UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE To be published as HC 991

House of COMMONS

MINUTES OF EVIDENCE

TAKEN BEFORE

HEALTH COMMITTEE

RESPONSIBILITIES OF THE SECRETARY OF STATE FOR HEALTH

Wednesday 25 July 2007

RT HON ALAN JOHNSON MP and MR HUGH TAYLOR

Evidence heard in Public Questions 1 - 115

USE OF THE TRANSCRIPT

Oral Evidence

Taken before the Health Committee

on Wednesday 25 July 2007

Members present

Mr Kevin Barron, in the Chair

Mr David Amess

Charlotte Atkins

Mr Ronnie Campbell

Jim Dowd

Sandra Gidley

Dr Doug Naysmith

Dr Howard Stoate

Dr Richard Taylor

________________

Witnesses: Rt Hon Alan Johnson MP, Secretary of State for Health, and Mr Hugh Taylor, Permanent Secretary, Department of Health, gave evidence.

Q1 Chairman: Good morning. Could I welcome you to the Committee and could I ask you if you would introduce yourselves and the positions that you hold.

Alan Johnson: Good morning, Chairman, it is a pleasure to be here. Alan Johnson, Secretary of State for Health, and Hugh Taylor is my Permanent Secretary.

Q2 Chairman: Welcome to this first and, I hope, most enjoyable session that you have, Secretary of State, with the Health Committee. I realise that you have not been around that long just yet, so how much detail we will get to this morning, we will have to wait and see. There are just one or two questions around the Darzi Review of the National Health Service, which was your first public announcement of what is likely to happen. Why is the review necessary now? Are the Government really abandoning the analytical framework and vision produced by the Wanless Report and the NHS Plan?

Alan Johnson: Well, no to the last two questions. Why are we doing this now? Well, it is a new Government, we are coming up to our CSR in health and next year is the 60^th anniversary of the National Health Service. I think it is a marvellous coup to get someone like Ara Darzi as a Minister in the Government and we think there is a job to be done. Given all those circumstances, the new Government, the CSR, the 60^th anniversary next year, and given the obvious kind of mismatch between perception and reality in the NHS, ie, the reality of improved patient outputs, one million more operations every year, 50,000 lives saved on cancer alone, record levels of investment, patients telling us in the recent Healthcare Commission survey, 92%, that their care was either excellent, very good or good, so you have all of that and much more over there, but you have got a negative perception amongst the public and, in particular, you have got a feeling, I think, of the staff that the changes that have taken place and which have led to better outcomes, things have been done to them rather than with them and there is a real issue there about morale. If we take all of that together, I think it is really the time to have this, what we are calling, 'next stage review' of how we build on the investment and reform to go to the next stage of the NHS journey and do that by really involving people, not just patients of course and the public, but people working in the NHS, and we just think that Ara Darzi is the perfect person to lead it.

Q3 Chairman: If this negative mood that you mentioned in the statement on 4 July was because things have been done to people in the National Health Service and not with them, is this about restructuring and would you not fear that the review may bring exactly that back on to the agenda once again and that restructuring might be an issue, even if it is just at the local level and not the sort of national restructuring we have had? The mood will not go away if that is the case, will it?

Alan Johnson: Well, it is a perception amongst the staff that this has been done to them rather than with them. Going back to your question about the NHS Plan, there was a real feeling in 2000 that the NHS Plan had been arrived at by a process of proper engagement and that is why the NHS Plan still remains. All of what we are doing stems from the NHS Plan still. I have ruled out any more top-down restructuring, so that is PCTs and strategic health authorities; we are not going to restructure those again. That is out of the way and I think once you put that out of the way and you say, "Look, this is not about any organisational restructuring, this is about improving care for patients and, yes, there'll be some functional restructuring" because that is what you have to do to improve patient care, but, if you make it absolutely clear it is not about organisational restructuring, I think it helps in the process. When we talk to staff when the process is already under way, and in fact Ara Darzi is today in Manchester and was in our neck of the woods yesterday, I would be very, very surprised if, as a result of this engagement, people say that there needs to be a structural review. I think the one thing in that statement that had absolute unanimity and perhaps a sigh of relief was that there was going to be no more structural reorganisation for the foreseeable future which, as far as I am concerned, means as long as I am Secretary of State.

Q4 Dr Stoate: How do you explain how we got into this position? As you said, we have had record investment, record improvements in healthcare, record falls in cancer and heart deaths, record numbers of operations, record numbers of staff, yet the public perception is pretty poor and morale in the Health Service is poor. How did we get into this position?

Alan Johnson: It is a very good question. If you want my bit of cracker-barrel philosophy on this, there was an issue which my predecessor had to deal with and she dealt with it tremendously well; I am a huge admirer of Patricia and what she did. We had to go from a situation where, although we were putting more money in, trebling the amount of investment in the NHS, there were PCTs that were in deficit and were in deficit year on year and were selling off bits of capital and using it as revenue, all kinds of things going on out there that needed to be tackled and, as part of tackling that, that obviously had ramifications for staff morale. I think if you are talking about structural reorganisation, probably we could have a bit less structural reorganisation. There was the stuff around Sir Nigel Crisp's letter, which you will be more au fait with than me, which kind of made everyone working in PCTs think that their pensions were at risk, et cetera, and there was an issue about pensions which I dealt with in another capacity, not just affecting Health Service workers, but affecting civil servants and teachers as well. If you put all of that together, if you add to it things like MTAS, if you add to it the undoubted problems caused by the pay deal this year, that all leads to that kind of climate and you have also had a number of issues which are driven by better healthcare where clinicians have said that, because of improvements in medical science, new technology and changes in demography, we need to do things differently, the dreadful word "reconfiguration" and that has been actually hyped up into something that is perhaps coming top-down rather than bottom-up, but, for all those reasons together and probably a few more, we have got the problems we have got at the moment.

Chairman: We may want to touch on one or two of those things during the morning.

Q5 Mr Amess: Many congratulations on your appointment. You are now the fifth Secretary of State that I have had the opportunity to put questions to while being on this Committee. I am not going to share publicly the views of your four predecessors, but I do think that the first Secretary of State for Health, Frank Dobson, appeared to be very, very closely aligned with the people who worked for the National Health Service and that was much appreciated. Now, in your opening remarks, you have talked about restructuring, no more changes and you know that the last thing people want is further turmoil. I have had sight of something from the GMB where they say, "It has actually been the darkest of years, not only for this Trust, but for the NHS as a whole, this Trust having been caught somewhere between poor government policy and even poorer management who seem intent on making the simple seem difficult. This week alone I have had two members, Trust employees, physically distressed over the lack of care shown towards them". Now, that may be an isolated example that, as a politician, I have plucked out, but, without morale, there are problems. I know you have praised your predecessor whom I have got the highest regard for, but just a few weeks ago when your predecessor was sitting there and we put questions to her, she was very, very robust on any number of issues which probably we will be coming to later. Now, I wanted to touch on the point of necessary reforms, but I have got to get this off of my chest about Lord Darzi, and I do not know the gentleman, a splendid individual. All I would say is that I think that these political parties having non-politicians as ministers has not in the past proved a success, so, if it proves successful this time, we will be opening up new ground, but we will watch this space and I wish you well with the journey. As far as these necessary reforms before a period of stability are concerned, you have stated that further restructuring is to be avoided. What is likely to be the nature and extent of these necessary reforms?

Alan Johnson: Well, the necessary reforms we know about because, if you take stroke care, for instance, there was a report by Roger Boyle just a couple of weeks ago, building on the NAO Report and the PAC Report in 2006/07, and it is also mentioned in the London Report where we have the opportunity now not just to save people's lives by ensuring that they are properly scanned, but, if it is the correct treatment, to give them these clot-busting drugs very quickly, which means they have to be seen in three hours, so we have the opportunity to save people's lives and the people, who are permanently disabled by strokes at the moment, are able to walk out of the hospital and lead a normal life. We cannot just leave that in abeyance, but we have to change things around which means more specialists centres, which means paramedics being empowered to take patients not to the nearest hospital, but to the hospital which has got 24/7 specialist care. These things are happening at the moment and I think what we need to do is to separate away the organisational restructuring which I have said will not happen. That does not mean to say there is a moratorium on dealing with the situation we face in the 21^st Century. I think that Lord Darzi's review, and I do not agree with your point about people coming in from outside not being successful ministers because there are examples of people who have come from inside and not been successful ministers, but, as far as Lord Darzi is concerned, I do think there is a certain beauty even in someone of his stature, an eminent physician, continuing to operate free of charge incidentally for the NHS two days a week, a political operator in every sense of the term, conducting this review where people are genuinely engaged in the debate about what the NHS is 60 years on and how we enshrine its values but make it applicable to the age we live in, and then, being a minister in the Government, looking to carry this through. We have had things like the Turner Report on pensions, we have had things like the Leitch Report on skills and the report comes to you and then the person who has actually been responsible for it kind of lets go of it, whereas with this, I think there will be a real symmetry. I think this is a really good opportunity to have a debate where the staff really do feel engaged because this is a major part of what this is about. It is saying to the staff, "We really do value and respect what you are doing. You have transformed the NHS and let's hear what your concerns are, let's hear your ideas for how we can take these things forward", because the one thing in my wealth of experience now, just coming up to four weeks, is that when you talk to people at the front line, they are the people with the ideas and they are as passionate about patient care as anyone and it should not be me dictating this or Hugh from Whitehall, it should be them doing this in a collegiate way not just with Lord Darzi, but with the huge team of clinicians who will be working with him on this review.

Q6 Mr Amess: Well, thank you for your responses. I am not going to pursue the Lord Darzi thing and the necessary reforms; you have given a little example with stroke and I think we will just leave it at that. We can remember when Baroness Bottomley had radical plans for the reorganisation of healthcare in London. Now, if you are presented with the radical plans in terms of London, and we all know the fierce loyalties, this is a hypothetical question which you are perfectly entitled not to answer, if you are presented with radical plans again, will you bite the bullet?

Alan Johnson: What, for London?

Q7 Mr Amess: Yes.

