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Baroness Noakes moved Amendment No. 9:



"SPECIALISED SERVICES
(1) The Secretary of State shall not direct Primary Care Trusts under section 16D of the 1977 Act as to his functions in relation to specialised services as defined in subsection (3) but may so direct Strategic Health Authorities.
(2) The Secretary of State shall not direct Primary Care Trusts or Strategic Health Authorities under section 16D of the 1977 Act in relation to national specialist services as defined in subsection (4).
(3) Specialised services for the purposes of this section are the services covered by the National Specialised Services Definition Set issued by the Department of Health from time to time.
(4) National specialist services for the purposes of this section are the services which are the responsibility of the National Specialist Commissioning Advisory Group from time to time."

The noble Baroness said: My Lords, this amendment returns to the topic of specialised services which we debated in Committee. The amendment is an improved version of the one we debated in Committee. It has two objectives: first, that the Secretary of State cannot devolve commissioning of specialised services covered by the National Specialised Services Definition Set to primary care trusts but may devolve to strategic health authorities; and, secondly, that the Secretary of State cannot devolve the commissioning of national specialist services covered by the National Specialist Commissioning Advisory Group to either PCTs or strategic health authorities.

I do not think that there is any controversy with regard to the second of those propositions as I do not believe that the Government have suggested anything else. Indeed, even the Minister with his unbounded enthusiasm for PCT capabilities has not, I believe, suggested that they take over commissioning from the National Specialist Commissioning Advisory Group.

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The real issue concerns specialised services. I think that it is common ground that it is unlikely that individual PCTs will consider commissioning specialised services on their own. These are services which are currently covered by regional specialised commissioning groups. They cover 37 services, some of which are still in draft.

The arrangement that Shifting the Balance of Power envisaged, and was urged on us by the Minister in Committee, is that PCTs should commission collaboratively. But that assumes that all PCTs will want to work collaboratively, with one PCT leading and others providing the funds. It is by no means clear that they will. Indeed, the noble Lord, Lord Turnberg, told the Committee that he had spoken to some non-executive directors of PCTs who said that they did not want to work in that way. And there are real concerns that the primary care focus of PCTs will lead them away from acute commissioning in general and away from commissioning low volume, high cost specialised services in particular. The prevailing primary care orientation in PCTs is unlikely to make successful specialised services commissioning through collaborative mechanisms a racing certainty.

The Minister had an answer in Committee for the possible reluctance of PCTs to buy into local collaborative commissioning. He said that if a PCT was,


    "not prepared to play ball . . . the strategic health authority would have the opportunity to intervene and bang heads together".—[Official Report, 14/3/02; col. 1025.]

Noble Lords who have followed the passage of the Bill thus far will know that "head banging" is the colloquial term for performance management. The Minister said that he did not expect many PCTs to refuse to form consortia. But the mere fact that purchasing consortia are required is an indication that commissioning for specialised services has been delegated to the wrong level. The most natural level is the strategic health authority. The Minister said in Committee that commissioning consortia,


    "might cover the population size of the strategic health authority or involve going across one strategic health authority boundary to another".—[Official Report, 18/3/02; col. 1170.]

Shifting the Balance of Power specifically states that strategic health authorities will sit on the specialised services consortia of PCTs.

What is all of this telling us? It is as clear as daylight that the natural level for specialised services commissioning, given the structure of the NHS that the Government have forged, is the strategic health authority. Many of us here may think that 28 is too many for that tier in the NHS. Indeed, I should be prepared to lay money that that number will come down through mergers. But that is the structure that we have and within that it is more logical to devolve specialised service commissioning to strategic health authorities as they most naturally represent the population for whom services will be commissioned.

The Minister told us in Committee how he envisaged PCTs working in networks, not just for specialised services but also for public health and other

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areas that go beyond the relatively small populations covered by each PCT. If those networks do not function well enough, the strategic health authority would have to step in and, to use the euphemism, "performance manage" them. That rests on networks being a natural way of operating. The Government's concept of health service management is through a lot of ever more complex networks and partnerships. That is simply too complex and ignores the fundamental principle of organisation design, which is maximum simplicity.

I do not doubt that managing the health service is a complex matter but I do doubt that creating complexity for the sake of it is a sensible approach. I should stress that we on these Benches do not oppose the devolution of functions. It was we and not the current Government who started the firm push towards decentralisation in our 1990 reforms. But we do not agree with decentralisation to unnatural levels or with over-complex management structures.

