Select Committee on Delegated Powers and Deregulation Seventh Report



ANNEX

HEALTH BILL [HL]

Memorandum by the Department of Health

Introduction

1.  The Health Bill was first read in the House of Lords on 28 January 1999. This memorandum summarises the main provisions of the Bill and gives an overview of the delegated powers. It then identifies each of the powers; describes its purpose; explains why the matter has been left to delegated legislation; and explains the degree of parliamentary control provided.

Main provisions

31.  The Health Bill contains 54 clauses and 5 schedules. Its main purpose is to change the way in which the National Health Service is run in England, Scotland and Wales. The main strands of the Bill, which apply to all three countries unless otherwise stated, are to:

    (i)  abolish GP fundholding, and make provision for the establishment of new Primary Care Trusts in England and Wales, and for NHS trusts in Scotland to take on additional functions

    (ii)  amend the legislative framework of NHS trusts

    (iii)  provide for new arrangements aimed at improving the quality of care provided to patients receiving NHS services, including the establishment of the Commission for Health Improvement for England and Wales, which will help drive up the quality of care provided by the NHS

    (iv)  provide for new duties of partnership within the NHS and between NHS bodies and Local Authorities in England and Wales, and local strategies to be developed for improving health and health care. It also provides for new operational flexibilities to allow NHS bodies and local authorities to enter into joint arrangements for the purchase of provision of health and health-related services

    (v)  introduce measures designed to tackle fraud against the NHS

    (vi)  provide for the Secretary of State to make regulations and directions to secure compliance with aspects of a negotiated pharmaceutical price regulation scheme, to regulate the profits of companies outside the negotiated agreement and to set maximum prices for medicines supplied to the NHS

    (vii)  enable Her Majesty to regulate health care professions by Order in Council

32.  The Explanatory Notes, which were published on 2 February 1999, provide detailed information about the background to these provisions, their purpose and effect.

Overview of the delegated powers

33.  By the Department's reckoning the Health Bill provides for 54 powers in 23 clauses and 4 schedules to make orders, regulations and directions. Paragraphs 5-11 of this memorandum set out a general rationale for the conferral of delegated powers in the Bill. The type of Parliamentary scrutiny is then considered in paragraphs 12-19.

The rationale for delegated powers in the Health Bill

34.  In considering whether matters should be specified on the face of the Bill or left to delegated legislation, the Department has weighed the importance of the matter against the need to:

    (viii)  avoid too much technical and administrative detail, and keep the Bill shorter than it would otherwise be

    (ix)  ensure flexibility in responding to changing circumstances, and a measure of ability to make changes quickly in the light of experience without the need for primary legislation

    (x)  allow detailed administrative arrangements to be set up and kept up to date within the basic structures and principles set out in the primary legislation, subject to Parliament's right to challenge inappropriate use of powers

    (xi)  allow flexible timing to get legislation right, to consult, and change it when circumstances change.

35.  A further important consideration has been the existing legislative structure for the National Health Service. Much of the Bill consists of modifications or additions to that structure. The delegated powers conferred by the Bill should be seen in this light. The Committee may find the following outline of the structure helpful.

36.  The legislative framework is set out in the National Health Service Act 1977 ("the 1977 Act"), as respects England and Wales, and the National Health Service Act 1978, as respects Scotland ("the 1978 Act"). These Acts are supplemented, in particular, by the National Health Service and Community Care Act 1990 ("the 1990 Act") and the National Health Service (Primary Care) Act 1997 ("the Primary Care Act").

37.  There are essentially two systems under the 1977 Act. The 1978 Act is broadly similar, and the following description also applies to Scotland, with references to the 1977 Act to be read as references to the 1978 Act. The first system is set out in Part I, and concerns the provision of health care in hospitals. It also covers services which are described as "community health services", for example the provision of services by midwives or health visitors. Part I of the Act confers on the Secretary of State the responsibility for providing or securing the provisions of those services. It then provides a structure whereby he delegates these responsibilities to Health Authorities. The actual provision of services is now carried out by NHS trusts, under arrangements made by the Health Authorities.

38.  It is a notable feature of Part I that while the overall framework is set out in the provisions of the Act, there is very little prescription in primary legislation as to what the Secretary of State or NHS bodies must do or indeed how they must do it. The matter is left largely to Secretary of State directions, which may either be given by regulations or by an instrument in writing (the latter not being subject to Parliamentary scrutiny). This system was designed to enable maximum flexibility in the way Part I services are organised, to avoid unnecessary constraints on the NHS, and to limit the technical and administrative detail which appears on the face of the 1977 Act.

