Milburn, the NHS, and Britain's 'revolving door'

As the government ploughs on with its NHS ‘reforms’ in the face of opposition from medics and the public, whose interests are really driving these reforms? The latest move by former Health Secretary Alan Milburn provides a clue.

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Caroline Molloy
23 May 2013

PriceWaterhouse Coopers - the world’s largest accounting and consultancy firm - yesterday announced that it had recruited former Health Secretary Alan Milburn to head up a board overseeing its healthcare practice. Milburn commented  “…my aim is to bring together a panel of industry experts to drive change across the health sector and PwC growing presence in the health market.”

The move flags up PwC’s intention to take greater advantage of the expansion of health privatisation. It's a logical fit. Though driven most recently by the Health & Social Care Act, and started under Thatcher, NHS privatisation was of course helped on their way by some of Milburn’s own 'market' initiatives. Privatisation is already big business for PwC and the other ‘big four’ accountancy firms. Globally, PwC claim to have “acted on more privatisations than any other financial adviser, from steel and heavy manufacturing to utilities, public transport, health and education services.” They have been extensively involved in the negotiation of PFI deals in the UK.

Along with the rest of the ‘big four’, PwC has been taking advantage of the latest NHS restructuring to obtain public sector contracts. They received £852,875 last year to advise 6 CCGs in outer North East London. They advise on many outsourcing projects - sometimes paid by both sides on the same deal. They were paid £3m by Monitor, the main body regulating increased private sector involvement in the NHS, last year. And when marketisation goes horribly wrong, there is more money to be made - the South London Healthcare Trust paid PwC nearly half a million pounds for (ultimately unsuccesful) advice on how to survive a financial crisis caused in part by crippling PFI debts. PwC has also produced a recent report for the Department of Health advocating a massive expansion of IT in a ‘paperless’ NHS.

Faced with cuts hitting A&Es and nurses, the BMA and others have questioned whether such largesse gives the best value to a cash-strapped NHS (PWC’s average partner earned £679,000 last year).  

But Milburn’s appointment highlights a deeper concern. The revolving door between government and the private consultancies gives ample opportunity for political influence by the consultancies private sector clients. These clients include not just private healthcare firms and pharmaceutical companies, but telephone and IT companies, data collectors, private care home congolmerates, insurers and financial brokers.

The conflicts of interest don’t stop there. The big four’s activities in facilitating tax avoidance is shrinking the tax base available to fund public services like the NHS. And it’s not just Google and Starbucks - helping private healthcare companies to avoid tax is a core part of PwC’s offering.

In an increasingly marketised system, the opportunities for financial conflicts of interests are clear. It is curious that the media has chosen to focus on the conflicts of commissioning GPs. Whilst problematic, the sums involved are dwarfed by the huge fortunes to be made by the corporate clients of the big four currently embedding themselves at the heart of policy making.

It is a process PwC refers to as ‘thought leadership’, but George Monbiot calls the ‘shadow government’. Other big consulting companies like McKinsey and KPMG have been exerting their influence in UK health policy making for some time. Clearly, bringing heavy hitters like Milburn on board shows that PwC wants some more of the action too. Already, two ex-PwC employees sit amongst the seven directors of Monitor, and PwC funds interns for a number of politicians including several Labour front benchers.  

Of course whether the NHS actually benefits from PwC’s ‘outsourcing solutions’ lobbying and ‘tax solutions’ is no longer Milburn’s concern. When they leave office, government health ministers are of course free to work for who they choose. Milburn’s path is not unique. Patricia Hewitt, Lord Warner, and Tom Sackville have also chosen to hire their experience out to the private sector after leaving office.

Milburn has plenty to keep him busy. Aside from his new PwC role, he is also the chairman of the European Advisory Board of Bridgepoint Capital. Bridgepoint are the private equity investors behind Care UK - owners of many of the new 111 services which are going so badly wrong.

Where is the public interest in all of this?

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