The NHS and ‘Privatisation by Stealth’ – Part One

The Conservative government recently awarded an 10-year, eighty million pound NHS hospital scanning contract to private firm Alliance Medical – despite a competing bid being offered by an NHS trust that was £7 million cheaper.

The bid entered by the NHS Trust of Royal Stoke Hospital, Staffordshire was rejected in favour of Alliance Medical by health service’s head office, despite the private company charging £7 million more for the contract. Alliance Medical’s board members include Conservative MP Malcolm Rifkind, who earns £60,000 by sitting on the panel.

Neither the government nor the private firm itself have said as to why the contract was awarded at a greater expense, or what the extra expenditure will bring. Negotiations and reasoning behind the decision have been kept secret.

Ian Syme, the coordinator of North Staffordshire Healthwatch, uncovered the public health services’ cheaper bid and its subsequent denial only by ‘digging through 150 board papers’.

‘There’s little or no openness or transparency in these tendering processes, no public debate, no meaningful public scrutiny… The evidence is stacking up that NHS England have a privatisation agenda… [they] are at the moment privatizing the NHS by stealth’ 1.



This Conservative government’s agenda for the NHS can be aptly summarized in Mr. Syme’s own words; ‘privatisation by stealth.’

The government is steadily building on its agenda of privatization for the NHS, without proper public scrutiny, without appropriate critical assessment, and without the necessary public profile.

This agenda of privatisation should not come as a surprise, and neither should the government’s actions to ensure such an agenda is implemented with as little noise as possible. After all, what better way for the government to implement a policy – motivated by ideology, in contradiction with their initial promises, and against public opinion – than by stealth…?

David Cameron, in the run-up to the 2010 general elections, promised that under a Conservative government there would no cuts to front-line services and, most infamously, “no more of the tiresome, meddlesome, top-down re-structures” of the NHS.

On the wider issue of public transparency in government affairs, Cameron had previously stated politicians would have to “let go of the information that we’ve guarded so jealously.

These promises have long been brushed aside; the Tories have even engaged in a furious quest to erase these statements – as well as all pre-May 2010 press releases and speeches – from the internet. The Conservative government has and continues to demonstrate a complete abandonment of these election promises, and an actual commitment to a policy program for the NHS based on creating profit. This program truly only serves private interests and themselves.



The Conservative’s disregard of its promises to protect the NHS and the subsequent implementation of its privatised agenda have been seemingly continuous since the party’s success in the 2010 election. A month after promising to stop any wasteful reorganisation, Andrew Lansley put forward a proposal for the biggest reorganization of the NHS, based on years of extensive development. This formed the basis of arguably the crowning achievement in the party’s first term in office; the 2012 Health and Social Care Act.

Representing the single greatest action in changing the NHS since its inception in 1946, the Act removed any barrier to – and actively encouraged – the breaking-up and selling-off of the NHS and its various limbs. It lifted the cap on how much trusts could earn from PPI – Private Patient Income – from 2% to a staggering 49%, effectively establishing a two-tier NHS and encouraging the perception and identity of the public health service as a potentially-profitable institution.

The Conservative’s hefty reforms of the NHS have subsequently opened the public service to competitive markets. Again, these have been implemented by a government that promised the following: first, that no reforms would be even be introduced; and second, that any wider privatisation would be minimal, and that the NHS would be largely insulated from full economic competition.

The practical effects of the 2012 Health and Social Care Act have already been felt. The NHS Support Federation showed that private firms were awarded £3.54 billion of an available £9.63 billion of NHS contracts in England in 2014, a 36.8% win rate. The 3.54 billion worth of healthcare contracts is five times the value of contracts that were awarded to private firms in 2013.

Similarly, a report on GP-led clinical commissioning groups (CCGs) revealed that private firms won 40% of the medical contracts these CCGs have put out to tender, worth £2.3 billion.

The clear commitment the Conservatives have to extending the role of private companies in the NHS – and the Tory leadership’s emphasis on competition over contracts – has added to the already extensive financial difficulties faced by many individual NHS trusts. By extending the role of private services and ultimately increasing the total number of bidding processes and arrangements, publically-funded NHS trusts are having to spend valuable resources on bidding and competing for contracts, many of which they have already been fulfilling. Private companies do not also face the same public scrutiny and checks on the services they provide. And because they are private, the are only accountable to their board members and investors, whose majority interest is in making a profit. Such an business ideology and focus may work in some sectors, but not in a public service, whose ultimate priority is patients and their health – not profits.

This first post has covered exactly what direction the Conservatives have taken and are currently following in regards to privatizing the NHS. The practical ramifications detailed above of the Conservatives’ reforms is just one side of the coin; the level of secrecy, the hidden costs of this policy, and the deliberate suppression of information with which this has been done together form the other side.

”Privatisation by Stealth’ – Part Two’ deals with this second side to the Conservative’s program of NHS privatization.

The NHS and ‘Privatisation by Stealth’ – Part One