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Manor Hospital (Walsall)

Volume 447: debated on Thursday 8 June 2006

Motion made, and Question proposed, That this House do now adjourn.—[Huw Irranca-Davies.]

I am pleased to have the opportunity to talk about the Manor hospital. I should explain that I applied for the debate because of the urgent and pressing need for major development work at the hospital, which is in my borough of Walsall. Until recently, it was expected that a private finance initiative contract would be agreed and that the work would begin early next year. Unfortunately, that has turned out not to be the case and there has been some delay. It is because it is essential for the work to be agreed so that it can begin in early 2007 that I thought it necessary to apply for a debate on the Floor of the House.

As I am sure the Minister knows, the three Members for the borough met the Secretary of State on 3 May. We briefly explained the situation to her and, of course, strongly urged that the work should be allowed to proceed. I should point out that the Manor hospital, which is the only acute hospital in the borough, provides a full range of hospital services for a population of some 253,000. It has 620 beds. The last major work took place 12 years ago when a new maternity unit was built, which was welcomed since it was essential. However, the rest of the site was built on a piecemeal basis from 1830 onwards. Given the deficits that some hospital trusts have experienced in recent times, I am sure that the Minister will be pleased to know that the Manor balanced its budget in the past financial year.

I am pleased that my right hon. Friend the Member for Walsall, South (Mr. George) is in the Chamber. He will be emphasising the same point as me. At present, 40 per cent. of the buildings on the hospital site are—to use a phrase that has become familiar in the past few weeks—not fit for purpose. It is a tremendous job maintaining those buildings and, obviously, a very expensive one as well.

I give the example of the hospital’s east wing, which was built in the late 19th century. It houses children’s services, women’s surgical wards, dedicated theatres and diagnostic facilities. The wing has a fire certificate until next year, and all the indications are that it is unlikely to be renewed. The three Members of Parliament, my right hon. Friend the Member for Walsall, South, the hon. Member for Aldridge-Brownhills (Mr. Shepherd) and myself, have seen for ourselves wards on the first floor of the east wing that can no longer be used because of their defects and lack of safety. It is most unfortunate that such accommodation lies empty for those reasons.

Coming to the present, much detailed work has been carried out by the hospital management in drawing up a scheme in line with PFI requirements. That was done so that, as I said, major investment work can start next year. Unfortunately, in the last few months, the hospital has learned that Treasury rules have been changed and that the contracts that everyone expected to be agreed have been delayed. That has, understandably, caused much anxiety. Will the work go ahead? Will we go into next year with no contracts signed and with the east wing as I described? One can understand the strong concern in the borough.

We are a borough known to some extent for our quarrels and difficulties—which sometimes reach national level—not only between political parties but, in some cases, within them, but we are unanimous in our view that this work should be carried out. We are very devoted to the Manor hospital. Even if this was not the case I would be saying the same, but I happen to be a former patient. When I suffered a heart attack in 1995, the hospital helped to save my life. I speak now as a Member of Parliament for one of the three constituencies in the borough served by the hospital, but I just put that on the file, so to speak. I know that my right hon. Friend the Member for Walsall, South has been an out-patient at the hospital on various occasions.

A hopeful sign—no doubt the Minister will deal with this—is the visit on 22 and 23 May of officials from his Department’s PFI unit. My understanding is that the hospital has proposed some variation in the scheme that would reduce capital cost, and some of the proposals discussed by the unit and the hospital management would mean that some of the work due to be covered by the PFI contract would be outside it. That is welcome. I should add that I am not a devotee of PFI contracts. I would rather things were different, but I am a realist, and if the only way major work can be undertaken is through PFI, so be it.

I hope that the Minister will be in a position today if not to say yes—it would be too optimistic of me to believe that—then to give some reassurance to the people in the borough that there is every possibility that the PFI contracts will be agreed to, with the fact that some of the work will be outside the contracts making the whole scheme more affordable. That is a hopeful sign, and I hope that the Minister will be able to take up what I have just said.

There is a wish that the matter should be finalised before Parliament goes into the summer recess, which will be in about five to six weeks’ time. Perhaps the Minister will be able to indicate whether the information, one way or the other, will be known to us by that time.

The three Members involved have met the Secretary of State, this debate is now taking place and we will continue to do whatever we can to sustain the pressure so that this vital work—I repeat myself deliberately because it is essential—can be started next year. No further delay can possibly be justified. I look forward, with some optimism, to the Minister’s response.

I am grateful to my close colleague, my hon. Friend the Member for Walsall, North (Mr. Winnick), for introducing this short debate. Our colleague, the hon. Member for Aldridge-Brownhills (Mr. Shepherd), has sent his apologies. This is a cross-party endeavour to ensure that a proper decision is made.

