Clause by clause commentary
PART I: THE NATIONAL HEALTH SERVICE
CLAUSE 1: REPEAL OF LAW ABOUT FUND-HOLDING PRACTICES
49. Clause 1 contains no delegated powers. It
simply repeals the provisions in the 1990 Act about GP fund-holding.
The transitional arrangements will be made by orders under clause
49, and in general these will be subject to negative procedure.
Orders which contain only provision about transfer of property,
rights and liabilities, will be statutory instruments not subject
to any Parliamentary procedure. This approach is in line with
the provisions made during other changes to the way in which the
health service is run, for example the abolition of Regional and
District Health Authorities in the Health Authorities Act 1995.
The transitional provisions will be detailed and cover arrangements
for closing the fund-holding accounts of residual fund-holders,
the transfer of those assets, rights and liabilities that need
to be transferred to the Health Authority, and any provision for
those that are to remain with the former fund-holders.
CLAUSE 2: PRIMARY CARE TRUSTS
50. Clause 2 inserts sections 16A and 16B into
the National Health Service Act 1977, which contain three delegated
powers. The clause also gives effect to a number of delegated
powers contained within Schedule 1, which inserts Schedule 5A
into the 1977 Act.
51. Section 16A(2) allows the Secretary
of State to establish Primary Care Trusts by order. These are
new NHS bodies that will exercise functions delegated to them
by Health Authorities, and will in some cases take on the provision
of health care services currently provided by NHS trusts. There
will be a separate order for each Primary Care Trust, and the
Bill provides that they will be made as statutory instruments,
mirroring the approach taken for Health Authorities and NHS trusts,
set out in section 8 of the 1977 Act and section 5 of the 1990
Act respectively. The Secretary of State will have discretion
as to whether to establish a Primary Care Trust. It is not proposed
that Primary Care Trusts will cover the entire country from commencement
of the Bill provisions relating to Trusts. Individual Primary
Care Trusts will be established at various different times, as
thought appropriate in the light of local circumstances.
52. Paragraphs 1 to 4 of the new Schedule 5A
to the 1977 Act, inserted by Schedule 1 to the Bill, set out the
matters that must or may be dealt with in such an order. The order
will specify the area for which the Trust is established, and
limitations on the functions it may exercise. It will also set
out the name of the Trust and the date it will become operational.
Although there will be a degree of commonality between orders,
the exact provisions which they will contain may vary according
to local circumstances and may need to be altered from time to
53. Although the functions of Primary Care Trusts
will be largely set out in directions (see clause 7), it is proposed
that each order will set out whether the Trust is able to provide
services itself, or is simply able to meet its responsibilities
by arranging for another person or body to provide the necessary
services (eg an NHS trust). The distinction must be set out in
detail, with such modifications or exceptions as are appropriate,
either generally, or in an individual case. To provide for such
matters on the face of the Bill would involve a great deal of
detailed provision, and may possibly impose unnecessary constraints
on the activities of Primary Care Trusts, which could then only
be removed by primary legislation. In addition, as well as being
able to detail the particular restrictions which apply to each
Primary Care Trust, the Department requires a power to lift a
restriction on the provision of services where this becomes appropriate
in an individual case. Other new limitations may need to be imposed,
or existing ones modified. The Department considers that these
factors all point to such matters being dealt with in the establishment
order, rather than in primary legislation.
54. As for the geographical areas of Primary
Care Trusts, these will all be different and will be specifically
tailored to what is considered appropriate for the individual
case. It may be necessary to alter the area of a Primary Care
Trust from time to time to align their boundaries with future
changes to Health Authority or local authority boundaries, or
to reflect future local re-configurations of NHS services. The
Department therefore considers it inappropriate to set out Primary
Care Trust areas in primary legislation.
55. Similarly, the establishment order will contain
provisions for the "preparatory period" of each Primary
Care Trust. These provisions will concern matters of detail that
the Department does not consider appropriate for primary legislation.
56. The orders establishing Primary Care Trusts
will be statutory instruments, but will not be subject to any
Parliamentary procedure. The Department considers that it would
not be practical for Parliament to scrutinise each and every order.
As a statutory instrument each order will however be subject to
scrutiny by the Joint Committee on Statutory Instruments. The
same procedure applies to the orders establishing NHS trusts -
see section 5 and paragraph 1(2) of Schedule 2 to the 1990 Act.
57. Section 16A(5) enables the Secretary
of State to make regulations containing the consultation requirements
that must be complied with before a PCT order is made. Comparable
arrangements for orders establishing NHS trusts are set out in
section 5(2) of the 1990 Act. The regulations will need
to deal with such matters as who must conduct the consultation,
who must be consulted, and the details of the procedure which
must be followed. The regulations will be subject to negative
58. Regulations avoid placing a large amount
of procedural and administrative detail on the face of the Bill.
They allow flexibility for the consultation procedures to develop
and change over time. They also reflect the fact that different
bodies may need to be consulted for different Primary Care Trusts,
depending on the functions it is proposed they exercise.
59. Section 16B(2) enables the Secretary
of State to make regulations about the joint exercise of functions
with another NHS body, or exercise of functions on the Primary
Care Trust's behalf. The provisions are similar to those made
for Health Authorities in section 16 of the 1977 Act. Such regulations
will enable Primary Care Trusts to enter into "agency"
arrangements under which another Primary Care Trust may perform
its functions if that is the most efficient or convenient way
for the function to be exercised, without removing the original
Trust's ultimate responsibility for such exercise. In addition
they will enable a Primary Care Trust to make appropriate arrangements
for the internal delegation of functions to its committees or
officers. The regulations may therefore deal with matters of administrative
detail that would not be appropriate for primary legislation.
Furthermore, these regulations provide flexibility for the provisions
to change as Primary Care Trusts develop. As with those made under
section 16 they will be subject to negative resolution procedure.
60. Subsection (1) provides that the regulations
under section 16B may provide for functions under the Bill, the
1977 Act, and the 1990 Act, to be exercisable on behalf of a Primary
Care Trust. There may however be additional statutory functions
for which it may be desirable to make similar provision. Subsection
(1) therefore provides that the Secretary of State may prescribe
in regulations the other statutory functions to which section
16B may apply.