24,000 jobs to go as government overhauls NHS

The Health and Social Care Bill will see all 152 of England's primary care trusts (PCTs) scrapped alongside 10 strategic health authorities, leading to the predicted loss of 24,500 jobs.

Almost 21,000 of these losses will be through redundancy while the rest involve people leaving the service or retiring.

GPs will be given around 80% of the NHS budget - currently topping 100 billion a year - to commission services for patients.

A new NHS commissioning board will oversee this process and new "health and wellbeing" boards are being created.

But the plans have come under fierce attack from health unions and doctors' leaders worried that the reforms are "too much too soon".

The cost of implementing the changes is 1.4 billion but Health Secretary Andrew Lansley insists they will save the NHS more than 5 billion by 2014/15 and 1.7 billion every year thereafter.

Mr Lansley said: "Modernising the NHS is a necessity, not an option - in order to meet rising need in the future we need to make changes.

"We need to take steps to improve health outcomes, bringing them up to the standards of the best international healthcare systems, and to bring down the NHS money spent on drugs.

"This legislation will deliver changes that will improve outcomes for patients and save the NHS 1.7 billion every year - money that will be reinvested into services for patients."

The proposals prompted a fierce exchange in the House of Commons today with Labour leader Ed Miliband accusing Prime Minister David Cameron of being "arrogant" for pressing ahead with them despite warnings from unions and health experts.

Mr Miliband said: "Patients are worried. Doctors and nurses say your reforms are extremely risky and potentially disastrous.

"Why are you so arrogant to think you are right and all of the people who say you are wrong are wrong?"

Liberal Democrat Andrew George, a member of the Commons Health Select Committee, also asked why the Prime Minister was taking a "gamble" over the shake-up.

But Mr Cameron said the Government was "reforming the NHS so that we have got the best in Europe".

He said: "We want to see waiting times and waiting lists come down.

"The whole aim of these NHS reforms is to make sure we get the value for the money we put in."

A co-ordinating document published with today's Bill says between 50% and 70% of SHA and PCT staff are likely to be retained and employed by the NHS commissioning board and GP consortia.

The cost of redundancy due to the new changes is put at 1 billion by the Government. Another 400 million will go on other costs, including dealing with IT and property.

"Non-staff" costs for transferring functions to GPs is put at 323 million.

The document says there are risks due to the transition, including the potential loss of key personnel and skills from PCTs, the potential for double running costs and the fact that staff may become "preoccupied" with what is happening to their jobs.

"Similarly, given the structural changes, staff may be less focused on patient care during the transition.

"Some of this would be incurred anyway due to the reduction in staff numbers associated with the reduction in administrative spending.

"However, those staff most affected are not those who are involved directly with patient care."

GPs will receive a "quality premium" - a proportion of practice income linked to outcomes for patients and how well finances are managed.

The exact amount or percentage has not yet been set.

The document says: "The quality premium creates a strong incentive for GPs to work to ensure effective management of referrals and prescribing; however, a risk remains that not all GPs will engage."

But the document argues that there are multiple benefits for patients from the changes.

Shifting commissioning power to GPs means "decisions are made closer to the patient so the person's input is more likely to be influential".

New health and well-being boards will also bring together people working in the NHS, public health and social care in each local authority.

Local "HealthWatch" organisations in each region will "ensure the views of patients, carers and the public are represented to commissioners".

Under the plans, all NHS trusts will move towards become foundation trusts, removing current restrictions and enabling them to "innovate", the document says.

The regulator Monitor will have its role expanded so it becomes economic regulator, regulates prices, licenses providers and "promotes competition".

The timing of the reforms has come under repeated attack by unions and MPs on the Health Committee. The NHS is currently trying to save 15 to 20 billion in "efficiency savings".

The Royal College of Nursing's chief executive, Dr Peter Carter, said: "The stakes could not be higher for this substantial Bill.

"Nursing staff and other health workers have worked tirelessly to deliver improvements to the NHS over the past decade.

"Patients have benefited from decreased waiting times, better cancer and cardiac outcomes, improved access and flexibility of services, as well as more clinical staff.

"It will be very important that none of the recent improvements to the NHS are placed in jeopardy as a result of these reforms.

"Of particular concern is the sheer scale and pace of the change at the same time as the NHS is being tasked with saving 20 billion.

"The RCN is also concerned that fragmentation across the NHS could result in unexplained variations in service, a reduction in collaboration and less sharing of good practice - all of which impact on quality care."

Mr Lansley defended the plans, saying the headquarters of the NHS would now be the "meeting point" between doctors and patients to decide on best care, with GPs taking control of commissioning in 2013.

