Easton’s move stokes debate on private sector’s value to NHS
Should Jim Easton be censured for his decision to quit a senior post within the NHS Commissioning Board in favour of the managing director’s job at private provider Care UK?
Should, more significantly, the system which allows senior public servants to move into the private sector be overhauled to slow what some see as a “revolving door”?
There is an important debate about the role of the private sector in helping deliver NHS services. The question whether the introduction of the profit motive undermines focus on patient care or supplies an incentive to improve standards will be a live one for the foreseeable future.
‘These leaders will not want or expect to leave the majority of public service values behind’
Then there is the issue of whether private involvement in support services should be treated differently from the managing or supplying of hands-on patient care.
One line of inquiry would simply ask if the private sector has anything to offer that cannot be provided by state-funded organisations and, if so, why NHS patients should not have the right to benefit from that service.
Crossing the floor
However, if we accept for the moment that private sector involvement is going to continue to grow (as it has done since the 1990s), then is it a good idea for NHS leaders to switch “sides”?
The three commonest objections against the kind of move made by Jim Easton are that: it will accelerate private sector influence in the NHS; it will give unfair advantage to a particular company; and that it somehow displays a lack of loyalty to the service that trained and promoted the individual.
The first objection is an honourable one to make and, as we have discussed, will be the subject of fierce controversy. The second objection might be termed “technical”. There are rules in place to provide a sufficient interval between a public servant leaving their post and taking up a position in a business which might benefit from their knowledge and contacts.
These rules need to be policed and if necessary their robustness challenged. The importance of “a level playing field” between sectors was highlighted during the Health Act’s passage through the House of Lords and resulted in Monitor’s ongoing review of the issue for the Department of Health.
The third objection is a matter of personal conscience.
The arguments for such moves are less often heard, but are no less significant. It is often claimed the NHS could do with an injection of private sector leadership skills. But there is little doubt public sector leaders tend to be better in key areas such as managing the bewildering range of partners, professional groups and other stakeholders involved in supplying health services. If the private sector is to play a more extensive role in the NHS, then having those skills in key suppliers is crucial.
Common language
It is also commonly said the NHS and private sector often fail to work effectively together because they “speak different languages”. The presence of more “bilingual” leaders should be welcome.
The size of the NHS means the private sector is always likely to draw much of its leadership from the service. Those “crossing the floor” will be clinicians, such as Bupa’s medical director and former primary care trust chief executive Paul Zollinger-Read, as well as general managers like Mr Easton.
These leaders will not expect or want to leave the majority of public services values behind along with their nhs.net email address. They will arrive at their new employers wanting to combine those principles with delivering the organisation’s objectives. Some will become disillusioned, others will forget their roots.
It is the proportion who can remain true to their beliefs while forging a successful career that may determine whether the NHS can benefit from an increase in private sector provision.
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Readers' comments (25)
Anonymous | 17-Oct-2012 12:48 pm
Good piece.
The detailed T&Cs in employment contracts will become more and more important.
How easy people from different sectors find it to move from one to another depends where you live, what job you do and other factors. I've moved a number of times but have plenty of colleagues who've found it difficult.
It also depends where you go. Care UK is very different from BUPA or KPMG or the pharmaceutical industry.
One of the most challenging things isn't just that this always happens during a big reorganisation but how the teams these people led feel, navigating an uncertain future.
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Anonymous | 17-Oct-2012 5:34 pm
At last a balanced piece - well done. Of the three areas of concern you can be sure the "technical restrictions" will be enforced to stop unfair advantage - the Procurement Police will see to that. As for the lack of loyalty to the NHS - managers in particular can be forgiven for having precious little loyalty towards a system which says goodbye to 40% of them and before you go please ensure a smooth transition to the new untried clinical leadership cadre . Yes they get paid well but most of these senior figures really care ( I know it sounds corny) about what happens - these are not easy decisions. QIPP is a policital as well as an economic necessity but don't imagine responsibiity for one of the few measurable national targets was easy. As to the increased influence of the private sector in the NHS has anyone spoken to a CCG recently? Many of them are even more opposed to the private sector than Mr Burnham at the end of the last Labour adminstration, - apart of course from innovative primary care GP led providers who live in a mysterious "not the private sector" parallel universe where profit (and an absence of competition) is permitted for their kind but no one else - that is a bigger practical, current and continuing risk than a rampant private sector
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Anonymous | 18-Oct-2012 11:42 am
The 'profit motive' used to bash private companies is actually what drives efficiency and productivity and forward momentum. It is the same for all the GP's, they are trying to maximise the profit for their practice. I don't believe that a 'shareholder' looking for a return on investment over a long timeframe is any more ruthless than a GP trying to maximise their income.
