Official Report (Hansard)

Session: Session currently unavailable

Date: 07 June 2007





 PFI/PPP Issues

Thursday 7 June 2007

Members present for all or part of the proceedings: 
Mrs Iris Robinson (Chairperson) 
Mrs Michelle O’Neill (Deputy Chairperson) 
Mr Thomas Buchanan 
Rev Dr Robert Coulter 
Dr Kieran Deeny 
Mr Alex Easton 
Mr Tommy Gallagher 
Mrs Carmel Hanna 
Ms Carál Ní Chuilín 
Ms Sue Ramsey

Ms Patricia McKeown } Unison 
Mr Jonathan Swallow } Unison

The Chairperson:
Ms McKeown and Mr Swallow, welcome to the Committee. The Committee has just met members of the Royal College of Nursing, who did not want to steal your thunder on PFI. I understand that your time is limited; therefore you will have 10 minutes to make a presentation, and then we will open up the meeting for discussion.

Ms Patricia McKeown (UNISON NI): 
I am the regional secretary of UNISON in Northern Ireland and this is my colleague Jonathan Swallow, a consultant who has worked with us for many years, primarily on issues such as healthcare policies and on combating privatisation in the health and social services system.

I welcome the opportunity to speak to the Committee about one of the five key issues on which we have been lobbying for the past four years and which we are raising with the new Minister of Health, Social Services and Public Safety. We hope that the Committee will agree with us and put pressure on the Minister and on the Executive for change.

The key issues are: the health budget; the system of healthcare delivery that was imposed on us by Shaun Woodward; procurement, specifically PFI; sorting out Health Service pay — and the Committee has just heard from our colleagues in the Royal College of Nursing — and promoting Investing for Health, an excellent policy that the last Executive put in place and which now needs to be resurrected on behalf of the people.

UNISON makes no secret of its deep reservations about PFI as a form of procurement. The Committee will be aware of the infrastructure investment strategy and the millions of pounds that are to be spent on building infrastructure in Northern Ireland over the next decade or so, which is welcome. Roughly £2·7 billion has been earmarked for building, rebuilding and refurbishing our hospitals and social services community care delivery, and although we support that — much of it is long overdue because of decades of backlog maintenance — no one has been able to explain to us who took the decision to build or rebuild virtually every acute hospital across Northern Ireland and why PFI is the favoured method of procurement.

PFI is not quick, although some people have advocated it as a fast way to sort out some of our health infrastructure problems. It is no longer off the balance sheet, so there is no excuse for going down the PFI route as opposed to either conventional procurement or other not-for-profit routes.

The collective wisdom of the construction industry is that the type of buildings that we are talking about will need major maintenance after 15 years and will probably have to be rebuilt after 25 years. Yet the intention is to hand them back to the Department of Health, Social Services and Public Safety after 25 years, with all the problems that that will entail.

PFI schemes cost more than conventional procurement, even for those who argue that that is the price that one pays for a longer-term loan. Those figures, which we will demonstrate to the Committee in more detail, are extremely worrying and cannot, under any circumstances, be considered value for money.

Even when a PFI proposal meets the Treasury Green Book requirements, it is fraught with all the difficulties that I have described. The problem is that we now have several live PFI health and social services projects that have been manipulated to meet the Green Book appraisal. They include proposals to cut down and strip out beds and to cut down and strip out the exemplar hospital designs that have been produced by our Health Service’s estates, whose designs have been commended internationally both from a sustainable environmental perspective and because they are innovative on healthcare delivery — they are good for the health of patients. There is pressure on them to strip out innovation.

The Green Book has been manipulated by proposals to privatise and transfer front-line healthcare workers and, in the case of the former Sperrin Lakeland Health and Social Services Trust contracts in particular, to cut jobs by an outrageous 25%.

Mr Jonathan Swallow (UNISON NI):
There are 10 acute PFI schemes in the pipeline. The Enniskillen project is three months away from issuing final invitations to tender. The Omagh local hospital contract was recently advertised in the Official Journal of the European Union (OJEU). The Royal Victoria Hospital and Ulster Hospital schemes have been approved by their trust boards in the past few months, but so far the Department has not given permission to advertise. It appears that the Department is now reviewing all capital schemes. We will suggest to the Committee some of the issues that the review must cover, given the present situation.

