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FULL TRANSCRIPT

   1                      Day 30, 17th June 1999
   2   (9.30 am)
   3   THE CHAIRMAN: Mr Maclean, good morning. Good morning,
   4     ladies and gentlemen.
   5   MR MACLEAN: Good morning. Sir, this morning's witness is
   6     Mr Peter Durie, who was the Chairman of Bristol & Weston
   7     Health Authority for about four years and subsequently
   8     the first Chairman of the UBHT. Mr Durie is represented
   9     by Mr Stephen Miller QC.
  10        Can we have Mr Durie, please?
  11        Mr Durie, the first thing we ask a witness to do
  12     is to stand and take the oath, please.
  13            MR PETER DURIE (sworn):
  14            Examined by MR MACLEAN:
  15   Q. Your full name is Mr Peter Durie?
  16   A. That is so.
  17   Q. You retired a number of years ago now as the Chairman of
  18     the United Bristol Healthcare Trust?
  19   A. Yes, five years ago.
  20   Q. Can I ask you to look at the screen beside you, please,
  21     and can we have document WIT 86/1, please?
  22        You have put what we call a formal written
  23     statement in to the Inquiry and that is the first page
  24     of it, is it not?
  25   A. That is correct.

   1   Q. If we go, please, to page 23, that is your signature, is
   2     it not?
   3   A. It is.
   4   Q. Between pages 1 and 23, that comprises your statement to
   5     the Inquiry?
   6   A. It does.
   7   Q. There are one or two appendices which I will come to in
   8     a moment. Have you had a chance to read that statement
   9     recently?
  10   A. I have.
  11   Q. Is there anything in it you now wish to alter, change or
  12     add to?
  13   A. No, there is not.
  14   Q. You have also helpfully supplied us with a couple of
  15     appendices. If we go to page 24, Appendix A, and over
  16     the page to 25, if you just turn that around, this is
  17     a family tree which you have created to show us the
  18     organisation of the Health Authority in the latter part
  19     of the 1980s?
  20   A. Yes. That is correct. I thought it might be helpful to
  21     see how large and complex it was.
  22   Q. I think the Inquiry has heard evidence already about the
  23     South and Central unit divide, and the Bristol Royal
  24     Infirmary and the Children's Hospital were part of the
  25     Central unit?

   1   A. Yes, they were.
   2   Q. Page 26, and then over to 27. This is a similar
   3     diagram, this time in respect of the Trust?
   4   A. Again, the purpose of putting that in was to show that
   5     although we had lost one or two parts like Weston
   6     hospital and the mentally handicapped, as it was then
   7     called, it was still a large and complex Trust.
   8   Q. If we go to 28 and over to 29, Appendix C, we will come
   9     back to these later, Mr Durie. These are the issues
  10     which required the approval of the Trust Board. If we
  11     scan down, there were 16 of them. These come from the
  12     standing orders Appendix B, we see that at the top of
  13     the page?
  14   A. Yes, that is correct.
  15   Q. Finally, I think, page 30 is the cover sheet and
  16     page 31: these are items which do not require Trust
  17     Board approval but rather issues of which the Trust
  18     Board had to be informed?
  19   A. Yes.
  20   Q. A kind of second order type of matter for the Trust
  21     Board to consider?
  22   A. Yes.
  23   Q. Again, those come from the standing orders of the Trust?
  24   A. Yes.
  25   Q. Just to tidy up the housekeeping, you have helpfully

   1     provided a short comment on the witness statement of
   2     Mr McKinley from whom we hope to hear in due course.
   3     Mr McKinley's witness statement is at WIT 102/1. That
   4     is a statement that you have read, if you scan down the
   5     page?
   6   A. It looks similar. I do not have it in front of me to
   7     compare, but it looks similar.
   8   Q. I do not think it is necessary to go through your
   9     comments on that statement in detail, but it is right to
  10     say that you are in a very broad measure of agreement
  11     between yourself and Mr McKinley in so far as his
  12     statement explains the general position?
  13   A. Yes, I am.
  14   Q. And he was your immediate successor as Chairman?
  15   A. That is correct.
  16   Q. Two people have commented on your statement. If we go
  17     to WIT 86/32, I do not know if you have had a chance to
  18     see these, but these are the comments of Mr McKinley on
  19     your statement.
  20   A. I have read that, yes.
  21   Q. Again, there is a broad measure of agreement?
  22   A. Yes.
  23   Q. And the other comment, you may not have had a chance to
  24     see. They are from Mr Wisheart. I will give you a copy
  25     of those in the break and we will come back to those

   1     later, but they are short and relatively
   2     uncontroversial, I think.
   3        You say in your statement that you were the
   4     Chairman of the Bristol & Weston Health Authority from
   5     1st April 1986 until 1st April 1990?
   6   A. Yes.
   7   Q. You were then the Chairman of the Trust from 1st April
   8     1991 until 30th June 1994. You had previously worked
   9     for Courage, the brewers. You held a senior position
  10     with that organisation.
  11        Could I just ask you to comment in general terms
  12     as to the differences that you found having moved from
  13     the private sector from Courage in 1986, and having been
  14     a main Board Director and Assistant Managing Director of
  15     Courage in 1986, you moved to the Bristol & Weston
  16     Health Authority? What changes did you notice, moving
  17     from the private to the public sector?
  18   A. There were a number. I think the most striking was the
  19     great dedication and commitment of all doctors, nurses,
  20     carers and virtually everybody working within the NHS.
  21     I would like to pay tribute to that. In business, you
  22     tended to work up incentive schemes to try to get people
  23     to work harder. There was no requirement for that at
  24     all in the NHS; everybody worked very hard indeed. In
  25     fact the problem was to try to not let them try to treat

   1     patients when there was no resource available for those
   2     additional patients to be treated.
   3        That is the first point. The second one was, in
   4     business most people were aware of what costs were and
   5     had an understanding about costs. The consultants,
   6     doctors in particular, and I think many others, just did
   7     not wish to get engaged about what anything cost. They
   8     just felt that that was totally irrelevant and whatever
   9     was needed must be provided.
  10        There were other points. I think that there was
  11     a great difficulty in deciding in the NHS which was the
  12     most worthwhile of the many opportunities to try to put
  13     more resource in or develop. In business on the whole
  14     that was not too difficult to find. In the NHS it was
  15     very difficult, because each one seemed to be so worthy
  16     and it is just of interest, when I was Chairman of the
  17     Health Authority, we in fact organised some seminars to
  18     try to help us decide how did we make these choices?
  19     The Bishop of Bristol came and led one of the seminars
  20     for us, but it was a very difficult task indeed to
  21     decide which was the most important of the many causes
  22     into which you could put the limited resource.
  23        I think last and certainly not least is the issue
  24     of decision-makers. In business it was fairly clear
  25     that the decision-makers were usually quite high up in

   1     the organisation and you tended to have, then, an
   2     organisation which was probably rather like a pyramid,
   3     hierarchical, so by the time you got down to the
   4     equivalent of what we might call the shop floor, there
   5     were very clear instructions of what had to be done and
   6     what was required.
   7        Of course, in the National Health Service that is
   8     totally different, because the people who make the
   9     important decisions about which patients need which
  10     treatment and what should happen are the people who you
  11     might call right "at the coal face", the consultants, so
  12     the management structure to succeed in the NHS was
  13     a very different type of organisation and it was more
  14     supportive than prescriptive as would happen in
  15     business. I think those are some of the main
  16     differences in culture that I found.
  17   Q. You say in your statement -- WIT 86/2, the top of the
  18     page, that the way in which Health Authority Chairmen
  19     were recruited at this time -- the mid-part of the
  20     1980s, approaches were made to large companies to
  21     recruit chairmen and you were asked whether you would be
  22     interested. You go on to say you had some then links
  23     with a London hospital, approaching retirement from the
  24     private sector and submitted yourself for interview.
  25        Who asked you whether you would be interested, and

   1     who was it who interviewed you for the post?
   2   A. From my recall, a letter came round to large companies
   3     from, I think, the Department of Health. It was at this
   4     time they were introducing the concept of general
   5     management in the NHS and they were therefore seeking
   6     people who had been quite senior in general management
   7     in private industry to come and offer themselves to be
   8     appointed to the Health Authorities. So I think the
   9     letter came not to me personally; it came to Courage as
  10     a firm and the Personnel Director I remember showed it
  11     to me knowing I was going to be retiring within a few
  12     months.
  13        The interview process, I was certainly seen by
  14     the Regional Chairman, and I cannot remember who else.
  15   Q. Then what was your understanding of the decision-making
  16     process? If the Regional Chairman and whoever else it
  17     was decided to opt for you, was that a fait accompli?
  18   A. No, the actual formal appointment came I think from the
  19     Minister of Health.
  20   Q. You say in paragraph 4 that the Chairman's role was
  21     somewhat ill-defined. What kind of guidance or
  22     instruction or rules were you given or told about when
  23     you took up post, for your own job?
  24   A. It is a long time ago so my memory is far from
  25     complete. I got a very good briefing from my

   1     predecessor as Chairman of the Bristol & Weston District
   2     Health Authority. I then met and talked with the
   3     Regional Chairman of the South West Regional Authority.
   4   Q. The same person who had been in the interview panel?
   5   A. Yes.
   6   Q. There was no other training or -- you were put in post
   7     and then you saw it as your role to shape your own
   8     responsibilities?
   9   A. I cannot recall whether there was a written "job
  10     description" or not. I cannot recall it. It could have
  11     been, otherwise, as you say, once you were in the post
  12     you were given support by the other members of the
  13     authority and you were given support where required if
  14     you asked it from the Region.
  15   Q. What type of commitment in terms of time were we talking
  16     about as Health Authority Chairman?
  17   A. I know it was not as great as when we became a Trust,
  18     but from memory I think I was in there two days, two and
  19     a half days a week.
  20   Q. When the Trust came into being in 1991, the commitment,
  21     I think, was about three days a week, was it?
  22   A. It really worked out about three full days a week.
  23     I probably would have been in about four days, but not
  24     for all of those days.
  25   Q. That would have been a paid position?

   1   A. Both were paid. We were paid an honorarium as Chairman
   2     of the Health Authority, and you were as the Chairman of
   3     the Trust.
   4   Q. Do you remember what the starting salary, if that is the
   5     right expression, was?
   6   A. I think from memory it was œ5,000 when it was a Health
   7     Authority and I think from memory something like œ16,000
   8     when it was a Trust.
   9   Q. At WIT 86/3 you mention in paragraph 7 the three days
  10     a week, and so on. Coming down to paragraph 9, the foot
  11     of the page -- this is moving on to the Trust concept --
  12     you say:
  13        "I was a supporter of the Trust concept. I could
  14     see that theoretically at least it could provide
  15     a number of benefits: in the first place it would free
  16     the Health Authority from much of the bureaucracy of the
  17     NHS."
  18        When you were referring to "Health Authority",
  19     you were referring to what was known in 1990 as the
  20     "provider unit"; is that right?
  21   A. No, I am talking about Bristol & Weston District Health
  22     Authority, what we had been before.
  23   Q. So the Trust was going to free both the purchaser and
  24     the provider side from bureaucracy; is that right?
  25   A. I could not answer for the purchaser. I was certainly

   1     talking in here about us, the providers.
   2   Q. You were the Chairman of the Health Authority between
   3     1986 and 1990?
   4   A. Yes.
   5   Q. And then there is a hiatus until 1991, when you became
   6     Chairman of the Trust?
   7   A. Yes.
   8   Q. Can you first of all explain what you were doing in the
   9     year in between and why you chose to do that job rather
  10     than continue as Chairman of the Bristol & Weston
  11     District Health Authority?
  12   A. Answering your last point, I was not actually given an
  13     option of continuing. By the time I was coming towards
  14     the end of my four years, it was getting increasingly
  15     probable that the concept of the provider/purchaser
  16     split would come about and there would be Trusts.
  17        I was then asked, from memory, would I be the
  18     purchaser, would I agree to become the purchaser. I did
  19     not wish to be that. I was interested in the provision
  20     side, so I said no.
  21   Q. Who asked you?
  22   A. I was asked by the Regional Chairman.
  23   Q. So you did not fancy that job?
  24   A. I did not want to do that job. I did want to continue
  25     to be involved with the hospitals and the provision of

