Session 2010 - 12
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Health and Social Care Bill


Health and Social Care Bill
Part 4 — NHS foundation trusts & NHS trusts

167

 

174     

Trust special administrators

(1)   

In section 65A of the National Health Service Act 2006 (bodies to which trust

special administration regime applies)—

(a)   

in subsection (1), for paragraphs (b) and (c) substitute—

“(b)   

any NHS foundation trust.”, and

5

(b)   

omit subsection (2).

(2)   

For the title to section 65B of that Act substitute “NHS trusts: appointment of

trust special administrator”.

(3)   

In section 65D of that Act (NHS foundation trusts: regulator’s notice), for

subsections (1) to (3) substitute—

10

“(1)   

This section applies if the regulator is satisfied that an NHS foundation

trust is, or is likely to become, unable to pay its debts.

(2)   

The regulator may make an order authorising the appointment of a

trust special administrator to exercise the functions of the governors,

chairman and directors of the trust.

15

(3)   

As soon as reasonably practicable after the making of an order under

subsection (2), the Care Quality Commission must provide to the

regulator a report on the safety and quality of the services that the trust

provides under this Act.”

(4)   

In subsection (4) of that section—

20

(a)   

for “giving a notice” substitute “making an order”,

(b)   

after paragraph (a) insert—

“(aa)   

the Board,”,

(c)   

omit paragraph (b),

(d)   

in paragraph (c), omit “goods or”, and

25

(e)   

after paragraph (c) insert “, and

(d)   

the Care Quality Commission.”

(5)   

After that subsection insert—

“(5)   

An order under subsection (2) must specify the date when the

appointment is to take effect, which must be within the period of 5

30

working days beginning with the day on which the order is made.

(6)   

The regulator must lay before Parliament (with the statutory

instrument containing the order) a report stating the reasons for

making the order.

(7)   

If the regulator makes an order under subsection (2), it must—

35

(a)   

appoint a person as the trust special administrator with effect

from the day specified in the order, and

(b)   

publish the name of the person appointed.

(8)   

A person appointed as a trust special administrator under this section

holds and vacates office in accordance with the terms of the

40

appointment.

(9)   

A person appointed as a trust special administrator under this section

must manage the trust’s affairs, business and property, and exercise the

trust special administrator’s functions, so as to achieve the objective set

 
 

Health and Social Care Bill
Part 4 — NHS foundation trusts & NHS trusts

168

 

out in section 65DA as quickly and as efficiently as is reasonably

practicable.

(10)   

When the appointment of a trust special administrator under this

section takes effect, the trust’s governors, chairman and executive and

non-executive directors are suspended from office; and Chapter 5 of

5

this Part, in its application to the trust, is to be read accordingly.

(11)   

But subsection (10) does not affect the employment of the executive

directors or their membership of any committee or sub-committee of

the trust.

(12)   

The regulator may indemnify a trust special administrator appointed

10

under this section in respect of such matters as the regulator may

determine.”

(6)   

For the title to that section substitute “NHS foundation trusts: appointment of

trust special administrator”.

(7)   

Omit the cross-heading preceding that section.

15

175     

Objective of trust special administration

(1)   

After section 65D of the National Health Service Act 2006 insert—

“65DA   

 Objective of trust special administration

(1)   

The objective of a trust special administration is to secure—

(a)   

the continued provision of such of the services provided for the

20

purposes of the NHS by the NHS foundation trust that is subject

to an order under section 65D(2), at such level, as the

commissioners of those services determine, and

(b)   

that it becomes unnecessary for the order to remain in force for

that purpose.

25

(2)   

The commissioners may determine that the objective set out in

subsection (1) is to apply to a service only if they are satisfied that the

criterion in subsection (3) is met.

(3)   

The criterion is that ceasing to provide the service under this Act

would, in the absence of alternative arrangements for its provision

30

under this Act, be likely to—

(a)   

have a significant adverse impact on the health of persons in

need of the service or significantly increase health inequalities,

or

(b)   

cause a failure to prevent or ameliorate either a significant

35

adverse impact on the health of such persons or a significant

increase in health inequalities.

