Nick Hopkinson: What we talk about when we talk about privatisation

It’s indisputable that privatisation is occurring in the NHS, so where does privatisation denial come from?

That privatisation is occurring in the NHS, as in education, council services, and a host of other areas, is indisputable. Privatisation involves the transfer of public assets into private hands or the transfer of public functions to the private sector. There is no shortage of examples. Patients are transported in ambulances with a G4S logo. Laboratory and pharmacy services are outsourced, as well as administrative functions, cleaning, and catering, to companies like Serco and Capita. Private companies like Virgin Healthcare are winning contracts to run healthcare and sue the NHS when they are not awarded them. The Private Finance Initiative is itself a form of privatisation, where Government abdicates its role to raise cheap finance publically, instead outsourcing this to private arrangements at higher interest rates. A recent report from The Centre for Health and the Public Interest found that between 2010 and 2016 £831 million haemorrhaged from the NHS as PFI company profits.

In this context there remains a curious strain of privatisation denial, some coming from sensible, serious sources. So what does it mean to respond to the question “Is the NHS being privatised?” with the answer “no”?

1) Use of an incomplete definition of privatisation: “If you see Sid, tell him” ran the slogan from the 1980s campaign to promote British Gas shares when it was privatised. Since there has not so far been and is unlikely ever to be an NHS share issue, by this limited definition, privatisation isn’t happening. This example from a senior commentator at the HSJ, describing talk of NHS privatisation as “silly”—“Hate to have to say it yet again, but the NHS is being underfunded, denationalised, and outsourced. It is not being privatised.” The problem of course is precisely that denationalisation and outsourcing are aspects of privatisation. Railway privatisation, which no one would dispute happened, did not involve a share issue either. Defunding a service so it is failing and patients need to seek support elsewhere is also de facto privatisation.

2) Taking a narrow focus on healthcare provision:  A recent King’s Fund report “Is the NHS being privatised?” concludes that there is only modest change, “from 7.3% in 2014/15 to 7.7% of the budget in 2016/17”. However it may not be immediately clear that this refers to purchase of healthcare from non-NHS providers, rather than the more extensive spend by the NHS in the private sector on things it would previously have done in house. The use of private healthcare providers is an entirely legitimate area of interest, but it is important not to confuse a part for the whole.

3) Conflating privatisation with “free at the point of use”: Many people protesting the rise in private sector involvement in the NHS do also fear the coming of an increasingly rationed NHS, with charges for additional care. As the King’s Fund reports: “the NHS can no longer maintain quality of care and meet performance standards within its current budget.” However this is bait and switch in discussions about privatisation. Before the railways were privatised you still had to buy a ticket. An outsourced health service doesn’t necessarily need to charge users upfront.

4) Declining to believe in the direction of travel: This relies on the semantic argument that the NHS is not being privatised because there is no intent to completely privatise it or because privatisation so far has been limited. The 2012 Health and Social Care Act was intended to increase marketization in the NHS. Although there have been attempts to dismiss it as a “mistake” it formed a continuation of neoliberal policies and ideology stretching back to the 1980’s. Even the IMF now acknowledge the hazards of neoliberalism, not least worsening inequality. The recent decision to abandon the privatisation of NHS Professionals is welcome but is likely to be a question of timing and political tactics rather than a change of heart on the government’s part.

5) No, it’s already been privatised: Since the 1980s, as outlined in the introduction, many aspects of the NHS have been transferred to the private sector and many people in supporting roles who would have been employed by the NHS are now employed by outsourcing companies. For example, a recent study showing that outsourcing cleaning services was associated with increased MRSA incidence, found that in 126 acute trusts 51 outsourced cleaning and 75 retained it in-house.

People objecting to privatisation have specific concerns about how this will function in the NHS. How will relationships of professionalism and discretionary effort be preserved in a system where activities are increasingly monetised? What is the opportunity cost of funding competitive tendering and other aspects of market infrastructure? Onora O’Neill has highlighted the dangers when there is a change from a system of trust to a system of regulation and performance indicators.They also have general concerns about the diminishing role of the public sector—loss of accountability, reversal of gains in conditions of employment and other rights, reduction in equitable access and a reduced multiplier as money is siphoned offshore rather than recycled through the tax system.

Sensible consideration of these issues requires a holistic view and transparent definitions, so it is clear what is actually being discussed.

Nicholas Hopkinson, Reader in Respiratory Medicine, Imperial College London.

Competing interests: None declared.