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These amendments are part of creating a coherent and consistent framework within the new structures established by the Bill, to ensure a single and purposive approach by all the bodies within the NHS, with the Secretary of State remaining in charge of setting the strategic objectives for the service. In those circumstances I suggest that they are very welcome.
Baroness Meacher: My Lords, I rise with some trepidation, not having been involved in Committee on this Bill but having been upstairs in Grand Committee on another Bill. I therefore have not done the learning that I know noble Lords around the House have done during that process.
Many noble Lords have referred to the term "competition" without distinguishing between competition within the NHS between public sector organisations and competition between public sector and private sector organisations. It is perhaps relevant for me to quote recent research by Zack Cooper and colleagues at the London School of Economics. It came out in February, since Committee, which is my justification for introducing research at this late stage of the Bill. That research looked at competition between public service NHS organisations on the one hand, starting in 2006, and between the different forms of organisation, the private and the public, on the other hand, starting in 2008.
This considerable research looked at 1.8 million patients, 161 public sector hospitals and 162 private sector hospitals and should be taken seriously. It showed that the result of public sector competition was a reduction in lengths of stay both pre-surgery and
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This research also shows that when you look at the competition between the private and public sector organisations, you will find an increase in the length of stay in the public services, albeit that there perhaps is a marginal improvement financially. If you look at the whole policing and monitoring apparatus that you need in far greater proportions once you have all this competition, I am not sure that you would even achieve a financial benefit. However, you find a reduction in quality, most particularly for people with long-term conditions. That is why I needed to speak in this debate.
I hope that whatever happens on these amendments, great care will be taken to protect public service provision. If we do not prevent the cherry picking, which happened in the provisions studied by this research and has occurred in other settings examined by research, without any question we will achieve a two-tier service with the private sector cherry picking the easier and healthier patients and the public sector having the complex care. I know that this issue will have been rehearsed at length in Committee. I do not want to go on further but it is important that we do not just use the word "competition" without clearly differentiating the competition that we are talking about.
Lord Ribeiro: For clarification, perhaps the noble Baroness would say whether we are dealing with apples and pears here. She made reference to the private sector and chronic care whereas she said specifically that the earlier 2006 report related to surgery. My understanding is that quite a lot of the competitive work done in the NHS involved ISTCs. These contracts were held by private practitioners and private companies. I have not read this report but we need clarification as to whether we are dealing with a level playing field of NHS provision or whether this is NHS provision against private provision.
Baroness Meacher: I am grateful to the noble Lord for his intervention. I was trying to conflate a number of points. The research that came out in February has to do with surgery but the point is that those findings support earlier studies which looked at a mixed public-private market by Allen and Gertler in 1991 and Ellis and McGuire in 1986 and others. Their research also showed that if you have private and public services competing with each other, you will see the cherry picking and the detriment to the long-term conditions to which I have referred. I am sorry that I slightly skipped a few things and compounded them into one. The findings are absolutely consistent whether they are concerned with surgery or other settings.
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Lord Adebowale: My Lords, I had not planned to speak in this debate but, having heard the contributions of many noble Lords, it is important perhaps to indulge in reminding the House that competition does
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The debate around competition becomes polarised very quickly, as has been pointed out in earlier contributions to this debate. I am in favour of competition. It seems to be currently the case in the NHS that we have competition. I am concerned about the way in which the market is managed. Let me illustrate this with an example: it is possible for a new entrant into a care market-say, delivery of community health services -with very little experience in that market to win a substantial contract against an incumbent provider with vast experience and an excellent track record simply because the interpretation of the way in which procurement rules need to be managed means that that a not-for-profit provider gets ruled out. That happened recently in reference to the provision of community health services in Surrey and the Surrey nurses.
The safeguards that I want to see in regard to competition are those that protect public taxpayers' money in the procurement of health and social care services. Again, we tend to concentrate on hospitals, surgery and related issues. These days, the health service is as much about what happens in the community. I am concerned that we have safeguards in place to protect health and social care services from new incumbents with a poor track record, or no track record, which can bid at or below cost and win simply because the procurement rules rule out not-for-profit providers who may not be able to access capital. I refer to the intention of this Government to bring in laws that would encourage social value and social enterprise.
It would be helpful for the House to be reminded that the players in the health and social care market are no longer just public and private. The market has to be managed in favour of a mixed economy and in favour of retaining resources in the public realm that could be pulled out in a simple battle between private capital and public service. I hope that my contribution has made sense and I apologise for keeping the House.
Lord Turnberg: I shall speak in support of Amendment 165 in the name of the noble Baroness, Lady Finlay of Llandaff. This amendment is designed to ensure that Monitor encourages integration and collaboration. In all that, it is important that Monitor ensures that the operation of the system of payment by tariffs does not interfere with that integration and, at worse, adds to the costs of the health service.
I shall give two examples of where the tariff system might be counterproductive. The first is in relation to the hospital admission of a patient who goes home, is readmitted and may be readmitted several times. It is in the hospital's financial interest to have these episodes of care because it gets paid by the tariff each time the patient comes in. There is no inducement in the hospital to try to enlist social services. I am sure that it does, but the system works against that and tends to promote readmission as a way of earning money.
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The second concerns patients who are in the hospital for one condition and develop a condition relevant to another consultant. For example, a patient may come in with an orthopaedic problem such as a broken hip, and then develop an acute episode of diabetes, so there is a need to call for a diabetologist to look after the patient's diabetes. That requires a rather tortuous consultation process which involves a second episode and a further payment by the tariff system. Those are two obvious and common examples of where integration is interfered with by the system we are operating.
I know that the Government are not keen to change that sort of system, but there must be ways for Monitor to look at it critically and see whether the current tariff system can be made to work better than it does at the moment. I hope that the noble Earl will be able to comment on that.
Baroness Wall of New Barnet: Perhaps I may contribute to the debate solely on the comments that have just been made by my noble friend. As regards the first instance he mentioned, that is no longer the case. If someone is brought back into hospital with the same disease or illness, no tariff is paid. As far as I am concerned, that is certainly the guidance we have had from the Department of Health and it is being applied. It is still the case with regard to the second example- I guess quite rightly. But from my experience as the chair of a foundation trust-my noble friend Lord Hunt is nodding in agreement-if someone is admitted again with the same illness there is a presumption that they were not dealt with properly in the first place. As a result, the treatment has to be carried out under the first tariff and no additional tariff is granted.
Lord Turnberg: My Lords, I wonder whether I could comment on that. It depends on the timescale between admissions. If it is longer than two months, I think that you get a second shot.
Baroness Murphy: My Lords, this is a disparate group of amendments. I support the principles that underline Amendments 164, 165 and 166. The Bill has been amended since the Committee stage and may address some issues, and that is one of the difficulties when we discuss competition, collaboration, integration and co-operation. We will have yet another amendment later today or on Thursday from the Government on the duty of co-operation that will further strengthen the role of Monitor in regard to these issues. That, I think, will meet some of the arguments.
My feelings are consonant with those of the noble Baroness, Lady Williams. I am furious at some of the debates in the press about whether we are marketeers or pro-NHS. In fact, the vast majority of people in this House steer a course in order to do what is in the best interests of patients in terms of competition, collaboration and integration. I acknowledge that many of us must feel the same as the noble Baroness in her frustration about that.
The intervention of my noble friend Lord Adebowale was helpful in that it reminded us of how competition has worked in mental health services and substance misuse services. For many years collaboration between
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I have a question to ask of the Opposition in relation to Amendment 163BA. This is the first amendment in the group, and perhaps the noble Baroness, Lady Thornton, could help me in one respect. I am not quite clear whether this amendment would return Monitor to the position it is in now-where we would continue with the two-tier system of foundation trusts and other trusts with a simple economic regulator for foundation trusts-and would rule out the rest of the new economic regulation functions. If it has that effect, it would seriously wreck the main purpose of the Bill. However, I may well be reading it incorrectly, so before I decide which way to go, I wonder whether the noble Baroness, Lady Thornton, could reassure me that that is not the purpose of the amendment.
Earl Howe: My Lords, there is a clear purpose to Part 3. It is to strengthen sector regulation of healthcare in England by building and improving on Monitor's existing role as the regulator of foundation trusts. It does that in three main ways. First, it makes clear that Monitor's overriding duty would be to protect and promote patients' interests. Secondly, it makes sector regulation more comprehensive by extending Monitor's remit to all providers of NHS services. Thirdly, it makes sector regulation more effective in realising benefits for patients; for example, by monitoring the NHS Commissioning Board setting fairer prices for NHS services. Fair pricing is important for a whole host of reasons: to strengthen incentives for improvement, to enable better integration and to reduce the risk of cherry picking.
I shall deal with a simple point. Monitor will continue as the regulator of NHS foundation trusts. The Bill makes that crystal clear in Chapter 1. However, I am most grateful to my noble friend Lord Clement-Jones for highlighting the need for greater clarity on what intervention powers Monitor would have over foundation trusts on an enduring basis as against what would be transitional. I shall say more about that when we come to debate his amendments in a later group.
Before going on, let me address Amendment 167 from the noble Lord, Lord Hunt, on the specific issue of patients' rights to refuse consent for treatment in the NHS. I can absolutely assure the noble Lord that these rights must be protected and nothing in the Bill would change that.
Returning to Part 3 and the role of Monitor, its overarching duty will be to promote economy, efficiency and effectiveness in the provision of healthcare while maintaining or improving quality for the benefit of
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Let me briefly address Monitor's role in ensuring that where there is competition in the provision of healthcare it operates in the interests of patients. We will have an opportunity to consider this issue in more detail later. Decisions on whether and when to use competition will be a matter for clinical commissioners. As I have already said, there have always been private and voluntary providers in the NHS. Anyone who reads Part 3 will see that it does not create markets for NHS services, despite what some others have said. This is not the same Bill as that which was debated in the Committee of the House of Commons in March 2011. It has changed significantly as a result of amendments tabled by the coalition in response to the NHS Future Forum.
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Of course, as I made clear earlier, we already have some competition in the NHS. Indeed, this was increased under previous Labour Governments; for example, with the independent sector treatment centre programme in 2004 and the introduction of "any willing provider" in 2008. This was followed up with guidance published in March 2010 which made it clear that there should not be preferential treatment of public bodies over independent providers of NHS services. I have placed a copy of that guidance in the Library for noble Lords who are interested.
Where commissioners decide to use competition to increase choice and improve NHS services, this Bill seeks to strengthen how that is regulated so as to protect patients' interests. Nothing in this Bill would extend competition to particular services or privatise NHS institutions. Nor would the Bill force commissioners to tender services or enable Monitor to impose that, as the earlier amendments to which I referred make clear. On the contrary, regulations under Part 3 would provide for commissioners, not Monitor, to decide when, how or if to use competition as a tool for improving services. That is the right thing to do because these decisions should be made locally, driven by patients' needs and priorities for improving quality.
We have, however, listened to the concerns that people raised about the emphasis on competition in the Bill, as it was originally drafted, and we responded to them by making changes to make it clear that Monitor will not have a duty to promote competition. This reflects recommendations of the NHS Future Forum that competition in the NHS should be used only as a means to an end in improving services, never as an end in itself.
Monitor's role in regulating competition in the NHS would be limited to addressing anti-competitive behaviour that harmed patients' interests. It would
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It is important to remember that Monitor will work with the Commissioning Board to design tariffs which best incentivise high-quality patient care, including through integration. That brings me to the point made by the noble Baroness, Lady Meacher. The Bill addresses the situation where a private provider could cherrypick the most profitable services to deliver, leaving an NHS hospital with the most complex procedures. It requires Monitor and the NHS Commissioning Board to take account of variations in the range of services provided by different providers, and the complexity of the needs of patients treated, to ensure a fair level of pay for providers. As a result, providers undertaking only the more simple interventions would be paid a suitably lower price. We are not seeking to stop providers choosing which services to deliver; the issue is making sure that they are paid a fair price for each of them. If prices accurately reflected the cost of services, private providers simply would not have the incentive to cherry-pick and damage the viability of other providers.
Baroness Meacher: Lower prices may be determined for simpler procedures, but this matter is far more complicated than that. If a lot of the simpler procedures are creamed off, the public sector institution may not be viable, which the research again shows. It is not straightforward. People concerned with long-term and complex conditions fear that over time such a differential organisational and pricing structure could lead to a two-tier system.
Earl Howe: My Lords, it is a concern that I understand. The destabilisation of the NHS will naturally be a concern to all commissioners, which is why they can protect that situation through the contract. They could insist through the contract that a provider provided the full range of services rather than a select few. I simply say to the noble Baroness that we are alive to that concern and I have no doubt that commissioners will be as time goes on.
