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The last amendment in this group in my name is Amendment 287AA, which relates to indemnity. Currently foundation trusts carry vicarious liability for clinical care provided by their staff and therefore need to cover claims arising from this work. The trust can seek a source of indemnity from providers other than the NHS Litigation Authority but does not have to and does not have to publish whether or not it does.

The Medical Defence Union has already questioned the indemnity of any qualified provider with the Department of Health and had a response outlining that the NHS standard contract requires providers to have indemnity with a specific requirement set by local commissioners. The levels would vary according to the circumstances of different providers. But that response misses the point. I am not suggesting that the Bill should set the level of indemnity, but we should ensure that all providers of care to NHS patients have indemnity in place so that patients do not go uncompensated. The indemnity should be adequate and appropriate and this cannot be done under separate rules or regulations. The concern is that if a contractor goes out of business for whatever reason and does not have appropriate ongoing indemnity, there will be no course of redress for patients who have been harmed by that individual contractor.

There is a real prospect that patients who are severely or negligently damaged by an individual who does not carry adequate indemnity would then be completely unable to gain compensation because the way that the Bill is written does not require there to be adequate indemnity for the service provided. The long-term nature of clinical indemnity claims means that the level of indemnity must be adequate to provide compensation, sometimes many years into the future when a claim is settled or because sometimes the harm done does not emerge for some years. An indemnity, therefore, has to be in place when a provider is no longer in existence.

I will not elaborate any further on this because it is a discussion I would be interested in having with the Minister outside the Chamber and I am aware that we are time-restricted for this group of amendments, but I hope that the Minister will be able to consider the importance of indemnity for those providers that contracts are placed with and even for those they may sub-contract to.

House resumed.

2.22 pm

Sitting suspended.

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Police: Officer Numbers


2.30 pm

Asked By Lord Hunt of Kings Heath

The Minister of State, Home Office (Lord Henley): My Lords, police personnel data are collected on a financial year cycle. Published statistics show that there were 139,110 full-time equivalent police officers in England and Wales as at 31 March 2011. This compares with 143,734 as at March 2010.

Lord Hunt of Kings Heath: My Lords, I am grateful to the noble Lord. He will be aware that police authority grants for the next financial year show a £700 million cut in real terms, which is part of the 20 per cent cut front-loaded over a four-year period. How can the Government continue to claim that these cuts are not having an impact on front-line policing when the latest statistics show a worrying rise in crime? What does the noble Lord have to say about that?

Lord Henley: My Lords, first, I remind the noble Lord that we have a deficit and that must be tackled by seeking better value for money from every public service. That includes the police. There is no need for the noble Lord to make signs of that sort.

I accept that there has been a decline in police numbers, but there is no need to get fixated on this. At the same time, we have seen over the period that I mentioned-March 2010 to March 2011-a decline in recorded crime of 4 per cent.

Lord Mackenzie of Framwellgate: My Lords, will the Minister tell us the cost of appointing police and crime commissioners and how many front-line officers that would represent?

Lord Henley: My Lords, I have always accepted that there is a cost to appointing police and crime commissioners, but we believe they will bring accountability. Accountability will be good for that service, and we will get even better value for money.

Lord Howarth of Newport: Does the noble Lord think it is good value for money if the crime rate is going up?

Lord Henley: I have just quoted the figures relating to the period that I cited in the original Answer, which showed that recorded crime is going down.

Lord Hamilton of Epsom: What progress is my noble friend making with cutting down on the amount of bureaucracy that the police have to get involved in-form filling and so forth-rather than getting out on the streets and deterring crime?

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Lord Henley: I am very grateful to my noble friend for raising the question of bureaucracy. That is what my right honourable friend the Home Secretary has done in announcing a package of policies that will cut police red tape, saving some 3.3 million police hours per year. That is the equivalent of some 1,500 police posts.

Lord Jopling: My Lords, will the noble Lord answer yes to my question as to whether he will look at the pathetically low number of not only police officers but all emergency service workers who have been vaccinated against things such as smallpox and anthrax when the Olympic Games next year will clearly give us a dangerous situation so far as potential biological attacks are concerned?

Lord Henley: I hope I will be able to answer yes to my noble friend in due course. I will have to look at those figures, but I am unsighted on them at the moment. If my noble friend is prepared to accept it, I will write to him in due course.

Lord West of Spithead: My Lords, when I asked the noble Lord's predecessor but one about the retiring of more senior police officers and how this would have an adverse impact on people such as the terrorism support officers, I was told that a central register would be kept of how many were going, so that it did not have a disproportionate effect if they were taken from each police area. Where do we stand on that now? Has it had a disproportionate effect or are we managing to keep a balance across all the police areas?

Lord Henley: My Lords, again, I am somewhat embarrassed in that I cannot answer the noble Lord's precise question. I will certainly look at that, but I have not been made aware of any problems in that area. If I have not been made aware of them, I suspect that there is not a problem in that field. If I am wrong, of course I will let the noble Lord know.

Lord Laming: My Lords, the Minister will recognise that police forces across the country have been very successful in developing specialist child protection teams. In the current financial situation, some of these teams are extremely vulnerable. Can the noble Lord assure the House that he will use his good offices to protect these highly specialised and very important teams?

Lord Henley: The noble Lord is right to draw attention to the specialist work done by individual police forces. It is obviously a matter for each individual police force and the police authority to decide on the appropriate priorities. Certainly within the Home Office, we would want to encourage them to continue with that work.

Baroness Hamwee: My Lords, I apologise to the House for missing the start of the Question. I had forgotten that Prayers were earlier today.

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Police officers tend to retire at a relatively early age. For their own satisfaction, as well as thinking of the public purse, can the Minister say anything about continuing to make use of their expertise and experience, which is the product of both years and public investment?

Lord Henley: My Lords, obviously the training of an individual policeman is a very expensive process. We want to get maximum use of all policemen for as long as possible. Your Lordships will have noticed that some of the policemen who operate around this House tend to be at the older end of the spectrum. We are grateful for their expertise in providing protection for this House. Perhaps, as my noble friend Lord McNally implies from a sedentary position, they all look rather young to us. However, we do want to get as much use as possible out of all those policemen who have trained at such considerable public expense.

Lord Geddes: Can my noble friend advise how long the delay is in the present climate for an officer passing all the hurdles and being promoted to sergeant? How long does that person have to wait before he achieves that rank?

Lord Henley: My Lords, I am facing a lot of difficult and technical questions, which I have to say I cannot answer in the manner in which I would want. I am grateful to my noble friend for putting that question, but I will have to write to him with an answer.

Lord Dholakia: My Lords, there has been considerable effort made to recruit police officers from the black and ethnic minority communities. Can my noble friend indicate whether there has been any problem in retaining such officers and any reasons for that?

Lord Henley: My Lords, as my noble friend has made clear, considerable efforts have been made to increase the diversity of the police force. All police forces have made considerable gains there. I am not aware of any problems of retention, but if my noble friend has any evidence of that, I would be grateful to hear from him. That would then obviously be a matter that we would have to address.



2.36 pm

Asked By Baroness King of Bow

The Parliamentary Under-Secretary of State for Schools (Lord Hill of Oareford): My Lords, the Munro review and the Family Justice Review will help us to build the capacity of the social work profession and speed up the family justice system. The Government have appointed Martin Narey as ministerial adviser and established a ministerial advisory group. We have issued revised statutory guidance on adoption. To improve transparency,

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we have also published data on the performance of local authorities. We are committed to speeding up the adoption process, and will take further steps, as necessary, to do so.

Baroness King of Bow: I welcome the Government's efforts to improve the life chances of our most vulnerable children, but does the Minister share my concern that adoption of children with more complex needs-often older children, those who have suffered abuse or neglect-is often delayed because the Government will not provide funding for post-adoption services? Instead, we say to adopters, "You pick up the pieces. You look after a difficult child no one else will take and you pay for their specialist medical health requirements". Will the Government and the Minister review that funding policy so that we give our most vulnerable children the chance of a loving home?

Lord Hill of Oareford: I agree with the noble Baroness about the importance of trying to address the problem of how one finds places for older children. In particular, there are a number of groups-disabled children, sibling groups and older children-which, as the noble Baroness will know much better than me, suffer from those problems. I will certainly relay the points that she has made to my honourable friend Mr Loughton. I know that he is delighted that the noble Baroness has kindly agreed to serve on the ministerial advisory group. He is very grateful, and I am sure that he will pursue those points with her as part of that.

Baroness Benjamin: My Lords, at Barnardo's, of which I am vice-president, we have found that children who are adopted are more likely to have entered care because of abuse and neglect; 72 per cent of children who were adopted enter care for this reason. Because of the damage that they have endured, they need access to age-appropriate emotional and mental health services. Can my noble friend the Minister tell the House what steps the Government are taking to improve the capacity of the care system to support children and young people who have suffered neglect and abuse?

Lord Hill of Oareford: Again, I think that this is an important point. Across the piece, we are trying to take a number of different measures to address some of these issues, whether it is speeding up the adoption process, trying to raise the quality of the social work workforce or working with charities and other voluntary organisations such as Barnardo's. There are a number of ways in which we have to work. The Government have made a priority of tackling this problem and we will continue to come forward with proposals as to how we might best achieve that.

Lord Turnberg: My Lords, a two-and-a-half-year average delay in the adoption of a child at this very vulnerable age is devastating for that child and may have disastrous consequences. Although some delay may be necessary in order to make a proper assessment of the suitability of adoptive parents, can anything be done to reduce the rather long delays in the judicial processes? Can we also do something about removing

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the unhelpful barriers to white parents adopting black children? There is a rather large number of black children who are hanging around waiting and we should not be putting up barriers.

Lord Hill of Oareford: The noble Lord is absolutely right that black children have particular problems in finding adoptive parents and that the results for them, in terms of finding adoptive parents, are far worse. Their chances are half as good as they are for other children, and that is clearly a problem. We have sought to make it clear that the colour of someone's skin should not be a bar to them adopting. If one can find parents where all sorts of things all fit into place that might be better for the child, but the most important thing is a loving parent. In terms of delays in the court process, the Family Justice Review looked at that and has come up with recommendations that we should aim to spend no more than six months on the court side of the process. That would address the problem that the noble Lord has rightly identified.

Lord Elystan-Morgan: My Lords, desirable though it is that a Government should prudently plan and estimate the number of appropriate adoptions in England and Wales in a year, and appropriate though it be that every effort should be made to ensure that there is an available stock of would-be adopters, does the Minister nevertheless agree that adoption is an order of the court of such crucial importance that it should only be made in the light of the specific facts of that particular case, bearing in mind the interests of the child and taking into account the whole of its life?

Lord Hill of Oareford: The noble Lord is exactly right: one wants to adopt a balanced approach to adoption. The fact is that the number of children being adopted has unfortunately been falling. Of around 3,000 children in care under the age of one last year, only 60 were placed in adoption. There are things that we ought to do to redress the balance, but the noble Lord's underlying point is clearly important.

Baroness Hughes of Stretford: My Lords, the Government's proposals will remove legal aid entirely from some 35,000 families a year who are in court for one reason or another concerning their children. Are the Government not concerned that without legal representation there will be severe delays in the hearing of these care cases, including children for whom the plan is adoption, adding further to the delay for these children?

Lord Hill of Oareford: My Lords, CAFCASS has an extremely important role to play in giving support through the legal process to the families and the children who are going through this process, and that support through CAFCASS remains in place.

Baroness O'Loan: My Lords, does the Minister have any information about the consequences in terms of the number of children adopted following the closure of children's adoption agencies consequential to the sexual orientation regulations?

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Lord Hill of Oareford: My Lords, I am aware of the number of Catholic adoption agencies that have had to reorganise to carry on performing their important role. I would be the first to recognise that the Catholic adoption agencies, in particular where disabled children are concerned, have a very proud and long record. However, very few of them have had to reconstitute themselves to comply with those regulations-I believe it is actually only one. I know that there were concerns about that, and I am glad to say that the vast majority have managed to accommodate the regulations and to carry on with the important services that they provide.

Health: Cancer


2.45 pm

Asked By Baroness Royall of Blaisdon

Baroness Northover: My Lords, this study concerns mortality. We have a good track record on reducing cancer mortality. However, because mortality rates are linked to incidence rates, mortality on its own is not a useful measurement of NHS performance. Survival rates are much more effective as they show how good the NHS is at diagnosing and treating people with cancer. We know that our cancer survival rates lag behind the best performing countries, and our ambition is to improve survival rates and save 5,000 additional lives per year by 2014-15.

Baroness Royall of Blaisdon: My Lords, I recognise what the noble Baroness says about survival rates, but does she agree that the report demonstrates that in the past 10 years cancer services in the UK have improved dramatically? While England and Wales spend less on health than most other countries-9.3 per cent of GDP compared with 10.7 per cent in Germany and 15 per cent in the USA-they achieved the biggest overall annual fall in cancer deaths, and cancer deaths are important to people in this country as well as cancer survival rates.

