NHS Reform and Health Care Professions Bill

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Mr. Touhig: The clause places a duty on the newly formed local health boards in Wales, and on each local authority in Wales jointly to formulate and implement a health and well-being strategy for the local authority area. The clause reinforces the Assembly's commitment to joint working between the NHS and local government. In doing so, it seeks to embrace the wider stakeholder group, including the independent and voluntary sectors and others in setting the strategic agenda for health and well-being in their local areas.

The model for the health and well-being strategies emerged from the NHS plan in Wales. It is an inclusive model, which has been developed in partnership with stakeholders. Indeed, a task and finish group was created, comprising representatives of the NHS, local government, professional bodies and others, including the voluntary and independent sectors. These proposals have been brought forward as a consequence of that consultation. There has also been formal public consultation through the document ''Structural Change in the NHS in Wales'', which was published in July.

The emphasis on partnership working also derives from the joint working provisions of the Health Act 1999. The partnership provisions in sections 26 to 32 of that Act were intended to strengthen partnership working within the national health service and between the NHS and local government. Those provisions encouraged collaboration between the two statutory bodies, but did not require it. Nor did they require local authorities or NHS bodies to consult or otherwise involve external partners, such as the private and voluntary sector, in strategic or operational planning of services. Those are increasingly important elements of the overall health, well-being and care provisions in each local area. The clause is intended to redress the balance in Wales.

The development and implementation of the health and well-being strategies will ensure that all the relevant local partners are included in work on a strategic approach to the development and provision of the whole spectrum of services, from community care and primary health care to the acute sector and long-term domiciliary or residential care. Those strategies will reflect the need to tackle the underlying

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factors that lead to poor health, such as poor housing, poor education and unemployment. In so doing, they will contribute to the improvement of health services, to increased well-being and prosperity, and to a reduction in health inequalities.

The health and well-being strategy will complement the community strategies that local authorities are required to prepare under section 4 of the Local Government Act 2000. I commend the measure to the Committee.

Mr. Burns: I fully understand that the overall aim of the clause is to draw up strategies, in conjunction with local authorities and others, to enhance and improve the health of the community. Will the Minister explain what he envisages? Will there be overall strategies, or targets and aims to be reached in a specified time scale? If the latter approach has any role in the strategies, how will success be tested? How would failure to achieve the aims of the strategy be dealt with?

Mr. Touhig: It is important to recognise that the Assembly will set its overall priorities among its targets for improving health service delivery in Wales. It will establish measures for the achievement of targets and to assess the results. The Assembly will make regulations that will determine the targets and how they will be measured. As I said earlier, provision is made for local health boards to produce reports and to be open and accountable for all that they do. That will be measured not only against the Assembly's aims for the health service in Wales but against the hopes and aspirations of the local community, as represented on the local health boards.

Dr. Taylor: I strongly commend the power under clause 22(6)(a) for imposing a duty to consult, among others, community health councils, voluntary bodies and local businesses in Wales.

Question put and agreed to.

Clause 22 ordered to stand part of the Bill.

Clause 9

Funding of Local Health Boards

Question proposed, That the clause stand part of the Bill.

Mr. Touhig: Clause 9 provides for the funding of local health boards, the setting of the financial duties and the establishment of resource limits. The clause closely mirrors the existing clause 97 in the National Health Service Act 1977 for the funding of health authorities. The clause provides for local health boards to be funded by the Assembly to secure health care for their populations. It also provides for the Assembly to fund up to the amount that is allocated, and also allows for the initial allocation to be adjusted during the year. It provides for the Assembly to make payments to local health boards on their performance, based on specific objectives or criteria. The Assembly will be required to notify local health boards in advance of those criteria if additional payments are

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intended to be made on that basis. Part or all of the performance funding will be able to be withdrawn if, subsequent to the additional allocation, the local health board partially or wholly fails to satisfy the set criteria.

