PARLIAMENTARY DEBATE
NHS Shared Business Services - 27 June 2017 (Commons/Commons Chamber)

(Urgent Question): To ask the Secretary of Statement to make a statement on NHS Shared Business Services.

As the House knows, on 24 March 2016 I was informed of a serious incident involving a large backlog of unprocessed NHS patient correspondence by the company contracted to deliver it to GP surgeries—NHS Shared Business Services. The backlog arose from the primary care services’ GP mail redirection service that SBS was contracted to run. No documents were lost, and all were kept in secure storage, but my immediate concern was that patient safety had been compromised by the delay in forwarding correspondence. A rapid process was started to identify whether anyone had been put at risk.

The Department of Health and NHS England immediately established an incident team. All the documentation has now been sent on to the relevant GP surgery where it was possible to do so, following an initial clinical assessment of where any patient risk may lie. Some 200,000 pieces were temporary residence forms and a further 535,000 pieces were assessed as low risk. A first triage identified 2,508 items with a higher risk of harm, of which the vast majority have now been assessed by a GP. Of those 84% were confirmed to be of no harm to patients and 9% as needing a further clinical review. To date, no harm has been confirmed to any patients as a result of this incident.

Today’s National Audit Office report confirms that patient safety was the Department and NHS England’s primary concern, but as well as patient safety, transparency with both the public and the House has been my priority. I was advised by my officials not to make the issue public last March until an assessment of the risks to patient safety had been completed and all relevant GP surgeries informed. I accepted that advice for the very simple reason that publicising the issue would have meant GP surgeries being inundated with inquiries from worried patients, which would have prevented them from doing the most important work, namely investigating the named patients who were potentially at risk.

A proactive statement about what had happened was again not recommended by my Department in July for the same reasons and because the process was not complete. However, as I explained to the House in February, on balance I decided that it was important for the House to know what had happened before we broke for recess, so I overruled that advice and placed a written statement on 21 July. Since then, the Public Accounts Committee has been kept regularly informed, most recently being updated by my permanent secretary in February. The Information Commissioner was updated in August.

In July 2016, I committed to keeping the House updated once the investigations were complete and more was known, and I will continue to do so.

I welcome the Secretary of State to his place, but is it not an absolute scandal that 709,000 letters, including blood test results, cancer screening appointments and child protection notes, failed to be delivered, were left in an unknown warehouse and, in many cases, were destroyed? Does not the National Audit Office reveal today a shambolic catalogue of failure that took place on the Secretary of State’s watch?

As of four weeks ago, 1,700 cases of potential harm to patients had been identified, with this number set to rise, and a third of GPs have yet to respond on whether unprocessed items sent to them indicate potential harm for patients. Does the Health Secretary agree that this delay is unacceptable? When will all outstanding items be reviewed and processed?

The Secretary of State talks about transparency, but he came to this House in February because we summoned him here. In February, he told us that he first knew of the situation on 24 March 2016, yet the NAO report makes it clear that the Department of Health was informed of the issues on 17 March and that NHS England set up the incident team on 23 March, before he was informed, despite his implying that he set up the incident team. Will he clear up the discrepancies in the timelines between what he told the House and what the NAO reported?

The Secretary of State is a board member of Shared Business Services, and many hon. Members, not least my right hon. Friend the Member for Exeter (Mr Bradshaw), have warned him of the problems and delays with the transfer of records from SBS. Given that those warnings were on the record, why did he not insist on stronger oversight of the contract?

The cost of this debacle could be at least £6.6 million in administration fees alone, equivalent to the average annual salary of 230 nurses. Can the Health Secretary say how those costs will be met and whether he expects them to escalate?

Finally, does the right hon. Gentleman agree with the NAO that there is a conflict of interest between his role as Secretary of State and his role as a board member? Further to that, can he explain why his predecessor as Secretary of State sold one share on 1 January from the Department to Steria, leaving the Secretary of State as a minority stake owner in the company, and never informed Parliament or reported that share in the Department’s annual report—

Order. We are immensely grateful to the hon. Gentleman, but sooner or later the discipline of sticking to the two minutes has to take root. I am afraid that it is as simple as that and I am sorry, but he has had two and a half minutes.

Let me respond to those points. First, what happened at SBS was totally unacceptable. It was incompetent and it should never have allowed that backlog to develop, but before the hon. Gentleman gets on his high horse, may I remind him that SBS and the governance arrangements surrounding it were set up in 2008, at a time when a Labour Government were rather keen on contracting with the private sector? I know that things have changed, but the fact of the matter is that throughout this process our priority has been to keep patients safe. Transparency is nearly always the right thing; I am the Secretary of State who introduced transparency over standards of care in hospitals—[Laughter.] It is interesting that Opposition Members are laughing, as Labour was the party responsible for sitting on what happened at Mid Staffs for more than four years, when nothing was done.

