and that is why over the eighteen years this government has been in
office we've had some years when the Health budget has gone up by very much
more than the figures you are quoting, and some years when the figures have
gone up by less, but every single year since 1979 there has been real growth in
the Health budget. We're committed to real growth during the next parliament.
As regards the next financial year, the one where we announced the budget in
November, I announced in November an increase of one-point-six billion pounds,
that is almost exactly three per cent real growth over and above inflation in
the money available to the Health Service for patient care. Now what is also
happening the Health Service next year, is that we're planning a continued
growth of the private financing of the capital budget of the Health Service,
and it's by providing that kind of public/private partnership that we're able
to make the tax payers pound go further and treat more patients. Three per
cent real terms growth in the current budget of the Health Service is actually
exactly what the Government has provided next year.
HUMPHRYS: Except that you're not now comparing
like with like, you're not comparing the three per cent that I gave you which
was three per cent over the entire Health Department budget, the entire NHS
budget, with the same figure. You're comparing it with a figure specifically
for front line patient care, very praiseworthy of course, but nonetheless it
isn't the same amount of money, and that's very important.
DORRELL: I plead guilty to the charge that what
I'm focussing on is front line patient care. What I've delivered for next
year, what the Government is delivering next year is real terms growth of three
per cent in the money available as you correctly described it for front line
patient care.
HUMPHRYS: Will you do the rest of the NHS then?
DORRELL: Well no, what we're also doing is
reforming the capital budget of the Health Service. Throughout fifty years of
history one of the things the Health Service has less reason to be proud of
than other things is its failure to modernise the hospitals and the capital
stock, the kit available for health care as quickly as it needed to be
modernised, and that's why this government has introduced for the first time
the principles of the private finance initiave, public/private partnership so
that private capital can be made available to the Health Service to modernise
the buildings in which free NHS care is provided. That's - I think it's dead
right to focus the taxpayers' pound on front line patient services and look for
other ways, better and more efficient ways, of modernising the buildings in
which NHS clinicians work.
HUMPHRYS: Well, let's deal with the first of those
points first, and I know the figures can be a bit tedious after a while, but
nonetheless I repeat that you're not comparing like with like. You're using a
few mirrors here aren't you because you're talking, you're saying that this
one-point-six billion pounds adds up to three per cent, which is roughly
comparable with what you have been spending in the past, and of course it isn't
because in the past when they've taken that three per cent figure, they've
taken it over the whole of NHS, and therefore it is a much higher figure
proportionately allowing for inflation and all the rest of it, then this
one-point-six billion. So it isn't a true three per cent at all.
DORRELL: But in the past the Health Service has
been refused - successive governments have refused to allow the Health Service
access to private capital.
HUMPHRYS: We'll come on to that in a minute, but
I..
DORRELL: It's absolutely central to this
argument.
HUMPHRYS: No, it isn't.
DORRELL: With great respect it is essential to
this argument, because it's by bringing private capital in to modernise the
Health Service, that instead of every pound spent by the Health Service both
capital and current having to come from the taxpayer we've now got a position
where the taxpayer pays for health care delivered to patients, but the private
sector comes in alongside in order to modernise the buildings in which
taxpayers' pounds are spent.
HUMPHRYS: Well, let's look at that then in a bit
more detail, and then we'll come back to that one-point-six billion, but let's
look at that private capital for a moment. You're suggesting in effect that
there is such a thing as a free lunch here, but let me point out that if a
private company or a consortium of companies, banks, building companies and
whatever build a hospital, they're not doing it for the good of the nation's
health or because they're altruists, they're doing it because they want to make
a profit on that enterprise, so you are going to have to pay we, the taxpayers
are going to have to pay the bills for that, so what you're doing in a sense is
mortgaging the future, and suggesting to us that this is in some way free
money. It isn't anything of the sort.
DORRELL: No, of course it isn't free money, but
there's a rather simple and obvious flaw in your argument if I may say so,
which is the assumption that if the taxpayer borrows money to invest in
hospitals that's free. Now when you lend money to the government in gilts...
HUMPHRYS: But at least it's honest, we know where
it's going to.
DORRELL: Well, it's honest in both cases if I may
say so. The position is that the money used to build a hospital costs the
taxpayer, costs it either through.....because the Government has to pay the
interest rates on gilts on the money that it borrows, or it costs it because
the private sector provides the money...
