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Earl Howe: I should like to speak briefly to Amendment No. 245. The noble Lord, Lord Smith, and the noble Baroness, Lady Barker, got to the heart of a matter which continues to generate a deal of concern and uncertainty, both in local government and the NHS. I find that the same questions are being asked everywhere: to whom will care trusts be accountable; through what precise mechanisms; who will control care trusts; will each one be different in this sense or will the regulations safeguard each party from being railroaded by the other? There is a fear that however much a care trust may be the result of a voluntary arrangement, and despite the Minister's assurances at Second Reading, there is scope further down the track for a hostile take-over.

In the department's recently published document, Care Trusts--emerging framework, referred to by my noble friend Lady Cumberlege a few moments ago, the extent of the work still to be done on the question of governance is all too painfully apparent. The document states:

It goes on,

    "The Government is considering how the board can best be constituted".

Those sentences do not exactly suggest a clear sense of direction. If the Minister is in a position to enlighten us now on the detail of the Government's arrangements, the structure of the board, its balance and functions, that would be welcome.

Like my noble friend Lady Cumberlege, I feel positive about the principle of care trusts but there are sceptics out there--not just for the reasons to which my noble friend referred but because many people wonder what extra benefits care trusts can achieve on top of what can already be done under the Health Act flexibilities.

Perhaps I may conclude by asking the Minister a question. Clauses 52(3) and 53(5) read together suggest that a care trust may also take on health-related local authority functions outside the area covered by the PCT or NHS trust which has been redesignated a care trust. Indeed, those subsections would seem to imply that a care trust designated from a PCT or NHS trust in the area of one local authority might be able to take on the health-related local authority functions of part or the whole of an adjacent local authority area. It is difficult to square that prospect with notions of local accountability for local services or the policy intention to enhance collaborative working. It would do the exact opposite. I wonder whether the Minister could comment.

Baroness Barker: Perhaps I may ask a question on the point made by the noble Earl, Lord Howe. Let us suppose that a patient is under a GP who is within a care trust area which has been agreed between the

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NHS body and a local authority. Let us also suppose that the patient lives in a different local authority--some PCTs cover more than one local authority area--which is not yet part of a care trust but which uses pooled budget arrangements with its own PCT. Will that person receive social care from the care trust or the local authority where he or she lives, which is out of the pooled budget area? My question concerns non-coterminous boundaries.

Lord Hunt of Kings Heath: Perhaps I may say to the noble Baroness, Lady Masham, that this is not a way of extending the means test or, indeed, of cost shift between the two parties to any care trust arrangement. We may discuss this in more detail on a later amendment.

I refer to the comments of my noble friend Lord Smith. I know that in Wigan there is a strong partnership between the NHS and local government. I believe that they are keen to take forward the concept of care trusts. That is encouraging in terms of what we are likely to achieve in future. I accept the points raised by the noble Baroness, Lady Barker. Asking two cultures to work together will not always be easy. We know that the medical model and the social care model can be different. However, we also know that there is much to be gained if this can be pulled together. If we can teach doctors to regard people as individuals and not just patients, that surely is an example. I am sure that the NHS can help to teach people in social services about some of the advantages of the way the NHS works.

The great beauty of care trusts is trying to ensure that everything is pulled together. As regards social services legislation, the care trust will have responsibilities delegated to it by the local authority. As regards performance assessment the social services inspectorate will be as involved in those services as it would be if the services were run directly by the local authority. As regards performance assessment, the social services inspectorate will be as involved in those services as though they were run directly by the local authority.

7 p.m.

Baroness Barker : Will the performance indicators used be those of the NHS or the LGA or will there be new joint performance indicators?

Lord Hunt of Kings Heath : Some of the detail of performance management has still to be sorted out. I would consider that common sense indicates that if one is talking NHS services, one may use its performance indicators. If they are services which can be directly identified with the social services, its performance framework would be applicable. I do not believe that we should become too hung up on that. Equally, in performance management generally, we need to make sure that care trusts are not affected by too many different approaches to performance management. Given that the Department of Health is responsible for both health and social services, it should not be beyond the bounds of possibility for us to ensure that we achieve that.

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I take up the issue of boundaries which the noble Earl, Lord Howe, raised. There is no doubt that flexibility will be required to cope with different populations covered by local authorities and the NHS. For instance, care trusts may have responsibility for local authority health-related functions only for some sections of the population. We will need some flexibility in the arrangements in order to make sure that the public do not hit some kind of bureaucratic barrier which prevents them from receiving the services they need.

The noble Earl raised the issue of the department developing its policy in these areas. Given that it is a very new concept which involves different statutory organisations, there is a great deal of benefit in working through the policies in co-operation with and with co-ordination with the NHS and local government. That is what we are seeking to do.

As regards governance, we are working with the LGA to ensure that the regulations demonstrate the proper concerns that all the functions which care trusts take on are reflected in the governance arrangements. I can assure the noble Earl that we are not looking for a one-size-fits-all for care trusts. We do not want to be tied into a situation where the numbers of people for health and local government are fixed. That may look like equality but I doubt whether it would meet the needs of individual care trusts. We are looking for a framework in which local partners can agree and propose a locally-negotiated agreement, with the number of executive and non-executive officers being determined within the context of that framework.

So again taking a leaf from the noble Earl's book, we do not want to be prescriptive. We believe that it is about local ownership and negotiation. It very much fits into the voluntary nature of the great majority of the care trusts. We want it to be a partnership of equals, and that is why it is best to leave those matters to be discussed locally as far as we can.

The governance of the care trusts is very important. We want to make sure that the members of the board feel the full spirit of the corporate body. For that reason it makes sense for all non-executive members to go through a similar process of appointment. In that regard, because they are NHS bodies, that will be for the NHS appointments commission. We recognise that local authority members have already been through a selection process of their own, if I may call the ballot box that. So we shall be keen to ensure that the NHS appointments commission does at least the minimum of checks for probity.

We also have to bear in mind that as regards the chair, the Secretary of State must carry out that function in the same way as for all other NHS bodies, through the independent appointments commission, set up expressly to ensure independence. There is a problem that if the local authority is involved in that process we will effectively lose the independence we have sought to develop with the introduction of that commission on 1st April this year.

I agree with Members of the Committee that it is clear that we need a transparent and robust process. I hope that I have answered the points which have been

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raised. I emphasise in particular that we are keen to have local agreement within whatever kind of framework we set as regards governance arrangements.

Lord Smith of Leigh : I thank the Minister for his response. I welcome the flexibility which he said would be part of the package. He has told us about a partnership of equals. I accept that the independent appointments commission would want to see who the local authority appoints. But for political reasons or the fact the local authority members were not carrying out their duties in terms of being accountable to that authority, there would need to be some ability for the local authority to determine whether a member continues in that role, subject to the appointments commission.

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