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The processes of registration and of managing serious failure through appointing trust special administrators are inextricably linked and this escalation needs to be smooth and co-ordinated. To enable that, the CQC needs to be involved in the whole process, which I think needs recognition in primary legislation. Once the trust special administrator is appointed and has published a draft report stating the actions he or she recommends to the Secretary of State, there is a 30-day consultation period of the plan. While a number of other relevant organisations must be consulted—we have already discussed staff—I find it really surprising that it does not include the Care Quality Commission. The CQC should be included on this list because any changes made to services would involve it in varying the registration of those services. We could easily land ourselves in the unfortunate position of a trust special administrator proposing a reconfiguration which the CQC found to be unregistrable.

I can understand that the Minister may wish to argue that if this exception is made it may open the floodgates to many other organisations which wish to be a statutory consultee. However, in my mind, none would seem to be quite as relevant as the CQC, with its special duties and the information it possesses. Alternatively, the Minister may argue that the CQC would be consulted as a matter of course. However, given that the CQC will be inextricably linked in these processes, it seems sensible to eliminate doubt and to make it clear in the Bill. I beg to move.

Lord Darzi of Denham: Amendments 74A, 78A and 80A laid by the noble Baroness, Lady Cumberlege, would require the Care Quality Commission to be consulted before a trust special administrator is appointed and in the production of the draft report. Let me begin by making it clear that the CQC will play a vital role within the overall quality framework and in our reform agenda more broadly. The CQC, through its statutory functions, has a key improvement role in terms of demonstrating solid improvement in the safety and quality of care over time. Done well, the CQC’s registration and assurance roles, which demonstrate that providers are getting the essentials right and taking independent enforcement action to bring them

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back into compliance where they are not, have very real potential to shift the improvement bell curve on a permanent, sustained basis and to drive real local ownership and leadership for quality.

Amendment 74A and 78A would add a requirement for the Secretary of State in the case of NHS trusts and Monitor, in the case of foundation trusts, to consult the CQC in advance of the trust special administrator being appointed. The CQC will be aware of any quality issues that result in unsustainability from its ongoing assessment and registration process. In the case of NHS trusts, discussions are currently under way between the Department and the CQC on how registration and assessment can feed directly into the NHS performance regime.

The decision to enter an organisation into an unsustainable provider regime is a performance management issue. Any quality assessment made by the CQC is likely to affect that decision, but the decision to trigger the regime is a performance management one. This is why the Secretary of State and Monitor consult only the strategic health authority and relevant commissioners. It is likely to be the last stage in a long stream of interventions, some of which, in terms of quality, may actually have been made by the CQC.

It is important to be clear that at the moment of appointment, the trust special administrator makes no decision about the organisation’s future and existing services are all maintained. A decision will not be made until approximately six months later, after the trust special administrator has had an opportunity to research the issues and consult on the proposals, and has made a recommendation to the Secretary of State. The appointment itself has no impact on the provision of services or on quality so there is no need for the CQC to be directly involved before the trust special administrator is appointed.

If the CQC has concerns about quality of services at any time, it will be able to raise these with the Secretary of State through powers in the Health and Social Care Act 2008. The provisions do not change this.

Therefore, I am happy to offer reassurance that, were the regime to be triggered, my right honourable friend the Secretary of State, in addition to laying a notice in Parliament, would also notify the CQC of this action.

Amendment 80A places a requirement on the trust special administrator to consult the CQC when preparing the draft report. I recognise the concerns that have been raised, highlighting that unsustainable organisations are likely to have quality issues, particularly as there is often a link between poor quality and financial problems, but this is not always the case. Indeed, the Healthcare Commission’s annual health check identified several organisations that scored “good” on quality of services and “weak” on the use of resources. This demonstrates that it is possible that some organisations may fall into the unsustainable provider regime for solely financial reasons. In these situations it may not always be appropriate for the trust special administrator to be required to consult the CQC in producing a draft report.

Baroness Young of Old Scone: I know that this is probably infringing the Addison rules yet again, but so be it. The point that needs to be drawn out on

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Amendment 80A is not necessarily that of the CQC’s role as the quality regulator but the fact that it has to register the pattern of services to be permitted to operate. If the pattern of services proposed by the special administrator was one that the CQC did not find registrable, it would therefore be at odds with the special administrator’s proposals. It seems to me that the amendment of the noble Baroness, Lady Cumberlege, avoids the risk of the special administrator coming forward with something that the CQC did not find registrable. It would be unfortunate if the special administrator put a proposal to the Secretary of State that was challenged by the quality regulator during the consultation period on the ground that he considered it was not sustainable.