   1     health care and, that being so, in my case -- I do not
   2     know whether it is always the same -- I was not
   3     reappointed to continue to be the Chairman of Bristol
   4     & Weston District Health Authority until some change
   5     came about at a later date. Somebody else was appointed
   6     instead of me, and I was no longer involved with the
   7     National Health Service, except I think I had the title,
   8     something called -- some funny title they dreamt up for
   9     people who helped work out applications for Trust
  10     status.
  11   Q. So you ceased to have any formal role as chairman of
  12     anything?
  13   A. Correct.
  14   Q. But you were actively assisting the application that was
  15     being made on behalf of the Bristol provider unit to
  16     become what became the UBHT?
  17   A. Correct.
  18   Q. And the leading light in that application was
  19     Dr Roylance, who had been the District General Manager
  20     of the Bristol & Weston Health Authority?
  21   A. Yes.
  22   Q. The Regional Chairman who asked you if you wanted to
  23     take on a role on the purchaser side: do you remember
  24     who that was?
  25   A. I am not certain. I think it was still Vernon Seccombe

   1     but I am not sure whether he had been succeeded by that
   2     time.
   3   Q. Mr Seccombe had been appointed the Regional Chairman by
   4     the time you were appointed?
   5   A. That is correct.
   6   Q. He would have been the main part of the interview
   7     process and to whom you would have spoken having taken
   8     up the appointment?
   9   A. He was.
  10   Q. At this stage there is a plan for purchaser/provider
  11     split to occur in the Health Service and I think you are
  12     anxious to explain to us that that concept of
  13     purchaser/provider is a separate concept from the Trust
  14     concept; is that right?
  15   A. It is. To me, that was the most important change that
  16     then came about: Trusts were secondary because up until
  17     that time, as a Health Authority, we had received a sum
  18     of money; we had hospitals, and in theory, we treated
  19     everybody who would benefit from treatment.
  20        The reality was the amount of resource given was
  21     not enough to make that possible, so we were in the
  22     difficult position of not only providing health care but
  23     also having to make decisions about which bits we did
  24     and which bits we did not do.
  25        In my view, splitting it into the clarity of

   1     purchaser/provider meant -- and no politician of any
   2     party could say it -- that the rationing of health care
   3     was being decided by what the purchaser decided to buy,
   4     and we, the provider, then actually had a clearer brief,
   5     because we should not be concerning ourselves about what
   6     we were not doing; we should be concerning ourselves
   7     about providing very high quality care within what got
   8     known as "contracts" between us and the purchaser.
   9   Q. So in that sense, it took away some of the difficulties
  10     from the provider because the provider had a very easy
  11     to say task of simply providing that which somebody else
  12     had bought?
  13   A. It did that, and it also ended the myth that if only we
  14     were more efficient, somehow we would be able to treat
  15     everybody.
  16   Q. So that, as you saw it, was the primary concept:
  17     purchaser/provider?
  18   A. In my view, that was more important than the setting up
  19     of the Trust, although the Trust had benefits.
  20   Q. The purchaser/provider could come about in one of two
  21     ways: either the Health Authority would be the purchaser
  22     and the Trust would be the provider, or the Health
  23     Authority would be the purchaser and something known as
  24     a directly managed unit still run by the Health
  25     Authority could be the provider?

   1   A. That is correct.
   2   Q. What, as you saw it, were the advantages or
   3     disadvantages of the Trust being the provider rather
   4     than a directly managed unit?
   5   A. It was the ability to have freedom of action. I used
   6     I think in my statement the words we were "free from
   7     bureaucracy". Can I try to explain what I mean by
   8     that?
   9   Q. Do, yes.
  10   A. The National Health Service being very large, it
  11     understandably became rather cumbersome and there was
  12     paper, paper, paper, all the time. A lot of the paper
  13     being generated and seen and read and passed around
  14     appeared to have very little purpose.
  15        We were freed from most of that paperwork, which
  16     enabled us to concentrate on the paperwork which
  17     mattered. We could concentrate on trying to ensure that
  18     patients' records were better and that key minutes of
  19     meetings were clear. So that was a first attraction.
  20        On appointments, if we wanted to produce a special
  21     appointment for a nurse in one of the specialties, we
  22     would have had to apply through to Region to get
  23     approval because we were doing something which was not
  24     quite within the norm of the pattern of every
  25     appointment.

   1        As a Trust, each specialty could ensure that if
   2     they felt that there was an appointment -- I was quoting
   3     a nurse but it could be somebody else -- who was needed
   4     to fit a particular niche in that specialty, it was
   5     within our freedom of action to make that appointment.
   6        Having said that, we did not want to throw away
   7     everything; we very much kept within the general Whitley
   8     agreements, but it gave us much quicker freedom of
   9     action for appointments.
  10        On capital --
  11   Q. Why would not the directly managed unit have had similar
  12     feedback?
  13   A. Because they had not cast off all this welter of
  14     organisation I spoke about.
  15   Q. But the directly managed unit would actually be run by
  16     a separate part of the Health Authority, would it not,
  17     compared to the purchaser part of the same Health
  18     Authority?
  19   A. I was not there so I cannot be certain, but I do not
  20     believe they actually were. I think the system went on
  21     as business as before.
  22        The last point I would want to make on bureaucracy
  23     is capital: you did not have more capital, but before,
  24     for really quite a small sum, you had to fill in reams
  25     of paper and send it up to be considered as part of the

   1     regional capital allocation and you never hear an answer
   2     for a year. As a Trust you could make a decision as
   3     quickly as you wanted, whether it was a small sum, or,
   4     in our case, within a year of becoming a Trust, we had
   5     made the important decision that we would actually have
   6     a new building for the Children's Hospital.
   7   Q. We will come on to that in a bit more detail.
   8        To finish off on the Health Authority, when you
   9     were the Health Authority Chairman, with whom did you
  10     work most closely?
  11   A. I would work most closely with the General Manager --
  12   Q. Of the District?
  13   A. Of the District.
  14   Q. Dr Roylance?
  15   A. Dr Roylance and the senior -- they were then known as
  16     "officers" working for him, because I would also work
  17     with some of the members of the Health Authority. There
  18     were 24 members and some were able and wished to put in
  19     more time than others, so I would be working more
  20     closely with them.
  21   Q. There was a District Health Authority and there was
  22     a Regional Health Authority?
  23   A. Correct.
  24   Q. You were a member of the district?
  25   A. Yes.

   1   Q. How were the Health Authority members appointed?
   2   A. I cannot recall all. Some of them were local authority
   3     members designated by the local authorities. From
   4     memory the other members were approved by region. There
   5     was not a great turnover of members, so my memory is not
   6     clear as to whether I suggested a name they approved of
   7     or whether they gave me a name. I am not sure of that.
   8   Q. So it was part quasi electoral in the sense that some
   9     people in the Health Authority were councillors who were
  10     there because they had been elected as local authority
  11     representatives, and part quango?
  12   A. That is right, and it was stipulated that there would be
  13     at least one GP on it, et cetera.
  14   Q. And the Regional Health Authority: what was the
  15     relationship between you as Chairman of the District and
  16     either the Regional General Manager or the Regional
  17     Chairman?
  18   A. The Regional General Manager you mentioned first. The
  19     Regional General Manager worked with the District
  20     General Manager. They had their network. Although
  21     I talked with the Regional General Manager, my direct
  22     reporting was to the Chairman of the region.
  23   Q. He would report in turn --
  24   A. He was reporting in those days I think directly to the
  25     Minister.

   1   Q. When you became Chairman of the Trust, what difference
   2     did that bring to your working relationship with
   3     others? You tell me what happened to the Region.
   4   A. Region continued to be there, but if one drew a diagram,
   5     we were no way responsible to the Region. They existed
   6     still and so our relationship with the Region continued,
   7     but it was one of meeting when we had a common interest
   8     rather than me meeting because that was my duty so to
   9     do.
  10        It was not in theory, I think. Right to begin
  11     with we actually reported directly to the Secretary of
  12     State. It was a very unclear situation. It was
  13     evolving all the time. The first-wave Trusts were
  14     established and the rules were being made as the initial
  15     months took place.
  16   Q. So the Regional Health Authority was not the provider of
  17     health care because the Trust was?
  18   A. The Regional Health Authority would still be managing
  19     some people who were providing, but they were still
  20     responsible for the directly managed units.
  21   Q. But in a Trust --
  22   A. In a Trust way, the Regional Health Authority were not
  23     our "boss" for that.
  24   Q. They neither provided nor directly purchased health
  25     care?

   1   A. They could purchase direct. I do not know the details.
   2     Some supra-regional specialties I think still got funded
   3     direct from Region, not from the subsidiary purchasers.
   4   Q. I do not think we need to go with you into the
   5     supra-regional sector. The Panel has heard much
   6     evidence of that already.
   7        Now can we go to UBHT 98/258, please?
   8        This is a meeting of the Hospital Medical
   9     Committee. Can we just go to the foot of the page.
  10        We see you were in attendance at this meeting?
  11   A. Yes.
  12   Q. And so was Dr Roylance; and so was Mr Mortimer. We will
  13     hear about him later too. This is 1990, I think.
  14        "Mr Dean Hart said it seemed likely that the White
  15     Paper in the Health Service would receive Royal assent
  16     at the end of June. From that point the authority had
  17     the straight choice of becoming a Trust or a directly
  18     managed unit. He was aware that some members ..."
  19        I do not need to read the rest of that.
  20         "Mr Dean Hart said consultants in Avon had voted
  21     overwhelmingly against Trust status on the information
  22     then available. Since that time, further information
  23     had been forthcoming from the Department of Health and
  24     from those who had been asked to produce a business
  25     plan. He felt therefore that it would be right to

   1     rethink the position and had asked Mr Peter Durie and
   2     Mr Mortimer to address the HMC on Trust status and
   3     directly managed units respectively. Both persons had
   4     thought very deeply about the Health Service and he
   5     appreciated their giving up time to talk to the
   6     consultant staff."
   7        Why do you think you and Mr Mortimer should
   8     respectively have been selected to talk on Trust status
   9     and directly managed units?
  10   A. Because Mr Dean Hart knew that I was in favour of what
  11     is now UBHT becoming a Trust, because of the benefits,
  12     some of which I have tried to describe.
  13        Mr Mortimer was the Chairman who took over from me
  14     in 1986 and he was strongly against --
  15   Q. In 1990?
  16   A. I beg your pardon, in 1990. He was strongly opposed to
  17     the whole concept of Trusts anywhere. So he was
  18     vehemently against the concept of Trusts. Therefore,
  19     Mr Dean Hart had somebody who was in favour and somebody
  20     who was vehemently against.
  21   Q. Would you describe yourself as being vehemently in
  22     favour?
  23   A. No. I am not sure I would wish to be vehement on an
  24     issue like that, but I felt strongly there was benefit
  25     to be gained by being a Trust.

