Tag: defunding

How the establishment have engineered the NHS crisis

By Daniel Margrain​

A century or so ago, the Russian Marxist Nicolai Bukharin understood that the growth of international corporations and their close association with national states was symptomatic of how both aspects hollow out the parliamentary system. It is now widely recognized that the power of private lobbying money draws power upwards into the executive and non-elected parts of the state dominated by corporations. Consequently this leads to a reduction in democratic accountability and public transparency.

Internal markets, market testing, contracting out, privatization, encouraging private pensions and all the rest, are mechanisms that are intended to depoliticise the process of social provision, so making it easier to refuse it to those deemed not to deserve it on the one hand, and to clamp down on the workers in the welfare sector on the other. This ethos became established in the late 1980s under Margaret Thatcher during her third term in office.

Removing the foundations of the welfare state

Following the advice of the then chief executive of Sainsbury’s, Sir Roy Griffiths in 1987, the Thatcher government set about removing the foundations upon which the welfare state had been built. Camouflaged in the language of ‘public-private partnerships’, Tony Blair’s New Labour took this one stage further as a result of his envisaging the state as the purchaser rather than direct provider of services. Whole entities within the public sector have increasingly been outsourced, health and social care services privatized and competition and the business ethos introduced into public services in the form of managerialism and New Public Management.

Thus, within residential care, patients have been recast as customers. The aim is to ensure the domination of the market by a small number of very powerful multinational corporations whose primary concern is not the welfare of the residents in care homes which they own or patients in hospitals but with maximizing profits.

The carving up of the NHS opens up one of the worlds biggest investment opportunities. Indeed, its exploitation by private interests is proceeding at a pace. This is hardly surprising given the 2014 revelation that 70 MPs have financial links to private healthcare firms while hundreds of private healthcare corporations have donated to Tory coffers.

There exists a symbiotic relationship between privatization and what Noam Chomsky refers to as a policy strategy of “defunding”. In line with Chomsky’s notion, the aim over the last three decades has been to shrink the NHS and bring it to the point of collapse as the basis for then claiming the only solution is more privatization. In Orwellian terms, health under-funding is portrayed in the media as “unprecedented levels of overspending by hospitals and NHS trusts.” 

Health and Social Care Act

The 2012 Health and Social Care Act removes the duty on the Secretary of State for Health to provide a comprehensive health service and requires that up to 49 percent of services can be tendered out to “any qualified provider.” As early as 2013, between a quarter and a half of all community services were run by Virgin Care. Three years later, the corporation had won £700m worth of NHS and social service contracts.

The retreating by the state from the principle of universal health care provision, free at the point of delivery, can be pin-pointed to 1988 when Tory politician, Oliver Letwin, wrote a ‘blueprint’ document called ‘Britain’s Biggest Enterprise’ where he set out the stages governments’ would have to go through to achieve a US model of health care without the public noticing. The New Labour government under Tony Blair adopted Letwin’s principles. But prior to the 1997 General Election, Blair had to disguise the strategy by using dissembling language in order to get elected.

Once in power, Blair took several steps towards privatization. For example, he broke up the hospital network into foundation trusts which are essentially separate business entities. He also deliberately saddled hospitals with Private Finance Initiative (PFI) liabilities which involved the government borrowing £11 billion from private banks and financiers in order to justify the sale and breakdown of the NHS further down the line.

This culminated with the New Labour government introducing in 2009 what was termed the “unsustainable provider regime” which is a fake bankruptcy framework to justify closing hospitals. The £11 billion of PFI public money borrowed from the banks and injected into the NHS is, in the words of ‘Save Our NHS’ activist Dr Bob Gill, intended to “set up the infrastructure for the whole scale hand-over of our NHS to American corporations.”

Simon Stevens

Arguably, the most influential individual currently working in the NHS is former Labour councillor, Simon Stevens, chief executive of NHS England. After having served under the Blair government, Stevens went on to work for the US private health care provider, United Health, where he campaigned against Obama Care prior to campaigning for the Transatlantic Trade and Investment Partnership (TTIP) to be included within the UK health care remit. Those encouraged by the election of Jeremy Corbyn are still waiting to hear something from the shadow health team about this troubling development.

Controversially, Stevens introduced NHS England’s ‘Sustainability and Transformation Plans’ which form part of the annual HHS Planning Guidance. ‘Sustainability and transformation’ is Orwellian-speak for the move towards the total reorganization of the NHS predicated on more privatizations and cuts.

Two years ago this month, Dr Bob Gill attended a meeting to get some insight into what the position of the then Shadow Secretary of State for Health, Heidi Alexander, was in relation to the direction NHS England was moving in under Stevens. What he heard were narratives that fitted into the ongoing privatization agenda. According to Gill, Alexander expressed support for Simon Stevens, despite his appalling track record. There is no indication that neither the Labour leader, nor current Shadow Health minister, Jon Ashworth, intend to take Stevens to task.

This is extremely worrying given that Stevens appears to be less committed to ethics and patient care, and more concerned with perpetuating the notion that medicine is a profit-based ‘conveyor belt’ service. Could it be the case that Corbyn has underestimated the extent to which the corrupting influence of corporations and the power of lobbying money have hollowed out the parliamentary system as outlined by Bukharin a century ago?

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Why Tories & Blairites are an affront to democracy

By Daniel Margrain

In 1978, the Australian social scientist, Alex Carey, pointed out that the twentieth century has been characterized by three developments of great political importance: “the growth of democracy; the growth of corporate power; and the growth of corporate propaganda as a means of protecting corporate power against democracy.”