On the amendment tabled by the noble Lord, Lord Warner, he will be disappointed to hear that I am not drawn to going any further than the Bill does, much as I understand that his idea is well-intentioned. I say that because of Monitor's overarching duty to protect patients' interests and prevent anti-competitive behaviour
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We had a most constructive debate in Committee about the Secretary of State's accountability for securing a comprehensive health service in England and his role in holding Monitor to account for its duties. I thank my noble friend Lady Williams for proposing an amendment which adds much to the Bill in this area. Clause 61 already requires Monitor to carry out its functions in a manner consistent with the Secretary of State's performance of his duty to promote a comprehensive health service. My noble friend's amendment would strengthen these provisions and thereby improve the Bill on a key issue. This would help to ensure that the Secretary of State can discharge effectively his responsibility for the health service in England and that Monitor carries out its functions to that end. I support my noble friend's amendment.
Clause 64 specifies the range of matters that Monitor would be obliged to have regard to in carrying out its duties. In Committee, the noble Baroness, Lady Murphy, and my noble friend Lady Williams raised some concerns about that list. I agreed to reflect on these concerns and have tabled Amendments 168 to 171, which would rationalise the list and make it clear that maintaining patient safety would be the paramount consideration. I hope that the noble Baroness and my noble friend will be content with that rationalisation.
On the amendment tabled by noble friend Lady Cumberlege, the Bill ensures that patient and public involvement is embedded at every level of the healthcare system. However, unlike the NHS Commissioning Board and clinical commissioning groups, Monitor would not be responsible for securing NHS services to meet patients' needs. It is a regulator, with economic and more technical functions. Clause 61 reflects this and gives Monitor the responsibility for determining arrangements for patient and public involvement as appropriate to its functions. So I am afraid that I do not regard my noble friend's amendment as appropriate. She asked what could be done if Monitor did not involve patients in the right way. Well, the Secretary of State would hold Monitor to account as to how it discharged its functions. Monitor would have to report to the Secretary of State on how it was discharging its duty on patient and public involvement as part of its annual report. The Secretary of State could also request a specific report on how Monitor discharged this function and intervene where there had been a significant failure in meeting this duty. The Bill provides for HealthWatch to send advice to Monitor as it seems appropriate. Monitor would then be required to respond to this advice in writing. I hope that my noble friend will take comfort from those points.
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I stress once again that the purpose of Part 3 is to strengthen sector regulation in healthcare to protect and promote patients' interests. The current system is inadequate, fragmented and duplicative. It fails to protect the interests of all patients. Part 3 recognises that the NHS is not and never has been a single institution. The reality of the NHS is a comprehensive health service that has always been delivered by a diverse range of providers.
Part 3 would address gaps in the current system by extending equivalent safeguards to protect patients' interests irrespective of who provides their NHS services. It would also make sector regulation in the NHS more effective in driving improvements and enabling integration during an absolutely crucial period of economic challenge.
I am very happy to support the amendments of my noble friend Lady Williams, which would improve the Bill, but I urge, following the reassurances and explanation that I have been able to give, other noble Lords not to press their amendments.
Baroness Finlay of Llandaff: Before the Minister sits down, will he answer a straightforward question in relation to my amendment? Given that the Bill at page 88 states,
and my amendment, which is not being accepted, states,
will the Minister confirm that that means that competition is trumping collaboration?
Earl Howe: No. Collaboration, if it is in the interest of patients, will always trump competition.
Baroness Finlay of Llandaff: What instances are there of when collaboration has not resulted in improved patient outcomes? I have not been able to find any.
Earl Howe: Nor have I, which is why I listed earlier some prime examples of collaboration. Clinical networks are a prime example of collaborative behaviour which is clearly in the interests of patients. The noble Baroness is asking me to think of examples in my head of collaborative behaviour in the NHS that does not advantage patients. I cannot think of any, which is why it would be hard for Monitor to find fault with collaboration where it has clearly been designed to improve patient care.
Baroness Thornton: In response to that last remark, it depends on whether Monitor decides it is collusion or collaboration. That is the key point. We suggested that that was a problem right at the very beginning of the Bill-how you distinguish between collaboration and collusion and what you do about that. I do not think we are any closer to finding the answer.
I turn to remarks that were made during the course of this very useful if diverse debate. I want to take one moment to say something to the noble Baroness, Lady Williams, and her colleagues and to the noble Baroness, Lady Murphy, about the fact that they feel misrepresented in social and other media. Indeed, as politicians it goes with the territory that you may be misrepresented
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However, the noble Baroness herself wrote in an article in the Guardian on 13 February about dropping the chapter on competition, and in a letter that the noble Baroness and her leader wrote to their own MPs and Peers, they set a high bar for how Part 3 of the Bill might be made safe. It is just and proper that everybody will be looking at the noble Baroness and her friends to see and test whether they have succeeded and met their own aspirations. At the moment, I think that that is open to question. I do not think that it has been achieved. I know that that might be painful, but that is the case.
We have had some thoughtful amendments and contributions. As usual, the noble Baroness, Lady Finlay, in her amendment and questions put her finger on a very important issue that the Bill needs to address even at this late stage. I had a great deal of sympathy with the amendment of the noble Baroness, Lady Cumberlege. I rather hoped that she would get a more positive response than she did and I am sorry about that.
Baroness Williams of Crosby: The noble Baroness is perfectly entitled to say what she had said. I accept that fully and I am sure that she said it in all sincerity. But the difference between us is that I believe that the Government have moved a long way, particularly because of the Minister. I believe that that culmination of changes will enable us to bring about an improved NHS. I may be proved wrong. I freely accept that I may be proved wrong. But I believe that the changes that have been made are so far reaching that we can make the NHS better than it is today. I know that the noble Baroness, who herself has been responsible in her attitude towards the Bill, would wish to see that, even though she may not think that this is the way to do it.
Baroness Thornton: I am not sure whether this is the way to do it. We disagree. I do not think that the Liberal Democrats have achieved it, but there we are. As the noble Baroness said, history will see who is right and who is wrong.
I am extremely pleased to see that the noble Baroness, Lady Meacher, has transferred her attention from the Welfare Reform Bill to this one. She is quite correct that it is impossible to stop the negative impact that has been observed in the studies that she referred to. She is completely right about that. This whole debate illustrates the problem: half of the Bill seems to be there to mitigate the damage that the other half does. What used to be, for example, a clear duty to co-operate-and it was a simple duty-is now dense and complex.
Turning to our Amendment 163B, I should like to say to the noble Baroness, Lady Murphy, that it does not rule out the economic regulator function. That amendment does not seek to do that, so I hope that the noble Baroness, with that reassurance, might support our amendment. We seek to clarify and put beyond doubt that Monitor should have that function. We seek to do it in the first part of the Bill. We want
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we need to make it completely clear that it will continue to do that job.
We are not trying to weaken the role of Monitor. We think that foundation trusts are facing huge risks and huge reorganisation. They need the support that Monitor will offer them. I suspect that the Francis report, as I said earlier, will indeed have something to say about the strength and importance of Monitor as a regulator of foundation trusts. We would like this to be in the Bill because it makes it completely clear that this is an important job that Monitor does and that it should keep doing that job for the foreseeable future. I wish to test the opinion of the House.
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Contents 183; Not-Contents 255.
Adams of Craigielea, B.
Adonis, L.
Afshar, B.
Ahmed, L.
Alton of Liverpool, L.
Anderson of Swansea, L.
Andrews, B.
Armstrong of Hill Top, B.
Bach, L.
Bakewell, B.
Bassam of Brighton, L. [Teller]
Beecham, L.
Berkeley, L.
Bhatia, L.
Bhattacharyya, L.
Bilston, L.
Blackstone, B.
Blood, B.
Boateng, L.
Borrie, L.
Boyd of Duncansby, L.
Bradley, L.
Bragg, L.
Brennan, L.
Brooke of Alverthorpe, L.
Brookman, L.
Brooks of Tremorfa, L.
Browne of Belmont, L.
Browne of Ladyton, L.
Cameron of Dillington, L.
Campbell-Savours, L.
Clancarty, E.
Clark of Windermere, L.
Clarke of Hampstead, L.
Clinton-Davis, L.
Cohen of Pimlico, B.
Collins of Highbury, L.
Corston, B.
Cunningham of Felling, L.
Curry of Kirkharle, L.
Davidson of Glen Clova, L.
Davies of Oldham, L.
Dean of Thornton-le-Fylde, B.
Donaghy, B.
Donoughue, L.
Drake, B.
Drayson, L.
Dubs, L.
Eatwell, L.
Elystan-Morgan, L.
Evans of Parkside, L.
Evans of Temple Guiting, L.
Evans of Watford, L.
Farrington of Ribbleton, B.
Faulkner of Worcester, L.
Filkin, L.
Finlay of Llandaff, B.
Foster of Bishop Auckland, L.
Foulkes of Cumnock, L.
Gale, B.
Gibson of Market Rasen, B.
Giddens, L.
Gilbert, L.
Glasman, L.
Golding, B.
Gordon of Strathblane, L.
Goudie, B.
Gould of Potternewton, B.
Grantchester, L.
Grenfell, L.
Grocott, L.
Hameed, L.
Hanworth, V.
Harris of Haringey, L.
Harrison, L.
Hart of Chilton, L.
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Haworth, L.
Hayter of Kentish Town, B.
Healy of Primrose Hill, B.
Henig, B.
Hennessy of Nympsfield, L.
Hilton of Eggardon, B.
Hollick, L.
Hollis of Heigham, B.
Howarth of Newport, L.
Howells of St Davids, B.
Hoyle, L.
Hughes of Stretford, B.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Jay of Paddington, B.
Joffe, L.
Jones, L.
Jones of Whitchurch, B.
Judd, L.
Kennedy of Southwark, L.
Kennedy of The Shaws, B.
King of Bow, B.
King of West Bromwich, L.
Kinnock, L.
Kinnock of Holyhead, B.
Kirkhill, L.
Knight of Weymouth, L.
Lea of Crondall, L.
Liddell of Coatdyke, B.
Liddle, L.
Lipsey, L.
Low of Dalston, L.
McAvoy, L.
McConnell of Glenscorrodale, L.
McDonagh, B.
Macdonald of Tradeston, L.
McFall of Alcluith, L.
McIntosh of Hudnall, B.
MacKenzie of Culkein, L.
Mackenzie of Framwellgate, L.
McKenzie of Luton, L.
Mallalieu, B.
Martin of Springburn, L.
Massey of Darwen, B.
Maxton, L.
Mitchell, L.
Monks, L.
Morgan of Ely, B.
Morris of Aberavon, L.
Morris of Handsworth, L.
Nye, B.
O'Neill of Clackmannan, L.
Ouseley, L.
Owen, L.
Patel of Blackburn, L.
Patel of Bradford, L.
Pendry, L.
Pitkeathley, B.
Plant of Highfield, L.
Prescott, L.
Prosser, B.
Radice, L.
Ramsay of Cartvale, B.
Rendell of Babergh, B.
Richard, L.
Rooker, L.
Rosser, L.
Rowlands, L.
Royall of Blaisdon, B.
Sawyer, L.
Scotland of Asthal, B.
Sewel, L.
Sherlock, B.
Simon, V.
Smith of Basildon, B.
Smith of Finsbury, L.
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Smith of Leigh, L.
Soley, L.
Stair, E.
Stern, B.
Stevenson of Balmacara, L.
Stoddart of Swindon, L.
Stone of Blackheath, L.
Symons of Vernham Dean, B.
Taylor of Bolton, B.
Temple-Morris, L.
Thornton, B.
Tomlinson, L.
Touhig, L.
Tunnicliffe, L. [Teller]
Turnberg, L.
Turner of Camden, B.
Wall of New Barnet, B.
Wheeler, B.
Whitaker, B.
Whitty, L.
Wigley, L.
Wilkins, B.
Williams of Baglan, L.
Williams of Elvel, L.
Wills, L.
Wood of Anfield, L.
Woolmer of Leeds, L.
Worthington, B.
Young of Norwood Green, L.
Addington, L.
Adebowale, L.
Ahmad of Wimbledon, L.
Alderdice, L.
Anelay of St Johns, B. [Teller]
Astor, V.
Astor of Hever, L.
Attlee, E.
Avebury, L.
Baker of Dorking, L.
Barker, B.
Bates, L.
Bell, L.
Benjamin, B.
Berridge, B.
Best, L.
Bilimoria, L.
Black of Brentwood, L.
Blackwell, L.
Blencathra, L.
Bonham-Carter of Yarnbury, B.
Boswell of Aynho, L.
Bottomley of Nettlestone, B.
Bowness, L.
Bridgeman, V.
Brinton, B.
Brittan of Spennithorne, L.
Brooke of Sutton Mandeville, L.
Brougham and Vaux, L.
Browning, B.
Burnett, L.
Buscombe, B.
Butler-Sloss, B.
Byford, B.
Caithness, E.
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Cathcart, E.
Chester, Bp.
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Clement-Jones, L.
Colville of Culross, V.
Colwyn, L.
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Craigavon, V.
Crathorne, L.
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Dear, L.
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Dixon-Smith, L.
Dobbs, L.
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Eaton, B.
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Empey, L.
Erroll, E.
Exeter, Bp.
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Faulks, L.
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Fellowes, L.
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Fink, L.
Flight, L.
Fookes, B.
Forsyth of Drumlean, L.
Fowler, L.
Framlingham, L.
Fraser of Carmyllie, L.
Freeman, L.
