Health and Social Care Bill

Lord Hunt of Kings Heath Excerpts

Monday 13th February 2012 Lords Chamber

[Baroness Emerton]

My Lords, I support the amendments in the name of the noble Lord, Lord Patel, from the point of view of other healthcare professionals—our debate has focused mainly on medical professionals to date. The noble Lord was careful to relate his Amendment 16 to all healthcare professionals. We need to make sure that Health Education England is multiprofessional in its focus. However, the amendment makes no mention of any links with social care. I am aware that we will debate social care in the spring, but it is important that healthcare professionals have included in their programmes and curriculum information on social care.

Amendment 16 mentions workforce planning, which must be a joint exercise between healthcare education and commissioning. The professions will be reassured if they know that workforce planning will be shared between the two rather than it being the concern of health education or commissioning alone. I support wholeheartedly Amendment 13, which encompasses all our discussions and brings to the fore the need for wholeness in healthcare professional education.

[Lord Hunt of Kings Heath]

My Lords, I support Amendments 13 and 16. This debate follows on from our useful discussions on education and training last week. Once again, we see a tension between the need for a national strategy on education and training and the need for local ownership. Amendment 16 in the name of the noble Lord, Lord Patel, gives us that, and I hope that the noble Earl will be sympathetic to it.

We all know about the problems that have arisen in the past where there has not been sufficient national leadership. Decisions about training places have been left to local bodies and the budget has been squeezed, the result being that a few years later there have not been enough people coming into the National Health Service, which has had a very damaging impact. I think there is unanimity in your Lordships' House that there has to be a very strong national strategy.

I very much take the point made by the noble Baroness, Lady Emerton, that there must be co-ordination in workforce planning between Health Education England, as the national strategic body, and commissioners, but I would add providers because it is they who will employ the staff who have been trained. It is essential to get our workforce planning and our commissioning at a national level into sync. It is more an art than a science, and I suppose that it has never been achieved to 100 per cent satisfaction. None the less, that is what we should strive to do. Speaking as a foundation trust chair, I say to noble Lords who have discussed the national element of this that it is vital that NHS trusts and foundation trusts play a full part in the discussions. At the local level, the local education boards have a crucial role to play.

I very much support the argument of the noble Lords, Lord Patel and Lord Kakkar, on independent chairs and transparency. That is important, but it is also important that the education providers feel sufficient challenge from local NHS bodies when it comes to the quality of their education and training. I am sure that we will come later to the issue of nurse education and training. There are some real issues about the quality of nurse education and training in our universities. It is important that the local education bodies and employers provide sufficient challenge to the work of the universities. I hope that in accepting the need for an independent chair, noble Lords will agree that there should be no cosy relationship between commissioners, who ultimately have no real responsibility for the employment of staff, and universities. Unfortunately, the current system has led to too cosy a relationship. I look to the noble Earl, Lord Howe, for recognition that NHS trusts and foundations have to be very much around the table.

It would be useful if the noble Earl replied to the noble Lord, Lord Kakkar, and gave some sense about where postgraduate deans are to be placed within the new structure. I also hope that postgraduate deans will be able to recognise that in the new circumstances they can have a huge impact on NHS trusts and foundation trusts when it comes to their visitations. I also hope that clinical commissioning groups will recognise that if they are going to start shifting resources away from NHS bodies, that might have an impact on their capacity to provide education and training in the future.

That brings me to the point raised by the noble Lord, Lord Kakkar, about whether private providers will have contractual obligations with regard to education and training. It is important that there is a level playing field. If the Government insist on more contracts being placed with private sector providers in the future, there will have to be obligations on the part of providers. It would be grossly unfair and in the end it would not lead to the establishment of a national coherent system if private sector providers did not pay their fair share.

On governance, again, the noble Lords, Lord Patel and Lord Kakkar, made some substantive points about local education and training boards. It would also be helpful if the noble Earl responded to the point raised about academic science networks. We all agree that we must make the most of the fantastic basic education and science capacity in this country, and the links with the provision of patient care and the pharmaceutical industry. They have great potential. It would be useful to know how the noble Earl thinks they will fit into the new structure and particularly how they will link to the postgraduate deans and the academic science network. Overall, I am sure that the noble Earl will be able to come forward with a constructive response and I certainly hope that he is prepared to accept Amendments 13 and 16.

[Earl Howe]

My Lords, as I set out in our previous discussion on education and training, the Government are putting in place a strong national system for education and training, with a strengthened focus on quality outcomes.

