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  • Patricia Hewitt – 1998 Speech on the Global Economy

    Patricia Hewitt – 1998 Speech on the Global Economy

    The speech made by Patricia Hewitt, the then Economic Secretary to the Treasury, at the Fleming’s Seminar in 12 October 1998.

    Introduction

    1. Thank you for inviting me. The current turmoil in the global economy makes the timing of this conference pertinent.

    2. Today, I want to focus on the reform that is needed to respond to globalisation. Both in Europe and the rest of the world. I also want to raise the issue of free trade and capital controls.

    Global change and Europe’s response

    3. Today’s global economic problems are ones of the modern age. They could not have happened when finance was confined within sheltered and wholly national financial systems. These are new global problems which require new global solutions.

    4. Today, in an interdependent and instantaneous global marketplace, nations depend on investment flows from all over the world. And the punishment for getting things wrong can be immediate and severe. The premium everywhere is on monetary and fiscal stability

    5. All countries will benefit from setting clear long-term policy objectives for monetary and fiscal stability that build confidence.

    6. But equally, in today’s deregulated, liberalised financial markets, governments can no longer try to deliver stability through the strict application of over-rigid monetary targets. Stability will come through setting out clear objectives for monetary policy, and having the openness and transparency necessary to give credibility to the process.

    7. There have been considerable advances in stability and prudence over recent years.

    8. Member states have taken the Maastricht process very seriously and this has not been easy.

    9. In the 1990s deficits, which were a high proportion of GDP right across Europe, have fallen very heavily, from a peak of around 6 per cent of GDP to around 2 1/2 per cent.

    10. Inflation, which has been very high in some countries over many decades is now very low, around 2 per cent compared to a 1990 peak of over 5 1/2 per cent.

    11. Of course there is room for more progress on debt, which remains around 72% of GDP. But overall these are big changes signalling big advances in stability and prudence – and these advances have also brought greater convergence.

    Structural reform

    12. Macroeconomic policy will not in itself guarantee the levels of employment and growth that we want to see for Europe and the rest of the world. It is on the supply side that the rate of sustainable non-inflationary growth that an economy can achieve is determined. Structural reforms are essential for any country to remain competitive in this global age.

    13. Reforms of labour, product and capital markets that are now being suggested represent a third way for Europe. A third way which combines our enduring commitment to social cohesion and social justice with a commitment that, through economic reform, we help to ensure that Europe enjoys the rewards of an efficient dynamic economy.

    14. Globalization brings big opportunities and significant economic and social benefits, but it brings risks and social costs too. The benefits are not evenly distributed. People must now respond more quickly to the uncertainty and unpredictability. Jobs may not last as long and skills may quickly become obsolete as technological change accelerates. This can be difficult for people to accept and those who are unable to adapt quickly can get stuck in a vicious circle of social exclusion. But we can be sure that the social costs of doing nothing of isolationism or of protectionism are far higher. Open international markets benefit us all.

    15. In Europe, the challenges may not appear so severe. The EU has some of the most efficient, competitive, and well-regulated markets in the world. But we must be frank. With the advent of the single currency from 1.1.99, prices will become more transparent, exchange rate uncertainty will be reduced, and competitive pressures will sharpen. Less efficient industries will no longer be able to hide behind the fig-leaf of exchange rate uncertainty. If we want to make EMU a success, and if we want our economies to be able to deal satisfactorily with shocks, Europe’s governments must turn to the supply side, undertaking fundamental reform of labour markets, product markets and capital markets.

    16. It is vital that as Governments we take the actions that are needed to help tackle unemployment and raise employment. We need to combine making the structural reforms that are needed in our labour markets with measures to improve the employability of our workforces. We need, for example, to review our tax and benefit systems and make sure that they give the necessary incentives to make work pay and we need to ensure that our education systems are producing school leavers with the written, oral, numeracy and other basic skills that employers need and should expect.

    17. We have already made good progress. At both the EU level and individually within member states we are all doing this. With the Employment Chapter, Employment Guidelines and Employment Action Plans we have a new framework for policy and action at the European level. We have agreed employment guidelines with specific targets for action and each member state has produced Employment Action Plans showing what they are doing to implement. It is only by making the necessary reforms that we will tackle unemployment and raise living standards across the EU. But we have made good progress.

    18. But it is not only in the labour market that structural reform can yield significant results. In product markets, we must strive for a competition policy that creates more dynamic markets, is effective against those cartels and monopolies that hold new businesses and job creation back, and – in large areas where European-wide competition is still inadequate – pushes forward the frontiers of the single market. We must also work to increase competition internationally. So the era of anti-competitive policies is ending. The era of new pro-competitive policies and prosperity is beginning.

    19. In the financial markets, EU states have increasingly opened up to firms from other member states, widening the choice for consumers to let them widen portfolios and diversify risk. Many are working on far-reaching pension reforms which will significantly expand their capital markets. Regulatory and investor protection systems are being improved. But we know that there is much more to be done.

    20. More efficient equity markets have the potential to expand significantly, to the benefit of investment and jobs. The era of ignoring capital market reform is over. The era of pro-investment capital market reform has begun.

    21. There is also significant potential growth for venture capital markets. Britain’s venture capital market has been a significant creator of high quality jobs and companies. But it is much smaller than that of the USA. There is a new interest throughout Europe in examining how to enlist capital as a more effective route to job creation.

    Progress

    22. The EU has made significant progress in advancing the economic reform agenda. This year at Cardiff, Heads of Government agreed that Member States should each produce short annual reports on their product and capital markets, for discussion with their peers. And the Commission will produce a report too, for those common policies which impact on product and capital markets, such as competition and the Single Market.

    23. It will clearly take time to get results – there are no quick fixes with economic reform. But we should be encouraged. Economic reform has been recognised as the next big challenge for Europe in the globalised economy, and together Member States have set out an ambitious programme.

    Free trade

    24. Globalisation requires us to look beyond Europe. We remain committed to working with others to keep markets for trade and investment open while pushing for further and deeper liberalisation for the benefit of all.

    25. The gains from free trade are clear: better quality and more choice at lower prices. Efficient and innovative firms building a dynamic economy with rising growth productivity and living standards.

    26. But some fear free trade and globalisation leading to calls for protectionism. These pressures are increasing in the face of widening trade deficits with Asia. However, these fears are misplaced and must be resisted. The global economic crisis is causing painful adjustment – which is a necessary part of the cure for the crisis. We must not yield to the temptation to fall back on a protectionist response against cheaper imports. This is not an example of ‘unfair’ competition. Trade must be allowed to drive the restoration of global growth levels and re-integrate the countries in crisis back into the global economy. We have already pledged to guard against protectionism – but the surest way to fight protectionism is through further global trade liberalisation.

    27. The free trade message must be kept on the agenda – especially given the slowing of the growth of trade. This is why we are giving our full support to an early start to a millennium round of comprehensive liberalising trade negotiations at the WTO.

    28. The recent turbulence in world financial markets has led to some calls for capital controls. It is certainly clear that short-term capital flows can be destabilising and can disrupt markets when investors are insufficiently informed and when institutions lack credibility.

    29. But a retreat to capital controls is not the solution. This simply damages the prospects for stability and growth.

    30. So we favour an approach to capital account liberalisation which is bold in concept, but cautious in implementation. It has become clear that a host of preparatory reforms are needed before countries can fully benefit from integration into the world economy. Orderly liberalisation requires sound banking and financial systems and appropriate macroeconomic policies – consistent with the codes of good conduct we have proposed fiscal policy and monetary and financial policy.

    31. I hope that all in Europe can firmly back this consensus – both in encouraging properly sequenced liberalisation and in opposing unilateral actions taken as a substitute for necessary reform.

    Conclusion

    32. This programme of economic stability and structural reform will maximise our contribution to global stability and growth.

    33. We will have a Europe that builds on our long standing strengths of stability and cohesion as a continent but which makes reforms where necessary to compete more effectively globally.

    34. And it will mean we are better placed to steer a course of stability in an uncertain and unstable world.

  • Patricia Hewitt – 1998 Speech at the Downing Street Seminar on Profitable Community Banking

    Patricia Hewitt – 1998 Speech at the Downing Street Seminar on Profitable Community Banking

    The speech made by Patricia Hewitt, the then Economic Secretary to the Treasury, at Downing Street, London, on 3 November 1998.

    Introduction

    1. Good morning and welcome to Downing Street.

    2. We invited you here today to explore community development banking, to hear about the US experience, and to consider what we can learn from it. Community banking can offer a win-win solution – it improves services for people in the poorest communities, and can prove profitable for the banks.

    3. How can we ensure people have basic cash access facilities? What is the best way of helping people begin to save and get credit? How can we expand Credit Unions? How do we bring small scale capital into deprived areas? Do we do this through banks? Through credit unions? What about micro-credit organisations? These are some of the many questions I hope we will explore today.

    We are extremely fortunate to have with us:

    Ron Grzywinski of Shorebank;

    Greg Hattem of Bankers Trust;

    Cliff Rosenthal of the National Association of Community Development Credit Unions; and

    Susan Rice, currently with Bank of Scotland, but formerly with NatWest’s US subsidiary, Bancorp.

