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Lord Clement-Jones: My Lords, we have had a very interesting few days. I notice that on this occasion the Minister chose to adopt a tone of injured innocence, which many of us found quite diverting. I am not sure that he landed many punches during his speech, but it appears that the Government are now propounding a new constitutional doctrine—that is, providing they have enough Scottish MPs.

Despite a policy not being in their manifesto or in the NHS plan; despite a policy not being contained in a Green Paper or a White Paper; despite a policy not being subject to parliamentary scrutiny or a pilot scheme; and despite no consultations with the professions or NHS staff—and, indeed, despite it being half implemented before any parliamentary approval has been received—the Government are entitled, so the doctrine goes, to railroad their policies through not only this House but also their own English Back-Bench MPs who are opposed to the policy. And, of course, they are entitled to railroad all other interested parties as well. That is taking Parliament and the public for granted on a grand scale.

I have to tell the House that it is with a heavy heart that Members on these Benches will not today press our Amendment No. 161FFF to delete Schedule 1. However, I must say that the tone of the Minister's speech almost made me regret that decision. Some changes have been made to the provisions of Part 1, but we still believe that they fall far short of where they should be. We believe that these proposals are fundamentally flawed in the way I set out in yesterday's debate. Changes, as we know, could have been agreed. Further, even with a review, we now face 18 months of management uncertainty that is of absolutely no benefit to patients or NHS staff.

A point that we have repeated throughout the passage of the Bill is that devolution of power is perfectly feasible under existing powers held by the Secretary of State. The noble Earl, Lord Howe, referred to the very interesting pro forma press release issued—in error, of course—by the department. However, perhaps I may quote a short passage from it. The press release was designed so that trusts could produce their own press releases in the event of a defeat yesterday in the House of Commons:

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    "Press release from [your trust] on the defeat in Parliament of legislation that would have allowed [your trust] to become an NHS foundation trust.


    We are obviously very disappointed by the fact that Parliament"—

let no one say that the Government put words in the mouths of foundation trust applicants—


    "has failed to pass the legislation that would have allowed us to apply for NHS Foundation Trust. We are however heartened by the Secretary of State for Health's Statement to the House of Commons where he pledges himself to continue the process of handing power down to hospitals like us. We understand that, within existing legislation"—

here is the point—


    "there are certain powers that he can give to [your trust] to provide us with greater local control. And we will be attending a meeting with the SoS in London next Tuesday".

It is good to know that there is plenty of advance planning.

In conclusion, I hope that the Government will learn some serious lessons from the events of the past few days. As the Evening Standard commented yesterday,


    "if Dr John Reid and his predecessor Alan Milburn had done a better job of convincing their backbenchers of its merits, the bill could have been passed without bitterness".

I heartily consent to that view. If the Government continue to behave in this fashion, then I have great forebodings about their proposals for the next Session, in particular for higher education tuition funding over which, if anything, there has been less consultation than over foundation trusts.

That is about as gracious a concession speech as I can muster.

Lord Elton: My Lords, can the Minister remind those of us with hazy memories of how many Scottish Members of Parliament there are in his party? How many of them voted for this measure on the second occasion, and where is the seat of the Secretary of State located? That information may enable us to reflect that something seems to have gone wrong with the constitution in the way of devolution.

Lord Warner: My Lords, unlike the noble Lord, all those Scottish Members in the other Chamber are elected. I am sure that, if he takes a few steps along the corridor, he will be able to go to the Library and satisfy his curiosity on many of these issues.

Earl Ferrers: My Lords—

Lord Warner: Perhaps I may finish answering the first question.

Earl Ferrers: My Lords—

Lord Warner: I shall give way to the noble Earl, but I should like to do the service of giving an answer to the noble Lord's questions.

Perhaps I may remind the noble Lord that, if he looks at the Hansard report of the debate held in the Commons during the early hours of today, he will see that, if all the Scottish Members are taken out of play, as if they had not voted, the Government majority

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would have been 10. So the clauses were restored to the Bill and returned to this House by a majority of non-Scottish MPs.

Earl Ferrers: My Lords, I apologise for interrupting the noble Lord and temporarily throwing him off his perch. All I sought to do was to remind him that, when he said that my noble friend Lord Elton was not elected, in fact he is elected. It is the noble Lord opposite who is not elected.

