Lords Sitting of 1 March 1999

Preamble
The House met at half-past two of the clock: The LORD CHANCELLOR on the Woolsack.
Prayers —Read by the Lord Bishop of Bristol.

Colombia: Emergency Response
Viscount Montgomery of Alamein Viscount Montgomery of Alamein asked Her Majesty's Government:
What assistance has been given to Colombia following the recent earthquake in Armenia.
Baroness Amos: My Lords, the immediate life-saving phase of the emergency response was initially provided by local capacities, including the Colombian Red Cross. The Department for International Development contributes to such preparedness and response measures through its annual support to the International Federation's Disaster Relief Fund which enables national Red Cross societies to respond immediately to crises. The second phase of the emergency was to provide relief to prevent further suffering. The DfID provided support through organisations able to deliver immediate relief on the ground. The Colombian Government have expressed their appreciation of the UK's response.
Viscount Montgomery of Alamein: My Lords, that is an extremely encouraging reply, but the noble Baroness will be aware that the main export industry of the area is coffee and that the processing infrastructure for the industry has been largely destroyed, together with schools, bridges, hospitals and so on, all of which will take a very long time to repair. Can the noble Baroness say what is being considered in the longer term to restore economic activity in that area of Colombia?
Baroness Amos: My Lords, I appreciate the noble Viscount's concern about long-term economic recovery. Assessments of the overall impact of the earthquake are continuing. As the noble Viscount knows, we are always concerned to ensure that there is a co-ordinated response and a co-ordinated effort. Initial estimates indicate that 1.5 billion dollars will be needed for the rehabilitation and reconstruction of the affected areas. A number of people are still living in shelters and public services have not been entirely restored. We have a bilateral aid programme to Colombia which currently amounts to £1.4 million a year. Two of our major projects are based in the region, but they have not been adversely affected and normal activities have resumed. Our support for the reconstruction phase is likely to be through multilateral channels, and the EU and international financial institutions are awaiting the outcome of the needs assessment I have mentioned.
Baroness Hooper: My Lords, I congratulate the noble Baroness on all that she and her department
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are achieving in response to this terrible tragedy. I understand that some 25,000 homes were destroyed by the initial impact and many thousands more were badly damaged. Initial estimates indicate that the cost of rebuilding will be in excess of £300 million. Can the noble Baroness tell us whether the British Government are making any effort to encourage the private sector —our construction industry—to help by providing expertise and making secondments?
Baroness Amos: My Lords, I can say to the noble Baroness that, in addition to our immediate response, in which a number of organisations such as Oxfam and UNICEF were involved, we are looking at the longer term. However, as I said in response to the noble Viscount, we need to look carefully at the needs assessments that have been undertaken by the UN. As the noble Baroness will know from our White Paper on international development, we are committed to a partnership approach to development. We shall continue to look at the kind of resources that can be provided through the private sector. I shall write to the noble Baroness when I have further concrete information on that point.
Baroness Trumpington: My Lords, perhaps I may ask a question out of sheer ignorance. Does Colombia have a national debt? If it does, are not the financial efforts of various countries to help it in its present plight negated by the fact that it is having to repay a national debt?
Baroness Amos: My Lords, Colombia is not one of the heavily indebted poor countries and therefore does not form part of the international initiative. There is one outstanding UK/Colombia loan; the outstanding balance is £170,000. Final repayment is due in November 2005. The Colombians have consistently met the agreed repayment schedule. There is no expectation that they will not continue to do so.
Lord Avebury: My Lords, is it possible for people in the region to carry out much of the reconstruction work themselves, given minimal inputs from the international community in terms of building materials? Will the noble Baroness do everything possible to encourage the authorities in the region to use local labour? In that way, not only can people help to rebuild their own homes; they will have an income to feed their families in the meanwhile.
Baroness Amos: My Lords, one matter on which we are very clear is building around local capacity. We shall certainly encourage the NGOs and other organisations taking part in the reconstruction phase to use local capacity wherever possible.
Baroness Rawlings: My Lords, given that the Red Cross has done a superb job, will the Minister assure the House that government assistance of 1 million dollars which was promised in January is now being properly distributed? The press had reported that the distribution centres were missing.
Baroness Amos: My Lords, I can confirm that in the immediate aftermath of the earthquake we provided

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nearly £750,000 in assistance. The EC Humanitarian Office also provided assistance to the immediate relief effort mounted by the Red Cross. At that time there were some concerns about lack of co-ordination. That is why we have made it clear that, not only in this instance but in others, international co-ordination of needs assessment should be undertaken before development organisations go in. The concerns about co-ordination have now been dealt with. My understanding is that all the aid funding is being properly distributed.
Lord Morris: My Lords, the Minister spoke of the importance of co-operation in international development. Does she realise that this matter has nothing to do with international development, and everything to do with restoration of the status quo ante and with time? Speed of action is infinitely more poetic than words.
Baroness Amos: My Lords, I cannot agree with the noble Lord. It is matter of working in partnership across sectors. The international development effort has been extremely important in the short-term, and will be so in the reconstruction phase in getting the country back on its feet.

New Variant CJD: Beef Bone Controls
2.46 p.m.
Lord Stanley of Alderley Lord Stanley of Alderley asked Her Majesty's Government:
What are the odds against getting new variant CJD from eating beef on the bone, and what criteria other than risk have a bearing on consumer choice in this matter.
The Parliamentary Secretary, Ministry of Agriculture, Fisheries and Food (Lord Donoughue): My Lords, the beef bone controls are needed to protect public health and to help maintain consumer confidence in beef and beef products. There continues to be great uncertainty about the nature of new variant CJD with relation to BSE and about how susceptible people may be to infection. It is therefore not possible to estimate the current statistical risk of dying from the disease as a result of consuming beef or beef products which have been cooked on the bone.
Lord Stanley of Alderley: My Lords, I am trying to thank the noble Lord for that remarkable Answer, because my nanny told me I always had to. Unlike my nanny, who allowed me to have a free choice, do the Government intend to apply the same criteria to all foods and alcohol? Like the chicken, shall I be able to cross the road when I want to?
Lord Donoughue: My Lords, I always listen with respect to what noble Lords opposite say about nannying and the nanny state as they have far more experience than we on this side of the House have. It is not our intention to use a common standard of risk for all
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commodities because the situations are not similar; one is not comparing like with like. We attempt to assess degree of risk; however, there is always a very wide statistical range. There is enormous uncertainty about CJD. We know so little about the disease. It is fatal and there is no known treatment. The incubation period is unknown and we have no idea whether or not there is an epidemic ahead. It therefore seems appropriate for governments who have a responsibility to protect public health—and in this case to restore confidence in beef—to apply the proper precautionary principle.
Lord Stoddart of Swindon: My Lords, exactly how many people have died since 1986 from CJD/BSE? I refer to deaths that were definitely due to that cause.
Lord Donoughue: My Lords, my noble friend refers to new variant CJD. Up to about 32 people a year die from conventional CJD. The number of deaths from new variant CJD since 1995 has been 38. That is a serious matter.
Lord Hooson: My Lords, is the Minister aware that, according to the BBC television news at lunch-time today, His Royal Highness the Prince of Wales knowingly ate beef on the bone at a dinner in Wales yesterday evening? "Knowingly" means that he knew beforehand that the beef was to be cooked on the bone. If he did so, was he thereby committing an offence? If so, what do the Government intend to do about it?
Lord Donoughue: My Lords, I do not know the details of the incident the noble Lord describes and I imagine that he does not either. Enforcement is a matter for the local authority.
Lord Monson: My Lords, can the Minister say why the Government are maintaining the ban on beef on the bone while introducing legislation which will facilitate the subjection of 16 and 17 year-olds to risks which are almost certainly several hundred times greater than those incurred by eating beef on the bone?
Lord Donoughue: My Lords, I do not know what those risks are. As I explained, these are not comparisons of like with like. The Government judge each case according to the risk. I have observed that many noble Lords opposite will call for a ban on one thing—for example, genetically modified foods—while complaining about nannying with respect to another. The Government have to take a decision in each case. On this issue we were firmly advised by the former Chief Medical Officer in December 1997. The new Chief Medical Officer has looked again at the issue on the basis of the advice provided by the advisory committee, SEAC, and has recommended that the ban should stay in place. We propose to look at the matter

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again in six months. If the risk situation with regard to public health makes it possible to lift the ban, we should he as happy as anyone to see it lifted.
Lord Davies of Coity: My Lords—
Baroness Carnegy of Lour: My Lords—
The Lord Privy Seal (Baroness Jay of Paddington): My Lords, if noble Lords ask their questions shortly, there may be time for the noble Lord, Lord Davies, and the noble Baroness to ask their questions, but I believe it is the turn of this side first.
Lord Davies of Coity: My Lords, although the risk in question is all important, can the Minister confirm that because the risk was not taken into account during the period of the previous government our beef industry was so damaged in Europe and the rest of the world that this Government will not allow that to happen again?
Lord Donoughue: My Lords, my noble friend is exactly right. The situation we are in derives from the fact that inadequate measures were taken previously. Measures were taken by the previous government to ban offals and brains in the food chain and to ban gut and meat and bonemeal. A line of control measures was taken by the previous government on exactly the same principle as that on which we have taken the present measures. The difference is that the party opposite, which totally supported the previous control measures, does not support the present ones.
Baroness Trumpington: My Lords, having stood in the Minister's shoes in the previous government, perhaps I may say that he talks absolute rubbish when he says that inadequate measures were taken previously. Is there a ban on beef on the bone on the Continent? If there is not, why should we not be able to sell our beef on the bone? Are we selling our beef, whether it is on the bone or not?
Lord Donoughue: My Lords, I am sorry that the noble Baroness thinks that I was talking nonsense. The view that I expressed is shared by many who have investigated this situation, particularly the inadequate controls on infected feed and meat and bonemeal. We await with interest the result of the Phillips inquiry. There is not a ban on the Continent because there is not there the scale of BSE crisis that we have had. We have now had 173,000 cases, which is why we are suffering in this country. The Government have negotiated hard to get the ban on exports of our beef lifted and we have made considerable progress towards that.
Baroness Byford: My Lords, farmers around the country will be very disappointed by the Minister's response. Other noble Lords have suggested that there is BSE on the Continent; we are not the only country that has problems with it. We are sympathetic with regard to the uncertainty which the noble Lord expresses. However, does it not seem ridiculous that it is possible to go into one shop and buy cigarettes—
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which we know kill people—at the age of 16 while one cannot go into a shop and buy beef on the bone, from which there is a very small risk of dying and about which, as the noble Lord said, there is a great deal of uncertainty? Surely that does not make sense.
Lord Donoughue: My Lords, there is no comparison between tobacco and cigarettes, about which the risk is known and where the item one is buying is clear, and beef on the bone where often consumers would not know they were eating it. As far as the farmers are concerned, actions are being taken to restore confidence in beef to help farmers.

National Savings Pensioners Bonds
2.55 p.m.
Lord Ellenborough Lord Ellenborough asked Her Majesty's Government:
What effect will be felt by pensioners as a result of the recent falls in the rates of interest paid by National Savings pensioners bonds.
Lord McIntosh of Haringey: My Lords, pensioners bonds pay monthly income at rates fixed for five years. Existing holders will not be affected by new lower rates before their fifth anniversary. For new investors or those holding beyond the fifth anniversary, the guaranteed rate will reflect the general fall in interest rates made possible by the Government's success in bringing inflation under control. Lower inflation benefits everyone, including pensioners.
Lord Ellenborough: My Lords, I thank the Minister for that Answer. Will he draw to the attention of his right honourable friend the Chancellor the fact that, when these pensioners bonds were issued five years ago for a five-year fixed period, they were launched at a deliberately attractive rate of 7 per cent. when the base rate at the time was 5½ per cent.? Five years later, the base rate is also 5½ per cent. but the new pensioners bonds are to be issued at a derisory rate of only 4¼ per cent. Does that not show a callous indifference to pensioners and those on fixed incomes who often have to pay charges and bills at a rate considerably higher than the rate of inflation?
Lord McIntosh of Haringey: My Lords, I have taken care to examine the record of pensioners bonds' interest rates against the five-year gilt market rate over the entire period since 1994 since the introduction of pensioners bonds. Whether looked at in real terms or nominal terms, there is a close correlation between the five-year gilt market rate and pensioners bonds' rates; in other words, pensioners bonds' rates were not particularly favourable in 1994 and they are not particularly unfavourable now.
Lord Ezra: My Lords, the question asked by the noble Lord, Lord Ellenborough, raises the issue of the extent to which the Government wish to encourage savings. If they really wish to do so, the example set by

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the new interest rate on pensioners bonds is not likely to do that. Should the Government not be setting an example to the rest of the financial sector that savings are desirable?
Lord McIntosh of Haringey: My Lords, I agree with the noble Lord that we should be encouraging savings. A falling savings ratio is indeed undesirable. But pensioners bonds are only one very small part of the range of investment possibilities even from National Savings, let alone from the private sector. I do not accept the conclusion which the noble Lord draws, any more than I accept the conclusion that the noble Lord, Lord Ellenborough, drew. These are not derisory rates, they are comparable to rates in the private sector.
Viscount Bridgeman: My Lords, does the Minister not agree that in an era of falling investment returns, there is a redistribution of wealth in favour of borrowers at the expense of savers, in this case the elderly and pensioners? Does he not accept that the Government must give high priority to ensuring that there continues to be a safe, simple investment with a real rate of return, as my noble friend Lord Ellenborough indicated, for this potentially vulnerable section of society?
Lord McIntosh of Haringey: My Lords, I do not accept that pensioners fall into one category rather than another. There are pensioners and non-pensioners who are borrowers and pensioners and non-pensioners who are savers. If the noble Viscount is saying that it is the responsibility of National Savings to provide a wide range of opportunities for different kinds of people, I can assure him that that is exactly what they do.
Lord Monson: My Lords, the Minister made reference to National Savings. Does the noble Lord agree that the impending fall in the average return on Premium Bonds to 3¼ per cent. is proportionately much greater than the fall in base rates over the same period?
Lord McIntosh of Haringey: My Lords, if that is the case, I do not understand why Premium Bonds are doing so well at the moment. If the allegations about pensioners bonds are true, I do not understand why it is that of those bonds that mature in the first quarter of 1999 half are being re-invested in pensioners bonds and nearly all the rest in other National Savings products.
Lord Razzall: My Lords, does the noble Lord accept that, although it is undoubtedly the case that National Savings pensioners bonds represent a very small proportion of the difficulty, falling interest rates are a particular problem for people who are approaching retirement, in particular those who are compelled to purchase annuities with their self-employed pension funds at a time when the rate of annuity has dropped dramatically? Are the Government prepared to consider making changes to the regulations to prevent people who are approaching retirement being placed in a very difficult position?
Lord McIntosh of Haringey: My Lords, the trends that the noble Lord identified have an effect on the
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incomes of those pensioners who have investments and are about to purchase annuities. But the noble Lord must look at it in the context of the provision for all pensioners, including the poorest, who benefit from the reduction in inflation that accompanies the reduction in interest rates. I suggest to the noble Lord that that is a more significant factor.
Lord Marsh: My Lords, does the noble Lord agree that the problem in relation to annuities is that new pensioners have no choice but to buy annuities which, through nobody's fault, have dropped to a level that in the past people did not think would be likely? Does the noble Lord also agree that that is coupled with the proposed upward revision of actuarial mortality tables which will increase the problems faced by pensioners? I do not blame the Government for these matters but they are facts. Does the Minister agree that they cannot be just swept away and that there should be a review of these specific problems?
Lord McIntosh of Haringey: My Lords, I have no lack of sympathy for those who have chosen to enter pension schemes that involve the purchase of an annuity at the point of retirement and now find them less valuable. To that extent I do not disagree with the noble Lord, Lord Marsh. But these are individual choices for which the Government are not responsible. It is a bit hard for those who continue to plead for less government to expect us to intervene in such circumstances.

Olympic Games: Support for Potential Competitors
3.2 p.m.
Lord Montague of Oxford Lord Montague of Oxford: asked Her Majesty's Government:
What action they are taking to assist potential British competitors in next year's Olympic Games in Sydney.
Lord McIntosh of Haringey: My Lords, support for potential British competitors in next year's Olympic Games in Sydney is channelled mainly through the Lottery Sports Fund's World Class Performance Programme. In 1997–98 and 1998–99 grants totalling over £52 million have been awarded in the UK and England to support some 1,200 athletes in 19 Olympic and Paralympic sports. Additional assistance will be provided through the UK Sports Council's programmes for Athlete Career and Education, "Success in Sydney" and Elite Coach Education.
Lord Montague of Oxford: My Lords, I thank my noble friend for that response, which is certainly encouraging. Does he believe that there may be a link between the amount of time that schools devote to sport and our sporting performance? At the moment the average in schools is one-and-a-half hours a week. Four Olympics ago we gained 36 medals and at the last Olympic Games that figure had gone down to 17, of which only one was gold. In France during the same period the time devoted by schools to sport has doubled

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and the number of Olympic medals that they have won has more than doubled, and in the previous Olympic Games they won 15. Should we not devote more time to sport in schools?
Lord McIntosh of Haringey: My Lords, I entirely agree with my noble friend that we should give more support to younger athletes. That is the responsibility, above all, of my department. Of the £52 million to which I referred in my main Answer, in England a substantial amount is going to younger athletes. That is the relationship to which we should look. As one who tried to avoid sport throughout my school career, perhaps I am not qualified to comment on my noble friend's other suggestion.
Baroness Gardner of Parkes: My Lords, can the noble Lord inform the House about the status of the Institute of Sport? Is that body operational or still merely an idea?
Lord McIntosh of Haringey: My Lords, I am most grateful to the noble Baroness. The UK Sports Institute was launched this morning with £100 million of lottery funds. At the suggestion of top athletes throughout the UK, it will consist of a network of facilities for athletes around the country, with the hub at Sheffield, where provision will be made for such specialist facilities as high level sports medicine and other matters that can be provided only on a national basis.
The Earl of Stockton: My Lords, can the noble Lord assure the House that some of these resources will be devoted to our most successful discipline at all Olympic and Commonwealth Games; namely, shooting, and in particular pistol shooting, where competitors in this country are no longer able to practise their sport within the United Kingdom?
Lord McIntosh of Haringey: My Lords, the Government play a role in the allocation of funds for sport as a whole. It is the Sports Council that determines the allocation as between different sports. I do not seek to intervene in that matter. I am instinctively opposed to what the noble Earl said.
Lord Chesham: My Lords, the noble Lord appears to take great pleasure in announcing the funds that are channelled into sports. He made reference to £52 million and an extra £100 million. Does he agree that those funds have come from the lottery and are not government funds at all? Further, does he agree that the Government should not have any hand in or direction of those funds under the terms of the National Lottery Etc. Act?
Lord McIntosh of Haringey: My Lords, that was why I responded as I did to the noble Earl, Lord Stockton. The noble Lord is right that these are lottery funds, although there is a considerable involvement by government and local authorities. But if he is suggesting that we should not take credit for any of the sporting activities that we encourage the lottery
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to provide, he should recall that athletes themselves and sporting organisations have been giving very generous credit to the Government.

Business
Lord Carter: My Lords, at a convenient moment after 3.30 p.m. my noble friend Lady Hayman will, with the leave of the House, repeat a Statement that is being made in another place on the Royal Commission report on long-term care and the Government's response.

Health Bill [H.L.]
3.7 p.m.
The Parliamentary Under-Secretary of State, Department of Health (Baroness Hayman): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
Moved, That the House do now again resolve itself into Committee.—(Baroness Hayman.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the Chair.]
Clause 13 [Duty of quality]:
[Amendment No. 71 not moved.]
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 72:
Page 11, line 9, after ("care") insert ("and the equity of treatment").
The noble Lord said: I am at somewhat of a disadvantage until my noble friend enters the Chamber. Amendment No. 72 deals with the equity of treatment to be considered by the commission for health improvement. This is cognate with a number of our other amendments to the remainder of the Bill, in particular the amendment about equality of opportunity that the Committee considered on Thursday last in the context of primary care groups. Clearly, we believe that it is necessary for the commission for health improvement to have a duty to consider not just the quality of clinical care but the equity of treatment. We regard this as very much part of the Government's public health agenda. It was also considered last year in the report of Sir Donald Acheson, which we very much welcomed as a way of looking at the kinds of indicators of health improvement and inequalities of health that needed to be remedied.
We believe that this is a valuable and necessary amendment. We commend it to the Committee as part of a package of improvements to the Bill. It would make it a specific duty on the bodies set up by the Bill to consider equity and equality of opportunity. I beg to move.
Lord Astor of Hever: I support Amendment No. 105. We believe strongly that age should not be used as a factor in rationing. A recent survey by Age Concern discovered that 20 per cent. of coronary care units operate age-related

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admission policies and 40 per cent. attach age restrictions in the giving of clot-busting drug therapy after heart attacks. Yet the Government continue to maintain that older people are not discriminated against in the NHS. As a result, doctors are forced to make rationing decisions on behalf of the Government, sometimes against the best interests of their patients. Those decisions are often made covertly and without the patient being informed that treatment is being denied because of lack of resources. I very much hope that the Minister will accept the argument that the commission should have a legal responsibility to provide healthcare to all patients on the basis of need and not age.
Baroness Carnegy of Lour: I too wish to speak to Amendment No. 105. Age Concern Scotland is also concerned. It probably will not be necessary to discuss the matter in the context of Part II if we can cover the matter now.
What the mover of the amendment and my noble friend said about the position of old people is critical. Some of the treatments will not give as much benefit to older people as to younger people because they do not have as long to live. Because of that, older people feel threatened and are extremely worried. It is a matter of great concern. It is important that it is plain in the Bill that age is not a factor. I understand that this is the National Year for Older People which makes it a funny time to do anything other than make certain that older people are included.
I am sorry that my noble friend Lord Howe was taken by surprise by the speed at which Question Time ended. The amendment tabled in his name related to resources that are to be taken into account when these matters are considered. That is a major issue. I am sure that the Minister will understand if he were to bring the matter into his comments on this amendment. The noble Baroness is quick on her feet but so is my noble friend. However, on that occasion he lost the race. I support in particular Amendment No. 105.
3.15 p.m.
Earl Howe: I am grateful to my noble friend for giving me the opportunity to speak to the amendment which I had not otherwise intended to do. The point my noble friend makes is extremely pertinent. The issue of resources is ever with us as we consider this part of the Bill. If the Committee will allow, I shall reserve my principal remarks to a later amendment where I believe that I can introduce them with somewhat more force than on this amendment.
Baroness Gardner of Parkes: I am somewhat concerned by Amendment No. 105. The principle is right but I am not sure that it should be on the face of the Bill. There will always be moments when a choice has to be made. For example, if there is one kidney, does one give it to the young woman or young man who may be bringing up a family or to the older person? One has to look at the clinical need. However, life expectancy must always be a slight factor. It must be difficult to choose to give a transplant to someone
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whose life would be extended by only one year when another person might live 50 years due to that same transplant.
I accept and support the principle of the amendment. There should be no cause for anxiety on the part of old people. But there will be certain resources—I do not refer only to financial resources although they are important—where difficult decisions may always have to be made by clinicians. Those decisions should be left to the clinician at that time.
Baroness Thomas of Walliswood: The noble Earl, Lord Howe. was not the only person caught on the hop by the rapid commencement of these proceedings.
High-tech care for elderly patients will always be a difficult issue. But there are other aspects of care of older people where the arguments do not sound so sensible. For example, when one is over 65 one is not automatically recalled for breast screening. Yet one is at greater risk of breast cancer when one is over 65 than at any other period in one's life.
Older people may become arthritic. However, if they go to the doctor's clinic they are quite likely to be told that it is just part of growing older and will not be offered treatment. But, if people can be kept mobile they are more likely to stay at home for longer and are less likely to go into extremely expensive nursing home care. The cost of quite serious interventions such as the special drug for Alzheimer's disease which is supposed to cost £1,000 a year may be compared with putting someone in a nursing home. That now costs a minimum of £350, and is more likely to be £450, a week. One can see the advantages of some treatments which may appear expensive but become more economic when comparing one budget with another. It is hoped that the joined-up writing between the healthcare services and social services will enable such cost comparisons to be made.
Lord Desai: I enter the debate because some important issues have been raised by the noble Baroness. It is interesting to compare the expected extra life years attained by treating a younger person or an older person. But, as the noble Baroness, Lady Thomas, said, if you do not treat that older person, what will be the ultimate cost? The older person will not conveniently die; he or she will cost quite a lot more when sick. There are delicate comparisons to be made.
If we are to have an age limit—I hope that we do not—it should be clearly and transparently stated. People should not be given the run-around with excuses that they are not being treated for some other reason. If one wants to make a rule about an age limit, then people will take out insurance, or something else. They should be told. Doctors should not hide behind specialisms or technicalities and administer a Treasury rule on medical grounds. That would be bad.
Lord Winston: Members of the Committee will forgive me for disagreeing with my noble friend Lord Desai—not for the first time! But one cannot make arbitrary age limits, especially in biology. Those have to be variable goal posts. They depend on many

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different factors. It would be fundamentally wrong in medicine to say that at a stated age someone was or was not fit for treatment.
Baroness O'Cathain: Does the noble Lord, Lord Winston, suggest that doctors should offer some excuse when not using a treatment because of the age of the person? That puts doctors into an invidious situation. They are sometimes rationing and are put into the position of having to tell fibs. I infer that situation from the noble Lord, Lord Desai. That is the issue.
Lord Winston: The noble Baroness, Lady Gardner, made clear that there must be a variation according to clinical circumstances. Doctors are inevitably in the unfortunate position of having sometimes to take such decision. It is to be hoped that they do so with wisdom and with a degree of collective responsibility rather than in isolation and in an authoritarian way.
Lord Clement-Jones: The debate has been extremely interesting. The Government have not been unconscious of the needs of older people. Indeed, they commissioned the national service framework for older people and there is in the offing a charter for the long term care of the elderly. In addition, they commissioned the Royal Commission, about which we will have a Statement later today. The key issue is whether such actions are sufficient to place on clinicians the duty to be conscious of the needs of older people.
The care of older people is a crucial issue. Indeed, my honourable friend in another place considered it to be so crucial that he recently put forward a Ten-Minute Rule Bill concerning discrimination and older people and outlined some extremely telling facts. The noble Lord, Lord Astor, mentioned some of them. For instance, women over 65 are not screened for breast cancer, despite evidence that they would benefit from early detection and treatment. Although the Government are conscious of the issue, their document Our Healthier Nation contained no targets for older people. It is easy to forget their needs, but, as we emphasised earlier in Committee, older people are key consumers in the NHS.
If the duty is not statutory, what is it to be? It must be a powerful duty to keep people on their toes. I am sure that the noble Lord, Lord Winston, is correct in saying that there must be flexibility in clinical behaviour, but the one thing we cannot have is discrimination.
Since tabling Amendment No. 105, I have been stunned by the number of people who have written to me or approached me telling me that it is a real problem because they have relatives who were not cared for in a proper fashion or who were ignored. We in this House have debated the standard of nursing of older people and some cases have been shocking. The standard may depend on the way in which boards are managed, but it also depends on attitudes towards older people. On the day on which we are to debate a Statement on the long-term care of the elderly, we must be careful before dismissing a statutory duty of this kind.
Baroness Gardner of Parkes: I wish to take up the point about breast cancer screening. The hospital of
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which I was chairman researched cases of breast cancer among elderly women and found the statistics misleading. As there is no universal screening, the women who attend for screening suspect that they have cause to do so. Therefore, the percentage appears to be higher among women above the age of 65, but when compared with the population as a whole it is not higher. We must not be side-tracked on that argument.
The general practice at which I am a patient recently sent all its patients, irrespective of age, for breast cancer screening. In a new project, it decided that that should be done. I understand that some practices are introducing a screening policy in a more general way, but it has always been the case that anyone who has any cause for anxiety can ask for breast screening at any time. That was the policy of the previous government and I am sure that this Government will continue it.
Baroness Hayman: Echoing the words of the noble Lord, Lord Clement-Jones, we have had a useful short debate on these important amendments dealing with issues of race and age in terms of the quality of care and the annual report of the commission for health improvement. We have also discussed the monitoring arrangement in NHS trusts and PCTs.
The noble Baroness, Lady Gardner of Parkes, referred to breast cancer screening and she is correct in saying that we should not give the wrong impressing. Any woman over 65 is entitled to have breast screening if she wishes. There is not at present a national programme of the screening of over 65s because the national screening committee advised that resources should be concentrated, in the first instance, on young women. However, we are considering extending the age limit in pilot schemes. It will not be a matter of taking an arbitrary age limit; the effectiveness of screening will be examined just as one would examine the effectiveness of a vaccination programme for younger people. The policy will in no sense suggest that facilities should be cut off at a certain age; it will in no sense suggest that it is not worth directing attention to the elderly.
Amendment No. 72 would extend the duty of quality to cover monitoring and improving the equity of treatment as well as the quality of care. Amendment No. 75 would introduce a requirement for NHS trusts and PCTs to include in their monitoring arrangements for quality,
"monitoring by ethnic origin of individuals receiving health care".
Amendment No. 90 would require the commission's annual report to include material on its performance in respect of equal opportunities. Amendments Nos. 105 and 106 extend the principle of equal treatment, not on the basis of age, to the commission's exercise of its functions. In general, that follows our discussion earlier in Committee in the context of primary care trusts and the way in which we apply the important principles of equity of access to NHS services. That access should be fair and on the basis of clinical need. We made commitments to those ends in Our Healthier Nation Green Paper and The new NHS White Paper and through a range of other measures to improve fair access to services.