Freud, L.
Garden of Frognal, B.
Gardiner of Kimble, L.
Gardner of Parkes, B.
German, L.
Glasgow, E.
Glendonbrook, L.
Glentoran, L.
Gold, L.
Goodhart, L.
Goodlad, L.
Goschen, V.
Greengross, B.
Greenway, L.
Hamwee, B.
Hanham, B.
Hannay of Chiswick, L.
Harries of Pentregarth, L.
Harris of Richmond, B.
Henley, L.
Higgins, L.
Hill of Oareford, L.
Hodgson of Astley Abbotts, L.
Home, E.
Hooper, B.
Howard of Rising, L.
Howarth of Breckland, B.
Howe, E.
Howell of Guildford, L.
Hunt of Wirral, L.
Hussain, L.
Hussein-Ece, B.
Inglewood, L.
James of Blackheath, L.
James of Holland Park, B.
Jenkin of Kennington, B.
Jenkin of Roding, L.
Jolly, B.
Jopling, L.
Kakkar, L.
Kilclooney, L.
King of Bridgwater, L.
Knight of Collingtree, B.
Kramer, B.
Laming, L.
Lamont of Lerwick, L.
Lang of Monkton, L.
Lawson of Blaby, L.
Lexden, L.
Lingfield, L.
Linklater of Butterstone, B.
Liverpool, E.
Loomba, L.
Luke, L.
Lytton, E.
MacGregor of Pulham Market, L.
McNally, L.
Maddock, B.
Magan of Castletown, L.
Maples, L.
Mar and Kellie, E.
Marks of Henley-on-Thames, L.
Marland, L.
Marlesford, L.
Masham of Ilton, B.
Mawhinney, L.
Mawson, L.
Mayhew of Twysden, L.
Methuen, L.
Miller of Chilthorne Domer, B.
Miller of Hendon, B.
Montgomery of Alamein, V.
Montrose, D.
Morris of Bolton, B.
Moynihan, L.
Murphy, B.
Naseby, L.
Neville-Jones, B.
Newby, L.
Newlove, B.
Newton of Braintree, L.
Nicholson of Winterbourne, B.
Northover, B.
Norton of Louth, L.
Oakeshott of Seagrove Bay, L.
O'Neill of Bengarve, B.
Oppenheim-Barnes, B.
Palmer, L.
Patel, L.
Patten, L.
Perry of Southwark, B.
Phillips of Sudbury, L.
Popat, L.
Powell of Bayswater, L.
Randerson, B.
Rawlings, B.
Razzall, L.
Reay, L.
Redesdale, L.
Rees-Mogg, L.
Renfrew of Kaimsthorn, L.
Rennard, L.
Renton of Mount Harry, L.
Ribeiro, L.
Risby, L.
6 Mar 2012 : Column 1719
Roberts of Llandudno, L.
Rodgers of Quarry Bank, L.
Rowe-Beddoe, L.
Saltoun of Abernethy, Ly.
Sanderson of Bowden, L.
Sassoon, L.
Scott of Foscote, L.
Scott of Needham Market, B.
Seccombe, B.
Selborne, E.
Selkirk of Douglas, L.
Selsdon, L.
Shackleton of Belgravia, B.
Sharkey, L.
Sharp of Guildford, B.
Sharples, B.
Shaw of Northstead, L.
Sheikh, L.
Shephard of Northwold, B.
Shipley, L.
Shutt of Greetland, L. [Teller]
Skelmersdale, L.
Smith of Clifton, L.
Soulsby of Swaffham Prior, L.
Spicer, L.
Stedman-Scott, B.
Stewartby, L.
Stoneham of Droxford, L.
Storey, L.
Stowell of Beeston, B.
Strathclyde, L.
Sutherland of Houndwood, L.
Taylor of Holbeach, L.
Teverson, L.
Thomas of Gresford, L.
Thomas of Winchester, B.
Tope, L.
Trefgarne, L.
Trenchard, V.
Trimble, L.
True, L.
Trumpington, B.
Tugendhat, L.
Tyler, L.
Tyler of Enfield, B.
Ullswater, V.
Verma, B.
Waddington, L.
Wade of Chorlton, L.
Wakeham, L.
Wallace of Saltaire, L.
Wallace of Tankerness, L.
Walmsley, B.
Walpole, L.
Walton of Detchant, L.
Warnock, B.
Warsi, B.
Wasserman, L.
Watson of Richmond, L.
Wheatcroft, B.
Wilcox, B.
Williamson of Horton, L.
Willis of Knaresborough, L.
Wolfson of Sunningdale, L.
Younger of Leckie, V.
6.33 pm
Amendment 163BC had been withdrawn from the Marshalled List.
163C:Schedule 8, page 368, line 17, after "functions" insert-
"(b) include a statement of what it did to comply with the duty under section (Secretary of State's guidance on duty under section 61(9))(2) (duty to have regard to Secretary of State's guidance on duty under section 61(9)), and
(c) include a statement of what it did to comply with the duty under section 64(1)(ja) (duty to have regard to Secretary of State's guidance on relevant parts of document on improving quality of services)."
Amendments 163D to 164 not moved.
165:Clause 61, page 88, line 5, at end insert-
"( ) Monitor must exercise its functions with a view to preventing anti-collaborative behaviour in the provision of health care services for the purposes of the NHS."
6 Mar 2012 : Column 1720
Baroness Finlay of Llandaff: In summing up after the previous debate, the Minister spoke about the service currently being fragmented and duplicative, and I would agree that it is. I am glad that the Government's intention is to have a service where healthcare providers collaborate more than they do at the moment. I accept that there will be a range of providers, and I support having a wide range of providers to provide a spectrum of services. However, I do not understand-and have not understood from the answers-why anti-collaborative behaviour should not be up there as a general duty for Monitor with anti-competitive behaviour. Because of that, and because of all the discussion that we have had over integration and collaboration, I feel that it is a duty that I have to those who wish to collaborate in the NHS to test the opinion of the House, so that there is equal status between anti-competitive and anti-collaborative behaviour in the event of there being a conflict between the two.
Earl Howe: I hoped that I had already made it clear to the noble Baroness that collaborative behaviour when it is in the interests of the patients-and I distinguish that from collusive behaviour, which is almost certainly not in the interests of patients-will be regarded by Monitor as trumping the need for competition to be deployed in services. I am not sure that I understand what the noble Baroness's problem is in this area; she should be reassured by that.
Baroness Finlay of Llandaff: I am grateful to the Minister for trying to clarify these matters, but my concern relates to anti-competitive and anti-collaborative being of at least equal status. I would prefer anti-collaborative to be on the face of the Bill. Is the Minister prepared to have a discussion with me after this debate to see whether we could insert some other wording to prevent both anti-collaborative and anti-competitive behaviour? In that way, even when a provider states that it intends to collaborate and that is put down clearly, if it is demonstrated as time goes on that the provider is not fulfilling that, Monitor will have the leverage to say that it was in open competition but the provider has not fulfilled the requirement to collaborate.
Earl Howe: I am of course willing to hold discussions with the noble Baroness, but I remind her that we have explicitly provided for Monitor to use its licensing powers to support integration and co-operation when that is in the interests of patients. We were fully aware of that issue when drafting the Bill. Later amendments, which we will debate today, will strengthen the ability of Monitor even further.
Baroness Finlay of Llandaff: I recognise that they will strengthen Monitor further and that they will come later, but my disappointment is that they are not in the core general duties that will override the way in which Monitor functions. They will come later on and in detail, and I can see that in the amendments that the Government have tabled. But my concern persists, and I wish to test the opinion of the House.
6 Mar 2012 : Column 1721
6.38 pm
Contents 171; Not-Contents 221.
Adams of Craigielea, B.
Adonis, L.
Ahmed, L.
Alton of Liverpool, L.
Anderson of Swansea, L.
Andrews, B.
Armstrong of Hill Top, B.
Bach, L.
Bakewell, B.
Bassam of Brighton, L.
Beecham, L.
Berkeley, L.
Bhattacharyya, L.
Bilston, L.
Blackstone, B.
Blood, B.
Boateng, L.
Borrie, L.
Bradley, L.
Bragg, L.
Brennan, L.
Brooke of Alverthorpe, L.
Brookman, L.
Browne of Belmont, L.
Chester, Bp.
Clark of Windermere, L.
Clinton-Davis, L.
Cohen of Pimlico, B.
Collins of Highbury, L.
Corston, B.
Cunningham of Felling, L.
Davidson of Glen Clova, L.
Davies of Oldham, L.
Dean of Thornton-le-Fylde, B.
Donaghy, B.
Donoughue, L.
Drake, B.
Drayson, L.
Dubs, L.
Eatwell, L.
Evans of Parkside, L.
Evans of Temple Guiting, L.
Evans of Watford, L.
Farrington of Ribbleton, B.
Faulkner of Worcester, L.
Filkin, L.
Finlay of Llandaff, B. [Teller]
Foster of Bishop Auckland, L.
Foulkes of Cumnock, L.
Gale, B.
Giddens, L.
Gilbert, L.
Glasman, L.
Golding, B.
Gordon of Strathblane, L.
Goudie, B.
Gould of Potternewton, B.
Grantchester, L.
Grenfell, L.
Grocott, L.
Hameed, L.
Hanworth, V.
Harris of Haringey, L.
Harrison, L.
Hart of Chilton, L.
Haskel, L.
Haworth, L.
Hayter of Kentish Town, B.
Healy of Primrose Hill, B.
Henig, B.
Hennessy of Nympsfield, L. [Teller]
Hollins, B.
Hollis of Heigham, B.
Howarth of Newport, L.
Howells of St Davids, B.
Hoyle, L.
Hughes of Stretford, B.
Hughes of Woodside, L.
Hunt of Kings Heath, L.
Jay of Paddington, B.
Joffe, L.
Jones, L.
Jones of Whitchurch, B.
Judd, L.
Kennedy of Southwark, L.
Kennedy of The Shaws, B.
King of Bow, B.
King of West Bromwich, L.
Kinnock, L.
Kinnock of Holyhead, B.
Kirkhill, L.
Knight of Weymouth, L.
Lea of Crondall, L.
Liddell of Coatdyke, B.
Liddle, L.
Lipsey, L.
Low of Dalston, L.
McAvoy, L.
McDonagh, B.
Macdonald of Tradeston, L.
McIntosh of Hudnall, B.
MacKenzie of Culkein, L.
Mackenzie of Framwellgate, L.
McKenzie of Luton, L.
Mallalieu, B.
Martin of Springburn, L.
Masham of Ilton, B.
Massey of Darwen, B.
Maxton, L.
Mitchell, L.
Monks, L.
Montgomery of Alamein, V.
Morgan of Ely, B.
Morgan of Huyton, B.
Morris of Aberavon, L.
Morris of Handsworth, L.
Myners, L.
Nye, B.
O'Neill of Clackmannan, L.
Owen, L.
Patel of Blackburn, L.
Patel of Bradford, L.
Pendry, L.
Pitkeathley, B.
Plant of Highfield, L.
Prescott, L.
Prosser, B.
6 Mar 2012 : Column 1722
Ramsay of Cartvale, B.
Rea, L.
Rendell of Babergh, B.
Richard, L.
Rooker, L.
Rosser, L.
Rowlands, L.
Royall of Blaisdon, B.
Sawyer, L.
Scotland of Asthal, B.
Sewel, L.
Sherlock, B.
Simon, V.
Smith of Basildon, B.
Smith of Finsbury, L.
Smith of Gilmorehill, B.
Smith of Leigh, L.
Stone of Blackheath, L.
Symons of Vernham Dean, B.
Taylor of Bolton, B.
Temple-Morris, L.
Thornton, B.
Tomlinson, L.
Tonge, B.
Touhig, L.
Tunnicliffe, L.
Turnberg, L.
Turner of Camden, B.
Wall of New Barnet, B.
Walpole, L.
Wheeler, B.
Whitaker, B.
Whitty, L.
Wigley, L.
Wilkins, B.
Williams of Baglan, L.
Williams of Elvel, L.
Williamson of Horton, L.
Wills, L.
Wood of Anfield, L.
Woolmer of Leeds, L.
Worthington, B.
Young of Norwood Green, L.
Addington, L.
Ahmad of Wimbledon, L.
Alderdice, L.
Anelay of St Johns, B. [Teller]
Astor, V.
Astor of Hever, L.
Attlee, E.
Baker of Dorking, L.
Barker, B.
Bates, L.
Bell, L.
Benjamin, B.
Berridge, B.
Bew, L.
Black of Brentwood, L.
Blackwell, L.
Blencathra, L.
Bonham-Carter of Yarnbury, B.
Boswell of Aynho, L.
Bottomley of Nettlestone, B.
Bowness, L.
Bridgeman, V.
Brinton, B.
Brittan of Spennithorne, L.
Brooke of Sutton Mandeville, L.
Brougham and Vaux, L.
Browning, B.
Burnett, L.
Buscombe, B.
Butler-Sloss, B.
Byford, B.
Caithness, E.
Carlile of Berriew, L.
Cathcart, E.
