Health and Social Care Bill

Memorandum submitted by UNISON (HSR 14)


1. UNISON is the major union in the health service and social care sector. We represent more than 450,000 healthcare staff and 300,000 social care staff employed in the NHS and local government, and by private contractors, the voluntary sector and GPs. Our members care for the most vulnerable in society.

Summary and process

2. UNISON believes that the Bill remains fundamentally flawed and – based on a preliminary assessment of the new amendments – appears more convoluted than ever. UNISON’s main areas of concern remain: a vast and damaging extension of competition; abolition of the private patient income cap; and the unravelling of national structures for staff pay, bargaining, and terms and conditions. It is also increasingly clear that government claims to have brought back the responsibility of the Secretary of State for the NHS are not true. UNISON continues to believe that goals such as increasing clinician involvement and providing a greater say for patients could be achieved by other means.

3. UNISON is also concerned about the process. To begin with, only 64 of the Bill’s 299 Clauses are being recommitted to the Committee, despite the huge amount of criticism and debate around the Bill. The latest government amendments to the Bill were only published three days before the oral evidence sessions at the Committee, and there are 181 of them. The latest Briefing Notes appeared the day before this first session of Committee and we do not yet have a revised Impact Assessment at all. This leaves virtually no time for an adequate assessment of the changes to the Bill. This will inhibit proper scrutiny of the re-committed Bill, undermining the whole point of the government’s "listening exercise".

4. There are many issues that the government has ignored completely in its changes to the Bill. UNISON’s submission is therefore obliged to focus in the main on those areas that the Committee is being allowed to debate again. But this does not detract from the seriousness of problems in the following areas:

· the use of a commercial insolvency regime meaning that wards, units or entire hospitals could be forced to shut or sold off to other providers;

· the continuation, albeit in delayed form, of the Any Qualified Provider (AQP) policy that, although not in the Bill itself, underlies many of the changes and will have a big impact on services and staff;

· t he failure t o retain national workforce structures for terms and cond itions, pay and bargaining;

· the plan to abolish the private patient income cap .

The latter is of particular concern, the more so given the oral evidence of Prof Steve Field to t he Public Bill Committee on 28 June 2011 when he stated the following:

· "If you wanted a gut feeling from what was happening in the listening exercise – the feeling was actually the private cap should stay because people felt tha t would provide the protection " ;

· " To be honest, we didn't put as much in our report as perhaps we could have done. In fact, it was one area, when we reread the paper at the end, we m ight have been stronger on " ;

· " ...if you opened the cap it may be more likely to be under … EU law, and from competition and from Monitor. " [1]

Secretary of State responsibility for the NHS

5. While the latest government amendments do add a new clause designed to provide reassurance around the responsibility of the Secretary of State to promote a comprehensive health service, the wording o the 2006 National Health Service Act is still changed from the Secretary of State having to "provide or secure the provision of services" to having to "exercise the functions conferred by this Act so as to secure that services are provided in accordance with this Act". This puts the delivery of services increasingly at arm’s length and away from Parliamentary scrutiny.

6. Moreover, the main thrust of Clause 9 of the Bill remains unamended: the NHS Act 2006 is changed so that it is GP consortia not the Secretary of State that must arrange for the provision of health services. This means that consortia will determine what actually constitutes the health service, potentially opening the door to consortia charging "top-up" payments for certain services they deem as being outside of their definition of health services. Clause 10 says consortia must arrange for the provision of services "as it considers appropriate" – giving consortia great leeway in how they exercise this. Clause 4 on "autonomy" remains unamended and grants greater freedoms to how bodies such as consortia carry out their functions. There is still no direct duty of comprehensiveness on consortia. Clause 5 retains the wording that the National Commissioning Board is responsible for arranging the provision of services.

7. All of this serves to undermine the accountability of the NHS to Parliament, by putting the provision of health services increasingly at arm’s length. It opens up the way for the comprehensive and free nature of NHS services being undermined as consortia could look to shed expensive or unprofitable services, or to charge for them. It increases the likelihood of a postcode lottery of provision, with different consortia providing different services. Open rationing is already beginning to take place in PCTs for items such as knee operations and IVF treatment – this will only get worse when the profit motive becomes the driving force. This could be exacerbated by the proposed development of a new Right to Challenge, in which single issue groups may demand certain extra services in their locality. UNISON is also concerned that there has so far been insufficient investigation of the potential impact this could have on the VAT exemption enjoyed by the NHS.

Openness and transparency

8. The government amendment to improve the openness and transparency of consortia is too weak including a get-out clause for consortia that want to avoid meeting in public: the wording says "except where the consortium considers that it would not be in the public interest to permit members of the public to attend a meeting or part of a meeting". There is too big a loophole.

