Meeting of the Parliament

Meeting date: Wednesday, January 23, 2019

Official Report 1228KB pdf

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Clinical Waste Services

The next item of business is a statement by Jeane Freeman on clinical waste services. The cabinet secretary will take questions at the end of her statement, so there should be no interventions or interruptions.

I am grateful for this opportunity to update members on the current situation on clinical waste services for the national health service in Scotland, and to set out the action that the Scottish Government has taken to support both NHS Scotland and those staff who lost their jobs after Healthcare Environmental Services Ltd ceased its business operations in December last year.

As members are aware, there has in recent weeks been considerable interest in Scotland and England in clinical waste services to the health service and, in particular, in Healthcare Environmental Services. Until recently, that company, which is based in Shotts, operated contracts with national health service boards and trusts across the country.

Clinical waste is a niche sector that requires specialist equipment, facilities and staff to manage the whole process from collection through to transportation and storage and on to final disposal and incineration. Since 2009, Healthcare Environmental Services has provided those services to our NHS. However, following concerns raised by NHS England about significant backlogs of waste being stored and enforcement notices being placed on HES sites in England, we understood that there was the potential for disruption to services in Scotland.

In August 2018, officials from the Department of Health and Social Care in England contacted the Scottish Government, raising concerns about the amount of clinical waste collected from NHS England sites and being stored at Healthcare Environmental Services sites in England. The volume of waste stored and being reported by the Environment Agency was about 700 to 800 tonnes, some of which breached storage conditions and/or exceeded the maximum storage times.

In October 2018, 15 NHS trusts in England terminated contracts with HES, with more reporting missed or late collections. At that time, HES sites in Scotland were not in breach of any environmental permits, licences or storage limits. However, on 12 September 2018 the Scottish Environment Protection Agency, as part of routine monitoring and inspection activities, issued two enforcement notices to HES relating to the tracking and management of waste; two further enforcement notices relating to the storage of waste were issued on 11 December.

The Scottish Government, NHS Scotland and SEPA were monitoring the situation closely, and were in close contact with authorities in England. Given the serious nature of the emerging situation, the Scottish Government directed NHS National Services Scotland to ensure that a national contingency plan, building on local board arrangements, would be ready for use in the event of any disruption to NHS waste collection services in Scotland. NSS was in contact with HES during that period, to ensure that HES was able to deliver its contractual obligations.

The company repeatedly provided assurance that it could meet those contract obligations, but on 7 December 2018 HES advised NHS boards in Scotland that it was unable to continue to provide clinical waste services with immediate effect. As required in the contract terms and conditions, HES was given up to 20 days to resume normal service, but the company failed to do so. The company gave notice that it had ceased trading from 27 December 2018.

Let me be clear that it was the company that breached its contracts—with 18 NHS boards—leaving Scotland’s accident and emergency departments, our hospitals, community health centres, general practitioner practices and dentists without essential clinical waste services.

With the planning work already in place, full contingency arrangements were operationalised across NHS Scotland to ensure that boards, GPs, dentists and others received the service. The contingency arrangements continue, and involve a range of companies in Scotland and across the United Kingdom working with NHS Scotland staff.

NHS National Services Scotland and NHS boards are closely monitoring local and national arrangements, and have acted quickly to resolve any emerging issues. Contingency arrangements are also subject to robust checks by SEPA and the Department for Transport, to ensure that all regulatory requirements are met.

Our priority throughout has been to ensure that measures are in place, so that NHS Scotland can continue to receive clinical waste services and public safety is assured. There have been no reports that patient care has been affected, or public safety compromised, and we are working to ensure that that remains the case. My thanks go to those staff who are working to support those arrangements.

Contingency measures, and ultimately maintaining NHS services, come at a cost. The Scottish Government has provided £1.4 million towards initial contingency planning, and NSS is leading on managing contingency arrangements on behalf of health boards. Under the terms and conditions of contract, health boards are entitled to reclaim costs incurred from HES, and will seek to do so.

