Government to appeal Lewisham Hospital ruling: urgent questions for Jeremy Hunt

On Saturday 14 September the people of Lewisham will host a victory parade and party to celebrate the High Court ruling which – for now at least – has saved their hospital. By the standards of judicial language, this ruling was pretty robust. The judge quashed Hunt’s decision to downgrade Lewisham’s A&E and maternity services, making it emphatically clear that the Health Secretary had no legal power to do so.

Unfortunately, Jeremy Hunt has spoiled Lewisham’s party by confirming on 22 August that he will appeal against the ruling. The hypocrisy of this decision is staggering. This government has been highly critical of workers who pursue weak employment tribunal cases on the off-chance of success, relying on taxpayers to fund their one-way bet against their employers. Hunt’s decision to appeal is no different.

As the legal process drags on, the staff and patients of Lewisham Hospital must continue to live with destabilising uncertainty. Hunt has a duty to them, to taxpayers and to Parliament to set out the grounds on which he thinks the High Court has erred and why he thinks an appeal is an acceptable use of public funds.

The case against Jeremy Hunt

The origins of this case lie outside Lewisham in the neighbouring South London Healthcare Trust (SLHT). The SLHT had become financially unsustainable, losing £1m a week due to crippling PFI contracts.

Lewisham Hospital, by contrast, was – and still is – a highly successful, solvent hospital which is part of a separate NHS trust, the Lewisham Healthcare Trust. It had nothing to do with SLHT’s financial difficulties, but this did not stop Jeremy Hunt from approving recommendations to downgrade services at Lewisham as part of the ‘solution’ to the problems in the SLHT.

There are two relevant ways set out in law by which the Secretary of State for Health can deal with problems such as those in the SLHT. The first is a broad power under section 8 of the National Health Services Act 2006 (the 2006 Act) which allows him to give any direction concerning the functions of NHS bodies. This power comes with a counterbalancing duty to consult with a wide range of affected parties.

The regulations governing this consultation are detailed and the process normally takes two years or more.  In addition, any reconfiguration of services must meet the government’s own four tests, including obtaining support from the relevant GP Commissioners.

The second way to deal with a failing NHS trust is the Unsustainable Providers Regime in Chapter 5A of the 2006 Act. It was this method that Hunt chose for the SLHT. This regime, described as an ‘exceptional bespoke procedure’, is designed to deal quickly with failing NHS organisations.

Under the Unsustainable Providers Regime an administrator is appointed to run the failing NHS trust and to make recommendations for its future to the Secretary of State. The administrator must consult with specified parties connected to the trust; there is no obligation to consult any party outside the failing trust. These consultation obligations are deliberately less onerous than those under section 8 so that failing NHS organisations can be dealt with rapidly. There is also only a duty to ‘have regard’ to the four tests for reconfiguration, not to meet them.

Chapter 5A defines the powers that could be legally exercised by Jeremy Hunt in respect of the SLHT and other hospitals such as Lewisham. The key sections empower the Health Secretary to take actions ‘in relation to the trust’ (‘the trust’ being the failing trust in question.)

The meaning that Parliament had intended to give to the words ‘in relation to’ formed the crux of this case. Lewisham contended that they clearly referred to the failing trust and no other, meaning that the only hospital services that Hunt could lawfully change were those in the SLHT.

Hunt’s failed defence

The government argued that the words ‘in relation to the trust’ were intended to have a broad meaning, allowing actions to be taken in respect of any NHS trust which had an ‘appropriate connection or relation to the trust in question.’ Lewisham Hospital fell into this category, it was argued, because it was in a neighbouring trust.

Government lawyers argued that NHS trusts do not operate in isolation and that problems in one were ‘overwhelmingly likely to involve neighbouring trusts.’ This, they submitted, meant that solutions were always likely to involve neighbouring trusts and that Parliament would never have intended to limit solutions to the one failing trust.

In essence, Hunt was arguing that the Unsustainable Providers Regime was intended to give the government almost identically broad powers to those already available under section 8 but with almost none of the safeguards.

Government lawyers also highlighted the statutory guidance for the regime which states that property of the failing trust can be transferred to neighbouring trusts. This, they argued, showed that neighbouring trusts were intended to be part of the solution under the regime.

Even if his actions under Chapter 5A were deemed unlawful, Hunt argued that his decision could not be quashed because he would have reached the same result under his section 8 powers.

Decision

The judgement gives a long list of reasons why the words ‘in relation to’ only refer to the failing trust and not to any of the eight trusts in South East London. I have summarised some of the most striking arguments below, but they are all worth reading in full (see paras 76-94).

1)      The words ‘in relation to’ are used over 200 times in the 2006 Act and there are examples where they clearly limit the meaning to a particular person or period. For example, the words ‘in relation to a person’ can only be referring to that one person. Applying the ordinary rules of statutory construction, the same words will have the same meaning wherever they are used in an Act.

2)      The administrator is only obliged to consult with parties connected to the failing trust. It would be very strange if Parliament had intended to give the Health Secretary the power to change services in the failing trust and all neighbouring trusts but then only require consultation in one of those trusts.

3)      The fact that Chapter 5A specifically allows for the transfer of the failing trust’s property to other NHS trusts is an argument in favour of Lewisham’s case, not against. The judge said that the Unsustainable Providers Regime is a ‘carefully drafted regime’; it is therefore highly significant that this power is specified but the power to change services in neighbouring trusts is not.