   1   Q. You were very early on convinced that Trusts was the
   2     correct route to go down?
   3   A. If Trusts came into being, I was convinced Trusts made
   4     sense. I was not strongly interested if Trusts did or
   5     did not come into being, but if they did, I believed
   6     that was a course we should follow.
   7   Q. In the penultimate paragraph on the same page:
   8        "Mr Durie said that the proposed management team
   9     for the Bristol Trust had a proven financial and
  10     managerial record and he felt that it was right to apply
  11     for Trust status as early as possible as it was unlikely
  12     that the government would allow the first ones to fail."
  13        Was that the rationale for trying to be quickly
  14     "out of the blocks" in applying for Trust status?
  15   A. It was one of them; not the only one. If you are
  16     entering a situation where it is still quite uncharted,
  17     I believe you will benefit if you are the one doing the
  18     charting rather than having to come behind and accept
  19     somebody else's charting.
  20        Also my own belief was that we were likely to have
  21     more favourable financial treatment as a first-wave
  22     Trust than later on.
  23   Q. How, relatively speaking, complex and complicated was
  24     the Bristol provider unit compared to other putative
  25     Trusts? Was it going to be particularly difficult to

   1     make a Trust out of the Bristol provider unit?
   2   A. The Health Authority, as we saw from those earlier
   3     attachments to my statement, were used to handling this
   4     large complex organisation, and part of their role was
   5     being the provider, so, as I said I think in that
   6     paragraph, there was proven managerial competence in
   7     running the organisation because it was intended to
   8     bring from the Health Authority into the Trust the key
   9     people from the Health Authority.
  10   Q. Dr Roylance and his senior managers?
  11   A. Yes. There were benefits of being large because on
  12     things like IT and some of the central services, you
  13     actually benefited from size rather than a small one
  14     trying to have to do all that itself. So although it
  15     was complex, we had confidence that we had the ability
  16     to manage something large and complex.
  17   Q. It was relatively speaking very large and very complex
  18     compared to the majority of first-wave Trusts?
  19   A. I cannot answer that. I am not sure compared to the
  20     first wave, but compared -- I cannot answer that.
  21   Q. Can we go over the page to 261? The penultimate
  22     paragraph. This is the other side of the argument:
  23        "In conclusion, Mr Mortimer said that the
  24     advantages of directly managed units were that they
  25     existed currently and were still evolving and that the

   1     purchaser/provider role in such units had been well
   2     proven in industry. The retention of the link at DHA
   3     and DGM level provided a means of ensuring the overall
   4     interests were given priority. The disadvantages of
   5     having Trusts was that RHAs would be co-ordinating
   6     a greater number of units/districts and he believed that
   7     units should be responsible to a local Health
   8     Authority ..."
   9        We see what he says. He had no confidence that
  10     the government would review any Trust that found
  11     insurmountable problems.
  12        So that was Mr Mortimer's case for DMUs.
  13        The Executive Director posts, the putative
  14     executive directors of the Trust: how were they
  15     appointed?
  16   A. There was a system whereby the new Chief Executive was
  17     appointed first. I cannot remember, I have a feeling
  18     that we had to get agreement to appoint the new Chief
  19     Executive from them, and I cannot tell you who "them"
  20     were, but it was not within the gift of the Trust to
  21     decide who its own Chief Executive would be, it had to
  22     be authenticated by somebody else.
  23   Q. We will see the formal meetings of the Trust in due
  24     course, but in the months leading up to Trust status,
  25     everybody knew who was going to be running the Trust

   1     once it was set up. In fact it was going to be
   2     Dr Roylance, Mr Nix, Mr Stone, Mrs Maisey and so on. We
   3     have seen, for example, Mrs Maisey being described as
   4     Director of Operations six months before the Trust was
   5     formally instituted.
   6   A. Yes.
   7   Q. How did those people assume those shadow director roles?
   8   A. That was all part of the process of working up the Trust
   9     application. Part of it was to show credibility: that
  10     if we were given Trust status, we had the competence to
  11     run this new Trust and those people had already shown
  12     their competence in the Health Authority so it was an
  13     evolutionary one. One obviously checked they were happy
  14     to be those people and did not want to go off and do
  15     something different. From recall, the person who had
  16     been the Treasurer of the Health Authority went off to
  17     do something different.
  18   Q. Mr Parr?
  19   A. Yes.
  20   Q. Was there any formal competition or selection process?
  21     Taking Mr Stone as an example, if he said he was happy
  22     to become Director of Personnel, was that it: he was
  23     Director of Personnel?
  24   A. Yes. If we thought that he had the competence, and the
  25     "we" at this stage was myself helping to build up the

   1     application and the person we hoped to be the Chief
   2     Executive, Dr Roylance, but it was in fact a consensus
   3     decision that they had the competence and should be the
   4     people rather than the two of us disappearing off by
   5     ourselves and just coming up with a fait accompli.
   6   Q. Can we look at UBHT 6/302? This is a Mission Statement
   7     developed for the Trust application. Can we scan down
   8     the page? That is dated 11th February 1991. That would
   9     have been put together by Dr Roylance and the shadow
  10     Trust team?
  11   A. I assume so.
  12   Q. Perhaps a more useful document, UBHT 60/8.
  13        This is the Executive summary of the application
  14     for Trust status. You had a role in making the Trust
  15     application?
  16   A. Yes, I am sure -- I cannot recall it, but I am sure
  17     I would have been shown the drafts of this and would
  18     have made the changes I thought were necessary.
  19   Q. Can we go to UBHT 60/11, paragraph 7, Leadership and
  20     Management:
  21        "The style and structure of management in the
  22     Trust will be founded on continuing strong leadership
  23     and maximum delegation of authority to Clinical
  24     Directors and managers."
  25        One might think that there would be a tension

   1     between strong leadership on the one hand and maximum
   2     delegation of authority on the other.
   3        First of all, did you perceive such potential
   4     tension, and how was that strong leadership to go hand
   5     in glove with the maximum delegation of authority?
   6   A. You do not have to have conflict if there is clarity.
   7     The clarity was that the specialties which were set up
   8     with a Clinical Director and NHS manager were given all
   9     the delegated powers that they could be given. There
  10     were certain central services which would continue to be
  11     run from the centre. I think why it was thought to be
  12     able to work and why in practice it did work was, there
  13     was this clarity that people did not interfere with what
  14     a Clinical Director did within the limitations
  15     established for him; he was given his specialty, he was
  16     given the resource, he knew he had to comply with the
  17     instructions of the Trust; he knew he had to comply with
  18     the general NHS and national instructions. If you like
  19     to think there were limitations within which he had
  20     freedom of action.
  21   Q. I think Dr Roylance in his evidence referred to boxes
  22     and there being limits on boxes, which I think he said
  23     you drew up?
  24   A. That is the system I was trying to explain. I was
  25     trying to get clarity to people that rather than having

   1     a list of what you can do, you gave people freedom and
   2     said "Those are your constraints. Within those
   3     constraints, you have to feel free to do whatever you
   4     think best to ensure that high quality health care is
   5     provided to the large number of people you are
   6     contracted to look after".
   7   Q. Where did the strong leadership come from?
   8   A. I think it is strong leadership making sure that is
   9     defined clearly and making sure people took up and
  10     followed that and did not just do nothing.
  11   Q. If we just look on in this paragraph to the next
  12     paragraph down, do you see where it says:
  13        "The structure has been kept as flat as possible
  14     to keep Board members close to service provision. Board
  15     members will be actively encouraged to walk the job and
  16     give a clear personal lead to all managers and
  17     staff ..."
  18        What other role was there for the Board in
  19     providing leadership or direction to the Trust once the
  20     directorates had been established and the limits of the
  21     boxes, if you like, had been laid down?
  22   A. The Trust Board -- I think, if I may just go back to
  23     that paragraph you read, when we are talking Board
  24     members, I think there they are talking predominantly of
  25     the executive full-time Board members, not so much the

   1     non-executives. But the Board as a whole had the role
   2     of being aware of what was happening and having to make
   3     the decisions of where limited resource was to be
   4     applied and it also could be a facilitator of trying to
   5     help the clinical directorates as necessary. So the
   6     Board did not just set this up and go and do nothing; it
   7     was taking a very direct and clear interest in how they
   8     were succeeding.
   9        The clinical directorates developed at different
  10     speeds. It depended often not only on the personality
  11     of the Clinical Director and the NHS manager, but also
  12     on the attitudes of the key players in that
  13     directorate. The key players were usually the
  14     consultants. So the various parts were developing at
  15     different rates and the Board could assist those who
  16     were finding it difficult, by the General Manager going
  17     and talking if necessary with all the key players in
  18     that clinical directorate to hear what their problems
  19     and fears were, and try to see that they could be
  20     overcome so that directorate progressed more swiftly.
  21   Q. Can we just go to the bottom of that page, please?
  22        "The Trust's key objectives ..." the last line,
  23     "continue to improve our personal service with a total
  24     quality programme involving objectives for all managers
  25     and a staff training programme."

   1        Who would be responsible for setting managerial
   2     objectives?
   3   A. The managerial objectives would be at two levels. There
   4     would be those set by the Chief Executive, but you then
   5     move down one and you have the executive directors
   6     setting management objectives for things they were
   7     directly controlling, for example, the Finance Director
   8     would be worrying about his finance aspects, but
   9     otherwise, it would be in the clinical directorates that
  10     they would be laying down these objectives.
  11   Q. The Clinical Director would lay them down?
  12   A. Assisted by his manager.
  13   Q. But the objectives are for the Manager?
  14   A. Yes, and he would be agreeing with the Manager what it
  15     is he wanted him to do. But we are talking not only of
  16     one manager in the clinical directorate, we are talking
  17     of subsidiary managers as well.
  18   Q. Let us take the most important manager in the
  19     directorate, the General Manager of a directorate: their
  20     objectives would be set, therefore, by the Clinical
  21     Director in conversation with the General Manager,
  22     against a background of the ethos set by the Trust
  23     Board. Is that a fair summary?
  24   A. I am not sure. Why I am saying that is that I would not
  25     be directly involved in that process, so I am guessing

   1     exactly what the Chief Executive and the personal
   2     director and Clinical Directors decided they would do.
   3     They would be meeting monthly and I would expect them to
   4     be talking about this objective-setting at some of those
   5     monthly meetings.
   6   Q. So you cannot tell me exactly what went on, but that is
   7     what you would have expected?
   8   A. I would have expected that it was not done in isolation
   9     at Clinical Director level: there would be input
  10     certainly from personnel and probably from the Chief
  11     Executive as well.
  12   Q. So the key concept in the actual running of the Trust
  13     was the clinical directorate system?
  14   A. They were essentially -- yes. By having the clinical
  15     directorates, they were the people treating patients and
  16     providing the health care.
  17   Q. And the Clinical Director was given this new role as
  18     I think in your analogy, which Mr Wisheart says is
  19     a reasonable analogy, but like all analogies not
  20     perfect, they were the Chairmen of the directorate and
  21     the General Manager was the Chief Executive of the
  22     directorate?
  23   A. Yes.
  24   Q. So the leadership qualities of the Clinical Director,
  25     managerial and leadership qualities, would be very

   1     important to the success of a directorate?
   2   A. Correct.
   3   Q. How did the Trust satisfy itself that the Clinical
   4     Directors or assistant Clinical Directors had the
   5     necessary leadership as opposed to clinical qualities?
   6   A. The Chairman of the Hospital Medical Committee and the
   7     Medical Director, who quite often were the same person,
   8     and Dr Roylance as Chief Executive with his medical
   9     knowledge and background, knew well the strengths and
  10     weaknesses of the various consultants in all the
  11     specialties. It was important initially to try to
  12     ensure that the person who became the Clinical Director
  13     was somebody who was respected by his peers.
  14        You also try to ensure that that individual was
  15     also ready to be numerate and likely to be a good
  16     leader, so there were really three factors all
  17     interwoven in deciding who should the right person be.
  18   Q. That decision was Dr Roylance's decision?
  19   A. He made the final decision, but in fact again the
  20     process came about from a lot of talking and discussion
  21     with the people concerned who knew what was happening in
  22     that area.
  23   Q. Did you as Chairman or the non-Executive Directors have
  24     any role in the appointing of Clinical Directors, in the
  25     selection of them?