Transparency is incredibly important but it is not an absolute virtue, and in this case there was a specific reason for that. If we had informed the public and the House immediately, GP surgeries would have been overwhelmed—we are talking about 709,000 pieces of patient data—and they would not have been able to get on as quickly as we needed them to with identifying risk. That was the priority and that is what today’s report confirms: patient safety was the priority of the Department and NHS England. I put it to the hon. Member for Leicester South (Jonathan Ashworth) that if he were in my shoes, and faced with advice that said that it was wrong to go public straight away as that would compromise the very important work GPs had to do to keep patients safe, he would have followed exactly the same advice. That is why, while I completely recognise that there is a potential conflict of interest with the Government arrangements, I do not accept that there was an actual conflict of interest, because patient safety concerns always overrode any interests we had as a shareholder in SBS.

The NHS is a large organisation. It has a huge number of contracts with both the public and private sectors, and no Government of any party can ever guarantee that there will be absolutely no breach of contract. However, what we can do is ensure that we react quickly when there is such a breach, which happened on this occasion, and that we have better assurance than we had on this occasion. I assure the House that the appropriate lessons will be learned.

While Members from across the House will be relieved that so far no patients are identified as having been harmed by this appalling incident, will the Secretary of State set out what steps he is taking to ensure that this can never happen again?

Absolutely. There is a short-term and long-term lesson. The short-term point is that it is unlikely this would happen again because it was paper correspondence, and we are increasingly moving all the transfer of correspondence to electronic systems. The longer-term point is exactly that—[Interruption.] An Opposition Member mentions cyber-attacks; they are absolutely right to do so, because of course we have different risks. This clearly indicates that we need better checks in place, so that when we trust an independent contractor with very important work, we know that the job is actually being done, and that did not happen in this case.

The NAO’s findings are deeply concerning for the families of patients caught up in this chaotic shambles. For those involved and the wider public, this will only deepen their mistrust and misgivings in how the Tories are running the NHS; we can be grateful that they are not in charge in Scotland. Surely it is simply astonishing that a company partly owned by the Department of Health failed to deliver 500,000 NHS letters, many of which contained information critical to patient care. Not only were 1,700 people potentially at risk of harm, but thousands of others were put at risk. Was this SBS contract properly scrutinised by the Secretary of State? Was patient care or cost-cutting at the forefront of that decision? Why did he publish a vague written statement in July 2016 when he actually knew what was going on four months earlier?

Splendid—the hon. Gentleman was within his time. He gets an additional brownie point.

I gently say to the hon. Gentleman that it is totally inappropriate to try to make political capital from this incident. The facts of the case are that the NAO today published a report saying that patient safety was the primary concern of both the Department of Health and NHS England throughout. There were some problems with the assurance of that contract, but the contract and the relationship with SBS in particular dates back to 2008. Both sides of the House need to learn the lessons of properly assuring NHS contracts, and I dare say the same is true in Scotland.

I fully support the Secretary of State’s actions, which were quite right in the difficult circumstances in which he found himself, but what action will be taken against the executives who presided over this shambles? Is there any enforcement mechanism under the contract against the other owner of the company?

The company has been stripped of that contract; it was relieved of the contract back in 2015. We are very clear that it will have to fulfil all its contractual requirements, including paying its fair share of the costs that have been incurred as a result of this wholly regrettable incident.

I did not come to that conclusion. The hon. Lady is right, as a doctor, to say that patients’ trust in the way we hold their records is very important. In this case, the correspondence concerning patients was not forwarded, but it was not lost either. It was held securely, so no patient data were put at risk, but it should have been forwarded to another part of the NHS, and it was not; it was effectively stockpiled. That is what caused the concerns. We have been going through the high-priority cases. So far, the vast majority of cases have had two clinical reviews, and the ones we are still concerned about are having a third clinical review. We are taking this extremely seriously.

The Secretary of State mentioned Mid Staffordshire and patient safety, which is absolutely critical, but may I point out that the County hospital in Stafford now has an excellent record? It is currently seeing 27 patients in A&E with a waiting time of not much more than one hour, according to the app that I have on my phone. Will he confirm that the situation has been transformed because of the fantastic work of the staff in that hospital?