    4. I want to start by why there is a problem with social exclusion. Then I want to move on to talk about the steps the Government is already taking to tackle social and financial exclusion. I will conclude by looking at how to take the agenda forward.

    General policy considerations

    5. My concern is financial exclusion, which is both a symptom and a cause of social exclusion. Combatting social exclusion is at the very heart of this Government’s agenda.

    6. We have watched the gap between rich and poor in this country widen over the last twenty years.

    7. Most people in Britain have benefited from rising living standards; and this is reflected in the growth and prosperity of the financial services industry.

    8. Of course this is good news, and we will be doing all we can to ensure it continues.

    9. But for the poorest people, concentrated in the most deprived neighbourhoods, it is a different story.

    10. They have not shared in the increased wealth and greater opportunities so many of us enjoy.

    11. And, crucially, they do not – or cannot – access financial services products.

    12. In my own constituency in west Leicester, there are outer city estates with too few jobs and too much crime, where most children leave school without qualifications – and where financial services all too often mean benefit cheques and illegal loan sharks.

    13. It is in the poorest communities that we find the highest concentrations of people without bank accounts, without access to other financial services.

    14. People in these communities can very often by locked into the cash economy, cannot get affordable property or possessions insurance, can only access credit at unbelievably high interest rates, and do not use mainstream savings opportunities. Also, the chances of accessing appropriate finance and support for self-employment or starting their own businesses may be effectively zero.

    15. This Government is not prepared to accept a society where economic opportunity is restricted in this fashion.

    Government response

    16. For many of those living in our most deprived neighbourhoods, the policies of the past bear much of the blame.

    17. But the past is the past. We must now get on and deal with the problems head-on.

    18. We have to bridge the gap between the poorest neighbourhoods and the rest of the country – and this is a priority issue.

    Tackling financial exclusion

    19. The Government cannot overcome problems of social exclusion on its own, and nowhere is this more evident than in the area of financial exclusion.

    20. Our policy is to promote wider access to financial services, where progress has been made, but is in danger of becoming stalled.

    21. We set out overall agenda for deprived neighbourhoods, in the Social Exclusion Unit report, Bring Britain together, which was published in September.

    22. This set out our proposals, to be taken forward by 18 policy action teams, over the next year.

    23. Two of these action teams concern financial services. They are to be run by the Treasury and will report to me by July next year.

    24. One of them will look into prospects for increased access to personal financial services for people living in poor neighbourhoods, especially retail banking, but also credit unions and insurance.

    25. The other will concentrate on encouraging enterprise in deprived neighbourhoods.

    26. This means better access to capital for small firms especially those starting up in poor neighbourhoods; and better access to appropriate advice.

    27. Let me now turn to the main areas of interest to the banking industry.

    Access to bank accounts

    28. First, access to bank accounts, and those who don’t have bank accounts.

    29. Whilst access to banking is the norm, at least for those in regular full-time employment, there is a conspicuous unbanked minority, predominantly poor and not in regular full-time work, for whom life without a bank account is becoming increasingly inconvenient.

    30. We are talking here about somewhere between 2 1/2 and 3 1/2 million people, concentrated in the most deprived neighbourhoods.

    31. We used to think that the main reason people did not have bank accounts was that banks turned them down.

    32. But recent research, sponsored by the British Bankers’ Association, dealing specifically with people without current accounts, reveals a far more complex pattern.

    33. Only a very small number of people had been refused accounts, or did not ask for one because they feared refusal.

    34. Far commoner were people who thought traditional bank facilities were not for them, the so-called self- excluded.

    35. But to depict the main problem as self-exclusion is to avoid the issue, which is how banks can redesign their products, to better suit the circumstances and preferences of those currently without access to them.

    36. I would like to think that such difficulties can be overcome. Some banks are offering new accounts where an on-line debit card replaces the cheque book and access to credit is withheld until the customer and the bank feel comfortable with it.

    37. I know a number of you are already thinking on these lines.

    Contribution of credit unions

    38. Credit Unions too have an important role in tackling financial exclusion. They provide savings facilities, a source of low cost personal credit and financial education and advice.

    39. Our approach to credit unions is to encourage the movement to grow, while retaining and strengthening its traditional focus on the poorer members of society. This will be partly through legislative change, lifting some of the restrictions on Credit Union operations.

    40. We have also been thinking about how the movement should be regulated in future; and the scope for setting up a share protection scheme. Proposals in these areas will be published soon.

    41. But even within the existing legislative framework, we believe there is considerable scope for expansion. We have established a taskforce to explore ways in which banks can work more closely with credit unions to increase their effectiveness, and are studying existing good practice here and in other countries.

    42. I am delighted to see most of its members here today, and we look forward to Cliff Rosenthal’s presentation, later in the morning, on how the banks have helped the credit unions in the United States.

    Small firm finance

    43. Just because a neighbourhood may be poor in its physical and economic standing does not mean that it cannot be rich in people with ideas and initiative to start up and run their own businesses.

    44. But to realise their ambitions for business, these budding entrepreneurs will often need more capital, advice and mentoring than is presently available. Access to capital is a key component of strategies to regenerate poor neighbourhoods and encourage greater self-reliance.

    45. At present there is too often a mismatch between potential enterprise and the support needed to realise it, with the deficit greatest in the poorer areas where it is most needed.

    46. The key to generating sustainable and productive enterprise in deprived neighbourhoods is to create the right incentives for the private sector to work with public agencies. This could help lever in fresh capital where it is needed most. Without access to capital there will be no new enterprises to support.

    47. We need to help pull together the expertise and disciplines which commercial finance and business advice can bring, along with the local understanding of neighbourhoods which local agencies provide.

    48. The work of the Treasury action team involves examining the current roles of large corporations, banks and professional service firms in community regeneration, and how this complements the voluntary sector and community support networks.

    49. The role that innovative community investment projects can play in building and sustaining local economies has already been vividly highlighted in some the world’s poorest regions. The Grameen Bank in Bangladesh, for example, offers Microfinance – savings and loans at a human level, providing first stage finance to enable individuals to make a go of their enterprise. This has proved itself viable.

    50. We will look at the availability of debt and equity finance, and we will see how that capital can be put to best use by making sure enterprises have the right technical advice and mentoring when they need it most.

    51. We will also examine critically the role of the various Government support schemes, such as the loan guarantee scheme, Business Links and Training and Enterprise Councils.

    52. So we – and I hope you – are interested in innovative approaches to small firm finance, to help overcome the disadvantages experienced by those seeking to start up on their own in poor areas.

    Conclusion

    53. Like the Clinton Administration in the US, this Government believes strongly that wider access to financial services – through positive action by the banking community – is vital.

    54. And we also believe that the driving force will be banks searching for new, profitable market opportunities.

    55. This has been the experience in the United States, as our guest speakers today will testify.

    56. In the US, the banks are obliged to report on their provision of credit to all sections of the community; but they are not required to do anything that is inconsistent with sound banking principles.

    57. The result, so we are told, has been a huge injection of finance into low and moderate income neighbourhoods. And US banks have found profitable market opportunities in areas they might otherwise have ignored.

    58. I think there is much to be learned from considering the implications of that message for what we do in this country. I should emphasise that we are not planning to copy the US legislation. But we are interested in increasing the response of UK banks to the opportunities that exist for profitable banking in our poorer communities.

    59. That is the objective of this seminar, which I hope you will find enjoyable and thought-provoking. So it is a pleasure to hand over to Ron Grzywinski, the Chairman and Chief Executive Officer of Shorebank, considered by many to be the pioneers of community banking in the United States.

  • Patricia Hewitt – 1998 Speech on the Global Economy

    Patricia Hewitt – 1998 Speech on the Global Economy

    The text of the speech made by Patricia Hewitt, the then Economic Secretary to the Treasury, on 12 October 1998.

    Introduction

    1. Thank you for inviting me. The current turmoil in the global economy makes the timing of this conference pertinent.

    2. Today, I want to focus on the reform that is needed to respond to globalisation. Both in Europe and the rest of the world. I also want to raise the issue of free trade and capital controls.

    Global change and Europe’s response

    3. Today’s global economic problems are ones of the modern age. They could not have happened when finance was confined within sheltered and wholly national financial systems. These are new global problems which require new global solutions.

    4. Today, in an interdependent and instantaneous global marketplace, nations depend on investment flows from all over the world. And the punishment for getting things wrong can be immediate and severe. The premium everywhere is on monetary and fiscal stability.

    5. All countries will benefit from setting clear long-term policy objectives for monetary and fiscal stability that build confidence.

    6. But equally, in today’s deregulated, liberalised financial markets, governments can no longer try to deliver stability
    through the strict application of over-rigid monetary targets. Stability will come through setting out clear objectives for monetary policy, and having the openness and transparency necessary to give credibility to the process.