   1   A. No. I say "no"; as Chairman you are overall responsible
   2     for everything, but I do not remember -- I cannot recall
   3     now being involved in discussions, although I might have
   4     been. If there was a discussion about should it have
   5     been A or B in a certain specialty, I could have been
   6     brought in on that discussion informally, but I do not
   7     recall it.
   8   Q. To what extent is it fair to say that the Clinical
   9     Directors of the Trust in 1991 were all existing senior
  10     clinicians at the -- let us take the Bristol Royal
  11     Infirmary -- at the Bristol Royal Infirmary with whom
  12     Dr Roylance had worked closely for a number of years?
  13   A. The answer is, yes; because he had been there a long
  14     time, the answer to the second half is yes, too.
  15   Q. There was no Clinical Director who did not fall into
  16     that description?
  17   A. Not initially. I think it is worth enlarging why not.
  18     There was considerable suspicion among consultants in
  19     particular about the move to Trust status. I think they
  20     had some reason, because there had been very wild
  21     remarks being made politically about what might happen
  22     in Trusts and the freedom they might have.
  23        That being so, it was important to try to ensure
  24     that the Clinical Directors had the confidence of those
  25     working under them.

   1   Q. If we look at your Appendix C to your statement, you
   2     remember we looked at it very briefly, it is WIT 86/29.
   3        If we just look down the page, these particular
   4     matters requiring Trust Board approval, they include
   5     such matters as paragraph 9, "Major service changes",
   6     and 16, "Creation and terms of reference of Trust Board
   7     committees ..."
   8        If we go over the page to 31, these are the issues
   9     of which a Trust Board had to be informed. We see
  10     paragraph 5:
  11        "Appointment of Clinical Directors, senior
  12     managers and consultants."
  13        So those were not decisions taken by the Trust
  14     Board; they were decisions reported to the Trust Board?
  15   A. Correct.
  16   Q. That is what we have just been discussing.
  17   A. Yes.
  18   Q. Just while we are on that page, the Board would be
  19     informed of reports from standing advisory groups,
  20     paragraph 1; would be informed of Audit Committee
  21     reports and annual audit reports, paragraph 4; Trust
  22     Board committees and working papers, paragraphs 7; major
  23     PR issues, paragraph 10; and major operational matters,
  24     paragraph 12.
  25        What were "major operational matters"?

   1   A. An example would be if through illness in one of the
   2     hospitals a ward had to be closed because you could not
   3     provide the nursing staff. I would call that a major
   4     operational matter.
   5   Q. Any other examples?
   6   A. I cannot immediately think of them. I can spend time
   7     if you like and come up with some, but it was something
   8     that was stopping the delivery of high quality health
   9     care as planned.
  10   Q. Can we go back to 29, to the items, issues requiring
  11     Trust Board approval? The first is "Strategic
  12     plan - research and development plans and teaching and
  13     links with University."
  14        This was something that was touched upon with
  15     Dr Roylance; what was, as you saw it, the strategic
  16     planning role of the Trust Board?
  17   A. It was fully responsible for having, in the Trust,
  18     a strategic plan. Having said that, initially the
  19     freedom to have much action was very limited because you
  20     took on an inherited situation of what the resource was,
  21     what you had yourself as the provider, and also, there
  22     was additionally virtually no change in what the
  23     purchaser was wishing to have undertaken because the
  24     knowledge and evidence was not great and the purchaser
  25     had no additional resource.

   1        But within that, it was important to have a clear
   2     plan of where you saw the Trust as a whole moving, and
   3     I gave an example earlier of the decision taken about
   4     deciding that it was really going to commit its future
   5     capital for some years in a new building for the
   6     Children's Hospital.
   7   Q. We saw a moment ago -- I should have dealt with this
   8     then -- page 31, one of the issues which the Trust Board
   9     was to be informed of were major PR issues?
  10   A. Correct.
  11   Q. Would that include items hostile to the Trust published
  12     in Private Eye, for example?
  13   A. If it was thought that it was a major issue, yes.
  14   Q. Do you ever remember such items about UBHT in Private
  15     Eye being discussed by the Trust Board, formally or
  16     informally?
  17   A. I do not remember us formally talking about it. I do
  18     remember myself and some other members talking
  19     informally about the Private Eye articles. The
  20     conclusion that we came to, I understand, was that the
  21     doctors writing that were actually working in the BRI at
  22     the time, so it was understandable that their articles
  23     were more likely to be talking about the area which were
  24     working in and knew than an area somewhere else in the
  25     country.

   1   Q. What was the nature of the discussion that was had
   2     informally about Private Eye?
   3   A. I cannot recall in detail. In general, there was
   4     concern that there was a criticism of what standards we
   5     were trying to produce.
   6   Q. Was the source of those articles well known to the
   7     Board? Was it known where that information had come
   8     from?
   9   A. I was not aware of it, no.
  10   Q. But it was known that it must have been from inside the
  11     Bristol Royal Infirmary?
  12   A. Probably. That was the assumption that was made.
  13   Q. You say in your witness statement that the transition
  14     from the Health Authority to the Trust was smooth, at
  15     least in part because the executive directors of the
  16     Trust had been undertaking the same or similar roles
  17     previously under the Health Authority regime, for
  18     example Graham Nix or Mr Stone.
  19   A. Yes.
  20   Q. Mr Stone was the Personnel Director; Mr Nix was the
  21     Finance Director. Mr Boardman was responsible for
  22     development; Dr Roylance was the Chief Executive;
  23     Mrs Maisey had a new title: she was Director of
  24     Operations.
  25        What did you understand her role in the Trust to

   1     be?
   2   A. She was also the Senior Head of Nursing, but in the role
   3     you are talking about, Director of Operations.
   4        She was acting as, if I could use the phrase,
   5     really without direct authority but acting on behalf of
   6     John Roylance in trying to resolve day-to-day and
   7     perhaps week-to-week matters with the clinical
   8     directorates. If I call her a "staff officer", it might
   9     define the role she was doing. Although she did not
  10     have authority herself vested in her and people did not
  11     report through her, she was known to be acting on behalf
  12     of the Chief Executive.
  13        Having said that, if one of the Clinical Directors
  14     was unhappy if what she was saying, she could always say
  15     "I hear what you say but I want to get that from the
  16     Chief Executive himself", but her role was going round
  17     to try and resolve these issues which inevitably were
  18     occurring.
  19   Q. So it was known throughout the Trust that Mrs Maisey
  20     was, to put it in legal language, Dr Roylance's "agent"?
  21   A. I think I understand that in legal language. If I do,
  22     yes.
  23   Q. It might be more colloquially put in terms of her being
  24     Dr Roylance's "eyes and ears" throughout the Trust?
  25   A. Not only eyes and ears. She was also a doer.

   1   Q. When Mrs Maisey would express a view about a matter, the
   2     person to whom the view was expressed would believe or
   3     would understand that the view Mrs Maisey expressed was
   4     liable to be Dr Roylance's view also?
   5   A. That is right.
   6   Q. To what extent was this Director of Operations role
   7     compatible with the previous role of Nurse Adviser?
   8     What happened to the nursing adviser side of the Trust?
   9   A. May I just point out, before, when she was Nurse Adviser
  10     and continued to be Nurse Adviser, she was also one of
  11     the unit managers, so she was already undertaking a much
  12     more clearly defined operational role; if you drew it
  13     out, she actually appeared as one of the people to whom
  14     hospitals reported. So she was already undertaking both
  15     roles before and it really just continued.
  16   Q. Can we see UBHT 20/38, please? This is a document from
  17     February 1994. It is about management and culture. If
  18     we go to 346 --
  19   A. May I ask, I do not recognise what document this is. Is
  20     it a Board paper? What paper is this, please?
  21   Q. The reference I am looking for is not that, it is 346,
  22     please. [UBHT 20/346] It is an NHS publication from
  23     February 1994, so a little late in the time period, but
  24     it explains what is expected of Boards and Chairmen of
  25     NHS Trusts.

   1        I just want to explore with you to what extent
   2     what is said here was also applicable in 1991.
   3   A. Yes.
   4   Q. If we look at UBHT 20/346, Board of Directors,
   5     paragraph 5 first of all:
   6        "NHS Boards comprise Executive Board members and
   7     part-time non-executive Board members under a part-time
   8     Chairman appointed by the Secretary of State. There is
   9     a clear division of responsibility between the Chairman
  10     and the Chief Executive. The Chairman's role and Board
  11     functions are set out below. The Chief Executive is
  12     directly accountable to the Chairman and non-executive
  13     members of the Board for the operation of the
  14     organisation and for implementing the Board's
  15     decisions."
  16        So far that is a description of the position from
  17     the instigation of Trusts, is it not?
  18   A. Correct.
  19   Q. "Boards are required to meet regularly and to retain
  20     full and effective control over the organisation: the
  21     Chairman and non-executive Board members are responsible
  22     for monitoring the executive management of the
  23     organisation and are responsible to the Secretary of
  24     State for the discharge of these responsibilities."
  25        Again, that is a description of the position from

   1     the outside?
   2   A. Yes, I do not think it was written down, but certainly
   3     that is the role we saw ourselves having.
   4   Q. The mechanism by which you and your non-executive
   5     colleagues would monitor the executive management of the
   6     organisation was what?
   7   A. May I just finish reading that paragraph, please?
   8   Q. Yes, do. (Pause) The reason I stopped there was that
   9     it then goes on to the NHS Management Executive, and
  10     that was new.
  11   A. Yes, right. (Pause) We would see ourselves undertaking
  12     that role by the results that were reported to us when
  13     we met formally as a Board, by us observing, as we went
  14     around the Trust in between Board meetings. Those were
  15     our two key ways of understanding that what was being
  16     done was satisfactory.
  17   Q. So to the extent that the non-executive directors
  18     gathered their own intelligence about what was going on
  19     rather than relied on reports sent up to meetings --
  20   A. I explained that they would also get that, because they
  21     were chairing these various subcommittees of the Trust
  22     Board so they were seeing these people operate at that
  23     level; they were getting reports when we met monthly as
  24     a Trust Board and they saw these people operating around
  25     the table, because they were all equals once we sat

   1     around the table.
   2        So they had a very good feel for the individuals
   3     who were the executives.
   4   Q. Can we look down the page to paragraph 6? There are
   5     six key functions of Boards, five on this page and one
   6     over the page.
   7   A. Yes.
   8   Q. Perhaps you would have a look at those and tell me
   9     whether or not those were the six key functions from
  10     1991 and if not, what else there was. (Pause).
  11   A. May I see the last one?
  12   Q. Over the page, please, UBHT 20/347.
  13   A. May I go back, please? (Pause). I see those as what we
  14     were doing right from the start. When we talk about,
  15     I think at number 2, by "monitoring performance" we were
  16     looking at the number of patients treated; we were not
  17     looking at the clinical aspects of that at that stage.
  18   Q. It was numbers rather than outcome?
  19   A. It was not only numbers but how were they treated. We
  20     were very concerned at trying to improve the patient
  21     care; we were not, at that stage, looking at the
  22     clinical outcomes but we were very concerned about were
  23     they being properly looked after when they arrived at
  24     the hospital, et cetera, et cetera.
  25        So all of those were there. The phrases further

   1     down were not being used at the time, like "corporate
   2     governance", but we were concerned we should manage the
   3     organisation well and we tried to ensure that we looked
   4     after our staff.
   5   Q. So the language may have developed --
   6   A. But the concept I accept.
   7   Q. Mr Durie, I want to deal with the position in 1990,
   8     between the proposed Trust Board and the reaction of the
   9     Health Authority, but perhaps I can do that after
  10     a short break.
  11        Just before the break, may I deal with one small
  12     point that we can deal with fairly swiftly.
  13        Can we go to UBHT 38/280, please?
  14        This is a letter to Mrs Maisey dated 3rd June
  15     1991. If we go over the page, please, to 281, we will
  16     see it is signed by Dr Russell Rees, who was
  17     a cardiologist.
  18   A. Right.
  19   Q. If we go back to 280, the annotation at the top is
  20     yours, is it not?
  21   A. It is.
  22   Q. "To help with your review"?
  23   A. Yes.
  24   Q. It is stamped "Chairman's office", 4th June, 1991?
  25   A. Yes.

