Clause 12: Patient redress investigators

38.     This clause requires the Secretary of State to make provision for the appointment of suitably qualified patient redress investigators who will conduct investigations (subsection (2)(a)), and produce reports on the investigation and lessons to be learnt (subsection (2)(b)). The amendment provides that investigation reports may form the basis of the explanation offered under the scheme, and the assessment of liability in tort (subsection (3)). The amendment allows for procedures for investigation to be set out in secondary legislation and for functions to be conferred on investigators (subsection (4)). It also provides for the Healthcare Commission to maintain and publish a list of approved investigators, and have responsibility for overseeing the carrying out of their functions (subsection (5)).

     Clause 13: Duties of co-operation

39.     This clause establishes a new duty of co-operation between the scheme authority (the NHSLA) and the Healthcare Commission (subsection (1)), and the scheme authority and the National Patient Safety Agency (subsection (2)). This is intended to help the scheme to operate effectively.

     Clause 14: Complaints

     40.     This clause enables the Secretary of State to make regulations providing for the handling of complaints about maladministration in the exercise of functions under, or relating to proceedings under, a scheme, or about maladministration in connection with settlement agreements under a scheme (subsection (1)). The regulations must provide for this procedure to be operated either by the scheme authority or by scheme members. The regulations may also make provision about who may make a complaint, which complaints are and are not covered by the procedure, to whom complaints are to be made, the timeframe within which complainants must receive a response, the form that a response must take, the procedure to be followed, and the action to be taken as a result (subsection (4)). The regulations may provide that the body operating the complaints procedure must make information about the procedure available to the public (subsection (5)), that different parts of a complaint may be treated differently (for example, for different procedures to apply to different aspects of a complaint) and that documents may be required to be disclosed in order for the complaint to be investigated, subject to any legislative restrictions on disclosure (for example, in the Data Protection Act 1998) (subsection (6)). The regulations may also make provision about how complaints that also fall under complaints procedures set up under other legislation, as well as the complaints procedure established under clause 14, are to be dealt with (subsection (7)). ⁶

⁶ The powers under clause 14 are similar to the powers under sections 113 and 115 of the Health and Social Care (Community Health and Standards) Act 2003 (c.43) (complaints about health care).

     41.     The regulations may also make provision for securing that complaints made in connection with the redress scheme but which fall to be considered under other statutory complaints procedures, are referred to the organisation operating those procedures, and that they be treated as if they had been raised as a complaint under those procedures (subsection (8)). Subsection (10) amends section 31(6) of the Data Protection Act 1998 so that personal data processed for the purpose of dealing with complaints under the redress scheme complaints procedure may be exempt from the subject information provisions of that Act. The subject information provisions of the Data Protection Act 1998 allow for individuals, except in certain defined circumstances, to seek and obtain information about them which is held by others. Section 31 of the Data Protection Act 1998 provides an exemption from these provisions by reference to a number of different categories of regulatory function exercised by public bodies.

     Clause 15: Remit of Health Service Commissioner for England

42.     This clause amends the Health Service Commissioners Act 1993 to broaden the remit of the Health Service Commissioner for England to include complaints relating to maladministration in relation to the exercise of functions under the scheme, in connection with a settlement agreement under the scheme or in the exercise of any functions in relation to complaints made under regulations under clause 14. The effect is to allow the Commissioner to investigate complaints about such maladministration, and to report on her findings following the investigation of such a complaint.

     Clause 16: Regulations

43.     This clause makes further provision about the Secretary of State's regulation-making powers under the Bill. In particular, the first regulations establishing a scheme (and any subsequent regulations that establish an entirely new scheme) are required to be laid before and approved by each House of Parliament before they can be made (normally referred to as the affirmative procedure) (subsection (6)). All other regulations are subject to annulment in pursuance of a resolution of either House of Parliament (normally referred to as the negative procedure) (subsection (7)): this means that such regulations can come into force without Parliamentary approval but that Parliament will have 40 days after they have been laid before Parliament to pass a resolution annulling them. If such a resolution was passed, the regulations would cease to have effect from the date of the resolution.

     Clause 17: Framework power (Wales)

44.     Clause 17 gives the National Assembly for Wales a broad power to make regulations establishing arrangements for redress in respect of Wales. The clause has its foundation in the principles set out in the Wales Office's White Paper: Better Governance for Wales ⁷, which was presented to Parliament on 15 June 2005. The White Paper contains the Government's proposals for developing the devolution settlement in Wales.

