HC Deb 02 November 2000 vol 355 cc940-8

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Betts.]

7.1 pm

Helen Jones (Warrington, North)

I am grateful to have the opportunity to raise the regulation of care in the community schemes. I do so following problems with a charity in my constituency called Integrate Services, which I have previously raised in the House. Now that the Charity Commission has made its report on Integrate, it is time to learn the lessons of the whole sorry saga and look at ways of preventing similar occurrences elsewhere.

Despite the problems, I believe strongly in the principle of care in the community. Properly regulated schemes offer their residents a much better quality of life and much better opportunities to participate in the world around them than would otherwise be the case, but it is important that we get the framework for the schemes right. They must be properly regulated precisely because they deal with some very vulnerable people.

Care in the community schemes have not always been properly regulated. The problem goes back to the way in which schemes were set up. In the 1980s, there was much pressure to move some of the responsibilities of health and social care on to independent providers. There is no doubt that that move was partly ideologically driven. At the same time, the pressure was on to empty our long-stay hospitals, and little thought was given to the legal framework within which the schemes operated, to their governance or to the need to protect the rights of residents. At the same time, as my hon. Friend the Minister will be aware, major changes were taking place in the health service, with purchaser-provider splits, the reconfiguration of health authorities and the creation of trusts.

It was the combination of that ideological pressure and the constantly changing roles of staff that meant that the necessary checks and balances were not built into the system. The system relies largely on good will. If we are honest, good will usually works, but we have to have a system that caters for the worst cases and has at its heart the protection of vulnerable people, many of whom, like those with whom I have dealt at Integrate, are without friends or family to speak on their behalf.

As my hon. Friend knows, the real problem is that the schemes are hybrids. They are often run by charities, but many of the charities are not fundraising organisations. They rely almost entirely on public money—usually on section 64 grants. Yet charity law is designed mainly to deal with fundraising organisations. The charities that run care in the community schemes have contracts with health authorities, but health authorities cannot force them to comply with certain requirements because the charities are regulated by charity law. The position has not been thought through.

Following the problems in my constituency, I spoke to many people in the health authority, in social services and in the voluntary sector. I am grateful to them for taking the time to discuss the matter with me. I want to offer a few modest proposals to take us forward.

It is clear that many health authorities do not have a strategic policy for developing care in the community. There is no requirement on them to assess client needs, to look at how those needs will change over time or to produce projections of likely demand. The staff who have most contact with people in care in the community schemes—general practitioners and community staff—are not brought into the process at all. In some respects, the whole modernisation agenda has passed care in the community by. I suggest that we should deal with that by requiring health authorities to include in their health improvement programmes an explicit section on care in the community, so that schemes can be planned and developed in conjunction with the providers.

The relationship between the health authority and the various providers will always be difficult. Too much contact will provoke allegations of interference, but too little means poor oversight of how public money is being spent. We need a simple mechanism to deal with that. Conditions should be attached to the award of a section 64 grant that would require care in the community organisations to make a brief annual report to the health authority.

In its report on Integrate Services, the Charity Commission recommended such an annual report. That report should deal with such matters as the funds that have been obtained, how they were spent and how much surplus was retained. When a charity is involved, the report should also notify the health authority of any changes in the objects of the charity. It should list the appointment of new trustees, the reasons for their appointment and the skills that they bring to the organisation.

I realise that some of those points might be somewhat contentious, but my experience with Integrate—when a charity changed its objects so as to widen its area of operation, but was under no obligation to notify the health authority, its main funder, despite the fact that the health authority had the locus only to fund care in Warrington—leads me to believe that such provisions are essential. There are other examples relating to that charity. Friends of the chief executive were appointed as trustees. One of them had been dismissed from the health service for gross misconduct. As the Charity Commission report pointed out, the trustees had very little concept of what their duties were.

I hope that my hon. Friend the Minister will encourage health authorities to look again at their contracting process. Contracts should cover matters such as the training that staff can expect. Authorities should ensure that there are schemes to deal with providers obligations under the Public Interest Disclosure Act 1998. In the case of the charity to which I referred, it was clear that staff had not always received the training that they had the right to expect. There was no procedure for dealing with whistleblowers, who were harassed and intimidated by management.

We should encourage health authorities to go even further in their contracts. They should ensure that independent advocates have a right of access to care in the community schemes and that there is agreement on how residents' personal finances should be dealt with. In the case that I mentioned above, when the health authority decided to change the provider, independent advocates spoke to residents and uncovered some heart-rending stories. If the advocates had had access earlier, many of the problems might have been prevented.