And he attacked trade unions for their criticism, in particular concerns over increasing competition in the health service.

The Bill allows for "any willing provider" - including private companies - to compete to provide services at NHS prices.

"Trade unions have always been against competition, that's what they have said for years," Mr Lansley said.

But they "argue it on a basis which is absolutely false", he said, adding that the Government was not legislating about competition on price but on outcomes.

The argument that GPs could have just been given more power in PCTs "misses the point", he said, adding that this would have left a "whole tier of management in place".

GP consortia will have a limit placed on how much they can spend on administration, he added, expected to be 25 to 35 per head of population.

Dr Hamish Meldrum, chairman of the British Medical Association, described the proposals as a "massive gamble".

He said: "Ploughing ahead with these changes as they stand, at such speed, at a time of huge financial pressures, and when NHS staff and experts have so many concerns, is a massive gamble.

"The BMA supports greater involvement of clinicians in planning and shaping NHS services, but the benefits that clinician-led commissioning can bring are threatened by other parts of the Bill.

"In particular, the legislation will allow competition to be forced on commissioners, even when they believe the best and most appropriate services can be provided by local hospitals."

Dr Meldrum said forcing GPs to tender contracts to any willing provider could "destabilise" local health economies and fragment care for patients.

"Adding price competition into the mix could also allow large commercial companies to enter the NHS market and chase the most profitable contracts, using their size to undercut on price, which could ultimately damage local services."

Shadow health secretary John Healey said: "This health Bill is three times bigger than the legislation that set up the NHS in 1948.

"It's a huge upheaval which will put unnecessary extra pressure on the NHS and could open up all parts of the NHS to competition from private health companies.

"The Health Secretary, Andrew Lansley, has not listened to the warnings from health experts, professional bodies or patient groups, and is set to force through these changes."

TUC general secretary Brendan Barber said: "This is the Government's ticking time bomb.

"The Conservatives told us before the election that there would be no cuts to the NHS, no top-down reorganisation and respect for the founding principles of the NHS.

"Today's plans break each of those pledges. A giant top-down reorganisation that will cost billions to carry out, opens the door to widespread privatisation and comes on top of eye-watering efficiency savings, all add up to a toxic cocktail of voter unfriendliness."

Sir Richard Thompson, president of the Royal College of Physicians, said it supported the shift towards putting "clinicians and patients in the driving seat".

But he added: "The scale and pace of change - and the challenge of unprecedented efficiency savings - should not be under-estimated.

"Neither should the risks if we get this wrong.

"We are also anxious to ensure that the system builds in effective safeguards to protect against service fragmentation.

"The fragmentation of services would have detrimental impacts on the very areas the reforms seek to improve - the quality of services, education and training, patient choice, efficiency and equity."

Karen Jennings, Unison head of health, said: "This titanic health Bill threatens to sink our NHS.

"The only survivors will be the private health companies that are circling like sharks, waiting to move in and make a killing.

"Lansley has turned his back on the warnings from across the medical establishment that these changes are unnecessary, undemocratic and unlikely to deliver improvements in patient care.

"We need a U-turn from the Government."

David Cameron was today accused of being "arrogant" for pressing ahead with sweeping NHS reforms despite warnings from unions and health experts.

Labour leader Ed Miliband said doctors and nurses had warned of "potentially disastrous" consequences for the NHS.

Liberal Democrat Andrew George, a member of the Commons Health Select Committee, asked why the Prime Minister was taking a "gamble" over the shake-up.

But at Prime Minister's questions Mr Cameron said the Government was "reforming the NHS so that we have got the best in Europe".

Mr Miliband asked the Prime Minister for a guarantee that hospital waiting times would not rise.

Mr Cameron told him: "We want to see waiting times and waiting lists come down.

"The whole aim of these NHS reforms is to make sure we get the value for the money we put in."

As the level of noise in the Chamber rose, with Labour MPs accusing Mr Cameron of failing to answer, Commons Speaker John Bercow intervened.

He said a 10-year-old constituent had visited to watch last week's particularly hostile session and asked "why do so many people shout their heads off?" adding "it's rude and it shouldn't happen".

Mr Cameron joked: "I'd love to know what your answer was."

He insisted that the Government was spending 10.6 billion extra on health this Parliament "but we want to get value for that money because, frankly today we don't have the right cancer outcomes, we don't have the right outcomes in terms of heart disease, we want to do better".

Mr Miliband said: "Patients want to know something quite simple: how long will they have to wait for treatment, because they all remember waiting for years under the last Conservative government."

