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Lord Warner: My Lords, we never tire of listening to my noble friend Lord Hunt, whether or not he has his anorak on. As regards Amendments Nos. 58 and 67, we have listened. We accept the logic of his position, as supported by the noble Baroness, Lady Hanham. We are prepared to accept both Amendments Nos. 58 and 67.

Lord Hunt of Kings Heath: My Lords, I am most grateful.

On Question, amendment agreed to.

[Amendments Nos. 59 to 65 not moved.]

Lord Warner moved Amendment No. 66:


On Question, amendment agreed to.

Lord Hunt of Kings Heath moved Amendment No. 67:


    Page 112, line 32, leave out from "of" to end of line 33 and insert "the initial chief executive of the corporation in pursuance of sub-paragraph (5)"

On Question, amendment agreed to.

Lord Warner moved Amendment No. 68:


    Page 112, line 38, at end insert—


"( ) a register of interests of the members of the board of governors"

On Question, amendment agreed to.

[Amendments Nos. 69 to 71 not moved.]

Lord Warner moved Amendments Nos. 72 and 73:


    Page 112, line 43, at end insert "the members of the board of governors and of"


    Page 113, line 1, leave out from beginning to "available" and insert "A public benefit corporation is to make the following documents"

On Question, amendments agreed to.

[Amendments Nos. 74 and 75 not moved.]

6 Nov 2003 : Column 975

Lord Warner moved Amendment No. 76:


    Page 113, line 19, at end insert—


"( ) An officer of the Audit Commission may be the auditor if he is appointed by the board with the agreement of the Commission."

On Question, amendment agreed to.

[Amendments Nos. 77 and 78 not moved.]

Lord Warner moved Amendments Nos. 79 and 80:


    Page 113, line 27, at end insert—


"( ) Where an officer of the Audit Commission is appointed as auditor, the Commission is to charge the public benefit corporation such fees for his services as will cover the full cost of providing them." Page 113, line 28, leave out from "directors" to end of line 29 and insert "as an audit committee to perform such monitoring, reviewing and other functions as are appropriate"

On Question, amendments agreed to.

[Amendment No. 81 not moved.]

Lord Warner moved Amendment No. 82:


    Page 113, line 29, at end insert—


"( ) In this paragraph "the Audit Commission" means the Audit Commission for Local Authorities and the National Health Service in England and Wales."

On Question, amendment agreed to.

[Amendments Nos. 83 to 85 not moved.]

Lord Warner moved Amendments Nos. 86 to 88:


    Page 114, leave out line 12.


    Page 114, line 12, at end insert—


"( ) The constitution is to provide for the functions of the corporation under this paragraph to be delegated to the accounting officer." Page 114, line 19, leave out "and the registrar of companies"

On Question, amendments agreed to.

[Amendment No. 89 not moved.]

Lord Warner moved Amendment No. 90:


    Page 114, line 22, leave out "its public constituency" and insert "any public constituency and (if there is one) of the patients' constituency"

On Question, amendment agreed to.

Lord Warner moved Amendment No. 91:


    Page 114, line 27, leave out "him" and insert "it"

The noble Lord said: My Lords, in moving Amendment No. 91, I shall speak also to the raft of amendments grouped with it. We have listened carefully to the arguments put forward in another place and in Committee here in support of the establishment of the office of the independent regulator with a board structure rather than as a single office-holder. I made a commitment at the previous stage that, if the Better Regulation Task Force report on independent regulators recommended that a board structure was appropriate for that type of regulator, I would bring forward on Report suitable amendments to take account of the recommendations of the task force.

6 Nov 2003 : Column 976

I am now honouring that commitment in the amendments grouped here to that effect. Noble Lords may be alarmed at the number of amendments required to achieve this, but I can give an assurance that the majority are simple consequential amendments that arise from changing the regulator from an individual to a body corporate with a board structure.

