Splish Splash Splosh!

Does anyone have a clue where we're heading?
Halfway across a severely swollen river is not a good time to let the tiller go. But that of course is precisely what Cap'n Alan Johnson is doing on the good ship NHS. Whereas Commissar Hewitt had it hard about, Cap'n Al has let it go all floppy.

Yesterday he told the Health Select Committee he was junking one of the Commissar's most cherished but highly contentious policies:

"I don't believe there is the need for another independent sector treatment centre [ISTC] procurement and there won't be a third wave.

We will instead move towards greater local determination."

On one level this is good news for taxpayers. The contracts with these ISTCs have been classics of the Simple Shopper's art, with taxpayers being required to pay whether or not the NHS actually uses the service. Their total cost is £1.7bn, they are on average 11% more expensive than their NHS equivalents, and 20% of their paid for capacity is not used. Brilliant. (Also see here for details of the £1m paid to a Chesterfield ISTC for orthopaedic operations not carried out because patients chose to use existing NHS services).

As we know, the whole DoH programme to get more private companies involved in healthcare has been a shambles of overpayment and poorly designed contracts. Taxpayers have paid through the nose, even if the services are not used or actually fit for purpose.

The scandal of hospital cleaning shows just how bad things can get when you try to manage top-down via boilerplate contracts: with nobody directly in charge on the ground, the critical business of real hygiene on the wards in the hospitals has simply fallen down the dirty cracks in between (eg see here for latest on C.difficile crisis).

And let's not forget the great money pit that is PFI. When last sighted, the 83 PFI hospital contracts were set to cost us £53bn over the life of the contracts, compared to an actual value of facilities of just £8bn. Indeed, private sector refinancing profits have been so munificent that even the normally placid PAC Chairman couldn't stop himself spluttering about the "unacceptable face of capitalism" (see this blog and others for details on the mega refinancing gains made by some PFI players).

So Johnson's been put in to stop the whole thing- private money, contestability, reform, it's all systems stop.

Obviously the unions are delighted (although not so delighted about the grim outlook for their future pay rises). But should we taxpayers also rejoice?

The answer of course is no. We're locked into a whole load of expensive contracts designed to support a more open NHS, but Johnson is junking the programme before we've actaully seen any of the promised benefits.

Our once in a lifetime opportunity to reach the other shore of real choice and competion has been lost. Taxpayers may be spending £105bn this year on health (over £4,000 per household), but effectively the money's run out. 80% of Labour's increased spending has been frittered away on increased costs.

The Tories- even in the increasingly unlikely event they got re-elected- have already bottled out of the radical choice policies that would offer real reform. So there's absolutely nothing else on offer.

We're back to drifting downstream.

As we've said before, if you can possibly afford it, get yourself private health insurance.
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