Health and Social Care Bill (HC Bill 221)

(a) if Monitor grants the application, it must notify the applicant of the
matters specified in subsection (3), and

(b) if Monitor refuses the application, it must notify the applicant of the
reasons for the refusal.

(10) 5In this Chapter, “health special administrator” has the meaning given in
Chapter 6 (see section 131(3)).

140 Grants and loans

(1) Monitor may not provide financial assistance under section 139 in the form of
a grant or loan unless it is satisfied that—

(a) 10it is necessary for the provider—

(i) to be able to continue to provide designated services, or

(ii) to be able to secure a viable business in the long term, and

(b) no other source of funding which would enable it do so and on which
it would be reasonable for it to rely is likely to become available to it.

(2) 15The terms of a grant or loan must include a term that the whole or a specified
part of the grant or loan becomes repayable in the event of a breach by the
provider or health special administrator of the terms of the grant or loan.

(3) Subject to that, where Monitor makes a grant or loan under section 139, it may
do so in such manner and on such terms as it may determine.

(4) 20Monitor may take such steps as it considers appropriate (including steps to
adjust the amount of future payments towards the mechanism established
under section 137 to raise funds for grants or loans under section 139) to
recover overpayments in the provision of a grant or loan under that section.

(5) The power to recover an overpayment under subsection (4) includes a power
25to recover interest, at such rate as Monitor may determine, on the amount of
the overpayment for the period beginning with the making of the overpayment
and ending with its recovery.

Charges on commissioners

141 Power to impose charges on commissioners

(1) 30The Secretary of State may by regulations confer power on Monitor to require
commissioners to pay charges relating to such of Monitor’s functions that
relate to securing the continued provision of designated services.

(2) The regulations must provide that the amount of a charge imposed by virtue
of this section is to be such amount—

(a) 35as may be prescribed, or

(b) as is determined by reference to such criteria, and by using such
method, as may be prescribed.

(3) The regulations must—

(a) prescribe to whom the charge is to be paid;

(b) 40prescribe when the charge becomes payable;

(c) where the amount of the charge is to be determined in accordance with
subsection (2)(b), require Monitor to carry out consultation in
accordance with the regulations before imposing the charge;

(d) provide for any amount that is not paid by the time prescribed for the
purposes of paragraph (b) to carry interest at the rate for the time being
specified in section 18 of the Judgments Act 1838;

(e) provide for any unpaid balance and accrued interest to be recoverable
5summarily as a civil debt.

(4) Where the person that the regulations prescribe for the purposes of subsection
(3)(a) is a provider, the regulations may confer power on Monitor to require the
provider to pay Monitor the amount of the charge in question in accordance
with the regulations.

(5) 10Before making regulations under this section, the Secretary of State must
consult—

(a) Monitor, and

(b) the National Health Service Commissioning Board.

(6) Regulations under this section may apply with modifications provision made
15by sections 144 to 146 in relation to charges imposed by virtue of this section.

Levy on providers

142 Imposition of levy

(1) The power under section 138(2) includes, in particular, power to impose a levy
on providers for each financial year.

(2) 20Before deciding whether to impose a levy under this section for the coming
financial year, Monitor must estimate—

(a) the amount that will be required for the purpose of providing financial
assistance in accordance with this Chapter,

(b) the amount that will be collected from commissioners by way of
25charges imposed by virtue of section 141 during that year, and

(c) the amount that will be standing to the credit of the fund at the end of
the current financial year.

(3) Before the start of a financial year in which Monitor proposes to impose a levy
under this section, it must determine—

(a) 30the factors by reference to which the rate of the levy is to be assessed,

(b) the time or times by reference to which those factors are to be assessed,
and

(c) the time or times during the year when the levy, or an instalment of it,
becomes payable.

(4) 35Where the determinations under subsection (3) reflect changes made to the
factors by reference to which the levy is to be assessed, the notice under section
146(1)(b) must include an explanation of those changes.

(5) A levy under this section may be imposed at different rates for different
providers.