Baroness Northover: The noble Baroness is right; there has been that decline. Of course mortality is extremely important, but you have to look at incidence, survival and mortality together. She will also be aware that much of that decrease in mortality is because of the decrease in men smoking. Men took up smoking in larger numbers than did women. The numbers of men smoking started to decline in the 1950s, and that has had an effect on the decline in the number of cancer deaths.

Lord Aberdare: My Lords, pancreatic cancer is one of the deadliest cancers, accounting for about 5 per cent of all cancer deaths. A recent report by Pancreatic Cancer UK found that survival rates for pancreatic

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cancer patients in the UK-only 3 per cent are expected to live for five years or more-are worse than in most comparable countries and have not improved in 40 years. What assurances can the Minister give that the NHS will continue to work to improve results in all forms of cancer and that pancreatic cancer sufferers will not just be written off as a lost cause?

Baroness Northover: Pancreatic cancer is an extremely difficult cancer to diagnose. As the noble Lord knows, when it is picked up it is often very advanced and survival rates are very poor indeed. The Government are well aware of the problems here. My honourable friend Paul Burstow in the other place is meeting Pancreatic Cancer UK shortly. I hope that the noble Lord will feed into that. If he has an association with that organisation, can he put his questions to it so that they can be fed to Paul Burstow, or alternatively to me?

Baroness Gardner of Parkes: My Lords, is it not a fact that the great improvement in cancer treatment is due to early detection? It is important to keep people trained in that, particularly for the rare cancers that I am always talking about. Do the Government not feel that we owe a great deal to the cancer and research charities that are continuing to do very useful work in alerting people to the need for early detection?

Baroness Northover: My noble friend is absolutely right. We owe a huge amount to the organisations in the United Kingdom, not least Cancer Research UK, which is a major player internationally. She is also right about early diagnosis. That is how you start to bring deaths down; you make sure that you diagnose early enough so that you can intervene in a way that is going to be much more effective. Noble Lords might like to know that there will be a first ever national cancer campaign on bowel cancer to flag up the symptoms to people in the hope that they seek diagnosis at a much earlier stage, because if it is caught early it is completely curable.

Lord Winston: My Lords, the complex paper by Professor Pritchard also looks at the costs of delivering cancer care. One of the points made very clearly in that paper is that the cost of drugs delivered under the NHS is considerably less. We pay far less for the excellent results that we get than Germany, Spain, Italy and France do-as much as 40 per cent less, in some cases. Given that, and given that independent assessments of the health service show that the British health service has some of the best value for money in the world, why did the Prime Minister say that we cannot go on as we are and introduce the current Health and Social Care Bill?

Baroness Northover: I fully agree that the National Health Service is very cost-effective and that it has been an extraordinary service. However, we have many challenges coming down the track, as the noble Lord will be acutely aware-not least our ageing population, which needs to be supported, particularly at home and in the community where appropriate, and not immediately

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taken into hospitals, where interventionist care may not be in the best interests of those patients. Therefore it is extremely important that there is more clinical judgment on the best interests of each patient and how these things are organised, and that they are not simply driven forward by the way in which provision is organised at the moment, which is very much focused on secondary institutions.

Lord Sharkey: My Lords, the biggest cause of cancer deaths in the country is still lung cancer. It kills more people every year than breast cancer and prostate cancer combined, yet lung cancer attracts only 5 per cent of cancer research funding. The Minister has said that this is unsatisfactory and thinks that it is largely due to the lack of first-class research proposals. Does the Minister agree with me that we should not let this situation continue, with the biggest killer getting the least research? Will the Minister consider urgently sponsoring a meeting of all interested parties to see how we might intervene to generate many more fundable first-class cancer research proposals?

Baroness Northover: My noble friend raised this with my other noble friend Lord Howe, who has taken a slight break in the health Bill at the moment. I was struck by his answer, which was on the paucity of cancer research funding for lung cancer. I therefore have more information for my noble friend, which is that the amount spent on lung cancer between 2006 and 2010 in fact doubled in comparison with a 28 per cent increase for overall cancer research spending. The National Institute for Health Research, for example, is currently hosting 62 studies on lung cancer that are being set up or are just beginning to recruit patients. I hope, therefore, that my noble friend will be encouraged that there appears to be a shift. However, if my noble friend would like to write to my other noble friend the Minister with detail about the meeting that he would like, the Minister would be delighted to receive that letter.

Loan Companies: Interest Rates


2.53 pm

Asked By Lord Mitchell

The Parliamentary Under-Secretary of State, Department for Business, Innovation and Skills (Baroness Wilcox): My Lords, there are real concerns about these loans, but capping interest rates is not necessarily the solution as it could reduce access to licensed credit and force some consumers into the arms of illegal loan sharks. We have commissioned research to look at the impact of capping the total cost of credit that these lenders can charge. We are having discussions with the industry on ensuring that existing codes of practice contain real enhanced consumer protections to address concerns that blight this market.

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Lord Mitchell: I thank the Minister for that reply. Some 3.5 million people in this country use payday loans. Yesterday I decided to become one of them. I applied for a loan for £300 over a 21-day period. I went on a very friendly website and filled out all the forms very quickly. It told me that if I clicked the button, I would have £300 in my bank account in 15 minutes. I had to repay, in three weeks, the sum of £369, which is an annualised interest rate of 4,200 per cent. I did not click the website. Will the Minister say whether the Government plan to regulate this industry? There are a lot of very desperate, vulnerable and gullible people out there, and I think that they need help.

Baroness Wilcox: I thank the noble Lord for his personal intervention on this question. No doubt consumers should not be swayed by promises that they will have the money in their banks in minutes. This may well be true, but before taking out one of these loans they should stop and think. Most people handle payday loans very well-we are rather good at handling credit in this country-but at the moment we are going through tough times and more people are borrowing fast, quickly and just for a couple of days. Of course, we all know that APR is annualised up and therefore most people pay about £50 or £60 for the couple of days that they need the money. Without doubt, there are concerns around payday loans such as rolling over old loans into new, businesses using continuous-payment authority to take money out of people's bank accounts when they are not expecting it and a real lack of transparency about how these loans work, as the noble Lord has just shown. We have started discussions with the industry on ensuring that its existing codes are working and being enforced, and we are now looking at the total cost of credit. Bristol University's Personal Finance Research Centre is to carry out research to identify the impact on consumers and businesses of introducing a cap on the total cost of credit, as referred to by the noble Lord.

Baroness Oppenheim-Barnes: My Lords, does my noble friend agree that the most important part about any new code is that it makes it absolutely clear to the borrower from the start how much the loan is going to cost and what other consequences might arise from late payment?

Baroness Wilcox: My noble friend was not only the Minister for Consumer Affairs but the chairman of the National Consumer Council for some years, so if she speaks on this subject we know that she speaks with authority. She is absolutely right; to be an informed consumer is the most important gift that we can give to people when they make purchases or take out a loan. We have started discussions with the industry to check that people are giving out the right information, and in April next year we will move free advice to the Money Advice Service, which will be co-ordinating debt advice across the country.

Baroness O'Loan: My Lords, in light of the reductions in welfare benefits coming down the road, are there any plans to address the critical period of debt and

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introduce effective regulations that will require advertisements in the windows of these money shops to say exactly what a loan will cost? For example, if you borrow £100 for a month it will cost you £X. That sort of information would immediately alert people to the risks that they are running. We cannot afford to wait for commissions of inquiry and academic research about something that, as the noble Baroness has said, is a long-standing problem.

Baroness Wilcox: The Office of Fair Trading is always vigilant and always has its eyes on this to make sure that the information is out there. That is a particularly good piece of advice, however. I will see whether this is being done and, if not, what we can do to take it forward.

Baroness Royall of Blaisdon: My Lords, I agree with the noble Baroness when she says that we need informed consumers, but will she agree that for a Government to say that people should stop and think before they take these loans demonstrates that someone is out of touch? These people are desperate and poor and they have nowhere else to go, which is why they need good regulation and assistance.

Baroness Wilcox: After six years as chairman of the National Consumer Council and seven years as the president of the Trading Standards Institute, I am sorry if I gave the impression that I take it casually that people should get into trouble in this way. I apologise if that is the impression that I gave. There is no doubt that the biggest worry in all this is that capping, or any other similar action that we take, will lead to the poorest and most vulnerable people having to go to illegal moneylenders, where the punishment if they do not pay is not always visible. All the time that they can borrow money legally-no matter how high the interest, no matter how wrong the way in which they are borrowing it is-we can at least be there to help them out of the trouble they get into.

Devolution (Time) Bill [HL]

Bill Main Page

Third Reading

3 pm

Bill passed and sent to the Commons.

Health and Social Care Bill

Committee (12th Day) (Continued)

3 pm

Clause 58 : Monitor

Debate on Amendment 260EB resumed.

Baroness Murphy: My Lords-

Baroness Anelay of St Johns: My Lords, I appreciate that this procedure is not common, but it is not novel. The noble Baroness, Lady Murphy, is seeking to contribute to the continued debate. May I suggest that Peers who

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are attempting to leave should do so by the other door, and preferably not by that door-I say to the noble Lord, Lord Borrie-so that she can stand and be heard by the House?

Baroness Murphy: Thank you very much indeed. I just want to comment briefly on the amendments on licensing. Some of them are asking quite a lot of the licensing procedure, but there may be other mechanisms that achieve what they want to achieve. I am sympathetic to people's desire to add these conditions, but I think that it is important to see the licensing arrangements as part of the system, in conjunction with registration with the CQC. It enables Monitor to approve the compliance arrangements to achieve good governance and the information requirements needed to monitor that the organisations are delivering the right standard of care.

The threat of licence revocation enables Monitor to pick up at an early stage the problems of quality and finance which other people have spoken about. Obviously the providers will be very concerned to hold on to their licence, which seems to be a very powerful and potent tying-in of organisations to the ethos and objectives of the NHS. We must be very careful not to regard the licensing process as something within which to impose too many conditions, but as a basic framework that ties the licensees into the system. That is particularly important when organisations start to go wrong. We will discuss later how they are rescued from those predicaments. However, it seems to me that this creates a basic level playing field, and that it would be a mistake to use that process to do much more than tie everyone into the basic system. It sort of replaces the old authorisation process on compliance and quality that was operated by old Monitor, but it is a way of going forward as new organisations come into the NHS as providers of NHS services. I just wanted to add those comments because I think that these amendments might be adding a bit too much to the responsibilities of the licensee.

The Parliamentary Under-Secretary of State, Department of Health (Earl Howe): My Lords, licence conditions will be the mechanism through which Monitor will be able to prevent potentially anti-competitive behaviour and enable service integration, where this is what commissioners want. Monitor would also use licence conditions to collect the information it would need to set prices, and to help identify at an early stage-at an early stage-if a provider was at risk of financial distress. If that was the case, it could work with the provider to address potential problems, as well as supporting commissioners to ensure continuity of services. I completely understand the concerns in that area.

First, I think that I need to make clear that all providers of NHS healthcare services will be subject to the requirement to hold a licence. This includes providers of primary medical services, which is the question posed in Amendment 279A. Furthermore, where a provider is providing services that carry a requirement to be registered with the Care Quality Commission, that registration will be a prerequisite to being granted a licence by Monitor. We all want to see

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close operational links between Monitor and the CQC. The Bill emphasises this by placing duties of co-operation on both organisations, not just in matters such as information sharing, but also in the development of the joint application mechanism for providers seeking registration from both bodies.

We are also clear that regulation must be proportionate, and impose the minimum of additional burdens on those being regulated, while still safeguarding the interests of patients and the public. To that end, the Bill makes provision for the Secretary of State to make regulations establishing an exemptions regime, so that licensing can be targeted towards those parts of the health service where there is the greatest need for regulation. While we are clear that there must be an exemptions regime, we also recognise the importance of making sure that we get the scope of it right. To that end, we are already committed to consulting fully next year on our proposals for the exemptions regulations. Noble Lords may also be aware that the Delegated Powers and Regulatory Reform Committee of your Lordships' House has recommended that the first set of exemption regulations should be subject to the affirmative resolution procedure. We agree, and both Houses will have the opportunity to debate them before they come into force.

The Bill provides for Monitor to attach conditions to licences. While the Bill sets a framework for the scope of those conditions in Clauses 95 to 97, we are clear that it will be for Monitor itself to develop the detail as the sector regulator. The intention is that the conditions will support Monitor in exercising its functions and that Monitor will be best placed to know how they should be framed to achieve that. Therefore, including large numbers of mandatory conditions on the face of the Bill, as some noble Lords have suggested in certain amendments-for example, Amendments 283, 285ZA and 287A-would undermine the Monitor's independence, which we do not think is desirable if it is to be a robust and vigorous sector regulator.

