A new world heaves into view this week with sweeping changes in the fields of welfare, justice, health and tax
Monday 1 April
Bedroom tax introduced
The aim is to tackle overcrowding and encourage a more efficient use of social housing. Working age housing benefit and unemployment claimants deemed to have one spare bedroom in social housing will lose 14% of their housing benefit and those with two or more spare bedrooms will lose 25%. An estimated 1m households with extra bedrooms are paid housing benefit. Critics say it is an inefficient policy as in the north of England, families with a spare rooms outnumber overcrowded families by three to one, so thousands will be hit with the tax when there is no local need for them to move. Two-thirds of the people hit by the bedroom tax are disabled.
Savings: £465m a year. As many as 660,000 people in social housing will lose an average of £728 a year.
Monday 1 April
Thousands lose access to legal aid
Branded by Labour a “day of shame” for the legal aid system, the cutoff to claim legal aid will be a household income of £32,000, and those earning between £14,000 and £32,000 will have to take a means test. Family law cases including divorce, child custody, immigration and employment cases will be badly affected.
Savings: a minimum £350m from £2.2bn legal aid bill.
Monday 1 April
Council tax benefit passes into local control
Council tax benefit, currently a single system administered by the Department for Work and Pensions, is being transferred to local councils with a reduction in funding of 10%. Council tax benefit is claimed by 5.9 million low-income families in the UK. The new onus on councils has come at a time when local government funding, according to the Institute for Fiscal Studies, has fallen by 26.8% in two years in real terms. A Guardian survey of 81 councils last week found many claiming they face difficult cuts, with almost half saying they were reducing spending on care services for adults. This also comes at a time when 2.4m households will see a council tax rise.
Savings: up to £480m a year, but depends on decisions of local councils.
Monday 1 April
NHS commissioning changes for ever
An NHS commissioning board and a total of 240 local commissioning groups made up of doctors, nurses and other professionals will take control of budgets to buy services for patients. They will buy from any service providers, including private ones so long as they meet NHS standards and costs. Strategic health authorities and primary care trusts disappear.
Costs: £1.4bn, mainly in redundancies, followed by savings as high as £5bn in 2015 owing to fall in staff numbers.
Monday 1 April
Regulation of financial industry changes
The Financial Conduct Authority and Prudential Regulation Authority, housed in the Bank of England, replace the Financial Services Authority. The Bank promises these changes do not represent the death and Easter resurrection of the same body. A new, proactive supervisory approach towards the City is promised, focused on outcomes rather than a tick-box culture. It has powers to prosecute, throw people out of the industry and withdraw a bank’s licence. Above all it monitors risk to the financial system as a whole.
Saturday 6 April
50p tax rate scrapped for high earners
Announced in the 2012 budget. George Osborne said the 50p rate, introduced in April 2010, caused massive distortions in 2010-11 and raised only £1bn, rather than the £2.5bn forecast by Labour back in 2009. HMRC found £16bn was deliberately shifted into the previous tax year, largely by owner/directors of companies taking dividends in the previous year when the highest rate was still 40p. Labour claims 13,000 millionaires will get a £100,000 tax cut.
Monday 8 April
Disability living allowance scrapped
The personal independence payment (PIP) replaces the disability living allowance and, according to the DWP, is not based on your condition, but on how your condition affects you, so narrowing the gateway to the PIP.
It will contain two elements: a daily living component and a mobility component. If you score sufficient points, a claim can be made. Assessments will be face-to-face rather than based on written submissions, starting in Bootle benefits centre, handling claims across the north-west and north-east.
Monday 8 April
Benefit uprating begins
For the first time in history welfare benefits and tax credits will not rise in line with inflation and will instead for the next three years rise by 1%. Had there been no change benefits would have risen by 2.2%. Disability benefits will continue to rise in line with inflation.
Savings: £505m in the first year, rising to £2.3bn in 2015-16. Nearly 9.5 million families will be affected, including 7 million in work, by £165 a year.
Monday 15 April
Welfare benefit cap
The most popular of the welfare reforms will begin on 15 April in the London boroughs of Bromley, Croydon, Enfield and Haringey. The intention is that no welfare claimants will receive in total more than the average annual household income after tax and national insurance – estimated at £26,000. Other councils will start to introduce it from 15 July and it will be fully up and running by the end of September. Some estimate 80,000 households will be made homeless. The DWP says around 7,000 people who would have been affected by the cap have moved into work and a further 22,000 have accepted employment support to move into work. Households where someone is entitled to working tax credits will not be affected.