We have introduced a clear duty on the Secretary of State to ensure that such a system is in place, and are now making good progress with establishing Health Education England and the local education and training boards. We are acutely aware of the importance of a safe transition to the new system and are proceeding with care and at a sensible pace to ensure the new system is fully up and running by April 2013.

As noble Lords will be aware, we have confirmed that we will set up Health Education England as a Special Health Authority in June 2012, so that it can take on some operational functions from October 2012 and be fully operational from April 2013, when it will take on the strategic health authority education and training functions. I repeat those assurances today. It will have an independently appointed chair and non-executive appointments. For this reason, we do not think that that part of Amendment 16, tabled by the noble Lord, Lord Patel, and others, which would place a duty on the Secretary of State to set up Health Education England as a new special health authority, is necessary.

I hope that the undertaking will be sufficient by way of reassurance to noble Lords on that score. Nevertheless, in addressing the more detailed issues set out in that amendment, it would be helpful to elaborate a little on what I was able to tell the House last week.

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On the subject of quality, one of Health Education England’s key functions is to promote high-quality education and training that is responsive to changing needs of patients and, indeed, local communities. Quality standards will prove to be of key importance in the contracts that LETBs will hold with higher education institutions, as will the postgraduate deans, of whom I shall speak in a moment. Employers and healthcare professionals will play a leading role in workforce planning and development through the establishment of local education and training boards, working with the education and research sectors. The local boards will identify and agree local priorities for education and training, and plan and commission education and training on behalf of their local health community. The boards will bring together all healthcare and public health employers providing NHS-funded services with education providers, including universities and colleges, the professions, local government and the research sector—and, I can tell the noble Lords, Lord Kakkar, Lord Winston and Lord Hunt, including as well the emerging academic health science networks. We see that element as particularly important. I can tell the noble Lord, Lord Kakkar, that each local board will have an independent chair and that we do not expect the chair to be drawn from employers within the LETB geographic area—it should be an independent person.

[Lord Hunt of Kings Heath]

On that welcome news, I assume that would mean that it would also not involve having a higher education chair and that, in fact, to have an independent chair means that they should be independent of commissioning, providing and university providing.

[Earl Howe]

That is a logical inference but, if I can get further and better particulars for the noble Lord, I would be happy to do so. Each local board will set up local advisory arrangements to reflect the breadth of local interest and ensure that its decisions are informed by clinicians, clinical networks and education providers. My noble friend Lord Willis and the noble Lord, Lord Winston, asked about “any qualified provider” and whether non-NHS providers will have to play their part. Yes, indeed; all providers of NHS services will be expected to participate in education and training activities, and Health Education England will invest only in organisations which do that. The answer to the question from the noble Lord, Lord Hunt, is indeed yes. He is correct.

By April 2012, we expect the strategic health authorities to establish sub-committees that will develop the emerging local education and training boards. The role of strategic health authorities to lead on education and training has been extended until April next year. When Health Education England is fully functional as a special health authority from April 2013, it will then, as I have explained, take on the responsibility for hosting the local boards. There are plans for a safe and effective transition to the new system, which will ensure that the strategic health authority functions for education, training and workforce planning, including the work of the postgraduate deaneries, are continued. LETBs will take on these education and training functions and it is expected that many SHA and deanery staff will migrate to the local boards to ensure continuity and essential skills and knowledge for the future, subject to affordability.

As I emphasised in our earlier debate, postgraduate deans will continue to be a critical part of the medical training arrangements. We expect LETBs to be able to demonstrate that their postgraduate deans will be able to act independently so as to be able, among other things, to provide challenge where necessary—a point raised, quite rightly, by the noble Lord, Lord Hunt. There will be systems and indicators in place to hold local education providers to account for the quality of education delivered by individual providers. Postgraduate deans will have all the powers that they have now to respond to any concerns about the quality of training, and to take action where required to improve standards and to assure the professional regulators, and indeed Health Education England, that poor performance is being tackled. In the new system, they will have support from the LETBs themselves and, if necessary, from Health Education England to challenge poor quality and behaviours.

Our proposed funding mechanisms reinforce that focus on quality by putting responsibility for education and training decisions in the right place, to be transparent so that funding follows the student on the basis of quality and value for money. The MPET budget will, as now, be predominantly provided to support the next generation of clinical and professional staff. Local boards will have some flexibility to invest in innovative approaches to continuing professional development and the education and training of the wider workforce. Health Education England will be responsible for developing a more transparent allocations policy for distributing education and training funding to local boards.