Nevertheless, I would like to reassure the Committee that there will be proper oversight of Monitor's proposals for conditions. My right honourable friend the Secretary of State will have the power to veto the first set of licence conditions. We are clear that Monitor must be able to operate freely and autonomously within the legislative framework established by the Bill. We have built in reasonable checks and balances through requirements for key products, such as the licensing criteria and conditions, to be subject to approval by the Secretary of State. Although I understand entirely the reasoning behind amendments tabled by noble Lords which would increase the level of the Secretary of State's involvement in provider regulation-for example, Amendments 281A, 282A and 282B-regrettably, I feel that these go a step too far in limiting Monitor's independence.

The noble Baroness, Lady Thornton, asked me quite a number of questions to which I feel I should write in response. In particular, however, she asked whether Monitor will have the role of resolving disputes and whether all disputes would go to court. The answer to both of those questions is no. The NHS standard contract already provides for contractual disputes to be resolved through arbitration and this will not change. Licence holders have to agree special

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conditions or modifications to conditions. If the provider disagrees and Monitor then wants to proceed, it must refer the matter to the Competition Commission for consideration.

My noble friend Lord Clement-Jones spoke to Amendment 281A. I want just to comment briefly on that. The amendment would increase the minimum length of notice period during which representations could be made following publication of a notice of proposed exemptions. I am grateful to my noble friend for that. The Bill is clear that the notice period should be not less than 28 days. It could therefore be much more than that, and our expectation in most cases is that it will be. But there will be times when the Secretary of State needs to act quickly, so being locked into a notice period of not less than 90 days could be detrimental to a particular provider or group of providers.

My noble friend Lady Williams spoke to two amendments, Amendments 287EA and 287EB, where the purpose is to ensure that licence conditions on providers of NHS services restrict the income they can earn from private patients and the number of private patients they treat, as well as that funds provided for NHS care are not used to subsidise private treatment offered by foundation trusts, with various conditions attached. I understand my noble friend's concern about this. However, the amendments would be impractical, and in particular for licence holders who are not NHS bodies they would be highly undesirable. Foundation trusts' principal purpose-we will come to this in a later group of amendments, when we discuss the private patient income cap-is to provide goods and services for the NHS in England. It means that they must earn most of their income, over 50 per cent, from NHS services. We are tabling a government amendment to make it clear that the majority of every foundation trust's income will continue to be from NHS service provision. Foundation trusts must comply with their principal purpose or they will be breaking the law. They could be at risk of successful legal challenge if they fail to meet their principal purpose. We are tabling a second government amendment to require foundation trusts to show in their annual reports how income earned from private activities has impacted on the provision of NHS services. Using NHS income to subsidise private patient work would lead to foundation trusts breaching the NHS constitution. The Government also gave a commitment that foundation trusts will have to produce separate accounts for their NHS and private-funded work.

Finally, I want to mention briefly the amendments that will fall to me to move in relation to licensing: Amendments 280A, 281B, 284A to 284C, 285A, 286B, 287C and 287D, and 288A to 288F. These are without exception minor tidying-up amendments to improve the drafting or clarify meaning, and I hope that the Committee will accept them when they are moved. I hope, too, that the Committee feels reassured by my explanation of how we envisage licensing to operate and that the noble Baroness will be able to withdraw her amendment.

Baroness Finlay of Llandaff: My Lords, can the Minister provide clarification on the questions I asked? First, who is going to define what is expected of

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primary care services in terms of how they are integrated? If that does not form part of their licensing, who will define the minimum standard across the country? Secondly, in Amendment 282ZC I set out that:

"A criterion for a person or organisation to be granted a licence must be that that person or organisation demonstrates a commitment to education, training and research".

I would be grateful if the Minister could explain the situation when someone may well be good enough to provide clinical services but shows absolutely no commitment to any aspect of education and training, even for the development of their own staff, or to any of the research developments that might be happening in their field. I would include in this physiotherapy and occupational therapy assistance, such as people putting appliances into homes and those providing supportive care-assistance services in health, but not the secondary and tertiary-care specialised services which are covered very adequately by all the criteria from the royal colleges. It is about the minimum standard.

My third question relates to indemnity: do the Government feel that it is acceptable for a provider to be licensed without having to demonstrate that it has adequate indemnity?

3.15 pm

Earl Howe: My Lords, I apologise to the noble Baroness if I skirted over the considerable number of questions she asked, and if it would be helpful to her I will write her a letter on all of them. Perhaps I may cover two at this point. As regards her Amendment 282ZC, our expectation is that Monitor's licensing criteria will be light-touch and broadly drawn, to encompass a wide range of providers. The amendment she has tabled does not lend itself to that approach. Much as I understand the importance of this particular issue, requiring any and every licence applicant to meet a definition of,

that Monitor has developed does not fit with the principles of proportionate and targeted regulation. But I will write to her with further reasoning on that.

As regards the noble Baroness's Amendment 282ZB, which is about indemnity, if she will forgive me, again I think that I will have to write to her.

Lord Clement-Jones: I have another amendment on which the Minister might find a lacuna-Amendment 287A, which deals with the Nolan principles.

Earl Howe: Will my noble friend allow me to write to him on that?

Lord Clement-Jones: I assumed that he would make that undertaking.

Baroness Thornton: I am glad that the noble Lord, Lord Clement-Jones, asked that, because I was waiting to hear what the answer would be. I look forward to the noble Earl's response. I fear that the noble Earl will be spending the whole of the weekend writing letters to all of us about these matters.

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I am not going to say very much about this. This has been a divided debate, but many of the questions asked have been similar. The noble Baroness, Lady Williams, was quite right to raise the issue of requirements. She and her noble friend Lord Clement-Jones were right to raise the issue of transparency, which is very important here.

I am not sure that we on these Benches would agree that the checks and balances are the right ones. At this stage, we will wait for the letters from the noble Earl. I will also read his remarks again in Hansard. We may return to discuss this matter again. I beg leave to withdraw the amendment.

Amendment 260EB withdrawn.

Clause 58 agreed.

Schedule 8 : Monitor

Amendment 260EC

Moved by Baroness Thornton

260EC: Schedule 8, page 361, line 15, at end insert-

"( ) The chair and the chief executive must be separate roles, and cannot be held by the same person."

Baroness Thornton: We turn now to the very important matter of Monitor and accountability. I see that many noble Lords have amendments in this group, many of them echoing each other. The reason for that is that, given the powerful role that Monitor is to have-whether it will have this role under the regime proposed by the Minister or the alternative architecture proposed by myself earlier today-we think that accountability is very important indeed.

We propose two improvements to Monitor's governance. We believe that its functions should be exercised in the public interest and therefore that it should meet in public, as the NHS Commissioning Board will. We should also no longer have a combined chair and chief executive post. I hardly need say to the House that this arrangement is totally against established good practice in the public or private sector. I rest that issue there and look forward to the noble Earl's response.

When foundation trusts were set up, the idea was that they could earn freedoms from traditional NHS management and also bring an element of democratic accountability and community ownership. It must be said that much of this has not materialised. Some foundation trusts up north have made an effort to engage locally with the people they serve. Some have adopted a business model rather than a community ownership model. I am sure that all noble Lords are members of their foundation trusts-I hope that they are and that they take part when asked to do so. The target to push up membership numbers in the trusts seems to have been forgotten.

Being successful in becoming a foundation trust shows that a fairly high barrier was overcome but that represents only the position at one point in time. As with the share market, things can go up or down. Some big-name foundation trusts have had their bad patches. A few, surprising names have been at the edge of intervention. If you compare the list of foundation

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trusts flagged as being in difficulty by Monitor with the list of ratings from Dr Foster or, in its time, the ratings from the Healthcare Commission, there seems to be no pattern at all. Indeed, a double-excellent foundation trust came close to de-authorisation.

Every large, complex organisation can get into trouble. Past success is no guarantee of future performance nor is it necessarily even a good predictor. That is why we argue that the oversight of foundation trusts by Monitor should continue and its intervention powers should remain. We have long argued for shifting the balance of power and we fully support the idea of earned autonomy with the regulator as an independent judge. But if it is earned it can also be taken back. We shall see what transpires when one foundation trust is obviously unable to present a viable business plan. What will happen to its future?

Monitor has to continue in the role we gave it as the authoriser of foundation trusts as they earn their limited independence. In recent times, it toned down the role it took as the promoter of foundation trusts and as a trade body as a step too far. We argue that Monitor as a regulator should be neutral not a cheerleader. We can accept the principle that it is wrong to favour any type of organisation for arbitrary or political reasons, as is set out in the operating framework. We do not accept the convoluted and ultimately meaningless formulation contained in the Bill. Monitor should retain its intervention powers. We accept the case for autonomy and community ownership but in the final analysis we see foundation trusts as still part of the NHS and so, in the end, subject to the powers of the Secretary of State.

We accept that the governors should be a strong element in foundation trust governance but, as the Bill accepts, they need support and development in that role. Most foundation trusts will say that governor effectiveness takes at least five years but governors, no matter how effective under normal circumstances, may be completely ineffective in times of overwhelming crisis. It is then that the Secretary of State must have the power to intervene to ensure the overall functioning of the NHS and to protect the interests of patients and their communities. A major change here is that the Bill extends the concept of financial regulation to non-foundation trust providers-that is, the private sector. As I have said before, we can see the logic in that.

I am going to skip ahead and do what I said earlier in the Bill: you do every other page of your brief and see whether anybody notices. We have already had a lot of debates about these issues.

Finally, we come to reservations about the interaction between the licensing regime and the use of standard contracts. Actually, we have also discussed that so I will not ask those questions again. We have recently seen missives from the Department of Health and from Monitor exploring the ideas around regulation. It is slightly amazing that these are all coming out now, as helpful as they may be. The general idea, as we have said before about the Bill, is that you should consult on the legislation, allow Parliament its scrutiny role and then implement it. However, as we know, the Bill exhibits the principle of reverse engineering. When

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its progress was paused to allow consultation, the Government continued to roll out the implementation and the Bill is catching up with that now. We scrutinise the Bill alongside its implementation and the secondary legislation is written up in the form of documents coming out of the Department of Health.

I turn to our amendments in this group. Amendment 260EC provides that the chair and chief executive of Monitor cannot be the same person, Amendment 260GA provides that Monitor must meet in public and Amendment 267D would apply the mandate to Monitor. We think that Amendment 267D might be improved on and might even be better located in Clause 20 on the mandate itself, but the point of it is to raise the idea that the Secretary of State may be given a greater power of direction of Monitor and ultimately boost its accountability. I beg to move.

Lord Clement-Jones: My Lords, I would like to continue the train of thought started by the noble Baroness, Lady Thornton, about the specifics relating to Monitor. I shall speak to Amendments 260F, 260G, 260H, 269A, 294BA, 294BB and 294BC.

First, I may not have got Amendments 260F and 260G, relating to the first chief executive of Monitor, completely right, because Monitor is already in existence, but in principle the chief executive of Monitor should surely be appointed by the Secretary of State in the same way in which the chairman and chief executive of the national Commissioning Board are. As we go through this debate, it will become increasingly obvious that Monitor's role is as important as that of the NHS Commissioning Board, so I would have thought that having an appointments system on all fours with the board would be imperative. Then again, we come to the question of the provision of information to the Secretary of State. Amendment 260H mirrors the powers possessed by the Secretary of State in relation to the NHS Commissioning Board. It seems sensible that that should be in place as well.

Harking back to our debate on competition and the application of EU competition law, we come on to a rather different issue. This is an interesting place for these amendments to be put. In Clause 118 it is the Competition Commission that deals with the determination of methods of setting prices under the national tariff if there is a disagreement-the Competition Commission has that referred to it by Monitor. For all the reasons that we explored in the debate on the first set of amendments today, it is inappropriate, in my view and in the view of many others, for the Competition Commission to be so heavily involved in matters relating to the NHS. Substituting the Secretary of State for the commission seems to be sensible.

The objection is sometimes raised that we need an independent body in order to set the method. That is a fair point but it is an objection to the Secretary of State doing this entirely on his own, whereas an independent panel appointed by the Secretary of State could do the job equally well. That would ensure that there was some arm's-length relationship with the Secretary of State in these circumstances. It is quite unnecessary for the Competition Commission to do what is going to be an extremely unfamiliar job for it

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in assessing the methodology of setting the national tariff-far better that others who will become familiar with it should undertake that task as advisers, consultants or whatever to the Secretary of State. All these amendments make good sense.

3.30 pm

I move finally to Amendment 269A. The regulations under Clause 61 are very important. The noble Baroness, Lady Thornton, referred to them in her first speech today. Understandably there is considerable debate and discussion about whether it is desirable for Monitor to exercise functions in relation to adult social care. However, we are not being asked at this stage to make a decision about it. If we were being asked to decide whether Monitor should exercise those functions, it is important that we have the debate in this House, indeed in both Houses. That is why this amendment sets out that it should be decided by the affirmative procedure, which would be an entirely proper way of dealing with it and would be on the Floor of this House. In all these cases they seem to be tightening-up provisions that recognise the importance of certain regulations and of Monitor and that the role of the Competition Commission throughout this Bill is inappropriate.