Alan Johnson: There are radical plans that have now gone to NHS London and the fact that it is one strategic health authority for London is a good thing and they will now be looking at that and consulting on that, but what, I think, you are referring to is not just Baroness Bottomley, who is the Chancellor of Hull University and, therefore, sainted, in my view, but other reviews have come along. In fact, Lord Darzi says in the foreword to the London Report that there are three or four reviews which have been done and just gathered dust on the shelf. I do not think this one will, but that is not a matter for me, that is a matter for NHS London.

Q8 Mr Amess: I was on the committee stage of the Bill that introduced primary care trusts and we all know that, whoever the Government of the day is, they do not accept amendments, we know the way it works, but, I have to say, everything we said during the committee stage has unfortunately come true. It does not matter where you look in the country, there are umpteen vacancies for chief executives of primary care trusts. In my own area, we had a splendid person and she was drafted into another area to support them and we could not get a person to replace her and now we have got no one at all, and this is happening right throughout the country. Given that these are absolutely at the core of delivering healthcare, and I know that after four weeks it is a bit of a tough question, but I wondered if you did have any bright ideas. I have been asked to put specifically the point: will the review be able to consider the reorganisation of the commissioning bodies, for instance, the merging of small primary care trusts, such as Hartlepool or Darlington?

Alan Johnson: I am not aware of a huge problem in the recruitment of PCT chief executives, but Hugh might want to say something about that. Certainly that is not the case in my own area. We are saying no top-down reorganisations and, as I understand the situation with Hartlepool, it was reviewed when the emergence of PCTs was going on and it was accepted that it should be a stand-alone PCT. Now, if something changes in the North East and in that area where people are coming to us to say, "Actually it is no longer viable as a PCT", and, as far as I know, there is absolutely no sign of that, I think people are very happy with Hartlepool being a separate PCT, we are not going to impose any change. Any change has to be bottom-up if it is coming structurally to PCTs and it will not be coming top-down.

Q9 Mr Amess: Does Mr Taylor have any comment about the recruitment of chief executives?

Mr Taylor: Well, the sheer scale of the changes over the last 18 months or so has meant inevitably that there have been periods of vacancies and issues about people leaving post to go elsewhere, so there has been turbulence unquestionably, but I do not know about specific instances.

Q10 Mr Amess: Ours is well-known in our area and we have reached a point where they say they cannot attract anyone for £140,000. What on earth is going on?

Alan Johnson: I might put in for it myself! That would tempt us all!

Q11 Jim Dowd: I do not think you would get it!

Mr Taylor: More generally, I think, and this is one of the issues that I know David Nicholson is personally committed to sorting out, it is very, very important that we get strengthened leadership capability across the NHS and there are a number of initiatives which he is taking forward to do that and it is important not just at primary care trust level obviously, but across the board, so the particular circumstances of your primary care trust, I am not particularly aware of, but I do know that there is a big drive on to build up capability and indeed not just to strengthen the sort of general management cadre, but increasingly to encourage clinicians with the right skill sets to apply for chief executive posts, and there is a particular programme aimed at doing that.

Q12 Mr Campbell: I am pleased to hear you say that there is not going to be any more reorganisation because I think it is right what David says and I think that the people in the Health Service are just fed up with getting shoved around and pushed around all over the place. That brings me to my simple question which is about a constitution. You have mentioned something about a constitution for the Health Service, but what form would this take?

Alan Johnson: Well, I think that is a matter for the review to determine. What we have said in the terms of reference is that this could be an opportunity. It may not and nothing may come of it, but it could be an opportunity to feed into a constitution for the NHS's 60^th anniversary. I guess it would look kind of something like the ten core principles of the NHS Plan and it would seek to enshrine the NHS principles that have been there since 1948, but then look at how the NHS can work in the 21^st Century, so the issues around providing patient care, clinician-led, locally driven, all of that might emerge as something we could put in a constitution as a way to kind of have a little anniversary party for the NHS and which could actually be something which would then guide the NHS over the coming years, so that is the general idea. We have not got a blueprint of how it should look; indeed that is why it is part of the terms of reference for the review because that should be what shapes it.

Q13 Mr Campbell: Would that rule out the independence of the Health Service, this new constitution?

Alan Johnson: This is the argument about whether we should set it up as an independent body. I am not convinced by that argument, neither was my predecessor who said in her last speech to the LSE why that was unlikely. Let us see what comes from the review. I think it is very unlikely that would happen. I think politicians, whether we like it or not and I do happen to like it, are always going to have to have a responsibility for the NHS.

Q14 Mr Campbell: It is certainly not going to upset the people on the ground when you have this constitution.

Alan Johnson: It is actually their involvement that will drive it and, if we succeed with this at all, it will be because ----

Q15 Mr Campbell: It will be the feedback from them.

Alan Johnson: It will be the feedback from them, absolutely.

Q16 Chairman: On that point, the founding father of the National Health Service, Nye Bevan, 60 years ago allegedly said that, if a bedpan is dropped on a ward in Tredegar, the noise of it should be heard in Westminster. Do you agree with that at the beginning of the 21^st Century?

Alan Johnson: I do not know whether bedpans are as prevalent now as they were back then. No, I do not agree with that because, if a bedpan is dropped on a ward in Tredegar, then the local trust and the strategic health authority should be knowing that there is a problem with dropped bedpans. I think the whole point, and this is David Nicholson's point, and David cannot be here today because he is with Lord Darzi, but his constant message in the nine months he has been in office has been to the Health Service to look out to their patients, not up towards Whitehall. I think part of that bedpan-dropping in Tredegar is a kind of cultural thing, and I am not blaming anyone in the NHS for this, this is the way the system is run, that they are always looking up for the next directive that is coming down from Whitehall which is why I think probably, going back to the question about a new constitution, you could enshrine that probably as something that has changed over the last 60 years.

Q17 Jim Dowd: What do you make of the recent publication by the BMA, and I paraphrase it, but effectively it says that we should just let doctors run the Health Service and they should just send us the bills?

Alan Johnson: I think it is paraphrasing it a little bit. I want to work with the BMA. I met Hamish Meldrew who came into post on exactly the same day as I did just a couple of weeks ago and I want to work with him, and I would be very surprised if the view was that stark. We have issues to resolve. Yesterday, I announced a series of measures following on the GP survey where we will work together with the BMA to look at the quality outcome framework to see how we can change that around to meet some of the issues that arose from the GP survey, and the BMA are very keen to work with us on that, so I am working with people and, given that we have the same ambitions and the same goals, working with them to achieve those goals.

Q18 Jim Dowd: If I can then move on to the main thrust of my questions which follows up something which David mentioned earlier about the piece of work that Lord Darzi has already completed, namely the London Review, and I put it to you quite bluntly, if his recommendations were to be implemented, how many acute hospitals in London, do you think, would be closed?

Alan Johnson: I do not think any would close and I do not think any accident and emergency departments would close incidentally really because the problems that he is relating to are about increased population, about London being under capacity and that it has a growth of, I think, between 4% and 8% a year coming through. There were a couple of newspaper headlines on the day it was published, saying, "Hospital closures", but the words "hospital" and "closure" are not used in that report and indeed five or six clinicians the next day, led by a woman called Cathy Warwick, the visiting professor of midwifery, and a number of GPs wrote to the newspapers to make this point, saying, "Look, we're not going to have a sensible debate about this if we don't look at the issues that this review throws up". The issues, as I understand it, for London are: 54% of GP practices have either one or two GPs compared to 40% around the rest of the country; they have doctors in large, acute hospitals seeing 24% fewer patients than their counterparts in other large hospitals; you have got this incredible health inequality illustration that, if you get on the Tube here at Westminster and go eight stops down to Canning Town, your life expectancy will go down by seven years; and you have got this issue that, whilst Londoners want more community care and they say so over and over again, 97% of outpatient appointments still take place in a hospital. As well as that and the very important reference to stroke care that he raises as a priority, those problems have to be resolved. It will not mean, in my view, the closure of any hospitals and it will not mean the closure of any accident and emergency units. It will mean a difference in those hospitals and a difference in those accident and emergency units with more specialist care being available, and that is for the good of everyone, in my view.

Q19 Jim Dowd: But surely these considerations should be driven by considerations of levels of service, not necessarily a fixed number of institutions?

Alan Johnson: Yes, I agree, they are. If you are referring to the reference to the numbers of polyclinics, et cetera, it is a matter for NHS London to take this forward in consultation. I think what the review does in a very, I think, exciting way, and I talk as someone who has grown up in London and is a Londoner and knows some of the health problems first hand, what he does is kind of inspire people to say that, if you follow the life cycle through from birth to, what we call in the dreadful American term, end-of-life issues and you look at that right the way through what it means to people in London, you can find a new way of doing things. Illustratively, he puts in issues around polyclinics and, illustratively, he puts in issues about the need for specialist centres for stroke, for instance, but that is in a review and where that goes to in consultation might be something completely different.

Q20 Jim Dowd: I am grateful for that because particularly in my part of south-east London there is a wide degree of concern as to the future of some of these hospitals. If I can just try to define that a bit further, The Guardian reported Lord Darzi as saying, which is not necessarily to say that he said it, "I don't think there will be any closures of hospitals", and went on to say, "Our analytical work suggests that what we need is to redefine the functions of buildings over the next decade", so, as you say, there are no hospital closures, it is just that there will not be hospitals anymore.

Alan Johnson: No, I am saying exactly the same thing. Actually, this is not about bricks and mortar, it is about the services for the patient, but I think his quote is absolutely right and we might redefine what that centre is being used for. If you take King's at the moment, which has an excellent stroke centre which is now achieving 24% on thrombolysis when the average in this country is less than 1%, what does that mean? That means that King's as a stroke centre, if I, God forbid, have a stroke tomorrow and I am in Croydon, I will want the ambulance to take me past St George's, not to Tooting Hospital, but I would want it to come to King's Hospital to treat me and that means that, if you do that and you look at that for heart care and cancer care and all the diseases where there have been these huge advances in medical science, the buildings will still be there, the hospitals will still be there, but they will be doing different things and they will be doing it on the basis of an integrated, across-London strategy to save lives.

Q21 Jim Dowd: You have mentioned previously that there have been a number of reports which, you say, just gathered dust and that is particularly true of reorganising health services in London. Is it not the case that we still have certainly a pre-NHS pattern of acute care in London, some would say even 19^th Century pattern of healthcare, and that we have never been bold enough in addressing the issues of over-provision or duplication and the immense power of some of the London acute hospitals?

