Tag: Speeches

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 30 April 2003.

Domestic politics is back. This week there will be important elections in Scotland, Wales and England. Over these last few months, Iraq put bread and butter issues on hold. The Government’s decision on the Euro could have a similar effect. But whilst Iraq and the Euro are hugely important for the future of our country and the wider international community, it is not the five tests on the Euro that will determine this government’s fate. It is the three big domestic tests: delivering on jobs and the economy, crime and asylum, health and education.

Here there is a stark choice for the Government. To pursue the cautious incrementalism that sometimes characterised our first term, or to embark on a more fundamental transformation of our country. It is the latter course of action I believe we must choose if we are to successfully meet each of these three key domestic tests.

Reassurance was right for our first term. Radical reform is what is needed now. Not reform for reform’s sake but reform to open up new opportunities for people to deliver on our commitment to social justice.

So for public services that means using the considerable extra resources now going in to health and education to reinvent collective provision for today’s world.

Some find that an uneasy proposition. Reform in health or in education is often caricatured as being in conflict with the values of the Centre Left – as though reform can only ever come from the Right.

That is to confuse ends with means. The ends remain – of strong public services capable of providing opportunity and security in a globalised and increasingly uncertain world. It is the means of securing them must now change as society itself has changed.

We are in a century where deference is lower but expectations are higher than they were in the century that saw the creation of these great public services.

So, today I want to set out the case for public service reform. And I want to do so with particular reference to the changes we seek to make in the National Health Service including NHS Foundation Trusts.

My starting point is this: strong public services are the best provider of opportunity any society can have. A good education helps lift people up. A good police and criminal justice system keeps communities safe from harm. And a good health service secures the health of the nation.

All my adult life I have argued for policies and for values that are about widening opportunity in our society. That is why I believe the NHS is such a source of strength for our country. It expresses the values that I believe in. Solidarity, community, opportunity. With the NHS we all share in the security – Nye Bevan called it the serenity- of knowing that we all pay in when we can do so that we all can take out when we need to. The health of each of us depending on the contribution of all of us.

These were the ideals that inspired the generation of Bevan and Beveridge. They remain our inspiration today.

Indeed, I believe profoundly that the case for the NHS system of funding and values is stronger today than it has ever been. Now more than ever, we live in a world where health care can do more but costs more. Since none of us knows when we will fall ill, how long it will last or what it will cost, having an NHS that pools risk because it is funded through general taxation and is free at the point of use, based on need not ability to pay, is the right way forward for our country.

Conversely, the market-based approach favoured by others would be both inefficient and unjust. As the costs of treatment and drugs grow, the risks to family finances of pay-as-you-go and health vouchers would grow too.

I reject the vision of some privatised future where the health care you are guaranteed for your family is the health care you insure for privately or pay for, in part or in whole. Where poverty bars the entrance to the best treatments. I reject the dogma of those whose dislike of public services is such that they would prefer a private sector working inefficiently to a public sector working well.

It is because we recognise the unpredictability of health needs, the rising costs of heath technology and the equity and efficiency of the NHS tax funded system that for us the NHS will remain a National Health Service – a public service free at the point of use with decisions on health care always made by doctors and nurses on the basis of clinical need.

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

I believe we are right to raise tax to increase spending in the NHS and the increased spending we have been putting in is beginning to repay that declaration of faith. More doctors and nurses. More drugs being prescribed. More patients being seen. Shorter waits for treatment. As the Modernisation Board put it recently there is a long way to go but the NHS is now turning the corner.

But money alone, however, cannot deliver the modern responsive health services our nation needs. To get the best from the money the NHS needs to be properly organised. I have heard it said that since the extra investment is now paying dividends in the NHS further reforms are not needed. It is true that the resources are tackling the historic capacity problems the NHS has faced for decades. What is equally true however, is that the NHS has cultural barriers that must also be overcome if it is to reach its full potential. That cannot be achieved through investment. It can only be achieved through reform.

The NHS has great strengths in how it has been organised. For over fifty years it has provided good care and treatment for millions according to the right values. Its ethos and its staff express the values of the nation. Its unitary structure gives it great advantages both in overall levels of efficiency and its focus on public health. Its primary care services, led by Britain’s family doctors, are the envy of many other countries.

But the NHS has structural weaknesses too, not least its top down, centralised system that tends to inhibit local innovation and its monolithic structure that denies patient choice. NHS Foundation Trusts are a means of overcoming that faultline.

And for those of us on the Left the most depressing thing of all is that despite having the fairest health care system in the world, for fifty years the gap between the health of the wealthiest and the health of the poorest has widened not narrowed. A boy born today in Manchester will live on average a decade less than a boy born in Dorset.

For half a century, uniformity of provision has not guaranteed equality of outcome. Too often, even today, the poorest services are in the poorest communities. The hard fact is that for over fifty years it is poorer people and poorer communities who have lost out from poorly provided public services.

That is an affront to all that I believe in. For me, the only purpose of being in politics is to build a society where, regardless of race or gender or social class, there is opportunity for all not just for some.

Take choice, which the Left has mistakenly conceded to the Right. For too long choice in health care has only ever been available to those with the means to pay for it. Those with more money have been able to exercise more choice. That is the real two-tier health care in our country.

The trap we must avoid is that identified by Richard Titmuss four decades ago of so many people opting out of publicly provided health and education that public services become only for the poor and then end up themselves being poor services.

Then there’s the pensioner with modest savings. Worked hard, paid in all his life, finds he needs a heart operation and then is forced to choose between waiting for treatment or paying for treatment.

That is a dilemma I want to solve. The way to do it is to reduce the waiting times and make choice available on the NHS; choice for all not just for some so that for the first time NHS patients can choose hospitals rather than hospitals choosing patients.

The route to patient choice lies not through more healthcare charges but through big cultural changes. The cultural changes which redesign services around the needs of patients so that they are able to make choices about where and when and by whom they are treated. And so that NHS patients can make that choice free of charge, within the NHS.

So it is right to be bold on reform. But boldness is not an end. It is a means to an end. It should be about making health services more responsive so they can provide more opportunities for the communities they serve. That is the purpose of our reform programme in general and NHS Foundation Trusts in particular.

We must not allow our reform programme to be caricatured as a values-free zone. It is actually quite the reverse. It is about strengthening our public services as a means of securing the values that guide us – of social justice and stronger communities. It is boldness for a purpose.

So it is right to press ahead with fundamental reform in how the NHS works. For some – particularly on the Left – this is not an easy process because the NHS is in our blood. For many it is the touchstone of all that we stand for. And yet in our hearts we know that the NHS needs to be better – not because it has failed but because the world has changed.

Sixty years ago when the NHS was formed it was the era of the ration book. People expected little say and experienced precious little choice.

Today we live in a quite different world; a consumer age; the computer age; the informed and inquiring society. People demand services tailored to their individual needs. People want choice and expect quality.

We all do it and we all know it. These changes cannot be wished away. They are here to stay. And these changes challenge every one of our great public services.

To meet that challenge we’ve got to move on from the one-size-fits-all, take-it-or-leave-it, top down health service of the 1940s towards an NHS which embraces devolution, diversity and choice – precisely so that its services can be more responsive to the way the world is today.

Unless we do so, more and more of the public will simply walk away from public services eroding the national consensus that supports them. Reform is not about undermining tax-funded public services. It is about strengthening that consensus by making the NHS more responsive to those who use it.

In our first term we rightly sought to do that by putting in place a new national framework of standards. It is easy to forget how far we have come. There are new national standards for cancer, heart disease, mental health, elderly care and now for children’s services. There is greater transparency over local service performance so that we and more importantly, patients and staff, can spot if things are going wrong and put them right. There is a new legal duty of quality and a new system of clinical governance to enshrine improvements throughout the NHS.

There is the National Institute for Clinical Excellence to tackle postcode prescribing. For the first time the NHS has an independent inspectorate. With the NHS Modernisation Agency there are now new systems for when things go wrong and more help to learn from what goes right. There are clear targets to focus effort across the whole NHS not least to address the biggest public concern about the health service – how long patients wait for treatment. And for all the comment about targets no one should kid themselves that we would be making the progress we are now – with waiting times falling on virtually every indicator – without the targets we have set.

