Clause 168: Appointments to certain health and social care bodies

404.     Clause 168 makes provision in respect of appointments to certain health and social care bodies. The Secretary of State currently has the power, under section 16D of the 1977 Act, to direct a SHA to undertake any of his functions relating to the health service that he specifies in directions. Pursuant to this power, the Secretary of State currently directs the National Health Service Appointments Commission (the 'NHSAC'), a SHA established under section 11 of the 1977 Act, to exercise his powers of appointment in relation to many bodies that have functions within the health service.

405.     The power to direct the NHSAC to undertake a function of the Secretary of State of making appointments is currently limited to bodies whose functions fall within the meaning of the 'health service' in the 1977 Act. Because of this limitation, specific provision was made in the 2002 Act for the Secretary of State to direct a Special Health Authority to exercise his function of appointing members to certain bodies, including, for example, the Council for the Regulation of Health Care Professionals.

406.     Subsections (1), (2) and (3) enable the Secretary of State to direct a SHA to exercise the function of appointing persons to any body (whether or not established in legislation) that has functions relating to health, social care, or the regulation of professions associated with health or social care. The Government intention is for this role to be delegated to the NHSAC.

407.     Subsections (4) and (5) make provision for the extent of the relevant provisions of the 1977 Act where the Secretary of State delegates an appointments function to the SHA in respect of appointments to a body that has functions in the United Kingdom.

408.     Subsection (6) provides for what is meant by 'appointments function', and subsection (7) provides that if a body has other functions falling outside those specified in subsection (1), this does not prevent the Secretary of State from delegating the appointments function to the SHA.

409.     Subsection (8) introduces Schedule 11 that amends the Pharmacy Act 1954, the Medical Act 1983, the Dentists Act 1984, the Opticians Act 1989, the Osteopaths Act 1993, the Chiropractors Act 1994, the Nursing and Midwifery Order 2001 and the Health Professions Order 2001. The effect of these amendments is to allow the Privy Council to direct a SHA to undertake its function of appointing members to the regulatory bodies established by those enactments, together with any function that the Privy Council has in removing members. The Privy Council may only so direct an SHA, if the Secretary of State has exercised his power of direction under the section.

410.     In respect of the Medical Act 1983 and the Dentists Act 1984, further provision is made for the appointments functions currently made by Her Majesty on the advice of Her Privy Council, to be conferred on the Privy Council: this is consistent with provision made in the Pharmacy Act 1954, the Opticians Act 1989, the Osteopaths Act 1993, the Chiropractors Act 1994, the Nursing and Midwifery Order 2001 and the Health Professions Order 2001.

Clause 169: Appointments to certain health and social care bodies: joint functions

411.     Where there is a requirement for a Minister of the Crown to make appointments to certain health and social care bodies jointly or concurrently with another person, for example with the Northern Ireland Ministers or the Assembly, subsections (1) and (2) together provide that the Secretary of State may in these circumstances direct a SHA to undertake the appointments function, but only if he first consults the other person. Subsection (3) provides that if a direction is given in respect of an appointments function that has to be exercised jointly or concurrently, that function is exercisable by the SHA acting alone.

412.     Subsection (4) provides that subsections (2) and (3) do not apply to any appointments to be made jointly or concurrently with the Scottish Ministers: the Secretary of State may, in these circumstances, only give a direction to the SHA in relation to any function he has. Subsection (5) provides that "appointments function" has the same meaning as in clause 168.

Clause 170: Validity of clearance for employment in certain NHS posts

413.     Section 7 of the Protection of Children Act 1999 requires that before a person can be appointed to a child-care position, a check must be made against the Protection of Children Act List. The List is maintained by the Secretary of State and checks against it are made through the Criminal Records Bureau which will charge £12 for a criminal record check, which will include a check against the PoCA List wherever appropriate.

414.     The Act provides for an easement to this rule in cases where the person has been supplied by an employment agency or business. In such cases, it is sufficient for the employer to satisfy himself that the List has been checked within the last 12 months by the employment agency or business. This provision was included to avoid the need for checks against the List for the same person to be repeated at very frequent intervals. Normally, once a check has been made on appointment to a child-care position, there is no requirement for it to be repeated while the person remains in that child-care position.