Lord Warner: I thought there was going to be an intervention from my left. I was not going to intervene in the debate on this group. I am sorry if I missed something by missing the debate on the first group of amendments. I have some concerns about the dual role of Monitor as the arbiter of foundation trust status and the raft of new duties that it will undertake as an economic regulator. Let me make it clear that I have no problem whatever with the role of Monitor as the economic regulator and the functions that go with that. However, I want to share with the Minister and the House some of the previous Government's thinking on whether Monitor could combine being the economic regulator and the arbiter on the passage to foundation trust status. The situation, if anything, is more difficult now. We finally concluded that we could not make Monitor the economic regulator until we were much, much further along the path of completing the job of trusts becoming foundation trusts because there were potential conflicts of interests, which we will come to later.

I raise this issue at this point because there are accountability issues here as well. I can see the very strong arguments-and I have every sympathy with the Government on this-for setting up an economic regulator and the Secretary of State not dipping in and out of those functions. If you are going to have a regulator, let it be independent and leave it to get on with the job. I am very comfortable with that. My concern is that we are already going to be loading a very large number of functions on to this economic regulator, and to expect it to carry on, even with Chinese walls, as the arbiter on foundation trust status is a big ask, given that most of the promising candidates for foundation trust status have already jumped over the bar and we are getting down to the ones that have been finding it rather difficult to jump over the bar.

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That could be because the Government have set themselves the target of 2016. We set ourselves targets of 2008 and 2012, and quite a lot of trusts have still got nowhere near jumping over the bar, so I certainly would not bet the farm on them all having cleared the hurdles by 2016.

Monitor, in its role as the arbiter on foundation trusts, needs to keep a very close eye on those that have cleared the bar and to intervene when it needs to. The Secretary of State is actually embroiled in that process. The cases have to be cleared by the Department of Health and the Secretary of State before they go on to Monitor. That is a long-established process. The Secretary of State is going to become involved to some extent if trusts lose their foundation trust status; they go back into the pool in a sense.

We are now dealing with a situation that is much more difficult financially and much more challenging than it was under the previous Government. We are trying to get Monitor to do an even more difficult job with the most difficult trusts in an extremely difficult climate and to take on the job of being an economic regulator. There are real issues about whether that can be done and about separating out the areas where the Secretary of State has a legitimate role. It is legitimate for the Secretary of State to have a presence in the build-up to a foundation trust application and when a trust loses that status. However, that set of issues is separate from the accountability issue when Monitor performs the role of an economic regulator. Will the Minister share with us some thinking about how those separate functions will be handled in the real world that we will face over the next three to five years?

Baroness Williams of Crosby: My Lords, I wish to address my Amendments 274AA, 274C, 274D and 274E in this group. I shall speak as briefly as I can. I share many of the concerns expressed by the noble Lord, Lord Warner, on whether we are overloading Monitor with too many requirements to make judgments, to intervene and to be responsible to enable any single body to function, however brilliantly led it might be.

This amendment is about the conflict of goals on the part of Monitor. I believe that it is a very important amendment, although it looks modest enough. The Bill states that if Monitor has a conflict of objectives-or, more clearly, a conflict of duties-that will in essence be resolved by the head of Monitor making a statement about the nature of that conflict and the ways in which it could be resolved and then turning it back to the perpetrators to solve the problem as best they can. Those conflicts are substantial. We should make it clear that they are fundamental to the whole argument that we have been having, including in the brilliant previous debate because, first and foremost, the general and primary objective of Monitor is supposed to be the promotion of patient health and patient care. That is fundamental. We heard in the very eloquent speech of the noble Baroness, Lady Meacher, how she thinks Monitor has changed its philosophy of life within the NHS and has become much more concerned with patient care and patient protection than with the pursuit of competition primarily for its own sake. That is a very important step forward in our understanding of the Bill.

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However, it still leaves open the possibility of a conflict arising between the duties of Monitor. I have just mentioned the first of those duties-the care and concern about patients who are dependent on the health service. The second duty continues to be a concern with anti-competitive policy, and the third is concerned with integration and collaboration, about which there has been a great deal of discussion and many amendments in this House. The Bill gives us very little guidance on any conflict over which of those duties should be given priority over the others. It says that a conflict of duties or a conflict between responsibilities is to be resolved in this rather heavy-handed way of a statement being made about the nature of the conflict and how it might be resolved, which is then distributed to all those concerned. However, there is no resolution of the conflict. It remains part of what one might describe as an ongoing negotiation that some day might resolve itself in one direction or another. It has interesting parallels with yesterday's events. However, Amendment 274E sets out very clearly that we believe that ultimately conflict should be resolved by the Secretary of State. We accept all the intervening proposals in the Bill at present-that statements should be made, that the conflict should be defined, and that it should then be passed on to those involved to try to find a solution. If, at the end of the day, no solution is found, it is absolutely crucial, in our view, that this becomes the responsibility of the Secretary of State as the ultimate goal of any accountability or responsibility within the service itself.

In this House I think we have got much closer to recognising how significant this final duty over a range of issues is. The Secretary of State is open to accountability to Parliament and to the general public, the people of England, so we say in Amendment 274E that if no solution can be found, there should ultimately be a reference back to the Secretary of State, who then has to make this ultimate decision. We have deliberately framed it to say that he is the ultimate decider, not one of those deciders on the way, although Monitor certainly has a role in resolving the conflict.

Since the future health service will in part be defined by what is seen to be the most significant of those duties, I think the Minister and most of us in this House believe that that central duty has to be responsibility to the patient and to the care and protection of the patient. I urge us to give this very serious consideration, because it is part of the pyramid that was set out in the brilliant speeches in an earlier debate by the noble Baroness, Lady Thornton, by my noble friend Lord Clement-Jones, and by my noble friend Lord Newton of Braintree, who has now had to leave us. I therefore propose the amendment in that spirit. It puts into a microcosm the concept of where the most responsible and urgent duties on Monitor lie.

Earl Howe: My Lords, I think that this has been a very useful debate. The Bill provides a more autonomous NHS, and it does so in order to deliver high-quality services and value for money. Monitor, as sector regulator, would establish clear standards and rules to protect patients' interests in the provision of NHS services. Monitor would be required to lay its annual report and accounts before Parliament and have the accounts

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audited by the Comptroller and Auditor-General. It would also need to comply with other rules and guidance that cover central government public bodies, including the seven general principles of public life, the Treasury's guidance document, Managing Public Money, and rules on corporate governance. Monitor would also have to respond in writing to parliamentary committees and any advice from HealthWatch England. The Secretary of State would oversee Monitor's performance of its functions to ensure that those functions were performed well. The Secretary of State would not have control over Monitor's day-to-day decisions, but would hold Monitor to account for discharging its duties. That point is extremely relevant in the context of a number of amendments in this group. The Secretary of State would appoint the chair of Monitor and other non-executive directors and would have to give consent to the appointment of the chief executive. I hope that point answers Amendments 260F and 260G.

Baroness Thornton: We are yet again in the territory of Monitor setting its own rules and implementing them, and of the Secretary of State's role. The Minister has just said that the Secretary of State will, as it were, monitor Monitor. Can he please describe to us how exactly he will do that?

3.45 pm

Earl Howe: My Lords, I will come on to that in a moment. The Secretary of State would also have specific powers of veto; for example, over the first set of licence conditions and, in individual cases, of provider unsustainability, where he considered that Monitor was failing in its functions to support commissioners in securing continuity of services. In addition, he would be able to request information from Monitor regarding the exercise of its functions as and when he considered it necessary. I hope that this therefore allays the concerns of noble Lords who put their names to Amendment 260H.

However, Monitor needs to be free from day-to-day political and other inappropriate interference in order for it to be able to act in the best interests of patients. In order to maintain the integrity of its relationship with the Secretary of State, Monitor must be able to take independent decisions on the exercise of its functions, such as calculating prices, setting and enforcing licence conditions and resolving conflicts of interests. Making such decisions subject to approval would be inconsistent with this approach, and would conflate responsibilities. In particular, it would undermine the Secretary of State's ability to hold Monitor to account. There would also be significant risk of decisions being politicised inappropriately. By contrast, independence in such decisions would increase transparency and help ensure that providers were treated fairly.

I understand the motives of noble Lords who added their names to Amendments 274AA, 274C, 274D and 247E, relating to the Secretary of State's involvement in resolving conflicts of interest. The Government agree that where they occur, conflicts must be resolved, but giving the Secretary of State a role in decision-making would undermine his ability to hold Monitor to account. The Secretary of State would be obliged to keep under

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review Monitor's performance in discharging its duties. He would be able to direct Monitor, where it had failed or was at risk of failing significantly, to carry out its functions. In extremis, he could arrange for a third party to perform those functions or perform functions himself. I hope that those points answer the question of the noble Baroness, Lady Thornton.

The Bill also ensures transparency and fairness, through requirements on Monitor to consult widely when discharging functions and appeal mechanisms for the major decisions it makes. Here, I am addressing Amendments 294BA, 294BB, 294BC. In this way, our proposals strike a balance between maintaining sufficient independence and ensuring that the Secretary of State has sufficient ability to hold Monitor to account for the performance of its functions. I believe there is consensus that we need to ensure that this balance is correct.

My noble friend Lord Clement-Jones asked why it should be the Competition Commission that decides on challenges to Monitor's proposals on licence modifications, pricing methodologies or whatever. I am grateful to him for that question. It is fundamental to our proposals that Monitor would be an independent regulator and that the appropriate role for the Secretary of State is to oversee Monitor's performance against its duties, and to intervene where he considered that Monitor was significantly failing in any of its functions. However, it is vital that the legislation provides appropriate checks and balances on Monitor without undermining its day-to-day independence from political control. That is why we proposed that Monitor must consult on the licence conditions that it proposes to impose on providers and on its draft methodology for pricing. Providers and, in the case of pricing, providers and commissioners should be able to object to Monitor's proposals, and where a sufficient percentage objected, there should be a mechanism for independent and impartial adjudication. That is the role we propose for the Competition Commission. It would act as adjudicator on disputed licence modifications and on disputes over the pricing methodology. The basis for this adjudication would be Monitor's overarching duty to protect and promote patients' interests.

Baroness Thornton: Did the Government consider any bodies other than the Competition Commission as being appropriate to fulfil this role? If so, which were they and why were they not thought to be appropriate? This is a rather heavy-duty form of monitoring Monitor.

Baroness Williams of Crosby: I am puzzled by why the Government do not see the Competition Commission's overseeing of this area of Monitor's responsibilities as not being neutral. Would not a body such as the Office of Fair Trading be more appropriate? It has a reputation not only of being more neutral but of having shown in the past particular sensitivity and understanding of health as a service provided to the people of England.

Earl Howe: I think it is a question of specialist expertise. I do not regard it as heavy-handed to have the Competition Commission acting in this role-which,

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we hope, would not be a role that it would need to perform with any regularity. It is an established body. It would apply a public interest test rather than a competition test, which is important. One has to question whether the Office of Fair Trading is the right body. I will of course reflect on my noble friend's suggestion, but we believe that the Competition Commission is a good fit in this sense. If the Secretary of State were to play the role of adjudicator, that would be very detrimental. The result would effectively be the politicisation of Monitor's decisions. As I said earlier, that in itself would undermine the Secretary of State's role in holding Monitor to account for the outcomes that it achieves.

The noble Lord, Lord Warner, referred to conflicts in the role of Monitor in overseeing foundation trusts. We are quite open about the fact that there is a risk of conflict of interest here. That is why it is essential that the Bill sets out a robust way for conflicts to be resolved. In a later debate, we can discuss that at greater length. I listened with interest to the speech of my noble friend Lady Williams, and I will of course reflect further on everything she said, as I always do. I think I have covered the main issues raised by the amendments in this group.

Baroness Thornton: I think that almost the first sentence I uttered in this debate was: will Monitor meet in public; and what do the Government intend to do about joint chairmanship and chief executiveship? If the Minister answered those questions, I did not hear him and I apologise.

Earl Howe: The answer is yes.

Lord Clement-Jones: The Minister said that he thought that the amendments tabled by my noble friend Lady Williams-Amendment 274AB, et cetera-would undermine the role of the Secretary of State and his ability to call Monitor to account. That seems a very far-fetched way to describe an attitude to conflict-resolution. The Secretary of State, particularly under Amendment 274E, is asked to resolve conflict. This is an addition. There is no other way, as far as I can see, of resolving conflict. A key issue, which has also been raised by the noble Lord, Lord Warner, in this debate, has been the multiplicity of roles of Monitor. Therefore, there is a strong need to resolve such conflicts.

I ask the Minister to consider further whether that is really detracting from the Secretary of State's ability to monitor Monitor-in the words of the noble Baroness. We need a mechanism to resolve conflict. Faute de mieux, this seems to be the best one.

