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Lord Warner: As I explained in our previous debate, a key part of the policy for NHS foundation trusts is that they have operational freedom and are free from direction from Whitehall. However, it is equally important that these trusts remain fully a part of the NHS and that their actions continue to be in the interests of the wider NHS. So I can well understand the thinking behind the noble Lords' amendments.

We have decided to tackle this issue through a mechanism whereby the independent regulator should be required to exercise his functions in a manner that is consistent with the Secretary of State's performance of his general duties under the 1977 Act, including his duties to promote and provide a comprehensive health service in England and to provide clinical facilities to universities with medical or dental skills. The Bill, as drafted, achieves that. For reasons which I shall

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explain in more detail, these amendments are largely unnecessary and in one case inappropriate and may actually achieve an objective which the noble Lord does not intend.

Perhaps I may take them in some kind of order. Amendment No. 115, which deals with changing the general duty, introduces a requirement to act, "in pursuance" to the Secretary of State's performance of those duties. The duties imposed by Sections 1 and 3 of the 1977 Act should be overriding ones because they will help to ensure that the NHS remains an integrated, coherent and effective national service.

The Secretary of State retains overall responsibility for the NHS. It is right that he should determine the broad direction of travel. It is therefore important that the independent regulator and the Secretary of State should work in an integrated fashion, but without the Secretary of State giving directions to the regulator. However, it would not be appropriate, as I have suggested, for the Secretary of State to have even a backdoor power of direction over the regulator. For a Minister to say that may reassure some Members of the Committee.

I ask the noble Lord to rethink the issue. He might find that his amendment may give the Secretary of State an effective power of direction when the regulator is not operating in pursuance of the Secretary of State's performance of his duties. That duty placed on the regulator means that he should strike the right balance between ensuring consistency with the requirements for the NHS as a whole and retaining his independence. We believe that Clause 3, as currently drafted, achieves that. The independent regulator will be required to take account of the wider interests of the NHS by ensuring that he acts consistently with how the Secretary of State will achieve his duties under the NHS, but it is for the regulator to determine how to achieve that.

The Government's view is that the inclusion of the words, "pursuance of" instead of "consistent with" the performance of the Secretary of State's duties removes the regulator's discretion to determine what is or is not consistent with the Secretary of State's policies. The regulator could be required to comply with the Secretary of State's interpretation of his duties, which effectively amounts to a power of direction and undermines his independence. I have tried to say that to the noble Lord as helpfully as I can.

Amendment No. 112 is on the protection of training. We absolutely agree with the spirit of the amendment: it is vital that education and training continues with NHS foundation trusts. However, the Bill includes ample provision to ensure that this is the case. First, under Clause 3, the regulator is required to exercise his functions in a manner consistent with the Secretary of State's duties under the 1977 Act, including the duty in relation to university clinical teaching.

In addition, under Clause 14, an NHS foundation trust's authorisation must authorise it and may require it to provide education and training and to carry out health-related research. For example, foundation

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trusts will be expected to provide clinical learning opportunities and placements for nursing, medical and dental students, cadets and staff undertaking National Vocational Qualifications, post-graduate training for junior, medical and dental staff and placements for pre-registration students in the other health professions. The specific contributions of individual NHS foundation trusts would be negotiated through local workforce development confederations. The amendment is therefore unnecessary.

I turn to Amendment No. 115 dealing with fairness and universal coverage. These requirements are superfluous to the Secretary of State's duties already established under Sections 1, 3 and 51 of the National Health Service Act 1977. These require the Secretary of State to provide a comprehensive health service which is free of charge and to make provision for clinical training and research. The principles of fairness and universality are therefore fully established. Again, the amendment is unnecessary.

Amendment No. 7 deals with the exercise of powers. This new clause should also be rejected. Only the Secretary of State has the power needed to secure the advancement of the health of the population as a whole and to ensure that there is a comprehensive health service free at the point of delivery. He sets the policy and provides the funding for the NHS as a whole. The duties in the NHS Act 1977 already provide for the advancement of health and for the provision of a comprehensive service free at the point of delivery.