Savings: £51m over three years.
Universal credit introduced
The new in- and out-of-work credit, which integrates six of the main out-of-work benefits, will start to be implemented this April in one jobcentre in Ashton-under-Lyne, Greater Manchester. The aim is to increase incentives to work for the unemployed and to encourage longer hours for those working part-time. It had been intended that four jobcentres would start the trial in April, but this has been delayed until July, and a national programme will start in September for new claimants. They will test the new sanctions regime and a new fortnightly job search trial, which aims to ensure all jobseeker’s allowance and unemployment claimants are automatically signed onto Job Match, an internet-based job-search mechanism. Suspicion remains that the software is not ready.
You repeat the myth that companies “return money to shareholders”. Your report on David Einhorn’s abandonment of his lawsuit against Apple (2 March) is the latest repetition of this fable. One cannot return what was not given. For over 80 years – from Berle & Means’ landmark 1932 book to the recent report by John Kay – reports have unequivocally shown that shareholders provide a trivial amount of corporate finance and in many years are a negative source. Overwhelmingly, shareholders are not investors in companies, but speculators in their shares. I am not condemning that – I trade myself – but I’m not deluded into thinking that I’m investing in business. Describing shareholders as investors is not merely quaint, it is misleading. To paraphrase Adolph Berle: when, for example, I bought shares in Apple from Bardolph, who bought them from Pistol, who bought them at 10,000 removes from Sir John Falstaff – who did in fact invest some money in an original issue of common equity of Apple – my money did not go to Apple, nor did that of the 10,000 or so other previous owners of those shares. A shareholder’s relationship with a company is, in effect, the same as that of a punter on horse races with the owners of the horses.
Professor Brendan McSweeney
Royal Holloway, University of London
• Polls show general satisfaction with the NHS, state education, the BBC, the probation service and so on. Yet this government seems determined to undermine them. But when it comes to banks and financial services, which earn widespread dissatisfaction, they are treated like holy cows.
Coroner says doctor made ‘wholly inadequate entries on the records that were clearly at odds with the evidence’
The performance of a doctor treating a seven-week-old baby boy who died while in the care of the privatised out-of-hours GP service in north London was “wholly inadequate”, a coroner said on Thursday.
Dr Muttu Shantikumar assessed the newborn baby, Axel Peanberg King, in a telephone call lasting just one minute a few hours before he collapsed in his mother’s arms, and later made “wholly inadequate entries on the records that were clearly at odds with the evidence”, according to Dr Shirley Radcliffe, the St Pancras coroner.
Axel, previously fit and well, died last November, having contracted a routine cold which developed into a lung infection that went untreated, despite repeated calls and visits by his parents, Linda Peanberg King and Alistair King, over the course of five days to the service and their own GP. Out-of-hours GP cover is run under contract to the NHS in the north central London region by private provider Harmoni.
On the day the baby died, Shantikumar failed to ask the family the essential questions to determine how serious the case was. He downgraded Axel’s priority, which had been classified as urgent by a Harmoni call handler, to routine, following his very brief telephone assessment so that the baby was only given an appointment to see a doctor face-to-face three and a half hours later.
When Peanberg King attended the Harmoni clinic, which is located alongside the NHS A&E department in north London’s Whittington hospital, she was made to wait with her baby in a queue with six patients ahead of her.
An off-duty NHS paediatric nurse who happened to be sitting near them in the queue realised the gravity of his case and immediately rushed them into the NHS A&E department next door, where frantic efforts were made to resuscitate him in vain. He was declared dead when his father, who had been at home looking after the couple’s older child, arrived at the hospital.
The Guardian revealed last December that staff at the Harmoni service feared delays in treating the baby may have contributed to the tragedy. It is very rare, although not unprecedented, for babies in the UK to die of pneumonia.
Recording a narrative verdict which did not apportion blame to individuals, the coroner said it was not possible to say whether intervention at an earlier stage that day would have changed the outcome. Babies that age can deteriorate very rapidly and sadly a few do die, the court heard.