Earl Howe: My Lords, I hear what my noble friend says, but the fact is that the amendments he refers to would reduce Monitor's independence from political interference. We are clear that we do not want political interference in Monitor's activities. The intent of the amendment is clearly to give the Secretary of State increased accountability for the decisions around Monitor's functions. We believe that Monitor will be an effective regulator and able to deal with conflicts of interest. Clause 63 requires Monitor to resolve conflicts

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between its functions. If a failure to resolve conflicts between functions was significant, then the Secretary of State already has the power to intervene under Clause 67. Therefore, there is an intervention mechanism but we suggest that it should be triggered only in the circumstances to which I have referred.

Lord Walton of Detchant: Will the Minister say whether, if Monitor is to meet in public, it will have reserve powers to allow it to go in camera if for any reason it may be required to consider highly sensitive personal information, which ought to preserve confidentiality in respect to the individuals concerned? It is crucial that such a power should be available to it.

Earl Howe: The answer is yes, although we do not expect that Monitor would ever have occasion to see named patient records.

Baroness Thornton: My Lords, I think this has been an extremely useful debate. I can see why this Government may not trust their Secretary of State to hold Monitor to account. However, I am concerned about the idea that because we-and I do not just mean Members on this side of the House-are anxious that accountability rests in the right place in the Bill, that must therefore translate into political influence or micromanaging. I do not think that is at all the case here. Therefore, we do have an issue still to explore regarding the accountability of Monitor.

I also think we need to explore whether the Competition Commission is the right place for a public interest test to rest. The noble Baroness, Lady Williams, may have made a useful suggestion about which other bodies could possibly undertake that function. Again, we find that this quango is determining its own rules and then implementing them. That is not a satisfactory situation. However, I did take hope from the fact the Minister said yes to the question of whether the chair and chief executive of Monitor would not continue to be the same person, and that Monitor should meet in public. Is the Minister accepting Amendments 260EC and 260GA, or is that the statement of principle with a government amendment coming forward at a later stage or, indeed, a letter from the Minister, clarifying the issue? Otherwise, I beg leave to withdraw the amendment.

Earl Howe: I was accepting that particular principle, but I will follow it up in writing.

Amendment 260EC withdrawn.

Amendments 260F to 260H not moved.

Schedule 8 agreed.

Clause 59 : General duties

Amendment 261 not moved.

Amendments 261A and 261B had been withdrawn from the Marshalled List.

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Amendments 262 to 264 not moved.

Amendment 264A had been withdrawn from the Marshalled List.

Amendments 265 to 265A not moved.

Amendment 265B had been withdrawn from the Marshalled List.

Amendment 265C not moved.

4 pm

Amendment 266

Moved by Lord Warner

266: Clause 59, page 87, line 21, at end insert "and in discharging this duty will conduct and publish within one year of Royal Assent a review of the anti-competitive barriers that restrict NHS patients from benefiting from new or existing organisations providing new or extended NHS services that defined quality standards, together with their proposals for removing these barriers"

Lord Warner: My Lords, this amendment is in my name and that of the noble Lord, Lord Patel. I begin by briefly making clear my position on competition, which underpins this amendment. I am sorry that I had to miss the discussion on the first group of amendments. However, my position on competition is no different from what it was when I was the NHS reform Minister in the Blair Government, but it is somewhat different from that of the current Front Bench, as will become clear.

I start from a position of being opposed to monopolies, whether they are in the public or private sectors, and I consider that such research evidence as is available-such as that by Dr Zack Cooper at the LSE-supports the view that competition-

Baroness Murphy: I apologise. I think that the group we should be addressing begins with an amendment in my name. Unfortunately, I withdrew that amendment last week but it has continued to appear in the Marshalled List, for which I apologise. I believe that we should be moving on to the next amendment in that group.

The Deputy Chairman of Committees (Viscount Ullswater): Perhaps I may clarify matters for the Committee. The group that we are now discussing begins with Amendment 265ZA, tabled by the noble Baroness, Lady Finlay, but which she did not move. However, the amendments in the group following that one were called in their place.

Lord Clement-Jones: My Lords, we seem to have skipped a whole group, but for what purpose? I was planning to move Amendment 267ZF. Has there been some discussion between the usual channels?

The Deputy Chairman of Committees: We are on the group beginning with Amendment 265ZA, which was not moved. The next two amendments in the

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group were also not moved. I then called Amendment 266, tabled by the noble Lord, Lord Warner, which he is now addressing.

Lord Clement-Jones: My Lords, I think that that is inadvertent. We seem to have missed a whole group of amendments.

Baroness Thornton: Perhaps I may help. I think that the thing to do is to deal with this group of amendments and the noble Lord can then move his amendment. We will then take the group of amendments that we should have been taking out of turn. Am I right in that? I think that that is the best thing to do.

Lord Clement-Jones: I am grateful to the noble Baroness.

Lord Warner: Is the Committee happy for me to continue? I consider that research evidence as is available, such as that carried out by Dr Zack Cooper at the LSE, shows the benefits of competition and supports the view that competition, when used sensibly, improves services for patients and can indeed save lives. It is perfectly possible to support both competition and integration; they are not mutually incompatible. I shall not pursue the evidence base for my views today. However, I should like to clarify briefly the circumstances in which we should be supporting the use of competition in the NHS in the best interests of patients and why it is important to tackle barriers to entry to the NHS market. It is important to recognise that we already have an NHS market in which many NHS providers do indeed compete for patients against other NHS providers. The Bill does not suddenly inject competition into the NHS but merely tries to impose some better rules and a system for regulating that competition.

There are basically three sets of circumstances in which competition could-not should-be used. The first is that, as a matter of principle, all NHS providers should be subject to market testing periodically. The second is when there is clear provider failure and it seems sensible to test the market to establish the best set of arrangements for replacing the failed incumbent. The third is where there is a set of circumstances when the NHS itself-the commissioners in practice-wish to change significantly the way in which services are provided and it is not apparent that the current incumbents can adjust quickly to the patient's needs. The first set of circumstances has often caused a great deal of angst in the discussion of competition. I certainly do not start from that position. I believe that it is the second and third areas that I have described where we need to examine whether there are real barriers to entry by new providers, irrespective of whether those providers come from elsewhere in the NHS-from the private sector, social enterprise or the voluntary organisations.

Amendment 266 is concerned to establish much more clearly than now what the barriers to NHS market entry are. We know from the work of the collaboration and competition panel that primary care trusts have behaved in anti-competitive ways and have frustrated the best interests of patients. We know from the experience of the East Surrey nurses when they

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tried to set up a social enterprise how frustrated they were at changing themselves from NHS employees into a social enterprise so that they could compete for NHS business. We know that across the voluntary sector, voluntary organisations have been frustrated over their attempts to compete for NHS services over a long period of time. We also know that many private providers of services find the tendering processes for providing NHS services prolonged and excessively expensive and that they are too often frustrated by shifting political opinions about the desirability of competition.

I could go on with examples of the way in which the NHS has effectively shut the door to new entrants. Some of the most recent examples are the ways in which many primary care trusts divested themselves of their provider services without any proper system of market testing when it was clear that many of those services were extremely inefficient. We need to take the NHS out of its comfort zone in a future where it faces a huge set of demographic and financial challenges. Keeping it in the NHS family is no longer acceptable or in the public interest. We need an independent, authoritative and robust analysis of the barriers to entry to the NHS market so that we can consider what action should be taken to remove those barriers. Amendment 266 proposes that Monitor does this within a year of Royal Assent. I believe that Monitor would welcome being given this assignment but I would be more than willing to consider alternatives if the Government thought, for example, that the Office of Fair Trading was a more appropriate organisation to do the job. It is important that we get this job done as speedily as possible. I also support Amendments 278 and 287 to which the noble Lord, Lord Patel, will be speaking and to which I have added my name.

Baroness Williams of Crosby: My Lords, I am very grateful that Amendment 265C has somehow managed to escape from the tsunami of amendments so that I can bring it to the Committee's attention very briefly. It is again an amendment that seeks to make sure that when competition is allowed or encouraged-the noble Lord, Lord Warner, has spoken on these lines himself-it should be because it clearly improves the quality of health and the quality of provision within society as a whole. The purpose of Amendment 265C is to make it clear that competition is welcome when it improves the quality of the service; it narrows inequalities; it ensures, in particular, that there should be a better outcome as a result of that competition; and it is, therefore, a relatively qualifying condition to permitting competition to flourish.

We have heard a number of very well informed speeches in the House, not least from the noble Baroness, Lady Meacher, to the effect that in some situations competition can clearly encourage innovation, can improve new approaches and can help in providing the NHS a way forward to deal with the huge problems that we all recognise exist. However, in large part we are also very worried about the idea of competition as the ruling principle of the health services in this country, and we heard a very moving set of evidence from the noble Lord, Lord Owen, and the noble Baroness, Lady Thornton, about the devastation that unrestrained competition can exercise on a health service.

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However, having spent 10 years of my life in the United States, I absolutely corroborate that. I know far too many people, one or two of whom are National Health Service refugees to this country, of outstanding talent, who are not in a category where they can afford the huge prices that are charged for complex and chronic conditions in the United States. How do we achieve this difficult balance so as to have competition that improves the quality of the health service but does not bring about the devastation of a great many human beings because they simply cannot afford the cost of complex operations or looking after the chronically ill? The situation of the chronically ill in the United States is pathetic in very many cases.

Therefore, this amendment and several others in this group would enable us to walk this delicate line in a way that permits competition, but competition that is in the interests of the patients of the health service and not competition that could devastate the health service itself.

Lord Clement-Jones: My Lords, I wish to speak to Amendment 287B. In his speech at the outset of today's debate, the Minister said that there were four areas where he was considering amendments to Part 3, which deals with Monitor. If memory serves, he said there were areas where the Bill had not been completely amended to conform to the Future Forum report. This is a particular example of that.

Clause 96, the supplementary conditions, says it is possible for Monitor to include conditions that require,

Of course, that mirrors the duties of Monitor as set out in Clause 59, which says:

"Monitor must exercise its functions with a view to preventing anti-competitive behaviour"-

so far, so good. However, Monitor also has a duty to,

improve quality and so on. There is no mirror of that particular duty in the supplementary conditions in Clause 96, which is why this amendment adds the following wording:

A number of other examples are the subjects of amendments as well and will no doubt come up in the course of the Bill. It seems to me that the equal and opposite to the anti-competitive duty of Monitor, which is enshrined in the ability to set conditions and so on, is not mirrored in the integration of services, and this is an extremely good example of that. I very much hope that the Minister will be able to indicate that it is simply an oversight and it should be included in the Bill.

4.15 pm

Baroness Murphy: My Lords, I wanted to come in on this matter of anti-competitive practices and the role of Monitor in it. I apologise to the Committee if

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some of these matters have already been covered, but I was unable to be here this morning. However, this seems like an opportunity to speak, as we are discussing Monitor's role in anti-competitive practice.

I am concerned that we have not yet talked about the quite serious anti-competitive practice that exists in the NHS today, and how damaging it is. As we know, the independent co-operation and competition panel has highlighted a range of tactics that are very common at the moment in the NHS and which go seriously against patients' interests. We have not sufficiently considered these when we are looking at competition. We tend to think of competition in relation to the independent sector versus the NHS in approaching the provision of services, but in fact it is this anti-competitive practice within the NHS which is so damaging. An example of this is the protection of certain local services against providers for elective operations, and so on.

I can think of an example in my own backyard, at Barts and The London-and this is a very real case. For years and years Barts used the mainstream orthopaedic services to provide local podiatry services, at a very high cost and very anti-competitively against the local community services, which had very skilled podiatrists who were able to do foot operations very cheaply and simply with a much smaller waiting list. Those sorts of anti-competitive practices are rife throughout the NHS, and are against patients' best interests. It is utterly crucial that this role to reduce as much anti-competitive practice as possible should be watched by Monitor, but we want it to be co-ordinated with its role on integration-there is absolutely no reason why the two things cannot go side by side.

I am sure that we will come on to mergers and acquisitions, but the recent protection of patients and the public-for example, against the merger of two mental health trusts, Norfolk and Waveney, and Suffolk-seems to me to be extremely good judgment about what is likely to be in patients' best interests. We should remember these matters of anti-competitive practice that are, as I say, rife in the NHS, and we really need to do quite a lot to stamp them out. I hope that the role of Monitor in working on these practices in patients' best interests will be strongly supported.

Baroness Finlay of Llandaff: My Lords, the noble Lord, Lord Warner, was most helpful in setting out the criteria with which one would want to look at competition, and emphasising the importance of competition. But there is another area of competition, which is the one that really drives up quality of care: the inherent competitiveness of different clinicians and different clinical services, their desire to have better clinical outcomes than others, and the pressure that they will put on themselves within their own team to achieve better clinical outcomes.

I apologise to the House if I contributed in any way to the confusion over the numbering of the amendments as they have arisen. I would like to address the ones that come after Amendment 266, which will be Amendments 268B and 267C. Amendment 267C was tabled because of the large number of patients with complex clinical conditions.

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It is very easy, when we are thinking about tariffs and services, to look almost at discrete nuggets of care, diagnosis and so on. Indeed, Monitor has a requirement in the Bill to seek appropriate advice to effectively discharge its functions in,

The amendment related to the management of a wide range of complex conditions has been tabled because in complex conditions many situations overlap and cannot be discretely targeted together, nor can they necessarily be unpacked one from another because of their impact on each other. That requires integration of clinical services.