The Government rightly want to ensure that advocates are included on hospital trusts; how much more important it is that people with mental health problems or learning difficulties, who have no friends or family to speak on their behalf, should have access to advocacy. That is a matter of basic human rights—as is ensuring that residents have access to their own benefit entitlements, instead of being dependent on cash handouts from staff. I hope that my hon. Friend the Minister will discuss with our friends in the Department of Social Security the current practice of allowing the mobility component of disability living allowance to be paid to managers of residential homes. In my view it is a pernicious practice and contrary to the rights of residents.

Health authorities should ensure that they have in their contracts an agreement on surpluses. Everyone accepts that organisations need a reasonable operating surplus, but the situation that occurred at Integrate—which, on an annual turnover of about £700,000, was building up a surplus almost equivalent to that of its successor organisation, which had national revenues of £22 million—cannot be allowed to occur again. It is a matter of ensuring that money given for the care of residents is used for that care, not to build up other assets for a charity.

Each contract should include an agreed exit strategy, so that if the health authority decides to move to another provider, it is able to contact staff to say what is going on. In my constituency, the health authority had no right to the names and addresses of staff working in Integrate Services, and they were fed a host of rumours by their management about what would happen to them.

That process of ensuring that proper matters are dealt with in the contract and in an annual report would seem to me to go a long way to improve the situation. The health authority could then annually conduct a short, sharp accountability review before it decided whether to make another grant.

Health authorities on their own cannot resolve the problem. I know that my hon. Friend the Minister is not responsible for the Charity Commission and I do not have time tonight to list what I believe to be all the faults in the Charity Commission's procedures, but it is undoubtedly true that it is too slow in conducting section 8 investigations. In the case of Integrate Services, the commission was notified in May 1999 of concerns about the charity but did not begin an investigation until September of that year, and did not report until September this year—long after the health authority had moved to another provider. That is simply not acceptable in a case that involves vulnerable people in residential homes, and it allows a crisis to build up.

In my view, the Charity Commission does not take these cases seriously enough, as instanced by the fact in this case that it was March 2000 before it appointed new trustees to the charity, as it was perfectly entitled to do, and that it never served an order on the charity requiring the production of papers. There are still allegations that the chief executive removed various papers from the charity. It is not surprising, then, that the Charity Commission could not reach a final view on many of the allegations because paperwork simply was not there.

The Charity Commission should do more. It should become much more proactive in giving advice to charities on governance and good practice, instead of waiting until problems occur. It needs to give advice on trustees' duties—such as advice on their relationships with chief officers, and on the sort of professional advice that they should be taking on certain matters. That is particularly crucial in small organisations, and if that had happened in this case, we might not have seen the problems that occurred with trustees. We might not have had the nonsense whereby an officer of the Royal College of Nursing acted as adviser to the trustees, when many of the complaints dealt with one of the senior officers of the charity, who was herself a former senior officer of the RCN, and no one saw that there was a conflict of interest. Trustees should have been given advice on that. I hope that, in future, my hon. Friend the Minister will discuss those matters with the Home Office, to see how we can proceed.

Lastly, I want to touch on the subject of the regulation of residential homes. We can talk about the duties of trustees—and they are very important—but everyone knows that much of the day-to-day care depends on senior managers who are running those homes. The Care Standards Act 2000 is a great step forward in improving residential care, but I hope that my hon. Friend will consider carefully whether inspectors should not also have the right to satisfy themselves about the arrangements for the recruitment, appraisal and monitoring of registered managers in such homes. They have the crucial day-to-day role. If inspectors have any concerns, they should also be able to call for a care audit by an outside organisation.

Our aim should be to prevent problems from arising and, when they do, we should ensure that they are dealt with a soon as possible. It is my firm view that the previous Government left us with a mish-mash of regulations on care in the community that simply do not work when problems occur. Our aim should be to ensure that vulnerable people are much better protected than they are and that we have a coherent strategy for providing and monitoring care in the community and for ensuring that such people receive the best possible services that we can provide. I hope that my hon. Friend will consider what his Department can do and, in the longer term, will examine the issues that need to be discussed with other Departments.

7.16 pm
The Minister of State, Department of Health (Mr. John Hutton)

I congratulate my hon. Friend the Member for Warrington, North (Helen Jones) on raising this subject and on her interest in ensuring that public resources in the national health service are used properly and effectively. I am also grateful to her for the opportunity to deal with some of the wider issues that she has raised and to reassure her that the Government share her concern to make sure that the highest possible standards of care are provided to people in care homes in future. In doing that, I hope that I will be able to confirm to her that we have the coherent strategy for improving services that she seeks.