I know that the route towards PFI is strewn with delays and side-tracking. I can understand that. There is a history of rather difficult negotiations. I hope that at the end of the day, and pretty soon, the Department will acquiesce to the scheme proceeding. It is pretty obvious that there have been some disastrous PFIs. I understand why the Minister must be cautious. However, the problem is acute. As my hon. Friend the Member for Walsall, North has said, there is a crisis. Half of the buildings currently in the hospital could be annexed by the black country museum. They are part of the black country’s history. Yet the fire department has stated clearly that these buildings, despite new buildings over the past decades, will not be granted a certificate. It will be impossible for the hospital to continue to be occupied with buildings that could be open to being sued or brought to court. It has been put on a warning.

Not long after I was elected to this place in 1974, I recall beginning a campaign for a new Walsall hospital. In 1975, I think that it was David Ennals, who was from Walsall—the late Lord Ennals—who said that there would be a hospital. About 12 years later a new building was put up. It was an incredibly good addition to the site, which was getting rather elderly. Now, there is a crisis. The primary care trust and the hospital have got together on a number of important projects. It would be remiss of me not to say clearly and with pleasure that enormous improvements have been made since 1979.

However, there will be a crisis. The Government and the Treasury have changed the rules, in my view. Where Walsall hospital thought that it was on target to meet the Government’s requirements, now it is not. I spoke to Lord Warner a month or so ago, and I spoke also to the then Minister, my right hon. Friend the Member for Liverpool, Wavertree (Jane Kennedy). I was led to believe that my right hon. Friend would offer to meet not a delegation of Members putting an emotional case—the Secretary of State has already met the three Members involved—but a small delegation of specialists. I was told that there was a distinct possibility of that happening. There was to be a delegation of specialists—the chairman of the hospital, the chief executive, someone from the primary care trust and someone from the region—who could argue the case in detail for what we hope will happen.

We urge the Minister to use all the influence that he has with his colleagues to ensure that there is a continuation of negotiations with the hospital—there is an excellent team of people—to ensure that whatever is necessary is done, however rearranged, so that building work can begin. There is relatively high unemployment in the area and every index of poverty and deprivation is present in different wards. It would be appalling if the good work that the Government have been doing so far to enhance health provision in Walsall hit a brick wall—a brick wall that I believe has been put up unnecessarily.

I know that my hon. Friend the Minister has been well briefed. I hope that the pleas of two Members, together with those of our Conservative colleague, are seriously heeded and that the Minister, will make arrangements for a senior Minister, together with officials from the Department, to meet a delegation from Walsall, minus Members, to discuss the technicalities. I know that there have been meetings in Walsall with officials from my hon. Friend’s Department.

I hope that the promise that I believe was given by other Ministers will be kept and that we will be able in the few months that lie ahead to say that the building is on target. I hope that we shall see the good work of the Government enhanced even further, and that finally we shall have, for the first time ever, a hospital network and health services that are fit for purpose and meet the requirements of our constituents. I once again thank my colleague, my hon. Friend the Member for Walsall, North, for permitting me to participate in the debate.

May I begin by congratulating my hon. Friend the Member for Walsall, North (Mr. Winnick) on securing this debate? Both he and my right hon. Friend the Member for Walsall, South (Mr. George) have a long track record of promoting the proposed private finance initiative scheme for the Manor hospital site. As they said, together with the hon. Member for Aldridge-Brownhills (Mr. Shepherd), they recently met the Secretary of State to discuss the latest developments—a subject to which I shall return.

First, however, may I reiterate my Department’s continuing support for the modernisation of the Manor site? That support is not in dispute. The Manor hospital began life as the local Poor Law Infirmary, and it retains key buildings such as the east wing, which houses women’s and children’s services, and St. John’s block, both of which both date back, as my hon. Friends said, to the 1850s. The remainder of the site has been developed piecemeal over the decades, resulting in poor clinical relationships and functional unsuitability. More than 40 per cent. of the building stock is in an unacceptable physical condition and fails to meet health and safety requirements.

As my hon. Friends pointed out, West Midlands fire service has told the trust that it is unlikely to be able self-certify fire safety arrangements on the east wing after December this year. Even now, the wards on the first floor of the building cannot be used because of concerns about structural safety. The situation has increasingly hampered the trust’s efforts further to improve patient services and efficiency. Walsall Hospitals NHS Trust has an impressive track record of maintaining low waiting times for out-patient consultations and elective surgery. Indeed, it has the lowest waiting times in the west midlands, which should be a source of pride to my hon. Friends. The trust has had its busiest year ever, treating 20,000 more patients. As my hon. Friend the Member for Walsall, North said, it is financially stable and broke even in 2005-06 after it repaid some of its brought-forward deficit.

As everyone agrees, the key to further improvements lies in the more efficient working practices that have been designed as part of the new scheme, but they are unlikely to be realised until the new facilities are in place. That is why, in early 2001, the Government approved the initial strategic outline business case for the redevelopment plans that will be taken forward under the PFI initiative. There was a delay in moving to the next stage—approval of the outline business case—as the scheme had to be reconsidered as part of a wider Wolverhampton and Walsall joint service review. As a result, a revised proposal was submitted, which was approved by Birmingham and The Black Country strategic health authority, resulting in the scheme going to the market in October 2004. Despite further detailed service development work, the trust was able to issue invitations to tender and received two successful compliant bids just over a year later in October 2005 from the major consortiums Skanska Innisfree and Carillion. Following further evaluation and negotiation, the trust was poised to appoint its preferred bidder just before Christmas.

