IF you want to see how politically connected privatisation firms make money out of the NHS, you can look over the latest accounts for Medacs Healthcare PLC, released at the end of July. They show how the NHS privatisers do well out of the NHS doing badly.

Its annual report tells us: “The group has identified Lord Ashcroft as the ultimate controlling party” of Medacs. Ashcroft “has influence” over half the shares of Medacs’ parent company Impellam, which he chairs.  

Ashcroft is one of the Tories’ main donors, giving the party millions over the years.

He has helped shape Tory policy for decades, serving as party treasurer and deputy chairman.

Ashcroft fell out with the party when David Cameron refused to make him a minister, but is back on board, donating another £50,000 this February. Ashcroft has long encouraged privatisation, which in turn enriches his company.

Ashcroft’s firm had a very good pandemic, thanks to a juicy government contract and the government running down the NHS.

Medacs supplies short-term health staff, including locum doctors and temporary nurses. Its 2021 turnover was £161 million — a huge 74 per cent increase on 2020 and 80 per cent higher on the pre-Covid year of 2019. The pandemic has really boosted its business. Profits grew by 106 per cent to £1.9m.

There were two reasons for this huge growth in business.

Firstly, it got a very fat Covid contract. As the annual report says, Medacs “achieved revenue growth in 2021 from our exclusive managed service contract awarded by the Department of Health and Social Care in December 2020 to support the national Covid-19 testing service.”

This is a two-year contract worth £350m to supply scientists and other staff to a government testing lab.

Instead of strengthening the NHS by staffing its own lab, the government let this huge sum flow out of the Department of Health and into Medacs’ balance sheet.

There was minimal competition for the huge award to Ashcroft’s firm: Medacs got the job because it was already on a “framework” of favoured government suppliers.

Medacs also picked up other Covid work. As it says, other contracts included the firm working for “the NHS via the vaccination programme for Buckinghamshire, Oxfordshire and Berkshire Health Authorities.”

It also did well out of the failures of the NHS: “We are already the biggest supplier for locum doctors to the NHS and with demand for healthcare professionals outstripping supply in the UK our international placements division recruited over 1,100 nurses in 2021.”  

The government has ensured that NHS demand outstrips supply — that there aren’t enough nurses or doctors — by not paying to train them. Medacs then jumps in to increase its profits by supplying medical staff.

The Medacs annual report is pretty open about how it profits from NHS failure. It says: “Growth was driven from new significant Staff Bank and MSP wins across several Hospital Trusts.” MSP means “managed service provider,” where Medacs provides a broader staffing service than just running the staff bank.

While making money from NHS staff shortages, Medacs complains about how some hospitals solve their own staffing problems.

Medacs says it lost some business because of “a continued focus on the reduction of agency spending across the NHS as a growing number of trusts look to internal Staff Banks to fill their temporary staffing.” In terms of its annual report, this is presented as a bad thing.

Ashcroft can be pleased that his Tories have run down the NHS, because the resulting staff problems are boosting his firm’s income. He doesn’t even need to worry too much about a change of government, as this month Keir Starmer dropped a policy pledge to end private-sector outsourcing in the NHS.

Tainting Yorkshire’s water

This month Yorkshire Water was fined £1.6m for repeatedly allowing filth to spill into Bradford Beck, the river that runs through the Yorkshire city and out into the countryside. The fine shows both how bad the private water firms are and why they don’t care about spilling human waste into rivers.

The firm has a huge overflow tank underneath Bradford that fills with sewage and storm water. It is supposed to hold this in the tank during downpours, then pump it back into the sewers when the storms pass.

But throughout 2018 the pumps didn’t work, so the filthy water was allowed to repeatedly overflow into the river. That the firm refused to do its job and simply allowed its pumps to fail is reflected in the size of the fine.

But will the company really care? Thanks to its government-licensed monopoly, it has over £1 billion in income. Fines that sound big to us mean little to it.

Thanks to privatisation, its owners are not much to do with Yorkshire anyway.

Its main owners include Germany’s Deutsche Asset Management (23 per cent) and the government of Singapore’s investment arm (33 per cent). No offence to the financiers of Germany and Singapore, but I doubt they give a toss about effluent in Bradford.

Then there is Corsair Capital which owns 30 per cent. It is essentially a US firm. It does have one senior British figure on board, former Labour minister Lord Mervyn Davies, a banker brought in by Gordon Brown to help make the government more friendly to bankers.

He will no doubt be pleased by Starmer’s recent decision to abandon water nationalisation.

Water prosecutions take ages. This month’s fine covers a pollution in 2018. Richard Flint was the chief executive of Yorkshire Water from 2010-19.

In 2020 he was given a CBE “for services to the water industry and to the environment.” Even before this fine, the company was known for poor safety and environmental management.

In 2018 the firm paid a £733k fine following the “wholly avoidable” death of one of its workers in a nasty industrial accident. In 2019 it was fined £200k for polluting the appropriately named “pissy beds” drain, which flows into the River Trent.

In 2016 it was fined £1.1m for illegally pumping sewage into the River Ouse. If we want to stop water firms pumping filth into rivers, we should be prosecuting the heads of water firms, not giving them medals from the Queen.