Alan Johnson: Well, you would know this first hand, but I think there is a lot to be said for that. Healthcare has improved in London and there are lots of great GPs doing lots of good things in London, but the report sets out what the problems are vis-à-vis not a comparison with the rest of the country and some of the statistics I gave, but also saying that more people's lives could be saved in this great city if we really had the kind of transformation of previously the Turnbull Report which I have looked at and reports before that, but nothing really happened. Now, because we have got a London strategic body, London-wide, and we have got the political will and we have got, I think, a very good report setting us in the direction, there will be tough issues to get round, and you have mentioned some of them in south London, but, if we let this gather dust, I think it will be irresponsible. Having said that, of course it is for NHS London to look at.

Q22 Jim Dowd: Sure. Can I just say that I, like you, welcome the fact that there is a single SHA for London. I am disappointed that you have set your face so clearly against further restructuring because the other fact in London is that there are far too many PCTs, but what you are saying is that that is just going to have to stay the case.

Alan Johnson: No, it is bottom-up. If London decides there are too many PCTs and the London Strategic Health Authority decide this and it comes bottom-up, that is a different thing. We are not imposing anything from the top. If people locally are happy with the PCT structure, and it is the same coming back to the Hartlepool question, it will continue in that way.

Q23 Jim Dowd: Can I just look at the question of disposal of assets. If no hospitals are closing, this may be a redundant question, but certainly the Prime Minister, in response to questions about the draft legislative programme and our proposals for housing, did in fact mention the disposal by the Department of Health of surplus estates. Have you any plans to do that in London particularly where of course they would tend to be the ones that produced most revenue?

Alan Johnson: The Prime Minister's comments were not in the context of closing hospitals. What he was saying is that, in order to go ahead with this hugely ambitious house-building project, we need to identify where the public sector has land available. The Ministry of Defence are doing it, every single government department is doing it. We are being asked to do it as well and we are identifying that available land. We are not saying, "And a bit more land would be available if we closed these hospitals", but it is the land that is available now that we are looking at.

Q24 Jim Dowd: Finally, can I draw you back to Lord Darzi. Something he did say again in The Guardian on this subject is, "I'm not suggesting we sell the family silver...but creative enterprise can raise a lot on the back of those assets". What does that mean?

Alan Johnson: You had better get Lord Darzi in front of you to ask him!

Q25 Mr Amess: Can I just put a very quick point. My colleague, Lee Scott, who is new on the Committee, he wanted me to put something to you and would not expect you to have the answer, but perhaps you could get someone to write to him.

Alan Johnson: So someone who is not here wants to put something to me that he does not think I will have the answer to!

Q26 Mr Amess: Okay, I, as a Londoner, will put this question to you. If in the future you are yet to make proposals and consultation will happen in the autumn, the Member of Parliament for Ilford North and King George's Hospital, which I know extremely well, the ambulance drivers have been told, because of pressure, to take patients to Queen's in Romford and not to King George's. Now, I think you know there is a considerable amount of distance there and this has got to be wrong. I have got relatives in the area, so all I am asking is: could someone kindly find out what on earth is going on?

Alan Johnson: To contact you or Mr Scott on that?

Q27 Mr Amess: Yes.

Alan Johnson: Okay, sure.

Q28 Dr Stoate: You gave a very good answer earlier on as to why you felt NHS morale was so low and I think it is very brave of you to open up to the fact that, frankly, we have been part of the problem in terms of NHS morale within the Service and I think that is honest of you to admit the causes of that, but it does not entirely explain the reason why the public morale seems to be so low. I just wondered if you had any thoughts of how it is that the public perception of the Health Service is still depressingly poor, given the record that you have laid out about the improvements in the actual service.

Alan Johnson: That is a very good question, particularly on the back of the two surveys, the one I mentioned from the Healthcare Commission which showed 92%, and this was 80,000 recent inpatients, so it was a big survey, saying that they thought their care was excellent, very good or good, and we have also got the Commonwealth Fund which looked at six developed countries, including the UK, and we came out top overall, top on efficiency, top on quality and top on fairness, so why is this? This is the gap between perception and reality. Once again, this is just my feel for this from talking to people in the time I have been in the job, but there is a feeling that, "Yes, my hospital's fine and my healthcare's fine, but it must be bad everywhere else in the country", and there is still, I think, something in the back of people's minds about what is happening with long waiting lists and all the rest of it. Waiting lists now are not a political issue, but I think somewhere in the psyche that is still there. That dreadful word "reconfiguration", if you were in my neck of the woods in Yorkshire and Humber and you read in the newspaper that there was going to be a third of jobs lost from Scarborough NHS Trust, which was the headline in the newspapers last week, then that immediately makes you think that things are bad in the NHS. Now, that is not even something that has been put forward as a firm proposal, but this kind of headline, this kind of news, I think, seeps into people. All that stuff through that year or two years actually of turning around deficits to surplus and of getting PCTs to act within their means was a difficult time and that generated a lot of negative publicity, and I am not blaming the media for this, they were reporting stories, and there has been a bit of political opportunism around that which I will not stray into. However, I think all of this gives this message to patients and the public, which is why the public are a very important part of this review as well because we have talked about the need for the staff to be engaged, but the patients and the public need to be engaged as well because all the evidence is that the public would kind of naturally go for a status quo situation. If you ask the public, and it is actually in the London Review, "We've got more money, where should it go?", they would say to existing hospitals, 58% of them, I think, would say to the existing hospitals. When you engage the public in a discussion and say what is happening with stroke care, cancer and heart care and all the rest of it and you have had at the end of the discussion only 24%, I think it says in the report, who think it should go to where it is currently located and the rest, the large majority, agree with what is happening now which is that you actually need to move things around to give better care to patients, I think there is an issue there about engaging the public in the debate here.

Q29 Dr Stoate: You see, that is the problem because we are making these reforms and putting up these suggestions for completely transforming healthcare in London, but we have not even yet convinced the public of the need for it, so it just strikes me as so depressing that we have come forward with what look clinically like excellent reforms, and you have mentioned the improvements in stroke care, you have mentioned the lives saved, but the public just do not seem to get it. That surely has to be largely the responsibility of the Government to make sure that the public does get the reforms before we make radical changes to the Health Service?

Alan Johnson: Of course what we have got here is a review by Lord Darzi - sorry, not here, but wherever it is - into London which will now be followed by the Strategic Health Authority deciding what to do next with that. If they, and I very much hope they do and I have no doubt they will, decide to move forward on that, then that means consultation with the public. It would be, I think, a bit bizarre to have a consultation with the public about just a general idea about what you want to do with health without having specifics as to what it means. I think that that report sets out services focused on individual needs and choices, localised where possible and centralised where necessary, truly integrated care and partnership working, maximising the contribution of the entire workforce, prevention better than cure and this issue about the focus on health inequalities. They are the five areas set out in that report and that means now that that can be taken in order to have a real and proper debate with the public. I think you are absolutely right, that we have fallen down perhaps in engaging the public in these huge questions about where we go and I think that is another reason for the constitution. Once we are absolutely clear that it is not about structural reorganisation and the NHS will be what it has always been, free at the point of use, giving universal healthcare, and it is not an ideological battle, because too often people think this is all driven by ideology, and then you just concentrate on how we can improve patient care and stop people dying unnecessarily, you will get a public buy-in to this.

Q30 Dr Stoate: One of the main platforms of the reforms in London, in particular, is the formation of polyclinics. Now, I am in favour of polyclinics and in fact I suggested this some time ago in a pamphlet I wrote for the Fabian Society, so I am really pleased that the Government is reading the Fabian Society pamphlets and picking up on some of my ideas; that is very welcome. However, there is clearly an issue around polyclinics and how they work. In this country, they are largely untried, untested and unknown about. What work has been done on the cost-effectiveness of polyclinics? Do we know, for example, how much they are going to cost and what impact are they going to have on existing services in the communities which they will serve?

Alan Johnson: Well, I really would like to suggest that you perhaps get Lord Darzi to talk to you. It is not my proposal on polyclinics and London, and this is a very important point, is not a blueprint for the review around the country. The last thing we need is people in Gloucestershire or Worcestershire or in Hull thinking, "Oh, this is London's blueprint now to be imposed on the rest of the country". There is a kind of accident of timing here, that Lord Darzi was doing the London Review and then he was appointed to the Government and then the London Review was published and we announced that we were going to do a review across the country, so this idea of polyclinics is something that Lord Darzi and his colleagues have come up with and it may or may not be something that will be looked at elsewhere, but I really think you need to talk to him about that rather than us.

Q31 Dr Stoate: But, as you said, politicians have to keep a hand on what is going on. One of the criticisms of the Darzi Report in relation to polyclinics is that they failed basic accounting and business tests in order to repeat the untried model. Surely, that must be of concern to you, as Secretary of State?

Alan Johnson: Well, that is Nick Bosanquet and the reform group who are saying that and they have a specific view of these things. Actually, just looking at some of that criticism before this Select Committee hearing, I think it is very unfair on Lord Darzi because he does talk about patient choice, big time, and he does talk about these issues around commissioning. In fact, he has a whole section on the importance of commissioning and practice-based commissioning in particular, and he would say, were he before you, Lord Darzi, that actually he was not meant to be producing a business plan in that, but he was developing an idea that actually, operating in places like Hounslow, there are these ideas out there, and your Fabian pamphlet led the world on this ----

Q32 Dr Stoate: Thank you very much!

Alan Johnson: ---- but he was not suggesting that this would all come with a business plan. He has produced a report which then goes to another stage and I think it is quite unfair to criticise him on the basis that it is not all costed out. That was not in his terms of reference, although he does make the point that actually there are economies here as well, but he is driven by patient care.

Q33 Dr Stoate: Obviously, but clearly you understand that it will have impacts on local services and of course GPs and others who will be working in them clearly have an interest in how they will function in their area, so that is being taken care of, but you feel it is more Lord Darzi's responsibility to give us the detail on that rather than you?

Alan Johnson: Yes, because it is not my suggestion. We are not sitting here, suggesting that polyclinics are the answer to everyone's problems across the country; it is a specific London issue.

Q34 Dr Naysmith: Secretary of State, it is a pleasure to welcome you to this Committee which I hope will be the first of mostly enjoyable experiences for you here!

Alan Johnson: I doubt it!