These measures have all served to strengthen equity in the NHS. And I believe they were all necessary to kickstart the process of improvement that was overdue. But the NHS cannot be run forever like a 1940s-style nationalised industry.

National targets and standards are important but ultimately improvement is delivered locally not nationally by frontline staff in frontline services. And that is where power needs to be located if those services are genuinely to be responsive to local communities.

Sustaining improvements in NHS performance can only happen when staff have more control and local communities have a greater say in how services are run. Disempowering frontline staff – whether it is doctors or nurses, social workers or police officers, teachers or managers – is never going to be the best way to run a public service. That’s why we have devolved power to Primary Care Trusts and why we want to establish NHS Foundation Trusts. It is right to set standards nationally but it is wrong to try to run the NHS nationally.

Just as there are limits to the role of free markets in health care, there have to be limits to the role of the centralised state.

Ours is a small country with big differences. It is not uniform. It is multi-faceted and multi-cultural. Different communities have different needs. We have local councils to run local services because we recognise that needs do differ between communities. What is true for social services is also true for health services. With the best will in the world, those needs cannot be met from a distant Whitehall. They can only be properly met locally not nationally.

That is why, with a national framework of standards and inspection now in place, the centre of gravity is shifting decisively to the NHS frontline. More devolution to primary care trusts, more diversity in provision, more choice for patients to open up the system so that it is more responsive to those who use it. NHS Foundation Trusts are part of that process.

We are now in transition from the old order to the new. As we set out in the NHS Plan the more performance improves the more control local health services will assume.

Rather than trying to drive improvements simply through top-down performance management, the transition is towards improvements driven through greater local autonomy in which PCT commissioning, new financial incentives and the choices patients make become the driving force for change, backed by national standards and independent inspection. That transition will take time but the direction of travel is now set – and it must not be reversed.

NHS Foundation Trusts are the next stage in that journey. In some quarters it is a controversial policy; for many in the NHS it is a welcome one.

Since I first outlined the policy more than a year ago, there have been a number of myths and misconceptions about what we intend to do and how we intend to do it. So let us nail some myths today.

NHS Foundation Trusts will be NHS hospitals. They will be fully part of the NHS but with greater freedom to run their own affairs.

Freeing NHS Foundation Trusts from day-to-day Whitehall control will improve care for patients by encouraging greater local innovation in service delivery. It will help unleash that spirit of public service enterprise that exists in so many parts of the NHS but for too long has been held back.

NHS Foundation Trusts will be owned and controlled by the public locally not nationally so as to strengthen the relationship between local hospital services and local communities.

In place of the centralised system of government appointments to hospital boards, for the first time there will be direct elections by local people and local staff of hospital governors.

Strengthening public ownership by making NHS Foundation Trusts more locally accountable will particularly help improve services in poorer areas. Indeed I very much welcome the fact that hospitals in some of the most deprived areas of the country, including Hackney, Liverpool, Bradford, Doncaster and Sunderland have all expressed an interest in being amongst the first NHS Foundation Trusts.

We are starting with existing three star NHS hospitals. In time the Foundation principle will be extended to mental health trusts and other parts of the NHS. To date 32 NHS Trusts have applied. I will be making decisions about those applications shortly. I hope to be able to approve the vast majority of them. But that is just the start. I will also be bringing forward plans – including extra financial support – to help each and every NHS hospital to become an NHS Foundation Trust over the course of the next four to five years. A policy, in other words, that is for all and not just for some.

This is part of an ‘equity guarantee’ that the Bill introducing NHS Foundation Trusts enshrines. That equity guarantee means that NHS Foundation Trusts will remain part of the NHS providing services to NHS patients according to NHS principles – care for free, based on need not ability to pay. It means they will be subject to NHS standards and systems of inspection. And it means they will be bound by a legal duty to work in co-operation with others to improve the quality of health care throughout the NHS in keeping with our values where the strong support the weak for the benefit of all.

So NHS Foundation Trusts will be built on the values and principles of community empowerment, of staff involvement, and of democratisation. Indeed the way they will work draws on some of this country’s best traditions of mutualism and co-operation. They draw too on international experience of greater independence improving performance in hospitals across Europe.

This is not the reinvention of an internal market. Far from it. NHS Foundation Trusts will get their income through local Primary Care Trusts, just like every other NHS hospital. They will all work within the flexibilities of the Agenda for Change pay system we have negotiated with the NHS trades unions.

There will be no competition based on hospitals offering the lowest price. In future all hospitals will be paid a nationally set price for the same procedure. Those who treat more NHS patients should of course get more NHS money. So there will be a payment by results system but NHS Foundation Trusts can not make a profit or pay a dividend. There will be a legal lock on their NHS assets ensuring their continued use for NHS patients and the proportion of their income from private patients will be capped at current levels.

So those who claim this is privatisation or a step in that direction – through the front door, through the back door or through the side door – are simply wrong.

By all means let us debate NHS Foundation Trusts but let us do so on the basis of what the policy is rather than what it is not. Greater local freedom, real local ownership, genuine staff involvement to give more responsive services and ensure community needs are better met.

NHS Foundation Trusts are part of a wider reform programme aimed at getting the right combination of national standards and local control. Both are needed if services are to improve and if the case for collective provision is to be won.

The Government has made public services the key political battleground in our country. We have staked our reputation on being able to deliver the improvements in public services that have escaped governments for decades. And we have embarked on a high risk but necessary strategy of raising taxes in order to raise resources for the health service and other key public services.

We have been right to do so. But we need to recognise that in so doing we have raised the stakes. Collective provision of public services – whether in health, education or local government – is challenged as never before.

The Right – in the media and in politics – believe the game is up for services that are collectively funded and provided. In today’s consumer world they argue that the only way to get services that are responsive to individual needs is through the market mechanism of patients paying for their treatment.

It is easy to dismiss the Right’s policies as the last twitch of the Thatcherite corpse. But if we fail to match high and sustained investment with real and radical reform it will be the Centre-Left’s argument that public services can both be modern and fair, consumer-orientated and collectively provided that will face extinction.

We will win the argument for public service investment and reform if we accept that the era of one-size-fits-all public services is over and that the Centre-Left’s approach today should be based on decentralisation, diversity and choice.

Our objectives – social justice and opportunity for all – remain. It is our means of delivery that must now change. Our job in carrying through these reforms is to preserve values and yet still change structures.

Reform is difficult. It is often controversial. The pioneers who created the NHS found that. The job of re-creation and renewal will be no less difficult. But we will be failing the public if we did anything other than press ahead with reform. The Government’s foot needs to be firmly on the accelerator not on the brake. We have just entered the period of unprecedented expansion when it comes to investment. We must keep up the pace of reform.

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 3 April 2003.

Mr President, my Lords, ladies and gentlemen,

It’s a great pleasure to be here with you this evening and particularly to follow both John and Cliff.

It’s three years since I last had the pleasure of addressing you. I announced then the creation of the PICTF- an important symbol of the co-operation that I believe exists between industry and Government in our country. And I join with John in praising the leading role that colleagues from the ABPI and especially Phil Hunt played in taking that co-operation forward.

Tonight I want to suggest how we can build on that strengthened relationship.

The starting point is this simple insight: the health of the country and the health of your industry are intimately linked. The stronger our partnership the better it is for Britain.

Your industry as John rightly said is a major contributor to the wealth of our nation – and therefore ultimately to the funding of the great public services on which people in our nation rely. Indeed the Pharmaceutical Industry is a competitive and innovative, knowledge-based and high value-added industry. You are genuine world leaders – second only to the US in the discovery and development of the world’s leading medicines. Our job in government is to create the environment in which you can thrive.

A stable economy; a flexible and skilled labour market, a world-class university sector and science base – these are the keys to unlocking success in what is, as you know, a highly competitive global market place. On each of these fronts there is reasonable progress to report.

For example, we believe in investing in science. By 2005 the science budget will stand at nearly £3 billion – more than double what it was just a few years ago. Investment that will help grow your future workforce and sow the seeds for future scientific advance. The new R&D tax credits we introduced last year I hope will help that process. The green light that Parliament has given to stem cell research not only provides a further basis for new scientific endeavour but holds out the hope of new breakthroughs in the treatment and prevention of serious illness.