The process for a new national contract for all NHS clinical waste management services in Scotland started in 2017, with tenders invited in 2018. The process is nearing completion. Final contract details and an implementation plan are being agreed with Tradebe Healthcare Ltd and should be concluded by the end of this month. The new contract is effective from 1 April this year for up to 10 years and has an estimated value of £100 million. My apologies, Presiding Officer, I believe that that figure should be £10 million.

The introduction of a single national contract that covers all health boards will further improve how NHS waste is managed and offer a range of community, educational and employment benefits. A new single national contract will bring various benefits to NHS boards and communities over the next 10 years and we are in a good position going forward. However, significant issues that are outside of ensuring NHS provision are yet to be resolved. Those issues relate directly to health environmental services and include supporting former employees—work that is being led by the Minister for Business, Fair Work and Skills—and maintaining environmental standards at HES sites in Shotts and Dundee; that work is being led by the Cabinet Secretary for Environment, Climate Change and Land Reform, with support from SEPA.

I know that the thoughts of members across the chamber are with the employees who lost their jobs at Christmas. This is, without question, a very difficult time for them and their families. The Scottish Government has provided and promotes a range of support to help people to find alternative employment and access redundancy payments. In November last year, we offered HES workforce support for its employees, which was not accepted until 27 December 2018. We also offered support to more than 125 employees at an event at the Salvation Army centre in Shotts on 3 and 4 January 2019, and in Dundee on 10 January. Feedback from that event suggests that a number of employees have already secured new work. Members will be pleased to know that, of the 262 staff across Scotland and England who are entitled to redundancy payments, 244 have now received the payments to which they are entitled from the redundancy payments service. [Jeane Freeman has corrected this contribution. See end of report.] The RPS will now try to reclaim those costs from the company.

Former employees, who have set up an action group called @ help healthcare, had a constructive meeting last week with the Minister for Business, Fair Work and Skills at which a range of issues was discussed. The group has written directly to its former employers to ask them to do the right thing and pay staff the wages that are owed for December. The Minister for Business, Fair Work and Skills also wrote to the managing director to seek agreement to approach the company’s bankers on the same issue. However, that request has been refused.

As already stated, HES was subject to four environmental enforcement actions in Scotland and several more in England. It is, therefore, essential that SEPA continues to monitor the sites in Shotts and Dundee to ensure that there is no risk to the public. SEPA also continues to seek regulatory compliance from HES to ensure that the sites are cleared safely and that all waste is disposed of appropriately, should that become necessary. There is, at present, no significant environmental risk and no risk to the wellbeing of local communities.

Scotland’s health services were placed at risk as a result of HES breaching its contract. Contingency arrangements that were developed in anticipation of such an eventuality—in consultation with NSS, SEPA and a range of other partners—ensured that there was no disruption to front-line services. The Scottish Government will continue to support former employees to access the money that they are owed and the benefits to which they may be entitled. However, that relies heavily on the co-operation of the company’s directors. SEPA will continue to monitor the Shotts and Dundee sites to safeguard the public and local communities, and will take enforcement action, should that be required.

I reiterate my thanks to those who are involved in ensuring that collections of clinical waste from NHS sites around Scotland continue and that front-line patient services remain uninterrupted.

My thanks and best wishes go to former employees of HES, who are being supported at this difficult time for them and their families.

Cabinet secretary, I know that you understand how important it is that members get the right figure in relation to the new contract that you mentioned. Will you confirm that figure for the chamber before we go any further?

Yes. I apologise—it was a typing mistake that, in my proofreading, I did not spot. The figure should be £10 million.

I presume that that is now clear to everyone.

The cabinet secretary will now take questions on the issues that were raised in her statement, for which I will allow about 20 minutes. I invite members who wish to ask questions to press their request-to-speak buttons.

There are many unanswered questions that the Scottish National Party must answer today. What steps have been taken to protect and train NHS staff who are currently tasked with handling hazardous clinical waste in our hospitals? That issue was not mentioned in this afternoon’s statement.

Will the cabinet secretary confirm that, under the proposals that she outlined today, all Scottish clinical waste will now need to be transported to England for incineration? What will be the additional cost to Scottish taxpayers? The cabinet secretary said that that would be £10 million, but it might be closer to £100 million by the time that the fiasco is cleared up.