143 40Power of Secretary of State to set limit on levy and charges

(1) Before the beginning of each financial year, the Secretary of State may, with the
approval of the Treasury, specify by order—

(a) the maximum amount that Monitor may raise from levies it imposes
under section 142 for that year, and

(b) the maximum amount that it may raise from charges it imposes by
virtue of section 141 for that year.

(2) 5Where the Secretary of State makes an order under this section, Monitor must
secure that the levies and charges for that year are at a level that Monitor
estimates will, in each case, raise an amount not exceeding the amount
specified for that case in the order.

144 Consultation

(1) 10This section applies where Monitor is proposing to impose a levy under section
142 for the coming financial year and—

(a) has not imposed a levy under that section for that or any previous year,

(b) has been imposing the levy for the current financial year but proposes
to make relevant changes to it for the coming financial year, or

(c) 15has been imposing the levy for the current financial year and the
financial year preceding it, but has not been required to serve a notice
under this section in respect of the levy for either of those years.

(2) A change to a levy is relevant for the purposes of subsection (1)(b) if it is a
change to the factors by reference to which the levy is to be assessed.

(3) 20Before making the determinations under section 142(3) in respect of the levy,
Monitor must send a notice to—

(a) the Secretary of State,

(b) the National Health Service Commissioning Board,

(c) each commissioning consortium,

(d) 25each provider, and

(e) such other persons as it considers appropriate.

(4) Monitor must publish a notice that it sends under subsection (3).

(5) In a case within subsection (1)(a) or (c), the notice must state—

(a) the factors by reference to which Monitor proposes to assess the rate of
30the levy,

(b) the time or times by reference to which it proposes to assess the rate of
levy, and

(c) the time or times during the coming financial year when it proposes
that the levy, or an instalment of it, will become payable.

(6) 35In a case within subsection (1)(b), the notice must specify the relevant changes
Monitor proposes to make.

(7) A notice under this section must specify when the consultation period in
relation to the proposals ends; and for that purpose, the consultation period is
the period of 28 days beginning with the day on which the notice is published
40under subsection (4).

145 Responses to consultation

(1) If Monitor receives objections from one or more providers to its proposals, it
may not give notice under section 146(1)(b) unless—

(a) the conditions in subsection (2) are met, or

(b) where those conditions are not met, Monitor has made a reference to
the Competition Commission.

(2) The conditions referred to in subsection (1)(a) are that—

(a) one or more providers object to the proposals within the consultation
5period, and

(b) the objection percentage and the share of supply percentage are each
less than the prescribed percentage.

(3) In subsection (2)—

(a) the “objection percentage” is the proportion (expressed as a percentage)
10of the providers who objected to the proposals, and

(b) the “share of supply percentage” is the proportion (expressed as a
percentage) of the providers who objected to the proposals, weighted
according to their share of the supply in England of such services as
may be prescribed.

(4) 15A reference under subsection (1)(b) must be so framed as to require the
Competition Commission to investigate and report on the questions—

(a) whether in making the proposals, Monitor failed to give sufficient
weight to the matters in section 61,

(b) if so, whether that failure operates, or may be expected to operate,
20against the public interest, and

(c) if so, whether the effects adverse to the public interest which that
failure has or may be expected to have could be remedied or prevented
by changes to the proposals.

(5) Schedule 10 (which makes further provision about references to the
25Competition Commission) has effect in relation to a reference under subsection
(1)(b); and for that purpose—

(a) paragraph 1 is to be ignored,

(b) in paragraph 5(2), the reference to six months is to be read as a reference
to two months,

(c) 30in paragraph 5(4), the reference to six months is to be read as a reference
to one month,

(d) in paragraph 7, sub-paragraphs (4) to (7) and (9) are to be ignored (and,
in consequence of that, in sub-paragraph (8), the words from the
beginning to “sub-paragraph (4)(c)” are also to be ignored), and

(e) 35the references to relevant persons are to be construed in accordance
with subsection (6).

(6) The relevant persons referred to in Schedule 10 are—

(a) in paragraphs 3 and, 5(6) and 6(6)—

(i) the National Health Service Commissioning Board, and

(ii) 40the providers who objected to the proposals, and

(b) in paragraph 8(10)—

(i) Monitor, and

(ii) the providers who objected to the proposals.

