Health and Social Care Bill

Lord Newby Excerpts

Monday 19th March 2012 Lords Chamber

[Lord Noon]

My Lords, I speak in support of Amendments 1 to 6. I add my thanks to the Minister for his support in seeking to improve this Amendment, which I believe has been done in a number of ways. I should also declare an interest in these matters as chair of the Noon Foundation, which provides financial support to charities and other not-for-profit organisations, including those caring for people in end-of-life situations, such as the Marie Curie Cancer Care charity.

As a philanthropist and a businessman, I understand very well the importance of having a level playing field. We all know the immense value that is provided by charities, social enterprises and small voluntary agencies. I believe that they form the bedrock of our society. They provide essential support and care to those who are most in need, and do so on a daily basis.

The VAT issue for me is very clear. As someone who provides funding for charitable work, I do not want to see those funds taken up paying VAT that was not charged to the NHS when it provided the service. However, we need to go beyond VAT and look at all the barriers faced by the not-for-profit sector. As a business man, I understand the significant risks taken on in any new enterprise. There must be adequate time to accumulate capital, contracts must be fair and any additional undertaking such as the transfer of staff must be fully funded. So why should we expect any less of the charitable and not-for-profit sector? Is it fair that those organisations which exist solely for the benefit of those they serve should be penalised for not being wealthy private enterprises?

Even an issue such as insurance can be difficult. Most of these organisations rely on volunteers, people who have chosen to freely give their time because they want to give something back to society. However, as more services are taken on with a wider range of activities, the risks increase and so too do the insurance premiums. These increased costs are not always taken into account in contracts and can represent an excessive and increasing burden for charities.

However, this is not only about levelling up the playing field to be fair; this is about the kind of healthcare organisations we want to see thrive. At a time when government resources are severely challenged and shrinking—we cannot hope to manage solely on charitable donations—bringing the not-for-profit sector more firmly into mainstream provision of services is one of the ways in which we can continue to provide much needed care, but this will work only if we ensure that these organisations can enter the market fairly and with fully costed and supported service contracts.

In supporting these amendments, the Government are accepting that this is a vital issue and they have made a commitment to provide a report with recommendations within a set timescale. This represents a significant move in the right direction and I commend the amendments.

[Lord Newby]

My Lords, I strongly support the noble Lords, Lord Patel and Lord Noon, in seeking to promote the role of the not-for-profit sector within the NHS, as indeed I do across the whole of the public sector. They have given reasons why within the NHS, particularly at this point, the not-for profit sector can play a valuable role. As the noble Lord, Lord Patel, pointed out, there are a number of serious technical problems facing the sector in successfully bidding for contracts, and he has dealt with some of them.

I remind the House that least week Royal Assent was received for the Public Services (Social Value) Bill which requires all procurers, including those in the NHS, to consider the social value of a tender as well as its financial value, in such explicit terms, for the first time. This is one of the pieces of the jigsaw which I hope will mean that the not-for-profit sector finds it easier to successfully bid for business. The Bill lays a requirement on the public sector, but the problem is whether the public sector will implement the Bill and take the provision seriously. It would be relatively easy for it not to.

Therefore, I and other noble Lords, including the noble Baroness, Lady Thornton, who have been supportive of this principle and the Bill, seek to ensure that the Government put in place specific measures to ensure that procurers take account of the Bill rather than it simply lying idle on the statute book. When we debated this issue at an earlier stage in your Lordships’ House, the Minister suggested that it might be possible to refer to this in the draft commission of procurement regulations, and I hope that he will be able to confirm today that that is the Government’s intention.

[Lord Warner]

My Lords, I commend the Government on making a move in the right direction with these amendments. At earlier stages in the Bill, I tried to raise the whole issue of barriers to entry for new providers of services. This amendment helps in some respects but the noble Lord, Lord Newby, made an extremely important point. How will we know whether the culture has changed not just in relation to not-for-profits and social enterprises but for new providers, sometimes from inside the NHS? There is a deep conservatism—with a small “c”—about how the NHS goes about allowing new players to come into the game. We need the Government to give assurances that they will keep a close eye on this. As I put forward in a previous amendment, they must get Monitor to keep a close eye on the extent to which anti-competitive behaviour by the existing NHS stops new providers from whatever source—not-for-profit, social enterprise, charities, the private sector and from within the NHS—being able, when they offer a better solution to patients’ problems, to make their pitch for an alternative way of doing business.