Lord Warner: My Lords, I was so distracted by the noble Earl that I failed to mention the words "elected by the people".

Earl Ferrers: At least we were elected under an Act of Parliament.

Lord Elton: My Lords, can the noble Lord confirm that, had none of those Scottish MPs voted in the first Division, a second Division would not have been called.

On Question, Motion agreed to.

LORDS AMENDMENT

161Schedule 1, Leave out Schedule 1
COMMONS INSISTENCE AND AMENDMENTS

Schedule 1, The Commons insist on their disagreement to Amendment No. 161 but propose the following amendments to the words so restored to the Bill—


161DD Page 108, line 11, leave out from beginning to end of line 8 on page 109 and insert—

"Eligibility for membership

3 (1) The persons who may become or continue as members of a public benefit corporation are—
(a) individuals who live in any area specified in the constitution as the area for a public constituency,
(b) individuals employed by the corporation under a contract of employment and, if the constitution so provides, individuals who exercise functions for the purposes of the corporation otherwise than under a contract of employment with the corporation,
(c) if the constitution so provides, individuals who have attended any of the corporation's hospitals as either a patient or the carer of a patient within a period specified in the constitution.
(2) The constitution may specify one or more areas as areas for public constituencies, each of which must be an electoral area for the purposes of local government elections in England and Wales or an area consisting of two or more such electoral areas.
(3) A person may become or continue as a member of the corporation by virtue of sub-paragraph (1)(b) 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 months or, where he exercises functions for the purposes of the corporation as mentioned in that sub-paragraph, he has done so continuously for such a period.
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 employed by the corporation, or has continuously exercised functions for the purposes of the corporation, as it applies for the purposes of that Act.

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(4) The constitution may divide those who come within sub-paragraph (1)(b) into two or more descriptions of individuals.
(5) An individual providing care in pursuance of a contract (including a contract of employment), or as a volunteer for a voluntary organisation, does not come within sub-paragraph (1)(c).
A voluntary organisation is a body, other than a public or local authority, the activities of which are not carried on for profit.
(6) The constitution may divide those who come within sub-paragraph (1)(c) into three or more descriptions of individuals, one of which is to comprise the carers of patients.
(7) The constitution may make further provision as to the circumstances in which a person may not become or continue as a member.
Constituencies

4 (1) Members of a public benefit corporation are referred to as follows.
(2) Those who live in an area specified in the constitution as an area for any public constituency are referred to collectively as a public constituency.
(3) Those who come within paragraph 3(1)(b) are referred to collectively as the staff constituency and, if the power in paragraph 3(4) is exercised, each description of members is referred to as a class within that constituency.
(4) Those who come, within paragraph 3(1)(c) are referred to collectively as the patients' constituency and, if the power in paragraph 3(6) is exercised, each description of members is referred to as a class within that constituency.
(5) A person who is a member of a constituency, or of a class within a constituency, may not while that membership continues be a member of any other constituency or class.
(6) A person who comes within paragraph 3(1)(b) may not become or continue as a member of any constituency other than the staff constituency.
5 The constitution is to require a minimum number of members of each constituency or, where there are classes within the constituency, of each class.
Becoming a member

5A (1) An individual who is eligible to become a member of a public benefit corporation may do so on an application made to the corporation.
(2) The constitution may provide for any individual who is—
(a) eligible to become a member of the staff constituency, and
(b) invited by the corporation to become a member of that constituency (and, where there are classes within the constituency, as a member of the appropriate class), to become a member of the corporation as a member of that constituency (and class) without an application being made, unless he informs the corporation that he does not wish to do so.
(3) The constitution may provide for any individual who is—
(a) eligible to become a member of the patients' constituency (otherwise than as the carer of a patient), and
(b) invited by the corporation to become a member of a specified constituency (and where there are classes within the constituency, a member of the specified class), to become a member of the corporation as a member of that constituency (and class) without an application being made, unless he informs the corporation that he does not wish to do so.
(4) The constituency and, where applicable, class to be specified—
(a) if he is eligible to be a member of any public constituency, is that constituency,
(b) otherwise, is the patients' constituency and, where applicable, the class of which he is eligible to become a member"