(7) In investigating the question under subsection (4)(a), the Competition
45Commission must have regard to the matters in relation to which Monitor has
duties under this Chapter.

(8) Regulations prescribing a percentage for the purposes of subsection (2)(b) may
include provision prescribing the method used for determining a provider’s
share of the supply in England of the services concerned.

146 Amount payable

(1) 5Monitor must—

(a) calculate the amount which each provider who is to be subject to a levy
under section 142 for a financial year is to be liable to pay in respect of
that year, and

(b) notify the provider of that amount and the date or dates on which it, or
10instalments of it, will become payable.

(2) If the provider is to be subject to the levy for only part of the financial year, it
is to be liable to pay only the amount which bears to the amount payable for
the whole financial year the same proportion as the part of the financial year
for which the provider is to be subject to the levy bears to the whole financial
15year.

(3) The amount which a provider is liable to pay may be zero.

(4) Subsection (5) applies if, during a financial year in which Monitor is imposing
a levy under section 142, it becomes satisfied that the risk of a provider who is
subject to the levy going into health special administration has changed by
20reference to what it was—

(a) at the start of the year, or

(b) if Monitor has already exercised the power under subsection (5) in
relation to the levy in the case of that provider, at the time it did so.

(5) Monitor may notify the provider that Monitor proposes to adjust the amount
25that the provider is liable to pay so as to reflect the change; and the notice must
specify the amount of the proposed adjustment.

(6) Following the expiry of the period of 28 days beginning with the day after that
on which Monitor sends the notice, it may make the adjustment.

(7) In a case within subsection (2), subsection (4) has effect as if references to the
30financial year were references to the part of the financial year for which the
provider is to be subject to the levy.

(8) Where a provider who reasonably believes that Monitor has miscalculated the
amount notified to the provider under subsection (1) or (5) requests Monitor to
recalculate the amount, Monitor must—

(a) 35comply with the request, and

(b) send the provider written notice of its recalculation.

(9) Subsection (8) does not apply to a request to recalculate an amount in respect
of a financial year preceding the one in which the request is made.

(10) If the whole or part of the amount which a person is liable to pay is not paid by
40the date by which it is required to be paid, the unpaid balance carries interest
at the rate for the time being specified in section 17 of the Judgments Act 1838;
and the unpaid balance and accrued interest are recoverable summarily as a
civil debt.

Supplementary

147 Investment principles and reviews

(1) Monitor must prepare and publish a statement of the principles that govern its
decisions, or decisions made on its behalf, about making investments for the
5purposes of this Chapter.

(2) Monitor must—

(a) in each financial year, review the statement,

(b) if it considers necessary in light of the review, revise the statement, and

(c) if it revises the statement, publish the revised statement.

(3) 10As soon as reasonably practicable after the end of each financial year, Monitor
must undertake and publish a review of the operation during that year of—

(a) the procedure for health special administration under Chapter 6, and

(b) such mechanisms as have been established under section 137.

(4) The purposes of the review under subsection (3)(b) are—

(a) 15to assess the operation of the mechanisms concerned,

(b) to assess the accuracy of the estimates given by Monitor in relation to
the operation of the mechanisms,

(c) to assess what improvements can be made to the process for making
estimates in relation to the operation of the mechanisms, and

(d) 20to review the extent of the protection which the mechanisms are
required to provide.

(5) Where a fund established under section 138 has been in operation for the whole
or part of the year concerned, the review published under this section must
specify—

(a) 25the income of the fund during that year, and

(b) the expenditure from the fund during that year.

(6) Monitor must exclude from a review published under this section information
which it is satisfied is—

(a) commercial information the disclosure of which would, or might,
30significantly harm the legitimate business interests of an undertaking
to which it relates;

(b) information relating to the private affairs of an individual the
disclosure of which would, or might, significantly harm that person’s
interests.

148 35Borrowing

(1) Monitor may—

(a) borrow from a deposit-taker such sums as it may from time to time
require for exercising its functions under this Chapter;

(b) give security for sums that it borrows.