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Patrick Newman | 18-Oct-2012 2:03 pm
Private v public sector in the NHS? I am still looking for the NHS factories that make MRI equipment or ambulances. It's where the line is drawn in the provision of day to day services and what kind of organisation to contract with - SME's v multinational corporations like Carillion who run the failing Stevenage Surgicentre. There is much naivety about the private sector and the NHS would do well to import some private sector procurement practices and expertise, shall we say kindly.
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Anonymous | 18-Oct-2012 2:58 pm
Can we just note that Jim Easton had actually helped implement the management cuts and come out on top via HR processes your readers have previously criticised in general terms if not their application to him. He's perfectly entitled to move but the notion that he owes no loyalty to the NHS is risible. Equally whether he jumped or was pushed his departure does seem, to use Alistair's word, somehow dishonourable. The service made him; he had a major responsibility to help bring it through its current challenges; and he had spent months encouraging others without his job security to put their all into supporting him and the service to meet those challenges. Now he is going to a less demanding role because,one must surmise, he was made a better offer and/or he had less confidence in the NHS successfully addressing its challenges than he had been communicating. Nothing improper but decent and honourable? To those not party to what may have been a difficult wrestle of conscience, it's impossible to know. However, I hope people in Jim Easton's position would equally understand if some, perhaps ill-informed, observers are left with no more than a hint of such a question in their mind.
Finally, turning to the 'technical' dimension, what do people live on during the year between jobs? Is a golden handshake permitted to be paid up front? Presumably, there can be no question of a golden goodbye of any kind from the NHS? What contact is permitted between the individual and their new employers over that time and how on earth can the rules, whatever they are, be enforced? Just some questions of general applicability I've never really thought of before but prompted by Alistair's excellent, thought provoking and dispassionate column
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John Lister | 18-Oct-2012 3:28 pm
The simple question is whether the former public servant will be able to hold down a job in the private sector, which revolves around profit and promoting the narrow interests of shareholders, without signing up for its values.
The track record is not brilliant: Mark Britnell has become a leading exponent of private sector methods after defecting: it's hard to think of anything much that has been done by former NHS leading lights that demonstrates any continuing commitment to public services and their ethos.
The bigger question is whether while contemplating jumping ship some of those who intend to go might be tempted to line up an even fatter pay cheque for themselves by importing some of the private sector methods to the NHS, and of course taking all their contacts and knowledge with them.
My respect is reserved for those who stay at their post in the public sector and work to make it succeed, not those who take the grubby dollar from the private sector to help undermine the services they once worked to build.
At the end of the day we are still waiting for any evidence that the growing inroads of private providers is doing anything but undermine and weaken public sector provision, rip off taxpayers and generate a burgeoning, if largely impotent, army of "regulators" seeking to stop them doing what comes naturally, and make them deliver decent services to patients rather than line the pockets of shareholders.
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Anonymous | 18-Oct-2012 5:42 pm
I struggle with the concept that working in the private sector means that your are anti-NHS. It is a reasonable intellectual and practical position to work in the private sector and believe the best care is delivered through a mix of public and private enterprise. Not least because 'contestability' means public providers become motivated to keep their skills, efficiency and crucially co-operation with the rest of the system high.
I think dismissing concerns over moves from public to private sector as merely 'technical' betrays its importance. I don't believe they're being enforced and I believe taxpayers overpay because selected providers have an 'in'. Confidential tenders to long-forgotten frameworks are all-too common and sidestep the competition that was the primary rationale about private sector involvement.
