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Lord Hunt of Kings Heath: We should take the example of an issue that arises in an election. Is it not likely that, if such an issue arose, Ministers would have to answer for it and involve the Department of Health in a great deal of investigation, as well as the agency? That is the dilemma: the noble Baroness's amendments are well intentioned, but I cannot envisage a situation in which the agency would simply be given or would have the freedom that the noble Baroness suggested, without proper parliamentary accountability. Ultimately, MPs will continue to ask questions that Ministers will have to answer. The risk is that the agency will duplicate that, rather than taking its place.

Baroness Cumberlege: That depends on how the agency is set up. It depends on how the law is fashioned in order to prevent that happening. Of course, Members of Parliament must be interested in their constituency, but I am trying to get a space around the legitimate political activities of parliamentarians that allows the National Health Service to be well managed and to operate correctly.

I am grateful to noble Lords who took part. I am not sure that I mentioned my noble friend Lord Desai—I mean "the noble Lord, Lord Desai"; I think of him as a friend, but I am not allowed to call him that in the Chamber—who, I sense, suggested that he needed a government health warning. That is not true. I am sure that, when he mentions his colleagues and friends, it furthers their career, rather than diminishes it. Perhaps, however, the noble Lord does need a government health warning: he is not just new Labour, he is shining new Labour. His philosophy is that we cannot have a national health service run on Stalinist principles. We all say, "Amen" to that. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 2 to 6 not moved.]

Lord Clement-Jones moved Amendment No. 7:

(1) This section applies to the exercise of all powers and functions under this Part of this Act by—
(a) the Secretary of State,
(b) the regulator,
(c) an NHS foundation trust,
(d) the governors of an NHS foundation trust,
(e) the members of a foundation trust,
(f) an applicant under section 4 or 5,
(g) any trustees appointed under section 22.

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(2) The paramount consideration for those mentioned in subsection (1) above in the exercise of all powers and functions under this Part of this Act shall be the securing and advancement of the health and welfare of the people of England and Wales through the provision of an equitable accessible comprehensive health service free at the point of delivery and integrated with social services.
(3) The persons mentioned in subsection (1) must have regard to the following matters (among others)—
(a) the health needs of those who have received or may receive health services provided by the applicant or NHS foundation trust in question,
(b) the health needs of those who have received or may receive health services provided by other trusts within the area of the same Strategic Health Authority or by a clinical network of which the applicant or the foundation trust is a part,
(c) the views of the public constituency of the applicant or NHS foundation trust in question,
(d) the direct or indirect health impact of the exercise of any powers or functions on the health of the population served by the applicant or the NHS foundation trust in question,
(e) the equitable distribution of resources across the health service.
(4) For the purposes of this section "clinical network" shall mean a network of different NHS providers working together within a single supervisory structure to agreed protocols and standards of care.""

The noble Lord said: In moving Amendment No. 7, I shall speak also to Amendments Nos. 112 and 115. The amendments have a common theme, which is to try to establish some general principles to be applied to the exercise of powers by foundation trusts and by the regulator.

I am sorry that the noble Baroness, Lady Andrews, is not in her place. During the passage of the Adoption and Children Bill, we found it helpful that broad general principles were set out at the beginning. That was helpful to all concerned with working out how the powers of the various bodies referred to in that Bill were to be applied. The same should apply to this Bill. That is particularly important because of the way in which foundation trusts are being set up.

Amendment No. 7 would set out a framework of principles to guide the exercise of powers and functions relating to foundation trusts. Its purpose is to ensure that local autonomy in a foundation trust does not undermine the coherent development of comprehensive health services to meet local need. As I said, that mirrors the approach taken in the Adoption and Children Act 2002 and ensures that the intention behind the legislation is more clearly defined.

The persons named in subsection (1) of the proposed new clause are all those with functions or powers relating to foundation trusts. The amendment covers powers and functions exercised before and after individual foundation trusts are created, irrespective of whether the body applying is an NHS or non-NHS body. Under Clause 5, a body other than an NHS trust can apply to be a foundation trust. Although the department has asserted that that clause would be used only to allow hospices, for example, to apply for foundation trust status, it is clear that the clause gives the Secretary of State the power to entertain

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applications for public benefit corporation status and subsequent foundation trust status, under Clause 7, from a wider group of organisations. It is important that such bodies use their powers in accordance with the principles set out in the amendment to avoid any disruption to the overall objectives of the NHS. Currently, only the regulator is bound by a version of those principles set out in Clause 3.

Subsection (2) of the proposed new clause is a restatement of NHS principles derived from existing NHS legislation and policy, together with the objective of securing and advancing the health and welfare of the population. That objective is taken from Section 27(2) of the Health Act 1999, where it is identified as the purpose of co-operation between health authorities and local authorities. It seems to be a fitting and consistent objective for the greater plurality of provision that foundation trusts are meant to introduce. Subsection (3) would ensure that strategic NHS objectives were not in conflict with the autonomy to be given to foundation trusts.