Baroness Northover: The noble Baroness might be aware that Amendment 267C has leapfrogged from the group with Amendment 264 to the group after this. She may wish to address that amendment when we come to that group.

Baroness Finlay of Llandaff: I thank the noble Baroness. I am most grateful. That message had not reached me, although I may be a little deaf. I shall simply confine my remarks to the amendment in this group about Monitor reporting annually to the Secretary of State on how it discharges its duty to promote integration. I do not think that the comments that I made previously are annulled. They are relevant because, unless we have integrated services-however much they may be seen to be in competition with each other over different aspects-and attempt to have a seamless provision of care, at the end of the day it will be the patients who fall through the gaps.

Earlier today, we heard a lot about Monitor being light touch, not having a series of minimum criteria and being able to use its discretion in how it grants licences of all sorts. But I have a concern that there has to be a means by which the way in which Monitor functions is transparent and available to public scrutiny. That is why I have suggested that an annual report to the Secretary of State would allow such scrutiny to occur, particularly as regards promoting integration.

Lord Beecham: My Lords, in the first instance, I shall speak to Amendments 267ZDA and 269 in the names of my noble friend Lady Thornton and myself. Amendment 267ZDA refers to the need for integration. Indeed, there are a series of amendments on integration, with which I will try to deal as a group. Amendment 267ZDA gives an interpretation of integration which would,

which I suppose is the very definition of integration-and which offers patients,

Surely that aspiration would be shared by the Committee and widely within both the health and social care professions. It would seem to make sense to incorporate

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it in the Bill. However, Amendment 269 simply makes clear that it is unnecessary for a provision in the Bill to repeat a definition of anti-competitive behaviour since that already exists in existing legislation, although that is not a hugely important point.

In relation to other amendments in terms of integration, we certainly support Amendment 268B, which would provide the duty for Monitor to report annually as to how it has promoted integration. Amendment 274B seeks a requirement to publish a statement if conflicts between its functions arise which are likely to have a significant impact on integration of services. Amendments 278 and 278B impose requirements on the national Commissioning Board and clinical commissioning groups to extend the right of patients to make choices in respect of the integration of healthcare and to ensure the integration of services where that is in the public interest. Again, the aim is to drive the integration agenda. Then, as an overarching provision, Monitor would have under Amendment 278C the power to investigate whether the Commissioning Board and clinical commissioning groups are complying with those requirements. All of these seem to be perfectly sensible amendments to provide the right structure and one which Monitor could effectively supervise.

Still on the integration agenda, there are later amendments-Amendments 286A, 287 and 287B-which impact on integration. Amendment 286A allows a modification of Monitor's powers to encourage integration, if that is in the interest of patients, as it usually will be, presumably. The amendments provide for modifications to licence conditions-again in the interest of integrated healthcare-to ensure that standing conditions of licences include requirements relating to or encouraging the integration of healthcare services. All that makes a sensible package to drive an important part of the underlying concept of the Bill and the too-long-deferred integration of services.

The other amendments in this group essentially relate to the issues of collaboration or competition. Here, it is slightly unfortunate that the noble Baroness, Lady Finlay-I am sorry, the noble Baroness, Lady Hollins-did not move Amendment 265ZA, which stresses that Monitor must exercise its functions with a view to promoting collaboration and preventing competitive behaviour. I think that is the other side of the coin that the noble Baroness, Lady Murphy, put on the table previously when she was complaining, perhaps rightly, about anti-competitive practices within the NHS. A more positive way of looking at that agenda is to say that NHS bodies should collaborate on the provision of services, rather than take a negative stance. That is, I suppose, a necessary fallback position, but the prime objective must be to ensure collaboration within and across health service provision and-having regard to what has just been indicated in relation to integration-with social services as well. That is probably the right approach.

Other amendments in this group relating to competition raise some other issues. For example, under Amendment 265C, there is a suggestion that Monitor's duty to prevent anti-competitive behaviour should be qualified by requiring it to aim to improve the quality of services and outcomes and the efficacy of provision and reduce

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inequalities. These are listed separately; I take it that all of them-rather than any alternative-are intended to be part of Monitor's duty. If the Minister were minded to accept the thrust of that argument, he would do so in that sense.

Again, there is the provision under Amendment 266, tabled by my noble friend Lord Warner, for Monitor to conduct and publish a review of anti-competitive barriers and their impacts within a year of Royal Assent. There may well be some sense in that, particularly in regard to the way in which he moved the amendment. There are similar duties on Monitor to look at impact assessments under Amendment 275. Government Amendment 278D, to be moved by the Minister later, refers to non-disclosure of the "business interests" of parties. Does that extend to the interests of, say, trusts or voluntary sector providers? Does "business" relate to their activities or would it be confined to commercial providers? It seems to me that it would be invidious if only one part of the provider sector had the protection of confidentiality; it should be applicable to all or none. There is of course no issue with the amendment that requires individual circumstances not to be subject to disclosure.

I have a question about Amendment 278J, which requires the Competition Commission to review the "occurrence" rather than the "development" of competition in the provision of healthcare services. It is not clear to me what the significance of the word "occurrence" is. This is not a government amendment and I do not know whether those who originally tabled it want to clarify the position. I understand the amendment if it requires the Competition Commission to review the impact of competition in the provision of healthcare services, but I do not know how the occurrence of competition would be reviewed. It does not actually make much sense to use the word in this context.

The thrust of most of these amendments makes sense and sets out a sensible role for Monitor. In what would have been the next group but for the leapfrogging, we will come on to look at the issue of conflicts, and I am sure that there will be some further discussion about that. However, I hope that the Minister will feel able broadly to support the amendments in this group and recognise that they should contribute to meeting the shared objectives that have emerged from today's debate.

4.30 pm

Lord Whitty: My Lords, I apologise for not being here at the beginning of the consideration of this group because for once the Committee is making faster progress than I thought, but I have tabled two amendments that relate back to the issue of anti-competitive behaviour, so I will be following on from my remarks about the first of the amendments today. I seek greater clarity from the Minister. Given that Monitor has responsibility for preventing anti-competitive behaviour-in other words, not just the encouragement of competition but also the policing of it-what happens when someone complains to Monitor? In effect, Monitor has been given the same powers as the OFT and other economic regulators in other sectors and, as my noble

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friend Lord Beecham has just said, is subject to some oversight by the Competition Commission, which has duties in this respect.

Let me give two examples of what in other sectors would be seen as anti-competitive behaviour. One is where two providers in an area get together to divvy up what they know the commissioning body wants and provide a package that is acceptable to the commissioning group. A third provider would like to get in on the action. It is probably qualified, so that is not a hurdle. If that provider then complains to Monitor, is Monitor able to say, "This may appear to be a bit anti-competitive, but actually it is in the interests of patients"? I assume, from all the Minister has said and from what is set out in the document about the role of Monitor, that it means it can say that. But is that the end of the story? Can there be an appeal against Monitor to the courts or, if it is systematic, to the Competition Commission review role?

There is also the opposite scenario: competition laws relate to monopsony and oligopsony as well as to monopoly and oligopoly, so if a number of commissioning groups get together and decide that they will buy collectively from particular providing groups but not from others, is that also grounds for appeal to Monitor? If Monitor nevertheless decides that that is in the interests of patients, is there a further recourse? I was worried earlier today that there might be further recourse and that, despite all the assurances that have been given, Monitor is not actually the final regulator on what is in the patients' interests, because it is supposed to act in accordance with or reflect the general rules, including EU rules, on competition and procurement.

This situation is going to arise because, with the Government's encouragement, there will be more providers than those which get commissioned. A failed or disappointed provider must know how the system is supposed to work so that Monitor can look at it and be judged on it. With other economic regulators there is a form of appeal in this respect, to the Competition Commission. It is not used very frequently, but when we are trying to bed in a new system it may well be used more frequently by disappointed and failed competitors. If that is not to happen, it has to be clear in this Bill-and if not in this Bill then by ministerial decree and in regulations-that once Monitor decides something is in the interest of patients that is the end of the story. Otherwise, I cannot see the system working without constant appeals and second guessing.

Lord Walton of Detchant: My Lords, I shall be brief in speaking to these amendments. I wholly agree with the principle outlined by the noble Lord, Lord Warner. There are many circumstances in which competition, properly controlled, will benefit the National Health Service and will benefit our community. But, like the noble Baroness, Lady Williams, I too, having worked in the United States, would be deeply concerned if competition were allowed to run riot. Years ago, I saw the affect of this. For instance, in the Massachusetts General Hospital, where I worked many years ago, the president of the hospital told me that they were required to debate and negotiate with no fewer than 47 different insurance companies in order to obtain coverage for the patients whom they treated.

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Yet in the United States you still find, in certain communities, perfectly acceptable patterns of community care which are in many ways excellent, not least the Kaiser Permanente plan in California. I also visited an excellent clinic and associated hospital providing a substantial range of primary, secondary and tertiary care to a very wide community in Marshfield, Wisconsin. The Marshfield clinic serves a very large community in that state. All the people in the community pay an annual subscription in return for which they get a full range of primary, secondary and tertiary care of a very high standard. There are islands of excellence.

So far as competition in this country is concerned, I have always believed that the cap imposed upon foundation trusts in relation to private patients was unfair. It was imposed at a particular moment in time and based upon income derived by those individual trusts in a preceding period, and was grossly uneven. I have always favoured a partnership between the public and private sectors. In such hospitals and foundation trusts I believe there is a great advantage to allowing them to have more income from private patient beds: it not only generates income for the National Health Service, it also persuades many consultants to become geographically whole-time, looking after their public and private patients in the same hospital and not having to spend time, as many have in the past, travelling to private hospitals.

I believe in competition and in the public-private mix. But in pursuing that type of programme, it is absolutely crucial that Monitor has the authority to prevent any foundation trust from overstepping the mark and increasing its private provision to the extent that it will harm the services that it gives to NHS patients. I would love to have an assurance from the Minister that Monitor will be able to fulfil the function of controlling excesses which could damage the National Health Service if private provision went too far.

Lord Patel: My Lords, briefly, we are getting a bit confused between the amendment of the noble Lord, Lord Warner, which I support and is about anti-competitive behaviour, and people talking against competition. The amendment is quite clear. It asks Monitor, within a year, to identify barriers to quality care that are anti-competitive. The noble Baroness, Lady Murphy, gave one example and there are others, such as optometry services, which can, if given the opportunity to expand, not only provide good diagnostic services but also treat some minor ailments that do not need referral to hospital. Our amendment is about anti-competitive behaviour. It is not about competition.

Earl Howe: My Lords, there are some extremely helpful amendments in this group. Indeed, there has been a great deal of valuable debate both inside and outside the Chamber on the roles of competition and integration in the health service. I am grateful for much of what the noble Lord, Lord Warner, said in his introductory speech.

The Government have been clear that both competition and integration can be important tools for commissioners to drive up the quality of services for patients. We have

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also been clear that it will be for commissioners to decide where and how these tools should be used-not Monitor. There will be no "one size fits all" or a model prescribed by government.

To help ensure that both competition and integration are effective, Part 3 of the Bill seeks to establish appropriate powers for Monitor. Where there is competition, Monitor will have powers to ensure that it operates effectively in the interests of patients and to safeguard against anti-competitive conduct that can work against those interests. The Future Forum concluded that Monitor, as a sector-specific regulator with knowledge and expertise in health services, would be best placed to achieve this. Let me remind the Committee that this is if there is competition. In some circumstances, I freely concede that commissioners may decide that the best way to achieve high-quality services for patients is not to have competition.

On Amendment 265C, I hope that noble Lords will agree that it is the right approach to require Monitor's focus to be on considering the interests of patients. That will allow Monitor the scope to take account of a broad range of factors. This approach also provides continuity with the requirements of the existing system rules, the Principles and Rules for Co-operation and Competition, which we have committed to retaining and giving a firmer statutory underpinning through Monitor's sectoral powers. Those powers are the setting and enforcement of licence conditions for providers and the overseeing of commissioning regulations set by the Secretary of State. Along with the concurrent powers to apply the Competition Act with the Office of Fair Trading, they will provide necessary safeguards to ensure that the interests of patients are protected.

To pick up on the sorts of circumstances cited by the noble Lord, Lord Whitty, that would include, for example, safeguarding against providers exchanging information to agree lower levels of service quality than they would otherwise supply if they were in competition; or a commissioner removing a well performing provider from the choices available to patients, or seeking to direct patient referrals to one provider and not another on non-clinical grounds.

However, it is not the case that every arrangement in the provision of healthcare that had the effect of restricting competition would necessarily be anti-competitive. I made that point in one of our earlier debates. I look particularly in the direction of the noble Lord, Lord Whitty, in saying that Monitor's core duty means that patients' interests will always come first. For example, in some cases limiting competition by concentrating specialist services in regional centres or in providing services through a clinical network may deliver overriding benefits to patients and would not, therefore, be anti-competitive. Similarly, where an integrated service raises competition concerns, and equally where services offering more choice and control raise concerns over integration, Monitor will always come back to its core duty-to ask itself the question, "What is it that benefits patients the most?".

