Health Bill

Earl Howe Excerpts

Committee stage
Wednesday 28th October 2026 Lords Chamber

[Baroness Pidgeon (LD)]

My Lords, we welcome these Government amendments, which ensure that the devolved Administrations’ boundaries are protected and that there is proper consultation and agreement. But devolution must be integral to any legislation from the start, rather than an afterthought. Granted, there has been consultation with the devolved Governments, but these amendments were tabled very late and this is a worrying sign. It is an indication that aspects of the reorganisation and its governance implications had not been properly thought through at the start—through the lens of the devolved Administrations, rather than simply through that of Whitehall and civil servants centrally. The Minister’s words have provided some assurance, and I look forward to the devolved Administrations being at the start and the heart of legislation such as this in the future, rather than an add-on at a late stage.

[Earl Howe (Con)]

My Lords, it is a pleasure to begin our Committee consideration of the Health Bill, and I look forward to the discussions over the coming days. I am grateful to the Minister and to the Government for bringing forward these amendments, which we understand to be principally technical in nature, although there are questions we shall want to ask in later groups about cross-border patient referrals and related issues. We welcome the clarification these amendments provide regarding the consent of the devolved Administrations and the exercise of powers by devolved health bodies, and we are content to support them.

I hope the Committee will allow me to take this opportunity to acknowledge the letter sent by the Minister this morning concerning Healthwatch. Noble Lords across the House will welcome the Government’s decision not to proceed with its abolition, and I am grateful to the Minister for listening to the concerns raised in this House and elsewhere. This is a very positive example of the Government engaging constructively with the scrutiny of this Bill and showing a willingness to reconsider their proposals where legitimate concerns have been raised. That is precisely the spirit in which I hope we can continue our consideration of this legislation, and I welcome the approach the Government have taken on this occasion. I look forward to the Minister’s response.

[Baroness Merron (Lab)]

My Lords, I am grateful for this brief but important debate, and in particular for the support for these amendments. As the noble Earl, Lord Howe, says, they are technical amendments. I say to the noble Baroness, Lady Pidgeon, that this is absolutely nothing to be worried about: we work closely with the devolved Governments, and this is an extra layer of reassurance to them that we felt was helpful, because it is what they sought. These technical amendments are brought forward not as an afterthought but because that is what conversations have led us to think is the right thing to do. I know they very much welcome this, and I am grateful for their assistance.

I hear what the noble Earl, Lord Howe, said about the letter I sent out and the announcement in respect of Healthwatch. I am most grateful to noble Lords for their engagement as we have approached this point in the Bill. As the noble Earl acknowledged, we are always keen to listen. We cannot always do exactly what every noble Lord would want, but I am glad that the noble Earl welcomes the way in which the Secretary of State and the Prime Minister have approached this.

On the point raised by the noble Baroness, Lady Finlay —who also gave her support—about particular programmes, I am very happy to look into that. However, as I have set out, we intend for the programmes to which we are committed to be transferred to the department. What happens in the longer term on the prevention agenda is another consideration. We work very closely with the devolved Administrations on prevention, but, ultimately, healthcare is a devolved matter. I commend the amendment to the Committee.

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Moved by

[Earl Howe]

