The Health Bill, privatisation, and workforce issues

This article was given as a speech to the Lancashire Association of TUCs on 14 August 2021 by Greg Dropkin, a member of Keep Our NHS Public

I’m going to talk about the Health and Care Bill mainly in relation to privatisation and the impact on the workforce, but will start with some background. The short version: the NHS is now in mortal danger after 40 years of attack. The latest Tory plan is opposed by Labour, but given their history, it all depends on what unions and communities do.


The idea of a universal, comprehensive national health service, publicly provided, publicly financed through general taxation, publicly accountable, free at the point of use with decisions taken on clinical grounds without reference to ability to pay, has been under sustained attack for decades.

Back in 1982, Thatcher’s Cabinet considered replacing the NHS with private health insurance, but rejected this as political suicide. But she managed to introduce competitive tendering so that hospitals would compete with the private sector for cleaning, catering, portering and laundry services; import hospital general managers from the private sector; and eventually separate the commissioning of health services from their provision, the so-called “purchaser-provider split”, a market mechanism.

During the 1990s, Major introduced PFI to build new hospitals at highly inflated costs using private finance. The scam was promoted by the Blair government, which also introduced competitive tendering for community services, private diagnostics, patient choice including a private option, privately run Independent Sector Treatment Centres for elective operations, and variations to the GP contract allowing private firms to run surgeries.

During the global financial crisis, Gordon Brown asked McKinsey Corporation to advise on how to reduce the NHS budget. McKinsey recommended:

  • annual efficiency savings to cut the cost of providing healthcare
  • reducing the treatments available on the NHS
  • moving care out of hospital to cheaper alternatives in the community

McKinsey are a US-based global consultancy, and helped draft the 2012 Health and Social Care Act passed by the Tory-LibDem coalition.

In 2012 Simon Stevens, a former Labour councillor and adviser to Blair who had become an Executive Director for the largest US healthcare corporation UnitedHealth, led a World Economic Forum workshop on the future of healthcare. In 2014, he was appointed as Chief Executive of NHS England and issued the Five Year Forward View, based on the World Economic Forum recommendations. Parliament never authorised it, but NHS England implemented the plan anyway to create Sustainability and Transformation Partnerships (STPs) and Accountable Care Systems, later renamed Integrated Care Systems (ICS).

The Health and Care Bill will give ICS formal legal status.


In February, the government issued a White Paper based on NHS England recommendations.

The Bill was eventually published shortly after Matt Hancock resigned. At the Second Reading, Labour tried to get it withdrawn and then voted against it. The Committee stage starts on 7 September and the Third Reading is expected in November.


The Bill is being spun as integrating care – an apple pie phrase – ending privatisation, and learning the lessons of the Government’s supposedly successful response to Covid. Some success! The lesson they learned was full co-operation with the private sector. This includes an expensive private Test & Trace system that did not work, even after a year, when cases and contacts of the emerging Delta variant could have been identified and isolated if the relevant local public health teams were told in time.

The “ending privatisation” spin comes from the repeal of Section 75 of the 2012 Act which required tendering of clinical contracts, but the Bill will actually expand private sector involvement.


The national NHS will be broken into around 42 separate systems, in areas like Cheshire and Merseyside, or Lancashire and South Cumbria. Each area will have two new bodies, an Integrated Care Board (ICB) and an Integrated Care Partnership (ICP). The ICB will manage the entire NHS budget for the area. Private sector reps may be appointed to the Board or its committees with delegated powers. Virgin is already on the Board of the informal Integrated Care System in Bath and North East Somerset. Local authorities are guaranteed one seat between them. The public may or may not get to ask questions.

NHS England will allocate the budget and appoint a Chair, subject to approval by the Secretary of State; the Chair then appoints a Chief Executive subject to the approval of NHSE. The ICB will make a binding plan for the NHS providers in the area. They will share the financial risk to meet budget constraints, and NHS England may intervene to limit spending. In other words, cuts.

Meanwhile, the Partnership will draw up a strategy, to which the ICB must have regard. The ICP will incorporate all the local authorities, and can appoint unspecified others. NHS England guidance mentions voluntary, community and social enterprise, social care providers and organisations with a relevant wider interest. That could be anyone.

