Health and Care Bill

Baroness Thornton Excerpts

Lords Hansard - Part 1 & Committee stage
Monday 31st January 2022 Lords Chamber

Moved by

[Baroness Thornton]

222: After Clause 80, insert the following new Clause—
“Cap on private charges
(1) Section 43 of the National Health Service Act 2006 is amended as follows.(2) After subsection (2A) insert—“(2B) An NHS foundation trust does not fulfil its principal purpose if in any financial year the proportion of the total income of the trust derived from private charges is greater than in the previous financial year unless—(a) the appropriate integrated care boards and integrated care partnerships have been notified of the intention that this increase will occur;(b) that intention has been published with a statement of the reasons why it is considered to benefit the NHS;(c) the appropriate integrated care boards and integrated care partnerships have used reasonable endeavours to consider any responses to the publication mentioned in paragraph (b); and(d) any integrated care board which has commissioned services from the trust, and the integrated care partnership for the board, have informed the NHS foundation trust that the proposed increase is justified.(2C) For the purposes of subsection (2B) “private charges” means charges imposed in respect of goods and services provided to patients other than patients being provided with goods and services for the purposes of the health service.””Member’s explanatory statement
The amendment prevents any Foundation Trust from increasing its income from private patients unless this is agreed by the relevant commissioning bodies and the appropriate integrated care partnerships.

[Baroness Thornton (Lab)]

My Lords, Amendments 222 and 223, in my name, seek clarification about the private charges cap. Amendment 222 would prevent any foundation trust increasing its income from private patients unless this was agreed with the relevant commissioning bodies and the appropriate ICB. Amendment 223 would remove the power for NHS trusts and foundations to form subsidiary companies.

When foundation trusts were introduced in 2003, they were restricted in the amount of private patient work they could carry out. That was, in part, to alleviate concerns that they might unduly focus on generating income from private patients rather than tackling the then considerable waiting lists. The compromise stood for many years and proved to be little hindrance, although there is one trust on record that declined to move to foundation trust status because it did have a large private patient income—I will leave it to the Minister to work out which one it was. Overall, the regulations have been sufficient to ensure that such activity did not grow and waiting lists came down. The restriction only ever applied to foundation trusts—not to plain old NHS trusts, although we all know that they are, of course, subject to the will of the Secretary of State in all things anyway.

The notion of independence was reinforced under the new settlement of the 2012 Act. That removed the restrictions and allowed, at least notionally, for a foundation trust to move to have up to 50% of its income from private patients. Although there were some claims that this would lead to a huge acceleration of private patient work, once again that did not prove to be the case.

Now we arrive at today. The new Bill is based on the assumption that the logic of competition between acute trusts is indeed minimised and that they should be more focused on general good, and less on autonomy and their own bottom line than on co-operation between different parts of the NHS in their locality. Logic suggests that in this new world we should once again look at ensuring that private patient work has no adverse impact on the core work of the NHS. These amendments are similar to those that were used to ensure that private interests cannot be allowed to influence the work of ICBs, and that that should be recognised in the Bill.

I have another three, very detailed pages, but I will spare the Committee those. I beg to move.

[The Principal Deputy Chairman of Committees (The Earl of Kinnoull) (CB)]

I thank the noble Baroness very much indeed. That makes it 15 all, I think.

The noble Baroness, Lady Brinton, is participating remotely, and I invite her to speak now.

--- Later in debate ---

[Baroness Chisholm of Owlpen (Con)]

Well done. You need Baronesses to do this: they get to the point and get it done.

I thank noble Lords for explaining these amendments. As they may recall, in 2012 we abolished the private patient cap while clarifying that the foundation trusts’ principal purpose is

“the provision of goods and services for the purposes of the health service in England”.

This means that foundation trusts must make the majority of their income from NHS activity and must always have as their primary purpose the delivery of NHS services. We also retained the requirement that additional income should be used to benefit NHS patient care, and it has been used across the system to offset such things as maintenance costs, to finance alternative transport such as park and-ride and to fund patient care.

This amendment would introduce a new cap by requiring foundation trusts to agree with their ICB and ICP their income from non-NHS sources. However, this would be a significant bureaucratic burden on foundation trusts and would require them to forgo raising additional income or seek agreement via a multi-stage process before doing so. It would also mark a significant new restriction on foundation trusts’ freedoms and autonomy.

Similarly, Amendment 233 would restrict the freedom of NHS organisations to decide locally the most appropriate structures they need to support their operations. There are multiple reasons for trusts setting up subsidiary companies, including providing services for other trusts and being able to attract staff from the local employment market. Creating a subsidiary can also be an alternative to outsourcing services to the private sector, thereby maintaining its staff within the NHS family. Importantly, in November 2018 NHS Improvement issued guidance to trusts about forming or changing a subsidiary. Under that guidance, all subsidiary proposals must be referred to NHS Improvement for review. NHS England and NHS Improvement paused their update of the guidance to trusts on subsidiary companies to allow the sector to focus on supporting the response to Covid-19 and the recovery of services. However, we remain committed to the review and the publication of this updated guidance is now set for early summer 2022.

I hope I have given the noble Baroness sufficient reassurance for her to withdraw the amendment.

[Baroness Thornton (Lab)]

I thank the Minister and am very pleased indeed to hear about the review. However, we on this side of the House believe that the NHS should be the default provider of clinical services and, if it is not the only provider, it should be the predominant one in geographical and service terms. That means that there must be investment in the NHS, not in the private sector. It is that balance, which we must ensure is in this Bill, that has protected NHS clinical services in the past.

I will read what the noble Baroness has said very carefully, and I might need further reassurance in due course. I beg leave to withdraw the amendment.

Amendment 222 withdrawn.