And for research to thrive it needs proportionate regulation and it also needs a safe environment – which is why John was right to highlight the threats posed by a small minority of animal rights extremists. I know that some of you here tonight will have been targeted by these people. Many more will have felt intimidated by them. All I want to say to you is that the Government unreservedly condemns their campaign of violence and intimidation. We are determined they will not succeed. That is why we have taken action to improve co-ordination between the police and other agencies. It is why we have strengthened the law. And I can say tonight we do not rule out further changes to the law to remove the threat that these extremists pose.

I believe that we must deal with those threats in order that we can realise the very real potential that now exists. Over these next few years a growing National Health Service and the prospect of further pharmaceutical advance provide new opportunities for both industrial prosperity and better health.

The NHS is in a period of unprecedented growth. By 2008 its budget will be double that of just a decade before. We have the fastest growing health care system of any major country in Europe. There is of course a huge amount of catching up to do. Nonetheless there aren’t many organisations in this country – perhaps not in the world – that know what their budgets will be in five years time. The NHS is in that enviable position.

The fruits of increased investment are already plain to see. Not just in the growth in nurses and doctors, more beds and new hospitals but in shorter waiting times for treatment and improved standards of care. In the last year alone there were around 30 million extra prescriptions for patients. The NHS drugs bill rose by £850 million. That represents a year-on-year increase of nearly 14 per cent, with a similar rate of growth likely this year.

I said three years ago that more spending on medicines is, in my view, a good thing, not a bad thing. Provided of course that the extra money is spent effectively and gets good value. Some feared, three years ago, that the advent of the National Institute for Clinical Excellence – and I pay tribute tonight to its work under the leadership of Sir Michael Rawlins – would act as a brake on drug spending in the NHS. Those who thought that obviously got the wrong pedal. NICE has not slowed down expenditure on new drugs. It has accelerated it. NICE decisions since it was set up three years ago have cost the NHS over £700 million. Amongst those benefiting have been an additional 31,000 cancer patients, 160,000 diabetes patients, 100,000 people suffering from alzheimers disease and 170,000 more who can benefit from atypical antipsychotic drugs. In the last year alone, as John said, prescribing of statins has risen by 30% benefiting over one million people and helping to save an estimated 6,000 lives.

Now as John commented – and I got the message – there is more that needs to be done. And just for the avoidance of doubt: I did not set up NICE so that its recommendations could sit gathering dust on the shelves of Primary Care Trusts. You want the guidance implemented, I want the guidance implemented and I will ensure that this is precisely what happens.

And over time I would expect to see the importance of medicines to the NHS continuing to grow. And in all likelihood drugs spending as a proportion of NHS spending will also continue to grow. Too much of the debate on health care today in my view is still focussed on the narrow terrain of hospital-based activity. Now what happens in hospitals is, of course, incredibly important. But it is not the be-all-and-end-all of what the health service does. Indeed changes in demography and the pattern of illness alongside scientific advance and technological breakthroughs are driving the NHS towards more health care being delivered in a non-hospital setting. As today’s World Cancer Report from the WHO argues, the focus increasingly needs to be on prevention, not just treatment. The work we have done together in government and the industry has given the NHS a world-leading smoking cessation service sets a course which we must now follow in the years to come.

Already in the last few years the number of premature deaths from major killers such as cancer and coronary heart disease have begun to fall dramatically in our country. New drugs and more effective prescribing have played their part in that. But there are new challenges too. The latest census for example showed that nearly 9 million people in England have a limiting long term illness. With the population of over-60s set to grow by one third in the next twenty years, that number will inevitably rise substantially.

At the other end of the age spectrum, rising levels of obesity, most worryingly amongst children, create future risks of diabetes, heart disease and of course renal failure. If current trends continue – and we need to see that they do not – up to a quarter of all adults in our country could be obese by the year 2010. And, of course, there are the threats posed to public health as a consequence of open borders, increased mobility and global travel.

New challenges then, demand new approaches. And here there are good reasons to be optimistic. Indeed, some commentators say we are likely to see in the next twenty years as much advance in healthcare as we have seen in the last two hundred. The pharmaceutical industry will undoubtedly be at the leading edge of these advances. Day by day the industry is helping us understand disease mechanisms better. And many believe this generation, our generation, stands on the threshold, fifty years after DNA was first decoded at Cambridge, of a genetics revolution that could transform health care across the world. Pharmocogenetics that tailor drug treatments to individual patient metabolisms. New drugs and therapies targeted at the cause of the disease rather than controlling its symptoms. Diagnostic methods that can help prevent disease before it develops. And gene therapies that hold out the prospect for entirely new treatments – and even cures – for cancer and other common diseases. I am delighted that Trevor Jones has agreed to chair the new Advisory Group for Genetics Research to provide the advice that we need to determine research priorities.

Because only if we make the decision to invest now will we harness this potential for the future. In a few weeks’ time I will publish a White Paper on genetics which will set out how we intend to work in partnership with the industry to put Britain at the forefront of this genetic revolution so that its advances can be made available to the people of our country.

And the benefits of scientific breakthrough and the great good that your industry brings need to be made available to poor nations just as well as to richer ones. No challenge can be greater than dealing with the threat to health posed by poverty and disease in the world’s poorest countries. John rightly mentioned the steps that pharmaceutical companies have already taken on this issue and I pay tribute to the work that you have done. It is true that governments and international organisations need to do much more too. But none of us can feel comfortable with a position where the industry develops medicines that can save lives, only for a minority of the people in the world who need them actually being able to benefit from them. It is precisely because of your achievement in creating new life-saving medicines that the world looks to you to do all in your power to make them available to the people who need them most. In Government we not only urge you to do that but we pledge to work in partnership with you to help make that happen.

In recent years we have built between us – industry and government – a strong partnership. It needs to be stronger still in the years to come if we are to meet the new challenges that confront us and realise the new opportunities that are open to us.

We are in an era of unparalleled growth in the NHS; a time of unequalled discovery in science and medicine; a period of profound potential in which both the UK’s health services and pharmaceutical industries can lay the foundations of better treatments for generations – in our own country and across the world.

To realise that potential however, we need to strengthen our partnership. We will then, I believe, truly unlock a rich seam of new science, new discoveries, new treatments and technologies which are genuinely capable of delivering better health and better lives in our own communities and communities across the globe.

This is the challenge for all of us. It is a challenge that I believe that by working together – Government, Industry and patients groups – we can meet that challenge.

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, to the National Association of Primary Care on 5 March 2003.

I want to begin by thanking the National Association of Primary Care for inviting me to speak but more importantly for being at the forefront of improvements in primary care and for speaking up for its interests.

Primary care is the frontline service of the National Health Service. Certainly, you are the people who make the health service work for millions of our fellow citizens every year. And from next month primary care organisations – PCTs – will be in charge of £46 billion a year – three-quarters of the total NHS budget.

So, today I believe we have an historic opportunity to put primary care where it should be: centre stage in a reformed National Health Service. In this speech I want to set out why it is necessary to achieve that renaissance in primary care and how we intend to make it happen.

The NHS today is the fastest growing health service of any major country in Europe. Six years ago resources were falling in real terms. Now they are set to double. In England, health spending has risen by 6.1% in real terms this year and will rise on average by 7.5% per year for the next five years.

The investment is going in to put the NHS on a sustainable footing for the long term. Quite simply if we want world class health care it has got to be paid for – if not through Pay As You Earn then through pay as you go. We have chosen on grounds of both equity and efficiency not to make people pay more for their own care when they are ill but instead to raise a little more in tax to get a whole lot more for the health service. A contribution from each of us to the health care of all of us. I believe that is the right decision for the country.

Some say resources never really produce results. In my view that is a counsel of despair and sometimes it is frankly motivated only by a desire to undermine the NHS and the people working in it.

Of course the NHS has problems. Decades of neglect and under investment are still felt in health centres and hospitals across the country. But steady progress is underway. Double the number of drugs are being prescribed to prevent heart attacks. 11% more prescriptions were issued last year and 13% more this year. One million more patients are getting a hospital operation every year. One and three quarter million more are getting seen in outpatients or in A and E every year. The number of patients waiting more than twelve months for an operation is down two-thirds. The maximum wait for a heart operation is being halved in just one year. Deaths from heart disease over the last few years are down 14%. Deaths from cancer down 6%. According to Professor Roger Boyle, the country has seen the largest fall in Europe in lung cancer amongst men and the largest decline in breast cancer amongst women.

