Sometimes, people smile superciliously at me for taking the Liberal Democrats’ health policy seriously. That’s okay, of course. A lot of people got used to the vacuousness that persisted under Charles Kennedy’s leadership of the party. Others simply can’t imagine the political arithmetic that could give the Lib Dems the balance of power at Westminster.

I completely understand where the first lot are coming from, although their failure to engage with the more intelligent policies developed by Norman Lamb and colleagues seems silly to me. The latter group’s enviable certainty that the next election is going to run similarly to any election for some decades is, I think, misplaced. 2010 has the potential to be seismic.

So what has changed since last year? Lamb’s speech was a bit shorter. In the wake of his leader Nick Clegg’s headline-seeking use of the word “savage” about proposed cuts (at least permitting political correspondents to move on from fussing about the noun cuts to the adjective ‘savage’), he confirmed the Lib Dem intent of cutting spending. It was no surprise to anyone who’s followed this site’s coverage (see links above), but it cuts against the popular perception.

The speech also had effective attacks on the Conservatives, and more tellingly in terms of positioning, on Labour “the road to hell is paved with a bungled private finance initiative. Labour invested an enormous amount of our money to make up for the years of Tory neglect. But too much has been squandered.”

But oh dear – we’re back to counting furniture: “Did you know there are now more administrators, managers and clerks in the NHS than there are hospital beds to put them in?” Proving precisely nothing. It’s admittedly a crowd-pleasing line, but it is literally and metaphorically claptrap.

NHS Confed policy director Nigel Edwards has repeatedly pointed out that the number of beds tells us as much useful information about healthcare services as the number of windows. The proximity of a general election militates against sensible debate at the best of times. But this is not a useful advance in the political or public conversation.

Bonfire of the bureaucrats – you’ll know when you’ve been quango’ed
Again, readers of HPI will not have been surprised by Lamb’s statement that “Labour’s leviathan has grown so large that health Quangos alone now cost nearly £1.2 billion a year, employing 25,000 people and with 24 quango chiefs each being paid more than the Prime Minister - the time has come to sort this out.

“We will wield an axe to the quango state. In a decentralised NHS there are 5 steps to be taken.

“We will not allow more than one organisation to ask the same question to a hospital or any other health trust.

“We will cut the amount spent on quangos by a fifth - scrapping many of them completely.

“We will cap high-earners pay in health Quangos so that no one is paid more than the Prime Minister.

“We will cut the bureaucracy of the Department of Health by half.

“We will scrap Strategic Health Authorities which have no place in a decentralised NHS.

“This would result in huge savings, over £1/2 billion a year, not only in central costs but in every hospital”.

It’s good to have a clear list, to review the pros and cons. Point one of the five gets an uncritical tick. There is significant duplication across regulators. It is clearly possible to enforce collaboration on a system where the data is provided once – logically, to the NHS information Centre, who the forward it on to the relevant body.

Unfortunately, the second point smacks of dogma. Scraping quangos is one of the great political promises. Simon Jenkins has pointed out repeatedly that quangos are often set up by governments who do not want to do contentious or unpopular things. They rarely have no function at all: it is unfortunate that no example was given.

Point number three is inevitable, but really, the wrong point. One of the downsides of the market fetishisation that charactersed New Labour’s administrations has been the concept that civil servants should get private sector-comparable packages of salaries and bonuses.

It’s economically illiterate, given in particular the generosity and safety of the civil service pension scheme. But the worst bit of iy is the bonus culture being introduced into the public sector.

I can accept that people in many private sector businesses should be able to be incentivised by bonuses. It is an up-side to the clear down-side of effectively having zero job security. There are, of course, areas such as banking where a bonus culture creates wildly perverse incentives to take risks. It’s ewhy regulatio0n is needed.

But public sector jobs are very secure, and effective trades unions exist (oh yes, even for senior quangocrats – hello, the FDA / Managers In Partnership). Since the salary inflation of the past generation, bonus culture fits poorly into senior levels of the public sector and similar organisations like the BBC.