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In the foreword to A First Class Service, the Secretary of State for Health stated that fair and prompt access to modern and dependable treatment should be the goal. We have a strategy to improve quality across the board. Earlier in Committee when discussing the national institute for clinical excellence we spoke of reducing geographical variations which result from the disputes of evidence base and which can affect people whatever their age and ethnicity. However, if we are interested in equitable access to service we must tackle those issues as well as the issues of ethnicity and age. National service frameworks are a very important way of taking that forward because they aim to reduce unacceptable variations in care and treatment using the best evidence of clinical and cost effectiveness. They will be a key tool in tackling inequalities.
The purpose of the duty of quality is to ensure that all NHS provider organisations have a clear duty to put and keep in place arrangements to monitor and improve the quality of the healthcare they provide to all patients. The principles of clinical governance, which include care based on best available evidence, are applied to NHS organisations to all their patients. That in itself will have the effect of improving the equity of treatment on offer.
The explicit addition of "equity" to the definition of the duty of quality could create problems of definition. That concept is even more difficult to pin down and to assess than that of quality and could mean a range of different things; for example, equal access to treatment or fair treatment, taking account of both individual and collective need.
As regards Amendment No. 75, I am in full agreement that it is important that NHS trusts, primary care trusts and health authorities make effective use of the information they collect on the ethnic origin of the people receiving healthcare to help ensure that people from ethnic minorities are accessing the healthcare they need. However, I do not accept that an amendment to the duty of quality is the best way of taking that forward.
I hope that earlier in Committee I demonstrated the whole range of measures which we intend to take to reduce inequalities. The guidance we issued on health improvement programmes in October last year clearly sets out our expectations that we should identify and monitor targets and milestones for measurable improvements in health and healthcare and reducing inequalities. The guidance makes specific mention of mapping health inequalities and inequalities in access to services. Mapping of that kind will be informed by the type of information to which reference has already been made. The commission for health improvement will look at the quality of healthcare, and I stress again that that means the quality of healthcare for all people.
We debated earlier the needs of the elderly. I understand the reason for that; their needs have not been particularly well addressed in the past. We are trying to make progress in that area, and when my right honourable friend sent out the HAS 2000 report on dignity on the wards and care for the elderly he made clear his intention that it should be responded to by all parts of the NHS. Equally, the national service framework that we are
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setting out for service standards for older people will be an extremely important way of taking forward improvements in care for the elderly.
I referred earlier to screening, and we would certainly reject any crude, age-related cut-off point that did not allow people to have individual care and the care that they needed. But I suggest to the Committee that we run into danger when we look at age specific issues alone or issues related to ethnicity on their own. We discussed the Acheson Report, Inequalities in Health, earlier in Committee. It can be argued that poverty is one of the main inequalities, both in good health and in access to healthcare. These provisions, which deal with ethnicity and age, do not deal with poverty. They do not deal with access to services for people of different gender, and there have been some interesting issues raised, particularly in relation to coronary care, about differential access for men and women.
We run the risk of putting on the face of the Bill certain categories of people who might be disadvantaged but not others. The noble Lord, Lord Rix, is not well today and is therefore not with us, but I am sure that he would be saying that we should not neglect the needs of those with learning difficulties when we are looking at specific needs. I hope I can reassure the Committee that we recognise both the specific needs of older people—the NHS framework will be important in that respect—and the need for monitoring policies in terms of the access given to people of different ethnic origin. Again, we must go wider than that and understand what services are appropriate for specific ethnic groups. We must make sure not only that we have an equal playing field, for example, in terms of services for sickle cell disease but also that we have appropriate sickle cell services where the communities need them.
I urge the Committee to focus on our commitment to ensuring the duty of quality in the work of the commission. It must be devoted to ensuring that all patients have access to the services they need. That will encompass specific groups, without drawing a false distinction between them, and other patient groups that may be disadvantaged in the provision of healthcare.
3.30 p.m.
Baroness Thomas of Walliswood: We thank the Minister for her comprehensive response to this debate. I wish only to make the point that issues of age, poverty and race are often associated; they seem to hang together. But I do not feel the need to carry the discussion further.
Lord Clement-Jones: I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Carter: Perhaps I can interrupt with a short business statement concerning the Committee. It has been agreed between the usual channels that this evening we shall stop after Clause 46. Amendments Nos. 194 and following will be taken as first business on Thursday. The previously agreed dates for Report and Third Reading are not affected.
[Amendment No.73 not moved.]
Lord Astor of Hever Lord Astor of Hever moved Amendment No. 74:
Page 11, line 9, at end insert ("and for ensuring the publication of this information.").
The noble Lord said: In moving Amendment No. 74, I shall speak also to Amendment No. 76. The first amendment will ensure that information monitored for the duty of quality is published. The primary objective of the clause is the duty of quality imposed on PCTs and NHS trusts. It appears that health authorities are exempt from that duty, which is odd given that in many cases they are the bodies that are best placed to monitor the standards of healthcare in their area.
A requirement to publish should make comparison easier across different PCTs and NHS trusts. Good and poor practice would be more easily identified, thus driving up standards. It is also the case that the so-called abolition of the internal market will mean that the tracking of costs within the health service will become much more difficult. That is despite the Government's evident retention of the purchaser-provider split. That will result in a situation where it is difficult to determine whether a PCT or NHS trust is making the best use of the funds allocated to them. Such a situation cannot mean that patient care is effectively delivered.
It is the duty of the Government to make any information on the quality of healthcare available to patients. If mechanisms are to be put in place to monitor that information, it would be unfair for it not to be available to the public to enable people to make informed choices in relation to their healthcare. This is a matter of widespread concern to the public, as I am sure the Government will be aware from their focus groups.
Amendment No. 76 aims to ensure that the reports of health bodies on the duty of quality explicitly take into account the views of the NHS, patients and their carers. Quality in the NHS should be firmly rooted in the experiences of patients and carers. To date, the Government's proposals for quality focus almost exclusively on the needs of professionals and managers. For instance, the consultation document, A First Class Service, briefly mentions the importance of taking account of the views of patients and carers in defining quality. In debating a Bill about the structures for the new NHS it is easy to overlook the fact that the most important objective is improved quality and delivery for patients and carers. That aim should be set out on the face of the Bill. I beg to move.
Baroness Sharp of Guildford: I rise to support Amendments Nos. 74 and 76. We echo the noble Lord's words entirely. It is right, where there is a duty of quality, that there should be some tracking and that publication in this case is appropriate.
Again, it is clear that we on these Benches support the noble Lord, Lord Astor, in relation to these amendments.
Baroness Pitkeathley: I am very supportive of the aim of reflecting the views of users and carers. However, perhaps I may enter a word of caution about the fact that that can be done by publishing reports. Eliciting feedback,
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finding out exactly how the service is working from the point of view of the user and carer, and about their actual experience, will be more important than publishing a report on what has been done.
Baroness Gardner of Parkes: I feel that there can be too many reports, but we need enough for people to be able to find out what is happening and what the situation is. My memory of health service returns, which seem to be made constantly, is of an interminable quantity of paper going into the Department of Health. Such returns took an enormous number of hours to complete and no one quite knew what happened to them after that. I would make a plea for producing really useful statistics which can be used in a practical form.
Lord Winston: I fully support the sentiments with which the noble Lord, Lord Astor, moved this amendment. However, I fear that it is flawed. I am certain that this would be quite the wrong route to take. We already have a paradigm in the health service for such reports and it is deeply flawed. I am thinking of the figures given out by the Human Fertilisation and Embryology Authority which, although seemingly a comparison between units, have been shown to be statistically invalid by a publication in the British Medical Journal. And this is a very narrow area of clinical activity.
Such reports could deeply mislead the public. They would be not only potentially misleading but also very expensive for individual authorities and trusts to produce. There is every risk that unless there is extremely careful confirmation of exactly how the reports will he made, this would be an impossible exercise.
Different areas of cities, with different levels of poverty and environmental conditions, will treat different kinds of condition. All those factors could affect the outcome of clinical treatment. Under the circumstances, I do not believe that this would be a useful amendment.
Baroness Hayman: There has been universal agreement on the aim behind these amendments; namely, to ensure transparency and accountability by requiring NHS trusts and primary care trusts to publish information on the arrangements they put in place under this duty of quality. That is a concern that the Government share. However, we do not believe that it is necessary to specify this requirement on the face of the Bill.
The publication of annual reports (beginning in the year 2000) is a key part of the clinical governance arrangements we proposed in The new NHS and A First Class Service. Clinical governance will provide a framework for quality improvements locally, comprising both clear lines of responsibility and accountability and a comprehensive programme of quality improvement activities, as well as clear policies aimed at managing risk, including for the identification and remedy of poor performance.
We shall make it clear in guidance that we expect NHS organisations to publish annual reports on what they are doing to improve and assure quality through clinical governance arrangements. I do not believe that a statutory requirement for publication will be necessary to ensure that the bodies in question comply with this guidance.

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Just as I believe it is unnecessary to specify a requirement to publish information on the face of the Bill, I also believe it is unnecessary to specify here what the contents of these reports should be. Other issues aside, there is always a danger that by specifying detailed content on the face of the Bill we will be seen to be excluding other important issues we do not mention and denying ourselves the opportunity to adapt to future changes.
However, I absolutely agree that the areas highlighted by noble Lords should feature in the information which bodies publish. The guidance which we shall publish shortly on the implementation of clinical governance will set out what we expect to be the core content of organisations' clinical governance reports. That will specifically include evidence of user and carer involvement in clinical governance arrangements—the point to which the noble Lord, Lord Astor, referred—and how the organisation has taken account of national service frameworks and NICE guidelines.
I hope that noble Lords will feel, in the very clear understanding of what we shall be putting in the guidance about clinical governance and the clear intention as regards the publication of annual reports, that we will cover these areas but that we shall not exclude any others by putting these, and only these, on the face of the Bill.
Perhaps I may say a word about the issue raised by the noble Baroness, Lady Gardner of Parkes, and my noble friend Lord Winston. We are committed to publishing information on the clinical performance of NHS trusts, not just locally but nationally, as a means of driving up quality in the service. Clinical indicators will be published later this spring as part of the new performance assessment framework for the NHS.
I believe that all three of us have worked in the service and therefore we all understand that it is important, first, to collect only that information which is necessary and useful; and, secondly, that we have to be very certain that the information is valid and robust and not able to be misinterpreted in terms of the quality of care actually being delivered. That is why we are working very hard to get clinical indicators that will command confidence both in the professional and public arenas. With those assurances, I hope that the noble Lord will perhaps feel able to withdraw the amendment.
3.45 p.m.
Lord Astor of Hever: I thank the Minister for her detailed reply. This has been a useful debate. Of course, I am sorry that the noble Lord, Lord Winston, believes this to be a flawed amendment. I shall read Hansard carefully as regards both amendments. However, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment Nos.75 and 76 not moved.]
Earl Howe Earl Howe moved Amendment No. 77:
Page 11, line 14, at end insert—
("( ) In monitoring and improving the quality of health care which it provides to individuals, it shall be the duty of each NHS Trust to ensure that it takes account of the need to meet or exceed any relevant national standards.").
The noble Earl said: If there is one issue addressed in the Bill which engages the average member of the public, it is surely the quality of NHS healthcare.
We are debating the Bill at a time when standards of care and the levels of professional skill are high in the public consciousness, for a variety of reasons—not all of them happy. It is therefore absolutely appropriate that a Bill of this importance should contain provisions which acknowledge the public's justifiably high expectations of the health service.
It is slightly disappointing that only one clause is given over to the issue of monitoring standards and improving the quality of care. I am very sorry about that. Although I understand all the arguments about cluttering up the face of the Bill, the contrast between Clause 13 and the detail with which the commission for health improvement is described, for example, could not be more marked.
The so-called "quality agenda" is substantial. One of the main planks of that agenda is the implementation of clinical governance arrangements. As we know from last year's White Paper, those arrangements are multi-faceted and complex. The way in which they are implemented is of absolutely critical importance to their success. Part of that depends upon adequate resources but part also depends on the actual mechanisms by which PCTs and NHS trusts monitor care. There will have to be, for example, a continuous process of audit by which standards of care are measured, and the results of that audit will need to be published. Alongside that process of monitoring, there should be a means of collating outcome data on a national basis so that individual trusts can compare their work with that of others.
We are all well aware that NICE will produce guidelines on clinical care. However, in particular areas of clinical care, guidelines already exist, prepared by the Royal Colleges, specialist societies and other organisations. Those national standards of clinical treatment are formulated by consensus between the relevant stakeholders. Some of those guidelines are pan-European. There are good examples of national standards in relation to the treatment of hypertension and diabetes and with regard to renal services.
I feel strongly that some provision in the Bill ought to acknowledge the need of the NHS to comply with national standards, from whatever source. I shall be most interested to hear the Minister's response. I beg to move.
Baroness Sharp of Guildford: I rise to support the noble Earl, Lord Howe, in this amendment. I take on board the points made in the previous debate on Amendments Nos. 74 and 76, that there is a danger of over-monitoring and of having to produce too many reports on one thing or another. However, it is essential

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that this clause has some teeth. That is why we believe that the three amendments are worth supporting and that is why we support Amendment No. 77 in particular.
Baroness Carnegy of Lour: Perhaps I may support the amendment briefly. It seems so much better to talk about,
"the need to meet or exceed any relevant national standards",
than to refer to "equality of treatment". There is no such thing as "equality of treatment" because needs are never absolutely equal. However, treatments should measure up to the national standard. This seems an excellent amendment and the Government should certainly consider including such provisions in the Bill.
Baroness Young: In considering what seems a very important amendment, will the Minister compare these provisions with what has happened in the world of education? When league tables and other standard measurements were introduced, there was considerable criticism and it was said that they were not a good idea. In fact, the Government have now accepted them and it has been recognised that, once there is a nationally accepted standard of measurement, standards are levered up. I am in no sense criticising the National Health Service, hut it must be the intention of everybody to apply the standards of the best to all. One way of doing that is to have national measurements. That is what lies behind my noble friend's amendment and it deserves serious consideration.
Lord Walton of Detchant: When the Minister replies, will she take note of the fact that, in the medical profession in particular, there has been a tremendous move towards the regular audit of clinical procedures during the past few years, guided by the advice of the medical Royal colleges and facilities? Only two weeks ago, the General Medical Council agreed that in the future all doctors would be subject to a revalidation of their performance and of their clinical skills and competence. Although I have every sympathy with the amendment and, indeed, support its underlying objectives, will the Minister accept that there has already been a tremendous move towards fulfilling those underlying objectives?
Baroness Fookes: I warmly welcome the amendment, especially in relation to national standards. In his amendment, I hope that my noble friend is considering also the prevention of ill health. That is a very important matter to which, in the past, we have given insufficient attention. I should like to see the prevention of illness included in the national standards. It may well be, but I seek the Minister's views on that.
Baroness Hayman: Like the noble Lord, Lord Walton, I agree with Members of the Committee who have spoken about the importance of national standards with regard to our overall aim of increasing the quality of treatment given to patients and the quality of the healthcare that is provided. That was why I said, when speaking to an earlier amendment, that the guidance that
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we shall publish shortly on the implementation of clinical governance will set out the core content of clinical governance reports from all NHS bodies.
I am sure that it is inadvertent that the amendment applies only to NHS trusts. I am sure that we would all want primary care trusts equally to fall within the spirit of the provisions. As well as evidence of user and carer involvement, those reports will have to state the progress made on implementing the national service frameworks and the guidelines from the national institute for clinical excellence. Trusts must take full account of authoritative national standards and guidelines where they exist, and, in particular, what we hope will be the "gold standard" guidelines from the national institute for clinical excellence.
The noble Earl said that some national guidelines already exist and that we do not have to wait for them to be introduced. He is absolutely correct, but those many national guidelines are not necessarily the authoritative national guidelines. Sometimes, there are conflicting national guidelines on the same subject. Simply seeking to include national guidelines on the face of the Bill could cause problems. We must be certain about them. One of the main reasons for establishing the national institute for clinical excellence is that we want to have appropriate national standards.
Equally, it is important to emphasise that decisions about an individual's healthcare must continue to be taken by clinicians and the patient, based on clinical need. However much standards and guidelines are issued, doctors will still be responsible for clinical decision-making, and doctors and patients together will still make the final decisions on individual cases. Ultimately, guidance from NICE will do exactly what that word implies: it will offer advice. It will not be compulsory.
Perhaps I may remind Members of the Committee of our earlier discussion on the care of the elderly. The elderly are recognised as a patient group among whom there is very seldom one single condition about which a national guideline could be issued as the sole guidance on the care of such patients. We are trying to move to a more holistic approach and to look at the needs of the elderly overall. Indeed, the interaction of an individual's other particular health requirements might militate against the idea of strict and rigid adherence to any particular national standard.
As I have said, we accept the thrust of the amendment. We shall issue guidance to ensure that NHS trusts and primary care trusts report on their progress. Pursuit of a consistent standard of high quality treatment and care across the NHS is our aim. I hope, however, that I have been able to explain to the Committee why I do not think it necessary or appropriate to take the path set out in the amendment.
Earl Howe: This has been a useful short debate. I am grateful to the Minister for her helpful comments. Perhaps I should have tabled another amendment containing a subsection defining the phrase "national standards".

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I believe that those Members of the Committee who have spoken have been in general agreement with the thrust of the point that I was trying to make and I am grateful to the Minister for echoing that agreement. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Thomas of Walliswood Baroness Thomas of Walliswood moved Amendment No. 78:
Page 11, line 17, at end insert ("including, without prejudice to the generality of this section, general clinical care as well as medical treatment and the equity of treatment provided").
The noble Baroness said: I rise to move Amendment No. 78, which stands in the names of my noble friends Lord Clement-Jones and Lady Sharp. This brief clause is being subjected, if that is the right word, to a good many suggestions for amendment. That shows the interest which the clause has aroused and the feeling that it does not go quite as far as some of us would like.
The point of this amendment is to add to the definition of "health care" in subsection (4), by adding the provision that it should include,
"general clinical care as well as medical treatment and the equity of treatment provided".
We have just had a long discussion about equity, which I shall not repeat. The Minister might find that this is a more acceptable point at which to introduce the concept of flexible equity alongside the concept of quality, and I will leave it at that.
The mention of general clinical care is important because it includes a wide range of care, including that given by nurses and particularly the non-medical aspects of care, for example a concern for cleanliness, privacy, dignity of the patient and proper information and support for patients. Much of that is involved with nursing care, both in hospital and in the community. Such elements of care can significantly affect health outcomes, so they are important not only from the point of view of human relationships but because of their effect on the success of the treatment. This introduces the element of clinical governance, which involves the cultures, systems and processes within which and by means of which care is delivered, as well as medical treatment. The amendment supports the Minister's assertion that clinical governance is the key to the success of the new duty of quality and to the Government's overall policy agenda. Clinical governance is an umbrella term which encompasses the culture, systems and processes that are necessary to maintain and improve standards of patient care. I hope that the Minister will find this to be an acceptable amendment to this very short but, nevertheless, important clause. I beg to move.
4 p.m.
Baroness Carnegy of Lour: The issue of general clinical care was very nicely spelt out by the Royal College of Nursing, and I think that the noble Baroness who moved the amendment was speaking partly of consultations with the Royal College. I was very
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impressed by what it said about general clinical care improving the well-being of the patient in addition to medical treatment.
I have stated my views about the term "equity of treatment". I think that it is an unsuitable phrase. We all know what the noble Baroness means, and of course we all want to see fairness in the health service, but everyone's case should be considered on its merits.
Baroness McFarlane of Llandaff: I support Amendment No. 78. There is no doubt that whether or not a patient feels cared for depends very much on the quality of nursing care and not just medical care. It depends upon basic essentials, including hygiene, cleanliness, nutrition, privacy, dignity, incontinence care and the information and support given to patients. It is essential that we support the amendment, which will widen the duty of quality from medical care, including prevention, diagnosis and treatment of illness, to include these general aspects of care.
I am sure we were all very impressed by the research produced by Help the Aged on the quality of care that elderly patients have received in hospital wards, and we wish to prevent that kind of situation generally.
Baroness Hayman: I am completely in agreement that the duty of quality should not be narrowly defined as simply the quality of medical intervention.
My only concern about the amendment is whether it is necessary in view of the definitions before us. The duty, we believe, is broad enough to cover not only medical interventions but certainly nursing care. The noble Baroness is absolutely right to remind us of how crucial these matters are in ensuring dignity and privacy for patients and respect for them. The report on the care of the elderly drew that aspect to our attention and the Secretary of State has made it very clear that he expects it to be implemented in terms of NHS care in hospitals.
We also need to look at support functions, for example, pathology services, which are crucial to the quality of screening and diagnosis. It is our belief that the Bill already takes those into account. The definition of healthcare in the duty is drawn widely as,
"services for or in connection with the prevention, diagnosis or treatment of illness",
within the ambit of healthcare and the duty of quality.
The 1977 Act defines illness as including mental disorder within the meaning of the Mental Health Act 1983 and any injury or disability requiring medical or dental treatment or nursing. It is therefore already implicit in the Bill—although some noble Lords think it is by a circuitous route by reference to other legislation—that the definition of health care is not confined to medical treatment. It is broad enough to address the concerns raised by noble Lords. There is absolute agreement that we should not exclude general clinical care from the duty of quality. I quarrel with the amendment in that I believe that the Bill already includes those issues which noble Lords have addressed.
Baroness Thomas of Walliswood: I hear what the Minister says and I will read the report carefully tomorrow. I was not entirely convinced, but for the present I withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 79 and 80 not moved.]
Clause 13 agreed to.
Clause 14 [The Commission for Health Improvement]:
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 81:
Page 11, line 20, at end insert—
("( ) The bodies to whom directions are given under section 17(1) of the 1977 Act shall act upon the recommendations of the Commission for Health Improvement.
( ) The Commission for Health Improvement shall, except in exceptional circumstances, be guided by the standards set by the National Institute for Clinical Excellence as regards best practice in clinical care and treatment.").
The noble Lord said: This amendment should have been grouped with Amendment No. 77, but I shall have a second bite of the cherry on the issue of enforceability of the guidance.
The noble Baroness was very clear in what she said, which was consistent with the consultation paper A First Class Service which was issued last July. That document stated that the commission for health improvement would monitor compliance by NHS trusts and purchasers of NICE guidance. However, there was no commitment in the White Paper, nor is there in the Bill, to enforcing compliance with the guidance.
In the view of many voluntary organisations connected with sufferers of MS, Alzheimer's, haemophilia, AIDS and HIV, that leads to great danger in terms of the continuation of what has increasingly come to be known as post-code prescribing. It means that bodies within the NHS will still be able to disregard even strong guidance from NICE, and the commission for health improvement will not necessarily be able to enforce that guidance.
The original A First Class Service paper stated:
"The introduction of clinical governance will mean that variations from expected good practice, as recommended by NICE, will increasingly be challenged locally. We will expect guidance produced by NICE to be implemented consistently across the NHS. How well this happens in practice, to ensure that unacceptable variations in care for patients are not allowed to persist, will determine whether and how NICE's and the Commission for Health Improvement's powers will be strengthened in future".
That gives us an indication that, if the Government notice that post-code prescribing is still continuing, it is possible that the Bill will need to be amended at some time in the future. However, the Government already have the experience of post code prescribing. They will already know that national guidance on treatments is disregarded by NHS trusts.
In 1995, the NHS Executive issued a circular to all health authorities urging them to fund beta interferon. But a number of health authorities refused to comply with that guidance in 1996 and 1997. Indeed, in 1997 the North Derbyshire health authority lost a judicial review case because it refused to fund the drug. In addition, the health authority even rejected the assumptions which had underpinned the Government's guidance by its insistence that the drug was not clinically effective. In fact, only 16 per cent. of English health authorities are funding beta interferon for fewer
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than five MS patients. An MS Society survey found that only 3 per cent. of MS patients were being prescribed beta interferon. So there are major variations involved.
We have a large number of amendments to deal with today, so I shall not recite in detail every instance of clear post-code prescribing, but it clearly affects such drugs as aricept in connection with conditions such as Alzheimer's disease, haemophilia and AIDS/HIV. It is a continuing issue and one which needs to be addressed. The leaders of nine medical charities wrote to the Health Secretary, Mr. Dobson, in the aftermath of the publication of the White Paper. Those charities include the ones that I have mentioned and also the Motor Neurone Disease Association, the National Asthma Campaign, the National Kidney Research Foundation, the Terence Higgins Trust and the Multiple Sclerosis Society. They made it quite clear that, unless CHIMP has to enforce those NICE standards, there will continue to be major variations.
There has obviously been discussion under Amendment No. 77 of the whole system of NHS frameworks. Clearly there needs to be flexibility. It is not as if NICE in its own standard-setting will be utterly prescriptive down to the last catheter inserted; indeed, it will be broad and there will be standards across the board. We have seen some of the NHS frameworks in draft, such as the mental health NHS framework, which are perfectly acceptable. Nevertheless, they should be enforced by CHIMP and that should be part of its remit under the Bill. I beg to move.
4.15 p.m.
Earl Howe: I am very glad that the noble Lord, Lord Clement-Jones, has had a second bite of the cherry. This amendment seems to me to get to the heart of what is meant by the term "clinical governance". The latter appears to be a two-sided coin. On the one hand, it provides the key to improving the quality of patient care. I do not dissent from that and I take on board and agree with everything that the noble Lord said about post-code prescribing. However, on the other hand, it carries a potential threat to patient care. I say that because, if there is an easy answer to those who search for a definition of "clinical governance", it is the opposite of clinical freedom. That is the fundamental difficulty inherent in NICE and the commission for health improvement.
If those two bodies exercise their functions with a light touch, if they recognise the importance of a doctor's judgment and if their pronouncements are to have the status of guidance, and no more than guidance, that is one thing. But if the whole flavour of NICE and CHIMP is of a prescriptive, rule-bound approach to clinical decision-making, the consequences will not only be damaging to the way in which doctors exercise their clinical judgment but, I suggest, the system will also be unworkable. Unfortunately, the tenor of the Bill, despite the Minister's reassuring comments a few minutes ago, suggests strongly that prescriptiveness and not flexibility will characterise the implementation of clinical governance.

