House of Commons - Explanatory Note
Health And Social Care Bill - continued          House of Commons

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Intervention Powers

346. Section 84 of the 1977 Act enables the Secretary of State to appoint an inquiry in connection with matters arising under the 1977 Act, Part I of the 1990 Act or Part I of the Health Act. In addition to these formal inquiries, the Secretary of State conducts or appoints a variety of 'informal' inquiries, investigations and reviews in the exercise of his powers under section 2(b) of the 1977 Act. Finally, the Commission for Health Improvement may investigate matters relating to the management, provision and quality of health care for which NHS bodies are responsible (see section 20(1)(c) of the Health Act).

347. The Secretary of State has powers to intervene if NHS bodies fail to perform their functions or fail to comply with regulations or directions (section 85) and if, by reason of an emergency, a service under the 1977 Act may cease to be provided (section 86).

Community Health Councils

348. Community Health Councils ("CHCs") were established in 1974 and are now provided for in section 20 of, and Schedule 7 to, the 1977 Act. The Secretary of State has a duty to establish CHCs for Health Authority areas or parts of Health Authority areas. The members of each CHC include local authority and voluntary organisation representatives and persons appointed by the Secretary of State. Each CHC has a duty to represent the interests in the health service of the public in its district. Further provision for CHCs is made under the regulations under paragraph 2 of Schedule 7 - see the Community Health Councils Regulations 1996 (S.I. 1996/640, as amended by S.I. 1999/646, 1999/2906 and 2000/657). In particular-

  • CHCs review the operation of the health service in its district and make recommendations and provide advice to their local Health Authority

  • Health Authorities must consult CHCs on proposals for substantial developments of the health service in the CHCs' districts and on proposals for substantial variations in the provision of such service

  • Health Authorities must provide information to CHCs about the planning and operation of health services in their area and meet CHCs at least once a year

  • CHCs may inspect premises controlled by NHS bodies

349. In addition to their general duty, CHCs have various specific functions relating to reviewing the operation of the health service in their districts, which are conferred by regulations. They also provide advice and information to the public on local health services and assist patients making complaints about the services provided by NHS bodies and practitioners, although these additional functions are not specified in regulations.

350. CHCs are advised and assisted by the Association of Community Health Councils in England and Wales ("ACHCEW"), which was established by the Secretary of State under paragraph 5 of Schedule 7 to the 1977 Act. The National Health Service (Association of Community Health Councils) Regulations 1977 (SI 1977/874) provides for the establishment and operation of ACHCEW.

Part II system - family health services

351. The system provided for under Part II of the Act is quite different. The broad structure of the Part II system is similar for doctors, dentists, persons providing ophthalmic services and persons providing pharmaceutical services. The existing system will first be described as it refers to doctors. The different arrangements as they apply to the other professional groups will be set out later.

General Medical Services

352. Under section 29 of the 1977 Act, it is the duty of each Health Authority in accordance with regulations to arrange for medical practitioners to provide personal medical services for all persons in the area who wish to take advantage of the arrangements. These services are described as general medical services (GMS). A principal feature of the system as it operates in practice is that (apart from certain exceptional cases) it is not the Health Authority itself which provides the GMS; instead, it enters into separate statutory arrangements with independent practitioners for the provision of those services. GPs are not employees of the Health Authority; they are independent professionals who undertake to provide GMS in accordance with the body of regulations governing that activity. Those Regulations are currently the National Health Service (General Medical Services) Regulations 1992 (S.I. 1992/635) as amended.

353. The remainder of 1977 section 29 sets out certain things which must or may appear in the Regulations. Section 30 deals with the matter of applications by medical practitioners to be included in what is known as the "medical list": that is the list kept by each Health Authority of GPs who provide GMS in its area. Sections 31 and 32 provide for each GP on a medical list to have undergone vocational training. Section 33 provides for the system for admitting GPs to medical lists. Section 34 provides for regulations to be made relating to the Medical Practices Committee ("MPC"), which has a role in admitting GPs to the medical list. The MPC is set up under section 7 of the 1977 Act. Sections 29A and 29B (as inserted by section 32 of the Primary Care Act) make further provision relating to medical lists and vacancies.

354. It is the duty of each Health Authority, in accordance with the Regulations, to administer the arrangements made for the provision of GMS and other family health services (section 15 of the 1977 Act). The Health Authority must also perform such management and other functions relating to those services as may be prescribed.