4: After Clause 3, insert the following new Clause—
“Abolition of NHS England: transition plan(1) The Secretary of State must prepare and publish a transition plan in relation to the abolition of NHS England.(2) The transition plan must set out—(a) the objectives which the abolition of NHS England is intended to achieve;(b) the arrangements and timetable for transferring the functions, property, rights and liabilities of NHS England;(c) the bodies to which those functions, property, rights and liabilities are expected to be transferred;(d) the estimated gross costs associated with the abolition of NHS England and the implementation of the arrangements mentioned in paragraph (b); (e) the estimated costs of redundancies, voluntary exits, pension liabilities and other staff-related payments arising from—(i) the abolition of NHS England,(ii) the restructuring of the Department of Health and Social Care,(iii) changes affecting integrated care boards, and(iv) changes affecting commissioning support units;(f) the estimated costs associated with—(i) the transfer, retention or disposal of property,(ii) the transfer, variation or termination of contracts,(iii) the transfer of information technology, data, records and other systems,(iv) the establishment or modification of governance and accountability arrangements,(v) the recruitment and training of staff,(vi) the retention or replacement of specialist staff and expertise,(vii) consultancy and other external professional services, and(viii) any other activity required to implement the abolition;(g) the estimated recurring annual savings expected to arise from the abolition of NHS England; (h) the extent to which the savings mentioned in paragraph (g) are expected to constitute cash-releasing savings;(i) the methodology, assumptions and baseline against which the costs and savings mentioned in this subsection are to be calculated;(j) the financial year in which the total cumulative savings arising from the abolition of NHS England are expected to exceed the total cumulative costs of implementing that abolition;(k) the existing departmental, health service or other budgets from which transition costs are to be met;(l) the effect which meeting transition costs from the budgets identified under paragraph (k) is expected to have on—(i) the provision of health services,(ii) planned capital and technology expenditure,(iii) integrated care boards,(iv) workforce budgets, and(v) other departmental programmes;(m) the amount of any savings expected to be made available for the provision of front-line health services and the arrangements by which those savings are to be identified, transferred and monitored;(n) the principal clinical, financial and operational risks associated with the transition;(o) the measures to be taken to secure the continuity of services during the transition;(p) the measures to be taken to identify, retain and transfer staff with specialist knowledge or expertise;(q) the arrangements for the transfer and continued operation of nationally significant services, contracts, information systems and corporate holdings;(r) the measures by which the Secretary of State will assess whether the objectives mentioned in paragraph (a) have been achieved.(3) The estimates contained in the transition plan must distinguish between—(a) one-off transition costs,(b) recurring expenditure,(c) gross savings,(d) net savings, (e) cash-releasing savings, and(f) non-cashable efficiencies or avoided future costs.(4) The Secretary of State must arrange for the transition plan, including its financial estimates, methodology and assumptions, to be reviewed by an independent person with experience of public-sector finance, organisational restructuring or health service administration.(5) A person carrying out a review under subsection (4) must assess—(a) whether the estimates in the transition plan are reasonable,(b) whether the plan identifies the full costs of implementation,(c) whether the methodology and assumptions used to calculate costs and savings are reasonable and have been applied consistently,(d) whether the distinction between gross, net and cash-releasing savings is clear and supportable,(e) whether the expected break-even date is supported by the available evidence, and (f) whether the arrangements for managing risks and maintaining operational continuity are adequate.(6) The person carrying out the review must prepare a report setting out the conclusions of the review.(7) The Secretary of State must publish, alongside the transition plan—(a) the report prepared under subsection (6),(b) the name of the person who carried out the review,(c) a statement of that person’s relevant experience and qualifications,(d) a description of the process by which that person was appointed, and(e) a declaration of any interests which might reasonably be thought to affect that person’s independence.(8) The Secretary of State must lay the transition plan and the report prepared under subsection (6) before Parliament.(9) The Secretary of State must comply with subsections (1) to (8) before making regulations bringing section 1 or 2 into force.(10) In this section—“cash-releasing savings” means a reduction in expenditure which releases resources that may be reallocated without reducing the level or quality of services provided;“front-line health services” means services provided directly for the prevention, diagnosis or treatment of illness, or for the care of patients;“NHS England” means the National Health Service Commissioning Board.”Member’s explanatory statement
This new clause would require the Secretary of State to publish an independently reviewed transition plan before commencing the abolition of NHS England.

[Earl Howe (Con)]

My Lords, in moving Amendment 4, I express my appreciation to the noble Lord, Lord Kakkar, for adding his name to it.

I well recognise that Members of the Committee may be taken aback by the monumental size of this amendment, but its size is, to a very real extent, its point. The main raison d’être of the Bill—indeed, its starting point—is the abolition of NHS England and the reorganisation and reallocation of its functions and responsibilities. That is as monumental a process as it is possible to imagine, involving, as it does, just about every branch of the health service, from commissioners to providers to the training of doctors. More than that, the momentous decision to abolish NHS England came largely unheralded. The report from the noble Lord, Lord Darzi, on the state of the NHS, published in 2024, stated in terms that another top-down reorganisation of the NHS was the last thing that it needed. It seemed quite clear that the noble Lord, Lord Darzi, thought there were other ways of tackling the various issues in the NHS that he had identified.

