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Lord Warner: My Lords, no one can but admire the consistency and persistence of the noble Baroness, Lady Cumberlege, in this area. I pay tribute to her willingness to run a marathon. Perhaps I may gently suggest that whatever training schedule she undertakes, even one as demanding as that of Paula Radcliffe, I am not sure that at the end of it she will necessarily have convinced us in this particular area.

I am grateful to the noble Lord, Lord Clement-Jones, for his views on the radicality of the Department of Health review and the review of arm's length bodies. All I would gently say to people who ask for an independent review is that it is fairly common practice in the public and private sectors for

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organisations to review themselves before turning themselves loose on an independent review. It is common practice to take stock of where you have got to in the history of your activities to see whether you should change practice. That is what the Government are doing as regards the Department of Health review and the review of arm's length bodies.

Although Amendment No. 373A would not establish an agency, it would make it a requirement for an independent review to be carried out on the delivery of the Government's health policies, including the case for setting up an agency. It will not surprise noble Lords that the Government think that it is for Parliament to debate the arrangements for the delivery, scrutiny and accountability of the Government's health policies. That is just what this House and another place have done during the passage of the Bill in relation to the creation of NHS foundation trusts.

I also remind the noble Baroness of the existence of the Select Committee on Health, whose function as defined in its terms of reference is to examine on behalf of the House of Commons the expenditure, administration and policy of the department and its associated bodies.

How would a review into how this Government deliver, scrutinise and account for their health policy be any different to those reports already undertaken by the health Select Committee? There is also the issue of stability, which we tried to put on the record at the last discussion of this issue. How will a review within 18 months of commencement of the first provisions of the Act—or, indeed, according to this wording, possibly within 18 months of the commencement of the last provision of the Act—help to create stability for people working within these organisations, and for those on the outside? That would be a destabilising move. The requirement that the independent review look into the case for setting up an NHS agency is a matter for the Government. I believe that in Committee I set out good reasons why such an agency was not necessary. I do not intend to repeat those reasons over and over again. I would just briefly say that the issue of accountability to Parliament is for Ministers.

Secondly, there is the possibility—and I repeat this despite the fact that it is unacceptable to one or two Members of your Lordships' House—that an NHS agency could create just the kind of centralised model of control over the NHS that we all do not wish to see. One cannot guarantee that setting up that agency would not have that particular effect.

We do not believe that it is right to move in the direction—

Lord Clement-Jones: My Lords, I am absolutely fascinated by the Minister's analysis. Can he answer this question. How many NHS reform Bills have there been since the Government came to power? The

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Minister was talking about creating instability and so on. That does not seem to have been a consideration of any previous Secretary of State.

Lord Warner: My Lords, the sinner who repents, I would have thought, should be welcomed in this House.

Amendment No. 373A would require us to carry out a review within 18 months of commencement of the Act. We do not think that that is appropriate. On the point raised by the noble Lord, Lord Clement-Jones, about reducing the number of regulatory bodies, the Bill reduces the number of bodies which inspect and review health and social care. As we have said on previous occasions, there is the Better Regulation Task Force, to which the Government will be responding before the end of the year.

Baroness Cumberlege: My Lords, I thank my noble friend Lord Howe, the noble Lord, Lord Clement-Jones, and the noble Baroness, Lady Finlay, for supporting the amendment. Noble Lords will remember that when we discussed this issue in Committee only one noble Lord, besides the Minister, rejected the concept.

I like the idea of the regulator being the twinkle in the eye. I am sure that that will attract many people to the post. The purpose of the review is to sort out the relationships between Parliament, between government, between regulation, and between all the new bodies that have been set up. The noble Lord, Lord Clement-Jones, is absolutely right. From time to time we get more bodies added. Yet, it is like Topsy; we do not know where it is going, how it is growing or what the implications will be when it is seen as a whole.

I reject totally the Minister's suggestion that it is only for bodies to look at themselves internally, especially when they are accountable to the nation as a whole. I think the noble Lord has only to look to see what Defra has done. An independent body was set up under the chairmanship of the noble Lord, Lord Haskins, to do something which the Government clearly thought was very sensible indeed.

