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NHS Logistics

: Yes, I am. NHS Logistics has won a string of awards. For example, last year it won an IT technology award for which it was praised by Sir Nigel Crisp. I am particularly interested in the IT awards, because we are told that the need for investment in a new computer system is a major reason for bringing the private sector into the NHS supply chain—in the role that is currently fulfilled by NHS Logistics. We hear that such investment can be funded only by the private sector, yet NHS Logistics has won many IT awards as well as awards for its other functions. That is just one of the things that puzzle those of us who have NHS Logistics sites in our constituencies. We are also puzzled by some of the arguments that have been made for moving the service into the private sector. There is much on which I agree with my right hon. Friend the Minister. It is sensible to review the plethora of arm's length bodies to ensure that they provide value and effective services and work as efficiently as possible. It is also reasonable to keep the NHS supply chain under continuous review to ensure that it runs efficiently and to seek improvements—the evidence from our visits suggests that the supply chain is run efficiently. While safeguarding the security of the supply chain, we should also ensure that maximum resources are available for front-line patient care. While we would not dispute that we have some common ground with the Minister, I and other hon. Members have sought this debate because there is under way a process of market testing to decide whether the private sector should become involved, or whether NHS Logistics should stay as it is, perhaps with adaptations. We want to ensure that that process is carried out properly. We are concerned that it is not taking into account all the necessary factors, and I would like assurances from my right hon. Friend the Minister that nobody involved in the process—whether a civil servant, a member of the Department of Health commercial directorate or a Minister—starts by automatically assuming that the private sector is the best or the only option. I should also like to be told clearly the aim of the process. In what direction are we going? Because I am accountable to my constituents, I need access to full information about how any decision is taken. I want to make sure that the process is transparent, and I seek ministerial assurances on all the issues. That is why my colleagues and I have sought this debate and tabled a number of parliamentary questions. We started off thinking that the issue was NHS Logistics' efficiency, but when we visited its sites, we were impressed by its efficiency. As has been mentioned, it has won a number of awards and it clearly is efficient in a number of ways. Following a number of efficiency exercises, many jobs were lost at the Alfreton site last year—I know that because one of my good friends lost her job in that review. One of the six NHS Logistics sites—the one in Bridgwater—is already privately run, and that is the site with the lowest satisfaction rate among customers. In addition, the organisation already works with private sector partners—the transport that I saw was provided by TNT. I note that NHS Logistics' on-time delivery performance is running at well over 90 per cent. It runs a benchmarking system to test its performance against that of the private sector through Logmark, the UK logistics benchmarking club, and utilises a number of other means. There is not necessarily any doubt about the organisation's efficiency. I think that it is generally accepted that it is efficient, and I ask the Minister to confirm that. We were then told that the argument had moved on and the question now was whether the organisation could be more effective if a greater proportion of the market were provided for centrally, thus achieving economies of scale and enabling more money to be put into patient care. I am rather dubious about some of the arguments that have been put in that respect and I should like the Minister to ensure that all the arguments are taken into account. When colleagues and I met the Health Minister Lord Warner before the election, he stated that NHS Logistics formed only a small proportion of the supply chain. However, although it has only 20 per cent. of the market share by value, it provides 70 per cent. of the market by volume. It is important not to disrupt the supply chain to health providers. I am told that there are 9,000 suppliers in the sector, of which NHS Logistics is by far the largest. I have also seen the current business plan, which I believe the commercial directorate has approved. NHS Logistics is already expanding into some of the more specialist areas with which it has not previously dealt. It has plans for a 41 per cent. growth target over the next four years, taking it to a market share of 30 per cent. by value, following growth of 35 per cent. in the past four years. Although there may have been a rocky start after the Cabinet Office report, NHS Logistics has gone zooming ahead over the past few years.