I am happy to confirm that. I am also happy to say that the problems in the old Mid Staffs, which I am afraid we had in many parts of the NHS, are being addressed much more quickly because of an independent oversight regime—the new Care Quality Commission inspection regime—and the appointment of a chief inspector of hospitals, who is independent in law and gives his judgment independently in law. That is something the Labour party regrettably tried to vote down.

May I commend to the House the record of the debate I secured in November 2011, in which I warned the Government in terms about the very poor record of SBS and urged them not to part-privatise what had been an excellent NHS service? Ministers said at the time that the new contract would save £250 million. Will the Secretary of State now tell the House how much this scandal has cost, rather than saved, the taxpayer? Will he apologise both to the staff and the patients affected?

The costs are in excess of £6 million, and we are seeking to recover as much of that as we can from the company involved. I know that the regime in the Labour party has changed, but to try to turn this into an issue of privatisation when under the right hon. Gentleman’s own party’s Government—and indeed, during his own time as Health Secretary—we had problems at Mid Staffs that were squarely in the public sector is wholly inappropriate. This is about proper assurance of what is going on in the NHS, and both sides of the House need to learn the lessons.

In order to reassure my constituents, will my right hon. Friend confirm that NHS SBS no longer provides this mail redirection service, that all backlogged correspondence has now been delivered to the relevant GP surgeries for filing and that no patient harm has been found in this case?

My hon. Friend is exactly right. Of course we welcome the fact that no patient harm has been identified to date. We have to wait until the process of the third clinical review is completed on at-risk patients’ records, which will happen by the end of December. She is absolutely right to say that SBS is no longer performing this contract; it has been taken in-house. Other parts of the SBS contract not related to what we are discussing today were given to another supplier.

Does the Secretary of State agree that this is a very straightforward case? It shows a woeful lack of transparency, is a good example of why so many of us have concerns about too much private sector involvement in the NHS and, bluntly, there is a conflict of interest for the Secretary of State.

I acknowledged in my statement that there is, or was, a potential conflict of interest when the contract with SBS was in operation, and the National Audit Office talks about that today. In reality, as the National Audit Office confirms, patient safety was always our overriding priority in all the decisions we took. I suggest to the hon. Gentleman, as I do to the shadow Health Secretary, that he would have taken exactly the same decisions had he been in my shoes.

My right hon. Friend has confirmed that the contract has now been taken in-house. Can he also confirm that it is a totally different operation and that none of the people who were involved in making the decisions is now involved in making the decisions on the current service?

I can absolutely confirm that.

I am pleased that the Secretary of State at least acknowledges that this was incompetent but, crucially, does this not run deeper? Problems were first raised in January 2014, and then again internally by an administrator in June 2015. He found out, as Secretary of State for Health, only in March last year, and the Public Accounts Committee found out and was able to look at this only in September, because information was released on the final day that Parliament sat last summer. He talks about transparency, but does he not think there are deeper lessons to be learned here not only about transparency but about how the NHS supports whistleblowers?

There are two big lessons that we need to learn. First, why did the company have no internal systems in place to deal with the fact that from 2011 the mail was building up into a backlog? According to the NAO report, the situation was not escalated to the chief executive’s level until the end of 2015. That is wholly unacceptable. Secondly, it is also unacceptable that we did not have the assurance systems in place that would have allowed us to know that a backlog was building up. That is why it is so important that lessons are learned.

Who drew up the contract for the redirection service that omitted any key performance indicators?

The original contracts with SBS went back to 2008, which is when it started providing mail redirection services, but they were renewed in 2011, which is why I think Members on both sides of the House need to reflect on this.

Over 700,000 pieces of sensitive medical information went missing, and the situation was allowed to escalate over a five-year period without being discovered, which I think shows gross incompetence. What has been done to set right this wrong, especially for the families left behind who have been affected by this worrying incident?

There has been a huge operation to deal with this. As the hon. Gentleman will know, there were 709,000 pieces of correspondence. We did an initial clinical triage to identify which ones were low risk, such as notifications of change of address, and which ones were higher risk, such as test results. We identified 2,500 that had a high priority, and 84% of those have so far been identified as being of no clinical risk, but we are continuing to do more thorough clinical risk assessment.

As I am sure the Secretary of State is aware, for many patients the image created by the media is one of documents being lost. Can he confirm that at all times the correspondence was kept either in secure conditions on NHS premises or in secure archive facilities?

I am happy to confirm that. I think that in such situations it is important to allay public concerns about what might have happened. What happened was unacceptable, but no patient data were lost.

The Secretary of State says that no patients were harmed and that the documents were securely stored, but 35 sacks of mail were destroyed. How does he know that he made the right call in every situation?

