Grant Shapps (Welwyn Hatfield) (Con): I originally wanted to call the debate, "Financial crisis in Hertfordshire hospitals" but a wise-looking man in the Table Office said that only the Government can declare a crisis in this country so I had to resort to calling it merely, "Financial deficit in Hertfordshire hospitals". However, if one were to ask my constituents, many of whom are watching the debate, it is a genuine crisis.

In Welwyn Hatfield and Hertfordshire, circumstances developed that led to an acute hospital, which was responsible for all manner of health care, becoming little more than a community or cottage hospital. It all started approximately six years ago, when the original two trusts merged to form a single East and North Hertfordshire NHS Trust. At that time, we were reassured beyond doubt that it was simply an administrative merger that would make the trust's running costs much lower.

Time went on and we found that the Tewin children's ward was being closed down. To our surprise and without notification, the ward was initially closed at weekends, and then permanently, so that people who would otherwise use the Queen Elizabeth II hospital in Welwyn Garden City were expected instead to take their children 14 miles up the motorway to the Lister hospital in Stevenage. That might have been okay if, as we were promised, the paediatric assessment unit had remained open for the first 24 hours of stay. However, constituents learned with some surprise last year that the paediatric assessment unit would also be closed at night, leaving a PAU in place only in the daytime.

Far worse and much more specific, the deficit of some £49 million in Hertfordshire health care this year has compounded matters so that, in East and North Hertfordshire NHS Trust, a rescue plan has been put in place. It is always said that it is bad news when the experts are called in to talk about how to make further cuts, and so it was when PricewaterhouseCoopers came to the East and North Hertfordshire NHS Trust to explain how more money could be saved to try to right the deficit that had got out of control. A deficit amounting to £49 million over the next three years has been projected. As a result, in addition to losing the children's ward and the night-time operation of the paediatric assessment unit, we are now to lose all children's services during the day, all our blue-light accident and emergency services, and all our maternity services. My twins, Tabytha and Noa, who were born there just 20 months ago, will be among the last children to be born at that hospital because the maternity services are to close. That is not all. All operational activity is to cease. There will be no further operations if the restructuring plan is put in place.

The list goes on, and it is an extensive one. Similar situations are being experienced by my colleagues around the country. This is all in the name of recovering

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from a financial deficit that is simply going to put lives at risk in Welwyn Hatfield and other parts of Hertfordshire.

Mike Penning (Hemel Hempstead) (Con): Does my hon. Friend agree that it is a disgrace that these cuts are being implemented for reasons not of clinical need but of financial mismanagement?

Grant Shapps: My hon. Friend is right to pinpoint that issue. When the children's services were first being closed, the bosses of my NHS trust made it sound as though the cuts were all to do with clinical outcomes. Now, however, they do not even pretend that that is the case. They simply say, "We must cut this deficit." The carrot that they hold out in regard to these significant cuts to hospital services is that one day, somewhere along the line—perhaps in about 2013—we might get a hospital in Hatfield. A £550 million private finance initiative project has been on the cards for some years, yet as it supposedly gets nearer, the completion date gets further away. It is three years since the project was announced, yet its completion date is now three years further away.

We learned this morning from the front page of The Times that certain multi-billion pound PFI schemes are likely to be scrapped. When we put the Hatfield scheme into that context, we realise that it is worth more than £500 million and that, so far, PFI has paid for only £2 billion of investment in total, so this project represents a quarter of the entire PFI budget to date. This morning, we found out that projects worth a further £12 billion are among those that Ministers are reviewing. I ask the Minister this evening whether she can confirm that the Hatfield PFI project was included in those projects that might not now happen.

I understand, because I am in close contact with the health bosses in my local trust, that the problems there are systemic and that they go back many years. Every year for the past six years, there has been a need for interim funding to the tune of £15 million to £16 million, year on year. I put it to the Minister that that is not simply a question of a local health trust spending money badly, although there might well be some of that involved. This is the story of the county of Hertfordshire, which simply does not get the per capita spending that it requires.