415.     In the majority of cases, the persons supplied for temporary work by agencies are also employed permanently in the NHS - often in the same Trust where they do the agency work. Increasingly, temporary workers will be supplied by NHS Professionals, the NHS's own "in-house" agency, which is set to become the main provider of temporary staff of all kinds in the NHS. In circumstances where a person is supplied by an agency (which may include NHS Professionals) and has substantive employment with the NHS and has previously been checked against the List, it is felt that an annual check, while being a costly overhead on the operations of NHS Professionals and other agencies, will add nothing to the safety of children. Thus Subsection (1) of clause 170 inserts new subsections 3A, 3B and 3C into Section 7 of the Protection of Children Act 1999 which have the effect of disapplying the requirement to check against the Protection of Children Act List where a person is offered employment in a child care position and certain conditions are met. These conditions are that at the time the offer of employment is made, the person concerned is already employed by an NHS body (as defined) and that NHS body (or another NHS body) has ascertained that he is not on the List. In addition, he must not have been placed on the list subsequently and, if he accepts the offer of employment, he must not be placed on the List for the duration of the employment to which the offer relates.

416.     Part VII of the CSA 2000 provides for the Secretary of State to maintain a List of persons who are considered unsuitable to work with vulnerable adults (the POVA List). Once the POVA List is introduced, before a person can be appointed to a position caring for vulnerable adults ("a care position"), a check will need to be made against the POVA List. Checks against this POVA List will again be carried out through the mechanism of the CRB. The POVA List will (when it is introduced) work in a very similar way to the Protection of Children Act List referred to above. For this reason, the amendments made by subsection (2) to section 89 of the CSA 2000 mirror those made to the Protection of Children Act 1999.

417.     Subsection (3) is a transitory provision and is needed because the amendments made to the Protection of Children Act 1999 by paragraph 121 of Schedule 21 to the Education Act 2002 are not yet in force.

Clause 171: Loans by Secretary of State to NHS trusts

418.     This clause provides that the Secretary of State may make loans to NHS trusts without the consent of Treasury in the same way that clause 11 provides for him to make loans to NHS foundation trusts.

PART 6 - FINAL PROVISIONS

Clause 177: Commencement

419.     Clause 177 provides that all of the Bill provisions may come into force on such days as the appropriate authority in each case may appoint by order, except for those order or regulation making powers which will come into force on Royal Assent. Subsection (2) gives the meaning of 'appropriate authority' in relation to the provisions of each Part of the Bill.

ESTIMATE OF PUBLIC SECTOR FINANCIAL EFFECTS AND PUBLIC SECTOR MANPOWER EFFECTS

Part 1 - NHS Foundation Trusts

420.     In clauses 1 to 35 the setting up of an independent regulator to authorise NHS foundation trusts, issue terms to their authorisation, and monitor compliance will entail some costs and a staff requirement. The extent of these costs and the number of additional staff required will depend on the number of NHS foundation trusts. It is estimated that the running costs will be £2.3m in the first full financial year (2004/5). As more NHS Trusts make the transition to NHS Foundation Trusts, Department of Health and Strategic Health Authorities' running costs will decrease. The functions of the Independent Regulator and Strategic Health Authorities will exist in parallel during the transition phase.

421.     Modest start-up costs are likely to be incurred by those seeking NHS foundation trust status. The Secretary of State will have the power to give grants to NHS foundation trusts as he currently does for NHS trusts.

Part 2 - Quality and Standards

422.     The new health inspectorate, CHAI, and the inspectorate for social care, the CSCI, outlined in clauses 36 to 136 will respectively replace the CHI and NCSC. There will be set up costs for each body, estimated up to £15m for CHAI and £7m for CSCI. This money has already been allocated to the Department. Estimated running costs for CHAI are £60 million and £143 million for CSCI. It is anticipated that staff from the current bodies will transfer to the new bodies being created.