Some noteworthy changes are contained in Amendment No. 106, which sets out that the independent regulator must consist of a board of up to five members, including a chair and a deputy. The general and specific powers of the independent regulator are set out in Amendment No. 119, and the accounting requirements are set out in Amendment No. 128. Given that the government amendments have the desired effect of Amendments Nos. 99 and 103, I hope that the noble Earl will not press his amendments. I beg to move.

Earl Howe: My Lords, I begin by thanking the Minister for taking on board the proposals advanced by myself and others in Committee and which were first mooted in another place. His amendments are welcome for all the reasons that we debated.

Perhaps I may pick up one issue only from our Committee proceedings: why are the Government insisting on not delegating to the NHS Appointments Commission the appointment of the regulator on first establishment? The Minister said that he envisaged that only a small proportion of national appointments would be made directly by the Secretary of State. Why should this be one of them? I wonder what that says to the outside world about the qualifications for the role of the regulator or, as he is described, the chairman of the board. The manner of appointment does not look good from that perspective. We need to know exactly why the NHS Appointments Commission, which was created expressly to avoid the suspicion or, indeed, the reality of any political bias, should not be tasked with that important appointment.

Lord Clement-Jones: My Lords, I add my thanks to the Minister for responding to the amendments tabled in Committee seeking to appoint a board rather than an individual regulator and for accepting the reasons that were put forward, along with the recommendations of the Better Regulation Task Force.

I wish simply to supplement what was said by the noble Earl, Lord Howe, as regards the NHS Appointments Commission. Even if, in the view of the Government, the chairman has to be appointed by the Secretary of State, there is no reason why the other members of the board should be so appointed. Members on these Benches feel that all members of the board should be appointed by the NHS Appointments Commission, which would be open, transparent and the correct way to proceed. However, if there has to be an element of shying away from that position, then the Minister could at least undertake to consider whether members of the board other than the chairman should be appointed by the NHS Appointments Commission.

6 Nov 2003 : Column 977

Lord Warner: My Lords, I am grateful to noble Lords for that positive response. It is the Government's intention that the Secretary of State shall appoint the regulator on first establishment. Further, noble Lords are probably aware that the appointment process is well under way, which is a consideration.

In the future, the Secretary of State may delegate the appointment of holders of the office and any subsequent independent regulator to the NHS Appointments Commission; he has the power to do so. We have listened carefully to the points that have been made by noble Lords in this debate. Certainly it is well within the bounds of possibility that the concerns that have been expressed will be met.

Baroness Noakes: My Lords, before the noble Lord sits down, would he update the House on the appointment process for the regulator? What stage has it reached and has an appointment yet been made?

Lord Warner: My Lords, the appointment process is ongoing and has not yet been completed. I am not in a position to say any more than that.

On Question, amendment agreed to.

[Amendment No. 92 unallocated.]

[Amendments Nos. 93 to 95 not moved.]

Lord Hunt of Kings Heath moved Amendment No. 96:


    Page 114, line 31, leave out sub-paragraph (2) and insert—


"( ) The document containing the information is to be prepared by the directors.
( ) In preparing the document the directors must have regard to the views of the board of governors."

The noble Lord said: My Lords, I promise that this is my last word on the issue of governance on Report, although no doubt there will be opportunities over the coming two weeks for further discussion if the House of Commons does the right thing by the Bill.

Ideally, I would give the responsibility of approving the forward plan of the trust to the governing body. That would encapsulate a very proactive and proper role for the governing body in which, essentially, it would be asked to agree the strategic plans of the organisation. However, I understand that that is not possible because of the construct of the Bill. The board of directors has to take corporate responsibility for all that is done in the trust. Therefore to have given to the board of governors the absolute right of approval over the forward plan would not be consistent with the corporate responsibility of the board of directors.

What I have sought to convey in my amendment is a form of words which would still leave the final decision with the board of directors, but would also ensure that that board really had to listen and have regard to the views of the board of governors. That goes somewhat further than simply to consult and would give the board of governors a constructive role, while leaving

6 Nov 2003 : Column 978

the actual decision on the forward plan with the board of directors. I hope that that commends itself to the House. I beg to move.


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