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161EE Page 109, leave out lines 15 to 17 and insert—
"(4) Members of a constituency or, where there are classes within it, members of each class may elect any of their number to be a member of the board"
161FF Page 109, leave out line 32 and insert "members of the corporation other than those who come within paragraph 3(1)(b)"
161GG Page 109, line 33, leave out from "least" to end of line and insert "three members of the board are to be elected by the staff constituency or, where there are classes within it, at least one member of the board is to be elected by each class and at least three members are to be elected altogether"
161HH Page 109, line 39, leave out "the area specified under paragraph 3(1)(a)" and insert "an area specified in the constitution as the area for a public constituency"
161JJ Page 110, leave out lines 4 and 5 and insert—
"( ) But such a member ceases to hold office if he ceases to be a member of the corporation"
161KK Page 110, line 27, after second "executive", insert "(and accounting officer)"
161LL Page 110, line 29, at end insert—
"( ) One of the executive directors is to be a registered medical practitioner or a registered dentist (within the meaning of the Dentists Act 1984 (c. 24)); and another is to be a registered nurse or a registered midwife"
161MM Page 110, line 33, leave out "the public constituency" and insert "a public constituency or the patients' constituency"
161NN Page 110, line 43, leave out "the chief executive" and insert "a committee consisting of the chairman, the chief executive and the other non-executive directors"
161OO Page 111, leave out lines 1 and 2 and insert—
"( ) The appointment of a chief executive requires the approval of the board of governors"
161PP Schedule 1, page 111, line 8, at end insert "but the constitution may make provision for those matters to be decided pending the establishment of such a committee.
Initial directors of former NHS trusts

17A (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 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 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 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 appointed.
(6) Sub-paragraphs (a) and (b) of paragraph 15(3) do not apply to the appointment of any initial non-executive director in pursuance of this paragraph; and paragraph 16(4) does not apply to the appointment of the initial chief executive of the corporation in pursuance of sub-paragraph (5)"
161QQ Page 111, line 12, at end insert "and, where there are classes within it, the class to which he belongs"
161RR Page 111, line 13, at end insert—

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"( ) a register of interests of the members of the board of governors"
161SS Page 111, line 18, at end insert "members of the board of governors and of"
161TT Page 111, line 20, leave out from beginning to "available" and insert "A public benefit corporation is to make the following documents"
161UU Page 111, leave out line 25
161VV Page 111, line 32, at end insert—
"( ) The corporation is also to make the registers mentioned in paragraph 18 available for inspection by members of the public, except in circumstances prescribed by regulations; and, so far as the registers are required to be available—
(a) they are to be available free of charge at all reasonable times,
(b) a person who requests it is to be provided with a copy of or extract from them"
161WW Page 111, line 33, leave out "the copy or extract" and insert "a copy or extract under this paragraph"
161XX Page 111, line 38, 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"
161YY Page 112, leave out lines 4 and 5 and 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.
( ) The corporation is to establish a committee of non-executive directors as an audit committee to perform such monitoring, reviewing and other functions as are appropriate.
( ) In this paragraph "the Audit Commission" means the Audit Commission for Local Authorities and the National Health Service in England and Wales"
161ZZ Page 112, line 13, at end insert—
"( ) If trustees are appointed under section 22, the Comptroller and Auditor General may also examine—
(a) the accounts kept by the trustees,
(b) any records relating to them, and
(c) any report of an auditor on them"
161AAA Page 112, leave out line 31 and insert—
"( ) The constitution is to provide for the functions of the corporation under this paragraph to be delegated to the accounting officer"
161BBB Page 112, line 38, leave out "and the registrar of companies"
161CCC Page 112, line 41, leave out "its public constituency" and insert "any public constituency and (if there is one) of the patients' constituency"
161DDD Page 113, line 2, leave out "him" and insert "it"
161EEE Page 113, leave out lines 6 and 7 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"

Lord Warner: My Lords, I beg to move that the House do not insist on its Amendment No. 161, to which the Commons have disagreed, and do agree with the Commons in their Amendments Nos. 161DD to 161EEE.

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Moved, That the House do not insist on its Amendment No. 161, to which the Commons have disagreed, and do agree with the Commons in their Amendments Nos. 161DD to 161EEE.—(Lord Warner.)

On Question, Motion agreed to.

[Amendment No. 161FFF not moved.]


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