Revealed: Head of Monitor Has Ties with Private Healthcare Lobby Group Who See Tax, Pensions and NHS Brand as Barrier in 'Fair Playing Field' Review.

The latest unholy mess taking place due to the undemocratic, unnecessary and complicated Health and Social Care Act, is the ‘Fair Playing Field’, review being undertaken by the new NHS regulator, Monitor.

A nine-month process has now seen all the submissions handed in and each organisation is wondering what is going to be the result of the review, come the end of March, this year.

April the 1^st is the time when the Clinical Commissioning Groups (CCGs) are due to takeover, from the Primary Care Trusts, abolished thanks to the new legislation. The ‘Fair Playing Field’ findings, which will conclude in time for this date, will mark the end of the NHS as we know it and increase the fragmentation of services across the country.

Social Investigations can now reveal a private healthcare group’s submission, which brings to the attention of Monitor the barriers the private sector perceive to achieve a Fair Playing Field, which include corporation tax, VAT, pensions and the NHS brand. The only problem is, this same lobby group were heavily influential in maintaining competition in the Health bill during the sham of a 'so-called 'listening exercise'. Furthermore, this same lobby group had previously met with the head of Monitor in a 'like-minded' meeting, bringing the impartiality of the review into question.

The NHS Partner's Network (NHSPN) is made up of private providers who provide NHS services and whose membership includes companies that include Care UK and Virgin Care. The submissionmade by the NHSPN was handed to Monitor in the early stages of the Fair Playing Field review last year, titled: 'NHS Partners Network response to Monitor's Call for initial submissions.'

On the subject of 'economic components', it states: '...to achieve any given post-tax rate of return, on an investment a corporation tax paying entity would have to charge higher prices than an NHS body or charity...the estimated average magnitude of this is that it now adds between 2% and 3% to independent providers.'

Monitor list 'tax asymmetries' as number four under 'Key Issues' to be looked at during the 'Fair Playing Field' review.  As well as corporate tax breaks, the NHSPN have also suggested the review look at the impact of VAT, stating, 'while NHS providers can claim back VAT on certain contracted-out services, independent providers cannot do so.' In addition, public sector providers are at an advantage because of the 'attractiveness' of the pension scheme ', which according to the submission, creates a barrier to workforce flexibility.'

Part 'C' of the submission, asks 'What do we already know about the elements of a fair playing field?' The response from the NHSPN points toward an 'illuminating piece of independent work' done in 2009 by the Office of Health Economics, partly paid for by the NHSPN.' The study builds on a previous work conducted by the University of York, but as the NHSPN funded study 'summarises the York study', they chose only to attach the study they helped fund. The NHSPN is however adamant that the study remains unbiased, stating: 'The report was co-funded by the NHS Confederation and the report itself makes completely clear that it was wholly independent. It went through OHE's normal peer review processes.’

In addition to providing this study, the NHSPN submission tries to weaken the element of public sector training and medical education, which is provided by the NHS. 'Most NHS education and training is 'funded centrally and separately from the main provision of care budgets and this does not therefore directly impact on the fairness of the playing field in the market'. However, as Mr Worskett admitted in a reponse to Social Investigations, when asked why this should be left out he said, 

'We do in fact recognise there is a legitimate discussion about medical education and training but there is a need for a much fuller and longer analysis of the issues before any conclusions can be reached.'

This is followed by a bullet point that states: 'A significant (but not yet quantified) proportion of independent providers do now participate in NHS education and training, in some cases at no cost to the NHS, and while this is doubtless only a small proportion of the whole, it must not be overlooked.'

A further disadvantage the lobby group highlights, is in the 'NHS' itself. Under a heading 'The impact of the NHS "brand"', they state, 'studies of the deregulated utilities markets have suggested that one problem, in developing a fairer playing field, was customer familiarity with and loyalty to the ex-public sector incumbent brands. There is a possibility that similar responses might work unfairly to the disadvantage of independent providers in the NHS market...'

Monitor are meant to be impartial, but the discovery of an internal memo written by NHSPN director, David Worskett reveals both he and Monitor chief, David Bennett met during the Health bill 'pause' under the auspices of free market think tank, Reform.

The document, which was discovered by research blog, Social investigations, was an update informing the groups members on the lobbying that had taken place during the so-called 'listening exercise'. Mr Worksett informs his members how: 'I had a second lengthy meeting...under the auspices of "Reform", with only a handful of other (all like-minded) people present, including David Bennett, the chair of Monitor. He has also consistently taken the same line as us throughout.'

Furthermore, the same memo informs us how David Worksett 'coordinated' the position of the NHSPN during the pause, 'carefully with Monitor...' When asked what this position was, the NHSPN claimed it was 'to establish that Monitor, like us, had not seen the introduction of competition as an objective in its own right but, instead, as a means of improving quality of care for patients.'

David Bennett distanced himself from the comments saying: ‘The comments made are the opinion and conjecture of Mr Worskett and Monitor cannot be held responsible for these. Mr Bennett did attend the same meetings as Mr Worskett during the NHS listening exercise but at no time has he referred to himself as a ‘like minded’ person to Mr Worskett. Similarly there was no coordination of position between Monitor and the NHS Partners Network. ‘ 

David Bennett's bias was brought into question previously when a FOI revealed an email from an unnamed McKinsey executive from May 2010, suggesting it was exploiting its privileged access. It stated: “We have been gathering our thinking on the implications of the new Government programme for the NHS (and) have started to share this with clients. Would you like to meet to discuss it?” The recipient of the email was David Bennett.

