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Health and Social Care (Community Health and Standards) Bill

6.47 p.m.

A message was brought from the Commons, That they agree to certain amendments made by your Lordships without amendment; they agree to certain other amendments with amendments to which they desire the agreement of your Lordships; they disagree to certain other amendments but have made amendments to the words so restored to the Bill to which they desire the agreement of your Lordships; and they disagree to the remaining amendments for which they assign reasons.

Lord Davies of Oldham: My Lords, consideration of the Commons message will be taken as agreed at 9.45 p.m. Therefore, I beg to move that the House be adjourned during pleasure until 9.45 p.m.

Moved accordingly, and, on Question, Motion agreed to.

[The Sitting was suspended from 6.48 until 9.45 p.m.]

The Parliamentary Under-Secretary of State, Department of Health (Lord Warner): My Lords, I beg to move that the Commons amendments and reasons be now considered.

Moved, that the Commons amendments and reasons be now considered.—(Lord Warner.)

On Question, Motion agreed to.


[The page and line references are to HL Bill 94 as first printed for the Lords.]


1Clause 1, Leave out Clause 1 The Commons disagree to this Amendment for the following reason—

1ABecause it is necessary to provide for the constitution of NHS foundation trusts.

Lord Warner: My Lords, I beg to move that the House do not insist on its Amendment No. 1 to which the Commons have disagreed for their reason numbered 1A.

I do not intend to go over the whole case for NHS foundation trusts, other than to reiterate two key points. First, foundation trusts are totally consistent with the founding values of the NHS. They are an integral part of it, and there is absolutely no evidence that they will damage local health economies. Secondly, the governance arrangements involve patients, the public and staff in their local hospitals in a way that has never been achieved before. The

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argument that nobody supports foundation trusts does not stand up. When people know the advantages, they come forward and want foundation trust status.

As I said in Committee, 25 NHS trusts are consulting on proposals to apply for NHS foundation trust status from next April and a further 30 or so have applied to be considered for coming on-stream in autumn 2004. If all those applications were successful, some 25 per cent of the population in England would have access to NHS foundation trusts by the end of 2004. By their irresponsible actions, the two Opposition Benches have sought to wreck the Bill and thwart those local people from securing the local freedoms that they want.

Noble Lords: Oh!

Lord Warner: Noble Lords should hear the rest of it. I acknowledge that there was scope for improving the original Bill. That is why the Government have proposed or accepted more than 200 amendments, 90 of them relating to NHS foundation trusts. That is clear evidence that we have listened and responded to concerns.

This House has discharged its scrutiny and review functions. It has asked the other place to think again, and it has done so. It has rejected clearly this House's removal of Clause 1 and Schedule 1, by 303 votes to 286. In that vote, 80 per cent of Labour MPs voted in favour of foundation trusts—with 19 extra converts since the previous vote on the issue. With two votes, at least, by the Commons on the issue, it is the clear will of the Commons, the elected House, to have Clause 1 and Schedule 1 as amended restored to the Bill. I do not think that it is for this House to resist restoration.

Even at this late stage of the proceedings, my right honourable friend the Secretary of State has shown how much he has listened to the concerns expressed that we need to be in a position to learn from the experience of the first NHS foundation trusts before the rest of the NHS applies for that status. That is why he made it clear earlier in the other place that he was prepared to review how we proceed in the light of our experience and to learn the lessons from the early NHS foundation trusts that start up in 2004.

As he said then, there will be an opportunity to do that in the 12-month period before the end of the first wave of foundation trusts in autumn 2004 and autumn 2005. That is why my right honourable friend told the other place that he would ask the Commission for Healthcare Audit and Inspection—which will, of course, be accountable to Parliament, not him, under the Bill—to insist on that review. During the period of that review, the Secretary of State would not pass any new applications for a new NHS foundation trust to the independent regulator.

The Benches opposite have been calling for an independent review; and here is my right honourable friend offering it—an independent review at that. It will be able to consider the governance issues by which they are still troubled; it will be able to consider the

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relationship between NHS foundation trusts and others in the local health economy. It will be in the hands of CHAI. The report goes to Parliament, which will of course be able to debate it. What more do noble Lords have to quibble over? I urge the House to agree with the Commons reinstatement of Clause 1 and Schedule 1 as amended.

Before I finish, I should make absolutely clear that no matter how how many times this Bill goes back to the Commons, it will come back with Clause 1 and Schedule 1 reinstated. If that means that this House's action means that the Bill is lost, that will be a consequence of this particular House's action. I want to make absolutely clear that that is the Government's position; it will be in the public arena shortly. I beg to move.

Moved, That the House do not insist on its Amendment No. 1 to which the Commons have disagreed for their reason numbered 1A.—(Lord Warner.)

