Norman Lamb: Mid Staffs would never have happened at a mutual

The care and support minister’s comments, made in an exclusive interview with HSJ, came as the Department of Health begins a review into staff engagement and empowerment. It will look at how greater use of mutuals and social enterprise could improve care quality.

The review will be led by King’s Fund chief executive Chris Ham. It will identify models for engagement and empowerment, making recommendations about how they can be more widely adopted. There will be a strong focus on the use of mutuals and social enterprises.

Mr Lamb said: “We need to be willing to look at all the different [care] settings. We’ve seen [mutuals and social enterprises] in community services - could the principle be applied to an acute hospital?”

He added: “I think it’s worth exploring the opportunities for extending it into areas that haven’t hitherto [used mutuals] - could you have a mutual foundation trust, for example?”

Mr Lamb argued the leadership failures seen at Mid Staffordshire would not happen in a mutual. “At Mid Staffs you had bullying managers who tried to drive through some pretty irrational changes internally.

“You can’t do that in a mutual. It couldn’t happen as it happened in Mid Staffs. So I think this compliments the [government’s] response to the Francis report.”

Mr Lamb said Mid Staffordshire staff “took their eye off the ball of what they were there for – caring for patients”.

He said: “I don’t think there’s any evidence anywhere of any organisation that’s become a mutual ending up less focused on the service that they’re providing.”

The minister also said that staff felt they had a stake in their organisation it resulted in better quality, higher productivity and lower sickness absence rates.

The model represented an “attractive alternative to the private sector”, he said.

The current and previous governments have sought to extend mutuals’ role in providing NHS services. Encouraging the use of social enterprises to deliver public services was a key element of the Conservatives’ “big society” policy at the last election. Health service staff are already able to set up their own social enterprises under the “right to provide” policy, launched by the DH in 2011.

Mr Lamb wants the review to look at barriers to this happening, although he said the work would not result in imposition of a particular model.

Professor Ham said employees could be given non-financial stakes in their organisation, as an alternative to financial. “It’s a sense of co ownership of the organisation. It’s a culture of ownership - a culture of mutuality can be as important as having a structure of mutuality,” he said.

Professor Ham will lead a panel of NHS and social enterprise experts carrying out the review, which will also include Julian Le Grand, who led the Cabinet Office’s mutuals task force, and University College London Hospitals Foundation Trust chief executive Sir Robert Naylor. It will report in April 2014.

Jon Restell, chief executive of Managers In Partnership, said the review was “very late in the day”, as it left just a year for the government to act before the next general election. He also questioned whether there was any evidence that mutuals really delivered improvements in culture or patient care.

“This is a focus on structure at a time when everyone is sick to death of structural innovation – this doesn’t seem to be a relevant response to the problems we have now,” he said.

Mr Restell added that staff that had set up mutuals in the NHS were now struggling to compete in a provider market dominated by big companies with more access to capital and more expertise winning tender bids. In 2011 Central Surrey Health, which had been cited by ministers as an example of a successful NHS spin out, lost out on an opportunity to expand when Virgin Healthcare beat it to a major contract covering other parts of the county. Many other community services mutuals’ contracts will be up at the end of 2013-14, and HSJ understands there is widespread concern among them that they will be outgunned by bigger commercial providers.

Howard Catton, policy head for the Royal College of Nursing, said there was no pent up demand among clinical staff to set up social enterprises. While there was support for the principles of social enterprises, which embody “the best traditions of the co-operative movement”, “people are equally concerned about the not insignificant risks involved in going down the social enterprise route.”

“If you’re relying just on organisational structure to deliver you staff engagement and shared decision making, I don’t believe that’s going to work,” he said.