⁷ Cm 6582; see in particular paragraphs 1.24 and 3.12

45. The arrangements made under this clause may cover people with claims involving qualifying liability in tort arising out of the provision of services as part of the health service in Wales (whether those services are provided in Wales or elsewhere), and connected matters (subsection (1)). The Assembly is not under an obligation to set up a "scheme". The arrangements are not restricted to claims arising from harm caused in hospital settings. "Qualifying liability in tort" is defined more widely than in clause 1 (subsection (2)): it is not restricted to liability arising from acts or omissions on the part of healthcare professionals. The broad scope of this power is intended to allow the National Assembly for Wales to determine arrangements for redress which are most relevant to its policies and plans for the health service in Wales.

46.     Subsection (3) establishes that regulations made by the National Assembly for Wales under this clause may include any provision that could be made by an Act of Parliament, apart from those provisions identified at subsection (4). The scope of the regulation-making power is similar to the regulation-making power in section 2(2) and (4) of the European Communities Act 1972.

47.     Subsection (4) places a number of restrictions on the National Assembly for Wales in exercising its power under subsection (1). The Assembly cannot:

(a) make any provision imposing or increasing taxation;

(b) give any of the provisions in the regulations retrospective effect;

(c ) sub-delegate the power to legislate;

(d) create a new criminal offence;

(e) make provision extending otherwise than to England and Wales; or

(f) make any provision which applies to England, without the consent of the Secretary of State.

     48. Subsection (5) provides that subsection (4)(c) does not preclude the modification of a power to legislate granted otherwise that under subsection (1), nor does subsection (4)(c) preclude the extension of any such power to purposes of a like nature as those for which it was conferred.

49. Subsection (6) provides that sub-delegating a power to give directions as to matters of administration is not to be regarded as a power to legislate within the meaning of subsection (4)(c). Subsection (7) allows the National Assembly for Wales to exercise the power under subsection (1)(a) in respect only of some of the cases covered by the power, if it sees fit.

     Clause 18: Interpretation

50.     Clause 18 provides definitions for the expressions used in the substantive clauses. Some of the definitions refer to the meaning given in the National Health Service Act 1977: section 128 of that Act contains the relevant definitions.

FINANCIAL EFFECTS

51.     Clinical negligence cost the NHS over £500 million in 2004/05. The NHS Redress Scheme is expected to increase spending on compensation payments because it is expected to bring new claims into the system. However, in the longer term, savings on legal costs are expected.

52.     Departmental economists have assessed the financial implications of the redress scheme and estimate that, if regulations prescribe a maximum limit of financial compensation under the scheme of £20k, the financial effect of the scheme would, in the first year, range between an overall saving of £7m (where only small increases in claims were seen) and a projected increased cost of about £48m (if there were large increases in claims). These figures include administration costs and are dependent upon expected savings on legal fees. The annual cost or saving of the scheme will vary as the scheme develops and becomes established. Departmental modelling suggests that the projected financial effect in year ten of the scheme's operation would range between a saving of £15m (small increases in Redress claims) and an increased cost of an extra £80m (large increases in Redress claims).

53.     Departmental economists have assessed the financial implications of clause 12 (patient redress investigators), which was inserted by an opposition amendment at Report stage in the House of Lords ⁸. Their assessment is that if all cases under the scheme were subject to independent investigation by independently employed investigators, this would result in a total cost of up to £41 million in year one and that this cost would rise each year as the number of cases subject to proceedings under the scheme increased year on year. However, if an investigator were to be placed in every scheme member, with responsibility for conducting investigations, or if investigators were shared between scheme members, these costs may be reduced.

⁸ See Hansard Volume 678 No.107 Wednesday 15 February Col. No. 1175-1185.

54.     The scheme will be funded through contributions from scheme members to the scheme authority; it is envisaged that the arrangements for contributions might, for example, be similar to the arrangements for contributions to the Clinical Negligence Scheme for Trusts ⁹. There will be an increase in the overall allocations made to PCTs to reflect their increased expenditure arising from the scheme. In addition, funding will be made available from the Department of Health to the NHSLA to cover the small increases envisaged in administrative costs for operating the Redress Scheme. Departmental economists have modelled this as an annual cost of between £3.2m and £11.2m (dependent on the number of claims received).