Mr. David Gauke (South-West Hertfordshire) (Con): My hon. Friend has mentioned a systemic difficulty in his part of Hertfordshire, and I can confirm that we have similar problems in west Hertfordshire. I should like to elaborate on the point made by my hon. Friend the Member for Hemel Hempstead (Mike Penning) about the fact that the proposed cuts are driven purely by financial rather than clinical need. My hon. Friend the Member for Hemel Hempstead and I met the chief executive of the West Hertfordshire Hospitals NHS Trust shortly after the general election and made it absolutely clear that we believed that the cuts were being driven by financial need. I fear that my hon. Friend the Member for Welwyn Hatfield (Grant Shapps) faces the same problems.

Grant Shapps: My hon. Friend is exactly right. West Hertfordshire has similar problems driving similar, rather draconian solutions, which mean cuts in services to local people.

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Let me ask the Minister a simple question. How will a trust that has run up such deficits over the past few years, that thinks that its problems are probably systemic—that additional funding is simply needed on a per capita basis—and that is in so much financial difficulty today, ever be able to afford a repayment on half a billion pounds of extra debt? I am sure that she will explain to me a list of facts of figures, and I understand and welcome the fact that more money has gone into health care. I do not welcome the fact that that money is not getting through to the front line, however. In our local health care economies, our hospitals are suffering cuts. My hospital is suffering really sharp, deep cuts that are making a horrendous difference to people's lives. It is no good listing how many extra doctors, nurses and consultants there are in Welwyn Hatfield and our part of Hertfordshire if there is no hospital for them to work in. That is the simple problem that we face.

I would wager that the money has gone into all manner of different areas. We know, for example, that the consultant and GP contracts have been expensive to fulfil. We know that the 1 per cent. on national insurance hit no organisation in this country harder, in an attempt to help the health service, than the health service itself, which paid that 1 per cent. We know that money has gone into various layers of bureaucracy. When constituents write to me to ask why they have not had an operation, I often have to refer to a ladder including the Secretary of State for Health herself, the regional health offices, the strategic health authorities, the primary care trusts, the NHS acute trusts—the list goes on. There are simply too many layers involved in the process.

If somebody has a heart attack in Hatfield, for example, and they are expected to be driven in, for whatever reason, a private car 17 miles up the motorway to Stevenage, they will find that the motorway is clogged at rush hours, as it is every single day. It is impossible to see how we will get emergency care to that constituent on time. We are reaching a life and death situation.

Mr. Graham Stuart (Beverley and Holderness) (Con): Is my hon. Friend aware that it is not just constituencies such as his that are affected? In extremely rural constituencies such as mine, the financial deficits in the NHS and the failure of money to reach the front line is leading to cuts and threats of closure to community hospitals on which the old, vulnerable and poor most depend. That crisis affects the whole NHS, across the whole country, not just Hertfordshire. Will he congratulate the more than 60 campaigners from across the country who attended the Community Hospitals Acting Nationally Together conference today, held jointly with the Community Hospitals Association, to work to change the Government's mind?

Grant Shapps: I concur completely with my hon. Friend's comments and I congratulate him on his work with the CHANT programme, which has been impressive. I have a word of reassurance for him—the Government are in the process, certainly in Hertfordshire, of turning acute, major, general hospitals into nothing more than community hospitals. I know that community hospitals do a wonderful job, but I am afraid that an extra hospital will be joining his CHANT group because of those closures. That is a huge worry—

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I mean no disrespect to my hon. Friend and his organisation. We need an acute hospital in our area, and we have the pledge of a new hospital.

Given the way in which the situation is developing in our part of Hertfordshire, does the Minister think that the problem lies with the local health chiefs who are somehow spending the money inappropriately, or is it the fault of the Government? Who is to blame for what is going on? Will she give us a categorical assurance that the funding of the Hatfield hospital project will go ahead? Can she reassure us that it is not part of the cuts mentioned in today's newspaper—the go-slow on £12 billion of PFI projects? Is Hatfield caught up in that number? How many people will have to die on the way to hospital before the Government realise that we on this side of the House are not simply scaremongering about the dangers and risks faced by our constituents? This is for real, so will she tell us when the Government plan to get a grip on the situation?

