Breaking the Code and the Healthcare Chain

'In the conduct of their parliamentary duties, Members of the House shall base their actions on consideration of the public interest, and shall resolve any conflict between their personal interest and the public interest at once, and in favour of the public interest.' - the Lord's Code of Conduct

The Lords have spoken. The coalition with a little help from Labour Peer, Lord Warner chose to vote in favour of the government to keep section 75 regulations of the Health and Social Care Act in place. In doing so, they imposed increased legal pressures on the new commissioners to put out services to tender, which will fragment the NHS into the hands of private companies.

The Members’ financial interestsrepresent every stage of the healthcare value chain: from private equity firms that fund private healthcare companies, to holding shares in those same companies. They are Chairmen of companies who run NHS estates, are involved in PFI deals, are partners in legal firms that seal those deals, advisers to private hospitals, they also represent companies in pharmaceutical media, medical equipment, care homes, lobbying, and health insurance.

You name it, the corporations have it covered; and the list of vested interests in both the House of Commons and the Lords is so great, it is effectively a healthcare coup d’état against our parliamentary institutions (see partial list below). Yet all of the peers with such vested interests were able to vote on the Health and Social Care bill and the section75 Regulations, that now threatens to hand over large chunks of the NHS into private company hands.

The public, once again were placed in a situation whereby the future direction of the NHS was in the hands of unelected individuals who have vested interests in the outcome of their vote. One in four ConservativeLords have these interests, as well as one in six LabourLords, one in six CrossbenchLords and one in tenLiberal Democrats. This is democracy today in Britain.

The position they hold blurs the line between public and private duty. Some of the companies who employ Lords have already won contracts in the new NHS since the health bill became an Act; in some casesat the very samemoment the bill was being debated. The outcome of the vote has been made, but the institutional corruption remains.

Below, I have a list of unelected Peers from the upper chamber who represent the corporations that cover every part of the healthcare chain – they have it all wrapped up.

A selection of interests

Frontline services: Lord Nash

When Chairman of Care UK, John Nash – a Conservative Donor – made a donation of £21,000 to then-shadow health secretary, Andrew Lansley, co-author of the Health and Social Care bill. Nash now sits on the free market board of the Centre for Policy Studies, which has produced several papers on dismantling the NHS. Voted to reject the removal of the Section 75 regulations.

PFI: Lord Blackwell

Chairman of Interserve, consultancy to NHS and private healthcare firms. Involved in PFI hospitals. Company has enterednew avenues within the care industry made possible by the Health and Social Care bill and by his vote on the bill. Voted to reject the removal of Section 75 regulations.

Private Equity: Lord Patten of Barnes and BBC Chief - Adviser to private

equity firm Bridgepoint, who purchased Care UK – Have been involved in 17 healthcare deals over recent years – did not vote. See his article here.

Management consultancy: Lord Hamilton of Epsom - Has a directorship with MSB Ltd (managing consultancy), who have NHS, Bupa, Nuffield Health and CareUK listed as their clients. Quotes: 'My Lords, surely one of the problems of the National Health Service is the wall of money that was thrown at a totally unreformed NHS by the last Government? Do we not need management consultants now to show us the way forward.’ See article on him here. Voted to reject the removal of the Section 75 regulations.

Legal: Lord Clement-Jones

Managing partner with global law firm DLA Piper who provide lobbying services to clients in the health and social care sectors. Lord Clement-Jones nominated Lord Hameed for his peerage. Lord Hameed sits on the board of Alpha hospitals, part of the Alpha Healthcare (C&C Alpha/C&C business solutions) group. The Alpha group has made significant donations to the Liberal Democrat party. Voted to reject the removal of Section 75 regulations.

Shares: Baron Higgins

Holds in excess of £50,000 of shares in Lansdowne UK Equity Fund, backers of private hospital group Circle Holdings. Circle won the first contract to run a NHS hospital – they are advised by Conservative MP Mark Simmonds. Voted to reject the removal of Section 75 regulations.

Litigation: Lord Lang of Monkton

Conservative – Director of Marsh & McLennan Companies that “help hospitals, insurers, pharmaceutical companies and industry associations understand the implications of changing policy environments”. Head of ACOBA – a so-called independent body that advises on business appointments. See article on him and them here. Voted to reject the removal of Section 75 regulations.

Care Homes: Lord Popat

Founder of TLC group Ltd, who run private care homes. Lord Popat gave David Cameron a donation, as a gift, of £25,000 a week after the Conservatives’ unveiled their health ‘reforms’. David Cameron made the businessman a peer shortly after getting into 10 Downing street. Voted to reject the removal of Section 75 regulations.