Now that the policy framework has been worked out, we need to push on and get the foundations of the new education and training system in place. We are doing that by establishing Health Education England and supporting the development of the emerging LETBs. It remains our intention to consolidate the functions of Health Education England by establishing it in primary legislation as a non-departmental public body. That will enable it to operate on a permanent statutory basis at arm’s length from the Department of Health while remaining accountable to the Secretary of State.

We want to do all this on the basis of consensus. We want to ensure that people with an interest have the opportunity to comment on and feed into the design of the new system, ahead of bringing forward the primary legislation in a second Bill. With that in mind, we intend to publish draft clauses on education and training for pre-legislative scrutiny in the second Session to ensure that the legislation is fit for purpose and to give Parliament an additional opportunity to scrutinise the proposals. I add that our vision for an education and training system that gives greater responsibility to employers and health professionals has been warmly welcomed.

As noble Lords will see, we have tabled amendments to strengthen links with the wider system. We have already discussed government Amendments 61 and 104, which would place duties on the board and on CCGs to promote education and training. These amendments were accepted in a previous debate. They are designed to ensure that commissioners of NHS services consider the planning, commissioning and delivery of education and training when carrying out their functions. The noble Lords, Lord Patel and Lord Warner, have tabled the very similar Amendments 62 and 106, and I hope that they will be reassured by the amendments that we have tabled and will feel able to withdraw them.

The noble Lord, Lord Patel, has tabled Amendment 13 on the role of providers. I say straight away that I am sympathetic to his intentions and I have given the amendment significant thought since it was first put down. In the beginning I thought that an amendment might not be needed, given that, in order to be established, LETBs will need to demonstrate that they meet robust authorisation criteria set by Health Education England, including demonstrating that all providers of NHS-funded services are fairly and properly represented in the LETB’s business.

At this point I shall answer the question posed by my noble friend Lord Mawhinney about the estimated costs of the amendment. I understand that Amendment 13 would be delivered by requiring commissioners to place a duty of this kind in their commissioning contracts. We do not anticipate any additional costs as a result of the amendment. Employers have told us and the Future Forum that they are keen to participate and play a leading role in the planning and commissioning of education and training through the LETBs, and of course we plan to legislate further for education and training, which will provide the opportunity to consider any duties that might be required of providers.

However, the amendment is satisfactorily drafted. In the light of what the noble Lord and others have said today in support of it, and in recognition of the strength of feeling on the issue, I can tell the noble Lord that I am willing to accept his proposal and support the amendment.

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Moved by

[Lord Hunt of Kings Heath]

18: After Clause 7, insert the following new Clause—
“The Secretary of State’s duty as to preventing bureaucracy
After section 1F of the National Health Service Act 2006 insert—“1G Duty as to preventing bureaucracy
In exercising functions in relation to the health service, the Secretary of State must, so far as in consistent with the interests of the health service, act with a view to securing—
(a) that the NHS Commissioning Board shall exercise its functions in relation to the health service with a minimum level of management tiers, and(b) that any other person exercising functions in relation to the health service must have regard to the need to curb bureaucracy.””

[Lord Hunt of Kings Heath]

My Lords, one by one, the pillars holding up the Government’s reasons to justify the mayhem they are raining on the NHS are being kicked away. The Prime Minister promised “no top-down reorganisation” of the NHS, yet it is faced with the biggest change since it started life 64 years ago. The Government implied that the NHS was failing, yet the 2010 British social attitudes survey put public satisfaction with the NHS at its highest-ever level. The Government have said that falling productivity is a problem, yet Professor Nick Black, writing in the Lancet, described this as a myth. The Government said they wanted to encourage collaboration and the integration of services, yet Mr Lansley spilled the beans this morning by making it clear that competition between doctors and nurses is really what he is about.

The Government argue that they will end micromanagement by the Secretary of State and introduce democracy. Last week, the noble Earl, Lord Howe, on the first day of Report, sought to persuade your Lordships that the Government are aiming to free the service from micromanagement by the Secretary of State. Indeed, the noble Earl went further and said that Mr Lansley is the only Secretary of State,

“who has not succumbed to the temptation of micromanaging the NHS”.—[Official Report, 8/2/12; col. 349.]

The noble Earl went further when he said that the NHS Commissioning Board will have a facilitating role to promote guidance, and is,

“not … a replica of the kind of line management that the NHS has seen to date”.—[Official Report, 8/2/12; col. 352.]

