A third of NHS contracts are going to private providers. Photo: Getty
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Since the government's reforms, a third of NHS contracts have gone to the private sector

"Fragmenting and privatising".

In terrible news for David Cameron, and a gift to Labour, a third of NHS contracts awarded since the government's health reforms have gone to the private sector.

The British Medical Journal analysed nearly 3,500 contracts awarded between April 2013 and August 2014, since the government's Health and Social Care Act kicked in last year, and found that 33 per cent of contracts had been handed to private sector providers.

These contracts are awarded by the controversial Clinical Commissioning Groups established by the new health reforms, led by GPs, which have the power to influence commissioning decisions for patients and organise the delivery of services.

Dr Mark Porter of the BMJ called the findings a demonstration of "creeping privatisation in the NHS since the Health and Social Care Act was introduced", and criticised the government, which he claims "flatly denied" that the reforms would amount to increasing privatisation.

This is a bad look for the Conservatives, for whom the NHS is already a toxic issue because of their unpopular restructuring. It also gives Labour the opportunity to continue its attack line that the Tories cannot be trusted on the NHS. The shadow health secretary Andy Burnham has jumped on this story and done just that:

These figures blow apart Jeremy Hunt’s claim that ‘NHS privatisation isn’t happening’. It is happening and it is happening on his watch.

This is because contracts are being forced out onto the open market by David Cameron’s Health Act. Labour believes in protecting the public NHS and will repeal the rules that are fragmenting and privatising it.

The NHS of the future demands more integration. The problem with this Government’s policy is that it’s taking it in the opposite direction, towards more fragmentation.

These figures show what is at stake at the coming election. David Cameron’s Government is stealthily hiving off NHS services without the permission of the public.

This is a strong point for Labour, because it has a tangible answer to Cameron's tampering with the NHS: repealing the Health and Social Care Act if it wins the election. And such a policy will chime with an electorate that faces further, more painful, cuts to its public services in the near future.

Anoosh Chakelian is senior writer at the New Statesman.

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The tale of Battersea power station shows how affordable housing is lost

Initially, the developers promised 636 affordable homes. Now, they have reduced the number to 386. 

It’s the most predictable trick in the big book of property development. A developer signs an agreement with a local council promising to provide a barely acceptable level of barely affordable housing, then slashes these commitments at the first, second and third signs of trouble. It’s happened all over the country, from Hastings to Cumbria. But it happens most often in London, and most recently of all at Battersea power station, the Thames landmark and long-time London ruin which I wrote about in my 2016 book, Up In Smoke: The Failed Dreams of Battersea Power Station. For decades, the power station was one of London’s most popular buildings but now it represents some of the most depressing aspects of the capital’s attempts at regeneration. Almost in shame, the building itself has started to disappear from view behind a curtain of ugly gold-and-glass apartments aimed squarely at the international rich. The Battersea power station development is costing around £9bn. There will be around 4,200 flats, an office for Apple and a new Tube station. But only 386 of the new flats will be considered affordable

What makes the Battersea power station development worse is the developer’s argument for why there are so few affordable homes, which runs something like this. The bottom is falling out of the luxury homes market because too many are being built, which means developers can no longer afford to build the sort of homes that people actually want. It’s yet another sign of the failure of the housing market to provide what is most needed. But it also highlights the delusion of politicians who still seem to believe that property developers are going to provide the answers to one of the most pressing problems in politics.

A Malaysian consortium acquired the power station in 2012 and initially promised to build 517 affordable units, which then rose to 636. This was pretty meagre, but with four developers having already failed to develop the site, it was enough to satisfy Wandsworth council. By the time I wrote Up In Smoke, this had been reduced back to 565 units – around 15 per cent of the total number of new flats. Now the developers want to build only 386 affordable homes – around 9 per cent of the final residential offering, which includes expensive flats bought by the likes of Sting and Bear Grylls. 

The developers say this is because of escalating costs and the technical challenges of restoring the power station – but it’s also the case that the entire Nine Elms area between Battersea and Vauxhall is experiencing a glut of similar property, which is driving down prices. They want to focus instead on paying for the new Northern Line extension that joins the power station to Kennington. The slashing of affordable housing can be done without need for a new planning application or public consultation by using a “deed of variation”. It also means Mayor Sadiq Khan can’t do much more than write to Wandsworth urging the council to reject the new scheme. There’s little chance of that. Conservative Wandsworth has been committed to a developer-led solution to the power station for three decades and in that time has perfected the art of rolling over, despite several excruciating, and occasionally hilarious, disappointments.

The Battersea power station situation also highlights the sophistry developers will use to excuse any decision. When I interviewed Rob Tincknell, the developer’s chief executive, in 2014, he boasted it was the developer’s commitment to paying for the Northern Line extension (NLE) that was allowing the already limited amount of affordable housing to be built in the first place. Without the NLE, he insisted, they would never be able to build this number of affordable units. “The important point to note is that the NLE project allows the development density in the district of Nine Elms to nearly double,” he said. “Therefore, without the NLE the density at Battersea would be about half and even if there was a higher level of affordable, say 30 per cent, it would be a percentage of a lower figure and therefore the city wouldn’t get any more affordable than they do now.”

Now the argument is reversed. Because the developer has to pay for the transport infrastructure, they can’t afford to build as much affordable housing. Smart hey?

It’s not entirely hopeless. Wandsworth may yet reject the plan, while the developers say they hope to restore the missing 250 units at the end of the build.

But I wouldn’t hold your breath.

This is a version of a blog post which originally appeared here.

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