(4)   

In determining whether that criterion is met, the commissioners must

(in so far as they would not otherwise be required to do so) have regard

to—

40

(a)   

the current and future need for the provision of the service

under this Act,

(b)   

whether ceasing to provide the service under this Act would

significantly reduce equality between those for whom the

commissioner arranges for the provision of services under this

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Health and Social Care Bill
Part 4 — NHS foundation trusts & NHS trusts

169

 

Act with respect to their ability to access services so provided,

and

(c)   

such other matters as may be specified in relation to NHS

foundation trusts in guidance published by the regulator.

(5)   

The regulator may revise guidance under subsection (4)(c) and, if it

5

does so, must publish the guidance as revised.

(6)   

Before publishing guidance under subsection (4)(c) or (5), the regulator

must obtain the approval of—

(a)   

the Secretary of State;

(b)   

the Board.

10

(7)   

The Board must make arrangements for facilitating agreement between

commissioners in determining the services provided by the trust under

this Act to which the objective set out in subsection (1) is to apply.

(8)   

Where commissioners fail to reach agreement in pursuance of

arrangements under subsection (7), the Board may make the

15

determination (and the duty imposed by subsection (1)(a), so far as

applying to the commissioners concerned, is to be regarded as

discharged).

(9)   

In this section—

“commissioners” means the persons to which the trust provides

20

services under this Act, and

“health inequalities” means the inequalities between persons with

respect to the outcomes achieved for them by the provision of

services that are provided as part of the health service.”

(2)   

If, at any time before section 9 comes into force, Monitor obtains the approval

25

of the NHS Commissioning Board Authority to publish guidance under

section 65DA(4)(c) or (5) of the National Health Service Act 2006, that approval

is to be treated for the purposes of subsection (6)(b) of that section as approval

obtained from the National Health Service Commissioning Board.

176     

Procedure etc.

30

(1)   

In section 65F of the National Health Service Act 2006 (administrator’s draft

report), in subsection (2)—

(a)   

before paragraph (a) insert—

“(za)   

the Board,”, and

(b)   

omit paragraph (a) (but not the following “and”).

35

(2)   

At the end of that section insert—

“(4)   

For the purposes of this section in its application to the case of an NHS

foundation trust, the references to the Secretary of State are to be read

as references to the regulator.

(5)   

In the case of an NHS foundation trust, the administrator may not

40

provide the draft report to the regulator under subsection (1)—

(a)   

without having obtained from each commissioner a statement

that the commissioner considers that the recommendation in

the draft report would achieve the objective set out in section

65DA, or

45

 
 

Health and Social Care Bill
Part 4 — NHS foundation trusts & NHS trusts

170

 

(b)   

where the administrator does not obtain a statement to that

effect from one or more commissioners (other than the Board),

without having obtained a statement to that effect from the

Board.

(6)   

Where the Board decides not to provide to the administrator a

5

statement to that effect, the Board must—

(a)   

give a notice of the reasons for its decision to the administrator

and to the regulator;

(b)   

publish the notice;

(c)   

lay a copy of it before Parliament.

10

(7)   

In subsection (5), “commissioner” means a person to which the trust

provides services under this Act.”

(3)   

At the end of section 65G of that Act (consultation plan) insert—

“(4)   

In the case of an NHS foundation trust, the administrator may not make

a variation to the draft report following the consultation period—

15

(a)   

without having obtained from each commissioner a statement

that the commissioner considers that the recommendation in

the draft report as so varied would achieve the objective set out

in section 65DA, or

(b)   

where the administrator does not obtain a statement to that

20

effect from one or more commissioners (other than the Board),

without having obtained a statement to that effect from the

Board.

(5)   

Where the Board decides not to provide to the administrator a

statement to that effect, the Board must—

25

(a)   

give a notice of the reasons for its decision to the administrator

and to the regulator;

(b)   

publish the notice;

(c)   

lay a copy of it before Parliament.