It is important that the Committee understand that there are 25 to 30 health centre projects, called primary and community care infrastructure (PCCI) projects, also in the pipeline. In the past year there has been no progress on them whatsoever, although there has been a debate about which form of PFI to use. One of the officials responsible recently likened the situation to being a hamster on a wheel: there is no progress. We fear that the deficits and gaps occurring in the acute sector will block progress in the primary sector as well. That is what we face.

Under Treasury rights, unions can see certain documents, and although it is sometimes a struggle to access them, we do our best. On Patricia McKeown’s behalf, I have been analysing disclosed outline business cases, and I have found some things that concern me greatly.

First, there is clear evidence that in order to achieve what Patricia referred to as Green Book value for money — the requirements that a project must meet to become a PFI — workers are becoming the price of the deal. The Enniskillen and Omagh projects both feature a consultancy report that reduces the number of posts by 25%. There has been no equality assessment or other consideration of that report. There were 10 options in the report, the cheapest of which, SDM10, was taken.

In the case of the Omagh local hospital project — where the level of disclosure was rather better than in the Enniskillen case, because they gave me the uncut document by mistake — there were 12 calculations of Green Book value for money.

Four of the calculations were positive for PFI — only just — and they only made that figure because of the 25% job cuts outlined in the consultancy model.

The Ulster Hospital project saving was dead on the edge — about 0·1% — yet, suddenly and magically, it rose to more than 4% as regards Green Book VFM. That figure increased on the basis of a report from consultants that implied that domestic staff could work 35% harder — that means carrying out four hours’-worth of work in three hours. I have had the privilege of talking to some domestics and of seeing the work that they do. I must tell the Committee that the women of Ballybeen are not impressed with the consultants’ proposal. They are hardworking, conscientious, long-serving domestics. Various sources in England to whom I have talked regard the figure of 35% as either laughable or tragic.

The affordability gap is another crucial issue that has emerged from the outline business cases. I did some calculations, and, in some cases, the gap is evident. The average gap is about £20 million. The trust boards have said that that is the Department’s problem. Some £20 million a year is needed to make the Ulster Hospital project happen, and I do not think that the Department has the money. If that is the case, the money will have to be found by cutting local Health Service budgets, including staff budgets, which will impact on everyone who uses the Health Service. Indeed, in the previous evidence session, the Committee heard from representatives of the Royal College of Nursing about the pressures on health staff and the cuts in nursing budgets.

As regards hospital bed numbers, the projects are based on an assumption that people will stay in hospital for no more than 30 days, unless they are a stroke patient or a geriatric patient, in which case the model allows for 50 days. The documents propose that a further 10% reduction in beds could be achieved by adopting the Evercare model, which is a US model for minimising hospital admissions from elderly people. However, the trials of the Evercare model in England showed that it made no difference to hospital admission rates. On top of that, the Department has unilaterally adopted a policy that only 50% of beds in the new hospitals should be single spaces, compared with the 70% that is standard policy over the water.

Hospital food provision is another issue. Two of the three tenderers for the Enniskillen hospital project propose to provide food that will arrive cook-chilled or steamed from England. The Committee should bear in mind that the previous trust for the area, the Sperrin Lakeland Trust, was the lead partner in the EU Renaissance of Atlantic Food Authenticity and Economic Links (RAFAEL) initiative, which promotes local sourcing and production of food.

Finally, the 2001 review of public procurement recommended that those projects should focus on local regeneration through training, apprenticeships and the development of local people’s skills. The projects will be undertaken using a PFI model known as SOS P4, which makes no provision whatsoever for that. I see no apprenticeships or local training models and no way of engaging people who have been economically inactive or unemployed in the development of those projects. Furthermore, the local construction economy is being significantly squeezed out of participation in the projects.

Ms Ní Chuilín:
I welcome the witnesses, and I have questions for both of them.

Mr Swallow mentioned a case that will come up this summer. Could the Committee hear more about that? Can it be stopped or is there a cut-off point? Is there anything that the Committee can do to influence the situation?

I would also like to ask Ms McKeown to what extent inequality issues have arisen for workforce elements of PFI.