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However, this is not just an issue of principle; it is also an issue of practicalities. To judge the performance of a surgeon or a specialist, you need bench-marks. To create bench-marks, you must have data on outcomes. Except in a few disciplines, such as cardio thoracic surgery, information on outcomes simply does not exist. Therefore, for most specialist treatments no standards of comparison are available; nor is there any incentive at all for hospitals or consultants to collect such data because, quite simply, people do not want to publicise their mistakes.
Even if one could get over the latter difficulty, many surgeons do not know the eventual outcome of a case because the patient goes away and does not come back. There is a massive job to be done in terms of data collection before the commission can even begin to do its work. How is that to be achieved and over what timescale? Further, can the Minister tell the Committee how it will be possible to compile bench-marks for disciplines such as psychiatry or physiotherapy? These are extremely difficult issues and a proper database cannot be compiled on the cheap. It needs meaningful results, based on data that is not just obtained from centres of excellence but also from centres of mediocrity. If you try to do all this on the cheap, no one will have any confidence in the results. Indeed, you would do much better not to have begun.
At the end of the day there will always remain some conditions for which guidance from NICE is non-existent. What is a GP supposed to do? He can hardly say to a patient, "There is no protocol, so there's nothing I can do for you". The fact of the matter is that for at least one quarter of the time a GP flies by the seat of his pants: he trusts his experience and his judgment. That is what he is there for. However, none of that will feature on the radar screens of those in the commission who will treat the NICE rule book as their bible.
The Minister will doubtless tell me that I have taken the whole thing too literally and that there is no question of a rule-bound approach to clinical governance. I hope that that is true, but that does not get over the sheer difficulty of enabling CHIMP to function in the first instance. I do not know how, realistically, it will reach that point. In the final analysis the question to be asked is: will CHIMP prevent another Bristol Royal Infirmary? If the answer is no, as I fear it is, then much of the work of the commission will have been a waste of time.
Baroness Knight of Collingtree: I am a great believer in plain English. On those grounds, I have an objection to the name which has been given to the commission—namely, the commission for health improvement. Ought it not to be the commission for health treatment improvement, or the commission for healthcare improvement? Surely we are all in favour of health improvement, but I beg leave to doubt whether that will be achieved by setting up this commission. We are not very clear in what we are saying here.
When one reads the functions referred to in the amendment, it is very difficult to understand precisely what this commission will do and move it, so to speak,
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from the general to the particular. I have one brief question for the Minister. Does she envisage that what I believe to be the "great evil" of mixed wards in hospitals will be ended when this commission gets going? I ask that question because in some places they have been stopped, while in others they have not. It is impossible to overestimate the distress caused to some elderly patients—and, indeed, to others who are younger—by being placed in a bed next to one occupied by a man, if it is a lady, or in a bed next to one occupied by a lady, if it is a man. It is an issue which hospitals have not always understood. I believe that it is very wrong to impose on sick people something which could be avoided. Indeed, it ought to be recognised as a wrong way to treat people. Let us be clear in this respect. As regards this amendment and this part of the Bill, we are surely talking about healthcare and not just the rather vague concept of "health".
Lord Haskel: I did not recognise what the noble Earl referred to when he spoke about governance. I do not see governance as being laying down a rule book. It certainly lays down some basic rules, but the whole purpose of governance is to try to inform people what is best practice and try to persuade people to adopt it. It seeks to improve the mediocre, not simply tell people what to do by virtue of a rule book.
Baroness Hayman: I welcome the wide debate we have had on a specific amendment. I say to the noble Baroness who spoke about the name of the commission that if we refer back to the discussion we had earlier about the ambit of healthcare including prevention—which does, of course, concern health—we can see one of the problems of being specific and looking only at healthcare or services being provided. The whole intention of the Government's policy is not to adopt an artificial distinction between those things which encourage good health and those things which treat failing health, but to take a more holistic approach to both of them. Therefore I defend the name of the commission, but that is by the by.
In the debate on Amendment No. 81 the noble Lord, Lord Clement-Jones, suggested that we needed—if I can characterise it as the noble Earl, Lord Howe, described it—more of a rule book approach and an insistence that bodies act upon recommendations guided by the national institute for clinical excellence, whereas the noble Earl was worried about that. Clinical governance is certainly not the opposite of clinical freedom. I think I made clear earlier that one of the reasons one cannot be too prescriptive is because the individual treatment of an individual patient who may have complex needs must be individually decided as between the clinician and the patient. If he had said that the issue was the opposite of clinical licence and the licence to ignore authoritative evidence about proper treatment, we might be nearer to a working definition, but that again is by the by.
The noble Lord, Lord Clement-Jones, said—I think a little unfairly—that we had experience already of the problems and therefore we ought to move immediately to being prescriptive about enforcing the guidance set

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out by NICE, for example, and not allow it simply to be guidance. We have experience of the problems but we do not have experience of a rounded set of provisions aimed at improving quality, and of a kite-marked, gold standard, basic framework either provided by a national service framework or by national institute for clinical excellence guidelines. Then we have the duty of quality and of clinical governance and monitoring by the commission for health improvement, feeding back in turn, if necessary, to NICE and the guidelines. Therefore we do not have experience of how the whole system would work. However, I think that we have the balance right here.
Following a review or investigation what the commission recommends will be reported back to the organisation concerned, highlighting where there is need for change. The organisation itself will then be responsible for drawing up an effective action plan which will be shared with the commission, the regional office or the health authority, depending on whether it is an NHS trust or a PCT. Then the regional office or the health authority will supervise implementation of the action plan. Certainly the commission's recommendations will give added direction and impetus to that organisation in meeting its performance objectives checked annually through the NHS executive performance assessment mechanisms. Therefore I believe that the implementation of the commission's recommendations will need to be looked at in the light of wider objectives set, not just for the particular NHS body but, importantly, in the context of national priorities set for the NHS as well as wider local circumstances; for example, in working with other organisations to implement the local health improvement programme. Therefore despite the intention which lies behind these amendments—which I recognise—they may serve to be too restrictive.
We recognise the intention that organisations should move forward with recommendations made to improve the quality of services. Perhaps the noble Lord, Lord Clement-Jones, will be reassured to know that where there is unacceptable delay in making progress, the Secretary of State has a power under the Bill to give directions to the body under Section 17 of the 1977 Act, as amended by Clause 7 of this Bill, requiring it to take action to implement the commission's recommendations. Therefore there is no question of it being completely toothless. As I say, I think it important that the commission is guided not only by NICE but that it considers best practice in clinical care and treatment, and particularly national service frameworks. I do not wish to specify only NICE guidance as that which the commission should take on board and which it should ensure is being implemented. There will be a range of issues that the commission will wish to monitor and report back on and there will be a range of ways in which we ensure that institutions seek to implement improvements.
The commission will, of course, examine the take-up of NICE guidance as part of its work to assess the implementation of good practice across the NHS. However, I refer to the issue that the noble Earl raised. I say again that NICE guidance is not mandatory. It will
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provide guidance on which treatments are clinically and cost effective. It will offer doctors, nurses and other healthcare professionals advice and support in making complex decisions about individual patient care. However, final decisions on treatment will continue to be made locally in the light of individual circumstances.
The commission will have regard to a wide range of guidance in exercising its functions, including that made available through the national service frameworks and NICE. We expect the NHS to take account of this guidance in improving the clinical and cost effectiveness of its services to patients. Progress will be monitored by the commission. In those circumstances I believe it is unnecessary and indeed inappropriate to put specific provision as to NICE guidance on the face of the Bill.
Lord Walton of Detchant: I apologise to the Minister and to the Committee for joining this discussion a little late as I was momentarily distracted by some questions from another noble Lord. I assume that NICE will examine different areas of medicine and will then make recommendations upon their management. It is a matter of great concern, for example, that 3 per cent. of patients with multiple sclerosis in this country are receiving beta-interferon compared to 11 per cent. in Germany and 18 per cent. in Australia. CHIMP has been welcomed in principle by the major medical organisations in this country as being likely to make a major contribution to the improvement of health and the better management of disease. If it recommends certain measures based upon what NICE has proposed, am I right in understanding from what the noble Baroness said that should a particular body, a health authority or trust, fail to take account of that recommendation, the Secretary of State would have authority as a last resort to impose those conditions upon that body?
Baroness Hayman: Yes, the noble Lord is correct. When there is unacceptable delay in making progress on a recommendation by the commission which could well be based on the implementation of guidance, although it could be a specific local issue and not related to national guidance, the Secretary of State has a general power of direction which he could and, I believe, would use to take action to ensure that the commission's recommendations were implemented.
4.30 p.m.
Lord Clement-Jones: Before the Minister sits down, and before I respond, perhaps I may ask a question. Other health Ministers have indicated that if the experience of health authorities and NHS trusts in complying with CHIMP's recommendations in terms of the NICE standards was not a happy one, consideration would be given to tightening up on the enforceability of the NICE standards. Is that the Minister's understanding?
Baroness Hayman: I said in my earlier remarks about the circle of quality improvement that it is important that we have feedback from the commission to NICE or to the national service frameworks about the

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difficulties of implementing a particular piece of guidance—because it is conceivable that NICE might not get it absolutely right and might need to understand and learn from the experience of people trying to implement the guidance—and therefore it might be sensible that it gets feedback so that it can adjust the guidance. But, in the same way, if the guidance were being ignored across the board, that too would need to be fed back into the process. Of course, Ministers would have to consider that—that was the allusion to the reference in the White Paper. I am trying to say that we are a long way from any of that at present.
Baroness Gardner of Parkes: My concern is that NICE will be levelling down rather than levelling up. Throughout the document on NICE we are told that cost effectiveness will be considered. Surely that means that, for example, the multiple sclerosis cases will not be encouraged by that and that treatment will not be universally available. Can the Minister reassure me on that point?
Lord Walton of Detchant: Before the Minister answers that question, is she aware that the chairman of NICE has made a public statement to the effect that the recommendations of that body will be based upon what is best for the patients and what is most cost effective but will otherwise not be ruled by issues of finance and cost?
Baroness Hayman: Yes, I can perhaps reassure the noble Baroness. Cost effectiveness is not the same as something being expensive. It may he that something is expensive but very cost effective and clinically effective, and therefore ought to be introduced. We have tried to stress in the work of the national institute that it should be a mechanism not for levelling down but for ensuring that when there are new developments—when new technology and new drugs become available—which are clinically effective and cost effective, they should be available to the broadest range of patients as soon as possible. We have to recognise too that we must look into areas—and NICE may well want to look into areas—where practice is steeped in the mists of time but may not necessarily be particularly effective. We have to look at both sides. I certainly would not want to think that it was a levelling down. In some of the instances that have been referred to, we would hope that the existence of NICE ensures that more people have access to new and effective treatments more quickly.
Lord Clement-Jones: I thank the Minister for that full reply and for her replies to the supplementaries, which have clarified matters considerably. There is a slight philosophical issue here of whether one thinks that the glass if half full or half empty. I suspect the Minister thinks that the glass is half full; I think it is half empty. I have some concerns about the future.
I have seen how national service frameworks in embryonic form, in terms of the Calman Hine framework, have operated. That has operated very flexibly but, on the other hand, some authorities and trusts have not put it into effect in anything like the most effective form. It is possible to retain that kind of flexibility.
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I accept the Minister's point that we do not yet have experience of what she called a rounded set of provisions. The bodies that I have spoken to and about have had experience of a rather narrower set of circumstances where a specific circular requiring trusts to act in regard to beta interferon has not been obeyed. That is why they are full of foreboding. We all know that NICE is a terrific acronym to try and gain the good will of the medical profession—what "nicer" name could one have, so to speak—and I appreciate the requirement to have effective action plans and the fall-back powers of the Secretary of State. I cannot say at this point that we are convinced. I do not believe that the philosophy behind the amendment is over-prescriptive in the way that it operates; it is simply designed to get action and to make sure that trusts and health authorities put into operation those best practice standards that NICE will bring forward. It may be a slow process—there may not always be a best practice standard in existence—but, nevertheless, those which are in existence should be complied with. We shall consider what the noble Baroness has said and we shall probably come back to this point--perhaps in a form which looks at the Secretary of State's power to give directions—at Report stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 82 not moved.]
Clause 14 agreed to.
Lord Hunt of Kings Heath: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Business
Lord Hunt of Kings Heath: My Lords, before we move to the Statement on long-term care, I should like to take the opportunity to remind the House that the Companion indicates that discussion on a Statement should be confined to brief comments and questions for clarification. Peers who speak at length do so at the expense of other noble Lords.

Long-term Care: Royal Commission Report
4.36 p.m.
Baroness Hayman: With the permission of the House, I shall now repeat a Statement being made in another place by my right honourable friend the Secretary of State for Health. The Statement is as follows:
"At the general election in May 1997 we promised to set up a Royal Commission on the long-term care of the elderly. In December 1997 I announced to the

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House the establishment of that Royal Commission to be chaired by Professor Sir Stewart Sutherland, Principal and Vice-Chancellor of Edinburgh University.
"Since then the commission has met formally on 15 occasions, taken oral evidence from 67 individuals, conducted seven public hearings in different parts of the country, received evidence from 400 organisations and received a total of 2,040 written submissions. Between them, the commissioners met over 1,000 individuals, made 100 visits and held 140 meetings of one kind or another. They were assisted by a reference group representing the leading organisations concerned with the care of the elderly. The commission presented its report to me on Friday, 26th February, after it had been submitted to Her Majesty the Queen. It is being published today.
"I am grateful to Sir Stewart Sutherland and all the members of the commission for their diligence and the swift delivery of their report. All 12 commissioners signed the report. Two commissioners have submitted a note of dissent on three particular aspects—and even they were not entirely unanimous.
"The task of the commission was to look into how best to provide sustainable long-term funding for good quality care of the elderly and how the costs should be shared between taxpayers and the individual. Its report rightly makes clear that this is something on which 'there is no obvious answer' and calls for an 'informed debate' on what it has recommended.
"I support that call. The Government's response must await the outcome of that debate which I hope and expect will commence with today's publication of the Royal Commission report. I hope that it will be useful to the House for me to highlight a number of the Royal Commission's major conclusions and recommendations. First, it concludes that there is not a demographic time bomb with which our economy and society cannot cope. Secondly, it concludes that the possible need for long-term care is a risk that cannot be met adequately from individual income or savings so some pooling of risk is necessary. Thirdly, it concludes that private insurance will not deliver the necessary cover at an acceptable cost. Fourthly, it concludes that the costs will have to be met by contributions from the taxpayer and individuals. Fifthly, it concludes that the costs of long-term care can and should be separated into living costs, housing costs and personal care costs. Sixthly, it recommends that people receiving care should be expected to contribute to their living costs and to their housing costs but the costs of their personal care should be met by the taxpayer. The note of dissent rejects this separation and the proposal that individuals should not contribute to the cost of the care element. It gives greater priority to the quality of care.
"The commission estimates that to adopt its proposals would cost the taxpayer between £800 million a year and £1,200 million a year at 1995 prices. It estimates additional costs to the taxpayer of lesser options such as a short-term disregard of house
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value at £90 million a year, changing the limits of the present means test at between £150 million and £200 million a year and making nursing care in nursing homes free at £220 million a year.
"As the report states, 'This is a complex issue and there are no easy solutions'. We have to get this right. In considering the commission's proposals we will all need to bear in mind, firstly, the taxpayers' money used to relieve the costs to individuals cannot also be used to improve the quality of care or extend it, though this might be a higher priority with some older people. Secondly, these proposals, like all aspects of taxation and benefits, would shift money from one income group to another—in this case to some better-off people from some who were worse off.
"The report recommends that the best way to help carers is to improve the services provided for the people they care for. The note of dissent argues that priority should be given instead to respite care.
"The report emphasises the need to improve cultural awareness in services offered to ethnic minority elders. It also recommends that the Government should consider applying to the personal care needs of younger disabled people the same principles they recommend for care of the elderly.
"While the commission has been sitting the Government have been getting on with making improvements to the treatment and care available to elderly people. So we have already made a start on a number of aspects covered by the report. These include: extending direct payments to over 65s; breaking down barriers between the health service and social services; improving local standards through the long-term care charter—a clear manifesto commitment; changing the law to allow local NHS and local councils to pool budgets; £750 million over three years for initiatives to promote rehabilitation and prevention; providing for more consistent standards of care in health and social services; preparing for independent inspection of nursing homes, old people's homes and social care through regional care commissions; starting work on a national service framework for older people to lay down how the NHS and local councils should provide them with high-quality services in every part of the country; encouraging care providers to promote independence rather than dependency; and launching a new strategy for carers with £140 million over three years.
"We also accept—as does the Royal Commission—that there is a strong case in principle for phasing out the payment of residential allowances and transferring these resources via a special grant to local authorities. But we will need carefully to work through the implications of this change on both the benefit system and on the independent care sector before we take any final decisions.
"The Royal Commission's major recommendation that a national care commission should be established to monitor trends, set standards and represent consumers will need to be considered in the light of these changes already in place or in the pipeline.

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"The Government have also been taking other action to help elderly people. These measures include: restoring free eye tests for pensioners; commissioning a report from the Health Advisory Service on the treatment of elderly people in acute hospitals; instructing all hospitals to take immediate action to improve the supply of bed linen, food and drink to elderly people; making a start on providing greater financial security by reform of the pension system; improving the Government's overall approach through the Better Government for Older People initiative and establishing an inter-ministerial group to take this forward across government.
"Along with the rest of the country the Government will study the report of the Royal Commission with great care. In the course of our consideration we will apply the principles set out in our welfare reform Green Paper, in particular expecting people to insure against foreseeable risks and make provision for their retirement; making sure that those most in need can enjoy a dignified and fulfilling life; providing public services of high quality to the whole community; and making sure the system is flexible, efficient and easy to use.
"At the general election we committed ourselves to setting up this Royal Commission. That was because we recognised that, although only one in five old people need long-term personal care, as people approach old age many become anxious about how well they will he looked after, who will look after them, how much it will cost and who will pay.
"I hope that the Royal Commission's report and the debate it will stimulate will help us find a way of ensuring that people have access to high-quality long-term care that is fair to both individuals and the taxpayer. I hope that it will be founded on a consensus that will stand the test of time—a dependable contract across the generations. That is of great importance because what elderly people seek, second only to good health, is financial certainty and security. And that is what this Government are determined to deliver".
My Lords, that concludes the Statement.
4.45 p.m.
Earl Howe: My Lords, the House will be more than usually grateful to the Minister for repeating this important Statement. I am sure that it will be welcomed on all sides of the House, not least because it marks the fulfilment of the remit given to the Royal Commission in December 1997 which it was asked to complete within 12 months. The commission has not quite succeeded in keeping to that timescale but has very nearly done so, following a very substantial workload. For that, members of the commission are to be thanked and congratulated.
When the Royal Commission was announced, we on these Benches emphasised the need for the Government to pursue their agenda for long-term care with decisiveness and speed. If I have one message for the Government today, it is that they should try to do just
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that. The Statement is perfectly right. These are highly complex issues. However, the commission has taken extensive evidence; it has reported; and now Ministers must decide.
The central problem in relation to the provision of long-term care, is, as the Minister indicated, its unfairness. Despite substantial increases in the means test threshold introduced by the previous government, many old people have had to sell their homes in order to pay for residential care. Such people often feel cheated. Having paid tax for many years when rates were high, they are now in receipt of sometimes poor levels of care, having sold their assets to pay for it. Others who have not saved for their retirement at all have all their costs paid for them.
The unfairness goes wider than that. The availability of local authority-funded care varies widely depending on where people live. Nor is there any consistency in the cost of such care. People are unable properly to plan ahead in the face of such uncertainty.
The other perceived unfairness of the present system relates to nursing care. Whereas nursing care is provided free in hospitals, at home and in residential homes, it is means tested in nursing homes. Particularly since the National Health Service and Community Care Act 1990, indeed over the past 10 years, the private and voluntary nursing home sector has expanded considerably. The result is that fewer old people receive free NHS nursing care than was previously the case.
The Royal Commission has come forward with the recommendation that nursing care should be funded by the NHS wherever it is provided. As the Statement makes clear, that carries with it a considerable price tag—although I am not at all clear why the figures have been presented at 1995 prices. Perhaps the Minister will comment on that.
Even if that proposal is accepted by the Government, the cost of nursing is not the only issue. The so-called hotel costs will still require a very large outlay on the part of older people in care. It is perfectly possible to imagine that pensioners will have to sell their homes, as they do now.
In 1996 the previous government published a White Paper, A New Partnership for Care in Old Age. Had it been brought in, the partnership scheme would have encouraged old age pensioners to take out insurance enabling them to protect £1.50 of assets for every £1 of insurance. That would have meant that a pensioner paying £20,000 in insurance would have had £20,000 of care paid for by the insurance company and they would then have had £46,000 of assets protected instead of £16,000. People not yet in long-term care but who might foresee a need to be in later life were also planned for. Under the scheme they would be encouraged to take out indemnity insurance to protect their assets and pay for the cost of their care. Those plans were seen by the then

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government as an addition to the existing community care arrangements and would not have affected people unable to pay for insurance.
There were criticisms of those proposals. One was that insurance schemes would not help everyone but only those who could afford the payments. Large numbers of pensioners on low incomes are not eligible for means-tested benefits and the scheme would not have included them. There was also a fear that when insurance money ran out pensioners would be ineligible for local authority assistance.
While that scheme was not a complete or perfect solution, it was a good start, and draft legislation was ready to be brought forward to Parliament. Will the Government reconsider the merits of that scheme, which appears in no way to cut across the Royal Commission's recommendations? Indeed, it seems absolutely consistent with what the commission says about the need to pool risk.
Will the Minister confirm that one of the key words contained in the Royal Commission's remit, apart from "fairness of outcome", which we all want to see, was that any system of funding the long-term care of the elderly had to be "sustainable"? Will she also say what the implications of the report are for younger people with long-term care needs? I think particularly of young adults with severe learning difficulties who are looked after at home, often by elderly parents. It would be hard not to describe the kind of care provided for those individuals as nursing care. The commitment and stamina required of those elderly people are often very considerable, with little in the way of respite relief. What does the report do for those people?
Can the Minister say how the High Court ruling last December in the case of North and East Devon Health Authority ex parte Coughlan affects the Government's policy on the funding of nursing costs?
I believe that the Statement leaves matters unsatisfactorily in the air. I agree that we should have consensus, if we possibly can. But if the Government are not minded to accept the Royal Commission's recommendations, when will they put forward their own proposals? In opposition the Labour Party promised that it would act swiftly and radically to address the problem. What is the time-scale for some definite proposals? The Government need to address the issue in the round, not only as it affects today's pensioners or those soon to retire but also as it affects future generations of pensioners. How are the middle-aged now meant to plan for their retirement in the absence of a clear policy?
4.53 p.m.
Lord Clement-Jones: My Lords, I join the noble Earl in thanking the Minister for giving us an interlude in the Committee stage of the Bill, which has presented some problems in reading the paper—or not reading it. We very much welcome this eagerly awaited report from Sir Stewart Sutherland. Although noble Lords present have not been able to study all the recommendations, there is the chance to consider some of the points arising from the report and to ask the Minister about a number of areas relating to it.
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Long-term care is an issue for the elderly and for society as a whole. We on these Benches welcome statements about hoping that action will be founded on consensus. But that very much depends on the Government's approach and, with respect, on whether we can agree on proposals in this area.
The costs involved are very large indeed. In 1997 the cost of long-term care for the elderly and disabled totalled some £12½ billion. That figure excludes the notional cost of carers, which many people expect to rise as carers might prefer to pay for care themselves or leave it to the state or some other agency. That is in itself a worrying matter. In this context the conclusion of the Royal Commission that there is no time bomb with regard to costs seems somewhat strange. It appears that the costs of care will rise from some £12 billion to something over £35 billion in 2040. That seems to these Benches a significant rise in expenditure.
We welcome the proposals from the Royal Commission majority group about the separation of nursing costs from accommodation and other non-health costs. We believe that it is important to make no distinction between nursing homes and residential homes, hospitals and nursing care at home. Following on the noble Earl's question on the Coughlan case in December 1998, does that case not decide this matter, anyway? Is it not now settled law that those costs should be borne by the state? It is important that the Government give an indication about that since not only is that proposal the underlying basis of the majority report of the Royal Commission but the Government's view on the matter is long delayed. We have not had a government response on the Coughlan case; it is important that we have one in order to make sense of the Royal Commission's report.
Do the Government agree with the estimate of costs put forward by the Royal Commission of something like £200 million for the separation of costs and the bearing of nursing costs by the state? Do they recognise that there are savings to be made against that figure? Older people would not have to go to acute hospitals and occupy beds, for instance, in the case of major flu epidemics such as the one we have just experienced. In many respects that £200 million may be an over-inflated figure.
Do the Government accept that we need a comprehensive NHS community nursing service to cater for all the different institutions if the Royal Commission's proposals are taken forward? Will the Minister urge the Chancellor to take action in next week's Budget? The Government have had the report since mid-January. We know that the Prime Minister met the chairman of the Royal Commission at that time. Surely the question of how the disregard on assets is to be treated, for example, is already part of the Government's thinking. An opportunity is available next week to show the Government's earnest on this whole matter.
A major theme of the report is the need to integrate health and social services. In the light of the report, does the department believe that the Bill should go further? We have had debates in Committee on the integration