9. There is a similar problem with the amendment to ensure boards of directors of foundation trusts be open to the public: FT constitutions "may provide for members of the public to be excluded from a meeting for special reasons" – there is no explanation about what these "special reasons" are, so this is also open to abuse.

10. To make these changes stronger, the government should ensure that consortia and FTs are subject to the Public Bodies (Admission to Meetings) Act 1960, which gives access to the public and press. PCTs and SHAs are currently covered by this. This is certainly the opinion of lawyers on how the Bill could be improved. [2]

11. There is also no mention of a register of interests to ensure that those involved with a consortium who are also shareholders in other companies can be held to account.

Monitor and competition

12. Although the clause relating to Monitor’s remit has been changed, it remains an economic regulator – contrary to the recommendation of the Future Forum. This is still completely inappropriate for the NHS – it must be treated as distinct from the railways or privatised utilities.

13. There is only one small change to the whole of Part 3 Chapter 2 (entitled "Competition") meaning that all the increased exposure the NHS can expect to the Competition Act, the Enterprise Act, the Office of Fair Trading and the Competition Commission remains intact. This means that mergers may have to go to the Office of Fair Trading and the Competition Commission for approval, meaning that such issues are not clinically-led or -evidenced decisions but are based on competition law.

14. Monitor’s responsibility for "promoting competition" has been removed but added to the Bill are repeated references to "preventing anti-competitive behaviour" (same for the NHS Commissioning Board). In practice, this could end up meaning something very similar.

15. David Bennett from Monitor told the Public Bill Committee on 28 June 2011 that he did not expect the amendments to change Monitor’s powers. This is also the opinion of lawyers consulted by the Health Service Journal in the past week. Bevan Brittan LLP Partner David Owens said: "I’m not sure they have made much in the way of substantive change. They have changed the emphasis – but Monitor is still going to have concurrent powers under the Competition Act with the Office of Fair Trading. That implies the expectation is competition law is going to apply to providers." [3]

16. Government moves to balance competition with integration appear to be very lop-sided, with the latter little more than window dressing. Monitor, the NHS Commissioning Board and consortia must secure that health services are "provided in an integrated way". But nowhere in the amendments is there anything to define what this means or to add substance to the proposals, compared to government amendment 178 that adds in some definition of "anti-competitive behaviour".

17. There are greater restrictions placed on when providing services in an integrated way can be done: only when it would improve quality or reduce inequalities. It would be stronger if Monitor had to promote integration when it was simply in the interests of patients. Crucially there also appears to be no way of enforcing the need to provide services in an integrated way: where are the references to preventing anti-integrative behaviour?

18. Similarly there is nothing added to the Bill on cooperation or collaboration such as a duty to promote collaboration. The Future Forum recommended that Monitor should promote collaboration and integration as well as choice.

19. It is not clear yet how the existing Principles and Rules of Cooperation and Competition (PRCC) will be incorporated into Monitor’s structures (or the Panel that enforces these), but it is worth noting how heavily weighted the PRCC are in favour of promoting competition: only one of the ten principles is about cooperation.

20. The government response to the Future Forum said that "the Bill does not change EU competition law". This is not the point; the Bill was never going to change the EU’s own laws. What it did, and will still do, is make it more likely that EU laws can be invoked by disgruntled private providers. Activity carried out for social purposes is generally not subject to EU competition law. However, the more private providers that are encouraged to deliver healthcare the less clear this exemption becomes.

21. The government has freely admitted that once the policy of Any Qualified Provider brings in a wider diversity of providers to the NHS, then EU competition law is more likely to be applicable: health minister Simon Burns’ written answer March 2011: "as national health service providers develop and begin to compete actively with other NHS providers and private and voluntary providers, UK and EU competition laws will increasingly become applicable". [4] Although AQP will apparently be rolled out more slowly, the policy remains.

22. Other commentators agree with Burns’ assessment: a recent legal contribution to the British Medical Journal confirmed that "the reforms further open up the NHS to EU competition law" [5] ; lawyers and academics have confirmed elsewhere that the more the government forces competition into the NHS the harder it will be to argue that EU law does not apply. [6] Government plans designed to devolve responsibility for the NHS to the local level instead run a very real risk of handing over a greater say to the EU.

Role of the private sector

23. The initial government response to the Future Forum on 14 June seemed to acknowledge the dangers of consortia outsourcing their commissioning functions. However, the formal government response of 20 June clarified merely that "statutory responsibility for decisions continues to rest with the responsible NHS commissioner" and, crucially, that "this does not in any way preclude NHS commissioners from using external agencies to provide commissioning support". So the wholesale outsourcing of the commissioning of services remains very much a possibility and nothing in the latest government amendments to the Bill will stop this.