   1   Q. This is a letter about problems as Dr Rees saw them
   2     with cardiology at that time, and the time is two months
   3     into the life of the Trust?
   4   A. Yes.
   5   Q. May I just ask you to look at the first line:
   6        "Thank you for asking me to list the main problems
   7     with cardiology following our meeting with the
   8     Chairman."
   9        Do you remember having a meeting with Mrs Maisey
  10     and Dr Rees about this time?
  11   A. Until I saw this letter as a prompt, I do not. It was
  12     very likely, because when we became a Trust, individuals
  13     thought "Good, now we can try to get some of the
  14     problems that have been around for a long time
  15     resolved". I think from recall, my memory is not good,
  16     but I think his concern particularly at this stage --
  17     cardiology was in what is known as the "old" part of the
  18     BRI. In that part they also had the wards with people
  19     who had general medical problems, particularly chest
  20     problems. In the winter there was an enormous demand
  21     for beds if there was some form of epidemic. I have
  22     a feeling what he was wishing particularly was to have
  23     designated beds which could not be used by any other
  24     specialty. I think from memory that is what we were
  25     talking about.

   1   Q. Can we deal with the particulars of the letter? In
   2     paragraph 1, if we scan down a little, the last sentence
   3     of paragraph 1, "There is a need for protected beds to
   4     be allocated".
   5   A. Yes.
   6   Q. The annotation at the top, "Your review", "to help with
   7     your review": whose review? Mrs Maisey's review or
   8     somebody else's?
   9   A. This would be Mrs Maisey's review, either hers or
  10     John Roylance's. I cannot tell you which.
  11   Q. Was there a system of reviewing various areas of the
  12     Trust at this stage early in its life?
  13   A. As early as that, no, because people were still trying
  14     to see how the whole thing was working, but there were
  15     two ways problems arose. One, which I am guessing, was
  16     somebody who felt it was so pressing he wished to raise
  17     it and hoped a resolution would be found. In my
  18     statement I talk about another one to do with ITU where
  19     a consultant came to me with a problem. And there were
  20     others.
  21        But once the systems settled in, then, from
  22     recall, the Chief Executive and the Director of
  23     Operations, of probably Finance and probably Personnel,
  24     started carrying out Clinical Directorate visits to
  25     discuss with them where they were, what the problems

   1     were and what the future held.
   2   Q. So there was to that extent a formalised system of
   3     review or inspection of the directorates?
   4   A. Yes. But it would not have started as early as this.
   5   Q. Can we go over the page, please, to 281, paragraph 5?
   6        "Serious problems will appear if we successfully
   7     contract for more work and our bed state improves.
   8     There are deficiencies in the nursing and secretarial
   9     staffing which you know about... There are problems with
  10     junior medicine which sometimes leads to a less than
  11     adequate professional service."
  12        Picking it up at the end of the paragraph:
  13        "This lack of junior support for our Senior
  14     Registrars was severely criticised by the review body of
  15     the Royal College of Physicians at their last review
  16     when withdrawal of recognition was threatened if things
  17     were not improved.
  18        "These deficiencies are not new but have been
  19     highlighted by the worsening position which resulted
  20     from the rigid application of financial restrictions for
  21     the first time. Hitherto, overspending was one way of
  22     demonstrating the increased work in one's department".
  23        Overspending was no longer as readily available
  24     under the Trust system; is that right?
  25   A. Not only under the Trust system, but under the

   1     purchaser/provider system. That was the main key.
   2   Q. So what Dr Rees is saying is that the purchaser/provider
   3     system has highlighted the difficulties which existed
   4     for the cardiologists?
   5   A. Yes. May I just comment on your thing about the junior
   6     doctors? In fact although, as I say, we had Trust
   7     freedom, one thing we did not have freedom about was the
   8     number of junior doctors we could employ because as
   9     a teaching hospital we were the place where junior
  10     doctors did their apprenticeship as House Officers,
  11     Senior House Officers, Registrars, et cetera, but we
  12     were restricted -- I cannot remember the name of the
  13     organisation, but it was something called the Regional
  14     Medical Committee or some such organisation, which
  15     allocated to us how many of these people we could have.
  16        This certainly was a problem which frustrated us.
  17     We understood the limitations because this was
  18     nationally trying to ensure all the doctors got trained
  19     in the right places, but we did not have freedom of
  20     action. He talks about taking on locums, which was
  21     a fairly unsatisfactory way of trying to cope with that
  22     problem.
  23   Q. We know when you saw this letter you sent it to
  24     Mrs Maisey --
  25   A. Or Dr Roylance, I cannot remember which.

   1   Q. -- or Dr Roylance. It was addressed to Mrs Maisey so
   2     it was perhaps not necessary to send the letter to her,
   3     for a review. Do you remember having any involvement
   4     yourself further down the line with the problems Dr Rees
   5     explains?
   6   A. When the review was undertaken, had been completed,
   7     I would have been told of the results and it probably
   8     came to the Trust Board, I cannot remember. Out of
   9     courtesy I certainly would have gone and talked to this
  10     consultant, even if the answer had been that we could
  11     not help him.
  12   Q. How usual or unusual a plea was this from Dr Rees
  13     compared to the position of other specialties or other
  14     departments of the Trust?
  15   A. Every specialty, as I think I have indicated from the
  16     start about the different culture, believed they were
  17     under funded and they could not understand why, because
  18     their case was so strong, they were not given more
  19     funding. So it was very normal to have pleading from
  20     each specialty, a genuine pleading, "If only we had more
  21     resources we would be treating more people". What we
  22     had to point out was that the decision of how many
  23     people to treat was not ours any longer, it was that of
  24     the purchaser.
  25   MR MACLEAN: Sir, I think that may be a convenient moment.

   1     Before we do, Mr Durie, was it the committee you were
   2     mentioning a moment ago the Regional Manpower Committee?
   3   A. Probably.
   4   MR MACLEAN: I am grateful to Mr Brooke who reminds me of
   5     the title of that Committee.
   6        Sir, would that be a convenient moment for
   7     a break?
   8   THE CHAIRMAN: Yes, shall we adjourn now and reconvene at
   9     11 o'clock? Thank you very much.
  10   (10.50 am)
  11               (A short break)
  12   (11.05 am)
  13   MR MACLEAN: Mr Durie, can I ask you to look at
  14     HA(A) 142/49, please? At the top of the page, this is
  15     the District Health Authority agenda for April 23rd
  16     1990. You have ceased to be District Health Authority
  17     Chairman by this stage?
  18   A. Correct.
  19   Q. If we go to the foot of the page, we see in the
  20     paragraph beginning "The Authority's District General
  21     Manager. The second sentence:
  22        "The Authority therefore requires independent
  23     advice upon the merits and viability of this plan [the
  24     Trust plan] and its implications for service provision
  25     to the population for which the authority will in future

   1     have commissioning responsibility."
   2        So the Health Authority is doing its own
   3     investigation into the wisdom or otherwise of the Trust
   4     application.
   5        In due course, a report was produced and that is
   6     HA(A) 141/43.
   7        Do you remember seeing this report?
   8   A. No, I do not. I would be surprised if I would have seen
   9     it because at that stage I do not think I even had the
  10     formality of being called a "helper".
  11   Q. If we go to 53, the Review Committee interviewed all of
  12     these people: consultants first of all and then if we
  13     scan down the page, other medical nursing professional
  14     and so on.
  15        Over the page, "management et cetera". We see
  16     your name in the middle of that list. So you were
  17     interviewed by this Review Committee with a view to them
  18     producing their report?
  19   A. I do not recall the actual interview, but I am sure
  20     I was.
  21   Q. If we just go back to page 43, can you help us with who
  22     the members of the committee were: Mr Smith, Mr Deacon,
  23     Mr Keefe, Mr Mortimer and Professor Pickering.
  24        Mr Mortimer you told us was the Chairman of the
  25     Health Authority at one stage?

   1   A. Yes, he by this time was Health Authority Chairman.
   2   Q. Do you remember who the other people were?
   3   A. Yes, Mr Smith was a senior and long-standing member of
   4     the Health Authority. When, for various reasons,
   5     Mr Mortimer left the Health Authority, some time that
   6     summer, Mr Smith took over as Chairman.
   7   Q. So Mr Smith was the Chairman of the Health Authority for
   8     what, a matter of months?
   9   A. Yes. He was, I think, it is fair to call him
  10     a "stop-gap" replacement, but by this time it was
  11     fairly certain that the concept of purchaser/provider
  12     split and Trust was going to come into being.
  13   Q. But he did not stop a big gap if he was Chairman for two
  14     or three months?
  15   A. Yes.
  16   Q. So was his departure planned or unplanned?
  17   A. Mr Mortimer's? I was not directly involved with it so
  18     it was hearsay. His departure was on his part clearly
  19     unplanned. I mentioned earlier he was vehemently
  20     opposed to the concept of Trusts. There was clear
  21     thought among the Authority members that he was actually
  22     being destructive in what he was trying to achieve.
  23     I believe they had a special meeting of their own Health
  24     Authority where they showed no confidence in having him
  25     as Chairman and I believe that was reported to the

   1     Regional Chairman and soon after that he left.
   2   Q. You would not have been involved in that?
   3   A. I was no part of any of that.
   4   Q. If we scan down to 1.3, the committee were advised by
   5     three officers. Each of these officers had all worked
   6     for the Bristol & Weston Health Authority for some time,
   7     had they not?
   8   A. I am not sure how long Miss Evans had been there, but
   9     the other two, yes. But they all had worked for it.
  10   Q. I think Miss Evans is giving evidence to the Inquiry on
  11     Monday. Dr Baker and Mr Parr?
  12   A. Were long-term.
  13   Q. Then we see, at paragraph 1.4, what the Committee did.
  14     We do not need to dwell on that. Can we go to page 44:
  15        "3.1 The sponsors' case": that is the case for
  16     the Trust, is it not?
  17   A. Yes.
  18   Q. Then 3.2:
  19        "The sponsors did not see the prospective freedoms
  20     allowed to NHS Trusts as a principal reason for the
  21     application. The main emphasis was placed on the
  22     resulting independent position in dealing with the
  23     future purchasers and on the supportive function of the
  24     non-executives in this. This separation was seen by
  25     them as effectively insulating the provider unit from

   1     the pressure for delivery of quantity of care in the NHS
   2     which would fall in future on the purchasers alone
   3     whilst leaving the Trust scope to concentrate
   4     managerially and professionally on their own
   5     requirements for quality of service. The sponsors
   6     argued that because of ultimate managerial control,
   7     a directly managed unit would be susceptible to pressure
   8     on the quantity-versus-quality balance, which a Trust
   9     would not."
  10        That is essentially what you were telling us
  11     before the break?
  12   A. Yes, it is. If I can reiterate, there really was
  13     a real concern at the time. The pressure on the
  14     purchaser from the centre to try to ensure that there
  15     were not long waiting lists, et cetera. We tried to get
  16     them to make the provider increase the numbers, even if
  17     that increase in numbers meant a drop in the quality of
  18     care.
  19        As a Trust, we wanted to make certain that we were
  20     separate and independent and could resist action that
  21     would make us lower our quality of care.
  22   Q. One of the concepts inherent in the NHS reforms was that
  23     Trusts or directly managed units would effectively be in
  24     competition one with the other in the provision of
  25     health care; is that right?