4)      The use of the singular in the statutory guidance strongly suggests that only changes to the failing trust were envisaged. For example, it says that trust administrators should make final recommendations…about what should happen to the organisation and the services it provides.’

5)      Hunt could have used the section 8 procedure but instead he chose the Unsustainable Providers Regime. When designing this regime, Parliamentary draftsmen had to balance the requirement for speed against the significant reduction in patients’ rights to be consulted. Limiting changes to the one failing trust balances these competing interests.

The judge also discarded Hunt’s contention that his decision shouldn’t be quashed because he would have reached the same conclusion under section 8. This was dismissed on numerous grounds, most notably that the ‘four tests’ were not met as the relevant GP Commissioners did not support the reconfiguration and that the legal consultation requirements under section 8 had not been followed.

The parade on 14 September may be more protest than party, but the message to Jeremy Hunt will be clear: the people of Lewisham will fight you all the way.

2 Responses to “Government to appeal Lewisham Hospital ruling: urgent questions for Jeremy Hunt”

  1. John Hamilton, LPBP

    A well e xplained, succinct article. Thank you, Annie Powell. Unfortunately one of the TSA’s other recommendations was that Lewisham and Greenwich merge and become one trust. This means that the PFI debts of the Queen Elizabeth Hospital in Woolwich will now bring down Lewisham as well, in time. Activists from Lewisham People Before Profit believe that the only long-term option for the hospitals in the former South London Healthcare Trust, and indeed for the whole NHS, is for these extortionate PFI contracts to be annuled. The PFI beneficiaries in the case of Greenwich have already made a whopping 220% profit on their outlay in 1999 – we think they’ve had enough of our money and that the remaining £700m that is owed over the next 17 years should not be paid. Renegotiating the payments should not even be considered – these vultures are paving the way for privatisation of the NHS – probably what Gordon Brown intended when he insisted on PFI back at the turn of the century.
    To those in the Save Lewisham Hospital campaign who imply that Labour is the answer, one only has to ask Ed Balls what he thinks of PFI.

  2. JosBell

    A very good clear piece Annie – and yes, a key point is that Lansley appointed Kershaw under the aegis of the Section 5A TSA legislation and his successor Hunt then supported Kershaw in hopping over the road into neighbouring Lewisham, stretching the legislation until it pinged back at him like a piece of snapped elastic. He could instead have opted to apply Section 8 which bestows much broader powers, but instead left that in the realms of a hypothetical ‘if only’,leaving his July legal team with a very empty argument.

    Far from there being an economic benefit to dismantling Lewisham services, it will cost twice as much to demolish 60% of the Lewisham Hospital site as planned by Hunt then it will to keep it. The loss of services apart, the land sale shows an immediate loss of £50million and the overall cost of the re-configuation is £1.093 billion, which is by no means the cost saving that Hunt has pretended. Moreover the debts would continue to exist in 30-40 years while local services become even more profoundly overstretched, resulting in avoidable deaths.This is predominately the reason to battle on with the fight for the Lewisham site and demonstrates that these plans are more about an assault on the NHS than they are about creating decent hospital services for a densely populated area.

    Meanwhile the comments from John Hamilton require some clarification as local people in particular should be given the full picture with respect to the forthcoming merger.

    1. Lewisham Hospital from the outset offered to take the troubled QEH Woolwich under its’ wing – this was not a TSA device but a sensible solution to consolidating local services through local knowledge based management. Had Lansley and Hunt listened to this offer, they could have avoided both the vociferous protests and high profile court cases.
    2 QEH Woolwich has a PFI ‘deal’ which was initiated under the Major govt and finally signed off in 1998 in the days when some in Labour did not look closely enough at the implications of a deal which vastly favoured the profit-greedy lenders and plays a significant ( 30%) part in the accumulated deficit of the SLHT. Lewisham Hospital is solvent with a small ( £12 mill ) affordable PFI based upon lessons learned and which was projected to be paid off within a manageable timescale
    3 The merger will not leave Lewisham with the accumulated QEH debts or without help in bringing the Woolwich PFI under control, but brings with it a sizeable chunk of funding to pay off the existing debts from QEH as well as an added subsidy to support QEH PFI payments. We can argue that taxpayers money would be better spent if only the PFI can be cancelled. This will never happen – however a renegotiation should be looked into, especially in view of the Libor scandal.
    4 The reality is that if Lewisham and Woolwich do not merge they will remain as unsustainable stand alone DGH’s which will quickly be forced into some kind of private takeover because they will fail to qualify for the now compulsory Foundation Trust status. The two sites have a much stronger chance of surviving and remaining an NHS facility by joining together. It would be foolish to oppose this as to do so actually does the opposite of saving Lewisham Hospital services – or indeed those at QEH.

    The managers of soon to be Lewisham and Greenwich NHS Trust are determined to manage the combined Trusts with the same rigour that has resulted in Lewisham being in the Top 40 Trusts for the past 5 years. The government should give them the chance to make that work instead of subjecting the joint workforce and population of SE London to this ongoing and unnecessary assault. Meanwhile we should give them a chance to succeed in making clinically advisable decisions for the greater good of SE Londoners.

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