4.45 pm

The Government appreciate the clear consensus for further integration and more joined-up services. Integrated care pathways can enable increased collaboration between

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hospitals and clinicians, between public and independent sector services and between health and social care providers. The Bill seeks to encourage and enable that. In addition to powers relating to competition, Monitor has an overarching duty to enable integration where this would improve services or reduce inequalities for patients.

Monitor will have a range of functions at its disposal to achieve this-for example, supporting the NHS Commissioning Board in identifying and spreading good practice in the development of reimbursement systems. Here I am particularly addressing Amendments 286A, 287 and 287B. Monitor would also be able to use its licensing conditions to enable integration, subject to the making of regulations provided for in Clause 95(2)(h)-for example, to reflect principle 4 of the existing Principles and Rules for Co-operation and Competition and require providers to exchange information with commissioners and other providers to ensure that the patient experience is of a seamless health service, regardless of organisational boundaries.

I am also sympathetic to the intention of Amendment 274B as I agree that it is important that Monitor is transparent in managing conflicts effectively, including where there may be decisions to take on matters of integration. However, I believe that the requirements already set out in the Bill are comprehensive. This is because resolving a conflict that has a significant impact on the integration of services would also have a significant impact on patients or persons who provide healthcare services.

I turn to the specific issues on the reviews that the Bill proposes are undertaken by the Competition Commission of competition in the provision of NHS services and the exercise of Monitor's functions. I have listened carefully to the various arguments and concerns that have been put forward about this proposal and, as I have intimated previously, I will reflect further on the points that have been made on these reviews, with a view to bringing forward proposals on Report.

I turn to Amendment 266, which is where we began. I do not take exception to the idea put forward by the noble Lord, Lord Warner, at least in principle, but Monitor would have the power to carry out the kind of review that the noble Lord suggests that it should. I am not sure that it would be helpful to compel it to use its resources in exactly the way that he proposes. The particular issue here is the timing. It might be helpful for any such review to be later, once the reformed system is more established.

Amendment 267ZDA provides a definition of integration, referring to services being independent of organisational barriers. I am sympathetic to what it is trying to achieve but I am not sure that the proposed definition, which focuses largely on structures and processes, fully captures integration seen from the point of view of the patients. We see integration as a means of improving patient outcomes rather than-to return to an earlier theme-an end in itself. We do not want to be prescriptive about how commissioners decide to integrate services.

Amendment 269, which the noble Lord also proposed, would remove the provision that Monitor should exercise its functions with a view to preventing anti-competitive

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behaviour in the provision of NHS services. It is important that Monitor plays this role to protect patients' interests against collusion and so on. However, if these amendments were accepted, Monitor would still have its concurrent powers with the OFT but would not be required to use its other functions, such as licensing, to tackle abuses or distortions, and that would be retrograde.

The noble Baroness, Lady Finlay, in her Amendment 268B also brought us to the subject of integration. Monitor will enable integration, as I have already said. It will be for commissioners to drive that. Monitor would have to publish an annual report on how it had discharged its functions and Schedule 8 gives the Secretary of State the power to ask Monitor for specific reports. This could include how Monitor was discharging its duty to enable integration.

Amendment 267ZDA again is one that I am sympathetic to but I come back to the criticism that I made earlier that it is rather structure and process orientated. While I am with the noble Lord in spirit perhaps he would like to think again about how that amendment might be worded. He asked me about confidentiality and business interests in the government amendments-these would indeed apply to all providers whatever their sector and whether an individual or an organisation.

The noble Lord, Lord Whitty, asked whether an aggrieved provider could appeal beyond Monitor. The answer is no. What the noble Lord has described would be an issue of procurement and not competition law. Commissioners, as long as they work within guidance and regulations, can decide when, how and if to use competition, including whether to restrict the number of providers to maintain service quality and sustainability.

Finally, I turn to the amendments that it falls to me to speak to in this group. Both of them are minor and technical; their purpose is to tidy up the Bill and I hope that they will be agreed when moved.

Lord Warner: I want to briefly respond to what the noble Earl said about Amendment 266, particularly in the light of the points that the noble Baroness, Lady Murphy, made about a good deal of anti-competitive behaviour being already quite well entrenched in the NHS. Simply waiting longer to get it even more entrenched before Monitor has a go at the issue of the barriers for new entrants to the NHS market simply gives the signal to the NHS that it can go on as it has been going on. It seems to me that it is important to give a signal that there is a new show in town and that the issue of the barriers to entry, particularly in the light of the report by the Co-operation and Competition Panel, are going to be addressed. I am not sure that waiting longer for the new systems to settle down is going to be in the best interest of the NHS or Monitor and I wonder if he might think a bit more about this and perhaps we could have a further discussion.

Earl Howe: My Lords, the noble Lord makes a telling point. I took on board entirely what the noble Baroness, Lady Murphy, said in her contribution. I will of course reflect further in the light of what the noble Lord has just said.

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Lord Warner: I beg your pardon. I am rather dozy this afternoon on this group of amendments. I beg leave to withdraw the amendment.

Amendment 266 withdrawn.

Amendment 266A had been withdrawn from the Marshalled List.

Amendment 267 not moved.

Amendments 267ZA to 267ZD had been withdrawn from the Marshalled List.

Amendment 267ZDA not moved.

Amendment 267ZDB

Moved by Baroness Finlay of Llandaff

267ZDB: Clause 59, page 88, line 6, at end insert-

"(c) local authorities carry out their duties in providing social care for children in their area, and to the smooth transfer of their caring responsibility when a child moves into adult social care services."

Baroness Finlay of Llandaff: My Lords, this group of amendments concerns children, particularly their social care. We have laid these amendments because we could find nothing in the Bill that mentions this. Children's services will be commissioned potentially by six different groups. The Commissioning Board at national and at sub-national level, particularly through health visitors, will be responsible for the public health of children under five-until 2015 when that will transfer to local authorities-and also for primary care. That is often the first point of contact for problems in children which require a great deal of social care intervention integrated with healthcare provision. Public Health England is responsible for public health campaigns and health protection. The clinical commissioning groups will again be involved potentially at two levels; supra-locally and locally. The sixth area is the local authorities with the healthy child programmes for those aged five to 18, school nurses and child health for the nought to five year-olds after 2015, which is when the health visitors transfer.

However, all these different aspects of healthcare interrelate very closely with children's social care. There are concerns over accountability, how the services will keep track of complex provision and who will be responsible for children's health and welfare, particularly as regards obese children and those who have been bereaved. There is concern about children's reaction to grief and the impact that this has on social behaviours, and how the public health services which deal with the prevention of childhood obesity can be evaluated and held to account.

Health visitors are the eyes and ears of the child aspects of primary care. However, there is concern about how they will relate to the primary care and accident and emergency sectors and social workers when they transfer to local authorities. How will the information on the at-risk register be transferred and how will access to primary care records be speeded up? Will the IT systems be compatible to enable effective information transfer between child and adult services, particularly when children who have multiple social

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problems reach an age when they will be transferred to adult services? There is particular concern about children with severe learning difficulties and developmental delays who require a great deal of social care input. They cannot be their own advocates and are extremely dependent on others. Therefore, it is important that the relevant information is successfully transferred. We know from previous tragic child abuse cases that information which has to be moved from one sector to another often gets lost, drops through the gaps and children suffer as a result.

There must be a smooth transition from one carer to another, particularly where children's and adult social services are provided by different providers. It is important that adult social services should be satisfied that the children's social services have done their job properly and thoroughly because, if they have not, the patient will suffer and adult social services may be faced with an unfair cost incurred as a result of a deficiency in the services provided by the children's social services.

Our amendments do not propose a radical solution to the problem. We are fairly confident that the Government will not accept them as they will not want further major complications in what is already a very complicated Bill. They are simply designed to provide that at some time in the future Monitor will be given the power to check that all providers of children's social care are doing their job properly, and that when they transfer a child to adult social care there is a smooth and sensitive transfer of responsibility and a complete transfer of information so that there are no gaps through which these children can fall.

We look forward to hearing what the Government's solution is to this problem. We rather hope that the Minister might offer us some discussions outside the Committee to try to address some of the real problems that arise when children, including those aged nought to five, transfer from children's services into adult services, given the gaps in information provision which can occur at the transition point. I beg to move.

5 pm

Lord Beecham: My Lords, it saddens me to say that 41 years ago I became opposition spokesman on the Newcastle City Council health committee. Within two years, we had the Seebohm report and a change of structure, leading to the creation of a social services committee that embraced both children's and adult social care and replaced two committees-the old health committee and the old children's committee. That seemed to me then and, frankly, it seems to me now to have been the right approach, because I do not think that you can sensibly divide children's and adults' social services. We do not have that system now. My personal view-which is not necessarily the view of the Opposition-is that it may be time to look again at that division. To an extent, the group of amendments that the noble Baroness has spoken to seeks to secure that objective.

As a consequence of the way in which amendments are ordered, the actual order of the amendments in this group is not quite logical. I suppose one should start with Amendment 269B, which would give Monitor functions relating to children's social care services.

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Earlier, we touched on the possibility of Monitor having a role in respect of adult care services. Presumably, one would look at both services coming under their auspices, or neither, rather than keeping a division. Amendment 269B sets out the basic role for Monitor in this context. I note that proposed new subsection (2) would include within the functions,

I am tempted to say "and vice versa", because so often problems of parents and adults impinge on the needs of the children, and that would make perhaps a more rational disposition of functions.

The other two amendments in this group are, in effect, consequential, and sensibly would require local authorities to ensure a smooth transfer and, as Amendment 270AA puts it, "a careful handover" for children moving into adult social care. All of those seem to me very sensible suggestions. Nevertheless, it is probably better to look at the whole context of where social services fall within the remit of the Bill.

I imagine that there will have been some discussions between this department and the Department for Education, although the way in which Whitehall and, for that matter, local government tend to work, it is not necessarily the case that the relevant organisations come together to discuss these issues. It may be, therefore, that the Minister would wish to consult colleagues in other departments before giving a measured response. Perhaps this matter might be best brought back at Report, because it raises significant issues. As I have indicated, I have felt for some time that the division of responsibilities at the moment is not terribly sensible, with children's social services being, arguably, at best a sort of fifth wheel on an education coach. At the very least, that matter ought to be re-examined. Perhaps it is too late in the day for it to be part of this Bill, but at some point, I think, this issue certainly needs to be referred to. I congratulate the noble Baroness and the noble Lord, Lord Northbourne, on having put down this amendment, which gives us an opportunity at least to ventilate concerns about this issue.

Earl Howe: My Lords, I understand and well appreciate the concern of the noble Baroness to ensure a high standard of children's social care services and, in particular, a smooth transfer for young people moving from children's to adult social care services. I would, of course, be very happy to speak to her and indeed the noble Lord, Lord Northbourne, about this issue away from the Committee, if they consider that to be an appropriate way forward.

On the specific amendments that we are looking at, I really do not think that Monitor is the right organisation to ensure that local authorities are carrying out their responsibilities on these issues, or to act as a regulator of children's social care services. I am confident that existing arrangements for the regulation and inspection of children's social care are sufficient and robust. Joint working is important and I hope that the noble Baroness will be reassured that the relevant inspectorates are already working together to improve the arrangements for joint inspection, which will address the very important issue of child to adult transition that she has raised.

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Children's social care is regulated and inspected by Her Majesty's Chief Inspector of Education, Children's Services and Skills-Ofsted. Its inspection remit covers all local authority social services functions relating to children-that means services for children in need, safeguarding children, children in care and care leavers, as well as adoption and adoption support services. Local authority adoption and fostering functions must be inspected by Ofsted at a minimum of every three years. Ofsted can of course make unannounced inspections.

We are already working to improve these arrangements. Ofsted consulted over the summer on local authority child protection inspection arrangements that will be more child-centred and less bureaucratic. This new type of inspection will begin in May next year. In addition, all relevant inspectorates have agreed in principle to Professor Eileen Munro's ideal model of joint inspection, which looks at the contribution all services make towards protecting children. Noble Lords may recall that Professor Munro last year conducted a thorough review of child protection arrangements for the Government. The Care Quality Commission is one of the inspectorates working with Ofsted to establish what those services will look like and when they will begin.

For children with special educational needs and disabilities, the recent Green Paper proposes a new education, health and care plan, covering support from birth to 25. The new plan will include a much clearer focus on the long-term outcomes for children and young people including independent living and employment. This should improve outcomes for young people with special educational needs and disabilities as they make the transition from school into employment or training.

I hope that the noble Baroness will appreciate that work in this area is ongoing. I sympathise with the tenor of all she said, but if she is content to wait for a discussion following these Committee proceedings, I hope that she will, in the mean time, withdraw the amendment.