(2) 40But Monitor may not borrow if the effect would be—

(a) to take the aggregate amount outstanding in respect of the principal of
sums borrowed by it over such limit as the Secretary of State may by
order specify, or

(b) to increase the amount by which the aggregate amount so outstanding
exceeds that limit.

(3) In this section, “deposit-taker” means—

(a) a person who has permission under Part 4 of the Financial Services and
5Markets Act 2000, or

(b) an EEA firm of the kind mentioned in paragraph 5(b) of Schedule 3 to
that Act which has permission under paragraph 15 of that Schedule (as
a result of qualifying for authorisation under paragraph 12 of that
Schedule) to accept deposits.

(4) 10The definition of “deposit-taker” in subsection (3) must be read with—

(a) section 22 of the Financial Services and Markets Act 2000,

(b) any relevant order under that section, and

(c) Schedule 2 to that Act.

149 Shortfall or excess of available funds, etc.

(1) 15The Secretary of State may provide financial assistance to Monitor if the
Secretary of State is satisfied that—

(a) there are insufficient funds available from a mechanism established
under section 137, or

(b) the mechanism is otherwise unable to operate effectively.

(2) 20If the Secretary of State is satisfied that the level of funds available from a
mechanism established under section 137 exceeds the level that is necessary,
the Secretary of State may direct Monitor to transfer the excess to the Secretary
of State.

(3) If the Secretary of State is satisfied that a mechanism established under section
25137 has become dormant, or if a mechanism so established is being wound up,
the Secretary of State may direct Monitor to transfer to the Secretary of State
such funds as are available from the mechanism.

CHAPTER 8 Miscellaneous and general

150 Secretary of State’s duty as respects variation in provision of health services

30After section 12D of the National Health Service Act 2006 insert—

“Miscellaneous

12E Secretary of State’s duty as respects variation in provision of health
services

(1) The Secretary of State must not exercise the functions mentioned in
35subsection (2) for the purpose of causing a variation in the proportion
of services provided as part of the health service that is provided by
persons of a particular description if that description is by reference
to—

(a) whether the persons in question are in the public or (as the case
40may be) private sector, or

(b) some other aspect of their status.

(2) The functions mentioned in this subsection are the functions of the
Secretary of State under—

(a) sections 6E and 13A, and

(b) 5section 70 of the Health and Social Care Act 2011 (requirements
as to procurement, patient choice and competition).”

151 Service of documents

(1) A notice required under this Part to be given or sent to or served on a person
(“R”) may be given or sent to or served on R—

(a) 10by being delivered personally to R,

(b) by being sent to R—

(i) by a registered post service, as defined by section 125(1) of the
Postal Services Act 2000, or

(ii) by a postal service which provides for the delivery of the
15document to be recorded, or

(c) subject to section 152, by being sent to R by an electronic
communication.

(2) Where a notice is sent as mentioned in subsection (1)(b), it is, unless the
contrary is proved, to be taken to have been received on the third day after the
20day on which it is sent.

(3) Where notice is sent as mentioned in subsection (1)(c) in accordance with
section 152, it is, unless the contrary is proved, to be taken to have been
received on the next working day after the day on which it is transmitted.

(4) In subsection (3) “working day” means a day other than—

(a) 25a Saturday or a Sunday;

(b) Christmas Day or Good Friday; or

(c) a day which is a bank holiday in England under the Banking and
Financial Dealings Act 1971.

(5) A notice required under this Part to be given or sent to or served on a body
30corporate or a firm is duly given, sent or served if it is given or sent to or served
on the secretary or clerk of that body or a partner of that firm.

(6) For the purposes of section 7 of the Interpretation Act 1978 in its application to
this section, the proper address of a person is—

(a) in the case of a person who holds a licence under Chapter 4 who has
35notified Monitor of an address for service, that address, and

(b) in any other case, the address determined in accordance with
subsection (7).

(7) That address is—

(a) in the case of a secretary or clerk of a body corporate, the address of the
40registered or principal office of the body,

(b) in the case of a partner of a firm, the address of the principal office of
the firm, and

(c) in any other case, the last known address of the person.

(8) In this section and in section 152—

Health and Social Care BillPage 148

• “electronic communication” has the same meaning as in the Electronic
  Communications Act 2000;

• “notice” includes any other document.