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of health and social care. Do the Government believe that the Royal Commission is urging them to go further in that respect? How will the national care commission interface with CHIMP? The Government have yet to consider whether they wish to adopt the idea of a national care commission, but some thoughts from the Minister on that subject would be helpful.
There is then a question of timescale. It is obviously of great importance that the Royal Commission's report should not fester on a shelf. It must be dealt with quickly. A ministerial group on old people exists, the setting up of which we greatly welcomed. Will that group of high-powered Ministers consider the report at the earliest moment? What is the time-scale within which the Government believe that it will be dealt with?
I was interested to note the discussion initiated by the previous government, to which the noble Earl referred on the question of private insurance. It is difficult to comment on that area. We know that the Royal Commission took a great deal of evidence—particularly abroad—on the question. But in the overall summary of the proposals this appears to have been dismissed with too much ease when it is considered that people aged about 60 have one chance in three of having to pay long-term care costs of the order of £30,000 and that a private insurance premium of about £10.000 is one way in which people with reasonable incomes can cope with such an eventuality. It means that potentially one removes a swathe of people from the problem of catering for accommodation costs, if it is assumed that one takes away nursing costs. There appear to be some interesting ideas that have not necessarily been fully addressed in the summary of the report of the Royal Commission. Clearly, we wait for further clarification.
Will the recommendations on carers in the report be built into the Government's strategy on carers? That is an important area.
Finally, it is important that in this debate we do not focus simply on costs. It is very easy to treat this as some kind of supplication to the Chancellor and the Secretary of State for Social Security. One must focus on how best throughout older people can remain healthy, independent and active for as long as possible. This is a valuable report which must be taken forward in that spirit.
5.1 p.m.
Baroness Hayman: My Lords, I am grateful to both noble Lords for their welcome of the Statement. I feel some sympathy for them. When I was preparing yesterday it crossed my mind that it would be even more difficult for them today. In this context I should point out when the report was available. The noble Lord, Lord Clement-Jones, suggested that we had had it since mid-January. I must make clear that the Royal Commission presented its report to the Secretary of State on 26th February having submitted it to Her Majesty the Queen, as it had to be. We are publishing it today and trying to get it into the open for public discussion as soon as possible.
1400
We very much accept the point made by both noble Lords that it is important to make progress in this area, although—as I believe emerged from their observations—just because there is a Royal Commission recommendation does not mean that there will be unanimity of response to it. Major issues face society to which there are not simple and indisputable answers. It is important that there is a general debate about them in order to provide a way forward that commands support throughout the community. The analysis carried out by the Royal Commission has been enormously helpful in that regard and is the foundation on which that debate should take place to enable some of the longer-term decisions to be taken. I do not believe that in terms of the basic issues, we can short-circuit that process, although we are already addressing some matters that concerned the Royal Commission. We shall be doing that at the appropriate time. For example, we have said that we want to establish a more consistent and fairer way of charging for non-residential social services. This matter was touched upon by the noble Earl. Now that we have received the report of the Royal Commission we can look at how to take forward the work on the review of charges for domiciliary and day care services. We also need to take forward the work with the voluntary sector and other interested parties to ensure that users of services and carers are involved in that process and their views are taken into account. The Statement outlines a number of other areas such as joint working and pooled budgets. These are matters to which we shall return later today in the context of the Health Bill that is now before your Lordships' House.
I was asked a specific question about the implications for younger disabled people. I believe that the Royal Commission makes clear that because it has reported in a fairly limited timescale it has been unable to go into the needs of younger disabled people with as much care and detail as it has for care of the elderly. But its general view is that the recommendations can apply equally to that group. We shall need to look very carefully at the implications of that recommendation for younger people with long-term care needs. As a government we have given high priority to the needs of disabled people in the form of the Disability Rights Task Force, the Disability Rights Commission Bill, the social services White Paper, the welfare reform agenda and the new deal for disabled people. Now we must look at the recommendations of the Royal Commission in the light of the existing work and the principles that have been established.
The noble Earl asked why the figures were based on 1995 prices. The answer is that it was the latest year for which the Royal Commission could find comparable figures for all the diverse sectors that it considered, including health, the DSS and social services. Therefore, in the interests of achieving a level playing field for purposes of comparison the Royal Commission had to go back to 1995.
The noble Lord, Lord Clement-Jones, asked whether the Government accepted the commission's estimate for nursing costs in nursing homes. Obviously, we need to check the analysis. There are many analyses of the different component costs of different

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recommendations, but the estimate is certainly not outwith what we expect to be the kind of costs in nursing homes that are considerable and where there is an anomaly to which reference has been made. This is one of the areas in which the Royal Commission looks at both short and medium-term measures that can be taken within the ambit of its broader recommendations.
Referring to the effects of ex parte Coughlan, in response to the noble Lord, Lord Clement-Jones, it is not a matter of knowing what the law is simply by looking at the decision in that case. There was a recent decision in R. v. North and East Devon Health Authority that nursing care should be provided by the NHS. The health authority then made an application for leave to appeal against the High Court's decision. In the light of the impact on policy of the view of the High Court about the funding of nursing care and given the importance of clarifying the judgment and making clear the current legal position, we decided to support the health authority's application for leave to appeal. Leave to appeal and for the Department of Health to intervene was granted on 4th February 1999. We shall need to consider guidance to health and local authorities once the result of that appeal is known. We do not have a definitive understanding of the legal position at the moment.
In response to the noble Earl, Lord Howe, the Royal Commission concluded that private insurance would not deliver the necessary cover at an acceptable cost. It looked at the partnership proposals of the previous government, to which the noble Earl referred, and its response was that it was rather complex and difficult to see where the benefits lay and to whom. Therefore, it did not give a great deal of support to that particular way forward.
5.9 p.m.
Lord Laming: My Lords, we are grateful to the Minister for repeating the Statement. Does the Minister agree that the analysis undertaken by the commission encourages all of us to adopt a much more positive approach to ageing? We should celebrate the fact that more people are living to an advanced age and have a certain quality of life as they approach their older years. Does the Minister agree it is rather ominous that the Statement makes reference to such matters as the complexity of the issue and suggests that there are no easy solutions? Further, a good deal of the Statement repeats what is in the Government's programme, with which I entirely agree. Is it ominous that the commission has, despite its hard and speedy work, contributed to the debate rather than set out the way forward on how those who become dependent should have their care funded in the future? Does the Minister agree that questions about the financing of long-term care for a large number of people, as raised by the noble Earl, remain?
Baroness Hayman: My Lords, the noble Lord is correct in his analysis of that Royal Commission report is a clear statement that we should not regard the fact that people are living longer as an enormous problem but should ensure that they do so in security and in good health. It is a matter in which each of us has a personal
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interest. In that context, the idea of a demographic time bomb is a rather gloomy metaphor. We are almost getting back to the half empty or half full glass which appealed to the noble Lord, Lord Clement-Jones.
I am sorry that there was a degree of disappointment inherent in the comment of the noble Lord, Lord Laming, that it is a complex area and that there are no simple solutions. The Government do not distance themselves from the analysis that it is a complex area, and they do not suggest that there are simple solutions. That is very much inherent in what was said by the Royal Commission. It is evidenced by the fact that there was a note of dissent; not all the commissioners agreed. That does not mean that we cannot make progress. It does not mean that we cannot, or would not wish to, go forward with greater clarity about the government position. But it suggests that we would be well advised to have a wider public debate on which to bring forward a consensus as to the best way forward.
Baroness Pitkeathley: My Lords, I wish to thank the Royal Commission, in particular for the open way in which it was able to engage with those organisations which represent elderly people and their carers. That was extremely valuable.
The Statement says that only one in five people will need any form of residential care. Does the Minister agree that nonetheless it is an issue that concerns every family in this country? Therefore the importance of the debate cannot be over-emphasised. Nor should we be too gloomy about the opportunity to reach consensus because it is a concern of so many people.
Does the Minister also agree with me that although some of the issues are complex we must bear in mind the need for openness and clarity in transmitting the decisions which the Government finally make? The real issue which has caused distress over the years is confusion about what is and what is not available. Will the Government consider phasing in the proposals if they are not able to accept them all in one fell swoop?
Baroness Hayman: My Lords, the Government would have to consider carefully the acceptability or otherwise of individual conclusions and the timing of implementation. The commission looks at possibilities of phasing in, recognising the very substantial costs involved.
I accept my noble friend's analysis. Although the figure is only one in five people, no-one knows which one out of the five it will be. It could be any of us or any family. That means that it is a matter of concern to everyone. That is why the Royal Commission recognised it as a community responsibility and in its analysis considered the need to share that risk more widely among the community as a whole.
I agree with my noble friend that more transparency is needed. Uncertainty has added to people's difficulty. There have been obvious inequities between people in different circumstances which have little to do with their

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underlying need for assistance. In any response we would aim to provide a more equitable system to those who need it.
Baroness O'Cathain: My Lords, first, what is the Government's reaction to the proposal by the Royal Commission to set up a national care commission? If they agree to it, will it replace the Government's own proposal to set up regional care commissions? Will all the commissions proposed help those who are currently under great stress attempting to fund the high costs of residential care?
Secondly, I wish to bring to the attention of the Minister the fact that it is not necessarily the people in long-term care who have to fund it, but their relatives. Is there any chance that tax relief can be given to those relatives bearing in mind that other European Union countries have that relief? Good long-term care can cost something like £45,000 upwards in pre-tax income. The noble Lord, Lord Clement-Jones, asked the Minister to approach the Chancellor to take action in next week's Budget. Realistically that is not possible. But if the noble Baroness were to do so, perhaps she would consider adding my humble suggestion to the noble Lord's good suggestion.
Thirdly, and finally, will the Government allocate time for a debate on the report of the Royal Commission in this House? That could be part of a wide consultation process.
Baroness Hayman: My Lords, as the noble Baroness knows, allocation of time is a matter for the usual channels in your Lordships' House. But I am sure they will pay attention to her comments. As regards suggestions made on taxation policy, I am sure that my right honourable friend the Chancellor of the Exchequer reads Lords Hansard daily. I shall ensure that the suggestions made are drawn to his attention.
The noble Baroness will understand from what I said that we do not have an instant response to the commission's proposal for a national care commission. As suggested, it would be wide ranging, dealing with complaints, trends and projections, advising on standards of care and training and professional issues. For example, it would require primary legislation. We need to look at it, as I think she suggested, against our commitment to the new national training organisation, the general social care council and the regional care commissions. We would have to assess it against those proposals which were already in the pipeline.
Baroness Turner of Camden: My Lords, I, too, thank my noble friend for presenting the Statement. It is interesting, and I hope that we shall have an opportunity for further debate. Is my noble friend aware—I am sure she is—that the provision of long-term residential care in the past few years has become a highly profitable business? In the London area it will often cost between £400 and £500 a week to provide long-term residential care. If the taxpayer is to pick up a portion of those costs, steps will have to be taken to ensure that we are receiving value for money for that expenditure. Is there
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to be any arrangement, and which organisation would be responsible, for monitoring such care to ensure that value is obtained for the money expended?
Baroness Hayman: My Lords, my noble friend has a long-standing interest in these areas. She is right to point out that we are talking about large sums of money. It is important that we consider value for money and the effectiveness of care provided. Various suggestions are made about that. The commissions for care standards will be studying the issue across the board. The Royal Commission suggests detailed provision, in particular in terms of the national care commission, for considering those areas. Perhaps I may write to my noble friend on the details.
Baroness of Thomas of Walliswood: My Lords, as one whose family has had to cope with the matter for a number of years, I agree on the importance of the issue. I recognise, as do many, the importance of the issue for every family in the country.
I was concerned by an opinion which the Minister in the Statement attributed to the commission's report. It suggested that increased expenditure on nursing care for the elderly would not necessarily bring with it a better quality of care. I contest that opinion. One of the difficulties which is faced by relatives whose elderly parent is in care is not knowing who to turn to for correct advice. If a qualified nurse monitored, for example, the level of medicaments prescribed to a patient over a period of time, which is not easy for untrained staff, the results might be not only a better quality of prescription but also a lowering of cost. If the National Health Service had a requirement to consider the need for long-term expenditure on healthcare for the elderly it might be better motivated to intervene at an earlier stage. How does the noble Baroness respond to those comments?
Baroness Hayman: My Lords, I agree with the main points which the noble Baroness makes. Issues such as prescribing policies within nursing homes are of great concern. Some of the commission's suggestions—for example, a national care commission looking at just such issues—would improve quality and might cut costs.
The noble Baroness may have taken from the Statement a comment which was made not in relation to supporting nursing costs and improving nursing quality, but the commission's opinion that if taxpayers' money is used to alleviate the present means test and to relieve the cost to individuals, that money cannot be used to improve the quality of care across the board. That may be an issue of higher priority to elderly people or to the community as a whole. That contrary distinction was being made and not the issue of whether money should be put into improving nursing care.
Lord Peston: My Lords, it is difficult for us to comment on the details of what may be an important Royal Commission report because we do not have copies. However, there are comments in the Statement which are puzzling, to put it mildly. For instance,

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I cannot remotely work out how the figure of one in five can be calculated. Essentially, if people live long enough it is 100 per cent. I cannot see how it can be anything other than that if people live long enough.
I have a problem in that when we were in opposition our attitude seemed to be slightly different. It was that for the first time a whole generation who had won the Second World War for us experienced full employment and overwhelmingly acquired some assets—notably, their houses—but were suddenly told by the government of noble Lords opposite that because they lived so long, partly due to the NHS, they must use those assets to finance their long-term care. When I was looking at the various nails going into the coffin of the previous government I thought that that would be the one which would ensure that they went and would not be re-elected for some time.
I am concerned because I had hoped to hear from my noble friend—I do not wish to rush her because I know that these things take time—that that is not a path we wish to go down with that generation as opposed to younger people who can prepare for the future on a different basis. I did not hear anything in the Statement to indicate that that is so. I must ask my noble friend to accept that some of us on this side of the House find that disturbing. The costs of care are enormous. I had to meet them precisely on the ground that I did not want elderly parents to believe that their few assets would have to be sold. Other people have had the same experience.
I hope that our new Government will not take the course that appears to be indicated—I know that my noble friend would never be a party to that—and will not follow the policies of the previous government. I hope that they will say to the elderly who are approaching the need for care that they will not have to use the assets, which they have acquired because they have been prudent, in order to finance their care.
Baroness Hayman: My Lords, I listen carefully to what my noble friend says and take his strictures seriously. The commitment in the manifesto to set up the Royal Commission was clear. That has been fulfilled. The task of the Royal Commission was to look at how best to provide sustainable long-term funding for good quality care of the elderly and how those costs should be shared between taxpayers and individuals. That was the remit of the Royal Commission and it has reported with great care. I have not made an instant response to it for the reasons set out in the Statement. I hope that my noble friend will understand that we are not ruling anything in or out until we have carefully considered the report in detail.
My noble friend is being overly gloomy in believing that everyone will need long-term personal care. I suggest that there might be some members of your Lordships' House who can prove that that is not true. It is only one person in five who is in need of long-term personal care and at whom we are looking in the report.
Lord Swinfen: My Lords, I note that a group within the commission dissented and wished to put forward the idea that taxpayers should pay for respite care in priority
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to nursing care. I hope that both will be paid for in the long run because respite care will prevent the ultimate nursing of the carers after the breakdown in their health. Respite care is not an alternative; it produces a long-term saving and should be provided at the same time as proper nursing care.
Will the Minister tell the House whether nursing care includes that in private residential homes as well as that supplied in one way or another by the state? Is she sure that we will produce sufficient nurses in this country? I understand that under the new scheme of training nurses, Nursing 2000, students receive salaries and that many undertake the course in order to receive the salary and having qualified do not enter the nursing profession. Would it not be better to return to the old system of training on the job in hospitals where they gain experience as well as knowledge?
Baroness Hayman: My Lords, the noble Lord tempts me to initiate a debate on nursing education which could take some time. The drop-out rate from nursing courses before the introduction of the new system was also high; perhaps even higher. The issue is not about producing enough nurses—we are increasing the number of training places and conversion courses for nurses who were previously state enrolled—but about how we retain nurses and encourage a return to the profession by many who leave after some years in service. That is a wider issue about nurse education. I can take common cause with the noble Lord. We have broken some of the links between the NHS and nurse education which were previously beneficial, but we are looking at ways to recreate them.
I certainly agree with the noble Lord that there is a vital role for respite care. That was recognised in the Statement made on a national strategy for carers. It is not an either/or situation. We need to support carers in their caring role. However, as I understand it, there were dissenting voices which said that it was counter-productive to try to provide alternatives to informal care by relatives and to follow that route. It was accepted that that caring was done but it was felt better to provide more respite care. The view of the commission is that we need support across the board for carers.

Health Bill [H.L.]
5.30 p.m.
House again in Committee.
Schedule 2 [The Commission for Health Improvement]:
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 83:
Page 48, line 9, at end insert ("at least three of whom shall be lay members representing all sections of the community including older people").
The noble Baroness said: We now move from the commission for long-term care to the commission for health improvement. Indeed, we are looking at the question of appointments to the commission for health

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improvement. Those provisions are set out in Schedule 2 to the Bill. As it stands, other than the appointment of a chairman and a representative for Wales, the schedule does not specify how many members there shall be or from which professions they may be appointed.
Once again, the question posed in these amendments is about how far we want the commission to be dominated by healthcare professionals or how far we wish to see wider representation from the community on the commission for health improvement.
The amendments which we have tabled propose to widen the membership to include lay members, including older people; to have representatives from the professions allied to medicine and from the universities; and to include NHS managers and representatives of users in the form of patients and carers.
A key issue covered by the amendments—and in particular Amendment No. 84, in the name of the noble Lord, Lord Harris, and Amendment No. 86—is whether there should be a majority of lay members on the commission for health improvement. In other words, is it to be an organisation established to provide an independent check on local systems of monitoring and improving healthcare which is to have a majority of health professionals judging themselves or is it to have a majority of people from outside the health professions? On these Benches, we should prefer to have a majority of lay members on the commission.
In addition, we recognise the contribution which other organisations can bring to the commission. We believe that it is extremely important that there should be representation from users, patients and especially older patients, carers and the voluntary organisations which represent them. It is important that a variety of skills which make up the NHS are represented on the commission. In that regard, I mention in particular the professions allied to medicine—physiotherapists, radiologists and also NHS managers and their representatives.
Finally, I make a special plea on behalf of the academics who are among the key partners. Academics who are part of medical faculties spend half their time providing patient care. The role of academics as leaders in their disciplines of evidence-based developments of clinical care will be vital to the commission's work. Amendment No. 88 is essentially a probing amendment to discover whether the Government have in mind that there will be significant academic representation on the commission. I commend the amendment to the Committee. I beg to move.
Lord Astor of Hever: I rise to support Amendment No. 83. The demographic explosion which is currently taking place as a result of an ageing population poses enormous ethical and economic problems. That is particularly true with regard to healthcare provision.
Charities which work with older people are worried that age will be used increasingly as a factor in determining whether or not someone receives treatment and what priority the patient is given. I trust that the
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Minister will be sympathetic to an amendment which seeks to ensure that older people are represented on the commission. As such, they would be well placed to ensure that the issue of age discrimination is brought to the fore in any discussions regarding treatment. I cannot believe that the Government would support discrimination against such a vulnerable section of society.
Baroness Gardner of Parkes: I support these amendments. As the Committee will know from our previous deliberations on the Bill, I am not in favour of having a great professional majority. Likewise, I should not wish to see a great lay majority. There should be just a majority of lay members. That means that people must attend the meetings and there is no guaranteed in-built majority for any group. If there is, people become lazy and do not turn up at the meetings. That throws out the whole balance.
When the Minister replies, I ask her to define the word "older". We have discussed already the definition of "older" and the Minister suggested that perhaps 60 was an appropriate definition. Many Members of this House would not consider 60 to be "older". Therefore, perhaps the Minister will be rather more specific than are the provisions of the amendment.
Lord Renton: I suppose that I should confess that I do not feel much different now from how I felt when I was 50. I am sorry to be so personal but I just wished to mention that because I do not want to talk about old age.
I seek some clarification of the word "lay" in the amendments. That word necessarily varies according to the context. If one is setting up a supervisory body over lawyers, "lay" means anyone who is not a lawyer. But here we are setting up a supervisory body over doctors, nurses and administrators within the health service who may be of a very large number. I ask the noble Baroness who moved the amendment whether she will tell me, perhaps even before the Minister replies, what is her opinion of the meaning of the word "lay" in that context.
Lord Walton of Detchant: I wish to ask a question about that particular point. In the health service there are many healthcare professionals and many different categories. There are administrators and a great many other people who, in certain respects, may be regarded as lay individuals. Hence, the definition is important.
It seems to me that Amendments Nos. 83 to 88 have a great deal to commend them because they specify rather precisely the kind of individuals who should be appointed to the commission for health improvement.
Having said that, I believe that there is one problem of which the Committee should be aware to which we have referred on earlier clauses in the Bill. It would be dangerous to be over-specific in relation to the membership of such a body. On Thursday afternoon, as we now know, we shall examine the role of the regulatory authorities in the health field. For example, the General Dental Council has been anxious for many years to increase its lay membership but is unable to do so without primary legislation. We must ask ourselves

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how specific we should be on the face of the Bill. May it not be more appropriate for the actual membership of the commission to be defined more precisely in secondary legislation rather than on the face of the Bill? That is merely a question that I wish to pose to those who have tabled the amendments.
Lord Harris of Haringey: My starting point in tabling Amendment No. 84 was that I agree with Bernard Shaw that,
"All professions are conspiracies against the laity".
I was delighted to hear the noble Baroness, Lady Gardner, support the amendment, because I have not called for a greater majority of lay representatives, but I believe that there should be a majority of lay representatives. And the noble Lord, Lord Renton, raises an important point in relation to definitions of "lay"; it sometimes seems to be an extremely flexible term. I am conscious from my background in community health councils that those councils, which I had always understood were lay organisations, sometimes had quite prominent members. To take but two examples, there was a retired consultant geriatrician and a practising dentist on one council, neither of whom seemed to me to be that "lay" a person.
Given that there is widespread concern about the system of professional self-regulation and that the new commission will play an important part in reassuring the public about health service standards and quality, it is important that the intelligent lay person is clearly represented on that body. I noted that in the Government's White Paper—A First Class Service—there was a reference to,
"The Commission will need to provide a balance of expertise and experience and this will be reflected in its membership which will be drawn from patients, the professions, the NHS and academia".
I hope that a significant part of that—a majority but not a great majority—will consist of lay people who are not themselves practising or retired clinicians, but people who are able to bring a perspective of ordinary common sense of what it feels like to use the services in question. That seems to me to be the core definition.
Lord Rea: If the actual composition of the commission is not to be on the face of the Bill, can my noble friend give an indication of the underlying principles on which the members of the commission are to be selected? In particular, will it be part of those principles that the commission will have expert public health advice, particularly people who understand health statistics and epidemiology on which the whole measurement of health is based?
Baroness Sharp of Guildford: I endorse the definition given by the noble Lord, Lord Harris, of the concept of a "lay" member. From these Benches we believe that the definition is someone who is not actively engaged in the provision of services within the National Health Service.
5.45 p.m.
Baroness Hayman: Perhaps I can pursue that issue. I am not sure that that will fit the bill in all
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circumstances. I, too, was once asked to be a "lay" member of a Royal College ethics committee. I was told that I would be one of three lay members and felt enormously reassured by that because I would not be alone. I then found that, of the other two, one was an emeritus professor of moral theology and the other was the senior partner of the leading firm of medical litigation lawyers in the country. As I understood it, I was there to speak for the women of Britain. So we can all find ourselves in situations where the definition of "lay" is not as it would appear to the uninformed observer, and I accept the spirit of the argument.
Also, I recognise that in your Lordships' Chamber the definition of over 60 as "older" may not necessarily gain approval; outside your Lordships' Chamber it might be considered more acceptable given current retirement patterns. However, questions of definition should go back to the proposers of amendments rather than to the Government, who felt it better not to include them in the first place. I am much reassured by the comments of the noble Lord, Lord Renton. I was feeling considerably older as I approached my 50th birthday, but if I continue to feel the same way for decades to come then I think I shall be all right.
Returning to the amendment before us, the Government share the concerns expressed by the Committee today that the commission should have the right balance of membership to ensure that it undertakes its work effectively. It is important that the commission has the respect and confidence of the public and the NHS, of those who make use of the NHS as patients and carers, and of the staff who deliver the services. In that context, the points made in relation to the role, for example, of appropriate public health advice, the role of academic medicine and the role which has been focused on most, that of a lay membership with personal experience of using NHS services, are extremely important.
In A First Class Service we highlighted the need for the commission to have access to a wide range of experience and expertise drawn from those with clinical and other professional backgrounds, academia, management and a lay membership. We also made it clear that appointment would be on merit rather than representative of any specific interest or group. That is important. If we look at concern for the elderly, that should not be compartmentalised and be the responsibility of only one member of any board or commission.
The proposals we put forward met with broad support and the Explanatory Notes, at paragraph 138, stated that the commission's membership will include those with a lay background. Recognising also that the commission will cover England and Wales, in this one instance the Bill makes explicit provision for its membership to include a member appointed by the National Assembly for Wales who will make the special interests of Wales his or her personal care.
Members of the Committee can be assured that careful consideration will be given to appointments to the commission. The process will be open and in line with guidance issued by the Commissioner for Public

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Appointments. We intend that the commission's lay members should provide broader views and experience. They will provide an essential and major contribution to the commission's approach. We also made it clear that we felt that the commission should have a lay chair.
It was useful to hear the comments today of Members of the Committee. They will help us as we give further thought to the commission's membership and take recruitment further. For the reasons discussed in earlier debates in Committee relating to the possible exclusivity of lists, it is not essential to specify those on the face of the Bill. However, I hope that Members of the Committee will feel that we have given and will continue to give due weight to the need particularly to ensure that the commission has effective lay members and that it includes a broad range of expertise and experience.
Baroness Sharp of Guildford: I thank the Minister for that forthcoming reply to the series of amendments we have been debating. It has been an extremely good debate and I take on board her assurances that the Government will be looking at a broad membership in considering appointments to the commission for health improvement. I noted in particular the mention that the chair would be a lay representative. We are encouraged by that reply and therefore I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 84 to 88 not moved.]
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 89:
Page 50, line 16, after ("State") insert ("and to the Public Accounts Committee of the House of Commons").
The noble Lord said: The spirit of this amendment is very much on the lines of the theme that we have tried to introduce; that is, improved transparency throughout the Bill. We talked earlier about reports from primary care trusts. Now we are in the area of reports, and the publication of reports, from the commission for health improvement. Amendment No. 89 deals with an obligation to publish reports or to submit reports to the Public Accounts Committee. The other amendments relate to the Secretary of State's obligation to provide wider publication.
The functions of the commission for health improvement are set out in Clause 15. They include: making reports on the arrangements that PCTs and NHS trusts have for monitoring and improving the quality of healthcare; making reports on the management and provision or quality of healthcare for which health authorities, PCTs or NHS trusts have responsibility, and making reports on the management, provision or quality of, or access to or availability of, particular types of healthcare for which NHS bodies or service providers have responsibility.
Clause 15 currently states that the Secretary of State may, by regulations, make provision as to the publication of reports and summaries of reports of the commission for health improvement. Schedule 2 states that the commission must report to the Secretary of State
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after each financial year on the exercise of its duties during the year and must provide the Secretary of State with such reports and information relating to the exercise of its functions as he may require.
In the interests of freedom of information, we believe that all of the commission's reports should be published and made available to the public, who have a right to know about the standards and quality of care being provided to them. In the event of a failure of standards, it will be even more important that information is made available to the public in order to avoid any fears of a cover-up and so that accountability can be properly exercised.
In cases where mistakes or accidents occur in the delivery of health services, it can be particularly upsetting for patients and their relatives to be left without a clear idea of what went wrong. It is probable that, at some time in the future, the commission may find itself investigating such sensitive and difficult cases.
The amendments in this group, from Amendment No. 91 onwards, would ensure that the Secretary of State does not have power to withhold any of the commission's reports from the public domain. Instead, the amendments would ensure that all the commission's reports were published and that the commission could also initiate publication of any other reports and information that it saw fit, without having to be requested to do so by the Secretary of State.
As regards the obligation to report to the Public Accounts Committee, I have no doubt that Members of the Committee have read a number of excellent reports from that committee. I can commend one in particular—by way of a plug for a debate on Wednesday—that it published on cervical cancer screening. That report shows that the committee has a good grasp of health issues. Such provision would be a good way of bringing into the public domain the reports of the commission for health improvement so that it is not simply at the discretion of the Secretary of State for Health to decide whether or not to publish. I beg to move.
Lord Renton: I hope that my recollection is not wrong. The Minister will, I am sure, from her experience—which was also in another place—correct me if I am wrong, but I hope that she will confirm that the Public Accounts Committee had, as of right, the opportunity to look at the public accounts of any body appointed by statute. If we start to say that, by statute, a particular body may have its accounts so scrutinised, we may get into an unfortunate situation. If that were done too often, and then there is no mention of public accounts being available for scrutiny by the Public Accounts Committee, they could not be so. Therefore, I think that we have to be very careful about Amendment No. 89. I really do not see the need for it.
As regards the other amendments in this group, I do not think that the noble Lord has developed those to any great extent. At the moment, I have no comment to make on them.
Baroness Hayman: Perhaps I may look at the general intention behind this series of amendments and say to