Mr Swallow:
The Enniskillen hospital project is being undertaken — and I am sorry to use such words in front of the Committee — through the EU competitive dialogue procedure. That means that all tenderers will be invited to submit a standard solution. There is nothing, either in the advert for the project or in anything that has happened to date, that means that the trust cannot, for example, require that local catering be used, exclude support-services workers from the project, or seek its requirements. I regret that I must say that a major problem has been that all correspondence with the previous and current trusts since January has not been replied to, and no request for a meeting has been granted.

On Tuesday evening, we alerted the chief executive of the Western Health and Social Care Trust that we had no alternative but to mention that fact to the Committee.

The trade union finds it very difficult to make a reasoned case, particularly when no one will even let us into the room to make representations. Meanwhile, the tendering timetable ticks on.

Ms Ní Chuilín:
What is the deadline?

Mr Swallow:
The final invitation to tender for the Enniskillen hospital project will be issued in August this year. Changes in procurement will, therefore, be very difficult after August.

Ms McKeown:
The issue of equality has been highly contested throughout the entire process. There was no equality impact assessment (EQIA) undertaken of the overarching decision to go for the figure of £2·7 billion, or for the selected procurement method.

We have really had to fight — that is the only way in which to put it — for a proper EQIA on a project-by-project basis. The Strategic Investment Board (SIB) has resisted that process. The SIB seems to have either little or no knowledge of that issue. Moreover, it is probably closer to the truth to say that it does not understand that an EQIA of that method of procurement would raise serious concerns for healthcare delivery for citizens, and would, right away, demonstrate that there will be cuts in healthcare delivery.

Those cuts are likely to be made in areas of greatest need. We will not be able to find the money for the range of service developments that the Investing for Health initiative has promised, including those necessary for mental-health provision. We know absolutely, from all of the impact assessments that have been carried out, that the proposals to privatise or to transfer health workers will have an adverse impact, particularly on women. It is ironic that, in the Omagh and Enniskillen projects, after 10 years of privatisation of the domestic and catering services — and on the heels of a circular from the Department of Health, Social Services and Public Safety about promoting its obligations on equality — serious work was done. UNISON worked jointly with the health employer on that matter over a period and an EQIA was conducted. It was determined that the level of disadvantage that privatised staff faced was unacceptable, and that the only proper route to promote equality of opportunity for them was to bring those services back in-house. A decision was taken to bring both services back in-house, and it took a couple of months for that transition.

However, three weeks before those staff got back through the door, a decision was taken to recommend those services for privatisation as part of the PFI projects. That was a fairly scandalous flouting of the law of the land and of the responsibilities that the Department of Health, Social Services and Public Safety, and others, has for the process.

Proper EQIAs would lay bare the drain on the health budget — particularly the local health budget — if £2·7 billion were to be expended on a PFI. That would cause deep inequalities and would certainly not leave any space for the necessary service developments.

The Chairperson:
Ms McKeown, the Department would argue that PFI frees up a great deal of money that go into front-line services. What are your views on that, and how would you argue your case?

Ms McKeown:
The Department has not dared to argue that point with us yet, probably on the grounds that we represent so many of the front-line services that are falling foul of PFI. The manipulation in order to get to the PFI stage is the proposal to either privatise or cut front-line services. That will not result in freeing up any money; if anything, it will create a drain on the current healthcare budget.

To demonstrate that drain, we recently gave the outgoing Minister with responsibility for health some hard financial figures from his own Department. We were promised that if we produced the figures to demonstrate that staff were the price of the deal, the projects would stop. However, we did not receive a response.

Mr Swallow:
The other crucial issue is that, as Patricia said earlier, the projects are “on balance sheet”, whatever happens. There can either be a long and expensive lease, via PFI, or a capital injection can result in the Health Service running all aspects of the hospitals.

I remember the phrase “freeing up resources” being used at the previous Assembly’s Committee for Finance and Personnel. The projects were “off balance sheet” at that time. We are now simply talking about different choices. Those choices may have an up-front capital cost, but, in the long term, PFI is demonstrably more expensive.

Moreover, the result of such PFI projects is that workers become a price of the deal, there will be long-term damage to beds and services, and design standards will be under pressure. Comparable situations over the water have shown that that happens. When the sums do not stand up in a PFI, the solution is to cut the beds and the design.

