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Health and Social Care (Community Health and Standards) Bill


Health and Social Care (Community Health and Standards) Bill
Schedule 1 — Constitution of public benefit corporations

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Schedules

Schedule 1

Section 1

 

Constitution of public benefit corporations

Requirement for a constitution

  1       (1)      A public benefit corporation is to have a constitution.

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          (2)      As well as any provision authorised or required to be made by this Schedule,

the constitution may make further provision (other than provision as to the

powers of the corporation) consistent with this Schedule.

  2        The constitution is to name the corporation and, if the corporation is an NHS

foundation trust, its name must include the words “NHS foundation trust”.

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Members

  3       (1)      The members of a public benefit corporation are to be individuals who—

              (a)             live in the area specified for the purpose in the constitution (“the

public constituency”), or

              (b)             are employed by the corporation under a contract of employment

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(“the staff constituency”).

          (2)               The area specified under sub-paragraph (1)(a) must be an electoral area for

the purposes of local government elections in England or an area consisting

of two or more such electoral areas.

          (3)      The constitution may also provide for the public constituency to comprise

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individuals who have attended any of the corporation’s hospitals as patients

(including individuals attending as the carer of a patient).

          (4)               The constitution may also provide for the staff constituency to comprise

individuals who exercise functions for the purposes of the corporation

otherwise than under a contract of employment with the corporation.

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          (5)               A person may become or continue as a member of the staff constituency only

if—

              (a)             he is employed by the corporation under a contract of employment

which has no fixed term or has a fixed term of at least 12 months, or

              (b)             he has been continuously employed by the corporation for at least 12

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months or, where sub-paragraph (4) applies, he has continuously

exercised functions for the purposes of the corporation for such a

period.

          (6)               A person eligible for membership of the staff constituency may not become

or continue as a member of the public constituency.

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          (7)               Chapter 1 of Part 14 of the Employment Rights Act 1996 (c. 18) applies for

the purpose of determining whether an individual has been continuously

 

 

Health and Social Care (Community Health and Standards) Bill
Schedule 1 — Constitution of public benefit corporations

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employed by the corporation, or has continuously exercised functions for

the purposes of the corporation, as it applies for the purposes of that Act.

  4        The constitution is to require a minimum number of members of each

constituency.

  5       (1)      A person may become a member of a public benefit corporation on an

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application made to the corporation.

          (2)      The constitution may make further provision as to the circumstances in

which a person may not become or continue as a member.

Board of Governors

  6       (1)      A public benefit corporation is to have a board of governors.

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          (2)               Only members of the corporation and persons appointed under the

following provisions may become or continue as members of the board.

          (3)      The members of the board other than the appointed members are to be

chosen by election.

          (4)      Members of the public constituency or the staff constituency may elect any

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of their number to be a member of the board.

          (5)      If contested, the election must be by secret ballot using an electoral system

to be specified in regulations made by the Secretary of State.

  7       (1)                                                   The following may not become or continue as members of the board of

governors—

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              (a)             a person who has been adjudged bankrupt or whose estate has been

sequestrated and (in either case) has not been discharged,

              (b)             a person who has made a composition or arrangement with, or

granted a trust deed for, his creditors and has not been discharged in

respect of it,

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              (c)             a person who within the preceding five years has been convicted in

the British Islands of any offence if a sentence of imprisonment

(whether suspended or not) for a period of not less than three

months (without the option of a fine) was imposed on him.

          (2)                        The constitution may make further provision as to the circumstances in

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which a person may not become or continue as a member of the board.

  8       (1)      More than half of the members of the board of governors are to be elected by

the public constituency.

          (2)      At least one member of the board is to be elected by the staff constituency.

          (3)      At least one member of the board is to be appointed by a Primary Care Trust

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for which the corporation provides goods or services.

          (4)      At least one member of the board is to be appointed by one or more

qualifying local authorities.

  A qualifying local authority is a local authority for an area which includes

the whole or part of the area specified under paragraph 3(1)(a).

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          (5)      If any of the corporation’s hospitals includes a medical or dental school

provided by a university, at least one member of the board is to be appointed

by that university.

          (6)               An organisation specified in the constitution as a partnership organisation

may appoint a member of the board.

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Health and Social Care (Community Health and Standards) Bill
Schedule 1 — Constitution of public benefit corporations

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  9       (1)      A member of the board of governors elected by the public constituency or

the staff constituency may hold office for a period of three years.

          (2)      Such a member is to be eligible for re-election at the end of that period.

          (3)      But a person elected to membership of the board ceases to hold office if he

ceases to be a member of the relevant constituency.

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  10       The corporation may pay travelling and other expenses to members of the

board of governors at rates decided by the corporation.

  11       The constitution is to provide for the chairman of the corporation or (in his

absence) another person to preside at meetings of the board of governors.

  12      (1)      The constitution is to provide for meetings of the board of governors to be

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open to members of the public.

          (2)      But the constitution may provide for members of the public to be excluded

from a meeting for special reasons.

