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Lord Hunt of Kings Heath: The point is that I suspect that there will be no penalties or cross-charging in Barnsley, because it has worked intensively for at least four years to achieve a genuinely integrated approach to deal with those issues. That is the lesson. I do not want the system to have to be used at all. I hope that all local authorities and health services will recognise that if they follow the Barnsley path, the Bristol path, or that of other local authorities that I mentioned yesterday, there will be no need for penalties. This is a back stop with the right incentives so that statutory agencies at local level know that if they do not get their act together, they will be penalised—and so they should.

Baroness Noakes: The Minister is aware that local authorities and health bodies have been running a simulation to find out how the system will work in practice. He said that there will be no fines in Barnsley. He does not know that. When the simulation was run, unexpected things happened. That is what happens when such things are worked through.

It is quite possible that Barnsley, which is working well through a spirit of partnership, will find that spirit of partnership destroyed because, as we have suggested, manager will be set against manager in different parts of the system. The Bill will produce incentives for the wrong things to happen—including

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premature discharge. The Minister has not tested how the system of fines will work in practice: that is what pilot schemes are all about.

Lord Clement-Jones: The noble Baroness, Lady Noakes, is correct. That is the law of unintended consequences, to which this Government are as subject as any other public body. The mechanisms—the notices and requirements on both sides of the care/health divide—set up under the Bill are complicated and extensive. They will apply just as much in Barnsley and Bristol as anywhere else in the country. If they are not piloted, we fear that the Bill will be an accident waiting to happen and that priorities will be completely skewed.

In a sense, I suppose that I should be impressed by the Minister's sheer chutzpah and confidence in the quality of the Bill's proposals and the optimism with which he looks forward to its full implementation, knowing that it will apply only to a small number of recalcitrant local authorities—and, perhaps I should say, some NHS bodies as well, who must obviously incur the Minister's wrath in order for him to be even-handed. We on these Benches are far less confident. I fear that the Bill is hurtling down a stony track, but only time will tell. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 96 not moved.]

Clause 5 [Ordinary residence]:

[Amendment No. 97 not moved.]

Clause 5 agreed to.

Clause 6 [Dispute resolution]:

Lord Clement-Jones had given notice of his intention to move Amendment No. 98:

Page 5, line 28, leave out "may" and insert "shall"

The noble Lord said: It is vital under the terms of the Bill to ensure that the patient has the right to a speedy disputes mechanism that covers concerns that he or she may have about future NHS or social services care and that, while the dispute is being investigated, he or she should not be moved out of NHS provision.

It is manifestly unfair that, under the Bill, the health service, which will be levying fines on local government, should have sole responsibility for creating and maintaining the dispute panels as currently envisaged under Clause 6(1). Local dispute panels with an independent membership jointly agreed between the health service and local government would be far preferable, with adjudications of the panels binding on all parties, including local authorities.

I am sure the Minister will pray in aid the terms of the regulations which have emerged since the Commons debated the matter, but the terms of the dispute panel state clearly that there will be one representative of the NHS—who it appears will be an employee or officer of the NHS—one representative of local authorities, who will be determined not to have a conflict of interest in the case, as is right and proper, and a chairman, who is said to be independent of both

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NHS and local authorities. But they are determined by the NHS. The strategic health authority will effectively determine the composition of the panel. That is not right. Is not the way forward to have local authorities and the health service agree on the composition of the panels?

I know that the Minister reads European human rights cases extremely carefully. He may want to consult Salesi v. Italy, which recently emphasised the importance of independence in quasi-judicial administrative tribunals. That is an important case in the light of the way the Government intend to set up the panels. The amendments are intended to ensure just the kind of independence that the European Court of Human Rights has determined is appropriate. I hope that the Minister will consider how the dispute panels are to be set up by both the Bill and regulations under it.

Lord Hunt of Kings Heath: Clearly, the noble Lord is not interested in the "may" or "shall" debate, so I shall not respond to it. His comments relate to the next group. Will the noble Lord allow us to move on to that group, as the points that he raised are much more relevant to it?

[Amendment No. 98 not moved.]

Earl Howe moved Amendment No. 99:

Page 5, line 28, "Authority" insert "and local authority"

The noble Earl said: I am grateful to the Minister and the noble Lord, Lord Clement-Jones, as this is a more convenient way of ordering the business. As the noble Lord, Lord Clement-Jones, explained, we are back to the recurring theme of our Committee debate: equity and fairness.

The Bill properly provides for dispute resolution procedures to sort out the disagreements that are bound to occur between the NHS and local authorities on the penalties that the Bill imposes. Most would think it fair that such a procedure should be biased neither one way nor the other but that the composition of the panel should as far as possible be neutral and objective. Yet what do we find? The health service alone is to be responsible for setting up the panels that will adjudicate those disputes. Strategic health authorities, presumably in their well-advertised role as "head-bashers", are tasked with establishing and maintaining the panels. They may protest that they will be fair and even-handed, but we all know that it is not simply a matter of justice being done, but also about justice being seen to be done; hence the amendments that provide that local authorities should share the responsibility of setting up the panels.

I speak also to Amendments Nos. 100, 102, and 104 to 107 inclusive. Although the draft regulations are partly reassuring as to the composition of the panels, they are also vague. It is unclear, for example, how strategic health authorities will set about establishing panels. Will it be up to the strategic health authority to select the local authority member, or can the local authority submit its own nominee? There is to be a neutral chairman; but, if the choice of chairman is

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purely up to the strategic health authority, it leaves open the question of whether he or she enjoys the confidence of the local authority, which is an important issue. It would be helpful to have the Minister's explicit reassurance on those questions, if we are not to need a set of regulations to implement the implementing regulations. For those reasons my amendments would provide that the panels have independence from both the NHS and local government; that the chairman should be independent; and that the panels should comprise not only health service nominees but local government nominees also. There are strong arguments for such provisions.

Unless such a structure is put in place, we will have local authorities feeling aggrieved when a decision goes against them, because of the perception that the NHS is protecting itself. It is misleading to regard the acute trust and the strategic health authority as separate bodies in this context. They are both parts of the NHS, which is another reason why I find it uncomfortable that the very body responsible for imposing fines should be responsible for establishing the dispute panel. It already has a financial interest in ensuring that decisions go in a certain direction. I hope that those remarks will not be taken amiss by anyone in the National Health Service. But the approach looks wrong.

It is inexplicable that, under this dispute procedure, the panel's decisions are to be merely advisory. The Explanatory Notes say that the panel's recommendations are,

"not formally binding, although it is hoped that the recommendations will be accepted in most cases".

I am not sure what is meant by "formally" in that sentence. The panels will have a statutory underpinning in primary legislation. If their recommendations are not intended to bind the parties to the dispute, it is hard to see their point. The panels will have still less point if they are perceived as creatures of the NHS—a guaranteed excuse, if ever there was one, for their recommendations to be freely ignored.

The Minister may reply that the point of the panels is to prevent litigation. That is a worthy aim, certainly, but I do not understand how a panel that will be seen as lacking in objectivity will succeed in persuading the parties to desist from legal action. That thought brings us back to where we began; that is to say, the necessity—as I see it—of inserting amendments along the lines of those that I tabled. I beg to move.

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