Ms McKeown:
A straightforward example of that is the decision, which was taken in the past month or so, to use PFI to build the new mother and children’s hospital at the Royal Victoria Hospital. The conventional build cost would have been in the region of £350 million; the PFI build will cost £855 million. For the next 25 years, roughly £28 million per annum will have to be found, not from capital but in the revenue budget for what has now become the Belfast Health and Social Care Trust.

As I understand it, the Belfast Health and Social Care Trust, along with other new trusts, has stepped back from future PFI proposals. It is one thing for a trust to make a PFI decision about one property that is under its governance, but it is another entirely when many properties suddenly come under that trust’s governance, and it realises that healthcare will be driven into crisis. If current proposed projects proceed, the Belfast Health and Social Care Trust alone will have to find £200 million per annum to pay the bill. That has happened in London where the Health Service has been driven into crisis in the past two years. Coupled with other features of the model that Shaun Woodward, the former NIO Minister, has imposed on us, it will drive us into crisis, too.

Mr Gallagher:
Thank you for your presentation, and thank you for drawing our attention to the serious situations in which hospitals will find themselves in the next few years if we continue on the current course.

Enniskillen is in the constituency that I represent, Fermanagh and South Tyrone. Therefore, as far as I am concerned, the time in which we can take action is running out quickly. Last week, the Minister of Health, Social Services and Public Safety attended a meeting of this Committee. We had a good meeting, and his response was generally good. When I raised PFI with him, he said that he would like a consistent approach to be taken to all such projects.

In the coming weeks, we will visit the Western Heath and Social Care Trust, which is responsible for the projects that are under discussion. It is disappointing to learn that the trust has refused to talk to you about certain serious issues. For example, its PFI arrangements would result in food being flown into Northern Ireland and taken by road all the way to the most western point of Northern Ireland, which is the Enniskillen site. Bearing in mind the problems that we have with our roads, that seems absurd.

The Assembly goes into recess in four weeks, and by August, the point by which we will be able to make changes in the tendering arrangements for the Enniskillen project will have passed.

I highlight the Enniskillen contract because the summer recess begins in a few weeks, and the Assembly will not be back in session until September. By August, the opportunity to change the tendering arrangements of that contract will have passed. Bearing in mind forthcoming Committee meetings, what aspects must be clarified about bed space in the new hospital in Enniskillen? How will patients’ catering arrangements be organised? Is a consistent approach more helpful than proceeding piecemeal?

Ms McKeown:
On consistency of approach, the new Minister has inherited a Department whose senior officials will not agree a proper protocol for this form of procurement. It is standard practice to have proper protocols. In the education sector, for example, such protocols were in place for PFIs. Although UNISON opposes PFI as a process of procurement, it nevertheless participates in the technical detail of the process to ensure that it is properly carried out. The Department of Health, Social Services and Public Safety has consistently refused that approach.

It has surprised me that the chief executive of the new Western Health and Social Care Trust has refused to answer our correspondence. I do not know why; I surmise that it may be due to pressure from DHSSPS. Unfortunately, as Dr Deeny knows, the former Sperrin Lakeland Health and Social Care Trust had four chief executives in as many years.

The trust has are all sorts of functional problems, and it does not have the level of expertise that we would want there to be in a complicated tendering process such as that in which the trust is engaged. Very bad mistakes are being made. I do not understand why, in those circumstances, the Department did not give the trust particular attention and support.

I emailed the chief executive again yesterday to ask why our correspondence had been left unanswered and to warn her that, in attending the Committee this afternoon, UNISON would raise the issue. It is unacceptable that a public body should fail to respond to a trade union that has rights in this process afforded to it by the Treasury.

Mr Swallow:
If the Department is reviewing all capital schemes, it must review the Enniskillen project, the Omagh project and all others with the same rigour. If that requires a small delay in the final invitation to tender, so be it. At present, the Enniskillen scheme is being shown all around the place as the touchstone PFI project for the industry.

My industry contacts in England have told me that English health officials have told them that, as there is not much work in England at present, they should tender for contracts in Northern Ireland and that they should fill in the gap in the market. That is not acceptable; we must get the process right.