I say gently to him that the reality seems a little different. Indeed, since your Lordships started to debate the Bill, the Secretary of State has shown no inclination whatever to keep his hands off the National Health Service. He has announced a set of indicators for patient outcomes for NHS trusts to meet; he has pronounced that hospitals are admitting too many patients; he has pronounced that patients are being discharged from hospitals too quickly; the A&E four-hour indicators have been extended; primary care trusts have been told to speed up treatments for patients waiting longer than the 18-week waiting limit; hospitals have been ordered to remove advertisements for personal injury lawyers in NHS-branded leaflets from being distributed in casualty wards; primary care trusts have been told to identify three services that can be handed over to the private sector; and the Prime Minister—no less—has announced that there will be hourly nursing rounds to check that patients are properly fed and hydrated. I might have missed a few examples in my recording of the interventions that have taken place in a short period of time.

[Lord Graham of Edmonton]

Keep going.

[Lord Hunt of Kings Heath]

My noble friend urges me to keep going. I will certainly continue to note down the evidence on whether the Secretary of State is not micromanaging the National Health Service.

Let me make it clear to the House that I do not have a problem with those kinds of interventions. In fact, I wish the NHS could be left to get on with dealing with some of those issues rather than having to be diverted by this centrally imposed top-down restructuring.

I do not think that we should let the Government get away with the myth that what they are proposing is some kind of anti-bureaucratic Minerva or kid us that they are standing back from interfering in the NHS. I have no doubt that the noble Earl, Lord Howe, will regale us with how many reductions there are in the number of bureaucrats employed in the NHS. He will probably pass over the huge redundancy costs that are being paid out. He might also pass over the possibility of there being a cost-shift as clinical commissioning groups, for instance, hire the very people made redundant by strategic health authorities and primary care trusts.

The fact is that the Government are busy constructing a huge edifice of confusion and a multilayered decision-making process. I remind the House that the Commons Health Select Committee report on 24 January concluded that the Nicholson challenge, the £20 billion efficiency challenge,

“can only be achieved by making fundamental changes to the way care is delivered”.

It continued:

“The reorganisation process continues to complicate the push for efficiency gains. Although it may have facilitated savings in some cases, we heard that it more often creates disruption and distraction that hinders the ability of organisations to consider truly effective ways of reforming service delivery and releasing savings”.

Let me be clear. In criticising the Government's approach, I do not seek to undermine the role of managers and leaders in the NHS. They are at a premium, and I have been somewhat concerned by the tenor of some of the Government's remarks about the role of managers in the health service. We need good managers to lead and support change on this vast scale. What we do not need are layers and layers of bodies without any clarity in organisational responsibilities. We do not need systems and practices that mean that the same information is collected many times over, and we certainly do not need the increasingly complex paperchase that the internal market will morph into when it becomes a real market.

In essence, the Government are replacing a managed-system bureaucracy with a market bureaucracy. Monitor and the national Commissioning Board will grow and grow, mostly by spending on external consultants to mask the baseline costs. Here I return to the point made by my noble friend Lord Graham. Again, one sees a plethora of organisations in the new structure. We have Monitor, with its hugely contradictory role in both supporting the foundation trusts and being the economic regulator for the NHS. We will have the national Commissioning Board overseeing the system in accordance with a mandate given to it by the Secretary of State. However, the board, which the noble Earl, Lord Howe, talked of as being a facilitating organisation, will none the less have a massive £20 billion commission of services. The national Commissioning Board will also have four regional outposts and 50 local outposts. The noble Earl called them field forces last week, but I suspect that the jargon has moved on since then.

We then have 244 clinical commissioning groups, at the last count, but because the clinical commissioning groups do not have the skills to commission services we are also to have 35 commissioning support units. Then there are the clinical senates—15, perhaps—but no one has any idea who they will be, what they will do or who they will be accountable to. We then have 165 local authorities taking over responsibility for the public health function, 165 health and well-being boards and the same number of local healthwatches. As we heard earlier, the local education and training boards are accountable to Health Education England. Then there is the leadership academy and the improvement body that the noble Earl referred to last week.

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[Earl Howe]

My Lords, during the passage of the Bill we have had much discussion about the importance of freeing front-line professionals from needless bureaucracy and ensuring that they are able to focus on patient care—not least when we considered the duties of autonomy. This is one area where the House is in agreement. Certainly one aim of the Bill is to reduce bureaucracy and micromanagement, prevent politicians in Whitehall second-guessing the decisions of doctors and nurses, and streamline the architecture of the NHS.

