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Smoke signals

Unions are hoping that a leadership change will alter Blair's modernisation agenda

Mr Blair has finally said his last goodbye to the TUC. It was an event that both parties seemed glad to have out of the way. In the weeks before the brothers and sisters gathered in Brighton the Labour Party in Parliament was riven with venom and turmoil, as the enemies of Blair attempted to force him out.

The Blair response to these torrid events was amazing. At first he looked tired and drawn, but at a pre-TUC speech at a Blair-friendly think tank he gave a performance of supreme confidence. His message to his party was simple - modernise or die - reminding them that divided political parties turn voters off.

Before the TUC conference, the media had begun to turn on Gordon Brown, seeing his pawmarks all over the failed attempts to get Blair out; all of which were vehemently denied by Brown.

Blair got to the TUC in defiant mode. In a confident speech, he reminded the unions of the need for greater change in a world where globalisation is getting faster and where the economies of China and India are booming.

If the unions expected a cowering Blair, they were mistaken. As he delivered his views, we saw extraordinary scenes. A Labour Prime Minister was heckled loudly, placards demanding his departure were held up across the hall and some fraternal comrades chose to walk out.

Blair did not seem rattled at all and held his nerve, but his TUC swansong was not to be crowned with acclamation or ovation. After fielding some predictable, aggressive questions, he breezily bade farewell and left the stage.

Bitter sweet taste
The same afternoon, Brown made his way into Brighton for a very private dinner with trades union barons, smiling broadly to the assembled media.

He claims that the modernisation agenda in public services will continue if he lands the top job, but the unions seem hopeful that his view of modernisation might prove more palatable than Blair's. Are they right?

The Labour Party elects its leader in a complex fashion, with three factions all having a say: the parliamentary party, including all elected parliamentarians, form one-third of the electoral college; local party members around the country get a vote, forming the second section of the college, and the third tranche of votes is in the hands of trades unions affiliated to the Labour Party. You could argue that electing a Labour leader is as complex as the election of the Pope.

If Brown is to succeed Blair, then he must court all of the votes in all parts of the electoral college. The party in Parliament is torn, with many Blairites now publicly questioning the ability of Brown to succeed Blair. The party in the country is difficult to read, but commentators suggest that many local parties are primarily for the Blair policy changes, if not for Blair. The unions loathe the Blair policy agenda and seem keen on Brown as successor, but what do we know about Brown?

Heart of the issue
The NHS has been at the heart of Blair modernisation. Foundation Trusts, greater involvement of the private sector in delivery and payment by results provide stark examples of marketisation, if not privatisation, of the NHS. Brown opposed Foundation Trusts as Chancellor.

He saw the idea of local freedoms outside Treasury control as a step too far and watered down the original ideas from Alan Milburn who, as the then Health Secretary, was the midwife to Foundation Trusts.

Brown and his supporters are canny. If they declare too much of their hand on the NHS and roll back the Blair agenda, they would face fierce attack and charges of disloyalty. I suspect that Brown and his allies know that reform of the NHS is inevitable.

In an interview in the Guardian, David Nicholson, the new CEO of the NHS, spelt out clearly that acute hospital provision in England will need rapid reconfiguration to remain viable before the next election. The public will not like this, but it needs to happen for sound clinical reasons, as well as financial. Brown, if he becomes Prime Minister, will need to oversee radical and politically difficult change.

If he were to accept this, but take the heat off the NHS workforce and unions by slowing the marketisation of the NHS, could he buy support? I suspect he could. At the moment Primary Care Trusts (PCTs) in England are about to relinquish any provider functions, leaving whole swathes of services in the community up for grabs by the private sector. Brown could simply reverse this and allow PCTs to continue to provide as part of the NHS.The unions would bite his arm off for this, and be a lot happier.

He could also call a halt to the roll out of Foundation Trusts. David Nicholson has already admitted that the current financial state of the NHS will mean that most acute hospitals will not be ready for Foundation status by 2008, as planned.

In mental health, where budgets have been shot to ribbons, far fewer will become Foundation Trusts. It is not difficult to imagine a scenario where Brown could call time on them, but keep in place a finance regime that keeps pressure on improvements.

Such changes would allow him to claim that the modernising continues through a prudent financial framework, but would do much to please the unions, the NHS workforce and many Labour parliamentarians who see the NHS as the defining jewel in the old Labour crown. In short, it could buy Brown a lot of votes when the election of Blair's successor comes.

I predicted last year in PM that the position of Blair on reforms in education and the NHS could prove to be his undoing. These coupled with a few tricky issues, such as Iraq and Lebanon, have sealed his fate and many predict that he may not survive until next May, as currently planned.

Turbulent times
The NHS is going to be totally unpredictable between now and the departure of Blair. There is enough chaos in the NHS in England this year, with the changes in Health Authorities and PCTs underway, and some tough financial challenges. If anyone hopes for a period of predictability and stability in the near future I suggest that they don't hold their breath.

If Brown does follow Blair, and the smart money suggests he will, plenty in the NHS will be up for grabs, much of it as a consequence of raw politics, which might provide the right policies.

Critics of the current reform agenda bemoan the pace of change and what is being demanded. In primary care, many front line clinical staff are despondent and believe the government is making up policy on the hoof.

Taking some of the pressure off the NHS workforce and keeping the unions onside could buy Brown time to reframe the modernisation debate in the NHS, recognising that changing the shape of services over the medium and longer term is vital.

It might brass off private sector providers who see the potential for market growth, but few of them are actually going to have a vote in electing Blair's successor.

The author
Ray Rowden is a health policy analyst and a member of the Labour Party

2nd September 2008

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