My first point, therefore, is that the Department’s review of capital projects must scrutinise the Enniskillen project with the same rigour as others rather than showcase it around the place when it represents only marginal value for money. If that is not possible, it is compatible with the European advertisement for soft-service support workers — catering, domestic and laundry staff — to be excluded from the project. That is a precautionary approach. We are in a Health Service environment and the precautionary principle is a key element of Health Service practice. We should apply it in this case.

It is still possible for the Department to stipulate local sourcing and cooking of food in the contract. Furthermore, as I mentioned in my presentation, the Department can use young and local people on the project in order to develop employment opportunities. It is still possible to do that, but, as Tommy Gallagher said, time is running out.

Mr Easton:
I have been concerned about PFI projects for some time. It has been alarming to hear some of the statistics that have been given to the Committee. My impression is that, if PFI projects proceed, they will, in the long term, plunge health trusts into massive debt. If certain workers are included in PFI projects, will private-sector partners be able to dictate their workers’ pay and conditions, while other workers continue to work for the Health Service? Would it be better to keep health workers out of PFI arrangements?

Ms McKeown: 
We absolutely want workers to be kept out of any PFI arrangement. That has been done in Wales, where the National Assembly for Wales Government declared from the outset that no health worker would be involved in any form of privatisation or transfer. That is the model. We pointed out many times to the Secretary of State for Northern Ireland and for Wales that, ironically, he was Secretary of State for both jurisdictions and that we could not understand why what was good for Wales could not be good for Northern Ireland.

We already have many years’ experience of what happens when workers’ jobs are privatised. There are adverse impacts: pay levels drop; casualisation comes in; standards drop; and staffing levels drop. In fact, that is why the Health Service in Northern Ireland has now only one outsourced contract. All the other contracts have come back in-house precisely for those kinds of reasons. We recently received a commitment from the Belfast Health and Social Care Trust that the one remaining outsourced contract will come back in-house at the end of its contract period.

There are also difficulties if workers are transferred across on a form of the secondment model. The only such model in existence at the minute — it applies in the Health Service in England — was agreed to by UNISON because most of the affected services had been privatised and were not in-house. We agreed to that model because it was about trying to get people back in-house. If that model were to be applied here, the jobs of those who manage the seconded workers would also need to be privatised.

The workforce that we are talking about is 80%-plus female and is made up mostly of part-time workers. There are few enough supervisory- and management-career-type opportunities for women, but the secondment model would mean privatising the job of anyone who is already in that role. The model also stipulates that anyone who is successful in securing a promotion during the transfer would also need to move into the private sector.

I am not satisfied that sufficient guarantees on equality are in place, and I think that it would be in breach of the convention that is monitored by the United Nations Convention on the Elimination of Discrimination Against Women (CEDAW). The Government are signed up to that convention and are just about to be tested on it. The proposed system could be in breach of it because Governments are not supposed to introduce any system that would prevent the promotion of women. Although the grades involved are not those that people would immediately think of as high-level management or supervisory posts, we believe that support services need respect, which they have not been accorded over the years. Those are very important jobs.

Another adverse impact will be on incoming workers. We did not reach a conclusion with the outgoing Administration on a no-two-tier workforce agreement, which remains the subject of argument. A no-two-tier workforce agreement would protect the pay and conditions not only of those who transfer but of new starts. Such agreements are in place across the water, but they do not exist here as yet.

Including the staff in a PFI contract is not a solution to the problem but a sticking plaster. To allow the control of the staff to pass out of the hands of health and social services and into the hands of what are essentially building contractors is not an appropriate way in which to deliver healthcare.

Mr Swallow: 
If I were a contractor bidding for the Enniskillen and Omagh hospital projects, I would not get the tender unless I bid on the basis that I will take out 25% of the jobs. That is a major impact to start with. If I were the contractor bidding for the Ulster Hospital — if that goes to the market — I would not get the tender unless I bid on the basis that, for every three hours of domestic work that a worker currently does, he or she will now do four hours. Those are the models that have been used to establish value for money.

In that scenario, if my bid were now higher, value for money would not exist, and I would not expect DHSSPS to let the project proceed. If I were a contractor, that would mean that two years of my work had been wasted.

Therefore the factors that drive such projects are often presented using terms such as “worker protection”. However, evidence from Northern Ireland shows that the core issue is that workers are the price of the deal. Contractors can only respond to that in certain ways.