In primary care there are particular challenges. In many parts of the country recruitment and retention remains difficult for example. But even here the “GP Golden Hello” scheme has contributed to the recruitment of over 2,200 new or returning GPs since it began in April 2001. The numbers of GPs in training has risen for 5 years in a row after previously falling for 5 years. New programmes, like the Flexible Careers Scheme and childcare support are helping more staff to achieve a balance between work and family life. For the first time since 1948 there is now a concerted programme to improve the quality of the working environment in primary care. Around 1,000 GP premises have already been modernised – well on the way to achieving the NHS Plan commitment to refurbish or replace up to 3,000 GP premises by the end of next year. There are extra resources being invested in the most under doctored areas. And alongside the investment, important reforms are already improving primary care for patients. The average waiting time to see a nurse in those practices involved in the Primary Care Collaborative is down by over 50%. The average time to see is a GP is down by more than 60%.

There is of course a huge amount of catching up to do and a long way to go. Notwithstanding some of the progress that is being made our primary care services face big problems. There are still too few GPs working in the NHS. Too many GPs and primary health care professionals have to work in poorly equipped premises. Too few GPs are able to spend enough time with their patients.

But the only way to address these problems – and to maintain the progress now being made – is to sustain the investment now going in. If people in the health service want to see progress then that requires money. That is why in my view it is right that the Government has taken the decision to add 1p to the tax bill so get the right level of resources and the right programme of reform into the health service.

I know there is a feeling in primary care that it does not get its fair share or that it always loses out. Sometimes in government we may have given the impression that it is always hospitals that come first, primary care services that must inevitably be second. I think that impression is wrong and today I want to tell you why that is and what we intend to do about it.

I know that over the years every secretary of state for healthSecretary of State for Health has said they want to shift the emphasis of where health care is provided from hospitals to primary care. I know too that primary care audiences generally respond with a few seconds of hope, a few minutes of scepticism and then years of disappointment. I believe however that this generation has the best opportunity there has ever been to put primary care centre stage in a reformed NHS.

I say that for a number of reasons.

Firstly, because patients are on the side of primary care. Primary care – despite the very real problems it faces – is the jewel in the crown of Britain’s NHS. It is where we lead the world. Other nations with supposedly superior health care systems look on our family doctor system with envy: admiring it for its better outcomes, lower costs and higher satisfaction levels.

Primary care makes a difference to one million patients every single working day. Nine out of every ten NHS patients are seen in primary care. And three quarters of patients are quite or very satisfied with the work their GP does for them.

And primary care is set to become even more important. It will play an even more pivotal role as we expand the choices available to NHS patients. For years the role of GPs has been described as a gateway into the health care system but as patients begin to exercise greater choice within the NHS, the role of family doctors, community nurses and other primary care staff will become increasingly important to help patients make informed choices about their care.

Second, demographic change is on the side of primary care. The latest census showed that 18% of our population, nearly 9m people, have a limiting long-term illness such as chronic obstructive pulmonary disease, diabetes or arthritis. In some areas of the country this affects nearly one third of the population. The challenge of chronic disease is set to grow rather than diminish over the years to come.

Modern medicine is increasingly converting previously life threatening conditions into chronic conditions. Nearly three quarters of older people suffer from one or more long-standing illness. The number of people in the UK over 60 is projected to grow by one third by 2021; the number over 75 by more than one quarter.

At the other end of the age spectrum rising levels of obesity, most worryingly amongst children, create future risks of diabetes, heart disease and renal failure. According to research the Department of Health has undertaken into likely future trends in health care – and which I intend to publish before too long – if current trends continue up to one quarter of adults are likely to be obese by 2010.

Those with chronic conditions, especially the elderly and frail, need to receive care as close to home as possible. That calls for greater emphasis on expanding primary care services so that they can work more effectively in partnership with patients.

Third, medical advance and technological change are also on the side of primary care. Future technological change – near patient testing, digital imaging, telemedicine – together with new treatments and prevention strategies will all support an expanding role for primary care in taking a lead in the management of chronic disease.

For example, within the next decade it is likely that the miniaturisation of diagnostic and monitoring equipment will enable diagnostic kit to be available in primary care; intensive treatment will become available on standard hospital wards and even in the home; and there will be more widespread use of self-monitoring at home.

The trend in treatment is therefore towards it being delivered locally. Indeed in this era of globalisation that is what people increasingly want to see.

Public expectations. Changing patterns of health need. New treatments and technologies. The tide of history is flowing firmly on the side of primary care.

The government’s reform programme goes with this tide of change. As both the proposed new GP contract and the creation of Primary Care Trusts testify our reform programme too is on the side of primary care.

Let me take each in turn.

First the proposed new GMS contract. If it is accepted by the profession, I believe it could mark a turning point in the history of primary care.

I want to use this opportunity to say publicly what I have already said privately to the negotiators. Both the NHS Confederation and the BMA are to be congratulated on the agreement they have reached. The most ambitious quality based incentive scheme for primary care in the world. I hope very much that it is endorsed by the profession. Of course, I fully recognise that implementing this is going to be a major challenge for the NHS. But, difficult as it is, it is the right thing to do.

I say that because the contract will help GPs better manage workload, in particular the burden of out-of-hours care. It will support the desire I know many practices have to deliver a greater range of new and innovative services particularly at the primary to secondary care interface. And it recognises the independent practice unit as the cornerstone of primary care which should enjoy greater devolution of responsibility and greater freedom.

Where these developments help PMS doctors, we will look to incorporate them into the PMS arrangements. As I have said before, PMS is here to stay. We want to ensure that all patients have access to high quality services, whether their doctors are PMS doctors or GMS doctors, and we want to ensure that NHS resources are allocated equitably on the basis of the needs of patients and of practice populations.

The contract will bring an unprecedented 33% increase in new investment in primary care. That should allow those practices that want to, to achieve a step change in the range, quality and accessibility of primary care services.

Primary Care Trusts will help realise that objective too. From April, PCTs will be in charge of three-quarters of the NHS budget. PCTs exist for two main purposes: to hold the resources and the responsibilities to improve the health of the local population and to commission care which gives local patients the services that are right to meet their needs.

I have often heard it said this is all very well in theory but in practice the resources are already spoken for with hospitals that drain all the investment and primary care that inevitably loses out.

I want to take that argument on today – and to set out how, by working together, we can ensure that more not fewer services are provided in primary care and that PCTs are able to exercise real power.

To begin with, the resources we have allocated direct to local primary care trusts are for three years not one. The average increase is over 30%. This should allow PCTs to plan with certainty to increase capacity over the medium term. In the past short term funding hindered long term planning. Now PCTs are able to decide which local developments will take place when. And three year budgets should allow PCTs to decide longer term agreements with hospitals and with other providers.

We have also given PCTs the explicit freedom to purchase care from the most appropriate provider – whether public, private, voluntary or not for profit. Resources will follow the choices that patients and PCTs make so that hospitals which do more get more; those which do not, will not.

And we want to help PCTs develop this commissioning role. At present I know that when it comes to negotiating contracts it can feel like the hospitals hold all the cards. But remember this – PCTs hold all the money. And we want to create a more level playing field.

We are planning to build up PCTs’ capacity to commission first through the national PCT development programme, then through the new NHS University. I want the NAPC to be part of this process – so that every PCT in every part of the country has the information, the skills and the resources to get the best deal for patients. In some parts of the country PCTs are already drawing on the strengths of organisations such as Kaiser Permanente and United Healthcare from the USA to help them deliver improvements in commissioning of services. In the months to come we will want to find ways of more PCTs benefiting from such an approach. And I can tell this conference that we are already exploring how the concept of earned autonomy can be applied to PCTs so that those who are performing best get more freedoms and those that need more help get greater support. And the concept should not stop there. I will be looking at how Practices should benefit from earned autonomy as relationships with PCTs develop and the new GMS contract beds in.

Our ambition has to be put primary care centre stage across the whole health service. For example, as w0e move over a four or five year period towards all hospitals having the opportunity to become NHS Foundation hospitals, PCTs throughout the country for the first time will be represented on hospital governance structures. That will put primary care even more in the driving seat.

And when we start to introduce from next month a common tariff system for hospital operations it will take out of the local negotiations between PCTs and hospitals the very areas where PCTs are weakest – on price negotiation – and leave those where they are strongest – on quality of service and outcomes of care. PCTs need their local hospitals – but not at any price. Hospitals need to deliver – and PCTs need to demand the right standards of services.