Will the cabinet secretary confirm that all hazardous clinical waste is now being transported in vehicles that are designed to transport such waste and that all those vehicles display “Hazardous load” signage?

If there is a fiasco, it is not one of this Government’s making. The fact that those services have continued is thanks to the anticipatory measures in the contingency plan. Any break in services was caused by a private sector company failing to honour its contracts—it is important that we understand that. The Scottish Government did not cause or create this situation.

On protecting and training NHS staff, they have always had an involvement in the collection and preparation for onward collection of clinical waste, and that continues. Where additional measures have been asked of staff, boards have risk assessed those measures and have discussed them in the partnership forums that exist in boards, which is where discussions with staff and trade unions take place. In the Inverness case in which porters were injured as a consequence of their involvement in handling clinical waste, the NHS Highland board looked at the matter quickly, undertook measures to ensure that it could not happen again and employed an additional member of staff to assist in such work.

Waste is, indeed, transported south of the border for incineration, as was the case prior to the contract being broken by HES, with the exception of—in the latter stages of its contract—the incineration sites that it had in Shotts. As HES has ceased trading, those facilities are obviously not available under the interim arrangements. All the transportation must meet the regulatory requirements of SEPA and the Department for Transport. NSS is responsible for ensuring that the required standards are met, which is the case at this point.

When the UK Government convened a Cabinet Office briefing room A—COBRA—meeting, we all feared that this clinical waste scandal might affect the NHS in Scotland, the workforce of Healthcare Environmental Services Ltd and our communities. Devastatingly, those workers, who kept our NHS operating, were dumped by their bosses at Christmas without pay or notice. The contingency planning has not benefited those workers. NHS boards continued to put money into HES’s bank account, but, rather than staff being paid what they are owed in wages, people have been left to rely on food banks.

When did the Government know that the company was in serious trouble, and what pre-emptive steps did it take to protect the workforce? What is the cost of the contingency plans to health boards, and when were boards advised to stop paying HES? Given that the NHS retains a duty of care for the stockpiled waste, what negotiations are taking place with HES and other relevant parties over the future of the sites at Shotts and Dundee?

There were a number of questions; I hope that I have them all, but I ask the member to let me know if I do not, please.

I repeat that we are in this situation because a private sector company has breached its contract. With regard to the NHS continuing to put money into the bank account of HES, NHS Scotland paid money that was owed for services that were delivered up to the point when HES ceased trading and breached its contract. That is perfectly right. It had a bill, it was due to pay it, and it paid it.

It is very difficult to have discussions and negotiations with the company about the future of the sites at Dundee and Shotts because it has ceased trading but has not put itself into insolvency. That is part of the real difficulty that the employees face. They are owed their December wages. As I said in my statement, my colleague Mr Hepburn has attempted to intervene to ensure that they are paid those wages, but we need the company’s permission to speak to its bank, which has been refused.

The Government acted and, indeed, offered pay support to the company—I think that I said in my statement in November—but that was not accepted until 27 December. We cannot just walk into a site in that way; we do not have those direct powers, nor should we. Such matters get resolved by co-operation and discussion, but, if the other party will not co-operate and discuss, we are a bit stuck.

With regard to NHS Scotland and the continued safe removal and disposal of clinical waste, I have outlined that we took the necessary pre-emptive measures by ensuring that we had a contingency plan. At the point at which there were clear difficulties between NHS England and the company, we were able to operationalise those contingency plans. Despite the company having assured us on 7 December that it could meet its contract obligations and then, on 20 December, telling us that it could not, in a very short space of time we moved to do that.

I have probably missed one of the member’s questions. If one of her colleagues is going to ask me a question, perhaps they could pick that up for her and I will be sure to answer it.

The first two questions and answers have understandably taken a long time, as there was a lot of content. We will have to be a bit quicker if we are going to get through all the questions.

On 12 September, SEPA issued two enforcement notices, which were followed by a further two notices on 11 December. Within a couple of weeks, the company gave notice and ceased trading. Are we to understand that the Government and its agencies were completely unaware of the impending crisis? How frequent were SEPA’s inspections up to the point at which the situation became critical?