Pharmaceutical Communications – Lord Chadlington Chief Executive of Huntsworth Communications group – have major pharmaceutical companies as clients. Company gave £15,000 to Conservatives in August 2011, has given money every year since 2008. Labour’s Lord Puttnam is a director. Liberal Democrat’s Lord Alliance has shares. Neither member voted. For more on Lord Chadlington and Lord Alliance – see hereand here.

Pathology:Lord Warner

An adviser to Pathology company, Synlab Ltd. He is a former adviser to Apax Partners, one of the leading global investors in the healthcare sector. Chose to vote against his party and with the coaltion (Labour).

Insurance: Lord Sharman

Chairman of Aviva, has directorship and Shareholdings in Aviva plc. Baroness McDonagh: Non Executive Director of Standard Life plc, which offers private health insurance. Did not vote.

Recruitment: Baroness Bottomley

Chair of Odgers Berndtson – recruitment company providing people for NHS Management positions. Shares in Broomco Ltd, a holding company of International Resources Group Ltd, which owns Odgers Berndston. Richard Boggis-Rolfe, the chairman of Odgers Berndtson, has given £207,500 in donations to the Conservative party between 28/09/2006 to 03/03/2010. Voted to reject the removal of Section 75 regulations.

Out of Hours: Lord Filkin (Labour)

Adviser to outsourcing giant Serco. Serco run out of hours services and were caught fiddling their data. Continue to be given contracts despite this. Did not vote.

Healthcare Coup: The Lords Didn't Save us the First Time

Lord Tim Clement-Jones

In early 2012 the Lords voted in favour of the Health and Social Care bill, the final step in turning it into an Act. As the Lords sat in the house to debate and vote on the bill, research conducted by Social Investigations revealed the Lords were riddled with private healthcare interests across all parties. Despite these recent or present financial links to private companies involved in healthcare, they were allowed to debate and vote. 

Now, for the second time of asking the Lords are about to pass or reject a key piece of legislation that will affect the NHS to such an extent its very existence is in the balance. Will they or will they not choose to vote for or against section 75 Regulations of the Health and Social Care Act. If it is the former, then if passed will sound the death knell to the NHS.

Section 75 or the NHS (Procurement, Patient Choice and Competition) (No. 2) Regulations 2013 to give it it’s full title, will potentially force the new Clinical Commissioning Groups to tender out all hospital and community carework for GP patients through competitive markets run according to EU competition law. It would open up all areas of NHS provision that interest the private sector to competition. The NHS as we know it will end, providers will be pitted against one another, with traditional local hospitals against multinational corporations. The legal teams of both sides will be among the winners and deciders of what happens to our services. But it is for global services firms such as DLA Piper, where Nick Clegg’s wife was formerly a partner in charge of competition law work, that the prizes are in store.

One global legal partnership heavily involved in European competition law is DLA Piper, who provide lobbying, public affairs and trade policy services as well as advice on how to get access to public service delivery contracts. One partner of the firm who is part of the Liberal Democrat party preparing to make their choice on the vote on the regulation is Lord Tim Clement-Jones.

The Liberal Democratic Health team is led by Baroness Judith Jolly and the third member is Baroness Shirley Williams, neither possesses the legal expertise needed to understand the implications of the regulations by reading them themselves. However, lawyer Lord Clement-Jones who makes up the other member, will be an influential figure in the decision the Liberal Democrats make on the regulations.

This is of deep concern if you are keen to maintain a cohesive and comprehensive NHS. The Liberal Democratic Peer is a patron of the health think tank 2020Health, who have four peers as patrons, all with financial interests in private healthcare. 2020health Chief Executive Julia Manning has openly called for an increase in private healthcare, and when challenged by Social Investigations on whether their membership contains health insurance companies, they refused to answer. However, former 2020Health Chairman, Tom Sackville – a former Conservative minister – is the current CEO of the International Federation of Health Plans, which represents one hundred private health insurance companies in 31 countries.

Lord Clement-Jones involvement, is the tip of a parliamentary private healthcare iceberg. The Members financial interests represent every stage of the healthcare value chain from private equity firms that fund private healthcare companies, to holding shares in those same companies. They are Chairman of companies who run NHS estate, who are involved in PFI deals, partners in legal firms that seal those deals, advisors to private hospitals, they represent companies in pharmaceutical media, medical equipment, care homes, lobbying, and health insurance. You name it, the corporations have it covered and the list of vested interests in both the House of Commons and the Lords is so great, is effectively a healthcare coup d’état of our parliamentary institutions.

We are in the hands of a group of 145 Lords and Baronesses who have recent or present financial interests private healthcare. Are there enough Peers with a conscience to prevent this regulation being passed? In an ideal world they wouldn’t have the vote at all, for their vote is akin to handing a key to a burglar who knows what lies within. In the meantime Baroness Jolly and Shirley Williams may well ask if Lord Clement-Jones is truly on the side of the NHS or whether he is part of the gang who will all be taking their slice from the NHS pie.

