Around 150 National Health Service (NHS) employees at Birmingham and Solihull Mental Health NHS Foundation Trust began a three-day strike on June 24, protesting plans to transfer 40 members of the support staff to Summerhill Services Ltd (SSL). The SSL is a wholly owned subsidiary of the NHS designed to avoid paying tax. Members of the NHS support staff at Birmingham have been transferred to Summerhill Services Ltd with effect from July 1. The strikers include porters, housekeepers, domestic assistants and maintenance staff. The strike was called by the unions, Unite and Unison.
A wholly owned subsidiary is a company whose common stock is 100% owned by its parent company. These days, trusts are forming wholly owned subsidiary companies in England so that they can register for value-added tax (VAT) exemption. NHS trusts have formed such companies to be able to compete on a level playing field with commercial competitors who register for VAT exemption for their work in the NHS.
Explaining how the transfer will affect the employees, Unison said, “The Summerhill Services was set up by the trust to cut costs by taking advantage of a tax loophole. It does not have to honor future NHS pay agreements, enabling it to alter the pay and conditions of staff and employ new people on inferior terms.”
Angela, a Unite member, told the Socialist Worker, “We want to stay in the NHS. Summerhill Services Ltd should leave us alone — that’s our message to the country.”
“This unpalatable transfer will strip our members of their status as NHS employees and is a part of the accelerating backdoor privatization of the health service. Ultimately, it will lead to salami slicing of patient services. Unite is disappointed that trust bosses want to push ahead with their plans, despite the overwhelming opposition of the workforce,” Frank Keogh, the Unite regional officer, said.