Alan Milburn – 2002 Speech to the NHS Alliance

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 17 October 2002.

In just four years the NHS Alliance has become a force to be reckoned with. In Mike Dixon and his colleagues you have leaders who not only champion change but who argue the cause of primary care.

And today I want to set out to you how I believe primary care can lead the reform and reshaping of health care in the whole of our country. Whatever the problems there are in primary care – and I know they are real – there has never been a better opportunity for primary care – than we have today.

Our country’s family doctors are the backbone of the NHS – and the service they provide is not just valued by patients in this country it is envied in other countries across the world. So when some newspapers imply that the NHS is full of bad doctors let us just so this: it is full of good doctors doing their best for patients. And good nurses, therapists, administrators and professionals helping provide care for one million patients every day. I believe it is time that we as country said that we are proud of the work that you do. As a nation we owe you an enormous debt of gratitude.

People in primary care are working under real pressure but you are delivering real progress. In recent years you have helped chalked up significant achievements in which all parts of the service can share.

In primary care itself where waiting times are coming down. Where 3 in 4 patients can now see a GP within 2 working days. Where the growth in prescribing of cholesterol-lowering drugs is contributing directly to reduced deaths from heart disease.

In hospital services too, there is progress. A year ago people could wait up to 18 months for their hospital operation. Today, the maximum wait is at 15 months and coming down, moving towards the NHS Plan guarantee of a maximum 3-month wait. For cancer and heart disease, waiting times are coming down faster still – and most importantly of all mortality rates are falling too.

Of course huge problems remain. The pressures are real. Staff shortages are still there. Waiting times are still too long. But after decades in which the NHS was at best standing still and at worst going backwards the momentum is now forwards. There is a long way to go but I firmly believe the NHS has turned the corner. The NHS Plan is on course to be delivered. And we should now be confident that we can move up a gear.

This progress is all the more remarkable because it has been accomplished against a background of significant organisational change. Health authorities and Regional Offices have gone. Primary Care Trusts and Strategic Health Authorities are up and running. The transition has gone better than many feared. And that is thanks to you. Managers, clinicians, non-executive directors.

The NHS – with your leadership – can look to the future with confidence. No-one should doubt the significance of the next few years. It really is “make or break” time. Either we prove that the NHS can become a service where the interests and choices of patients always come first, or we reconcile ourselves to the fact that the NHS – great in principle – simply could not cut the mustard in practice in today’s world. Bold steps to radically reform the health service are now needed if we are to secure the improvements in health and health care that our country needs.

We should be confident first of all because the values of the NHS are right and indeed are more relevant than they have ever been. In a world where health care can do more – but costs more than ever – before, an NHS that is free at the point of use based on need not ability to pay – is the right way forward for Britain. With the NHS the health of each of us depends on the contribution of all of us. It gives the people of our country health care, not as a commodity to be bought and sold in a market but health care as a right we all enjoy as equal citizens in a fair society.

Frankly it offends against that principle when some propose as they do that the taxpayer should subsidise private health insurance so that those that can afford to pay in a voucher scheme get a fast-track to treatment ahead of those with a greater need but a smaller purse. The sick paying to be sick and the worse off paying for the better off could only create a two tier health care system that would be both expensive and divisive.

Such a proposal can only succeed if the NHS fails. So the stakes are high for all of us who believe in the values of the NHS. And here, although this is difficult we have to be honest with one another. For all its great strengths – its staff, its ethos of public service, the great advances it has brought in public health – the NHS has profound weaknesses too. Health inequalities have widened not narrowed. Too often the poorest services are in the poorest communities. Its centralised top down structure too often stifles local innovation. Staff too often feel disempowered. Local communities feel disengaged. And patients have little say and precious little choice.

Our job together is to remedy these weaknesses so that we can build on the NHS great strengths.

How do we do that? We do so in the first place by addressing the legacy of decades of under-investment not just in the health service but in our social services too. The Budget on April 17th marked a watershed for both. Social services will get twice as much next year as they are getting this year. And for the NHS it is worth remembering that while just six years ago funding was falling in real terms, by 2008 it will have doubled in real terms.

But when people are asked to pay more in tax to get more into the health service they will quite rightly want to see extra resources delivering real results. Not just improvements in services for patients but services that are responsive, where patients have choices, where quality always comes first. This is the challenge together we must now meet.

I believe that we are in a strong position to do so. NHS funding is secure. Progress is underway. There is a ten year NHS Plan with a major programme of reform to match the programme of investment.

It is these reforms that hold the key to delivery.

As both the NHS Plan and our more recent follow up command paper Delivering the NHS Plan made clear, it is right that standards are set nationally but wrong to run the NHS nationally. The job of government is to set standards and objectives that ensure equity in the provision of health care. Our job is not to run the NHS. Indeed a million strong service cannot be run from Whitehall. It’s got to be run by the local staff and held to account by the local community. That is something which the new strategic health authorities in their relationships with PCTs need to fully understand: PCTs need to be helped and enabled not commanded or controlled.

The more overall performance improves – as I am confident it will as the reforms and the resources bite – the more autonomy will be earned across the whole NHS. That is what I want to see. We are now at the start of a transition where more and more decisions will be taken locally rather than centrally. Where we move from a 1940s NHS – top down and centralised – to a more modern system where standards are national but control is local. Where those who are doing less well get more help and those that are doing best get more freedom. Reform cannot be achieved by holding on to the monolithic, centralised structures of the 1940s. We cannot reform by looking backwards. We need to look forwards. Reform means investing not just extra resources in front line services, but power and trust in those front line services.

I believe that process will now gather pace. From next April Primary Care Trusts will be in charge of three-quarters of the NHS budget, able to commission services as they see fit. The reason for this is simple enough. I don’t treat a single NHS patient. NHS staff do. Whitehall doesn’t provide care. That is what local hospitals, health centres and surgeries do. And that is where power needs to be located. On the frontline. It is time to unleash the spirit of public service enterprise that I know exists in so many parts of the NHS.

PCTs need to lead that process. And I want to help you do so. PCTs exist for two main purposes. One so that there is a local organisation holding the resources and the responsibilities to improve the health of the local population. And two, to commission care that gives local patients the services that are right to meet their needs.

I have often heard it said – even at this conference – this is all very well in theory but in practice the resources are already spoken for with too many national priorities, hospitals that drain all the investment and primary care that inevitably loses out. I want to take that argument on today – and to set out how, by working together, we can ensure that more not less services are provided in primary care and that PCTs are able to exercise real power.

So, while over the next few years there will be more money in PCT budgets there will be less ringfencing by central government of those local budgets. And in place of the current maze of annual agreements and duplicated plans, local health services will be able, as I’m sure Nigel set out this morning, to put together a single delivery plan for the medium term rather than the short term. These plans can focus on delivering improvements in the areas that count most for patients – waiting times (including in primary care), emergency care, cancer, cardiac, mental health, elderly and children’s services.

I can confirm today that when we allocate resources direct to local primary care trusts later this year they will get budgets not just for one year but for three. This will allow you to now plan with certainty to increase capacity over the longer term. Short term funding has hindered long term planning. Now you will be able to decide which local developments will take place when. And three year budgets will allow PCTs to decide longer term agreements with hospitals and with other providers.

Let us just be clear on this point: PCTs now have the explicit freedom to purchase care from the most appropriate provider – whether public, private, voluntary or not for profit. This is about redefining what we mean by the National Health Service. Changing it from a monolithic centrally run monopoly provider to a system where different health care providers work to a common ethos, common standards and a common system of inspection. In such a system wherever patients are treated they remain NHS patients because they get care according to NHS principles – treatment that is free and available according to need not ability to pay. This is the modern definition of the NHS.

And a modern NHS is one in which patients have power. And that means they have got to have choice. So that if their local NHS hospital cannot offer them a short enough waiting time but another hospital can they can decide to choose with the help of their GP. We have made a start by offering choice to heart patients. By the end of 2005 we aim to have all patients needing a hospital operation in every part of the country have a choice over the hospital, the time and even the consultant that’s best for them. And it will be family doctors and community nurses who can ensure that patients are able to make informed choices.

As NHS capacity expands so choice will grow. Resources will follow the choices that patients and PCTs make so that hospitals who do more get more; those who do not, will not. Making choice available for the first time on the NHS will strengthen PCT power to commission services that are in the best interests of patients.

And we want to help PCTs develop this commissioning role. At present I know that when it comes to negotiating contracts it can feel like the hospitals hold all the cards. But remember this – you hold all the money. And we want to create a more level playing field. We are planning to build up PCTs’ capacity to commission first through the national PCT development programme, then through the new NHS University. I want the NHS Alliance to be part of this process – so that every PCT in every part of the country has the information, the skills and the resources to get the best deal for patients. And when we start to introduce a common tariff system for hospital operations over these next few years it will take out of the local negotiations between PCTs and hospitals the very areas where you are weakest – on prices – and leave those where you are strongest – on quality of service and outcomes of care. PCTs need their local hospitals – but not at any price. Hospitals need to deliver – and PCTs need to demand the right standards of services

It is time PCTs stood up for themselves. I know that many feel honour bound to the local hospital. But the job of PCTs is to get the right services for patients. They need to flex their financial muscles and use their commissioning powers. The truth is that delivering shorter waiting times in hospitals – whether in A&E or for an operation – cannot simply be delivered by more activity in hospitals. It requires more intermediate care services, more social care services, more primary care. It needs more help so that people can avoid hospital by being treated in the community. It needs more services in the community so that those people who do need hospital treatment can return home when they are ready to do so. It needs a greater emphasis on prevention and not just treatment. A bigger role for self care through NHS Direct. Better use of pharmacist skills. More walk in centres and community hospital services to build a bridge between the big acute hospital and the patient’s home.

Some PCTs are already grasping these opportunities. Many more can now do so. It is time to shift the centre of gravity in the NHS. In these next few years – with funding on a sustainable footing for the longer term – PCTs have a huge opportunity to reshape local services in the interests of local patients. Of course patients need more hospital services which is why there is the biggest programme of building new hospitals the NHS has ever seen. It is why after decades when hospital bed numbers were cut back they are finally being built up. New diagnostic and treatment centres are going up. New equipment is going in. Hospitals have more staff – and there are more to come.

Hospitals have a secure future. But health care is not just hospital care. And with hospitals under real pressure they have to be freed up to concentrate on providing the specialist services in which they excel. So as every PCT knows with the right level of investment and the courage to make these reforms many more patients could be treated in the community.

Some are already doing that. In Hampshire the local PCT and the local Trust are now using a new primary care diagnostic centre to provide vascular services in the community rather than in the hospital. In many areas – including my own – patients needing minor surgery such as a vasectomy or the removal of a skin lesion now have their operation in the local surgery rather than in the local hospital. We need more not less of this. The presumption surely must be that only those procedures that need to be done in hospitals – for safety reasons and clinical reasons – are actually done in hospitals.

Take outpatients. Over these next few years we estimate that as many as one million outpatients could be taken out of hospitals and delivered by primary and community services. That will be mean less pressure for hospitals. More convenient care for patients. And a bigger role for primary care services.

This is happening already – but only on a small scale and in some areas. I would like it to become the norm in all areas.

It will mean developing more GPs and nurses with a specialist interest capable of diagnosing and managing a range of conditions that currently require hospital referral. In Huntingdonshire GPs specialising in dermatology have helped reduce waits from 36 weeks to 4 weeks. In Bradford, GPs who are now running outreach clinics providing ENT services have reduced reducing waiting times from 60 weeks to only a few weeks. Optometrists treating patients have reduced referrals to hospital ophthalmology services by almost two-thirds. If it can happen in these places it can happen in all.

But it will require PCTs to have the confidence and the courage to put their money where their mouths are. Into building up primary care not as an alternative to hospital care but as an addition. It will require significant investment in facilities, equipment and above all staff.

Patients being treated in primary care can only grow so long as capacity in primary care grows. And here too we want to help.

For the very first time in the history of the NHS we have set out a clear investment programme to improve the primary care estate. The NHS Plan set out our proposals to refurbish or replace up to 3,000 GP premises and to develop 500 one-stop primary health care centres. Over 1,000 premises have already been modernised. There are many more to come.

And we need many more GPs too. Progress here has been slow and we need to up the pace. But crucially after years when GP registrar numbers fell back they are now at their highest ever level. The trick is to persuade them to become fully-fledged GPs. Proper rewards and a new contract will, no doubt, help. Better childcare and more flexibility in how people are employed will help too.

But in the end I believe the biggest difference will be made by giving GPs better control over their working lives and greater ownership over the process of change. And this is where PCTs have such a crucial role to play. Just as we are devolving power and resources from Whitehall to local PCTs so local PCTs need to devolve to local practices. The PCTs need to get practices and clinicians – nurses as well as doctors – involved in reshaping local services. Every time I visit a practice and speak to a GP or a practice nurse what strikes me most is their absolute determination to raise standards in order to provide the highest quality services to their patients. Our job – together – is to harness that commitment. If we do it will not be “meltdown” for primary care. It will be the making of primary care.

The challenge for PCTs in the NHS is the challenge for all of us who care about its future – to take the opportunity of the new resources and use them to transform services for patients.

– To diversify a service which has been too monolithic for too long.

– To decentralise a service which has been centralised for too long.

– To build capacity in the service which has been neglected for too long.

– To bring choice to a service where none has existed before.

– PCTs are there for a purpose – to develop local services that genuinely meet local needs.

I do not underestimate the challenge nor the difficulties ahead. But neither do I underestimate the innovation, initiative, expertise and skills that exist in PCTs.

Only PCTs can lead these changes. You exist not to maintain the status quo – but to change it.

You have the powers and the resources to do so – now is the time to use them.

Alan Milburn – 2002 Speech on Reforming Social Services

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, to the Annual Social Services Conference, Cardiff, Wales on 16 October 2002.

This is the fourth year I have addressed your conference as Secretary of State for health and social services. Each year I have been able to report on real progress in the delivery of social care. I am pleased to say that this year is no exception. You have delivered more intensive support to help more older people live independently at home. Your co-operation with the health service has reduced delayed discharges from hospital. You have helped 10% more looked after children to be adopted.

Social services – local authorities, voluntary organisations, private sector providers – make a difference – every single day.

You make a difference when the foster parent, the teacher and the social worker help a child who has been in care all their lives get through school and then on to college.

You make a difference when the therapist and the advocate help a young man with a learning disability get training and then a job.

You make a difference when the home help and the social worker help an old lady return home after hospital to regain her confidence, her dignity and then her independence.

So, I want to thank you for what you have done and for the vital role you play in delivering care and offering hope to millions of people in our country. Good social services – and social workers – are valued. They do not deserve to be vilified.

Yet, today I believe social services are at a crossroads.

You are under scrutiny as never before. For all the millions of successes, it is the lapses in social services that still corrode public confidence. All of us here know that if social services fail, the consequences fall on the most vulnerable people in our society.

It would be comforting to believe the problems confronting social services stem purely from a hostile media. I do not believe they do. They stem in my view from a much deeper failure – a failure, which we all share, that has allowed the way we deliver social services to get out of step with the society we serve.

In the half century since the Welfare State was founded, and in particular, in the thirty years since Seebohm formulated the modern concept of social services, British society has undergone profound changes.

Fifty years ago, if you got a job, it was for life. Today, while the new global economy has brought more opportunities for prosperity than ever before, there is more insecurity and uncertainty. While unemployment has fallen sharply in recent years social exclusion has found new expression. Prosperity has widened but poverty has become more entrenched. Joblessness has become more concentrated in certain communities and amongst certain families. New social problems – particularly the link between drugs and crime – have emerged.

Family structure has undergone profound change. Family breakdown is more common. Teenage pregnancies are still too high. For the first time older people outnumber children in our society.

Public expectations have changed too. Thirty years ago the one size fits all approach of the 1940s was still in the ascendant. Public services were monolithic. The public were supposed to be truly grateful for what they were about to receive. People had little say and precious little choice.

Today we live in a quite different world. We live in a consumer age. People demand services tailor made to their individual needs. Ours is the informed and inquiring society. People expect choice and demand quality.

These changes challenge all our public services. For some, these changes call into question the very values on which health and social services are based. They say, public services must inevitably fail because they always put the needs of the institution above the needs of the individual. For them the only solution is a free market solution.

Nothing could be more mistaken. Think about it. A privatised health care system based on ability to pay not the depth of need would leave those needing health care most able to afford it least. Delivering up youngsters in care to the whim of the free market would only mean more lives paid for in drugs, delinquency and despair. We have lived through the decades when there was apparently “no such thing as society”. Society was poorer as a result. We all ended up paying the price. I believe that we must not pay that price again.

The values that underpin our social services – the recognition that we do achieve more together than we ever can alone – are more relevant today than they have ever been. The problems society faces today call for modern active social services.

It is the means of delivery – not the values of social services – that need to change.

Delivery requires investment. It is a fact that for too long social services have been the poor relation in the public services. Investment in social care has failed to keep pace with today’s challenges. You can see the impact of decades of neglect in high staff vacancy rates and staff who work under real pressure. I believe that we now have the opportunity to put that right.

A year ago I said at your conference that social services needed more resources. In the lead up to the Budget I fought for those extra resources. The Budget secured them. From April 2003, for the next three years, real growth in social services investment will double compared to the last three years. Whereas just six years ago real terms spending on social services was rising by just 0.1% a year it is now set to rise by 6% a year.

The extra resources will help get the extra staff we need. A year into the national social work recruitment campaign which I launched at last year’s conference we have already reversed the trend in falling applications. Over the next three years we can look forward to 50,000 more social care staff.

New challenges call for new skills. I think you all know the complexity of modern social problems requires more specialised skills not just the traditional general mix of social work skills. So I am today, asking the General Social Care Council, training organisations and local government to work with us to develop new types of social care professional.

People who can work in the community, combining the skills of the therapist and the home help to provide rehabilitation alongside home care. Family care workers combining the skills of the health visitor and the social worker to provide family support in times of trouble.

The extra resources give us the opportunity to make these reforms.

Of course, extra resources can not solve every problem but having made the case for extra investment in social services local government now has to spend those resources on social services.

Here I think that there is a tension: different communities have quite different needs – and that calls for a greater local say. And yet it must be right that an older person in one part of the country is able to enjoy similar standards of care to an older person in another part of the country – and that calls for proper national standards. Better services are not a choice between national standards and local control. Raising standards requires both. Getting the right balance holds the key to securing these improvements.

