Health and Care Bill (HL Bill 71)

Health and Care BillPage 200

12In Schedule 13, in paragraph 10 (saving provision: general duty of
regulator), omit sub-paragraph (2).

13Omit Schedule 14 (abolition of NHS trusts in England: consequential
amendments).

5Finance Act 2012

14In section 216 of the Finance Act 2012 (health service bodies), omit
subsections (5) and (6).

Local Audit and Accountability Act 2014

15The Local Audit and Accountability Act 2014 is amended as follows.

1610In section 3 (general requirements for accounts), for subsection (9)
substitute—

(9)In this Act “health service body” means—

(a)an integrated care board;

(b)an NHS trust all or most of whose hospitals, establishments
15and facilities are situated in England.”

17In section 4 (general requirements for audit), at the end insert—

(6)In relation to an NHS trust, “accounts” means the annual accounts
prepared under paragraph 11A of Schedule 4 to the National Health
Service Act 2006.”

1820In section 8 (procedure for appointment), in subsection (4), at the end
insert—

(d)in the case of an NHS trust, it publishes the notice in such
manner as it thinks is likely to bring the notice to the attention
of persons to whom the trust provides services for the
25purposes of the health service in England.”

19In section 10 (functions of auditor panel), in subsection (10), at the end
insert—

(d)in the case of an NHS trust, it publishes the advice in such
manner as it thinks is likely to bring the advice to the
30attention of persons to whom the trust provides services for
the purposes of the health service in England.”

20In section 12 (failure to appoint local auditor), in subsections (1) and (2), for
“a clinical commissioning group,” substitute “a health service body”.

21(1)Section 13 (failure of clinical commissioning group to appoint local auditor)
35is amended as follows.

(2)In the heading, for “clinical commissioning group” substitute “health service
bodies”.

(3)In subsections (1) and (2), for “clinical commissioning group” substitute
“health service body”.

(4)40In subsection (4)—

(a)in paragraph (a), for “clinical commissioning group” substitute
“health service body”;

Health and Care BillPage 201

(b)in paragraph (b), for “group” substitute “health service body”.

(5)In subsection (5)(a), for “clinical commissioning group” substitute “health
service body”.

(6)In subsection (6)—

(a)5in paragraph (a), for “clinical commissioning group” substitute
“health service body”;

(b)in paragraph (b), for “group” substitute “health service body”.

(7)In subsection (7), for “clinical commissioning group” substitute “health
service body”.

2210In section 21 (general duties of auditors of accounts of health service bodies),
after subsection (2) insert—

(2A)In auditing the accounts of an NHS trust a local auditor must, by
examination of the accounts and otherwise, be satisfied—

(a)that the accounts present a true and fair view, and comply
15with the requirements of the enactments that apply to them,

(b)that proper practices have been observed in the preparation
of the accounts, and

(c)that the NHS trust has made proper arrangements for
securing economy, efficiency and effectiveness in its use of
20resources.”

23In section 30 (unlawful expenditure or activity of health service bodies), in
subsection (2), for paragraph (b) substitute—

(b)notify NHS England of the matter.”

24In section 43 (orders and regulations), in subsection (6), omit paragraphs (b)
25and (c).

25In section 44 (interpretation), in the definition of “accounts”, for “(5)”
substitute “(6)”.

26Omit section 47 (application to NHS trusts and trustees).

27In Schedule 2 (relevant authorities), after paragraph 23 insert—

23A30An NHS trust all or most of whose hospitals, establishments and
facilities are situated in England.”

28In Schedule 5 (eligibility and regulation of local auditors), in paragraph 5, in
the modified section 1214 of the Companies Act 2006—

(a)in subsection (1), after “(3),” insert “(3A),”

(b)35after subsection (3) insert—

(3A)This subsection applies if—

(a)the relevant authority is an NHS trust, and

(b)P is a director of that NHS trust.”

29(1)Schedule 7 (reports and recommendations) is amended as follows.

(2)40In paragraph 2, in sub-paragraph (3)(d), for “clinical commissioning group”
substitute “health service body”.

(3)In paragraph 3, in sub-paragraph (2)(c), for “clinical commissioning group”
substitute “health service body”.

Health and Care BillPage 202

(4)In paragraph 4, in sub-paragraph (8), at the end insert—

(d)in the case of an NHS trust, it publishes the notice in such
manner as it thinks is likely to bring the notice to the attention
of persons to whom the trust provides services for the
5purposes of the health service in England.”

Finance Act 2015

30In section 66 of the Finance Act 2015 (VAT refunds to certain charities), omit
subsection (6).

NHS (Charitable Trusts Etc) Act 2016

31(1)10Schedule 1 to the NHS (Charitable Trusts Etc) Act 2016 is amended as
follows.

(2)In paragraph 4(b), omit paragraph (ii) (including the “and” at the end).