423.     With regard to the National Assembly for Wales, no extra costs are expected to arise from the establishment of the new Assembly healthcare unit. The costs of the new arrangements (i.e. the costs of the new healthcare unit and the payments to CHAI for its services) is not expected to exceed the Assembly's current annual expenditure of £2 million on comparable functions (from which part is currently used for the Commission for Health Improvement). In respect of social care functions in Wales, no changes to structures will be made and any additional costs will be minimal a proportion of the funds.

Part 3 - Recovery of NHS charges

424.     The provisions in clauses 137 to 156 about the recovery of NHS costs would recover costs for the NHS in addition to those already collected currently following road traffic accidents. Clause 149 requires the Secretary of State to pay NHS charges recovered to the NHS trust or other body responsible for the hospital. This ensures that any funding raised is protected for the provision of services to benefit the patients receiving NHS treatment. It is intended that the scheme will be administered by the Compensation Recovery Unit (CRU), a Department of Work and Pensions body, which currently administers the road traffic scheme. The Department of Health currently pays CRU £1.9 million (for 2002/03) for administering the road traffic scheme. Under the expanded scheme, it is estimated that CRU will be handling a further 30% more claims. Running costs, including staff costs, are expected to be around £1 million more than the £1.9 million for the road traffic recovery scheme. These costs will be offset by the generation of in the region of £150m in Great Britain per year - this is based on the road traffic accident scheme's tariff of costs.

Part 4 - Dental services

425.     The implementation of the new primary dental services provisions (clauses 157 to 166) is expected to take place over a 2 to 3 year period. PCTs are to be given new duties to provide, or secure the provision of primary dental services. There will be small cost implications for PCTs whose role it will be to agree contracts with dental practices and review these contracts in successive years. These costs are as yet unquantifiable, but are expected to be modest. It is not expected that in themselves the new contracts will lead to a requirement for extra Government funding beyond that already used for the provision of these dental services.

426.     The Dental Practice Board for England and Wales is responsible for verification of payment claims and making payments to around 18,000 dentists and has running costs of over £20 million per year. Assets, liabilities and staff (subject to consultation) of the DPB (clause 163) are intended to be transferred to its successor body, a Special Health Authority established under s11 of the 1977 Act.

427.     The successor SHA will have similar responsibilities in relation to primary dental services, but in relation to approximately 9,000 practice based new GDS contracts.

Part 5 - Miscellaneous

428.     The replacement of the Welfare Food Scheme (clause 167) will be met from the same sources as the current scheme. Currently £142 million is paid from the Department of Health Vote (which bears all of administration costs for the scheme), £14 million from the Scottish Executive and £9 million from the Assembly. The total cost of the Welfare Food Scheme, therefore, is in the region of £165 million. The replacement scheme is not expected to cost more than the current scheme.

SUMMARY OF REGULATORY APPRAISAL

429.     Department of Health officials have consulted the Cabinet Office, the Small Business Service, the devolved administrations and key stakeholders over development of the Bill's Regulatory Impact Assessments ('RIAs'). The majority of these measures will have minimal impact on businesses and voluntary organisations. The two proposals which are likely to have any impact will be those for introducing recovery of NHS treatment and ambulance costs where people claim and receive compensation for injuries and those for proposals to replace the Welfare Food Scheme, and a summary of these RIAs is set out below. Health and social care bodies are currently subject to a number of elements of regulation and assessment or inspection. The Commission for Healthcare Audit and Inspection and the Commission for Social Care Inspection will draw those elements together to provide more powerful, coherent and independent inspection arrangements. It is not anticipated that these will add to the administrative burden on private or voluntary health and social care bodies.

Recovery of NHS Costs

430.     Any business or voluntary organisation, large or small, with potential liabilities where people receive compensation as either an employer, a producer of goods or transacting business in a public place, may be affected. Insurance companies providing cover in these areas would also be affected by the administrative costs and by the need to apportion costs amongst holders of policies. Citizens may also be affected. Local Authorities and Government Departments and NHS Trusts are likely to be affected by these proposals as set out in the RIA. The estimated cost to the taxpayer of meeting these costs is approximately £150m in Great Britain per year, based on the road traffic tariff, and this is the intended amount to be recovered through the scheme.