Whether or not the decision to abolish was taken in haste, I am afraid that what has happened since has been a cause for criticism. The abolition was announced without any explanation given to NHS staff about what the Government were seeking to achieve, and without any provision for redundancy funding. Planning for how the new department would look took months to get off the ground. Even now, some 18 months after the decision was announced, there is still a fog of uncertainty around where a number of commissioning responsibilities are going to sit—whether they will be devolved to ICBs or transferred to the department. Some functions, especially regulation, will need to sit centrally but will require independence from ministerial control; others will need to be devolved nearer to the bodies responsible for delivering patient outcomes. There is, as yet, no clarity on the complete picture.

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[Baroness Merron (Lab)]

The intention is the former, but I will gladly write further to the noble Lord on this point.

[Earl Howe (Con)]

My Lords, I am grateful to the Minister for her wide-ranging response, and to all noble Lords who have contributed to this important debate, which has been very useful.

The Committee has spoken with one voice in underlining the scale and complexity of the task which lies ahead and the importance of ensuring that the abolition of NHS England, or its transformation, as the noble and right reverend Lord, Lord Sentamu, put it, is managed carefully, transparently and with proper accountability.

As I said at the outset, we are not opposed to efforts to reduce bureaucracy or to improve efficiency in the health service. However, we have to be confident that the Government have a clear understanding of the costs involved, the savings which can realistically be achieved and the risks associated with a reorganisation on this scale. Above all, we must not lose sight of the people whom these reforms are intended to serve. The ultimate measure of success must be whether patients receive better, safer and more timely care, rather than simply whether we have succeeded in changing the administrative structure of the NHS.

Despite what she said, I hope the Minister recognises that my amendment was put together as a giant probe of the Government’s transition plans, rather than as a model form of words to be written into the Bill. I therefore welcome her assurance that she will reflect carefully on the concerns that have been raised today, particularly around the need for a clear and independently assessed transition plan. We will consider the Minister’s response ahead of Report. However, for now, I beg leave to withdraw my amendment.

Amendment 4 withdrawn.

Moved by

[Earl Howe]

5: After Clause 3, insert the following new Clause—
“Supply Chain Coordination Limited(1) Before making a transfer scheme under section 2 which relates to shares held by NHS England in Supply Chain Coordination Limited, the Secretary of State must publish and lay before Parliament a report on the proposed future ownership and governance of that company.(2) The report must set out—(a) the person to whom the shares are to be transferred;(b) the reasons for selecting that person;(c) the date on which the transfer is intended to take effect;(d) the person who will exercise the shareholder function during the transfer period;(e) the person who will exercise the shareholder function following completion of the transfer;(f) the arrangements by which the exercise of the shareholder function will be overseen and held to account;(g) any proposed change to the company’s articles of association, governance arrangements, objectives or operating model;(h) the arrangements for ensuring continuity in the procurement, storage, distribution and supply of medicines, medical devices, equipment and other goods required by the health service;(i) an assessment of the principal risks to procurement and supply resilience arising from the transfer;(j) arrangements for managing shortages, disruption or failure of supply;(k) the arrangements for retaining staff with expertise necessary for the continued operation of the company;(l) the contingency arrangements which will apply if the transfer cannot be completed or gives rise to a material risk of disruption;(m) a summary of any independent assurance obtained concerning the proposed transfer and the continuity and resilience of the services provided by the company. (3) The Secretary of State must consult such persons as the Secretary of State considers appropriate before preparing the report.”Member's explanatory statement
This new clause would require the Secretary of State to report to Parliament on the proposed ownership and governance of Supply Chain Coordination Limited before transferring the shares held in that company by NHS England.

[Earl Howe (Con)]

My Lords, Amendment 5 stands in my name and that of my noble friend Lord Kamall. I am grateful to the noble Lord, Lord Hunt of Kings Heath, for his Amendment 211 in this group.

Amendment 5 concerns the future ownership and governance of Supply Chain Co-ordination Limited following the abolition of NHS England. It is a rather more specific amendment than the one we have just debated, but it raises an important question about the wider process of transition, in particular how the Government intend to ensure that essential services and functions continue to operate effectively as NHS England is abolished.