Q35 Dr Naysmith: I am glad to hear what you said about polyclinics not necessarily being rolled out elsewhere because that was going to be the start of my questions really. You are really saying that we need to get Lord Darzi here to talk about polyclinics?

Alan Johnson: To talk about polyclinics in London because he has looked at this just in London and I think you need to question him because he is going to conduct the review around the country and personally I can see a case for polyclinics in big cities, but they do not have the same problems in other areas as London, they do not have the same priorities and they do not have the same healthcare issues, so that is why I think it is an issue that we should just confine to the London Report at the moment.

Q36 Dr Naysmith: I certainly agree with you. Too often, things that seem to work in London get rolled out elsewhere without really being looked at closely. The suggestion about polyclinics has been tried before in Warrington and earlier this year the IVF collapsed completely because everybody opposed it, MPs, doctors and the public, and they said they did not want a series of five polyclinics for Warrington. Have you and Lord Darzi learnt anything from that?

Alan Johnson: I cannot speak for Lord Darzi and I certainly did not know anything about it until you just mentioned it, but that is obviously why, when we go out across the country and we engage with clinicians, these kinds of issues will come up. It is tempting to think that this nation-wide review is going to be London on a bigger stage, it is not, and, as Lord Darzi will tell you, London was London and he is going out to listen to what is happening around the country. If polyclinics are not the answer in one part of the country, and this is the important reason why this has to be bottom-up, but maybe are seen as the solution in other parts of the country, well, that is what will emerge from the review.

Q37 Dr Naysmith: If I can pick up something you said earlier, you were talking about stroke units which is something that I am interested in as Secretary of the All-Party Stroke Group, but you were talking about having really specialised units that will do scanning, people having clot-busting drugs and everything all within three hours. Now, that must reflect on what you were saying earlier about the future of large hospitals because we cannot have ten or 12 of these units in London because you just would not have the scanning facilities and so on, so it means concentrating down and specialising and that means that current large district hospitals will not all have these very specialised stroke units.

Alan Johnson: No, that is true, but it would not mean that they would close or that they would not have other work to do. What happens at King's is that there is a triage nurse working in accident and emergency, there are paramedics across this part of London, south London, geared and empowered to take patients straight to King's and there is a very good stroke centre at King's. Now, that has not led, as far as I am aware, to the closure or the suggested threat to any other hospitals in south London, so you can specialise. I think that is very much the message of his report and of Roger Boyle's report on stroke care because of course we are consulting on this quite separately from the review, that you can have these centres of excellence where you get the best from specialists who do the operation over and over again and you can also have what is happening in your local hospital dealing with elective surgery, et cetera. I think if we make it an issue of, "Well, if they're doing that there, this hospital must close", it is kind of the wrong debate.

Q38 Dr Naysmith: But people sometimes do not understand just what it means. It means having 24-hour operation and scanning facilities and 24-hour stroke care specialists and that really is expensive, but it has to be concentrated to get the good results.

Alan Johnson: Yes, you cannot replicate that in every hospital, sure.

Q39 Dr Naysmith: What does the Department of Health think then about the current programme to replace some outdated facilities? A lot has been done already, but a lot of money is being spent on PFI projects which may not be needed in a fairly short time if places are not all going to do these highly specialised things. There was one in Leicester, I think, just last week where it was decided that you would not proceed with a PFI, big, acute programme. Is that likely to happen more elsewhere as well?

Alan Johnson: We are always keeping the situation under very close attention and Leicester was quite an old PFI. It was not delivering and, for all the reasons in the announcement made locally, it just was not going to work and we were throwing lots of money into it. I do not think that has got ramifications for this review or what we do in centralising healthcare. There is already an acute awareness, "acute" being the right word, of the need to centralise cancer care and heart care, for instance, and the point that Roger Boyle makes in his report is that cardiovascular problems, ten years ago we were the poor relation to the rest of Europe, whereas now we have really done amazingly well and we have done that in cancer, but stroke care is where heart care was ten years ago, so there is already an awareness of this. It is not as if this is all completely new, and you know this as well as I do given your position, so I think that is part of the planning process at the moment and I do not think there are ramifications here and what we do in the review for what we do with PFI.

Q40 Sandra Gidley: Moving on now to targets, everybody's favourite subject, apparently there are going to be less of them. Do you have a target for reducing targets?

Alan Johnson: Yes, kind of! No, we do not, except that, as it says here, we are going to reduce them by two-thirds. We are already coming down from something like 62 targets in 2003-06 to only 20 now, so it is a two-thirds reduction, but, no, we have not got a target for reducing targets, though it is a nice idea.

Q41 Sandra Gidley: But there are going to be locally set targets as a supplement, so do the Department have any plans for locally set targets?

Alan Johnson: It is down to the local level to decide the targets. I think the issue here, and once again my predecessor said this in her last speech to the LSE, so I am not saying anything different from her, is that top-down targets were very necessary when we came into government and you had people on waiting lists for 18 months and more, 24 hours on an A&E trolley. We had to sort that out and the way that Patricia put it was that the NHS was then in intensive care. Now, it is well on the road to recovery. Now, you do not need to have that kind of blunt instrument from the top and it is part of this looking-up-to-Whitehall-rather-than-looking-out-to-their-patients problem and it is not just in the NHS, but it is throughout government. We recognise that targets have their downside. People concentrate on things because there is a target and, if there is not a target, then they just ignore it and it is an important issue, so when we say that this should be bottom-up, yes, it is up to the localities. They get their operating framework every year from the NHS, we are the politicians who set the standards, we provide the funding and now that we have improved things to this huge degree, we do not need so many targets. We still need the 18-week one, we are still bearing down on that, and there are still a few around, but they are locally set targets by local people responding to their problems locally, and an infant mortality target in Kingston upon Thames is probably unnecessary, whereas in Kingston upon Hull it is quite important.

Q42 Sandra Gidley: You mentioned the 18-week target and that seems to have taken over as the main area of focus and last year it was all about financial delivery. Provisional data regarding the 18-week target shows that a lot of trusts are currently doing very badly, but how can you be certain that the reporting is accurate when it appears that about 50% of patient episodes are not recorded? I visited a local hospital because of concern about their very poor adherence to the 18-week target and they said, "There's a long way to go, but actually we just have not got the computer systems in place to track the patients, so we're being honest". How can we trust the information we are given? How can we be assured, when we do have a sort of target date, that the information then is reliable and people are not fudging it?

Alan Johnson: Well, there are issues still to be addressed about the data, I know, but what we have got at the moment is that the data for elective patients admitted to hospital showed that we were at 51% by April 2007 and, as far as I am aware, there is no doubt about those figures. The data for patients treated as outpatients is going to be published soon and that is the information I think you are keen to get and that will be published very soon. What we know in 2006 when we had the baseline study is that that was already at 70% treated in 18 weeks, so that is why we are confident we are going to achieve this by December 2008. There are some issues around the data that we still need to get right, but everything suggests to us that we are well on the way to achieving this.

Q43 Sandra Gidley: Is that going to be linked in with the IT system or is that something completely separate?

Alan Johnson: I do not know. Hugh, have you any pearls of wisdom on this?

Mr Taylor: Not immediately linked. We have a performance management system called 'Unify' which will be linked into the standard routine reporting system back into the Department, but it is not directly connected.

Q44 Sandra Gidley: Is not the 18-week target in effect the only game in town at the moment and other targets are going to go by the board to a certain extent?

Alan Johnson: No. The target on MRSA, for instance, continues and the other targets are just as important. No, I have not come across yet a concern that 18 weeks is messing up other issues. I think everyone understands the importance of 18 weeks. It was a manifesto commitment and it is hugely important, I think, to go from 18 months to 18 weeks and it is as important to the public now as it has ever been that they are treated quickly and they are treated promptly and all the rest of it, and I say this because some of the targets we have set might not have had had total buy-in by everyone, but I think this one does and I think it is seen as very important. From referral to operation in 18 weeks puts us in a kind of world-class position in this country.

Q45 Sandra Gidley: You have mentioned MRSA and hospital-acquired infections and that, I think, is something that is very high certainly on the public's agenda, judging from my postbag. The NHS has done relatively well with meeting waiting time targets and very measurable targets, but why has it not done so well with the infection control targets?

Alan Johnson: Well, the problem is with C.diff, as was in the news today. On MRSA we are well on the way to reducing it by 50% by 2010 and I think the week before last I announced an increase in the number of inspection teams, an increase in the money available for nurses and practitioners to say things like, "Change the curtains and change the bedding", which previously went through a bureaucratic process. I do not think we are going to fail on that target, I think we are going to meet it. There is another whole area behind these healthcare-acquired infections and perhaps it needs a separate inquiry and perhaps you have done a separate inquiry into it, I do not know, but I am just getting to grips with it now and it is a problem that has to be an absolute priority which is why one of the things in the NHS Review, part of the terms of reference, is about how we can ensure that we get cleanliness as well as clinical excellence.

Q46 Sandra Gidley: I do not know if you have seen the Healthcare Commission document which is released today, but one of the very worrying findings in chapter 4 is: "We found evidence that a significant number of trusts were also experiencing difficulties in reconciling the management of HCAI and cleanliness with the fulfilment of targets: 45% of trusts told us about difficulties in relation to the target for accidents and emergencies; 29% of trusts told us about difficulties in relation to waiting times and lists for treatment of inpatients", and this is the really worrying one, "36% told us that they had experienced difficulties" because they had to fulfil financial targets, which was the only game in town last year. What are you going to do to make sure that those conflicts do not arise in the future?

Alan Johnson: Well, we will look at that report very carefully and we will study it very carefully; it was only released today. If I can say from my own experience in Hull, for instance, they met their accident and emergency target of four hours and they met their MRSA targets and there are trusts all around the country that have done that. I do not think it is impossible to meet two targets, but obviously we will look at this and some of the problems may be this issue around top-down targets, I know. Where targets have caused problems is where trusts are chained to this target which they do not think is particularly applicable to their area or they would not have made it their priority, but they have to do it. On things like MRSA and on the accident and emergency waiting times as well, I think there was a general buy-in from this, but, if there are conflicts there, we will look at them obviously.