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the noble Lord, Lord Clement-Jones, that I recognise that intention. Indeed, I share it, if it is to ensure that the commission, as an executive non-departmental body, operates in a fully open and accountable way. We are determined that that shall be so.
However, I believe that we have already made adequate provision for that within the Bill. Clause 15 makes clear that the commission will make reports on the exercise of its functions. The Explanatory Notes also clearly state the intention to make those available to the organisations involved and to the Secretary of State, and to make provision for their publication.
The commission will be able to report on its findings. Importantly, it must be recognised that, in doing so, the commission will provide an external and independent assessment of NHS arrangements to improve quality. Thus, Clause 15(2)(d) allows for the Secretary of State to make regulations as to when and how the commission publishes its reports.
A key aim will be to ensure that the Secretary of State may make provision for the commission's recommendations to be published quickly after a review or investigation so that the organisations involved may act on the report as soon as possible and that others may learn from it.
Where the Secretary of State asks the commission to report to him on the exercise of its functions, the Secretary of State will decide on the arrangements for publication. In doing so, he will have due regard to the Code of Practice on Access to Government Information. I have to say that it would be our intention that such reports should be made public. They are obviously of general interest. However, equally I have to say to the noble Lord that the Secretary of State might ask for something much more run-of-the-mill in terms of a publication and that to have a general duty to publish everything might not be sensible.
Amendment No. 89 seeks to ensure that the commission's annual report be sent to the Public Accounts Committee. I believe that on this point the noble Lord, Lord Renton, is absolutely right in terms of the role of the Public Accounts Committee. We do not need to list it on the face of the Bill to ensure that it would have a role over a non-departmental public body. However, it is certainly the intention, as far as the annual report is concerned, that it would be sent to that committee as well as being made generally available as a public document.
Schedule 2 also makes clear that the annual report will not be the only means by which the commission is to be held to account to the public and to Parliament. It will be subject to the Parliamentary Commissioner for Administration, and members of the commission may be called before the Select Committee on Health and, indeed, the Public Accounts Committee of another place.
These provisions in the Bill demonstrate a commitment to openness, greater transparency and accountability both to the public and to Parliament. It would not be sensible to put on the face of the Bill provisions to ensure that everything on which the commission reports is automatically made public. It is
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sensible for the Secretary of State to have some discretion in this matter, particularly having regard to the delicacy and confidentiality of some of the subject matter that might possibly be involved.
However, I hope that I can reassure the noble Lord that, as far as the generality of reporting arrangements is concerned, we would wish the commission to operate in a transparent way.
Lord Clement-Jones: I thank the Minister for that helpful explanation of how the Government see the reports being published in what she describes as a fully open and accountable way. We shall certainly look at what she says with great care. However I believe that much of what she said was reassuring.
Before I seek leave to withdraw the amendment, perhaps the Minister could clarify one matter. I believe that she mentioned that the commission for health improvement was to be treated as a non-departmental public body in terms of its relationship with the Public Accounts Committee. Can she direct me to where that appears? Is it in the Explanatory Notes? I cannot see, on the face of the Bill, as regards CHI, or CHIMP, as others like to call it, that that is so. However, if that is the case, I am more than happy with the relationship that it will have with the Public Accounts Committee. If the Minister wishes to write to me on that point, I would be more than happy.
Baroness Hayman: I shall certainly write to the noble Lord, giving chapter and verse. Implicit in the need for the body to be set up statutorily is the fact that CHIMP is to be independent. The national institute for clinical excellence is being set up as a special health authority. That shows the distinction between the two. However, perhaps I may write to the noble Lord with the details.
6 p.m.
Lord Clement-Jones: I thank the Minister for that reply. It is precisely because of the issue of the status of the commission for health improvement that we have asked about publication and the relationship with the Public Accounts Committee. We want the body to be independent. At Second Reading I referred to the way in which Her Majesty's Inspector of Prisons has a particular status relative to the Home Office so that he can go about his business entirely independently. The commission must operate in that way. I shall be most interested to see the Minister's reply but, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 90 to 93 not moved.]
Schedule 2 agreed to.
Clause 15 [Functions of the Commission]:
[Amendments Nos. 94 and 95 not moved.]
Lord Harris of Haringey Lord Harris of Haringey moved Amendment No. 96:
Page 11, line 29, at beginning insert ("giving due consideration to any concerns of the relevant community health council,").
The noble Lord said: This clause sets out the functions of the commission for health improvement. Within those functions, it is clear that the commission is intended to provide an independent scrutiny of local efforts to improve quality. It will seek to ensure that serious problems are addressed and will be able to spot check quality standards.
Amendment No. 96 seeks to give community health councils a role which would effectively enable them to act as trigger mechanisms for the commission. Given that community health councils have extensive local knowledge of health provision and are often aware of where problems lie, that seems a helpful mechanism to ensure that the commission pursues issues relevant to local communities.
Community health councils assist complainants with some 30,000 NHS complaints each year. That work provides them with an unrivalled source of information about where the problems in service delivery may lie. Again, that seems an excellent qualification for enabling them to assist the commission.
I recall that in 1992 the Association of Community Health Councils and Action for Victims of Medical Accidents (AVMA) drew up proposals for a health standards inspectorate. In many ways, CHIMP bears some resemblance to those proposals. I should have thought that the commission would want to use the expertise of local community health councils and bodies such as AVMA to identify patients' complaints in order to guide its investigations.
Amendment No. 101, which is grouped with Amendment No. 96, refers to the commission's report and suggests that such reports should automatically be made available to community health councils to assist them in monitoring the commission's progress. It may seem self-evident that reports should be provided in that way—one would certainly expect the commission's reports to be made public—but it is perhaps worth stating that, in the interests of freedom of information, it is important that the commission's reports are published and made available to the public who have a right to know about the standards and quality of care being provided to them. In the event of a failure of standards, it would be even more important that such information should be made available to the public to avoid any fears of a cover-up and so that the accountability can be seen properly to be exercised. Where mistakes or accidents have occurred in service delivery, it is particularly upsetting for the patients and their relatives to be left without any clear idea of what went wrong. It is probable that at some time in the future the commission will have to investigate such sensitive and difficult cases.
I should have thought that requiring the commission to make its reports available to CHCs would increase public confidence in the work of the commission and enable the CHCs to monitor the progress made with regard to any of the commission's recommendations. I beg to move.
Baroness Hayman: Both of these amendments seek to place on the face of the Bill arrangements to ensure
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that community health councils are involved with, and informed about, the commission's work. My noble friend has made clear why he thinks that that is appropriate. I recognise and welcome the interest that CHCs and other groups representative of users, carers and local communities will have in the work of the commission and their potential to contribute. However, I must advise my noble friend—this is something of a current refrain—that I do not think that this is a matter for the face of the Bill or that individual organisations should be singled out in this way.
The regulations under Clause 15(2)(a) will provide for the manner in which, and the persons in relation to whom, the commission will perform its functions. We do not want unduly to restrict the commission's independence with regard to how it carries out its function to review clinical governance arrangements. In assessing how clinical governance is supporting the drive for high quality services, it will no doubt want to have regard to the knowledge and experience of CHCs. As my noble friend said, that is particularly relevant. Community health councils will be able to contribute to that assessment, as will a number of other community groups and patient and carer representatives.
Equally, it does not seem necessary to require on the face of the Bill that the commission, when conducting a national service review, should make its reports available to the relevant community health council. As was discussed earlier, we intend to provide for the publication of the commission's findings. Therefore, they will be available as public documents to CHCs and other interested organisations. On that basis, I hope that my noble friend will accept that I understand and sympathise with his intentions, but believe that the Bill already covers his concerns. I hope that he will feel able to withdraw his amendment.
Baroness Fookes: I have considerable sympathy with the amendment. It seems to me that responsibility for making available, and publication of, such reports rests very much with the Secretary of State. As the Minister indicated earlier, on the face of the Bill, the Secretary of State has total discretion about what is published, not just some discretion. It is important that we are clear that publication should generally take place. It may be that the present Government are much committed to open government, but we are making provisions for the future—and a future Secretary of State might be of a more secretive nature. That is why we are relying on what the Bill states.
Baroness Hayman: We covered this issue earlier. It is our intention to act publicly and openly in such areas. The provisions on how the recommendations should be made public, quickly if necessary, relate to simply functional arrangements. We have a code of practice on access to government information and we may well have more far-reaching freedom of information legislation to deal with such areas. Therefore, in the long term, I believe that these points will be covered. However, again, I do not think that we can deal with the general

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issue to which the noble Baroness refers by amendments such as these, which deal only with community health councils.
Lord Harris of Haringey: I am grateful to the Minister for that response, I take her point that it may not be appropriate specifically to single out community health councils on the face of the Bill. However, I hope that it may be possible either in regulations or in guidance to the commission to suggest that it should be a priority for the commission to listen to, and to seek representations from, local community health councils when considering what work to carry out, and to direct the attention of local CHCs, where appropriate, to the reports published. I appreciate that the reports will be in the public domain, but there is a difference between that and reports specifically being drawn to the attention of local bodies which can keep track of what has happened as a result of them. I hope that the Minister will revisit some of these questions in terms of regulations or guidance. In the meantime I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 97 to 107 not moved.]
The Deputy Chairman of Committees (Viscount St. Davids): Before calling Amendment No. 108, I should point out to the Committee that, if Amendment No. 108 is agreed to, I cannot call Amendment No. 109.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 108:
Page 12, line 10, leave out from beginning to (", and") in line 12.
The noble Lord said: This is, unashamedly, a probing amendment. It would clearly remove the power of the Secretary of State to issue regulations enabling the commission for health improvement to recover money in respect of expenditure it incurred in the exercise of its functions. The effect would be that the commission could not charge fees or be self-financing, but would have to be government funded.
Our interest was drawn to this provision allowing the Secretary of State to make regulations in this way as it is not clear who will be charged or what institutions will be charged by the commission. Clarification is required about the degree of funding that the commission will receive, on the one hand from central government and, on the other, from the charges that it makes. If it is expected to become self-financing over a period of time, what is that time period? What charging structure does the department believe is appropriate? Can the Minister clarify whether Ofsted or HM Chief Inspector of Prisons are charged for inspections? What is the practice across government? Is it a common practice? Is the commission being singled out for this kind of purpose and what is the broad time scale?
Major sums could be involved. If, in looking at the GMC Bristol-type case, the commission also looks at the non-competency related aspects, the sums incurred could run into millions. Are we saying that that particular hospital would be responsible for the charges of the commission? We want to elicit the basis upon
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which the commission will be operating. We hope that the Minister can give further information in that regard. I beg to move.
Lord McColl of Dulwich: I should like to speak to Amendments Nos. 109 and 110 which do not go nearly as far as Amendment No. 108. The Bill allows CHIMP to recover from any individual costs incurred in the course of its duties. In theory this would permit individual GPs to be billed for the work of CHIMP. In exceptional circumstances, this could exhaust the entire budget of a PCT, if a particularly lengthy report or investigation were undertaken.
By changing the word "persons" to "bodies", the amendment does not give total protection against such circumstances, particularly for PCTs. However, it allows a greater degree of protection to individuals who could otherwise face very large bills for investigation by CHIMP which they did not request and over which they had no control.
There is an additional worry that the powers of CHIMP to recover costs could be used to recover the costs of NICE in situations where CHIMP has followed up the work of NICE in a particular area. That would represent an additional cost and would take away money from frontline services in order to finance bureaucratic activities. As NICE is not included in the Health Bill and is not a statutory body, it would be quite wrong to use CHIMP as a means of clawing back the costs of NICE.
If the Secretary of State had intended NICE to be part of the statutory body with powers to cover its own costs, that should have been included in the Health Bill. As the Government have decided that NICE does not need to be included in the Health Bill and can be dealt with by order, one has certain suspicions as to the actual powers and scope for action and cost recovery that NICE will have.
6.15 p.m.
Baroness Hayman: I hope to be of assistance to the Committee on the general probing issues and the specific points about recovery of funds from other bodies, and the possibility of charging individuals, which was raised by the noble Lord, Lord McColl.
Initially, while the commission is developing its role we do not envisage that it would charge any individual organisations for the bulk of its local review work. But in the longer term, once the commission has demonstrated its effectiveness as a body to help the NHS improve quality and tackle service problems, we see merit in moving towards a system where more of the commission's work is directly funded locally.
It is not an unusual arrangement. For example, it applies in the case of work carried out by the Audit Commission for NHS bodies, and that would include the

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value-for-money studies which are very much in line with some of the work that the commission would be doing.
Lord Clement-Jones: NHS trusts are charged on an individual basis by the Audit Commission for value-for-money work, are they not?
Baroness Hayman: They certainly are, and the rates, the number of days and all sorts of things are determined for you. The trusts pay individually to the Audit Commission.
Lord Clement-Jones: This is work that they commission of their own volition; it is not imposed on them that they should invite the Audit Commission in; they invited the Audit Commission in, and it is only fair in those circumstances that they should pay.
Baroness Hayman: No, it is an analogous situation to the commission. If the Audit Commission was doing a national value-for-money study and was looking at an individual trust, that trust would pay towards that study in the same way as the commission might look at implementation of a national service framework and therefore charge the individual institution for that work.
This is a developmental agenda and an enabling provision, but it is very much in line with work that has been carried out already and is analogous work to that of the Audit Commission.
The costs of the commission will not be met at the expense of direct patient care. Any charges will need to be offset by reductions in non-care expenditure elsewhere; for example, by ensuring more effective use of other external audits in order to avoid duplication and an unnecessary administrative burden, and by reducing the amount of resources currently spent on litigation and the other effects of poor quality care.
The Secretary of State will determine the level of the commission's charges and how and when they will be made. The costs of an investigation or review would have to take into account various factors, including the number of review days involved and the nature of the review. It is worth noting that the commission will be under a duty, set out in paragraph 3 of the schedule, to carry out its functions effectively, efficiently and economically, so it is not as though a blank cheque is being written.
I should like to move on to Amendment No. 109. The Bill allows the commission to recover costs from persons or bodies, and those will be set out in regulations. I can reassure the noble Lord, Lord McColl, that it is not the intention that the commission will charge individuals for its services. It will review the systems which NHS organisations have in place to monitor and improve quality and will investigate service problems experienced by an organisation. That is the approach which will inform regulations in due course. Nonetheless, we would not want unnecessarily to restrict the bodies with which the commission can work and recover costs. While it is not our intention to charge
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individuals or individual GPs as instanced by the noble Lord, the commission will, as we discussed the other evening, be looking at the healthcare provided to NHS patients by the independent sector. NHS bodies enter into agreements or arrangements with a wide variety of private individuals, organisations or bodies.
As I understand it, if we restricted the terminology of the Bill to the word "bodies", the legislation would not necessarily cover all the situations which might arise and for which the commission might need to recover charges. For example, services provided even by a private partnership might not be covered by the word "bodies".
I turn now to the issue of the recovery of funds from other bodies, which relates to Amendment No. 110. I suggest that this could lead to the undesirable result of the commission being prevented from working beneficially with other bodies. It will only recover expenditure which has been properly incurred and the costs of carrying out its own functions. For the avoidance of doubt, perhaps I may make it absolutely clear for the benefit of the noble Lord, Lord McColl. NICE will be centrally funded and that cannot be changed.
The commission will only recover expenditure under Clause 15(2) where it has been directly incurred by the commission. If the expenditure is not incurred by the commission, there is no power of recovery. However, we need that power because in the course of its work the commission for health improvement may wish to draw on the particular expertise of other bodies, such as the Audit Commission. In assisting the commission those bodies would incur costs which they might wish to recover. The commission may meet those costs by making payments to those bodies in respect of the work carried out. This will be expenditure which the commission could recover under Clause 15(2)(e).
As it stands, the amendment would confuse the matter and might suggest that the commission could not recover costs in so far as they may be related to the making of such payments. Therefore, it would cast doubt on the extent to which the commission could be assisted by other bodies. We believe that that would be undesirable. The commission needs to be able to recover costs incurred in engaging other bodies to assist in its work. That is why we need the provision and not, indirectly, to fund inappropriate bodies—and certainly not indirectly to fund NICE. We must recognise the fact that there may be an area of joint working using someone else's expertise for which the commission needs to have some flexibility. Therefore, it is appropriate for the commission to be able to make charges under the provision.
Baroness Fookes: It seems to me that the Minister's reply actually causes one to ask more questions. First, will the bodies that might be charged at some stage be expected to include an element of that in their budget for the year? How can that not affect patient care in the

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sense that it is a charge upon them? Secondly, is there some kind of appeal system if it is thought that the charges made are exorbitant or unreasonable?
Baroness Hayman: I tried to cover such issues in my response. There are management costs which are part of running any organisation. I have in mind costs like publishing an annual report—some Members of the Committee are anxious about that—which are met. Of course, if you are incurring such costs, you are not spending that money on patient care. Nevertheless, they are considered to be part of, and a contribution to, providing high quality, accessible and publicly-transparent care. I am sure that Members of the Committee who have worked in the health service are aware of these circumstances. I do not believe that there is any appeals mechanism against the scales of payment of the Audit Commission or, indeed, its allocation of numbers of days to carry out the work.
We believe that the work that the commission will do for organisations will not just be some added bureaucratic cost; it will actually be an important input into improving quality. As we have discussed at other points in our debates on the Bill, improving quality is not necessarily something which always costs more. Indeed, in the long term, it can actually save money.
Lord McColl of Dulwich: I may be wrong, but I believe I heard the Minister say that she was a little concerned about private partnerships and that that is why we get into difficulties when using the word "bodies". However, I thought that there was no intention of applying CHIMP to the private sector.
Baroness Hayman: There is no intention of applying the commission to the private sector as regards providing care for private patients. However, we recognise that it might well have a role in relation to the provision of service to NHS patients in private establishments. It is in those circumstances that the need for some flexibility of terminology may arise.
We discussed the provisions about quality and the commission in regard to the private sector very late at night. I made it clear then that the commission would have a role to play both in the provision of care to NHS patients in private institutions and indeed in the provision of private care to private patients within NHS institutions.
Lord Clement-Jones: I thank the Minister for that reply. However, I agree with the noble Baroness, Lady Fookes, that the response raises more issues than even I had thought of when I tabled this probing amendment. The problem with these inspections is that they will be undertaken without the trust really having much say in the matter. The commission will review or investigate and, despite the fact that the charges will be set by the Secretary of State, the trust will really have no say in it. It will not be a contractual bargain; indeed it is not like a piece of management consultancy being undertaken by the commission.
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I accept the fact that the Audit Commission may well have been able to do exactly the same in the past, but I am afraid that I do not believe that that is necessarily the best course for the commission to follow. The point was rightly made by the noble Baroness, Lady Fookes. I say that because if we look at it closely, we have to ask: where does the money come from? For example, an NHS trust may be charged by the commission for undertaking a review. It may have been a particularly bad assignment which cost a great deal of money. Where does that money come from? Well, it comes out of management fees, IT costs or something of that nature. What we are saying is that a failing hospital actually has to pay more to CHIMP than perhaps the more successful hospitals. That kind of spiral cannot be correct. However, if the Minister then says that the Secretary of State will ensure that such a hospital has enough in its budget to pay the commission in those circumstances we are just talking about exchanging wooden dollars between the NHS trust and the Department of Health. That does not seem a very sensible way forward.
I shall seek to withdraw the amendment, but clearly we shall need to look again at the matter on Report. It seems to me that there are potential problems for budgeting at NHS trust level if the Secretary of State simply allows CHIMP in due course—I accept the fact that it may well take place over a period of time—to levy charges on trusts where it has not been part of their request for CHIMP to come in.
6.30 p.m.
Baroness Hayman: I am grateful to the noble Lord for those comments. I tried to make it clear that we were talking about moving towards a system where more of the commission's work was directly funded locally. The noble Lord may have highlighted a situation involving great difficulties where a major investigation is carried out where this provision is not necessarily appropriate. As a general rule we believe that this provision will encourage greater involvement in reviewing an investigation and will lead to wider ownership of the results, particularly when an organisation has invited the commission to investigate.
However, I must put the other side of the argument. If this can be done only at the invitation of an organisation, that could enable people to opt out of monitoring their arrangements for clinical governance. That would not be appropriate. I am happy to consider the issue in the light of the comments that the noble Lord has made but I believe that some of the problems that have been highlighted are perhaps not as great as the Committee may think.
Lord Clement-Jones: I thank the Minister for that reply and particularly for her undertaking to consider my comments. I understand the comments she has made. I also understand that a trust will become more involved in this matter if it is picking up part of the bill. But if at the end of the day budgets are effectively reduced, albeit not as regards patient care, that will constitute a considerable injustice when these organisations are trying to improve standards by inviting CHIMP to

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monitor them. In many respects standards are improved as much through the money that is spent on patient care, as perhaps through the number of managers in a hospital, through IT or through other aspects.
Baroness Hayman: But the money does not grow on trees. If the commission were centrally funded by the Department of Health, the money would be top-sliced from the money that would go into patient care nationally. It is not that we suddenly have extra resources for patient care; it is a matter of whether the money is taken off through top-slicing or at the individual institution level. We should not think that there is a pot of gold to meet the cost if it is not met within the health service.
Lord Clement-Jones: I fully accept that and I shall not extend this debate any further. However, one faces a situation where one simply exchanges "wooden" money between trusts and the Secretary of State, unless the trusts which are under the greatest degree of investigation by CHIMP effectively pay CHIMP's costs in the future and therefore cut their budgets in some cases in the very areas where they need to make improvements. Therefore they are working with one hand behind their backs. I shall withdraw this amendment but I may return to it on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 109 and 110 not moved.]
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 111:
Page 12, line 15, at end insert—
("( ) Notwithstanding subsection (2) the Commission shall be entitled to exercise any of the functions set out in subsection (1) as a result of its own decision or on a complaint being made by a member of the public or of NHS staff.").
The noble Lord said: One of the key issues surrounding the powers of the commission for health improvement concerns whether it will be able to exercise its functions of its own motion, or whether in every case it will effectively work only at the behest of the Secretary of State. It is important that we should clarify for the purposes of this debate whether that is the case.
This amendment would mean that the commission could exercise any of its functions in response to a complaint from a member of the public or NHS staff. This could include complaints or concerns raised by CHCs or other groups representing patients or users. It is important that the commission for health improvement should be able to respond to concerns raised by members of the public, community health councils, NHS staff and the professional organisations that represent them. In the past staff have sometimes felt powerless to raise concerns about poor practices or low standards because of the fear that they would be victimised for whistle blowing and that no positive changes would result. Certainly such representations have been made to me. I welcome the steps the GMC has taken in this direction. A culture where genuine whistle blowers are shunned or bullied out of their jobs
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must be consigned to the past and a more open culture of effective clinical governance must prevail. For the Government's agenda of improving quality in the NHS to succeed it will be vital that effective systems of clinical governance are created, but these need to be broadly based involving all professional groups with no single group having dominance. Clinical governance will need to incorporate clear procedures for staff to follow if they are concerned about failing standards.
For all of this to work it is vital that NHS staff and the professional organisations representing them are able to raise concerns directly with the commission. Although this provision may be rarely used, it is important that staff feel able to make changes from within the workplace and speak openly to their managers about standards and quality of care.
Therefore we believe that for the commission to carry public confidence it must have the power to respond to concerns raised directly by the public. A full investigation may not always be necessary in every case, but the commission must be set up in a way which allows it to be responsive to public concerns. This could lead in some cases to problems being nipped in the bud as public concerns could trigger early intervention from the commission rather than having to wait until the problems are so grave that they reach the attention of the Secretary of State. I beg to move.
Baroness Cumberlege: I understand the Government's wish to establish national bodies such as NICE and the commission for health improvement and to establish service frameworks. However, I think there is a penalty to be paid for all of this. I understand what the noble Lord, Lord Clement-Jones, said about whistle blowing and staff having an opportunity to express their concerns when they feel there is a low quality, low standard of service being provided. But the penalty of that is that all the time one is bypassing local management, and indeed management higher in the chain. Staff who wish to make a complaint have opportunities to do so. They can make a complaint to their immediate managers, the chairman of the board and the non-executive directors. They can also approach their professional bodies and trades unions. They can approach the ombudsman and local MPs. As regards employment issues, there is a whole legal framework in terms of tribunals and other such provisions. In certain circumstances they can approach organisations such as the Commission for Racial Equality.
I am concerned that if we give more and more power to these bodies that are being established, they may not adopt a light touch. If they are given more and more power I believe that to some extent they will undermine local management. We know that the NHS succeeds where it has managers who are imaginitive, who are prepared to take risks, who know their staff, who walk the wards, who are involved in the community and work with voluntary organisations. These are the people who inspire others and obtain a much better quality of service from their staff. We should support those people. I am concerned that if we build up these mega bureaucratic,

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centralised organisations, we shall undermine the very people we should support. I am afraid that on this occasion I cannot support the amendment.
Baroness Hayman: This has been an interesting if short debate. I hope I can help by clarifying what I believe is the middle course that the Government envisage the commission taking between removing completely any idea of local responsibility for these issues and retaining the flexibility to respond when a matter that is raised by an individual, or a member of staff or anyone else is one that is appropriate for the commission to take forward.
The commission is being established as an independent body at arm's length from government. It is our intention that regulations made under Clause 15(2) will not prevent the commission exercising a discretion as to when it may carry out its reviews. This amendment raises the issue of NHS staff and members of the public being able to raise concerns directly with the commission. They will, of course, be free to do so. The commission will consider these and may decide to take action in a number of ways.
The commission's primary focus will be on organisational systems rather than the care provided to individual patients. But where an individual complaint indicates a wider significant clinical problem in an NHS organisation, the commission may wish to follow this up. It might, of course, wish to draw some complaints to the attention of the appropriate body; for example, the health service commissioner in cases of complaints about the care and treatment of individual patients, or the appropriate regulatory body where the concern is raised about the performance of individual clinical staff. The commission would, if it wished, be able to advance the place of an NHS trust or primary care trust within its rolling programme of local reviews as a result of concerns raised by the public or members of NHS staff about service problems that require continuing local action.
The commission may also wish to raise concerns about the public or a member of staff directly with the appropriate regional office, the NHS Executive or the health authority to check on progress made by the organisation concerned and to provide supporting evidence for the concerns. As a result, it might be agreed that the commission investigates further. The commission may also raise concerns brought to its attention by the public and NHS staff with the Secretary of State who will be able to direct the commission to investigate where necessary.
In all this, it will be important to ensure that the commission's help is targeted where help is needed most; that its approach is consistent with the objectives and priorities set for the NHS; and that the commission operates with regard to existing NHS mechanisms for assuring quality and tackling local service problems. I think that that is the issue to which the noble Baroness, Lady Cumberlege, referred. For example, there are already well-established arrangements for patient complaints, both locally and, ultimately, to the health service commissioner. The commission for health improvement is intended to complement these and not
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to be a substitute for them. I agree with the noble Baroness that, where they are working properly, that is the proper route through which individual concerns should be addressed in the first instance.
The new clinical governance arrangements which we are introducing to strengthen arrangements to assure and improve quality will provide clear channels for staff to voice concerns and to take account of patients' views, including concerns raised through the NHS complaints procedure. The commission will of course look at these aspects of clinical governance as part of its general programme of reviews.
I hope that the noble Lord will feel that there is already ample scope for patients and staff to raise concerns and for these to be properly and appropriately followed through. I hope therefore that he will feel able to withdraw his amendment.
Lord Clement-Jones: I thank the Minister for that reply, which I thought entirely satisfactory in terms of what will be regulated for under subsection (2) of Clause 15. If it comes about in the way she suggests, access to the commission will be entirely as we would have hoped. I do not think that anything she said or I said goes counter to the wish to keep the procedures, particularly since clinical governance will be a quite complicated area, as simple as possible. It is obviously the case that staff will try to gain remedies at local level under local clinical governance procedures. But as a safety valve, when other things fail, the commission may well be a useful port of call. The noble Baroness made clear that that will be available to members of the public, CHCs and staff in an entirely desirable manner. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
6.45 p.m.
Earl Howe Earl Howe moved Amendment No. 112:
Page 12, line 17, leave out ("be absolutely privileged") and insert ("have qualified privilege").
The noble Earl said: In an earlier debate I made so bold as to introduce a metaphor involving jungle animals—perhaps it was a little too colourful for the time of night—but, as beasts of the jungle go, "CHIMP" will, without doubt, be a creature wielding considerable power and influence if it so chooses—a power of entry to premises; a power to seize documents and information; a power to breach patient confidentiality in a surprisingly wide set of circumstances, which we will be discussing later; and, as we see from Clause 15(2) and (3), a power to say what it likes about someone and then to charge him for it.
I am sure we all understand that if a body like a commission is set up matters have to be arranged in such a way that it can do its job properly. But, equally, if it is to command universal respect from clinicians as well as patients and the public its powers have to be used responsibly. Many of CHIMP's functions will be advisory, but where it engages in the business of what is sometimes referred to as "naming and shaming"—something that no doubt it will need to do on rare occasions—it is important that it sets about its task in a

