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This is a concern both in dealing with the patients who might be turned away from essential care if their direct payment runs out and in relation to the risk that the NHS might be left to foot the bill in situations where a patient spends their direct payment inappropriately. This would, in effect, leave the National Health Service, in the view of UNISON, having to pay twice for the same person’s care.

I welcome the Minister’s comments in Grand Committee, where he provided some reassurances about safeguards to avoid such scenarios occurring; we debated these issues at some length at that stage. However, concerns still remain. It remains the case that there is no detail on this in the Bill and no firm mechanism to reassure those of us with concerns that it will be addressed within regulations. There is a real possibility that, if a patient exhausts their budget, they will either have to pay to top up their care, which I am told is wrong in any event under the Bill, or the NHS will be left to foot the bill. My concern is that, without the inclusion of any safeguards in the Bill, the risk remains that such scenarios could arise. This amendment would provide some security to those of us who are concerned that this significant change to the delivery of healthcare has yet to be fully scrutinised.

9.30 pm

Earl Howe: My Lords, Amendment 27 in my name follows on from the remarks made by the noble Lord, Lord Campbell-Savours. It indeed brings us back to the issue that we debated in Grand Committee, which is the need to guarantee that nobody is denied access to NHS treatment purely as a result of having a personal budget or being in a direct payment scheme. When he replied to me in Grand Committee, the noble

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Lord, Lord Darzi, assured me that the worry about someone running out of money and therefore not being able to access the care and treatment that he needed was not well founded. The situations that he described were ones where either there was inadequate resource allocation in the first instance for the defined care package or a personal health budget might turn out to be inappropriate. However, those situations are not the only ones that are relevant to the underlying concern.

The noble Lord referred to the safeguards outlined in the department’s guidance document, Personal Health Budgets: First Steps, but we know that this is not a definitive book of rules; it is, as he said, a framework within which the policy can develop further. The guidance states:

“Setting the budget at the right level will be one of the major challenges to be addressed during the pilot programme”.

I do not doubt that that is right, as we know the process for budget allocation is still under development. It goes on to say:

“Once at least an indicative budget is set, the next step is to draw up a detailed care plan designed to meet the individual’s agreed health and well-being outcomes”.

With all due respect, that seems to address the problem from the wrong starting point. Unless a detailed care plan is developed prior to resource allocation, how can one identify an appropriate budget?

My worry on this score is underlined by the Explanatory Notes, in the part that covers new Section 12B(5). This makes it clear that goods and services purchased by the patient directly should nevertheless be regarded as goods and services provided by the Secretary of State. It then says:

“This means that in prescribed circumstances, but only in prescribed circumstances, the Secretary of State could be considered to have fulfilled his duty to provide a service described at new section 12A(2) by making a direct payment”.

This caveat suggests that there may be circumstances in which a service user would not be able to access services through the NHS if their budget had proved insufficient. I should be grateful if the Minister could reassure me that this is not an interpretation that should be placed on those words.

It is perhaps not difficult to see why these issues are causing concern for organisations such as Diabetes UK, because, in that instance, diabetes is not a condition that would appear to lend itself readily to a direct payment scheme. The Minister will know about the Year of Care programme. Its aim is to define the differing needs of diabetic patients across the spectrum and then to pin down how much it would cost to deliver different packages of care that will enable each of those patients to manage their own care in an appropriate way. Evidence from the Year of Care pilots indicates that the task of calculating the allocation of personal budgets for people with diabetes will be difficult. A lot of work has to go into assessing and costing out different needs, but the key concern is unpredictability. Even if someone’s diabetes appears to be well managed and stable, there is always a chance that something will happen that throws everything out of kilter.



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Diabetes is complex and progressive. Having a personal budget or receiving a direct payment that is meant to cover the entire package for your diabetes runs the serious risk that the budget may run out, thus exposing you to having to put up with a level of care that simply does not meet your needs. It really is a case of saying that what should come first for diabetic patients—indeed, all patients of any kind—is making the right choice of treatment for an individual, based on that person’s clinical needs and preferences. The budget allocation should follow on from that.

