15 August 2019 — WSWS
A socialist strategy is needed to defend jobs and conditions
Hospital workers in Bradford, England, facing the backdoor privatisation of their jobs have voted to take indefinite strike action from August 26.
This is the latest in a series of disputes that have hit the National Health Service (NHS) in the last four months—in Merseyside, Cornwall, Blackpool, South London, Birmingham and Doncaster, involving workers in pharmacy, catering, cleaning, domestic services, porters, building services and security.
Many are seeking to avoid being hived off into wholly owned subsidiaries (WOSs), commercial operations owned and controlled by their parent NHS trust.
According to NHS Providers, such an operation enables “trusts to create pay scales that are more flexible and…reflect market conditions.” Trusts have been actively setting up WOSs since 2010, but there has been an increase “in recent months” because the “new strategic direction in the NHS requiring trusts to support new models of service delivery, pursue system collaboration and integration, and deliver operational productivity improvements.” This is code for implementing cuts, speed-ups and other “efficiency measures” at the expense of the workforce.
Part of the “strategic direction” is the Conservative government-imposed diktat to enforce year-on-year “savings” of 4 percent, as well as improving productivity. The Kings Fund health charity notes that the expected 1.1 percent productivity increases over each of the next five years do not include the 4 percent savings targets being imposed on hospitals and other front-line services.
Gains already achieved have been almost entirely at the cost of staff wages, which were frozen for seven years between 2010 and 2017. The “pay cap” cost the average health worker a wage cut of £2,000 in real terms. Even when it was lifted, increases have barely matched inflation. The government and employers are now looking more intently at other areas to achieve their “savings” targets. According to Keep Our NHS Public, at least 30 NHS trusts have set up a WOS in recent months.
NHS trusts were introduced by the 1997 Labour government under Tony Blair, as part of moves to “marketise” health care. This provided the basis for Tory administrations to break up the NHS into smaller and smaller units, each having a “market relationship” with the others.
The Regional Health Authorities and the succeeding Regional Offices were abolished, while the 2012 Health and Social Care Act further atomised the health system in England, introducing Clinical Commissioning Groups (CCGs) of GP surgeries as the fundamental financial unit of the NHS. The NHS now comprises more than 150 nominally “independent” NHS Trusts, responsible for running hospitals and other critical services, and 191 CCGs providing local GP services.
The salami slicing of the NHS and the introduction of an internal market, where CCGs bid for contracts, mean almost half of all NHS trusts were in deficit in 2018/2019, with over two-thirds of acute hospital trusts in the red.
Justifying the introduction of a WOS covering estates, facilities and clinical engineering services, Bradford Teaching Hospitals NHS Foundation Trust points to the 4 percent “efficiency savings” it must make—a cut of £16 million a year. The Trust promises to “protect” the employment terms and conditions for existing staff, who will have “access” to the NHS pension scheme for a period of 25 years. But trade union solicitors say the new company would be able to legally change workers’ terms and conditions after just 12 months. Staff turnover means it would not take long for the existing workforce in the WOS to be replaced with one on considerably worse pay and conditions.
As a separate business entity, the WOS will be able to bid for other contracts, leading to mergers and job and pay cuts. They are prime candidates for takeover by major transnational companies such as Interserve, the Compass Group and Sodexo.