Mr Cameron said waiting times would rise if money was not put in to the NHS, telling MPs that shadow chancellor and former health secretary Alan Johnson had said there was "no logic or rationale" to the Government's plan for above-inflation increases in health spending.

"That is the answer: you get investment in the NHS from this coalition Government, you get cuts from the party opposite."

Mr Miliband said the Government had abolished guarantees on waiting times and was "taking the national out of the National Health Service".

He added: "Patients are worried. Doctors and nurses say your reforms are extremely risky and potentially disastrous.

"Why are you so arrogant to think you are right and all of the people who say you are wrong are wrong?"

Mr Cameron told Mr Miliband he was wrong over waiting times: "The waiting time points that you made are written into the NHS constitution and will stay under this Government.

"We won't be able to get waiting times down, we won't be able to improve public health in this country unless we cut the bureaucracy in the NHS.

"That is what this is about. We are spending 1.4 billion, one off, to save 1.7 billion every year.

"That will save 5 billion by the end of this Parliament."

Mr Miliband said Tory MP and GP Sarah Wollaston had compared the reforms to "tossing a hand grenade into the NHS".

He said Mr Cameron was breaking promises on health and added: "It's the same old story: you can't trust the Tories on the NHS."

The Prime Minister shrugged off the "feeble, pre-scripted" attack and mocked Mr Miliband: "You practise them every week, I'm sure they sound fantastic in the bathroom mirror."

He added: "This Government is putting the money into the NHS - they don't support that.

"This Government is cutting the bureaucracy in the NHS - they don't support that.

"This Government is reforming the NHS so we have got the best in Europe - they don't support that."

Mr Miliband's policy was "no to the money, keep the bureaucracy, don't reform the NHS - I'd go back to the blank sheet of paper".

The Health and Social Care Bill published today has attracted widespread criticism from unions and policy experts worried that the reforms are "too much too soon".

Under the plans, GPs will be handed the bulk of the 100 billion health budget to buy-in services for patients and a new NHS commissioning board will oversee the process.

All of England's 152 primary care trusts (PCTs) will be scrapped alongside 10 strategic health authorities (SHAs).

PCTs are already being streamlined into "clusters" as part of the transition, with the aim of getting them to work with GP practices and emerging "GP consortia".

Mr George (St Ives) asked why such a "massive reorganisation" was taking place while the NHS was "seeking the greatest savings in its 62-year history".

He added: "Respected professional medical bodies warn about the risk to public service of giving private companies the easy pickings.

"Before pursuing this gamble will you carefully reflect, informed both by the clinicians and the coalition programme which we agreed last May?"

Mr Cameron said: "We will listen very carefully to the professionals but the reason for making modernisation of the NHS such a priority is simply this: we have now in this country European levels of health spending but we don't have European levels of success in our health service.

"Of course what we want to see is a level playing field for other organisations to come in to the NHS.

"What we won't have is what we had from Labour, which was a rigged market."

Senior Labour MP Tony Lloyd (Manchester Central) said people in his inner-city constituency were likely to die younger than those in other parts of the country.

He asked: "If you won't give a guarantee about waiting lists nationally, will you make a solemn and binding pledge to my constituents that, at least for the inner cities, waiting lists will not go up either in numbers or in time?"

Mr Cameron said: "As you have just revealed, we have health inequalities in our country that are as bad as Victorian times.

"Now we've had that after a decade of increased money on the NHS but we're not getting it right. That's the reason for carrying out these reforms.

"If you just stay where you are, which now seems to be the policy of the party opposite, we're going to lag behind on cancer, we're going to lag behind on heart disease... Let's reform it and sort it out."

Labour's Grahame Morris (Easington) asked: "Do you see there is a conflict in interest in private heathcare companies, which stand to benefit most from your healthcare reforms, donating 750,000 to the Conservative Party?

"Is that what you mean by 'We're all in it together'?"

Mr Cameron said Labour had "rigged the market in favour of a few hand-picked independent private sector suppliers".

He added: "What we are saying is that there should be a level playing field."

Tory Lee Scott (Ilford N) said: "As part of the NHS reforms, we must tackle straightaway the fact that senior management of both NHS trusts and PCTs (primary care trusts) are being rewarded for failure by being promoted or given large pay-offs - and it should stop now."

Mr Cameron said: "You are entirely right - there have been too many occasions where a manager in the NHS has failed in one PCT or one strategic health authority and got on and failed in another.

"One of the answers to this is the greater transparency we are bringing to all these arrangements, so people can see how much they're paid, what the results are and how successful they were, before they go on and land another well-paid job."