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sober, dispassionate, conscientious and expert fashion. It will not rush to conclusions; it will listen to both sides of the case; it will look at clinical treatments and clinical judgments in their full context; and it will take expert advice. The result of that measured deliberation will, I trust, be a published report which commands universal respect and confidence. That is the aim.
The point I want to stress is that it is not simply the result of the commission's work that needs to be right but also the way in which it reaches that result. Clause 15(3) provides for the publication of anything by the commission to have the status of absolute privilege in law. Very few bodies enjoy that privilege in statute. Absolute privilege is conferred by statute on the ombudsman, the MMC, the Director General of Fair Trading and certain statutory tribunals. It means that if something is uttered or written that enjoys the status of absolute privilege, it automatically falls outwith the scope of the law of defamation.
The question posed by my amendment is this: is it appropriate that the commission for health improvement, for all its important functions, should be able to say and write with impunity exactly what it likes about anyone? Qualified privilege, as proposed in the amendment, is a status which confers similar protection to absolute privilege, the difference being that it affords no protection against a suit for defamation if the publication concerned is shown to have been made with malice. To utter something with malice, as I understand the term in law—although I stand to be corrected by those more learned than myself—is to utter it knowing or believing it to be false or with a reckless disregard for the facts. The consequence is that if you say or write something in good faith and advisedly, a court will protect you in any suit brought against you for defamation.
The Government are saying in the Bill that the commission may not even be taken to court. It can say or write whatever it likes, even with a reckless disregard for the truth. But, as I pointed out, a reckless disregard for the truth is the very antithesis of the way that CHIMP will set about its work, or so we hope—and hope is all that we can really lay claim to at the moment. For a body with the extensive powers that it will possess, I believe it is right that the Bill should encourage it to use those powers responsibly.
I am the first to admit that we do not want to provide encouragement to anyone who might wish to try his luck in court by serving a libel writ on the commission, but I put it to the Committee that if the commission is as professional as we would all wish it to be, that is not a realistic anxiety. If the commission is not as professional as it ought to be, then a citizen who believes himself to have been defamed should enjoy the right of recourse through the courts. I beg to move.
Lord Renton: In my opinion my noble friend Lord Howe has moved a very important amendment. I hope that the noble Baroness, even if she cannot give a complete answer today, will consider the matter very carefully. I agree with my noble friend's statement of law. However, as the wording of subsection (3) stands,
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it is not merely a matter of the publication of formal reports, or annual reports, by the commission; the subsection provides that,
"the publication of any matter by the Commission shall be absolutely privileged".
That must be wrong. It could mean that if a letter is written by the commission or on its behalf which seriously damages the reputation of any nurse, doctor, dentist, health worker, or anyone else involved in the work of the National Health Service, whoever has written that letter can get away with it scot-free. That would be utterly wrong. I cannot believe that that is the Government's intention. If the noble Baroness is going to give a serious answer, perhaps she will say whether an exact precedent can be quoted in support of this provision. I doubt whether she can.
Absolute privilege is very limited indeed. I shall not enumerate the various circumstances in which it may arise. Some examples are reports of parliamentary debates; reports of judicial decisions; documents arising in the course of the law such as in indictment, and so on. To include in the Bill this huge opportunity for serious defamation entering a person's whole life is utterly wrong.
Baroness Thomas of Walliswood: In following the noble Lord, Lord Renton, on such a matter, metaphorically speaking I take my life in my hands. I certainly shall not challenge anything that the noble Lord has said.
I can understand that the Government might wish the commission, in publishing material, making reports and so on, not to be the subject of the kind of challenge that people and organisations might make even if they have been justifiably criticised because that criticism might make them less able, as it were, to attract custom. I can see why the Government might wish to provide that particular privilege. However, at the very least, it lays a considerable burden on the commission. The "naming and shaming" approach that we have seen in other inspectorates in different parts of the jungle (if I may use that expression) has been very damaging to the institutions so named and shamed. Indeed, it has often been entirely irrelevant to the good conduct of those institutions.
At the very least we need some reassurances as to what might result from subsection (4), which provides that,
"The Secretary of State may give directions with respect to the exercise of any functions of the commission".
What directions, if any, have the Government planned in order to circumscribe in any way the considerable powers that the noble Earl, Lord Howe, and the noble Lord, Lord Renton, drew to our attention in introducing the amendment?
Baroness Fookes: I am not a lawyer. However, this was one of the phrases that struck me forcefully when I first read the Bill. I am delighted that my noble friend Lord Howe has presented this amendment as an

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alternative to qualified privilege. The noble Baroness will have a hard job to prove to me that this is not a right and proper amendment.
Lord Walton of Detchant: This is a matter of fundamental importance. I wholly agree with the remarks made by the noble Earl, Lord Howe, and the noble Lord, Lord Renton. A number of situations have arisen recently whereby the publication on the Internet of documents placed before various public inquiries has given considerable concern as they have been exceptionally critical of various bodies and individuals. I believe that publication on the Internet would be covered by this provision. Qualified privilege is right, but absolute privilege would be totally wrong.
Baroness Hayman: This has been a brief, but deeply felt debate. I have listened very carefully to the opinions that have been expressed. I should say at the start that I concur with the analysis made by the noble Earl, Lord Howe, of the way in which the commission should approach its task. It should adopt a considered approach. There are responsibilities here of a broad and deep order, as well as important areas in which the commission will be able to contribute to public protection.
In the phrasing of the Bill as presently drafted there is absolutely no intention that the provision of absolute privilege should be used as some sort of smokescreen for behaving in a way that is less than proper in these areas. As I am sure noble Lords agree, it is important that the commission is able to be frank and open in identifying areas for improvement. It will be in the best interests of the public for the commission to have the ability to make clear where NHS organisations are failing to meet their statutory duty. It would also be in the public interest that the commission's resources are not unnecessarily diverted into supporting litigation and that the publication of reports is not improperly delayed because litigation is entered into for that purpose rather than any other.
I wish to reassure the noble Lord, Lord Renton, that this provision is not unprecedented. Bodies similar to the commission have statutory provisions of absolute privilege for their reports for the purposes of defamation. That includes the Health Service Commissioner, the Parliamentary Commissioner for Administration, the Occupational Pensions Regulatory Authority, the Director-General of Fair Trading and the local government ombudsman. So this provision is not outwith the line for other bodies operating in similar fields.
Absolute privilege will not be a licence for the commission to act recklessly. It will be bound by the rules of natural justice and will have to act fairly. It will therefore be the general practice of the commission to give an organisation that it proposes to criticise in its report a fair opportunity to comment before publication. It is not the task or aim of the commission to assess or make public a clinician's individual performance. The commission will look at organisations' abilities to provide high-quality care and the systems that are in place. If it finds evidence of poor individual
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performance, it will draw that to the attention of the employing organisation to take action, and may, if appropriate, bring it to the attention of the professional regulatory body concerned.
If a report were to contain defamatory material, an aggrieved individual could seek to prevent publication by seeking an injunction; but by conferring absolute privilege the person would not be able to institute such proceedings. However, in public law the person would be entitled to take judicial review proceedings if the procedure adopted by the commission had been unfair. That would provide some safeguards to the healthcare provision professionals who are the subject of the commission's investigations.
So the provisions as they stand on the face of the Bill are not completely outwith areas of—
Lord Renton: I thank the noble Baroness for giving way. Will she bear this in mind? As I recollect, the cases that she mentioned, and was justified in mentioning, are much more restricted in the grant of absolute privilege. On the other hand, this provision refers to:
"the publication of any matter by the Commission".
I am sure that the other cases mentioned by the noble Baroness do not go so far as that, although I should need to refresh my mind and go into the detail of them. I hope that she will bear that in mind.
Baroness Hayman: I shall bear it in mind and I shall investigate all the bodies that I have mentioned. As far as the pensions regulatory body is concerned, for the purposes of the law of defamation, the publication of any matter by that authority is absolutely privileged, so that is an analogous situation. However, I do not want to rest simply on precedent. Grave concern has been expressed by Members of the Committee. If the Committee will permit me, I shall give further consideration to the matter and perhaps we can return to it at a later stage.
7 p.m.
Baroness Gardner of Parkes: I have not intervened previously because I have agreed with everything that has been said. However, during the debate on the National Health Service some weeks ago I raised the issue of privilege in relation to internal inquiries in hospitals and referred to the fact that no privilege attached to those cases, as a result of which there was a disincentive for findings to be made completely open and clear. Will the Minister consider an extension of privilege in respect of such cases? Perhaps it would be appropriate to bring forward an amendment at a later stage of the Bill.
Baroness Hayman: I cannot give a commitment to bring an amendment forward, but that issue is the counter-balance to the one we have been considering today. I undertake that when I look at the question of whether absolute privilege is appropriate here I shall

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also investigate the matter which the noble Baroness raised as to whether some qualified privilege might be appropriate in other cases.
Baroness Knight of Collingtree: There has been a very slight shift of view from the Minister during the course of the debate but it has been so slight as to leave me without any feeling of confidence that the matters raised by my noble friends will be properly addressed. I cannot see why the slight change in wording from "be absolutely privileged" to "have qualified privilege" should be so hard to accept bearing in mind the clear feeling of Members of the Committee who have great experience in these matters. The Minister said at the beginning that she must listen but not that she must act. She later moved to say that she would consider the matter further. I hope that there will be a clear attempt to meet the concerns of Members in all parts of the Chamber.
Baroness O'Cathain: For once I disagree with my noble friend. I think that the Minister has moved considerably. Perhaps the problem is the shorthand way in which we talk about these matters. I congratulate the Minister because she has listened and has heard. We hope that she will come back with what we consider to be the right statement.
Baroness Hayman: I am grateful to the noble Baroness. Obviously I did not express myself clearly. I was trying to suggest to the Committee that the Government's original proposals were not without precedent and that we did not think that they were without merit but that I had listened carefully to the considerable concerns expressed in the Committee and that I should like a little time to consider the issue in the hope that we might be able to bring forward something at a later stage that would be satisfactory to the Committee.
Earl Howe: I am extremely grateful to the Minister. She is, as we all know, a listening Minister. What she has said is all that I could reasonably expect of her at this stage, after what has been a very useful debate. I am extremely grateful to all Members who have spoken.
Frankness and openness is all very well, but it cuts two ways sometimes. It is all too easy to imagine a situation in which it can lead to grave unfairness. The point of my amendment was to suggest that qualified privilege was a more than adequate substitute for absolute privilege. It would allow CHIMP to be totally frank and open because it would be possible to challenge it effectively only if it were shown to be malicious or if the information was known to be false.
I agree with my noble friend Lord Renton. I am not sure that the other examples of absolute privilege are entirely relevant in this context. We are relying on an assurance from the Minister that CHIMP will be entirely responsible. We all hope that it will be. She believes that it will be and I am sure that most Members of the Committee believe it will be, but that is all we can say at the moment.
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The point raised by the noble Lord, Lord Walton of Detchant, is extremely pertinent. The accidental release of otherwise confidential documents or comments on the Internet or indeed in any other way makes one all too conscious of the issues here.
My final comment relates to what the Minister said about judicial review. I do not believe that judicial review would provide a proper safeguard. It would allow for challenges against the commission's work only where it was seen to be ultra vires or in matters where the commission had judged in its own cause. I am not clear that judicial review is an adequate substitute. However, I am grateful to the Minister for what she said and for the time being I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 113 and 114 not moved.]
Clause 15 agreed to.
Clause 16 [Obtaining information etc.]:
[Amendments Nos. 115 to 117 not moved.]
Lord McColl of Dulwich Lord McColl of Dulwich moved Amendment No. 118:
Page 13, line 22, after ("individual") insert ("or a deceased person").
The noble Lord said: In moving Amendment No. 118, I should like to speak also to Amendments Nos. 119 and 121 and 124 to 128. These amendments concern patient confidentiality.
Amendments Nos. 118 and 124 are designed to ensure that deceased persons and patients no longer in contact with their doctor have the same rights to confidentiality over their medical records as do individuals who are still alive.
Amendment No. 120 is designed to ensure that even if an individual cannot be traced their confidentiality should be protected. We believe that CHIMP should not be able to name individuals in its reports or disclose their details until 30 years after the recorded death of an individual. It is odd that the commission is able to make public details of patients without any hindrance immediately after their death. Publication of details, especially relating to the recently deceased, can cause distress to relatives and friends. Moreover, they would have no say as to whether such details can be made public because CHIMP has, or may have, absolute privilege in respect of what it says. They would have no recourse to law if damaging or otherwise incorrect details were made available about relatives who had recently died. We feel that a reasonable period of time should elapse before disclosure.
I am sure the Committee will agree that personal health information is collected for the provision of care to individual patients and generally should not be used for other purposes without the patient's permission. Only where there are exceptional circumstances may information be used without consent—for example, where disclosure is essential to avoid a risk of death or serious harm to people and it is not possible to obtain consent.
The grounds for disclosure must be of sufficient severity to justify a breach of the duty of confidentiality. That duty of confidentiality extends to all patients and endures beyond their death. The law relating to statutory rights of access prohibits doctors from disclosing information which patients gave on the understanding that it would remain confidential. As with living patients, this confidentiality may be breached only where it is essential to protect the vital interests of others.
Amendments Nos. 119 and 121 seek to provide a better safeguard against the identification of patients from documentation or information that is available to the commission. If the standard is simply that an individual cannot be identified from the documentation or information alone, that is a major cause of concern. The amendments seek to raise the level of protection of the patient's identity akin to that set out in the Data Protection Act 1998. Amendments Nos. 127 and 128 seek to raise the standard of reasons for disclosure to the same splendid standards as those issued by the General Medical Council. I beg to move.
Lord Walton of Detchant: I very warmly support these amendments, although I have minor reservations about whether it is necessary to place on the face of the Bill a specific time limit upon the disclosure of such information. During my presidency of the General Medical Council many years ago a spirited debate took place on the whole question of whether it was ever proper for a medical historian in writing a book or paper to disclose information about an individual who had died some time ago. That issue was highlighted by a book review published in a prestigious medical journal. Information in an anonymous review had made it clear that the author of the review had known the public figure who was the subject of the book being reviewed and had in consequence disclosed some quite disturbing confidential medical information. That had raised a great deal of anxiety. The GMC stated very clearly that in the doctor's duty of confidentiality to his or her patient the death of the patient did not absolve the practitioner from that responsibility. Hence, I believe it to be very important that this issue should be clarified. For that reason I warmly support the amendments.
I am disappointed to learn that the Government have decided that CHIMP should not apply to the independent private health sector. The Registered Homes Act 1984 covers a number of independent hospitals but not a very large number of private hospitals that now provide a wide range of acute care. At Second Reading I expressed concern about the fact that there was no legal protection at the moment, at least not in statute, against an individual working as a non-clinical member of staff in a private healthcare organisation disclosing confidential information about a patient. The noble Baroness was kind enough to write to me in detail about this issue. She indicated that not only were such staff subject to a statutory duty, as under the Data Protection Act 1998, to respect the confidentiality of information, but that they would also have a personal common law duty of confidence to both patients and their employers.
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However, the BMA remained concerned in that it believed that common law protection was not enough. The commission and its staff must comply with these duties. On the rare occasions on which CHIMP required access to confidential patient information this would occur only in limited circumstances. CHIMP would be able to access such information only with consent and that would be looked at by a clinical member of the CHIMP review or investigative team. I was reassured to learn from the noble Baroness that the Government proposed to introduce a new criminal offence relating to the unauthorised disclosure of confidential information by the commission, its staff or those working with the commission in the exercise of its functions. But I pose the following question: does that proposal cover individuals who may in the past have worked for the commission or, for example, a private healthcare organisation? Does the duty of confidentiality persist even after that individual is no longer employed by the commission or that other health body?
7.15 p.m.
Lord Clement-Jones: I rise to speak to Amendment No. 126, which is part of this grouping. However, I have considerable sympathy with the other amendments in the group. In particular, I believe that we must listen with care to the observations of the noble Lord, Lord Walton, about this matter not being four square with the way in which clinicians currently believe their duties of confidentiality must he exercised. Can the Minister say what consultations have taken place with the medical profession on the provisions of this clause? Clearly, this is a matter of considerable importance. Amendment No. 126 itself arises out of concerns on the part of the medical profession. Although previously, under the Police Act, the medical profession was entitled to disclose information only when a serious criminal offence had been committed, we now find that under the provisions of this Bill the word "serious" has been deleted. The secondary legislation under the Police Act drew attention to the special sensitivities of medical confidentiality. Certainly, those representatives of the medical profession who have made representations to me do not wish to see the confidentiality of information exchanged between a patient and doctor compromised. How is this provision to be exercised? More generally, is there any way in which we can beat out a common set of provisions on confidentiality with which clinicians can be perfectly happy and which the Government find acceptable?
Baroness Hayman: This set of amendments and the debate upon it rightly highlights a very important issue regarding the confidentiality of information relating to individuals and the intention to protect that wherever possible. We intend and expect that information that is produced by the commission should, wherever possible, be in a form that protects the identity of the individual. The intention is that the circumstances in which information that identifies an individual is obtained without consent are kept to the absolute minimum necessary to ensure that the commission is able to fulfil

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its functions with access to essential information subject to necessary safeguards. It is a difficult balance to strike and it is important that we get it right.
I turn to the specific areas of concern that have been raised in the debate. As to Amendments Nos. 119 and 121 relating to the anonymising of data, the Government expect confidential information to be produced in the form in which the identity of the individual cannot be ascertained wherever possible. Where the relevant document or information is produced in such a form the existing provisions under Clauses 16(2)(a) and 17(3)(a) allow for the obtaining or disclosure of such information. Where information is obtained or disclosed under these provisions the intention is that the documents or information should be anonymised or produced in a statistical or summary format so as to protect the identity of the individual concerned. We do not intend that the information should be in a form that enables the commission to identify the individual using other information already in its possession. That is the concern to which Amendments Nos. 119 and 121 are addressed.
If access to such information, put together with other information held by the commission, could enable the commission to identify an individual clearly it would not be in a form in which the identity of the individual could not be ascertained. The disclosure would therefore not fall within those permitted by Clause 16(2)(a).
We believe that the existing provision largely achieves the result intended by this amendment and recognises the issue to which the noble Lord, Lord McColl, drew attention. The effect of the amendment would be to insert an explicit test on the face of the Bill. It will be the person or body who holds the relevant information who must anonymise or otherwise ensure that the information is in a form that protects the identity of the individual. The holders of the information may not be aware of exactly what information is in the hands of the commission. It would be even more difficult for them to assess with certainty what information the commission is likely to obtain in the future. We are concerned therefore that the amendment as phrased will impose too heavy a burden on the holders of confidential documents as it will require them to make a difficult judgment about what might be ascertained from their information when placed together with material outside their control.
The Bill includes scope to make regulations imposing any further safeguards that may be necessary. The safeguards on the face of the Bill are not necessarily the only safeguards. I should be happy to consider further the case for regulations on that point within the appropriate framework that I think the Bill sets.
Important points have been raised. I should like to take away for greater consideration the question of how we ensure that the identity of individuals is protected further. Clauses 16 and 17 set out limited circumstances where the commission will be able to obtain or disclose information which has not been put in the form in which the identity of an individual cannot be ascertained. In particular, we have had a debate about information
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relating to a deceased person which is covered in Amendments Nos. 118, 124 and 125, or untraceable people, in Amendment No. 120.
If the safeguards in Clauses 16 and 17 on disclosure of information on living individuals were extended to deceased people as proposed in the amendments, the commission would be able to obtain such confidential unanonymised information only in the limited cases where consent to release of the information was not required. Similarly, if Clause 16(2)(c) were removed, the commission could not obtain information about an untraceable individual other than in these circumstances.
It may be helpful if I refer in more detail to the protection of information about deceased people since the legal position here is complex. We believe that the amendment would seem to go beyond existing law in this area. The application of the common law of confidentiality to deceased individuals is not altogether clear. But what seems clear is that no one has a legal right to give consent on behalf of a deceased individual to the release of information about him although the individual's personal representatives may have certain other rights. For example, they are able to sue in respect of rights that have passed into the estate of the deceased individual—for example, rights in relation to land and other property.
In the absence of anyone legally able to consent, the statutory restriction proposed by the amendment would unnecessarily restrict the commission's ability to disclose information where it thought it necessary or appropriate to do so. Perhaps I can give some examples of the kind of circumstances in which that would be a worrying constraint. If the commission, when conducting an investigation, considered it a threat to the health and safety of patients, it would be able to obtain the information under provisions in Clause 16(2)(d). However, it might not always be immediately apparent without further investigation that the quality of services provided by a particular organisation constituted a threat to the health and safety of patients. In those cases, where confidential information might provide clear evidence to support various concerns about the quality of care provided by a service, the commission might wish to obtain that information. The health and safety of others could be at risk if that information was not obtained. The commission might also feel that it needed to disclose the information to an appropriate person such as the relevant regulatory body. The proposed amendments would stand in the way. While it would be wrong, I believe, to prohibit the commission accessing the information in those special circumstances, I recognise the sensitivities and importance of proceeding with due care, paying particular regard to the concerns of the relatives of the individual concerned. The noble Lord, Lord Walton of Detchant, made clear why we should take these issues seriously.
On safeguards regarding untraceable people, where it appears that an individual cannot be traced the commission would need to ensure that all reasonable efforts had been made to trace them. The commission would work closely with the organisation concerned in the attempt to ascertain the patient's whereabouts in order to obtain consent. As regards deceased people it

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is a difficult and sensitive area, as we have said, and it is appropriate for safeguards to be put in place. I should like to consider what further safeguards might be imposed by regulations under Clause 16(1) concerning the commission's access to the information or directions given under Clause 15(4). In addition, we expect that the commission will draw up appropriate guidelines for the obtaining of disclosure of confidential information about deceased patients, including any arrangements for obtaining the consent of relatives.
Perhaps I may reply to the specific question from the noble Lord, Lord Walton of Detchant, as to the persistence and duty of confidence even when an employee is no longer in the employment of the institution, the commission, involved. Yes, indeed, Clause 17(2) applies to any person who knowingly or recklessly contravenes that subsection. It would include past as well as present employees of the commission.
I turn now to Amendments Nos. 126, 127 and 128 which cover circumstances in which confidential information relating to an individual could be obtained or disclosed. First, I give the overall reassurance that such information would be released only when it was in the public interest so to do. In connection with a criminal offence—Amendment No. 126 deals with that—under Clause 17(5)(e) the commission will be able to disclose information,
"in connection with the investigation of any criminal offence triable in the United Kingdom".
We would want the commission to be able to disclose such information if it could facilitate a criminal investigation and if it were considered that this would be in the best public interest.
The proposed amendment would allow such information to be disclosed only in connection with investigation of a serious triable offence. The difficulty is to categorise exactly what would be serious in this context. I suggest that perhaps it is wise not to be drawn into the attempt. Such cases would be extremely rare and we would not want to put restrictions on the face of the Bill. Judgment on whether the public interest in maintaining the confidentiality of personal information is outweighed by the public interest in detecting and prosecuting crime is, I suggest, best made in the individual case. However, I should be happy to consider what further guidance or secondary legislation we might frame to cover those rare eventualities which might give some comfort to noble Lords who have been supporting the amendments.
I move to the situation where an individual is considered to be a threat to health and safety under Amendments Nos. 127 and 128. Clause 17(5)(h) allows the disclosure of information about an individual without consent where that same individual is likely to constitute a threat to the health and safety of individuals. Again, the information would be disclosed only to those to whom it was in the best public interest that it should be disclosed. For example, if in the course of an investigation the commission discovered that an individual health professional was threatening the health and safety of individuals, it would want to pass that information on to the employing organisation, or, if
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appropriate, the relevant regulatory body, for it to take appropriate action to prevent any further threat to individuals.
The amendments state that disclosure should be made only where there is a serious risk to individuals. Again we face the problems of definition. But I cannot accept that where the commission has clear evidence of a threat to health, falling short of death or serious harm, it should overlook it. The commission will have experienced clinicians on its team who will he able to decide whether there is such a risk to health and safety that information about an individual should be disclosed. I can tell the Committee that similar provisions also apply to the health service commissioner who is not limited to disclosure in cases where there is a risk of death or serious harm.
It may help the Committee if I add that we are satisfied that these provisions are consistent with the European Convention on Human Rights which concerns the right to respect for private life. The article provides that a public authority may not interfere with the right unless such interference is in accordance with the law and necessary in a democratic society in the interests of, among other things, public safety or for the protection of health. We consider the provisions in the Bill fall within that exception. I should like to make it clear that it is not the intention that the commission will name and shame individuals, but it must be able to pass information to the appropriate people or bodies when that is in the best public interest.
In discussion we have been carefully through the clauses. In phrasing them we have sought to strike the right balance between safeguarding patient confidentiality and allowing the commission to act in the best interests of patients and the public.
Some points were raised in respect of which we would wish to consider further safeguards either through regulations or guidance. I hope that the Committee will consider that that will correct any imbalance it feels exists on the face of the Bill and I hope that the noble Lord will feel able to withdraw his amendment.
Lord Walton of Detchant: In respect of one provision which the Minister said she would reconsider, it might be helpful to consider the exact wording of the advice given to the medical profession in 1984 following the passage of the Police and Criminal Evidence Bill. It was that it was proper for a doctor to breach confidentiality in order to assist the police in the investigation of a grave or very serious crime.
Baroness Carnegy of Lour: The Minister made one point which I cannot accept, but I am grateful that she will reconsider the matter. As regards Amendment No. 118, which refers to deceased people, she said that no-one has the right to give consent on behalf of a deceased person. All right, but we did not previously have the commission with its draconian powers and she must consider how that will affect the position of the relatives of deceased people.