  13      (1)      The constitution is to make provision as to—

              (a)             the conduct of elections for membership of the board,

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              (b)             the appointment of persons to membership,

              (c)             the practice and procedure of the board,

              (d)             the removal of a member from office.

          (2)      The constitution may make further provision about the board.

Directors

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  14      (1)      A public benefit corporation is to have a board of directors.

          (2)      The constitution is to provide for all the powers of the corporation to be

exercisable by the board of directors on its behalf.

          (3)      But the constitution may provide for any of those powers to be delegated to

a committee of directors or to an executive director.

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  15      (1)      The board is to consist of—

              (a)             executive directors, one of whom is to be the chief executive and

another the finance director,

              (b)             non-executive directors, one of whom is to be the chairman.

          (2)               A person may not be appointed as an executive director if he is within

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paragraph 7(1).

          (3)      A person may be appointed as a non-executive director only if—

              (a)             he is a member of the public constituency, or

              (b)             where any of the corporation’s hospitals includes a medical or dental

school provided by a university, he exercises functions for the

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purposes of that university,

                   and he is not within paragraph 7(1).

  16      (1)      It is for the board of governors at a general meeting to appoint or remove the

chairman and the other non-executive directors.

  Removal of a non-executive director under this sub-paragraph requires

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the approval of three-quarters of the members of the board.

          (2)      It is for the non-executive directors to appoint or remove the chief executive.

 

 

Health and Social Care (Community Health and Standards) Bill
Schedule 1 — Constitution of public benefit corporations

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          (3)      It is for a committee consisting of the chairman, the chief executive and the

other non-executive directors to appoint or remove the executive directors.

          (4)      An appointment or removal under sub-paragraph (2) or (3) requires the

approval of a majority of the board of governors voting at a general meeting.

  17      (1)      It is for the board of governors at a general meeting to decide the

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remuneration and allowances, and the other terms and conditions of office,

of the non-executive directors.

          (2)      The corporation is to establish a committee of non-executive directors to

decide the remuneration and allowances, and the other terms and

conditions of office, of the executive directors; but the constitution may

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make provision for those matters to be decided pending the establishment

of such a committee.

Initial directors of former NHS trusts

  18      (1)      This paragraph applies, where the application for authorisation is made

under section 4, to the exercise of the powers mentioned in paragraph 16 to

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appoint the initial non-executive directors and the initial chief executive.

          (2)               The power to appoint the initial chairman of the corporation is to be

exercised by appointing the chairman of the NHS trust, if he wishes to be

appointed.

          (3)               The power to appoint the other initial non-executive directors of the

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corporation is to be exercised, so far as possible, by appointing any of the

non-executive directors of the NHS trust (other than the chairman) who

wish to be appointed.

          (4)      A person appointed in accordance with sub-paragraph (2) or (3) is to be

appointed for the unexpired period of his term of office as chairman or (as

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the case may be) non-executive director of the NHS trust; but if, on any such

appointment, that period is less than 12 months, he is to be appointed for 12

months.

          (5)               The power to appoint the initial chief executive of the corporation is to be

exercised by appointing the chief officer of the NHS trust, if he wishes to be

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appointed.

          (6)      Paragraph 16(4) does not apply to the appointment of any executive director

of the NHS trust as an initial executive director of the corporation.

Register of members etc.

  19      (1)      A public benefit corporation is to have—

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              (a)             a register of members showing, in respect of each member, the

constituency to which he belongs,

              (b)             a register of members of the board of governors,

              (c)             a register of directors,

              (d)             a register of interests of the directors.

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          (2)      The constitution may make further provision about the registers including,

in particular, admission to, and removal from, the registers.

  20       The constitution is to make provision for dealing with conflicts of interest of

the directors.

 

 

Health and Social Care (Community Health and Standards) Bill
Schedule 1 — Constitution of public benefit corporations

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  21      (1)      The following documents of a public benefit corporation are to be available

for inspection by members of the public free of charge at all reasonable

times—

              (a)             a copy of the current constitution,

              (b)             a copy of the current authorisation,

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              (c)             the registers mentioned in paragraph 19,

              (d)             a copy of the latest annual accounts and of any report of the auditor

on them,

              (e)             a copy of the latest annual report,

              (f)             a copy of the latest information as to its forward planning,

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              (g)             a copy of any notice given under section 23.

          (2)      Any person who requests it is to be provided with a copy of or extract from

any of the above documents.

          (3)      If the person requesting the copy or extract is not a member of the

corporation, the corporation may impose a reasonable charge for doing so.

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Auditor

  22      (1)      A public benefit corporation is to have an auditor.

          (2)      It is for the board of governors to appoint or remove the auditor at a general

meeting of the board.

          (3)      But a person may not be appointed as auditor unless he (or, in the case of a

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firm, each of its members) is a member of one or more of the following

bodies—

              (a)             the bodies mentioned in section 3(7)(a) to (e) of the Audit

Commission Act 1998 (c. 18),

              (b)             any other body of accountants established in the United Kingdom

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and for the time being approved by the regulator for the purposes of

this paragraph.

