The Big Society - Public Administration Committee Contents

Written evidence submitted by Foundation Trust Network (BS 93)


The Foundation Trust Network (FTN) is the independent membership organisation for authorised NHS foundation trusts and those aspiring to achieve foundation trust status. We have over 200 member organisations from the acute healthcare, mental health, ambulance and community services sectors.

The FTN welcomes the opportunity to submit evidence to the Public Administration Select Committee.


We would suggest that any definition of Big Society would include a new definition of "public ownership" quite different from the statist ownership of the past, so that local communities can have a direct influence over the nature and scope of the services they receive and are able to hold to account the professionals who deliver those services. But if accountability in public services is to be meaningful it needs to be democratic and inclusive, so that the views of all stakeholders are taken into account. It also needs to be structured so that the accountability process is transparent, manageable and accessible.


The Department of Health's command paper (published in December 2010) reinforces the success of the foundation trust movement to date when it stated that FTs comprise one of the largest and most vibrant social enterprise sectors in the world.

NHS foundation trusts are now nearly seven years old. Having grown from twenty FTs in 2004 to 136 in March 2011, the FT sector offers a wealth of experience in terms of establishing independent, decentralised provision in public services that engages the community, service users and stakeholders. The sector has:

—  93 acute foundation trusts.

—  41 mental health foundation trusts.

—  2 ambulance foundation trusts.

—  456,000 employees.

—  Nearly 1.8 million members (and growing).

—  4,200 governors (and growing) made up of the public and service users (over half); staff and local stakeholders/partner organisations.

—  Organisations with turnovers ranging from £80 million to £800 million.

—  A sector value of over £30 billion.

—  NHS trusts community services are preparing for authorisation.

Central to foundation trusts' progress is the unique nature of the corporate model that is applied to foundation trusts—the public benefit corporation. With freedoms and responsibilities similar to the private sector, but incorporating elements of social enterprise, the foundation trust model was developed to ensure the best return on investment for public assets in terms of efficiency, quality and the longer term sustainability of services that are vital to public well being. Foundation trusts remain public sector organisations based on the values of the NHS, with behaviours that derive from those values. They do not distribute their surplus, rather they reinvest it in improving health services in the short and long term.

Foundation trusts are governed by a corporate board and locally accountable to an elected board of governors. They are authorised by and accountable nationally to the regulator Monitor, on the grounds that they achieve robust financial and governance performance and are then free to operate independently of state performance management. Under Health and Social Care bill proposals, Monitor's direct responsibility for FTs will disappear when they take on a broader role as the economic regulator.

Locally they are accountable to local communities and stakeholders via their governors elected by three constituencies of public, patients and staff. The Health and Social Care bill strengthens the role and duties of the foundation trust governors. This governance structure and accountability is what frees foundation trusts from central control.

The authorisation process gives foundation trusts commercial freedoms not available to other non-authorised NHS organisations that have some parallels with private sector operators, and like all independent organisations foundation trusts carry their own liabilities and are responsible for their own risk management. The scale, independence and complexity of foundation trusts means that the corporate boards operate at the same level as FTSE listed companies; they are entrepreneurial with a "go anywhere" and "be ready for anything" mindset, focused on social aims and aspirations.

The FT model has proven itself in terms of efficiency and governance. It has demonstrated its potential to overcome that age old problem of public sector inertia, inefficiency and lack of customer responsiveness and develop a "can do" spirit. And it represents a realistic rolling back of the state to accommodate a modern pluralistic democracy that incorporates the spirit of voluntarism and community solidarity.

In essence, the foundation trust model:

—  Devolves the management of risk to feasible levels with right expertise.

—  Pushes continuous improvement, drive for efficiency, investment in locally prioritised services.

—  Reconnects essential services with customers, service users and local communities.

—  Plays a key role in re-building participation and pride in civil society.

The FTN believes that the foundation trust model—with its local membership and elected governors - exemplifies many of those elements that make up the concept that is the Big Society.

March 2011

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Prepared 14 December 2011