Select Committee on Public Administration Appendices to the Minutes of Evidence


Memorandum by the NHS Alliance (PAP 63)

INTRODUCTION

  1.  The NHS Alliance welcomes the opportunity to provide evidence to the Public Administration Committee's enquiry into patronage and public appointments, focusing particularly upon the reforms recently introduced in the system of appointments to the NHS Primary Care bodies.

ORGANISATION

  2.  The NHS Alliance is the independent body that represents NHS primary care. Some 90% of Primary Care Trusts (PCTs) are members, together with individuals who work in primary care. It brings together the combined force of clinicians (including GPs, nurses and allied professionals), managers and the lay people who serve on Primary Care Trust boards. It is concerned to encourage and enable a genuine partnership between these three groups within the NHS, and between the NHS and the public. The Alliance is widely recognised as the major independent voice of primary care. It has strong links with government and the Department of Health.

  3.  The National Association of Lay People in Primary Care voted earlier this year to amalgamate with the NHS Alliance. Many members of the NALPPC were also members of the NHS Alliance, either as individuals or through the membership of their PCT. That group of former NALPPC members now forms the NHS Alliance Lay Members' Reference Group, sitting alongside other special interest reference groups.

THE SYSTEM FOR MAKING APPOINTMENTS TO THE BOARDS OF PRIMARY CARE TRUSTS

  4.  The NHS Alliance supports the system for making appointments to the Boards of NHS Primary Care Trusts put in place by the NHS Appointments Commission (NHSAC). It has introduced reforms that have brought much needed transparency and fairness into the process. The system now has much in common with that generally used in human resources recruitment and so is easily understood and accepted by applicants and the public. The advertising of all posts, although costly, is valuable in reaching out to the broadest possible range of candidates. In particular, the Alliance applauds the decision to abandon the previous generic lists and to introduce a system of appointing to specific roles.

  5.  There are proposals to change the current criteria from a knowledge and skills base to a competencies base. That too, is a move the NHS Alliance supports. We believe it will assist in broadening the diversity of applicants to positions on Primary Care Trust Boards.

  6.  Nevertheless, the Alliance has identified tensions between Primary Care Trusts and the NHS Appointments Commission. There are some concerns about the practical operation of the reforms to the appointments system. We would wish to highlight the following key issues.

    —  Primary Care Trust chairs and non-executives strongly oppose NHS Appointments Commission proposals to reduce the time commitment required of PCT non-executives. They advise that it would not be feasible to carry out the tasks required of non-executives if these proposals were implemented. In particular, the role of non-executives in challenging as well as supporting management and clinicians is valuable and would be put at risk if the NHSAC proposal were adopted.

    —  Associated with this proposal, the NHSAC has stated that PCT non-executives are "executised". To the best of our knowledge, the Commission has no evidence to support this contention.

    —  It would not be acceptable to reduce the official time commitment required of non-executives but then expect them to "volunteer" to give more time, as NHSAC Chair Sir William Wells suggested at the Alliance conference (18 October 2002) and, we understand, on other occasions.

    —  More work needs to be done to establish the best means of improving the diversity of applicants and appointments.

    —  There are concerns about accountability and the roles of the NHS Appointments Commission and Strategic Health Authorities in the performance management of non-executives.

    —  There are concerns about the quality of training provided by the NHS Appointments Commission.

    —  There are concerns about the efficiency of the appointments process.

THE VIEWS OF PCT BOARD CHAIRS AND NON-EXECUTIVES

  7.  In October 2002, the NHS Alliance carried out a survey of Primary Care Trust chairs and non-executives. The full survey report is annexed to this document.

  8.  Briefly, the survey found widespread disagreement with the NHS Appointments Commission proposal to reduce the time commitment required of PCT non- executives. Almost one in four (78%) said they would not be able to maintain their roles and responsibilities within the proposed 2.5 days per month. Nine out of 10 (90%) also said it was wrong to claim non-executives had become "executised" and 95% said there should be full consultation before reaching a decision on any proposed changes to PCT management arrangements. Chairs and non-executives also said that their role was not similar either to that of company directors or charity trustees: 80% said they have a new role that includes challenging orthodoxies.