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I believe that 30 years, which my noble friend thought would be a suitable period after which someone might be named, is very short. I think of one of my parents who died 30 years ago and know that I would intensely dislike her name to be produced in such circumstances. This is not a matter of balance; it is a moral judgment. I suggest that the Government should be very careful about it.
Lord Clement-Jones: I thank the Minister for that extremely careful reply. We on these Benches will wish to consider it and digest it further. However, it confirms the need for consultation with the medical profession. We cannot have a situation in which doctors and others involved in healthcare are obliged to disclose information which is against their code of professional ethics. The noble Lord, Lord Walton, said that previous definitions have been found. I am sure that with the noble and learned Lord the Lord Chancellor present in the Committee we could easily find a definition of a serious crime in a matter of minutes and amend the Bill forthwith. The fact is that there has been a previous definition with which the medical profession were happy. I urge the Minister to meet representatives of the profession between now and the Report stage not only in respect of Amendment No. 126 but the other serious points made during the debate. The length of her reply showed the seriousness with which she took those points and I thank her.
She mentioned certain safeguards; for example, that disclosure would take place only when it was in the public interest. That is a wide interpretation and could butt up against professional ethics. I believe that consultation with the medical profession could bear fruit on this most important issue in the Bill.
Lord Lucas: In my experience, the seriousness of a crime is defined by the length of the sentence which can be given for it. I see crimes separated into serious and less serious in other legislation and I am surprised that the department does not. Perhaps if it looked at the legislation of other departments it might find it such a definition.
I am concerned with Amendments Nos. 127 and 128. The Minister appeared to be saying that any individual with a venereal disease, however insignificant in terms of the risk to life or longevity of the person to whom it is passed on, would have no protection under the Bill as drafted; because of necessity they posed a risk to the health of other people that information could be divulged. I believe that that would be an undesirable change in the law.
Lord McColl of Dulwich: I, too, thank the Minister for her thorough and careful reply. I was encouraged because she gave the impression that there would be a lot of discussion about the provision and perhaps some rephrasing. It is looser than the regulations of the General Medical Council, in particular with reference to Amendments Nos. 127 and 128, and it would be much
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better if it were tightened up. I thank her again for her thorough reply and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
7.35 p.m.
Lord Hunt of Kings Heath: I beg to move that the House do now resume. In moving the Motion, I suggest that the Committee stage begins again not before 8.35 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Judicial Appointments
Lord Patten Lord Patten rose to ask Her Majesty's Government what steps they intend to take to ensure greater openness in the appointment of the judiciary, particularly in the light of recent legislation increasing the constitutional role of the judiciary.
The noble Lord said: My Lords, I ask the Question standing in my name on the Order Paper because I believe that the way in which the judiciary are selected is in urgent need of modernisation. I do not ask the Question from the point of view of someone who perhaps is known as a raving radical. Nor do I have any interests to declare, as I have no legal qualification or occupation. Therefore, I hope that no one in your Lordships' House will think it impertinent for someone not learned in the law to introduce a debate about the way in which the judiciary are selected—though I suspect that I have caught some whiff of that feeling in the corridors of this place. However, I would maintain to your Lordships who may be sceptical about my locus, let alone my ability, to raise such issues that such are the revolutionary changes sweeping through the judiciary in the United Kingdom as a whole that it is of vital importance that they are urgently considered outside the judicial magic circle.
I have four reasons to put to your Lordships to explain why I am so uneasy about the way in which our judiciary are appointed in relation to their ever-growing powers. I then have four entirely I hope helpful and constructive suggestions to make as to how improvements might be made.
First, because of their ever-growing powers, we need greater openness about the way in which our judges, and in particular Lords of Appeal in Ordinary, are selected. Let us take the way in which judicial review has developed in this country. When I joined the then Administration for the first time as the most junior of junior Northern Ireland Office Ministers in 1981, judicial review was barely heard of so far as government decisions were concerned. As a government old lag hardened in the corridors of Whitehall and case hardened in the Committee rooms of another place, I do not happen to think that judicial review is bad. But its increasing use is altering the balance of powers in our constitutional arrangements.
Secondly, when the substantive provisions of the Human Rights Act come into force, we shall, in developing the common law compatibly with the rights contained in the European Convention on Human Rights, be facing a legal revolution in this country. This is because for the first time in our history our rights as subjects or citizens will be spelt out in law, leading to an ever greater burst of judicial activity and a further extension of judicial power.
The third reason for my concern is the magical mystery tour approach to constitutional change thus far adopted by Her Majesty's Government. Because of that approach, not knowing where we are going, we are left with a vacuum which will draw the judges inevitably more and more into arbitrating between the United Kingdom Parliament here in Westminster and perhaps the Scottish Parliament and the Welsh Assembly. That may not be the Government's intention, but arbitrating over a whole range of issues between the countries will increasingly become the role of the highest court in the land for the simple reason that there is no one else to do the job. Thus the Appellate Committee of your Lordships' House is at risk of becoming a de facto constitutional court.
The noble and learned Lord the Lord Chancellor told me on 3rd February of this year that he has no proposals at all to develop such a constitutional court. But it is about to develop in front of our eyes. Equally, the Lord Privy Seal told me on 1st February that the Government will not set up any mechanism to monitor the effects of constitutional change in this country. She said that they will not set up a permanent Royal Commission or any similar body to monitor and report on the effects of constitutional change upon the United Kingdom. Effectively, the members of the higher judiciary will have to arrogate more and more constitutional powers to themselves as we go further on the magical mystery tour of constitutional change that the Government are introducing.
Fourthly, greater openness is necessary because of the greater judicial activism that we see now. More and more judges arrogate to themselves jurisdiction over moral matters in line with how they, not Parliament, see international law developing. That may or may not be a good thing. Certainly, in the past, under common law, judges have always had the ability to avoid parliamentary influence. But that has rarely been a matter of public concern as regards constitutional matters because of the usually conservative—and I do not use that word in a political or pejorative sense—way in which powers are exercised and the personally cautious approach of the Law Lords and others which has ensured that the tide of change has flowed slowly and in an evolutionary way.
But I believe that we are in grave danger of having a group of people in this country who will become over-mighty citizens. We need more checks and balances to ensure that our ever more powerful judges are scrutinised more closely as their role grows.
We should start with how they are appointed. That is the best way to start. I do not approve of root and branch reform in that area but we should begin by
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understanding more about how our higher judiciary are appointed. I have four proposals to put before your Lordships in order to suggest how the modernisation of the process of selection of the judiciary might begin.
The first of these suggestions is that all posts at the highest levels need to be advertised in order to show openness to appointment to women as well as to men. Secondly, there should be an annually updated and mandatory register of interests that is publicly available for all Lords of Appeal in Ordinary, Heads of Divisions and Lords Justices of Appeal. It is now in the public interest to know more about our judicial masters. If that is not in the public interest, perhaps the noble and learned Lord the Lord Chancellor will be good enough to explain why not when he addresses us later on.
Thirdly, there should be a powerful lay element involving those drawn from outside the law helping with the selection of judges. At the moment, the way in which this Lord Chancellor and earlier Lord Chancellors have conducted the appointments procedure through the consultation process with senior members of the judiciary is no longer fit for the purpose. Indeed, it may well remind some of your Lordships of the way in which the leaders of my own political Conservative Party were selected until 1964; that is, by what was known as the magic circle approach to appointments.
I recognise of course that lay people are already involved in the shortlisting and interviewing of applicants for judicial office below High Court level, which was a welcome introduction by my noble and learned friend Lord Mackay of Clashfern. I believe that that should be extended urgently.
Fourthly and lastly, so important is the role of our higher judiciary becoming and so powerful are its members growing that there should be public hearings before a Select Committee of both Houses of Parliament before any man or woman is appointed to become a Lord of Appeal in Ordinary. I have friends in the law. Indeed, one or two members of the higher judiciary have even visited my house, though I shall not ruin their careers by naming them. But many in the judiciary seem to be in an absolute state of denial as regards the fact that, of necessity—it is not their fault—the members of the higher judiciary have become more political. Yet, as things stand, their role in both promoting and monitoring constitutional change will be absolutely unfettered.
I make no comment on the lack of separation of powers which exists, uniquely in this place, other than to remind your Lordships that, when our Government published their White Paper on the future of the House of Lords on 21st January, they admitted that the Law Lords' membership of this House was an anomaly. In the long term, I expect that we shall no longer have the Lords of Appeal in Ordinary sitting in this Chamber: sitting both as members of our highest court and as legislators; not only administering the law but making it; deciding cases and voting on legislation. That lack of impartiality is automatically built into their role through no fault of their own but I believe that it flies in the face of Article 6 of the European Convention on Human Rights, which states that people are entitled to an

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independent and totally impartial hearing. Their very judicial activism has brought into focus their position as Members of this House and has hastened their ultimate demise.
I say in conclusion that I do not for one moment criticise the hard work, legal expertise or personal integrity of any Lord of Appeal in Ordinary, past or present. I merely say that the world has changed and that, without urgent attention, their constitutional role will become uniquely strong, unfettered and unscrutinised anywhere in the world. We should not allow that to happen and we should not allow the checks and balances in our arrangements to become so distorted.
7.45 p.m.
Lord Borrie: My Lords, the noble Lord, Lord Patten, has done the House a service by raising this Question for us this evening. I am well aware, as is the noble Lord, that some light has been shed upon the system of judicial appointments in recent years. I exemplify that by the Lord Chancellor's Department's evidence to the Home Affairs Select Committee of the House of Commons in 1995. Dr. Robert Stevens, a Master of Pembroke College, Oxford, wrote a book five years ago entitled The Independence of the Judiciary which included the fruits of research into the files of the Lord Chancellor's Department, which disclosed the fascinating and blunt comments of successive Permanent Secretaries and Lord Chancellors on the merits and demerits of various candidates for high judicial office. Sadly, the 30-year rule prevented Dr. Stevens from dealing with matters more recently than 1971.
The only Members of this House who really know how the system works are the present Lord Chancellor and any former Lord Chancellors. Nevertheless, despite having some concerns about the lack of transparency in the present system, I also have doubts about changing to a system which is sometimes referred to as a system whereby there would he an independent judicial commission either making the appointments or being the key significant advisory body for the Lord Chancellor. I should be concerned in relation to such a change about the inevitable diffusion of responsibility for appointments.
Then there is the question of how such a body would itself be appointed and what sort of people should be on it. To my mind, the key question for us all is whether a change would be likely to bring about better appointments. A committee or commission of diverse interests may well tend to go in most cases for the compromise candidate—the person who has the least opposition, the "safe pair of hands".
In debate in this House on 17th February, the noble Lord, Lord Kingsland, suggested that a candidate for judicial appointment selected by the Lord Chancellor should be interviewed by a parliamentary committee. The noble Lord, Lord Patten, seems to have a similar idea. I do not know whether that is becoming agreed Tory party policy or whether it is a piece of policy being
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developed, as it were, on the hoof by the noble Lord, Lord Kingsland. Perhaps we shall hear more about that this evening.
I suggest that informal, confidential conversations and contacts with a lay element, perhaps, as the noble Lord, Lord Patten. suggests, may reveal much more information about judicial abilities and qualities than some more formal process or indeed, a process which involves political point-scoring in which Members of the House of Commons—as the noble Lord, Lord Patten, may recall from his days there—may indulge. The most important questions about judicial appointments concern the qualities we need in our judges and whether we should broaden the still narrow base from which they are drawn. The great American judge, Felix Frankfurter, said that a good judge needs to have three qualities, each of which is disinterestedness.
If I can be slightly less laconic than the late judge, perhaps I may elaborate and say that some qualities are universally required of all judges and some are particularly desirable for judges sitting in specific kinds of courts or tribunals. Those universal qualities, I suggest, include integrity, independence, compassion, patience, humility and a strength of personality that makes him or her capable of withstanding pressures of any sort, from anywhere, including government.
It has never been obvious to me or apparently to such observers as David Pannick, QC, who writes regularly in The Times or Sir Louis Blom-Cooper, QC, as to why a practising barrister who will have spent half a lifetime in fierce partisanship in the courts is deemed to have the best qualifications for being an impartial judge. As we know, the choice has been widened somewhat recently to include solicitors, but so far the Lord Chancellor's office has been extremely cautious, no doubt because it is considered that practice in the courts is virtually demanded and not many solicitors fulfil that requirement.
Can we broaden the base from which judges of various levels are chosen to include chairmen of administrative tribunals, academic lawyers and lawyers from industry and commerce so that a wider choice is available? Let such lawyers be given part-time judicial appointments so that they can experience judicial work and have their performance monitored. After all, that is the typical route of judicial work for practising barristers. I believe that it could be made more widely available to others.
7.51 p.m.
Lord Neill of Bladen: My Lords, I too am grateful to the noble Lord, Lord Patten, for raising this issue. But I am a sceptic, both as to the perceived mischief and as to the suggested remedy. We take too narrow a historical view. If we look back across the centuries we will see that the law and judges have been frequently involved in cases of the highest constitutional importance. I have only six minutes at my disposal and therefore will not go into the legal history, but let me mention some salient cases with which we will all be familiar.
The first is the case of the five knights in the time of King Charles. They were imprisoned for not paying an illegal demand for a forced loan. The response to habeas

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corpus was, "The King has imprisoned them". A craven court had that highly political decision to make and decided to leave the knights languishing in gaol. A little later, at the beginning of the 18th century, we come to Ashby v. White, a tremendously important constitutional case where it was held that a person who was denied the right to vote in a parliamentary election had a right of action in damages. That led to rioting in the streets of London. Queen Anne suspended both Houses and, perhaps more worrying for the legal profession, officers were sent from the other place to arrest a barrister in the Temple for having appeared on the wrong side. He was well prepared with sheets and ropes and, while they were knocking down the front door, he climbed out of the window at the back. That case led to days of rioting.
Later in the century we had Somerset's case about the slave—a tremendously important constitutional case. In the 19th century, take your pick: Stockdale v. Hansard and the Taff Vale trade union cases. In the 20th century there are too many cases to choose. Constitutional issues have arisen frequently. We should not lose sight of the Privy Council. It has been deciding cases of high constitutional importance down the years. For example, in 1930 Lord Atkin was responsible for giving the leading advice in a series of important Canadian appeals on its constitution; similarly Australia. Since the war we have moulded constitutions for Commonwealth countries and those have given rise to many important cases which have come to the Privy Council. So the highest judges have been regularly dealing with cases of high constitutional importance.
The noble Lord, Lord Patten, is correct in referring to judicial review. Of course there have been a torrent of cases of the highest importance. But the judges have become used to dealing with this jurisdiction and, whereas in the old days, it used to be said theoretically that one might set aside a decision of a Minister on the ground that no reasonable Minister could reach such a decision, today—not every day, but frequently—judges set aside Ministers' decisions on precisely those grounds, and the decisions of lesser tribunals and other bodies.
So there is a great experience among the judges in handling difficult cases involving conflict between the Executive and the rights of the citizen. Indeed, I would claim that the judges had stood between the Executive and the rights of the citizen and held the hand of the Executive when these were applied in an oppressive manner in many instances. A famous example crossing the centuries is the attitude of the courts to the so-called "ouster" clause. That is a provision in a Bill which says that no issue arising on such-and-such a question can ever be raised in any court of law. Judges with infinite skill have found methods of interpretation to completely disarm the exercise of such ouster clauses, again, upholding the liberty of the subject.
I believe that there is an exaggeration in saying that we are dealing with a novel problem. We do not meet people going round saying that judges have been mishandling cases of judicial review; on the contrary, we hear praise for the independence and courage of the judiciary in performing their traditional role.
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As to the supposed remedy, the noble Lord suggested four. One, for example, was to advertise all the appointments. There would not be much harm in that if we said that such-and-such a Law Lord is due to retire in two years' time. We could certainly do that. But the register of interests is an entirely separate point and has nothing to do with the appointment of the judiciary. I have views on that and believe that there is an anomaly about the register of interests. I do not understand, if one is taking that point, why it is confined simply to the judicial Members of the House of Lords and not to other courts. I see no reason why we should not know the interests of a much lesser judge than somebody sitting in the House of Lords. How that would be dealt with would involve difficulty in maintaining a register.
I suggest that we would not gain by what is essentially the noble Lord's key proposal; that is, that we have a judicial appointments board manned by the great and the good with a strong lay element. Worst of all, in my view, is the public hearing element to that proposal. What are the unfortunate candidates going to be asked? If they had any sense they would never have written a word in any legal article so that they would have no recorded opinion of any sort. Will they be asked questions of law? How will it be decided? For instance, before the decision relating to life support machines had been decided, they may have been asked, "Would you be in favour of turning off a life support machine in certain circumstances?". The questions could involve issues of abortion or any other controversial issue of the day. Will a potential judge be asked to give an opinion?
If the candidate had any sense he would say, "If this came before me judicially, I would want to consider the arguments on both sides. Sitting here, I have no opinion". But of course that would not do, so presumably he would have to give an opinion. I suppose a candidate could be failed for expressing the wrong opinion. That is a disastrous way of appointing the judiciary. We can carry openness to its full length—I believe that openness is one of the great seven principles of public life; I proclaim that—but there must be limits to it. The limit comes when we try to interrogate potential judges, possibly throw open their record, their CV and the references that have been submitted about them. I am therefore a sceptic on both counts.
7.58 p.m.
Lord Mackay of Drumadoon: My Lords, my noble friend Lord Patten is to be congratulated on asking the Question which gives rise to this short debate at a time when the judiciary of the United Kingdom is preparing to take up its new responsibilities under the devolution legislation. I know that members of the judiciary are looking forward to those new responsibilities and are preparing thoroughly for them. They are responsibilities which will involve ensuring that the devolved institutions respect convention rights as those rights have been defined under the Human Rights Act 1998.
The speech of my noble friend Lord Patten was primarily directed to the appointment of members of the judiciary in England and Wales and of Lords of Appeal

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in Ordinary. That is entirely understandable in view of the fact that it falls to the noble and learned Lord the Lord Chancellor to reply to this short debate.
Perhaps I may say, at the outset, that I agree with a great deal of what my noble friend had to say. However, like the noble Lord, Lord Borrie, and the noble and learned Lord, Lord Neill, I share some reservations about the role of public hearings in the appointment of judges. Although I had the benefit of hearing the speech made by my noble friend Lord Kingsland, like a number of other Members of your Lordships' House I remain to be persuaded.
Notwithstanding the coming into force of the Government of Wales Act and the Northern Ireland legislation, the appointment of judges who will sit in those parts of the United Kingdom will remain the responsibility of the United Kingdom Government. By contrast, after devolution, the appointment of members of the Scottish judiciary—with two important exceptions, the Lord President and the Lord Justice Clerk—will be matters for the First Minister who will, of course, be answerable to the Scottish Parliament.
The provisions of the Scotland Act, as enacted, will ensure that to some extent different procedures are followed than have been applied up until now. Notwithstanding the imminence of devolution, it would be wrong to comment in detail during the course of this debate on what form procedures in Scotland might follow. Those are clearly matters for the Scottish Parliament, which I have no doubt will follow the principle of openness which lies behind my noble friend's Unstarred Question.
Occasionally in debates on legal matters in your Lordships' House, I have been guilty of suggesting that the English legal system would do well to follow the Scottish example. In my own defence, I might say that I suspect I am not the only Member of your Lordships' House, qualified in the law of Scotland, who has sinned in that way. I seek forgiveness for past failings. However, the noble and learned Lord the Lord Chancellor will be happy to learn that I make no such suggestion tonight as regards the appointment of judges.
The noble Lord, Lord Borrie, mentioned the report of the Select Committee on Home Affairs of another place which was published back in 1995. As he correctly stated, the Lord Chancellor's Department submitted very detailed evidence to that committee which was published when it came to report to another place. From a reading of that report, and also from a briefing which I received from officials in the Lord Chancellor's Department when I was Lord Advocate, it is quite clear to me that a considerable amount of care and effort is taken by such officials in the gathering together, vouching and assessing of information upon which the Lord Chancellor, in due course, makes appointments at various levels to the judiciary.
I have seen some of the forms used in that exercise. Quite frankly, I have been most impressed by the rigour with which detailed information is sought from a variety of sources, cross-checked and analysed. I am aware also that the Lord Chancellor's Department publishes leaflets that explain the qualities looked for when appointments
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are made at different levels of the judiciary and how those appointments are made. In publishing such leaflets, it seems to me that the Lord Chancellor's Department has set a good example. I, for my part, rather regret that in the time when I held office as Lord Advocate, I was unable to persuade colleagues and officials to do likewise.
There is, however, one suggestion I would make which might address one aspect of the public concern which lies behind my noble friend's Unstarred Question. What interested members of the public may currently lack is ready access to factual knowledge as to who the members of the judiciary are; what qualifications they hold; details of the career they followed prior to appointment; details of their areas of particular expertise; and details of their involvement in other aspects of public life.
If they had such information, I believe it would not only serve to inform members of the public who the judges are, but also reassure them that the judiciary is constituted of individuals of the necessary education, ability and experience, drawn from a wide variety of backgrounds and able to discharge the increasingly important role that the judiciary has as the Government's constitutional legislation is brought into force.
As the noble and learned Lord the Lord Chancellor may well be aware, last week the Scottish courts service launched its own website on the Internet. The objectives of doing so include providing members of the public with information about the role of the courts and the decisions of various judges. In particular, it carries details of who all the High Court judges are, together with some detail of their qualifications and experience. I know that in this instance the Scottish legal system is following the example of England. As I understand it, the court service in England and Wales has had a website for some time. I endeavoured to search the website; I can find no information about the judiciary. Perhaps I may put forward a suggestion. If the website contained details of procedures currently followed, the qualities sought, and the rigorous steps taken to collect information and, more importantly, details of who the judiciary are, that might in some way, albeit indirectly, seek to meet the desire on the part of many Members of Parliament, lawyers and members of the public for greater openness in the appointment of the judiciary.
8.5 p.m.
Lord Clinton-Davis: My Lords, I have an interest to declare at once. In 1984 I was appointed an assistant recorder. However, as I went to Brussels as a commissioner instead, I never sat as an assistant recorder. That, I am sure, was to the benefit of everybody concerned.
There is one common theme here: we all praise the noble Lord, Lord Patten, for introducing the Unstarred Question. However, that is as far as the praise seems to go. I found that the criticism, or the indictment, he levelled was not made out. It was short of factual information and evidence. As the noble and learned Lord, Lord Neill, pointed out, most of the remedies were, I believe, seriously deficient.

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However, most of all the noble Lord seems not to have noticed the changes introduced by my noble and learned friend the Lord Chancellor and the further indications of change that he has already intimated. They seem to have passed him by. That is regrettable. However, I believe it is as well to say that my noble and learned friend has made it clear that the major criterion affecting his judgment about this issue is that appointments should be made on merit. Yes, there needs to be transparency, flexibility and efficiency in relation to the whole operation.
Under his tutelage, applications for appointment to the High Court Bench are being encouraged, wheras in the previous system invitation alone seemed to be the way in which this was done. Those who have undertaken career breaks for family reasons will be enabled to undertake part-time sittings. That is a radical and important change. Senior judges mentoring junior colleagues is something which he has also proposed. That will all be part and parcel of the new arrangements. He is proposing that there should be an annual report to Parliament about how the whole system of judicial appointments is operating.
There is, of course, the question of an ombudsman to investigate complaints of discrimination in terms of appointments of judges. My own hope is that that will happen. I shall listen with interest to what my noble and learned friend has to say about that. Perhaps he will also inform the House about his present thinking on a judicial appointments committee.
I believe that this Government have made an excellent start, which mirrors the thoughts of my noble and learned friend, who, along with my noble and learned friend Lord Archer and myself, is joint President of the Society of Labour Lawyers. He has been saying many of these things for years and writing about them. Now he has the opportunity to put them in place. Above all, he has set his face against discrimination. It is appropriate to talk about that in the context of the events of last week. Discrimination in the whole process of judicial appointments would be wholly intolerable.
My noble and learned friend has also acted against ageism. Assistant recorders can now be appointed up to the age of 53. The maximum age of appointment is no longer 50. Magistrates may be appointed up to the age of 65 to serve for a term. Reasons for non-selection are to be disclosed to the person affected, where requested.
My noble and learned friend cannot do everything himself. There is also a duty on those who encourage people to enter the profession to ensure that there is an absence of discrimination. The professions bear a big responsibility. One has to ask—indeed, my noble and learned friend has himself raised this—why there are no Asian or black High Court judges at present. I am confident that my noble and learned friend will investigate this issue. Indeed, my right honourable friend had something to say about that recently.
It is important that the youngsters who enter the legal profession should feel that they are not in any sense discriminated against, particularly if they come from the ethnic community or are women. It is important that they should have confidence in the profession because
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it is from them that the future judges will be selected. I believe that we have made considerable strides in relation to this. I am sure that there are some warts, but in the main the professions have acted responsibly.
Perhaps I may say a few words about the "magic circle" or "secret soundings". I really do not think that it is as malign a process as the noble Lord suggested. In fact, it is quite a sophisticated way of helping to measure suitability for judicial appointment. Of course, there is always the risk that the assessors could be biased, but, equally, my noble and learned friend is demanding a balanced assessment and is putting in place mechanisms to suppress any signs of discrimination in that regard. Consultation is not to be the sole consideration and every encouragement is to be given to people to apply to be considered as judges.
In conclusion, I think that my noble and learned friend has demonstrated his commitment on this issue. I say that although I have not always admired everything that he has done and have been somewhat critical of a certain Bill now progressing through your Lordships' House. However, when one considers the situation that he inherited and that which he is seeking to develop, one sees that my noble and learned friend has every reason to be supported by this House, the legal profession and the public at large.
8.12 p.m.
Lord Thomas of Gresford: My Lords, I too am grateful to the noble Lord, Lord Patten, for raising this issue. He is right to call for greater openness in the appointment of the judiciary. I too declare an interest as a recorder and a deputy High Court judge.
I believe that the power of appointment should be taken from the Lord Chancellor while he retains his political role and should be vested in a commission comprising judicial figures, members of the Bar and of the solicitors' profession, and members of the public. That is what we left behind us in Hong Kong. That was the system that applied there under colonial rule and it has continued. I am reliably informed that the judicial appointments now made in Hong Kong are completely free of political influence in a highly sensitive situation. I am convinced that that is the way in which we should move forward in this country also.
The noble Lord, Lord Patten, referred to "judicial activism". In using that phrase, he echoed the views expressed fulsomely by Judge Robert Bork, the former Solicitor General of the United States, whose nomination by President Reagan for the Supreme Court was blocked by the Senate because of his conservative views. In the "First Things" symposium in November 1996, entitled "The End of Democracy? The Judicial Usurpation of Politics", Judge Bork suggested that,
"the most important moral, political, and cultural decisions affecting our lives are steadily being removed from democratic control".
His colleague, Charles Colson, said that the blame should be squarely placed on the,
"systematic usurpation of ultimate political power by the American judiciary".
The fear of judicial activism has American, right-wing conservative roots.