355. In contrast to the Part I system, therefore, the duty to make arrangements for those services is conferred directly upon Health Authorities, rather than upon the Secretary of State. Nonetheless, in exercising functions under Part II, Health Authorities may be the subject of Secretary of State directions issued under section 17 of the 1977 Act. Health Authorities are able to delegate their Part II functions in accordance with regulations made under section 16 of the Act.

356. Subject to any Secretary of State directions under section 17A(4) of the 1977 Act, Health Authorities may direct Primary Care Trusts to exercise their functions in relation to GMS, but not in relation to other Part II services (see section 17A(3) of the Act). The Secretary of State has directed Health Authorities that they may delegate only a limited range of GMS functions to Primary Care Trusts.

357. This broad structure of the Part II system is similar for dentists, persons providing ophthalmic services and persons providing pharmaceutical services, but there are significant differences, most notably relating to persons providing ophthalmic and pharmaceutical services.

358. The provision for dentists (section 35 of the 1977 Act) is in very similar terms to that for doctors in section 29, although it will be noted that the duty upon the Health Authority is subtly different. In the case of doctors, the Health Authority must arrange for sufficient PMS to be provided for everybody in the area who wishes to take advantage of the arrangements. In the case of dentists this duty is not quite the same: the duty is not to arrange the provision of GDS for everybody in the area who wishes to have GDS, but rather to arrange with dentists in the area that any person for whom those dentists have undertaken to provide GDS receive the promised GDS. There is also no equivalent of the MPC to control the entry of GDPs to dental lists; and there is no equivalent of section 29(2)(c) of the 1977 Act (which provides for the assignment of patients to doctors). However, subject to that, the systems are by no means dissimilar: there exists a dental list of GDPs who undertake to provide GDS. There is a system of dental vocational training (although it has been introduced by regulations and not by primary legislation). The relationship between the Health Authority and the GDP is (usually) again a statutory one between a Health Authority and an independent professional. Unlike the case of GPs, however, there is in regulations provision in the case of dentists for the employment of salaried dentists at health centres. These dentists are employed by the Health Authority, and represent one of the rare occasions when it is the Health Authority itself which provides the services in question via its employees.

359. So far as chemists and opticians are concerned, opticians are provided for in section 38 of the 1977 Act, again according to the same scheme whereby the Health Authority makes statutory arrangements with independent practitioners (who, in this case, might be individuals or bodies such as companies). However, the range of services to be provided by opticians is very much smaller. The only content now surviving of general ophthalmic services ("GOS") is sight testing for children, for persons whose resources are less than their requirements, and for other prescribed persons.

360. For pharmaceutical services ("PhS"), provided for under section 41 of the 1977 Act the arrangements are again made by Health Authorities with independent persons or bodies. The system is governed by regulations; but the duty this time is to arrange for the provision, to persons who are present in the Health Authority's area, of drugs, medicines and listed appliances which are prescribed for them by health service doctors, dentists, or nurses, and of such other services as may be prescribed. So far as PhS are concerned, there are detailed regulations (made under sections 42 and 43) relating to entry on to a pharmaceutical list.

361. Sections 43A and 43B of the 1977 Act, as substituted by section 10 of the Health Act, provide a structure for the remuneration of persons providing Part II services. Section 10 of the Health Act has, however, yet to be brought into force. Neither have the original sections 43A and 43B inserted by the Health and Social Security Act 1984 (c.48) been commenced. In effect the original sections inserted by the 1984 Act must be complied with because of section 7 of the Act, which provides that a determination of remuneration made before the coming into force of those provisions is deemed to be validly made if regulations authorising it could have been made had that provision been in force at that time. It is therefore not open to the Secretary of State or anyone else to make a determination which is inconsistent with the provisions of sections 43A and 43B as inserted by the 1984 Act. What in fact happens is that the Secretary of State makes and publishes a determination for each of the professions, which takes the form of the separate document referred to in each of the sets of Regulations governing the four professions. These determinations therefore have the force of law, although they are not subject to any further degree of formality or Parliamentary procedure. The revised version of sections 43A and 43B, substituted by section 10 of the Health Act, were intended to provide a new framework to govern the remuneration of Part II practitioners, but have yet to be brought into force.

362. Each profession has in each Health Authority area a local representative committee (called the Local Medical Committee, the Local Dental Committee, and so on). These represent local practitioners and are provided for under sections 44 and 45 of the 1977 Act.