10.15 pm

The Parliamentary Under-Secretary of State for Health (Caroline Flint): I congratulate the hon. Member for Welwyn Hatfield (Grant Shapps) on securing the debate and I will try to address the points that he has raised, which are clearly of concern to him and to other hon. Members. I would also like to pay tribute to all the NHS staff in his constituency and elsewhere in Hertfordshire who are committed to the improvement of the local NHS.

From what I understand, there has been a debate in recent years in the area about how services might be improved for the future, part of which has been about the hospitals and what they have provided and can provide in the future. I will go through some of the new provision that is available in a number of the different hospitals in Watford and elsewhere.

There has also been a debate about what services are needed outside of hospitals and closer to where people live, as part of a more community-based approach to providing health services. That debate is taking place in Hertfordshire and up and down the country in recognition of the quality that can follow those community-based services and of the fact that they can sometimes represent better value for money, efficiency and quality in terms of health care. As the Minister with responsibility for public health, I am keen on preventing people from going into hospital.

The NHS as a whole, as the hon. Gentleman is aware, is in receipt of record resources because of the Government's policy of funding the NHS. The 2003–04 to 2005–06 revenue allocations to primary care trusts represent £148 billion of investment in the NHS. Over the three years covered by the allocations, PCTs will receive an average increase of 30.8 per cent. The most recent round of revenue allocations, covering 2006–07 and 2007–08, represents £135 billion investment in the NHS, a huge amount. Over the two years covered by this allocation, PCTs will receive an average increase of 19.5 per cent.

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Mr. Graham Stuart: The Minister, in the style of all Ministers of this Government, runs out the figures, but why are so many primary care trusts in deficit? Why are they expecting to go further into deficit this year while getting that increase?

Caroline Flint: The trusts in deficit are in a minority in the NHS. Most are balancing their books and achieving good quality outcomes from less money than is sometimes provided in areas that are in deficit. It is important to ask that question. We are addressing the issues in different ways—by payment by results and so forth—but there is a question about why, in some of our poorer neighbourhoods where the health inequalities are very clear, we are getting better value for money in delivery of health care than in other areas. As a direct result of the allocation, the hon. Member for Welwyn Hatfield's local PCT received £98.5 million in 2005–06 and will receive £119 million in 2006–07 and £129 million in 2007–08.

Grant Shapps: I am pleased to hear about those increases for the PCT but does she accept that the problem in Hertfordshire is with the NHS acute trusts and not the PCTs, who are running in balance? The trusts are massively in deficit, by £43 million.

Caroline Flint: I appreciate that but that is another reason why these trusts have to be brought into balance, as there can be knock-on effects in terms of primary care delivery. Therefore, primary care trusts who oversee this area in terms of spending obviously are mindful of what is provided in the hospitals, but are mindful also of what they want to fund in the community.

The hon. Gentleman will agree that, as I said earlier, a number of services could be provided outside of hospitals. Indeed, a number of services could help in the long, medium and short term to prevent people from turning up in hospital. There is accident and emergency provision in the hon. Gentleman's area, but decisions have been taken as to who should provide a blue-light service and who should not. But as I understand it, that does not mean that that there is no 24/7 accident and emergency coverage in his area.

Collectively, the eight Hertfordshire primary care trusts receive huge allocations. They received in excess of £858.5 million in 2005–06—a figure that will increase to £1.1 billion in 2007–08. Given such investment, all NHS bodies should be able to plan for, and achieve, financial balance each and every year. I should point out that the majority of NHS organisations are both delivering service improvements and living within their set budgets, but we recognise that a minority of organisations face challenging financial agendas. The Department and the strategic health authorities are trying to work with them to help restore financial balance.