          (4)      The corporation is to establish a committee of non-executive directors to

monitor the exercise of the auditor’s functions.

Accounts

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  23      (1)      A public benefit corporation is to keep accounts in such form as the regulator

may with the approval of the Treasury direct.

          (2)      The accounts are to be audited by the corporation’s auditor.

          (3)      But the Comptroller and Auditor General may examine—

              (a)             the accounts,

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              (b)             any records relating to them, and

              (c)             any report of the auditor on them.

          (4)      In auditing the accounts the auditor is to comply with any directions given

by the regulator as to the standards, procedures and techniques to be

adopted.

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  24      (1)      A public benefit corporation is to prepare in respect of each financial year

annual accounts in such form as the regulator may with the approval of the

Treasury direct.

 

 

Health and Social Care (Community Health and Standards) Bill
Schedule 1 — Constitution of public benefit corporations

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          (2)      In preparing its annual accounts, the corporation is to comply with any

directions given by the regulator with the approval of the Treasury as to—

              (a)             the methods and principles according to which the accounts are to be

prepared,

              (b)             the information to be given in the accounts.

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          (3)      In determining the form and content of the annual accounts the regulator is

to aim to ensure that the accounts present a true and fair view.

          (4)      The corporation must—

              (a)             lay a copy of the annual accounts, and any report of the auditor on

them, before Parliament, and

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              (b)             once it has done so, send copies of those documents to the regulator

and the registrar of companies.

          (5)      In this paragraph and paragraph 26 “financial year” means—

              (a)             the period beginning with the date on which the corporation is

authorised under section 6 and ending with the next 31st March, and

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              (b)             each successive period of twelve months beginning with 1st April.

Annual reports and forward plans

  25      (1)      A public benefit corporation is to prepare annual reports and send them to

the regulator and the registrar of companies.

          (2)      The reports are to give—

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              (a)             information on any steps taken by the corporation to secure that

(taken as a whole) the actual membership of its public constituency

is representative of those eligible for such membership,

              (b)             any other information the regulator requires.

          (3)      It is for the regulator to decide—

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              (a)             the form of the reports,

              (b)             when the reports are to be sent to him,

              (c)             the periods to which the reports are to relate.

  26      (1)      A public benefit corporation is to give information as to its forward planning

in respect of each financial year to the regulator.

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          (2)      The information is to be prepared by the directors after consulting the board

of governors.

Meeting of board of governors to consider annual accounts and reports

  27       The following documents are to be presented to the board of governors of a

public benefit corporation at a general meeting—

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              (a)             the annual accounts,

              (b)             any report of the auditor on them,

              (c)             the annual report.

Instruments etc.

  28      (1)      The constitution is to make provision for the authentication of the fixing of

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the corporation’s seal.

 

 

Health and Social Care (Community Health and Standards) Bill
Schedule 2 — Independent Regulator of NHS Foundation Trusts

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          (2)      A document purporting to be duly executed under the corporation’s seal or

to be signed on its behalf is to be received in evidence and, unless the

contrary is proved, taken to be so executed or signed.

Schedule 2

Section 2

 

Independent Regulator of NHS Foundation Trusts

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Regulator’s terms of appointment

  1       (1)      The regulator holds office for the period determined by the Secretary of State

on his appointment (or re-appointment) to the office.

          (2)      But—

              (a)             the regulator may at any time resign his office by giving notice to the

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Secretary of State,

              (b)             the Secretary of State may at any time remove him from office on the

ground of incapacity or misbehaviour.

          (3)      Subject to that, the regulator holds and vacates office on the terms

determined by the Secretary of State.

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Remuneration and pensions

  2       (1)      The Secretary of State is to pay to the regulator—

              (a)             such remuneration, and

              (b)             such travelling and other allowances,

                   as the Secretary of State may determine.

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          (2)      In the case of any such person who holds or has held office as regulator as

the Secretary of State may determine, the Secretary of State is to pay—

              (a)             such pension, allowance or gratuity to or in respect of him, or

              (b)             such contributions or payments towards provision for such a

pension, allowance or gratuity,

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                   as the Secretary of State may determine.

Staff

  3       (1)      The regulator may, after consulting the Minister for the Civil Service as to

numbers and terms and conditions of service, appoint such staff as the

regulator may determine.

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          (2)      The members of staff must include a deputy to the regulator who is to act as

regulator—

              (a)             during any vacancy in that office, or

              (b)             if the regulator is absent, subject to suspension or unable to act.

          (3)      Sub-paragraph (4) applies where—

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              (a)             a person is a participant in a scheme under section 1 of the

Superannuation Act 1972 (c. 11), and

              (b)             he is appointed as regulator.

          (4)      In such a case the Minister for the Civil Service may determine that the

person’s term of office as regulator is to be treated for the purposes of the

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