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Lord Hunt of Kings Heath: I certainly hope not as that would take us back to fudge and mudge. We must be clear that each statutory authority has its own responsibilities which it must carry out.

Earl Howe: The difficulty as I read the clause is that subsection (4) is a knockdown test, taken in conjunction with subsection (5). There is no attribution of blame here other than blame on the responsible authority if it fails to meet its obligations. On any reasonable interpretation of those subsections a failure by a local authority to meet its obligations, no matter what the reasons, constitutes grounds for imposing a penalty. That is the issue that has worried me and other Members of the Committee. Despite the

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Minister's helpful responses which give me comfort, I am not sure that I can read his interpretation into the text of the Bill.

Lord Hunt of Kings Heath: I have gone into the matter carefully and have taken advice on it; namely, that the way in which the clause is written provides the satisfaction that the noble Earl requires. I shall be happy to write to the noble Earl to see whether I can clarify the matter further before Report stage. I appreciate that this is an important matter to clarify.

I apologise to the Committee as I was speaking to Amendment No. 87 and not to Amendment No. 85.

Baroness Barker: I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 78 to 84 not moved.]

Lord Hunt of Kings Heath moved Amendment No. 85:

    Page 4, line 29, leave out "provide" and insert "make available"

On Question, amendment agreed to.

[Amendment No. 86 not moved.]

Lord Hunt of Kings Heath moved Amendment No. 87:

    Page 4, line 38, at end insert "and

"(c) every service that it decided under section 3(4)(b) to make available to a carer has been made available,"

On Question, amendment agreed to.

[Amendment No. 88 not moved.]

The Deputy Chairman of Committees: I should point out to the Committee that if Amendment No. 89 is agreed to, I shall not be able to call Amendments Nos. 90 and 91 owing to pre-emption.

Baroness Barker moved Amendment No. 89:

    Page 5, line 11, leave out subsection (9) and insert—

"( ) Any payment which a relevant NHS body or relevant social services authority is required to make under this section shall be made to a fund, to be known as the "discharge aftercare fund", which shall be held and jointly administered by the Primary Care Trusts and relevant social services authority in each area.
"( ) Expenditure from the discharge aftercare fund shall be agreed jointly by the Primary Care Trusts and social services authority in each area."

The noble Baroness said: The amendment takes us to one of the most commented-on flaws in the Bill. If one accepts that the system of fines is, as the Minister would have us believe, a patient-centred system designed solely to alleviate the difficulties suffered by people because of delayed discharge, why will the resources released back from social services to the NHS go into acute care generally? Why will they not be specially designated as resources intended to deal with delayed discharge?

We have talked repeatedly about the reasons for delayed discharges. To the best of my knowledge, the provision of acute care is not one of them. Throughout

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our discussions, many Members of the Committee have been concerned about what we have called perverse incentives. In one of our earlier discussions, the Minister referred to gaming. I gave an example of an acute trust that changed its definition of delayed discharges for income generation.

That seems to amount simply to a system of distortions between two sets of statutory authorities, and has very little to do with tackling the underlying causes of delayed discharge. If we believe that the Select Committee on Health is right in that delayed discharges happen at least in part because of lack of resources and planning, it seems correct to say that the money should be aligned to the solution of that problem. For those reasons, we tabled the amendments, which propose that money should not go straight back into acute care but that it should be put into special discharge funds. Crucially, primary care trusts would be involved. They as much as acute care trusts have an interest in making sure that the causes of discharge, which they might be more able to analyse because they will be closer to them than the acute trusts, should come into play.

In addition, one element of the Swedish system built into the amendments is that decisions should be made locally. I keep returning to that point. In a moment, the Minister can tell us what performances by acute hospitals and PCT areas are on delayed discharge. What he cannot tell us is what else is going on, what readmission figures are like or why they are caused.

The amendments are an endeavour on our parts to try to make a very bad system somewhat better, by saying that resources ought to go to the point where problems can be sorted out. I imagine that the Minister will follow the lead of his colleague in another place and attempt to rule them out on the grounds that those who are at least in part responsible for the failures should not be rewarded by having the resources handed back to them. However, the involvement of primary care trusts is a significant enough factor in itself to make sure that we are not simply rewarding social services departments that are deemed to be not fulfilling their side of the bargain. If we are not only to be tough on delayed discharge, but tough on the causes of delayed discharge, perhaps that should be part of the equation. I beg to move.