THE VIEWS OF PCT CHIEF EXECUTIVES AND CLINICAL CHAIRS

  9.  A smaller sample (25% of PCTs) of chief executives and Professional & Executive Committee chairs demonstrated similar views. 86% said that the overall contribution of non-executives was valuable (57% very valuable); 73% said their independence was not compromised by involvement in committees, working groups or functional areas (so-called "executisation"); 75% said it would not benefit PCTs to reduce the time commitment of non-executives to 2.5 days.

DIVERSITY

  10.  The NHS Alliance would welcome means of improving the diversity of appointments to PCT Boards but does not accept that reducing the time commitment required of non-executives would achieve the desired result. Our survey found that 63% of PCT chairs and non-executives believed reducing the time commitment would not assist in recruiting more younger employed people and people from ethnic minorities. Work (and often family) pressures mean that public service is difficult for this group. A similar experiment in the 1980s, linked with local government and supported by the CBI, was not successful. Nor was a more recent attempt to recruit younger employed people as lay magistrates (offering a shorter working month). It is difficult to see the link between reduced commitment and ethnic minorities.

  11.  The means adopted must take into account the responsibilities and duties of the role. In fact, the duties of non-executives are expanding rather than contracting, for example under the National Service Framework for Older People, the Working Lives Pledge and the Mental Health Act.

  12.  First steps in establishing means of improving diversity must include consultation with relevant bodies such as PCTs themselves and those concerned with disabled people, carers, women and other groups, as well as with the CBI and Institute of Directors, who have already been consulted. It is unlikely that either diversity in appointments or the success of NHS modernisation can be achieved by ignoring or riding roughshod over the groups most closely concerned.

  13.  Increasing the remuneration paid to non-executives so that it becomes a viable source of income would probably assist in recruiting from poorly represented groups. However, we understand that the Secretary of State for Health does not intend to amend this. Nor is pay the principal motivating factor. As one non-executive said: "We do this because the NHS deserves it."

  14.  The NHS Alliance proposes two means of improving the diversity of appointments. First is a relaxation of the current criteria regarding previous experience in health. We should be prepared to make more appointments based on potential rather than actual experience. Secondly, there should be more effort to improve public awareness and understanding of public service in the NHS. For example, as well as the conventional press advertising that already takes place, alternative media such as bus, tube, local radio and cinema advertising should be considered. That should be supported by a public information campaign that might include literature made available at supermarkets and pubs as well as the more conventional outlets such as health centres and public libraries. In addition, local and regional news media should be kept fully informed of the work carried out by PCT Boards and other bodies. At present, public awareness is limited. It is clearly unrealistic to expect improvements in the diversity of appointments without improving public knowledge of the opportunities.

ACCOUNTABILITY AND THE ROLE OF THE NHSAC IN THE PERFORMANCE MANAGEMENT OF NON-EXECUTIVES

  15.  The NHS Appointments Commission has the sole power to hire and fire NHS chairs and non-executives. Yet Boards are accountable to the Secretary of State through Strategic Health Authorities for the performance of their PCTs. The NHSAC itself has no responsibility for the delivery of healthcare and has limited understanding of the work undertaken by PCTs.

  16.  As a result, there is confusion and a lack of clarity about the respective roles of the NHSAC and the Strategic Health Authorities in the performance management of PCT non-executives, and whether both are looking at the same demands and evidence. The NHS Alliance detects some lack of confidence among PCT chairs in the appraisal process. There is a need to resolve these issues.

  17.  The new appointments system doubtless brings with it many advantages. However it does vest considerable power in unelected individuals who have no responsibility or accountability for the work carried out by the public bodies to which they appoint. That is bound to result in tensions. There may be a need to examine the operation of the new system further.

  18.  There have also been questions about the relationships between Strategic Health Authorities and PCTs. These are to be addressed in a joint report currently being prepared by the Prime Minister's Office for Public Sector Reform, the Department of Health and the NHS Alliance. That report is due to be published late December 2002.