None of this would have been necessary if it hadn’t been for the Health and Social Care Act. The manner in which the services are being sold off, serves only to fragment services and pit providers against each other. David Bennett was a former senior partner at McKinsey & Co, the architects of the £20bn savings that are being justified to sell off large chunks of the NHS. The ‘Fair Playing Field is about to launch the NHS into a brave new world, and what’s the betting the outcome will favour the private sector?

Further reading

1. NHS Partners Network - Who are they? here

2. Unedited document of lobbying by NHS Partners Network here 

3. Statement from NHS  Partners Network on Telegraph article - here 

4. The Telegraph, the Think Tank and a Very Dodgy Business - here

5. Unedited response to questions related to above article from NHS Partners Network here 

NHS Partners Network Response Regarding Fair Playing Field

Social Investigations - contacted the NHS Partners Network over their submission to Monitor, regarding the 'Fair Playing Field' review currently taking place.

In order to maintain openess - I have listed the entire response without editing here so readers can make their own mind up.

View the NHS Partners Network submission here.

Starts-----------

Let me make it absolutely clear that contrary to some reports at no point have we asked for relief from corporation tax. We have simply pointed out that in undertaking an analysis of the different economic factors that affect public and private sector providers of care, corporation tax is one of those factors that impacts on the private sector, but not on the public sector. We have also made clear that we recognise there are factors that work the other way and we now wait to see how Monitor's wholly independent and impartial analysis concludes the various factors "net out" and whether anything can or should be done about that overall, in the interests of patients not of providers", that being Monitor's remit.

You may not have seen Monitor's statement today, which makes their position on corporation tax clear and is indeed what we expected. It says:

"There is no draft report of the Fair Playing Field Review and Monitor does not intend to provide a running commentary on the review.  Monitor has yet to decide what recommendations it will make to the Secretary of State. However in the light of recent media speculation, Monitor has decided to clarify the position on one specific issue. While it is the case that corporation tax is one of many distortions that the review is looking at, Monitor will not be recommending that private sector providers should be exempt from paying corporation tax."

Answers to Questions

The Guardian recently revealed how tax breaks were part of the first draft of the review, seen by a 'source' -

The submission you made, which a source has handed to me shows your organisation pushed for this to be looked at as part of the review. Comment: Our submissions in response to public consultations are assumed to be in the public domain anyway and we are happy to share them with anyone who asks to see them.

You state how: 'The issues of a 'Fair Playing Field') must be viewed dispassionately through the lens of impartial and quantified economic analysis' However, despite the emphasis on 'economic analysis', no additional information was provided to suggest how they reached the 2/3% figure  stated in their submission. Q. To what do you base this figure on?  A.The full OHE study was provided as a formal annex to our submission and provides the basis for this analysis.

You also mention concerns over the NHS brand and how this may unduly lead to favourtism as the public trust the name. Q. This is why you attach the NHS to your name?  A. No, our name reflects the fact that we work in partnership with the NHS and are part of the NHS Confederation.

The NHSPN considers that the most illuminating piece of independent work on this complex subject was done in 2009 by the Office of Health Economics. This was part-funded by you. Q. Should this be seen as bias? A. No. The report was co-funded by the NHS Confederation and the report itself makes completely clear that it was wholly independent. It went through OHE's normal peer review processes. We played no part in the actual study and we have no doubt that OHE would take any allegations to the contrary very seriously.

You mention that various public attitude research has shown 'remarkably clearly' that patients are less concerned about who provides care provided it is free at the point of delivery and meets NHS standards. Q. Are you referring to a survey you paid for that was conducted by Brunswick?  A.Yes, supported by other authoritative independent reports which also indicate that most of the public are not worried about who provides their care as long as it is free at the point of delivery and is of high quality. For example, The Provider Diversity poll, (Confederation of British Industry, 2009); and British Social Attitudes 2009 (Sage Publishing, January 2009).

You state that private companies are subject to different regulatory regimes but fail to mention FOI. Q. Would your members be willing to be subject to Freedom of Information and thus being more transparent to the public? A. If there was a general application of FoI to all organisations that are not public sector but have dealings with the public sector, we would of course accept that position. Unless that is the case there is no reason for us to be treated differently to any other non-public sector organisation. The NHS Partners Network fully adheres to the NHS Confederation's policies and practices on transparency.

The submission, shows how you consider training and medical education as not being relevant to the 'Fair Playing Field' despite as you admit, many of your members benefiting from this training. Q. Why should this be left out? A. We do in fact recognise there is a legitimate discussion about medical education and training but there is a need for a much fuller and longer analysis of the issues before any conclusions can be reached. The independent sector also undertakes extensive medical education and training which has not been generally understood or recognised and this also needs to be taken into account.

Given your challenge to the public sector over the issues of pensions, training, medical education and the NHS 'brand' Q. Can you see why the public may view your behaviour as devisive and against collaboration? A. We have not "challenged" the public sector on these or any other "fair playing field" issues. We have simply sought to identify and quantify factors which may mean that, should commissioners wish in the interests of patients, to use alternative providers,  then economic factors do not prevent them from doing so in practice. Establishing a fair playing field will in practice facilitate collaboration.

Your document that was a feedback to members during the Health bill 'pause' stated: 'I had a second lengthy meeting with Stephen to discuss the position with him last week, under the auspices of "Reform", with only a handful of other (all like-minded) people present, including 'David Bennett, the chair of Monitor. He has also consistently taken the same line as us throughout.' Q. Are you confidant this connection you have with Mr Bennett will result in a favourable report? A.We are confident that Monitor will produce a properly considered and completely independent and impartial report and we will, like everyone else, have to wait and see what it actually says.