I have never said that the Government was completely unaware. If we had been, we would not have taken the necessary steps to know that there were difficulties between the company and health trusts in NHS England, and we would not have taken the necessary steps to ensure that, should there have been a difficulty in fulfilling the contract in Scotland, we had contingency plans to ensure that clinical waste would continue to be uplifted, stored and disposed of in a way that protected patients and public safety.

As I said in my statement, as soon as it became clear that there were difficulties south of the border, we understood that there was the potential for problems in Scotland. However, at that point, there was no significant difficulty. SEPA, as part of its normal inspection process—I am happy to check exactly what the frequency of the inspections was over the contract period and advise Alison Johnstone of that number—issued those two enforcement notices initially and then, subsequently, issued two further enforcement notices. Of course, a company has time to comply with such notices. However, on 7 December, the company advised us that it could not meet its contract obligations. We gave it the 20 days to which it was entitled to get back to a place where it could do so. However, on 27 December, it advised us that it had ceased trading.

HES also held the contract for the disposal of animal remains and clinical waste from Edinburgh zoo, which is in my constituency. Are there still animal remains at the Shotts site? What other non-NHS contracts did the company serve? What contingency is being offered to those companies to facilitate the safe disposal of their clinical waste?

My understanding—I will check this and return to Mr Cole-Hamilton on the matter—is that, where there is clinical waste for disposal, whether it is of animal or human origin, the contingency arrangements are picking up on that obligation.

I do not have any information about any other non-NHS contracts that the company had. I do not know whether the Government holds that information, as it would be company information. I am, therefore, unable to give Mr Cole-Hamilton that information this afternoon.

We are more than halfway through the session. I have a little bit of extra time, but not much. I ask for short questions and answers, please.

The cabinet secretary will be aware of reports of a build-up of clinical waste at the Coatbridge health centre in my constituency. I raised the matter in a supplementary question in the chamber last week. The local paper, the Airdrie & Coatbridge Advertiser, has since highlighted the issue again, and the matter has had wide circulation. Will the arrangements that are being put in place prevent any future build-up of waste?

My understanding is that collections have returned to normal and are being monitored on a daily basis by NSS. There was a back-up of clinical waste at NHS sites, which was due to a diminution of service from HES prior to its ceasing trading and before the new arrangements were put in place. Of course, in some instances, those new arrangements took a little bit of time to bed in. However, my understanding is that, now, collections have returned to normal, the backlog has been cleared, and the situation is being monitored on a daily basis.

Last week, the Cabinet Secretary for Environment, Climate Change and Land Reform, Roseanna Cunningham, estimated that the total clearance and disposal cost would be around £250,000. I note from the health secretary’s statement that the Scottish Government has provided £1.4 million towards the initial contingency planning. With that in mind, is she confident that the costs will not continue to rise exponentially?

As Mr Whittle rightly says, the £1.4 million is towards the initial contingency planning, and NSS has now taken over the management of the contingency arrangements. Of course, what that means is that our boards are no longer paying HES for services that they are not receiving. When we get to the end of the contingency period and the new contract starts, we will be able to rebalance the funding between what our boards would have normally paid to HES for the months in which there have been contingency arrangements and the amount of money that NSS has paid out to cover those contingency arrangements. At that point, I will know whether there is a gap between what would normally have been paid and what we have had to pay for contingency arrangements.

Of course, contingency arrangements carry additional cost, because they involve bringing in trailers and securing additional storage facilities and so on to ensure that the service can continue to be delivered. When we get to the end of the contingency period and the new contract begins with a new contractor, I will be able to give Mr Whittle and other members the exact cost of the contingency arrangements in full and I will be able to say how that is balanced against what our boards would normally have paid to HES, and whether there is a deficit between those two figures.

As the constituency member for Shotts, I thank the Scottish Government for the tremendous help that it has given so far to the workers who have lost their jobs at Hassockrigg in Shotts. However, I wonder whether the Government can give further assistance. My colleague Neil Gray and I have brought in specialist lawyers and have found that, if people go through the normal employment tribunal process, it will take six to nine months before they get their wages and other payments that they are due. Can pressure be brought to bear to speed up the process?

