Health and Care Bill

Baroness McIntosh of Hudnall Excerpts

Lords Hansard - Part 2 & Report stage
Thursday 3rd March 2022 Lords Chamber

[Lord Lansley (Con)]

My Lords, I will not go on at great length because noble Lords have heard more than sufficient from me today, but this group brings us to what is known in the trade as the provider selection regime: that is, how the NHS goes about the process of commissioning services from a range of providers and the relationship between that and the choice that is available to patients. I am going to refer to my amendments, Amendments 98 and 99, and, without going on about it, I commend Amendment 80 in the name of the noble Lord, Lord Warner. Finding out whether people have actually experienced choice and whether that is helpful to them is a useful thing to do, and I am not sure whether it features in the current electronic referral system. It would be useful to add it in.

The words of Amendment 98 are in fact already in the regulations that the NHS currently lives by because, born of the previous experience when there were discriminatory payment arrangements for private sector providers relative to public sector providers—ie, more advantageous payment arrangements for the private sector than the public sector—in the 2012 legislation we legislated to prevent that happening in the future. The current Bill removes said prohibition on discrimination on the basis of the ownership, public or private ownership, of a provider.

Noble Lords might think, “Ah, this is trying to avoid us discriminating against the private sector.” This was actually included in order to prevent the Government or the NHS discriminating in favour of the private sector. There may be arguments for it in certain circumstances because NHS bodies often have, as it were, fully depreciated assets and to create additional capacity the private sector very often has to invest capital and has to meet the costs of capital as well as the revenue costs of providing services. None the less, we addressed all that and took the view that we did not want any discrimination: we wanted no competition on price, but we wanted competition on quality. That is why, to be perfectly frank, I am testing the Government’s intentions in omitting something that was a central plank of policy for the 2012 legislation.

On Amendment 99, if I recall there is language in the original White Paper from last year, which set the provisions for the Bill, which referred to “any qualified provider” and made it clear that it was the Government’s intention to maintain the existing choice arrangements and access to any qualified provider. Indeed, I think it said that it would “bolster” the system, although I am not sure whether that is happening anywhere. The amendment is really intended to test a particular issue that arose. I am a very sad person, and I was looking at the service conditions for the NHS standard contract; the noble Lord, Lord Stevens of Birmingham, will know them intimately. There is a point at which commissioners who are presented with people who wish to access other providers, who have a contract with another commissioner, are not required to extend that service to them. The way in which it was written in the standard contract was to talk about circumstances where the originating contract does not refer to the address—I think it said the postal address—included in the originating contract. My point to the Government is that this is absurd. There can be geographic limitations, but we should aim not to make them as limiting as the reference to a postal address in the originating contract would have made them.

The wider point is that, if one looks at the new provider selection regime, one sees that there is a process by which commissioners—the decision-making bodies commissioning services—go through a process of saying, “What are the circumstances of commissioning providers?” They ask whether it is circumstance 1, extending the existing arrangement; circumstance 2, going to a different provider; or circumstance 3, going to competition. The language of circumstance 2 is:

“where the decision-making body wants to use a different provider and the decision-making body considers it can identify a suitable provider without running a competitive procurement process”.

This is something that it will be readily able to do in many cases. A commissioner can say, “This is the circumstance. We want to go to a different provider and we know who we want to go to—that’s fine, we’ll give them the contract.”

Circumstance 3 is

“where the decision-making body cannot identify a single provider or group of providers that is most suitable without running a competitive process; or to test the market”.

The body could choose to test the market, but of course more than subtly. Whereas, in the past, the NHS tended to think that it needed to test the market in circumstances in which the legislation did not actually require it to, there is no such thing as compulsory competitive tendering in the 2012 legislation, or the regulations made under it. But now it has shifted completely the other way, and NHS bodies will be able broadly speaking to choose not to use competition at all. The question is whether that will really be sustainable. In the short run, access to the private sector may well be quite widespread, and there may well be a significant element of choice available to patients through the electronic referral service, but that may be closed down in years ahead, if these provisions are implemented in the way in which they are set out.

I issue a further warning to my noble friends. If you are a provider of services to the NHS and you believe that a decision has been made unfairly or inappropriately by the NHS, there is a standstill on the contract, you have 30 days, and you can send in a complaint, in effect, to the decision-making body, which then decides whether it has done the right thing. There is no independent process whatever, so it seems that the chances of providers resorting to law to challenge what they regard as unfair decisions on the part of decision-making bodies in the NHS rise dramatically with the implementation of these processes.

All that said, I hope what I can hear from my noble friends on the Front Bench is that what they said in the White Paper a year ago in February 2021 remains true: that they are going to sustain patient choice, that they will use the resources of NHS providers and beyond to enable us to fulfil our very demanding recovery programme, that they will think hard about whether the precise language in some of the respects that I have outlined is fair to providers, and that commissioners in the NHS will use their procurement capabilities to deliver best value for patients. I beg to move Amendment 98.

[The Deputy Speaker (Baroness McIntosh of Hudnall) (Lab)]

The noble Baroness, Lady Brinton, is contributing remotely.

[Baroness Brinton (LD) [V]]

My Lords, I start by commending Amendment 100 tabled by the noble Lord, Lord Warner, and I look forward to hearing him speak on it. It is an excellent idea to ask people how much choice they have actually had when offered treatment. I also thank the noble Lord, Lord Lansley, for explaining his two amendments, and I would like to say to him that he is not sad for carrying out his role in your Lordships’ House with interest and care. His expertise in matters that may leave others cold should be celebrated. The amendments of the noble Lord, Lord Hendy, ask that trade unions should be part of consultations on private providers, and that seems sensible.

I wish to focus, albeit briefly, on Amendment 106A, which proposes that Clause 70 be left out, and which will be spoken to later by the noble Baroness, Lady Thornton; I apologise to her that under the remote rules I have to speak first. I will confine my remarks to the views of the Delegated Powers and Regulatory Reform Committee’s 15th report, in which paragraphs 17 and 18 make plain its views about these proposed procurement arrangements and regulations. The first point that it notes is that the memorandum, at paragraph 481, says that

“full analysis has not been completed and there has not been time to produce a more developed proposal.”

Why on earth do the Government wish to bring into force legislation that they admit they have not had time to analyse, let alone produce a more developed proposal for? We from our Benches, along with other noble Lords, have repeatedly said that the Cabinet Office procurement Bill is likely to overtake the needs for NHS-specific procurement regulations.

Paragraph 17 of the DPRRC Report gets straight to the heart of the issue and provides a response to the amendments that the noble Lord, Lord Kamall, has tabled, starting with Amendment 101 in this group. It says:

“We do not accept that the inclusion of regulation-making powers should be a cover for inadequately developed policy.”


It is therefore more than a little surprising to see a slew of government amendments on this issue that, in the group under discussion, strengthen the powers under regulation.

Paragraph 18 of the Delegated Powers Committee report states that:

“Ministers would not ordinarily propose clauses in one Bill possibly requiring imminent amendment in a subsequent Bill without expecting to face questions. The House may wish to seek further and better particulars from the Minister concerning the possible effect of any Cabinet Office procurement Bill on the Health and Care Bill, and … to press the Minister on why it was necessary to include provision, based on inadequately developed policy, in the Health and Care Bill when the Government intend to introduce a procurement Bill.”


Not only have we tried this at an earlier stage, but there have been meetings between Committee and Report, and it appears that the Government are determined to press on. I know that the noble Baroness, Lady Thornton, has concerns about the Government’s intentions on the clause and its amendment; if she chooses to call a Division on stand part, we from these Benches will support her.