There was a time when there were no national standards. When care was a local lottery. I do not believe anyone who is serious about ensuring fairness in social care wants to go back to those days. Equally with national standards, tough inspections and performance ratings all now in place I believe the time is now right to shift the balance of power – to greater local autonomy. So I can tell this conference whilst there will be more resources for social services, there will be less earmarking of those resources for local government by central government. Today 17% of social services spending is ring-fenced. That will now fall to 15% next year, 11% the year after and 9% the year after that.

The Local Government White Paper sets out the basis for a new partnership between Whitehall and the town hall as a means of rejuvenating local democracy. Where councils have greater financial freedoms. Where inspection is more proportionate. Where local councils have powers to scrutinise local health services and ensure the well-being of local communities.

And we can go further. The new governance arrangements we will shortly bring forward for the first generation of NHS Foundation Hospitals will mean local government can represent the local community in the running of the local health service too.

We are moving into a whole new ball game with brand new rules: where flexibility and freedom come in return for delivery and reform. As performance improves – as I am confident it will – greater autonomy for social services and local councils will be earned. Those that are doing best will get more freedom. Those that are doing less well will get more help. Where there are persistent problems central government will step in. Where there is progress we will step back.

Those councils that enjoy the highest star ratings will get significant freedoms: reduced inspection; the right to carry over resources between one financial year and the next; the freedom to spend social services grant on any aspect of social care free from ring-fencing altogether. And I can tell this conference that, together with the Deputy Prime Minister John Prescott, I am examining further freedoms still for the best performers.

The better you do the more you get. That is a discipline that needs to apply just as much in the public sector as in the private sector. Both to provide a reward for those already the best – and to provide an incentive for those who can to do better.

At the other end of the spectrum there are a small minority of councils where social services are persistently in trouble and, frankly, failing to deliver. Here a different approach is needed. Here, central government can not stand idly by. We have a duty to act to uphold standards in care. And when we do it works.

Of the 21 councils put on special measures in the last few years, 18 have improved their performance. Since August, where there have been more entrenched problems still Performance Action Teams – put together by the private sector but involving the best of the public sector – have gone in to social services departments to strengthen management structures and improve service delivery.

And in extremis where there is endemic failure and where this form of external support also fails, I will use powers under the Local Government Act to appoint a nominee to take over the running of the local service. The nominee will be able to make radical recommendations about how the service is delivered and crucially how more effective local partnerships can be developed.

Today over half of all councils have broken away from the old monolithic, single social services departmental structures towards greater specialisation and more integration with other service providers. I want to set out now how I believe we can help you take this process further.

The old style, public service monoliths can not meet modern challenges. They need to be broken up. In their place we can forge new local partnerships that specialise in tackling the particular problems local communities face.

Combating social exclusion, breaking the link between drugs and crime, securing for elderly people dignity in old age is beyond the remit of any one organisation.

Dealing with these new challenges demands new forms of organisation: that enlist support in the community as well as of statutory agencies; that harness the expertise of the private and voluntary sectors alongside the public sector; that recognise that in the modern world people will no longer tolerate inflexible services from competing systems but demand instead flexible services from a single care system.

In recent years social services who have led the effort to break down boundaries and build up new partnerships. Two thirds of social services today are provided by the private and voluntary sectors. The 600,000 social care staff who work in those sectors provide the majority of home care and residential care. Most looked after children rely on foster carers. The voluntary sector today is the mainstay of learning disability services. New initiatives like Sure Start have put community and charitable organisations centre stage in delivering what are mainstream public services.

I believe that the voluntary and community sector has an even greater role to play. If we are to activate local communities to help deal with the problems they face – rather than simply complain about them – now is the time to bring those organisations in from the cold.

So I can tell the Conference I have asked the Strategic Commissioning Group – chaired by my colleague Jacqui Smith – to report to me on how local voluntary and community organisations could play a bigger part still in the delivery of social services.

Government, central or local, no longer needs to provide every public service. Gone are the days when Whitehall or indeed the town hall always knew best. What counts today is the quality of the service, not the origin of the provider. And today the sheer complexity of the social problems facing us call for services that are less homogenous and more specialist.

The job of providing services to children in need is a very different job from services to the elderly person. The one size fits all approach embodied in the traditional social services department may have been OK in the 1970s, but as more and more councils are recognising, it does not belong to today.

Let’s take children’s services. Every child deserves the best start in life. They need services that lift them up and keep them from harm. Mostly that is what social services deliver. Sadly, sometimes they do not.

Two years ago Victoria Climbie died in the most appalling circumstances. No one who has heard the evidence to the independent inquiry I established under Lord Laming could fail to be shocked by what occurred. Quite simply services which should have protected a vulnerable child failed that child.

When Lord Laming delivers his report it will consider what changes are needed to the whole system of child protection in our country – and we will consider his findings carefully.

We will also be considering the conclusions of this week’s report from the SSI and other Inspectors into safeguards for children. And later this year we will publish the first strand of the new children’s national service framework which will set out for the first time clear standards for all of our children’s services.

There is much that remains to be done despite the achievements of Quality Protects. Our goal surely has to be to give the children in care the same opportunities as every other child: to be part of a family; to do well at school; to get a job; to have a home; to live a life free from drugs and crime. But progress towards this goal is still too slow.

Today I can outline extra resources to help us do better. To reduce the number of children in care. To bring about improvements in life prospects when children leave care. Growing up in a stable family provides the best environment for children to develop. So over the next three years over £180 million will be made available to expand and strengthen fostering services and to provide extra support for adoption so that more children get the chance of growing up as part of stable and loving families.

Some children of course need further help still. Around one in ten aged between 5-15 years old have a mental health disorder. Tackling poor educational achievement, dealing with youth offending and other behavioural problems calls for a major expansion in child and adolescent mental health services. So I can announce today increased investment of £140 million over the next three years, to build capacity, improve access and, together with new NHS investment, to help deliver for the first time a comprehensive CAMHS service in each and every area.

To get the best from these resources, there will need to be reforms. All too often traditional service boundaries get in the way of good care for children. The local education service can be pulling in one direction with health going in the other and social services going another way still. That brings failures of communication as well as organisation. Children and parents get passed around the system. Confusion means that services intervene later when they should be involved sooner.

Fragmented decision-making is not delivering the best for anyone. I believe it is now time to develop more specialised local organisations which pool the knowledge, skills and resources that exist in our education, health and social services to provide a more seamless service for children.

So I intend to create specialist Children’s Trusts to jointly plan, commission, finance and – where it makes sense – deliver children’s services. Children’s Trusts which commission services will be based firmly in local councils with the power for the first time to commission health as well as social care. And for those Children’s Trusts that want to specialise in providing services we will want to explore a range of models in different parts of the country. These could potentially include local, not for profit, public interest companies that could enlist the involvement of the community, voluntary and private sectors alongside the public sector.

We want to pilot this new approach so in December this year my department alongside Estelle Morris’ will ask for expressions of interest from local organisations keen to test how Children’s Trusts could improve local services.

Children’s Trusts can help you dramatically reshape how social services are organised and delivered. Many of you have already taken advantage of the NHS Act flexibilities we introduced two years ago . They have allowed health and social services to work more closely together through at least 160 local partnerships delivering services now worth £2 billion a year. These services are breaking down barriers between services so that people who are elderly or have a mental health problem do not have to deal with two different – sometimes competing– systems. You know as well as I do that health and social care sink or swim together. They both need each other. The older person needs both.

Care Trusts provide another means to this end. Some are already in place. More will follow next year. Later this month we will launch a new national Integrated Care Network to provide more support and encourage wider take up. In the next two years I expect to see health and social services in every part of the country pooling resources and skills to deliver a seamless service for older people – either through a Care Trust or through use of the existing Health Act flexibilities. In time this should become the norm for how elderly care services are provided and commissioned.

In the meantime we intend to legislate to ensure that conflict between health and social services does not get in the way of older people receiving the care they need. I am continually struck when I visit health and social care around the country by the power of partnership when it works. But when it does not, it is the older person who suffers.

Delayed discharge from hospital is a particular problem affecting 5,000 older people at any one time. Thanks to your help and the resources we have made available, delayed discharges from hospitals have fallen but this has been achieved only through a short term fix of ringfenced money, top down targets and intensive monitoring. I do not believe this approach is sensible or sustainable for the long term.

In any partnership people have to know who is accountable and who is responsible for making things happen. So where people are needlessly waiting in hospital for social services to become available, we will shortly legislate so that councils reimburse the hospital for the cost of the bed the person occupies. This will provide an incentive – which does not currently exist – to end the misery of what is sometimes pejoratively called bed-blocking but is in fact thousands of older people needlessly trapped in hospital when they are well enough to be cared for in the community.

Councils that enjoy positive partnerships with the NHS – and those that are prepared to invest extra resources to build up capacity – have nothing to fear from this policy. Indeed the policy should help social services get the money spent on social services. It is not about punishing councils, still less about forcing them to fund people who wait for services that are not their responsibility. The policy will guarantee more seamless services for older people. I hope what ever your reservations might be, you will now work with us to deliver this reform.

It is all about putting the users of services centre stage. You can already teach the health service a thing or two about that. But today I want you to go further. If social services are going to genuinely put users first then those users have got to have more power. And that means more choice.

Choice is not just a question of consulting users or promising to take their views into account. Nor is it just about making advocacy services more widely available. It is all these things – and I believe that it is more.

Choice means opening up a broader span of services so that care can be tailored to fit the needs of the individual rather than assuming the individual will simply fit the off-the peg service.

In elderly care for example local councils will want to use some of the extra £1 billion we will provide over the next three years to stabilise the care home market and to buy extra care home places. But different forms of care are needed for older people too, in order to widen choice and promote independence. More intermediate care and better rehabilitation services through partnership with the health service. More extra-care housing in partnership with housing associations. More intensive home-based support. Free community equipment for the first time. And greater backing for our country’s carers. So more older people get what they say they want – help to live more independently for more of the time at home.

It is right that the generation which created our great public services should have more direct choice over those services. So I can confirm today that I will shortly be laying regulations in Parliament to ensure that all older people assessed as being in need of care – whether for rehab after a hip operation or for a bit of help with household chores – have, as of right, for the first time, the choice of receiving a direct service or instead receiving a direct cash payment to purchase care that better suits their individual needs. Direct payments will give older people direct choices over the services they receive.

And to ensure these are informed choices, I can also announce today that we will make available £9 million to help older people’s and other voluntary organisations make a reality of direct payments not just for tens of thousands of older people but for thousands of adults and the parents and carers of disabled children too.

It is local government that has called for devolution and decentralisation: to make services more responsive; to make social services more effective. Today, devolution and decentralisation are at the heart of the Government’s programme of investment and reform in public services.

But devolution does not start in the corridors of Whitehall and end at the doors of the Town Hall.

True devolution sees power flow from central government, through regional government and into local government and then out into communities and neighbourhoods. True decentralisation empowers the individual at the expense of the institution.

And social services are nothing if they are not about empowering the powerless: giving older people the power to stay in their own home; giving young people in care the chance of a stable family life; protecting the most vulnerable children from abuse and neglect; promoting independence and self-reliance; bringing hope to families where hope has almost gone.

Our task – together – is to reform social services so they are better able to empower the individual; better resourced to support the vulnerable; better structured in the interests of the user.

Having had the courage to invest in social services. Now is the time to make these big reforms. I look forward to working with the LGA, ADSS, private sector, voluntary sector and councils in making these changes happen.

Alan Milburn – 2002 Speech to PPP Forum

Below is the text of the speech made by Alan Milburn, the then Secretary of State to Health, on 17 September 2002.

It is a pleasure to be here tonight at this first 1st Annual Dinner of the PPP Forum. To have gained sponsorship from over 40 major organisations that play a leading role within the PPP industry in such a short period of time is a considerable achievement and a welcome development.

The reason I wanted to attend this evening was to emphasise the importance and priority the Government attaches to the relationship between the public and private sectors, and the pivotal role these partnerships are playing in improving our vital public services.

Indeed I believe the time is right to further develop the relationship between the public and private sectors in health care – both through the Private Finance Initiative’s central role in modernising the infrastructure of the NHS and through a broader relationship between public and private in the direct provision of services to NHS patients.

Let me start with PFI. PFI is a partnership that works. It is delivering results for patients and good value for money for taxpayers. PFI is here – and here to stay.

Thanks to the involvement of the private sector, we are now in the middle of the biggest hospital building programme in the history of the NHS. Of course after decades when the NHS was starved of the capital it needs, the Exchequer is today providing huge increases in resources for buildings and equipment.

But set against the scale of the challenge – with one third of NHS hospitals older than the NHS itself – Exchequer funding alone cannot deliver the investment that is needed. The role of the private sector, through the PFI is vital, as an addition, not as an alternative to mainstream public sector capital funding, in securing the modernisation of the health service. It is allowing more new NHS buildings to be built more quickly.

Our ten year NHS Plan promised over 100 new hospital schemes between 2000 and 2010. 68 major hospital development projects worth over £7.6 billion have already been given the go-ahead. 64 of these projects involve private finance.

A dozen new PFI hospitals are now open with a further dozen under construction. Indeed tomorrow I will officially open the new Worcestershire Royal Hospital, part of the new generation of PFI built NHS hospitals.

PFI is also successfully delivering a range of medium sized community and mental health facilities, as well as smaller scale specialist projects such as heat and power plants, staff residences and IT systems. All areas incidentally where we are looking to expand and develop new investment opportunities.

Almost 100 smaller schemes – each worth up to £25 million – have now reached financial close bringing extra investment into the NHS of over £650 million.

In primary care NHS LIFT is levering in initial investment of £300 million in those parts of the country where provision is poorest and need is greatest.

PFI has proved itself in practice to be an effective way to deliver high quality, patient-focussed services out of modern, purpose designed buildings. PFI has delivered on time and within budget – something that public sector led investment projects haven’t always managed to achieve. And of course the public gains with a legal guarantee that each of these new hospitals must be maintained as new throughout the lifetime of the PFI contract.

Because PFI is delivering the goods and is supporting innovation and new solutions to delivering public services, it is little wonder that countries in Europe and across all continents have started to think about and use PFI, looking to the UK for advice and experience. The success story in the UK is something we should trumpet to the world.

Developing these partnerships has not always been easy of course. And I want to thank the PPP Forum and many of the individual organisations here tonight for working closely with us to bring about many of the improvements to the PFI.

PFI remains controversial. But I believe much of the criticism is just plain wrong.

Initially the criticism was that PFI contracts were “mortgaging the future”; that there were years of paying out for no final return. We ended that objection by ensuring that at the end of the PFI contract, the NHS can own the hospital if that is in the best interests of the local health service and it’s what the hospital wants.

Then, the criticism was that PFI inevitably meant fewer hospital beds. It is true that in the initial rounds of PFI there were fewer beds in the new hospitals than in the old ones they were replacing, but this would have been true whether private or public capital had been used to build these hospitals. Bed losses were not caused by PFI any more than Railtrack’s problems were caused by the wrong leaves on the line.

What led to fewer beds in new hospitals was the prevailing culture in the NHS at the time that more beds were not needed or were somehow bad. A culture that over a period of 18 years or so led to the loss of tens of thousands of beds, long before PFI ever arrived on the scene.

Today – precisely because this Government have ended decades of bed reduction as part of our programme to expand NHS capacity – new hospitals, whether PFI or not, do not get the go-ahead with fewer beds. Today the number of hospital beds is rising not falling. The tranche of 19 major schemes which will go out to market this year will increase NHS bed numbers by 1700 over existing provision.

Then some argued that if PFI wasn’t bad for NHS beds it was certainly bad for NHS staff. We made a commitment in our manifesto that PFI should not be delivered at the expense of the pay and conditions of staff employed in these schemes. The Retention Of Employment scheme provides just the protection that unions representing cooks, porters, cleaners, security and laundry staff have been calling for. And I can confirm tonight that the first scheme incorporating RoE at the Walsgrave Hospital, will reach financial close next month and that all future PFI schemes where soft FM services are included will have to incorporate this new approach.

Next the argument went that the taxpayer was getting a rotten deal. But the National Audit Office in examining PFI schemes has found they will all deliver value for money. And vfm continues to improve. The legal framework and payment mechanism has become standardised. You understand the risks in PFI better. This has been reflected in the improvement in lending terms over the past few years. The better and tighter pricing of risks. When you look at it in the round, PFI is simply a better means of procurement. The NHS no longer has to rely on stop-start funding with each spending round. We can plan for the future. We can plan and invest, rather than as we used to, simply patch and make do.

On all of these counts the sometimes fierce criticism that the PFI has been subjected to has proved seriously wide of the mark. Nonetheless it is all our responsibility – private sector no less than public sector – to explain clearly the benefits of the relationship and the value it can add to improving public services – and to do so energetically and forcefully. When some newspapers, and others, criticise your work, as second rate and a shoddy product, the industry alongside Government surely has a responsibility to defend its work and reputation. Indeed, I understand that, through the PPP Forum, you have plans to market PFI more aggressively.

At the same time we will continue to reform how PFI works not least by standardising the process and bundling smaller schemes into larger deals where we can extract better value for money. We will also take the PPP approach into the provision of pathology, diagnostic and IT services.

And it shouldn’t stop there. I believe this partnership between the public and private sector is more than just about providing bricks and mortar.

Just as we have harnessed private investment through the PFI to modernise NHS buildings, we now look to harness new forms of private sector investment to modernise NHS services. With the NHS still facing major capacity constraints, increasing numbers of NHS patients are already being treated in UK private hospitals as part of the wider effort to get waiting times down for treatment. New partnerships between the public and private sectors are being developed to provide stand-alone surgery hospitals in a new generation of Diagnostic and Treatment Centres. The first DTCs are already open and I expect the first privately-run NHS DTC to be operating by the end of this year. We are also working to bring new providers from overseas into this country in order to further expand services for NHS patients.

Like NHS use of existing private sector providers, this is not a temporary measure. These new providers will become a permanent feature of the new NHS landscape. They will provide NHS services to NHS patients according to NHS principles. And in the process more diversity in provision will open up more choices for NHS patients.

These reforms are about redefining what we mean by the National Health Service. Changing it from a monolithic centrally run monopoly provider to a system where different health care providers – public, private, voluntary and not-for-profit – work to a common ethos, common standards and a common system of inspection. In such a system wherever patients are treated they remain NHS patients because they get care according to NHS principles – treatment that is free and available according to need not ability to pay. This is the modern definition of the NHS.

It is also a fundamental change. Not in how the NHS is funded or the values on which it is founded, but in how it is organised. NHS healthcare no longer always needs to always be delivered exclusively by line managed NHS organisations.