That is why there is a fear—here, I return to Amendment 23—because patients need to understand exactly what they are letting themselves in for when opting for a personal budget or signing up to a direct payment scheme. Some conditions and some patients will be tailor-made for both, but others decidedly will not be. I shall not ask the House to vote on my amendment, but I should like the Minister to consider whether we need to beef up the Bill by building in an explicit statutory duty on the NHS to ensure that no one is denied treatment simply because they have opted for a personal budget or direct payment.

Lord Darzi of Denham: My Lords, Amendment 26, tabled by the noble Baronesses, Lady Barker and Lady Tonge, proposes that there should be a way for people to appeal against decisions on their direct payments. I agree with the sentiment behind this amendment that people should be able to complain and seek redress if there are problems with the services that they receive. Indeed, the NHS Constitution sets out the right to have any complaint about NHS services dealt with efficiently and investigated properly. However, I would be concerned by the idea of setting up an additional complaints or appeals system specifically for direct payments.

In the first instance, we hope that concerns can be resolved locally and informally. We would expect PCTs to discuss any concerns that people have, either about the size of the budget or the mechanism used to set it. We would encourage PCTs to be flexible to meet individual needs, while ensuring the fairness of the system as a whole. If a patient still has concerns, they are entitled to make a complaint, just as with any other NHS decision about which they are unhappy. NHS complaints procedures have recently been reformed to make the system more efficient and certainly more robust. Ultimately, patients may also ask the Health Service Ombudsman to look into their cases. Clause 10 extends the role of the ombudsman to cover services delivered through direct payments, precisely to ensure that people are suitably protected. It is worth reiterating that services paid for by direct payments are NHS services; patients are covered by the complaints procedure protecting patients receiving traditionally commissioned services. It is, therefore, unnecessary to create a new route of appeal or complaint, which might also prove costly and burdensome.

I turn now to Amendment 27, tabled by the noble Earl, Lord Howe, and Amendment 29, tabled by my noble friend Lord Campbell-Savours. These deal with the related situations of whether patients can receive other services alongside a direct payment and what

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happens if a direct payment budget has run out. I understand these concerns that people might be turned away from the NHS if they have exhausted their budget, or that the NHS should be forced to spend more money inappropriately. However, I assure noble Lords that this should not happen. As I have said before, and as we said in our Personal Health Budgets: First Steps, no one should ever be denied the care that they need. That is a core principle of our policy.

In addition, direct payments will often be for just one aspect of a patient’s care, or even one element of that patient pathway. Patients will still be able to use other traditionally commissioned services where that is appropriate. Direct payment should be used only when there is a likely benefit and it will be wholly voluntary.

In Committee, I emphasised that there were several safeguards in place to protect against the budgets running out. First, the personal health budget would be offered to people only in circumstances where their needs could be assessed and the budget calculated for them. Clarity on how we calculate such budgets is one of the requirements. Getting the calculation right will be important. We were pleased to see that a large number of the pilot applications that we received contained proposals for designing resource allocation systems. Many PCTs are aiming to build on the approaches already developed by local authorities. Others intend to develop their own mechanisms for assessing individual needs. There is a long way to go, but the pilots should produce valuable learning.

The second safeguard that we intend to have is a pre-agreed care plan for how the money would be spent. I take the point raised by the noble Earl, Lord Howe: the care plan must come first, before you calculate the budget. I could not agree more, although, in reading the Bill, I am not entirely sure whether there is an order that might be, in a way, adding confusion. The clinician, in partnership with the patient, must decide on the care plan and then calculate the budget.

Thirdly, there should be regular monitoring and review so that the budget can be adjusted in line with a significant change in the person’s conditions. Diabetes is a good example. It would be very unfortunate to see a diabetic patient progress in their illness into some of the morbidities of diabetes that we are ultimately trying to prevent. If the patient’s condition changed and they required an ophthalmologist to check their retinopathy or a renal physician to check their nephropathy, the budget should be adjusted to accommodate that. Alternatively, the patient may opt out and receive these extra treatments without a direct payment. I am confident that these safeguards will avoid problems arising for the recipient of direct payments or for the other patients and services.