The noble Lord, Lord Hunt, indulged himself in one of his occasional rhetorical forays, which I enjoyed. However, the amendment is rich coming from him. Perhaps I should remind the House that the previous Government did to management costs what the noble Lord accused us of doing. Since 2002-03, the management costs of PCTs and SHAs have increased by more than £1 billion—a rise of more than 120 per cent. The Bill aims to get a grip on a problem that under the previous Government simply got out of control. The noble Lord will know that my department has confirmed an overall running-cost budget of £492 million. That represents a 50 per cent reduction in costs and staff compared to the current cost of functions that will transfer to the board. At board level, the work previously done by 8,000 people will be done in future by approximately 3,500 full-time equivalent people. That is a major reduction.

The amendment tabled by the noble Lord seeks, first, to introduce a new duty on the Secretary of State to prevent bureaucracy and, secondly, to minimise the layers of management tiers within the Commissioning Board. The noble Lord produced a confection of arguments to bolster his case that bureaucracy in the NHS is increasing rather than diminishing. I can tell the House that the opposite is true. In saying that, I should stress that I am not in any way denigrating NHS managers. I have never done that and I will never do it.

Setting aside the noble Lord’s knockabout routine and getting back to earth, I agree with the principle behind this amendment. Noble Lords will already be aware of the autonomy duties, which we have recently amended, in no small part due to the Constitution Committee. Those duties ensure that proper consideration is given to whether any requirements or objectives set by the board or the Secretary of State will place unnecessary burdens on the health service or distract from good quality patient care. In addition, the Bill places duties on the NHS Commissioning Board, CCGs and other bodies to exercise their functions effectively, efficiently and economically. That is in new Section 13D of the National Health Service Act 2006 for the board and new Section 14P for CCGs. Together, I believe that these provisions ensure that the duty to maximise efficiency and minimise bureaucracy is embedded throughout the system. We do not need anything further.

The noble Lord, Lord Warner, asked me a question that I have been asked before in these debates. It concerned why we did not simply reform the PCT model. We chose not to try to reform the PCT model because it would not have delivered the empowered clinical commissioners we want to see and, indeed, the Opposition want to see. This Government supported the principle of practice-based commissioning, but there is one thing to say about practice-based commissioning: it was not working. It did not live up to the ambitions that people had for it. Central to this was clinical commissioners’ lack of autonomy. Only by conferring functions directly on clinical commissioners, as this Bill does, can that autonomy and responsibility be properly established.

Subsection (a) of the noble Lord’s amendment refers rather bafflingly, as my noble friend Lord Fowler pointed out, to a minimum level of management tiers. I am not quite sure how that would be interpreted by the courts, but I believe that the noble Lord is drawing attention to the published proposals for the board’s organisational structure. In line with the vision we set out in the White Paper, the proposals put forward make clear that the board will be a single nationwide organisation that will work across the country to improve quality and outcomes. However, there are some who have focused on the board’s proposal for a maximum of five layers of management, claiming that this represents some sort of increase rather than a reduction in bureaucracy. That is not the case. The structure proposed by the board is based on sound and well recognised principles of effective organisational structure. The proposed organisational structure for the board is designed above all to support it in its overarching role to improve health outcomes. What surely matters is the board’s efficiency and effectiveness. In fact, as I have already said, the board will operate with a 50 per cent reduction in running costs in comparison with the current system. I am not attracted to the part of the amendment that requires the Secretary of State to influence the number of management tiers in the NHS Commissioning Board. Apart from being inappropriate, it is unnecessary. The Bill already makes clear that the Secretary of State sets the resource limit for the board and new Section 223E of the 2006 Act allows him to impose a cap on administrative spend. Together these provisions ensure that financial limits are placed on the board, which will necessarily influence the way in which it is structured. However, I believe it would be inappropriate for the Secretary of State to go any further than this in influencing the organisational design of the board. The board is the body best placed to determine how to organise itself in the most effective and efficient way. It is therefore our intention to allow it as much autonomy as possible in determining its own membership, structures and procedures.

All our proposals for modernising the NHS, including the provisions in the Bill, are designed to minimise bureaucracy, micromanagement and unnecessary waste to enable the whole system to focus on what really matters, which is patient outcomes. For example, the outcomes framework will directly link quality improvement and outcomes with commissioning; clinically-led commissioning groups will be judged, through the commissioning outcomes framework, on whether they improve patient outcomes and experience rather than process targets; the NHS Commissioning Board will hold GP commissioners to account for their performance against NICE indicators; and CCGs will hold providers to account for driving up quality improvement using contracts and incentives. It is quality and outcomes that matter and with the safeguards already in place to limit administrative spend throughout the system, I believe that the noble Lord’s amendment is unnecessary. I hope that he will feel able to withdraw it.