Welfare Food Scheme

431.     The proposed scheme could have an impact on some doorstep deliverers as the scheme will no longer exclusively supply milk. Welfare food milk sales currently account for 5% of doorstep milk sales throughout GB. Figures submitted to the Department of Health by suppliers indicate that fewer than 1% of doorstep delivery businesses are dependent on the scheme for more than 7.5% of their total sales.

432.     A copy of the full Regulatory Impact Assessment of the costs and benefits that this Bill would have is available to the public from www.doh.gov.uk/regulatoryimpact/index.htm or contact Anita Sharma, Bill Team, Room 309, Richmond House, 79 Whitehall, LONDON SW1A 2NS, email: Anita.Sharma@doh.gsi.gov.uk, telephone 0207 972 5054.

EUROPEAN CONVENTION ON HUMAN RIGHTS

433.     The Department does not consider that the provisions of Part 1 of the Bill give rise to any convention issues.

434.     The Department does not consider, save for the two areas discussed here, that the main provisions of Part 2 give rise to any Convention issues. The provisions of this part give various rights to the CHAI, the CSCI and the National Assembly for Wales (NAW) to enter and inspect premises, to inspect and take copies of documents and to require information (including in certain circumstances medical information) and an explanation of information or documents obtained by the Commissions, or the Assembly in connection with the exercise of their functions under the Bill. These requirements may constitute an interference with Article 8 of the Convention (rights to private and family life). The Department is of the view that such interference is justified.

435.     These provisions of pursue a number of legitimate aims. The purpose of the powers is to enable the Commissions (or, in Wales, the NAW) to assess the performance of NHS bodies and local authorities in connection with the provision of healthcare and local authority social services monitor the safety and reliability of the services which they provide and their compliance with regulatory requirements, to assess quality standards and to ensure financial probity and that public money is being properly spent In the Department's view, the powers are proportionate. Appropriate limitations and restrictions are imposed by the Bill (in particular the Bill provides that the powers may only be exercised where this is necessary or expedient for the body to exercise the power), or by will be imposed by regulations in the case of the power to require an explanation. The Department therefore takes the view that these clauses are compatible with Article 8 of the Convention. The Department also considers, for the same reasons, that these powers are compatible with Article 1 of the First Protocol.

436.     The Department also considers that the provisions of Chapter 9 of this Part which relate to the handling of complaints relating to NHS healthcare and local authority social services comply with the requirements of Article 6 of the Convention (right to a fair trial).

437.     In relation to Part 3, the Department considers that the independent appeals system provided for in clauses 144 to 146 met the requirements of Article 6 (right to a fair trial). It also considered whether the requirement for information to be provided by compensators and others under clause 147 might be an interference with an individual's rights under Article 8 (right to respect for private and family life, home and correspondence). It is envisaged that the information obtained would be confined to factual details, such as the nature of the injury, and would not include access to confidential medical records. The Department takes the view that this is a proportionate interference necessary to the effective working of the scheme.

438.     The Department considers that the main provisions of Part 4 (dental services) do not give rise to any Convention issues. Power is provided for contracts for general dental services to make provision about entry to premises and inspection of records by the PCT. The purpose is to enable PCTs to monitor compliance with the contract and quality standards, and the proper application of funds. The Department's view is that any interference with an individual's rights under Article 8 (right to respect for private and family life) of the Convention is justified if it is proportionate to the ends of the prevention of crime and the protection of the rights and freedoms of others. The Department also takes the view that this power is compatible with Article 1 of the First Protocol (right to respect for property) as any interference strikes a fair balance between the protection of an individual's right to property and the public interest as a whole.

439.     The Department is of the view that, save for the issue arising from the provisions for the replacement of the welfare food schemes discussed below, the provisions of Part 5 do not give rise to any Convention issues.

440.     The Department considers that the power to set conditions under the new schemes to provide benefits for improving the nutrition of certain pregnant women, mothers and children (clause 167) before a person may become entitled or continue to be entitled to a benefit could engage Articles 8 (right to respect for private and family life) and 14 (prohibition of discrimination) (if the conditions affect only one part of the population) of the Convention. It is the Department's view that attendance at a hospital, clinic or doctor's surgery would be a minimal interference in a person's life and a requirement to submit to medical examination, proportionate, where evidence shows that those subject to the requirement are at greater risk of health inequalities than the population as a whole. The provisions appear to the Department to be in the public interest and to strike a fair balance between the interests of potential beneficiaries and those of the wider community. The Department therefore takes the view that these provisions are compatible with Convention rights.