I am trying desperately to think of an example. A special administrator could come forward with a proposition to dissolve the services of a trust and reconfigure them into a different configuration with other trusts that the regulator did not feel were capable of being carried out at the requisite level of quality because it already had doubts about the trust or felt that the guidance given by a particular professional body, or by NICE or other independent source, militated against the proposed configuration being a good one. It is better to avoid to avoid that sort of debate arising after the special administrator has put forward his proposition rather than before. Indeed, the noble Baroness, Lady Cumberlege, has rightly pointed out the issue.

3.45 pm

Lord Darzi of Denham: I am grateful for the intervention of the noble Baroness in relation to the CQC’s role after a draft report has been issued by the trust special administrator. New Section 65N makes it clear that the guidance will make reference to,

I expect the trust special administrator to engage directly with the CQC where appropriate, and the guidance will support that. However, the issue is whether the trust special administrator should consult the CQC before the report is published. The noble Baroness makes the important point about the service in question being registered; I cannot see the logic of the administrator not consulting the CQC while the draft is being put together to ensure that it at least has the buy-in of the regulator before the report is published.

I think that I made it clear that once this is triggered, it is a performance rather than a quality issue, but if the report concerns reconfiguring services, no doubt bodies such as the independent reconfiguration panel will have more information about how services should be run. I hope that through the process itself, a high regard will be given to the registration requirements of the regulator before the draft report is put together—not only the regulator, but also the commissioners involved in issuing it.

I hope that my explanation about the operation of the scheme reassures the noble Baroness. I have no doubt that we shall debate this further, but I hope that she will feel able to withdraw the amendment.



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Baroness Cumberlege: I thank the Minister for that response, and I thank the noble Baroness, Lady Young, for her intervention. I am also grateful for the information about the notification issue. I understand the noble Lord’s reluctance concerning the appointment of a trust special administrator, and that may be something I need to reconsider. In return, perhaps the Minister will take away his last thoughts on the registration issue. It would be a good idea to get that clarity into the Bill so that we all know where we stand. I beg leave to withdraw the amendment.

Amendment 74A withdrawn.

Amendments 75 to 78A not moved.

Amendment 78E had been retabled as Amendment 78A.

Amendment 79

Moved by Earl Howe

79: Clause 13, page 12, line 14, leave out “a National Health Service” and insert “an NHS”

Earl Howe: In moving this amendment, I descend once again and with some apologies into the realms of drafting. I do not understand why throughout new Chapter 5A of the 2006 Act, an NHS trust is referred to as an “NHS trust” except on line 14 of page 12, where suddenly it is referred to in its unabbreviated form as a “National Health Service trust”. I hope that the Minister can enlighten me on why this should be, and I beg to move.

Lord Darzi of Denham: This is the lawyers at their best. Amendment 79 is a technical amendment to replace the words, “a National Health Service” with the words “an NHS” when referring to de-authorised foundation trusts. The drafting of the Bill and the use of the full title is intentional, as new Section 65E of the National Health Service Act 2006, to be introduced under Clause 13, creates an entirely new type of National Health Service trust; that is, a trust that used to be an NHS foundation trust and was not established in the usual way by order of the Secretary of State.

In these circumstances, the full National Health Service trust title is used in new Section 65E(4) for two reasons. First, the term “NHS trust” is just a shorthand way of referring to National Health Service trusts, so I am advised that it is appropriate that the first time we refer to this new species of National Health Service trust, we use the full designation and not the shorthand title. Secondly, Section 25 of the National Health Service Act 2006, which provides for the Secretary of State to establish National Health Service trusts by order, uses the full designation. New Section 65E(4) will do a similar job for the new type of National Health Service trust to the job done by Section 25 of the Act for ordinary trusts. They both provide for the creation of a type of National Health Service trust and the full designation is appropriate.

I should also point out that Clause 16(9) amends the interpretation provision of the 2006 Act. This is so that the shorthand references to “NHS trust” elsewhere

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in the Act include both trusts established under Section 25 of the Act and those created by new Section 65E. This ensures that the provisions of the Act governing NHS trusts apply to the de-authorised foundation trusts.

