Guest editorial Wednesday 8 September 2010: Something Better Change

Irwin Brown of the Socialist Health Association looks at Transforming Community Services (a.k.a. Turkeys' Christmas Solidarity)

There is a deadline of April 2011 for all PCTs to have divested themselves of their provider functions. All or part of them can transfer to a foundation trust (FT) or to a local authority, on a short-term or permanent basis.

There is also talk of the John Lewis model - staff co-operatives, other co-operatives, mutuals, staff-led FTs, proper community FTs, small community FTs, or a sell-off to the private sector. Sadly, there is no model for genuine community ownership.

Hyping social enterprise
There is much hype about the social enterprises that are to be formed. All the above mentioned can be a 'social enterprise' - even private sector, as long as they have some kind of socially desirable objectives. As social enterprises, they cannot distribute their profits to investing shareholders; so in theory any profits are used to meet socially desirable ends - but in reality, almost every known trick could be applied to direct money, pre- or post-profit, to staff or investors or partners.

Staff in PCT provider functions have the “right to request” (R2R) that a social enterprise be formed for some or all of the functions, and have until the end of next month to complete an expression of interest.

This R2R was supposed to be one of those bottom-up things where staff make clear their views, but according to trade union colleagues, in practice it is the opposite. The proposals have been management-led, with staff being told that the other options are worse. A staff ballot to determine support was promised in the North East, but then suspended. Probably suspended by the neck until dead.

A line of least resistance trend was to join a nearby acute or mental health FT. This keeps staff and the functions they carry out properly in the NHS, at least for now. For many staff, such a solution, preserving the integrated nature of our NHS, and leaving them (just about) in protected national bargaining (and pensions) arrangements was obviously the best step.

Vive la resistance!
On the other hand, there is resistance to such change.

First, from community staff fearing the importance of their work will be lost in a large acute trust; and then from managers, who know that for them transfer to another NHS organisation would almost certainly cost them their role and probably their job; going from big fish in small pool to unimportant.

Many suggest there could be great scope for rationalisation and cost savings in community services. Others argue there are great opportunities to get much better value from them.

If not integration, then another NHS solution must be to have community FTs (like the acute, mental health and ambulance versions). But the FT model has mainly required large scale: many would say even trusts of £100 milliion annual turnover will struggle to justify their high (relatively) cost of governance; and there are issues around ownership of assets and access to capital funding.

Of the six community FT pilots currently aspiring to 'proper' FT status, some do have applications with the DH. As of today, none have been forwarded on to Monitor.

The palaver of passing the FT exam
Looking back over the accreditation process of the 130 odd FTs shows how this took even high-performing organisations much effort over many months - often with extensive use of external consultants. The full Board was tested, every aspect of governance explored and the plans and finances gone over with some rigour.

Monitor may well be shown by the various Mid Staffs enquiries to be hopeless at important quality and safety governance matters (so far as patients are concerned), but it was good at financial evaluation. Even after six years, some well-known trusts still cannot make the grade.

FT Lite?
It is hard to see how fledgling community FTs could pass this kind of evaluation, since they will have no track record. Maybe there will be a kind of second (and maybe even third) class of FT, which has not been through robust accreditation, and does not have the full-blown stakeholder-based governance model set out in Monitor’s codes. FT Lite, anyone?

Anyway back at the social enterprise option; why do it? Should enthusiasm and hope outweigh caution?

Why would staff agree to leave the NHS, when many value the mere fact that they work for such a unique organisation? Why hasten the break-up and privatisation of our NHS? Is there really the management capacity for a stand-alone independent organisation?

The risks are great. With all future services being offered to any willing provider, there is no scope for any kind of guarantee of income. They will have to compete, almost from day one, with the private sector and maybe predatory FTs. This is a worry, as generally entry costs and barriers are much lower in this area than for more complex care.

Maybe some small niche providers could perhaps survive and even thrive. Larger providers will risk seeing their services picked off, one by one, as they are unlikely to build up the skills to match the private sector in bidding for contracts.

With a few notable exceptions, there has not been anything like enough consultation about this with patients, the public or the staff; and health overview and scrutiny has been sadly lacking.

There are no easy answers, and panic before the arbitrary deadline of April 2011 will not make finding sustainable solutions easy.