So I will stand up for PCTs. And PCTs need to stand up for themselves. I know that many feel honour bound to the local hospital. But the job of PCTs is to get the right services for patients. They need to flex their financial muscles and use their commissioning powers.

The truth is that delivering shorter waiting times in hospitals – whether in A&E or for a hospital operation – cannot simply be delivered by more activity in hospitals. It requires more intermediate care services, more social care services, more primary care. It needs more help so that people can avoid hospital by being treated in the community. That calls for more diagnostic and outpatient clinics in health centres. Better facilities to enable GPs who want to, to carry out more diagnostic services and more day surgery. It needs more locally based services so that those people who do need hospital treatment can return home when they are ready to do so. It needs a greater emphasis on prevention and not just treatment. A bigger role for self care. Better use of pharmacist skills. More walk in centres and community hospital services to build a bridge between the big acute hospital and the patient’s home.

Some PCTs are already grasping these opportunities. Many more can now do so. I believe that taken together, the potential of the proposed GP contract and power in the hands of PCTs, provide a once-in-a-lifetime opportunity to rebalance services in the NHS – between those provided in hospitals and those in the community. Of course hospitals will continue to be important – not least because long waits for treatment both corrode public confidence and frustrate GPs. But a better balance is required. Indeed the hospital won’t be able to do its work and we won’t be able to get hospital waiting times down unless the balance shifts towards primary and community services.

Take outpatients. Over these next few years we estimate that as many as one million outpatients could be treated in primary and community settings rather than in hospitals. That will ease the pressure on hospitals, provide care more conveniently for patients and enhance and expand the role of primary care.

That is dependent of course on expanding the capacity of primary care. The new GP contract and the new Agenda for Change pay system will be important means to that end.

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

And to help that process and to build on the Implementation Framework for GPs with a special interest we published last year, I can tell this conference that later this month we will publish ten further draft guidelines – we have developed with the Royal College of GPs and others – for accrediting GPs with a special interest in areas such as dermatology, diabetes, orthopaedics and neurology. At the same time we will also publish a similar Implementation Framework for Nurses in specialist roles to advise and encourage nurses and PCTs in establishing specialist roles.

We will also want to encourage more PCTs to follow the lead of those in places like Dudley, Milton Keynes, Salford and Southend-on-Sea which all employ consultants in specialities such as mental health and paediatrics. This is about securing greater integration in services. It is about overcoming the divide between primary and secondary based care. Most importantly of all it is about making services more locally accessible to patients. I hope that – consistent of course with appointments being properly regulated – PCTs will now consider how to extend these employment opportunities for consultants to surgical and other specialties.

In these next few years – with funding on a sustainable footing for the longer term – PCTs have a huge opportunity to reshape local services in the interests of local patients. If PCTs properly use the power and resources they now have, they will be central to bringing about a renaissance in primary care.

The future of the NHS lies in primary care. That is where patients want to be treated. It is where medical advance is moving treatment. And it is where both the profession and the government want to see prevention and treatment expand.

I believe we really do stand on the threshold of that renaissance in primary care. With the right level of investment, the right reforms, the good will of the profession and the support of the whole health community, we can secure a major change in the focus of health care in our country.

You are central to that.

For years primary care has dealt with most NHS patients.

From this year primary care will control most NHS resources.

From now on, primary care must drive investment and reform across the whole health service.

You have the power; you will have the resources; you now have the opportunity to change the system in the interests of the patients you serve.

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 5 February 2003.

I would like to thank the New Local Government Network and the New Health Network for hosting today’s event. They are at the forefront of new thinking around public service reform and debates about what should rightly be done centrally and what locally. It is an important indication of where that debate is going that they have jointly hosted today’s discussion.

This speech is the first of two speeches I will be making over the next week on the theme of public service reform. My speech next week will focus on choice in public services. Today I want to cover the importance of local accountability and local control in public services.

The context is this. Any government succeeds or fails according to two simple tests. One whether it has a coherent vision for the country. Two, whether it can make progress towards realising that vision: whether the country is moving forwards or backwards.

We are now at a critical juncture for this Labour government. We have been in power for almost six years. Labour dominates the political landscape in a way quite unimaginable even a decade ago. The Conservatives are weak, divided, uncertain. And yet the decisions we take on reform now will determine the course of politics not just for the remainder of this Parliament but I believe for the remainder of this decade.

Of course the decisions we make in relation to Iraq and the Euro are hugely important. They will leave their mark for years to come. But it will be the bread and butter issues on the economy and public services that will shape public views.

Here we need to chart a clear course, both in setting our vision and in making progress towards it. On both counts we face a choice. In essence it comes down to this: to consolidate around what we have done to date, to pursue the cautious incrementalism that sometimes characterised our first term in office. Or to discover new momentum towards a more fundamental and radical transformation of our country. It is the latter course I believe we must choose.

Today I want to set out how we can transform public services in our country. And in so doing I want to make the case for what I will call ‘Real Localism’.

The Government has made public services the key political battleground in our country. We have staked our reputation on being able to deliver the improvements in public services that have escaped governments for decades. And we have embarked on a high risk but necessary strategy of putting up taxes in order to raise resources for the health service and other key public services.

We have been right to do so. But we need to recognise that we have massively raised the stakes. Collective provision of public services – whether in health, education or local government – is under threat as never before.

The Right – in the media and in politics – believe the game’s up for services that are collectively funded and provided. In today’s consumer world they argue that the only way to get services that are responsive to individual needs is through the market mechanism of patients paying for their treatment.

It is easy to dismiss the Right’s policies as the last twitch of the Thatcherite corpse. But if we fail to match high and sustained investment with real and radical reform it will be the Centre-Left’s argument that public services can both be modern and fair, consumer-orientated and collectively provided that will face extinction.

I believe that we can win the argument for public service investment and reform but to do so we have to accept that the era of one-size-fits-all public services is over and that the Centre-Left’s approach today should be based on decentralisation, diversity and choice.

We can win this argument for three reasons.

Firstly, in this era of globalisation public services are necessary to provide security, foster inclusion and promote prosperity. People today feel more insecure than ever. This can be a reflection of their own economic circumstances or a recognition that there are new and powerful forces at play – economic, social, cultural – which affect every developed country and impact on all our lives.

Greater economic uncertainty is inherent in globalisation. Crime, terrorism and international tensions have heightened this sense of personal and national insecurity.

Global insecurity makes the case for social and economic institutions which strengthen aspects of personal security. In this climate, strong values-based institutions which reinforce people’s sense of community become more rather than less important. The NHS is just such an institution.

And in any case, medical advance and technological change is making the NHS more, not less, relevant. When health care can do more but costs more, where no-one knows when or whether they may become ill, a National Health Service providing services for free, based on need not ability to pay, can provide a rock of stability in an otherwise uncertain world.

Secondly, we can win the argument because the NHS is now making progress. It has 40,000 more nurses and 10,000 more doctors. For the first time in four decades over two consecutive years the number of general and acute beds has risen. The number of patients waiting over 12 months for NHS treatment is down 59%. A year ago the maximum wait for a heart operation was 18 months. Today it is 12 months. By April it will be 9 months. Over 95% of patients with suspected cancer are now seen within two weeks by a specialist when many used to have to wait months.

In the last few years death rates for cancer have fallen by 6% and for heart disease by 14%. The latest reports show the survival rate for the most common forms of childhood cancer now rank amongst the best in the world.

There is still a long way to go. But the momentum is forwards not backwards. Of course, the Right’s strategy – having starved the NHS of resources for decades – is to deny that the NHS can ever translate extra resources into results for patients.

But the fact is the money is working. Since 1997, one million more patients are being admitted to hospital for an operation. A further one and three quarter million patients are being seen as outpatients or in A and E. The number of prescriptions by GPs rose by 11% last year and is up 13% this year. Prescribing of cholesterol-lowering drugs – which prevent heart attack- has doubled in the last few years. And for the record, whilst hospital bed numbers are rising management costs are falling.

The third reason for my optimism is that the investment is committed for the long term. The NHS is assured of high and sustained levels of resources up to 2008. And, after decades of stop-go and short-termism, we have a ten year NHS Plan of reform to match the high levels of resources.