The coroner also found that the consultations and assessments made by staff for the out-of-hours service over the previous few days were appropriate. Two days before he died, the baby had been seen by Dr Kuljeet Takhar, supplied to Harmoni by an agency. The parents had previously reported that Axel was having difficulty breathing, but when Takhar carried out a full examination, he found the baby’s lungs were clear and the coroner accepted that at that point the diagnosis of an upper respiratory tract infection was appropriate. Takhar gave a deferred prescription for antibiotics. It was not best practice to do so in babies so young, the coroner said, but Radcliffe also noted that Takhar had told Peanberg King not to be too reassured because very young babies can change very rapidly.
The family said they were not satisfied that they had got to the truth. “We believe there are still many questions to answer about the safety of the service provided by Harmoni. We do not believe that anyone hearing all the evidence in this case could have full confidence in its services. We are now considering all our options to prevent any other children from falling through the net.”
Ellen Parry, from the clinical negligence team at law firm Leigh Day, who is representing Axel’s parents, said:
“Both Linda and Alistair want to know how their otherwise healthy baby, after repeated visits and calls to this privately run clinic, died from a treatable illness, a death that we believe was entirely preventable.”Dr David Lee, medical director for Harmoni, said: “We would like to express our deepest and heartfelt sympathy to the Peanberg King family.
“We believe we have the right underlying systems, policies and procedures to ensure a safe and robust-out-of hours service. We will now be taking full regard of the coroner’s findings.
“We know that the review of very difficult incidents such as this always identifies learning points. Our overriding priority is to ensure that this learning is acted on.”
The court heard that over the period that the family were in contact with the service there were three gaps in the rota for staff to assess and see patients but Lee said that staffing levels had been safe at all times since slack was built in to allow for people being off ill or for shifts to be unfilled.
Regulators take step closer to placing clinically and financially troubled trust on list of NHS ‘unsustainable providers’
The hospital trust at the centre of the NHS’s biggest care scandal in years looks likely to be broken up after a health service watchdog warned that patient safety could be put at risk because of its huge financial problems.
Mid Staffordshire NHS Foundation Trust faces the prospect of other nearby hospitals taking over some of its key services as a result of an inquiry into its clinical and financial viability by experts commissioned by the regulator, Monitor.
Between 400 and 1,200 patients are believed to have died between 2005 and 2008 after receiving poor care at Stafford hospital, which the trust runs.
The results of a public inquiry, headed by Robert Francis QC, into how failings in the NHS regulatory system failed to identify and prevent the scandal are due within weeks.
While Mid Staffs trust is providing safe care at the moment, it will not be able to do so on a sustainable basis in future, according to a contingency planning team, made up of experts from Ernst & Young and McKinsey & Company, and appointed by Monitor. The trust faces many challenges, including low patient numbers, large debts and persistent difficulty in recruiting doctors and nurses, the team’s report warns.
The team says that, as one of the smallest hospital trusts in England, with relatively few patients using A&E, giving birth or receiving planned surgery at the two hospitals it runs – the other is in Cannock – Mid Staffs “will find it increasingly difficult to provide adequate professional experience for consultants and support them in the numbers recommended to maintain a high-quality service in the long term”.
Mid Staffs received £20m from the Department of Health (DH) last year to help stay afloat. It would have to make £53m of savings in the next five years in order to break even. And, even if it did so, it would still need a further £73m from the DH, the experts said.
They are now looking at whether the trust can continue to operate both hospitals, and “assessing whether some services should be moved to existing or new providers in the area”.
Monitor will submit a final report containing recommendations in March, which could lead it to make Mid Staffs the second trust, after the debt-plagued South London Healthcare Trust, to be put into the NHS’s “unsustainable providers” regime.
Lyn Hill-Tout, the Mid Staffs chief executive, said its board accepted that the trust was not clinically or financially sustainable because, despite many improvements, it was unable to break even by 2015. Its financial situation mirrored that of many smaller district general hospitals across England, she added.
A DH spokeswoman said: “Despite improvements, Mid Staffordshire is still facing serious financial challenges. This puts at risk its work on improving services for patients. It is important that valued local services will last and are able to continue providing high-quality treatment and advice for patients.”
