In 2004, a new type of NHS organisation was establishedthe NHS foundation trustwhich was to benefit from a greater degree of financial and management freedom and different arrangements to improve local accountability. Since then, over 100 NHS trusts have successfully undergone the application process.
Before foundation trusts (FTs) were established, there was considerable debate about whether the supposed benefits of these new trusts would materialise and about what the impact of these trusts would be on the wider NHS. Since surprisingly little systematic and objective evaluation of FTs' performance has been carried out, we decided to hold a one-off evidence session on FTs and their regulator, and to publish a short report on our findings.
FTs have some proven strengths. They have performed well financially and generated surpluses. They have been high performers in routine NHS process quality measures. However, much is unknown. It is not clear whether their high-performance is the result of their changed status, or simply a continuation of long term trends, since the best trusts have become FTs. Key aims of FTs were the promotion of innovation and greater public involvement. While we were provided with examples of good practice in both of these areas, again there was a lack of objective evidence. We therefore recommend that the Government commission research to assess all aspects of FTs' performance objectively so that best practice can be shared with other FTs, and with the NHS more widely.
It seems that some of the fears about FTs' impact on local health economies have not been borne out; however, they have made little contribution towards the Government's aim of delivering more NHS care outside hospitals with the interesting exception of mental health trusts. This situation is not solely attributable to FTs themselves; rather it is a consequence of the introduction of Payment by Results and inadequate collaboration between PCTs and FTs to manage demand for acute care. FTs' slowness to innovate and invest was ascribed by many to failure on the part of PCTs to provide strategic guidance. The Government is clearly aware of these deficiencies and has announced plans to strengthen PCTs' commissioning skills through its World Class Commissioning programme; however, it is unfortunate that this has come after the establishment of powerful FTs in the acute sector and not before.
While FTs do not appear to have yet exploited the full potential of their autonomy, witnesses from FTs told us that the ability to make decisions more quickly was important and made a 'tangible' difference to the dynamic of their organisations, which we welcome. Unfortunately, concerns persist about what level of Government intervention in FTs' affairs is legitimate, and the Government must clarify what the appropriate levels of intervention are.
Finally, Monitor's application process and regulatory regime seems to be well regarded. However, a complex regulatory environment of other organisations also surrounds FTs, and in particular there is potential duplication between the Healthcare Commission and Monitor both of which evaluate the quality of FTs' services.