(3)Omit paragraph 14.

(4)In paragraph 18, omit paragraphs (f) and (h).

(5)15Omit paragraph 19.

Section 61

Schedule 8 Trust special administrators: NHS trusts and NHS foundation trusts

Part 1 Amendments about trust special administrators

120The National Health Service Act 2006 is amended as follows.

2For section 65B—

65B NHS trusts: appointment of trust special administrator

(1)NHS England may make an order in accordance with this section
authorising the appointment of a trust special administrator to
25exercise the functions of the chair and directors of an NHS trust to
which this Chapter applies.

(2)NHS England—

(a)must make an order under subsection (1) if required to do so
by the Care Quality Commission, and

(b)30may otherwise make an order under subsection (1) only if—

(i)NHS England considers it appropriate to do so in the
interests of the health service, and

(ii)the Secretary of State has approved the making of the
order.

(3)35The Care Quality Commission may require NHS England to make an
order under subsection (1) only if it is satisfied that there is a serious

Health and Care BillPage 203

failure by the NHS trust to provide services that are of sufficient
quality to be provided under this Act.

(4)Before requiring NHS England to make an order under
subsection (1) the Care Quality Commission must—

(a)5consult the Secretary of State and NHS England, and

(b)having done that, consult—

(i)the trust,

(ii)any integrated care board in whose area the trust has
hospitals, establishments or facilities, and

(iii)10any person to which the trust provides goods or
services under this Act and which the Commission
considers it appropriate to consult.

Before making an order under subsection (1) in a case where it is not
required to do so by the Care Quality Commission, NHS England
15must consult—

(a)the trust,

(b)any integrated care board in whose area the trust has
hospitals, establishments or facilities,

(c)any other person to which the trust provides goods or
20services under this Act and which NHS England considers it
appropriate to consult, and

(d)the Care Quality Commission.

(6)An order under subsection (1) must specify the date when the
appointment is to take effect, which must be within the period of 5
25working days beginning with the day on which the order is made.

(7)NHS England must lay before Parliament (with the statutory
instrument containing the order) a report stating the reasons for
making the order.

(8)If an order is made under subsection (1), NHS England must—

(a)30appoint 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.

(9)A person appointed as a trust special administrator holds and
vacates office in accordance with the terms of the appointment.

(10)35NHS England may pay remuneration and expenses to a trust special
administrator appointed under this section.

65BA Care Quality Commission report on safety and quality of services

(1)This section applies where the Care Quality Commission require
NHS England to make an order under section 65B(1) in relation to an
40NHS trust.

(2)The Care Quality Commission must, as soon as reasonably
practicable after the making of the order, provide to NHS England
and the Secretary of State a report on the safety and quality of the
services that the trust provides under this Act.”

3(1)45Section 65D (NHS foundation trusts: appointment of trust special
administrator) is amended as follows.

Health and Care BillPage 204

(2)In subsections (1) and (1A)(b) and (c), for “the regulator”, in each place it
occurs, substitute “NHS England”.

(3)In subsection (2), for “The regulator” substitute “NHS England”.

(4)After subsection (2) insert—

(2A)5Where NHS England is not required to make an order under this
section as a result of subsection (1A), it may do so only if the
Secretary of State has approved the making of the order.”

(5)In subsection (3), for “the regulator” substitute “NHS England”.

(6)In subsection (3A)—

(a)10in paragraph (a), for “the regulator” substitute “NHS England”;

(b)in paragraph (b), omit sub-paragraph (ii) (but not the “and” at the
end).

(7)For subsection (4) substitute—

(4)Before making an order under this section in a case where it is not
15required to do so as a result of subsection (1A), NHS England must
consult—

(a)the trust,

(b)any person to which the trust provides services under this
Act and which NHS England considers it appropriate to
20consult, and

(c)the Care Quality Commission.”

(8)In subsection (6), for “The regulator” substitute “NHS England”.

(9)In subsection (7), for “the regulator” substitute “NHS England”.

(10)For subsection (12) substitute—

(12)25NHS England may pay remuneration and expenses to a trust special
administrator appointed under this section.”

4(1)Section 65DA (objective of trust special administration) is amended as
follows.

(2)In subsection (4)(c), for “the regulator” substitute “NHS England”.

(3)30In subsection (5), for “The regulator” substitute “NHS England”.

(4)In subsection (5A), for “the regulator” substitute “NHS England”.

(5)In subsection (6)—

(a)for “the regulator” substitute “NHS England”;

(b)omit paragraph (b).

(6)35In subsections (7), for “The Board” substitute “NHS England”.

(7)In subsection (8), for “the Board” substitute “NHS England”.

5(1)Section 65F (draft report) is amended as follows.