The NHS will not make progress unless the two go together. Reform is too often characterised by its enemies as an attempt to undermine NHS values. But this confuses ends with means. Labour’s reform programme is all about preserving NHS values by changing NHS structures. The ends – care for free based on need not ability to pay – remain. The means – a one-size-fits-all nationalised industry monopoly approach – must change.

There are four principal reasons for that.

First, the uncertainty engendered by globalisation is driving people to take refuge in what they know – in their families, their communities, their regions. People find shelter in the very local because the local can be influenced even if the global can not.

The way politics is structured needs to reflect that yearning for local control. In this country the advent of locally elected mayors, renewal of local government and, I hope and believe, the birth of regional government will give life to localism. Public services too, in the way they are structured need to reflect the growing public desire to control what they know.

Second, for all its great strengths – its staff, its public service ethos, the great advances it has brought in public health – the NHS has a profound weakness too. It took power away from local communities and vested it in the central State. Of course, this brought huge benefits but at a real cost. A gulf grew up between local communities and the running of local services. Today we must find a way to bridge that gulf.

Ours is a small country with big differences. It is not uniform. It is multi-faceted and multi-cultural. Different communities have different needs. With the best will in the world, those needs cannot be met from a distant Whitehall. They can only be properly met locally not nationally.

Third, health services are delivered locally not nationally by over one million expert staff whose principled motivation and ethos of service private sector organisations can only gaze at with envy. The NHS is a high trust organisation. It needs to be organised in such a way that trust can be enshrined at every level; trusting people to innovate and take initiative for themselves. In the end I don’t treat patients. Whitehall doesn’t provide care. That is what hospitals, health centres and surgeries do. And that is where power needs to be located. On the frontline. The simple truth is the NHS works best when it harnesses the commitment and know-how of staff to improve care for patients.

Fourth, ours is the informed and inquiring world. Universal education and now the internet are redistributing knowledge. In a consumer society more people are demanding public services that are responsive to their own needs and offer greater personal choice. This is a long way from the one-size-fits-all, take-it-or-leave-it public services that were the product of the 1940s. Then expectations were lower, deference was greater. Now it is the other way round. Sustaining public confidence in public services means they need to dance to the tune of the consumer.

Together, the push to the local and the pull of the consumer call for a new model of public services. One where patients and parents have greater choices over the services they use and where communities have greater control over how they are provided.

The new political battleground then, is around the politics of localism. The Right desperately want to claim this ground. In the process they will want to paint Labour as the Party of the centralised, out-of-touch State; the Party of Government-knows-best rather than consumer choice; the Party of old style, monolithic, unresponsive public services.

We pick up this mantle at our peril. And yet for reasons of history – both ancient and modern – Labour could easily have it laid upon us. At the end of the Second World War it was Labour that created big national institutions to tackle the country’s big national problems. Whilst across Europe other Socialist and Social Democratic Parties were championing community involvement and ownership – and indeed Left thinkers such as GDH Cole, RH Tawney and others from the mutualist tradition were advocating a similar approach here – in Britain we ended up with too a close an affinity between State ownership and public ownership.

Whilst the British post-War welfare settlement assured all our citizens of universal provision – particularly in health – it defined equality as uniformity in provision. It was easy to be convinced that by securing one we had inevitably secured the other. But just as communities are different, health needs are different too.

Uniformity of provision has not guaranteed equality of outcomes. Indeed health inequalities in the five decades since the NHS was founded have widened not narrowed. Too often even today the poorest services are still in the poorest communities.

The case for localism over uniformity is about shaping services more effectively to tackle health inequalities in our society every bit as much as it is about shaping them to be responsive to the concerns of the individual.

In our first term Labour’s approach was to try to do that from the top down through a plethora of service targets, inspection regimes and national standards. There is little doubt that many of these were needed to counter the effects of two decades where the Tories had fragmented services and, in the NHS, delivered a lottery in care.

And for all the concern about targets no-one should kid themselves that we would be making the progress we now are without the targets that we set then. Waiting times for treatment – which had been rising for decades – are now falling on virtually every indicator because targets focussed the health service on what is the principal cause of public concern about the NHS. Standards of reading and maths in primary schools are rising because teachers and parents now support the literacy and numeracy hours timetabled every day in every school.

Arguably it should not have needed Whitehall to focus our health and education services on these key objectives. But a monopoly public service can all too easily become ossified and immune, if not resistant, to public concerns. External pressure from above therefore, can be an important means of focussing efforts to address public concerns. So can the pressure brought by individual patients exercising choice and by enhanced forms of local accountability. In the next period the emphasis needs to move from top down pressure to these more direct forms of engagement between those providing public services and those using them.

Targets work best when they are properly focussed. Which is the reason, incidentally, why the Priorities and Planning Framework we issued late last year to local health and social services contained not 400 targets as some claim but just 60 or so for the next three years.

National standards are necessary to ensure equity. No-one who is serious about securing fairness wants to go back to the days when cancer treatments, for example, were available in one part of the country but not in another. So targets can work but targets can go too far as well.

Targets fail when there are too many of them and when they inhibit the ability of local staff to shape local services to meet local needs. Disempowering frontline staff – whether it is doctors or nurses, social workers or police officers, teachers or managers- is not the best way to run a public service. It is right to set standards nationally but it is wrong to try to run the NHS nationally.

Those of us who have had responsibility for frontline public services over the last six years realise that whatever we thought possible on the 1st May 1997 – however much we believed that taking control of the commanding heights of the central state was enough – we now know that finger-wagging from Whitehall can not deliver public service improvement any more than could the old laissez-faire mentality of the Tories’ NHS internal market.

A better balance is needed. Whereas, some suggest there is a choice to be made between national standards and local autonomy I believe that is a false dichotomy. The experience from elsewhere in Europe in the health sector and from across the developed world in other economic sectors is that securing improvements in performance requires both.

As the Prime Minister’s four principles of public service reform rightly acknowledge, in any large organisation – public or private – there are some functions only the centre can perform: fair allocation of resources; setting of standards; monitoring of performance.

And it is precisely because we have a framework of national standards and inspection in place that the pendulum can now swing decisively towards local control and greater individual patient choice. I believe these must become the principal drivers of public service improvement in the next period.

We are now in transition from the old order to the new. As we set out in the NHS Plan the more performance improves the more control local health services will assume. Rather than trying to drive improvements simply through top-down performance management, the transition will be towards improvements being driven through greater local autonomy in which PCT commissioning, new financial incentives and the choices patients make become the driving force for change, backed by scrutiny through independent inspection. That transition will take time. It will require careful management and a new, more mature understanding about the relationship between government and the health service, where the government does less and the NHS does more.

That transition has now begun across the public services. In local government the White Paper produced by Stephen Byers represented a turning point in the relationship between central government and local councils with the prospect of more freedoms, flexibilities and powers. The Deputy Prime Minister John Prescott is now taking this further. Similarly, in the health service from this April, three-quarters of the total NHS budget will be controlled by locally run PCTs with three year budgets. In turn PCTs will be able to devolve resources to their constituent practices. None of the 30% growth PCTS are on average receiving has been earmarked. They will be free to commission services from the public, private or voluntary sectors.

So we have been moving from a centralised command and control model to what has been called new localism. The issue is now whether we can make this localism real and permanent. Whether we can go beyond a relationship where localities receive a few crumbs of decentralisation from the top table of central government and are expected to be grateful. Or whether we can make localism irreversible through a shift in accountabilities, ownership and control out of the hands of the central state and into the hands of local communities. This is what I mean by real localism.

I believe we have the opportunity to transform governance in our country. To do so requires grasping some thorny nettles of reform.

It means placing limits on the role of Whitehall. We could do that through exhortations to good behaviour on the part of Ministers and civil servants. We could be much clearer about what the role of the centre of government is about; what the role of the individual government department is about; and what, together, is the best role for Whitehall to play. All of these, in my view, are needed. Some have already begun. But I do not believe they will be enough.

Central bureaucracies make work. They make demands. Politicians – for good reasons, not bad – want to get their hands dirty. We want to pull levers to make changes happen. And that places further pressure on local services. It is naive to believe that a self-denying ordinance in Whitehall will be sufficient.