[Lord Hunt of Kings Heath]

I must say that I am really rather disappointed by the noble Earl’s response to my constructive amendment. He does not seem to have answered the charge that is being made. First, I think we are all agreed that when we talk about bureaucracy we are not talking about the fine managers that the NHS has to whom we owe so much. This is an argument about the structure, the layers and the cost of a market that the Government wish to bring in to the health service. It is not about managers in the health service.

The fact is that the Secretary of State and his colleagues, including the noble Earl, have continued to intervene in the health service on a daily basis. They have yet to explain how, if this Bill eventually receives Royal Assent, at that point, magically, Ministers are going to step back and simply let this new system continue. I do not believe a word of it. What I believe will happen is that on the one hand you will have this complex structure where the mantra is that it is all arm’s length, it is all down to the clinical commissioning groups, the market and the gentle guidance of Sir David Nicholson and his colleagues at the national Commissioning Board, and Ministers can simply step back. It will not happen. What we will have is the system that the Bill enacts, if it is enacted, and Ministers continuing to micromanage. It is inevitable that Secretaries of State are accountable to Parliament, and they will be required by the very process of parliamentary democracy to continue to intervene and to take a close interest in what is happening. That is the charge I put to the Government as to why I believe that this is going to be a very complex situation indeed.

It is always good to debate with the noble Lord, Lord Fowler. Twenty years ago, I enjoyed debating with him issues mainly to do with the funding of the National Health Service. I think the National Association of Health Authorities and Trusts was a very modest organisation. It was very lean and certainly not subject to the strictures of the noble Lord who suggested that it was part of the bloated bureaucracy that I think he was implicating me in. He does not like the idea of declaratory law. That is all very well, but what is Clause 4 but a declaratory statement: “The Secretary of State’s duty as to promoting autonomy”? Indeed, the noble Earl, Lord Howe, referred to it in his winding-up speech. I have to say to him that if the duty of autonomy were currently on the statute book, I do not think that he could have brought this legislation in under it because it states that,

“unnecessary burdens are not imposed on any such person”.

This whole edifice is going to impose enormous burdens on many such people within the National Health Service.

The noble Lord, Lord Fowler, referred to the Griffiths report—at 24 pages, it was a remarkable letter which had a long-term impact on the health service. He will recall that we were very strong supporters of the introduction of general management. I am very concerned about the structures that are now being brought in because they may well inhibit the kind of leadership and clinical engagement that we saw as a result of the Roy Griffiths management inquiry.

I have to say to my noble friend Lord Harris that the description of Sir David Nicholson as the chief inquisitor was a little unfair.

[Lord Harris of Haringey]

But only a little.

[Lord Hunt of Kings Heath]

All of us who have worked with Sir David will know that he is a very fine manager and I am very glad that someone of his calibre is in that position.

The worry is that although the national Commissioning Board is going to be one organisation, it will have different layers and at the local level it will be very powerful. If there are, say, 50 local offices of the national Commissioning Board, given the smallness of clinical commissioning groups—the Government have followed us into the trap made when we created too many primary care trusts—when it comes to the real issues at local level and the kind of leadership of a system that goes across local authority boundaries and covers populations of around 1 million to 2 million, the clinical commissioning groups are simply not going to be big enough to provide the kind of strategic leadership that is required. Inevitably it is going to fall to the local office of the national Commissioning Board. I worry that there is no accountability because these will be simply the outposts of a national body.

However much one might criticise primary care trusts or strategic health authorities, the fact is they had a majority of non-executive directors on their boards, they met in public and they felt some local accountability. The local offices of the national Commissioning Board will have no such feel because their sole accountability will be to the national Commissioning Board at national level. Alongside that, we see from Mr Lansley’s article in the Health Service Journal that he is very keen on the implementation of a market. We know that that will come at a price—in terms of the complexity of contract-making and of legal costs and certainly in the profits that private sector companies will wish to take out of the National Health Service.

This is a very complex structure that the Government are introducing. My amendment is a helpful reminder to the Secretary of State that there should be a very clear presumption that the kind of bureaucratic monstrosity that is now being introduced ought not to be introduced. I wish to test the opinion of the House.

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Moved by

[Lord Hunt of Kings Heath]

19: Clause 8, page 4, leave out lines 10 to 21 and insert—
“(2) The Board has the function of arranging for the provision of services for the purposes of the health service in England in accordance with this Act and subject to any directions issued by the Secretary of State.
(3) The Board must exercise the functions conferred on it by this Act in relation to clinical commissioning groups so as to secure that services are provided for those purposes in accordance with this Act.
(3A) The Secretary of State may give a direction to the Board to discharge each of those functions, and in such manner and within such period or periods, as may be specified in the direction.”