Just to be clear, what I said was that to date there is no evidence of any patients being harmed, but the process of proper clinical review, with multidisciplinary teams, will take until the end of the year. We have to do this properly to get to the answer. We hope that it remains the case that no patients were harmed, but we will not know that until the end of the year. However, throughout this whole process we have prioritised the highest risk cases and made sure that they get the most urgent attention.

Following this failure, I welcome the Secretary of State’s decisive action in bringing in the national incident team. How will we learn the lessons and share the best practice, as discovered by that team?

The NHS is extremely good at responding to crises and emergencies, as tragically we have found out in recent months. This is an example of the NHS doing a very good job when it realises the scale of the problem. For me, the lessons that really need to be learned are about not the response to the issue but the assurance processes that allowed the problem to happen in the first place.

The National Audit Office says that the review of the backlog of correspondence has found 1,788 cases of potential patient harm, so what action is the Secretary of State taking to support those patients?

All those cases have already been looked at by two sets of clinicians, and so far, on the basis of those two reviews, no patient harm has been identified. However, because we want to be absolutely sure, we are having a third clinical review that will be even more thorough, potentially with more than one set of clinicians, so that we can get to the bottom of this and find out.

I understand that the inquiry has focused on patient risk, but has there been any analysis of the impact on patient waiting times, which are also extremely important for patient care? Exactly how many patients have waited longer than they should have for treatment?

The hon. Lady is right. That is one of the most critical questions when it comes to trying to understand whether there was any actual patient harm. Ordinarily, if a patient was waiting for a test result that did not arrive at their GP’s surgery, the GP would chase it up and get a copy, so there would be no delay in treatment. However, only by looking at the patient’s notes can we understand whether any harm is likely to have happened. So far we have not identified any patient harm, but we will continue to look.

The Secretary of State told the House in February that all correspondence was kept safe and secure, and he has repeated that claim today, so when did he know that 35 sacks of mail had been destroyed by staff, and why has he not mentioned it since?

As the hon. Lady knows, I was informed at the end of March 2016. The issue with the correspondence that was destroyed relates to procedures around what it is legitimate to do when patients have been dead for 10 years. At the moment we are not aware of any specific risk to patients as a result of those sacks of mail being destroyed, but we will continue to look at the issue very closely.

The Secretary of State was made aware of the failings of the contract and warned about the dangers in the House in 2011, yet he did not take up two places on the company’s board. Would that not have added to the overall scrutiny of the contract? Is he not guilty of being asleep at the wheel?

I have been Health Secretary for a long time, but not since as far back as 2011. However, the hon. Gentleman asks an important question. It is true that the Department was entitled to three seats on the SBS board but took up only one, but I do not believe that would have made a difference in this case, because the board directors were intended to represent the Department as SBS shareholders. What we needed was better assurance of the implementation of the contract. That needed to happen with the NHS as a contractor. That is the lesson that needs to be learned.

The Secretary of State talks about the need to learn lessons, but we have seen a pattern across Government—not just in the Department of Health, but in the Department for Work and Pensions and the Home Office, for example—of companies being awarded contracts and then failing miserably. Those companies have the contract taken away but are then awarded another one. Clearly the lesson to be learned across Government is that some companies are simply not fit for purpose when it comes to delivering public services.

We do need to be robust when companies fail in their contracts with the public sector. I do not think that this affects only private sector companies, because we contract with people in the public sector and are let down. Equally, we need to be robust when the right things do not happen. Most importantly, the lesson from what happened with SBS is that we need to understand much more quickly when things are going wrong, so that we can nip problems in the bud. That did not happen in this case.

How many more times is the Secretary of State going to come to this House, as he has done on countless occasions, when he personally is at the centre of a controversy? Even a cat has only nine lives.

I am not sure that I have as many lives as the hon. Gentleman.

My hon. Friend the Member for Tooting (Dr Allin-Khan) was absolutely right when she suggested that the Secretary of State is trying to downgrade 1,788 cases of potential harm and a potential conflict of interest to no more than an administrative error by a contracted-out service. In my constituency, a tender for cancer care was ended prematurely, costing the taxpayer millions of pounds. Are these not examples of where the Conservative party’s ideological agenda to contract out our NHS services is failing and patients are suffering as a result?

Quite the opposite. Those examples show that we take the contracts off the private sector when it lets us down. That is what happened in the case raised by the hon. Gentleman and with SBS.

Shared services in my constituency saved £120 million in four years. When the system was privatised under Steria, it lost £4 million and goes on being inefficient. Can the Government escape from this paralysis of thought that is costing the country so much—that everything private is good and everything public is bad? Will they look to not outsourcing but insourcing services from the inefficient private sector back to our wonderful, efficient civil service?

