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Lord McColl of Dulwich: I thank the Minister for that. I think perhaps we need to redraft the amendment and make it clearer. That was our fault. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Earl Howe moved Amendment No. 58:

Page 6, line 11, at end insert--
("( ) An order under subsection (1) shall specifically exclude from appointment--
(a) any persons currently serving a term of office as a local authority representative, or
(b) any persons holding a contract of remuneration with any political party."").

The noble Earl said: In moving Amendment No. 58, I should like to speak also to Amendment No. 59.

There are two schools of thought about allowing overtly political appointees to serve on health boards, whether NHS trusts or PCTs. One is what I believe to be the Government's school of thought; that is, that the more local councillors who are appointed, the more "representative" the board is of the area it covers. The other point of view, which I hold, is the opposite; that is, that the politicisation of healthcare is inherently bad.

There is also a view, which I have heard the Labour Party articulate, that having local councillors on a trust board confers on it an additional democratic legitimacy. We heard a similar view put forward earlier today by the noble Lord, Lord Clement-Jones. I disagree with the whole premise underlying that view. What matters on any board is that it is properly accountable in practice to those it serves--and accountable within the NHS structure. A PCT board will be accountable to patients in terms of the way in which its services are delivered, but it will also be accountable to its health authority and ultimately to the Secretary of State for its overall performance and for the manner in which money is spent.

I believe very firmly that we should not confuse representation with accountability. Transparency can be achieved without introducing a spurious democratic underpinning. A trust is not a local authority. I shall be very glad to hear the Minister's comments on that.

The Department of Health's circular of 19th February spoke of the Government wanting PCTs to be,

"Hear, hear" to that, but it by no means follows that serving local authority representatives are the people best placed to articulate local views. I would rather exclude local councillors altogether and anyone in the pay of any political party.

I do not want to introduce any sour note into the sweetness and light of this Committee, but I am sorry to say that in the past we have seen very clearly how the Government have succeeded in engineering the

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balance of political appointments on NHS trust boards in favour of the Labour Party. The statistics published a year ago relating specifically to local councillors showed that 84 per cent. were Labour; 3 per cent. Conservative, and 11 per cent. Liberal Democrat. However, it is not only the party imbalance that is offensive--although it is--it is the fact that the boards are being politicised. A non-executive director of a board should be chosen for his or her ability to make a contribution to that board and not for his or her political credentials. We need checks and balances in the system. Under the current proposals, the Secretary of State will appoint the chairmen and the five lay members of the PCT boards.

In the amendments I propose that appointments with an overtly political affiliation should be eschewed and that the Nolan rules should also apply as a further safeguard to bring the appointments into line with others in the public sector. I have also suggested that the Commissioner for Public Appointments should, for the first time, have the power to revoke any appointment in any case where there has been a breach of the rules on openness and accountability. I beg to move.

Baroness Sharp of Guildford: I rise to support Amendment No. 59, but to oppose Amendment No. 58. On these Benches, we believe that there is no reason why the Government should exclude from membership of a board of trustees those with a political affiliation who are serving in public office or those who are serving their party in an official capacity. It seems to us that many such people can serve as trustees extremely well. They should not be discriminated against in this way. However, we support the Opposition in Amendment No. 59 because we believe that it is right that the Nolan principles should apply here.

Lord Warner: I rise to oppose Amendments Nos. 58 and 59. Amendment No. 58 seems an unreasonable infringement of people's civic rights. It has nothing to do with political appointments. I recognise that Conservative Party headquarters has the winds of McKinseyism sweeping through it and there may be fewer people available to them from those sources to fill these appointments in the future. However, I would still defend their right to be eligible for appointment in the same way as I think members of local authorities, if they are suitable people, should be available for appointment. I suggest that the restriction on local authority members is totally inconsistent with Clauses 19 to 25 of the Bill and the encouragement of partnership between local authorities and the NHS.