Q47 Dr Stoate: Obviously targets are a big issue in the NHS and we are very pleased to see the number of targets coming down and that will be a sigh of relief to everybody, but clearly it is sometimes necessary to drive performance. Are you actually aiming to use choice as another mechanism to drive performance if you are reducing targets?

Alan Johnson: Yes is the answer to that and I think choice is a very powerful one. If people have the information and they know, for instance, whether that hospital is clean, whether that hospital does non-invasive surgery for the particular operation they want to undertake, and women who are due to give birth, they are extremely fussy about where they go and choice is a tremendous driver there as well, so I think choice is one of the ingredients which will help us when we kind of move away from top-down targets.

Q48 Dr Stoate: I agree with you on that. Do you actually have any evidence yet though that choice actually does lead to better health outcomes and better outcomes for patients? Have you done any research on that?

Alan Johnson: I am not sure.

Mr Taylor: I do not think we can specifically tie choice to outcomes, except that we know, for example, that where choice was introduced, first of all, in London, for example, in relation to heart disease, the waiting times came down quickly, so where choice has been introduced, we have seen an acceleration in reduced waiting times. It was in a recent survey that we did of NHS chief executives interestingly that choice now figures for them as a key driver for pressing their organisation and quality improvement. They saw that as something that was important in terms of incentivising and motivating staff within the organisation to do better on quality. That is an indicator in itself. It does not prove quite the empirical link that you are making.

Q49 Dr Stoate: Obviously improved choice means that GPs for example have to have the full range of consultants on their choose and book system if they are going to help patients to make the most appropriate choice. One of the criticisms that I receive from many GPs around the country is that their version of choose and book does not allow them to choose consultants; it only allows them to choose the clinic or the department. Surely you would agree that, in order to improve that situation, we must have individual conditions on the choose and book database but that is not happening at the moment. What plans have you to sort that out?

Alan Johnson: That is a good point and I will look into that. I was with somebody at Ealing Hospital the other week who was telling me of what I hope are teething problems with choose and book. It is a new system that has been introduced comparatively recently. I have asked for a report on choose and book and I will look at this issue about consultants. This comes back to non-invasive and invasive surgery which I know you have a bit of a thing about. It is really talking to Lord Darzi about this. A patient should be empowered to say to a consultant who is expert with a scalpel but has not trained up to the level to be able to use non-invasive surgery, "I am sorry; I want my operation with someone who is trained to do non-invasive surgery." That is a very important part of choice to me.

Q50 Dr Stoate: Some hospitals do seem to be able to manage to put individual clinicians on and some do not. Are you going to ensure in future that all clinicians will be listed as far as possible?

Alan Johnson: I will undertake to look into it.

Q51 Dr Stoate: That is a politician's reply.

Alan Johnson: That is because I am a politician.

Q52 Dr Stoate: You would like to see that happen?

Alan Johnson: I will look into it.

Q53 Mr Campbell: On choice, it is required that we need excess capacity in the health service. How much would we need to get to that situation where you would have choice? What would be the amount of excess capacity we would need?

Alan Johnson: I do not agree we need excess capacity in there to get choice. You need capacity in there to get choice. In some places there is excess capacity while the Independent Sector Treatment Centres are getting up and running and while patients recognise that they have a choice, but we are not looking to build in over-capacity here. That sometimes is a result of introducing ISTCs but we are looking to operate efficiently and effectively with the opportunity for patients to have a choice of where to be treated. Sometimes that means an NHS treatment centre. In most cases it does. Sometimes it means private sector involvement.

Q54 Mr Campbell: If it is a matter of choice, if you went to your local general practitioner and you wanted to see a particular specialist - you would get word of mouth that there is a good one at this hospital and you would like to go and see him - where would the capacity be then? There might be a waiting list to see this particular consultant.

Alan Johnson: That would be the other issue, would it not, because the patient would be deciding on things like waiting lists and how long they would have to wait.

Q55 Mr Campbell: That is choice.

Alan Johnson: Yes. What we are looking for is a standard of clinical care where you would not just have one person. Part of what we are doing here and part of the revolution that I am realising is happening in the health service is more trained doctors. The old system depended an awful lot on people who were still training to do this. There are many more trained clinicians in the system. Yes, there might be some problems there with one particular individual if lots of people wanted to see them, but I do not think you should give up on choice for that reason. You should still pursue choice and still allow the patient to say, "Okay, I will wait a bit longer to see that particular clinician because perhaps it is non-invasive surgery and that is better for me because I will recover more quickly." All these various complex issues decide how people use their choice.

Q56 Mr Campbell: Would there be a cost to this choice?

Alan Johnson: I do not think so. This is particularly relevant for GPs in relation to access. I am having a thing with my mother in law who wants to go to a GP who is just two streets away but is in a different London postal district and she cannot. There are always things that people make up to restrict choice. I know it is sometimes seen as a term of abuse on the left to mention choice but choice within a framework of free public sector, high quality care seems to me to be fundamental. It is what we expect in our daily lives. When I was a kid growing up in the fifties, people did not have very much choice at all. People generally put up with what they were told to do by clinicians, teachers and all sorts. Now they are and will become more empowered in the future to exercise their choice. I am not criticising the middle classes for this but they have always been assertive enough to exercise their choices.

Q57 Mr Campbell: That is because they have the money.

Alan Johnson: For whatever reason. That is one of the reasons, yes, but I want everyone to be able to exercise their choice. I think it is an important part of health care for the future.

Q58 Dr Naysmith: If there is someone who is the consultant of choice, they have a long waiting list and it runs past 18 weeks, you have to have excess capacity somewhere else.

Alan Johnson: This is why I was cautious in answering the loaded question from Dr Stoate about how choose and book would work.

Q59 Dr Naysmith: There is an inevitability in what Ronnie is saying, in that we have to have a certain amount of spare capacity in the system and it is going to cost a little bit of money that would not be necessary in the old system where we were rationed by people on waiting lists.

Alan Johnson: We do not build in extra capacity as a fundamental principle in order that people can exercise choice. There is some over-capacity that occurs at a certain stage in this process but it is not us saying that we have to have over-capacity in order to exercise choice. That is not necessarily true at all.

Q60 Jim Dowd: The University of York did a study a few years saying that an acute unit's optimum level of performance was at 82% of capacity. Anything beyond that and you are running it too tight. Anything below that and you are wasting assets. You do need a degree of over-provision to ensure you can provide optimum provision.

Alan Johnson: That is very instructive to me. If that is how the system works and has always worked, that is fine. All I am saying is we have not changed this to say we have to build in some extra over-capacity to deal with this issue of choice.

Q61 Chairman: Your answers on choice suggest that you think we are there now in terms of getting your consultant because you know what that consultant does and that he or she does it well. It is very likely at this stage that it is about geographical choice. When I talk to my constituents at this stage, that might be about the best hospital car park with the lowest fees. It is certainly waiting time choice because they are told initially it will take X amount of time to see somebody there as opposed to there. How long do you think it will be before the quality of care is the real issue of choice and people will know who is the best consultant for their particular thing?

Alan Johnson: I hope not too long. I was not suggesting we were there, by the way. I do not think we are there at all. I think we would all accept this is still a big challenge for us. We have to ensure that patients have enough information that is easily accessible in order to exercise their choice and to base it on quality of health outcome. That is why this transparency, this revolution in the information available will transform health care and will allow us to move away from top down targets because it will be patients themselves who will be insisting that they get this kind of service locally from people that are accountable to them.

Q62 Dr Taylor: Although I am not quite such a connoisseur of health secretaries as Mr Amess, you are the fourth that I have come across and so far you are passing my tests pretty well. You are quite unlike one who I always compared to a well tutored medical student, who in a viva would just keep talking so that he could not be asked many questions. We are getting through the questions quite well. I do appreciate that you are saying quite clearly no major restructuring, that you are going to work with people, which is absolutely crucial. You are suitably cautious and you are able to admit that you do not know and you will go and look into it, which some people cannot even admit, so I am pleased so far. I am hoping to get some help with independent sector treatment centres. You probably have not had time to digest the report we did on these and the government's response. Some of the very serious concerns were about the lack of integration of the independent sector treatment centres with their local NHS facilities. This led to a lack of training and to the resistance in areas like mine between the NHS and the independent sector treatment centre. One of the ways of improving integration would be to relax this wretched thing called additionality. We have been told time and time again that additionality cannot be relaxed for shortage specialties which unfortunately include anaesthetics and orthopaedics which are two of the most important things that independent sector treatment centres get involved with. Is there any way of relaxing that particularly for these two specialties? It would seem to me so obvious that if an NHS orthopod has spare time from his NHS commitment, as a part of his job plan, he could work in an independent sector treatment centre. That would immediately answer some of the rifts. It would mean he was not paid extra; he was paid just the same - he or she - as for their honorary NHS work. Integration is crucial. Can you make any comments? Can you relax additionality?

Alan Johnson: I did read your report on this issue and your recommendations and our response which was very recent. I think we accepted in our response that the Committee were absolutely right about integration. We do not have integration right yet. We are not at the required level yet but that will change in phase two. In phase two the additionality aspect is no longer necessary and we are relaxing it to a huge degree. I can understand why this was introduced because this is about people working in the NHS and then working in the independent sector. This is a terrible problem we used to face that you have to wait six months for this unless you go private, in which case the same person can do it within a matter of days. This is a problem we were trying to resolve. We are now at a stage where we can ensure that additionality does not hold things back. We can use NHS staff who want to transfer around the country. We can use NHS staff who are perhaps surplus to requirement in their own area. I hesitate to say we can drop additionality because I think there are still some aspects of it we will need, but in phase two I hope some of the problems which the Committee rightly identified, which maybe stem from phase one, can be resolved so that they will not be a feature in phase two.

Q63 Dr Taylor: My understanding is that off peak surgeons are not yet released from additionality and I just wondered if it could be left to a local arrangement whereby, if there was an orthopod who was insufficiently employed in the NHS, he could be encouraged to take on a part of his job plan. It is just a suggestion.

Alan Johnson: I do not want to spoil my marvellous start with you. Why not let us take that suggestion away and have a look at it?

Mr Taylor: It was related to an assumption about an analysis about skill shortages. As far as I know, that remains the current analysis.

Q64 Dr Taylor: When is the second wave going to be completed? How many is it going to include? We have read in the papers - one does not know how reliable this is - that some of them are not going to go ahead.