    7. There have been considerable advances in stability and prudence over recent years.

    8. Member states have taken the Maastricht process very seriously and this has not been easy.

    9. In the 1990s deficits, which were a high proportion of GDP right across Europe, have fallen very heavily, from a peak of around 6 per cent of GDP to around 2 1/2 per cent.

    10. Inflation, which has been very high in some countries over many decades is now very low, around 2 per cent compared to a 1990 peak of over 5 1/2 per cent.

    11. Of course there is room for more progress on debt, which remains around 72% of GDP. But overall these are big changes signalling big advances in stability and prudence – and these advances have also brought greater convergence.

    Structural reform

    12. Macroeconomic policy will not in itself guarantee the levels of employment and growth that we want to see for Europe and the rest of the world. It is on the supply side that the rate of sustainable non-inflationary growth that an economy can achieve is determined. Structural reforms are essential for any country to remain competitive in this global age.

    13. Reforms of labour, product and capital markets that are now being suggested represent a third way for Europe. A third way which combines our enduring commitment to social cohesion and social justice with a commitment that, through economic reform, we help to ensure that Europe enjoys the rewards of an efficient dynamic economy.

    14. Globalization brings big opportunities and significant economic and social benefits, but it brings risks and social costs too. The benefits are not evenly distributed. People must now respond more quickly to the uncertainty and unpredictability. Jobs may not last as long and skills may quickly become obsolete as technological change accelerates. This can be difficult for people to accept and those who are unable to adapt quickly can get stuck in a vicious circle of social exclusion. But we can be sure that the social costs of doing nothing of isolationism or of protectionism are far higher. Open international markets benefit us all.

    15. In Europe, the challenges may not appear so severe. The EU has some of the most efficient, competitive, and well- regulated markets in the world. But we must be frank. With the advent of the single currency from 1.1.99, prices will become more transparent, exchange rate uncertainty will be reduced, and competitive pressures will sharpen.  Less efficient industries will no longer be able to hide behind the fig-leaf of exchange rate uncertainty. If we want to make EMU a success, and if we want our economies to be able to deal satisfactorily with shocks, Europe’s governments must turn to the supply side, undertaking fundamental reform of labour markets, product markets and capital markets.

    16. It is vital that as Governments we take the actions that are needed to help tackle unemployment and raise employment. We need to combine making the structural reforms that are needed in our labour markets with measures to improve the employability of our workforces. We need, for example, to review our tax and benefit systems and make sure that they give the necessary incentives to make work pay and we need to ensure that our education systems are producing school leavers with the written, oral, numeracy and other basic skills that employers need and should expect.

    17. We have already made good progress. At both the EU level and individually within member states we are all doing this. With the Employment Chapter, Employment Guidelines and Employment Action Plans we have a new framework for policy and action at the European level. We have agreed employment guidelines with specific targets for action and each member state has produced Employment Action Plans showing what they are doing to implement. It is only by making the necessary reforms that we will tackle unemployment and raise living standards across the EU. But we have made good progress.

    18. But it is not only in the labour market that structural reform can yield significant results. In product markets, we must strive for a competition policy that creates more dynamic markets, is effective against those cartels and monopolies that hold new businesses and job creation back, and – in large areas where European-wide competition is still inadequate – pushes forward the frontiers of the single market. We must also work to increase competition internationally. So the era of anti-competitive policies is ending. The era of new pro-competitive policies and prosperity is beginning.

    19. In the financial markets, EU states have increasingly opened up to firms from other member states, widening the choice for consumers to let them widen portfolios and diversify risk. Many are working on far-reaching pension reforms which will significantly expand their capital markets. Regulatory and investor protection systems are being improved. But we know that there is much more to be done.

    20. More efficient equity markets have the potential to expand significantly, to the benefit of investment and jobs. The era of ignoring capital market reform is over. The era of pro-investment capital market reform has begun.

    21. There is also significant potential growth for venture capital markets. Britain’s venture capital market has been a significant creator of high quality jobs and companies. But it is much smaller than that of the USA. There is a new interest throughout Europe in examining how to enlist capital as a more effective route to job creation.

    Progress

    22. The EU has made significant progress in advancing the economic reform agenda. This year at Cardiff, Heads of Government agreed that Member States should each produce short annual reports on their product and capital markets, for discussion with their peers. And the Commission will produce a report too, for those common policies which impact on product and capital markets, such as competition and the Single Market.

    23. It will clearly take time to get results – there are no quick fixes with economic reform. But we should be encouraged. Economic reform has been recognised as the next big challenge for Europe in the globalised economy, and together Member States have set out an ambitious programme.

    Free trade

    24. Globalisation requires us to look beyond Europe. We remain committed to working with others to keep markets for trade and investment open while pushing for further and deeper liberalisation for the benefit of all.

    25. The gains from free trade are clear : better quality and more choice at lower prices. Efficient and innovative firms building a dynamic economy with rising growth productivity and living standards.

    26. But some fear free trade and globalisation leading to calls for protectionism. These pressures are increasing in the
    face of widening trade deficits with Asia. However, these fears are misplaced and must be resisted. The global economic crisis is causing painful adjustment – which is a necessary part of the cure for the crisis. We must not yield to the temptation to fall back on a protectionist response against cheaper imports. This is not an example of ‘unfair’ competition. Trade must be allowed to drive the restoration of global growth levels and re-integrate the countries in crisis back into the global economy. We have already pledged to guard against protectionism – but the surest way to fight protectionism is through further global trade liberalisation.

    27. The free trade message must be kept on the agenda – especially given the slowing of the growth of trade. This is why we are giving our full support to an early start to a millennium round of comprehensive liberalising trade negotiations at the WTO.

    28. The recent turbulence in world financial markets has led to some calls for capital controls. It is certainly clear that
    short-term capital flows can be destabilising and can disrupt markets when investors are insufficiently informed and when institutions lack credibility.

    29. But a retreat to capital controls is not the solution. This simply damages the prospects for stability and growth.

    30. So we favour an approach to capital account liberalisation which is bold in concept, but cautious in implementation. It has become clear that a host of preparatory reforms are needed before countries can fully benefit from integration into the world economy. Orderly liberalisation requires sound banking and financial systems and appropriate macroeconomic policies – consistent with the codes of good conduct we have proposed fiscal policy and monetary and financial policy.

    31. I hope that all in Europe can firmly back this consensus – both in encouraging properly sequenced liberalisation and in opposing unilateral actions taken as a substitute for necessary reform.

    Conclusion

    32. This programme of economic stability and structural reform will maximise our contribution to global stability and growth.

    33. We will have a Europe that builds on our long standing strengths of stability and cohesion as a continent but which makes reforms where necessary to compete more effectively globally.

    34. And it will mean we are better placed to steer a course of stability in an uncertain and unstable world.

  • Patricia Hewitt – 2005 Speech on the UK Role in Europe

    Patricia Hewitt – 2005 Speech on the UK Role in Europe

    The text of the speech made by Patricia Hewitt, the then Secretary of State for Health, on 28 November 2005.

    Thank you Fergal for that warm introduction.

    Good morning everybody. I’d like to welcome you all to the Patient Safety Summit, which we are holding as part of our 2005 Presidency of the European Union. I’m delighted to see so many people are here today. I welcome you all to London.

    This week 15 years ago, construction workers finally drilled through the last wall of rock to join the two halves of the Channel Tunnel – linking Britain to mainland Europe for the first time since the Ice Age, 8,000 years earlier.

    Today, the Tunnel has now come to be a “normal” part of our life for many of us, providing a seamless transport link between European cities. But it also reminds us that Europe is an increasingly connected community of countries – and that European cooperation can bring visible benefits to all of our lives.

    Many of you will have used the Channel Tunnel to be here today. We have delegates from across the EU member states, from the European Commission, from other parts of Europe, and from the wider world (including international organisations the World Health Organization and OECD, and delegates from the USA, from Russia, Canada and Australia).

    Most of you will be involved in making policy in some way. That is absolutely deliberate. This Summit is about solutions and action.

    I’m also delighted to welcome a number of patients from around Europe and the world. Your participation is vital because as you’ve heard all of us need to keep in mind the individual and the family who are at the centre of our quest to improve the safety of patient care. They are the ones who suffer from any harm caused when things go wrong.

    Once again, welcome to you all.

    Patient Safety Internationally

    Patient Safety is an international issue. No country – big or small – can claim to have solved the problem. That is why we have chosen it as a headline health theme to address in our 2005 Presidency of the European Union.

    A stark figure which you will hear over and over throughout this Summit is that in approximately 1 in 10 of hospitalizations, something goes wrong. In the increasing number of developed countries where research has been carried out, over and over we find similar levels of health care errors.

    Some of these errors are fortunately mild – for example a medication error which can simple mean a patient taking their medicine at the wrong time rather than the wrong medication – tragically others are not.

    For Europe, this means that some form of unintended harm is almost certainly suffered by millions of patients every year.

    We seem to have somehow forgotten the first law of medicine formulated by Hippocrates, almost over 2 and a half thousand years ago: ”first, do no harm.”

