The Tory Plan to Undo the NHS

The Tories have tried to undermine the National Health Service since its creation. And now they’re attempting to privatize its services — making handsome profits in the process.

Britain's prime minister, Boris Johnson, reacts as he meets with NHS workers as they take afternoon tea inside 10 Downing Street on September 3, 2019 in London, United Kingdom. Daniel Leal-Olivas-WPA Pool / Getty Images

Earlier this month, Michael Gove denied Jeremy Corbyn’s claims that the public don’t trust the Tories with Britain’s public health service. “The NHS has been kept safe and well funded for most of its life by Conservative Governments,” he said, while Corbyn had been undermining the “wealth creators” who funded public services. “So please stow it.”

But what if we don’t “stow it”? In recent years, Conservative governments have overseen a massive increase in NHS privatization, with billions of pounds of contracts handed out to private providers. Meanwhile, waiting times in NHS hospitals are now at their worst level since records began – earlier this year, numbers showed tens of thousands of patients waited more than four hours for a bed. That’s quite a distance from the party’s pledge that the NHS would be “safe in our hands.”

This shouldn’t be a surprise – Tory resentment for the NHS has been there from the beginning. When Labour minister (and Tribune editor) Aneurin Bevan founded the NHS in the 1940s, Winston Churchill condemned him as a “squalid nuisance.” Churchill’s Conservative Party voted against the NHS’s creation twenty-two times, including at Second and Third Reading, alleging that the legislation “undermines the freedom and independence of the medical profession to the detriment of the nation.”

The Tories will argue that they supported a national health service, just not Labour’s NHS. But their objections to Bevan’s bill were telling. The Conservative Party preferred a health service that wasn’t centralized, in which doctors, nurses, and staff weren’t employed, which continued to rely on charity-run hospitals, and in which free provision was scarce. In other words, they opposed all those parts of the NHS that made it so popular.

To this day, the Tories resent the NHS. They don’t like that it is big, efficient, and popular: it undermines their arguments that market methods are preferable to public service. They have tended to both underfund the NHS and to try to break up state provision by handing as much of the NHS as possible to private firms. And if this wasn’t bad enough – top Tories have repeatedly tried to profit from privatization of NHS services.

Early Opposition

For thirty years after the foundation of the NHS in 1948, its popularity largely protected it from Tory reform attempts. But that consensus was broken by Margaret Thatcher’s free market politics. In 1982, Thatcher presented her Cabinet with a plan from her internal government think tank, the Central Policy Review Staff (CPRS). The CPRS plan would dismantle the welfare state, scrapping free universal health care, forcing people to take out private insurance, and charging for education. The CPRS report said, “For the majority, the change would represent the abolition of the NHS.”

Thatcher’s Cabinet rebelled and rejected the idea. Thatcher claimed she too objected to the CPRS plan – after it was leaked. But, in fact, she encouraged her ministers to keep considering ending the NHS. In 1982, Thatcher pressed her chancellor to look at the Omega Report, drawn up by the Adam Smith Institute, arguing for charging for NHS services and replacing them with insurance schemes.

Geoffrey Howe resisted, but Thatcher revived the plan in 1987. Health secretary John Moore might be forgotten now – but he was once widely seen as Thatcher’s favored successor. Moore launched plans to replace the NHS with insurance schemes, but he was met with a protest movement. In early 1988, the Tories faced a scrappy, grassroots-driven nurses strike over pay. It shook the government – “Thatcher Frightened of Meeting the Nurses,” ran one Times headline.

Fighting the strikes while trying to increase NHS privatization and cut NHS spending was politically impossible, and John Moore’s star soon faded. Unable to launch a full-frontal assault on the NHS, Thatcher and her successors “salami-sliced” public health care. And here, the plan to enrich their friends as part of NHS privatization came into play.

Making a Killing

Tory Lord Ashcroft is one of the party’s biggest donors to this day. He’s given millions over the years, including £600,000 since 2017, and he even owns Tory website ConservativeHome. Back in the 1980s, Ashcroft’s main business was heavily involved in contract cleaning. Behind the scenes, he lobbied for privatization of cleaning NHS hospitals and schools. Ashcroft gave around £500,000 to a group called PULSE (the Public and Local Service Efficiency campaign), set up in 1985 to promote the privatization of cleaning services.

The campaign’s advisory council involved a handful of right-wing Tory MPs, including Gerald Howarth, Neil Hamilton, and Michael Portillo. Thatcher’s government were happily persuaded and began the privatization. Peter Clarke, the man who ran the PULSE campaign, told the Scotsman newspaper that “nothing unlawful nor improper took place,” but that the venture “was very successful political engineering.” Ashcroft’s companies “prospered in the new market created by PULSE’s lobbying,” he said. “PULSE appeared to be a popular campaign but in truth it was a money-making venture for Mr Ashcroft.”

After privatization, the number of hospital cleaners dropped massively. Their wages and conditions were cut. Ashcroft also landed a big chunk of NHS catering services – before cashing in, selling most of his firms, and becoming a billionaire financier. He does keep a small stake, however: one of Aschroft’s companies, Impellam Group, runs temp agencies, including those supplying nurses and locum doctors to the NHS, profiting from shortages of health staff and the NHS reliance on private agencies.

