Staff fight to stay 100% NHS: New round of battles against ‘Subcos’

Bradford staff dig in for another strike. They believe pay and pensions will suffer as part of a drive to cut costs if roles are transferred to a wholly owned subsidiary company (Subco), being set up by the trust.

This article originally appeared on Health Campaigns Together
These companies don't have to honour NHS contracts and are free to pay employees less than NHS staff doing the same jobs, creating a damaging two-tier system that's no good for staff or patients, says UNISON.

The NHS works best when staff all belong to the same team which is why members want to remain in direct NHS employment.

Essentially these companies have been set up to exploit a VAT tax loophole which permits companies the ability to reclaim tax on goods and services which is otherwise not permissible in the NHS.

UNISON's research into approximately 30 NHS subsidiary companies shows the extent of creeping privatisation, as we have seen many services like Community Nursing, occupational therapy, physiotherapy, Procurement & Finance, admin services, medical physics, corporate services, health & safety, pharmacy, pathology services, IT services, personnel services, etc transferred out of the NHS into these companies.

The August strike follows a week of industrial action in July that saw workers come together with the local community to oppose the backdoor privatisation of health services across the trust.

UNISON general secretary Dave Prentis said:

Staff are taking this action to ensure the NHS keeps its highly motivated and committed workforce together, working for the people of Bradford, not for the directors of a private company. It doesn't reflect well on the trust that staff who are proud to be part of the NHS have to take to the streets to convince the trust that patients and staff come before profits.

Bradford UNISON health branch has launched a crowd-funding appeal, which points out that:

These plans affect the lowest paid frontline staff in the NHS who will not get paid by the Trust for taking strike action. Many work part time including single parent families so taking strike action has been a very difficult decision. This strike fund is to support the lowest paid NHS frontline staff (£9.p.h) for whom a day's wage is the difference between paying the rent, paying the bills and putting food on the table so please, please give generously. Please donate funds ASAP so that we can provide support for the action already taken and for the further action that is to be taken.

Prior to this, during summer 2019:

Link up to beat back the Subcos!

Unions are still working together to protect NHS workers under threat from being outsourced to new “Wholly Owned Companies” or “Subcos.” These are the latest idea from cash-strapped trust management trying to cut costs of support services by dodging VAT liability. They are also seeking to make “savings” from paying inferior terms and conditions to new employees, potentially establishing a 2-tier workforce.

The number of subco plans are still growing, but the fightback is strengthening, drive forward by recent successes. In early July unions at Wigan Wrightington and Leigh Foundation Trust scored a victory after several spells of solid strike action.

Wigan Council stepped in to buy a settlement by offering a £2m handout to cover the “savings” that NHS bosses had hoped to generate from their subco “WWL Solutions”. This enabled trust and unions to agree there was no need to proceed with the subco or with the further prolonged strike called for July 17.

Mid Yorkshire Hospitals unions have also forced a retreat from their trust board which has put their subco plans on hold – and the unions delayed their strike, warning that they have a mandate from a 97% ballot vote for action any time up to December. The trust’s business plan (see our right hand column makes clear (page 19) that the drive to dodge VAT and seek other savings arises largely from the long-standing inflated costs of the Trust’s PFI contract for Wakefield and Pontefract hospitals).

NHS trusts in several parts of the country, but most especially the South West, North West and Yorkshire, have since the second half of 2017 been looking at transferring non-clinical jobs into the new subsidiary companies.

Unions have warned from the outset that even if transferred staff are at first covered by TUPE regulations that appear to protect their terms and conditions, such moves can swiftly undermine them, and may well employ subsequent staff on separate terms inferior to the hard-won national Agenda for Change agreement.

This latest fragmentation (at a time when NHS England is continually talking about “integration”), is likely also to affect patient care by adding yet another management structure, and making it even harder to recruit and retain the necessary workforce to maintain standards.

Health Campaigns Together is eager to work with union branches and regions in the fight to stop this latest attack on the unity of the NHS. We share the unions’ concern that even companies that begin as “wholly owned” subsidiaries of Trusts will immediately be outside the NHS and could later evolve into partnerships with the private sector, or be sold to private for profit companies.

This page brings together information on subcos to enable branches to strengthen their awareness and campaigning, and ensure stewards and activists have the most up to date information.

We urge branches to contact local campaigners who can help to develop broad-based and popular local campaigns confronting NHS Commissioners, Trusts, and local councillors and MPs. If your branch wants any assistance in finding nearby campaign support, please contact us at [email protected].