As my hon. Friends mentioned, at the beginning of this year we announced a review of all the major PFI schemes currently in procurement, which included Walsall. We did this in spite of the proven track record and success of PFI to date, because we wanted to make sure that the latest schemes properly took account of the current reforms to the NHS, such as the choice agenda, the movement of services into primary and community care settings, the new financial regime—the national tariff—and assumptions about efficiency gains and long-term affordability. A team from the Department has therefore been visiting every relevant trust to work with it on this task. As hon. Members know, the team first visited Walsall in early April and a follow-up visit, as we heard, took place at the end of May.

That brings me back to the latest developments. The trust had concluded that, as previously configured, the scheme was unaffordable. It thus undertook a root and branch review to ensure maximum flexibility and, wherever possible, to reduce costs. As my hon. Friends know, the outcome has been very encouraging, as the trust’s new proposals significantly reduce the annual payment to the private sector partner, with minimal disruption to the core service elements of the scheme.

It is worth reflecting what the key savings are. They arise, first, from postponing the permanent replacement of wards in the south wing and instead, using a high quality modular building to provide a short-term replacement for a minimum of five years, which will allow the trust to make further efficiencies in bed numbers or totally review its requirement at phase two; secondly, from working with the primary care trust with the aim of the PCT contributing to the funding of the diagnostic and treatment centre element of the scheme or delivering some of this activity in the community; and thirdly, from removing some of the support work and services from the scheme, such as the managed equipment service and ancillary services, which will continue to be provided in-house by the trust.

It is important to emphasise to my hon. Friends and to the House that these are only proposals at this stage. More work is needed on finalising costings and seeking agreement with key stakeholders such as the PCT, as I have mentioned. The success of the proposals also depends on securing an alternative source of capital for the new modular building and the demolition of the south wing—a total of £13 million, to be specific.

I am delighted to be able to announce in the course of the debate that the Department yesterday agreed to make £13 million available for this purpose, and we have written to the trust and the SHA this morning to that effect. Release of this funding will, of course, be conditional on the submission of a robust and affordable business case. I know that my honourable Friends will be very pleased to hear this news, as it also addresses a matter about which I know they are concerned—the urgency of the situation, which they mentioned in their contributions. I know that uppermost in their minds is the condition of the east wing, which, as I said earlier, the trust may not be able to self-certify for fire safety beyond the end of this year. The aim is for the women’s and children’s services to decant from the east wing to the new modular buildings replacing the south wing. That can now go ahead as part of the main PFI works programme or separately and sooner, should that be necessary.

The fact that the money has been released owes much to the advocacy of my hon. Friends and their championing of the cause directly to the Department and to Ministers in recent months. I know that the community in Walsall, which cares passionately about the hospital, will be pleased with the early good news.

Under the PFI review we expect the more advanced schemes such as Walsall to have finalised their revised proposals within a month or so. Those will then be considered by the Department of Health and the Treasury, alongside the progress that trusts have made in securing the best commercial and contractual terms with their bidders, which of course influences the overall cost of a scheme. We expect to be able to announce our decisions before the end of the summer.

In conclusion, as a consequence of the debate this evening, I will log the request by my hon. Friends for a meeting of representatives of the hospital with Ministers and officials in the Department, but we want that meeting to go ahead only if it is absolutely necessary. The ideal scenario, in terms of the progress that has been made in recent weeks, would be for the local partners to continue doing exactly what they have been doing and to finalise a bid with the Department, with all the necessary component parts, as quickly as possible.

My right hon. Friend the Member for Walsall, South (Mr. George) and I are very pleased by the Minister’s announcement of the £13 million. It goes without saying that that is good news much to be welcomed by the hospital and the wider community. The Minister referred, as expected, to the east wing. While the £13 million is useful, and we are very pleased, grateful, and whatever other words are appropriate, it is essential that the major investment—about £160 million in total—starts next year. When are we likely to have the information? What does the Minister mean by the end of the summer—the beginning of the summer recess, a little later, or what? Can he give more precise details?

I should make it clear on behalf of the Government that we would not wish to establish a precedent whereby whenever hon. Members ask for an Adjournment debate, £13 million is made available within 24 hours.

The serious point is that I would like this matter to be resolved before the summer recess. That is my hope and objective. We want to respond positively to the representations that my right hon. and hon. Friends have made on behalf of their communities and constituents, and we will do everything possible to make that happen. However, we depend on the local partners playing their part in ensuring that all the required work is done appropriately. If that happens, I assure my hon. Friend that we will do everything possible to ensure that we can give my hon. Friend the news that he requested before the summer recess.

I believe that the news for Walsall is very positive. There is a little way to go, but a lot of progress has been made in recent months, and there is every cause for optimism.

Question put and agreed to.

Adjourned accordingly at twenty-seven minutes past Six o’clock.