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New Clause 4

Statement of national minimum standards

'.--(1) It shall be the duty of the Secretary of State to publish a statement of national minimum standards in respect of establishments or agencies required to be registered under this Part and to amend such statements from time to time as he deems appropriate.

(2) The Secretary of State may publish different statements under subsection (1) in respect of different descriptions of establishments or agencies.

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(3) Before publishing a statement or amendments to a statement, the Secretary of State shall comply with the requirements of subsections (4) and (5) below.
(4) The Secretary of State shall--
(a) consult such persons as he considers appropriate and, in determining who to consult, he shall take advice from the Commission; and
(b) request the Commission to give him advice as to the likely impact of the proposed statement or the proposed amendment on--
(i) the aggregate supply of the service provided by establishments or agencies of the type concerned in England and Wales; and
(ii) the cost of supplying such services in accordance with the statement of minimum standards;
and shall then publish a draft of a statement or of amendments to a statement.
(5) The Secretary of State shall lay before both Houses of Parliament a draft of any proposed statement of national minimum standards or amendments to a statement together with copies of representations received in respect of the consultation under subsection (4)(a) and the advice received from the Commission under subsection (4)(b).
(6) No statement of national minimum standards shall have effect unless a draft of it has been laid before each House of Parliament in accordance with subsection (5) and has been approved by resolution of each House of Parliament.
(7) Where a statement of national minimum standards applies to an establishment or agency, no person may be registered in respect of that establishment or agency unless the applicable national minimum standard is complied with.'.--[Mr. Hammond.]

Brought up, and read the First time.

Mr. Hammond: I beg to move, That the clause be read a Second time.

Mr. Deputy Speaker: With this it will be convenient to discuss the following: Amendment No. 38, in clause 22, page 13, leave out lines 14 and 15.

Amendment No. 39, in page 14, line 35, at end insert--

'(m) make provision in the case of an establishment providing cosmetic surgery as to--
(i) the nature of statements that may be made with regard to the services provided; and
(ii) the titles that may be used to describe persons carrying on, managing or employed at such an establishment'.

Government amendment No. 61.

Amendment No. 2, in clause 23, page 15, line 3, leave out Clause 23.

Mr. Hammond: New clause 4 and amendment No. 2, which is a paving amendment for it, would remove clause 23 from the Bill and substitute it with new clause 4. The new clause would do broadly the same things as clause 23, but with some important differences.

For the benefit of hon. Members who did not serve on the Standing Committee, I shall briefly explain what clause 23 does. It gives the Minister the power to

and to keep the statements of standards under review. The statements will not be subject to any parliamentary scrutiny; they will be prepared by the Minister and published after the consultation that he considers appropriate.

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Once the standards are published, they will "be taken into account"--that is a rather indefinite phrase--in making certain decisions and in any proceedings taken under the Bill. It also seems likely that the statements will be referred to in regulations made under other parts of the Bill. Therefore, the regulations that refer to the standards or incorporate them may be subject to scrutiny in the House, but the statements themselves will not be.

Of course, the Minister will consult with whoever he considers to be appropriate before he publishes the statement of minimum standards. However, I remind the House that people's businesses and livelihoods may be at stake and they may be driven out of business if they do not comply with the statement that the Minister has issued. For it to become effective, all he has to do is publish it; there will be no parliamentary scrutiny whatever.

New clause 4 and the paving amendment seek to do two things. First, the new clause would change the process of bringing into force a statement of minimum standards. It would place a clear obligation on the Secretary of State to prepare statements of minimum standards; he would not merely be allowed to publish them. The statements are a vital part of the structure that the Government are creating and the Secretary of State should have a clear obligation to prepare them.

Secondly, new clause 4 lays down a procedure for consultation outside Parliament and for a process of interaction with the commission, along the lines suggested by my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) in the previous debate. That process would require the Secretary of State to require from the commission an analysis of the likely effect of the statements of minimum standards so that he can make a proper appraisal of their probable impact on the supply of services and the cost of providing them. Finally, it provides for proper parliamentary scrutiny of the draft statement of minimum standards before it comes into force.

7 pm

Mr. Burns: Will my hon. Friend clarify proposed subsection (4)(b)(ii), which is a crucial part of the new clause and refers to

Does that mean the cost of supplying the service to the business providing it or does it mean the cost of supplying the service to the individual who is benefiting from it? Or does it mean both?