    Of course the situation in developing countries is significantly worse. There you have dedicated staff working with desperately poor infrastructure and equipment, unreliable supply and quality of drugs, shortcomings in waste management and infection control all make the probability of adverse events much higher.

    So wherever we are facing the challenge of patient safety isn’t easy. For patients, for those delivering health care, for policy makers, and for politicians, facing up to the fact that healthcare is an intrinsically risky – that in our complex healthcare systems, things do sometimes go wrong, and patients are sometimes harmed as a result – is not a comfortable or easy thing to do.

    In seeking to be more open about patient safety, I think we find that cultures can be stubborn, old behaviours can be persistent and attitudes difficult to change.

    The research and experience of other industries shows that an approach of blame and retribution – looking for a scapegoat – leads to a climate where individuals will be afraid to admit mistakes and no learning will ever take place.

    I, for one, and I hope all of us would much prefer to be treated by a health care system that knows when it makes mistakes – and acts to reduce the risk of them being repeated – than one that did not.

    The European response

    Among the impressive programme of Summit sessions, speakers, experts – and patients – we have Fernand Sauer, the European Commission’s Director of Public Health and Risk Assessment, who will speak to us a little later on. I’m very much looking forward to that.

    I am delighted that patient safety programmes are now emerging in many countries across Europe.

    Patient safety has been a headline health priority theme of both the 2005 Luxembourg and UK Presidencies of the European Union. Activity at the European level builds on a programme established by the World Health Organization through the World Alliance for Patient Safety and the work of other key partners such as the Council of Europe.

    We have representatives of the 2005 Luxembourg Presidency here: Health Minister Mars di Bartolomeo will speak tomorrow.

    Our own Presidency aims to build on the excellent work of the Luxembourg Presidency to ensure that our deliberations on patient safety at the EU level are translated into clear goals, practical programmes of activity and strong partnerships. Our vision is simple – to leave a lasting legacy of safer health care for all Europeans.

    I am pleased that the United Kingdom was one of the first countries in the world to give priority to tackling patient safety. We have tried in the past year to established safety as the first domain of the standards used to assess the quality of our healthcare service. We also have a national system for reporting – with learning from patient safety problems being translated into practical solutions for safer care.

    Just four weeks ago, the National Audit Office (which scrutinises public spending on behalf of our Parliament) published its review of this country’s NHS Patient Safety programme. The report concluded that we have made progress; organisations and staff across the NHS feel that they are moving towards a more open and fair culture of safety – driven largely though our national focus on quality and safety. Although we know we have much more to do.

    UK pledge of support

    And of course our work in Europe is part of a much bigger international movement.

    In May 2002 the World Health Assembly unanimously adopted a resolution urging all member states to take action on patient safety.

    The Resolution requested WHO to take a lead in building global norms and standards and supporting country efforts in developing patient safety policies and practices. Since then, we have seen the establishment of the World Alliance for Patient Safety.

    This was launched by the Director General of WHO, Dr LEE Jong-Wook in October 2004. I am delighted to say that Dr LEE is with us here today and will be addressing us shortly.

    The UK has had a very close association with the patient safety programmes at the EU level and at the WHO through the chairmanship of Sir Liam Donaldson of the World Alliance. That partnership has been of great value both within the UK and internationally. It has allowed us to bring the best of learning and experience from the UK to the international stage as well as ensuring that we can learn from international experience.

  • Patricia Hewitt – 1997 Maiden Speech to the House of Commons

    patriciahewitt

    Below is the text of the maiden speech made by Patricia Hewitt in the House of Commons on 3 July 1997.

    Thank you, Mr. Deputy Speaker, for giving me this opportunity to make my maiden speech during the debate on the Budget. It has been a pleasure to listen to such fine maiden speeches this afternoon. I listened with interest to the speech of the hon. Member for Tunbridge Wells (Mr. Norman). Having spent many a pleasant weekend with friends in his constituency, I was sorry to hear that “Disgusted of Tunbridge Wells” remains disgusted. I hope that he will make good his offer to assist my right hon. Friend the Chancellor of the Exchequer by ensuring that Asda, the company with which he has had such a long association, participates enthusiastically in our welfare-to-work programme.

    This is, above all, a Budget for jobs and families, which is why it is being so warmly welcomed in the constituency that I have the honour to represent. I know that my pleasure in this Budget will be shared by my predecessor, Greville Janner, whom many right hon. and hon. Members will remember as an effective Chairman of the Select Committee on Employment.

    Greville Janner is remembered and known more widely for his lifelong opposition to racism in all its forms, for his distinguished presidency of the Board of Deputies of British Jews, for his sponsorship of the War Crimes Act 1991, and for his relentless pursuit of the secret repositories of Nazi stolen gold. In the constituency, however, he is remembered above all as an outstanding constituency Member of Parliament.

    I remember last year knocking on the door of one elderly woman, who told me most movingly how her grandson had died many years ago in a tragic accident swallowing the top of a biro pen, which, in those days, lacked the tiny hole that would have enabled him to breathe sufficiently to remain alive. It was Greville who led the successful campaign for that safety measure in product standards. It was that sort of campaigning on behalf of his constituents for which not only he but his father—his predecessor in this House—is remembered.

    Greville was one half of a unique father and son team, who between them represented my constituency for 52 years. Greville’s father, who subsequently became Lord Janner, did not announce his decision to retire until after the 1970 general election had been called. Greville used to tell the story of his selection with great amusement. He claimed—I am sure quite wrongly—that he was assisted by the fact that the election posters, “Vote Labour, Vote Janner”, had already been printed. I am sure that he would have been selected under any circumstances. He will no doubt forgive me if I say how grateful I am that his son decided not to follow in his footsteps.

    I also want to pay tribute to three other outstanding public servants who served my constituency. Councillor Paul Sood was one of the most outstanding fighters for the Asian community, not only in Leicester, but throughout the country. Tragically, he died last year, just a week after being re-elected to serve as the city councillor for Abbey ward in my constituency. It was an enormous loss, but I know how proud he would be to see his widow, Mrs. Manjula Sood, now serving in his place.

    All of us in the constituency were sad to hear last month of the death of Councillor Martin Ryan, who for many years was leader of the Labour group on the county council. He served, among other capacities, as the county councillor for the Mowmacre ward in my constituency. Just two days ago, I was also extremely sorry to hear of the death of the former councillor, George Billington, who had only recently retired as my predecessor’s parliamentary agent. I will do my best to live up to the extremely high standards of public service which they and my predecessors have set.

    I know that my hon. Friends the Members for Leicester, South (Mr. Marshall) and for Leicester, East (Mr. Vaz) will agree when I say that Leicester is a wonderful place in which to live and to learn. We are Europe’s first Environment City. We are home to two first-rate universities. Many of their students, especially those at De Montfort, live within my constituency.

    Although it may distress some right hon. and hon. Members to acknowledge this, now that Leicester holds the triple crown of sporting achievements in football, rugby and cricket, we are indeed Britain’s sporting capital. I am delighted to say that, now that the Millennium Commission has chosen the project for the national space science centre, to be sited within my constituency, as the landmark millennium project for the east midlands, we will shortly be the space capital as well.

    Leicester, West is a constituency of captivating variety. It stretches from the old industrial buildings along the banks of the River Soar and the Grand Union canal, which form part of the border of the constituency. It takes in a small part of the city’s old mediaeval centre—although, less happily, we also take in some of the inner-city ring road, built in the 1960s with a distressing lack of sensitivity for that old mediaeval heritage. It extends down the Belgrave road, which marks the border between my constituency and that of my hon. Friend the Member for Leicester, East, where the red brick cottages of 19th century weavers are now the heart of Leicester’s Asian community, and from there across to the new estate of Beaumont Leys and the longer-settled communities of Mowmacre, Stocking Farm, New Parks and North Braunstone.

    I know that residents, especially on those estates, will warmly welcome my right hon. Friend the Chancellor’s announcement yesterday that he would rapidly begin the release of council house receipts, which will make possible desperately needed repairs and renovations to their homes.

    Above all, Leicester is rich in its people. We are well known, and rightly so, for our cultural and racial diversity. By the year 2000, half the young people of our city will come from the ethnic minority communities. Leicester is fortunate to be home to many thriving businesses and to a variety of churches, temples, gurdwaras and mosques that are at the heart of the communities they serve. It is home also to a number of theatres, festivals and arts performances from a variety of different traditions.

    Like many of my constituents, I am a citizen not only of this country, but of another—in my case, Australia. In this Parliament, I am the only Member also to be an Australian citizen. Like many of my constituents, I know what it is like to have families in two countries, so I know how much many families in my constituency warmly welcomed my right hon. Friend the Home Secretary’s early decision to abolish the odious primary purpose rule.

    I must mention also the parks and open spaces with which my constituency is so richly endowed. Perhaps suitably for Europe’s first Environment City, Western park in my constituency is home to one of the country’s leading green charities and consultancies, Environ, along with the flourishing city farm on Gorse Hill—both of which will, I hope, play a considerable role in creating the environmental task force within the east midlands.

