Unite hails victory on government ‘U-turn’ on 14 per
cent ‘NHS privatisation tax’
3 March 2011
The government is withdrawing its controversial plans for a 14
per cent ‘NHS privatisation tax’ which would have helped private
healthcare companies take over great swathes of the health
service.
Unite, the largest union in the country, said today (Thursday 3
March) that this was a victory against the privatisation of the
NHS. The union first exposed this ‘tax’ threat a fortnight ago.
The government has now tabled amendments to the Health and
Social Care bill, currently going through parliament, which, in
effect, stops private companies getting a financial leg-up when
competing for lucrative NHS contracts.
The amendments won’t be debated for about a fortnight, but as
they are government amendments they will certainly be
passed.
Unite assistant general secretary, Jennie Bremner, said: ”This
is a victory when coupled with health secretary Andrew Lansley’s
intention to now rule out competition on price.
”But there is a lot further to go to save the NHS and this
U-turn calls into question how this proposal was ever made. The
government’s handling of this legislation has descended from muddle
into shambles.”
Unite, which has 100,000 members working in the health service,
had said that the 14 per cent ‘tax’ would have meant taxpayers
subsidising the corporation tax that the private healthcare
companies would incur on the profits they would make on their NHS
contracts. Other elements would have included ‘help’ with pension
provision and building costs.
Unite research had discovered that the Impact Assessment – which
accompanies the bill - indicated that private providers would
have been given a 14 per cent ‘leg up’ - for every £100 they
spent in the new NHS ‘market’, the taxpayer would have been made to
refund them £14. This could have cost the taxpayer millions of
pounds in subsidies for private firms.
Jennie Bremner said: ”Unite now needs to press for a firm
guarantee that this doesn't leave any scope for individual private
providers to claim that their specific cost base is higher than NHS
providers.”
Unite had said that the reason that the bill had originally been
structured in this way was that the NHS does not pay corporation
tax on its activities; that private companies wanted public funding
for providing pension provision for the staff they employ; and
these firms complained that the NHS already has buildings in place
that they would have to provide.
ENDS
Notes for editors
For information please contact Unite communications officer
Shaun Noble on 07768 693940