Points four and five run the risk of clashing. I’m no more of a fan of the DH than many … oh, OK, much less than most. But if you’re going to do without SHAs (who, like it or n jot, do have a range of functions), somebody is going to have to do that work. This is incoherent as stated.

Devolving budgets
Much more sense was made in the ideas around devolving and decentralising: “The Liberal Democrats will give power back to the nurses who run our wards. This means giving the ward sister control over their budgets and responsibility for the staff who work there.

“So that when they’re understaffed, they’re able to call in extra help. So that the ward sister can take whatever steps are necessary to ensure that patients are properly fed and end the utter disgrace of patients leaving hospital malnourished.

“And so that when the cleanliness of wards isn’t up to scratch, they’re responsible for sorting it out and they have the power to act - the ward sister must have the final say”. I think it’s very much the right idea. It’s reminiscent of Lord Darzi’s smart suggestion in his last days in post that budgets should be devolved down to clinical teams. (As if to prove that there is nothing new under the sun, Kings Fund chief economist John Appleby tells me that this idea was first proposed in the 1950s.)

The idea of linking responsibility to the front-line staff is a good one on paper. There are some challenges: what do you do if front-line staff don’t want he responsibility? Who acts if they overspend? How will they be trained to manage a budget? What happens if ward closures are ordered on debatable or political grounds?

These are caveats, rather than reasons not to try something new. Smart minds could be brought to bear on the ideas.

The mutual NHS
Lamb has also gone further in his ideas about developing a mutual NHS. “We should look at what works in other sectors and learn from their success – the John Lewis Partnership model is just such a case. In this highly successful business every staff member is a partner, has a say in important decisions and benefits from the success.

“The Liberal Democrats would turn every NHS hospital into an employee owned trust - so that people working in the NHS have a stake in it as well. This makes a reality of Jo Grimond’s great vision of employee involvement. All the evidence shows that this approach will improve quality and save money”.

Again: asset locks / sales; FT status; PFI deals; capital funding; how to close an out-of-date or out of demographic / commissioner trust? There are many technical challenges. I think we need to book in for an interview.

Funding changes
The Lib Dems’ unique candour about not protecting the NHS budget made their thoughts on funding even more keenly anticipated. Lamb told delegates, “Rather than simply giving hospitals money for doing more and more operations we should reward those that help keep people healthy, bridging the divide between primary and secondary care.

“By reforming the payment system we can help hospitals to be more efficient. Hospitals would receive payments for operations at a rate based on the best-run hospitals rather than the average”.

The latter point is, of course, already government policy. But that’s fine. Continuity is needed on some things.

“Instead of spending £150m on the health and pregnancy grant giveaway we’ll recruit 3000 more mid-wives and health visitors.” Ooo-kay, but that’s not many. 300 per SHA (yes, I know you’re abolishing them), but 300 more for London is going to be a drop in the ocean.

Overall, the Lib Dems have got the plot on spending cuts. The idea of a mutually-owned NHS could have traction, but requires considerable thought. Likewise the thought about an ability to close poorly-resourced wards has some appeal, though again, a significant process would need to be put round this. The faith in a bonfire of the bureaucrats is slightly under-explained.

But their contributions could bring some much-needed fresh air into policy discussion and debate. Kudos to them for that. Moreover, they have kept faith with much of what was said last year, and built on it. Not all on solid foundations, but election proximity does that, I guess.

Sympathy for Ms Hewitt
Former heath secretary and special adviser to Boots and Ciniven Patricia Hewitt MP’s son has been arrested for possession of cocaine. Even hardline opponents of Ms Hewitt are likely to feel some sympathy for the difficult situation of finding out that your son is a sales rep.

Just kidding! A parent would always tend to worry about their child’s Class A possession.

It’s a salient and timely reminder, as was last week’s story about the success of recent initiatives to provide heroin legally, that the criminalisation of illegal drugs is a stupid policy as well as a failed one.

If we start from first principles: humanity has always sought to use a variety of substances to alter consciousness. No harm will be reduced or avoided by allowing the production and distribution of these substances to rest in the hands of organized criminals – or even worse, disorganised ones. Vast amounts of crime are associated with the high price and illegality of drugs. They could and should be legalised, regulated and taxed. We could use that revenue.