Secondary and Emergency

Surprisingly, the Bill removes the requirement to provide NHS hospital care in each area, although primary medical care must be provided. The Secretary of State will have the option of designating those persons for whom the ICB has core responsibility as being those who normally live in the area. There is no longer any requirement to provide Emergency services for everyone present in the area, which is a current responsibility of CCGs. How would that work? Someone from Kent has an accident in Preston, but the Lancashire & South Cumbria ICB budget may or may not cover their emergency care.


Aside from the Board and committees, the NHS will be opened up in other ways:

  • Payment Scheme: In deciding the budget for each system, NHS England will consider the cost of treatments and services they expect it to deliver. Those costs will be set by a new Payment Scheme, with prices which vary according to where, by whom, and to whom the treatment or service is given. NHS England must consult on the Scheme with anyone who provides health care services for the purposes of the NHS, or the Secretary of State’s public health functions. For example, Sexual Assault Referral Centres are a public health function. Some SARCs are run by G4S, who must be consulted on the Payment Scheme.
  • Procurement: The Bill will allow contracts to be awarded without open tenders. Since May 2020, over 4700 covid contracts worth £38 bn were handed out, many without procurement, some to politically connected firms with no relevant experience. As the Explanatory Notes reveal, any tenders involving clinical services, including mixed bids with a clinical component, will be exempt from the Public Contracts Regulations 2015. That doesn’t end privatisation, it replaces a regulated market by an unregulated one, without the safeguards for compliance with environmental, social and labour legislation including ILO conventions such as freedom of association and the right to strike, or the right to examine whether the bidder could deliver. The Bill scraps these safeguards.
  • Health Systems Support Framework: Over 200 organisations, almost all of them private companies, are accredited by NHS England to support the development of Integrated Care Systems. McKinsey, Optum – an arm of UnitedHealth – IBM, Cerner, are some of the 30 US firms involved. They provide health insurance or supply consultancy and data services to the insurance industry.
    Operose is the UK arm of US health insurance and data analytics giant Centene. Operose controls dozens of GP surgeries in England, and its former CEO Samantha Jones now advises the Prime Minister. The Health Systems Support Framework accredits Operose for Population Health Intelligence, Development of Service Change and reconfiguration proposals, Organisational redesign, governance, payment and contract reform, Workforce and leadership support, Personal Health Budgets and Integrated Personal Commissioning etc.
  • Data sharing: The Bill intends a massive shift towards digital services and sharing information. The notes explain “NHS Digital may only share information for purposes connected with the provision of health care or adult social care or the promotion of health” which sounds good. They then say “This could include for example commissioning, planning, policy analysis and development, population health management, assessment of the quality of services and individuals’ experiences of them, workforce planning, research for purposes which benefit or are relevant to the provision of health or adult social care and developing innovative approaches to the delivery of health and adult social care.” These are all topics in the Health Systems Support Framework. NHS data could be shared for these purposes with Operose, owned by Centene.

How about the workforce? 


Flexibility is a buzzword in the Bill, without much detail. But NHS England guidance issued in June says the ICS should:

“Develop new ways of working and delivering care that optimise staff skills, technology and wider innovation to meet population health needs and to create flexible and rewarding career pathways for those working in the system. This should be enabled by inclusive employment models, workforce sharing arrangements and passporting or accreditation systems.”

“Inclusive employment and workforce sharing” sounds like shunting the worker from one employer to another, or sharing them between different employers. You don’t need a “passport” to move between different sites of the same employer.

In January NHS England said these employment models would enable the workforce to be “deployed at different sites and organisations across (and beyond) the system, sharing practical tools to support agile and flexible working”.

All this flexibility will interfere with union organisation, demoralise staff, reduce continuity of care, undermine local knowledge and team working, and require more travelling, so be bad for the environment as well as staff.


The Secretary of State will have the power to deregulate particular professions, and to abolish or merge regulatory bodies. The White Paper explained that “over time and with changing technology the risk profile of a given profession may change and while regulation may be necessary now to protect the public, this may not be the case in the future.” The Government seem to think that a health professional using algorithms and expert systems may not need regulation.

But all computer systems can crash. Expert systems require continual reassessment when they come up against reality. If certain health workers are no longer regulated, they will no longer be trained to the same standards, and may not recognise when the computer is wrong. They may be unable to cope when it crashes.