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Anonymous | 18-Oct-2012 6:58 pm
Worked for Care UK for a while. There were a number of very earnest people who felt they were working with the NHS rather than against it. What was shocking is the naivete that they are not pawns in a game where those who will make squillions from NHS contracts are the suits from Bridgepoint Capital and a very selected number of senior management who have been allocated shares. It is the potential for obscene levels of reward reminiscent of the worst excesses of the City that poisons Care UK's bona fides. Care UK is no John Lewis partnership or a social enterprise. What amazed me is how carefully and cunningly the real reason for Care UK's existence was camouflaged.
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Anonymous | 18-Oct-2012 7:44 pm
If we are being honest, Mark Britnell disappeared from our radar when he joined KPMG. Not sure what he has done since really, which is sad. His influence has diminished and he has become a commentator instead of the player on the pitch that he deserves to be.
As for Jim Easton - he was always the man behind the Nicholson Challenge, the £20bn QIPP requirements. QIPP has belly flopped tremendously - no-one in the service, and I mean NO-ONE gives it any credibility at all. We simply report the numbers the upward chain want to see, and if we don"t we are told to resubmit anyway, and so the thing goes on. I cannot see any excitement for Easton in continuing to bang the drum of doom for the next CSR period. Fed up of re-enacting the Emperor's new clothes, he is off to make a fast buck and ride out this crazy period of transition until we all wake up a decide to do something else me thinks (like abolish the internal market, integrate health and social care provision and commissioning at a local level, and wow - you then may actually REALLY be able to see that one from space, or from Wales, Scotland or Northern Ireland who all for once have seemed to get there before us).
For now, let the boys Britnell and Easton play, whilst the rest of us mugs carry on trying to polish the very turd that our outgoing SoS left behind.
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Phil Kenmore | 19-Oct-2012 9:14 am
I loved reading this excellent piece whilst glancing at the IBM ad on the top of the page - then going back to the main screen to see the one from a pharma company.... The NHS seems so tied up in the love-hate thing with the private sector that sometimes it perhaps can't see some of the irony. Its a symbiotic relationship - the NHS would fail without private suppliers (of services and products) and the private sector would likewise without the NHS as a market.
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Anonymous | 19-Oct-2012 11:58 am
'Switch sides'? Is Jim Easton supposed to be the reincarnation of Benedict Arnold? He will probably benefit patients more at Care UK than he was ever going to do in his current job.
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Anonymous | 19-Oct-2012 1:01 pm
Anonymous 7:44 PM. At last someone says it like it is. See the anodyne defence of QIPP from Nusrat Latif on the other Jim Easton thread. When it was pointed out to her that she has an obvious conflict of interest organising the annual QIPP conference, her next post was headed 'cyberbullying' !
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A Harris | 19-Oct-2012 1:55 pm
The point about the technical rule is that there does not appear to have been a 'reasonable' time-lag between his DH strategic role and his Private strategic one.
Anybody out there that does not believe there will be advantages for Care UK above other competitors including the NHS is not being realistic.
The unique aspect of Jim Easton to Care UK is the influence he can put to their advantage and I can't blame them for that, but it does not settle easy in the stomach knowing there is this advantage.
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Anonymous | 19-Oct-2012 2:59 pm
Sorry 1.01 for being thick, why is organising conferences about QIPP a conflict? If that's her job and she believes in it (hard to take a post where you don't have confidence in whatever you're doing), isn't that what you'd expect? I organise partnership working and I'm an advocate of it, I'd find it hard not to!
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Anonymous | 20-Oct-2012 9:15 am
2.58, what happens in the private sector if you take a post with a competitor is determined by the T&Cs in your contract but most of the time, you go on immediate, paid gardening leave for your notice period. No redundancy or golden handshake. Your laptop, phone etc is couriered back the day you resign, and you're told not to do any work for the company and people are instructed not to contact you. You might then have a limited time during which you can't go onto payroll with your new employer (so you live on your savings) and caveats on e.g. you can't take the customer database with you because the IP belongs to your employer (even if you built it, you did so in your role with them). Moves happen often - some recruiters are even targeted with "get the best sales/ BD people from X" so HR policies are always very clear. Companies can and do take legal action against previous employees if they break the rules. So even in business, it's not to be taken lightly. And you can rarely go back if things don't work out. I've heard it happen a couple of times but they were the exception not the rule. Most people don't realise they're making a decision that will affect them in the long term.
