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Baroness Noakes: I thank the Minister for that response. It is a pity we cannot spend longer today debating the internal market; both of us would doubtless enjoy that. I shall confine my remarks to the amendment.

The Minister asked us to look on performance management as taking some of the burden of ensuring that things work well in the NHS. There are those on these Benches who have always been less than convinced about the system of performance management on which the Minister has often fallen back when describing how things will work well in the NHS. We would not regard that as anything like an incentive system.

I welcome any information the Minister has on readmission rates. The statistics I have show that over the two years between 1999 and 2001 within two months the readmission rate increased from 19 per cent to 43 per cent. The proportion of that attributable to early discharge went up from 23 per cent to 45 per cent. The statistics present a real problem, hence the amendment. They occur without the additional incentive for hospitals to discharge patients in order to earn fines.

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The Minister has already suggested that it is a cynical approach to think that managers will organise their affairs in order to collect fines, but I think that it would be a rational response for any person in the NHS to try to maximise the available resources within an organisation. NHS bodies are not flush with money. If they see an opportunity to raise further resources they will use it. That would be a perfectly normal response within a trust. That is why we are so concerned that putting in the additional incentive of the fine system will make worse an already worrying position.

I shall reflect on what the Minister has said. I am far from convinced that the financial flow system is sensitive enough to cope with these episodes of geriatric care. In particular, I do not believe that the evidence from abroad—and I may be out of date—gives a strong feeling of comfort in this specific area. It may well deal with whole swathes of activity, but I am less than convinced that in this specific area it will work in a sufficiently precise way.

I shall withdraw the amendment today, but we may well return to the subject on Report. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 4, as amended, agreed to.

Lord Clement-Jones moved Amendment No. 95:

    After Clause 4, insert the following new clause—

The Secretary of State or the Assembly may by order establish pilot schemes for the operation of this Part in selected areas."

The noble Lord said: A key theme and worry for everyone, other than those on the Government Benches, is the animus that the Government seem to have against social care providers. It has run throughout the debate. As I remarked yesterday to the noble Baroness, Lady Andrews, the Government appear to have a kind of Jekyll and Hyde approach. On the one hand, they talk about partnership and whole system approaches, while on the other—whether they are lapses of the tongue, I do not know—yesterday the noble Baroness talked of her worry that local authorities would hold the NHS to ransom. Today, the Minister talked about self-serving statutory authorities. It seems to me that underlying—

Lord Hunt of Kings Heath: And I had in mind both health and local authorities.

Lord Clement-Jones: The Minister has added that now, but certainly his first knee-jerk reaction was to use—

Lord Hunt of Kings Heath: I may not have expressed the matter clearly, but I was absolutely sure in my own mind that I was referring to the health service as much as to local government.

Lord Clement-Jones: I am glad that the Minister has put that on record. But there appears to be this overlying animus against social care authorities. The

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major example is the Government's unwillingness to enter into any kind of pilot scheme to see whether their proposals can be implemented in a sensible fashion and if they will work. I hope that now we have achieved a sensible start date for the Bill—and I certainly hope that the Government will not seek to move it—the Government will take the opportunity to undertake some pilot schemes to see whether or not this will work. That would be a reasonable approach.

Given the anticipated difficulties with the Bill, it is essential that proposals are piloted prior to any implementation, so that a proper assessment can be made of its effectiveness as well as its damaging effects. Despite what the Government say about their experience of Sweden, there is no clear evidence—in fact, particularly because of the Swedish experience—that the Bill will have the intended effect. In Sweden, delayed discharge levels remain at the same level as here—that is, 6 per cent bed blocking is still current—which suggests that the Government's proposed model is highly unlikely to produce the benefits they hope will be achieved. Indeed, there is substantial evidence that the proposals will not address the problems.

In Sweden local authorities are responsible for both health and social care, which does not involve the pitting of one agency against another as it will in England and Wales, where the situation is radically different. Cross-charging is a fallback position, rather than the backbone of the system as proposed in the Bill. Particularly crucial is the fact that in Sweden arrangements other than cross-charging are available by local agreement with central government approval.

There was a two-year lead in to the new regime, which was still not long enough to get things right at the outset. That causes strong concern about the proposals to implement the Bill, even in April of next year. It also highlights the need for these proposals to be piloted prior to any decisions about implementation being taken.