[Lord Hunt of Kings Heath]

My Lords, Amendment 19 comes back to a theme which takes us to the overriding responsibility of the Secretary of State for a comprehensive health service and to the relationship between the Secretary of State and the national Commissioning Board. I do not want to go over the ground that we went over in the previous debate but I want to make just two or three points.

The Minister will recall that in Committee we debated the whole question of the concurrent power being given to the national Commissioning Board in relation to the Secretary of State’s responsibilities in Clause 1. Given Clause 1 and our really important debates on it, and the welcome agreement on the first day on Report regarding the way in which an amendment was accepted to make clear that the Secretary of State is accountable to Parliament for NHS provision, I remain concerned as to whether it is right that a body such as the national Commissioning Board should carry such responsibilities as well—that it should have a concurrent responsibility and duty.

Surely, ultimately, the national Commissioning Board is a secondary body as compared to the Secretary of State. The very fact that there is a mandate in which the responsibilities and duties of that board are laid down on a regular basis by the Secretary of State reinforces the proper relationship between an unaccountable body, such as the national Commissioning Board, and an accountable person, such as the Secretary of State. I should be grateful if the Minister would give further reflection as to whether a concurrent power really is the appropriate way in which that relationship should be set out.

Of course, that is associated with the power of intervention by the Secretary of State. It seems to me that in the end, since the Secretary of State is accountable to Parliament for provision and for ensuring a comprehensive service, if he feels that the national Commissioning Board is not doing the right thing or that there is a matter which requires the intervention of the Secretary of State, it is right that that intervention can be taken out without obstruction or legislation. In my view, that would lead to a confusion of role as between the Secretary of State and the national Commissioning Board.

When we discussed this issue in Committee, I asked the Minister what would happen if there was an issue. Let us take, for instance, some of the recent interventions by the Secretary of State. He has expressed concern about the way in which primary care trusts have manipulated waiting lists. Rightfully, in my view, he sought to intervene. How would you do that under the new arrangements if clinical commissioning groups or some individual clinical commissioning groups were not doing what the Secretary of State thought to be appropriate?

From our debate in Committee, I had the impression from the Minister that in those circumstances provision could be made in the mandate set for the board by the Secretary of State. I can see that every so often you can alter the mandate to deal with an issue like that. But sometimes he will need to intervene rapidly rather than have to wait for the process of a mandate to be set. I also suspect that there is a risk that the mandate could become very detailed and prescriptive—in other words, the micromanagement that the Minister is so keen not to see introduced. There will be issues that arise during the year which might not have been envisaged when the mandate was drawn up.

The noble Earl may well say that we will have the intervention powers set out in proposed new Section 13Z1 set out on page 24. My problem with this is that the wording constrains the intervention because it has to be based on a failure to discharge or a failure properly to discharge any of its functions, and the failure is significant. Of course, the intervention none the less is based on what the Secretary of State himself considers, and no doubt he would always be properly advised by his officials and, in extremis, the Government Law Officers. But I can envisage situations in which the NHS Commissioning Board actually rejects the Secretary of State’s view and where it would be deemed that the issue is not one that comes under the auspices that could lead to intervention under Section 13Z1. I think that there should be a clear right in the Bill for the Secretary of State to have a power of direction.

In the end the sole accountability of the national Commissioning Board has to be through the Secretary of State and thus to Parliament. The board is not elected; it is an appointed body. There has to be full accountability, and for me, one element of that accountability is that the Minister responsible to Parliament has the right to tell that body what to do. I feel very uncomfortable with a body that is floated off. Okay, we have the mandate, but in the end it is not an accountable body except through the relationship it has with the Secretary of State, so it is right that the Secretary of State should issue direction powers without being fettered as I believe he is in Section 13Z1.

I do not think I need to mention the other two amendments at great length. Amendment 23 merely tries to encourage the noble Earl to say that clinical commissioning groups have the function of safeguarding the comprehensive provision of NHS services. It is very important that within all the autonomy that the Secretary of State wishes to give the clinical commissioning groups, it is made clear that they must, none the less, sign up to the overriding responsibility of anyone involved in the NHS to ensure that comprehensive provision is safeguarded. Amendment 70 is really consequential on Amendment 19. I beg to move.