As the NHS Plan indicated a complex organisation, employing over a million people cannot simply be run from Whitehall. For patient choice to thrive it needs a quite different environment. One in which there is greater plurality in local services with the freedom to innovate and respond to patient needs.

You see the Budget on April 17th marked a watershed for the NHS and not just in the scale of the resources or the length of time for which they have been committed. Yes, it is true that against any historic benchmark they are generous with five years of real terms growth averaging 7.5% taking health spending in our country beyond the EU average.

But when we put taxes up to get more resources for the NHS we entered into a new contract with the people of our country. In exchange for extra resources we need to deliver better results. Not just improvements in services for patients but services which are increasingly shaped by the informed choices of patients. Not the old style take it or leave it NHS of the last century but an NHS that is tune with the needs of this century – where services are responsive, where patients have choices, where quality always comes first. This is the challenge we now face.

It is an explicit objective of our reforms therefore to encourage greater diversity in provision and more choice for patients particularly for elective surgery. Hence primary care trusts having the explicit freedom to purchase care from the most appropriate provider – whether public, private or voluntary. From next April we will begin to move to a system of payment by results for NHS hospitals. Resources will follow the choices patients make so that hospitals who do more get more; those who do not, will not. For the first time in the NHS patients will be able to choose hospitals rather than hospitals choosing patients.

Local health services will be independently rated for their performance. There will be more information for patients. Hospitals that are doing less well get more help, those that are doing best will get more freedom. Where there are persistent problems we will step in. Where there is progress we will step back. At one end of the spectrum new management teams – whether from the public, voluntary or private sectors – will be brought in through the franchising process to turn round NHS organisations that are in trouble. At the other the best performers will become NHS Foundation Trusts legally free from Whitehall direction and control. And let me make it quite clear, as we develop our proposals for NHS Foundation Hospitals we will ensure that any change of status for an NHS Trust does not adversely affect the delivery or sponsors of a PFI project which may be associated with it.

The scale of the investment we put in must be matched by the courage to radically reform the NHS. The NHS has great strengths in how it is organised. Its ethos and its staff express the values of our nation. Its primary care services, led by Britain’s family doctors, are the envy of many other countries. However, in addition to its long standing capacity problems, the NHS has great structural weaknesses too – not least its top down, centralised system that tends to inhibit local innovation and its monolithic structure that denies patients choice.

These weaknesses are a product of the health service’s history. They need now firmly to be consigned to its history.

At the time the NHS was being formed as a nationalised industry in the UK elsewhere in Europe many socialist or social democrat governments were creating institutions which favoured greater community ownership over state ownership. Whereas in the UK’s health care system there is uniformity of ownership, in many other European countries there are many not-for profit, voluntary, church or charity-run hospitals all providing care to the public health care system. There are private sector organisations doing the same. As other European nations testify, there is no automatic correlation that tax-funded health care has to mean health care supply run purely by central government. Tax funded health care can sit side by side with decentralisation, diversity and choice.

We can build a broader spectrum of public service providers in our country, across the public and private sectors it is true but including existing and new models of voluntary, and not-for-profit organisations. We should not constrain our reforms to what exists already but look to more radical approaches to public service reform. At the heart of these reforms must be a commitment to form effective partnerships for the benefit of the patients, pupils and public who rely on public services.

Your forum is an important element in strengthening the partnership approach in our country. We share your commitment to widening and deepening these partnerships. I applaud your efforts here tonight and I look forward to working with you as we reform, invest and enhance our public services.

Alan Milburn – 2002 Speech to the HR in NHS Conference

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 2 July 2002.

It is a pleasure to be here today with you at your Conference. This event -now one of the largest HR conferences in Europe – has quite rightly become one of the major events in the NHS calendar. It’s especially heartening to see so many board members, managers and staff side representatives here today.

We meet during a week when we will celebrate the 54th anniversary of the founding of the NHS. When in all parts of the country the NHS celebrates its achievements by opening its doors to the people it serves. And I want to place on record today my thanks to the staff of the NHS – not just the doctors and the nurses – but all the staff. The porters, the cooks, the cleaners, the scientists, the therapists, the secretaries, the managers. All of the professions who, day-in, day-out, give their all in the service of others. They represent the very best of British public service and I believe that it is time we as a nation stood up and said that we are proud of the work you do.

For me – and for millions in our country – the NHS represents the best of Britain. Its values – of fairness, community, a belief that we really do achieve more together than we ever can alone – make the NHS more relevant than it has ever been. We live in an era where health care can do more – but costs more – than ever before. In this modern world, treatment that is free based on need not ability to pay, makes a tax-funded well-funded NHS the best way to deliver health care to all our people.

Today I want to set out how I believe we in this country can make the NHS the best insurance policy in the world. And I want to describe the challenges we now must meet if we are to realise that ambition.

It is true we face major problems in the NHS. Staff feel them and patients experience them. Old buildings, outdated equipment, staff shortages, long waits for treatment. But after decades of neglect today there is progress underway. Since the NHS Plan was published two years ago the NHS has chalked up achievements in which all parts of the service can share.

In primary care, where waiting times are coming down. Where 10 million people can get out-of-hours care through a single phone call to NHS Direct. Where the prescribing of cholesterol-lowering drugs is up. Where deaths from cancer and heart disease are down.

In mental health services, where in hundreds of communities new crisis and assertive outreach teams are in place, providing services to thousands of vulnerable patients. In older people’s services, where delayed discharges from hospitals are down, where more home-based care is in place and where free nursing care is now the norm.

In ambulance services, where today all but a handful are achieving the emergency response call time, when just two years ago only a handful were achieving that.

In hospital services, where a year ago people were having to wait up to 18 months for their hospital operation. Today, the maximum wait at 15 months is moving towards the NHS Plan guarantee of a maximum 3 month wait. The number of people experiencing long waits for an outpatient appointment is the lowest on record. And for those with the most serious clinical conditions – cancer and heart disease – waiting times are lower still.

Yes, of course, there is a long way to go. The NHS Plan is unashamedly a programme for ten years not just for two. But the NHS today is now beyond first base in delivering it. Each of these achievements has been hard won. There are many more challenges to come. Anyone who says there are no problems is wrong. But those who say there has been no progress have got it totally wrong.

While those who are implacably opposed to the NHS – in principle as well as in practice – accuse it of being a black hole, which simply absorbs public money without return, those critics should instead be pointing at dozens more hospitals, hundreds more beds, thousands more doctors, tens of thousands more nurses – and an NHS that is now on the up. They should go and see what I see in every hospital, health centre and surgery I visit. Not just the investment coming through but the reforms too – in how staff work and how services are organised.

The 10-year journey we mapped out in the NHS Plan is now firmly underway. And now we can move up a gear.

The Budget on April 17th marked in my view a watershed for the NHS. And I don’t just mean the scale of the resources or the length of time for which they have been committed. Yes, against any historic benchmark they are generous. Five years of real terms growth averaging 7.5% will take health spending in our country beyond the EU average – an average which the cynics said we couldn’t even get near. It is worth remembering that just six years ago spending on the NHS was falling in real terms. By 2008 it will have doubled in real terms.

What is more, social services – for too long the poor relation – are to enjoy big rises in investment too. Six years ago spending on social services was falling. Today it is rising by over 3% in real terms. From next April it will double to 6% a year over and above inflation for the next three years.

The Budget laid to rest a decades old fallacy – that we in Britain could have world class health care on the cheap. We can’t.

As the reaction to the Budget has shown, there is overwhelming public support for the extra investment. But there is considerable public scepticism about the ability of the NHS to turn those resources into results for patients. You only have to read some of our newspapers to hear the voices of scepticism. Sometimes it is not just scepticism about the NHS. It is downright hostility. Some in politics and in business say the NHS, precisely because it is run on public service principles, can never actually deliver the goods for patients.

I know those doubters are wrong. Our job is to prove them wrong. And we can only do that by working together. Staff and managers, trades unions and employers. Our job is to use the extra investment to reform the NHS so that it can deliver faster treatment, higher standards and a better experience for patients.

You see when we put taxes up to get more resources for the NHS – as people in the NHS urged us to do – we entered into a new contract with the people of our country. In exchange for extra resources we have to deliver better results. Not just improvements in services for patients, but services which are increasingly shaped by the informed choices of patients. Not the old style “take it or leave it” NHS of the last century, but an NHS that is in tune with the needs of this century – where services are responsive, where patients have choices, where quality always comes first. This is the challenge together we must now meet. I believe we can only meet it by a combination of sustained investment and far-reaching reform.

In the first place, if the NHS is to deliver for patients it has to remain focussed on what counts for patients. And the extra resources must be properly focussed too. The NHS does many things. There will be many pressures from many quarters for many good causes. But none of us will be forgiven if, having raised the resources, we fail to use them to get the results that both staff and patients want to see. Shorter waiting times. Higher clinical standards. Better health outcomes.

The public’s priorities have to be the health service’s priorities. Getting waiting times down in every aspect of NHS care from ambulances to x-rays, from primary care to secondary care. Providing quick, high-quality emergency services, not least in A&E. Making sure that the fundamentals are right – clean wards and safe care. Improving cancer, cardiac, mental health and elderly services.

These are the priorities. In time it is true we will develop further NSFs, but only at a pace the NHS can properly absorb. And to help local health services focus on these priorities, we will not only cut the number of plans that have to be submitted to the centre but, for the first time later this year, give local services three year’s worth of funding so that there is financial certainty for the medium term rather than the short term.

Stability over resources will allow the NHS to implement a sustained programme of expansion. It is time to go for growth. To use the large scale increases in both revenue and capital funding to expand capacity. To shift the balance of services so that more patients can be seen in primary, community and social services, not just in hospitals.

Each of the 28 new Strategic Health Authorities are now finishing their capacity plans. These plans will address how shortages – whether of buildings, equipment or staff – in each part of the country can be plugged. The biggest capacity constraint the NHS faces of course is the shortage of trained staff. That can place existing staff under huge strain. The new Workforce Development Confederations – working with the StHAs – have a key role to play in getting the extra staff the NHS needs into post.

And here too there are good foundations on which to build. The cuts in nurse and GP training places that took place in the 1990s have both been turned into growth. Training places for physiotherapists are up by almost two thirds. The number of applicants for nurse training has more than doubled since 1997. The fall in applicants for medical school places has been reversed. The largest ever increase in medical school places has already delivered 25% more medical students. The NHS Plan target to get an extra 20,000 nurses working in the NHS by 2004 has been hit two years ahead of schedule. Since 1997 the number of nurses working in the NHS has increased by over 30,000, the number of scientists and therapists by almost 14,000 and the number of doctors by 9,500. But there is more to do if we are to realise our latest plans for an extra 15,000 consultants and GPs, 35,000 more nurses, midwives and health visitors and 30,000 therapists and scientists on top of what has already been achieved.

Today I can report on two changes that will help NHS employers not just with recruitment but with retention too.

First, pay for staff. NHS staff deserve fair pay. There is no argument about that. But what I am not prepared to do is to see the large increases in funding for the NHS all go on extra pay. There has to be responsibility in public sector pay, including in the NHS. So I am prepared to invest more, but only in exchange for getting more. That is what lies at the heart of the new consultants contract we have agreed with the BMA. It is a something for something deal. Where consultants can earn more, but only if they do more for NHS patients. And it will be for NHS employers to make sure that is what the contract delivers.

A similar approach applies to the proposed new contract for GPs – the more they do the more they can get. Throughout the NHS better pay must be earned, through improved performance, greater productivity, more flexibility. That is the deal that is on offer through the Agenda for Change negotiations on a new pay system for staff other than doctors. These negotiations have been long and hard. I can confirm today, however, that we have started the final phase of the negotiations. I hope, after consultation, we can start implementing the new system – and a longer term pay deal alongside it – by the start of the next financial year.

Today my department is writing to all NHS Trusts seeking expressions of interest in joining this initial implementation phase. Agenda for Change holds out the prospect of better pay for NHS workers, in exchange for an end to old-fashioned working practices. It will mean an NHS where staff are paid according to the work they do not the job title they hold. So that the senior nurse who takes on more responsibility gets more pay. So that the clerical officer who provides support for a large clinical team gets paid more than the administrator who is in charge of more routine work. We need a system which makes sure people are paid for what they do and encourages them to progress. So that there is a positive incentive to encourage the ambulance technician to become a full paramedic and, in turn, for the paramedic to gain advanced skills so that they can deliver more frontline clinical care to patients.

Agenda for Change is all about transforming and modernising working practices in the NHS. If we can get it right, it will help bring to an end the remaining outdated professional demarcations that stand in the way of patients getting the faster, high quality care they need.

Pay reform alone, however, will not deliver the extra staff the NHS needs. Improvements in care for patients can only happen if there are improvements in the care we give to staff. I have never agreed with those who say that we have to choose between investing in staff or investing in services. In the NHS they are one and the same.

The HR in the NHS Plan, which Andrew Foster launched yesterday at this conference, makes the case for the health service becoming a model employer. The NHS won’t get better treatment for patients unless it offers better treatment for staff. The NHS is already Britain’s largest employer. Our aim should be to make it the best.

In a world where patients rightly want flexibility – over when they are treated – and where staff need flexibility – to balance their family and their working lives – NHS employers need to respond. That is why we put in place the Improving Working Lives programme, so that every part of the NHS offers staff flexi-time, annual hours, flexible retirement or career breaks. Some employers are already doing precisely that – and reaping the benefits through more staff and better staff morale. By next Spring I will be looking to every NHS employer to deliver these changes.

Help with childcare is crucial too. Our manifesto commits us to invest an extra £100 million – from the savings made by abolishing the old health authorities and NHS regional offices – in improved childcare for staff. A start has been made. By this time next year the NHS will have funded double the number the number of workplace nurseries than it did just last year. Staff I have met – whether at the Freeman Hospital in Newcastle or at the Lewisham Hospital in London – have all stressed how important these nurseries are for them in what are inevitably busy lives.

On-site nurseries, while good for some staff, however, are not right for all. I can announce today then a further £6 million to make other forms of childcare – such as after school clubs and holiday playschemes – available to NHS staff. All staff – including our country’s family doctors and their staff – will be eligible for help.

These changes – a new pay system and more support for staff – will help deliver the increases in professionals the NHS needs. By necessity this is a programme for the medium term. It takes 3 years to train a radiographer, and many more to train a consultant. The last few years have seen more staff of course – and there are more to come – but there are still staff shortages. This is particularly the case with doctors in certain key specialities. That is why, over recent months, we have embarked on a major drive to recruit trained medical staff to the NHS from abroad.

Today I can report on progress. Since the global recruitment campaign began we have identified around 500 doctors who are suitable for employment in the NHS. To date around 100 have been matched with NHS Trusts who are interested in employing them. In addition, Sir Magdi Yacoub is heading our efforts to bring highly qualified doctors to this country through a specially devised NHS International Fellowship Scheme. Doctors who come to this country will work in the NHS on Fellowships for up to 2 years. We are initially concentrating on recruiting them to four key shortage specialities – cardiothoracic surgery, histopathology, radiology and psychiatry.

We had expected to recruit 50 fellows in the first phase. In fact, thanks to the help of the medical royal colleges and others, I expect double this number to be short-listed. And I expect the majority of short-listed International Fellows to be in place by the end of 2002.

Last week, I also met with private health care providers from France, Germany and Sweden who are interested in bringing into this country their own clinical teams in order to further expand elective services for NHS patients. We are now in active discussions with several of them. A key stipulation for us is that they bring their own suitably qualified medical staff with them, rather than seeking to take existing NHS doctors out of NHS hospitals.

Some, both from within the NHS and from existing private sector providers, have expressed concern about this plan. Similarly, some have pointed to concerns and even resistance to our proposal to recruit individual overseas doctors into NHS hospitals. I find this surprising. Everyone knows the NHS need more doctors. It is doctors, above all others in this country, who have quite reasonably argued that case. Of course standards – including language skills – have to be right. But what we cannot have – and what I will not accept – is anyone having a right of veto on NHS patients getting the extra doctors they need. There can be no question of restrictive practices, wherever they are found, standing in the way of an expansion in services for NHS patients. I will be looking to NHS employers to always put the needs of NHS patients ahead of any other consideration.

Let me just make this general point: reform is not an optional extra in the NHS. It is as vital as the investment. It is central to the renewal of the health service. To be clear : when it comes to NHS reform our foot will be on the accelerator not, as some argue, on the brake.

So I am planning for the first of a growing number of these new overseas providers to be in place later this year. They will concentrate on elective surgery in hard-pressed specialties in those parts of the country where capacity constraints are greatest. Like NHS use of existing private sector providers, this is not a temporary measure. These new providers will become a permanent feature of the new NHS landscape. They will provide NHS services to NHS patients according to NHS principles. And, in the process, they will open up more choices for patients and more diversity in provision.

All of this is about expanding the services that are available to NHS patients so they can get faster treatment and higher standards. These reforms are also redefining what we mean by the National Health Service. Changing it from a monolithic, centrally-run monopoly provider to a system where different health care providers – public, private, voluntary and not-for-profit – work to a common ethos, common standards and a common system of inspection. In such a system, wherever NHS patients are treated they remain NHS patients because they get care according to NHS principles – treatment that is free, based on need, not ability to pay. This is the modern definition of the NHS.

This new diversity in NHS provision, coupled with sustained expansion in capacity, provides the basis for patients to exercise more choices about their care. As capacity expands so choice can grow. From next April we will begin to move to a system of payment by results for NHS hospitals. For elective services resources will follow the choices patients make so that hospitals that do more, get more; those who do not, will not. Over the next four years, an increasing proportion of each hospital’s income will come to it as a result of the choices patients make. For the first time in the NHS, patients will be able to choose hospitals rather than hospitals choosing patients so marking an irreversible shift from the 1940s take it or leave it, top down service.

That process started this week with patients waiting more than 6 months for a heart operation being offered a choice of a faster waiting time in another hospital which has the capacity to treat them – whether it is public or private, on the doorstep or further afield, in this country or abroad. This week sees the first small but significant step towards our 2005 ambition of a service where all patients needing a hospital operation can choose not just the location of their treatment but when to be treated and by whom.

Of course, different approaches will be needed to bring about improvements say, in emergency care or mental health services. But overall this is the most fundamental change the NHS will have ever faced. Not in how it is funded or the values on which it is founded, but in how it is organised. Patients will be in the driving seat – and not before time.

NHS healthcare no longer always needs to be delivered exclusively by line-managed NHS organisations. The task of managing the NHS becomes one of overseeing a system, not running an organisation. Responsibility for day-to-day management can be devolved to local services. None of this means the abandonment of national standards. Far from it. It is precisely because over these last five years we have put in place such a rigorous framework of standards nationally, that the centre of gravity can now shift to how improvements can be delivered locally.