On Amendment No. 59, I am mildly surprised at the source from which it is being moved. If this amendment had been in place pre-1997, I can think of a large number of people who would have made representations to the commissioner for public appointments, suggesting that he reviewed those appointments. I seem to recall that a Member of this House (who is not present) when she was a junior Minister went on public record as never having knowingly appointed a member of the Labour Party to a public body. We need to be a little careful in

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our approach and I suggest that we abide by the long-standing tradition of accepting appointments by Ministers as being in the public interest.

10.30 p.m.

Baroness Gardner of Parkes: When it is implied that political appointments should be made all one way or all the other, that really began with the Wilson government: that was the very beginning. Until that time there was a fairly even balance of parties on all health authorities. I remember clearly that Lady Petrie, who had served absolutely outstandingly for many years, was heartbroken when she was put off whatever board she was on on a purely political basis. It was from that day on that when the government next changed, they did what the previous Labour government had done. This bad policy came from that time. It is now time that we started being more fair and appointed everyone on their merits, and only on their merits. This amendment, which says that it should be possible to remove someone if the Nolan standards are not being complied with, contains a desirable principle, because there are occasions when someone may have been appointed under false pretences. This would then be a protection.

Baroness Hayman: I am in a dilemma. I could enter into the general debate on the appropriateness of those who are members of local authorities serving on the boards of primary care trusts. That has been the thrust of the contributions that have been made so far. But it would be wrong of me not to remind the Committee that these amendments--and we are having the same problems here as we had with the one before--apply not to the members of the boards of primary care trusts but simply to the trustees of any charitable funds that are held by the primary care trusts. That is why I was somewhat bemused earlier. Now I understand what the problem is.

Clause 5(1) deals with trust funds and trustees, not with the membership of boards; and so I am not going to be tempted into argument over political balance. What I would like to make clear is our belief that it would be wrong to disqualify local councillors from membership of trust boards to which membership does not apply and even more wrong to disqualify them from being a charitable trustee, to which the amendment actually does apply. There are sufficient safeguards in charity law to protect the interests of donors to those charities and to exclude people who have particular criminal convictions, who are undischarged bankrupts, who have previously been removed from a trusteeship or who are under a company director disqualification order. Charity law imposes strict obligations on trustees to apply funds solely for the purposes specified by donors.

However, perhaps I may respond to the general issue. My right honourable friend the Secretary of State for Health has already made absolutely clear that all public appointments made by him or on his behalf will be made in accordance with the key principles laid down by the Commissioner for Public Appointments. That commitment will also apply to the appointment of charitable trustees.

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We do want the process of appointing the members of primary care trust boards to be subject to those Nolan procedures. As with other NHS appointments, the posts will be advertised and made after a selection process involving an independent person on the board. Regional chairmen will then make recommendations to the Secretary of State.

The clear responsibility set out by the Commissioner for Public Appointments is that the ultimate responsibility for appointments rests with Ministers. That is why we do not believe, either in the specific of charitable trustees or in the general, that we should extend the powers of the Commissioner for Public Appointments so that he could overrule the Secretary of State. It is right that a decision made by the Secretary of State should not be revoked at the discretion of another individual. There are procedures of judicial review already in place to ensure that Secretaries of State use their powers properly. Moreover, in circumstances like those outlined by the noble Baroness, Lady Gardner, where something totally inappropriate and against the Nolan procedures inadvertently happened, I am sure that the Secretary of State would wish to remove that person from membership.

However, some good has perhaps inadvertently come out of this misunderstanding. As I said, it is our intention that all public appointments made by the Secretary of State, or on his behalf, should be made in accordance with the key principles laid down by the Commissioner for Public Appointments. That will include appointments to PCTs as well as to the bodies of charitable trustees. Therefore, I can tell the Committee that we are going to take appropriate steps to ensure that these bodies are added to the list of bodies which, by Order in Council, fall within the jurisdiction of the Commissioner for Public Appointments. So perhaps we will have added a extra layer of safeguard for the trustees of charitable funds in the course of our debates tonight.

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