363. Practitioners may be removed or suspended from the list in which their names are included by the NHS Tribunal, which is provided for under sections 46-49 of the 1977 Act. The NHS Tribunal is an independent body which hears representations by Health Authorities and others against family health service practitioners, that is people with whom Health Authorities have made arrangements for the provision of general medical, general dental, general ophthalmic or pharmaceutical services under Part II of the NHS Act 1977. Health Authorities (and others) may make representations that to allow a person to continue to be family health service practitioner would be prejudicial to efficiency of the service in question. The Tribunal may direct that a practitioner's name is to be removed from one or more lists of people with whom Health Authorities have made arrangements for the provision of family health services. A person who has been removed from a list is no longer entitled to provide the service in question. The NHS Tribunal may also disqualify a person from involvement in any capacity in the provision of family health services.

364. The powers of the NHS Tribunal were extended by the National Health Service (Amendment) Act 1995, amongst other things to give it powers of interim suspension from lists. The powers of the NHS Tribunal were further extended by section 40 of the Health Act 1999, in particular to extend its jurisdiction to people who have acted fraudulently towards or in connection with the NHS (although this section has yet to be brought into force).

365. The remainder of Part II contains a number of miscellaneous provisions.

The National Health Service and Community Care Act 1990

NHS Trusts

366. Section 5 of the 1990 Act, and the immediately following provisions, provide for the setting up of bodies known as NHS Trusts. These are not Health Authorities but are separate, independent bodies set up to assume responsibility for the ownership and management of hospitals or other establishments or facilities previously managed or provided by a Health Authority; or to provide and manage hospitals or other establishments or facilities that were not previously so managed or provided. Section 5(1), as amended by section 13 of the Health Act, now provides that trusts are established to provide goods and services for the purposes of the health service. A trust's functions are conferred by its establishment order made under section 5(1) and by Schedule 2 to the 1990 Act.

367. Nearly all the hospitals in the country are now run by NHS trusts, although increasingly, smaller "community" hospitals are being run by Primary Care Trusts. The essential difference between NHS trusts and the hospitals run directly by Health Authorities is that the latter were funded by money paid to Health Authorities for the purpose by the Secretary of State under (what is now) section 97(3) of the 1977 Act; whereas (subject to certain exceptions) NHS trusts have no money paid to them directly by the Secretary of State, but instead must compete with each other for orders for their services placed by Health Authorities. Health Authorities are thus now seen as "purchasers" or "commissioners" of health care on behalf of the local population; while trusts are included among the "providers" of this health care. Health Authorities may also choose to purchase health care from private sector institutions.

368. This system created the "internal market", whereby the whole of the operation (including trusts) is still the NHS, but for internal purposes the purchasers or commissioners were split from the providers.

369. The 1990 Act conferred on NHS trusts a substantial degree of autonomy. As well as not being funded centrally, the Secretary of State was able to give directions to NHS trusts only in relation to a limited range of subjects (paragraph 6 of the Schedule). The Health Act restricted this freedom by extending to NHS trusts the Secretary of State's power of direction under section 17 of the 1977 Act (section 12 of the Health Act).

NHS Contracts

370. The nature of the arrangements between Health Authorities and trusts is not that of an ordinary contract enforceable at law. Instead the 1990 Act provided for a system of NHS contracts (section 4), which are explicitly not contracts enforceable at law (section 4(3)), but which had attached to them a special form of internal arbitration by the Secretary of State. The list of bodies between whom certain agreements take the form of NHS contracts rather than ordinary contracts is contained in section 4(2).

The National Health Service (Primary Care) Act 1997

Personal Medical Services and Personal Dental Services

371. The Primary Care Act introduced a new method of delivery of family health services. Personal medical services (PMS) and personal dental services (PDS) may be provided under agreements known (in the initial stage at least) as "pilot schemes" (sections 1-3 of the Primary Care Act). These agreements are made between the Health Authority and one or more of the persons listed in section 3(2), which includes NHS trusts, GPs and NHS employees. Before a pilot scheme may be made, the proposals for the scheme must be submitted to, and approved by, the Secretary of State (section 4 and 5). The system of pilot schemes is intended ultimately to be replaced by a permanent regime.