I also wish to confirm that the modernisation process that we have set in train will not bypass community care. The new arrangements for improved planning between health authorities and local authorities that we have put in place, the use of the flexibilities in the Health Act 1999 on pool budgets and other arrangements and now the creation of new care trusts will lead to the progress that my hon. Friend wants.

I start by addressing the concerns that she has raised again about Integrate Services and its use of section 64 grant money received from the North Cheshire health authority. She raised her concerns with me earlier in the year and also during an earlier Adjournment debate in February to which the Minister of State, Home Office, my right hon. Friend the Member for Brent, South (Mr. Boateng), replied.

Since then, as my hon. Friend has reminded the House, the Charity Commission has completed its investigation into the organisation. In its report, published in September, the commission found no evidence of fraud on the part of the trustees of Integrate Services. However the report criticised Integrate Services for poor management and poor financial and accounting procedures.

In particular, the commission found no evidence of detailed and effective systems for recording the use of charity expenditure and senior staff time. It also found that insufficient attention was given to ensuring that management and staff had the appropriate range of skills and experience needed in running such an organisation and considered that the trustees had failed to institute sufficiently robust checks and report-back arrangements on the effective systems of management control. As my hon. Friend will be aware, the report adds that some of the misunderstandings and disagreements that arose between Integrate Services and the health authority over spending could have been avoided had a full service specification been in place, and with better communication. Again, my hon. Friend has expressed her concerns about the lack of both.

The section 64 grant to Integrate Services ceased in March this year and the organisation has now gone into liquidation. However, ensuring adequate control over such public finds remains an issue to which we attach the highest importance. We have taken action, as the result of the case to which my hon. Friend has referred, to ensure that better and clearer procedures are in place in future surrounding the use of section 64 grants. I will say more about the changes that we have made shortly.

It might help my hon. Friend if I explain how the section 64 grant scheme works, and I shall do that as briefly as I can. At a national level, the Department itself gives grants to voluntary bodies in the health and social care sector. Applications for these grants are subject to close checking, including a check of the organisation's accounts. My officials keep in regular touch with the voluntary body to monitor whether the money is being spent for the purpose that it was given. During the life of the grant the voluntary body must identify its grant expenditure in its annual accounts and the Department checks these.

Several bodies are also selected annually for value-for-money audits by our auditors. Any signs of misuse of grants, lax accounting or poor value will be followed up. Through these arrangements the Department seeks to ensure that section 64 grants are spent in the way that we intended and are properly accounted for. These arrangements are kept under review in the light of events. I am satisfied that they enable us to identify a situation such as that at Integrate Services.

At local level, health authorities also have powers to give section 64 grants to voluntary bodies in their areas, and my hon. Friend has expressed her concern about this. First and foremost, the section 64 grant scheme is an effective and important way of developing local partnerships between the national health service and independent providers. I am sure that my hon. Friend will welcome this close partnership working. She, like the Government, believe in partnership working in this area. It can lead to an improvement in services and good use of public resources.

Health authorities have a wide discretion over the terms and conditions that they apply to the use of grant by recipient bodies, though these must all be in keeping with the wider objectives of the NHS. As in their other financial dealings, they are required to exercise the standards of financial management control that is specified in their standing orders and standing financial instructions. These follow the normal conventions for public bodies. Authorities are subject to audit on that performance.

The example of Warrington Integrate Services is unusual. In our experience, it is rare for relationships between voluntary bodies and health authorities, founded on section 64 grants, to give rise to such problems. That in itself is evidence of the robustness of section 64 as a financial mechanism. None the less, the Warrington Integrate Services case has caused us to consider the general lessons to be learned from what went wrong. I pay tribute again to my hon. Friend for helping us to do that.

In particular, we have considered again the guidance that is available to health authorities in exercising their grant-aiding powers. As a result of the Warrington case, we have strengthened the guidance to help prevent, wherever possible, any repeat of this sort of problem in future. The revised guidance, which I am happy to send to my hon. Friend, emphasises the importance of there being a clear shared understanding about the purpose for which grant is, or is not, intended. It puts particular stress on monitoring to provide the necessary assurance that the original decision to award a grant remains valid, and that value for money continues to be secured. That is important at any time, but especially so when considering requests for renewal of grant.

The new guidance makes it clear that grant renewal should be managed as an active rather than a merely passive process. So, for example, we would expect authorities to be aware if a body was starting to build up a cash surplus on the basis of grants received, and if so to adjust any future grants to take account of that. At worst, if it became evident that money has not been, or is not being, used for the purposes set out in the grant conditions, it would be open to the authority to seek recovery at law. I hope that my hon. Friend is reassured by the steps that we have taken as a response to the problems that she helped to identify with Integrate Services.