THE TRAINING PROVIDED BY THE NHS APPOINTMENTS COMMISSION

  19.  The NHSAC levies an annual charge on PCTs for training. It has produced an excellent induction pack, but its basic induction training is, at best, patchy. There has been dissatisfaction with the quality of other training it has provided and concern at the overlap with training provided by Strategic Health Authorities and the Modernisation Agency. Some PCT chairs have demanded action to improve co-ordination between these different bodies. It is unclear what professional expertise in training exists within the NHSAC. The role of the Appointments Commission in training non-executives needs further examination.

THE EFFICIENCY OF THE APPOINTMENTS PROCESS

  20.  While the Alliance has not undertaken a study of the process, we have received reports of lengthy delays and confusion in making appointments. We believe there is a need to examine further the system's effectiveness and efficiency.

November 2002

Annex

Survey of PCT non-executive directors

  In his latest round of national Roadshows NHS Appointments Commission Chair Sir William Wells told delegates that he is considering significant changes to the time commitment and role of Non-Executive Directors in Health Organisations. After consulting the CBI and the Institute of Directors, although not PCTs, he proposed to revise the time commitment from 5 days per month to 2.5 days, so as to encourage the recruitment of younger employed people and ethnic minorities. He also suggested NEDs had become inappropriately "executivised" by involvement in committees, working groups and functional areas.

  A number of Primary Care Trust Chairs and Non-Executive Directors (NEDs) contacted the NHS Alliance to say they were dismayed by the implications of these statements. In view of the concerns expressed, the Alliance carried out a rapid e-mail survey to establish the opinions of PCT Chairs and NEDs on the issues Sir William had raised.

  The Appointments Commission did not provide any written material to support Sir William's speeches. Consequently the Alliance has been obliged to rely on reports from members of the messages he gave, in slightly different words, at fourteen meetings called by the Appointments Commission and attended by Chairs and Non-Executives across the country.

  The survey consisted of a short questionnaire e-mailed to Primary Care Trust chairs, with a request to forward it to their non-executive colleagues.

RESPONSES WERE RECEIVED FROM 308 PCT CHAIRS AND NON-EXECUTIVE DIRECTORS:

    —  Of these, 24% were PCT Board chairs and 71% NEDs (5% unknown)

    —  78% said NEDs could not maintain their roles and responsibilities if their time commitment was reduced from 5 days per month to 2.5 days.

    —  14% agreed that they could maintain their role if their time commitment was reduced.

    —  95% believed that any proposed changes to PCT management arrangements should be subject to full consultation.

    —  63% said reducing the time commitment would not be helpful in recruiting younger employed people and representatives from ethnic minorities.

    —  90% said NEDs were not compromised in their independence and ability to challenge decisions by involvement in functional areas, or by acting as chairs or leads of working groups and/or committees (80% "not at all" and 9% "to a small extent").

    —  80% felt that PCT NEDs were not equivalent to either non-executive directors of private sector companies nor to charity trustees: they had a new role that includes challenging orthodoxies.

  In addition to completing the questionnaire, 76 respondents added comments. Many had attended the Appointments Commission roadshows and had heard Sir William speak. Common themes emerging from this correspondence are:

    —  Deep hurt at what is seen as "trivialisation" or "denigration" of NED's role and their level of commitment, and complaints that Sir William's statements are "demoralising".

    —  The proposal to revise the time commitment of NEDs reveals a "lack of understanding" of the nature of the role and the complexity of the tasks faced by PCT Boards.

    —  Accountability requires thorough knowledge and understanding of PCTs' obligations and activities: this would be impossible to achieve with a time commitment of 2.5 days per month.

    —  Warnings that the NHS should avoid the mistakes made by ENRON and WorldCom.

    —  A number of NEDs with professional expertise in recruitment expressed disbelief that a revised time commitment would impact on recruitment.

    —  The rate of pay is more significant for recruitment.

    —  However, others felt pay is not a motivating factor: "We do this because the NHS deserves it".

    —  The majority of NEDs are well aware of the need for objectivity and avoidance of direct involvement in day to day management.

    —  There was a strong view that full consultation on any proposed changes would be essential and that no evidence had been presented to support the Commission's criticisms.

  At best, these results suggest the Appointments Commission and its PCT constituency are not entirely in tune with one another. That must be a matter for concern. Primary Care Trusts are young organisations, many less than a year old. They are still evolving and these differences cannot assist their development.