    I regret to say, however, that our enjoyment of some of our open spaces is all too often spoiled by the arrival of unauthorised travellers, who themselves have too few authorised sites to which to turn. I hope that my right hon. Friend the Deputy Prime Minister will be sympathetic to the case that I will be making on behalf of my constituents for a badly needed review of the previous Government’s law and practice in this area, which has proved so disastrous.

    Perhaps too often neglected in my constituency and others like it are the outer-city estates. Almost half of my constituents live on such estates. Listening to my right hon. Friend the Secretary of State this afternoon, I found myself thinking in particular of families struggling to bring up children in communities where anything up to one in four of working-age men are officially unemployed—and where, in reality, far more are out of work.

    Young men all too often turn to destructive or criminal activities, because no creative outlet is offered for their energy. Children are growing up, as one grandmother said to me in fury and frustration, to believe that the only way they can earn a living is to sign on for a giro.

    Those are the people whom the last Government locked into unemployment and poverty, and then derided as an underclass. The people I have the privilege to represent are no underclass. They want a chance of a job, a chance to earn a living, a chance to bring up their families decently, to live in safety and to retire with dignity. They want the same respect and opportunity’ as other people. That is what the Budget will begin to give them.

    Listening to today’s speech by my right hon. Friend, I thought of Betty, for example, who is a parent governor at Wycliffe community college, which is located on one of the estates in my constituency. Recently, Wycliffe community college was inspected by the Office for Standards in Education. One member of the inspection team asked Betty how the school coped with local parents and with families living on income support—”you know”, he said, “with the underclass.”

    Betty said, “I’m one of the people you’re talking about.” She told him, “I live on benefit—not because I want to, but because my husband lost his job and hasn’t been able to get another one, and because we bought our council house, just as the last Government encouraged us to do. Now we find that the only way we can pay the mortgage is to stay on income support.”

    Betty left school at age 15 with no qualifications, returned to school, through Wycliffe college, and got herself five O-levels, which in itself is no mean achievement. She would love to train and work as a classroom assistant, and that school would love to give her the job. She cannot take such a job, however, for the simple reason that, as things stand, her family would no longer be able to afford their mortgage. It is such poverty traps, which were created by the previous Administration, that force families such as Betty’s to choose between the job they need and the home in which they live.

    I know how much Betty’s family and families in a similar position will welcome the announcements made in the Budget, and today by my right hon. Friend the Secretary of State, about the Government’s welfare-to-work programme and their longer-term objective of creating a benefit system that will at long last reward rather than penalise hard work and effort.

    I thought also of Bill, who is a manager at one of the employment projects on a local estate. Bill was a construction worker—a roofer—until he was injured in a fall from the roof on which he was working. He now says, however, that that accident was the best thing that ever happened to him, because it gave him a chance to discover within himself gifts that he did not know that he had. He is now running an employment advice project, into which he has introduced some wonderfully sophisticated software that, with his guidance, enables people who are lacking not only a job but the most basic confidence to start exploring their own real aptitudes and aspirations before taking that first step into training or a job.

    Bill said, “I know how hard it is to change. But I also know that people can do it, because I’ve done it myself.” I believe that the Government’s welfare-to-work programme will mobilise community groups such as Bill’s, marrying the bottom-up energy and potential of millions of people across the country to the Government’s top-down strategy and vision.

    I thought also of the lone mothers in my constituency who began another group, which they called Turning Point, because that is what it was for them. Originally, those lone mothers met to support one another over a cup of coffee around a kitchen table, but now they are running their own thriving voluntary organisation.

    I thought also of the staff and parents—fathers and mothers—who run creches and playgroups that have been starved of funds, sometimes to the brink of closure, because of the previous Government’s local council budget cuts. They are able to offer not only child care places but—in response to yesterday’s very welcome announcement—training places for young unemployed people who wish to work with children.

    I am sure that, like me, those parents hope that my right hon. Friend the Secretary of State will ensure that lone parents under the age of 25 who have spent six months or more out of work and on income support will be able to access the opportunities created by the welfare-to-work programme in the same way and on the same terms as other young people who have been on job seeker’s allowance.

    After listening to yesterday’s Budget and to today’s debate, I thought also of the teachers working and living in my constituency. Their dedication was scorned by the previous Government. Our new unitary council shares the new Government’s determination to ensure that all our children have a chance to fulfil their potential, whether they live in inner cities, in suburbs or on outer estates.

    I know that my right hon. Friend the Secretary of State will not be at all surprised if I say that several Leicester schools—including Dovelands junior school and Bendbow Rise infant school, which is in my constituency, and recently did its best to celebrate an anniversary while the rain poured in through the roof—will be early in the queue for the very welcome new capital funding and private finance initiative announced yesterday.

    Finally, I thought of the hundreds of women and men, many of whom are retired, who are now volunteers in so many community organisations, such as social clubs, youth sporting groups, children’s bands and other organisations. I thought also of the sometimes wholly unrecognised individuals who, in their own homes, are looking after children and other relatives with profound disabilities. Our social fabric is woven from all their efforts.

    Those men and women, and many others like them, are the heroes and heroines of my constituency. They and thousands of other people across the country will be the heroes and heroines of the new Britain that we were elected to build, and for which the Budget lays such a magnificent foundation.

  • Patricia Hewitt – 2006 Speech to Unison Health Care Conference

    patriciahewitt

    Below is the text of the speech made by Patricia Hewitt, the then Secretary of State for Health, on 24 April 2006.

    It’s a real pleasure to be here today with so many Unison health service workers. And it’s a particular pleasure to be back in Gateshead – a wonderful example of a city renewed.

    I know that our programme of NHS investment and reform is the cause of great debate amongst UNISON members. I know that you’ve had your rally today. I know from the regular contact I have with Dave Prentis, Karen Jennings and others of the concerns, the anxiety, even the anger that some of you feel.

    I want to hear about that directly from you – which is why I’ve asked for plenty of time for comments and questions this afternoon.

    This is a challenging time for the National Health Service and everyone working in it. Change brings both opportunities and uncertainties. So we all need to be honest and realistic about the challenges ahead, the tough decisions that need to be made – and why we are making further changes in the NHS. .

    But let’s also be honest and realistic about what you, the staff of the NHS, backed by our programme of investment, improvements and reform have already achieved.

    It is vital that, when we are debating the future of the NHS, we recognise the realities of how far we’ve come – as well as how much more we still have to do.

    The best year ever for patients

    That is why I make no apology for saying that from the patients’ point of view, the NHS – thanks to the efforts of all of its staff – has just had its best year ever for patients. The facts speak for themselves.

    We can all remember what it used to be like.

    March 1997 – 283,000 people waiting more than six months, in pain, for a hip replacement or other operation. Every winter an NHS beds crisis. Patients waiting on trolleys in A&E departments for hours and hours on end.

    No wonder the public told us what their priorities were. More staff. Better paid staff. And cut the waiting lists.

    And we’ve delivered. 307,000 more staff than we had in 1997. More staff – yes, and better-paid than ever before, and I make no apology for that either. Almost no-one waiting more than six months, and for most people far shorter than that – a target that people said was crazy when we promised it, and which the NHS delivered three months ago, in one of the coldest winters for decades.

    Last year, the NHS treated more people, faster and better than ever before – and we saved more lives than ever before. 43,000 more people saved from cancer, over 60,000 more saved from heart disease.

    No wonder, in every survey, patients tell us the health service is good – and it’s getting better.

    These are huge achievements, I think you are entitled to be proud of them – and to get more credit for them in our media.

    Financial problems

    But if things are so good, why are the headlines so bad? If the NHS is getting more money than ever before – which it is – why are there deficits, jobs being cut and some staff facing redundancy?

    Most of the NHS is not in deficit, of course. The majority of NHS organisations are in balance or surplus. The overall deficit in the NHS is just one per cent of the total NHS budget. That’s like someone on £20,000 a year having a £200 overdraft – it’s a problem, but it’s a manageable problem.

    The real challenge comes in the minority – 7 per cent of NHS organisations which are responsible for 50 per cent of the deficit: It can’t go on.

    We’ve written a very big cheque for the NHS, and we’re proud of that, But it’s not a blank cheque. It never has been and it never will be.

    So over-spending hospitals and other organisations do have to put their house in order. Because in the old NHS, the over-spenders were always bailed out by the under-spenders. The under-spenders were usually from the poorest communities and the greatest health needs. It wasn’t fair. And part of our reforms means that every hospital and every area has to take responsibility for getting the best possible healthcare and the best possible value for the extra money that we have asked the public to contribute. That means every hospital becoming more efficient in how it uses precious NHS resources, precious staff time.

    For some, that means cutting the money spent on agency staff – which as anyone will tell you is massively expensive. [West Hertfordshire] hospital, for instance, has a deficit of £17 million – and an agency staff bill of £16 million. So of course they should do what [many] other hospitals have done, re-organise their rotas to use their permanent staff better – and cut their agency bill.

    Those aren’t redundancies – even though they’re included in the headlines. It’s common sense.

    Most places will tackle their deficits and make themselves more efficient with few or no redundancies.