As I emphasised earlier, NHS England sits at the centre of an extraordinarily complex and interconnected healthcare system, with responsibilities, contracts, assets and operational relationships extending throughout the NHS. When we interfere with one part of that system, we need to be certain that we understand what depends upon it. This is particularly important in relation to procurement and supply chains.

NHS England currently holds the shares in Supply Chain Coordination Limited, which plays a central role in the NHS Supply Chain arrangements through which hospitals and other healthcare providers obtain essential equipment, medical devices and supplies. These are functions which may not attract a great deal of public attention, but they are absolutely fundamental to the day-to-day operation of the health service. Hospitals depend on reliable access to medical equipment, consumables and other essential supplies in order to deliver treatment. When those supplies are disrupted, the consequences can obviously be very serious indeed. Procedures can be delayed, costs can increase and clinical staff can find themselves unable to provide the care that their patients need. It is therefore essential that, as the Government undertake this reorganisation, we do not inadvertently destabilise or create disruption in areas of the health service which are currently operating effectively.

That is the concern which this amendment seeks to address. As NHS England is abolished, its shareholding in Supply Chain Coordination Limited will need to be transferred. Our amendment does not seek to prevent that transfer, nor does it prescribe what the future ownership arrangements should look like. Instead, it asks the Government to set out clearly how that transfer will be managed, who will be responsible for the company afterwards and what measures will be taken to ensure that its operations continue without interruption.

There are some fairly straightforward questions here. First, who will assume ownership of the company and who will exercise the shareholder responsibilities, both during and after the transition? It surely cannot be intended that day-to-day control of the organisation will fall to the Secretary of State. But if not, then to whom and under what organisational structure? Secondly, pursuant to that, what governance and accountability arrangements will be put in place? Will there be any changes to the company’s operating model, and, if so, what assessment has been made of their potential consequences? Thirdly, and perhaps most importantly, what assurances can the Government give that the transfer will not disrupt the procurement, storage or distribution of essential supplies across the health service? I would be particularly interested to hear what assessment has been made of the risks involved in transferring these responsibilities and what contingency arrangements will be available if the process proves more complicated than anticipated.

Procurement and supply chain management depend on experienced people, established relationships and systems which have been developed over many years. We know that NHS reorganisation will involve staff cuts. To what extent will this organisation be subject to cuts in staff, and at what levels? What steps are being taken to ensure that the relevant expertise is retained and has any independent assurance been obtained about the resilience of these arrangements during the transition?

More broadly, I regard this amendment as representing a microcosm of the larger questions that surround the abolition of NHS England. The success of this reorganisation will depend not only on whether the Government can transfer functions and responsibilities on paper but on whether the systems that patients and clinicians rely upon continue to work in practice. I hope the Minister will be able to provide some reassurance on these points. I beg to move.

[Lord Hunt of Kings Heath (Lab)]

My Lords, I very much agree with the noble Earl, Lord Howe, that procurement is important in itself, but that it is an illustration, in a sense, of how the new arrangements might play out. Where I disagree with him is that he was really implying NHS Supply Chain is doing a good job, and we do not want to disrupt it. Actually, there are a lot of concerns about the current performance of the supply chain, which I would like to come to, because this is an opportunity to improve what it does, and, in particular, to try and get the relationship between NHS Supply Chain and local NHS bodies on a much better footing.

My Amendment 211 is grouped with Amendment 5 and has the support of the noble Lord, Lord Markham, the former Health Minister, who has been a great advocate of value-based purchasing. I declare an interest as patron of the Health Care Supply Association, the organisation for professionals in health service procurement, who contribute so much to a very important function.

Procurement is there to ensure value for money for the health service, but it can do much more. We know since Covid of the essential need for supply chain resilience. Effective procurement can provide this, ensure investment in innovation and support UK industry. I believe it can link closely with the Government’s ambitions on matters of sovereignty, regional development and growth. NHS Supply Chain has a clear role in this, and it is absolutely right to scrutinise what the arrangements are going to be when the shares transfer from NHS England to the Department of Health.