If we want to place limits on the role of Whitehall we will need limits on the size of Whitehall. The time is right in my view for a fundamental re-assessment of what functions Whitehall needs to perform in an era where the premium is now not just on making policy but on securing delivery. Where there is an acceptance that securing improvements in public services requires a re-balancing between the power held by central government and the power held by local communities.

The nature of Britain’s unwritten constitution means all governments have experienced tensions between competing centres of power. It is not a new phenomenon. Throughout time, there has been a struggle for power within the British constitution: between barons and Monarchs; between the Church and the State; between the rights of Parliament and the Divine Right of Kings.

It can be seen in the continuing struggles over powers between the House of Commons and the House of Lords – where history seems determined to repeat itself, as Marx once said, “first as tragedy and then as farce”. And in the context of last night that is Karl Marx not Groucho.

And on the issue of Lords reform let me just say: surely the priority should be to address the imbalance between the centre, the region and the local rather than just concentrating on the balance between the Commons and Lords. Getting that balance right – through greater devolution – could then, in my view, be reflected in a reformed second chamber constituted from the different nations and regions of our country.

Today competing tensions exist in a more modern context but they exist nonetheless. Those tensions exist between Europe and the Nation State; between government from Westminster and Whitehall and devolved administrations in Scotland, Wales and Northern Ireland; between the decisions of Parliament and the interpretations of judges; between power best exercised from the centre and that best exercised by local communities themselves.

For all the reasons I have set out the days of Whitehall – or any one part of Whitehall – knowing best are over.

My argument is not that Government itself is bad – that is not true. Government has an important role determining policies and priorities, setting and monitoring standards, raising finance, ensuring value for money, assuring equality of access and opportunity. The alternative to government – or its proxy – doing these things is to leave them to the invisible hand of the free market, which as Gordon Brown was rightly saying only on Monday, is often an insufficiently effective mechanism for so doing.

My argument is that government at the centre has to be big enough to perform its function but limited enough to curtail its ambitions. All bureaucracies have a natural tendency to grow, to replicate themselves. With the Crown prerogative and an unwritten constitution, we have no basic law setting out the roles and responsibilities of governments at local, regional and national levels, no constitutional court, no real fetters on the power of central government to accrue powers to itself save those exercised through Parliament and Judicial Review.

In these circumstances, it is for those who believe in progressive reform of public services to ensure real power shifts from Whitehall to local communities. And power moves when ownership transfers.

This involves a fundamental change in governance. The centre will always be strengthened and the locality weakened so long as the one has the mandate of democratic accountability and the other does not. That is why I believe NHS Foundation Trusts are so important. They are not about relinquishing a little central control. They are about relocating ownership out of the hands of a State bureaucracy and into the hands of the local community.

In the process they relocate accountability – so that hospitals can look outwards to the communities they serve not upwards to Whitehall. That will help get local health services better focussed on meeting local needs and addressing local inequalities.

NHS Foundation Trusts will usher in a new era of public ownership. They will be owned and controlled locally not nationally. Modelled on co-operative societies and mutual organisations, these NHS Foundation Trusts will have as their members local people, local members of staff and those representing key organisations such as the PCTs. These members will be its legal owners and they will elect the hospital governors. In place of central state ownership there will be for the first time in the NHS genuine local public ownership.

It is not and it has never been my intention to retain these benefits solely for an elite few. The freedoms they offer provide a new incentive for all to improve. We do not advocate that any NHS hospital should be left to sink or swim. That is why we have put in place help and support for struggling services to get better. In time, all NHS hospitals could gain Foundation status.

I believe NHS Foundation hospitals will help bridge the gap between public services and the public who use them. With a clear public benefit purpose NHS Foundation Trusts can provide a model of local control and ownership that others could follow. They are localism made real. I believe they provide a model that could apply to other aspects of public services.

Community-owned NHS Foundation hospitals will allow us to tap the great reservoir of enterprise and knowledge which exists in local communities. Some say that allowing local people to be elected to hospital governing boards will always favour the sharp-elbowed middle classes. Yet in my constituency – just like any other – the people who make the biggest difference on local council estates are people from those council estates. What we need to do is open up public services in such a way that they can be properly representative of the communities they serve.

For example, where New Deal for Community boards have been set up to oversee regeneration in some of the poorest parts of our country turnout in the board elections has been much higher – in some cases double – the turnout for the local council elections.

Democracy is by no means perfect in practice but it is not a bad principle. Transferring ownership from the central state to local communities – giving local people a stake and a vote in the public services they use – is the best way of moving localism beyond a gift conferred by Whitehall – which can be taken away by Whitehall – into a permanent feature of our democratic landscape.

The implications of this approach are potentially far-reaching. In other countries with a stronger democratic input into local services, for example, local communities are able, through referenda or through local elections to agree to raise local funds to invest in the public service infrastructure. In the USA local bond issues are common. Some are issued by a local government authority which then lends the proceeds to the local hospital. Others are sanctioned by voters and issued by the hospital district direct. In this way, these health care systems can overcome the constraints either of central government capital rationing or the straitjacket of particular forms of procurement.

And in the context of our new approach to localism in this country there is already discussion of these issues here.

Alongside self-government in Scotland and Wales and the plans for regional government that John Prescott is leading in England, I believe that such devolution and democratisation of public services can point the way to a more pluralist and decentralised Britain.

The ramifications are profound. Where there is greater local control – as the Prime Minister, Chancellor and myself have all argued – there will inevitably be greater diversity. The one flows from the other. I think that is right. The NHS cannot survive as a monolithic top down centralised system. Without greater diversity the NHS cannot be more responsive. Without responsiveness there cannot be public confidence. Without public confidence the NHS will not be sustainable.

Despite fifty years of hard evidence that uniformity has not produced equality, the traditional fear on the Left has been that diversity must bring inequality. But it is worth recalling what R.H.Tawney wrote in his 1931 book Equality:

“equality of provision is not identity of provision. It is to be achieved not by treating different needs in the same way, but by devoting equal care to ensuring that they are met in the different ways most appropriate to them, as is done by a doctor who prescribes different regimens to different constitutions, or a teacher who develops different types of intelligence by different curricula. The more anxiously, indeed, a society endeavours to secure equality of consideration for all its members, the greater will be the differentiation of treatment which, once their common needs have been met, it accords to the special needs of different groups and individuals amongst them.”

Diversity, in other words, can bolster the pursuit of equality rather than undermine it.

The evidence from the specialist school programme shows that diversity and choice of provision delivers a real return not least in poorer communities. Specialist schools recruit on a broadly comparable basis to non-specialist schools in terms of deprivation and test results at age 11. Yet GCSE performance in specialist schools was six percentage points higher than in non-specialist schools – 55 per cent to 49 per cent, in terms of those gaining five or more good passes. Research also shows that the longer schools remain in the programme, the higher the rate of improvement. And on recent measures of value added performance – which allow comparisons to be made between schools with different intakes – specialist schools outperform non-specialist schools.

Diversity is not a stranger to other left-leaning countries. Whereas in the UK’s health care system there is uniformity of ownership, in many other European countries there are many not-for profit, voluntary, church or charity-run hospitals all providing care within the public health care system. There are private sector organisations doing the same. As other European nations testify there is no automatic correlation that tax-funded health care has to mean health care supply run purely by central government. That is why I believe tax funded health care in our own country can sit side by side with decentralisation, diversity and choice.

Labour’s objectives – social justice and opportunity for all – remain our mission. Our means of delivery however, must now change. We can preserve values and yet still change structures. We recognised this when we got rid of the old Clause 4 from our Party’s constitution. We did not change the values in which we believed but we renewed our Party’s appeal as a result. We now need to end the old Clause 4 approach to public service delivery. We must not abandon the values and ethos of public service but – through local control and ownership, diversity and choice – we must now reconnect public services directly to the public that they serve.

The relationship between citizens and public services in this 21st Century should be based on principles of decentralisation and empowerment. In health, in education, in housing, in local government and elsewhere we need to decentralise and empower staff and citizens alike. We must decentralise from the nation to the region. From Whitehall to the town hall. We must decentralise from local councils to local schools and to local housing estates. And in the NHS we must give communities more voice as well as giving patients more choice.

These are the building blocks of real localism. The challenge to government is not whether Ministers can use the rhetoric of locality but whether we are now all prepared to live – and govern – with the reality of localism. I believe we should.

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, on 27 November 2002.