1BEarl Howe rose to move, as an amendment to the Motion that the House do not insist on its Amendment No. 1 to which the Commons have disagreed for their reason numbered Amendment 1A, leave out "not".

The noble Earl said: My Lords, today's vote in the House of Commons means that this House must once again make a decision about Part 1. It is an important decision for the health service as a whole and for its patients, and I have thought hard about what it is best for us to do. First, we must recognise that, having been asked by your Lordships to think again on foundation trusts, the elected House has reached a decision and has approved the Government's policy for a second time.

However slim the Government's majority in the other place—it was extremely slim—we should not lightly dismiss that result. Our second task is to consider the issue. Nothing has changed since the House debated it on Report the week before last. The Government have made no substantive concessions to address the two main concerns voiced by noble Lords about foundation trusts—the dangers posed for the wider NHS by the creation of an elite tier of hospitals and the threat to effective and good governance of foundation trusts stemming from the Bill's confused and cumbersome governance provisions.

Nothing has changed on those two fronts—and my mind has certainly not changed. What has changed is the majority in the other place. I do not see how this House can fail to give weight to the fact that a Government with an overall majority of 164 was reduced to a majority of a mere 17 in the vote earlier this evening. That was not simply a majority of only 17; that was a majority achieved only by virtue of the votes of 44 Scottish Labour Members whose constituents have no direct interest in the matter at issue, and whose own health service, being devolved, is one over which the Westminster Parliament has no say.

Those Members of course have a perfect legal right to troop through the Lobby in support of the Government, but the outcome of the vote and its significance for this House is, I suggest, devalued

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because of the part that they played in it. There is a real sense in which we can say that the House of Commons has not spoken on behalf of the man and woman in the street. I do not know how many noble Lords heard the comments of Mr Frank Field, who said that if the House of Commons had been given a free vote this afternoon, the Government would have lost by at least 50.

Whether we agree with that precise number or not is irrelevant. The point is that the Government did not succeed in winning today's vote by persuasion or on the strength of the argument. They won it by twisting the arms of their own supporters and flying a Minister back from Australia. In contrast, it is sometimes said that this House—the unelected House—is better able to reflect the public mind than the other place. I happen to think that we can say that with confidence on the issue of foundation trusts. It is not only Members of the House of Lords who are opposed to the Government, but the BMA, the unions and, indeed, the vast bulk of the general public.

Yesterday, NOP published a poll in which only 4 per cent of respondents said that their top priority was to have their local hospital run by a foundation trust. In contrast, 83 per cent favoured a well run local hospital with shorter waiting times and 84 per cent of people wanted public money aimed at improving all NHS hospitals. Only 7 per cent believed that more money should be given to the hospitals that are currently doing well.

The Government will no doubt wave those results away, but they reflect the anxieties and opinions of real people. That public feeling and the views of those working in the health service were very powerful reasons why this House was justified in returning Clause 1 and Schedule 1 to the Commons two weeks ago. The provisions in the Bill on public consultation have been strengthened, I am glad to say. However, it is a matter of great concern that those patients and members of the public who are served by the first wave of applicant trusts will have been given no say whatever in the decision to apply for foundation status. If we had wanted proof of the Government's stated desire to involve local people in decision making on health, it would have been found in a genuine consultation exercise on the question, "Foundation status—yes or no?" That was one question that was never asked.

On an earlier occasion, I said that I was genuinely sorry to find myself opposing devolution in the NHS, and I am. However, when the detail of that devolution policy poses such dangers for the health service, I am in no doubt that opposition is necessary. I do not ask the Government to take the proposals away and never bring them back. I ask only that they take them away, refashion them in a manner that addresses the genuine concerns expressed in this House by noble Lords and by Members of another place and bring back their revised ideas in the next Session of Parliament.

To noble Lords who asked why we should resist these proposals the second time, I say this: I do not want to find that, in two or three years' time, the

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people in my village who are sent for treatment at a local hospital discover that that hospital is less well equipped than the foundation hospital 40 miles away, because it has been unable to invest on the scale that it needs to do because the foundation trust enjoyed easier, privileged access to capital funding. Nor do I wish to find that the foundation hospital serving my 82 year-old father-in-law has decided to skew resources away from services for the elderly, from dedicated stroke units and chronic pain management because its board of governors is working to an agenda dictated by a local and vocal minority of members.

By definition, it is the dispossessed and socially excluded who will lose out in that model of governance. I want no part of such an ill thought out system. This House is well within its rights to reject Clause 1 for a second time. I believe that it has a duty to do so for the sake of the NHS and all those who use it. I therefore beg to move.

Moved, as an amendment to the Motion that the House do not insist on its Amendment No. 1 to which the Commons have disagreed for their Reason 1A, leave out "not".—(Earl Howe.)