(6)   

In subsection (4), “commissioner” means a person to which the trust

30

provides services under this Act.”

(4)   

In section 65H of that Act (consultation requirements), in subsection (7)—

(a)   

before paragraph (a) insert—

“(za)   

the Board,”,

(b)   

omit paragraph (a),

35

(c)   

in paragraph (b), omit “, if required by directions given by the Secretary

of State”, and

(d)   

after paragraph (c) insert “;

(d)   

any other person specified in a direction given by the

Secretary of State.”

40

(5)   

In subsection (8) of that section, omit paragraphs (a) to (d).

(6)   

In subsection (9) of that section—

(a)   

after “representatives of” insert “the Board and”, and

(b)   

for “(7)(a) or (b)” substitute “(7)(b), (c) or (d)”.

 
 

Health and Social Care Bill
Part 4 — NHS foundation trusts & NHS trusts

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(7)   

At the end of that section insert—

“(12)   

For the purposes of this section in its application to the case of an NHS

foundation trust—

(a)   

in subsection (7)(b), the words “goods or” are to be ignored, and

(b)   

in subsections (7)(c) and (d) and (10), the references to the

5

Secretary of State are to be read as references to the regulator.

(13)   

In the case of an NHS foundation trust, the Secretary of State may direct

the regulator as to persons from whom it should direct the

administrator under subsection (10) to request or seek a response.”

(8)   

At the end of section 65I of that Act (administrator’s final report) insert—

10

“(4)   

For the purposes of this section in its application to the case of an NHS

foundation trust, the references to the Secretary of State are to be read

as references to the regulator.”

(9)   

At the end of section 65J of that Act (power to extend time limits for preparing

reports and carrying out consultation) insert—

15

“(5)   

For the purposes of this section in its application to the case of an NHS

foundation trust, the references to the Secretary of State are to be read

as references to the regulator.”

177     

Action following final report

(1)   

In section 65K of the National Health Service Act 2006 (Secretary of State’s

20

decision on what action to take), in subsection (1), after “a final report under

section 65I” insert “relating to an NHS trust”; and in consequence of that, for

the title to that section substitute “Secretary of State’s decision in case of NHS

trust”.

(2)   

After that section insert—

25

“65KA   

Regulator’s decision in case of NHS foundation trust

(1)   

Within the period of 20 working days beginning with the day on which

the regulator receives a final report under section 65I relating to an

NHS foundation trust, the regulator must decide whether it is

satisfied—

30

(a)   

that the action recommended in the final report would achieve

the objective set out in section 65DA, and

(b)   

that the trust special administrator has carried out the

administration duties.

(2)   

In subsection (1)(b), “administration duties” means the duties imposed

35

on the administrator by—

(a)   

this Chapter,

(b)   

a direction under this Chapter, or

(c)   

the administrator’s terms of appointment.

(3)   

If the regulator is satisfied as mentioned in subsection (1), it must as

40

soon as reasonably practicable provide to the Secretary of State—

(a)   

the final report, and

(b)   

the report provided to the regulator by the Care Quality

Commission under section 65D(3).

 
 

Health and Social Care Bill
Part 4 — NHS foundation trusts & NHS trusts

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(4)   

If the regulator is not satisfied as mentioned in subsection (1), it must as

soon as reasonably practicable give a notice of that decision to the

administrator.

(5)   

Where the regulator gives a notice under subsection (4), sections 65F to

65J apply in relation to the trust to such extent, and with such

5

modifications, as the regulator may specify in the notice.

(6)   

The regulator must as soon as reasonably practicable after giving a

notice under subsection (4)—

(a)   

publish the notice;

(b)   

lay a copy of it before Parliament.

