Published: 18 December 2009
Costly Social Experiment
Plans by Kingston Primary Care Trust (PCT) to hive off NHS services into a social enterprise could cost nearly £600,000, Unite, the largest union in the country, has claimed.
Unite believes that the money - £4 a head for Kingston’s population – to set up the social enterprise could be better spent on services, such as speech & language therapists, health visitors, physiotherapists and community nurses.
Using a Freedom of Information request, Unite has discovered that:
· £181,000 has been spent in 2008/2009 on becoming ‘an autonomous provider’ and ‘business ready’ organisation
· A further £79,000 has been earmarked for this ‘externalisation of provider services’ for 2009/10
· If the social enterprise is not eligible for VAT refunds for the purchase of goods & services, the additional cost will be £300,000. The NHS is currently exempt from VAT
· £18,000 has already been spent on ‘marketing & branding’ for the proposed social enterprise, which will be a commercial organisation, able to win – and lose – contracts to provide services to the NHS for a limited period of time
Unite is fighting the creation of the social enterprise – a body one step removed from the NHS proper - as it contravenes Health Secretary Andy Burnham’s recent policy announcement that the NHS is ‘the preferred provider’ for services.
Karen Reay, Unite National Officer for Health, said:
“Given the relatively small 150,000- strong population of Kingston, the sums that the PCT is spending on promoting the market dogma of the social enterprise is staggering. We estimate that possible expenditure is £578,000 – and still rising.
Money that could be going on services, such as speech & language therapists, is being spent on management consultants and the bureaucracy to create the structures for the social enterprise.
We have repeatedly asked the PCT management to hold a ballot of staff on all the options for the future, but they have adamantly refused to go down the democratic route”.
Unite is concerned that if the social enterprise loses its contracts to, for example, a North American private healthcare company in five years time, jobs could be lost and services to the Kingston public could become fragmented.
The ethos of a NHS providing a unified, joined-up service for patients could disappear.
Karen Reay continued:
“Social enterprises will mean the fragmentation of services; and the employment conditions and pensions of NHS staff being eroded, or even lost”.
The viability of the financial model proposed could be jeopardised, if VAT is charged on its services not directly related to health care (such as marketing & legal fees) and treatments that may not be regarded as essential.
Further information
Health B4 Profit campaign
The 'Patchwork Privatisation' of our Health Service: A users' guide
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Social Enterprise by Democratic Choice or Central Diktat
United in Demand for Ballot
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