Health and Care BillPage 205

(2)For subsections (1) to (3) substitute—

(1)A trust special administrator appointed in relation to an NHS trust
must, within the period of 65 working days beginning with the day
on which the administrator’s appointment takes effect—

(a)5provide NHS England and the Secretary of State with a draft
report recommending any action that NHS England or the
Secretary of State should take in relation to the trust, and

(b)publish a copy of that draft report.

(1A)A trust special administrator appointed in relation to an NHS
10foundation trust must, within the period of 65 working days
beginning with the day on which the administrator’s appointment
takes effect—

(a)provide NHS England with a draft report recommending the
action that NHS England should take in relation to the trust,
15and

(b)publish a copy of that draft report,

unless unable to obtain the statements required by subsections (1B)
and (1C).

(1B)A trust special administrator may not provide a draft report under
20subsection (1A)

(a)without having obtained a statement from each
commissioner that the commissioner considers that the
recommendation in the draft report—

(i)would achieve the objective set out in section
2565DA(1)(a), and

(ii)would do so without harming essential services
provided for the purposes of the NHS by any other
NHS foundation trust or NHS trust that provides
services under this Act to the commissioner, or

(b)30where the administrator is unable to obtain a statement to
that effect from one or more of the commissioners (other than
NHS England), without having obtained a statement to that
effect from NHS England.

(1C)A trust special administrator may not provide a draft report under
35subsection (1A) without having obtained a statement from the Care
Quality Commission that it considers that the recommendation in
the draft report would achieve that part of the objective set out in
section 65DA(1)(aa).

(2)When preparing a draft report under subsection (1) or (1A), the
40administrator must consult—

(a)any person to which the trust provides goods or services
under this Act and which NHS England directs the
administrator to consult, and
the Care Quality Commission.

(3)45After receiving a draft report under subsection (1) or (1A), NHS
England must lay it before Parliament.”

(3)Omit subsection (4), (5) and (5A).

Health and Care BillPage 206

(4)For subsection (6) substitute—

(6)Where NHS England decides not to provide to the administrator a
statement to the effect mentioned in subsection (1B)(b), NHS
England must—

(a)5give a notice of the reasons for its decision to the
administrator,

(b)publish the notice, and

(c)lay a copy of it before Parliament.

(6A)Where the Care Quality Commission decides not to provide to the
10administrator a statement to the effect mentioned in subsection (1C),
the Commission must—

(a)give a notice of the reasons for its decision to the
administrator and to NHS England,

(b)publish the notice, and

(c)15lay a copy of it before Parliament.”

6(1)Section 65G (consultation plan) is amended as follows.

(2)In subsection (4)(b) for “the Board”, in both places it occurs, substitute “NHS
England”.

(3)For subsection (5) substitute—

(5)20Where NHS England decides not to provide to the administrator a
statement to the effect mentioned in subsection (4)(b), NHS England
must—

(a)give a notice of the reasons for its decision to the
administrator,

(b)25publish the notice, and

(c)lay a copy of it before Parliament.

(5A)Where the Care Quality Commission decides not to provide to the
administrator a statement to the effect mentioned in subsection (4A),
the Commission must—

(a)30give a notice of the reasons for its decision to the
administrator and to NHS England,

(b)publish the notice, and

(c)lay a copy of it before Parliament.”

7(1)Section 65H (consultation requirements) is amended as follows.

(2)35In subsection (7)—

(a)omit paragraph (za);

(b)in paragraph (b), omit “other”;

(c)for paragraphs (c) and (d) substitute—

(c)the member of Parliament for any constituency, if
40required by directions given by NHS England;

(d)any other person specified in a direction given by
NHS England.”

(3)Omit subsection (8).

(4)In subsection (9)(a), omit “the Board and”.

Health and Care BillPage 207

(5)After subsection (9) insert—

(9A)NHS England may direct the administrator to hold a meeting to seek
a response from any person.”

(6)For subsection (10) substitute—

(10)5The Secretary of State may direct NHS England as to the persons
from whom it should direct the administrator to—

(a)request a written response (for NHS England’s powers of
direction, see subsection (7)(c) and (d));

(b)seek a response by holding a meeting (for NHS England’s
10power of direction, see subsection (9A)).”

(7)Omit subsection (10A).

(8)In subsection (12), omit paragraph (b) and the “and” before it.

(9)Omit subsection (13).

8(1)Section 65I (final report) is amended as follows.

(2)15For subsection (1) substitute—

(1)A trust special administrator appointed in relation to an NHS trust
must, within the period of 15 working days beginning with the end
of the consultation period, provide NHS England and the Secretary
of State with a final report stating any action that the administrator
20recommends that NHS England or Secretary of State should take in
relation to the trust.

(1A)A trust special administrator appointed in relation to an NHS
foundation trust must, within the period of 15 working days
beginning with the end of the consultation period, provide NHS
25England with a final report stating the action that the administrator
recommends that NHS England should take in relation to the trust.”

