It Is Now Labour’s Turn to Expand the Piecemeal Privatisation of the UK’s National Health Service

To treat the NHS’s ills, Keir Starmer’s government is talking about bringing back Tony Blair’s health secretary, Alan Milburn, who is now in the pay of corporations with interests in the UK’s healthcare sector.

The UK’s new Labour government is only six days old but its grand project to further privatise the National Health Service (NHS) is already up and running. On his first day in office,  “über-Blairite” Health Secretary (and wannabe prime minister) Wes Streeting announced that the NHS was “broken,” which should give his ministry plenty of leeway to inflict further damage while blaming all the resulting chaos and destruction on the last 14 years of Tory government.

By all metrics, the Conservative Party has left the NHS in a state of rack and ruin. One of the largest employers on the planet, the NHS is suffering from crippling staff shortages, dangerously long ambulance waiting times, unprecedented waiting lists for surgery or specialist clinical care — partly due to the coronavirus pandemic but also exacerbated by years of chronic underfunding — and a buckling primary care system. Oh, and NHS dentistry is in a state of virtual collapse.

“When we said that patients are being failed on a daily basis, it wasn’t political rhetoric, but the daily reality faced by millions,” said Streeting, who incidentally won his seat by a wafer-thin 528-vote margin. “Previous governments have not been willing to admit these simple facts. But in order to cure an illness, you must first diagnose it.”

Outdoing New Labour on NHS Privatisation

Whatever the diagnosis, the treatment is already abundantly clear: yet more privatisation. Streeting himself has repeatedly pledged to outdo Tony Blair, his mentor and idol, in deploying the private sector in the provision of NHS care. Now, to help “cure” the NHS of its ills, his Health Ministry is apparently planning to bring back Sir Tony Blair’s health secretary Alan Milburn. From The Daily Telegraph:

Mr Milburn’s appointment comes as Labour appears to be planning significant changes to the health service.

A Labour source said: “In opposition, he has been incredibly helpful to Wes and his team to make sure we are ready to hit the ground running. Particularly in the last six weeks, he has been working really closely with the team on a daily basis to make sure we have the plans in place to hit the ground running.

“Alan brings the insight and the knowledge of what made the biggest difference last time Labour was in office – the courage to make the really big reforms to the health service.

“It was the reforms on transparency, choice, and use of the private sector that delivered the goods on cutting waiting lists and making the NHS sustainable for the long term.”

None of this, of course, is surprising. In recent months, Streeter has been nothing but candid about his plans to deepen and broaden NHS privatisation. In late May, he said he would “go further than New Labour ever did, adding that he wants “the NHS to form partnerships with the private sector that go beyond just hospitals.”

Now, his ministry is offering Alan Milburn an as-yet unspecified role. As statements of intent go, this one could not be clearer.

Few individuals have done more to advance the privatisation of the UK’s health system than Milburn. Since serving as secretary of state for health from 1999 to 2003, he has had a burning ambition to open the NHS to as many private interests as possible as well as a financial stake in making that happen through his consultancy and lobbying firm, AM Strategy, which advises private healthcare clients.

During his four year-stint as health secretary, Milburn promoted NHS outsourcing, including buying NHS operations from private hospitals. He also sought to encourage US health firms to expand their operations to the UK, which was ultimately thwarted (temporarily) by Gordon Brown. Milburn was also the first health secretary to begin applying the disastrous Private Finance Initiative (PFI) to NHS infrastructure projects. As I have noted previously for WOLF STREET, PFI is one of the main reasons why the NHS is so short of cash today:

PFI, and its latest incarnation, PF2, allowed bankers and financial consultants to gorge on massively inflated interest rates and fees for run-of-the-mill infrastructure projects, while saddling taxpayers with debts they will struggle to repay. For over two decades. It was effectively “a fraud on the people”, as one of the biggest beneficiaries of PFI all but admitted a few years ago:

Sir Howard Davies, chairman of the Royal Bank of Scotland (RBS), recently made an astonishing admission on BBC1’s Question Time when he stated that private finance initiatives (PFI) had been a “fraud on the people”. Beyond seemingly populist rhetoric, the real story of PFI reveals that RBS alongside other global banks, notably HSBC, were instrumental in what Sir Howard has effectively labelled a great heist.

For the UK Treasury, PFI and PF2 had one obvious benefit: they allowed ministers to harness large sums of private capital to invest in public projects, such as roads, new schools and hospitals, without paying any money up front — and thus keeping the level of current public debt lower than it would otherwise be.

Important but too little understood: the only clear 'advantage' to 'investing' in public services via private money is to massage the books. If Government borrows to build a new hospital it shows up as debt but if it buys in healthcare from a new private hospital it doesn't.

— Jo Maugham (@JolyonMaugham) July 9, 2024

In 2018, The Independent reported that PFI had ended up burdening the State with more than £300 billion in debt — for infrastructure projects with a face value of £54.7 billion.

“An Ideological Extravagance”

Since leaving politics, Milburn has feathered his and his family’s nest with millions of pounds from corporations with interests in the UK’s healthcare sector. His advisory business advises the US health insurance giant Centene Corporation, which in 2021 bought up 58 GP practices in London, with approximately 500,000 patients. He is chair of the advisory board at private equity group Bridgepoint Capital, which owns one of the UK’s largest external providers to the NHS.