372. Pilot schemes allow PMS and PDS (essentially the same as GMS and GDS) to be provided under the Part I system. The provisions of the 1977 Act apply in relation to functions of the Secretary of State in relation to pilot schemes as if the functions were functions under Part I of the Act. NHS trust may enter into a pilot scheme as a provider of PMS or PDS. The 1977 Act (and in particular section 17) has effect in relation to services under pilot schemes as if the services were provided as a result of delegation by the Secretary of State (by directions given under section 13 of that Act) of functions of his under Part I (section 9 of the Primary Care Act).

373. These provisions allow PMS and PDS to be provided otherwise than through the rigid regulatory system of Part II of the 1977 Act. They allow Health Authorities the power to determine locally the content of the service in their area or the practitioners with whom they choose to make the arrangements.

The Health Act 1999

374. Part I of the Health Act made further changes to both the Part I system and the Part II system.

Primary Care Trusts

375. Primary Care Trusts are a new tier of administrative body below Health Authorities, and are primarily concerned with the Part I system, although they may exercise certain Health Authority functions relating to GMS. Primary Care Trusts are established by the Secretary of State by orders under section 16A of the 1977 Act (as inserted by section 2(1) of the Health Act), with a view to their carrying out the activities listed in paragraphs (a) to (c) of that section. Their functions are conferred, in the main, by directions given by Health Authorities under section 17A of the 1977 Act, as inserted by section 12 of the Health Act.

376. In the exercise of the functions under Part I of the 1977 Act delegated to them by their Health Authorities, Primary Care Trusts have taken on the "commissioning" activities of Health Authorities. Unlike Health Authorities, however, they also provide certain services (usually community health services rather than hospital services) in the exercise of those functions. A Primary Care Trust is something of a "hybrid" between a Health Authority and an NHS trust. The other significant feature of Primary Care Trusts is that the regulations for the membership of Primary Care Trusts made under paragraph 5 of Schedule 5A to the 1977 Act, as inserted by Schedule 1 to the Health Act, provide that a substantial number of Primary Care Trust members and Primary Care Trust committee members must be GPs, local nurses and other health care professionals providing or assisting the provision of services under the 1977 Act.

Part II services

377. The Health Act provides new powers for the Secretary of State to require persons providing Part II services to have indemnity cover (section 9), a new structure for the remuneration of Part II practitioners (section 10, which has not yet been brought into force) and makes further provision for the disqualification of such practitioners by the NHS tribunal on the grounds of fraud (section 40, which again has not yet been brought into force).


378. Section 18 of the Health Act imposes a "duty of quality" on Health Authorities, Primary Care Trusts and NHS trusts. Sections 19 to 24 provide for the establishment and operation of a new independent statutory body known as the Commission for Health Improvement, which is responsible for monitoring the quality of care for which NHS bodies have responsibility. The Commission is able to conduct a variety of reviews and investigations (section 20(1)).

The NHS and Local Authorities

379. Local Authorities are responsible for the provision of what may be described as "social care", e.g. residential accommodation for the disabled or elderly. The enactments under which functions in this respect are conferred on Local Authorities are set out in Schedule 1 to the Local Social Services Act 1970 (c.42) and other legislation. Section 21 and Schedule 8 of the 1977 Act make provision for the exercise of certain specified functions. Local Authorities also exercise functions in respect of housing (eg. the Housing Act 1985 (c.68)) and education (the Education Act 1996 (c.56)).

380. Sections 22 and sections 26 to 28BB of the 1977 Act, as amended by sections 27, 29 and 30 of the Health Act, make provision for co-operation between the NHS and Local Authorities. Section 22(1) of the 1977 Act, as substituted by section 27(2) of the Health Act, places a general duty on NHS bodies (on the one hand) and Local Authorities (on the other) to co-operate in the exercise of their functions in order to secure and advance the health and welfare of the people of England and Wales. Sections 26 to 28 make provision for the supply of goods and services by the Secretary of State to Local Authorities and vice-versa. Section 28A of the 1977 Act, as amended by section 29 of the Health Act, makes provision for Health Authorities in England to make payments towards expenditure by various Local authority bodies on community services, such as social services, housing and education for the disabled. Section 28B makes similar provision for Wales.