10

65KB    

Secretary of State’s response to regulator’s decision

(1)   

Within the period of 30 working days beginning with the day on which

the Secretary of State receives the reports referred to in section 65KA(3),

the Secretary of State must decide whether the Secretary of State is

satisfied—

15

(a)   

that the persons to which the NHS foundation trust in question

provides services under this Act have discharged their

functions for the purposes of this Chapter,

(b)   

that the trust special administrator has carried out the

administration duties (within the meaning of section

20

65KA(1)(b)),

(c)   

that the regulator has discharged its functions for the purposes

of this Chapter,

(d)   

that the action recommended in the final report would secure

the continued provision of the services provided by the trust to

25

which the objective set out in section 65DA applies,

(e)   

that the recommended action would secure the provision of

services that are of sufficient safety and quality to be provided

under this Act, and

(f)   

that the recommended action would provide good value for

30

money.

(2)   

If the Secretary of State is not satisfied as mentioned in subsection (1),

the Secretary of State must as soon as reasonably practicable—

(a)   

give the trust special administrator a notice of the decision and

of the reasons for it;

35

(b)   

give a copy of the notice to the regulator;

(c)   

publish the notice;

(d)   

lay a copy of it before Parliament.

65KC    

Action following Secretary of State’s rejection of final report

(1)   

Within the period of 20 working days beginning with the day on which

40

the trust special administrator receives a notice under section 65KB(2),

the administrator must provide to the regulator the final report varied

so far as the administrator considers necessary to secure that the

Secretary of State is satisfied as mentioned in section 65KB(1).

(2)   

Where the administrator provides to the regulator a final report under

45

subsection (1), section 65KA applies in relation to the report as it

applies in relation to a final report under section 65I; and for that

purpose, that section has effect as if—

 
 

Health and Social Care Bill
Part 4 — NHS foundation trusts & NHS trusts

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(a)   

in subsection (1), for “20 working days” there were substituted

“10 working days”, and

(b)   

subsection (3)(b) were omitted.

(3)   

If the Secretary of State thinks that, in the circumstances, it is not

reasonable for the administrator to be required to carry out the duty

5

under subsection (1) within the period mentioned in that subsection,

the Secretary of State may by order extend the period.

(4)   

If an order is made under subsection (3), the administrator must—

(a)   

publish a notice stating the date on which the period will expire,

and

10

(b)   

where the administrator is proposing to carry out consultation

in response to the notice under section 65KB(2), publish a

statement setting out the means by which the administrator will

consult during the extended period.

65KD    

Secretary of State’s response to re-submitted final report

15

(1)   

Within the period of 30 working days beginning with the day on which

the Secretary of State receives a final report under section 65KA(3) as

applied by section 65KC(2), the Secretary of State must decide whether

the Secretary of State is, in relation to the report, satisfied as to the

matters in 65KB(1)(a) to (f).

20

(2)   

If the Secretary of State is not satisfied as mentioned in subsection (1),

the Secretary of State must as soon as reasonably practicable—

(a)   

publish a notice of the decision and the reasons for it;

(b)   

lay a copy of the notice before Parliament.

(3)   

Where the Secretary of State publishes a notice under subsection (2)(a),

25

subsections (4) to (8) apply.

(4)   

If the notice states that the Board has failed to discharge a function—

(a)   

the Board is to be treated for the purposes of this Act as having

failed to discharge the function, and

(b)   

the failure is to be treated for those purposes as significant (and

30

section 13Z1 applies accordingly).

(5)   

If the notice states that a clinical commissioning group has failed to

discharge a function—

(a)   

the group is to be treated for the purposes of this Act as having

failed to discharge the function,

35

(b)   

the Secretary of State may exercise the functions of the Board

under section 14Z19(2), (3)(a) and (8)(a), and

(c)   

the Board may not exercise any of its functions under section

14Z19.

(6)   

Where, by virtue of subsection (5)(b), the Secretary of State exercises the

40

function of the Board under subsection (3)(a) of section 14Z19,

subsection (9)(a) of that section applies but with the substitution for the

references to the Board of references to the Secretary of State.

(7)   

If the notice states that the trust special administrator has failed to

discharge the administration duties (within the meaning of section

45

65KA(1)(b))—

 
 

 
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