Clement-Jones, L.
Colwyn, L.
Cope of Berkeley, L.
Cormack, L.
Cotter, L.
Courtown, E.
Craigavon, V.
Crathorne, L.
Crickhowell, L.
Cumberlege, B.
Dannatt, L.
De Mauley, L.
Dear, L.
Deben, L.
Denham, L.
Dholakia, L.
Dixon-Smith, L.
Dobbs, L.
Doocey, B.
Dykes, L.
Eaton, B.
Eccles, V.
Edmiston, L.
Elton, L.
Empey, L.
Exeter, Bp.
Falkner of Margravine, B.
Faulks, L.
Feldman of Elstree, L.
Fellowes of West Stafford, L.
Fink, L.
Flight, L.
Fookes, B.
Forsyth of Drumlean, L.
Fowler, L.
Framlingham, L.
Freeman, L.
Freud, L.
Garden of Frognal, B.
Gardiner of Kimble, L.
Gardner of Parkes, B.
German, L.
Glasgow, E.
Glendonbrook, L.
Glentoran, L.
Gold, L.
Goodhart, L.
Goodlad, L.
Goschen, V.
Greenway, L.
Hamilton of Epsom, L.
Hamwee, B.
Hanham, B.
Harris of Richmond, B.
Henley, L.
Higgins, L.
Hill of Oareford, L.
Hodgson of Astley Abbotts, L.
Home, E.
Hooper, B.
Howard of Rising, L.
Howarth of Breckland, B.
Howe, E.
Howe of Idlicote, B.
Howell of Guildford, L.
Hunt of Wirral, L.
Hussain, L.
Hussein-Ece, B.
James of Blackheath, L.
6 Mar 2012 : Column 1723
Jenkin of Kennington, B.
Jenkin of Roding, L.
Jolly, B.
Jopling, L.
Kakkar, L.
Kilclooney, L.
King of Bridgwater, L.
Knight of Collingtree, B.
Kramer, B.
Laming, L.
Lamont of Lerwick, L.
Lang of Monkton, L.
Lawson of Blaby, L.
Lexden, L.
Lingfield, L.
Linklater of Butterstone, B.
Liverpool, E.
Loomba, L.
Luke, L.
Lytton, E.
Maclennan of Rogart, L.
Maddock, B.
Magan of Castletown, L.
Maples, L.
Marks of Henley-on-Thames, L.
Marland, L.
Marlesford, L.
Mawhinney, L.
Mawson, L.
Mayhew of Twysden, L.
Meacher, B.
Methuen, L.
Miller of Chilthorne Domer, B.
Miller of Hendon, B.
Morris of Bolton, B.
Moynihan, L.
Murphy, B.
Naseby, L.
Neville-Jones, B.
Newby, L.
Newlove, B.
Newton of Braintree, L.
Nicholson of Winterbourne, B.
Northover, B.
Norton of Louth, L.
Oakeshott of Seagrove Bay, L.
O'Neill of Bengarve, B.
Oppenheim-Barnes, B.
Patel, L.
Patten, L.
Perry of Southwark, B.
Popat, L.
Randerson, B.
Rawlings, B.
Razzall, L.
Redesdale, L.
Renfrew of Kaimsthorn, L.
Rennard, L.
Renton of Mount Harry, L.
Ribeiro, L.
Risby, L.
Roberts of Conwy, L.
Roberts of Llandudno, L.
Saltoun of Abernethy, Ly.
Sassoon, L.
Scott of Foscote, L.
Scott of Needham Market, B.
Seccombe, B.
Selborne, E.
Selkirk of Douglas, L.
Selsdon, L.
Shackleton of Belgravia, B.
Sharkey, L.
Sharp of Guildford, B.
Sharples, B.
Shaw of Northstead, L.
Sheikh, L.
Shephard of Northwold, B.
Shipley, L.
Shutt of Greetland, L. [Teller]
Skelmersdale, L.
Smith of Clifton, L.
Spicer, L.
Stair, E.
Stedman-Scott, B.
Stewartby, L.
Stoneham of Droxford, L.
Storey, L.
Stowell of Beeston, B.
Strathclyde, L.
Sutherland of Houndwood, L.
Taylor of Holbeach, L.
Teverson, L.
Thomas of Winchester, B.
Tope, L.
Trefgarne, L.
Trenchard, V.
Trimble, L.
True, L.
Tugendhat, L.
Tyler, L.
Tyler of Enfield, B.
Ullswater, V.
Verma, B.
Waddington, L.
Wakeham, L.
Wallace of Saltaire, L.
Wallace of Tankerness, L.
Walmsley, B.
Warsi, B.
Wasserman, L.
Watson of Richmond, L.
Wheatcroft, B.
Wilcox, B.
Willis of Knaresborough, L.
Wolfson of Sunningdale, L.
Younger of Leckie, V.
6.51 pm
Amendments 166 and 166A not moved.
166B:After Clause 61, insert the following new Clause-
"Secretary of State's guidance on duty under section 61(9)
(1) The Secretary of State may, for the purpose of assisting Monitor to comply with its duty under section 61(9), publish guidance on-
6 Mar 2012 : Column 1724
(a) the objectives specified in the mandate published under section 13A of the National Health Service Act 2006 which the Secretary of State considers to be relevant to Monitor's exercise of its functions, and
(b) the Secretary of State's reasons for considering those objectives to be relevant to Monitor's exercise of its functions.
(2) In exercising its functions, Monitor must have regard to guidance under subsection (1).
(3) Where the Secretary of State publishes guidance under subsection (1), the Secretary of State must lay a copy of the published guidance before Parliament.
(a) may revise guidance under subsection (1), and
(b) if the Secretary of State does so, must publish the guidance as revised and lay it before Parliament."
Clause 62 : General duties: supplementary
Clause 63 : Power to give Monitor functions relating to adult social care services
167A:Clause 63, page 89, line 34, at end insert-
"( ) Regulations may provide for Monitor to make the granting of a licence conditional upon performance in relation to matters set out as in section 64."
Baroness Finlay of Llandaff: My Lords, some of the amendments in this group are in my name and that of the noble Lord, Lord Northbourne, who is unable to be in the House today because of ill health. They relate to the transition of care between different sectors and build around the principle of integrated working.
The problem that arises is that the responsibility for care of children will sit with different groups. There is a need to make sure that, when children make the transition from being the responsibility of social services to being the responsibility of the local authority and, in adult care, of the clinical commissioning groups, there is adequate provision for how that handover occurs. A clear date for it should be set and it should make explicit the duties for each party involved in handing on information. Without that, there is a concern that as these young people-many of whom will have mixed mental, physical and social care needs-transition across, information about those needs may not adequately pass from one agency to another. There is a concern that they may fall into a gap and that the responsibility at the time of transition will not be clear. We are also concerned that, without a clear, fixed date for the transition with a default time set in legislation, it will be easy for a young person's care to drop out of sight, particularly if they are not supported by people well able to advocate on their behalf.
6 Mar 2012 : Column 1725
Also in this group is Amendment 174A, which concerns the general duties of Monitor and is in the name of the noble Baroness, Lady Young of Old Scone. She has asked me to speak to this amendment, which again emphasises the importance of integration of services. Her concern is about diabetes but goes far wider than that. Where there is a multiplicity of providers, how they work together will depend on how Monitor specifies service in the national tariff. Since patients with complex conditions require input from many different providers, there is a concern that, without a real emphasis in the Bill on provision being integrated, they may end up being told that their care is not the responsibility of one person or another. These amendments, which have been grouped together, seek clarity on the seamless provision of care. The principle behind them is to address those gaps that we have identified in that seamless provision of care.
I return to the amendments in my name and that of the noble Lord, Lord Northbourne. We are well aware that it can be very difficult to differentiate between the social and mental health needs of young people. For that reason, we feel that it is important that transition is clarified. I beg to move.
Lord Beecham: My Lords, we certainly support these amendments. I am particularly pleased by the reference in Amendment 171A to the transfer of information between child and adult social care authorities, which picks up a point that was raised in an earlier debate. These are sensible amendments, although there is an error in Amendment 238G, which refers to health and welfare boards, instead of health and well-being boards. On that not untypically pedantic note, I support the amendments and trust that the Minister will give them a favourable response.
Baroness Northover: My Lords, there is a clear consensus on the importance of further integration and more services being joined up around patients' needs. The Bill seeks to encourage and enable the delivery of integrated services and contains strong provisions to ensure that this takes place. We are placing a duty of integration on all bodies, including clinical commissioning groups and health and well-being boards, to ensure more joined-up provision of services for patients, social care service users and carers. Furthermore, all NHS bodies and private and third sector providers supplying NHS services are required by the Health Act 2009 to take account of the NHS constitution in their decisions and actions. This includes the principle that the NHS works across organisational boundaries and in partnership with other organisations in the interests of patients, local communities and the wider population.
The Bill takes this further by making it clear that, in exercising any of their functions, commissioners must act with a view to securing that services are provided in a way that promotes the NHS constitution; and with a view to securing continuous improvement in outcomes, including effectiveness, safety and quality of patient experience. Commissioners must also exercise their functions with a view to securing that health services are provided in an integrated way where this
6 Mar 2012 : Column 1726
7 pm
As we have heard, the job of Monitor is to protect and promote patients' interests. This will be the guiding principle for Monitor in resolving potential conflicts. However, hugely important as enabling integration is, it is a means to those ends, and we are not convinced that it should supersede all other considerations.
In respect of Amendment 174A, to which the noble Baroness, Lady Finlay, has spoken on behalf of the noble Baroness, Lady Young, we feel that the list at Clause 65(5) must relate to Monitor's functions and the impact on its overarching duty. The noble Baroness, Lady Finlay, is absolutely right that decisions on the use of competition should take account of the potential impact on integration where this is needed to improve outcomes for patients, and the noble Baroness, Lady Young, has emphasised the need for this as regards diabetes and other conditions. The Bill would place that responsibility on commissioners while ensuring that they act transparently and can justify their decisions in the best interests of the patients.
The amendments in the names of the noble Lord, Lord Northbourne, and the noble Baroness, Lady Finlay, to which the noble Baroness has spoken, raise the wider issue of young people's transition between different services, including to adult services. We agree that all transitions should be managed as effectively as possible, and this is a vital area in which to get integration right. The noble Baroness, Lady Finlay, is absolutely right about that. I am sure that your Lordships are aware that Sir Ian Kennedy's review of children's services highlighted problems in handling the transition from children's to adult care, especially in mental health and services for disabled children. We strongly believe that there is a real opportunity to support young people moving through key transition points and into adult care. There are a range of interlocking policies which we believe will result in more integrated and personalised care for children. I hope that I may explain some of the stages involved in this.
Earlier I said that the Bill places integration duties on all bodies. I should have said integration duties across the NHS.
Health and well-being boards will have a vital role as regards the stages in children's care. The joint strategic needs assessments and joint health and well-being strategies drawn up by the local health and well-being board will ensure that local commissioners consider the needs of young people as they move into adulthood. The boards will bring together the key agencies when assessing, planning and commissioning local services. For example, in relation to children and young people, each health and well-being board will have the local director of children's services as a statutory member
6 Mar 2012 : Column 1727
Your Lordships may also be aware that the Secretary of State has commissioned the development of a children and young people's health outcomes strategy. This strategy will seek to set out the outcomes that matter most to children and young people, and will describe the contribution that the different parts of the system need to make to support their successful implementation. The strategy is being informed through a children and young people's forum, which brings together a wide range of people with a record of expertise and commitment to improving healthcare provision for children and young people. Children and young people, including those with special educational needs and disability, will be asked their views on the outcomes that matter most to them. The transition to adult services has been identified as a key theme that will have a special focus within the strategy's development. The forum will report back to the Secretary of State with its recommendations in the summer.
Work is also under way to explore how to develop integration in practice. As part of the special educational needs Green Paper Support and Aspiration, published in March 2011, the Department for Education together with the Department of Health has appointed 20 pathfinder areas covering 31 local authorities, PCT clusters and emerging CCGs to test different ways of improving care for children and young people in this category. Critically, this includes a single assessment process and plan for education, health and care needs from birth up to the age of 25 for children and young people with a disability or special educational need. All the pathfinders will address transition and how children's and young people's needs and support can be joined together across all services. This will, of course, include the transition from children's to adult social care. The learning from the pathfinder programme will be applied across all local areas as quickly as possible.
In earlier debates we discussed the social care White Paper. That will address integration and the reaction to that will be coming forward. I understand and accept entirely the spirit of these amendments but I hope that I have demonstrated our commitment to integration. I am entirely certain that our existing proposals and wider programme of work already address the underlying objective of these amendments. I hope I have reassured noble Lords and that they will feel able to withdraw their amendments.