Mrs Hanna:
I do not believe that best value for money can be measured. I came to that conclusion during the previous Assembly experience, and many economists also seem to hold that view. In the Assembly’s first mandate, Members believed that there would not be enough money up front and that money would be required for front-line services. For all the reasons that you have mentioned, PFI was not predicted to offer value for money and would certainly not have been a faster option. Buildings that would be handed back after 25 years would have gone to wrack and ruin. Moreover, local workers would not be used and employment would be privatised. A meeting has been arranged with the Minister of Health, Social Services and Public Safety and the Department to tease out the concerns of many MLAs.

You mentioned a not-for-profit approach. Is that different?

Mr Swallow:
A not-for-profit approach would not involve the PFI model. A PFI consortium borrows money at substantial rates of interest and must use profits from the scheme to repay that interest. We have not seen not-for-profit PFI schemes.

Some people in the voluntary and community sectors reasonably think that they could build and operate a public service. However, that has not been part of the agenda. I have never seen — either in Northern Ireland or in England — a PFI model that substantially includes the voluntary sector. Sometimes that sector hangs on to the edge because it is involved in community consultation: that is not a problem. However, looking beyond the effective development of the public sector, PFI can be toxic to any progress that the community and voluntary sectors may make because it ties up money in lease payments and restricts the long-term availability of that money to fund initiatives that may originate in that sector.

Mr Buchanan:
I heard Jonathan speak previously in Enniskillen, and, similar to that occasion, he has given a good presentation to the Committee.

I have also always had grave concerns about PFI projects. On hearing of the potential consequences of the Omagh and Enniskillen projects, I believe that PFI would be no more than a millstone around the necks of people west of the Bann and that front-line services would be eroded in future years in order to repay capital.

I am somewhat alarmed to hear that the chief executive of the Western Health and Social Care Trust has refused to respond to any of UNISON’s correspondence.

If PFI is used in Omagh and Enniskillen, what long-term consequences do you foresee for health services west of the Bann? What will be the financial differential between borrowing money from the Exchequer and using PFI over 25 years?

Mr Swallow:
I would love to be able to answer the last question. However, to do so, I would require the full disclosure of the outline business case for the Enniskillen project. When that was handed to UNISON, it was covered in snopake — even the letters “PFI” were snopaked out. We were required to travel to the former Sperrin Lakeland Trust’s headquarters in Omagh to read the document under supervision. After three hours, they gave us a cup of tea and sympathy. That therefore means that we have only part of the picture.

The business case for the Omagh project clearly identified a revenue gap of approximately £20 million. However, it did not test whether conventional procurement models could use best-standard partnerships to deliver better results. Such mechanisms include the NHS ProCure 21 model, which is now working well, and the Latham Report and the Egan Report in the UK, which are being applied to the terminal five project at Heathrow Airport. The business case for the Omagh project simply tried to make the PFI sums stand up, and that is where we stand now. I am outside the wall crying a bit, and I wish that I could give you a more detailed answer.

Ms McKeown:
I cannot surmise why there has been no response. The chief executive, who was about to become the chief executive of another body when outsourced cleaning and catering services were finally replaced by in-house services at Altnagelvin Area Hospital last October, very much wanted to meet UNISON representatives to the future and the new trust. However, the silence is worrying.

The Strategic Investment Board and the Department consider the Enniskillen project as the flagship project not only for Health Service infrastructure but for all infrastructure projects. If that is the flagship project — given how fundamentally flawed it is — we have all got problems on our hands.

Mr Buchanan:
Are you saying that the PFI projects in Enniskillen and Omagh have not been as rigorously examined as others?

Mr Swallow:
From discussions that I attended with Ms McKeown, which included senior civil servants in the Department, I understand that the Green Book’s value-for-money status of the Enniskillen project was too close to call. In other words, no one was sure. My view, which has been echoed by comments that I have received, is that the project was therefore launched as an experiment. The Health Service is not a laboratory.

Dr Deeny:
I am getting my breath back after hearing that. I have worked in healthcare for my entire professional life. The effects of PFIs on the future of the Health Service concern me greatly. Those concerns apply not only to the healthcare sector; Balmoral High School in Belfast is an example of where a school has been failed by PFI. However, the Committee is here to discuss the health needs of the future.