   1   A. That is correct.
   2   Q. To what extent was the UBHT actually going to be in
   3     competition with another provider for the provision of
   4     health care?
   5   A. It was recognised that certainly in the early years
   6     there would be very little competition and that would
   7     not come about because the knowledge was so limited
   8     about what anything cost, because hitherto there had not
   9     been an interest in what anything cost. So it tended to
  10     be the purchaser saying to the hospitals which were
  11     already giving it its provision, "Please, we want you to
  12     do the same as last year plus a little more, and that is
  13     the sum of money which you had last year and we will
  14     allow for inflation and that is what you will have". So
  15     I am trying to paint a picture of in reality very little
  16     competition as a start.
  17        As it developed and there was clarity on pricing,
  18     one did expect the purchaser to be able to look and make
  19     certain there was value for money. They could well do
  20     it by going to the provider and saying "Are you aware
  21     you are asking us to pay X plus something where
  22     elsewhere we only have to pay X?" So the competition
  23     was not a reality in the early parts of the split of
  24     purchaser/provider.
  25   Q. And that is the point made at the very end of

   1     paragraph 3.3?
   2   A. Yes.
   3   Q. If we go over the page to 45, the top of the page, the
   4     second line:
   5        " ... the meetings with the sponsors left the
   6     committee with concerns on three main subjects: the
   7     team's concept of the Trust as a mechanism for
   8     insulating the provider unit from the pressures of
   9     service volume demand, leaving this as a problem for the
  10     purchaser and by implication the region and the
  11     government", so that is a concern internal to the Health
  12     Authority?
  13   A. Yes.
  14   Q. Secondly, "The prospective Trust's apparently very
  15     reactive strategic approach based simply on responding
  16     to purchaser requirements when identified. This
  17     corresponds to comment in the scrutiny document about
  18     lack of a clear market analysis, business position or
  19     corporate and service development strategy.
  20        Thirdly, "The team's defensive attitude to the
  21     apparent lack of support for their Trust proposal
  22     coupled with an unwillingness to accept a link between
  23     their ability to achieve such support and the
  24     appropriateness of proceeding with the application at
  25     the present time."

   1        How would you react to the second and third of
   2     those comments?
   3   A. I think that there was an unrealistic belief that
   4     somehow you produced -- if I go back to business --
   5     a full business plan, deciding which sector of the
   6     market you were going to determine to enter, et cetera,
   7     et cetera. That was not reality. As I tried to
   8     explain, the reality was that you were already providing
   9     a service and the purchasers would need to continue to
  10     ask you to do so for some time, until there was greater
  11     clarity of what were the options for the purchaser from
  12     elsewhere.
  13        So the opportunity for change was really at the
  14     margins rather than suddenly deciding that as a new
  15     Trust, we would do nothing but psychiatry. That would
  16     be quite a stupid situation to consider. Therefore,
  17     I believe that the Trust application was being pragmatic
  18     and the people commenting were actually probably not --
  19     were hoping there was greater freedom than in reality
  20     existed.
  21        Dealing with the last one: this was a problem. As
  22     I think I mentioned earlier, there was considerable
  23     concern by doctors in particular that somehow the
  24     creation of Trusts was going to break up the NHS. Those
  25     of us who were putting in the application were

   1     absolutely convinced that was not so. We were totally
   2     committed to the National Health Service and still are,
   3     and did not see that this put the NHS at risk at all.
   4     We believed that over the months we would be able to
   5     persuade sufficient people that the risk they saw did
   6     not exist.
   7   Q. If we look at 4.2, down the page, please:
   8        "In January 1990 consultant medical staff, so the
   9     senior medical staff, had balloted and the question was,
  10     with the present information, "Do you support any
  11     attempts to convert your hospitals into the whole or
  12     part of a self-governing Trust or Trusts?"
  13        The turnout was rather better than the European
  14     elections and 81 per cent of those who voted, voted no.
  15     That was not an isolated view, was it? If we look at
  16     UBHT 74/266, this is October 1990. This is the
  17     Electoral Reform Society. If we just scan down the page
  18     to senior medical and dental staff, and they voted by
  19     the barest of majorities, 66 to 65, against there being
  20     an NHS Trust.
  21        If we look at UBHT 74/253, the foot of the page,
  22     if we go over to 54 at the top -- I am sorry the bottom
  23     of this page -- "ballot of all medical staff employed by
  24     the Bristol Royal Infirmary, in the Bristol sector,
  25     a 20 per cent response, 80 per cent against, and if we

   1     go over the page, 255, staff ballot, a bigger majority
   2     against: 84 to 16 per cent.
   3        So there was a clear pattern of opposition to the
   4     Trusts from the medical staff as a whole and, albeit
   5     narrowly, by October 1990 from the more senior medical
   6     staff.
   7        How did those proposing the Trust react to that
   8     expression of view?
   9   A. We were clear that there was no intention of reducing
  10     the conditions of service for those working in the
  11     Trust. I am sure that was the reason why the staff
  12     ballot was showing this figure. There was a repeat --
  13     I think I said earlier in the papers there was a lot of
  14     very wild statements about the freedom of Trusts and
  15     what the Trusts would do. There was comment about
  16     Trusts would cut the amount of money paid to nurses and
  17     everybody else. I already mentioned that we decided
  18     that we would certainly continue as existed with the
  19     system, and we had no intention of trying to get health
  20     on the cheap.
  21        Doctors, again, they are very busy people. Their
  22     main concern is treating patients. They were not
  23     involved or wishing to be greatly involved in the real
  24     pros and cons, and if they were reacting to what they
  25     read in the press, I am not surprised if they were

   1     coming out against it.
   2   Q. If we go back, please, to HA(A) 141 at 48, at the top of
   3     the page -- if we just go back one page to get the
   4     context of it, to page 47, under the heading "Clinical
   5     Directorates" at the foot of the page:
   6        "Likewise, prospective incumbents have yet to be
   7     identified for certain key director posts. Provision of
   8     clinical time remains to be agreed and most of the
   9     methodology of practical working of the concept has yet
  10     to be defined or tried out locally. Whilst it is hoped
  11     that the system will be able to commence by April 1991,
  12     it is bound to take time to become effective,
  13     particularly in view of the rate of progress in
  14     localities with longer experience. Proven clinical
  15     involvement in management and control of budgets ... is
  16     therefore unlikely to be available for a Bristol Trust
  17     application until ... 1992 at the earliest."
  18        Was it right that there was very limited, perhaps
  19     even no substantial proven clinical involvement in
  20     management at that stage of those who were going to
  21     assume these Clinical Director posts?
  22   A. Before I answer that, I do not know what this document
  23     is.
  24   Q. It is the same report, July 1991.
  25   A. It varied across the different specialties. In some

   1     cases -- we have to go back one.
   2        The concept of having Clinical Directors was being
   3     talked about while we were still a Health Authority. If
   4     we remained a Health Authority and did not become
   5     a Trust -- and I do keep on emphasising, becoming
   6     a Trust was not the most important aspect, it was the
   7     purchaser/provider split, but if we had remained what
   8     was known as a "directly managed unit" we would still
   9     have wished to introduce clinical directorates.
  10     Therefore it varied in different parts of the Trust as
  11     to how well-established clinicians were in coping with
  12     the overall financial control.
  13        If they were inexperienced, that was where you had
  14     the Director of Operations able to give a hand in the
  15     initial stages and they also had the NHS manager and you
  16     had people coming from the finance office to help them.
  17     So it was supportive where you had somebody who might be
  18     concerned about their ability to cope.
  19   Q. This Health Authority report concludes at page 52, if we
  20     just go to that, paragraphs 12 and 13 -- 13 first of
  21     all, unanimously that it has, at 12.1(1), serious
  22     reservations about the application for Trust status of
  23     the Bristol Provider Unit.
  24        There was a subsequent report, was there not, if
  25     we go to UBHT 74/253, this is the one that includes some

   1     of those ballot results we were looking at a moment ago.
   2        If we go to 256, "Conclusions", if we just take
   3     a moment to look at those conclusions, perhaps you could
   4     just see the rest of the page.
   5        Can we go over the page once you have got to the
   6     bottom?
   7   A. I am happy with that, thank you.
   8   Q. This is October 1990, so three months later, and there
   9     seems to have been rather a volte-face by the Health
  10     Authority. I know you were not the Chairman of the
  11     Health Authority, but you were involved in the Trust
  12     applications so this must have been music to your ears,
  13     this report.
  14        Can you account for the change of view of the
  15     Health Authority over that three-month period?
  16   A. I cannot remember exactly when Mr Mortimer left and
  17     Mr Smith became the Chairman, but I think that was the
  18     main reason.
  19   Q. Do these initials "DS/MDB" mean anything to you?
  20   A. This would be Derek Smith who became Chairman.
  21   Q. He replaced Mr Mortimer?
  22   A. He did.
  23   Q. Mr Mortimer had nothing else to do with it?
  24   A. He left the Health Service.
  25   Q. So you would attribute the change in tone in these two

   1     reports to the change in Chairman?
   2   A. That would be the major factor. There would be an
   3     increasing understanding of what were the benefits of
   4     becoming a Trust and these were being accepted by the
   5     members of the existing Health Authority.
   6   Q. At all events, the Trust was set up. Can we go to
   7     UBHT 23/603, to the inaugural meeting of the Board on
   8     2nd January 1991. This is a little while before the
   9     Trust went live, but it had been formally established.
  10        Can you help, we know about those on the
  11     right-hand side, I think. Can you help us with the
  12     non-executive directors? First of all, how were they
  13     appointed?
  14   A. The University man, Professor Pickering, I believe it
  15     was the University who could say he was to be their
  16     representative. Whether they had to get that signed off
  17     by Region I do not know, but certainly, that is
  18     Professor Pickering.
  19        He had been the Dean of the Faculty of Medicine,
  20     so he was a very appropriate individual to have as
  21     a non-executive.
  22        The other four were names that I had put forward.
  23     Two of them were existing Health Authority members:
  24     Mrs Cox and Mr Harrisson. The other two had not been
  25     involved in the Health Service before, Mr Sherwood and

   1     Mr Woolley and those names had to go to region for them
   2     to give it approval. I think they were actually
   3     appointed even then formally by the Minister of Health.
   4     Certainly, it was not in my gift to appoint them.
   5   Q. They had come from an industrial background?
   6   A. If I can run through the four, Mrs Cox was a nurse and
   7     midwife. Mr Harrisson was a businessman who had been
   8     much involved in -- some of his activities included
   9     property and he helped greatly in looking after what we
  10     call the "commercial services" aspect of the Health
  11     Authority when it existed and now to be the Trust.
  12        The two newcomers, Mr Sherwood and Mr Woolley,
  13     were both senior and experienced businessmen.
  14   Q. How did you come to suggest their names as opposed to
  15     the names of others?
  16   A. I was clear as Chairman -- hopefully Chairman -- of this
  17     Trust-to-be that we required people who could give their
  18     independent view about how we were running ourselves,
  19     how things were being done. They were not going to be
  20     frightened by the size of the organisation and they were
  21     clear about certain aspects. Mr Sherwood had come,
  22     amongst other things, from a background of customer
  23     service, so he was going to be good on that aspect of
  24     looking after and improving our patient care.
  25     Mr Woolley had come from a big organisation and he was

   1     going to be helpful when we were worried about personnel
   2     matters. I knew both of them, but did not know them
   3     well.
   4   Q. From business or personally?
   5   A. I knew them from being around in Bristol. I had never
   6     done business with them.
   7   Q. Did you play golf with them? How did you know them?
   8   A. No, I knew them because I had been working in Bristol
   9     since 1969, although much of that time perhaps in
  10     London. I had always kept my base here, and over those
  11     years, involvement not only more recently with the
  12     Health Service but before that with other events in
  13     Bristol, I had got to know people round about and I knew
  14     of the reputations of both these individuals as very
  15     effective businessmen.
  16   Q. Did Mr Sherwood and Mr Woolley know each other when
  17     you --
  18   A. I do not think they did. I do not think they did.
  19   Q. Do you know if either of them were members of any
  20     Masonic lodge?
  21   A. I do not, but I would be surprised -- I do not, and
  22     I would be surprised if they were.
  23   Q. Were you?
  24   A. No.
  25   Q. Have you ever been a member of any Masonic lodge?