Baroness Finlay of Llandaff: I am most grateful to the noble Baroness for the assurances that she has given. I am particularly grateful to her for focusing on
6 Mar 2012 : Column 1728
Clause 64 : Matters to have regard to in exercise of functions
168: Clause 64, page 90, leave out line 2 and insert-
"(1) In exercising its functions, Monitor must have regard, in particular, to-"
169: Clause 64, page 90, line 3, at end insert-
"(2) Monitor must, in exercising its functions, also have regard to the following matters in so far as they are consistent with the matter referred to in subsection (1)-"
173A: Clause 64, page 90, line 27, at end insert-
"(ja) where the Secretary of State publishes a document for the purposes of section 13E of the National Health Service Act 2006 (improvement of quality of services), any guidance published by the Secretary of State on the parts of that document which the Secretary of State considers to be particularly relevant to Monitor's exercise of its functions,"
173C: Clause 64, page 90, line 36, at end insert-
"( ) Where the Secretary of State publishes guidance referred to in subsection (2)(ja), the Secretary of State must lay a copy of the published guidance before Parliament.
(a) may revise the guidance, and
(b) if the Secretary of State does so, must publish the guidance as revised and lay it before Parliament."
Amendments 173A to 173C agreed.
6 Mar 2012 : Column 1729
Clause 65 : Conflicts between functions
Amendment 174ZA had been withdrawn from the Marshalled List.
Clause 69 : Failure to perform functions
175:Clause 69, page 93, line 38, after "Monitor's" insert ", other than a function it has by virtue of section 70 or 71,"
176:Clause 69, page 94, leave out lines 8 and 9 and insert-
"( ) For the purposes of this section-
(a) a failure to perform a function includes a failure to perform it properly, and
(b) a failure to perform a function properly includes a failure to perform it consistently with what the Secretary of State considers to be the interests of the health service in England or (as the case may be) with what otherwise appears to the Secretary of State to be the purpose for which it is conferred; and "the health service" has the same meaning as in the National Health Service Act 2006."
Amendments 175 and 176 agreed.
Amendment 177 and 178 not moved.
Clause 73 : Requirements as to procurement, patient choice and competition
178A:Clause 73, page 96, line 30, at end insert-
"(5) An NHS commissioner shall be entitled to undertake a review ("a Commissioning Review") of all or any part of the health services that the NHS commissioner considers are reasonably required in order to discharge its functions under this Act, and, upon completion of such a Commissioning Review, an NHS Commissioner shall be entitled to determine that the most appropriate way to deliver all or any part of such services shall be through the conclusion of arrangements with one or more health services bodies or one or more NHS Foundation Trusts.
(6) NHS Commissioners shall, when conducting a Commissioning Review, have regard to the following factors-
(a) the need for NHS services to be provided in a way that is economic, efficient and effective;
(b) the need to commission services in a way that maintains or improves the quality of the services;
(c) the need to commission health services in a way that promotes the integration of health and social care services;
(d) the need for health care services provided for the purposes of the NHS to be provided in an integrated way where this will-
(i) improve the quality of those services (including the outcomes that are achieved from their provision) or the efficiency of their provision,
6 Mar 2012 : Column 1730
(ii) reduce inequalities between persons with respect to their ability to access those services, and
(iii) reduce inequalities between persons with respect to the outcomes achieved for them by the provision of those services;
(e) the likely future demand for health care services;
(f) the desirability of patient choice.
(7) An NHS commissioner shall be entitled, as part of any Commissioning Review, to seek expressions of interest from health services bodies or from NHS Foundation Trusts which may have an interest in providing such services, and shall be entitled to undertake such processes as it shall consider appropriate to determine which of such bodies is able most appropriately to provide any such services.
(8) A Commissioning Review and decisions made following a Commissioning Review to make arrangements with one or more health services bodies or NHS Foundation Trusts shall not constitute anti-competitive behaviour for the purposes of this or any other Act.
(9) The Public Contracts Regulations 2006 shall not impose any obligations on an NHS commissioner which undertakes a Commissioning Review or makes decisions to make arrangements with one or more health services bodies or NHS Foundation Trusts following a Commissioning Review.
(10) Regulations under this section shall not impose obligations on an NHS commissioner undertaking a Commissioning Review.
(11) The NHS Commissioning Board may, after consultation with Monitor, publish guidance to NHS Commissioners concerning Commissioning Reviews.
(12) The National Health Service Act 2006 shall be amended by adding the following after section 9(4)(r)-
"(s) An NHS Foundation Trust"."
Baroness Thornton: I beg to move.
7.09 pm
Contents 157; Not-Contents 203.
Adams of Craigielea, B.
Adonis, L.
Ahmed, L.
Alli, L.
Alton of Liverpool, L.
Anderson of Swansea, L.
Andrews, B.
Bach, L.
Bakewell, B.
Bassam of Brighton, L. [Teller]
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Bhattacharyya, L.
Bilston, L.
Blackstone, B.
Blood, B.
Boateng, L.
Borrie, L.
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Bradley, L.
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Drake, B.
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Evans of Temple Guiting, L.
Evans of Watford, L.
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Faulkner of Worcester, L.
6 Mar 2012 : Column 1731
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Hennessy of Nympsfield, L.
Hollins, B.
Howarth of Newport, L.
Hughes of Stretford, B.
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Hunt of Kings Heath, L.
Hylton, L.
Jay of Paddington, B.
Jones, L.
Jones of Whitchurch, B.
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Kennedy of Southwark, L.
Kennedy of The Shaws, B.
King of West Bromwich, L.
Kinnock, L.
Kinnock of Holyhead, B.
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Knight of Weymouth, L.
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Liddle, L.
Lipsey, L.
McAvoy, L.
McDonagh, B.
Macdonald of Tradeston, L.
McFall of Alcluith, L.
McIntosh of Hudnall, B.
MacKenzie of Culkein, L.
Mackenzie of Framwellgate, L.
McKenzie of Luton, L.
Mallalieu, B.
Martin of Springburn, L.
Masham of Ilton, B.
Massey of Darwen, B.
Maxton, L.
Mitchell, L.
Monks, L.
Montgomery of Alamein, V.
Morgan of Ely, B.
Morris of Handsworth, L.
Myners, L.
Nye, B.
O'Neill of Clackmannan, L.
Owen, L.
Patel of Blackburn, L.
Pitkeathley, B.
Plant of Highfield, L.
Prescott, L.
Prosser, B.
Ramsay of Cartvale, B.
Rea, L.
Reid of Cardowan, L.
Rendell of Babergh, B.
Richard, L.
Rooker, L.
Rosser, L.
Royall of Blaisdon, B.
Sawyer, L.
Scotland of Asthal, B.
Sewel, L.
Sherlock, B.
Simon, V.
Smith of Basildon, B.
Smith of Finsbury, L.
Smith of Leigh, L.
Soley, L.
Stevenson of Balmacara, L.
Stoddart of Swindon, L.
Stone of Blackheath, L.
Symons of Vernham Dean, B.
Taylor of Bolton, B.
Temple-Morris, L.
Thornton, B.
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Touhig, L.
Tunnicliffe, L. [Teller]
Turnberg, L.
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Wheeler, B.
Whitaker, B.
Whitty, L.
Wigley, L.
Wilkins, B.
Williams of Baglan, L.
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Astor, V.
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Bell, L.
Benjamin, B.
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Bridgeman, V.
Brinton, B.
Brittan of Spennithorne, L.
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Brougham and Vaux, L.
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Cathcart, E.
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6 Mar 2012 : Column 1732
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Forsyth of Drumlean, L.
Fowler, L.
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Garden of Frognal, B.
Gardiner of Kimble, L.
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Hamilton of Epsom, L.
Hamwee, B.
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Howell of Guildford, L.
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Kramer, B.
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Lingfield, L.
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Wade of Chorlton, L.
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Williams of Crosby, B.
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7.22 pm
180:Clause 76, page 98, line 32, at end insert-
"( ) Before publishing guidance revised under subsection (4), Monitor must consult the persons mentioned in subsection (2)."
Amendments 179 and 180 agreed.
Clause 77: Mergers involving NHS foundation trusts
181:Clause 77, page 98, line 34, leave out subsection (1) and insert-
"( ) For the purposes of Part 3 of the Enterprise Act 2002 (completed and anticipated mergers), each of the following cases is to be treated as being (in so far as it would not otherwise be) a case in which two or more enterprises cease to be distinct enterprises."
Earl Howe: My Lords, I speak also to Amendments 182 and 183. There is one simple point to Clause 77: it is there to remove the current legal uncertainty and risk of double jeopardy for foundation trusts under the UK's existing general merger controls. The OFT already has jurisdiction to review foundation trust mergers under the Enterprise Act, but there is legal uncertainty as to when that applies in individual cases. That creates the risk of double jeopardy for foundation trusts under current arrangements, as their mergers are also reviewed by the Co-operation and Competition Panel. Amendments 181 to 183 are minor and technical amendments which make it clear that Clause 77 applies to both completed and anticipated mergers. I will reserve my remarks on the other amendments in the group until I have heard the contributions of the noble Lords who are proposing them. Meanwhile, I beg to move.
Lord Clement-Jones: My Lords, I shall speak to Amendment 184. In Committee, we debated the role of the OFT in merger policy and looking into mergers between foundation trusts. I tabled an amendment because it seemed to me at the time that the Enterprise Act was a relatively blunt instrument for the OFT to use to look at those mergers, compared to the usual way that it would look at the competitive effect or impact on competition of such a merger. The response of the noble Earl, Lord Howe, was extremely helpful in guiding us through the relevant provisions of the
6 Mar 2012 : Column 1734
The issue is that "customer" is not normally how we describe patients in the NHS and the way that the NHS operates is rather different from considering whether Dixons taking over Comet, for instance, will impact on the customer or the consumer. There is a difference. It seemed to me that the best way to handle the matter would be specifically to provide for Monitor to be inserted into the process so that it would give specific advice to the OFT on those matters. Although the definition is "relevant customer benefits", its perspective would be on the impact on patients.
I appreciate the earlier amendments which the noble Earl has tabled, but this would add the extra dimension to Clause 77 which will enable the OFT and Monitor to have a really powerful role in the way that they oversee foundation trust mergers and, I think, settle some of the concerns which surround Clause 77 as drafted.
Lord Beecham: My Lords, the amendments are a good example of the thickets and undergrowth of the elaborate structures to deal with competition generally in the economy into which the health service is being drawn. I have no doubt that the noble Earl is right in describing the amendments as technical; the amendment of the noble Lord, Lord Clement-Jones, is also technical. It is not the worse for that, but this whole area ought to be removed from the Bill. Our Amendment 184A would remove Clause 77 altogether. Our view is that that elaborate machinery and the use of the Office of Fair Trading is not appropriate for mergers of foundation trusts. Having said that, we do not intend to divide the House; we simply deplore the fact that this machinery, somewhat refined by the amendments, is being cranked up to apply unnecessarily.
Earl Howe: My Lords, as I said earlier, retaining Clause 77 would have several substantial benefits. The OFT already has jurisdiction to review foundation trust mergers under the Enterprise Act. The problem, as I said, is that there is legal uncertainty as to when that applies in individual cases. That creates the risk of double jeopardy for foundation trusts, as their mergers are also reviewed by the Co-operation and Competition Panel. There is also a problem of unnecessary duplication of specialist skills between the Co-operation and Competition Panel and the OFT which, incidentally, brings with it a cost to the UK taxpayer.
Retaining Clause 77 would avoid that duplication and eliminate the current legal uncertainty and risk of double jeopardy for foundation trusts. That would encompass mergers between two or more foundation trusts and acquisitions by a foundation trust of another foundation trust or a private business, such as UCLH's acquisition of the London Heart Hospital under the previous Administration.
However, it is important for me to make it clear that the Bill would prevent any takeover of a foundation trust by a private company, contrary to what some commentators outside this House have suggested. Secondly, the OFT has a proven track record for light-touch, proportionate regulation of mergers and ensuring good value for public money. By contrast, under
6 Mar 2012 : Column 1735
Finally, the approach provides better value for public money by avoiding duplication of specialist resources between the OFT and Monitor. Mergers are a specialist area. Given the variable frequency of mergers in the NHS, it would be a far better use of resources to consolidate the responsibility and expertise within the OFT, where they could also be put to good work for the benefit of the wider economy, rather than resourcing another public body at the taxpayer's expense.
7.30 pm
I reassure the House that the paramount consideration for the OFT in reviewing foundation trust mergers would be the impact on patients' interests. This would include, as a matter of necessity, considering the interests of patients in securing sustainable access to a comprehensive health service.
As part of any merger investigation, the OFT and the Competition Commission would engage with Monitor in order better to understand the services involved. In particular, the OFT would obtain Monitor's view on how a merger would benefit patients. These views would then be considered in the analysis, along with representations from other stakeholders, including local health and well-being boards, and other evidence. However, I sympathise with concerns to ensure Monitor's involvement in advising the OFT and with the desire that this should be included in the Bill.
Amendment 184, proposed by my noble friend Lord Clement-Jones, would ensure that evidence gathered in reviewing a merger involving a foundation trust would always include expert advice from a healthcare regulator with an overriding duty to protect and promote patients' interests. I thank my noble friend for what I think is an elegant solution and I hope that it will allay any concerns that remain in the House in this area. I am pleased to tell him that I plan to support Amendment 184, as and when he comes to move it. I hope that, in the light of those reassurances, the noble Lord, Lord Beecham, will feel able not to move his amendment.