So while some advocate a false choice between national standards and local autonomy, the truth is that securing improvements in performance requires both.

Later this month local health services will receive a star rating for their performance. Those who are doing less well will get more help. Those that are doing best will get more freedom. Where there are persistent problems we will step in. Where there is progress we will step back. At one end of the spectrum new management teams – whether from the public, voluntary or private sectors – will be brought in through the franchising process to turn round NHS organisations that are in trouble. At the other, the best performers will be able to become NHS Foundation Trusts, legally free from Whitehall direction and control. Three-star trusts will have less monitoring and greater freedom.

The more overall performance improves – as I am confident it will – the more autonomy will be earned across the NHS. That is what I want to see happen. We are at the start of a transition where more and more decisions about the NHS are taken locally rather than centrally.

The reason for this is simple enough. In the end I don’t treat patients. You do. Whitehall doesn’t provide care. That is what hospitals, health centres and surgeries do. And that is where power needs to be located. On the frontline. Our core objective is to shift the centre of gravity in the NHS. It is right that standards are set nationally, but it is wrong to try to run the NHS nationally. This is something which the new strategic health authorities in their relationships with Primary Care Trusts will need to fully understand: the PCTs need to be helped and enabled, not commanded or controlled. In turn, they need to devolve resources to their constituent practices from the growing proportion of the NHS budget the PCTs will control. From 2004, three-quarters of the NHS budget will be controlled by PCTs.

It is time to unleash the spirit of public service enterprise that I know exists in so many parts of the NHS. The simple truth is the NHS works best when it harnesses the commitment and know-how of staff to improve care for patients. That’s why we are putting ward sisters in charge of ward budgets and giving health visitors a greater say over community health budgets. It’s why matrons are being given the power to get the fundamentals of care – like clean wards and good food – right for patients. It’s why nurses are being given new powers to prescribe drugs and discharge patients.

And crucially doctors – with all their skills and knowledge – need to be empowered too. Too many doctors for too long have felt disempowered. Through PCTs there is now a major opportunity for doctors in primary care to shape local services to suit local circumstances. Devolution of budgets to practices will aid that process of clinical engagement. In secondary care there is more to do. Here a new effort to engage doctors in the process of change is needed. Just as PCTs need to devolve responsibility to their front-line staff, so do Trusts. Resources and responsibility need to be placed on the front line. That will become an absolute imperative as patients get greater choice and their choices are backed by resources. Clinical teams need to have the resources and authority to make their services more responsive to patients. And as staff at the James Cook University Hospital on Teesside were arguing with me yesterday, when clinical teams do well, staff need to be rewarded too.

The people at this conference today are the key to delivering these changes. Senior managers in the NHS – working with the NHS trade unions – have a real responsibility to ensure that staff at all levels are involved in the process of change and, crucially, that clinical teams are engaged and empowered.

When they are – as in the collaborative programmes already begun in cancer, coronary and primary care – the results are staggering. More than 90% of practices involved in the primary care collaborative for example are able to guarantee patients an appointment to see a GP within 48 hours. But staff involvement should not have to be left to special programmes in some parts of the NHS. It should be the norm in every part of the health service. Whether it is the doctor or the porter, the engineer or the cleaner, every member of staff in the NHS should be involved in helping make change happen.

In a world where knowledge is king, other industries have long since learned that the successful organisation is one that consistently develops its staff and harnesses their potential. It is a lesson that the NHS has been too slow to learn. But through the NHS University, NHS Learning Accounts, the NHS Modernisation Agency and the Leadership Centre we can now put that right.

Last year, for example, almost 20,000 NHS staff who are currently without a qualification were able to access either an NHS Learning Account or NVQ training or assessment. This year the £60m that has been allocated direct to Workforce Development Confederations will allow a further 90,000 staff to benefit. And when staff benefit, patients benefit too – through people delivering services who are better trained and better able to fulfil their potential.

There is no more important management function in today’s NHS than getting the best from all its staff.

In the end, the NHS is the people who work for it. I want to see an NHS that is true to its principles but reformed in its practices. Where patient choice drives change. And where front-line staff are empowered to make those changes happen.

The Budget this year represents an enormous vote of confidence in all of you, in the whole of the health service.

Some have said that the Budget is a gamble. In some people’s minds it may be. But not in mine. I wouldn’t have fought so hard for the resources we’ve now got if I thought there was a better way of providing health care for our country. For me there is no better way than through the NHS.

And with your help, I know that the best days of the NHS lie in the future, not in the past.

Alan Milburn – 2002 Speech on Empowering Front Line Staff

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, to the British Association of Medical Managers on 12 June 2002.

It is a pleasure to be here today with you at your Conference. BAMM has been at, the forefront of improvement and innovation within the NHS for many years. The people at this conference today are leading change in all aspects of care and I want to place on record my thanks to you and particularly to BAMM and Jenny Simpson for the leadership you are giving.

I want today to set out the challenges facing the health service. And how I believe that with your drive and support the NHS can rise to meet them.

We are a long way from realising the ambition all of us share for a service which genuinely offers patients the choice of quick high quality care which always puts their needs first. But we are making good progress towards it. Since the NHS Plan was published two years ago the NHS has chalked up achievements in which all parts of the service can share.

In primary care, where waiting times are coming down. Where 10 million people can get out-of-hours care through a single phone call to NHS Direct. Where the prescribing of cholesterol-lowering drugs is up by one third.

In mental health services, where in hundreds of communities new crisis and assertive outreach teams are in place providing services to thousands of vulnerable patients. In older people’s services, where delayed discharges from hospitals are down, where more home-based care is in place and where free nursing care is now the norm.

In ambulance services, where today all but a handful are achieving the emergency response call time, when just two years ago only a handful were achieving that.

In hospital services, where a year ago people were having to wait up to 18 months for their hospital operation. Today the maximum wait at 15 months is moving towards the NHS Plan guarantee of a maximum 3 month wait. The number of people experiencing long waits for an outpatient appointment is the lowest on record. And for those with the most serious clinical conditions – cancer and heart disease – waiting times are lower still.

Yes, of course, there is a long way to go. But the NHS is now beyond first base in delivering the NHS Plan. Each of these achievements has been hard won. There are many more challenges to come. Anyone who says there are no problems has clearly got it wrong. But those who say there has been no progress have got it totally wrong.

While they accuse the NHS of being a black hole which simply absorbs public money without return, these critics should instead be pointing at dozens more hospitals, hundreds more beds, thousands more doctors, tens of thousands more nurses – and an NHS that is now on the up. They should go and see what I see in every hospital, health centre and surgery I visit. Not just the investment coming through but the reforms too – in how staff work and how services are organised.

And nowhere is reform more necessary than in the way we employ our staff in the NHS.

More than 50 years ago in order to establish the National Health Service my predecessor Nye Bevan concluded a contractual agreement with the BMA for the employment of hospital consultants. Today our 26,000 NHS consultants are working within a contract which has largely gone unchanged since 1948.

Most consultants work very hard for the NHS and with tremendous commitment to the principles of the NHS. I acknowledge many of them are working above and beyond their strict contractual obligations to the health service. That is a measure of their commitment which has not always been rewarded in their contracts.

The way consultants have been managed under their existing contract has been far from satisfactory. Too few consultants have proper job plans setting out their key objectives, task and responsibilities and when they are expected to carry out their duties. Even fewer have their performance regularly reviewed. And the issue of consultants’ private practice has remained a legacy of Bevan’s 1948 settlement.

In the NHS Plan, I committed the Government to a new consultant contract to recognise and reward those who do most for the NHS.

I am pleased to be able to tell the Conference that we have today reached agreement with the BMA on a new framework for the NHS consultant contract.

We are jointly proposing with the BMA that the new contract be accompanied by a 10% three year pay deal that we will also be offering to other staff in the NHS alongside reforms to their pay systems.

The new contract is good news for NHS patients and for NHS consultants. It is a something for a something deal. It offers more pay for NHS consultants so that more NHS patients benefit from more of their precious time and skills. Crucially, it recognises and rewards those NHS consultants who do most for the NHS.

It offers consultants a higher starting salary and increases in earnings over the lifetime of their work for the NHS. There will be extra pay for those with the heaviest on-call duties.

Unlike the existing contract, however, where there are automatic increases in salary, in future consultants extra earnings will be dependent for the first time on performance against agreed job plans. The job plan will set out how consultants time should be best used for the benefit of NHS patients. It will secure more face to face sessions with patients with an increase in the time consultants spend on direct clinical care. The current system of fixed and flexible sessions will go to be replaced with a new system in which NHS work is timetabled and typically carried out on site with no non-NHS work permitted during this time. The old NHS working week of 9-5 will also go. Instead NHS employers will be able to schedule consultants work and pay for it at standard NHS rates between the hours of 8am to 10pm Monday to Friday and 9am to 1pm at weekends. This new system of flexible working will be good for both consultants and for patients. As we expand consultant numbers it will make for more efficient and productive use of NHS facilities – such as operating theatres – that could otherwise lie idle. And because NHS employers will be able to buy extra consultant time within these NHS hours at NHS pay rates it will avoid some of the more inflated rates we have sometimes seen over recent years.

The new contract also deals once and for all with the vexed issue of private practice. It removes a long running sore which dates all the way back to 1948. The relationship between private practice and NHS work for consultants has for too long been clouded by lack of clarity, lack of accountability and an inevitable – often unfair – perception that some consultants do not always give full commitment and priority to the NHS and to their NHS patients. The new contract will herald an entirely fresh approach, designed to prevent any perceived or actual conflict of interest, based on one overriding principle: that an NHS consultant’s first and foremost commitment is to the NHS and to their NHS patients.

For the first time it will be explicitly part of the consultants contract of employment that NHS patients come first and the NHS always has first call on consultants time. It does this first of all, by giving exclusive use to the NHS of up to 48 hours of a newly qualified consultants time each week – the maximum the NHS could demand under the Working Time Directive. Under the new contract this exclusive use of newly qualified consultants time will apply for the first seven years of their careers, as we proposed in the NHS Plan. Secondly, the new contract goes further than the NHS Plan because any consultant wanting to undertake work on privately paying patients after seven years of NHS service will need to give the NHS an extra session of four hours a week at normal NHS pay rates. Thirdly, new rules on private practice will set out how NHS commitments must always take precedence over private work with adherence to these new rules enforceable as part of the new contract. Access to higher salary levels will depend on consultants meeting these new standards and, of course, the objectives in the consultant’s job plan being met.

These are fundamental and far reaching changes to how NHS consultants are employed, rewarded and managed. NHS consultants will get more – but only if NHS patients get more. The old contract was a throwback to the world of 1948. The new contract will reform traditional working practices to deliver modern, flexible services to more NHS patients.

So the 10-year journey we mapped out in the NHS Plan is now firmly underway. And now we are moving up a gear.

The Budget on April 17th marked a watershed for the NHS. And I don’t just mean the scale of the resources or the length of time for which they have been committed. Yes, against any historic benchmark they are generous. Five years of real terms growth averaging 7.5% will take health spending in our country beyond the EU average – an average which the cynics said we couldn’t even meet. It is worth remembering that just six years ago spending on the NHS was falling in real terms. By 2008 it will have doubled in real terms.

What is more, social services – for too long the poor relation – are to enjoy big rises in investment as well. Six years ago spending on social services was falling. Today it is rising by over 3% in real terms. We know that more is needed. We have listened to what local government, private sector care homes and local health services have all had to say. So now, spending on social services will double to 6% a year over and above inflation for the next three years.

The Budget laid to rest a decade’s old fallacy – that we in Britain could have world class health care on the cheap. We can’t. The evidence is there for all to see. The run down buildings. The outdated equipment. The failure to invest in modern IT. The shortages of trained staff. The long waits that we inflict on patients.

We are bringing the decades of NHS neglect to an end. With the economy on a stable footing we can now put the NHS on a sustainable footing for the long term. As the reaction to the Budget has shown, there is overwhelming public support for the extra investment. But there is considerable public scepticism about the ability of the NHS to turn those resources into results for patients. A failure to deliver improvements will prompt only one response: not more money in the future for the NHS, but less. Not collective provision of health care, but more individual provision. Not the public sticking with the NHS but the public walking away.

You only have to read some of our newspapers to hear the voices of scepticism. Sometimes it is not just scepticism about the NHS. It is downright hostility. You can hear other voices too. Some in politics or in business who say the NHS, precisely because it is run on public service principles, can never actually deliver the goods for patients.

We have to prove those doubters wrong. And we have to do it together.

When we put taxes up to get more resources for the NHS – as people in the NHS urged us to do – we entered into a new contract with the people of our country. In exchange for extra resources we will deliver better results. Not just improvements in services for patients, but services which are increasingly shaped by the informed choices of patients. Not the old style take it or leave it NHS of the last century, but an NHS that is tune with the needs of this century – where services are responsive, where patients have choices, where quality always comes first. This is the challenge together we must now meet.

We can only meet it by a combination of sustained investment and far-reaching reform.

In the first place, if the NHS is to deliver for patients it has to remain focussed on what counts for patients. And the extra resources must be properly focussed too. The NHS does many things. There will be many pressures from many quarters for many good causes. But none of us will be forgiven if having raised the resources we fail to use them to get the results that both staff and patients want to see. Shorter waiting times. Higher clinical standards. Better health outcomes.

The public’s priorities have to be the health service’s priorities. Getting waiting times down in every aspect of NHS care from ambulances to diagnostics, from primary care to secondary care. Providing quick, high-quality emergency services, not least in A&E. Making sure that the fundamentals are right – clean wards and safe care. Improving cancer, cardiac, mental health and elderly services.

These are the priorities. In time it is true we will develop further NSFs, but only at a pace the NHS can properly absorb. And to help local health services focus on these priorities, we will cut the number of plans that have to be submitted to the centre and, for the first time later this year, give local services three year allocations of cash so that there is financial certainty for the medium term rather than the short term.

Stability over resources will allow the NHS to implement a sustained programme of expansion. It is time to go for growth. To use the large scale increases in both revenue and capital funding to expand capacity. To get the staff, the buildings, the equipment the NHS needs. To shift the balance of services so that more patients can be seen in primary, community and social services, not just in hospitals.

The biggest constraint the NHS faces is shortages of capacity. So in addition to sustained growth in existing NHS provision, we will bring new providers from overseas into this country in order to further expand elective services for NHS patients. They will concentrate on elective surgery in hard-pressed specialties in those parts of the country where capacity constraints are greatest. I expect to see a growing number of these new providers in place beginning later this year. Like NHS use of existing private sector providers, this is not a temporary measure. These new providers will become a permanent feature of the new NHS landscape. They will provide NHS services to NHS patients according to NHS principles. And, in the process, they will open up more choices for patients and more diversity in provision.

These reforms are about redefining what we mean by the National Health Service. Changing it from a monolithic, centrally-run monopoly provider to a system where different health care providers – public, private, voluntary and not-for-profit – work to a common ethos, common standards and a common system of inspection. In such a system, wherever patients are treated they remain NHS patients because they get care according to NHS principles – treatment that is free and available according to need, not ability to pay. This is the modern definition of the NHS.

This new diversity in NHS provision, coupled with sustained expansion in capacity, provides the basis for patients to exercise more choices about their care. As capacity expands so choice can grow. From next April we will begin to move to a system of payment by results for NHS hospitals. Resources will follow the choices patients make so that hospitals who do more get more; those who do not, will not. Over the next four years, an increasing proportion of each hospital’s income will come to it as a result of the choices patients make. For the first time in the NHS, patients will be able to choose hospitals rather than hospitals choosing patients. That process will start this summer when patients waiting more than 6 months for a heart operation will be able to choose a faster waiting time in another hospital which has the capacity to treat them – whether it is public or private, on the doorstep or further afield, in this country or abroad. By 2005, all patients needing a hospital operation will be able to choose not just the location of their treatment but when to be treated and by whom.

Of course, different approaches will be needed to bring about improvements say, in emergency care or mental health services. But overall this is the most fundamental change the NHS will have ever faced. It will mark an irreversible shift from the 1940s take it or leave it, top down service. Patients will be in the driving seat – and not before time.

All of this is a fundamental change for the NHS. Not in how it is funded or the values on which it is founded, but in how it is organised. NHS healthcare no longer always needs to be delivered exclusively by line-managed NHS organisations. The task of managing the NHS becomes one of overseeing a system, not running an organisation. Responsibility for day-to-day management can be devolved to local services. None of this means the abandonment of national standards. Far from it. It is precisely because over these last five years we have put in place such a rigorous framework of standards nationally that the centre of gravity can now shift to how improvements can be delivered locally.

So while some advocate a false choice between national standards and local autonomy, the experience from elsewhere in Europe in the health sector, and from across the developed world in other economic sectors, is that securing improvements in performance requires both.

There is a simple deal on offer here. The better you do the more you get. It is a discipline that needs to work just as much in public services as in the private sector. I have lost count of the number of times I have been told by NHS managers and NHS clinicians alike that the NHS has got to stop bailing out the poorest performers, and instead reward the better performers in the NHS in order to provide the right incentives for innovation and improvement to take hold across the whole of the NHS. And that is precisely what we must do if we are to translate the extra resources into real results for patients.

That is the reason for star rating the performance of local health services so that those who are doing less well get more help, those that are doing best get more freedom and those that are persistently failing feel the consequences. Where there are persistent problems we will step in. Where there is progress we will step back. At one end of the spectrum new management teams – whether from the public, voluntary or private sectors – will be brought in through the franchising process to turn round NHS organisations that are in trouble. At the other, the best performers will become NHS Foundation Trusts, legally free from Whitehall direction and control. Three-star trusts will have less monitoring and greater freedom.

The more overall performance improves – as I am confident it will – the more autonomy will be earned across the NHS. That is what I want to see happen. We are at the start of a transition where more and more decisions about the NHS are taken locally rather than centrally.

It is time to unleash the spirit of public service enterprise that I know exists in so many parts of the NHS.

Some functions will still be carried out – as in any large organisation – at the centre. But rather than trying to drive improvements through top-down performance management, the transition will be towards improvements being driven through greater local autonomy in which PCT commissioning, new financial incentives and the choices that patients make become the driving force for change, with scrutiny through independent inspection. That transition will take time. It will require careful management and a new, more mature understanding about the relationship between government and the health service, where the government does less and the NHS does more.