     

⁹ See http://www.nhsla.com/Claims/Schemes/CNST/ for further information on the Clinical Negligence Scheme for Trusts (established under section 21 of the National Health Service and Community Care Act 1990 - see the National Health Service (Clinical Negligence Scheme) Regulations S.I. 1996/251).

PUBLIC SERVICE MANPOWER

55.     It is currently envisaged that the scheme will be administered locally by scheme members but with some functions undertaken by the scheme authority, including the assessment of liability and quantum, and the making of payments of financial compensation under the scheme. The allocation of manpower to the scheme would be a matter for local discretion, but we envisage that both local and national bodies will make use of staff already in place who currently deal with complaints, litigated cases of negligence, and risk management strategies, to operate the new NHS Redress Scheme. We therefore anticipate small increases in administrative costs for operating the Redress Scheme as outlined above.

     56.     Patient redress investigators under clause 12 would incur further additional costs, as the clause envisages the appointment of independent investigators to conduct investigations into the facts of all cases falling under the scheme. This cost would increase each year as the number of cases subject to proceedings under the scheme increases year on year.

SUMMARY OF THE REGULATORY IMPACT ASSESSMENT

57.     The Full Regulatory Impact Assessment can be found at www.dh.gov.uk/actsandbills. The Scheme is deregulatory in nature, as it will enable the patient to receive redress without having to go through the legal system. The Cabinet Office's Better Regulation Executive has been consulted on the development of the RIA and is content that additional deregulatory measures are not required.

58.     It is considered that the impact on the small business sector, outside legal organisations, will be insignificant.

COMMENCEMENT DATE

59.     The commencement clause (clause 19) provides that the Bill (with the exception of clauses 17 to 19) will come into force on a day appointed by order by the Secretary of State. Clause 17 will come into force on a day appointed by order made by the National Assembly for Wales. Clauses 18 and 19 will come into force on the day on which the Act is passed.

EUROPEAN CONVENTION ON HUMAN RIGHTS

60.     The Government is satisfied that the Bill is compatible with Convention rights: a number of Convention issues do however arise in relation to the Bill. These relate to

Articles 6 (right to a fair trial), 8 (right to respect for private and family life) and Article 14 (prohibition of discrimination).

61.     The Government is satisfied that the redress scheme to be established under clause 1 does not, for the purposes of Article 6, create or determine any civil rights and obligations. The redress scheme is a scheme for the resolution of claims relating to harm arising from clinical negligence in respect of NHS treatment. By virtue of clause 1(2) and (3) the redress scheme only applies to cases where there is considered to be a qualifying liability in tort; the scheme is designed to provide a basis for settling claims where such a liability is considered to arise. If an offer is not made, or is rejected, the person's right at common law to sue for negligence will remain in being, unaffected by the scheme.

62.     The NHS redress scheme will only benefit certain persons with rights to sue in tort, namely persons who have claims, worth below a set limit on financial compensation arising out of hospital treatment or other qualifying services provided or commissioned by the English NHS. The right to sue in negligence is a "possession" and decision-making under the redress scheme could fall within the ambit of Article 1 of Protocol 1 (protection of property) for the purposes of mounting a claim under Article 14 on the grounds of discrimination. However, the Government takes the view that this difference in treatment is objectively justified, has the legitimate aim of compensating those harmed by NHS treatment and who would be entitled to seek damages from the NHS, and is proportionate to that end.

63.     Clauses 10(2)(f) and 14(6), under which information or documents may be disclosed to the scheme authority or a person considering a complaint about maladministration of the scheme, could give rise to issues under Article 8 in relation to the right to respect for private life. However, any interference with that right under those clauses would be justifiable to the extent that it was for the protection of the rights of a patient or other person seeking redress under the scheme and proportionate. The powers of disclosure are subject to the restrictions in the Data Protection Act 1998, and are given to enable a body to carry out its functions which are directed at assessing either the rights of a person under the scheme or a complaint about the operation of the scheme.

     64.      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. The Secretary of State for Health Patricia Hewitt has made the following statement:

     In my view the provisions of the NHS Redress Bill are compatible with the Convention rights.