Amendments 182 and 183 agreed.
184: Clause 77, page 98, line 40, at end insert-
"(3A) Where the Office of Fair Trading decides to carry out an investigation under Part 3 of the Enterprise Act 2002 of a matter involving an NHS foundation trust, it must as soon as reasonably practicable notify Monitor.
6 Mar 2012 : Column 1736
(3B) As soon as reasonably practicable after receiving a notification under subsection (3A), Monitor must provide the Office of Fair Trading with advice on-
(a) the effect of the matter under investigation on benefits (in the form of those within section 30(1)(a) of the Enterprise Act 2002 (relevant customer benefits)) for people who use health care services provided for the purpose of the NHS, and
(b) such other matters relating to the matter under investigation as Monitor considers appropriate."
Clause 78 : Reviews by the Competition Commission
185: Clause 78, page 99, line 5, leave out paragraph (a) and insert-
"(a) the effectiveness of competition in the provision of health care services for the purposes of the NHS in promoting the interests of people who use such services,"
Earl Howe: My Lords, perhaps I may begin by clarifying the role of the Competition Commission as set out in the Bill because I think that there have been a few misconceptions about this. The commission would not enforce the Competition Act in relation to healthcare services, nor would the commission's role affect the applicability of competition law to the NHS, and the Bill would not give the Competition Commission direct powers over providers of NHS services.
Instead, the Bill would give the Competition Commission two narrow, specific roles in relation to NHS services. First, the commission would be the independent adjudicator where sufficient providers or, in some cases, commissioners objected to Monitor's proposals for licence modifications or its methodologies to be used to calculate prices or levies for providers to ensure the continuity of essential services.
Secondly, the Bill currently provides that the commission would undertake reviews of the development of competition in the provision of NHS services and the way that Monitor was fulfilling its functions relating to the provision of such services. Where it concluded that something was or could be averse to the public interest, it could make non-binding recommendations to the Secretary of State, Monitor or the NHS Commissioning Board.
I am aware of a concern that this wording could imply that the review should focus the development of competition as an end in itself. That is absolutely not our intention. That is why commissioners will decide when competition and choice will be used, and indeed whether it will be used, as a means of improving services and enabling patients to have control of their care. To make that clear, we have tabled Amendment 185, which provides that the reviews relate to the effectiveness of competition in realising benefits for NHS patients, rather than the development of competition per se. I hope that noble Lords will agree that this wording provides clarity about the purpose of the reviews and
6 Mar 2012 : Column 1737
Lord Clement-Jones: My Lords, it would seem convenient, although it alters the groupings, to talk to my Amendments 186, 187 and 188 at this point.
In Committee-and I am very grateful to the noble Lords, Lord Turnberg and Lord Patel, for supporting these amendments-we flagged our general concern about the risks of EU competition law being applied across the board in the health service. One risk that we considered to be high was the involvement to such a great extent in the Bill of the Competition Commission and, in particular, its role in Clauses 78, 79 and 80, as well as its role in reviewing competition within the health service and the development of competition by Monitor.
On these Benches, we, along with Future Forum and following legal advice, believe that it is necessary and consistent to delete Clause 78, which provides for a review of the exercise of Monitor's functions and, as I said, the development of competition in the NHS. Government Amendment 185 would of course change this to a review of the effectiveness of competition in the NHS in promoting the interests of those who use the NHS. Nevertheless, we have considerable concerns about the involvement of the Competition Commission. The commission occasionally has to apply non-commission principles in its investigations. It may need to consider, for example, whether media plurality would be undermined by a media merger. However, the commission members and staff are steeped in competition law principles and it is difficult to get them to attribute equal weight to non-competition objectives. The experience of those involved with the commission is that it tends to focus far more on the competition analysis and is often reluctant to accept that it might be required to endorse an outcome that may be suboptimal from a competition perspective in order better to promote other objectives.
Judgments about whether competition or co-operation best promote certain objectives, including health sector objectives, are not clear-cut. Which side of the line people come down on will depend on their standpoints and assumptions about the extent to which competition is helpful in general, as well as on their experience. Regular commission members tend to have a strong bias in favour of the benefits of competition, and that strengthens our view on the inappropriateness of the reviews by the Competition Commission. It is not necessary for there to be a review of this kind either of the NHS or of the operation of Monitor. Indeed, I would argue that its very presence in reviewing both the NHS and Monitor increases the risk of competition law applying more widely.
Following the Future Forum's report, the purpose of Monitor is no longer primarily to promote competition. Clearly there is now explicit recognition of the overriding importance of the benefits to patients. This is the key determinant of which instrument-competition or integration-is appropriate in the operation of the health service.
6 Mar 2012 : Column 1738
I have not put down amendments to the more technical areas where there is Competition Commission involvement. It seems that in many cases that may well be relevant in terms of the tariff and so on. However, we on these Benches believe that Clauses 78, 79 and 80 are a throwback to pre-Future Forum days, and we therefore propose leaving them all out.
Lord Newton of Braintree: My Lords, perhaps I may intervene briefly, if only to avoid withdrawal symptoms from not having spoken on any day this week. I want to support my noble friend Lord Clement-Jones on the general proposition without wishing in any way to threaten mayhem if we do not get a satisfactory reply. The House is well aware, as I have referred to it on a number of occasions, that last year I went through what turned out to be the trauma of trying to engage in what was technically a takeover, although we presented it as a merger, with the neighbouring health trust. That involved Suffolk Mental Health and Norfolk Mental Health. We finally achieved it on New Year's Day, so I am, so to speak, out of work.
There was a real problem. One got the feeling that the people on the competition and collaboration panel, or whatever it was called, which overlaps quite heavily with the Competition Commission, saw us in much the same category-how can I put this without upsetting anyone?-as two rival sellers of washing detergents. They did not recognise that health is not like that. There were health issues, patient safety issues and quality of service issues that needed to trump the competition issues. I know that we have been told that that will happen, but it is very important to make sure that the machinery will ensure that it happens and that the health issues trump those narrower competition issues. All I seek from the Minister is an assurance that, one way or another, that will be the case.
Baroness Hollins: My Lords, I would like some reassurance that the regulation of competition will improve on the current situation in some circumstances. I do not know whether these amendments, or any existing provision in the Bill, will achieve that. I have a couple of examples about which I feel uncomfortable.
First, I am keen to know whether adequate safeguards are in place for the kind of situation that occurred in Surrey, to ensure that the range of providers envisaged by the Government will be able to compete on a level playing field. I remember the wise words of the economist Fritz Schumacher that sometimes "small is beautiful". Can the Minister tell the House on what basis it was decided that a £10 million bond would be required as surety from bidders for the NHS contract tendered last year for community services in south-west and north-west Surrey? The winning tender was a private company and the loser was Social Enterprise UK, which is currently providing services to central Surrey but which did not have the £10 million in the bank. That organisation is providing high-quality community services which have been acclaimed by the noble Lord's own department. At the end of its three-year contract, will it simply be taken over by the large private company which has more money in the bank?
6 Mar 2012 : Column 1739
My second question relates to the culture within the NHS and medical practice. Since the NHS began over 60 years ago, most doctors have worked primarily in the NHS and used their clinical skills first and foremost for NHS patients. There have been special contractual arrangements in place to ensure that NHS specialists with a private practice do not neglect their NHS patients. I think it is fair to say that specialists with a thriving private practice usually put their extra energy into their private practice. They are not the ones who contribute to managing and developing NHS services, and nor do they usually make much contribution to research.
Let me give the House one example of how the culture within medicine is being encouraged to change. The presidents of many if not all of the medical royal colleges have been invited to a champagne reception and dinner at a posh London venue in a couple of weeks' time. The invitation comes from a firm of solicitors and the Royal Bank of Scotland, and it states:
"Against the backdrop of challenging economic conditions and massive pressure on the public purse, we are keen to explore how other professions might be able to support your membership and the healthcare sector generally".
This seems to be a new phase in encouraging and supporting doctors to turn their attention to setting up in private practice, in chambers and in other private healthcare organisations. That is a departure from our history. Is this the direction that the Government hope the medical profession will move in? What safeguards does the Bill contain with respect to competition to protect the NHS?
7.45 pm
Baroness Thornton: My Lords, I would like to comment on the three amendments in the name of the noble Lord, Lord Clement-Jones, and then speak to the two amendments that we have in this group. They say that imitation is the sincerest form of flattery, so I am very happy that the noble Lord saw fit to take three of the amendments that we tabled in Committee and to make them his own. Those are Amendments 186, 187 and 188. That is fine by us. I understand that the Minister will be very sympathetic to these amendments and might accept them, which is probably just as well, as I would hate to embarrass the Liberal Democrat Benches any further by having votes on amendments that they have tabled and speak to but then do not support.
These three amendments would stop a review from happening. I know that the noble Lord, Lord Clement-Jones, and his colleagues need to tell us that they have won a great victory by getting the Government to concede on these amendments. Far be it from me to intrude on the coalition parties' love-in, so to speak. When we tabled these amendments in Committee they were part of an overall, comprehensive change to Part 3 of the Bill. In many ways these amendments were part of the tidying up of our suite of amendments to effect radical change to and improvement of Part 3. We certainly support these amendments.
I turn to Amendments 196A and 196B, which stand in my name and that of my noble friend. We do not understand why the noble Lord, Lord Clement-Jones, did not also table those amendments as he is going to be very successful in having his amendments agreed to.
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Earl Howe: My Lords, Amendments 196A and 196B, tabled by the noble Baroness, Lady Thornton, would remove the provision for adjudication if a significant proportion of those affected object to proposals by Monitor for methodologies to be used to calculate prices of levies to ensure the continuity of the central services or proposed licence modifications.
I am clear that we must have a process for adjudicating on Monitor's proposals if a sufficient number of those who will be affected by them object; otherwise, in these circumstances, either Monitor would have no way of proceeding with disputed proposals or those affected would have no other way of disputing proposals other than by judicial review. Either way that would be unacceptable and could result in significant harm to patients, for example if a licence condition that Monitor proposed related to securing essential NHS services. For pricing methodologies, for example, the amendments would mean that Monitor could go ahead with its proposals even if sufficient numbers of those affected objected. The only way that providers, in the case of pricing commissioners, would be able to ensure that their concerns were taken into account would again be through judicial review. We need to ensure a fair and transparent system of pricing, securing competition on quality and not price, and removing incentives for providers to cherry-pick the services that they deliver or the patients whom they treat.
I am therefore clear that we should have a process for adjudication. I am also clear that the Competition Commission should undertake that role. It has other adjudication roles. The commission has experience of working across a range of sectors, on the basis that it does not necessarily have the knowledge which it needs about those sectors in-house. It would be free from political intervention in making these judgments. It is well respected by other regulators across the economy, for which it performs a similar role. In our earlier debates, some noble Lords expressed concern that there should be appropriate checks and balances on Monitor's powers. The provision for adjudication by the Competition Commission creates one such check and balance. These amendments would remove it. For those reasons, I oppose Amendments 196A and 196B, and I hope that on reflection the noble Baroness, Lady Thornton, will withdraw them.
I turn to the Competition Commission's role in reviewing how competition is benefiting patients in the NHS. After briefing myself, I came to the conclusion that the reviews will bring considerable benefit to the NHS because they will help us understand further what effect competition has on NHS services for patients. They will also increase Monitor's accountability because they will consider how Monitor is discharging its functions. The commission will be well placed to conduct them because it is an independent body with a long history of performing such reviews across the economy. It is the body where the expert technical knowledge needed to perform this function already resides, and it
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However, I listened to the points made this evening by my noble friends Lord Clement-Jones and Lord Newton. On earlier occasions my noble friend Lord Clement-Jones was quite vocal in expressing his views to me on this subject. I have some sympathy with the argument that prescribing reviews every seven years, as the Bill stipulates, may place too great an emphasis on competition. Greater flexibility about the timing and specification of reviews may be helpful. Therefore, I am clear that such reviews of competition in the NHS, when they happen, should focus on benefits to patients. On the basis that prescribed seven-year reviews may place too great an emphasis on competition in the NHS, and given the role of the Competition Commission, if it is the view of the House that Clauses 78, 79 and 80 should be removed from the Bill, I will not oppose Amendments 186, 187 and 188.
I turn briefly to the issues raised by the noble Baroness, Lady Hollins, on procurement in Surrey. The issue was raised earlier by the noble Lord, Lord Adebowale. I agree with her and with the noble Lord that social enterprises can and do play an important role in providing innovative, high-quality services, often to very vulnerable people. Turning Point is an excellent example. The key aim of our reforms is that patients should be treated by the best providers; that bureaucratic procurement practices should not frustrate this; and that it should be quality that counts. We will take all this into account when framing the commissioner procurement regulations.
On the example quoted by the noble Baroness, I understand that the requirement for the £10 million performance bond to which she referred was subsequently withdrawn and therefore played no role in the decision to appoint a preferred bidder. However, I will write to her with further details on this.