39.  The second system, in Part II of the 1977 Act and the 1978 Act, concerns the provision of "family health services". These services are provided "in the high street" by private practitioners, ie general medical practitioners (the family GP), dental practitioners, ophthalmic opticians and chemists, under statutory arrangements made by Health Authorities and Health Boards. The arrangements are administered by Health Authorities in accordance with regulations made under section 15 and Part II of the 1977 Act and equivalent provisions in the 1978 Act. Again the Acts set the broad framework, while the detail is left to secondary legislation. The difference from Part I is that the legislation takes the form of regulations, subject to Parliamentary scrutiny. The Part II system is therefore more regulated, and less flexible than the Part I system.

40.  The National Health Service is a large and complex organisation, which provides services and performs other functions in a variety of different ways. The existing legislation governing the health service is sufficiently flexible to cope with a variety of different circumstances, and the Government does not wish to restrict this flexibility unnecessarily. It would not be possible to deal with every aspect of how the NHS operates, and provide for every eventuality, in primary legislation, without producing legislation of great length, complexity and detail. In addition, such detailed provisions may require frequent changes to deal with changing circumstances. It is with these considerations in mind that the Department has approached the issue of delegated legislation in the Bill.

Type of Parliamentary scrutiny

41.  In considering what type of Parliamentary procedure would be appropriate for each power, the Department has sought to follow established practice. In the context of the NHS, affirmative resolution procedures are thought to be appropriate only in exceptional circumstances. Most of the orders and regulations made under the powers in this Bill are therefore subject to the negative procedure. The Committee will note that many of the provisions of the Bill insert new powers to make orders or regulations into the 1977 or 1978 Acts. Unless provided otherwise, these powers are exercisable by statutory instrument subject to the negative procedure (see section 126 of the 1977 Act and section 105 of the 1978 Act).

Regulations

42.  The Bill provides for any regulations made by the Secretary of State under the provisions of the Bill to be exercisable by statutory instrument subject to negative resolution procedure.

Orders

43.  The Bill provides for a number of orders that will not be subject to Parliamentary scrutiny. The Bill however provides for a number of such orders that will not be subject to Parliamentary procedure (see clause 48(5)). These generally concern matters of detail, where the Department considers that Parliamentary scrutiny would be unnecessary, and reflect existing powers in NHS legislation. For example, the orders to establish each of the new NHS bodies to be known as Primary Care Trusts, or orders which contain only supplementary or consequential provision for the transfer of property rights and liabilities. In addition, the Bill confers a number of powers to make orders that are not statutory instruments. These provisions mirror existing powers in other NHS legislation and deal with the transfer of property, right, liabilities and staff from one NHS body to another.

44.  As is usual, the power to make a Commencement Order (clause 52) is not subject to Parliamentary scrutiny.

45.  The Bill also provides in clause 47 for a power to amend existing primary legislation by order. These orders will be subject to affirmative procedure and are discussed in paragraphs 131-147.

Directions

46.  Much of the detailed provision in relation to the NHS, under Part I of the 1977 Act in particular, is set out in directions made under the Act. The Bill makes changes to the existing system, and in particular provides for new powers of direction in relation to NHS trusts and the new Primary Care Trusts.

47.  Directions will, in particular, confer functions on Health Authorities and Primary Care Trusts and may contain instructions as to how functions are to be exercised by a Health Authority, NHS trust or Primary Care Trust. Directions may also set out the detailed requirements in relation to the strategies for health and health care under clause 21.

48.  Such directions frequently contain matters of operational detail which relate specifically to the bodies directed and they may sometimes be used to give immediate instructions about various matters that may arise from time to time. It is generally not thought appropriate to subject all directions to Parliamentary scrutiny. The 1977 and 1978 Acts, and the Bill itself, therefore provide that directions may be given simply by an instrument in writing, without any Parliamentary procedure. In certain cases however, it is provided that directions may also be given by regulations, subject to the negative resolution procedure, where this is thought appropriate. In addition, the Bill sets out those particular circumstances in which directions must be given by regulations. Paragraphs 51-66 offer a fuller explanation.


 
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