David Cameron's adviser says health reform is a chance to make big profits

Health secretary Andrew Lansley is likely to be placed under further pressure by the comments of Mark Britnell to private equity investors. Photograph: David Jones/PA

A senior adviser to David Cameron says the NHS could be improved by charging patients and will be transformed into a "state insurance provider, not a state deliverer" of care.
Mark Britnell, who was appointed to a "kitchen cabinet" advising the prime minister on reforming the NHS, told a conference of executives from the private sector that future reforms would show "no mercy" to the NHS and offer a "big opportunity" to the for-profit sector.
The revelations come on the eve of an important speech by the prime minister on the future of the NHS, during which he is expected to try to allay widespread fears that the reforms proposed in health secretary Andrew Lansley's health and social care bill would lead to privatisation.
It has been suggested that Cameron may even announce an extension to the "pause" in the progress of the bill until after the party conference season, amid growing tensions on the issue within the coalition government.
Nick Clegg, has insisted that the Liberal Democrats will not support any reforms that allow the "profit motive to drive a coach and horses through the NHS". Backbench Tory MPs, however, have called for the government to stick to the reforms and open the provision of services to the private sector. Britnell's comments will inevitably raise the temperature of the debate.
Britnell, a former director of commissioning for the NHS, who is now head of health at the accountancy giant KPMG, was invited to join a group of senior health policy experts, described by the respected Health Studies Journal as a "kitchen cabinet", in Downing Street earlier this month. The group, which includes former NHS executives and the former Department of Health permanent secretary Lord Crisp, was assembled by Cameron's new special adviser on health, Paul Bate.
In unguarded comments at a conference in New York organised by the private equity company Apax, Britnell claimed that the next two years in the UK would provide a "big opportunity" for the for-profit sector, and that the NHS would ultimately end up as a financier of care similar to an insurance company rather than a provider of hospitals and staff.
According to a glossy brochure summarising the conference held last October, Britnell told his audience: "GPs will have to aggregate purchasing power and there will be a big opportunity for those companies that can facilitate this process … In future, the NHS will be a state insurance provider, not a state deliverer." He added: "The NHS will be shown no mercy and the best time to take advantage of this will be in the next couple of years." Writing in the Health Studies Journal, Britnell also suggested that the NHS would be better served by breaking with the mantra that all services should be free at the point of delivery by allowing co-payment, where patients share the costs of care and drugs.
"It appears that countries that have a mixed blend of public and private provision, co-payment and social insurance are possibly more capable of providing resilient healthcare systems."
The shadow health secretary, John Healey, said: "This revelation comes direct from Cameron's inner circle and gives the game away on the government's NHS plans. It confirms the Tories' true purpose is to set up a free-market NHS and open up all parts of the health service to private companies."
In a move that will pile more pressure on Lansley, the Department of Health last week released the latest Mori poll on satisfaction levels with the NHS. It shows that 66% of people questioned believed the NHS was the best health service in the world, while 37% of the public expected services to deteriorate following the reforms. However, nearly three-quarters said that they knew "not very much" or "nothing at all" about changes that the government plans to make.
Sir Michael Scholar, chairman of the UK Statistics Authority, demanded a rethink of the halt on funding for the General Lifestyle Survey, which is run by the Office for National Statistics. Scholar said: "If government is planning a major reform of the NHS, people will want to know if it is worse afterwards or not. These statistics are very important in reaching a rational view."
Labour sources said that the only explanation for the cuts in funding was that the government expected a hostile reaction to the reforms that do proceed and ministers were "planning how best to keep that from view".
Downing Street tried to distance itself from Britnell. A No 10 spokesman said: "We will never privatise the NHS. We remain committed to the principle of an NHS funded from general taxation and based on need not ability to pay. Mark Britnell is not the prime minister's health adviser. We are listening to the views of experts, patients and staff on how to improve our plans to strengthen the NHS."
Daniel Boffey and Toby Helm @'The Guardian'
(GB2011)