I gently remind the hon. Gentleman that the last Government who had an active policy of increasing private sector market share in the NHS were the last Labour Government. This Government legislated to stop the Government nationally prioritising the private sector and made that a decision for individual doctors at a local level.

As a doctor, I understand the importance of ensuring that results and letters are reviewed in a timely manner. There will always be opportunity for error in any system relying on bits of paper being sent around. Hospitals such as Peterborough City hospital, where I have worked, provide results electronically, which is quicker, as well as having a back-up paper form, which provides for patient safety. Will the Secretary of State reassure us that good practice such as this is being rolled out elsewhere?

Absolutely. My hon. Friend is right to point out that we are in a different world from the world of 2011. The future is to transport patient records securely over electronic systems. It is much quicker and there is much less room for error, but we do need the back-up systems that she mentioned.

I wrote to the Secretary of State in January on behalf of a GP practice in my constituency that is concerned about the potential impact on staff working at the practice. I raised the matter again four months ago during the previous urgent question, and the Secretary of State promised to look into the impact on staff. Can he report back to the House today?

I will relook at the situation in that surgery to ensure that we are learning any lessons that need to be learned. However, this is a complex process. There have already been two clinical reviews in the vast majority of the high risk cases, and we want to have a third review to really establish whether there was any actual patient harm. That takes clinician time, which is one of the reasons why we have not been able to complete the process by today. It will take until Christmas to do that because we have to balance the other responsibilities that clinicians have in their daily work.

Earlier, the Secretary of State assured the House that the individual directors who are responsible for this catastrophe are no longer in a position to cause similar damage. Is he aware that the briefest of searches through Companies House records shows that the same three or four names associated with Shared Business Services come up time and again?

There are about a dozen companies, many of which come under the Sopra Steria Ltd group of companies, and most of which advertise the fact that they do a lot of work for the NHS right now. One is titled NHS Shared Employee Services Ltd, which suggests that, far from having been removed from any influence, the individual directors who were legally responsible for this disaster are still very much in a position to make money for themselves while presiding over similar disasters in the future.

I note the hon. Gentleman’s comments, but he will understand that I am not in a position to pass judgment at the Dispatch Box on the behaviour of individuals. The Department for Business, Energy and Industrial Strategy has respected and well-established systems in place to ensure that people who are not fit and proper to be company directors are not able to continue with their duties.

My constituents are served not by the SBS contract, but by the Capita contract. I have raised problems with that contract to the Secretary of State on many occasions. There are still problems with the helpline, which appears incapable of logging and following through with complaints. Why is this contract, which is clearly failing, not taken back in-house by the Government?

Just to be clear, this is a different contract, as I know the hon. Lady understands. We have been working hard, and I know that the hon. Lady worked hard with my Department in the previous Parliament to try to get to the bottom of the problems with the Capita contract. My understanding is that the situation is improving, but I will happily look into the individual situation she mentioned.

The Secretary of State said that this takes time and, if I heard correctly, that a third of GPs have failed to respond. What steps is he taking to ensure that patient care is not being compromised by the extra admin burden on already overworked GPs?

We are paying GP surgeries for the extra admin time that this is taking. That is designed to ensure that, where necessary, they can buy in extra resources to deal with the extra admin. The hon. Lady is absolutely right that we have to ensure that GPs’ core work is not compromised by the issue.

I used to work as a clinical scientist in the NHS, so I know only too well the harm that can be caused by the non-arrival of a test result. If a diagnostic test is performed and the result goes nowhere and is not seen by a clinician, as in this case, it is the same health outcome as if the test was not done at all. Will the Secretary of State stop trying to downplay the situation and own up to the seriousness of this scandal?

No one listening objectively could possibly say that I am, or that anyone on this side of the House is, downplaying this very serious situation. Since the issue came to light, we have instituted a review of 709,000 pieces of patient correspondence. We have identified the high-priority ones, of which there are 2,508. Two, and sometimes three, clinical tests have been done on all of them. No patient harm has been identified to date, but we are not complacent. We will continue the process until we have been through every single patient record with that thoroughness.

I too will mention the Capita contract. This is not an isolated case. A pattern is occurring. The Government are failing in their governance over patient records. Will the Secretary of State now review that governance and bring it back in-house? It is so urgent that we oversee the safety of patients first.

As I confirmed to the hon. Member for Stretford and Urmston (Kate Green), I will look into the outstanding issues with the Capita contract for GPs that are not related to the delivery of patient records. My understanding is that things have got better, but we were very unhappy with the initial performance from Capita.