This article was cross-posted on OpenDemocracy

Tax Haven? No Contract

The message proffered by David Cameron when he spoke at the World Economic Forum in Davos was tax avoidance would become a priority of the UK’s presidency for this year. In reality, the government acts in the opposite manner, rewards those companies who channel money to tax havens with further contracts paid for by the taxpayer.

The calls for the government to bring about an end to tax havens has continued to grow ever louder as the general public observe the stripping of the welfare state, whilst billions of pounds exits the county into offshore accounts. Many of these companies are in receipt of taxpayer’s money, which are handed contracts by cash-strapped councils who continue to work with the organisations despite their dubious tax practices.



Take Telereal Trillium, responsible for a £3.2bn 20-year deal to manage and provide property services for the DWP offices. Through a complex network of accounts, the group of companies have channeled over half a billion pound through a complex series of accounts via a company based in the British Virgin Islands. Now aside from the fact that one of the directors linked to the Bermuda trust part-funded David Cameron’s leadership campaign in 2005 with two £10,000 payments, they are an approved bidder for MOD contracts worth up to £4.35 Billion.

Care UK, which operates across large areas of the NHS is accordingto non-profit research project Corporate Watch, reducing its tax liability by routing £8m a year in interest payments on loan notes issued in the Channel Islands. Care UK, who through their former chairman John (now Lord) Nash funded Andrew Lansley’s office when he was shadow health secretary to the tune of £21,000. Care UK, who through Harmoni are the largest provider of Out of Hours service have come in for consistent criticism, yet none of this halts their expansion fueled by the general public.

Circle Health who have Conservative MP Mark Simmonds as an adviser, is owned by companies and investment funds registered in the British Virgin Islands, Jersey and the Cayman Islands. The reward for this was for them to become the first company to run a NHS hospital.

Ramsay Health Care, Australia's biggest private hospital chain, bought Capio UK in 2007, acquiring hospitals and nine Independent Sector Treatment Centres for NHS patients. Ramsay according to Corporate Watch now has ‘22 hospitals across the UK and almost 60% of its work is from the NHS.’ Ramsay has the largest amount of healthcare provision contracts in the NHS, and used a subsidiary in the Cayman Islands to finance the purchase of a French health company for its Australian parent company. This is important for they ‘borrowed £57m from RHC Finance Ltd, a subsidiary of its Australian parent registered in the Caymans, to finance the acquisition of a 57% share of the Proclif Group, re-branded as Ramsay Sante, a leading French private healthcare company. This led to £1m leaving the UK for the Cayman Islands in interest payments.’ According to a Guardianreport Ramsay Health Care is the third biggest supplier to the NHS receiving £30 million in revenue in 2010/2011.

In written evidencegiven to the treasury in 2011 on Private Finance Initiative, Dexter Whitfield, the Director of European Services Strategy Unit revealed an increasing number of PFI projects registered in tax havens. Equity in 91 PFI projects is owned by secondary market infrastructure funds located in tax havens. These include HSBC Infrastructure in Guernsey, John Laing also in Guernsey and Venture Capital company 3i, who are in Jersey.

Research conductedfor Tax Justice Network by James Henry, a former chief economist at the consultancy McKinsey, estimated that at least £13 trillion is hidden in offshore accounts by the year 2010.  The government is of course aware of the behaviour of these companies; after all they created the system that allows it to take place. As the Tax Justice Network put it: ‘Tax havens and offshore financial centres have created an interface between the illicit and licit economies, corrupting national tax regimes and onshore regulation.’

The government’s response to tax havens has been pathetic and as far as the HMRC goes, they have weakened the organisation in terms of staffing. In addition, the Conservative special adviser and former corporate tax lawyer Edward Troup has been placed in charge of tax at HMRC. He is supported by Ian Barlow who was the former senior partner at KPMG who were fined$455 million a few years back for tax abuses. Furthermore the HMRC ethics committee is chaired by Phil Hodkinson, who is a director of the Resolution insurance company based in a tax haven.

The ultimate aim ought to be the end of tax havens, a unified tax that prevents competition and halts the harmful race to the bottom. In the meantime while this battle continues, there is one action the government can take to force companies to change their tax habits and perhaps for a campaign to be started?

Any company who has a tax haven in any part of their organisation will not be allowed to participate in any bid for a contract funded by the taxpayer. The government themselves won’t do this without pressure because they are funded by the City, who are the worst offenders of them all. However, now that they have decided to make this the main topic of the G8 presidency, then now is an ideal time to get them to justify why they pay taxpayers money in their droves to companies who avoid tax, whilst the welfare state burns.