I hope that that careful, complex explanation will allow the noble Earl, Lord Howe, to withdraw his amendment.

Earl Howe: I am glad I asked that question. We have discovered a new species, which must always be a good thing. I am grateful to the Minister for enlightening us as he has. I beg leave to withdraw the amendment.

Amendment 79 withdrawn.

Amendments 80 and 80A not moved.

Amendment 81

Moved by Earl Howe

81: Clause 13, page 15, line 9, at end insert “with a report stating the reasons for the decision”

Earl Howe: I mentioned earlier that when the Secretary of State makes an order to appoint a trust special administrator, he must lay before Parliament a report stating the reasons for making the order. In the same way, I believe that there is a strong argument for insisting on transparency when the Secretary of State takes a decision in the light of the report that he receives from the trust special administrator. That report will contain a recommendation for certain action to be taken. The Secretary of State will either accept that recommendation or not accept it. In either case, I believe he has a duty to explain his reasons.

New Section 65K obliges Secretary of State simply to publish a notice of his decision and lay a copy of the notice before Parliament. I stand to be corrected on this, but I believe that the notice will say nothing of the rationale that lies behind it. Of course, the administrator’s final report will already be in the public domain, as we see from new Section 65I. If the Secretary of State decides to follow the recommendation in that report, he need only cite as his reasons for doing so those which the administrator has himself given. If on the other hand the Secretary of State decides to follow a different course, what then? Are we to fall back on the Freedom of Information Act before being able to discover why? That does not seem satisfactory when one considers what a highly charged decision this will be in political terms.

I would be grateful if the Minister could tell us why in this part of the Bill there is an apparent lack of transparency in the sense to which I have referred. I beg to move.

Lord Darzi of Denham: Amendment 81 requires the Secretary of State to lay a report before Parliament along with the notice of his final decision. Having listened carefully to the concerns raised, I hope that I can assure the noble Earl and the noble Baroness that the amendment is not necessary and set their minds at rest.



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First, the Secretary of State has a duty to take into account the report of the trust special administrator when he makes his final decision. In making the decision, the Secretary of State is under a duty to act reasonably and to take into account any relevant information in doing so in accordance with the ordinary principles of public law. He will have to have good reasons for departing from the trust special administrator’s recommendations.

The Bill requires the Secretary of State to publish the trust special administrator’s final report and lay both the draft and final reports before Parliament. It also requires the Secretary of State to lay the decision before Parliament, which means that Parliament will of course be able to scrutinise this decision through its usual mechanisms. I hope that I have been able to reassure the noble Earl and the noble Baroness that there is a duty on the Secretary of State to lay the draft and final reports of the trust special administrator as well as the decision before Parliament.

Earl Howe: I thank the Minister for that reply, which partially reassures me. I am always anxious to spare Ministers the prospect of judicial review. If we can arrange things so that the law obliges Ministers to be as transparent and open as possible about the reasons for their decisions, it will avoid unnecessary heartache, effort and expense for those who object to those decisions. I take the point that Parliament will be able to scrutinise the decision. It would be helpful to Parliament if there were an explanation of the Minister’s decision published at the same time as the decision itself. Nevertheless, I note what the Minister has said; I do not think that there is anything more I can add, and I beg leave to withdraw the amendment.

Amendment 81 withdrawn.

Clause 13 agreed.

Clause 14 agreed.

Schedule 2 agreed.

Clauses 15 to 17 agreed.

Schedule 3 agreed.

3.58 pm

Sitting suspended.

4.08 pm

Clause 18: Prohibition of advertising: exclusion for specialist tobacconists

Debate on whether Clause 18 should stand part of the Bill.

Earl Howe: We move now to Part 3, the provisions relating to tobacco control, and I raise a question in relation to Clause 18. The Tobacco Advertising and Promotion Act 2002 included an explicit exemption for specialist tobacconists from the legislation banning advertising. It did so subject to three conditions: that the advertisement had to be inside or fixed to the outside of the premises; that it could not be for cigarettes or hand-rolling tobacco; and it had to comply

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with regulations governing advertising in specialist tobacconists. Clause 18 removes this explicit exemption by giving the Secretary of State the power to decide whether the exemption should remain. In other words, it removes the existing certainty for specialist tobacconists under the 2002 Act. Questions need to be asked about why the explicit exemption currently in place needs to be removed and why the existing power to make regulations under the 2002 Act is insufficient. The Explanatory Notes shed no light on these issues.