I remind the House that these are pilots. The purpose of having pilots is to learn from them. We will certainly be empowered by the knowledge base from them. These are very innovative areas and I strongly believe that we need to be the leaders in innovations and in empowering patients through direct budgets. I hope that I have reassured noble Lords and that they will feel able not to press their amendments.



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Baroness Barker: My Lords, I thank the noble Lord, Lord Campbell-Savours, and the noble Earl, Lord Howe, for their support on this theme. It was immensely helpful that the noble Lord, Lord Darzi, made the statement that he did about clinical assessment having to come first and having to be a wholly separate process from financial assessment. It is a point that was the subject of extensive research by CSCI in the report that it produced earlier this year into individual budgets in social care. It wrote extensively about the need to have, first, an assessment of need as it is found in social care followed by a separate assessment of files. That is not a new issue. It has not arisen simply because of the existence of individual budgets; it has been a running issue throughout health and social care for some considerable time. However, given the way in which individual health budgets and direct payments are going to come in, I think that there is potential for great confusion.

I must admit that I am slightly disappointed with the noble Lord’s response to my amendment regarding appeals. I cannot help but think that, by their very nature, individual health budgets and direct payments will bring questions of cost and expense to the direct notice of patients in a way that has not happened before. By and large, with the exception of some areas such as NHS continuing care, discussions on financial transactions have not been conducted with patients, although they will be now. I hesitate to suggest that it may be na├»ve to think that this issue will not arise, but I think that not having an obvious system by which it can be addressed is another flaw.

I bow to the more extensive experience of the noble Lord, Lord Darzi, but I shall be astonished if the NHS complaints procedure is capable of handling the fallout from the introduction of individual budgets. Nevertheless, I note what he said and, in due course, we will see what happens. On that basis, I beg leave to withdraw the amendment.

Amendment 26 withdrawn.

Amendment 27 not moved.

9.45 pm

Amendment 28

Moved by Lord Campbell-Savours

28: Clause 9, page 7, line 23, at end insert—

“( ) as to the conditions that must be met to protect staff providing services which direct payments are used to secure”

Lord Campbell-Savours: My Lords, we know that the impact that the proposals for direct payments will have on staff is significant. In particular, the introduction of this more individual-centred delivery of healthcare will have a significant impact on workforce planning, especially where a patient embarks on a course of treatment that conflicts with professional opinion. Furthermore, if in the future direct payments create circumstances in which staff are employed directly by patients rather than by healthcare providers or the

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National Health Service, it is important that they are offered the same workforce protection and support to which other staff are entitled.

This amendment is a retabling of one from Committee stage. It calls for provision to be made in regulations to provide a level of protection for staff involved in providing services. UNISON has thousands of members working in the health service. Perhaps I may draw the House’s attention to the fact that it represents more than 450,000 healthcare workers and 300,000 social care workers employed in the National Health Service and local government and by private contractors, the voluntary sector and general practitioners. Many of those thousands of members working in the health service will be in the front line of implementing these proposals, and therefore clearly they will be affected in a major way by this legislation.

In Committee, the Minister recognised that the success of personal budgets and direct payments will depend on staff and that,

Given the extent of this culture change, surely there needs to be a level of protection in the Bill. We need something greater than a reassurance that, if staff engage during the pilot process, they will be properly protected and supported during such a period of change. We need regulation if staff are to be fully protected. I beg to move.

Lord Darzi of Denham: My Lords, this amendment aims to ensure sure that implementation of direct payments for healthcare is fair for staff. Clearly, there is no argument here in principle, but I am not convinced, as I said in Committee, of the need for setting this out in the Bill. Amendment 28, tabled by my noble friend Lord Campbell-Savours, deals with the issue of protecting staff who provide services funded by direct payment. As we discussed in Grand Committee and set out in Personal Health Budgets: First Steps, the successes of personal budgets and direct payments will depend on staff, those who support, agree and monitor care plans and budgets and those who deliver such services. This is a lesson that came across clearly from the evaluation of individual budgets in social care.