Alan Johnson: I thought I would use this opportunity to say a bit about ISTCs. I have been in this post now for almost a month. It is timely to let the Committee know how I see the independent sector treatment centre programme developing for the future. The first point is that they have been an important part of this government's reforms of the NHS, particularly on waiting lists. It has also contributed to the spread of innovation and best practice. Everything I have seen suggests to me this was the right thing to do. Indeed, today I am announcing the approval of the next of these ISTCs in Cumbria and Lancashire. It will develop approximately 11,000 procedures a year including general surgery and orthopaedics for NHS patients in the area. I expect to approve more schemes in the coming months. I do not have a number but they would have to meet the need for capacity, to reduce waiting times. They would have to meet the local needs of patients and they would have to offer value for money for taxpayers. Given that scenario, what do we do for the future? There is one other thing I need to announce which is that the NHS does not have a monopoly on public services; nor does the independent sector have a monopoly on efficiency. Where an independent sector provider is not offering good value for money or high quality patient care, we will not shoe horn them into the NHS. Today, I can confirm the termination of the contracts with ATOS origin for diagnostic tests in the north west and the south west. They have failed to meet certain conditions within the contracts within an acceptable time frame so the contracts have been terminated. Where they meet the tests we bring in ISTCs. Where they are inefficient and not acting according to contract we will end those contracts. Finally, I do not believe there is a need for another national IS procurement. We have had these two waves or phases. There will not be a third one, I am announcing today. We will instead move towards greater local determination with primary care trusts taking the procurement decisions on behalf of their patients. There is no need for that to be run from Whitehall. That is consistent with the kinds of things we were talking about earlier like top down targets.

Q65 Dr Taylor: For this one in Cumbria and Lancashire you have taken local concerns about capacity into account? You have not imposed it as some of the wave one ones, where there was obviously no local wish for them?

Alan Johnson: No. Phase two is in a complete different place. As far as I understand it, this is something that has been submitted to us and it has passed all our tests.

Q66 Dr Taylor: We heard that some of the ICATs in the north west were being withdrawn and not forced through.

Alan Johnson: There is the specific contract in the north west and the south west which is the ATOS origin, carrying out diagnostic tests in those areas.

Q67 Dr Taylor: There were Independent Clinical Assessment Treatment Centres which were more for out-patient things in the north west which, particularly on the rheumatological front, they were very bothered about because they knew they could meet the targets without these; and yet there was a thought that they were going to be imposed, but I think that has been solved.

Alan Johnson: I am not aware of that issue which suggests to me it has been solved. Otherwise I think I would have been.

Q68 Dr Taylor: The government, before you came in, committed 550 million a year to ISTCs. Are you going to maintain that commitment regardless of capacity?

Alan Johnson: That is built into the programme at the moment.

Mr Taylor: As far as wave two is concerned, we are moving through a process of approvals of a number of cases. We cannot say exactly yet what that figure will turn out to be but that intention remains in place.

Q69 Dr Taylor: There have been some worries again in the press as to whether the independent sector involvement is commercially viable. It was the NHS commercial directorate that said that the NHC needs to be buying 450,000 to 500,000 procedures a year. At the moment there are fewer than that. Is there a threat that this market will collapse?

Alan Johnson: I do not think so. One of the things that was pointed out in your report is the money that had to be paid previously, the 40% mark up on spot pricing. It is an 11% addition on wave one. For wave two and subsequently any local ones coming through, it is going to have to be at the same price. There is no premium.

Q70 Dr Taylor: There is no premium at all on wave two?

Alan Johnson: No, not in the future.

Q71 Charlotte Atkins: I am very pleased to hear that you have a bottom up approach and also that the next lot of ISTCs are going to be very much more locally based with much more local buy-in. With the take or pay contracts, there is an incentive for local ISTCs to do as little as possible and hence to rip off local primary care trusts. That is happening in my patch with the North Staffordshire PCT, with the Burton ISTC having a contract with my PCT but not delivering the number of procedures that that contract should deliver. Are we going to move in the next phase to eliminating these take or pay contracts and making ISTCs far more transparent about what their commercial contracts are? We in our report had a lot of problems getting figures. Likewise, I have had the same problems locally getting figures. Are we going to move to a much more transparent approach where the local input is such that local PCTs can decide rather than having their arms forced up their backs to local contracts with ISTCs?

Alan Johnson: I saw the stuff about commercial confidentiality and I think commercial confidentiality will still come into this even though these will be locally driven, but they will be locally driven. That is the point. Without sounding pompous about it, it is an important step for government to take to say that we will not need a way through wave three delivered from the centre. It gives you much more involvement as a local MP because it is going to be accountable with your own strategic health authority and your own PCTs. I do not think it will solve the problem of commercial confidentiality because, as a previous Secretary of State at the DTI, I know that this comes into these kinds of transactions. We will be as transparent as we can without breaching commercial confidentiality rules.

Q72 Charlotte Atkins: Will there be take or pay contracts where they are guaranteed payment irrespective of the number of procedures carried out?

Alan Johnson: That depends on the nature of the deal that is struck locally. Some are take or pay and some are not.

Q73 Charlotte Atkins: That gives an incentive for the ISTC to under-perform. Even though Burton ISTC are only operating at 75% capacity, they are still not meeting their waiting list targets.

Alan Johnson: I do not know about the specific instances in your area and I would like to know more about that but generally I understand the issue about ISTCs coming in on a green field site. They do not have some of the economies of scale that the NHS has. That was one of the reasons for the premium there and it is probably one of the reasons why they are guaranteed a certain level of payment even if the customers do not come through the doors immediately. That was a very important part of phase one to set these up because we needed to get these waiting lists down. We needed to ensure better patient treatment. All of those become less relevant as the phases go on and this is one example of something that probably will not come up again, but I hesitate to say that definitely.

Q74 Charlotte Atkins: It certainly makes a lot of sense for local PCTs to be able to force ISTCs to review their case mix, rather than taking cases where people have no incentive to choose to go quite a long distance to an ISTC. For instance, if an area like audiology was taken at the ISTC, people who may be waiting a long time for their digital hearing aids would be willing to travel that distance.

Alan Johnson: There is always a balance. Some people would travel the distance if they knew they could get what they wanted more quickly. I am being as helpful as I can in terms of ----

Q75 Charlotte Atkins: Absolutely. What evidence have you taken from Lord Darzi on the relative merits of NHS elective treatment centres against ISTCs? We visited one in Dr Stoate's constituency which was an NHS treatment centre. We were very impressed by the way it worked because it was fully integrated into the NHS but still had the same success story as some ISTCs in the sense that they had planned procedures and they were not pushed off the mark by emergencies.

Alan Johnson: I have not taken any evidence from Lord Darzi on anything. That is not what I do with my ministerial colleagues. This comes back to the question on integration. NHS treatment centres are very good. The majority of patients who have exercised choices have exercised them through NHS treatment centres. Their value, as you rightly say, is that they are integrated. I see ISTCs as part of the National Health Service. To ensure that everyone else sees them that way they have to be fully integrated and I do recognise that was a very important recommendation that you made. It was one that we are still below the mark on. When we get that integration, people will not be thinking so much about ISTCs or NHS treatment centres. They will just all be part of the general level of care that is available locally.

Q76 Charlotte Atkins: There has been some criticism that ISTCs were developed without very much evidence base. Do you see that changing in the future, maybe using the evidence of past performance to inform the way that ISTCs develop into the future?

Alan Johnson: I will not comment on what happened in the past. I hope my comments today show that that is exactly how we will look at these things, based on whether they add capacity, whether they are cost effective, whether they are good for patients. If the company is not meeting the contract, we will abandon the contract. We will not have a wave three. Cumbria and Lancashire will go ahead today and some others will go ahead in phase two because they have met these kinds of tests. It is a rigorous process. Whether it has always been as rigorous a process I am not sure.

Mr Taylor: The clear intention, once we move past centrally procured contracts, is to operate on the same basis. ISCTs will be doing procedures at tariff cost and operating in the same part as any other bit of the health system. Although there were issues in relation to the start up contracts and so on, what we have done particularly in wave two is review case mix where it has looked as though there was a case for changing what the initial proposition was. We have done that quite substantially, moving away from electives into diagnostics, for example, so the aim is to be more flexible and respond more to the demands of the local situation than perhaps was the case right at the outset.

Q77 Charlotte Atkins: Without take or pay contracts? Is that what you are saying?

Mr Taylor: Certainly beyond the centrally procured contracts.

Q78 Dr Naysmith: There is something called The National Health Service Hospital Episodes Statistics. There seems to be no reason at all - commercial confidentiality and so on is important for the overall balance of things - that I can think of why consultant statistics were not integrated in ISTCs with other National Health Service consultants right from the start. Mr Taylor, right at the outset of ISTCs, why did the Department of Health fail to integrate both ISTC and private sector consultant activity data?

Mr Taylor: I do not have the answer off the top of my head. We are taking steps to change that position now. The truth of the matter is that they were seen, perhaps initially, as almost operating outside the mainstream system. The aim since they have been up and running is to draw them closer into a more integrated approach.

Q79 Dr Naysmith: Is it true to say that in the future, starting from now, you are satisfied that ISTCs will provide all of the same data that the National Health Service provides which will enable people to analyse things, like consultant productivity, and have the stuff available for revalidation by the GMC and to be able to work out whether or not ISTCs are successful compared with ordinary NHS treatment centres? That is really essential. We have to leave aside price and so on because that will depend on tariffs and there may be premiums. There may not, but we have to be able to compare ISTCs with the National Health Service units.

Alan Johnson: It sounds like a fair point. It comes under that category of things I will undertake to look at because our response to the report that you did was published in May, shortly before I came into this job. I would like to have another look at your recommendations. I presume the point you have made was not one of those recommendations so perhaps in doing that I can take that into account as well.

Q80 Jim Dowd: I am sure we are all very interested in what you said about ISTCs which are a very thorny subject, as you know. You outlined the process by which you are now assessing them. Could you confirm that you are not revisiting any decisions relating to the second wave which were taken before you arrived?

Alan Johnson: Yes, I can confirm that. We are not revisiting any of those.

Q81 Dr Stoate: In the government's response to our report on workforce planning the government denied the existence of a boom and bust cycle and claimed that the NHS had reached equilibrium between workforce supply and demand. Do you think that is true?