Major Problems

After the salami-slicing of cleaning and catering services, Thatcher’s successor, John Major, continued the drive to privatize under the cover of his gray dullness. He introduced two key measures: first, the “internal market” of 1990, which introduced a for-profit structure to the NHS. The reform itself has proven inefficient and wasteful, but it has allowed private-sector suppliers to be easily slotted in through tendering processes.

Major also launched a private finance initiative (PFI), whereby the NHS sold its hospitals and used the money to rent back new privately run hospital buildings. PFI, which was also a favorite of New Labour under Tony Blair, wasted billions of NHS money on high charges, and handed yet more NHS cleaning, catering, and maintenance staff to private firms like Carillion.

But there remained significant differences between even the most right-wing Labour governments and the Tories when it came to the NHS. Then as now, Tory governments led to longer waiting lists, staff shortages, and shabby buildings. New Labour governments after 1997 repaired some of that damage by boosting NHS spending and recruiting more staff.

After New Labour was replaced by the Tory–Lib Dem coalition, the drive to break apart the NHS as a public, universal, and free service continued. The 2012 Lansley reforms fragmented the NHS, deepened the internal market, and made handing out private contracts even easier. The result: privatization has more than doubled since 2010.

Health-Care Profiteering

The pattern of senior Tories profiting from NHS privatization has continued throughout the last decade, too. Winchester MP Steve Brine was a Tory health minister from June 2017 to March 2019. In September, he took an extra job, on top of his MP work, as a strategic partner for Remedium, a private agency supplying overseas doctors to NHS trusts struggling with staff shortages. Brine will get £19,200 per year for sixteen hours work each month – or £100 per hour.

Remedium says it offers a better deal for the NHS because it supplies permanent staff from overseas, which would be cheaper than paying hourly rates to locum doctors. This may well be true, but a better supply and retention of UK NHS doctors would be cheaper still. Steve Brine served as a minister when Department of Health policies – including rising student debt, rising workloads, poor morale, and capped NHS pay – reduced the supply of UK doctors. Now he makes money from a company profiting from doctor shortages.

But the most notorious example of recent years relates to investor Ali Parsa’s health business, Circle Health. The Cameron government gave Circle Health a contract to run a whole NHS hospital, Hinchingbrooke, in 2011. At the same time, Circle employed a Tory MP, Mark Simmonds, as a £50,000 per year strategic adviser. Circle’s management of the NHS Hinchingbrooke hospital was a much-criticized failure, with the contract ending early.

Roll forward a few years, and Ali Parsa has a new business, Babylon Health, which tries to run NHS and private GP services over smartphones. Health secretary Matt Hancock has relentlessly promoted Babylon. At the same time, Babylon has entered into a controversial sponsorship deal with the Evening Standard, paying them an estimated £500,000 in return for favorable coverage. The Standard is edited by former Tory treasurer George Osborne – who gave Hancock his start in politics as a special adviser. Sure enough, Babylon’s sponsored series in the Standard included an interview with Hancock as health secretary, lavishly praising their products. The privatization of the NHS is a web of these kind of relationships between Tory politicians and their business friends.

The Coming Years

This Tory cabinet is the most right-wing in decades – and, unsurprisingly, looks longingly toward the United States, whose president lavishes praise on Boris Johnson as prime minister. The advantages of the United States from a Tory perspective are clear: a country with huge concentrations of wealth, no Labour Party, and a weak welfare state.

Their aim is to remake Britain in the United States’ image, with a major step being the proposed free-trade agreement that will follow Brexit. As the recent Channel 4 program Dispatches made clear, US trade objectives for any such deal include breaking NHS powers to buy US-made drugs at affordable rates. This would cost the NHS billions and enrich major drug companies.

But that is not the only danger of the trade agreement – with privatization also firmly on the card. The US trade objectives, published this February, say that any deal should “ensure that state owned entities act in accordance with commercial considerations with respect to the purchase and sale of goods and services.” This means that a state-owned entity, like the NHS, would be restricted in favoring NHS-owned hospitals as a “preferred provider” in future arrangements. The objectives also say that a deal must “increase opportunities for US firms to sell US products and services to the UK” through “government procurement.” The NHS is one of the largest bodies involved in that procurement process – which US corporations clearly view as a large, attractive market.

Boris Johnson has stacked his cabinet with MPs who dream of another thrust of Thatcherite free-market reforms. In 2011, Liz Truss, Priti Patel, Dominic Raab, Kwasi Kwarteng, and Chris Skidmore wrote a manifesto for a more radical Tory Party outside of its pact with the Lib Dems, titled “After the Coalition.” It advocated a health service where “two thirds” of hospitals “are run privately or not-for-profit” and argued that the NHS should “take advantage of the extra efficiencies private companies can provide.” Truss, Patel, Raab, Kwarteng, and Skidmore were the fringe in 2011. Now they are all ministers. It doesn’t take a genius to figure out what may be in store for the NHS if this Tory Party were to win the election.