In the end I don’t treat patients. You do. Whitehall doesn’t provide care. That is what hospitals, health centres and surgeries do. And that is where power needs to be located. On the frontline. Our core objective is to shift the centre of gravity in the NHS. It is right that standards are set nationally, but it is wrong to try to run the NHS nationally. This is something which the new strategic health authorities in their relationships with Primary Care Trusts will need to fully understand: the PCTs need to be helped and enabled, not commanded or controlled. In turn, they need to devolve resources to their constituent practices from the growing proportion of the NHS budget the PCTs will control. From next year, three-quarters of the NHS budget will be controlled by PCTs.

The simple truth is the NHS works best when it harnesses the commitment and know-how of staff to improve care for patients. That’s why we are putting ward sisters in charge of ward budgets and giving health visitors a greater say over community health budgets. It’s why matrons are being given the power to get the fundamentals of care – like clean wards and good food – right for patients. It’s why nurses are being given new powers to prescribe drugs and discharge patients.

And crucially doctors – with all their skills and knowledge – need to be empowered too. Too many doctors for too long have felt disempowered. Through PCTs there is now a major opportunity for doctors in primary care to shape local services to suit local circumstances. Devolution of budgets to practices will aid that process of clinical engagement. In secondary care there is more to do. Here a new effort to engage doctors in the process of change is needed. Just as PCTs need to devolve responsibility to their front-line staff, so do Trusts. Resources and responsibility need to be placed on the front line. That will become an absolute imperative as patients get greater choice and their choices are backed by funds. Clinical teams need to have the resources and authority to make their services more responsive to patients. And as patients choose particular clinical teams, to be rewarded too.

The people at this conference today are the key to delivering these changes. Chief Executives, Medical Directors and PEC chairs have a real responsibility to ensure that clinical teams are engaged and empowered. When they are – as in the collaborative programmes already begun in cancer, coronary and primary care – the results are staggering. More than 90% of practices involved in the primary care collaborative for example are already able to guarantee patients an appointment to see a GP within 48 hours. But staff involvement – particularly to harness the skills and expertise of doctors – should not have to be left to special programmes in some parts of the NHS. It should be the norm in every part of the health service.

That is why I warmly welcome the BAMM initiative – Fit to Lead – being launched at this conference. It is a critical piece of the jigsaw: for the first time, doctors in management and leadership roles will have the tools and the training to demonstrate their competence as medical leaders. It is why over these next two years, through the NHS Leadership Centre programmes, every medical director and over 500 other senior medical leaders in secondary care – mainly clinical directors – will have had the opportunity of attending a national leadership programme.

In a world where knowledge is king, other industries have long since learned that the successful organisation is one that consistently develops its staff and harnesses their potential. It is a lesson that the NHS has been too slow to learn. But through the NHS University – that BAMM has helped pioneer – through the NHS Modernisation Agency and the Leadership Centre we can now put that right.

In the end, the NHS is the people who work for it. I want to see an NHS that is true to its principles but reformed in its practices. Where patient choice and responsiveness to patients drive change. And where front-line staff are empowered to make those changes happen.

The Budget this year represents an enormous vote of confidence in all of you, in the whole of the health service.

Some have said that the Budget is a gamble. In some people’s minds it may be. But not in mine. I wouldn’t have fought so hard for the resources we’ve now got if I thought there was a better way of providing health care for our country. For me there is no better way than a tax funded, well funded NHS.

With your help the best days of the NHS lie in the future not in the past.

Alan Milburn – 2002 Speech on Diversity and Choice within the NHS

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, to the NHS Confederation on 24 May 2002.

It’s a year since I last spoke to you. Those twelve months have been a time of great change and major challenge for the NHS and the people who work in it, lead it and manage it.

The old health authorities and regional offices have gone. The new primary care trusts are up and running and the new strategic health authorities are on their way. When these changes were first proposed some said they were too risky. It is certainly true that at a time when the NHS is focussed on delivering a major programme of improvement there were risks associated with making these changes.

But the transition has gone better than many feared. And that is thanks to you. Non-executive directors, managers, clinicians and chief executives. Without you these changes would not have been as well-managed as they have been. At a time when NHS management continues to face enormous criticism from some quarters – and even the occasional critical comment from me – I want to place on record my thanks for the job you have done. Good management is needed now more than ever in the NHS.

I also want to thank the NHS Confederation for the role you have played in taking the agenda of change forward in the NHS. First in Stephen Thornton and now in Gill Morgan you have strong advocates both for the NHS and for NHS reform. I am pleased that we are able to work so closely with you.

Last year I said at your conference that I wanted you to lead the negotiations for a new GPs contract. Those negotiations have gone well and thanks to the hard work both of yourselves and the BMA there is now the very real prospect of a new contract that is not only good for Britain’s family doctors but is good for NHS patients.

I hope we can build on what you have achieved in these negotiations. I want to move to a position where national negotiations over new contracts of employment are undertaken, not by the Department of Health, but by NHS employers acting collectively. Such a change would symbolise what I believe should be a new, more modern relationship between government and the health service – where devolution takes hold, where there is more power in the NHS and less in Whitehall. So that local health services can be more responsive to the needs and choices of patients.

I want to set out today the challenges facing the health service. And how I believe the NHS can rise to meet them. No-one should be in any doubt about the significance of the next few years for the NHS. It is make or break time. Either we prove that the NHS can change to become a service where the interests and choices of patients always come first or we reconcile ourselves to the fact that the NHS – great in principle – simply could not cut the mustard in practice in today’s world. I want to say unequivocally today that I have no doubt the NHS – with your help and leadership – will meet that challenge and can look to the future with confidence.

I say that in part because of the improvements already taking hold. I know too many of the stories in the newspapers are still focussed on what goes wrong rather than what is going right. Nobody in the NHS pretends there aren’t problems – there are – or that staff are not working under real pressure – they are. But the story the NHS should be telling in every community in the land is what it has been doing to put the problems right.

I want to pay tribute today to the staff of the NHS – not just the doctors and the nurses – but all the staff. The porters, the cooks, the cleaners, the scientists, the therapists, the secretaries, the managers and the administrators. They represent the very best of British public service and I believe that it is time we as a nation stood up and said that we are proud of the work you do.

There is good progress to report for which the NHS can justifiably be pleased. And the whole of the NHS can share in the achievements made.

In primary care, where waiting times are coming down. Where 10 million people can get out of hours care through a single phone call to NHS Direct. Where the prescribing of cholesterol-lowering drugs is up by one third. Tens of thousands of patients are receiving the latest drugs to combat cancer, heart disease, Alzheimer’s disease and arthritis. In the past year alone, death rates from cancer have fallen by 2 per cent., and from heart disease by 5 per cent.

In mental health services where in hundreds of communities new crisis and assertive outreach teams are in place providing services to thousands of vulnerable patients. In older people’s services where delayed discharges from hospitals are down, where more home based care is in place and where free nursing care is now the norm.

In ambulance services where today all but a handful are achieving the emergency response call time when just two years agor only a handful were achieving that.

In hospital services where a year ago people were having to wait up to 18 months for their hospital operation. Today the maximum wait at 15 months is moving towards the NHS Plan guarantee of a maximum 3 month wait. The number of people waiting more than 12 months for a hospital operation has fallen by one third in only one year. The number of people experiencing long waits for an out-patient appointment is the lowest on record. And for those with the most serious clinical conditions-cancer and heart disease-waiting times are lower still.

Yes, of course, there is a long way to go but the NHS is now beyond first base in delivering the NHS Plan. Each of these achievements has been hard won. There are many more challenges to come. Anyone who says there are no problems has clearly got it wrong. But those who say there has been no progress have got it totally wrong.

While they accuse the NHS of being a black hole which simply absorbs public money without return these critics should instead be pointing at dozens more hospitals, hundreds more beds, thousands more doctors, tens of thousands more nurses – and an NHS that is now on the up. They should go and see what I see in every hospital, health centre and surgery I visit. Not just the investment coming through but the reforms too – in how staff work and how services are organised.

The 10 year journey we mapped out in the NHS Plan is now firmly underway. And now we can move up a gear.

The Budget on April 17th marked a watershed for the NHS. And I don’t just mean the scale of the resources or the length of time for which they have been committed. Yes, against any historic benchmark they are generous. Five years of real terms growth averaging 7.5% will take health spending in our country beyond the EU average – an average which the cynics said we couldn’t even meet. It is worth remembering that just six years ago spending on the NHS was falling in real terms. By 2008 it will have doubled in real terms.

What is more, social services – for too long the poor relation – are to enjoy big rises in investment as well. Six years ago spending on social services was falling. Today it is rising by over 3% in real terms. We know that more is needed. We have listened to what local government, private sector care homes and local health services have all had to say. So now, spending on social services will double to 6% a year over and above inflation for the next three years.

I know there are many pressures and many demands. As we expand services after so many years of under-investment there will be growing pains along the way. But that is precisely what they are. The pains that come from growth. So no one should fall into the trap of saying that these unprecedented resources somehow bring problems when in fact they present the NHS with a huge opportunity.

The significance of what we have done should not be under-estimated by anyone in the NHS or outside. The Budget laid to rest a decades old fallacy – that we in Britain could have world class health care on the cheap. We can’t. The evidence is there for all to see. The run down buildings. The outdated equipment. The failure to invest in modern IT. The shortages of trained staff. The long waits that we inflict on patients.

We are bringing the decades of NHS neglect to an end. With the economy on a stable footing we can now put the NHS on a sustainable footing for the long term. We believe the time is now right to ask the British people to pay a bit more in tax to make the NHS a lot better for patients.

Make no mistake – when people are putting more in to the NHS they will expect to get more out. And rightly so. None of us can assume public confidence. Now more than ever we have got to earn it. As the reaction to the Budget has shown, there is overwhelming public support for the extra investment. But there is considerable public scepticism about the ability of the NHS to turn those resources into results for patients. A failure to deliver improvements will prompt only one response: not more money in the future for the NHS but less. Not collective provision of health care but more individual provision. Not the public sticking with the NHS but the public walking away.

You only have to read some of our newspapers to hear the voices of scepticism. Sometimes it is not just scepticism about the NHS. It is downright hostility. You can hear other voices too. Some in politics or in business who say the NHS precisely because it is run on public service principles can never actually deliver the goods for patients.

We have to prove those doubters wrong. And we have to do it together.

When we put taxes up to get more resources for the NHS – as people in the NHS urged us to do – we entered into a new contract with the people of our country. In exchange for extra resources we will deliver better results. Not just improvements in services for patients but services which are increasingly shaped by the informed choices of patients. Not the old style take it or leave it NHS of the last century but an NHS that is tune with the needs of this century – where services are responsive, where patients have choices, where quality always comes first. This is the challenge together we must now meet.

I believe that we are in a strong position to do so. NHS funding is secure. There is progress under way. There is a ten year NHS Plan, the cornerstone of all that we do. And there is a major programme of reform to match the programme of investment.

It is these reforms that are so crucial to the future of health care in our country. That are capable of making the NHS precisely the modern service that both patients and staff want to see.

These reforms began in our first term with the introduction of a new national framework of standards. As the Kennedy Report into the tragedy at Bristol confirmed, it was really the absence of national standards that was such a structural weakness in the NHS. Hence the NSF programme, the National Institute of Clinical Excellence, the system of clinical governance, the Modernisation Agency, the Commission for Health Improvement. All of this, designed to prevent bad practice and to spread good practice, so that patients everywhere get the care and treatment they need. Whatever doubts there might be about finer points of detail there is broad consensus that this new national architecture is right for the NHS and most importantly for NHS patients.

With this national framework in place, in this second term our core objective is to shift the centre of gravity in the NHS. As both the NHS Plan and our recent follow up command paper Delivering the NHS Plan make clear, it is right that standards are set nationally but it is wrong to try to run the NHS nationally. It is only frontline clinicians and managers in day to day contact with patients who can transform local services. This is something which the new strategic health authorities in their relationships with Primary Care Trusts will need to fully understand: the PCTs need to be helped and enabled not commanded or controlled. In turn, they need to devolve resources to their constituent practices from the growing proportion of the NHS budget the PCTs will control.

As the NHS Plan indicated a million strong service cannot be run from Whitehall. For patient choice to thrive it needs a different environment. One in which there is greater plurality in local services with the freedom to innovate and respond to patient needs.

It is an explicit objective of our reforms therefore to encourage greater diversity in provision and more choice for patients particularly for elective surgery. Hence primary care trusts having the explicit freedom to purchase care from the most appropriate provider – whether public, private or voluntary. From next April we will begin to move to a system of payment by results for NHS hospitals. Resources will follow the choices patients make so that hospitals who do more get more; those who do not, will not. Over the next four years an increasing proportion of each hospital’s income will come to it as a result of the choices patients make. For the first time in the NHS patients will be able to choose hospitals rather than hospitals choosing patients. That process will start this summer when patients waiting more than 6 months for a heart operation will be able to choose a faster waiting time in another hospital which has the capacity to treat them – whether it is public or private, on the doorstep or further afield, in this country or abroad.

Later this year we will also test in different parts of the country how patients with other conditions can exercise greater choice over where they are treated. We will want to work with the NHS in developing these policies – just as we have done in developing our thinking on NHS Foundation Trusts – so that by 2005 patients will be able to choose not just the location of their treatment but when to be treated and by whom.

This is the most fundamental change the NHS will have ever faced. It will mark an irreversible shift from the 1940s take it or leave it, top down service. Patients will be in the driving seat – and not before time. Of course different approaches will be needed to bring about improvements say, in emergency care or mental health services.

And more choice for patients, of course, requires more capacity in services. Patients can only choose to have an operation if a hospital is able to provide it. Consistent growth in staff numbers and in capital infrastructure will be needed if local NHS services are to expand patient choices and gain from the new system of financial incentives.

The biggest constraint the NHS faces is shortages of capacity. So I can tell this conference today that in addition to sustained growth in existing NHS provision, we will bring new providers from overseas into this country in order to further expand elective services for NHS patients.

A few have already started work in the NHS but as you know it is very early days. I can tell the Conference that we are now in discussions with a number of major overseas providers to bring clinical teams – in particular extra surgeons and other doctors – to this country. I can tell the Conference today, I will be meeting personally with prospective providers from both Europe and America over the course of the next few months with view to encouraging them to invest in England. They will concentrate on elective surgery in hard pressed specialties in those parts of the country where capacity constraints are greatest. I expect to see a growing number of these new providers in place beginning later this year. Like NHS use of existing private sector providers, this is not a temporary measure. These new providers will become a permanent feature of the new NHS landscape. They will provide NHS services to NHS patients according to NHS principles. And in the process they will open up more choices for patients and more diversity in provision.

These reforms are about redefining what we mean by the National Health Service. Changing it from a monolithic centrally run monopoly provider to a system where different health care providers – public, private, voluntary and not for profit – work to a common ethos, common standards and a common system of inspection. In such a system wherever patients are treated they remain NHS patients because they get care according to NHS principles – treatment that is free and available according to need not ability to pay. This is the modern definition of the NHS.

It is also a fundamental change. Not in how the NHS is funded or the values on which it is founded, but in how it is organised. NHS healthcare no longer always needs to always be delivered exclusively by line managed NHS organisations. The task of managing the NHS becomes one of overseeing a system not running an organisation. Responsibility for day to day management can be devolved to local services. None of this means the abandonment of national standards. Far from it. It is precisely because over these last five years we have put in place such a rigorous framework of standards nationally that the centre of gravity can now shift to how improvements can be delivered locally.

So while some advocate a false choice between national standards and local autonomy, the experience from elsewhere in Europe in the health sector, and from across the developed world in other economic sectors, is that securing improvements in performance requires both.

There is a simple deal on offer here. The better you do the more you get. It is a discipline that needs to work just as much in public services as in the private sector. I have lost count of the number of times I have been told by NHS managers and NHS clinicians alike that the NHS has got to stop bailing out the poorest performers and instead reward the better performers in the NHS in order to provide the right incentives for innovation and improvement to take hold across the whole of the NHS. And that is precisely what we must do if we are to translate the extra resources into real results for patients.

That is the reason for star rating the performance of local health services so that those who are doing less well get more help, those that are doing best get more freedom and those that are persistently failing feel the consequences. Where there are persistent problems we will step in. Where there is progress we will step back. At one end of the spectrum new management teams – whether from the public, voluntary or private sectors – will be brought in through the franchising process to turn round NHS organisations that are in trouble. At the other the best performers will become NHS Foundation Trusts legally free from Whitehall direction and control. Three star trusts will have less monitoring and greater freedom.

The more overall performance improves – as I am confident it will – the more autonomy will be earned across the NHS. That is what I want to see happen. We are at the start of a transition where more and more decisions about the NHS are taken locally rather than centrally.

It is time to unleash the spirit of public service enterprise that I know exists in so many parts of the NHS.

As in any large organisation some functions will need to be undertaken centrally but they should be strictly limited. The Department of Health will focus on setting strategic objectives, determining standards, distributing and accounting for resources and securing the integrity of the overall system through for example workforce planning and better IT. Overall the Department will be slimmed down as power and resources are devolved out of Whitehall. Some functions will move from the Department to the new Commission for Healthcare Audit and Inspection as the existing Commission for Health Improvement, National Care Standards Commission and the value for money work of the Audit Commission are brought together. The new CHAI will benefit from the comments that the Confederation and others in the NHS have made about avoiding bureaucracy and fragmentation but it will have the teeth to ensure that money is being spent wisely and that standards are improving.

Rather than trying to drive improvements through top down performance management the transition will be towards improvements being driven through greater local autonomy in which PCT commissioning, new financial incentives and the choices that patients make become the driving force for change with scrutiny through independent inspection. That transition will take time. It will require careful management and a new, more mature understanding about the relationship between government and the health service where the government does less and the NHS does more.

To help smooth that transition there are three areas where I hope government can help the NHS.

First, by focussing on the priorities for patients. If the NHS is to deliver for patients it has to remain focussed on what counts for patients. And the extra resources must be properly focussed too. The NHS does many things. There will be many pressures from many quarters for many good causes. But none of us will be forgiven if having raised the resources we fail to use them to get the results that both staff and patients want to see. Shorter waiting times. Higher clinical standards. Better health outcomes.

The public’s priorities have to be the health service’s priorities. Getting waiting times down in every aspect of NHS care from ambulances to diagnostics, from primary care to secondary care. Providing quick high quality emergency services not least in A&E. Making sure that the fundamentals are right – clean wards and safe care. Improving cancer, cardiac, mental health and elderly services.