    But we will have to face up to some difficult decisions. And in some hospitals, there are staff facing redundancy.

    I met some of those staff a few weeks ago in North Staffordshire hospital, in Stoke. Utterly dedicated staff, working flat out – and working in two out of date, old-fashioned buildings. They’re now facing the shock and anxiety of a consultation on up to 1000 redundancies – although, as you’d expect, the hospital is doing everything possible to get that number down. But the problem they’re confronting is not just financial. The real problem is that the hospital isn’t organised in the most effective way possible.

    I met A&E staff, for instance, who told me that there are four different places, on two different sites, where patients can arrive in an emergency. And then some patients – many of them seriously ill – have to be moved from one site to another, so that they can be assessed, and sometimes they have to be moved back again, so that they can be admitted. Thousands of patient journeys a year – distressing and risky for patients, and a waste of precious hospital resources. So they’re going to put all the emergency work onto one site. But that means they will need fewer transport staff. They’re going to do more day case operations, because that’s better for patients – but it will mean they need fewer beds and fewer staff on some wards.

    This is a hospital that only last year was taking on new staff whom they couldn’t afford – staff who they wouldn’t in fact have needed if they’d organised their services better in the first place. I think that is grossly unfair on the staff, who were undoubtedly let down by the previous board of the hospital, a board that has now resigned. Thank goodness, it happens very rarely – but when it does, and when staff are left facing redundancies in a situation like that, I think they deserve an apology.

    I know how devastating redundancies are. That’s why we are working with staff representatives and local management to ensure that the threat of redundancy is contained to as few people as possible.

    That’s why we will support any staff member who loses their job to help them get new jobs and, if necessary, new skills.

    That’s particularly important when new medical practice and technology is making it possible to shift far more care out of hospitals and into health centres and community hospitals and even patients’ own homes. So our chief nursing officer, Chris Beasley, is already working with UNISON and other organisations on Modernising Nursing Careers – making sure we have the right framework to train and retrain people for NHS careers that will be even more varied, even more flexible than in the past.

    Engaging front-line staff

    I know that, in every organisation, the people who really know how to do things better and how to get rid of waste and inefficiency are you, the front-line staff.

    The best NHS managers are the ones who work most closely with clinicians and front-line staff – reducing the stress for staff, improving the care for patients.

    Let me give you just one example. The hospital where patients complained that the porters dragged them around backwards like a sack of potatoes. It was demeaning and disorientating, particularly for elderly people. It turned out that the porters were using wheelchairs that were so old and decrepit they couldn’t be pushed forwards. The porters had been saying it for years – but no-one had listened. At last, managers did listen. They bought new wheelchairs, let the porters do a proper, professional job … and that one small change transformed the support and reassurance the porters were able to give to a worried patient.

    I want every hospital, every manager listening to front-line staff, getting rid of waste – and making the improvements, small as well as big, that matter so much to patients.

    The need for change

    Let me turn now to the wider programme of improvements and reforms that we’re making in the NHS.

    I know that Unison isn’t against change. You helped lead the way in negotiating Agenda for Change – the biggest job evaluation scheme in the world – which not only means higher pay for most NHS staff, but even more important, new opportunities for staff to get more skills, take on more responsibility and work in different ways.

    I know there’s more we need to do to complete the implementation of Agenda for Change, including fair payments for workers doing unsocial hours.

    We need to get the new Knowledge and Skills Framework into place for staff by October. It’s agreed with 90% of staff – but we need improved personal development and skills for every one of our staff.

    We need to do more to persuade all trusts and contractors to sign up to the two tier workforce agreement – the new Code of Practice that I agreed a few months ago with Unison and the other NHS unions.

    All part of the changes taking place in the NHS.

    But there are other changes that are more controversial.

    We are giving patients more choice and more control over their treatment. It’s what people expect in every part of their lives. And the people who want it most from the NHS and other public services are people on low incomes – like my constituents in Leicester – who’ve never had the choice that the best-off and the best-educated can take for granted.

    We are bringing in the private and independent sector – not to take over from the NHS, but to contribute more capacity and even more innovation to the NHS.

    That includes the independent sector treatment centres that introduced mobile surgery units to the NHS and helped us cut waiting times for cataract patients to just three months – four years earlier than we said we would.

    We’re using private finance to build [70] new hospitals already – and the new hospitals we’ve just announced at Barts and the Royal London, St Helens and Birmingham, and many others to follow.

    That’s not privatisation, that’s progress.

    Every one of us in government, every one of us in the Labour Party, believes that the NHS must stay true to its founding values. Funded by taxation. Care based on clinical need, not your ability to pay. Treatment free at the point of need.

    That’s non-negotiable, at least as far as we’re concerned.

    But there are others who would abandon those principles.

    Doctors for Reform demanding the introduction of social or private insurance, an end to ‘free at the point of need’.

    The Daily Telegraph just last week, saying it doesn’t want progress, it wants privatisation.

    If we are to succeed in defending the NHS, free at the point of need, then we can only do so by changing to meet the three great challenges that confront every healthcare system in every developed country. Rapidly rising public expectations. An ageing population. Medical technology and science changing faster than ever before.

    That’s why the NHS has to go on changing.

    So there will be more arguments and controversy over the next year, and more difficult decisions to be made.

    But by the end of 2008, we will effectively have abolished waiting lists – the way the old NHS rationed care and kept within its budget. We will be giving patients a more personal service than ever before, with more choice about where you’re treated and appointments booked in advance to suit the patient, not just the provider. We will be treating more patients in the community and in their own home. And all of it free at the point of use.

    That is how we will protect Nye Bevan’s legacy, the legacy of the great reforming 1945 government.

    That is how we will persuade people that collective provision is not only fairer, but that collective provision can also meet people’s aspirations – 21st century aspirations – to be treated as an individual, to get personal services.

    That’s how we will protect the founding values of the NHS for another generation against those who want insurance, charges and privatisation.

    And that, friends, is a prize worth fighting for.

  • Patricia Hewitt – 2006 Speech at Royal College of Nursing

    patriciahewitt

    Below is the text of the speech made by Patricia Hewitt, the then Secretary of State for Health, in Bournemouth on 26 April 2006.

    It’s a real pleasure to be here today with so many members of the Royal College of Nursing.

    I want to hear what you have to say, which is why I’ve asked for plenty of time for comments and questions.

    But there are a few points I’d like to make first.

    I know you are angry about the prospect of redundancies amongst some NHS staff. Anyone facing the possibility of redundancy is entitled to be distressed and angry – and you are entitled to be angry on their behalf.

    This is a challenging time for the National Health Service and everyone working in it. So we all need to be honest and realistic about the challenges ahead, the tough decisions that need to be made – and why we are making further changes in the NHS. .

    We all know that the NHS is getting more money than ever before. But in that case, why are there deficits, jobs being cut and some staff facing redundancy?

    To start with, most of the NHS is not in deficit. The majority of NHS organisations are in balance or surplus.

    The overall deficit in the NHS is just one per cent of the total NHS budget. That’s like someone on £20,000 a year having a £200 overdraft – it’s a problem, but it’s a manageable problem.

    The real challenge comes in the minority – 7 per cent of NHS organisations which are responsible for 50 per cent of the deficit: It can’t go on.

    We’ve written a very big cheque for the NHS, and we’re proud of that, But it’s not a blank cheque. It never has been and it never will be.

    So over-spending hospitals and other organisations do have to put their house in order. Because in the old NHS, the over-spenders were always bailed out by the under-spenders. The under-spenders were usually from the poorest communities and the greatest health needs. It wasn’t fair. And part of our reforms means that every hospital and every area has to take responsibility for getting the best possible healthcare and the best possible value for the extra money that we have asked the public to contribute. That means every hospital becoming more efficient in how it uses precious NHS resources, precious staff time.

    Most places will tackle their deficits and make themselves more efficient with few or no redundancies. For example, cutting the money spent on agency staff – which as you always tell me is massively expensive.

    Re-organising rotas to use permanent staff better, getting the agency bills down – that’s not redundancies – even though they are included in the headlines. It’s common sense.

    But we will have to face up to some difficult decisions. And in some hospitals, there are staff facing redundancy.

    I met some of those staff a few weeks ago in North Staffordshire hospital, in Stoke. Utterly dedicated staff, working flat out – and working in two out of date, old-fashioned buildings. They’re now facing the shock and anxiety of a consultation on up to 1000 redundancies – although, as you’d expect, the hospital is doing everything possible to get that number down. But the problem they’re confronting is not just financial. The real problem is that the hospital isn’t organised in the most effective way possible.

    They’re not doing enough day-case surgery. Lengths of stay for some operations are well above the national average. Emergency care is split between two different sites and four different entrances. That’s not good for patients. And it’s not good value for money either.

    This is a hospital that only last year was taking on new staff whom they couldn’t afford – staff who they wouldn’t in fact have needed if they’d organised their services better in the first place.

    I think that is grossly unfair on the staff, who were undoubtedly let down by the previous board of the hospital. I think they deserve an apology.