Alan Johnson: Yes, I think that is true. I also think that your conclusions and recommendations - I am not saying this to flatter this august body - pointed out something that is very personal to us for the future. We have agreed that this issue needs to be given serious attention. What we have done now is to get together with the unions, the royal societies, the royal colleges, et cetera, and have a real crack at this workforce planning issue. I do not think we were perfect in the past. That was something that came out when we gave evidence to this Committee. Your recommendations were very pertinent about how we go in the future and that process has already started.

Q82 Dr Stoate: We were rather disappointed about the response the government gave us because we took a lot of evidence, time and effort and we did find clear evidence of a boom and bust cycle within the recruitment and training part of the NHS. The government response was simply to say that did not happen. There was no reasoning, no argument. There was no consideration. It was just a bald, "That is not the case." You are still happy to stick to the fact that your response was reasonable?

Alan Johnson: I am because I am concentrating on the future rather than the past. I had better stick to what my predecessors have said. The terms boom and bust under our Prime Minister are words that we will never hear again in any context.

Q83 Dr Stoate: Let us look to the future then. The full output of new medical schools will not be coming on stream until after 2010. There would appear therefore to be a bit of a mismatch between the number of new medical graduates, which will be 6,000 a year, and the number who retire, which is about 1,000. Surely that is going to lead to a significant increase in the number of medically qualified people in the system?

Alan Johnson: The planning for this has been a bit more sophisticated than you suggest. We have had a particular problem because of overseas trained doctors. We are getting to self-sufficiency. As far as I can see, if we left aside the overseas trained doctors, we would be at self-sufficiency very shortly. That is a good thing and that is where we need to be. Once again, we are not aiming for over-capacity here, although there might be a bit of that coming into the system, but not by any huge amount. You cannot judge this precisely to land exactly on the spot but we are looking to be self-sufficient in UK trained medical graduates.

Q84 Dr Stoate: Certainly there are going to be more graduates being trained and coming through the system than are retiring, so the number is going to go up. Do you think it is therefore realistic that enough posts can be found for them within the current system? If you take the next few years, do you think that hospitals and PCTs will be able to employ the number that are being trained, which is going to be considerably more than we had previously and more than the number retiring?

Alan Johnson: I think and I hope so.

Mr Taylor: There are a number of pressures on the system which were taken into account in the expansion which include the reduction in the number of hours worked by junior doctors for example, and the continued dependence in this country of a large number of doctors from overseas working in the NHS. That is welcome but we are moving into a world of greater mobility of the workforce across the globe. Therefore, it is important that we continue to plan for growth. The global figures are one thing. It is working this down into specialty by specialty training, working out where the allocations best work and relating the output from medical schools to the general pattern of the number of people from overseas who are eligible to apply for the posts and so on. Those are all issues which need to be grappled with over the next few months. I do not think we are complacent and I hope our response to the report did not imply that. We are not complacent about the complexity of working through some of the issues surrounding the growth in the number of doctors. We are very conscious of the concerns that genuinely exist in the medical community about that. The potential for bringing through to our system more consultants effectively to have consultant led services and to match growth in GP and other specialist services is generally welcomed. It is a question of making sure the system works flexibly and dynamically enough to make it work.

Q85 Dr Taylor: Can I ask you to look into the very near future: 1 August? With modernising medical careers and the change over, it means that all juniors change over on the 1^st. We had a written statement on 12 July about the success rate for filling posts and I wonder if you could update us on that. On 12 July only 75% of anaesthetic junior posts were filled and in Tent particularly it was only a 64% fill rate. 1 August is very close. Have we any up to date figures on the percentage of those posts that are filled and are not filled?

Alan Johnson: Yes. I do not think it is anything new. I am not sure about particular specialties but in general 85% of the posts were filled on the first round.

Q86 Dr Taylor: There is a very high percentage of GP jobs filled and a much lower percentage of hospital jobs. It is the hospital jobs on 1 October. As a consultant in the old days when only junior doctors changed, it used to be very alarming when you had new people. Now, to have a complete fleet of new, junior anaesthetists who are crucial with crash teams as well as operations, if they are not all in post, it is going to be terribly worrying so it is particularly the percentage of hospital posts that are not filled that is the worry.

Alan Johnson: My understanding is that this has gone on every year. 1 August is the date when you get a new influx. Because we are two months behind, because of what happened with round one and the very important points pointed out in the Douglas Review on MTAS, we had to ensure quite rightly that everyone received an interview. We are running behind on this. I do not expect it to be an enormous problem. In all the feedback we get, we can cope. The big concern is what happens to the junior doctors who were not in that first phase and what happens between now and October when the second round of placements is made. That is a bigger concern that is coming to me from all the representative bodies than that there is going to be a particular problem on 1 August.

Q87 Dr Taylor: I am sure you realise this is the first time all junior doctors will change.

Alan Johnson: Sure.

Q88 Dr Taylor: You do not think there will be any UK trained juniors unemployed on 1 August?

Alan Johnson: No, I do not. I do not expect that at all. Almost all these applicants are employed in the NHS at the moment in one capacity or another. We have stretched that up to the end of October for them to continue in employment. I am not expecting any doctors to be unemployed next week unless they have not taken advantage and they have turned down a reasonable offer of employment. Every one of them should have been made a reasonable offer.

Q89 Dr Taylor: If a particular post is not filled on 1 August, the person who is holding it now can carry on, can they, if they are available?

Alan Johnson: Yes.

Q90 Linda Gilroy: What happens in October?

Alan Johnson: That is the end of the second round.

Q91 Linda Gilroy: Does that mean potentially there could be a lot of doctors unemployed then?

Alan Johnson: Potentially. That is the end of the placement. We will have people surplus to requirement. What we are working on now is how we tackle that problem, which is focusing our minds I think it is fair to say a bit more than what happens on 1 August. We think trusts will be okay. Given the points you have made, they are planning for that. We are absolutely convinced that unless someone has refused a reasonable offer of employment everyone will stay in post while this process continues until the end of October. Then we will see where we have got to.

Q92 Dr Taylor: That is reassuring. Now a slightly difficult question: UK trained doctors are brought up to believe that they have a right to a job. Every other profession does not have a right to a job. What are your comments on that when it costs so many hundreds of thousands to train a doctor?

Alan Johnson: This is a bit similar to my friend Mr Dowd's question earlier on. I am not going to stray into this territory. I do understand. It is your philosophy but I do not want to be pejorative about anyone's assumptions. I do think it is absolutely right that we become self-sufficient in doctors. In the old days, I read the Richard Gordon books and watched the films, but the fact that the whole system relied on junior doctors flogging themselves silly on 90 or 100 hours a week struck me. I think the European Working Time Directive has been a good thing. I think that training up more people has been a good thing. The fact that, if I am going to have a GP operating on me, they are not falling down with tiredness is a good thing. I wonder how the health service functioned in the old system. The new system is good. Whether that means that people believe they have a right to a job at the end of the process - they increasingly do not believe that.

Dr Taylor: Some would say the European Working Time Directive has gone too far and that the training of junior surgeons particularly - you are certainly not going to have them falling down asleep on the job - are they going to be adequately trained for the job with the limited training opportunities that they get?

Linda Gilroy: It is only the macho surgeon culture that says that.

Q93 Dr Taylor: The cost of MTAS has been emblazoned abroad as 1.9 million completely wasted. Is that a correct figure or is that a figment of the imagination?

Alan Johnson: I do not know. This has not been our finest hour. I am not sure of the cost of it. The thing about MMC, as I am sure you will appreciate, is that it was the right idea. Everyone was behind the idea of changing the process and everyone was behind the principles. It went wrong. It was a good idea but the application needed more attention. I think now, with the benefit of the Tooke Review, next year this will have settled down and in future people will think this was the right thing to do, albeit there are a lot of very damaged feelings out there at the moment. That is part of the morale issue.

Q94 Dr Taylor: We have agreed to do a brief inquiry into some aspects of the MMC in the autumn.

Mr Taylor: We need to make a slight distinction in October between people in employment and people in training. By October people will know effectively, after they have been through round two, whether they are in training posts or not. What we have agreed through the transition package that we have put in place is that even after that we will have some capacity to ensure that people who were suitable for training are given some sort of extra support. There will also be some people who are in employment already and will potentially continue in employment, though not necessarily in a training post. It is not the case that everybody who is in the system at the moment has applied for a post. At the end of round two and with the transition package, it does not follow automatically that they will be unemployed because there are other jobs in the system.

Q95 Dr Naysmith: If we can look a little further ahead than August and October this year, there is another problem that is looming on your desk. That is the fact that we have recruited lots more clinically trained people from overseas and trained more students than we can afford to employ. There have been good years. There has been money in the system and people have employed them. Are you going to have to freeze the recruitment of doctors and nurses from overseas?

Alan Johnson: I will be looking at that. As you know, we intended not to include overseas trained doctors in the MTAS procedure this year. We were taken to judicial review which we won but, because that delayed the system and because overseas trained medical students were in the mix and had started to apply, we felt it would be absolutely unfair to stop the process. I think that was the right decision. For next year we will look at the Tooke Review. There have been changes to the immigration system as well. I will have to look at that very carefully to see what we do next year.

Q96 Dr Naysmith: Are we still recruiting from overseas at the moment?

Alan Johnson: Non-EU people?

Q97 Dr Naysmith: Yes.

Alan Johnson: I do not think we are. I suppose it depends what specialty we are talking about.

Mr Taylor: There are still recruitment schemes available for both nursing and medicine where there is a specific need. It is important to make the distinction between the training for this year and more generally, where there are legitimate grounds for doing this, it is still open to trusts and others to recruit from overseas. Clearly, as workforce supply increases n the NHS, the demand for extra capacity for overseas recruitment diminishes. That is one of the things which organisations across the NHS will be weighing in the balance over the coming months and years.

Q98 Dr Naysmith: It does imply that there are going to be reductions in the numbers of student doctors, nurses and other health professionals being trained in the UK which has implementations for medical schools and schools of nursing in this country as well.

Alan Johnson: What I was talking about was people trained overseas.

Q99 Dr Naysmith: I know but we also train lots of people from overseas who will count as indigenously trained medical professionals. Are we going to carry on at the same level, as far as you know, encouraging people to come and train in our medical schools and colleges of nursing and so on?