HUMPHRYS: And it shows up here in this red book,
in the Treasury's financial statement.....
DORRELL: Just before we leave the point let's
just accept .....
HUMPHRYS: I'm not leaving the point - this is the
point.
DORRELL: You are suggesting that I'm introducing
an extra cost into the public finances by bringing in private finance into the
Health Service.
HUMPHRYS: You're clouding the figures.
DORRELL: I'm not clouding the figures. What I'm
seeking to do is to clarify them. The position is that whether a hospital is
built by the private sector or by the public sector the capital that goes into
that hospital costs money. What I'm seeking to do is to use the taxpayer
pounds to buy patient care and to provide a partnership with the private sector
so we've got more money available, not less, more money available to the Health
Service to modernise the buildings in which care is provided.
HUMPHRYS: But you see, this is-this is where the
fallacy comes in: more money available. You don't have more money available.
Instead of, as it were, borrowing it from us - the taxpayer - saying to us, the
taxpayer: look, we want you to build a new hospital and you'll pay for it out
of your taxes over the coming years, you're saying: we've got more money now
because these private industrialists, or banks - or whoever they are - are
going to build these things for us. They're not going to do anything of the
sort! They're going, in effect, to lend us money and charge us for it. And,
when you look at what your own people say about the private financing, and the
effect it's going to have on Health Service costs: let me quote to you from
Andrew Neil, Head of the PF Unit in the National Health Service. Several
trusts - hospital trusts - cannot afford the annual payments... head to when
these PFI things become a reality. The funding gap for some schemes is four
million pounds a year for the lifetime of the contract. So, they've got to pay
for it. We've got to pay for it ultimately. It ought therefore to be in their
book.
DORRELL: But you and I have to pay for it if
we're going to continue to have tax-funded health care.
HUMPHRYS: Of course, we do.
DORRELL: Whether it's provided by the public or
the private sector. The position-the difference between the traditional means
of financing hospital building and the private finance means that we are
introducing is this - and it's a fundamental difference: traditionally, the
Health Service, a Health Service capital project always had to pass three
tests. It had to be affordable, it had to be good value and then it had to
wait for a ration of capital coming from the Treasury. Now, we've abolished
that last test. Still it has to be affordable - of course it does. It has to
be good value? Of course it does. But now we can- are in a world where if a
hospital project is both affordable and good value, then, the Trust is free to
find a private sector partner to build that hospital.
HUMPHRYS: Have they got the extra money to pay for
it?
DORRELL: It doesn't have to wait for the ration
of public capital-
HUMPHRYS: Of course not. Absolutely.
DORRELL: That's what's trapped-that's what
trapped the Health Service for fifty years in hospitals that are out of date
and without adequate modern kit.
HUMPHRYS: Yes, but you're arguing-But, what has
trapped them in the past and traps them still is the cash to pay for it and the
fact that some company down the road says: alright, we will build a hospital
doesn't change the economics, the true finance of it at all. They still have
to pay for it.
DORRELL: John, with great respect, you are wrong.
HUMPHRYS: What do you mean? They're going to do
it for free?
DORRELL: You are wrong because you're suggesting
that there is no extra cash available to the Health Service from the private
finance approach. That is simply not true. What we are doing is-What we're
providing here is an arrangement that allows us to focus the taxpayer pounds on
treating the patients and where there is an opportunity to modernise the
hospital building, to deliver more efficient health care, more up to date
health care, then provided the project is affordable and good value, it can go
ahead without having to compete for cash in the public sector capital pool.
HUMPHRYS: Alright, alright. Alright, we'll-we'll
leave that for a moment. Then, let's look at the other aspects of this one
point six billion that you're so proud of having won from the Treasury. The
truth is, when it comes down to it, it's not going to be one point six billion
at all, 'cos one of the things it's going to have to do is pay for the debts -
the various hospital trusts have incurred over the past year, because last
year's settlement wasn't enough to enable them to do what they wanted to do.
So there's a couple of hundred million pounds gone for a start.
DORRELL: Well, you say it isn't going to be one
point six billion. It is going to be one point six billion..
DORRELL: In real terms, they won't have that to
spend, is what I'm saying.
DORRELL: Anybody looking at the history of a
large public service knows that there is always a degree of flexibility in the
financing between individual years. Indeed, under the old rules, we always
used to be criticised for artificial rigidity across the end of the year.