   1   A. No.
   2   Q. What about the other two, Mr Harrisson and Professor
   3     Pickering?
   4   A. I have never asked them directly, but I am not aware
   5     of them ever being.
   6   Q. We can probably leave Mrs Cox out of it. If we go to
   7     the bottom of this page, please, Mr Durie, the Chairman
   8     and non-executive directors went into a huddle, formed
   9     a Committee, and to appoint the Chief Executive?
  10   A. Yes.
  11   Q. But this was of course purely a matter of form, was it
  12     not? Everybody knew that Dr Roylance was going to be
  13     the Chief Executive of the Trust?
  14   A. Yes, he was. It was formalising the situation.
  15   Q. And it meant that from then on Dr Roylance could be paid
  16     as Chief Executive of the Trust?
  17   A. Yes.
  18   Q. So he was offered the job and to no-one's great
  19     surprise, he accepted. Then, if we go over the page,
  20     605, he was appointed from 1st April 1991. You see then
  21     there was a discussion of the appointment of the other
  22     executive directors. Four of them were statutory: the
  23     Chief Executive Officer, Director of Finance, a medical
  24     practitioner and a nurse. This was Dr Roylance, Mr Nix,
  25     the Chairman of the Hospital Medical Committee, Mr Dean

   1     Hart and Mrs Maisey, because Mrs Maisey was a nurse?
   2   A. Right.
   3   Q. The Trust Board met monthly, did it?
   4   A. Yes.
   5   Q. And in-between the meetings of the Trust Board, there
   6     was a meeting of something called the Executive
   7     Committee?
   8   A. I think there is a danger of confusing the titles. We
   9     met as a Trust Board monthly. Some months we were
  10     called an Executive Committee, not a Board, but our
  11     responsibilities of authority did not change.
  12        In addition to that, the Chief Executive had
  13     a monthly meeting about halfway through where he met up
  14     with the Clinical Directors. I think initially he had
  15     both Clinical Directors and General Managers there.
  16   Q. Was that a meeting known as the Group of Executives?
  17   A. No, the Group of Executives was a much smaller group.
  18     The Group of Executives would have been those
  19     appointments we are talking about there plus one or two
  20     more like the IT man and the PR person, so it would be
  21     the Finance Medical Director, Director of Personnel,
  22     Corporate Planning.
  23   Q. Can we go to UBHT 34/229? This is a meeting of the
  24     Executive Committee, as it is called, on 19th June
  25     1992. It is attended by the executive and the

   1     non-executive directors, and you are in the chair?
   2   A. Yes.
   3   Q. If we go down the page, please, to number 2, under
   4     "Your remarks", Professor Angelini had been appointed
   5     and Mr Wisheart felt he would make an immense
   6     contribution to the work of the Trust.
   7        Can you help as to the role of Professor Angelini
   8     and the extent to which you had been involved in
   9     interviewing other candidates for that job?
  10   A. Where it was a Professor that was being appointed the
  11     appointment committee was the University and not, in the
  12     old days, the Health Authority and now the Trust Board.
  13        The University called for one or two
  14     representatives from UBHT and they also had lay members
  15     of the University Council sitting on the appointment
  16     committee.
  17        I happened also to be a lay member of the
  18     University Council, so normally, if it was a Professor,
  19     a clinical Professor being appointed, I would find
  20     myself being nominated as one of the two lay members to
  21     attend.
  22        On this occasion I did attend and it was normal
  23     for the people who were serious candidates to come and
  24     talk around, including talking to myself in the role as
  25     Chairman of the Trust, because although they were being

   1     employed by the University, they were also fulfilling
   2     a clinical role, and the Trust had the greatest
   3     influence on that clinical role.
   4   Q. Can we go to JDW 3/102, and just scan down the page.
   5     This is a letter from Mr Martin Elliott. Looking over
   6     the page, we will see that.
   7        He is explaining to Mr Wisheart why he is not
   8     intending to put himself forward for the job.
   9        You had met Mr Elliott about this, had you not?
  10   A. I think so. I am sorry, my memory is not perfectly
  11     clear, but I would expect to. If he was a serious
  12     candidate, I would have thought he would come and see
  13     me.
  14   Q. If we go to JDW 3/106, if we go, please, to the foot
  15     of the page and over to 107 and then 108:
  16        "Paediatric cardiac surgical services should be
  17     moved to the Children's Hospital". This is under the
  18     heading "Conclusions":
  19        "I believe this is fundamental to the whole
  20     appointment of a Chair of Cardiac Surgery, particularly
  21     for a paediatric-based Professor. The freeing up of
  22     resources at the BRI need not simply be limited to an
  23     increase in number of patients put through, but would of
  24     course expand the research potential. There should be
  25     the possibility of importing patients from surrounding

   1     regions or abroad, given the new capacity ..."
   2        If we go over the page again, to the end of the
   3     document on page 110 -- we are not going to get to the
   4     end of it, it does not matter. It is the passage at 108
   5     that matters.
   6   A. I am not sure what document this is.
   7   Q. I am just trying to get to the end. It comes from
   8     Mr Elliott. If we go back to page 102, please, that is
   9     the letter that we looked at a moment ago. At the end
  10     of the letter is 103. If we go to 104, attached to the
  11     letter was this document which was Mr Elliott's view of
  12     the position prior to the writing of the letter to
  13     Mr Wisheart at 102 and 103.
  14        What we looked at was Mr Elliott's own document.
  15   A. Yes.
  16   Q. As you see from the second paragraph on that page, it is
  17     his thoughts "gleaned as a result of a single visit to
  18     Bristol and a consideration of some of the aspects of
  19     the appointment."
  20        Do you remember talking to Mr Elliott, or indeed
  21     Professor Angelini, before this appointment was made?
  22   A. As I said, it would be very normal. I cannot recall
  23     the details of the conversations.
  24   Q. One of the three reasons given in the letter at 102 by
  25     Mr Elliott for not taking the job is the split site.

   1     How big an issue was the split site for you in 1991/92?
   2   A. It was not a big issue for me because it was not
   3     unique. In Bristol quite a lot of the specialties for
   4     paediatrics were not happening in the Children's
   5     Hospital. Just to name a few, within the UBHT there was
   6     ENT happening in a general hospital; ophthalmology
   7     happened in the Eye Hospital. Trauma in fact still
   8     happens in the BRI. So from our point of view, not
   9     everything being in one site was not surprising, and
  10     just in Bristol alone, you then had Southmead dealing
  11     with all the paediatric nephrology and Frenchay dealing
  12     with all the paediatric neurosurgery and medicine, so it
  13     did not come to me as a very high worry or high
  14     priority.
  15   Q. You say in your statement it has never been suggested
  16     that the split site was having an adverse effect on
  17     surgical outcomes, so far as you were aware.
  18   A. That is correct.
  19   Q. Were you aware of a paper by Dr Jordan written in 1990
  20     which was mentioned in evidence to Mr Nix, which I think
  21     is at UBHT 159/44?
  22        Did you ever see this document?
  23   A. No. I would be surprised if I had, because that was
  24     very much during the period when I was "out in the
  25     wilderness".

   1   Q. And you did not see it subsequently when you returned
   2     from the "wilderness"?
   3   A. I do not recall so.
   4   Q. Can we go back to the Trust meeting we were looking at,
   5     UBHT 34/229? This is the one where you reported on the
   6     appointment of Professor Angelini. Can we go to 230 at
   7     the bottom of the page? In Dr Roylance's report, the
   8     penultimate paragraph:
   9        "Management changes ..."
  10        Mr Boardman had departed. Kathy Orchard would be
  11     deputy to Mrs Margaret Maisey and Clive Baish would
  12     assume the planning aspects of Mr Boardman's job.
  13        Mr Boardman had been an executive director of the
  14     trust; he had been a non-voting director of the Trust.
  15     What were the circumstances of his leaving in 1992?
  16   A. My recall is that he did it specifically to improve and
  17     move on and get a career change which was to him
  18     advantageous. He felt quite strongly that we decided
  19     that it was personnel who should be the full executive
  20     Board member, and although we treated him as one, he
  21     actually knew he was not a Board member and on his CV
  22     et cetera that did not show as a Trust Board member.
  23        So I think he was doing this, understandably and
  24     in my view rightly, for his own advancement.
  25   Q. So he felt a bit peeved that he had not been made the

   1     full Board member?
   2   A. I think he saw what he was doing as so important he
   3     could not understand why he had not been made a Board
   4     member. Our decision was that personnel in these early
   5     years of the Trust mattered more.
   6   Q. Did you get the impression that he bore a grudge against
   7     you and Dr Roylance because of that?
   8   A. I do not know.
   9   Q. You think he might have done?
  10   A. He could have, for that. People understandably get very
  11     committed to what they are doing. He obviously saw his
  12     role as strategic planning as so important he could not
  13     understand why he was not a Board member. We made the
  14     decision we could only appoint one and we decided as
  15     I said already that personnel was more important.
  16   Q. So how important was the role of strategic planning?
  17   A. I think I tried to explain earlier, initially we did
  18     not see that there was enormous scope for great in-depth
  19     strategic planning because the reality was that the
  20     purchasers could only buy that which they tended to have
  21     done before. You could do fringe developments of
  22     specialties, but there was, as I said, as you might have
  23     in a business company where you decided you would enter
  24     a whole new sector of the market, we did not see that as
  25     realistic.

   1   Q. If we go to 231, still in the same meeting, still in
   2     June 1992, if we scan down the page, please, under the
   3     heading "Matters arising", Mr Woolley, one of the
   4     non-executives, "raised the matter of medical audit.
   5     Mr Wisheart said that this matter was being discussed.
   6     In relation to ENT surgery, medical audit was only
   7     a small contributor to their problems of meeting these
   8     contracts. Mr Durie asked Mr Wisheart to further this
   9     discussion and to refer to the Board if necessary."
  10        The action is "JDW": Mr Wisheart?
  11   A. Yes.
  12   Q. That would appear, would it, as if Mr Wisheart's
  13     instruction from you was to take the matter forward and
  14     to deal with it himself, and only to bring it back to
  15     the Board if it was necessary to do so.
  16   A. That is correct.
  17   Q. And that would be consistent, would it, with the
  18     philosophy of the Trust which was that problems should
  19     be solved at as low a level as possible and not brought
  20     up the chain unless necessary?
  21   A. That is so.
  22   Q. So Mr Wisheart was the man who was at this stage
  23     concerned with taking forward the medical audit concerns
  24     raised by Mr Woolley?
  25   A. Yes.