There are also provisions in the Bill that will ensure that the independent regulator and NHS foundation trusts must act in support of these aims. The independent regulator's duty under Clause 3 means that he must ensure there is a comprehensive delivery of care and that NHS foundation trusts are as fully integrated as possible. NHS foundation trusts are themselves under a duty to act in co-operation with other NHS bodies as a result of Clause 29. The noble Lord, Lord Clement-Jones, raised that particular issue, which he will find covered in Clause 29.

Paragraph 25 of Schedule 4 places NHS foundation trusts under a duty to work in co-operation with local authorities. They also have powers to work jointly with local authorities. That will ensure that they continue to be fully integrated with the local health economy, including social care. There is nothing in the Bill which will allow NHS foundation trusts to change the fact that NHS patients receive care that is free at the point of use and delivered on the basis of need, and not on the ability to pay. The Bill also states that public and patient constituency members will elect representatives to the board of governors to represent the interests of the various stakeholders. Taken together, all the provisions outlined make this group of amendments unnecessary.

Lord Clement-Jones: I thank the Minister for his comprehensive gallop through the appropriate legislation incorporated, as he says, into the Bill. That was a very interesting overview. Obviously, the Minister is extremely confident that foundation trusts

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are carefully bolted into the NHS and the 1977 Act. However, few observers share his confidence. Obviously, he believes that the Bill achieves the bringing of foundation trusts within the general principles of the NHS. The argument that Amendment No. 115 could be counter-productive demonstrates that there are very sophisticated minds at work in the Department of Health as to how there could be a back-door way of getting the regulator to conform to the Secretary of State's policy. Be that as it may, I shall examine what he said in Hansard and decide whether I agree.

I accept the Minister's reassurance regarding Amendment No. 112. There is ample reference in the Bill to protect university teaching. It seems that there is that reassurance to insist research takes place, particularly in Clause 14. Integration with the local health economy is precisely the area where we harbour the greatest doubts: I suspect that that is where further argument will arise. In the mean time, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 [NHS foundation trusts]:

5.15 p.m.

Earl Howe moved Amendment No. 8:

    Page 1, line 7, leave out "England" and insert "the United Kingdom"

The noble Lord said: In moving Amendment No. 8, I shall speak also to Amendment No. 160. This is a probing amendment designed to address a straightforward but serious concern about the Bill as drafted. Would people in areas of Wales, such as Powys, who are reliant on English hospitals for their acute services, still have access to those services if the hospital they tended to use became a foundation trust?

Last year, some 43,000 Welsh patients were treated in English hospitals. Some English hospitals, such as those in Chester, Shrewsbury and Hereford, are the prime point of referral for many Welsh residents. Under Clause 14, foundation trusts will be required to provide,

    "goods and services for the purposes of the health service in England".

However, there is no equivalent requirement relating to patients from Wales or Scotland. As regards Welsh patients, we are led to believe that it will be a matter for negotiation between the commissioning body in Wales and the foundation trust. I question whether that provides sufficient comfort to those potentially affected. Given the commercial imperatives under which foundation trusts will be operating, there is a worry on the part of many people, including the BMA, that Welsh patients may no longer be able to access services in England as they have in the past or may be able to do so only at a disproportionate cost to the Welsh commissioning bodies.

We cannot turn the clock back on devolution and health is a devolved matter. Nevertheless, all of us—English, Welsh or Scots—like to regard the NHS as a national and not a regional service. British nationals should have equal access to treatment, no matter

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where they live in the country. The same concern applies to patients who travel to England from other parts of the UK to receive specialist care in national centres of excellence. I hope that the Minister can resolve these concerns in a satisfactory way. If, for some reason, my amendments are not acceptable, I hope that he may be able to suggest alternatives that are. I beg to move.

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