    I know how devastating redundancies are. That’s why we are working with staff representatives and local management to ensure that the threat of redundancy is contained to as few people as possible.

    But we all recognise that new medical practice and technology are making it possible to shift far more care out of hospitals and into health centres and community hospitals and even patients’ own homes. Nurses are leading the way in making these changes. It’s what the public want … it was the central theme of our new White Paper, Our health, our care, our say that the RCN worked with us to develop.

    So our chief nursing officer, Chris Beasley, is already working with you in the RCN and other organisations on Modernising Nursing Careers – making sure we have the right framework to train and retrain people for NHS careers that will be even more varied, even more flexible than in the past.

    And as I said earlier this week, we need to do more to support any nurse or other staff member who loses their job to help them get a new job and, if necessary, new skills as quickly as possible … and we will work with you and others to make that happen.

    Record improvements

    Just as we should be open and honest with each other about the challenges we face, we should be open and honest about the achievements as well.

    And I want to congratulate the RCN.

    Next month, 12th May, you’re going to be celebrating Nurses’ Day.

    Celebrating your milestone of 400,000 members – particularly impressive when union membership has been falling in so many other sectors.

    You’re entitled to be proud of that … just as we’re all entitled to be proud of the fact that the NHS is employing over 85,000 more nurses than we were in 1997.. 34,000 more staff as a whole in the last twelve months alone, 307,000 more as a whole since 1997.

    More staff – better-paid staff – treating more patients faster than ever before, more people’s lives saved. Let’s tell the public about that too.

    Working together

    I have no doubt at all that the NHS works best when we all work together.

    We worked together on Agenda for Change – a ground-breaking agreement to ensure equal pay for work of equal value and to open up new opportunities and new careers to staff for the benefit of patients.

    We worked together to extend nurse prescribing.

    You pushed for a comprehensive smoking ban – and we will deliver that next year, even earlier than we originally planned.

    And we listened to you and many others on Commissioning a Patient-Led NHS. You told us we were wrong on PCT provision. We listened. I agreed we had made a mistake – and I said so, I changed it last autumn and confirmed the position again in the White Paper.

    So I want us to go on working together and listening to each other.

    Of course there will be occasions where we won’t agree.

    But there is one issue – the biggest issue of all – on which I believe we are completely agreed.

    The founding values of the NHS.

    Every one of us in government, and I am sure every one of you, believes that the NHS must go on being funded by taxation. Care based on clinical need, not your ability to pay. Treatment free at the point of need. The fairest healthcare system in the world.

    That’s non-negotiable, at least as far as we’re concerned.

    But there are others who would abandon those principles.

    Doctors for Reform demanding the introduction of social or private insurance, an end to ‘free at the point of need’.

    The Daily Telegraph just last week, saying it doesn’t want progress, it wants privatisation.

    If we are to succeed in defending the NHS, free at the point of need, then we need to meet the challenges that confront every healthcare system in every developed country. Rapidly rising public expectations. An ageing population. Medical technology and science changing faster than ever before.

    That’s why we’re giving patients more choice and a more personal service. That’s why we believe in more diverse providers, including NHS social enterprises and not-for-profit organisations – as well as the private sector – not to take over from the NHS but to give patients better, faster care. And that’s why we’re shifting services out of hospitals and into the community, to improve care for patients and free up more resources for new drugs and treatments.

    So there will be more arguments and controversy over the next year, and more difficult decisions to be made.

    That is how we will persuade people that it is worth paying more for the NHS. Persuade people that collective provision is not only fairer, but that collective provision can also meet people’s rising aspirations – 21st century aspirations – to be treated as an individual, to get personalised services.

    That’s how we will protect the founding values of the NHS for another generation against those who want insurance, charges and privatisation.

    And that is a prize worth fighting for.

  • Patricia Hewitt – 2006 Speech at HR in the NHS Conference

    patriciahewitt

    Below is the text of the speech made by Patricia Hewitt, the then Secretary of State for Health, on 27 April 2006.

    It’s a real pleasure to be here today with you, at this important conference about the future of Human Resources practice in the NHS.

    I want to hear from you this afternoon so I’ve asked for as much time as the conference programme will allow for your comments and questions.

    But let me place our discussions today in the context of the programme of investment and reform that we have embarked upon. Starting in 2000 with the NHS plan, what we tried to do was build a patient-led, responsive to the demands of a changing society, and robust enough to prosper into this new century. But crucially, true to the founding values of the NHS: free at the point of need, available to all of us, and funded by all of us through a progressive system of taxation.

    This is a challenging time for the National Health Service and everyone working in it. So we all need to be honest and realistic about the challenges ahead, the tough decisions that need to be made – and why we are making further changes in the NHS. .

    But I also think we have to be honest and realistic about what the improvements and reform have already achieved.

    The facts speak for themselves.

    Almost no-one waiting more than six months, and for most people far shorter than that – a target that people said was crazy when we promised it, and which the NHS delivered three months ago, in one of the coldest winters for decades.

    Last year, the NHS treated more people, better and faster than ever before – and we saved more lives than ever before. 43,000 lives were saved from cancer, over 60,000 more saved from heart disease.

    No wonder, in every survey, patients tell us the health service is good – and it’s getting better.

    I think you and all the NHS staff are entitled to be proud of these achievements. I think you deserve more credit for them than the media sometimes gives you.

    We have 307,000 more staff than we had in 1997, including 85,000 more nurses and 33,000 more doctors.

    More staff – yes, and better-paid than ever before, and I make no apology for that either.

    And let me make it absolutely clear: I do not believe that we have too many managers in the NHS. I am fed up with people who talk about managers as if it is a dirty word. I believe we need the very best managers in the NHS, working with clinicians and other frontline staff to deliver the very best care for patients with the best value for money.

    You can’t run an organisation of 1.3 million staff and a budget which will be £92 billion by 2008, without first rate management.

    Financial problems

    But if things are so good, why are the headlines so bad? If the NHS is getting more money than ever before – which it is – why are there deficits, jobs being cut and some staff facing redundancy? Why are you having to make some very difficult decisions?

    Most of the NHS is not in deficit. The majority of our NHS organisations are in balance or surplus. The overall deficit in the NHS is around one per cent of the total NHS budget. That’s like someone on £20,000 a year having a £200 overdraft – it’s a problem, but it’s a manageable problem.

    The real challenge comes in the minority – 7 per cent of NHS organisations which are responsible for around 50 per cent of the deficit: It can’t go on.

    We’ve written a very big cheque for the NHS, and we’re proud of that, But it’s not a blank cheque. It never has been and it never will be.

    And that’s why I am so clear that over-spending hospitals and other organisations do have to put their house in order. You know better than I do that in the old NHS, the over-spenders were always bailed out by the under-spenders. The under-spenders were usually from the poorest communities and the greatest health needs. It wasn’t fair. And part of our reforms means that every hospital and every area has to take responsibility for getting the best possible healthcare with the best possible value for the extra money that we have asked the public to contribute.

    Hospitals have to become more efficient in how it uses precious NHS resources, precious staff time. And you know how to do that.

    You’ve been telling me that you just don’t recognise these headlines about mass redundancies. Cutting down on agency staff, as many of you are doing, isn’t redundancies. It’s good management. And it delivers better care for patients.

    And from figures published today, the cost of sickness absence: a cost of on average £5.4 million for every single NHS Trust. We can do better by our staff, and save money at the same time.

    Most places will tackle their deficits and make themselves more efficient with few or no redundancies and the more you and we can explain that to our staff, and the media, the better.

    But of course there are difficult decisions. And in some hospitals, there are staff facing redundancy.

    I know how devastating redundancies are. That’s why I know you are doing everything possible, working with staff representatives to ensure that the threat of redundancy is contained to as few people as possible.

    You, as HR professionals, know that every redundancy is a blow to the individuals, their families, and the people they leave behind. You understand the need for sensible, sensitive management processes, and a good dose of human compassion and common sense.

    That’s why we will support any staff member who loses their job to help them get new jobs and, if necessary, new skills.

    Explaining this is particularly important when new medical practice and technology is making it possible to shift far more care out of hospitals and into health centres and community hospitals and even patients’ own homes.

    Every one of us here believes in the NHS – funded by taxation, free at the point of need.

    But not everybody believes in these principles.

    Doctors for Reform demanding the introduction of social or private insurance, an end to ‘free at the point of need’.

    The Daily Telegraph just last week, saying it doesn’t want progress, it wants privatisation.

    If we are going to defend the NHS, free at the point of need, then we can only do so by changing to meet the huge challenges that confront every healthcare system in every developed country. An increasingly demanding public. An ageing population. Medical technology and science changing faster than ever before.

    That’s why the NHS has to go on changing.

    That’s why, together, we have to make difficult decisions.

    But look at the prize.

    But by the end of 2008, we will effectively have abolished waiting lists – the way the old NHS rationed care. We will be giving patients a more personalised service than ever before, with more choice about where you’re treated and appointments booked in advance to suit the patient, not just the provider. We will be treating far more patients in the community and in their own home. And all of it free at the point of need.

    We are making some structural changes. But what really matters is cultural change.