These are the priorities. In time it is true we will develop further NSFs but only at a pace the NHS can properly absorb. I know the complaint in the service is that there are too many priorities and too many plans. I sometimes hear people say they cannot see the wood for the trees. It is true that sometimes in the rush to make change happen we have opted for the short cut of a dictat from Whitehall when what was needed was a longer discussion with the service. But in a public service like the NHS there has to be accountability to ensure that public money delivers the results that patients want to see whether that is matrons in charge of wards or shorter waiting times for treatment.

So national standards are necessary. Nobody wants to see a lottery in care where cancer patients are denied treatments in one part of the country which they are entitled to in another.

And targets are necessary – without them history shows that GP and hospital waiting times would not now be falling so consistently. But national standards and targets work best when they are focussed on key priorities.

Today I can announce some changes that will do just that. To begin with we will reduce the number of plans that local health services have to submit to the Department of Health.

At present the NHS is asked to produce scores of plans every year. We will be working with the NHS to review the number of these plans with a view to cutting their numbers by at least two thirds. If we can go further we will. In future planning will focus around delivering the core priorities. The same will be true of monitoring. The concentration will increasingly be on outcomes and outputs. That will allow the volume of overall guidance and monitoring to be reduced. We have already cut the number of circulars issued to the NHS each year and shortened the planning guidance. But senior staff still complain they receive too much clutter that does not help them focus on the core priorities.

So I can announce today that we will establish a panel of senior managers and clinicians from the NHS to act as a firebreak, to vet communications between the Department and local health services so they are limited to those that are absolutely necessary.

Secondly, I want to give the NHS the stability it needs to deliver the NHS Plan. The five year financial settlement that the health service has now got allows us to plan for the longer term particularly to meet the waiting time reductions planned for 2005. I can confirm to this Conference today that when we make financial allocations to PCTs this autumn they will receive funding not for a single year but for three years. Annual planning and annual target setting can become a thing of the past. Local health services will be able to concentrate on what needs to be done to bring about improvements over the medium rather than the short term.

Thirdly, stability will help local health services implement a sustained programme of expansion. It is time to go for growth. To use the large scale increases in both revenue and capital funding to expand capacity. To get the staff, the buildings, and the equipment the NHS needs. To shift the balance of services so that more patients can be seen in primary, community and social services, not just in hospitals.

To help this programme of expansion take hold locally there will be help nationally. As far as IT is concerned we urgently need to reverse almost two decades of failed attempts to modernise the NHS core infrastructure. So I can tell this conference today that later this summer we will bring forward a nationally run IT programme which will be backed by large scale investment.

Alongside the programme to bring overseas clinical teams to England we will be helping to establish the first generation of Diagnostic and Treatment Centres to separate elective from emergency work. Some will be run purely by the NHS, some by the private sector, some through partnerships between public and private.

To help the NHS focus on this longer term capacity building the next three years there will be a minimum amount of earmarking by the centre of local NHS resources. PCTs will have greater discretion over how growing NHS resources are spent.

These changes are all about helping the NHS to deliver. The national standards are in place. The resources are there. The NHS Plan is underway. There is a clear focus on what counts for patients.

We are in transition but the direction of travel is one way. Our supply side reforms – payment by results, freedom of commissioning, power to PCTs, NHS Foundation Trusts, plurality of provision – all lead towards a more devolved and more diverse health service where patients have greater choice.

You know transition takes time. I know that. So does bringing about improvement. Public expectations are high. But they also need to be reasonable. People need to understand that a 10 year plan is exactly what it says. It will take time to be delivered in full. But the NHS has to prove – not in five years time or in ten – but over this coming year that progress is underway in every part of the service.

The Budget this year represents an enormous vote of confidence in all of you, in the whole of the health service.

The ethos of the NHS and its staff express the values of our nation. Some have said that the Budget is a gamble. In some people’s minds it may be. But not in mine. I wouldn’t have fought so hard for the resources we’ve now got if I thought there was a better way of providing health care for our country. For me there is no better way than a tax funded, well funded NHS.

It is a genuine One Nation policy that puts need before ability to pay. Quite simply in a world where health care can do more – but costs more- than ever before the NHS should be supported with our heads as well as our hearts.

With the investment now secured, with the reforms now taking place, with the brilliance of our staff, I can tell this conference without a moments hesitation: I believe the best days of the NHS are ahead of us not behind us. I believe that investment plus reform does equal results.

And above all, I believe that you can do it.

Alan Milburn – 2002 Speech on NHS Foundation Hospitals

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 22 May 2002.

Thank you for coming – and particularly to our guests from Denmark, Spain and Sweden. This is a unique event. A gathering of existing “Foundation” hospitals from other European countries and of prospective Foundation hospitals from this country. We have brought you together to learn from the successes that have been achieved elsewhere in Europe. To understand how the autonomy that hospitals enjoy there and that have brought improvements in care for patients could work here. Today’s event takes place against the backdrop of the recent Budget that has put funding for healthcare in Britain on a sustainable footing for the long term. Today the NHS is the fastest growing health care system of any major European country. There is of course a huge amount of catching up to do. After decades when under-investment put Britain behind the rest of Europe now we can have the ambition as country to be up with the best. In Europe and across the developed world, every country faces similar challenges in health care – growing public expectations, advances in treatments, changes in populations. Everywhere reform is on the agenda. There is a wide ranging debate taking place about the future of health care. In essence this debate revolves around two central questions. First how health care is funded. Second how it is organised. On the first the Government’s decision to double health service spending in real terms by 2008 from the position we inherited in 1997 is a declaration of faith in the NHS. With the right level of funding we believe it can be the best insurance policy in the world. No health care system comes for free. Improvements in health care have to be paid for. Through general taxation, social insurance, private insurance, charges or a mix of approaches. We believe that the benefit of a tax-funded well funded NHS is that it is an insurance policy that comes with no ifs and no buts: whatever your illness, however long it lasts you get cover as long as you need it. In a world where healthcare can do more but costs more than ever before, the NHS precisely because it provides care that is free, according to need not ability to pay, should in our view be supported with our heads as well as our hearts. So while others say we should adopt the system of funding from elsewhere in Europe we say those countries have not enjoyed a superior system of funding but a superior level of funding. The lessons to be learned from the rest of Europe are less about how health care is funded but more about what level of funding and what form of organisation is needed to translate resources into results for patients. For what is patently clear is that elsewhere in Europe health care systems have not only benefited from more resources but from a different way of being run. The NHS has great strengths in how it is organised. Its ethos and its staff express the values of our nation.

1. Thank you for coming – and particularly to our guests from Denmark, Spain and Sweden. This is a unique event. A gathering of existing “Foundation” hospitals from other European countries and of prospective Foundation hospitals from this country. We have brought you together to learn from the successes that have been achieved elsewhere in Europe. To understand how the autonomy that hospitals enjoy there and that have brought improvements in care for patients could work here.

2. Today’s event takes place against the backdrop of the recent Budget that has put funding for healthcare in Britain on a sustainable footing for the long term. Today the NHS is the fastest growing health care system of any major European country. There is of course a huge amount of catching up to do. After decades when under-investment put Britain behind the rest of Europe now we can have the ambition as country to be up with the best.

3. In Europe and across the developed world, every country faces similar challenges in health care – growing public expectations, advances in treatments, changes in populations. Everywhere reform is on the agenda. There is a wide ranging debate taking place about the future of health care. In essence this debate revolves around two central questions. First how health care is funded. Second how it is organised.

4. On the first the Government’s decision to double health service spending in real terms by 2008 from the position we inherited in 1997 is a declaration of faith in the NHS. With the right level of funding we believe it can be the best insurance policy in the world.

5. No health care system comes for free. Improvements in health care have to be paid for. Through general taxation, social insurance, private insurance, charges or a mix of approaches. We believe that the benefit of a tax-funded well funded NHS is that it is an insurance policy that comes with no ifs and no buts: whatever your illness, however long it lasts you get cover as long as you need it. In a world where healthcare can do more but costs more than ever before, the NHS precisely because it provides care that is free, according to need not ability to pay, should in our view be supported with our heads as well as our hearts. So while others say we should adopt the system of funding from elsewhere in Europe we say those countries have not enjoyed a superior system of funding but a superior level of funding.

6. The lessons to be learned from the rest of Europe are less about how health care is funded but more about what level of funding and what form of organisation is needed to translate resources into results for patients. For what is patently clear is that elsewhere in Europe health care systems have not only benefited from more resources but from a different way of being run.

7. The NHS has great strengths in how it is organised. Its ethos and its staff express the values of our nation. Its unitary structure gives it great advantages both in overall levels of efficiency and in its focus on public health for example. Its primary care services, led by Britain’s family doctors, are the envy of many other countries. However, in addition to its long standing capacity problems, the NHS has great structural weaknesses too – not least its top down centralised system that tends to inhibit local innovation and its monolithic structure that denies patients choice. These weaknesses are a product of the health service’s history. At the time the NHS was being formed as a nationalised industry in the UK elsewhere in Europe many socialist or social democrat governments were creating institutions which favoured greater community ownership over state ownership. Whereas in the UK’s health care system there is uniformity of ownership, in many other European countries there are many not-for profit, voluntary, church or charity-run hospitals all providing care to the public health care system. There are private sector organisations doing the same. As other European nations testify there is no automatic correlation that tax-funded health care has to mean health care supply run purely by central government. Tax funded health care can sit side by side with decentralisation, diversity and choice.

8. There are important lessons to be learned in this country from the more diverse European model of provision. When I visited the Alcorcon hospital in Madrid last year for example I was struck by the fact that the greater independence it enjoyed from the rest of the state run health system had given patients there faster waiting times and improved outcomes despite dealing with a more severe case mix than comparable state run hospitals. As we will hear from our international colleagues today greater independence has improved performance in hospitals across Europe. Why? Because whatever the profession or walk of life, people perform best when they have control. Giving local organisations greater freedom helps promote innovation and encourages enterprise. In the NHS that is particularly important because of the high level of skills and knowledge that clinicians and managers have. Releasing their talents – and those of other staff – is the key to better health care.

9. Our reform programme for the NHS in this country needs to absorb some of these lessons. As the NHS Plan indicated a million strong service cannot be run from Whitehall. For patient choice to thrive it needs a different environment. One in which there is greater plurality in local services which have the freedom to innovate and respond to patient needs. It is an explicit objective of our reforms therefore to encourage greater diversity in provision and more choice for patients. Hence new providers from overseas being brought into this country – alongside greater use of existing private sector providers – to expand capacity for NHS patients. Primary care trusts having the explicit freedom to purchase care from the most appropriate provider – be they public, private or voluntary. Hospitals to be paid by results with resources following the choices that patients make so that hospitals who do more get more; those who do not, will not.

10. These reforms are about redefining what we mean by the National Health Service. Changing it from a monolithic centrally run monopoly provider to a system where different health care providers – public, private, voluntary and not for profit – work to a common ethos, common standards and a common system of inspection. In such a system wherever patients are treated they remain NHS patients because they get care according to NHS principles – treatment that is free and available according to need not their ability to pay. This is the modern definition of the NHS.

11. It is also a fundamental change. Not in how the NHS is funded or the values on which it is founded, but in how it is organised. NHS healthcare no longer needs to always be delivered exclusively by line managed NHS organisations. The task of managing the NHS becomes one of overseeing a system not running an organisation. Responsibility for day to day management can be devolved to local services. None of this means the abandonment of national standards. Far from it. It is precisely because over these last five years we have put in place such a rigorous framework of standards nationally that the centre of gravity can now shift to how improvements can be delivered locally. So while some advocate a false choice between national standards and local autonomy, the experience from elsewhere in Europe in the health sector and from across the developed world in other economic sectors, is that securing improvements in performance actually requires both.

12. As both the NHS Plan and our recent follow up command paper Delivering the NHS Plan make clear, it is right that standards are set nationally but it is wrong to try to run the NHS nationally. It is only frontline clinicians and managers in day to day contact with patients who can transform local services. That is why Primary Care Trusts are being given control over 75% of NHS resources. Why we look to PCTs in turn to devolve to their constituent practices. It is the reason for star rating the performance of local health services so that those who are doing less well get more help and those doing best get more freedom. And it is why we want to set up NHS Foundation Trusts with the local flexibility and freedom to improve services for patients without day to day interference from Whitehall.

13. In January this year I announced that we were developing plans to enable the best performing NHS organisations to become NHS Foundation Trusts. Since January my officials have been working with the chief executives of three star trusts and others to develop these ideas. They have also been looking at how services are organised in other countries and the lessons we can learn from them.

14. I can set out today how we now plan to proceed to establish NHS Foundation Trusts. First of all in the summer we will set out how NHS trusts can apply for foundation status and the criteria that will be used to assess applications. Decisions on the first NHS Foundation Trusts will be made in the autumn. The first wave will be selected from those that achieve three star ratings this July. They will need to demonstrate that they have the management capability and clinical support to make a success of NHS Foundation Trust status, and that they have the support of the local PCTs who commission services from them. They will need to show how they will use their freedoms to demonstrate rapid progress in delivering the NHS Plan.

15. A number of existing three star Trusts have given firm expressions of interest in joining the first wave of NHS Foundation Trusts. They are Northumbria Healthcare NHS Trust, Peterborough Hospitals NHS Trust, Norfolk and Norwich University Hospital NHS Trust and Addenbrooke’s NHS Trust.

16. If these Trusts are successful in meeting the criteria they and others who come forward will start operating as shadow NHS Foundation Trusts in April next year. I can also say that we intend to legislate to enshrine in statute the freedoms and responsibilities that NHS Foundation Trusts will have. Subject to legislation I expect the first of them to become fully operational before the end of next year. As performance across the NHS improves so more autonomy will be earned by more local NHS organisations.

17. NHS Foundation Trusts will operate in a quite different way from existing NHS Trusts. NHS Trusts were supposed to guarantee self governing status. In fact they were at best a half way house and at worst a sham. Trust status promised independence but in practice didn’t guarantee it. In reality their legal status – with direct accountability to Ministers – meant that Whitehall continued to hold on to the purse strings, maintained the powers of direction and continued to run the NHS as it had been since 1948. The challenge now must be to genuinely free the very best NHS hospitals from direct Whitehall control.

18. We plan to do this firstly by removing the Secretary of State’s powers of direction over NHS Foundation Trusts. Instead of being line managed by the Department of Health, they will be held to account through agreements and cash for performance contracts they negotiate with PCTs and other commissioners as well as through independent inspection. These contracts will reflect national priorities around reduced waiting times and improved clinical outcomes. The expectation must be that the greater freedoms that NHS Foundation Trusts will enjoy will help them exceed national performance targets but that will be a matter for local not national negotiation. Those that perform well will benefit from the system of payment by results and patient choice that we announced in Delivering the NHS Plan.

19. There will of course need to be appropriate safeguards in place. NHS Foundation Trusts will operate according to NHS principles. They are there to serve NHS patients by providing high quality care that is free and delivered according to need not ability to pay. They will be subject to inspection by the new Commission for Healthcare Audit and Inspection (CHAI). The Commission will play a key role in assessing performance and in reassuring patients and the public that national standards of service and quality have been met wherever care is provided. Strengthening arrangements for audit and inspection through CHAI are an essential complement to increased provider plurality, including the setting up of NHS Foundation Trusts.

20. CHAI – rather than the Department of Health – will therefore take on the function of regulating NHS Foundation Trusts and stepping in to take necessary action to protect patients and the public.

21. Secondly, we intend to establish NHS Foundation Trusts as free-standing legal entities which are indeed free from direction by the Secretary of State. We are currently exploring a number of options about how best to establish NHS Foundation Trusts in law. In particular there has been growing interest in recent years in developing the concept of the public interest company – a middle ground within public services between state-run public and shareholder-led private structures. Organisations as diverse as the Co-operative Movement and the Institute of Directors have made the case for such organisations on the basis that they have a clear public service ethos and are not for profit. These organisations are based firmly within the public service with their assets remaining within public ownership and being protected against takeover by the private sector. They are toughly regulated but not externally controlled. They open up more potential for both staff and public involvement.

22. We are continuing to actively explore the best option here based on a firm principle that should guide us. As national control over day to day management of these NHS hospitals ceases so local community input will need to be strengthened. NHS Foundation Trusts will have the ability to develop governance arrangements that enable patients and the public to play a more effective part in the running of the NHS at a local level. The NHS is a national service but it is delivered locally. The relationships that count most are those between the local patient and the local clinician, the local community and the local hospital. 1948 silenced the voice of the local community in the NHS. It is time it was heard again.

23. We are exploring how best this could be done. One potential model would involve local members of the community sitting alongside other key stakeholders such as hospital staff, local businesses, local authorities and, where appropriate, universities as lay governors. In this model day to day management of the NHS Foundation Trust would rest in a separate board including the chief executive and other senior staff such as clinical leaders. However they are constituted NHS Foundation Trusts will remain part of the NHS family but with local freedom from national control.

24. Thirdly, then, NHS Foundation Trusts will be freed up from having to respond to an excessive number of prescriptive central demands, guidance and reporting arrangements. As free-standing organisations they will be held to account through the commissioning process rather than through day to day line management from Whitehall. They will have the freedom to retain proceeds from land sales to invest in new services for patients. We are exploring how we can increase their freedom to access finance for capital investment under a prudential borrowing regime modelled on similar principles to that being developed for local government. The intention is that they will have greater freedom to decide what they can afford to borrow and they will be able to make their own decisions about future capital investment. They will be able to use the flexibilities of the new pay system we are currently negotiating to modernise the workforce including developing additional rewards for those staff who are contributing most. Exercising these freedoms will give NHS Foundation Trusts precisely the sort of autonomy that is commonplace for hospitals elsewhere in Europe.

25. Some say this is a form of backdoor privatisation. That is utter nonsense. There will be a lock on the assets of NHS Foundation Trusts so that they work for NHS patients. Their purpose will be to provide NHS services to NHS patients according to NHS principles. They will be governed by people from the local community instead of by the state or by shareholders. They will be part of the wider NHS family. They are all about unleashing the spirit of public service enterprise that exists within the NHS but for too long has been stifled.

26. NHS Foundation Trusts will help create a radically different health service. One that is true to its values but is changed in its structures. One that learns the lessons from what has worked elsewhere in Europe. I want to thank our international speakers who are here today to share their experience and their insights with us. I know that there is more we can learn from them as we develop our approach. I would also like to thank people from the NHS who have been working with us to develop our thinking on NHS Foundation Trusts. The development of policy in this area I believe exemplifies a new way of doing business between the Department and the NHS. It is one that I hope we can build on for the future.

