National Health Service Trust Development Authority (Directions and Miscellaneous Amendments etc.) Regulations 2016.

(Limited Text - Ministerial Extracts only)

Tuesday 10th May 2016 Grand Committee

[Baroness Walmsley (LD)]

My Lords, I have no intention of detaining the Committee, as I agree with everything that the noble Lord, Lord Hunt, has said. I look forward to hearing the Minister’s reply. I am particularly concerned that a very complex system of governance will not produce transparency and accountability, and I look forward to reassurance on that score.

[The Parliamentary Under-Secretary of State, Department of Health (Lord Prior of Brampton) (Con)]

My Lords, that was a short intervention from the noble Baroness. I was very struck by the noble Lord, Lord Hunt, saying that, when the 2012 legislation went through Parliament, it took 85 days and 85 of the Bill’s clauses dealt with Monitor alone. I am afraid that that is part of the response that I shall give him today. We did not have 85 days—or maybe 165 days, if we take into account the TDA and the restructuring—because matters are too urgent. However, the noble Lord is right to bring this issue up today, because I do not think that there has been enough scrutiny around Monitor, the TDA and NHS Improvement.

Responding to the points that he raised about foundation trusts will perhaps in part answer both questions. The distinction between foundation trusts and trusts has been eroding over time—there is no question about that. The roles of Monitor and the TDA were becoming more duplicated over time. It is interesting that, when David Bennett was at Monitor, he saw the need to develop an improvement agency within Monitor, almost mirroring the TDA. Simply being a financial and economic regulator was clearly not enough at a time of such huge stress and pressures within the system.

However, there are two other important factors that I should mention. At the time, I agreed that the principle of foundation trusts—I think it was called “earned autonomy”—was absolutely right, as was the governance structure, with clear accountability through locally elected and appointed governors to the local population. But when the King’s Fund says that what we now have is the end of competition and autonomy, it is partly right. Using competition as a means of driving improvement through the NHS has been tested almost to destruction. It started back in 2005-06, with the new Labour Government and ISTCs, foundation trusts and the like. Increasingly, we are of the view that competition has a role to play but a pretty limited one, and we cannot rely upon competition—or the market, if you like—to drive the kinds of improvements and change that are needed within the system.

--- Later in debate ---

[Lord Hunt of Kings Heath]

I thank the noble Lord, Lord Prior, for his response. I certainly understand the need for speed and the erosion over time of the distinction between foundation trusts and non-foundation trusts. I also agree with the Minister on the issue of competition. The past years have shown that while it can play a role, that role should be limited, and I have no objection to that, nor, indeed, to the extended remit of improvement. That is something which has been missing from the regulatory apparatus and it is to be welcomed.

I would like to make a couple of points. First, the Minister said that we are moving locally to system-level leadership and development. I am sure that that is right, but I hope that local accountability will be borne in mind. I have just had responses to a number of Questions for Written Answer that I tabled about accountability in the sustainability and transformation plans. As the Minister knows, they have to be in by 30 June. We know that they will all say that the acute care footprint will be reduced by so many hundreds of beds—to be honest, this has all been done before—and they will then say that there is going to be heroic demand management and, somehow or other, there will be miraculous developments in the community. But they will not have ownership locally because, essentially, they are being top-down led. At some point, they will have to go through formal consultation procedures and I believe that, unless there are some powerful forms of local accountability, they will run into trouble.

[Lord Prior of Brampton]

I think that the noble Lord has put his finger on it. If the STP process is just another top-down-led system redesign, it will not have any teeth to it. But what has happened in Manchester, for example, is that there is clear local leadership and accountability, which mean that some of the really difficult decisions that have not been taken for generations are now being addressed. There must be effective local accountability and governance around the STPs.

[Lord Hunt of Kings Heath]

The other area, which I have raised with the Minister before, is in relation to clinical commissioning groups. First, the creation of federations of GPs makes the model unsustainable in the long term, because in some parts of the country the electoral body for the GP members of CCGs will be almost coterminous with the federations. Clearly, there is a conflict of interest in that. Secondly, there is still an issue about the accountability of CCGs. If ever one needed a governance structure that made them somehow locally accountable, the foundation trust model would provide some answers which I hope that the Government will look at.

My final point is on what legislation will be in the Queen’s Speech. Clearly, from all that the Minister has said, much of the 2012 Act is defunct in practice. We are moving to a planning model, and the Act is very different from that. The longer that this goes on, the more need there will be at some point for some legislative change, because at the moment people in the health service are at risk. They are essentially being asked to develop a system-led planning model, but that is challengeable because the Act is very different from that. I believe that at some point it will be challenged. The Government may not want to have core health legislation debated, but at some point that will have to be done. I also remind him that we still have a draft Law Commission Bill and I am hoping that, at the very least, we will see a short form of that announced in the Queen’s Speech.

This has been an excellent debate and I am very grateful to the noble Baroness, Lady Walmsley, and the noble Lord, Lord Prior.