The corporations that now dominate much of the domestic and global economies recognize the need to manipulate the public through media propaganda by manufacturing their consent. This is largely achieved as a result of coordinated mass campaigns that combine sophisticated public relations techniques developed in 20th Century America with revitalized free market ideology that originated in 18th Century Europe.

The result is the media underplay, or even ignore, the economic and ideological motivations that drive the social policy decisions and strategies of governments’. According to Sharon Beder:

“The purpose of this propaganda onslaught has been to persuade a majority of people that it is in their interests to eschew their own power as workers and citizens, and forego their democratic right to restrain and regulate business activity. As a result the political agenda is now largely confined to policies aimed at furthering business interests.”

The under resourcing and under funding of large swaths of the public sector is part of the Tory strategy to run down public services as the precursor to their dismantling prior to them being sold off, precisely with the aim of furthering the business interests of those involved. In fact, as Noam Chomsky put it, the defunding process is standard practice within Western liberal democracies:

“[T]here is a standard technique of privatization, namely defund what you want to privatize. Like when Thatcher wanted to defund the railroads, first thing to do is defund them, then they don’t work and people get angry and they want a change. That’s the standard technique of privatization: defund, make sure things don’t work, people get angry, you hand it over to private capital.”

A century or so ago, the Russian Marxist Nicolai Bukharin realized that the growth of international corporations and their close association with national states were symptomatic of how both aspects hollow out the parliamentary system. It is now widely recognized that the power of private lobbying money draws power upwards into the executive and non-elected parts of the state dominated by corporations. Consequently this leads to a reduction in democratic accountability and public transparency.

Internal markets, market testing, contracting out, privatisation, encouraging private pensions and all the rest, are mechanisms that are intended to depoliticise the process of social provision, so making it easier to refuse it to those deemed not to deserve it on the one hand, and to clamp down on the workers in the welfare sector on the other.

Tied into this ethos is the move to dismantle the welfare state completely, which contrary to popular belief, was not a key priority for Thatcher following her election in 1979. It was not until her third term of office in 1987 that her advisers (notably the Sainsbury’s chief executive Sir Roy Griffiths) began to develop the ideas which were to be picked up and developed by New Labour under Tony Blair. Dressed in the language of ‘public-private partnerships’, the state under Blair was envisaged as the purchaser rather than direct provider of services.

To enable this to happen, whole entities within the public sector were outsourced, health and social care services privatized and competition and the business ethos introduced into public services in the form of managerialism and New Public Management; and the recasting of patients and clients as customers.

It would be foolish to understate the changes that more than two decades of neoliberalism have wrought on the welfare state. Areas such as residential care are now overwhelmingly located in the private sector, with one study suggesting that “the privatisation of social care services is arguably the most extensive outsourcing of a public service yet undertaken in the UK”.

The outsourcing process emanates from the policy of defunding which consequently is leading to a crisis in social care resulting, in part, to a shortage of nurses within the NHS that have reached dangerous levels in 90 per cent of UK hospitals. The aim is to expand the ethos of competition into residential social care and to ensure the domination of the market by a small number of very powerful multinational corporations (including, for example, the Royal Bank of Scotland and the Qatar Investment Fund). The primary concern of these corporations is not the welfare of the residents in the homes which they own but rather with maximizing their profits.

When they fail to do so sufficiently or where there are larger profits to be made elsewhere, then they will simply pull out, creating massive instability in the sector and undermining the continuity of care which is a key element of good quality social provision. The collapse in 2011 of Southern Cross, until then the largest provider of residential care for older people in the UK, is the most glaring example.

Under the Tory government of David Cameron, every aspect of the welfare state is under attack. The 2012 Health and Social Care Act removes the duty on the Secretary of State for Health to provide a comprehensive health service, while the requirement in the act that up to 49 percent of services can be tendered out to “any qualified provider” will rapidly lead to the privatisation of the NHS in England and Wales. Already between a quarter and a half of all community services are now run by Virgin Care.

A combination of cuts of around 30 per cent to local authority  social care budgets since 2010, increasingly restrictive eligibility criteria for services, and inadequate personal budgets, will leave millions without the support they need and increasingly dependent on the family, and in particular women family members.

And in place of what was once called social security, unprecedented cuts across all areas of benefits, especially disability benefits, the introduction of sanctions regimes which as Christmas fast approaches has, according to figures from the Russell Trust, contributed to over a million people being given emergency food and support in 2014-15.

Meanwhile, a bedroom tax affecting around 600,000 people will increase the number of children in poverty by 200,000 as well as harming their learning amid stress and hunger. It has recently been reported that a DWP study indicates that nearly half of those affected by the tax have gone without food so that they can make ends meet.

What drives the different rationales—economic, political and ideological—behind the current Tory government’s assault on the public sector, is the desire of the one per cent to shift the costs of a global economic crisis onto the 99 per cent. One important political consequence of this socioeconomic realignment in favour of those at the top of the pyramid is the shifting of the relationship between the state and multinational capital.

This has heightened the sense of popular alienation from the huge bureaucratic structures that dominate the lives of ordinary people which has magnified by the sheer scale of the institutions – state and private – that confront the mass of the population. Consequently, public confidence in big business and the civil service has declined dramatically, particularly since the 1997 election of Blair.

The appalling treatment meted out by Facebook to the family of Hollie Gazzard, is an example of how there seems to be no way to successfully complain or protest against these kinds of mammoth institutions and corporations. Changes supposed to make them more accountable to the public, in practice only make them more subject to central control. Far from increasing public trust, they often have the opposite effect.