It is vital for all staff that they have terms of employment that are legal, reasonable and fair. All of those who directly employ staff will need to understand their responsibilities. Several PCTs have already been considering ideas to ensure that individuals and carers have the information and support they need to manage staff responsibly. We are keen to support that. While most staff would not argue with the aims of personalisation, its delivery will require a significant mindset shift. We have already touched on the cultural change, as pointed out by my noble friend. Staff should be involved and engaged as much as possible in steering the implementation of personal health budgets and direct payments and in developing appropriate training. In our assessment of the pilot proposals so far, we have therefore been looking for evidence that frontline staff and unions are directly engaged.

It is vital that the pilots help us to understand fully the implications for staff, including around their employment status, their conditions of work, and the

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skills they need. I have no doubt that my noble friend will agree that these pilots will provide us with wonderful learning opportunities that we can take back to our stakeholders, such as the trade unions, and work out a reasonable proposal for the future. I want to reassure noble Lords that our evaluation programme will specifically look at the implications for staff of personal health budgets, including those involving direct payments, and if there is a case for putting specific safeguards in place, the legislation already gives us the power to do so. Therefore, I do not believe at this stage that an explicit provision in the Bill is necessary.

I hope that the explanation I have given, including the fact that further safeguards could be set out in regulations, will provide enough reassurance that my noble friend will agree to withdraw the amendment.

Lord Campbell-Savours: My Lords, I am grateful to my noble friend for the recognition he has given to the role of staff in the National Health Service and I know that the unions appreciate the value of the dialogue that he has with them on matters of this nature. However, I am sure they will want to consider his comments further prior to Third Reading. On that basis, I beg leave to withdraw the amendment.

Amendment 28 withdrawn.

Amendment 29 not moved.

Amendment 30

Moved by Baroness Barker

30: Clause 9, page 7, line 23, at end insert—

“( ) as to the production every three years of an independent research report into the effects of direct payments on provision of health services and health outcomes”

Baroness Barker: My Lords, in moving Amendment 30, I want to turn again, in a slightly different way, to what was the theme of our discussion at Committee Stage and has been again today. This is the fact that individual payments and their potential effects on healthcare systems, on the level of healthcare services and healthcare outcomes are all great unknowns. I hope, as do other noble Lords, that they are a positive benefit, but there are a great many uncertainties about the principles and practice that will surround their introduction.

Much of the supposition made by the Department of Health is based on very limited evidence of pilots which have been run in social care. It is worth pointing out that the pilots for direct payments and individual budgets in social care happened at a time when health and social care funding was at an unprecedented level of growth. That is unlikely to be the case when these services are introduced within the NHS.

I also want to direct noble Lords’ attention back to the IBSEN research which we quoted extensively in Committee. It is one of the most tentative and circumspect research reports that I have ever seen. In Committee, I drew noble Lords’ attention to the cost and cost-effectiveness of individual budgets in social care. The cost and cost-effectiveness of services in social care is

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very largely determined by salary level and the availability of staff. Given the change in the economy, the availability of social care staff may increase. There has been a horrible shortage of them for several years. Salary levels may go down, which might mean that this becomes a much more cost-effective way of delivering services. For those and similar reasons, which could bear repetition although I do not wish to detain the House, it is reasonable to say that this policy, even on a pilot basis, is built on a whole series of assumptions for which, as yet, there is very little evidence.

My amendment is worded deliberately. It talks about,

It does not talk about the provision of those health services which will be funded by individual budgets. I return to a point that I have made several times before. Services for those with long-term and chronic conditions may be provided by the providers of acute services. By changing the funding patterns for part of what they do, one may potentially jeopardise the funding for the acute service. I make it clear that I am not talking about the impact on those conditions for which people are eligible to receive an individual budget; I am talking about the wider impact on health services and health outcomes.

Why should I propose that there be research every three years? First, I think that that is a long enough period in which to detect changes. Secondly, it is a sufficiently long period of time in which the effects of other relevant policy changes can be thrown up. It is also a similar timescale to that of a Comprehensive Spending Review. The position of health spending and the overall effects on the health service is a direct contributory factor to determining how people will have to use their individual budgets. Finally, a three-year timetable would take the process of research out of the political timescale as regards a change of Government. I believe that this is potentially one of the policies which will have the biggest impact on the provision of health services and health outcomes. It is therefore only right that it should be subject to regular independent review. I beg to move.

10 pm

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