Milburn is also an adviser to British health tech firm Huma Therapeutics and has chaired the Health Industry Oversight Board at PriceWaterhouse Coopers, the world’s largest accounting and consultancy firm. Milburn described his role as  “bring[ing] together a panel of industry experts to drive change across the health sector and PwC’s growing presence in the health market.” Coincidentally, PwC was extensively involved in the negotiation of many of the PFI deals during Milburn’s term as health secretary.

Milburn’s passion for the privatisation of NHS remains undimmed. In 2015, he even lambasted the then-Labour Party leadership’s plans to save the NHS from privatisation, prompting accusations that he was putting his own business interests first. Three years ago, he described “hostility to the use of private sector capacity” as an “ideological extravagance the nation cannot afford.” As the satirical magazine Private Eye noted, “it is also an ideological extravagance that runs counter to his business interests in private healthcare.”

Since standing down in 2010, media organisations have treated Milburn as an eminence grise on healthcare issues. Yet as Open Democracy‘s UK health and social affairs correspondent Caroline Molloy points out, those same media organisations consistently fail to mention his “long standing corporate interests… in carving up the NHS among private ‘providers,'” leaving  the public with the wildly mistaken impression that Alan Milburn is simply a well-regarded, well-meaning former health secretary with no hidden agenda or skin in the game.

If given a role in the new government, will he divest of those business interests? Presumably not.

It’s the same story with Tony Blair’s insistent calls for the NHS to sell off its patients’ data to third-party companies. From our article, Tony Blair and His Associates Are Waiting in the Wings to Take Back Power in UK:

TBI’s principal donor is Larry Ellison, the world’s fourth-richest man and owner of the Silicon Valley giant Oracle which aspires to become the world’s most important online medical data company using its cloud technology. In 2022, Oracle bought the US electronic health records giant Cerner last year for $28 billion. The company’s ultimate goal is to build a united national health database amalgamating thousands of separate hospital databases.

Blair’s financial ties with Ellison clearly represent at least a potential conflict of interest and one that should be at least disclosed in any interview, article or report discussing Blair’s calls for NHS patient data to be sold to third party companies — which could, of course, include Oracle. It also goes without saying that issues around digital technology (digital vaccine certificates digital ID, CBDCs, biometric identifiers, digital censorship, digital health data…) will feature heavily in a Starmer / Blair 2.0 government.

Gradual Hallowing Out

Of course, the NHS will not be sold off in one day, as happened to British Gas or Royal Mail. It will happen bit by bit, as part of a piecemeal hollowing out that has been going on for decades — arguably going all the way back to Thatcher’s decision to vigorously apply the principles of New Public Management across the welfare state. The plan was to decentralise decision making and introduce competition, with the state becoming a purchaser, rather than a provider, of welfare services.

Since then, the ongoing privatisation of the NHS has come in many guises, notes the campaign group Keep Our NHS Public. They include:

• The much-vaunted “marketisation” of health (when the NHS began moving to a more market-like environment emphasising choice and competition);
• The tendering of contracts for services, and making them available to private companies. An investigation by the British Medical Journal in 2014 found that roughly a third of the 3,494 NHS contracts it analysed, all awarded since the new legislation, had gone to the private sector;
• Private financing, such as the PFI deals, with no guarantee that hospitals paid for in this way will be in public ownership once the debts have finally been paid off with public funds;
• The inclusion of patients’ health data in trade deals.

The NHS’ patient data system is the largest repository of health data in the world and of huge potential value to tech, pharmaceutical and insurance companies.

As readers may recall, one of the most controversial acts of the short-lived Sunak government was to to hand the management of all NHS England patient records to Palantir, a tech firm  whose client list includes the US military, intelligence agencies and ICE, as well as the armed forces of the UK and Israel. Its co-founder and current chairman, Peter Thiel, described the British public’s affection for the NHS as “Stockholm Syndrome.” Speaking in an Oxford Union debate, he said the country “could rip the whole thing from the ground and start over” (as opposed to the slow death that successive UK governments have been subjecting it to).

As part of this slow-death process, it is likely that the lines between the NHS and private health care providers will become increasingly blurred in the coming years. Last Thursday, the day of Labour’s “landslide” election victory, the head of NHS Providers, Julian Hartley, called on the new government to allow the NHS to partner with private health firms and property developers to build new hospitals to reduce the care backlog. From The Guardian:

“Collaboration with public and private partners such as ethical pension funds, property developers, universities, private healthcare providers and local councils could unlock opportunities for NHS trusts keen to build new hospitals or redevelop existing sites which have been stymied by rigid Treasury rules.”

The piecemeal privatisation of the NHS will probably not result in patients being charged for healthcare at the point of service — apart from for specific services that users already have to pay for, such as eye tests, dental care, prescriptions and aspects of long-term care. Instead, the focus is on outsourcing NHS services — footed exclusively by the State — to private companies while gradually eroding the quality and availability of NHS services.

As is happening in many countries with deteriorating public health systems, including my country of residence, Spain, the inevitable result is a quiet exodus of middle class citizens into private health care. Mission accomplished!

So far, the pace of privatisation has been faster and more furious in England than in the other devolved nations of the United Kingdom. But all four nations are on the same path — including Scotland, which until now has resisted the shift toward privatisation more than its peers. But Labour just won a landslide north of the border, capturing 36 of the country’s 59 seats, as the pro-independence Scottish National Party posted its worst showing at a British parliamentary election since 2010. And ominously, Scottish Labour’s deputy leader Jackie Baillie has already expressed her full support for Streeter’s privatisation plans.