Baroness Noakes: I shall speak to Amendments Nos. 90 and 92, which are included in the group.

We fully agree with the noble Baroness, Lady Barker, that it is inappropriate that the hospital that levied the fine should itself determine how the money is spent. It is a thoroughly undesirable incentive for hospitals to maximise the fines that they collect. However, we are not convinced about Amendment No. 89 so far as concerns where the money should go. Our view is that if the fine is calculated as the cost per day of unnecessarily keeping a patient in hospital—I understand that that is the broad logic underpinning the Government's calculations of 120 and 100 fines—the hospital will have been paid for its bed under the various agreements that it has made with

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PCTs. It might not have done anything else with the bed, but that is not relevant so far as the hospital is concerned, because it will have been paid.

It is therefore logical that the fine should be paid to the PCT, so that the PCT can determine whether to pay for more acute treatment in that hospital or another hospital, or to pay for non-acute services, perhaps in the community. I am aware of the seductive nature of labelling the money for discharge aftercare, but that is not logical. The PCT should already be funding discharge aftercare. Giving it more money for that purpose because it has had fewer discharges is as irrational as letting the hospitals have the money.

Like Amendment No. 89, Amendment No. 90 emphasises the local nature of the decision process. Clearly, there may well be a decision within the PCT to fund further services for patients who are discharged, but equally there are many health priorities on a local basis that should have a greater call on the money.

Amendment No. 92 deletes subsection (10) of Clause 4 and is a probing amendment. Under subsection (9), fines are to be paid—wrongly, we believe—to the hospital in which the patient is staying. However, subsection (10) allows the Government to specify in regulations that in certain circumstances the payments should go elsewhere. As usual, the Explanatory Notes are spectacularly unhelpful and restrict themselves to a precis of the subsection.

I am aware that the draft regulations recently published for consultation deal with payment being made to an independent hospital if care has been arranged by the NHS but for some reason the independent hospital is not being paid for that by the NHS. I certainly find it rather fanciful that an independent hospital would get itself in that position, but do not see the taking of fines from local authorities as anything like an appropriate solution. What other circumstances could possibly arise where another body should receive the fines?

In our debates yesterday, the Minister said that foreign hospitals treating NHS patients, under one of the Government's desperate attempts to reduce the waiting lists, would be covered by the Bill. I do not think that I am overstating the position when I say that Members of the Committee were astonished at that. Indeed, the very precise description used by the noble Baroness, Lady Barker, yesterday was "gobsmacking". I am sure that we will return to the consequences of that revelation on Report. For today, will the Minister confirm that subsection (10) would never be used to force UK local authorities to pay fines to foreign hospitals?

The amendments show how ill thought-out the whole scheme of fines on local authorities is.

Lord Hunt of Kings Heath: I do not really agree with the thrust of the amendments, which seek once again to remove clarity for responsibility under the Bill. All the time, a number of amendments seek to take us away from the clarity that is so important in making sure that the incentives and practices of different

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organisations work to the benefit of the individual patient. The point of the Bill is to provide a financial service or incentive for social services to invest in the community care services that are needed to prevent delayed discharge in the first place. It is not intended to provide a fund to spend on community services.

Logically, the money incurred from the penalty charge must go to the acute trust—it is the trust that cares for the patient—without any other funding for that care. The trust must be the key player in deciding how any funds are used. It is possible that the acute trust will set up an agreement with the local authority or the primary care trust in the way suggested, but that must be a decision for the acute trust.

The amendments, which suggest that the income from the reimbursement charge should not go to the acute trust but to the PCT or to a joint fund held between the PCT and social services, surely miss the point. The acute trust will have lost out through providing services to a patient who no longer needs to be in a bed, and it is the trust that should be compensated.

5.30 p.m.

Baroness Noakes: I thank the Minister for giving way. Can he explain how the acute trust loses out? The acute trust has service level agreements with PCTs involving great blocks of money that fund the trust. It is not funded on a per diem basis. If we were talking about America, I believe that I might agree with the noble Lord. But I simply cannot understand how the acute trust bears that amount of money.

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