Steve Bassam on the poor corporate practices of a company providing services across the NHS
At the start of December, NHS staff at the Royal Sussex County Hospital and the Princess Hospital Haywards Heath transferred to a private provider. The contract, involving 700 staff, covers portering, cleaning, catering, laundry, reception and retail – services for the most part previously provided in-house.
We have been down this route before in local hospitals and local authorities. In the 1980's and 90's the Thatcher and Major governments both forced through the privatisation of major services. Under Labour, many of these returned in-house often because of unreliable contract performance and sometimes because contractors went bust.
Labour introduced the concept of best value to replace the Tories’ compulsory competitive tendering. CCT (as it was known) had cheapened quality, with councils discovering that multiple contracts for services that needed to work together, such as street cleaning, refuse and recycling, meant poorer provision overall. Similar problems arose in health care, with management often unsure who was responsible for cleaning wards and ensuring clinical areas met the necessary high standards.
Today however, the Cameron government has decided that to reduce costs and make savings, the private sector should be used extensively to provide a range of support services. The Health and Social Care Act passed last spring opens up far more services to private companies.
It is against this background that Sodexo has taken the Royal Sussex and Princess Hospital support service contract. The company already provides faciIities management across the public sector, including defence, security, transport and the environment. Globally they employ 380,000 staff in 80 countries. In the UK alone, Sodexo has 37,000 staff and is growing fast in the health sector. The company website claims that they want to make 'everyday a better day' for clients and customers. Their mission statement says they have 'ethical principles' that inform everything they do – 'displaying business integrity, respect for people, transparency and loyalty'.
So why is it that since December they have abused the hard work and trust of those transferred over in Brighton and Haywards Heath? Just a fortnight into the contract, Sodexo announced plans to make 96 (14%) of the staff redundant. Soon after, concerns were being raised over short-staffing and managers were unable to find overtime cover during the Christmas period.
Staff at both hospitals get paid weekly: cleaners, housekeepers, receptionists, cooks and porters earning a basic £7.20 an hour, and probably less than £300 a week or £14,000 a year. This isn't pin money. They do it for a living and will often be the main breadwinner at home. It's not glamorous work but without them doing these jobs, nurses, doctors, surgeons and specialists couldn't function.
Five weeks on, Sodexo have yet to organise proper pay runs, with staff continuing to go unpaid, short paid, over taxed and taxed at the higher rate. Some who asked to be paid by BACS, when the money ran out, have seen those promised payments not made. One person was taxed so wrongly that after deductions they received no pay despite working full weeks. Others report that overtime has been missed or unreported, paid short or unpaid. During December, over 300 pay queries were made to the company.
It is hardly surprising that this has led to a loss of trust in management who seem unsympathetic to the problems their failure has caused. One young mother reported that she had to choose between finding her fare to work and feeding her young child, when short pay led to her money running out. Another staff member had difficulty proving they were in regular employment when seeking a new tenancy from a landlord. Many families were short of cash for Christmas and had to borrow from friends and family.
This is no way to run important hospital services – staff deserve to be treated with respect, whatever their job. Sodexo are likely to make a profit from this contract of around 10% over the lifetime of the agreement; and it is a very poor example for a company that will no doubt seek more work from the government’s drive to privatise health care.
In my view the local trust has a duty of care to staff and patients, and clinical standards could be compromised as a result of both poorly motivated and short staffing in two big hospitals. This is serious. Labour said it would happen, and the rest of the NHS has been warned. We need to be challenging this poor corporate practice and holding ministers to account for the mess they are creating.
Lord Steve Bassam of Brighton is a Labour Peer and a former leader of Brighton and Hove City Council
Published 7th January 2013