We've relaxed that in order to give people the incentive to use money
efficiently through all twelve months of the year, rather than as used to be
the case, wasting money in the last year because, in the last month of the
year, because they wouldn't be able to carry it over to the following year.
HUMPHRYS: Yeah, but they're not going to have one
point six billion pounds to spend in this coming year. That's my point, it's
going to be considerably less than that.
DORRELL: The money available for the treatment of
patients next year, compared with the money available for the treatment of
patients this year, has increased by one point six billion pounds.
HUMPHRYS: Well, if you ignore the other figure,
perhaps. But there's another factor here, isnt't there? And that's inflation.
Now, that figure - one point six billion - was arrived at on the assumption -
and it sounds a lot of money, certainly - on the assumption that inflation is
going be somewhere around two per cent - two and a half per cent - something
like that.
DORRELL: I was going to remain silent, I won't
remain silent on that subject because I actually think that, of course we have
figures that we use as assumptions, but actually when you're planning a
service, I think you have to plan it in cash. And, you don't-You should not
tie yourself to specific inflations.
HUMPHRYS: But that was broadly the range that you
were looking at, when you - when you arrived at those figures, wasn't it?
DORRELL: It's-It's those kind of figures are
sensible assumptions. But it doesn't alter the fact that the planning of the
Health Service next year has to be done in cash-
HUMPHRYS: Of course, it does.
DORRELL: -and not with deflated numbers.
HUMPHRYS: And that is exactly my point
because-because what I wanted to bring to your attention now is the fact that
you are going to be sitting around in Cabinet next Thursday, having a look at
the recommendations of the pay review bodies. Now they've been leaked, the
result of those recommentions have been leaked, I don't expect you to confirm
them. I know Cabinet Ministers never do that sort of thing, but one of the
things they tell us is that nurses, according to these recommendations will get
an extre three point four per cent in their pay. And that's just nurses;
doctors more and so on. In other words it's going to bust that two to two and
a half per cent inflation assumption. You therefore are going to have to go
into Cabinet next Thursday and argue very firmly, aren't you, that they are
going to have to hold the line with those pay increases? Because otherwise,
it's going eat up a huge chunk - another huge chunk - of that one point six
billion.
DORRELL: But, I'm not going to discuss in detail
the review body reports. The Government has them and is considering them and
will announce its conclusions on them when a decision has been made. What I
will do is to say clearly, first of all it was this Government that set up the
Nurses' pay review body; secondly, that we have implemented every report of
both the nurses' pay review body and the doctors' and dentists' review bodyand-
HUMPHRYS: Well, you've staged them, haven't you?
You've staged the increases, so-
DORRELL: We have implemented their
recommendations. So, we believe that this - our actions - demonstrate that we
believe that this is a sensible way to set professional pay levels in the
Health Service. But we also clearly have to look at affordability within an
individual year of the recommendations that the review body makes. So we have
to be good employers, we have to respect the independent recommendations of
these review bodies, and we have to look at affordability. And, those are the
three standpoints from which we are looking at these review bodies reports now
and we shall announce our conclusions when we've made our decisions.
HUMPHRYS: And when you say we have to look at
affordability, what you mean is that if too much is taken out of that pot, that
extra one point six billion to pay nurses for instances - and we all know that
salaries account for, what is it, seventy per cent of the total NHS bill? - if
a socking great increase - some would say not a socking great increase, but
much higher than your assumption - is going to pay those bills, you've got a
problem next year. So you're going have to say: Hm! To be tough, haven'tyou?
DORRELL: When I talk about affordability, what I
mean is affordability to the taxpayer. This is public money. This is
taxpayers' money we're spending. It is raised from people involuntarily
through taxation and the decisions we have to make are the question: whether
the taxpayer can afford, what the taxpayer can afford, given the other
interests of being a good employer of professional staff and respecting the
independent recommendations of the review body. And, as I said, I'm not going
to be drawn further into the conclusions we shall reach beyond saying: those
are the principles we shall look to (phon).
HUMPHRYS: But, you are going to have to listen,
aren't you, to people like Philip Hunt, the Director of the National
Association of Health Authority and Trusts, when he says: if it costs that
much, if you give them that kind of increase, we're gonna have to find the
money from somewhere and that will mean cuts in jobs and services. That's
going to have to be at the forefront of your mind.