441.     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). This statement has to be made before second reading. On 12 March the Secretary of State for Health made the following statement:

"In my view the provisions of the Health and Social Care (Community Health and Standards)Bill are compatible with the Convention rights."

COMMENCEMENT

442.     Clause 177 makes standard provision for commencement. The substantive provisions of the Bill will come into force on such a day, or days, as the relevant authority may determine.

ANNEX A

OUTLINE OF THE EXISTING LAW RELATING TO THE NHS

443.     The following paragraphs provide a brief description of the current legislative framework for the NHS. The legislative framework for the NHS in England and Wales is mostly set out in the National Health Service Act 1977 ("the 1977 Act"). This has been amended quite substantially by various enactments, notably by the National Health Service and Community Care Act 1990 ("the 1990 Act"), the Health Authorities Act 1995 ("the 1995 Act"), the National Health Service (Primary Care) Act 1997 ("the Primary Care Act"), the Health Act 1999 ("the Health Act"), the Health and Social Care Act 2001 ("the HSC Act") and the National Health Service Reform and Health Care Professions Act 2002 ("the NHS Reform Act").

444.     Under the 1977 Act, the NHS is essentially split into two different systems. There is first of all the system which consists primarily in the provision of health care in hospitals. It also covers those services described as "community health services", for example, the services provided by midwives or health visitors in clinics or individuals' homes, and the provision of medical services to pupils in state schools. This is the subject of Part I of the 1977 Act. The responsibility for securing the provision of these services to patients rests with the Secretary of State, although under his powers in section 16D of the 1977 Act he has delegated most of his functions to Strategic Health Authorities and PCTs. PCTs enter into arrangements with bodies known as NHS trusts for the provision by the trusts of hospital and community health services.

445.     The other main part of the NHS structure is what might be described as "the NHS in the High Street" or "family health services". This is dealt with under Part 2 of the 1977 Act. The professionals in question are general practitioners ("GPs")(i.e. family doctors), general dental practitioners ("GDPs"), ophthalmic opticians and ophthalmic medical practitioners, and chemists.

446.     The 1990 Act, the Primary Care Act, the Health Act, the HSC Act and the NHS Reform Act introduced a number of changes to these systems of health care. Broadly speaking, the changes introduced by these Acts were as follows -

• The 1990 Act introduced what is known as the internal market; by creating a divide between the planning and purchase of Part I services, on the one hand, and the provision of those services, on the other;

• the Primary Care Act in effect enabled medical and dental services to be delivered, not under Part 2, but under a more flexible system within Part I of the Act, known as 'PMS' and 'PDS';

• the Health Act made a number of changes, but in particular provided for the abolition of GP fund-holding (introduced by the 1990 Act), the establishment of Primary Care Trusts ("PCTs") (a new type of NHS body to both commission and provide NHS care) and new arrangements to improve the quality of NHS services and co-operation between NHS bodies and local authorities;

• the HSC Act also made a number of different changes, but in particular provided for changes to the funding of NHS bodies, local authority scrutiny of NHS provision, changes to the system for filling vacancies for GPs, additional lists for Part II practitioners, the abolition of the NHS tribunal, the provision of "local pharmaceutical services" (similar to the Primary Care Act arrangements for PMS/PDS), and the establishment of "Care Trusts".

• Part 1 of the NHS Reform Act provided for HAs to be renamed, in England only, as Strategic Health Authorities; for the Secretary of State to be required to establish PCTs for the whole of England and to be able to delegate his functions directly to them; and for many of the service provision functions currently directly conferred on HAs (including those relating to family health services under Part 2 of the 1977 Act) to be conferred on PCTs. In relation to Wales, the Act provides for the establishment and funding of Local Health Boards ("LHBs") and places a duty on each LHB and local authority in Wales to formulate and implement a health and well-being strategy for the area.