Turnaround teams have been set up to support the NHS in identifying opportunities to deliver services with greater cost-effectiveness and to make financial savings. The teams consist of financial and management experts who are experienced in resolving financial problems and helping organisations to manage their resources better. West Hertfordshire Hospitals NHS trust, and East and North Hertfordshire NHS trust, have built on the work already commissioned by the SHA by undertaking

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baseline assessments and by bringing in PricewaterhouseCoopers to help address some of the financial difficulties that they face. A meeting took place on 10 January. The SHA received feedback from the turnaround teams' work and it is reviewing the results.

Before I discuss efficiency savings and the recovery plans, I want to point out that, despite the issues raised by the hon. Gentleman, there have been some significant developments in the county in terms of supporting new ways of addressing the provision of health care. For example, the Watford health village project, which will lead to the redevelopment by early 2013 of Watford general hospital and the immediate surrounding area, is proceeding well. One partner, the East of England Development Agency, recently agreed to contribute £750,000 over the next two years to pre-planning work for this scheme. The Bedfordshire and Hertfordshire postgraduate medical school, based in Hatfield, opened in September and will enable local NHS organisations to attract support and to retain the best talent in the region.

Through the surgery centres project, most elective surgery in Hertfordshire will take place in new, dedicated centres on the Hemel Hempstead and Lister hospital sites. The project is progressing well. Lister's £2.3 million cardiac suite was funded through the national lottery New Opportunities Fund and through the local NHS funding that we provided. It opened to patients in September 2004, and in its first year alone it cared for some 1,500 people from throughout east and north Hertfordshire. There is a new combined breast cancer and magnetic resonance imaging unit at the QE2 hospital, and the revamped Hertford county hospital was officially opened on 9 September. It will provide a range of services and open its doors to local people to provide a range of treatments. The capacity being built through those developments is doubtless welcomed by MPs throughout the county.

Mike Penning: It is all well and good saying that new units are opening here and there, but the Government are closing units to fund them. They talk about opening a cardiac unit, but they are closing the cardiac unit in Hemel Hempstead. The brand new stroke unit will close to fund the developments to which the Minister refers. So you are not giving anything new to the people of Hertfordshire; you are taking it away and handing it out somewhere else.

Mr. Speaker: Order. The Speaker never takes funds away from anyone.

Caroline Flint: We have given many new opportunities to the people of Hertfordshire, which is why waiting lists are down. People used to wait years for operations; now, waiting lists are at record low levels, and there are more doctors and nurses in the county. Discussions have taken place as part of examining future health; indeed, there was a huge consultation on how hospitals could be redeveloped. I understand that there was widespread support for the proposals. They were supported by cross-party representatives, local people and local groups. Even the local media recognised how important is the opportunity of having a new hospital.

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On the question about the private finance initiative, of course it is right that the Department should keep the hospital PFI programme under constant review to ensure that it delivers value for money. A number of PFI schemes are reaching a critical moment in the contracting process and are being subjected to the sort of detailed scrutiny that the public would expect of a major procurement project. That does not mean that there is a freeze on hospital PFI projects. We have just given two NHS trusts—Oxford Radcliffe and Portsmouth Hospitals—the go-ahead for construction. Obviously, the issue is kept under review but we continue through the initiative to deliver the biggest hospital building programme in the history of the NHS.

Mr. Stewart Jackson (Peterborough) (Con): In my constituency, the difference between the outline business case and the current costs estimate for the PFI project is 82 per cent. Can the Minister give me a cast iron guarantee that where an outline business case has been received for a new project, it will be honoured by the Government and the project will come to fruition, as my hon. Friend the Member for Welwyn Hatfield (Grant Shapps) also said?

Caroline Flint: As I said, we keep these areas under review to make sure that they are providing good value for money. The issues are also discussed in the local trusts and there is obviously huge discussion and liaison with the Department.

Mr. Oliver Heald (North-East Hertfordshire) (Con): In North-East Hertfordshire, we are putting up with a great deal on the basis that there is the prospect of the new hospital project coming on stream. Is the Minister saying that there is a question over that?