In particular, I want to raise the shortcomings of NHS Supply Chain. The 2024 Public Accounts Committee report found that NHS England had been weak in its oversight and support of NHS Supply Chain. The PAC reported that neither NHS England nor the department had validated the savings the company reported, and that trusts’ satisfaction with the service was already “in steady decline”. Nor was the committee’s criticism confined to NHS England. It found that the department, which owned the company before 2021, had been “far too lenient” in its oversight.

Returning the shareholding to the department really does not change this one way or the other, but, as I said earlier, it is a chance to put the relationship between NHS Supply Chain, its shareholder, Ministers and the NHS organisation it serves on a much clearer footing. I want to make the point that it is there to serve the NHS. It does not, however, behave in a way that actually recognises that its customers are local NHS bodies. I should say here that there is a view that it is very arrogant in its dealings with NHS bodies. This is what we want to see changed, and I hope ministerial control will actually do something about it.

The ABHI has also reported to me that currently, NHS Supply Chain does not publish the agendas, papers and minutes of its board meetings. I find that very surprising. The noble Lord, Lord Scriven, will raise this in relation to Clause 11, but at the very least I hope to get some assurance that this will be put right.

I also ask the Minister whether, under the department, NHS Supply Chain will continue with its commitment to value-based purchasing. This is very important. I have long argued for it, and the noble Lord, Lord Lansley, is very much with me on this. The point is getting away from always going for the lowest price, and going for quality to improve patient outcomes. I acknowledge we are making progress, and the department itself is very supportive.

I want to quote one example. Value-based purchasing was launched this year to ensure a higher quality of healthcare by raising the standard of procurement. During a pilot in the South Tyneside and Sunderland NHS Foundation Trust, working with Essity, patients were provided with the most appropriate absorbent continence product for their clinical needs and preferences, even if that product was more expensive than other options under consideration. The results showed an 8% reduction in the number of continence products used and a 48% reduction in leaks, and 71% of patients said they would now find it easy to change the product themselves. This is a wonderful example of hugely improved patient outcomes because they did not go for the cheapest products—so this is what this is all based on.

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On Amendment 211, I welcome that my noble friend Lord Hunt, the noble Lord, Lord Lansley, and other noble Lords have been long-time advocates of value-based procurement. I am grateful to your Lordships’ House for the ongoing support for this policy. In June, we delivered on the commitments made in the 10-year health plan and the life sciences sector plan to publish national guidance for value-based procurement for medical technology. I welcome that guidance having shifted the focus of procurement decisions towards value and—I emphasise—outcomes for patients, as well as towards the health system and the environment, rather than just towards the lowest cost. Publishing the guidance is just the first step. The department has set out its implementation plans, including commissioning independent monitoring and evaluation of the guidance, with annual reports over the next three years—which of course will be published—on the impact of the guidance. It is the intention that business as usual means value-based procurement when it comes to NHS procurement teams purchasing medical devices, consumables and services. Our existing reporting arrangements will help to ensure that this is the case.

[Earl Howe (Con)]

My Lords, I am grateful to the Minister for her response and to all noble Lords who have contributed to this debate. I am particularly grateful to the noble Lord, Lord Hunt of Kings Heath, for his insights into the performance of the NHS Supply Chain and its current shortcomings. I was also very impressed by his advocacy in favour of value-based procurement—which, incidentally, I would distinguish from value-based pricing, a policy in relation to which, as a former Health Minister, I bear the scars. I very much agree with the noble Lord, Lord Scriven, that we need reassurance that responsibility for value-based procurement will rest with NHS Supply Chain with active ministerial support. We heard the necessary reassurance on that from the Minister.

I admit that the criticisms of NHS Supply Chain voiced by the noble Lord, Lord Hunt, are ones that I chose to gloss over, because, as I said at the outset, my concern was simply to ensure that the abolition of NHS England does not disrupt the essential services and systems on which the wider health service depends. NHS Supply Chain is an important example of this, and we must be confident that its future ownership and governance arrangements are properly considered and that continuity of supply is protected throughout the transition. I was largely reassured by what the Minister had to say about this but will study her reply carefully. Ultimately, changes to the administration of the NHS must not come at the expense of its ability to deliver care to patients.

I hope that the Government in turn will reflect on the points raised today, but for now I beg leave to withdraw my amendment.

Amendment 5 withdrawn.