Alan Milburn – 2002 Speech to the Royal College of Nursing Congress

Below is the text of the speech made by Alan Milburn, the then Secretary of State of Health, on on 24 April 2002.

It is a pleasure to be here today – especially on a day when you are focussing on the needs of student nurses. It is right today that as we plan for the future generation of nurses we can plan with confidence the future of the NHS.

It is two years since I was last at your Congress. Since then, quite a lot has changed, for the RCN and for the NHS. You have a new General Secretary. Beverley is a powerful advocate for nurses and for patients. I am grateful for the role she plays and I believe you have every reason to be proud of the leadership she shows.

I said two years ago I shared an ambition with you: to get more members for the RCN because I wanted to see more nurses in the NHS. Two years later, there are 16,000 more members of the RCN because there are 20,000 more nurses in the NHS.

After years when nurse numbers fell and when training numbers fell too, nurse numbers in the NHS are now rising and are set to go on rising for many years to come.

There are of course huge problems still in the NHS. Decades of under-investment still take their daily toll on frontline services and frontline staff. Nurses work under huge pressure. I know that because I hear it and see it wherever I go. I know too the pressures and frustrations brought by staff shortages or by equipment failures or by lack of IT support.

I know the pressures are real – and today I want to set out how we can address them together. In the last few years we’ve made a start. Waiting times are still too long – but they are falling. Cancer equipment is still too old – but it is improving. Hospital buildings are still in disrepair- but the biggest programme of new building is underway. Staff shortages are still there for all to see – but the NHS Plan target for 20,000 more nurses has been delivered – and delivered two years early.

The NHS Plan we prepared and published with your help is a programme for ten years not for two. The truth is we are at first base in what will be a long haul to improve services for patients. But step-by-step we are making progress. And we can now build on the foundations that you have helped to lay.

Whether you work in the health service or the independent sector, in mental health or in the community, whether you are a student or a sister, a matron or a midwife, up and down the country nurses at every level are making a difference for patients every hour of every day.

It is tough out there and the problems that are real have to be tackled. But we also have to have some balance, particularly in the media debate on the NHS.

Nothing makes me more angry than when stories in some of the papers give the impression that no patient ever gets good treatment. Or when the false charge is made that nurses treat patients worse than dogs. Or that the NHS is full of bad nurses, or bad doctors, when it is in fact full of good people doing their best for patients.

In a service treating millions of people every week, there will always be cases where things go wrong but, thanks to your efforts, for most patients most of the time things go right. Most staff do a good job. And I’ve got a simple maxim: if you are on the side of the people who use the NHS you’ve got to be on the side of the people who work in the NHS.

So today I want to set out what the future holds for the health service – for staff and for patients. And because nursing values are health service values, I will set out the leading role I want nurses to play in changing the health service – and changing it for good.

Today we can look to the future with confidence. Last week’s Budget gives the NHS the best chance it has ever had – perhaps the last chance it will have – to transform health care in our country. For decades we have lagged behind the rest in Europe. Now we have the chance to be up with the best.

Funding for the NHS – already growing faster than in any other major European country – is now set to grow by over £40 billion. It is the biggest increase in NHS resources the country has ever seen. Where there used to be funding for just one year there will now be funding for sustained increases for the next five.

And the same is true of social care. For too long nurses know social services have been the poor relation of health services. Health and social care are two sides of the same coin. They both rely on each other. Older people rely on both. So I can confirm today that funding for social care, which just five years ago was rising by less than 1% above inflation a year, is now set to rise by 6% a year for the next three years.

The Budget is a profound moment of choice for our country. It puts behind us the decades of pretence that Britain could get world class health care on the cheap. That was our nation’s impossible dream.

But it was just that: a dream. If we want world class health care it has got to be paid for. And I believe the best and fairest way of providing health care for country is a tax-funded, well-funded NHS.

The NHS is an insurance policy that comes with no ifs and no buts, no small print, no get-out clauses. It is based on the scale of your need not the size of your wallet. So we should support the NHS with our heads as well as our hearts.

Some say that what we did in the Budget is a gamble. Well maybe it is. But I believe it is now right to ask the British people to pay a little more for the health service so that we can get a lot more for patients.

And when the British people are being asked to put more in, they have every right to expect more out.

So the Government has an ‘acid test’ for health investment. It is this: the extra investment has to secure an expansion in capacity or an increase in productivity or an improvement in performance.

Against this ‘acid test’ we expect to be judged. Against this test the NHS can expect to be judged.

Raising the money required discipline – sorting out the public finances, putting the economy on an even keel. Spending the money requires discipline, too.

There will be many pressures from many quarters for many good causes. But we will not be forgiven – and the NHS will not be forgiven – if having raised the resources we fail to use them to get the results that both nurses and patients want to see. Shorter waiting times. Higher clinical standards. Better health outcomes.

So we will focus the extra resources where they will count most for patients. Expanded capacity means more nurses and doctors, scientists and therapists, more beds and buildings.

We need more investment in more modern hospitals and health centres, better equipment and, of course, IT systems that might just actually work.

Investment will help to reduce the waiting times for treatment and investment needs to be focussed not just on treatment but in prevention.

Our job in government is to provide opportunities for all and not just some in our society. So improvements in cancer, heart disease, mental health and care of the elderly will remain our key priorities.

Investment here will help to improve health outcomes and tackle the health inequalities that are such a scar on the face of our nation.

So investment will be focussed not just in hospital services but in primary and community services too. To create the modern health service we need we have to shift the balance of services in the NHS. The problems of hospitals can not be solved solely in hospitals.

Tackling waiting in the A&E and in the outpatients department of course requires more staff and new equipment. But it requires better help and more support in the community, in primary care and in social services.

Social services will be able to extend by a third the number of older people with access to rehabilitation. There will be extra resources to stabilise the care home market and to buy more care home beds. And we can now set ourselves the objective, not just of giving older people a choice of care in a care home but of increasing the number of people who can be cared for in their own home.

The point is this. Everywhere I go, virtually every nurse I speak to says: things can not just go on as they are. And you’re right.

The new money cannot be just for more of the same. It has to buy a different sort of health service. It has to meet the ‘acid test’ of expanded capacity, increased productivity and improved performance.

That’s why the reforms we implement are as important as the resources we invest. Only if we now have the courage to match reforms with resources will we get the best results for patients.

So as we expand capacity for patients we must expand choices for patients. So that for the first time in fifty years NHS patients are able to make an informed choice about where they are treated and when they are treated.

So that we pay hospitals by results – with more resources for treating more patients, more quickly and to higher standards.

So that social services are paid by results too – for ending the misery of bed blocking, using their extra resources to expand community support to the elderly patient in need.

So that the services that are struggling – rather than being left to sink or swim, as they were under the old internal market – are helped and supported and yes, where necessary are taken over by management with a track record of success.

So that we get the public, private and voluntary sectors working for a common cause – improved services for NHS patients.

None of these changes can happen through Government action alone. We can secure the resources. We can help set the standards. We can hold the system to account. But in the end I do not treat a single patient. You do that. So I need your help, not for political reasons (still less for party political ones). But because nurses make the difference for patients.

Nurses above all others are the frontline in the NHS. Alongside your colleagues in medicine and the other professions, you are uniquely placed to help translate the extra resources into results for patients.

Make no mistake about it there is a bruising battle ahead. The cynics and the critics say that to choose the NHS is the wrong choice for Britain. That the health service is not working and that it can never work.

The Government is on test – of course we are. And we are happy to be judged against the improvements we have promised. But there is a bigger test than the political one. It is whether the NHS itself can deliver. The public want to know that if they put more resources in we can get more results out. That the NHS can meet this ‘acid test’.

I am one hundred per cent confident that the NHS will deliver. Why? Because I know NHS staff are one hundred per cent committed to delivering improvements for patients.

And it is nurses who are leading this process of reform. Reform is happening out there because you are making it happen.

Nurses who are now running clinics, triaging patients, discharging patients, prescribing medicines, running walk-in centres. Nurses the first point of call already for 10 million patients through NHS Direct. Nursing doing jobs previously only done by doctors. And now, through PMS, for the first time, nurses in charge of doctors.

And this meets our ‘acid test’: liberating the talents of nurses helps to expand the overall capacity of the NHS, increases the productivity of the NHS and improves the performance of the NHS.

Liberating the talents of nurses quite simply means better care for patients. And in the last few years, nurses have carried the torch for change.

We share between us – the profession and the government – a common aim: to get the best from nurses so that we can get the best for patients. Now we look to strengthen our partnership so that we can go further still. To make sure that we liberate the potential not just of some nurses but of every nurse.

There are five further steps I believe we should now take to realise our shared ambition:

First, to get the best from every nurse we need to get more nurses working in the NHS.

A start has been made. And I want to thank you for the help you have given us so far in our recruitment campaign. Since 1997, over 11,000 nurses who left the NHS have been encouraged to return. 2,000 more are on their way back. In total the number of nurses working in the health service has risen by 31,000. That is good progress. But there is more to do.

So I can confirm today that we plan over these next five years to increase again the total number of nurses working in the NHS by a further 35,000.

Applications for nurse diploma courses have doubled. Nursing degrees are now the second most popular university course in the country. And I can confirm that these increases in training mean by 2008 there will be 60% more nurses qualifying each year than there are today.

And we will continue to bring back nurses who have left the NHS and to recruit some nurses from abroad. And I can give this assurance today, where we do we will not actively recruit from developing countries. Those countries need their nurses more than we do.

Like many of you I have been appalled by reports of nurses being dishonestly recruited abroad, for a fee, by private agencies, coming to this country and then finding themselves exploited.

So I can announce today that to tackle this exploitation we will establish a national helpline for these overseas nurses so we can get them out of dead-end jobs, match their skills to NHS jobs, make them an NHS employee and end their exploitation.

But getting more nurses into the NHS is just one part of the story. We may have turned the corner on nurse recruitment but what we cannot have is nurses coming in through the front door only to find more nurses leaving by the back door. The emphasis now has to shift to retaining nurses as well as recruiting them.

So second, as the RCN constantly reminds us, we can only expand the number of nurses in the NHS if we improve the working lives of nurses already in the NHS. A start has been made but much, much more needs to be done.

The NHS won’t get better treatment for patients unless it offers better treatment for staff. And the truth is some NHS employers are better at it than others. You can see that in vacancy rates where in one trust the nurse vacancy rate is 8% whilst in the next door trust it is less than half of one per cent.

Nurses often have two jobs – one at home and one at work. The NHS has got to do more to help nurses balance their family and their working lives. Some employers are already doing that offering more flexible hours and better childcare. But some are not.

When I met with a group of nurse returners earlier this year their message to me was that improving working lives should be a priority for every chief executive in every trust in every part of the country.

So today I can confirm that in future the star ratings system for NHS employers will include an assessment of how well the staff are treated and how well they are involved.

Beverly, you asked on Monday for a guarantee that every NHS employee would have access to a child care co-ordinator.

Now, I can’t promise you’ll always get everything you ask for – you know that – but I can promise that by April next year every nurse will get the child care help you called for.

And today I can go further still to extend nurses’ access to practical childcare support. As you know we plan to invest an extra £100 million in childcare for NHS staff. So far, the intention has been for this to be targeted only at qualified nurses. Today I can announce that it is our intention, within two years, to make subsidised childcare available not only to qualified nurses but to student nurses as well.

This is investment in nursing. In the future of nursing. In the future of the NHS. And to those who say that there is a choice between investing in staff or investing in services, I say in the NHS unless we invest in staff we will not get better services for patients.

Third, then that brings me to the question of pay.

Every nurse deserves fair pay.

In the past nurses pay was staged. Now it is being paid in full.

Three years ago we increased the starting pay of newly qualified nurses by 12%.

Two years ago staff nurses had increases of almost 8%.

Last year ward sisters and charge nurses got over 5%.

Since 1997, nurse pay has risen faster than average earnings.

And nurses deserve a fair deal over the years to come.

Investment in pay, just like every other area of future NHS spending has to pass our ‘acid test’ – it must contribute to expansion in NHS capacity, it must bring about increases in NHS productivity and it must deliver improved NHS performance.

As the Chancellor said in his Budget Statement last week, “sustained commitment to better public services demands responsibility in setting public sector pay.”

As you know, we have been negotiating a new pay system for nurses and for other staff. The Agenda for Change discussions have been long and hard.

I am grateful both for your participation and for your patience. I know there have been concerns about our commitment to Agenda for Change.

So I can confirm today, that we are fully committed to Agenda For Change; we want now to move to conclude the negotiations; and providing we can reach agreement we will start to implement Agenda For Change by the end of this year.

But let me just say this: this will not be a something for nothing arrangement. Agenda for Change is all about paying people according to what they do. The more they do the more they can get. As nurses take on new roles and responsibilities they have a right to expect a fair reward. In return the NHS has a responsibility to gain improvements in flexibility and productivity. This must be a something for something arrangement.

It will take time and effort to fully implement the new pay system but, providing we can reach agreement, we can deliver a better deal for Britain’s nurses.

Fourthly, we know that if we are to get improvements in flexibility and productivity, the NHS has to change traditional working practices to help more nurses smash through the glass ceiling that has held them back for too long. There simply have to be better career prospects for all NHS nurses.

There are already 700 nurse consultants, 2000 modern matrons. They are showing that nurses can break through that glass ceiling. If it can be done in some parts of the health service it can be done in all parts of the health service.

So you have a job to do to challenge the structures in your own NHS organisations. To argue for better use of nursing skills. To say that it is good for doctors and good for patients to unlock the talents of nurses. And I want to help, if I can.

So I can announce a major expansion in an area of clinical practice that matters both to nurses and to patients – and I know it matters to the RCN. Today there are 23,000 nurses who are able to prescribe drugs to patients. Within two years we expect there to be more than 30,000 independent nurse prescribers but we need to go further and we need to go faster.

I can tell you today I have asked the Chief Nursing Officer to draw up proposals to extend the range of drugs and medicines these nurses are able to independently prescribe.

I can also announce today that it is now our intention to ensure that every nurse who wants to, and is trained to, is able to prescribe appropriate drugs and medicines to patients.

Last week we issued a consultation document on supplementary prescribing. We await your response with interest.

We now propose that supplementary prescribing should have no formulary, no restricted list of drugs, no restriction on the location or the type of practitioner other than that they are registered and qualified and safe to prescribe. Prescribing will be limited only by the individual patient’s clinical plan. I expect the first supplementary nurse prescribers to be in training by the end of this year.

And I can also say today that we will embed these reforms for the long term. So I have asked the CNO to work with the Nursing and Midwifery Council and Higher Education to review and reform nurse pre-registration training so that in future nurse prescribing can be enshrined in the training of every single newly qualified nurse.

Let us be clear: these proposals represent a fundamental change in traditional working practices in the NHS. What once was the sole preserve of the doctor will now become a shared responsibility between nurses and doctors together. It will be good for nurses, good for doctors and above all else it will be good for patients.

So those who say nurses can not lead or should not lead should think again. Nurses are leading, others can lead and in the future many more will lead.

Fifth, then, to get more nurses leading requires better training. Nurses should not have to struggle alone against the odds to make the reforms the NHS needs. Every nurse who wants to lead change should be supported to do so.

When I last spoke at your Congress two years ago, I announced then the largest ever investment in leadership development for nurses. Since then over 20,000 nurses have completed leadership programmes such as the LEO or the RCN’s own clinical leadership programme.

By October this year over 30,000 will have done so. The nurses I have spoken to say these training opportunities have given them the skills and the confidence to change services for patients. Indeed one ward sister I spoke to last time I was visiting Harrogate told me how she was so inspired by what she had learned that she has now become a course tutor to pass on the benefits she had received to other nurses.

Today I want to build on that nurse’s experience – and I want to extend opportunities to many more nurses. I can announce that over the next two years, the current leadership programmes will be extended to 50,000 D&E grade nurses.

The RCN clinical leaders programme will also be extended to a further 100 trusts including primary care trusts.

In addition I have asked the NHS Leadership Centre to provide e-learning programmes to tens of thousands more nurses, opening up new opportunities, particularly for nurses with family commitments. And I can announce today that I have asked the Chief Executive of the new NHS University to make nurse training an early priority in its work programme.

These five changes – more nurses, better working lives, fairer pay, improved career prospects, enhanced training opportunities – big changes – all amount to one thing: more power for nurses to improve services for patients.

As Beverley rightly puts it – you are the glue that binds the NHS together. Day-in, day-out you are on the frontline of patient care. I want to help you create a patient-centred service.

That is why nurses are in leadership positions in PCTs. It is why ward sisters have been given greater control over ward budgets. Why modern matrons have been given the clout to get the fundamentals of care – good food and clean wards – right for patients.

All of this is about putting power in the hands of the NHS frontline. The NHS can not be run from Whitehall. We have got the national standards and shortly we’ll have a tougher inspection system in place. So it is now time for Whitehall to let go. It is time to let nurses take more control.

Last week we announced the biggest ever funding package for the health service. Today I have announced reforms to extend and expand the power of nurses. To change traditional working practices.

On their own they represent important new opportunities. Together, this investment and these reforms can deliver a better NHS.

I won’t stand here and promise something I can’t deliver. I told you we would get more resources for the NHS and we have. I have told you we will deliver a fair deal for nurses and we will.

I want you to know we will keep faith with Britain’s nurses as you kept faith with the NHS through all the difficult years of cutbacks and closures.

No one is promising you there won’t be pressures or problems. No one is saying every difficulty and every demand will be met.

No one is pretending everyone will be happy.

Real life simply isn’t like that.

But what I can say is that with this level of investment, with these reforms, with your help, the best days of the NHS can be ahead of us, not behind us.

Together I know we will deliver for patients.

Alan Milburn – 2002 Speech on the NHS Plan

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, to the House of Commons in London on 18 April 2002.

With permission, Mr. Deputy Speaker, I wish to make a statement on the next steps on the NHS plan. I am today laying before Parliament a Command Paper setting out those next steps, copies of which have been placed in the Vote Office.

The NHS plan that we published in July 2000 set out a 10-year programme to rebuild and renew the health service in our country. It diagnosed the NHS problem as follows. The principles of the NHS are right-on this side of the House we believe in an NHS that is free at the point of use, funded from general taxation, and based on need, not ability to pay. But today’s NHS is the product of decades of underinvestment. It is also the product of a failure to reform. Staff-the greatest asset that the health service has-work flat out in a system which still too much resembles that of the 1940s. The NHS plan set out a 10-year programme of investment and reform based on clear national standards, more devolution of resources, greater flexibility for staff and more choice for patients.