DORRELL: There are, of course, always choices to
be made about how you use resources. Am I going to listen to Philip Hunt? Of
course, I'm going to listen to Philip Hunt. But, the principles that we have
to apply to make this decison are clear and straightforward. We have to be a
good employer of our professional staff, we have to respect the review body
reports and we have to make a decision that is affordable to the taxpayer.
HUMPHRYS: Does it worry you at all that they do
keep throwing up increases that tend to bust the budget occasionally? Have you
thought of looking at different ways of renumerating (phon) nurses and
doctors, looking at different pay structures that would reward special service
and particular skills and that kind of thing?
DORRELL: Well, of course, we look every year at
the total picture of the employment package of our professional staff and that
goes into the recommendations that we make in our evidence to the review
bodies, that is what any employer ought to do; to look at the position, look at
how easy they find it to recruit; to retain, to motivate the staff they have.
Look at how the deal that they offer compares with other comparable employers
who may be competing for the same kind of people. So, we have to look at that
in detail every year - of course, we do - yes.
HUMPHRYS: Let's have a look now at the effect of
money problems and there are always money problems in the NHS. And, as I say,
my contention is there are going to be much more of that in the future on
patients. Waiting lists - you're very proud of the fact that waiting lists -
well, certainly, people for over a year or longer - have come down dramatically
over the past few years. There's no argument about that. But, now they are
beginning to creep up. And, I use the word 'creep' because it is not an
enormous increase from six thousand to fifteen thousand months, over the past
six months or whatever it is. That's a straw in the wind, isn't it?
DORRELL: I'm not sure that it's a straw in the
wind. What it reflects is the Health Service doing something that I stressed
at every Health Service audience that I went to in the summer - seemed to me
important. That following the emergency service pressures that we experienced
last winter, it was important for us (in my phrase) 'to do first things first'.
Where there's an emergency need presented to the Health Service, I think, most
people would recognise that that has to be met and if an emergency need,
particularly in the middle of winter leads to an extension by week or a
fortnight of a waiting time for a non-urgent treatment, then, I think, that
most people even the patient on the waiting list will usually accept that that
is a fair, a proper, way to use resources.
We've seen a dramatic improvement in
waiting time performance, we must not go back to the old days, where there were
up to a quarter of a million people waiting on waiting lists for more than a
year. That figure, as you rightly say, is now down to around fifteen thousand
in the last available information. We must not go back to the old days but the
Health Service must deal with the emergency, urgent treatments first, if
necessary at the expense of the elective patient waiting a week longer.
HUMPHRYS: Let's just take a look at those
figures, though, in the light of what The Sunday Times reported this morning.
It's got hold of a memo' that's been leaked to them from NHS administrator to
a big hospital in Liverpool, which says that pressures - which proves that
pressure is being applied on hospitals artificially to keep down the waiting
list because of the impression it's making.
DORRELL: Look, I'm not going to defend every
detail of every memo' that's written everywhere in the Health Service but I'd
simply rest, actually, on your admission and your question two or three minutes
ago. You said there has been a huge improvement in the Health Service
performance in respect of its waiting lists. I'm sure that is true, it's been
the experience both of clinicians working in the Health Service, of Managers
in the Health Service and of patients in the Health Service. And, it's-there-
HUMPHRYS: So, you acccept that they are-there is a
bit of fiddling of the figures going on, then?
DORRELL: It's - Any set of statistics, that's
collected across a nationwide picture - if you look at every single detail of
every element of those statistics - you can argue about the detail.
HUMPHRYS: Ah, but hang on, we're talking here
about specifically fiddling the figures. Look, it says - this memo, for the
benefit of people who haven't heard about the memo'. It's to Royal Liverpool
Broadgreen University Hospital, NHS Trust, and it talks about judicious
elimination of some patients from the official figures.
DORRELL: Yeah - and that's- I know it does and
that's precisely why - when you asked me about it - I said I'm not going to
defend every detail of every..
HUMPHRYS: So, you would condemn this memo'
and you don't want them to do that kind of thing in future?
DORRELL: I-I do not want Managers to fiddle
figures. I do want effective management of the waiting time that patients
experience in the Health Service and that is what we have delivered in the
dramatic reduction that you were good enough to acknowledge.
HUMPHRYS: So, you would condenm whoever sent that
memo' and tell them: don't do it again, we want the true picture to emerge,
without any feeling...