24. The government has made much of its plans (included in new amendments 22, 100, 177) to block the Secretary of State, Monitor and the Board from embarking on a deliberate policy to increase the role of the private (or public) sector in delivering services. But this statement and these amendments are deeply disingenuous: the government already has a policy (Any Qualified Provider) that will inevitably bring in a greater number of private providers even if this is not its explicit aim. Equally, plans to enforce a "level playing field" will clearly boost the prospects of the private and the community/voluntary sector. And other government initiatives such as the Right to Provide and the Right to Challenge will disadvantage existing public providers. Most importantly, these amendments put a legislative block on the NHS being the "preferred provider" of services in the future, so that the path to greater privatisation is assured over time. The government has not done any analysis of what this policy would rule out and what impact it would have on the NHS.

25. The recent examples of appalling treatment of patients at the Winterbourne View private hospital and the ongoing uncertainty around the future of Southern Cross provide ample illustration of the dangers of opening up care services to a wider range of private providers.


26. Any company obliged to maximise returns for its shareholders will always look to take on low-risk, high-profit services regardless of government attempts to discourage them from doing so. Minor changes around the edges will not be sufficient when one of the explicit aims of the government white paper is to bring in a greater number of providers through the Any Qualified Provider policy.

27. Government plans to block cherry-picking with the addition of a new clause designed to reflect the costs incurred in delivering healthcare (presumably to take into consideration issues such as the NHS paying for training of staff and carrying out more complex procedures) relies heavily on the government / Monitor being able to set a complex and comprehensive tariff regime to reflect these nuances. This is an extremely difficult task and developing new tariffs has proved particularly challenging in recent years so, if not impossible, such a task will take years to complete. What happens in the interim?

28. The government has continually refused to give any commitment to staff terms and conditions or to staff retaining access to the NHS pension when services are transferred out of the NHS. This makes it easier for other providers to undercut national terms and conditions, particularly if restrictive tariffs are set that encourage providers to make cuts in these areas.

Price competition

29. UNISON still has concerns that price competition could result from a combination of the latest Operating Framework (that refers to the "opportunity for providers to offer services to commissioners at less than the published mandatory tariff price") and the new ultra-competitive system devised for the NHS.

30. The promise in paragraph 5.42 of the government’s formal response to the Future Forum requires commissioners to follow "best value" principles when tendering for non-tariff services, rather than simply choosing the lowest price. There is so far no reflection of this in the latest government amendments to the Bill.

31. If the government is serious in its assertion that price competition is not its intention, then a change is needed to the Operating Framework to rule it out completely, along with the revised Procurement Guide from July 2010.

32. The previous government’s final Operating Framework did refer to moving to a position "where national tariffs represent the maximum price payable by a commissioner". But the context was very different; this was within a managed and integrated system, where commissioners were to be given more leeway to push down the prices charged by existing providers, not to open the door to providers to outbid one another on who could offer the lowest price. Introducing maximum pricing into a system of unconstrained market forces is bound to lead to competition on price.

33. The recent example of commissioners in south west London negotiating below tariff prices for urgent admissions is exactly the type of activity that the new system is likely to block as "anti-competitive".

Health and Wellbeing Boards

34. UNISON believes that plans for Health and Wellbeing Boards need to be strengthened further by insisting that they must agree to local commissioning plans and by ensuring greater democratic involvement. For them to express real democratic accountability, at least a majority of the Board should be elected councillors; ideally all voting members should belong to the HWB.

35. UNISON also supports the addition of a representative of the local Schools Forum to the list of those sitting on a Health and Wellbeing Board; as currently worded there is a role for directors of children’s services but not for representatives from education – Health and Wellbeing Boards should join-up services across areas. The Boards also lack the input of trade union representatives, to ensure the staff voice is heard.

June 2011

[1] The Guardian , “ NHS forum GP admits private patient doubts”,

[2] Health Service Journal , “ Health Bill: rules unclear on open board meetings ”,

[3] Health Service Journal , “ Health Bill: competition changes may not be ‘substantive’”

[4] House of Commons, written answers, 7 March 2011, Simon Burns MP response to Tom Blenkinsop MP

[5] British Medical Journal , “Challenges of EU competition law for general practice commissioning”, Rupert Dunbar-Rees and Robert McGough, 7 April 2011. (BMJ 2011; 342:d2071)

[6] Health Service Journal , “ NHS market faces closer EU attention”, 19 January 2011

Prepared 11th July 2011