(3)In subsection (2), after “the final report” insert “mentioned in subsection (1)
or (1A)”.

(4)In subsection (3), for “the Secretary of State” substitute “NHS England”.

(5)30Omit subsection (4).

9(1)Section 65J (power to extend time) is amended as follows.

(2)In subsection (1)—

(a)in paragraph (a) after “section 65F(1)” insert “or (1A)”;

(b)in paragraph (c), after section “65I(1)” insert “or (1A)”.

(3)35In subsection (2), for “the Secretary of State”, in both places it occurs,
substitute “NHS England”.

(4)Omit subsection (5).

10In the italic heading before section 65K for “the regulator” substitute “NHS
England”.

Health and Care BillPage 208

11For section 65K substitute—

65K Decision of NHS England or Secretary of State in case of NHS trust

(1)Within the period of 20 working days beginning with the day on
which NHS England receives a final report under section 65I relating
5to an NHS trust, the NHS England must decide what (if any) action
to take in relation to the trust.

(2)Within the period of 20 working days beginning with the day on
which the Secretary of State receives a final report under section 65I
relating to an NHS trust, the Secretary of State must decide what (if
10any) action to take in relation to the trust.

(3)NHS England and the Secretary of State must consult one another
before taking the decision under subsection (1) or (2).

(4)After taking a decision under subsection (1) or (2) NHS England or
the Secretary of State (as the case may be) must, as soon as reasonably
15practicable—

(a)publish a notice of the decision and of the reasons for it;
lay a copy of the notice before Parliament.”

12(1)Section 65KA (regulator’s decision in case of NHS foundation trust) is
amended as follows.

(2)20In the heading for “Regulator’s” substitute “NHS England’s”.

(3)In each of subsections (1) and (3) to (5), for “the regulator”, in each place it
occurs, substitute “NHS England”.

(4)In subsection (6), for “The regulator” substitute “NHS England”.

13(1)Section 65KB (Secretary of State’s response to regulator’s decision) is
25amended as follows.

(2)In the heading for “regulator’s” substitute “NHS England’s”.

(3)In subsections (1)(c) and (2)(b), for “the regulator” substitute “NHS
England”.

14In section 65KC (action following Secretary of State’s rejection of final
30report), in subsections (1) and (2), for “the regulator” substitute “NHS
England”.

15(1)In section 65KD (Secretary of State’s response to resubmitted report) is
amended as follows.

(2)In subsection (3), for “(4) to” substitute “(5), (6) and”.

(3)35Omit subsection (4).

(4)For subsections (5) and (6) substitute—

(5)If the notice states that an integrated care board has failed to
discharge a function—

(a)the board is to be treated for the purposes of this Act as
40having failed to discharge the function,

(b)the Secretary of State may exercise the functions of NHS
England under section 14Z59(2), (3)(a) and (5)(a), and

Health and Care BillPage 209

(c)NHS England may not exercise any of its functions under
section 14Z59.

(6)Where, by virtue of subsection (5)(b), the Secretary of State exercises
the function of NHS England under section 14Z59(3)(a), the
5integrated care board to which the direction is given must cooperate
with the Secretary of State.”

(5)Omit subsections (7) and (8).

16(1)Section 65L (trusts coming out of administration) is amended as follows.

(2)For subsections (1) to (2B) substitute—

(1)10Subsection (2) applies, in relation to an NHS trust, if NHS England
and the Secretary of State both decide under section 65K not to
dissolve the trust.

(2)NHS England must make an order specifying a date when the
following come to an end—

(a)15the appointment of the trust special administrator, and

(b)the suspension of the chair and directors of the trust.

(2A)Subsection (2B) applies, in relation to an NHS foundation trust, if—

(a)the Secretary of State decides under section 65KD(9) not to
dissolve the trust, or

(b)20the Secretary of State decides under section 65KB(1) or
65KD(1) that the Secretary of State is satisfied of the matters
mentioned there, and the action recommended in the final
report is to do something other than dissolve the trust.

(2B)NHS England must make an order specifying a date when the
25following come to an end—

(a)the appointment of the trust special administrator, and

(b)the suspension of the governors, chair and directors of the
trust.”

(3)In subsection (7), for “the regulator”, in both places it occurs, substitute
30NHS England”.

17In section 65LA (trusts to be dissolved), in subsection (3), for “The regulator”
substitute “NHS England”.

18(1)Section 65M (replacement of trust special administrator) is amended as
follows.

(2)35For subsection (1) substitute—

(1)If a trust special administrator ceases to hold office for any reason
before an order is made under section 65L(2) or (2B) or the trust is
dissolved, NHS England must—

(a)appoint another person as the trust special administrator,
40and

(b)publish the name of the person appointed.”

(3)In subsection (2), for “the Secretary of State” substitute “NHS England”.

(4)Omit subsection (3).