10 p.m.

Lord Clement-Jones: My Lords, I support Amendment No. 1B, and I shall speak to Amendment No. 161CC.

Many of us heard a powerful debate in the other place, whether we were present in the Gallery or saw it on television. It was impressive to see many Labour MPs take a principled stand on the issue. The fact that, despite the concessions, the Government achieved half the majority that they had on an earlier occasion demonstrated that the Government's arguments are becoming thinner by the hour. The speech made by the noble Lord, Lord Warner, today was characteristic of that: it was short, to the point and entirely devoid of reasoned argument.

I heard the Secretary of State on the radio this morning and also in the House. His understanding of history seemed to be completely flawed, and I felt like sending him a reading list. He should brush up on the history of the NHS: William Beveridge was a Liberal and one of the architects of the NHS. Instead of that, we heard that we were tearing down the NHS and that those of us on these Benches were partly responsible, along with all sorts of other villains and miscreants. That is a very partial view of history.

My honourable friend Paul Burstow made it clear during the debate today that Liberal Democrats had no argument with devolution in the NHS. We too wish to see NHS hospitals freed from micro-management and inappropriate targets. However, foundation trusts, in their present form, are not the instrument for that. They were not in the Government's manifesto at the previous election, and they were not in the NHS Plan. There was no consultation on the new system, yet Ministers have been cooking up the proposals and inviting applications since the beginning of last year.

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The method of selection, via the star rating system, is arbitrary, with the Secretary of State making the final decision.

Local consultation has also been flawed. Whole London boroughs have been excluded from consultation and from the governance arrangements proposed for applicant foundation hospitals. Much of the consultation has assumed the form of a fait accompli. The coverage of foundation trusts will be partial and potentially competitive, yet foundation trusts can and may have a profound effect on the balance of the local health economy and the services that local people need. It is hardly surprising that cancer networks, for example, are fearful of the future. The powers of the regulator are not spelt out and take insufficient heed of that fact.

As I said on Report, the key issue, ultimately, is whether there will be any resulting benefit for patients. The well respected Health Select Committee rightly asked whether such competition between hospitals would benefit patients. The poll referred to by the noble Earl, Lord Howe, demonstrated the ignorance of the public about foundation trusts. Those who know what foundation trusts mean are against them. The doctors, nurses and other staff in the NHS are deeply sceptical about the proposals.

As my honourable friend said, in so far as foundation trusts secure freedom to act, it is hard to see how that freedom will not disadvantage the hospitals that are left behind. The rules for borrowing are a key example. Foundation trusts will have an advantage over other NHS trusts; they will have easier access to capital. The Treasury has ensured that there will be a zero-sum game, as we have pointed out relentlessly through the passage of the Bill. The NHS capital pot is fixed in size. If foundation trusts can dip into that pot more easily, it will be at the expense of the rest of the NHS.

My honourable friend also pointed out the short-term nature of the requirement for foundation trusts to adhere to Agenda for Change. There is nothing in the Bill to prevent foundation trusts, over time, varying their pay and conditions, in order to be better placed to expand. Foundation trusts will soon be able to compete on pay and conditions, at the expense of patients treated anywhere else in the NHS. So much for the assurances that the Minister gave about the duty of co-operation with other parts of the NHS that foundation trusts will have.

Our amendment deals, in particular, with the governance arrangements set out in Schedule 1. Schedule 1 amounts to the ramshackle and expensive construction of sham democracy, with self-selected members, powerless governing bodies and massively expensive servicing requirements. My honourable friend who, most unusually, reads Hansard for this House, noted that the most powerful speeches in regard to foundation hospitals and governance were those of the noble Lords, Lord Lipsey and Lord Harris.

Finally, as Members on these Benches pointed out on Report, foundation trusts start at the wrong point. It is in commissioning where we need to give local

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control: to those who commission healthcare and who need to be responsive to local needs. The commissioners—the primary care trusts—should be democratically accountable. That is what Members on these Benches in both Houses have argued for. It remains a mystery why the Government did not accept that from the outset. Instead, new governance arrangements simply re-emphasise the dominance of acute hospitals at the expense of primary care, preventive health strategies designed to improve public health and reduce health inequalities, along with the integration of health and social care.

The Government have retreated to a great extent on this Bill. Now we have last-minute concessions that amend the Bill so that it will affect a shrinking number of applicants, now down to some 50 or so. The Government should make this retreat complete and drop Part 1. If the Bill as a whole is lost, then let us be quite clear: this has been an accident waiting to happen right from the outset—as a result of the Government's own actions, which are entirely self-inflicted. The Government should accept the verdict of this House and of NHS staff.

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