Lord Clement-Jones: My Lords, I thank the Minister for what he said. I recognise that it is not easy to take away a piece of architecture that the Government had thought was necessary. I believe that the piece of architecture effectively fell away with the Future Forum report. I do not at all recognise his description of me as "vocal" in any circumstances.
As to the Opposition and the noble Baroness, Lady Thornton, I recognise that it is a bit difficult to acknowledge on the Floor of the House that the Government today made many concessions in collaboration with these Benches. I will promise to be gracious-if the noble Baroness is listening-about the role that she played in tabling these amendments in Committee if she will cease to be ungracious on Twitter about the achievements of, and amendments to, the Bill. I beg to move.
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Clause 79 : Reviews under section 78: powers of investigation
Clause 80 : Reviews under section 78: considerations relevant to publication
Amendment 189 had been withdrawn from the Marshalled List.
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8.26 pm
Clause 87 : Licensing criteria
190: Clause 87, page 104, line 36, leave out subsection (3) and insert-
"(3) Monitor may not set or revise the criteria unless the Secretary of State has by order approved the criteria or (as the case may be) revised criteria."
Earl Howe: My Lords, I beg to move Amendment 190 and speak to Amendments 193, 194, 195, 299 and 300. We have tabled Amendments 190, 299 and 300 to comply with the Delegated Powers and Regulatory Reform Committee's recommendations. These sought to ensure that key elements of the licensing arrangements are subject to appropriate levels of parliamentary scrutiny.
In line with that, Amendments 190 and 300 provide that the Secretary of State's approval of Monitor's licensing criteria will always be made by order, and the first such order must be subject to the affirmative procedure. Subsequent orders, in the event of Monitor wishing to revise the criteria, would be subject to the negative procedure. Similarly, Amendment 299 provides for the first set of exemption regulations made by the Secretary of State under Clause 84 to be subject to the affirmative procedure.
I turn now to Amendments 193, 194 and 195, which deal with the hugely important issue of integration of services. There is a clear consensus around the importance of having further integration and more services joined up around patients' needs. The Bill seeks to encourage and enable the delivery of integrated services.
All NHS bodies and private and third-sector providers supplying NHS services are required by the Health Act 2009 to take account of the NHS constitution in their decisions and actions. This includes the principle that the NHS works across organisational boundaries and in partnership with other organisations in the interests of patients, local communities and the wider
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Monitor would have an important role to play in supporting commissioners by enabling integration of services. That is why Clause 61 expressly requires Monitor to exercise its functions with a view to enabling integration. Nevertheless, in Committee the House raised further concerns around the extent of Monitor's role in enabling integration and co-operation. We listened carefully to those concerns, and ultimately agreed that there was more that we could do.
We have tabled Amendments 193, 194 and 195 in order to establish express power for Monitor to set and enforce licence conditions for the purposes of enabling integration, and enabling co-operation between healthcare providers where it would improve the quality or efficiency of NHS healthcare services, or reduce inequalities. Licence conditions could therefore be used to support commissioners in promoting integration and co-operation. This would also allow for licence conditions to fully cover the relevant principles and rules of the current Principles and Rules for Competition and Co-operation.
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I hope that these amendments will reassure your Lordships that we have significantly strengthened Monitor's capability in relation to integration. Not only will enabling integration be part of its general duties but it will now be able to set and enforce licence conditions specifically for that purpose. I beg to move.
Lord Patel: My Lords, my Amendment 191 relates to the standard conditions that Monitor must determine, in public, to be included in each licence under this chapter. It is a fairly straightforward amendment and I hope the Minister will recognise that it in no way affects the core principle behind the Bill; it is just an attempt to improve it.
"Before determining the first set of the standard conditions Monitor must consult the persons mentioned in subsection (8)".
Subsection (8) mentions the Secretary of State, the Commissioning Board, primary care trusts, the Care Quality Commission and, importantly,
- "such other persons as are likely to be affected by the inclusion of the conditions in licences under this Chapter".
Of course, the people most likely to be affected are the patients. If that is the case, it would be unusual not to include any bodies that work or speak on behalf of patients and the public. Therefore my amendment suggests the inclusion of "Local Healthwatch" and,
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"Local Healthwatch" being the organisation that speaks for local people and the health and well-being board having a role in commissioning. I hope that the Minister sees the value of including these two bodies.
Baroness Cumberlege: My Lords, I support this amendment, which is in my name and those of the noble Lords, Lord Patel and Lord Warner. The noble Lord, Lord Patel, has introduced it with his customary elegance and clarity. I can see no reason why these amendments should not be made. Bearing in mind that the noble Earl was so generous to me earlier when we included HealthWatch in another amendment, I live in great hope.
Lord Warner: My Lords, I, too, support this amendment. Since the noble Earl was so beastly to me over social care, I hope he will actually support this amendment.
Baroness Finlay of Llandaff: My Lords, the government amendments are indeed welcome because they reflect concerns that have been expressed. I am sure that all those who expressed those concerns are grateful.
The amendments in my name in this group relate to education and training. I know that we have somewhat threaded education and training through the Bill at all stages. Amendment 192 relates to considering education and training when setting licence conditions, and I put "education and training" because in addition to education, staff training at every level is essential.
I hope that the Government will support the view that no organisation should be fit to provide services if it does not ensure that its staff are being kept up to date and if it is not providing an environment from which people can learn. This does not mean that they all have to be recognised educational providers.
Amendment 196 in this group relates to indemnity. This amendment has been tabled again because, despite the response that we were given in Committee, concerns continue over indemnity for patients. Should a patient develop a problem subsequent to a provider going out of business, they should be covered by indemnity. It is interesting that we have the Legal Aid, Sentencing and Punishment of Offenders Bill in parallel with this Bill. We have concerns over legal aid for medical negligence. I have attached my name to amendments to that Bill concerning legal aid for the victims of clinical negligence.
I hope that the Government will see that there is a need to have indemnity within services, whoever the licensed provider is. There should be a read across to the protection of patients in the event of something going wrong or being done wrong that has harmed them, particularly if they have been harmed in such a way as to incur ongoing costs for healthcare and social care as a result of the problem that arose with the provider, whether it be a voluntary sector provider or a private provider.
Lord Clement-Jones: My Lords, I thank my noble friend Lord Howe for putting forward these amendments, particularly Amendment 193, to which I have added my name. In Committee, we were concerned that the powers of Monitor did not reflect the general spirit of the way in which the Future Forum report talked about the mixture of competition and integration.
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Earl Howe: My Lords, this has been an interesting debate and I thank in particular the noble Lords, Lord Patel and Lord Warner, and my noble friend Lady Cumberlege for tabling Amendment 191 and for giving me the opportunity to explain the Government's thinking on the important issue of patient and public involvement in Monitor's work. We are very clear that patients must lie at the centre of the reformed NHS and that the Bill establishes mechanisms to ensure that that is the case. Health and well-being boards are part of those arrangements and HealthWatch will have a vital role in giving patients and the public a real voice throughout the NHS. I can therefore understand the intent of Amendment 191-and I wish that I could accept it. However, I am sorry to say that in practical terms it is not workable and I will explain why.
The list in Clause 95(8) relates to consultation but this is expected to take place before bodies such as HealthWatch and health and well-being boards are formally established. In other words, Amendment 191 would impose a statutory requirement with which Monitor could not possibly comply. The list at subsection (8) deliberately includes only those bodies that will be in existence at the expected time of the consultation.
I can nevertheless offer the noble Lord and the House firm reassurances on this issue. First, Clause 95(8)(e) gives Monitor powers to include in the consultation "such other persons" as it "considers appropriate". Clause 61(7) places a general duty on Monitor to secure the involvement of patients and the public in decisions on the exercise of its functions, and we would firmly expect Monitor to use those powers to involve patients and the public fully in the consultation. Secondly, Clause 95(11) would require Monitor to consult with HealthWatch England, with the NHS Commissioning Board and with every clinical commissioning group in the event that the consultation takes place later than currently expected and after these bodies have been established. I hope that I have been able to reassure the House that Amendment 191 is not only unnecessary, but would actually put Monitor in an extremely difficult position, and that the noble Lord, Lord Patel, will feel able to withdraw the amendment.
I turn now to Amendment 196, tabled by the noble Baroness, Lady Finlay. The amendment raises an important issue, that of making sure that patients receive the compensation to which they are entitled in the unfortunate event that they are harmed as a result of clinical negligence. The Government agree that there must be equivalent safeguards in place for patients irrespective of who provides their NHS services. Currently the NHS contract which providers must hold to deliver services requires adequate and sufficient indemnity arrangements to be in place. In addition, to ensure equivalent protection for the future, the Government's
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I hope, therefore, that the noble Baroness will appreciate that I strongly agree with the spirit of her amendment. Nevertheless, I must set out my concerns around its potential effect, if she is thinking of pressing it. First, the amendment could be implemented by employing organisations requiring indemnity from their own staff. Employees would then have to obtain their own personal indemnity. However, I do not believe it would be right to transfer this burden to staff or that employees would support it. Further, I do not believe it would be cost-effective. My second concern is about potential unintended consequences. Currently the Limitation Act 1990 limits the time available that personal injury claimants have to bring their claim. The overwhelming majority of claimants have three years to make their claim under the terms of that Act. Requiring all providers to hold indemnity for the lifetime of all patients, potentially much longer than a patient's legal entitlement to make a claim, would be disproportionate and incur significant costs. Overall, the effect of such a wide-reaching clause would be to divert resource unnecessarily away from patient care. I am sure that that is not what the noble Baroness would ever seek to do and I do not believe that it is in the interests of patients or the NHS. I hope that on reflection and in the light of my assurances about what we are planning, the noble Baroness will feel able not to press her amendment.
The noble Baroness also referred to her Amendment 192, which I think we debated in a previous group. The Government have listened to concerns on education and training raised by her and other noble Lords and we have brought forward amendments to require the board and CCGs to have regard to the need to promote education and training when exercising their functions. Further, the Bill requires Monitor in Clause 64(j) to have regard to,
when exercising its functions. I suggest to the noble Baroness that Amendment 192 is not required.
At this juncture, it might be worth quickly reminding the House that all providers of NHS services will be licensed by Monitor. The Royal College of Physicians has sought reassurances on how patient choice of any qualified provider would work. Even though the choice of any qualified provider is not in the Bill, I am happy to confirm that providers would always be required to comply with national quality standards. Under our reforms, providers above a minimum size would be expected to take part in the provision of education and training, and to work within agreed local care pathways to ensure safe and joined-up care. I hope that that is a reassurance not only to the Royal College of Physicians but to other noble Lords.
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Baroness Finlay of Llandaff: I am grateful to the Minister for his reply on indemnity. Would the risk pool apply to the provider rather than be linked to the individual patient? If there is an acute problem, some hospices will accept referrals directly from patients and their families rather than waiting for a GP necessarily to refer them. Those patients are all being treated in the voluntary sector; they are not paying; they are all being treated the same; and they have been under NHS providers for other parts of their treatment. The Minister may not be able to answer my question now, but I flag up such a situation as a potential that will need to be covered off in providing. However, I am sure that what he has said tonight will be warmly welcomed by the voluntary sector, which provides an important and, in many places, essential clinical service-which, I venture to suggest, hospices do par excellence. Their ability to meet patient and family need at great speed has allowed them to be recognised as being so important.
Earl Howe: My Lords, I understand the noble Baroness's question. It might be best if I wrote to her because the circumstances that she posits are such as to make it important that I do not get it wrong if I give her an answer now. As she knows, the broad answer to her question is that our aim is for all NHS-funded care to be covered. She has raised a particular set of circumstances on which I shall have to take advice, if she will allow.
Clause 95 : Standard conditions
Amendments 191 and 192 not moved.
Clause 97 : Limits on Monitor's functions to set or modify licence conditions
193: Clause 97, page 109, line 13, at end insert-
"(da) for the purpose of enabling health care services provided for the purposes of the NHS to be provided in an integrated way where Monitor considers that this would achieve one or more of the objectives referred to in subsection (2A);
(db) for the purpose of enabling the provision of health care services provided for the purposes of the NHS to be integrated with the provision of health-related services or social care services where Monitor considers that this would achieve one or more of the objectives referred to in subsection (2A);
(dc) for the purpose of enabling co-operation between providers of health care services for the purposes of the NHS where Monitor considers that this would achieve one or more of the objectives referred to in subsection (2A);"
194: Clause 97, page 109, line 22, at end insert-
"(2A) The objectives referred to in subsection (2)(da), (db) and (dc) are-
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(a) improving the quality of health care services provided for the purposes of the NHS (including the outcomes that are achieved from their provision) or the efficiency of their provision,
(b) reducing inequalities between persons with respect to their ability to access those services, and
(c) reducing inequalities between persons with respect to the outcomes achieved for them by the provision of those services."
195: Clause 97, page 109, line 29, at end insert-
"( ) In subsection (2)(db), "health-related services" and "social care services" each have the meaning given in section 61(11)."