Deregulation will interfere with how staff develop their skills. Why would the ICB budget include specialist training if the job only needs a computer programme?

But deregulation fits with down-banding existing jobs and creating new jobs, such as nursing and physician ‘associates’ – which are paid less.

Mergers to reduce the number of regulators will mean fewer staff to cover the same tasks, so oversight cannot be carried out in full.

Deregulation is dangerous for patients and staff.

Agenda for Change

The Bill does not mention national agreements on pay, terms and conditions including Agenda for Change which covers staff subject to the Pay Review Body, now being offered 3% after risking their lives through the pandemic.

The Bill does mention staff directly employed by the ICB. These will include staff currently employed in the Clinical Commissioning Groups. The Bill says:

“Employees of an integrated care board are to be paid such remuneration and allowances as the board may determine. Employees of an integrated care board are to be appointed on such other terms and conditions as the board may determine. An integrated care board may pay or make provision for the payment of such pensions, allowances or gratuities as it may determine.”

When Rachel Maskell MP asked about this during the Second Reading, the Health Minister Edward Argar replied that “it was not the intention that ICBs depart from Agenda for Change”. No guarantees though.

But there may be a much greater threat.

Each ICB will try to cut costs as NHS England can intervene if they think the system is overspending. Staff costs are the biggest single item for all the NHS providers within the area covered by the ICB budget.

The Payment Scheme will influence the budget allocation. But in the Scheme, the same procedure can have a different price in different areas, or if carried out by different providers, or for different patients.

This will be an economic pressure on the ICB to break from national agreements as costs will vary around the country.

When South West employers tried to introduce local pay in 2012, the regional NHS England did not object. A spokeswoman said “We are aware that some employers are considering working more collaboratively in order to ensure that their pay frameworks represent best value for money… the Strategic Health Authority continues to work with employers and trades unions in applying national terms and conditions where employers do not have the freedom to develop their own.”

The Bill gives employers that freedom.

Local pay would weaken the principles of equal pay for equal work. It could also drain staff away from poorly funded areas, threatening patient care.

Unions should press the Government on these potential threats to the national agreements.

I’ll finish with the Bill’s direct threat to patients.

Discharge to Assess

The Bill revokes requirements in the Care Act 2014 for local authorities to carry out social care needs assessments before a patient is discharged from hospital… This will promote an approach known as ‘discharge to assess’ ”. In other words, find out if the patient can cope at home or in a care home after sending them there.

NHS Consultant and President of the British Geriatric Society David Oliver wrote about it in the BMJ last September. He discussed the criteria in NHS England guidance on the ‘discharge to assess’ model. “The use of such criteria gets dangerously close to systems where insurers call the shots on how long patients are “allowed” to stay in hospital… The model also pushes problems out of hospitals and on to community services and primary care. Beyond six weeks after discharge, it will create further demand for social care in a system that is already struggling for resources and staff… The criteria ignore many other valid reasons for staying in hospital a little longer. Examples include stress or ill health among carers, and an infectious disease that could infect others in the care home or community hospital. Above all, the judgment as to who really is “medically optimised” enough to leave, and whose support arrangements at home are sufficient at that moment to give us confidence, is best made by the clinicians who are with that patient and their family daily and who know the circumstances and concerns… When things go wrong, any formal complaint or coroner’s verdict, or any negligence claim, will be answered by clinicians, not NHS England officials.”

What you can do

The Bill is so full of flaws, our aim must be to scrap it entirely. Even if we lose, we must make clear to everyone what this is all about and why we are fighting it, to lay the basis for any future strategies.

Alerting all unions, not just in the health service, is a priority. This means seeking policy commitments at regional and national level, along with education at branch level.

If the 3% pay offer is rejected and health workers move into dispute, I hope that opposition to the Bill can be raised alongside the pay campaign. Back in 2011, the failure to join the public sector pension strikes to opposition to the Lansley Bill was one reason we ended up with his Health and Social Care Act.

I also hope that you can find ways to raise these issues with MPs. I suspect that many do not actually know the details, whether they voted for the Bill or not. The more pressure they feel from below before the Third Reading, the better.