381. The Health Act makes further provision for co-operation between the NHS and local authorities. Most importantly, section 31 makes provision for NHS bodies and Local Authorities to enter arrangements under which an NHS body exercises Local authority functions or vice-versa. Provision is also made for arrangements to operate a "pooled fund" from which payments may be made towards expenditure on either NHS or Local authority functions. In addition to section 31, section 28 provides for Health Authorities, with the assistance of Primary Care Trusts, NHS trusts and Local Authorities, to prepare plans setting out a strategy for improving both the health of the local population and the provision of health care to that population. Section 30 of the Health Act inserts a new section 28BB into the 1977 Act, which makes provision for Local Authorities to make payments towards expenditure incurred by NHS bodies: this provision mirrors section 28A of the 1977 Act.

Health Authority funding and performance

382. The Act made it possible for the Secretary of State to increase a Health Authority's allocation where certain conditions around performance are satisfied. The intention was to reward Health Authorities that demonstrated the most progress in implementing their plan for improving health and health care. All Health Authorities including those making good progress from a low baseline are eligible. The Secretary of State is allowed to attach conditions to how the money should be spent and if it is not spent in accordance with the conditions he can claw it back.



383. A key concept in the legislation relating to social care is that of "community care services". This term is defined in section 46 of the National Health and Community Care Act 1990. Community care services are services which a local authority may provide or arrange under

     Part III of the National Assistance Act 1948,

Section 45 of the Health Services and Public Health Act (promotion by local authorities of the welfare of old people),

     Section 21 of and Schedule 8 to the National Health Service Act 1977; and

     Section 117 of the Mental Health Act 1983 (after-care).

384. Local Authorities are under given by section 47 of the 1990 Act a duty to assess a person's needs for community care services.

385. National Assistance Act 1948Part III of this Act deals with local authorities' responsibilities with regard to arranging and charging for residential and nursing care placements.

386. In particular the Act gives powers to and imposes duties on local authorities in respect of accommodation. Section 21 of the 1948 Act enables local authorities (with the approval of the Secretary of State) to provide residential care for people over the age of 18 where they need residential care and care and attention is not otherwise available. Where the Secretary of State directs a local authority to provide such care, a local authority has a duty to provide it. The Secretary of State's approvals and directions are set out in Department of Health Circular LAC (93) 10. Section 26 of the 1948 Act enables local authorities to discharge their responsibility under section 21 by entering into arrangements with certain private and voluntary sector care homes.

387. A local authority may be required under section 21 of the 1948 Act to provide nursing care incidental or ancillary to the provision of accommodation. The Court of Appeal so decided in the case of R v North Devon Health Authority ex parte Coughlan [2000] 3 All E R 850, [2000] 2 WLR 622.

388. Sections 22 and 26 of the 1948 Act set out the system whereby a charge may be made for the provision of accommodation under sections 21 and 26. The charge is determined in accordance with a means test. This means testing system is set out in regulations, namely the National Assistance (Assessment of Resources) Regulations [S.I. 1992/2977]. It follows that where a local authority provides nursing care incidental or ancillary to the Part III accommodation such services fall within the means testing system

389. Where a person is required to make a contribution towards his care under the means testing regime, but falls behind with the payments, the local authority may take a charge over any interest in land that the person has in the circumstances set out in section 22 of the Health and Social Services and Social Security Adjudications Act 1983.

The 1977 Act

390. The 1977 Act places a duty on the Secretary of State to continue to promote a comprehensive health service in England and Wales. It provides that NHS services are in general to be free. The Secretary of State is required by section 3 of the 1977 Act to provide such health services as he considers necessary to meet all reasonable requirements in England and Wales. Section 3(d) specifically mentions nursing services. As mentioned above, however, the NHS is not currently solely responsible for providing nursing care. Nursing services which are incidental and/or ancillary to the provision of accommodation provided by local authorities can be provided by those local authorities.

The NHS and Community Care Act 1990

391. This Act introduced community care. It requires a local authority to assess a person's need for community care services(see sections 46 and 47 of the 1990 Act). Where a local authority considers that a person needs NHS or housing authority services, it is required to involve those authorities in the assessment.

392. When the community care provisions were brought into effect (on 1 April 1993) those already in residential accommodation on 31 March 1993 were excluded from the obligation on local authorities to provide residential accommodation under section 21 of the 1948 Act (except in circumstances set out in regulations) (see section 26A of the 1990 Act.) Instead, those people already in residential accommodation on 1 April 1993, retained the right to higher rate benefits (the relevant benefits are now income support and jobseeker's allowance). These higher rate benefits were intended to enable people to continue to make their own arrangements for residential accommodation.

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