I also have a specific question for the health secretary. When the new contract is being awarded, will she put pressure on the new contractor to give priority to recruiting former HES workers in carrying out the new contract, particularly as the Transfer of Undertakings (Protection of Employment) Regulations do not apply in this case?

On the first part of Mr Neil’s question, I will ask my colleague Mr Hepburn to respond in writing on whether the Government might do anything further to insist that employees receive the December wages that they are due, which I believe is what Mr Neil was asking about. I do not want to intervene in another portfolio and talk about something that I do not know anything about, so Mr Hepburn will respond.

On the second part of the question, which was important, NSS, in conjunction with Tradebe Healthcare, is arranging for an information and recruitment day to be held in Shotts in the next few days and, when we have the exact date for that, I will ensure that all relevant members, including Mr Neil and other colleagues, are aware of that date, and the employees of the former company will certainly be informed. The new company that will take over the contract once all negotiations are concluded, which will be by the end of this month, will hold that information and recruitment day. I hope that that gives Mr Neil and, more importantly, those who have lost their jobs with HES some assurance.

I back Alex Neil’s call for no stone to be left unturned to ensure that the workers get the money that they are due. Workers in Dundee are waiting for wages that they are due, too.

The health secretary talked about the cost of contingency plans to health boards. Is the Scottish Government pursuing HES’s insurers to find out whether the public purse can recover some of that cost?

I have another brief question, just to clarify the cabinet secretary’s answer to Ms Lennon. She talked about the 10-year contract being worth £10 million. We are a little unsure of that, because we understand from the press that three health boards made a payment of approximately £1 million for the past three months.

Could you speed up, please, Ms Marra?

The figure of £10 million that the health secretary gave does not really stack up, so it would be helpful if she could clarify that.

I clarify that some members will not get to ask questions because of the time taken by their colleagues.

I apologise to members for causing considerable confusion about how much the contract is worth—it is £10 million a year for 10 years, so it is £100 million. I hope that that clarifies that for the record.

On leaving no stone unturned, I believe that the Government is doing everything that it can. Mr Hepburn has advised me that, as well as seeking the company’s permission to contact its bank, which was refused, he has now written to the bank on behalf of the employees to see whether the bank can assist in ensuring that they receive the moneys to which they are entitled.

On Ms Marra’s question about HES insurers, we are seeking legal advice on that and on a range of matters relating to the contract. I am sure that she appreciates that there are three portfolios involved, from the perspectives of the environment, the employees and the business, and the NHS, which is my interest and concern. We are looking at all ways in which we may assist in order to find a resolution of the matter.

I welcome the robust contingency plans that NHS Scotland has developed. Can the cabinet secretary confirm that those measures will remain in place until a new contract begins and that the new contract will, at the very minimum, adhere to those standards?

The contingency arrangements will remain in place until we are confident that the national contract is fully operational. The new national framework agreement includes an updated specification, meets the Scottish Government’s current environmental targets and provides greater visibility of waste streams, locally and nationally. Using a single contract for the whole of Scotland’s health service is exactly what we should be doing, rather than using a series of individual board contracts.

Given what she has said about the bank and other matters, is the cabinet secretary satisfied with the level of engagement and co-operation that the Scottish Government has received from HES since this situation first came to light?

No, I am not. I do not think that anyone is satisfied. The skilled and experienced employees of the company who have worked hard have not been treated fairly or well. Christmas is a particularly difficult time of year for people to be told that they have lost their jobs, and it is completely unacceptable for workers to be told that with no notice and for them not to be paid the wages that they are due. I am not satisfied with the way in which the company has handled its contractual obligations to our national health service or its contractual and other obligations to its workforce. Since the autumn of last year, the Scottish Government and Scottish Enterprise have been trying to co-operate with HES by offering a range of business support and support for the workforce, but we have had little, if any, co-operation.

On the health service contract, any company that takes contract obligations seriously would not advise, over a very short space of time, that it cannot meet its contractual obligations and say, over an equally short space of time, “That’s it. We have packed up shop,” and cease trading.

That concludes questions on the statement on clinical waste services. I apologise to Alison Harris, James Kelly and Shona Robison, whom I was not able to call.