An important point was raised not only about contracts, but that money will be taken from each trust’s budget in subsequent years. That money will disappear. I have been told that that will be like mortgaging hospitals, only worse. Hospitals will be at the mercy of the private consortium or individual.

You are quite right in what you said, Jonathan. I have not met you before, Patricia, although I have heard you on the radio. It is nice to be able to put a face to the name. I welcome you to the Committee. My questions might be asking you to repeat yourselves.

My practice has been identified as one of the new health and social care centres that will provide additional primary-care services. The situation concerns me greatly. I have been asking for some time, indeed just last week, why no progress has been made with our health centre. We have been on the hamster’s wheel — we are not going anywhere. I have since discovered why.

Is it correct that primary-care projects will be held back because of funding problems in secondary care?

For years, many employees in my hometown of Omagh have relied on the healthcare sector for work in either the hospital or the major mental health facility. Will the 25% cut in jobs be across the board?

Ms McKeown:
There will be a 25% cut in a range of support workers’ jobs: catering services; domestic services; orderlies; laundry staff; security and even the people who answer the telephones. How it possible to cut the answering of calls to hospital by 25% is beyond me. However, that is the proposal. The irony is that the catering and domestic services only came back in house last year after a three-year campaign. We exposed the fact that, for example, on a Saturday, only one domestic worker, who was a student from the local college, was on duty in an entire section of the Omagh County Hospital.

Dr Deeny:
That is a serious concern. What exactly did you mean by an equality assessment? I am gravely concerned that you have experienced what I experienced with the previous trusts in the west Tyrone area. I am alarmed to hear that the new chief executive is following in the same mode. That must be redressed as soon as possible. The Committee’s job is to scrutinise and monitor. That situation is certainly not good enough. I hope that it will be sorted out soon.

Is that likely to happen with primary care? A lot of my GP colleagues would be concerned about that. What exactly do you mean by an “equality assessment”?

Mr Swallow:
First, my understanding is that the four primary-care developments proposed for the Omagh area were originally included in the local hospital PFI contract in order to bulk it up. I heard that the doctors said that they did not want to be there, and I can understand why. Across Northern Ireland at the moment there are 25 to 30 ongoing projects, but in Belfast, using standard procurement methods, new health centres are now emerging on Shore Road, Antrim Road and Holywood Road without any difficulty.

The debate over the past year, as I understand it, is that the Department of Health, Social Services and Public Safety and the SIB want to consider whether another 25 to 30 projects should be undertaken using PFI or the NHS local improvement finance trust (LIFT), which would transfer the entire community-health estate to a company with a 60% majority private stake. That company would build those projects. The Department would have a golden share, if not for the fact that two years ago the European Union declared golden shares illegal, so that would make no difference whatsoever.

During the past year I have met regularly with the people who are supposed to be leading those projects. The trusts say that it is the job of the boards; the boards say that it is the job of the trusts. The boards and the trusts occasionally get together and say that it is the job of the Department, which instantly responds by saying that it is not its job. One year ago, we expected to see outline business cases. We have that right — and the right to comment — under Treasury rules, but we have seen nothing; those business cases have not been made. The latest row appears to be about whether it is the duty of the trusts or the boards to pay for the consultants.

Patricia will explain the issues regarding equality impact assessments.

Ms McKeown:
The equality impact assessment should not present any difficulties for the Department of Health, Social Services and Public Safety. Its obligations are laid out in section 75 of the Northern Ireland Act 1998, and the Department’s equality unit has been particularly good at promoting them. The concept of estimating and tackling inequality gave rise to the Investing for Health strategy.

There has been utter resistance to any kind of equality impact assessment of the proposals for projects in Omagh and Enniskillen, or for the community primary-care-centre projects. The assessment process is not rocket science; it is a defined process, which has been set out by the Equality Commission. Written guidance to the assessment process is available, and a pro forma is provided.

The public sector at large has been carrying out equality impact assessments since 2000, so it has seven years’ experience of the process. Models of good practice exist, and UNISON has engaged with those public authorities that have properly followed the process, notably the Belfast Education and Library Board (BELB), which worked to produce an equality impact assessment of the PFI proposals for the “second wave” of schools. That assessment resulted in several of the schools included in the original proposal being left out.