We think that perhaps the National Health Service has an even greater role to play in the nation's affairs than Defra. The National Health Service affects so many lives. It seems to us right that this internal review should take place. I shall think very seriously before bringing the matter back at Third Reading. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 121 [Power to assist]:

Lord Warner moved Amendment No. 374:

    Page 54, line 3, leave out "body" and insert "authority"

The noble Lord said: My Lords, Amendments Nos. 374 and 375 are technical amendments designed to ensure that, as was always intended under Clause 121, CHAI and CSCI might provide assistance to individual persons such as Ministers or inspectors of schools.

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Amendments Nos. 374 and 375 remove the reference to a "public body" and replace it with a reference to "public authority". Parliamentary counsel advised that there was a risk that "public body" could be construed as referring only to corporate bodies, and exclude individual persons such as Ministers. "Public authority" ensures that individual persons are included. As I said in earlier debates, that will allow the Secretary of State to ask CHAI and CSCI to work with other inspectorates on work such as the street crimes initiative. I beg to move.

On Question, amendment agreed to.

Lord Warner moved Amendments No. 375 and 376:

    Page 54, line 4, leave out "body" and insert "authority"

    Page 54, line 5, leave out subsection (2).

On Question, amendments agreed to.

Clause 126 [Reports: CHAI]:

Earl Howe moved Amendment No. 377:

    Page 56, line 5, at end insert—

"( ) a statement showing the ways in which the CHAI has taken steps during the year to minimise the regulatory impact of its activities."

The noble Earl said: My Lords, I shall speak also to Amendment No. 378. The amendment reprises in a slightly different form the case that I attempted to make in Committee that CHAI and CSCI should be required as a statutory discipline to demonstrate that they are making conscious efforts to minimise the burdens that they place on those whom they inspect and audit.

The Minister made some powerful points in Committee and Sir Ian Kennedy has said some encouraging things about ensuring that CHAI does not descend on an organisation when it does not need to. We can only welcome that approach. Nevertheless, we will not always have Sir Ian Kennedy at the helm of CHAI. The best run organisation can easily start to slip backwards and adopt less than desirable habits.

The principles of good regulation—which are not the same as economy, efficiency and effectiveness—should be followed by every regulatory body, year in and year out. Those principles are transparency, accountability, proportionality, consistency and a duty to act only where necessary. To require the body to state in its annual report the ways in which it has sought to adhere to those principles—in other words, the practical steps that it has taken to do so—does not seem a great deal to ask.

The Minister said that he would read my previous amendment and consider whether anything more needed to be done in the light of the Better Regulation Task Force report. I look forward to hearing what he has to say in that regard. I beg to move.

Baroness Howarth of Breckland: My Lords, although accepting that all regulation must be efficient and effective, I hope that the noble Earl does not assume that inspection and regulation always have a negative impact. We should also recognise the value

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and benefits to service users; we should not always consider the difficulties caused but also the benefits in quality and improvement of service.

Lord Warner: My Lords, as the noble Earl said, in Committee, we debated amendments that would have required CHAI and CSCI to publish updated regulatory impact assessments showing the effect of their activities on the bodies that they regulate. As I mentioned during that debate, the Better Regulation Task Force report on independent regulators recommended that all regulators should make available for scrutiny a regulatory impact assessment on all new major policies or initiatives. It did not, though, recommend an annual regulatory impact assessment.

I then offered to consider further what we might be able to do in light of the report. The Government will be responding to the report before the end of the year and will probably begin to implement the recommendations that we accept during 2004.

In the case of CHAI and CSCI, if the Government decide to accept the task force's recommendation in relation to a regulatory impact assessment for new policies and initiatives introduced by regulators, my view is that that will not require an amendment to the Bill. Instead, under Clauses 128 and 129, the Secretary of State could direct CHAI and CSCI to have regard to the Government's response to the Better Regulation Task Force report, if that was felt necessary to ensure that the commissions did so. We are already considering whether we can indicate our likely response to that particular recommendation in relation to CHAI and CSCI.

The new amendments as tabled would require an annual statement about the activity of the inspectorates. It could be an additional burden on the regulated bodies. As I said, the Better Regulation Task Force has not recommended that, and, in my opinion, it would be unnecessary. In any event, the inspectorates could include in their annual reports any information about regulatory impact that they deem necessary to carry out their functions under the current provisions in the Bill.

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