(9) This section is subject to paragraph 4(3) of Schedule 8 (delivery of notice from
5Secretary of State of suspension of non-executive member of Monitor).

152 Electronic communications

(1) If a notice required or authorised by this Part to be given or sent by or to a
person or to be served on a person is sent by an electronic communication, it is
to be treated as given, sent or served only if the requirements of subsection (2)
10or (3) are met.

(2) If the person required or authorised to give, send or serve the notice is Monitor
or the Competition Commission—

(a) the person to whom the notice is given or sent or on whom it is served
must have indicated to Monitor or (as the case may be) the Commission
15the person’s willingness to receive notices by an electronic
communication and provided an address suitable for that purpose, and

(b) the notice must be sent to or given or served at the address so provided.

(3) If the person required or authorised to give, send or serve the notice is not
Monitor or the Competition Commission, the notice must be given, sent or
20served in such manner as Monitor may require.

(4) An indication given for the purposes of subsection (2) may be given generally
for the purposes of notices required or authorised to be given, sent or served
by Monitor or (as the case may be) the Competition Commission under this
Part or may be limited to notices of a particular description.

(5) 25Monitor must publish such requirements as it imposes under subsection (3).

153 Interpretation and consequential amendments

(1) In this Part—

• “anti-competitive behaviour” has the meaning given in section 59 and
  references to preventing anti-competitive behaviour are to be read in
  30accordance with subsection (2) of that section;

• “commissioner”, in relation to a health care service, means the person who
  arranges for the provision of the service (and “commission” is to be
  construed accordingly);

• “designated service” means a service designated under section 79;

• 35“enactment” includes an enactment contained in subordinate legislation
  (within the meaning of the Interpretation Act 1978);

• “facilities” has the same meaning as in the National Health Service Act
  2006 (see section 275 of that Act);

• “financial year” means a period of 12 months ending with 31 March;

• 40“health care” and “health care service” each have the meaning given in
  section 59;

• “the NHS” has the meaning given in that section;

• “prescribed” means prescribed in regulations;

• “service” includes facility.

(2) 45Schedule 13 (which contains minor and consequential amendments) has effect.

Part 4 NHS foundation trusts & NHS trusts

Governance and management

154 Governors

(1) 5In paragraph 7 of Schedule 7 to the National Health Service Act 2006 (public
benefit corporation to have governors)—

(a) in sub-paragraph (1), for “a board of governors” substitute “a council of
governors”, and

(b) in sub-paragraphs (2), (3) and (4), for “the board” substitute “the
10council”.

(2) Omit paragraph 9(3) of that Schedule (requirement for at least one member of
council of governors to be appointed by PCT).

(3) For paragraph 9(7) of that Schedule (partnership organisations) substitute—

“(7) Any organisation specified in the constitution for the purposes of
15this sub-paragraph may appoint one or more members of the council
(but no more than the number specified for those purposes in the
constitution).”

(4) After paragraph 10 of that Schedule insert—

“10A The general duties of the council of governors are—

(a) 20to hold the non-executive directors individually and
collectively to account for the performance of the board of
directors, and

(b) to represent the interests of the members of the corporation as
a whole and the interests of the public.”

(5) 25After paragraph 10A of that Schedule insert—

“10B A public benefit corporation must take steps to secure that the
governors are equipped with the skills and knowledge they require
in their capacity as such.”

(6) After paragraph 10B of that Schedule insert—

“10C 30For the purpose of obtaining information about the corporation’s
performance of its functions or the directors’ performance of their
duties (and deciding whether to propose a vote on the corporation’s
or directors’ performance), the council of governors may require one
or more of the directors to attend a meeting.”

(7) 35In paragraph 23(4) of that Schedule (persons eligible for appointment as
auditor by governors), in sub-paragraph (c), for “the regulator” substitute “the
Secretary of State”.

(8) In paragraph 26(2) of that Schedule (information that must be given in annual
reports etc.), after paragraph (a) insert—

“(aa) 40information on any occasions in the period to which the
report relates on which the council of governors exercised its
power under paragraph 10C,”.