Lord Naseby: I support my noble friend on the Front Bench. I do not want to be repetitious but if you are running a specialist tobacco shop you must have a degree of certainty about the future. The one thing you cannot have when taking a new lease, extending a lease or entering into contractual arrangements with anyone else is a situation where it is entirely at the whim of the Secretary of State to amend the regulations. As it stands in the existing tobacco Bill, the matter is quite clear and such forward planning is possible. Under what is proposed here, it is not possible, and that is desperately unfair to anyone trying to run a business.

Baroness Thornton: The clause, together with Schedule 4, replaces the automatic exclusion for specialist tobacconists from existing legislation on tobacco advertising currently provided by Section 6(1) of the Tobacco Advertising and Promotion Act 2002. It instead enables the Secretary of State, Welsh Ministers and the Department of Health, Social Services and Public Safety in Northern Ireland to make separate regulations on when and where tobacco specialists, as defined by the Tobacco Advertising and Promotion Act 2002, may be exempt from the prohibition on tobacco advertising.

The current provision in the Tobacco Advertising and Promotion Act 2002 provides an automatic exemption for specialist tobacconists from all the prohibition on advertising specialist tobacco products on their premises. That means tobacco products other than cigarettes or hand-rolling tobacco, such as cigars and pipe tobacco.

In line with the proposed prohibition of tobacco displays, the Government’s overall aim is to remove all promotion or advertising of tobacco that is regularly accessible to children. It would be inconsistent to remove tobacco displays from all other shops but to allow specialist tobacconists to continue with a blanket exemption, but we are mindful of the need to take a proportionate approach.

The clause will allow the Government to extend existing rules on tobacco advertising to specialist tobacconists, while still being able to exempt them where that is deemed appropriate. The Government’s intention is to maintain the general exemption but the power would enable us, for example, to prohibit advertisements outside specialist tobacco shops or in shop windows where these are in view of the general public, including children and young people.

Our intention is that specialist tobacconists will still be able to advertise tobacco products other than cigarettes or hand-rolling tobacco and display tobacco products inside their shops. We understand from our contact and discussion with the specialist tobacco industry that approximately 50 shops in England fall into this

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category. We also understand that many specialist tobacconists have voluntary policies in place not to admit persons under the age of 18 on to their premises. That is a highly responsible practice that the Government would encourage across the specialist tobacconist sector. We also understand from the industry that the majority of customers of specialist tobacconist shops, a very stable customer base, are aged between 36 and 60 years of age, and generally have already decided to purchase specialist tobacco products, such as pipe tobacco or cigars before entering the shop.

We will work with representatives of the specialist tobacco retail trade to develop the detail of how the powers will be used in practice. Any requirements would be introduced with a long lead-in time and would not come into effect until 2013, in line with display requirements for smaller shops. We intend that regulations made under this new provision will help to ensure that children are effectively and comprehensively protected from the promotion of tobacco, while ensuring that any restrictions on specialist tobacconists remain proportionate to the problem.

For these reasons, we consider Clause 18 to provide a vital element of the new tobacco controls proposed in this Bill, without which the overall package on removing tobacco displays would be incomplete. I therefore recommend that Clause 18 stand part of the Bill.

Earl Howe: I thank the Minister for her reply. I still do not quite understand why the existing provisions in the 2002 Act, which enabled Ministers to make regulations, are not sufficient for the purposes that she outlined.

Baroness Thornton: I think that I have given a reasonable explanation. We intend to consult and are indeed in discussion with the Association of Independent Tobacco Specialists. We want to be sure that the prohibition of tobacco advertising intended to protect children and young people from the promotion of smoking is comprehensive. Therefore, we need to consider the regime that covers independent tobacco specialists, but we are doing that in consultation with them. The clause would still allow advertising outside of their shops.

Lord Naseby: That is nonsense. There is an existing provision; we have 50 outlets; the age group who go in to the outlets are in their mid-30s or beyond, into their 70s. In any case, the ministry is consulting. No young people go into those shops. I suppose someone sitting in the ministry wants to achieve this for pure tidiness, but it is nonsense and I hope that the Government will think about the provision once again before Report and perhaps withdraw it.

4.15 pm

Lord Stoddart of Swindon: There are only 50 shops. Did I hear that right?

Noble Lords: Yes.


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