DORRELL: I've no idea what they meant by
judicious elimination. What I want-
HUMPHRYS: Bit sinister, though, innit?
DORRELL: What I want is effective management, so
that patients wait for an acceptable time on a waiting list.
HUMPHRYS: We are going to have to get used to
higher waiting lists again though, aren't we? The BMA is deeply worried about
this, amongst others
DORRELL: Well, as you-Let me put your own words
back to you. You said there's been a dramatic improvement.
HUMPHRYS: Well, that's only incontestable. I mean,
the figures are there.
DORRELL: It is 'incontestable' - I'm grateful to
you. That's it's incontestable.
HUMPHRYS: And, everybody acknowledges that there
has been a problem. But, that doesn't tell us that it is going to stay like
that. I went on to say the figures are - two things: 1) there's been a certain
amount of fiddling going on and 2) - by your own admission - and 2) they are
starting to creep up again.
DORRELL: Yeah.
HUMPHRYS: Now, what we're not concerned with here,
what has happened in the past - we've acknowledged that - what we're concerned
about now is what is going to happen in the future.
DORRELL: Yes and what I was going to do was to
remind you of your word creep up again, I acknowledge they have crept up,
they've crept up from a low of I think it was seven thousand to a low of
fifteen thousand, that's an increase of seven thousand. We've seen a figure
that used to be one quarter of a million, so my focus hasn't changed, my focus
is that we must deliver an acceptable service to patients in the waiting list,
that is to say that everybody should have the total assurance that if they are
on a waiting list they will be treated within eighteen months as a maximum,
actually for the overwhelming majority it is twelve months as a maximum and for
the great majority it is very much less than that.
HUMPHRYS: Jim Johnson, Chairman of the BMA's
Consultants Committee, wards and intensive care beds are lying idle, staff are
being dissipated, waiting lists are rising because absolute priority is to
limit, is to admit emergencies, now that is terribly worrying.....in some areas
he says has been completely stopped because people don't have any more money to
purchase, now this is a consultant who is a chairman of a very important
committee in the BMA.
DORRELL: Jim Johnson himself would say that the
first priority of the Health Service, of course, is to deal with emergency
cases and who would argue with that.
HUMPHRYS: It's a bit more than that.
DORRELL: Of course it does but the first
priority, priorities are putting a series of different objectives in order,
that's what it means and the first priority of course is to deal with
emergencies and it's quite true that elective surgery in a number of hospitals
was cancelled in the first two weeks of this year when we had very high
incidents of flu and we had a very cold spell, that placed enormous pressure on
the emergency services. Actually, the picture over the last couple of weeks
since it has been a bit warmer and the flu incidence has been falling is that
elective surgery is starting to move again.
HUMPHRYS: Let's have a look at the perception of
the NHS though because this is what's going to worry now as we come up to the
Election, you must have been concerned about that survey in the Nursing Times
which show that seventy eight per cent of nurses say there are staff shortages,
two thirds of them think patients are being put at risk - now that is the
reality from their point of view and these are people who work in the NHS
without at axe to grind.
DORRELL: They are also self selected people
responding to a survey.
HUMPHRYS: Well, come on, we are talking about a
very large number of people here.
DORRELL: We are talking about a survey
where..which was carried out by a magazine where people replied if they felt
they had a point to make, now what....
HUMPHRYS: .......entirely legitimate...
DORRELL: What of course I recognise that when
there is concern in the Health Service about the quality of service we are
delivering we need to respond to that, but if you go and talk both to the great
majority of clinicians in the Health Service and to the overwhelming majority
of the patients in the Health Service, what they will recognise is that
although there is a service under pressure and occasionally the service fails,
the experience of the overwhelming majority of patients of the NHS is that they
received better health care today than they've ever received before.
HUMPHRYS: Final quick thought about the future
then, long term people believe that no government can provide enough cash to
meet all the needs are we all eventually going to have some kind, have to have
some kind of private insurance.
DORRELL: No I don't understand the logic of that
argument, you see, that is to make our system more like systems on the
Continent of Europe or in the United States and if you go down that road
actually you can see clearly from those countries what the results are, the
result is that you deliver the same health outcome but you pay more for it, it
doesn't see to me an obvious way to go.
HUMPHRYS: Stephen Dorrell, thank you very much
indeed.
DORRELL: Thank you.
...ooOoo...
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