[Earl Howe]

My Lords, Amendments 19 and 70 seek to reintroduce the Secretary of State’s powers to direct the health service. I have listened with care to what the noble Lord has said, but I continue to believe that this would be a retrograde step on every count, not least that of transparency. Under the Bill as it stands, the Secretary of State will be able to set objectives and requirements both through the mandate and through “standing rules” regulations under Clause 19, but unlike directions, these would be subject to full scrutiny, and the Bill creates a clear expectation that they would be set only once a year in order to provide certainty for planning. Ministers would also have robust intervention powers in the event of significant failure, as the noble Lord mentioned.

The system we are creating is designed to be predictable, transparent and structured, and will provide stability for the health service. I think that this is a better approach than allowing the Secretary of State to direct the health service whenever he wants, which risks returning us to the unpredictability and opaqueness of the current system. The noble Lord described the Commissioning Board as “unaccountable”. I must scotch that myth. The Secretary of State will have wide-ranging powers over the Commissioning Board, most prominently through the mandate and the standing rules, which will enable the board to be held rigorously to account. In addition, the board will have to meet in public, produce a business plan and an annual report, both of which will have to be laid before Parliament. Further, I would remind the noble Lord of Clause 51, which covers the,

“duty to keep health service functions under review”.

The process of holding the board to account is not a once-a-year task. In turn, the Commissioning Board will hold CCGs to account for the quality outcomes they achieve and for financial performance—and, again, will have the power to intervene where there is evidence that CCGs are failing or likely to fail to fulfil their functions. If the Commissioning Board fails to hold CCGs to account, the Secretary of State could then direct the board to do so. If the board failed to comply with that instruction, the Secretary of State could either discharge the function himself or make arrangements for another body to do so on his behalf. So it is quite wrong to say that there are no levers available to the Secretary of State.

I turn now to Amendment 23, which emphasises the need for clinical commissioning groups to safeguard,

“the comprehensive provision of NHS services”.

Noble Lords will recall that the House has already agreed an amendment to Clause 12 which explicitly requires CCGs to act consistently with the discharge by the Secretary of State and the Board of their duties to promote the comprehensive health service, and with the objectives and requirements in the mandate.

I fully appreciate and support the intentions behind this amendment, and I hope that the discussion we have already had and the amendment we have already discussed to Clause 12 will offer the noble Lord a reassurance that the effect of this amendment is already covered in the Bill. In the light of what I have said, I hope that he will feel able to withdraw the amendment.

[Lord Hunt of Kings Heath]

My Lords, I am grateful to the noble Earl, Lord Howe, particularly for his remarks in relation to Amendment 23. Clearly we are not going to agree about this matter. I do wish that the late Lord Marsh could still be present because he would have enjoyed these debates. I think that he would have reminded us of the traditional relationship between the chairman of the board of a nationalised industry and the Minister responsible to Parliament. Although we have lost those nationalised industries, in one sense the Department of Health is now busily engaged in setting up the kind of structure that in many ways is akin to those industries. That is because the chairman and chief executive of the national Commissioning Board are, in essence, being handed a huge amount of power by the Secretary of State. They are to be given the budget, the mandate and the standing rules, and are to be told to get on with it. If we go back to our experience with the nationalised industries, of course it never worked because there was a continuous tension between the board of a nationalised industry and the Minister which arose from the fact that the Minister was accountable to Parliament for the running of the railways, iron and steel and the coal board.

That is exactly what we are constructing today. We have the myth that simply by having a mandate and standing rules, we can say to the national Commissioning Board, “Get on with it. I as a Minister will no longer intervene unless in extremis”, under the circumstances set out in Bill. Life is not like that. Parliament will continue to debate the health service, issues will arise and Ministers will make pronouncements. I do not believe for a minute that the 12 or so pronouncements we have heard from Ministers over the weeks that this Bill has been in your Lordships’ House will not be followed by similar pronouncements under the new structure. They will be forced to do so because Parliament will require it. That is the risk and why I believe it is such a complex system. On the one hand there is a structure which is based on an arm’s-length relationship, a market, with clinical commissioning based on a mandate, while on the other hand there is still the Secretary of State who will be fully held to account in Parliament. There will be enormous tension and great confusion within the National Health Service. For that reason, there is a strong argument for accepting that, in the end, the Minister is accountable and ought to have a power of direction. Saying that this can be done through a mandate and standing rules is not realistic, and no doubt, if the Bill is enacted, we will see this played out. I do not think anyone should be under the misapprehension about the fact that we are building into these arrangements a very unstable situation. But we have had a good debate, and I beg leave to withdraw the amendment.

Amendment 19 withdrawn.