When determining local health board allocations, the clause allows for the Assembly to take into account the local health board's expenditure on non-cash-limited funding, which is part 2 expenditure. In addition, it provides for local health boards to pay capital charges to the Assembly and allows the Assembly to ring-fence parts of the allocation for specific purposes. As well as establishing the funding mechanism, it establishes a duty on local health boards not to exceed the sum allocated to them by the Assembly plus any other receipts. It also extends the setting of resource limits to local health boards, as provided for in the Government Resources and Accounts Act 2000. I commend the clause to the Committee.

Mr. Burns: I apologise in advance if I am displaying an excess of ignorance about the Welsh Assembly. Is there a mechanism in the Welsh Assembly so that, if it wanted to, it could provide free residential care for the people of Wales in the same way that the Scottish Parliament can for the people of Scotland?

Mr. Touhig: Yes, it has the power.

Mr. Burns: If the Welsh Assembly decided that it wished to provide free residential care in the same way as is anticipated in Scotland, it would be contrary to Government policy for England. Is there any funding mechanism that the Department of Health in London could use to restrict the money paid to the Welsh Assembly for Welsh health care because it disapproved of decisions taken by the Welsh Assembly?

Mr. Touhig: What the Welsh Assembly does on that matter is for the Welsh Assembly. The responsibilities are devolved under the Government of Wales Act 1998. The Assembly can make its own decisions and would have to find its own finances for the scheme.

Mr. Burns: The Minister says that the Assembly would have to find its own finances for such a project. Presumably, the money that the Department of Health, or the Treasury, in London gives to the Welsh Assembly to provide health care in Wales is categorised. I imagine that there are rules and regulations about what the money can be spent on. Could the Welsh Assembly spend money sent by the Treasury for health care on another non-health related spending priority? Surely the money is ring fenced in one way. Is it not the case that the Treasury provides money for health care, which the Welsh Assembly devolves throughout the Principality of Wales to provide health care?

I will round the figures to make it simple. Let us imagine that the Government give £1 billion for health care in Wales on the criteria of maintaining current provision. The Welsh Assembly decides to provide free

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residential care for the elderly next year, which, for sake of argument, costs £500 million and comes out of the health budget sent by the Treasury. The Assembly would be £500 million short to maintain the same level of health care in the Principality, and that would be a problem. If that is the logic, given that the Government in London do not agree that residential care should be provided free at taxpayers' expense out of Department of Health funds, how could we get around it?

Mr. Touhig: The hon. Gentleman will forgive me for going over what happened in 1998 when we passed the Government of Wales Act. Funding decisions for the Welsh Assembly derive from the Barnett formula and the Assembly has complete autonomy in deciding how to spend the money. Decisions to increase public spending on health will have consequential effects on the Barnett formula that carry over into Wales, but the Assembly can determine whether to use the money for health or something else. Under the devolved settlement, it is entirely within the power of the Assembly.

Question put and agreed to.

Clause 9 ordered to stand part of the Bill.

Clause 5

Local Representative Committees

3.15 pm

The Minister of State, Department of Health (Mr. John Hutton): I beg to move amendment No. 115, in page 5, line 32, leave out '(1A)' and insert '(1ZA)'.

The Chairman: With this we may take Government amendment No. 116.

Mr. Hutton: The amendments are minor and consequential. They correct minor typographical errors in subsection (9), which inserts a new subsection (1A) into section 45 of the 1977 Act. We have a slight problem because of an existing subsection (1A), so amendment No. 115 simply corrects the reference to subsection (1Z). Amendment No. 116 makes a minor and consequential change to subsection (10) in order to reflect the changes made under amendment No. 115.

Question put and agreed to.

Amendment made: No. 116, in page 5, line 43, after '(1A)' insert—

    '(a) for ''power conferred by subsection (1) above is'' there is substituted ''powers conferred by subsections (1) and (1ZA) above are'', and

    (b)'. —[Mr. Hutton.]

Clause 5, as amended, ordered to stand part of the Bill.

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Schedule 2

Reallocation of functions of health authorities to primary care trusts

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Prepared 29 November 2001