  The NHS Alliance and its Lay Reference Group believe immediate steps are necessary to resolve the concerns highlighted by this survey and have sought an early meeting with Sir William to consider the matter further. They have also called for:

    —  A moratorium on any changes or announcements on non-executive roles prior to full consultation and further evidence.

    —  The publication of any evidence on which the Commission has based its views.

    —  An independent report, perhaps along the lines of the recent HMSC report on clinician involvement, exploring the role, responsibilities, and the value to the NHS and its patients, of the lay members (non executives) of PCTs.

  Appendix 1 provides tables giving the full survey results. A selection of respondents' comments is attached at Appendix 2. As near as possible, these reflect the overall views expressed. As in all NHS Alliance surveys, respondents were guaranteed anonymity. Neither individuals nor their organisations are identified.

NHS Alliance

October 2002

APPENDIX 1

NHS ALLIANCE SURVEY OF PCT CHAIRS AND NON-EXECUTIVE BOARD MEMBERS: RESULTS
No %
1.  In your opinion, would non-executive directors (NEDs) be able to maintain their roles and responsibilities if the time commitment was revised from its present 5 days per month down to 2.5 days per month? Yes
No
Unsure
42
239
24
14
78
8
2.  The reason given for reducing the time commitment of NEDs is that it would allow the recruitment of more younger, employed people and more people from ethnic minorities. In your opinion, how helpful in practice would this move be in recruiting from those groups? Very helpful
Fairly helpful
Not very helpful
Not helpful at all
Don't know
36
63
127
66
16
12
20
41
22
5
3.  In your own PCT, are functional areas allocated to NEDs, and/or do NEDs lead or chair working groups or committees? Functional areas allocated to NEDs
NEDs lead/chair groups or committees
None of these

204

268
3

66

87
1
4.  In your experience, do these roles in any way compromise the independence and ability to challenge decisions required of PCT non-executive directors? Definitely compromised
Compromised to some extent
Compromised to a small extent
Not compromised at all
Don't know
3
18
28
248
5
1
6
9
81
2
5.  In your opinion, which of the following descriptions best applies to the role of PCT NEDs? Equivalent to NEDs of private companies
Equivalent to charity trustees
New role: includes challenging orthodoxies

40
29

247

13
9

80
6.  How important is it that any proposed changes to PCT management arrangements should be subject to full consultation? Very important
Fairly important
Not very important
Not important at all
274
19
8
2
89
6
3
1

7.  e-mail: PCT chair 75 24%PCT NED218 71

  Total number of replies received: 308.

  Number of respondents who provided additional comments: 76.

APPENDIX 2

Comments from PCT Chairs and non-executive directors

  All the NEDs that I work with in my PCT, and the NEDs from other Trusts in the local health economy, feel passionately about their role and are totally committed to the NHS and to improving services for patients. To suggest that 2.5 days per month is adequate to fulfil the requirements of a NED's job description is ill judged and trivialises the work that NEDs undertake with commitment and enthusiasm.

  Most non-execs do far more than they are paid to do, and to reduce them to less paid time would be an insult. Nor does this mean, as Sir William has suggested, that they have become "executivised". I would argue—and did, at the meeting with him—that they can be knowledgeable and well informed without losing their ability to challenge and take an independent view.

  The role of NEDs in the corporate world has been brought seriously into question following ENRON and WorldCom. The NHS should steer very clear of the dangers of going down the same route of NEDs giving insufficient time to bring genuine questioning to bear on the Executive.

  I suggest he [Sir William Wells] recognises that to advertise the task as being capable of being performed in what is probably 50% of the present commitment will be not only misleading but in the longer term counter-productive.

  Sir William claimed that a re-focus of Non-Executive priorities is required to curb the growing tendency for the Non-Exec role to become "executivised", and the independence and ability to challenge therefore compromised. Sir William cited no evidence other than hear-say and his proposals do not have the weight of a study or consultation behind them.