Baroness Finlay of Llandaff: I am grateful to the noble Earl for his response. It is those transitional points that we have been particularly concerned about. I will discuss this with the noble Lord, Lord Northbourne, and it would be helpful for us to have a short meeting. We are grateful for the fullness of the response from the Minister. I beg leave to withdraw the amendment.

Amendment 267ZDB withdrawn.

Amendment 267ZE had been withdrawn from the Marshalled List.

Amendment 267ZF

Moved by Lord Clement-Jones

267ZF: Clause 59, page 88, line 10, at end insert "and Monitor must obtain advice from Healthwatch England for enabling if effectively to discharge that function"

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Lord Clement-Jones: My Lords, I am sure that this was well worth waiting for, but it could be the mouse that roared. We are back to other aspects of Clause 59 on the general duties of Monitor. This amendment and Amendment 267ZB simply aim to ensure that to discharge its functions Monitor has input from HealthWatch England. That is all about patient and public involvement. It seems to me and to my noble friends that Monitor should definitely insert such input into its deliberations. I cannot find in the rest of the Bill any other such duty on HealthWatch England, which after all will have an extraordinarily important role. Many noble Lords have welcomed the new enhanced role for patient and public involvement. I remember the demise of community health councils and the hard-fought debate that took place in about 2004-I cannot remember exactly when-and I very much welcome the new enhanced role for HealthWatch England. However, Monitor will need to be informed by it and I very much hope that the Government will take this on board. I beg to move.

Baroness Murphy: I realise that I have another amendment in this group, and I would have saved the Committee a great deal of disquiet over the numbers if I had spoken to this one in the first place, so my apologies all round. This group of amendments is about how Monitor discharges its functions and what it takes into account. Mine is a probing amendment on whether we have the objectives for Monitor and their number right. Experience from other sectors suggests that if too many policy priorities are set, the regulator can become confused about its primary objectives, which can reduce its effectiveness. I wonder whether we have the clarity of Monitor's objectives right.

Monitor will find itself in the position of other regulators in having to devise policies, particularly on the tariff, to meet a wide range of objectives over and above its primary duties. The experience of Ofgem, in particular, suggests that the risk might grow over time as the Government seek solutions for new problems as and when they arise. Setting too many policy priorities carries the risk of confusing the regulator about its primary objectives. That might be inevitable, given the complexity of healthcare policy-making, but it means that the accountability of the regulator in discharging those various functions is critical.

For other major economic regulators, the Government have committed themselves to updating the objectives only once in a Parliament and ensuring that objectives are outcome-focused. Monitor's objectives, unusually, will be set in primary legislation. I wonder whether they would be better in secondary guidance, together with a clear process for agreeing changes with the Department of Health, to protect the regulator from political whim. Nevertheless, it has a number of primary duties in Clause 59. In Clause 62 it has to have regard to a number of other matters. Monitor might find it difficult to demonstrate that they are all taken into account when decisions are made, possibly making it open to legal challenge. I wonder whether it is possible to reduce the number of duties.

I have included just one or two as exemplars simply because I think that they duplicate existing duties. In Clause 62(b),

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which is crucial, duplicates a primary duty in Clause 59(1)(b), so I think it could be removed. Clause 62(c), on,

duplicates a duty under Clause 59(1)(a). Surely that could be removed. These are minor, tidying amendments, but if we can clarify for Monitor what its objectives should be, that would be a help to the regulator.

Baroness Finlay of Llandaff: My Lords, I half spoke previously to the need for Monitor to have regard to complex clinical conditions. I return to that and build on the comments that have just been made, particularly in relation to tariffs.

We are already beginning to see a degree of fragmentation through systems such as "choose and book". We heard on a previous day in Committee about the problems for patients with various complex conditions, who have to be sent back to their general practitioner to be able to access a different discipline in secondary care and how their care then becomes fragmented. If you are going to provide good integrated care and improve clinical outcomes, you need all the different systems of the patient to be addressed simultaneously-the psychological and welfare areas as well as the different physiological systems that might be affected by a range of pathologies.

I remind the House that it is much easier when people are not terribly ill. When they do become terribly ill, more and more systems fail and become involved: cardiac complications, overwhelming infection, renal failure and potential dialysis might all be involved, and if there has also been trauma with orthopaedics there might be a lot of complex psychological conditions relating to whatever has happened to the person. They all need to come together around that patient. The patient cannot be parcelled off from one service to another or people be brought in sequentially like small aliquots of opinion.

5.15 pm

Therefore, in setting the tariff and establishing the way in which services are looked at and licensed, the point of the amendment is to make sure that the multiple complexity that arises, and that is very common in patients who are seen in high-dependency intensive care or even in the sick patients who are brought into accident and emergency, is taken into account and that the tariff does not oversimplify, and therefore inadvertently narrow down, the services available to the patient and result in worse, not better, clinical outcomes. Earlier today the Minister was very clear that the point of the Bill is to improve the quality of patient outcomes, to improve the efficiency and productivity of services and to provide better value for money, as well as to drive up the outcomes for patients. That is why we felt it was important that this was considered.

Lord Warner: My Lords, I apologise that my enthusiasm for Amendment 274ZZB caused me to speak to it partially in an earlier group. The amendment in my name and that of the noble Baroness, Lady

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Pitkeathley, was put down because we regard it as a probing amendment to the end of Clause 62 that relates to matters that Monitor must have regard to in the exercise of its functions. Its purpose is to raise the issue of the financial stability and governance of adult social care providers in the light of the Southern Cross experience, and to seek the views of the Government on how they propose to use the new regulatory system in the Bill to protect the vulnerable users of adult social care services from providers whose financial structures are fundamentally unstable.

Let me say at the outset that I thought that the Department of Health managed quite well the difficult situation that Southern Cross presented. Few, if any, elderly people had their care seriously disrupted. 20/20 hindsight is a wonderful thing in public policy post-mortems. The truth is that across the political spectrum few were alert to the dangers of overleveraged providers of adult social care. However, we are now alert to the dangers of creative financing arrangements in this area, particularly those instituted by boards of management that do not hang around to face the consequences of their action but simply take the money and run.

It is clear that the way in which care providers are financed and their governance wraparound are matters for rigorous inquiry before they are allowed to contract for the provision of services to vulnerable people. In the case of adult social care, this relates not simply to elderly people whose adult social care is funded by the state but to self-payers. Most of these service providers have a mix of state and self-funders in their homes, with many of the self-funders in effect subsidising the state-funded residents in today's inadequately funded, state-financed, adult social care. That inadequate funding is itself going to cause some providers to withdraw from the market, and others to merge. It will also distort future investment decisions by those who wish to enter this market, because they will favour investments that concentrate on self-funders.

We face a period of turbulence and uncertainty in the adult social care provider market that makes the detailed working of the regulatory system even more important. That is particularly the case with the positive flood of findings of unsatisfactory care of elderly people in the NHS and adult social care environments. The question of how providers are financed and governed is an integral part of ensuring stable and quality care environments for vulnerable groups. A bright light needs to be shone on these areas in a new regulatory system. Can the Minister say how the Government are going to proceed on this issue and what role Monitor should play? Do the Government intend to move quickly to bring adult social care into Monitor's remit, or do they see some other approach being pursued? I recognise the heavy burden that is already being placed on Monitor and the range of things that it now has to do. However, I think that the Committee needs to know whether and when this will be transferred to Monitor or whether other mechanisms will be used. The purpose of this amendment is to find out the Government's intentions.

Lord Walton of Detchant: My Lords, I support the amendment proposed by my noble friend Lady Finlay because this is an extremely important matter. When

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I was a consultant working as a neurologist in the NHS, if I had a patient who, for instance, had a peripheral neuropathy and turned out to be diabetic, I had no problem in referring him to a colleague within the same hospital for the care of his diabetes or to a colleague in the ophthalmology department for the care of his eyes. I am horrified to discover that in the recent past such individuals have been told to go back to their GP for yet another referral to a different consultant. This is an extraordinary situation. Can the Minister assure us that something in the Bill will stop this kind of nonsense occurring?

Baroness Pitkeathley: My Lords, I speak in support of Amendment 274ZZB in my name and that of the noble Lord, Lord Warner. In the debate on Wednesday last, the noble Lord, Lord Warner, referred to health and social care as being in a symbiotic relationship. That is supposed to be recognised in the title of the Bill, but in fact we have had very few debates about that relationship, other than the fact that everybody says that integration is important and that patients do not understand why such integration has always proved so difficult. We agree that, as patients' needs are comprehensive-especially patients with long-term conditions-we need comprehensiveness in addressing those needs.

The other thing that we always agree about is that, to meet the Nicholson challenge, services have to be reconfigured so that more services are provided in the home and in the community, instead of in expensive hospitals. Today's King's Fund report reminds us of the difficulties that many London hospitals are currently facing, yet reconfiguration is still resisted, not least sometimes by MPs, who should know better.

Another thing on which there is usually agreement is that as social care is just as important to patients and their families as healthcare, it should be given the same status as healthcare. We may agree about that, yet social care plainly does not have that status, despite the commitment to care services of the Minister, his officials at the Department of Health and indeed the noble Earl himself. This amendment seeks to ensure that, no matter who the provider is, the provision of adult social care services is on a sound financial footing and with corporate governance that ensures proper oversight. That is surely necessary beyond question, given the recent Southern Cross debacle to which my noble friend has referred, with the prospect of more such disasters.

As we know, health and social care have always been organised and funded by different groups-one centrally and the other by local authorities. However, as my noble friend reminded the Committee in a debate last week, the majority of the money spent on adult social care by local authorities is in fact funded centrally and passed to local authorities, which commission the services. This amount of money is not sufficient, especially in view of the fact that rising demand has been well established, most recently by the Dilnot commission. It seems that the only way to get more money into the system in these hard times is, first, by showing that money spent on social care will save money in the long term and, secondly, by ensuring that the money is effectively, efficiently and safely

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spent. Involving Monitor in the way suggested in this probing amendment would go a long way to enabling us to do this better. I can do no better than quote from the noble Baroness, Lady Barker, when she said in our debate last Wednesday:

"The biggest single thing that will make the Bill work or not work is whether everyone in the NHS sees it as their responsibility to understand and work with social care".-[Official Report, 7/12/11; col. 759.]

Placing this responsibility on Monitor or otherwise advising the Committee how that responsibility will be exercised would be very important in helping us to achieve that aim.

Lord Nickson: My Lords, I am afraid that I was not present at Second Reading but I am moved to support this amendment on a personal basis as my wife is in long-term social care in Scotland. It was a Southern Cross home that has now been taken over by Healthcare One. It would have been a comfort to me had I known that an organisation such as Monitor was supervising the very unhappy situation in Southern Cross, but I have to say that the communications from the local authority concerned in Scotland both with me and Southern Cross as it was in its death throes were absolutely first class in attempting to reassure and keep us in touch with what was happening. I am equally glad to say that all the information and everything coming now from Healthcare One is very reassuring and makes one full of confidence. It would have been reassuring had something like Monitor been in the background looking at this sort of situation well in advance. I support the amendment.

Lord Beecham: My Lords, I am happy to endorse all the amendments in this group, with the exception of Amendment 270. I particularly endorse Amendment 274ZZB tabled by my noble friend Lord Warner. He is 100 per cent right in this context. I have to say in confidence to the Committee that I do not always entirely agree with my noble friend, but he is exactly on the right lines today. The situation to which he referred clearly causes great concern. We heard from the noble Lord, Lord Nickson, that fortunately matters turned out reasonably well in his case and that of his wife, but who is to say that that would always be the case? I hope that the Minister will feel able to take on board the suggestion made by my noble friend Lord Warner. As he said, it is a probing amendment but it is one that I hope will lead to an outcome that will guarantee that problems of the kind generated and disclosed in the Southern Cross affair will not arise again so that those in residential care and their carers and families will have greater confidence in the system-a confidence that must have been shaken by events in recent months.

Baroness Northover: My Lords, this is the group of amendments that we almost came to earlier this afternoon. I hope that noble Lords who thought that their issues would be in that last group have now gathered them together, as they are back in this group. The amendments cover a number of issues, including patient and public involvement in Monitor's work and the advice that it should take. The Government are clear that Monitor

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should involve patients and the public in its decisions and get appropriate clinical advice to enable it to carry out its functions. That is why in another place we introduced Clause 59(7), which creates a duty on patient and public involvement, and Clause 59(8), which creates a duty to obtain clinical advice. For Monitor to carry out effective patient involvement, it will almost certainly need help from people or organisations with expertise. Here I address in particular Amendment 267A, and Amendment 267B in the name of my noble friend Lord Clement-Jones and others.

However, setting this out in the Bill could constrain Monitor's flexibility to decide how and when it sought such help. We do not want to create bureaucratic and potentially costly arrangements that would require Monitor to take such advice even when it was unnecessary. I hope that, over time, Monitor will develop expertise in how best to involve patients and the public in its decisions, reducing its dependence on professional advice in this area.

5.30 pm

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