Mr. Hammond: The two are obviously related, but the provision is intended to relate to the cost to the business supplying the service. Proposed subsection (4)(b) seeks to ensure that, when formulating a draft statement of minimum standards which is to be laid before Parliament, the Secretary of State has advice from the commission about the likely effect of such a statement on the aggregate supply of services in England and Wales and the likely cost of supplying them.

My hon. Friend spoke about the connection between the cost to the business of supplying a service and the cost to the person enjoying it. Of course, he could go further and discuss the cost to the public purse because, in the majority of cases, the service will ultimately be paid for from the public purse. There is, therefore, a direct

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read-across from implications for costs on the businesses providing such services to implications for the public purse.

Mr. Bercow: Did I understand my hon. Friend correctly when he suggested that, in the absence of new clause 4, regulations will become effective on publication? Is my hon. Friend telling the House that, under the Bill, there is no required minimum period of consultation for draft regulations, and no required gap between the consultative process and the required date of implementation?

Mr. Hammond: As I understand it, the Secretary of State will consult such persons as he considers appropriate before publishing statements. However, those statements will become effective on publication. I am sure that the Minister will correct me if I have misunderstood that aspect of the working of clause 23.

May I go back to the point I was making about what the new clause seeks to do? First, it deals with the process of bringing such a statement into force and, secondly, it makes it clear in proposed subsection (7) that someone who does not comply with the statement of national minimum standards will not be registered. Clause 23 states:

in making decisions, in any proceedings for making orders and

That seems to be rather vague for a matter as important as national minimum standards. If a national minimum standard is to mean anything, it should mean that someone who does not comply with it cannot come to the table. New clause 4 would therefore provide that someone who does not comply with the standard cannot be registered.

Of course, we accept that many standards are going to be made--indeed, some have already been made in draft. The Under-Secretary of State for Education and Employment, the hon. Member for Barking (Ms Hodge), has already circulated draft minimum standards on child minding. It would, therefore, be wrong to lead the House into thinking that statements of minimum standards published under clause 23 or, indeed, our new clause would relate only to care homes. However, everyone present will understand why I will focus on the statements of minimum standards for care homes, as there cannot be a Member who has not received correspondence from owners, operators and residents of care homes in their constituencies expressing concern about the potential impact of the national standards that the Government have circulated for consultation in the draft consultation document "Fit for the Future?".

We accept the need for minimum standards, which are a central feature of the Bill and the structure that the Government are putting in place. However, standards must not simply be aspirations: they must be deliverable, and the question of cost must be addressed. We have repeatedly asked the Government whether they accept that higher quality equals high cost and that that cost must be paid for. Do they recognise that the great majority of those in nursing and care homes are paid for by the state and the public purse? Therefore, as I have asked the Minister many times, does the state accept the implications for public spending and is it ready to meet them?

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Throughout the industry, the concern is not that the Government want to raise standards--indeed, people would be delighted to operate to higher standards. The industry is concerned that the Government want to raise standards without paying the costs incurred, which will have a disastrous consequence. In the vast majority of cases, local authorities are the purchasers of this type of care. If they are not funded to meet the higher costs that these aspirations will impose, higher quality for the lucky ones will, inevitably, mean that no funding is available for others. Regrettably, the Government have consistently refused to address that point, and have not told the House or the Standing Committee whether they accept that there will be substantial costs and whether they are prepared to meet them in the case of those whose funding is met from the public purse. If the Government can reassure providers about that, many concerns will, at least, be diminished and, in some cases, will melt away completely.

We cannot look at the matter in a vacuum. The new higher standards in "Fit for the Future?" are being introduced against a background of tight finances for providers in the care home and nursing home market. They are dealing with the consequences of the national minimum wage--which has an impact in some areas, but not in others--the working time directive and other elements of the Government's social and employment legislation that have involved significant costs. They work in an environment in which, to a great extent, they face cost inflation of the type faced by the NHS, which is significantly higher than general inflation in the economy. In particular, wage and pay increases for NHS personnel, however welcome, have an inevitable consequence for competing employers in the private sector who provide services to publicly funded residents in nursing and care homes.

For many years, in many, if not most, parts of the country, providers of such care have faced below-inflation fee increases from local authorities that, with the best will in the world, cannot be more generous because their finances are too squeezed.

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