  There appears to be considerable tension in reducing the time spent by non execs in their role and the ever increasing Government expectations on them. Two examples:

    —  Under the NSF for Older People there is a requirement to appoint a non-executive champion and that a non-executive director is involved in the role of Local Scrutiny Groups in Rooting out Age Discrimination (Standard 1). To do any justice to this role demands time.

    —  The Improving Working Lives Pledge also requires the nomination of a non-executive (as indeed do many other areas, such as the role of Complaints Convenor).

  If we are to perform the roles envisaged under SAGE, we need to understand our organisation and be aware of what it is or is not doing. Not only does this require our involvement at Board Meetings, Audit &/or Remuneration Committees—but considerable reading to support our ability to have the necessary overview which will enable us to contribute to the strategic direction of the PCT. In my view 2.5 days is not sufficient.

  I am dismayed at the lack of understanding of what non execs are doing on the ground—and any attempt to find out. The reduction of time was to "solve" two problems—one was recruitment of younger "thrusters" from industry who were presumed thereby to improve their career profile. [There is] no real evidence that CBI or IOD can deliver—they did not with local government in the 1980s and times are tighter. The second was the presumed executivisation of non execs. On that, the assumption was unevidenced, but it was assumed that non execs playing their current PCT role couldn't challenge effectively. In my judgement they are not in general being "executivised", but their new role actually enables them to challenge earlier and more effectively

  I strongly resented Sir William's attitude and profoundly disagreed with his comments . . .[they were] at best demoralising and at worst insulting. . . I came to that event prepared to be inspired and motivated. I left dispirited and demoralised, and with a realisation that that those who planned and executed the seminar were unskilled and unprofessional. I am now determined to do all I can to protect and support our national health service from such people.

  I am greatly perturbed at Sir William Well's proposed changes. PCT's are in their infancy and need time to settle down before any changes are considered.

  I have looked at the amount of recorded time I have spent over the last 15 months, and it comes to an average of 40 hours a month if travel is taken into account—and there can be quite a lot of travelling around the patch.

  Far from reducing the amount of time expected (and remunerated?) from NEDs, it should be increased. The notion that someone in full time work but without the freedom to plan their own time could undertake the job is not reasonable. Apart from meetings in normal working time, things like sitting on appointments panels, acting as complaints convener and performing the managerial functions in relation to the Mental Health Act, all require one to be available during the normal working day.

  There is no evidence that the quality of Non Executives so far appointed is insufficient for their task. Nor that reducing the number of hours for the role will increase appointments from poorly represented groups. The best way to achieve the latter is probably to increase the remuneration for the role as a whole so that it becomes a viable source of income.

  I cannot understand the logic linking ethnic minorities with less commitment.

  As Sir William Wells presented this to the South West NEDs, the purpose is to widen the diversity of NEDs. However the proposed route was to enable employers to offer paid time . . . I can only see the main impact of this as allowing more white middle class employed men to apply . . . Where is the strategy to draw in more women, more ethnic minorities, more disabled people, carers, people at home with young families?

  The policy is broadly welcome in my view, it might encourage companies to allow staff do do this within their paid employment or to allow time off for this role. However, the "pay" is equally important, I believe. Another approach might be to make the NED role into a really decent part time job—this would be particularly attractive to women who might be prepared to sacrifice a larger salary and high flying job for more local, rewarding work with child-friendly hours.

  I feel there is very little hope that you can recruit employed people in today's work climate and ethic. Unless Non-Execs are only to be required at a Board Meeting which possibly could be set at the same time every month in the evening, taking time off work is almost an impossibility for most people, especially as most of the meetings/committees that we are involved with can be any time of the day.

  I warmly applaud the statement that we should not be drawn into the executive role and that we should be more strategic, but feel . . . this is very difficult to achieve. No business person would start a new business saddled with the debt we have inherited. We were effectively bankrupt before we started, and have continued to firefight ever since, thus taking our efforts away from development of new or improved services. The prescribing budget is proving to be a nightmare, and the more the Government tell everyone they should get what they ask for, the more this rises. We were effectively told to increase considerably the salaries to our Chief Executives, at a level which meant we had to cut back again on recruitment further down the line. . . SHA's have been set up and appear to be growing like Topsy, and are recruiting at inflated salaries, at our cost, both financially and ability to get staff.


 
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