FINANCIAL EFFECTS OF THE BILL

The administrative arrangements for recovering the costs of NHS treatment put in place by the Bill are expected to lead to a significant increase in the amounts of money recovered, as compared with the arrangements under the Road Traffic Act 1988. This money will be available in hospitals and can be used, for example, to improve direct patient care. Some additional direct costs will accrue as a result of the administrative changes. The costs could be up to £1.4 million in a full year at current prices but will be absorbed within existing resources and will, therefore, not lead to an overall increase in public expenditure.

EFFECTS OF THE BILL ON PUBLIC SERVICE MANPOWER

Due to efficiencies made possible by the introduction of a new IT system, staffing levels are not expected to rise significantly. Allowance has been made in preliminary costings for around 50 staff to be allocated to this task, based at the Compensation Recovery Unit in Tyneside.

SUMMARY OF THE REGULATORY IMPACT ASSESSMENT

The regulatory impact assessment looked at four options for future collection: leave the system as it is; establish a central levy on the insurance industry; secondary legislation to increase amounts already raised; and primary legislation to introduce a better functioning collection system. It concluded that the introduction of a new collection scheme, by way of primary legislation, would best enable the NHS to collect full costs.

The compliance costs for business of this option are overwhelmingly accounted for by the NHS charges themselves with the additional administrative costs being very small. No disproportionate impact could be identified for small businesses.

The effects of the Bill on motorists, if passed on by the insurers, is estimated to be in the region of 2-3% (£6 to £9) on a typical policy.

There will be the loss of some business for companies which have provided individual hospitals with an income recovery or debt collection service. However the ending of such contracts is also an efficiency saving for the hospitals as the collection of charges will no longer have to be financed by them.

The proposed changes have been discussed with insurance industry representatives, some individual insurance companies, the Law Society, the Law Commission and the Motor Insurers' Bureau.

A copy of the full appraisal can be obtained from :

• Department of Health Stores, PO Box 410, Wetherby, Leeds LS23 7LN Fax number: 0990 210 266

COMMENCEMENT DATE

It is intended that this legislation will come into effect, after Royal Assent, on 5 April 1999.

EUROPEAN CONVENTION ON HUMAN RIGHTS

Section 19 of the Human Rights Act 1998 requires the Minister in charge of a Bill in either House of Parliament to make a statement about the compatibility of the provisions of the Bill with the Convention rights (as defined by section 1 of that Act). The statement has to be made before Second Reading. On 25 November 1998 the Secretary of State for Health made the following statement:

In my view the provisions of the Road Traffic (NHS Charges) Bill are compatible with the Convention rights.