As I said in Committee and will say again now, specialised services are vital services and must be protected. It is in our view wholly wrong to use the infant PCT structures in some kind of experimental re-engineering of networks to undertake this essential commissioning task. I beg to move.

7 p.m.

Lord Clement-Jones: My Lords, as the noble Baroness, Lady Noakes, said, the Minister discussed in some detail on the second day of our debate in Committee the question of specialised services and the way in which they would be commissioned. As we have heard, the Government's proposals involve the dismantling of the current regional specialised commissioning groups and the creation of commissioning consortia. The reason for that, as the Minister said in Committee, involved the interrelationship between primary, secondary and tertiary care, rather than treating specialised services as an isolated service to be resourced and dealt with in a completely different way from that applied to other services that will be commissioned by PCTs in the future. Despite those words of attempted reassurance, many of us believe that the Government's current proposals to devolve NHS specialised commissioning responsibilities to primary care trusts in that way could lead to a deterioration in the national provision of specialised services.

Clearly, different primary care trusts will have different commissioning expertise. Who will be responsible for poor commissioning in, for example, specialised heart surgery? Who will monitor performance, and so on? Who will even guarantee that there will be the necessary expertise within a particular consortium? That could, we believe, lead to a new postcode lottery for specialised services, in which the availability of treatment for those serious illnesses was decided not on clinical need but on geographical location.

The Minister mentioned the interim role of the regional specialised commissioning groups (RSCGs) in handing over capacity and skills to primary care

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trusts. That is extremely welcome, but why cannot those bodies be kept in place as a permanent repository of expertise and information? Much of the Bill is already so virtual as to give rise to real concerns. We have public health networks, patients forums co-ordination and now the consortia. All of that seems to stem from the Secretary of State's unwillingness to have any clear lines of accountability whatever.

Although the primary care trusts that join the consortia will be bound by existing financial commitments, they will have complete discretion about whether or not they wish to prioritise spending on particular specialised areas and join an individual consortium in the first place.

The RSCGs will have no power to compel primary care trusts to join consortia. Will the strategic health authorities be able to do so, other than by banging heads, as the noble Baroness, Lady Noakes, suggested?

The proposed system of PCT consortia could lead to a substantial disruption in the provision of specialised services. The Minister's words in Committee were helpful as regards the transitional process to cover circumstances in which LHA service agreements run out and existing consortia do not effectively cover specialised commissioning needs. However, the fear on these Benches—and, clearly, on other Benches—is about the longer term. We believe that the arrangements in the Bill are not satisfactory and we have considerable doubts about the future of specialised commissioning.

Earl Howe: My Lords, like other noble Lords, I am very concerned about the risk that we are running in relation to specialised services—that of destabilising the commissioning mechanisms that have been built up over the past few years. It seems that there are huge dangers in dismantling the regional system of specialised commissioning for services such as paediatric and neonatal intensive care, cleft lip and palate, burns and plastic surgery and haemophilia. Much careful work has been done at the regional level in terms of developing coherent plans for vital services such as those. That work must be safeguarded; it must not be jettisoned.

My noble friend Lady Noakes mentioned the work of the National Specialist Commissioning Advisory Group, which deals with highly specialised services such as rare cancers and liver, heart and lung transplants. The work done by the NSCAG has created coherence and consistency across the country. I hope that the Minister will reassure us in his reply that there is no threat to the work of that group.

My concern as regards any commissioning that takes place above the level of the primary care trust—I suppose that this anticipates a later provision in the Bill—is that there is a lack of clarity about the arrangements for patient and public involvement in the commissioning process for services of that kind. A rule of thumb should be followed: wherever commissioning takes place—whether at national level, or lower down in the structure—that is the place at

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which the consultation must be conducted. Consultation cannot be ignored in that context because it is a key part of the quality agenda. I believe that that makes it essential for there to be a specific duty to consult at the right level. We shall deal with that point later. Having a hotchpotch of primary care trusts consulting their local communities in different ways would be unacceptable because it would not be possible to determine whether consultation on a particular change covering a specialist service, for example, had or had not been effective; nor would it be clear who could be held to account for it.

If the Government are wedded to their plans—I take it that they are—I commend to them the idea of a joint commissioning committee in a group of primary care trusts, with clear responsibilities for consultation and patient and public involvement as well as clear accountability and audit arrangements. For that, it may be necessary for PCTs to pool their budgets and to delegate their legal duty to commission. Perhaps the Minister could comment on those ideas when he replies.


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