    And you are the experts.

    Your job is not a back office function. It is on the front line, supporting our staff with skills they need to give the best care to our patients.

    Thank you.

  • Patricia Hewitt – 2006 Speech to NHS Confederation

    patriciahewitt

    Below is the text of the speech made by Patricia Hewitt, the then Secretary of State for Health, on 20 June 2006.

    I want to thank the Confederation – Peter, Gill and all your team – for your leadership of the Confederation. The leadership you showed in your recent report challenging the idea that bed numbers are the measure of success. The leadership and support you have provided this week to this vital part of the NHS family.

    I have learnt a great deal over the last year, and what I’ve learnt has deepened my admiration for NHS staff and my absolute determination to give you the support you need to give every patient and user the best possible care.

    I am here, as always, to listen to you – which is why I’ve asked Ian to join me for a discussion with you. But I want to take the next 15 minutes or so to acknowledge the difficulties we are facing, talk about the change in culture we need and underline why the reforms are so important.

    The last twelve months have been far more difficult than we anticipated. So I am here, first and foremost, to thank each of you for the leadership, the dedication and the sheer professionalism you contribute to the NHS.

    And in thanking you, I am also here to celebrate with you the extraordinary achievements of the NHS.

    Just one example. There is scarcely a family that hasn’t been affected by cancer. That’s why we made it a priority and asked you to get rid of the delays between the GP’s referral and the start of treatment.

    And you’ve done it.

    I also know that it is first-rate managers who make first-rate care possible. I spent a morning recently with the cancer team at the Whittington Hospital, sitting in on the multi-disciplinary team meeting, … I saw for myself, what you see every day, brilliant clinicians and front-line staff absolutely focussed on what each individual patient needed. And it was the clinical director (Mrs Celia Ingham-Clark, a consultant surgeon) who told me that the person who made the team’s work possible was Stephen Dunne, who helped patients navigate around the system, ensuring that everyone had the information they required.

    It is people like Stephen, it is you and all your colleagues who have made it possible to bring down the waiting lists, get rid of the trolley waits in A&E, save the lives of thousands of cancer patients.

    We put in more money. But you did the work.

    I will go on championing your successes and telling people about the extraordinary achievements of the NHS in every part of our country. That’s part of my job as health secretary.

    But I will also tell the truth about the difficulties we face.

    As I look around at a world that is changing faster than most of us imagined even ten years ago, as I see the extraordinary potential of scientific breakthroughs to transform people’s health and well-being, as I find health services across the developed world learning from what we are doing here in the NHS, I am excited this about journey of change that we are on.

    But I know that excitement is probably not the emotion most of you feel right now. Anxiety. Uncertainty. Weariness that change never seems to end – and that change seems to be done to you, not by you. That’s what I hear people telling me.

    I know that the latest changes to the strategic health authorities and PCTs compound those feelings, even amongst those of you who believe we’re making the right changes. We are making the changes because we believe they will help make life better for patients and the public. But they are also making life very hard for many of you. Some of you here don’t know if you will have a place in the new structure or what that role might be. Together, we need to do more to support everyone who is facing that insecurity.

    There is another reason why I want the opportunity for dialogue with you today. Some of the things you’ve taught me have shocked me. The senior member of a PCT, for instance, who told me that she knew last year’s financial plan was unachievable … but she’d been told submit the plan anyway, and if there were problems, that was her problem.

    Of course it isn’t like this everywhere – but too many people have talked to me about a macho culture, bullying, not being able to give bad news.

    Ian said yesterday that the centre wasn’t listening.

    That has got to change.

    So our discussions here are part of creating a new culture: leaders who listen – to bad news as well as good – a culture of openness, honesty and respect. I want that in every strategic health authority, in every PCT, every part of the NHS and throughout the department of health – and I will go on reinforcing that expectation with all my colleagues including the Boards of the new health authorities and Trusts.

    From “top down” to “bottom up”

    But if we’re going to keep on changing, it has to be the right kind of change. When we started making the investment, when we launched the NHS Plan, we needed national standards and targets to make sure the changes happened everywhere.

    But you’ve taught me that there is now too much top-down micro management, too much emphasis on targets set by Ministers – and not enough support for managers and clinicians and other front-line staff to respond directly to patients and users and local communities.

    The vision of the NHS plan, “care shaped around the needs and concerns of patients.” That’s the vision for today and tomorrow. And it can’t be achieved by diktat from Richmond house.

    So we need to create a system with in-built incentives to improve and innovate. A system that supports you to look outwards to patient and users, rather than upwards to Whitehall and Ministers.

    Of course there will still be national standards: without them, empowering front-line staff and local communities just creates inequality and a post-code lottery.

    But within a framework of national standards, fair funding and proper accountability, we need to shift the whole emphasis from top-down targets and performance management from Whitehall to change from the bottom up.

    And that’s exactly what this next stage of the reforms will do.

    The four parts of the reform programme work together.

    First, more choice for patients with stronger commissioning by PCTs and practices. We know the public want more convenient, more personal, more local services when they’re ill. But they also want the NHS to support them in becoming and staying as healthy and independent as possible.

    As we build on the success that so many PCTs have already achieved, and deepen our understanding of what excellent commissioning means, you will have the tools to focus on the needs of every community, to do more – not less – on public health and prevention, and to work with local practices to design services around the needs of individuals not institutions.

    By giving GPs and practices more freedom and more responsibility, with practice based commissioning, we are creating the right incentives to do that everywhere.

    Of course, choice has to be within available resources. But for elective care, as we give more choice to patients, we also give every hospital a powerful incentive to focus on how to give patients faster access and better, more personal, more convenient care.

    But for choice to be real – and for commissioners to get the best services – we need providers who are constantly looking for better ways of achieving the outcomes that patients, local people and commissioners want.

    So the second element in the reforms is a greater diversity of providers, with more freedom to innovate and improve – but also more responsibility for their own success.

    Its been there for a long time in mental health and care for older people. We’ve now extended it to acute services.

    In primary and community services too, we will increasingly see new providers adding to the great diversity that already exists. Services provided by local authorities, PCTs, GP practices … but also nurse practitioner led services, private firms, social enterprises and the third sector.

    When East Derbyshire PCT wanted new and better primary care services for one of their communities, they didn’t specify who was going to provide it, they specified the services people wanted – and they chose the provider who they believed would offer the best. We’re all patients and users ourselves, isn’t that what we’d all want our local NHS to do?

    I have no doubt that this diversity brings great strengths to the NHS. But it also brings greater complexity. Sometimes different organisations will be competing to offer the best possible care. Sometimes you’ll be collaborating with other organisations to provide the care that an individual patient or a whole community needs. All within the NHS family. All of it free at the point of need.

    And then we need the third element of our reforms, payment by results. We have to get it right, we have to give you proper time to plan – and we’ll work with you over the next few months to do both.

    But the reality is that the tariff supports patient choice, it will empower practice based commissioners and it is crucial in both driving improved efficiency and liberating clinical staff , inside and outside hospitals, to develop the services that patients want.

    And the fourth element, of course, is the Regulatory Regime that we need – particularly to guarantee safety and quality – so that we can promise the public that the services will be there for you, wherever possible you will have a choice and on the NHS you can’t make a bad choice. It’s not easy to design a light-touch regulatory regime that fulfils our promises to patients without stifling your ability to innovate. But we’re determined to do it and we will be saying more on this next month.

    Meeting future challenges

    We all know there are huge challenges facing every health service. People want more. Medicine can do more. And we have to cope with these new demands and new costs within a budget that will be higher than ever before because we’ve asked people to pay more than before. But even in 2008, when we will have trebled the NHS budget and reached European levels of healthcare spending, the NHS will still have to live within its means.

    So what do we do? Do we cut back on the services that we should be providing? No. We’re not going to do that.

    Do we make patients pay top-up fees – as some on the Right are demanding. Never, because that would destroy the values of the NHS.

    Or we can do what you’ve been asking for this week: make services far more productive – improving care for patients and improving value for patients and the public too. That is how we safeguard the values of the NHS for another generation.

    We will never turn healthcare into a business. But we can and we must be more business-like. Not because we care more about money than about patients but because, as the Prime Minister said this week: every pound wasted is a pound not spent on the values of the NHS.

    Conclusion

    The final point I want to make before our discussion is about my responsibility to you.

    I believe my job is to create the space for you to do your job.

    I will play my part with Ian in creating the different kind of leadership that is needed for the next stage of our journey.

    Less day-to-day interference: more collaboration and empowerment.

    Less instructing, more listening: to the bad news as well as the good.

    Not ‘its your fault’, but ‘its the responsibility of us all.’

    And I will make sure that if you have the best plan for patients but need to take difficult decisions to deliver them on the ground, we will give you the political support you need to make those changes happen.

    Those are the targets you are setting me: the targets I am setting for myself.

    And when we meet here again in twelve months’ time, we will know that we are on the right track – not just because we will be back in financial balance. But because, together, we will be creating the culture and the partnership that is right for you, right for patients and true to the values in which we all believe.