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Anonymous | 22-Oct-2012 9:54 am
I agree that the article is well-balanced, and consequently readers' comments are measured and thoughtful. Unless Jim Easton tells HSJ why he has moved on from his NHSCB role we can only conjecture, and I think he will be chuckling at some of the theories put forward.
However all this ignores the real problem with the private sector, which is that public money (i.e. my taxes and yours) is diverted from funding public health care into the pockets of private shareholders. Irrespective of whether the pockets belong to GPs or to Bridgepoint Capital, the money is flowing out of healthcare into 'profits.'
The argument that it is the prospect of personal profit in the private sector that drives efficiencies is not a reason for privatisation. It merely describes avarice. The real argument for efficiency is to enable the 'savings' to be used for even more healthcare (or lower taxation,) and the private sector can never deliver this public benefit.
I fully accept that there are products used in the NHS that will rightly come from the private sector - ambulances for instance - but ultimately the more public money that is spent in the private sector, the more public money is bleeding out of the system and reducing public health care.
From now on, Jim Easton's salary will be devoted to him taking still more money out of public health care, not to increasing public health care; and there is a vast difference between the two.
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Anonymous | 22-Oct-2012 12:01 pm
Bridgepoint confirms successful completion of £250m high yield bond for Care UK acquisition
23 July 2010
A £250 million high yield bond issue has been completed as part of the £414 million acquisition and de-listing by Bridgepoint of Care UK. Citi acted as sole global coordinator and was, with RBS, joint physical bookrunner for the issue. Additionally, the company has put in place substantial facilities to support the future growth of its business.
Care UK works in close partnership with local authorities, primary care trusts and strategic health authorities, drawing on over 25 years of experience to provide tailor-made service solutions, including residential, community, specialist, primary and secondary care.
The company operates approximately 200 facilities across the UK and employs over 13,000 people, including surgeons, GPs, nurses and registered carers. Today it operates 59 homes for older people and provides over 119,000 hours of care and support every week to people in their own homes. The Care UK Group also offers independent supported living services for people with learning disabilities as well as services covering a range of mental health needs. It also operates a range of specialist children's services including residential care and fostering. In the health sector Care UK delivers a wide spectrum of services, all to NHS patients. The Care UK Group is the largest operator by patient volumes of independent sector treatment centres in the UK and operates a number of primary care services including GP practices, walk-in Centres, GP out-of-hours services and prison health, as well as Clinical Assessment and Treatment Services.
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Anonymous | 22-Oct-2012 4:44 pm
Look at the big picture. What happens to private sector profits? A small proportion goes to rich people but the vast majority goes to pension funds. Whilst NHS people are very lucky and get their pensions paid directly by taxpayers most of those taxpayers themselves (eg the ones making ambulances) aren't so lucky so they need a private pension from the likes of Aviva, Prudential etc who will generate the pensions through investments in major companies and funds like Bridgepoint Capital. It all goes round in circles and whilst a few rich people take a disproportionate share their share is still only a small part of the whole.
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Anonymous | 23-Oct-2012 10:53 am
We are not stupid. The whole point of big business is to make big profits.
Pension Funds, on behalf of their members, will always try to seek the highest returns, so if they are buying up private healthcare shares it proves that lots of money is draining out of the NHS. Just because pension funds hold private healthcare shares does not make the profits ethical, any more than holding tobacco shares makes them ethical.
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Anonymous | 23-Oct-2012 12:53 pm
The problem with some of this debate seems to be the underlying premise to many of the comments that all 'profit' is unethical. We should remember that the vast majority of our population works in the private sector and the vast majority of people behave ethically to provide good products and services from their organistions in order to make a decent living to pay their mortgages and bring up their children etc. These same people have ambitions to earn more and be successful for their families just like people in the private sector. Profit funds this and allows people to grow and support others.
NHS workers pay, pensions and benefits are paid for by the hard work of taxpayers and the very same seeming dirty unethical profit that keeps most of those taxpayers in work.
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