I wanted to come along for a couple of reasons. First, there are many of you here from a variety of backgrounds and I want to thank you for what you are doing. I want you to thank the people who are working in emergency care when you return to your various hospitals, community centres and so on. Much of the discussion today inevitably centres on the problems that we have in the emergency care system. But I think it is quite important that we also recognise that most people get very high quality care most of the time. That is down to you, and the people that work with you and for you in the community.

I was recently travelling back from a conference with a television news presenter, who had recently taken his elderly relative to an A&E department in London. He compared it to his last visit two years before, and he was struck by how quickly his relative was seen and how there was very clear communication from the outset through each stage of the patient’s journey. He knew what was going to happen next and that was important for him. This was in marked contrast from his previous experience.

He did not know anything about Emergency Care Collaboratives or streaming, but he did feel their consequences. What he extrapolated from the experience was the state of the NHS. And this is why emergency care is so critical. Obviously, it is important in itself. But it is also an important barometer for the public for the whole of the NHS. The quality of the A&E experience has an impact on what people think of the whole healthcare system.

There are huge problems, and we all know that. But I think we have a real opportunity to change things for the better. There is more money going into the NHS. We are going to get five years of real-term increases in funding, worth around 7.5%. We have a unique opportunity to use that money to provide the quality of care that patients want to see. We need to get the money into the right places – into A&E – but that is not just hospitals. Primary care, community services and social services must work too.

If you are putting taxes up, which we are, people will want to see a return for the extra they are paying. The Emergency Care Strategy has set out a national framework for the way these improvements can happen. We have strong leadership in David Lammy and Sir George Alberti. There is a huge amount of change happening even though people are not always comfortable in managing and experiencing change.

When I see the fact that 20% of our A&E departments are now providing 90% of our patients with care within four hours that fills me with optimism. In the end, even though we can have as many national standards and targets as we like, there is a big difference between “us” on the platform and “you” out there. I do not treat anybody – you do. Nothing will happen without your involvement and your support. The real reason to be hopeful is that when you visit an A&E department, NHS Direct or anywhere, you are filled with a sense of amazement and privilege about what people are doing.

I have always believed in one simple thing: if you can put together the right level of investment, the right programme of change and reform, and you can harness the expertise, commitment and know-how of staff out there, then you can change things for the better.

There are a lot of problems in the NHS. But I believe one fundamental thing about it: we live in a world where healthcare can do more than it has ever done before, but it costs more than it has ever done before. In that world, I think NHS values and principles – care being free and based on a person’s need and not their wealth – is not a weakness for Britain, but an enormous source of strength for Britain.

So, I think we have a unique opportunity. We look to work with you, and to learn from you, to make these changes happen. I believe we have every reason indeed to be very optimistic about what the future holds for emergency care and our health system overall. Thank you very much for coming.

Below is the text of the speech made by Alan Milburn, the then Secretary of State for Health, to the CBI Conference in Manchester on 26 November 2002.

Thank you for the opportunity to take part in your conference.

As I have stressed in recent meetings with both Sir John Egan and Digby Jones the Government attaches particular importance to the relationship we have with the business community.

I am pleased to be able to put on record my thanks to the CBI for agreeing to work closely with the Department of Health on a number of specific projects. First of all on improving procurement so that public and private sectors alike are able to make the most from the record investment now going into renewing our key public services, especially the NHS. And secondly, encouraging mentoring, secondment and management support to the NHS from within the business community. By working together we plan to open up the NHS to new management talent from outside the health service to help meet some of the new management challenges we face – in areas like IT, procurement and programme management.

More generally we recognise as a government the pivotal role public private partnerships are playing in improving our vital public services. I very much welcome the statement launched today by the CBI on the role of PPPs. There is much in it with which we can agree. In essence the Government’s approach is about using the private sector where it can support the public sector to improve public services.

You can see that with the private finance initiative. PFI is a partnership that works. As an addition, not an alternative to public sector capital investment, PFI is helping deliver the biggest new hospital building programme the NHS has ever seen. It is allowing more new NHS buildings to be built more quickly. PFI is here – and it is here to stay.

In the face of sometimes fierce, often dogmatic opposition to PFI, both public and private sectors have a responsibility to explain that this is a partnership that is delivering results for patients and good value for money for taxpayers. We have a shared interest in doing so because we have a shared interest in making sure public services work. Public services are vital to business, the economy and the wider society we serve.

That is as true for health as it is for education or transport. At its simplest, the level of ill health in our country means a loss of productivity and a loss of potential skills that an increasingly knowledge-based economy simply cannot afford.

I believe that in a world where health care can do more but costs more an NHS free at the point of use based on need not ability to pay is a huge strength for Britain. So the values of the NHS are right. But for all its great strengths – its ethos, its staff, the great advances it has brought in public health – the NHS has profound weaknesses too. Too often the poorest services are in the poorest communities. Its centralised top down structure tends to inhibit local innovation. Staff too often feel disempowered. Local communities feel disengaged. And patients have little say and precious little choice.

The NHS needs two things. One, investment. Two, reform.

Improving the NHS requires us to address decades of under-investment. There is a simple truth here: if we want world class health care it has got to be paid for. The last Budget sought to do just that. Five years of real terms growth averaging 7.5% will take health spending in our country beyond the EU average. We have a lot of catching up to do but today we have the fastest growing health care system of any major country in Europe.

When we put taxes up to pay for more resources for the NHS we entered into a new contract with the people of our country. In exchange for extra resources we need to deliver better results. That means a tough new inspectorate to guarantee value for money for taxpayers and the highest clinical standards for patients. It means modernisation of how the NHS pays and employs staff. And it means, as we set out, in our 10 year NHS Plan far reaching reforms. Devolution of power. Diversity of provision. Choice for the consumer. Each is controversial, but all are needed if we are to get the best from the resources we are putting in.

Let’s start with devolution. The job of government is to set standards and objectives to ensure equity in healthcare provision. It is not to run the NHS. A million strong service cannot be run from Whitehall. It’s got to be run by the local staff and held to account by the local community.

As in any large organisation – public or private – getting the right balance between national and local holds the key to securing improvements in services. In the NHS today we are at the start of a transition where we move from a top down and centralised system to one where standards are national but control is local. So the performance of local health services is now being rated with those doing less well getting more help and those doing best getting more freedom. At one end of the spectrum new management teams will be brought in – from the public, private or voluntary sectors – to turn round persistently poor performance. At the other the best performers will become NHS Foundation Trusts freed from Whitehall direction and control, governed, indeed owned by the local community and with a bigger say for local staff. Reform means investing not just extra resources in front line services, but power and trust in those front line services.

From next April locally run primary care trusts will control three quarters of all NHS resources. They will have the freedom to purchase care from the most appropriate provider – public, private, voluntary or not for profit. This will bring greater plurality in local services with the freedom to innovate and respond to patient needs. So in addition to sustained growth in existing NHS provision and greater use of existing UK private sector hospitals to treat NHS patients, we will bring new private sector providers from overseas into this country to further expand NHS services. As other European nations show, a public health care system based on centre-left values does not need to be exclusively delivered by state-run line managed public sector organisations.

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

A modern NHS is also one in which patients have power and choice. So if the local NHS hospital cannot offer a short enough waiting time but another hospital can patients can choose it.

Choice over hospitals has always been there of course but only as the exclusive preserve of those who can afford to pay. That is two tier health care. I believe health care and choice in health care should be based on need not ability to pay. So choice needs to be available on the NHS. Already hundreds of NHS heart patients have been able to choose faster treatment by choosing a different hospital. And as NHS capacity expands so choice will grow. By the end of 2005 we aim to have NHS patients needing a hospital operation in every part of the country having a choice over the hospital, the time and even the doctor that’s best for them. This reform marks an irreversible shift from the 1940s take it or leave it, top down service. Patients will be in the driving seat – and not before time. Resources will follow the choices patients make so that hospitals who do more get more; those who do not, will not.

There is a simple deal on offer here. The better you do the more you get. It is a discipline that needs to work just as much in the public sector as in the private sector.

Some say that a service, centred on individual patients offering real choice, can only happen in a private market by forcing patients out of NHS care into treatment they must pay for themselves. I say that with the right level of investment and the right programme of reform the NHS can deliver a modern responsive service to the people who use it and those who fund it. That is what we intend to do. We want to work with you to make it happen.