What would that mean in practice? First, local needs—the needs of the population for primary care—would need to be taken into account as well as the needs of the hospital as an institution. Needs throughout a strategic health authority area and the interests of patients served by non-NHS foundation trusts in the same area must be considered by foundation trusts. That would, for example, avoid the poaching of staff by foundation trusts. There are also needs within a clinical network. Clinical networks may not be coterminous with the boundaries of strategic health authorities, so they must be dealt with separately. The clinical network is a vital way of ensuring clinical governance throughout a network of NHS institutions and of guaranteeing capacity in scarce resources, such as intensive care beds and renal transplant services. Decisions on such matters must be made throughout a large area, containing, perhaps, 2 million or more people. The interests of those in the intermediate area of the foundation trust must not override those in further-flung parts of the network.

The views of local communities must be taken into account, but they are given insufficient prominence in the Bill. There is the health impact. Providing care in a less accessible location creates health disadvantage for those who must travel further at their own expense. Health impact must, therefore, be considered over institutional interests.

There must be equitable distribution of resources throughout the NHS. The amendment addresses the risk of inequitable access to capital through unregulated borrowing by foundation trusts. The fact that such borrowing counts against the overall capital spend of the NHS means that non-foundation NHS trusts may find their spending curtailed by what the foundation trusts decide to borrow. The amendment would require equity with the rest of the NHS to be considered.

There is a definition of clinical networks, which is derived from the report of the neo-natal intensive care review, published by the Department of Health in

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2003. The networks are particularly vital in ensuring that the right patient is offered care in the right place. Patients must be treated in hospitals with the capacity and expertise to treat their conditions. That is particularly important in the treatment of cancer. Patients with complex cancers must be referred to specialist hospitals. It would not be in the patient's interests if a clinical network for cancer is undermined by the autonomy of a foundation trust, perhaps wanting to provide specialist services which are better provided elsewhere.

Amendment No. 112 states that one of the objectives of the regulator is to ensure,

    "specifically that adequate numbers of training posts are provided in the new foundation trusts and that their relationships with deaneries [are] maintained".

The Minister is well aware from questions asked on previous occasions that there is considerable concern about the role of teaching hospitals and whether resources will be available if and when foundation hospitals take root.

Finally, on Amendment No. 115—and this is specific to the regulator rather than relating to foundation trusts as well—we believe that the proposed arrangements for the regulator are ill thought through and could have an adverse impact on the NHS. In particular, we are concerned that the regulator will be unaccountable and that he will be free to take decisions that do not reflect the values and principles of the NHS.

We are concerned that in Clause 3 the general duty on the regulator is unclear and fails to place a legal obligation on him to act in accordance with the values and principles of the NHS. Clause 3 requires only that the regulator acts in a way that is consistent with the performance by the Secretary of State of his duties under Sections 1, 3 and 51 of the National Health Service Act 1977, rather than requiring the regulator to act in pursuance of those duties. That could mean, for example, that the regulator could authorise the withdrawal of a particular service by a foundation trust, leaving it to the Secretary of State to make good any gaps that might result in the local provision of services.

Furthermore, while Section 1 of the 1977 Act makes it clear that NHS services must generally be provided free at the point of use, no mention is made of other important principles at the heart of the public's understanding of the nature of the NHS, such as the principle of equality of access to treatment. For instance, would the regulator be under an obligation to prevent cherry-picking of patients by foundation trusts? These issues of principle raise a great many questions for the Minister. I look forward to his reply. I beg to move.

5 p.m.

Baroness Finlay of Llandaff: I support the group of amendments. In particular, I have added my name to Amendment No. 115. I reiterate the words of the noble Lord, Lord Clement-Jones, about the importance of equity for patients.

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Clinical management has become increasingly complex. Patients move between different providers of care within the context of clinical networks. It is becoming increasingly difficult for a patient with a complex clinical problem to be managed solely within the confines of one NHS trust. There are, therefore, very important principles of equity. Patients must be able to be moved to and to receive care from clinicians employed by one trust although they have had their principal treatment instigated in another trust. There must be close collaboration and co-operation between trusts to ensure uniform standards of care and management of patients.

I must also declare an interest as a vice-dean of a medical school. Aspects relating to research and teaching are incredibly important. If we do not teach adequately the next generation, we shall not produce competent clinicians. The juniors of today need good role models. The power of role models as teachers cannot be underestimated. Such teaching is much more powerful than sitting people down in a lecture theatre, sending them on a course or giving them something to read. Juniors need to work with people who have time to teach them. They also need to learn how to do research and to do it well, as opposed to wasting time on badly done research that delivers inconsequential results.

However, academicians within the teaching hospitals have multiple pressures on them. They have pressures to deliver research for the RAE, and to teach both undergraduates and postgraduates. They are clinicians also and have clinical pressures with the immediacy of the patient before them. It would be very easy for management to increase that pressure further, which is already excessive on many clinicians, to deliver against set targets, particularly if some performance targets risk that trust losing its star status or however else the targets are to be measured in the future. Therefore, there is a very important principle of equity. There is also a very important principle enshrined in the amendments; that is, that we look forward to educating and researching for the next generation and not simply to providing for today's care.

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