Once the proposals have been examined from the perspective of section 75 of the Northern Ireland Act 1998, the future holds bad news for schools that, having been included, might close in four or five years’ time, because the bill for the next 25 years still has to be paid, as happened to Balmoral High School. That was shown to be the case for several schools in Belfast, which, quite rightly, came out of the PFI process. Once an organisation is tied into the PFI process, there is total inflexibility, and payment will take 25 years. In addition, any changes that need to be made will have to be paid for as well. Even a change of use of the facilities will cost the public purse, in the form of the Health Service or the education and library boards.

Equality impact assessments can be made, but they are resisted because a properly conducted assessment can demonstrate that a project is not good value for money, nor is it good value for equality: it will not deliver good value for service delivery to ordinary people, and, rather than addressing health inequalities, it will compound them.

Ms S Ramsey: 
Thank you for the presentation. Everyone has mentioned the lack of documentation from the relevant people. Since the Committee will be in recess for the summer, it should contact the Department and obtain the information as quickly as possible. Like other, I have concerns about PFI and, although there is no evidence, it strikes me that things are being hidden. If so, why? The Committee should look to that.

Moreover, I am concerned, in general, about joined-up Government. In fairness, the Executive and the Committees have not been up and running for long; however, I am sure that the Department of Agriculture and Rural Development (DARD) will disapprove of local companies going to England, as local merchandise is not being sourced.

Wearing my other hat as Chairperson of the Committee for Employment and Learning, what scares me is that yesterday that Committee heard a presentation on those that are economically inactive and the pathways to work. Now you indicate that, through PFI, et cetera, there is no facility for local regeneration through apprenticeships or other training opportunities. That will impact not only on this Committee but on other Departments and their Committees. I should like to meet to advance the issue and argument of PFI on behalf of the Committee for Employment and Learning.

Ms McKeown: 
I welcome that. Some months ago, we met UCAT and DEL officials to say that the issue of procurement is recognised as not just building infrastructure or buying goods; it can do good. It can promote equality in local communities, it can create employment and it can challenge disadvantage. We came up with detailed proposals on how that could happen with, for example, apprenticeships in the construction industry.

The central procurement directive of the Civil Service has taken some of that on board. Two or three weeks ago, we met the procurement team, who stated that they wished to go ahead with those proposals; however, nothing of that has permeated the Department of Health, Social Services and Public Safety (DHSSPS). It does not appear as a contract clause anywhere. If it is not written in as conditions, or as part of the method, it simply will not happen. There is a real opportunity for the Department to do this, whatever method it employs to build or rebuild. The method of procurement does not matter, what is important is the fact that those things are possible. They are kept out of the PFI side, in particular, because anything that demonstrates that it might be the most costly means is eliminated.

Mr Swallow:
The presumption to disclose is subject to commercial confidentiality, but that must be exercised reasonably.

The Enniskillen PFI project document is so heavily censored as to be unrecognisable; I had to keep my wits and my calculator about me.

The Omagh document, on the other hand, was disclosed by mistake. It was 500 pages long, it took three hours to read, and I had my notebook.

The Royal Victoria Hospital’s document was disclosed — unfinished — at 10.00 the night before the trust board meeting. It was bizarre that at the meeting the next morning, the trade union, in making our presentation, advised the trust of the affordability gap when that had not been done by the board’s officers.

The Ulster Hospital’s document was so heavily censored that, in response to my evident frustration, its staff ran out of the room and brought me the real one.

That is no way to do public business. We have learned a great deal that is very disturbing; that was our reason for coming today. It is time that the Government faced up to workers as the price of the deal, and affordability gaps. If they review all capital schemes, those issues should be part of the review, and the Enniskillen PFI project should not be pre-empted, just to serve as a showcase to a wider industry.

The Chairperson: 
Thank you all for coming, and thank you to Jonathan and Patricia for such an interesting presentation. You have given us food for thought on the matters we raise. The Department of Health, Social Services and Public Safety will be here next week, DV, to discuss those issues.

Ms McKeown:
We will continue to supply you with every fact and figure that we have, despite the Department’s saying otherwise.

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