   1   Q. But we know that one of the matters which the Trust
   2     Board had to be informed about under the standing
   3     orders -- Appendix D of your statement -- was Audit
   4     Committee reports, annual audit reports and the audit
   5     programme.
   6        In this paragraph it would tend to suggest that
   7     the matter was not necessarily going to come back to the
   8     Trust Board at all.
   9   A. Soon after the Trust started -- I cannot tell you
  10     exactly when -- the whole concept of clinical audit was
  11     being introduced and we were given the task, "we" being
  12     the Trust and other Trusts, of ensuring the facilities
  13     for that audit were in place. Those facilities ensured
  14     that there was time on people's programme and there was
  15     some resource allocated, and there should be a proper
  16     Trust Audit Committee set up to ensure the audit took
  17     place and begin to deal with the outcome.
  18        All of that we did, and I do recall on one
  19     occasion, I cannot tell you how often, that we received
  20     the annual report from this Trust Audit Committee, whose
  21     Chairman was a Dr Thomas, who had been a previous
  22     Hospital Medical Committee Chairman, so we appointed him
  23     in order to give this new committee a standing.
  24   Q. So do you remember the discussion we had at the
  25     beginning between the "strong leadership" and the

   1     "maximum delegation"?
   2   A. I do.
   3   Q. This would be an example of the maximum delegation
   4     taking place in terms of audit?
   5   A. I do not interpret it as that. Mr Wisheart was
   6     a very conscientious and capable clinician and if, when
   7     he started looking at what appeared to be concern about
   8     outcome on ENT surgery, there was anything that he
   9     believed the board should know about, he would have
  10     brought it to us, I am sure.
  11   Q. And the same would apply to any other area of the
  12     hospital's activities?
  13   A. Yes, it would. I do have to reiterate about the culture
  14     of that time. The culture was not at that time for
  15     clinical outcome to be brought back by doctors to
  16     management.
  17   Q. Can we go to UBHT 6/126? This is a meeting of --
  18     I think this is the Trust Board. It is the same people
  19     as you mentioned who attended the Executive Committee.
  20     If we look down the page, please, "Chairman's remarks",
  21     the second paragraph:
  22        "UBHT had now completed two successful years as
  23     a Trust with more patients treated above target and
  24     within budget. Many new treatments had been
  25     undertaken -- for example, 'keyhole' surgery -- but the

   1     most important development had been that of doctors and
   2     Clinical Directors and sisters managing their own ward
   3     budgets. Becoming a Trust had given freedom from
   4     bureaucracy, but UBHT was still very much part of the
   5     Health Service. That freedom had allowed patients to be
   6     treated more effectively than ever before.
   7        "However, within the purchaser/provider split,
   8     resources were limited and choices had to be made, and
   9     this was a matter which was coming into public
  10     debate ..."
  11        I think we may have touched on this earlier, but
  12     the actual bureaucracy that, let us say, the system or
  13     the nurse on the ward would have noticed he or she had
  14     been freed from would have been what?
  15   A. I do not think I can answer that. I just do not have
  16     the knowledge.
  17   Q. What about the general manager of the Clinical
  18     Directorate who had previously been a manager in the
  19     Health Authority: what bureaucracy would they have
  20     noticed themselves having been freed from two years into
  21     the Trust?
  22   A. I think, as I said earlier, they would have found that
  23     there was much less routine form-filling and returns
  24     than there had been hitherto. They would also have
  25     found that they had, as long as they kept within the

   1     resources, particularly financial resources allocated to
   2     them, they had freedom to appoint whatever mix they
   3     thought was best for providing the best health care.
   4     They might decide it was more important to have
   5     a further physiotherapist rather than some other
   6     specialty.
   7        So they had this freedom which hitherto they
   8     did not have.
   9   Q. One of the freedoms which Trusts were in theory given
  10     was the freedom to vary pay and conditions locally?
  11   A. Yes.
  12   Q. If we go in the same document to 132, at the bottom of
  13     the page, in fact, as Mr Stone reported, the UBHT had
  14     remained within the national pay systems.
  15        So that particular freedom was one which the Trust
  16     had not exercised, no doubt for political (with a small
  17     "p") reasons?
  18   A. Yes. I mean, we consciously took that decision. We did
  19     not wish, as I think I said earlier, to try to use
  20     independence as a means of getting people to work for
  21     less money.
  22   Q. Can we see another meeting: UBHT 6/200? This is May
  23     1993. We see there, Meeting of the Executive Committee,
  24     the same people again. Page 202, towards the bottom of
  25     the page, the penultimate paragraph:

   1        "Dr Roylance said that UBHT had delegated
   2     responsibility to operational level and had pursued
   3     a policy of management by values and not by objectives.
   4     For this style to achieve continued success, the Trust
   5     Board needed to reinforce its values. Dr Roylance asked
   6     the Board to reflect what values should explicitly be
   7     presented to the workforce."
   8        What does that mean? What were the values and
   9     how does one manage by values in contradistinction to
  10     managing by objectives?
  11   A. I find it difficult to answer that, because I think it
  12     was a concept he was expounding. I cannot recall at
  13     this stage all of the argument he put forward. I think
  14     the minute was just a resume of quite a long discussion,
  15     so I am not going to be very helpful in reply to this.
  16     I see that whether you call a thing an "objective" or
  17     a "value", quite often it is the same situation.
  18     I think he was trying to get away from prescriptive
  19     lists, saying "I have done that, I need not do any
  20     more", to trying to get people to see themselves as
  21     given facilities and within the direction trying to
  22     ensure that they did the very best that they could for
  23     both volume and quality of patient care.
  24   Q. Can we look at UBHT 7/166? This is 17th December
  25     1993; the Executive Committee again.

   1        If we look down the page, please, the roles of the
   2     Medical Director and the Chairman of HMC:
   3        "Mr Durie thanked Mr Wisheart for having
   4     carried the burden of the dual roles.
   5        Mr Wisheart was to remain Medical Director but
   6     Dr Laszlo was to be the Chairman of the HMC from April
   7     1994.
   8        What burden did you perceive these dual roles of
   9     HMC Chairman and Medical Director to have placed on
  10     Mr Wisheart since 1991?
  11   A. The burdens had been considerable and we believed in the
  12     sort of evolution at that stage that it was right to
  13     start pulling the two apart.
  14        I have to go back to why we were keen initially
  15     and include not only for the first year but also for the
  16     next two years, the first year being somebody called
  17     Mr Dean Hart and the second year being Mr Wisheart, to
  18     have the Chairman of the HMC also the Medical Director
  19     was -- you talked earlier about the concern of
  20     consultants about whether Trusts were or were not a safe
  21     place to work and by having their own chosen
  22     representative as the Medical Director gave considerable
  23     reassurance.
  24   Q. You used the expression "we" in that answer. Who was
  25     the "we"?

   1   A. I think "we" would have been really myself and
   2     Dr Roylance, and the non-executive directors.
   3   Q. Was the burden on Mr Wisheart as Medical Director and
   4     Chairman of the HMC an intolerable one by this time in
   5     your opinion?
   6   A. I did not have the opinion it was. I believe if it had
   7     become intolerable, he would have come and told me,
   8     because he was a man of considerable stature and he
   9     would not have wished to be undertaking a task which he
  10     could not do properly. It is I think also relevant that
  11     because the Chief Executive was himself a doctor, and
  12     recently a consultant in this setting, he knew a lot of
  13     what was happening medically and therefore it did not
  14     always fall on the Medical Director to have to give
  15     medical advice because Dr Roylance was able to brief
  16     myself or other people about the medical implications.
  17   Q. Were you aware of how many sessions a week the Medical
  18     Director, Mr Dean Hart and then Mr Wisheart, spent --
  19   A. They had, I think, a statutory two sessions a week in
  20     their role as Medical Director.
  21   Q. Can we look at UBHT 20/7, please? These are the
  22     minutes of the meeting of 14th January, so the following
  23     month from the one we have just looked at. Under
  24     "Chairman's remarks", first paragraph:
  25        "The Chairman also welcomed Dr Gabriel Laszlo who

   1     would take over as Chairman of the Hospital Medical
   2     Committee from the beginning of April. Until now the
   3     roles of Chairman of the Hospital Medical Committee and
   4     Medical Director had been combined but over the three
   5     years since becoming a Trust it had been evident that
   6     with clinical commitments the combination of the two
   7     roles was becoming untenable."
   8        So it does look as if it was your view that the
   9     burden was too much?
  10   A. From that, it does. I do not recall clearly Mr Wisheart
  11     coming to me and saying "We cannot do it", but I am
  12     certain from discussion one saw the involvement getting
  13     more not less and therefore the wisdom of splitting it.
  14   Q. So this view had not been formed because Mr Wisheart had
  15     come to you to complain he had too much to do, it was
  16     a view you had formed from observation?
  17   A. I have no recall of him doing so.
  18   Q. I think if we look at UBHT 8/553, this is just a couple
  19     of months further on. We see the Executive Committee
  20     notes. If we go to 559, we see the first two paragraphs
  21     there. The second paragraph in particular:
  22        "Mr Durie thanked Mr Wisheart on behalf of the
  23     Board for having carried the double responsibility of
  24     Medical Director and Chairman of the HMC. This had
  25     become an untenable [same word again] burden and thus

   1     the roles had now been split with Mr Wisheart continuing
   2     to be Medical Director."
   3   A. Yes.
   4   Q. So to be clear about this, you do not recollect
   5     Mr Wisheart ever coming to the Board and saying "This
   6     burden is untenable, or becoming untenable, please split
   7     these roles"?
   8   A. I do not recall that. I am trying to recall back quite
   9     a long time, but that might have been political (with
  10     a small "p"), the statement about being untenable,
  11     because otherwise why was this new man Dr Laszlo not
  12     becoming both? We were splitting it and wanting to show
  13     him that it was not that we did not trust his level of
  14     competence. We believed by now it was wise that you had
  15     two people.
  16   Q. If we go back to the first of those minutes,
  17     17th December 1993, UBHT 7/166, if we look down that
  18     page to the paragraph we were at, in (c), halfway down:
  19        "Professor Pickering expressed concern that the
  20     decision such as splitting these roles should have been
  21     made without consultation with the Board."
  22        You said that you should have given the Board the
  23     opportunity to consider the proposal before a decision
  24     had been made?
  25   A. I took that I think quite rightly as a rap on the

   1     knuckles, because obviously he was not one of the people
   2     with whom I had talked.
   3   Q. So if Professor Pickering had not been involved in the
   4     decision to split these roles, you plainly had; who else
   5     had?
   6   A. Certainly Dr Roylance, and -- I cannot recall at this
   7     stage which other of the non-executives I spoke with.
   8   Q. I asked you a couple of minutes ago about an answer in
   9     which you used the expression "we" and you said "we
  10     would really have been myself and Dr Roylance and the
  11     non-executive directors"?
  12   A. I did.
  13   Q. This extract would suggest, would it not, that the
  14     non-executive directors had not been involved.
  15     Certainly, Professor Pickering had not, and the Board
  16     had not, in taking this decision?
  17   A. That is correct. Certainly Professor Pickering had not
  18     been. I cannot recall at this stage which of the other
  19     ones I spoke with.
  20   Q. If we go to WIT 86/29, this is Appendix C to your
  21     statement. This splitting of HMC and Medical Director:
  22     would that fall within paragraph 7 or paragraph 9?
  23   A. Looking back, I cannot remember. Looking at that, the
  24     answer is you could either say it did or did not.
  25     Certainly Professor Pickering believed it did.

   1     I accepted the criticism of not having discussed it with
   2     everybody. I think with the benefit of hindsight,
   3     I certainly would have included it in either 6 or 9, and
   4     would wish that we had discussed it more formally.
   5   Q. Was it common for Dr Roylance and yourself effectively
   6     to take decisions such as this without recourse to the
   7     non-executive directors?
   8   A. It was always an interesting balance which decisions it
   9     was right to take there and then rather than wait until
  10     we all met at the monthly meeting.
  11   Q. You announced your retirement, as opposed to actually
  12     did retire, on 11th March 1994 at a meeting of the
  13     Trust. Let us go briefly, UBHT 8/553; the middle of the
  14     page. You had written to Rennie Fritchie to confirm you
  15     wished to retire. It was not in yours or the Board's
  16     gift to determine who would succeed you, but you were
  17     lobbying those concerned and hoped the successor would
  18     be in post by 30th June?
  19   A. Yes.
  20   Q. Who were you lobbying?
  21   A. May I answer first how we got to that decision? On this
  22     occasion I definitely did talk to the non-executives,
  23     and it was known that the Chief Executive, Dr Roylance,
  24     would be retiring towards the end of 1995, and as
  25     non-executives and myself, we discussed which was

   1     better: for an existing Chairman who knew the system
   2     quite well to be involved in choosing Dr Roylance's
   3     successor, as my normal term would have run through to
   4     about November 1994, or was it better to have a new
   5     Chairman in, get him established and then he would
   6     choose the person with whom he wished to work.
   7        We decided on the latter, which is why I went
   8     early.
   9        Coming to whom were we lobbying, it was not our
  10     choice; it was the choice of by this time I think they
  11     were called the Chairman of the "outpost", or some such
  12     other title, but there was a Chairman who looked after
  13     the overall interests of Trusts and purchasers and
  14     everybody else in the South and West. So that would be
  15     an individual we would be lobbying.
  16        Politicians have involvement in who becomes
  17     Chairman an