With the economy stabilised and the public finances sorted out, the 2000 spending review was able to give the NHS the largest ever real-terms increases in resources. Two years later, anyone who says that there are no problems in the NHS has clearly got it wrong, but those who say there has been no progress have also got it wrong. Yes, there is a long way to go-it is a 10-year plan-but those who point to an NHS black hole should in fact be pointing to dozens more hospitals, hundreds more beds, thousands more doctors, tens of thousands more nurses-and a better health service as a result.

In July 2000, we acknowledged that three years of sustained funding was not enough. My right hon. Friend the Prime Minister had already said in January 2000 that we needed to match European Union levels of spending. Yesterday, my right hon. Friend the Chancellor of the Exchequer put NHS finances on a sustained footing, not for three years, but for five. Years of failure to invest in the past are now being replaced with years of investment for the future. Today, I can tell the House what that investment will give us: 35,000 more nurses, 15,000 more doctors, 40 new hospitals and 500 primary care centres. As investment grows, so the capacity of the NHS will grow.

Investment in the NHS must, however, be accompanied by changes in the way in which the NHS works. Ours is not an unconditional offer. Without those reforms, we will not get the best use of the money for the taxpayer and we will not get the improvements in service for the patient. Where we have had the courage to invest, we must now have the courage to reform. Our formula is simple: investment plus reform equals results.

First, building on the national standards already in the NHS plan, we will strengthen the system of inspection and audit to improve accountability to patients and the public. Where more resources are going in, people have the right to know what they are getting out. We will therefore legislate to establish a new Commission for Healthcare Audit and Inspection to inspect and to raise standards in health care across our country. We are clear that we need higher standards in NHS hospitals and also in private hospitals.

The commission will assess the performance of every part of the NHS so that the public can see that every extra pound in the NHS buys something better for patients and gets something more for taxpayers. Similar arrangements will be made for social care. We will discuss the details of both with the National Assembly for Wales.

The new commission will be independent of both the NHS and Government, and more independent than the current fragmented system. It will report annually to Parliament, not Ministers, on the state of the NHS, its performance and, most important, the use to which it has put the extra resources. The Government should not be judge and jury of the NHS. The commission will be the judge, the British people the jury.

Secondly, we can go further in extending devolution in the NHS, building on what has been achieved. The health service should not and cannot be run from Whitehall. The NHS is delivered in hundreds of different communities by more than 1 million staff. The relationships are between the local patient and the local doctor; the local community and the local hospital. However, those relationships will not work properly until central control is replaced by local accountability. After 50 years, the time has come when the sound of bedpans being dropped in Tredegar should reverberate only in Tredegar.

With national standards and inspection in place, power, resources and responsibilities must now move to the NHS front line. When we came to office, GPs controlled only 15 per cent. of the total NHS budget. Today, primary care trusts, with GPs and nurses in the lead, already control half the budget. In only two years, they will control three quarters of it. Just as the new commission will report nationally, so primary care trusts will need to report locally on how NHS resources have been spent.

The best primary care trusts, like the best NHS hospitals, should enjoy greater freedoms and more rewards. We will therefore establish new foundation hospitals and foundation primary care trusts, which will be fully part of the NHS, but with more freedoms than they have now. They will have more powers, including a right to borrow, to expand their services for patients.

Thirdly, further to the new powers that we have given nurses and others, we will radically alter the way in which staff work and introduce a new system of financial incentives throughout the health service. We will put in place new contracts of employment, not only for nurses and other staff, but for GPs and, yes, for hospital consultants, too. Our objective is to liberate the potential of all members of staff, rewarding those who do most in the NHS and, crucially, improve productivity throughout the health service.

New incentives for individual members of staff will be matched by a new system of financial incentives for NHS organisations. The hospitals that can treat more patients will earn more money. Traditional incentives work in the opposite direction. Indeed, the poorest performers often get the most financial help.

We will therefore introduce a new system for money to flow around the health service, ending perverse incentives and paying hospitals by results. The incentive will be to treat more patients more quickly, and to higher standards.

Fourthly, patient choice will drive the system. Starting with those with the most serious clinical conditions, patients will have a greater choice about when and where they are treated. From this summer, patients who have been waiting six months for a heart operation will be able to choose a hospital, public or private, which has the capacity to offer quicker treatment. This level of investment means that we can grow NHS capacity as fast as it is possible to do so.

I can also say today that it is our intention to draw into this country additional overseas capacity so that we can further expand NHS services to NHS patients. As capacity expands, so choice will grow. Within three years, all patients, with their GPs, will be able to book hospital appointments at a time and a place that is convenient to them. The reforms that we are making will mark an irreversible shift from the 1940s take-it-or-leave-it, top-down service. Hospitals will no longer choose patients; patients will choose hospitals.

Reductions in waiting times to get into hospital must, of course, be accompanied by cuts in waiting times to get out. Older people are the generation that built the health service, and they have supported it all their lives. This generation owes that generation a guarantee of dignity and security in old age. Bed blocking denies both.

In recent months, the extra resources that we have made available have reduced the numbers of elderly patients whose discharge from hospital has been delayed. I am grateful for the help that local councils have given us in addressing this problem. Here, however, the long-term solution is not just investment, it is reform. I can tell the House today that, to bridge the gap between health and social care, we intend to legislate, as they have done in Sweden and other European countries, to give local councils responsibility-from their 6 per cent. extra real-terms increases-for the cost of beds needlessly blocked in hospitals.

Councils will need to use those resources to ensure that older people are able to leave hospital when their treatment is completed. If councils reduce the current level of bed blocking so that older people are able to leave hospital safely when they are well, they will have the freedom to use those resources to invest in extra services. If bed blocking goes up, councils will incur the cost of keeping older people in hospital unnecessarily. There will be similar incentives to prevent hospitals from seeking to discharge patients prematurely. In this way, we will provide local councils with the investment and the incentives to improve care for older people.

Taken together, the NHS plan and the next steps announced today amount to the most radical and fundamental reform programme inside the NHS since 1948. I want to pay tribute to the staff of the national health service-not just the nurses, doctors and consultants, but all the staff in the different medical disciplines, the ancillary staff, the secretaries, the receptionists, the porters and the cleaners. They represent the very best of British public service and I believe that, as a nation and as a Parliament, we should be proud of the work that they do. I know and understand the enormous pressure that they are under as the NHS plans to make these big changes. But I know, too, that they share this basic goal: to rebuild the national health service around the needs of its patients.

This programme of investment and reform will mean that each year, every year, waiting times will fall. Last year, the maximum wait for a hospital operation was 18 months. Today it is 15 months. By this time next year, it will fall to 12 months. By 2005, it will be six months, and by 2008, it will have been reduced to three months. By then, the average waiting time for a hospital operation will be just six weeks. It is our aim that people will no longer have to face the dilemma of having to wait for treatment or having to pay for it.

As a party and as a Government, we are committed to providing opportunities to all in our society and not just to some, so there will be more effort to prevent ill health, as well as treating it. Twenty-five thousand lives a year can be saved by the investment we can now make in preventing and treating heart disease alone.

The balance of services will shift, with more patients being seen in primary and community settings, not just in hospitals. Social services will have resources to extend by one third rehabilitation care for older people. Councils will be able to increase fees to stabilise the care home market and secure more care home beds. More investment will mean more old people will have the choice of care in their own homes rather than in care homes.

Yesterday’s Budget and today’s reforms mean that the NHS plan will be delivered.

I want to make two further points. First, it is a 10-year plan, as we said in July 2000. By the time of the next election, there will be real and significant improvements. However, that cannot happen overnight. It takes seven years at least to train a doctor and up to 15 years to train a consultant. Expectations will be high-I understand that-but they also need to be reasonable, and people need to understand that a 10-year plan is exactly what it says. It will take time to be delivered in full. At least now, public and patients will be able to see improvements made stage by stage, independently of Government, audited, monitored and inspected.

Secondly, there is consensus in the country on one thing: Britain needs to spend more on health care. There is no mystery about why there are no waiting lists in Germany. It has spent more, and has done so for years.

We can debate endlessly the system of finance, but one thing is beyond debate: the level of finance has to be raised. Once that is accepted, the choice is not between a system funded out of general taxation, which results in higher national insurance, and some other system that comes for free. Importing the German system of social insurance would cost the equivalent of an extra £1,000 per worker per year, and the French system would cost £1,500 per worker per year.

Labour Members believe in the NHS in our heads as well as our hearts. We believe it to be the best and fairest system of providing true health insurance, because it is based on the scale of the person’s need, not the size of their wallet. It is the best insurance policy in the world.

It is now for those who want to see the NHS not reformed but abandoned, and who routinely call it Stalinist, to say honestly what their alternative is, what it would cost and how much families and pensioners would have pay for it.

Yesterday we made a choice, and we ask the British people to make the same choice. We are proud of the NHS and of the people working in it. We are giving it the money that it deserves. We are making the changes it needs. Investment plus reform equals results. We will be happy to be judged on them.

Alan Milburn – 2002 Speech to the NHS Leadership Centre Annual Conference

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 12 April 2002.

I wanted to come to your conference today because the people here are actually the people who are changing the National Health Service. You are the people who are turning rising levels of investment in the NHS into real reforms and I hope real improvements for patients.

We’ve seen some of that progress reported just this week – with shorter waiting times in hospitals, for ambulances and in GP surgeries too.

Of course there is an awfully long way to go but these are real achievements. They are the achievements that you and your colleagues around the country have made. And I simply want to congratulate you for them and to thank you for the job you are doing.

I know you work under huge pressure every day. And I know that there are lots of problems as well as signs of progress in the NHS today. But I believe the best days of the NHS are ahead of us, not behind us. It’s about time that we, as a country, started to feel a little more pride in the achievements of the million or more staff who work in the NHS and a little more confidence in the health service they provide.

It should be a cause of national pride that health care in our country is free. That no-one asks for your insurance policy or your cheque book before you get the care you need.

The reason the NHS continues to command such affection in the hearts of the British people is that its values are actually the values of our nation – fairness and equality, compassion and community, a belief that we can achieve more together than we ever can alone.

But the NHS should be supported with our heads as well as our hearts. Its values – far from being the backward looking sentimentalism that our critics claim – are actually grounded in the needs of our society today.

Without the NHS the sophistication of modern treatments – and of course their cost – would put individual provision of health care beyond the reach of all but the very wealthiest in society. For me at least the sick paying for the privilege of being sick is hardly the mark of a fair or civilised society. In a world where health care can do more and costs more than ever before having an NHS based on need and not ability to pay is a real source of strength for our country and security for our people.

The truth is most patients – despite the problems the NHS still faces today – get good quality care. Where there are sometimes lapses in the quality of care our job is to tackle them. What we cannot allow is for the bad to detract from the good, for the isolated case to become the perceived norm. To read some of our daily newspapers you would sometimes think that the NHS is full of bad doctors, or bad nurses. It isn’t. It is full of good people – therapists and scientists, cleaners and porters, managers and paramedics as well as doctors and nurses – who come to work to care for others. It is about time we as a country got behind the people working in the NHS rather than trying as some now seek to do to actively undermine them.

It is now clear that those who are opposed to the NHS – including some of our political opponents – are embarked on a quite deliberate and cynical strategy of first undermining the NHS as a prelude to their real agenda of tearing down the NHS and forcing people to pay for the costs of their own treatment.

I say today to those enamoured of a private insurance alternative to the NHS: look to the USA where 40 million people have no health cover at all; see what happens with private insurance rather than community provision; and then ask yourself do we really want health care based on how much you can afford to pay rather than how ill you are? Do we really want doctors in this country reaching for your wallet before they reach for your pulse?

I think not.

Private insurance policies, even with all the exemptions they contain, are consistently more expensive and more bureaucratic for consumers and taxpayers than publicly funded health systems. Giving tax breaks to encourage more private insurance would involve the taxpayer subsidising people who already had insurance policies – a significant diversion of public resources from the NHS for the benefit only of a few.

The examination that we have made, that Derek Wanless has made, that the British Medical Association has made of different systems of funding health care have all concluded one thing: that a tax-funded NHS is a fairer and more efficient way of providing health care for our country than the alternatives on offer. The NHS should be supported with our heads as well as our hearts.

Of course there are bad things about the British health care system – whether it is staff shortages or bed shortages or long waits for treatment. But when people say to me: what about levels of health provision in France or Germany or Sweden, I say: these countries do not have a superior system for funding their health care, they have superior levels of funding for health care.

No-one can escape the simple reality that there isn’t a health care system in the World that is cost-free. Somehow or other it has to be paid for. In Britain we pay from general taxation. In some countries employers and employees pay more. In other countries individuals pay for themselves. No country provides health care for nothing.

As a government, we recognise that the limitations of Britain’s tax-funded health service have not been the system of funding from general taxation but the level of funding from general taxation.

In just a few days time there will be a choice for our country. To go back to the days when the approach on the NHS was one of cutting taxes, cutting spending, cutting services and in the end therefore forcing more people to pay for their own care. Or to continue to move forward with sustained investment matched by fundamental reform.

I believe passionately that the right way forward for our country is to continue investing and to press ahead with reform.

Health care has to be paid for – one way or another – and World class health care costs a little more. In a world of rising health costs and greater health possibilities the NHS is the best insurance policy you can have. Putting the health service on a sustainable footing for the long term will pay dividends for us all in security for ourselves and our families.

What we have started in the last few years we should see through. The NHS today is the fastest growing health care system of any major country in Europe. But there’s a huge amount of catching up to do. And huge problems to overcome. The waiting times are coming down but are still too long. The staff numbers are growing but there are still too many shortages. The system and the people working in it are still working under huge pressure.

What we know is that that when we put extra resources into the NHS that delivers results for patients. Not overnight, nor with a big bang but steadily, step by step. Sustained improvement is by necessity more about evolution than revolution. The only way to keep progress coming through is to keep the investment going in. And to use the resources to reform how health care is delivered.

Nobody I have ever spoken to in the health service – not the public, the patients or the staff – just wants more of the same. People today expect a different sort of service, a different level of service as well. People want services that are responsive, and which offer faster, higher quality care. Increasingly, and rightly so in my view, they want to make informed choices about how to be treated, where to be treated and by whom.

Some say that that sort of service can only ever happen in a private market. I say with the right level of investment and the right programme of reform the NHS can do that better than any private provider.

The NHS Plan that we drew up with people working in the service and patients using it is our ten year programme of reform. National standards and a tough system of inspection. New contracts for nurses, doctors and staff throughout the NHS to get more flexibility and to match pay with responsibility. More choices for patients and more partnerships between the private, voluntary and public sectors. And above all else to get the best from the investment the NHS must be run by the people delivering the care. It cannot be run from Whitehall.

I don’t treat patients. You do. So just as schools now have greater control over resources for education so local health services should have greater control over health resources. That is what the new Primary Care Trusts are all about – with frontline staff in the lead. More than any other change the PCTs signal that half a century of centralised health care in our country is drawing to a close. The old style NHS where everything was run from the top down rather than the bottom up must now be a thing of the past.

It will take time to complete the transformation but the direction is set. Power and resources will now move into the hands of frontline services and frontline staff. Three quarters of the NHS Budget, within just two years, will be controlled not at the centre but at the frontline. And let me just make one thing clear today: 75% represents the starting point not the finishing line in our drive for decentralisation and devolution in the NHS.

With the right level of investment we should be seeking to unleash a new culture of public sector enterprise in the NHS capable of rivalling any spirit of private sector enterprise. It means providing better incentives to get health and social services working more effectively locally as a single care system rather than as two separate systems. It means more discretion over how local budgets are spent and where they are spent. More information and more choice for patients. Greater freedoms and more rewards for NHS organisations which are doing best alongside more help, support – and where necessary intervention – for those that are not.

Above all else it means giving frontline staff the help you need to do the job you want to do. More staff. Fairer pay. Better childcare. Greater flexibility. A bigger sense of involvement in making change happen.

The simple truth is the NHS works best when it harnesses the commitment and know-how of staff to improve care for patients.

That’s why we are putting ward sisters in charge of ward budgets and giving health visitors a greater say over community health budgets. It’s why matrons are being given the power to get the fundamentals of care – like clean wards and good food – right for patients. It’s why nurses are being given new powers to prescribe drugs and discharge patients.

All of this is about unleashing the tide of innovation that exists among staff in every health centre and every hospital. Nothing should provide us with a greater sense of optimism and confidence about the future of the NHS than the Modernisation Agency’s Report that is being published today. In example after example it shows that where staff have been given their heads they have improved services for patients.

In North Hampshire, for example, pre-booked appointments for lung cancer scans have reduced the wait for an outpatients appointment from an average of 20 days to 2 days. In North West London new staff rotas and changed working practices have reduced waits for echocardiography from an average of 130 days down to just 7 days. In Wisbech, at the North Brink Surgery patients used to wait 16 days for a routine appointment. A month after the reform programme was put in place ‘did-not-attends’ had halved. The duty doctor emergency work was down by 85%. Today, 82.5% of patients see whichever GP they want when they want. The surgery has abolished waiting times and the duty doctor is an average of 55% quieter than 18 months ago.

What these examples – and countless others in the Agency’s report- demonstrate is that investment only really works if it is matched by reform. And the essential ingredient that is needed are strong local clinical leaders in charge of making the process of reform happen.

What we need to do is to support more staff through the reform process. Reform isn’t easy. It takes time and effort when on the frontline staff find that each day both are squeezed hard. That is why we will be looking at how we can give staff more protected time to improve services. How we can help more staff develop their skills and their personal potential. How we can use the introduction next year of the new NHS University and an expanded Modernisation Agency programme to develop more local clinical leaders.

What is on offer here is a partnership between the Government and the people working in the NHS. We are prepared to commit more investment for the health service but only if it is matched by a commitment to reform. The reforms are as vital as the resources. More money going into health budgets is conditional on getting more out for patients. In every community, every hospital, every surgery reform now needs to bite. The health service – all across the health service – will need to show that extra resources are producing reforms and results for patients.

Your leadership is vital. Without it reform will not happen. Frontline staff need to be in the driving seat to make the changes and improvements patients want to see.

In the end this is actually not about systems. It is about values. The NHS is the right system because it has the right values. I believe in it – and the people working in it – not out of some sort of old-fashioned sentimentalism but because in the modern world the NHS is more right and more relevant than it has ever been before. Without the health service millions could never afford healthcare. With the health service all of our people can. It is the best one nation policy our country has ever seen.

As a government we have made our choice. Our choice is for the NHS. For a reformed health service. For an NHS that enjoys higher levels of spending. Above all else our choice is for the patients who need the NHS. It is I believe the right choice for Britain.