Alan Johnson: I am not sure how many people we encourage to come and train in our medical schools. If people are over here, training to be clinicians in this country, they are part of the indigenous population. The only separation I make are those that are applying for jobs here now but have been trained overseas. There is an obvious advantage in people who we have spent almost a quarter of a million pounds a year training having jobs at the end of it, not finding those jobs taken by people who have not been trained by the British taxpayer. That is a specific issue that is quite separate from whether people who come from overseas are in this system, being trained here and working here. They are part of the indigenous population as far as I am concerned.

Q100 Chairman: Notwithstanding the issue about ethical recruitment throughout the world for our National Health Service staff, what about looking at it the other way? People do come into the United Kingdom, learn, skill and get experience and take that back particularly to the developing world. Are we likely to see a change in that through this near surplus of clinicians that we are going to have in the next few years?

Alan Johnson: I think we are likely to see a change in that there are more people coming through. We have had a 72% increase in medical school places, as you know, so there are more people from the UK being trained to be clinicians filling those posts. It is a very important contribution you make that relates to the point I was making previously. If people come from overseas to be trained here and they are trained through our system, I consider them to be part of the indigenous population. Will there be fewer or more of those in the future? Probably there will be fewer.

Q101 Chairman: Some of them do come in for specialist training for short periods of time and then return back into their system. There is a question mark in my head about whether the changes in immigration we have had in the last 12 months and the workforce planning that has taken place recently are going to in any way stop that happening, where people can improve health care overseas by coming here and getting experience in a developed health care system. I do not want to put you on the spot but could I ask you to look at that and see if you could get back to us on that?

Alan Johnson: Yes.

Mr Taylor: The balance you refer to is exactly right. We attract from overseas and it is good for our universities and colleges that people want to train in this country. In very many cases that involves them taking skills back to their countries. It is a question of holding in the balance that exemplary aim, which we would not want to lose, and maintaining good workforce planning for the UK NHS. That is a balance we have to work out, picking up from Tooke.

Q102 Chairman: My understanding is it happens in nursing as well in parts of the country.

Mr Taylor: Yes, it does.

Q103 Charlotte Atkins: There has been a lot of criticism of the way the NHS has paid increased salaries for instance to GPs and consultants and yet we have not addressed the issue of productivity. It has even been suggested that those recipients of substantially increased salaries are less productive than they were before the salary increase. Do you think that was a mistake? Do you think that issue of productivity should have been looked at before the salary increases were agreed?

Alan Johnson: I do not think it was a mistake. Agenda for Change, the consultant contract, the GPs' contract all had a fair, balanced deal. I am pleased that people in the health service are earning decent wages. That witness statement one of the problems we inherited when we came in. It was an issue about pay, the morale of the staff and the fact that they felt undervalued. It is a very important part of ensuring that people get the right level of remuneration. On GPs, for instance, the Quality and Outcomes Framework was a very good innovation. Once again, I know there is stuff about out of hours. Do I want to be treated by a GP who was called out at six o'clock in the morning, once again is tired and not able to do the job? I am broadly happy with what has happened and I am very happy with the quality of the people we have in the NHS. Productivity is not always down to the individual. I say that as a former trade union leader. Productivity is about a lot more than just whether there is a direct incentive, whether we should have paid them more money because they are not productive enough. Generally, it is around management systems and the way the system operates rather than the individuals who, through my experience, have always wanted in the NHS to do their best for patients. If we have a productivity problem I do not think it lies there.

Q104 Charlotte Atkins: To opt out of out of hours for just £6,000 must have been the bargain of the century for the BMA.

Alan Johnson: I do not think that is the issue now around GP practice. I think the issue is about under doctored areas, access and patients being able to go to their GPs at weekends and late at night when it is convenient to them. It comes back to this whole issue of choice. I am reasonably happy with what is happening with the out of hours issue. However we got to that situation, I am happy that PCTs are responsible for providing out of hours treatment. Sometimes access is mixed up with out of hours in the public's mind. They have a real issue about access and I do not think that out of hours treatment is at the same level of concern amongst the public.

Q105 Charlotte Atkins: Given your trade union background and the big rises for GPs and consultants, do you think that the staged pay award for nurses was the right way forward, particularly as Scotland for instance has paid the award in full? I appreciate they will all be on the same scale but obviously the staging of the award meant that the overall value of the award was reduced to 1.9% as opposed to 2.5%. Given that nurses' pay review body considered the evidence from all sides and came up with the figure of 2.5, do you think it is right that the government should stage the award?

Alan Johnson: Yes, I do. I was part of Cabinet that made that decision. It was very much a Cabinet discussion before making the decisions, not just for nurses but for the whole of the public sector apart from the Armed Forces, to limit pay to 2% this year. I understand how nurses feel about that. You cannot win an argument with a group of dedicated public sector workers on that point. I completely understand their argument. I hope even our most vehement critic amongst the nurses will accept that we have done an awful lot on pay and conditions since 1997. I hope they would accept that if you consolidate a temporary blip in inflation into the economy then we run the risk of going back to those bad old days. I negotiated pay in the public sector. The best deal I ever did, my members thought, was 10.5%. It meant nothing because inflation was running at 10.6% at the time. If you build inflation into the system it has far bigger ramifications for public sector workers than anybody else. You will not win an argument with public sector workers on this. I understand that. Sometimes government has to do things that are not popular and that you do not get a round of applause for but that are very necessary for the future. What I hope we can do now with the unions and the royal colleges is, instead of looking back at the last few months up to 1 November when the full 2.5% comes in, we need to look to a bridge to what we can do in the future. The decision on the 2% is not going to change. It is very necessary that people get the benefit from that but what we can do is have a fruitful discussion about where we go from here.

Q106 Charlotte Atkins: Are you saying that hopefully nurses can expect a pay award at the level of inflation in the future?

Alan Johnson: No, I am not saying that. I am not saying they cannot expect it. I have done by bit of bargaining, thanks very much. I left that ten years ago. All health service workers eventually will be included in the pay review bodies. That is a process for the pay review bodies to go through. All I am saying is that our record over the last ten years on pay for people at all levels, including hospital porters and ancillary staff in the NHS, has not been a bad record. Compared against the previous ten, it has been a brilliant record. It has been done on the basis of a stable economy, low inflation, low interest rates and that is as essential for public sector workers as it is for anybody else. We have to keep in tune with that. I am not saying anything about future pay awards. What I am saying is let us concentrate on looking to the future and dealing with some of the anomalies - low paid workers in particular; it is a very big passion of UNISON in particular about how to lift the very low paid in the NHS - and concentrate on those issues rather than look back at the last six or seven months because nothing is going to change there. The 2% policy is there; it is applied right across the board. No one will be weeping buckets about MPs' pay this year or senior civil servants' but it has all been within that 2% limit. We have not breached it for anyone. Wales, Scotland and Northern Ireland do not have an effect on UK inflation figures and the UK economy in the same way as England does.

Q107 Charlotte Atkins: Are you suggesting that we are going to have a pay review body for ancillary staff within the NHS? You will be aware as a trade unionist, as I was at the time as well - I still am - that the pay awards for nurses, when they came under the pay review body, certainly increased far more than the pay of ancillary staff in the NHS. Are you suggesting that their pay should now be subject to the evidence based system of the nurses?

Alan Johnson: The pay review body group is to be extended to cover all staff by 2008/9. That is what it says in my brief so I hope that is right.

Q108 Dr Taylor: I should have said something else under Independent Sector Treatment Centres because I let you get away with the point that ISTCs have improved waiting lists. I have just been given some figures by one of our advisers talking about operations. NHS procedures in 2005/6, 6.5 million; ISTCs, 20,000. In the nine months, April to December 2006, NHS, five million; ISTCs, 45,000. They have not improved waiting lists by the number of procedures they have done. Possibly they have stimulated the NHS to do more but it is not quite as simple as just the numbers that they have done.

Alan Johnson: You have given me the answer in your question.

Q109 Mr Amess: When you negotiated this pay increase of 10.5% and inflation was running at 10.6%, which year was that?

Alan Johnson: I know it was your government that was in power. It would have been 1990, something like that. It is incredible to think of inflation going that high but I assure you it did.

Q110 Mr Amess: Ivan Lewis is the Minister in charge of social care, is he?

Alan Johnson: Yes.

Q111 Mr Amess: The Guide Dogs' Organisation have produced a report called "Functionality and the Needs of Blind and Partially Sighted Adults in the UK". That shows that 76,000 blind and partially sighted people never go out because of what they believe to be poor social provision. I know it is only four weeks but do you have any plans to address their anxieties?

Alan Johnson: I am glad you asked the question. I cannot give you a specific answer but I will look into that. Social care is a very important part of my job and I think social care needs to have a higher profile within the Department of Health.

Q112 Mr Amess: Do you have anything to say about the patient and public fora?

Alan Johnson: I have nothing at all to say about the patient and public fora at this stage.

Q113 Mr Amess: A former colleague of yours, not when you were in the House, Lord Archer who I think was Solicitor General, is conducting an independent inquiry at the moment into hepatitis C. Were you aware of this?

Alan Johnson: I was, yes.

Q114 Mr Amess: It is very impressive, the list of witnesses who have been assembled, and it is a bit of a shame really that they are having to do it independently. When the inquiry is completed, I would ask you to look at the findings very carefully. Is Lord Darzi going to consider what the government is doing to tackle hepatitis C? Is this going to be part of his remit?

Alan Johnson: It is not part of his direct remit on the next stage review but it is something I am sure he would want to have an interest in.

Q115 Mr Amess: Would you kindly have a chat with him? As far as the publicity is concerned regarding this disease, the evidence of the funding at the moment to make the public aware is very poor. The government in 2001 gave a wish list which frankly, if you look at it, just has not been delivered. Again, I wondered if you would discuss the situation with him so that, when the inquiry is finished, we might have a robust response from your good self.

Alan Johnson: I will bone up on hepatitis C over the weekend and get back to you.

Chairman: The Committee will be looking at doing an inquiry into MMC in the autumn. Could I thank the Secretary of State very much indeed for coming along and giving evidence today? I am minded to go round the Committee and ask for marks out of ten but I think I will resist that temptation at this stage. Thank you very much indeed. I hope we can have a long and productive relationship.