I listened carefully to what my hon. Friend said about health authorities' responsibilities in working with the independent health care and social care sectors. Officials are working on guidance that will include model contracts to help social health and care communities to engage more effectively with the independent sector. It will make explicit the responsibilities of both the commissioners of services and the providers of care, ensuring the delivery of services that people need. The contracts will reflect the national minimum standards which we are currently developing and which will be applied by the new National Care Standards Commission.

In addition, we have published a concordat, which aims to develop the way in which the NHS should commission services from the independent sector. The Government see an important role for the independent sector, working in partnership with the NHS and local authorities, in the provision of services for older people. As highlighted in the NHS plan published earlier this year, the Government are developing a wide range of intermediate care services—as it were a bridge between hospital and home—to prevent avoidable admissions, to enhance rehabilitation and to enable as many people as possible to maintain or regain functional independence at home. That can be achieved in a number of ways, partly by investing more in NHS services, including giving new life to community hospitals, and partly by entering into new arrangements with the independent sector.

The whole-system approach, which is essential to the development of intermediate care, should be exactly that. There should be an inclusive approach that recognises the contribution made by all partners in the health and social care system. As part of this approach, the Government are currently exploring the opportunities for developing arrangements that would enable the best use of facilities, both in the NHS and in the independent sector.

The concordat highlights three particular areas for co-operative working—elective care, critical care and intermediate care—and it will be for local agencies to decide on the best way of providing services to meet the needs of their local population. The Independent Healthcare Association, a signatory to the concordat, has been contributing to the intermediate care debate and supports the introduction of contracts of the sort to be included in the guidance.

The measures that we are taking to reform the current regulatory arrangements for social services will also help to ensure that social care providers, whether private, voluntary or statutory, are properly regulated in terms of their financial probity, management and provision of care.

The Care Standards Act 2000 received Royal Assent in July, and I am grateful for my hon. Friend's support for the measures that we introduced in it. The Act will establish for the first time an independent National Care Standards Commission, responsible for regulating social care services. The legislation also enables the introduction for the first time of national minimum standards in care settings, and extends statutory regulation to care services which have not up to now been regulated at all.

As I hope my hon. Friend will agree, all these measures will help drive up standards of care, ensure better public information about the quality of care services and improve safeguards for those who use these vital services.

The National Care Standards Commission will ensure that all regulated care providers meet the Government's national minimum standards through a system of registration, inspection and enforcement. National standards, which are currently being developed, will apply to all providers. They will ensure that providers will be clear about the standards that they must meet to gain and maintain registration, and they will ensure that users and their carers know what they can expect as a minimum. They will cover key issues relating to staff recruitment and training.

National standards will also address issues relating to the way in which care organisations are run, including the suitability of those who manage care homes. Care providers will have to demonstrate the financial viability of the establishment and have in place appropriate financial systems to ensure continued good management.

As my hon. Friend is no doubt aware, we are also establishing the General Social Care Council, which will be in operation from next October. It will raise public confidence in social care standards and promote best practice in social care.

The council will be responsible for registration of the social care work force. One of its first tasks will be the publication of enforceable codes of conduct and practice for all social care staff. It will also draw up an enforceable code of best practice for employers, which will include good recruitment practices and rigorous checks on recruits, so that unsuitable people do not enter the work force in the first place.

Providers will have to ensure that their staff receive a copy of the General Social Care Council code of conduct, and National Care Standards Commission inspectors will check that staff know what is expected of them. Registration of individuals will be subject to the person being of good character, being physically and mentally fit for all or part of the work for which registration is sought, and satisfying the requirements of conduct and competence that the council will lay down.

My hon. Friend raised the issue of advocacy services for providers and users, particularly in the area of learning disability. However, advocacy is not just about human rights, although I recognise the strength of the argument that she made. Advocacy is also about improving practice and services, because listening to what patients and users say about the services that they have received is an important lesson for all health and local authorities.

Advocacy services can play an important role in helping people get the best out of the social care services that are available. Self-advocacy groups have worked with the Department on the new national learning disability strategy. My hon. Friend will be glad to know that that is to be published as a White Paper early next year, and we are looking at how we can develop services in this area.

With the development of the new guidance for health authorities in relation to their dealings with the independent sector, and through the new regulatory system that will operate from April 2002 onwards, I hope that my hon. Friend will be reassured that we are taking coherent measures to ensure that users are fully protected and providers of care are properly regulated.

I am grateful to my hon. Friend once again for raising these important matters with me, and I look forward to working closely with her in the future to ensure that our common objectives to improve both the quality of care and the use of public resources can be realised.

Question ut and agreed to.

Adjourned accordingly at twenty-nine minutes past Seven o'clock.