Clause 98 : Conditions: supplementary
196ZA: After Clause 99, insert the following new Clause-
"Notification of commissioners where continuation of services at risk
(1) This section applies where Monitor-
(a) takes action in the case of a licence holder in reliance on a condition in the licence under section 98(1)(i), (j) or (k), and
(b) does so because it is satisfied that the continued provision for the purposes of the NHS of health care services to which that condition applies is being put at significant risk by the configuration of certain health care services provided for those purposes.
(2) In subsection (1), a reference to the provision of services is a reference to their provision by the licence holder or any other provider.
(3) Monitor must as soon as reasonably practicable notify the National Health Service Commissioning Board and such clinical commissioning groups as Monitor considers appropriate-
(a) of the action it has taken, and
(b) of its reasons for being satisfied as mentioned in subsection (1)(b).
(4) Monitor must publish for each financial year a list of the notifications under this section that it has given during that year; and the list must include for each notification a summary of Monitor's reasons for being satisfied as mentioned in subsection (1)(b).
(5) The Board and clinical commissioning groups, having received a notification under this section, must have regard to it in arranging for the provision of healthcare services for the purposes of the NHS."
Lord Warner: My Lords, I shall speak also to Amendment 214G which stands in my name. The amendments arise from our debate in Committee about what we then described as a "pre-failure regime". The argument that I was trying to sustain, with helpful support from different parts of the Committee, was that it would be better for Monitor to get engaged when it could see failure coming at it down the track rather than waiting for the train crash to occur and use the health special administration procedures that were provided for in the Bill.
My amendment then was probably technically defective but it served the purpose of raising the issue. The Minister was not so off-putting that I thought that I would not have another go at this, so, with the help of the noble Lord, Lord Patel, and the noble Baroness,
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The nub of what is in Amendment 196ZA is that it provides for Monitor when it can see that a licence holder's conditions are likely to be imperilled by a current configuration of health services in the wider health economy-not just within that licence holder's own individual trust. It can draw the attention of commissioners-the national Commissioning Board and clinical commissioning groups-to those risks which it can foresee and it has to give its reasons for doing so. But rightly in my view and, I believe, that of the Government, it puts the onus on the commissioners to do something about it. It does not require a top-down intervention, but it flags up very seriously to the commissioners that a problem is looming and they need to do something about it. Just to give more force to that, each financial year Monitor will publish a list of the notifications that it has issued in that financial year, putting commissioners on notice that they have a problem, that they need to do something about the reconfiguration of services and that they need to take some action to ensure that there are sustainable NHS services in that part of the country.
I pay tribute to the civil servants at the Department of Health because they have done something rather ingenious that I never even thought of in Amendment 214G, which is to take an application by a service provider to Monitor to secure some adjustment in the price paid for particular services to make Monitor think about whether there is anything more significant behind that application and whether there is a risk to the sustainability of services in a particular area. If it does consider that that is necessary, it can again notify the commissioners of its concerns about the need to consider service reconfiguration in that area.
These two amendments, which have been given a lot of technical help by the Department of Health and a lot of support from the Minister, meet my concerns and, having talked briefly to the noble Baroness, Lady Williams of Crosby, I believe that they also meet hers. There is an adequate set of arrangements to put commissioners on notice that failure may be looming so that they can take action under their responsibilities. Just to make sure that they do, each year there will be a list of the notifications that Monitor has issued so that it is on the public record that Monitor has spotted that there is something of concern and has required commissioners to take action.
That meets my concerns and I think that it meets the concerns of the noble Baroness, Lady Williams of Crosby and the noble Lord, Lord Patel. In order to table the amendment in time for today's debate, I did not have time to collect the signatures of my partners in crime on Amendment 217, but I have every reason to believe that they would be satisfied with the Government's response to our concerns.
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With regard to subsection (5) of Amendment 217, which I have mentioned to the Minister, I think it would be a good idea if the Government were to consider assembling a group with expertise to help local people to reconfigure their services. It is often difficult for people at the local level to think through how they might reconfigure services to make them sustainable. I do not suggest a top-down approach but some sort of panel that could help local people and facilitate the reshaping and redesign of services. That would be a helpful way of proceeding. It might help a lot of people to get through the difficult task of reshaping services when the need arises. Without further ado, I beg to move.
Baroness Williams of Crosby: My Lords, my intervention will be extremely short. I am delighted that the noble Lords, Lord Warner and Lord Patel, put down this proposal for what one might describe as precautionary failure. We were very concerned that there might be no regime that would enable services to continue because one had seen in advance the possibility of a particular place getting into a great deal of trouble. This is a very satisfactory proposal to put before the Government to deal with the continuation of health services for an area, even when those services get into difficulties.
I also strongly commend the proposal of the noble Lord, Lord Warner, about the small group of local people. That has one great advantage: that small group will then become part of what one might describe as a lobby for a sensible outcome, for a proper reconfiguration or change in the structure of services. That is very important. Otherwise, you almost invariably get very powerful local opposition to any substantial change and no natural constituency of people who support it. This is an imaginative idea. I am pleased to be associated with the amendment of the noble Lords, Lord Warner and Lord Patel.
Lord Patel: My Lords, I support the amendment. The noble Lord, Lord Warner, and the noble Baroness, Lady Williams of Crosby, have said all that needs to be said. I had my name to Amendment 217. To relieve the anxiety-if they had any-of the noble Lord, Lord Warner, and the Minister, I will not move that amendment either. I strongly support Amendment 196ZA.
Baroness Murphy: My Lords, I also add my support to the very practical solution given in Amendments 196ZA, 214G and 217 that will provide Monitor with a mechanism to deal with future, upcoming failure and intervene early. That is very practical. I hope that it will be attractive to the opposition Benches because, in part, it deals with their anxieties about special administration orders. None of us wanted to see those special administration orders used early. We want them as a very rare fallback position, and to use them maybe once in a decade not once a year. If there were a mechanism like this one, enabling a practical way of targeting and getting local commissioners to address local failure, we could avoid some of the draconian measures that it is necessary to have in the Bill but which none of us wants to see used frequently. I hope that the solution will commend itself to the opposition as addressing their concerns about this regime.
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Lord Beecham: My Lords, I can certainly reassure the noble Baroness on that score. I warmly endorse the amendment moved by my noble friend and I hopefully anticipate a warm response from the Minister.
I shall speak briefly to the amendments in the name of my noble friend Lady Thornton and myself. In Amendments 217ZA and 217ZM we propose to leave out the chapter on financing special administration cases. The whole field of health special administration, which would apply to non-NHS providers to deal with failure, is highly complex. It would be better for the financial side to have the NHS operating as a risk pool; that could be factored into the work of commissioners as part of dealing with non-NHS providers in their commissioning plans. However, it was not my intention to divide the House on this matter.
We also have Amendment 220D to leave out the clause on repeal of de-authorisation and Amendment 221A to leave out the clause on the abolition of NHS trusts in England, as we think that that is unnecessary. But the main thrust of our consideration of this group of amendments is undoubtedly to support the amendments of my noble friend Lord Warner, which deal substantially with most of the significant issues here, and we will not press our amendments.
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Earl Howe: As I hope will be clear, the Government's proposals are for a fair, transparent and comprehensive framework that protects patients and taxpayers' interests by securing continued access to services through early intervention to prevent failure wherever possible and effective arrangements to secure continuity of NHS services should a provider become unsustainable.
The Bill builds on and improves existing arrangements by putting commissioners in the lead for shaping services for patients and providing a clear role for Monitor in supporting commissioners. It will ensure that change happens when the status quo is unsustainable, and there will be sufficient funding to support this. The Bill goes further and addresses the gaps in existing legislation, such the lack of protections for patients whose NHS core is delivered by social enterprises and other independent providers. The Bill gives Monitor a comprehensive range of powers to intervene proactively to support reorganisation and prevent failure to maintain service continuity.
I turn to Amendments 196ZA and 214G. I am grateful to the noble Lord, Lord Warner, for his patience in working with the Government on this issue. I see that the noble Lord, albeit with a tiny bit of help, has really got to the core of our proposals for ensuring the continuity of services for patients by clarifying a role for Monitor, which is to support commissioners and provide them with information that they need to take the right decisions about services in the best interests of patients. The key aspect of the noble Lord's amendments is that they reinforce the fact that commissioners remain in the lead for responding to risks to services and, in partnership with providers and other local stakeholders, for engaging on service change to reduce those risks. That is why I am pleased to accept these amendments, which also reflect the King's Fund recommendation on how the Bill could be improved to support vital service reconfiguration.
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However, it is not always possible or desirable to prevent provider failure at all costs. As a last resort, when a provider becomes unsustainable-and I emphasise that that will be only when all other interventions have been exhausted or may not be in patients' best interests-a continuity of services administrator may be appointed to protect patients' interests and secure NHS services in line with requirements determined by commissioners. For the first time, there will be similar protection for patients who rely on essential NHS services regardless of who the provider might be. The existing legal framework has no such protection for patients who rely on NHS services provided by independent providers, including the social enterprises established by the previous Government when the noble Baroness, Lady Thornton, was Health Minister. I am sure noble Lords would agree that if a social enterprise delivering essential community palliative care became unsustainable, then surely its patients should receive protections that would secure the continuity of that service, as do patients of the foundation trust.
The reality of the NHS is that it is a comprehensive health service delivered by a diverse range of providers. Part 3 recognises that reality and will protect patients' access to that comprehensive service. I cannot agree with the noble Lord, Lord Beecham, as his amendments would remove this type of protection for patients. Fundamental to our aim of protecting patients' access to a comprehensive health service is the need to ensure that sufficient funding is set aside for when things go wrong. The King's Fund and others have said that they support the establishment of a transparent funding mechanism for securing essential services when providers go into administration. When the noble Baroness was a Health Minister, her Government presided over a period of sustained growth in the economy, but sadly that is no longer the case. Despite economic challenges, the coalition has continued to increase NHS funding above the rate of inflation, but we need to be prudent to be able to guarantee that funding will be available to protect patients when any provider of essential services gets into difficulty. The problem with the noble Lord's amendment is that it would put that at risk.
That funding is essential because we simply cannot be sure otherwise that sufficient funding would be available centrally, particularly when the Treasury will face competing demands on any surplus funds held centrally by Whitehall departments. A further benefit of our approach is that the funding will be built up from commissioners and providers, including private providers, based on a transparent methodology and in proportion to risk. That will strengthen financial incentives for providers and commissioners to manage risks effectively and help to end the culture of back-room bailouts.
I hope that the arguments that I have put forward demonstrate how Part 3 will strengthen the protection of patients' interests. Once again, I thank the noble Lord, Lord Warner, for his amendments, which will improve the Bill and undoubtedly benefit patients. I hope that noble Lords will join me in my support for them, and I ask the noble Lord, Lord Beecham, to withdraw his amendment, as he has indicated he will.
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Lord Warner: My Lords, I am grateful for the Government's support for this amendment.
Clause 101 : Modification references to the Competition Commission
Clause 102 : Modification of conditions by order under other enactments
Clause 111 : Imposition of licence conditions on NHS foundation trusts
196C: Clause 111, page 119, line 19, leave out subsection (1) and insert-
"(1) Where Monitor is satisfied that the governance of an NHS foundation trust is such that the trust will fail to comply with the conditions of its licence, Monitor may include in the licence such conditions relating to governance as it considers appropriate for the purpose of reducing that risk.
(1A) The circumstances in which Monitor may be satisfied as mentioned in subsection (1) include circumstances where it is satisfied that the council of governors, the board of directors or the council of governors and board of directors taken together are failing-
(a) to secure compliance with conditions in the trust's licence, or
(b) to take steps to reduce the risk of a breach of a condition in the trust's licence."
Earl Howe: My Lords, I shall speak also to government Amendments 197A, 197B, 197C, 198A, 198B, 199A, 199B, 200A, 300ZA and 300ZB.
Monitor will continue as the regulator of NHS foundation trusts, as I have said. We had always intended this to be the case and I welcome the opportunity to clarify our position. Monitor will regulate foundation trusts through a new licensing regime, which it will administer jointly with the Care Quality Commission. This will help to strengthen collaboration between the two regulators. It will license foundation trusts to provide NHS services, as it would license anyone else who wished to do so, to ensure that NHS services are protected as financially sustainable and of high clinical quality.
Part 3 anticipates that Monitor will set differential licence conditions for foundation trusts to reflect their unique status and governance structures. Monitor would have power to intervene and direct foundation trusts to take action to ensure compliance with licence conditions. This would include the power to enforce requirements on foundation trusts to maintain continuity of NHS services and protect essential NHS assets, consistent with its principal purpose, as defined in statute. Those powers are set out in Clause 105. I emphasise that these enforcement powers would not be transitional.
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However, I recognise that this was not as clear in the Bill as it could have been. I am grateful to noble Lords, particularly my noble friends Lord Clement-Jones, Lord Marks, Lady Barker and Lady Tyler, for their work in highlighting this issue. I have tabled four amendments to Clause 111-Amendments 196C, 197A, 197B and 197C-which clarify the position. These enduring powers would enable Monitor to require a foundation trust to remove directors or governors in exceptional circumstances as a form of remedial action, where it considered this necessary. This would be appropriate only in the case of a very serious breach of licence conditions.
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