Caroline Flint: Not at all. I was asked directly whether a decision had been made about whether the PFI programme would go ahead. I think that I was quite clear. We keep the whole PFI programme under review. There is not a freeze on PFI hospital projects. We have just given two projects the go-ahead in different parts of England. Obviously, we are still keen to keep on track with the biggest hospital building programme in the history of the NHS. I have to say that, partly, the need to address the problems that we face, and to provide more doctors and nurses and better environments for health professionals to work in, is a legacy of previous Governments who failed to provide the sort of hospitals and health care that both treat illness and prevent people from getting sick in the first place.

Grant Shapps: Will the Minister give way?

Caroline Flint: I have three minutes left and would like to say something about efficiency savings and recovery plans since that was the main focus of the hon. Gentleman's debate.

Bedfordshire and Hertfordshire strategic health authority is working closely with the East and North Hertfordshire NHS trust and the West Hertfordshire Hospitals NHS trust to see how to deliver the efficiency savings needed to address the deficits incurred. They have to be addressed. It would be unfair to the those in the rest of the NHS who are achieving balance if we did

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not ensure that that happens. West Hertfordshire plans efficiency savings of £12 million a year between now and 2008–09. I understand that it will consider issues around improving clinical efficiency, which is expected to deliver savings in the region of £4.3 million. There are examples of better ways of providing clinical services; in an Adjournment debate recently, for example, one of my colleagues described how one consultant was doing as many operations as two had done by addressing the turn-around in orthopaedic surgery.

Grant Shapps: Will the Minister give way?

Caroline Flint: I will let the hon. Gentleman intervene because it is his debate, but will he bear with me for a moment?

Non-clinical efficiency is expected to deliver savings in the region of £3.5 million. Organisational changes to make sure that people are fit for the jobs they do will deliver around £3.6 million. In addition, maximising income on work undertaken on both NHS and private patients is expected to generate income in the region of £600,000, which will help to offset the deficit.

Grant Shapps: In the short time that we have left, can the Minister tell me and my constituents, many of whom are here tonight, whether the so-called reconfigurations—cuts to us—will cost lives in Welwyn Hatfield?

Caroline Flint: It is important that health trusts manage a proper service that takes account of the finances, use the record investment that we have provided to invest in services and, importantly, look at how they can deliver a better health service, including preventing people from ending up in hospitals with sicknesses that could be dealt with outside and doing

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more to prevent them from becoming sick in the first place. In that sense, the debate that is happening in the hon. Gentleman's county is a way in which we can look to not only save lives in the future, but ensure that those who become ill receive the services that they need, sometimes in hospital, sometimes closer to home and sometimes through different service provision. That is an important part of how we create an NHS fit for the 21st century.

In terms of future investment and development in the area, the proposed changes and efficiency savings are linked to the reconfiguration of services. It is about looking at where we can save money to invest in the future, as well as dealing with the deficit. There are questions to be asked about how a minority of trusts have got into deficit and how they can contribute to getting themselves out of that situation. The Department and the strategic health authorities are working strongly with those organisations to help them to make changes and turn the situation around.

It is important to recognise that services are not only about hospitals, but about primary care and intermediate care. A range of services needs to be provided, both inside and outside hospitals, to meet the needs of local populations. I know that the SHA is committed to achieving financial balance across the whole of its health economy. It is preparing the outline business cases for its 10-year plan "Investing in Your Health" for health services in both counties. It is my understanding that the whole ethos of that project is to ensure that health services are made available to people in both counties. It is not about winners and losers. It is about ensuring that the NHS—

The motion having been made after Ten o'clock, and the debate having continued for half an hour, Mr. Speaker adjourned the House without Question put, pursuant to the Standing Order.


Adjourned at twenty-eight minutes to Eleven o'clock.
 

Promoted by Amanda Perkins on behalf of Grant Shapps, both of Maynard House, The Common, Hatfield, AL10 0NF