Health committee criticises lack of progress two years after consultation document on subject was published
Government proposals to change the system for approval of drugs that can be used in the NHS are still in a “nebulous” state and taking an unacceptably long time to be worked out, say MPs.
The government has floated ideas for what it calls “value-based pricing” of drugs, which would remove the final say on whether or not a drug could be used in the NHS away from the National Institute for Health and Clinical Excellence (Nice). The institute has been regularly attacked for turning down new medicines on the grounds that they do too little for too much money.
This “cost-effectiveness” criteria would be replaced by a negotiation between the manufacturer and health officials – once Nice has appraised the drug and agreed that it has benefit to patients. The idea is that a price would be agreed on the basis of the “value” the drug represents to the NHS, taking into account issues such as the need of patients for the medicine and whether it is innovative or similar to another drug.
But in spite of a consultation document two years ago and publication of the response to it last July, “it remains a source of concern that so little progress has been made on defining this nebulous concept”, says the report by the Commons health select committee.
“We do not regard it as acceptable that the arrangements for value-based pricing have still not been settled and that those who will have to work with those arrangements are still unclear about what value-based pricing will mean in practice.”
Drug companies, doctors and patients all need to know how the new system will work, the MPs say, demanding that government publish details by the end of March.
The committee also wants to see the detailed publication of all drug trials – whether the results are positive or negative. All the information needs to be available so that other researchers can learn for the future.
“We do not believe it should be either legal or considered ethical to withhold research data about pharmaceutical products. We are therefore concerned that this simple principle is not universally applied in practice,” says the report.
It adds that MPs were also concerned by the implication of the evidence of Nice’s chief executive, Sir Andrew Dillon, who told them that Nice was having to make appraisals of drugs without having access to all relevant data.
The committee called on the pharmaceutical industry to introduce new guidance making it obligatory for companies to publish all the data they have on drugs that have been through the licensing process and are in use.
So, the research from Virginia Commonwealth University confirms what we’ve long known: that despite spending enormous sums on their healthcare, Americans are sicker and die younger than people in other rich nations (Report, 11 January). Even more shocking is the level of ignorance within the US about just how appalling their health is compared with other nations. We could look on with pity if our own government were not introducing “reforms” that are driving us into an US-style healthcare system; this despite all the evidence that it is inefficient and bad for our health, and by a government that has no electoral mandate. If we are to have a referendum on Europe, let’s have one on the NHS “reforms”.
The US research is especially interesting because it reveals that even America’s privileged white middle class fares badly. Everybody benefits from a healthcare system into which we all pool our resources – and everyone suffers when our health is left to the mercy of profiteers. In Britain we have built a complex and successful welfare state founded on socialised healthcare, universal benefits and a comprehensive system of social security. How alarming that we are allowing it to be sold off to the locust capitalists. I don’t know how we are going to explain it to our grandchildren.
Emeritus professor Mark Doel
• I am very concerned at the government’s proposed cuts, which clearly seek to turn our NHS over to private businesses. In south-west England we can see the start of that process as 20 NHS trusts have signed up to a cartel with the express purpose of cutting the terms and conditions of health workers. This is at a time when NHS trusts are being forced to make massive cuts that will affect patients. An open meeting to discuss the NHS changes is being held tomorrow at Bristol University and there is a demonstration in Exeter on 23 March to keep the NHS free and in the public sector.
Unite the Union, Bristol
• The government has fairly successfully convinced the public that a large proportion of benefit recipients are claiming illegally. The Guardian, among other commentators that have looked more carefully at the facts, seeks to dispel this myth. However, the government is now doing its best – through its support of organisations such as Cure the NHS – to put about another myth: that NHS institutions are, at best, riddled with inefficiency and, at worst, totally uncaring.
I have been a patient more than once at the much reviled Stafford hospital. The treatment I received was pretty good, though perhaps not always perfect. Any organisation – particularly a large one – will get things wrong from time to time and, obviously, every effort must be made to keep this to a minimum. Stafford, it would appear, got things wrong more often than most hospitals; but most of the time, I think, they got it right and we should not lose sight of that fact. I would not discourage anyone from having treatment there.
I hope that those who are seeking to nail the benefits myth will have enough energy to dispel the NHS myth as well. Maybe everyone who has had a good experience of the NHS should write to both the provider of that service and to the media to tell them about it.