In Sweden, existing health and social care partnerships were damaged by cross-charging. It has taken them 10 years to recover and rebuild. In Sweden, municipalities directly control 80 per cent of the residential and home care markets. In England, the totally fragmented, partly privatised market makes that much more difficult. In Sweden, it has been demonstrated that having community health and social care services within one authority is very important. Dispersed services here make the model inapplicable.

In Sweden, the reforms also included a corresponding shift of resources to municipalities, equivalent to the cost of keeping patients in hospital where delayed discharge has occurred. That is not so here. The Government propose to transfer some 100 million per year for the next three years, but in July 2002 the Department of Health estimated the actual cost of delayed discharges to be 180 million per year. Therefore, there is a projected shortfall of 240 million over the next three years. It is clear that local authorities do not possess the resources to fund that gap.

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The Government bridle at the description of the Bill as "treating people like commodities", but it will mean that the focus of social care planning and implementation will shift to timescales and money, whereas it more properly should be on the patient and securing appropriate care. There will be a substantial distortion of care provision with far-reaching consequences. Local authorities will inevitably focus on trying to avoid fines and will therefore prioritise one-off care packages for those about to leave hospital rather than focusing on longer-term preventive services—for example, lowering the rate of unnecessary admissions.

The Bill will generate serious conflict between health and social care professionals, which can only damage already fragile partnership arrangements. There is a substantial risk that it will destabilise good arrangements already in place. If the Government disagree with that thesis, why not put in place a pilot scheme in order to demonstrate that we on these Benches and Members on other Benches are wrong? I beg to move.

Lord Hunt of Kings Heath: When I refer to failures in statutory services, I make it absolutely clear that I am referring both to the NHS and to local government. Since we debated the Bill at Second Reading, I have taken great pains to emphasise, first, that the NHS is as responsible as local government for some of the current failures in dealing effectively with delayed discharges; and, secondly, that the NHS will have to sharpen its act as much as will local government.

I re-emphasise the point made by my noble friend Lady Andrews that our concern is poor performance and poor practice, wherever it may be. It is clear that poor performance and practice adversely affect outcomes for the individual patients concerned.

As regards pilot schemes, I do not agree with the noble Lord on the matter. The first point is that already the NHS and social care services have existing responsibilities to discharge patients in a safe and responsible way. We are not introducing new responsibilities in that sense. We seek to put in place the right incentives to encourage both the health service and local government to do much better, in certain circumstances, than they do at present.

On the question of money, I have made clear that the larger figures that the noble Lord, Lord Clement-Jones, constantly cites embrace the cost to the NHS of dealing with delayed discharge, as well as that to local government. The figure of 100 million in a full year is our estimate of the actual cost to local authorities, which will be transferred from the NHS to local government.

The second reason I do not agree with the idea of pilots is that in the best performing authorities, health and social care partners are already working well together to reduce delayed discharges and to meet their responsibilities towards patients. The noble Lord cites Sweden. First, the Swedish changes were rather more

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fundamental than those that we propose because they included changes in service responsibility. We are making no change whatever to agencies and the services for which they are responsible. We are introducing a modest Bill to put in place the right incentives to enable improvements.

I have here an extensive list of local authorities that are doing magnificent work to improve the situation. Never mind Sweden: what about Barnsley? I have already cited its rapid response nursing beds in conjunction with private sector homes. That local authority has a particularly low rate of delayed transfers of care. A number of schemes are in place which have a strong focus on intensive rehabilitation and home care packages, with investment in additional staff and specialised equipment.

Never mind Sweden: what about Bristol? It has spent 88,000 on a rapid homes adaptation scheme, in conjunction with care and repair, to deliver 647 cases per year. There are many other examples in which good practice is already in place. There is no need for pilots. We really ought to get on with the job.

6 p.m.

Lord Clement-Jones: I thank the Minister for that exposition about Barnsley and Bristol—which anyone observing best practice would want to emulate. But the basic fact and the flaw in the Minister's argument is that no cross-charging is taking place in Barnsley or Bristol as we speak, nor is it intended to until the whole ramshackle edifice of the Bill comes into effect for the whole of the rest of the country. It is not a question of neatly targeting Barnsley and Bristol to see whether cross-charging will operate successfully there.

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