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The noble Lord, Lord Patten, referred to moral matters. The matters which particularly exercise right-wing conservative judges in the United States are decisions made by the federal courts and by the Supreme Court on subjects such as abortion, euthanasia, homosexuality and assisted suicide. Indeed, Ed Meese, the Attorney General under President Reagan. wrote recently:
"Judicial activism has harmed virtually every aspect of public policy in America".
It was his view that,
"Leftist politicians have accomplished much of their agenda in the past thirty years not through use of such democratic means as the electoral process or legislation, but instead through the use of the federal courts".
His recommendation—again, this was echoed by the noble Lord, Lord Patten—was,
"The Senate should use its confirmation authority to block the appointment of activist judges. This confirmation process in recent years has been relatively perfunctory. The Senate Judicial Committee should closely question each nominee for the federal bench to ascertain the candidate's understanding of the proper role of the judiciary".
Similarly, the House Majority Whip, Mr. DeLay, who is, of course, a Republican representative from Texas, told the Washington Times in November 1997:
"as part of our conservative efforts against judicial activism, we are going after judges".
That claim was responded to by Mr. Lee Cooper, the president of the American Bar Association, who said that,
"any federal judge threatened with this sort of partisan bashing might be tempted to act on matters not based on the applicable law; rather the standard might become the prevailing winds of political popularity. This is not the justice system the American people want or deserve. That is a partisan political circus".
Cries about judicial activism derive from right-wing judges in America and from academic writers who see a clash between what they believe to be the purposes of the founding fathers of the written constitution at the end of the 18th century and the way in which in modern conditions the judges of the federal courts interpret those provisions.
This country has a completely different judicial system. The noble Lord, Lord Patten, referred to judicial review. There is a misconception here: in judicial review proceedings, it is not the job of the judge to second-guess the Minister nor to take the decision which has been entrusted by Parliament to the Minister. In our system, judicial review curbs abuses by the Government and by public officials by using the power to declare the acts of public officials contrary to natural justice, ultra vires or completely unreasonable. The court's function is also to protect the politically powerless and to stand up for minority rights. The noble and learned Lord, Lord Neill of Bladen, emphasised that point and I agree entirely with him. The function of judicial review is not to supplant government decisions, but to control them in the interests of minorities. That point has to be understood.
I turn now to the implementation of the European Convention on Human Rights. Under the Human Rights Act, which has now come into force, we have not given
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the courts the power to strike down legislation that is incompatible with the covenant; we have given the courts the power to make findings which can bring the matter quickly back before Parliament for further consideration.
In relation to human rights, one should bear in mind that the whole purpose of a covenant of this kind and of the ICCPR (International Covenant on Civil and Political Rights) is to depoliticise fundamental rights. I quote the words of Supreme Court Justice Robert Jackson in 1943 in the case of West Virginia Board of Education v. Barnette, when he said:
"The very purpose of a Bill of Rights was to withdraw certain subjects from the vicissitudes of political controversy, to place them beyond the reach of majorities and officials and to establish them as legal principles to be applied by the courts. One's right to life, liberty and property, to free speech, a free press, freedom of worship and assembly, and other fundamental rights may not be submitted to vote; they depend on the outcome of no elections".
So the whole purpose of the covenant is to take it out of the political arena.
Baroness Farrington of Ribbleton: My Lords, I remind the noble Lord, with respect, that he is now two minutes over time.
Lord Thomas of Gresford: I am obliged. Finally, I should like to refer to the proposed role of the Judicial Committee of the Privy Council in interpreting the constitutions of the Scottish Parliament and the Welsh Assembly. I do not see political considerations coming into the matter; it is well within the compass of that judicial committee.
8.21 p.m.
Lord Kingsland: My Lords, with the noble Baroness in mind and being aware that I made a speech on a similar topic 10 days ago, I shall be very brief.
I congratulate the noble Lord, Lord Patten, on introducing this debate. I do not think that he intended in any way to criticise the noble and learned Lord the Lord Chancellor; I think rather that he was probing and asking the noble and learned Lord for his reaction to the quite dramatic constitutional changes that the Government have introduced over the past 18 months and whether he felt some changes were necessary to maintain the legitimacy and reputation of the judiciary.
I listened with great care to the excellent speech of the noble and learned Lord, Lord Neill, and I entirely agree with what he said about the decisions made by our judges down the centuries. Even in recent years, with the increase in the number of judicial review decisions, our judges have still retained their legitimacy by making sure that those decisions are couched in the language of interpreting the will of Parliament.
Now, things may change—because of two measures that the Government have introduced. The first is the incorporation of the European Convention on Human Rights and the second is the devolution of power to the Scottish Parliament. In the case of the European convention, the balance of power between the judiciary and the legislature has changed dramatically. The judges can now range over all our statute law, analyse it in the

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light of the convention and, if they find an incompatibility, declare it. Once that incompatibility is declared, Parliament is obliged to legislate. Hence the change in balance of power between these two crucial arms of our constitution. Judges can no longer disguise what they say in the language of the intention of Parliament; it will now be their decision.
Is there not at least a danger that the judges might be seen by the public as overturning the decisions of elected politicians and therefore be perceived in the same way as elected politicians? I hope that that will not happen and that the noble and learned Lord the Lord Chancellor is right in what he said 10 days ago. He felt that no change whatsoever was necessary in his approach to the appointment of the judiciary. So be it. I hope that he is right. I do not share his confidence. I trust that he will at least reflect on the implications of the incorporation of the convention in the way that I have explained.
In the same way, the judicial branch, through the Judicial Committee of the Privy Council, will have to make decisions about the validity of Acts of Parliament passed by the Scottish legislature. What will be the political implications of those Acts being struck down? Perhaps it will be treated by the electorate of Scotland in exactly the same way as our own electorate reacts to a judicial review decision of a United Kingdom court; but, then again, perhaps not.
Having regard to the dramatic constitutional changes that the Government have introduced over the last 18 months, ought we not at least to reflect on the implications for the judges who now bear such a heavy constitutional burden for our country, a burden they have never been asked to bear before?
I do not entirely agree with every suggestion made by my noble friend Lord Patten. For example, I take the view that the selection of judges should remain in the hands of the noble and learned Lord the Lord Chancellor. In response to what the noble Lord, Lord Desai, said 10 days ago, I suggested that some public hearing might form part of the selection of the members of the highest court in our land—not that I think Parliament ought to be able to decide the judges' appointment, but there should be some public airing. After all, the noble and learned Lords who sit on the Judicial Committee of your Lordships' House are allowed to speak in it freely; so why should there be such a strong objection to their answering questions posed by your Lordships' House in the course of the appointment procedure? However, I have noted that many noble Lords have been sceptical about that matter and I readily accept that there may be some other method which would be preferable.
The essential question for the noble and learned Lord to consider is whether or not the dramatic change in the powers of the judiciary ought to make him ask pertinent questions about whether the present system is sufficient to ensure their legitimacy into the future.
8.26 p.m.
The Lord Chancellor (Lord Irvine of Lairg): My Lords, I too am grateful to the noble Lord, Lord Patten,
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for initiating this evening's debate, but I did note the point, well made by the noble Lord, Lord Borrie, as to whether this new policy was being made on the hoof. There is a close link between the operation—and the integrity—of the judicial appointments system and the independence of the judiciary. The noble and learned Lord, Lord Bingham, in his 1996 inaugural Judicial Studies Board lecture on the independence of the judiciary, said:
"The key to the successful making of appointments must, I would suggest, lie in an assumption shared by appointer, appointee and the public at large that those appointed should be capable of discharging their judicial duties, so far as humanly possible, with impartiality. Impartiality and independence may not, even in this context, be synonyms, but there is a very close blood-tie between them".
I agree that judicial impartiality is linked to, though slightly different from, the concept of judicial independence. One of the major duties of my office is to ensure the maintenance of judicial independence. The two pillars of our system are judicial independence from any executive or other interference and the assurance that the judges are impartial in their own independent sphere.
Judicial impartiality requires the judges themselves to put their obligation of fidelity to law and compliance with their judicial oath above personal preference. Some claimed in the late 1970s that the Court of Appeal had been partial in a long line of trade union cases. The most authoritative insistence on judicial impartiality came from Lord Diplock in Duport v. Sirs in 1980. He insisted that it was the judges' duty to apply the statutes, however unpalatable and whatever their own perception of where the public interest lay. Just as they are entitled to independence in their own sphere, so the public must be able to take their impartiality for granted. I believe the standing of the judiciary today is such that the public does have complete confidence in its impartiality.
In this debate it is important to distinguish between two quite different propositions. The first, which has not been articulated during the debate, is that we should never have had a Human Rights Act because it will politicise our judiciary. The second is that now that we have a Human Rights Act we must have a different method of appointing the judiciary. The first proposition is, I believe, the position of the noble Lord, Lord Waddington—he is not in his place this evening—who has tabled a starred Question for Wednesday on the subject. The second, I rather think, is the position of the noble Lord, Lord Patten. I am persuaded by neither.
The first proposition is simply an attempt to renew a battle that is over. Parliament has legislated for the Human Rights Act. Nor is the second proposition sound. I see no reason why adjudicating on legislation that might be called "constitutional"—I have to say that I find the expression very imprecise—should require any change to the way that judges are appointed. The decisions that judges have made in their own independent sphere across the century have frequently been the judicial component in much wider political controversies. I do not see the development of judicial review, of the Human Rights Act or of the devolution settlement as marking any sea change in the nature of judicial decision-making.

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Under the Human Rights Act, the principle of parliamentary sovereignty is emphatically retained. The courts cannot strike down an Act of Parliament as incompatible with the convention. There will be very rare cases where they will declare an Act to be incompatible, but then it is for Parliament to determine what change to the statute is to be made. Under the devolution legislation the Judicial Committee of the Privy Council—not your Lordships' House in its judicial capacity—will have to determine vires issues affecting, for example, the Scottish Parliament, but that is nothing new in principle. The Judicial Committee has a long history as a constitutional Court of Appeal from the Commonwealth, to which the noble and learned Lord, Lord Neill of Bladen, referred, and vires issues of this kind are food and drink to the committee. So it is important not to get all of this out of proportion.
I repeat what I said in your Lordships' House on 17th February in the debate on the separation of powers, mentioned by the noble Lord, Lord Kingsland, and initiated by the noble Lord, Lord Lester of Herne Hill:
"Some who are critics of the Human Rights Act argue that it will have a tendency to politicise our higher judiciary. It is true that the Human Rights Act, when implemented, will throw up cases which could be described as politically controversial. But the law is no stranger to that over the centuries. Think of the landmark cases in civil liberties",
to which the noble and learned Lord, Lord Neill of Bladen, referred. I continued:
"Think of the development of the law in relation to trade unions and the development by Parliament of immunities for industrial action which were then interpreted by the judges in controversial ways. Think of Liversidge and Anderson in 1942, the Regulation I8B case, and Lord Atkin's historic dissent."—
indeed, there was an unholy row about that at the time. I went on to say:
"Think of the development of judicial review and of natural justice. Think of Brind, which excluded certain politicians from media appearances but allowed actors to stand in. Think of the cases about homosexuality in the Armed Forces. Think about whether the life support machine should he turned off. Think of every controversial decision in the criminal law".—[Official Report, 17/2/99; col. 735.]
The courts have never been far away from controversy. I firmly believe that the Human Rights Act may see a change in degree, but not in kind.
I turn now to judicial appointments. I appoint to judicial office—or, in the case of more senior appointments, recommend for appointment—only those who meet the statutory qualifications for the office concerned. Subject to those statutory requirements, I make appointments strictly on merit, as did my predecessors. My policy is to appoint, or recommend for appointment, those candidates who satisfy the statutory qualifications and who, in my opinion, best meet the criteria for appointment. This is without regard to factors such as gender, ethnic origin, marital status or disability. The politics of any individual is absolutely irrelevant. I do not know, and would not contemplate inquiring, about the politics of any applicant for judicial office. I am sure that my noble and learned predecessors would say the same.
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I believe strongly in equal opportunities. Everyone should be given an equal opportunity to fulfil his or her personal potential. Negative discrimination on the grounds of gender, race, religion, sexual orientation, class or any other discriminatory factor should never be tolerated. But, as I have said before, I am resolutely opposed to any proposition—and we have heard it tonight—that our senior judiciary, prior to appointment, should be subject to public hearings, to subject their judicial track records or attitudes to appraisal in terms of changing fashions for political correctness. I do not think that our higher courts should be sculpted to conform to some notion of social, political, gender, or any other balance. So I fundamentally disagree with the noble Lord, Lord Patten, that there should be public hearings before a Select Committee of both Houses of Parliament to approve the appointment or to investigate the attitudes of independent and impartial lawyers who might be appointed Law Lords. I entirely agree with the noble and learned Lord, Lord Neill of Bladen, on that issue.
Next, I normally appoint candidates to full-time office only after they have served part time for long enough to prove their competence and suitability. When considering the merits of candidates for appointment, I consider the independent assessments of as many members of the serving judiciary and the legal profession as possible. The consultation community is very wide. This is one of the areas of my department's work which is most thoroughly researched. I welcome the remarks of the noble and learned Lord, Lord Mackay of Drumadoon, in that respect. It would be difficult to conceive of a fuller system of peer appraisal. At present, I am considering this year's Silk applications. I have no less than 4,600 comments on the merits of individual applicants to consider. Last year 511 applied and 60 succeeded. This year 553 have applied. It is a highly competitive process in a merit-based system.
I cannot change the world overnight, but there are encouraging signs that women and ethnic minority practitioners are now coming forward in greater numbers. Without prejudice to the overriding principle of appointment strictly on merit, I hope to be able to appoint many more women and ethnic minority practitioners to judicial office in the coming years. Last year I was able to recommend for Silk 10 women and four applicants from an ethnic minority background. These figures of successful applicants represent over 20 per cent. of the applicants in each category. In December 1994, 7.6 per cent. of the main tiers of the judiciary were women. The figure is now over 9 per cent; and the picture is changing.
We have had a short but good debate on the initiative of the noble Lord, Lord Patten, on a subject which has become somewhat topical. I am sure that the debate will prove to be a source for opinion which we will consult in the future because of the quality of your Lordships' contributions this evening.

Health Bill [H.L.]
8.39 p.m.
House again in Committee on Clause 16.
Baroness Gardner of Parkes Baroness Gardner of Parkes had given notice of her intention to move Amendment No. 119:
Page 13, line 25, at end insert ("from that document or information alone, or in combination with other information which is in the possession of, or is likely to come into the possession of the Commission,").
The noble Baroness said: I believe that my noble friend Lord Howe would want me to move this amendment in his absence; indeed, as I understand the procedures involved, I believe that anyone may do so. Unfortunately, my noble friend did not reach the Chamber this afternoon in time to move an earlier amendment. I do not want that to happen again. I believe that the amendment is self-explanatory. I certainly hope that it is. I am pleased to see that my noble friend Lord Howe has returned to the Chamber. I shall not move Amendment No. 119.
[Amendment No. 119 not moved.]
[Amendments Nos. 120 to 123 not moved.]
Clause 16 agreed to.
Clause 17 [Restrictions on disclosure of information]:
[Amendments Nos. 124 to 128 not moved.]
Clause 17 agreed to.
Clause 18 agreed to.
Baroness Thomas of Walliswood Baroness Thomas of Walliswood moved Amendment No. 129:
After Clause 18, insert the following new clause—
PERFORMANCE STANDARDS AND INDICATORS
(".—(1) The bodies mentioned in subsection (2) below must make arrangements to secure continuous improvement in the way in which their functions are exercised, having regard to a combination of economy, efficiency and effectiveness.
(2) The bodies are—

(a) Health Authorities;

(b) Special Health Authorities;

(c) Primary Care Trusts; and

(d) NHS Trusts.

(3) For the purpose of deciding how to fulfil the duty arising under subsection (1), a body must consult—

(a) representatives of persons who use or are likely to use services provided by the body; and

(b) representatives of persons appearing to the body to have an interest in any area within which the body carries out functions.

(4) The Secretary of State may by order specify—

(a) factors ("performance indicators") by reference to which a body's performance in exercising functions can be measured; and

(b) standards ("performance standards") to be met by bodies in relation to performance indicators specified under paragraph (a).

(5) In specifying performance indicators and standards, and in deciding whether to do so, the Secretary of State shall—
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(a) aim to promote improvement of the way in which the functions of a body are exercised, having regard to a combination of economy, efficiency and effectiveness; and

(b) have regard to any recommendations made to him by the Audit Commission and the Commission for Health Improvement.

(6) In exercising a function a body must meet any applicable performance standard specified under subsection (4)(b).").
The noble Baroness said: This amendment forms a link between Clauses 13 to 18 which are about quality and Clauses 19 to 25 which are concerned with partnerships among NHS organisations and particularly between National Health Service organisations and local authorities. In brief, it introduces the concept of best value into NHS practice. The definition of that in the first part of the amendment concerns having regard in the actions that one takes,
"to a combination of economy, efficiency and effectiveness".
As I said, this Health Bill creates a duty of partnership between National Health Service bodies and local authorities. When the Local Government Bill is passed, local authorities will have to conform to best value procedures. Best value principles include the need for meaningful consultation and the involvement of local communities in planning and providing services; the promotion of clarity about how service standards are developed in co-operation with the people using the services; and requirements for reporting on all the processes involved.
However, there is no similar best value requirement on health authorities and trusts at present. It is difficult to see how the new duty of partnership can work unless all the parties to it conform to the same obligations for best value. This difference of approach is part of the culture clash between local authorities and National Health Service organisations, to which reference was made by a number of speakers during the Second Reading of the Bill. Interestingly enough, other organisations have stepped in to support this amendment, which was put forward in collaboration with the consumer organisations. For example, a major drug producing group is worried that, faced with decisions on whether or not to recommend a new drug or a technological innovation, decisions will be made purely on the basis of cost rather than of cost benefit.
The language of the Bill is taken precisely from the language of the Local Government Bill which is going through another place. For example, the proposed new subsection (4)(a) and (b) is an exact replica of Clause 4(1) in that other Bill. The proposed new subsection (5) in this amendment is a replica of Clause 4(3) in the other Bill. During the Second Reading debate the Minister raised the topic of best value when she said,
"The new provisions will provide space for health services and local authorities to think more inventively; to develop innovative solutions to long-standing problems; and to use local resources in new and imaginative ways. They complement those in the Local Government Bill which will introduce the duty of best value for local authorities and enable the Government to remove obstacles to joint working".—[Official Report, 9/2/99; cols. 112–113.]

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This amendment tests the Government's commitment to ensuring that both partners in these partnerships work to the same song book. I beg to move.
Lord Harris of Haringey: This is an interesting amendment. Those of us who are currently involved in local government look forward to the legal introduction of the best value regime, which in many ways will be more testing than the previous system of compulsory competitive tendering. It is an important new regime in that it has as an integral part consultation with the people who use the services, the requirement that the authorities concerned challenge the way in which those services are delivered and think about innovative ways of providing them. It requires that there is proper comparison with benchmarks and other providers and it also involves competition. Those four "C's": consult, challenge, compare and compete, are extremely important. That is a discipline which local government is prepared to take on board. It could well be applied to much of the rest of the public sector. For that reason alone I believe that the amendment has merit and I look forward to hearing the Minister's reply.
However, there is a second reason, which was touched on when the amendment was introduced. If there is the expectation of increased joint working between local government and the health service, it will be extremely difficult, if not totally impractical, for one side of that joint working—the local authority side—to apply best value principles and for the health service not to embrace the principles in the same way. In the interests of ensuring that joint working between the health service and local government is as effective as we would all wish it to be, it makes sense for both the health service and local government to follow a similar regime. For that reason I have much sympathy with the amendment which has been proposed.
Baroness Gardner of Parkes: I have a certain sympathy with the language of the amendment, which I believe is interesting and probably quite effective. However, my sentiments are the opposite of those expressed by the noble Lord, Lord Harris. I am not at all satisfied that the concept of best value for local authorities is nearly as good as the concept of compulsory competitive tendering. I believe that the provision allows people to wriggle out of the concept of good value. They may say, "We thought it was best value bearing everything in mind". The best value element is the one part of the concept that I do not like. Fortunately the amendment does not appear to use those words. It appears to be the consumer organisation which is concerned with that phrase. I support the amendment not on the basis of best value but because it seeks,
"a combination of economy, efficiency and effectiveness".
Those are the words which I value.
Baroness Hayman: It has been interesting to debate the amendment moved by the noble Baroness, Lady Thomas of Walliswood, and to consider ways in which the duty of partnership and the joint working that we wish to foster will take place on the ground. I do not
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believe that there is so great a culture clash as the noble Baroness may have suggested in speaking to the amendment.
While we want to see joint working it is important also to draw out the differences between the position of local authorities and that of NHS bodies in relation to best value. We must recognise that the relationship of the Secretary of State for Health to NHS bodies, including assigning the status of accountable officer to NHS chief executives, is different from that which exists between local authorities and the Secretary of State for the Environment, Transport and the Regions.
Best value is a duty owed to local people by elected members of councils, and the provisions of the Local Government Bill have been drafted to reflect that. I accept the point made by Members of the Committee, including my noble friend Lord Harris of Haringey, that the principles of best value should apply to the NHS. The Government are committed to driving up performance and standards across the NHS through continuous improvement in both the quality and the efficiency of NHS services. Where I would differ from my noble friend is that it is our belief that this does not mean that we could or should apply those best value principles in exactly the same way. The point is that the regimes should complement each other—I made this point in the Second Reading debate—and that the principles on which they are based should be the same but that we should not necessarily be taking through exactly the same regime.
We have set out in The new NHS White Paper our strategy for achieving the high quality and efficiency to which I have referred, with specific proposals to strengthen the existing statutory and performance management framework through introducing the duties of quality and of partnership on all NHS bodies, now being given effect to through this Bill; through requiring health authorities to lead the development of a local strategy for improving health and modernising services and for ensuring the active involvement of local service users and local communities in that process, which is covered by Clause 21 of the Bill and to which I know Members of the Committee pay particular attention; through setting clear national standards that will apply to all NHS bodies; through the establishment of the national institute for clinical excellence and the development of national service frameworks for assuring local delivery; through the introduction of clinical governance arrangements and to complement existing corporate governance arrangements to ensure probity and regularity; and, finally, through monitoring performance through a national performance assessment framework, the establishment of the commission for health improvement and the annual surveys of patient and user experience.
These measures will complement the Secretary of State's wide-ranging powers of direction over NHS bodies which are subject to external audit by the Audit Commission to ensure that they have proper arrangements in place to secure economy, efficiency and effectiveness—the criteria to which the noble Baroness, Lady Gardner of Parkes, referred—in the use of their resources. Taken together, they ensure that our approach

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to improving performance in the NHS is consistent with those principles underpinning the best value regime being introduced for local government. However, as I said earlier, that does not mean that the detailed provisions should he the same for NHS bodies.
This amendment seeks to provide NHS bodies with similar duties of best value to those provided for local authorities in the Local Government Bill. I hope the Committee will understand that we can achieve this through the powers already available to us, including the Secretary of State's powers to direct NHS bodies. In a number of important respects, those powers are strengthened and those arrangements made more robust. I would therefore suggest to the Committee that importing wholesale the best value provisions from local government is not the best way forward. I trust that the noble Baroness will feel able to withdraw her amendment.
Baroness Thomas of Walliswood: I thank the noble Lord, Lord Harris of Haringey, for making some points on my behalf with which I entirely agree. I did not do so because I felt that time was moving on. I thank him all the same. I thank the Minister for a very careful answer. I must confess that I do not find myself entirely at ease with all the points she made. We are talking here about a partnership with local authorities which involves joint commissioning of services. It involves commissioning services from each other, or the possibility that that should happen. If one comes at that from a different standpoint, one could be getting oneself into trouble. However, I do not want to dispute every point that the noble Baroness raised, as that would take another three-quarters of an hour. I shall read carefully what she said. I shall withdraw the amendment at this stage but may come back with another version of it at a later date. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 130:
After Clause 18, insert the following new clause—
STANDING CONFERENCE
(".—(1) The Secretary of State shall establish a standing conference (referred to in this Act as the Standing Conference) which shall have the duty of—

(a) conducting an annual review of, and the making of reports and recommendations to the Secretary of State on, treatment priorities and funding in the NHS after consultation with the National Institute for Clinical Excellence; and

(b) establishing a clear set of values and guidelines to clarify the decision-making process to be applied by Health Authorities, Special Health Authorities, Primary Care Trusts and NHS Trusts to ensure that patients are entitled to equal and consistent treatment, to be given clear treatment options and reasons where treatment is denied.

(2) The reports of the Standing Conference shall be published annually and shall take account inter alia of—

(a) the views of the public on the priority of treatments;

(b) the efficacy of treatments;

(c) the cost benefit of treatments; and

(d) the affordability of treatments.

(3) The members of the Standing Conference shall be appointed by the Secretary of State and shall consist of an equal number of lay members and members involved in the delivery of health care.
(4) In exercising his functions under the 1977 Act, the National Health Service and Community Care Act 1990 or this Act, the Secretary of State shall have regard to the reports and recommendations of the Standing Conference.").
The noble Lord said: Several of our debates have touched on rationing. At this time of night I have no intention of instigating a long debate on the subject. Indeed, we alluded to so-called post-code rationing when discussing the commission for health improvement and NICE. However, it is clear that rationing occurs in a number of different ways. It occurs where health authorities have decided that treatments are core and non-core healthcare services; it occurs where health authorities, while generally being favourable to a treatment which may be provided in another district, insist on more evidence than is reasonable in order to ensure that their bills are not unduly inflated; and it occurs where health authorities have run out of money for particular treatments.
When one looks at the whole area of rationing, one sees that there are huge variations in how communications take place with patients about treatments that are being denied. That is a matter of particular concern. The amendment attempts to tackle the first kind of rationing. The second type, we hope, will be dealt with by the combination of NICE and CHIMP. The third is a matter of year-on-year resources as provided to health authorities and NHS trusts. We believe that the first type will be dealt with by our amendment. It seeks to set up a standing conference along the lines of the Dunning Committee which was set up in Holland to provide a public forum in which rationing issues could be debated.
For instance, what is core healthcare? Noble Lords may have seen an interesting article in The Times of 23rd February which looked at the detail of IVF treatment. The article was headed "IVF treatment and the lottery by postcode". Clearly, IVF treatment is not provided on a consistent basis across the country and health authorities have very different views about it. Members of the Committee may have heard on the radio this morning a discussion about chemotherapy and the kinds of so-called chemotherapy cocktails which consultants wish to make but which are denied them by their health authorities. Who in a health authority decides on what is core and non-core? Is the Viagra example the model? Do we expect the Secretary of State to descend in a chariot of fire to make a decision on a single drug; or is there another model? We suggest that there is another model. We are not proposing an executive body or anything that actually takes the decision on what is core and what is non-core. We are suggesting simply a forum available to the Secretary of State to advise him. The pattern of differences between health authorities is enormous.
Nowadays, health authorities, to their credit, are being much franker about whether tattoo removal or infertility treatment is or is not included in their menu of treatments. However, by itself, that is dangerous. It means that potentially we no longer have a national health service. We have a series of health authorities deciding on what treatment is available in their localities. That means, in the words of the Question that

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has been tabled for tomorrow by the noble Baroness, Lady Knight of Collingtree, that people literally have to move house in order to find different treatments. That cannot be desirable. We are trying to ensure that there is at least a forum for a national debate on the subject that is long overdue. I beg to move.
9 p.m.
Baroness Hayman: The noble Lord has argued persuasively that we need to take measures to ensure that we have less unacceptable variation in standards of care in different parts of the country. I do not in any way disagree. What I believe the Committee should consider is whether the establishment of a national standing conference—a national priority-setting body—would be helpful in the process that we have set out in order to ensure a more nationally accountable NHS.
We are already setting up two new national bodies—the national institute for clinical excellence, in order to assess treatments, to examine their clinical and cost effectiveness, and to make the best possible evidence available to local health authorities, trusts and individual clinicians; and the commission for health improvement, whose role we have just discussed, to monitor the implementation not only of NICE's recommendations but of the national service frameworks, which will be aimed at reducing unacceptable variations and ensuring national standards of quality for patients wherever they are.
In some ways the arguments for a national standing council seem persuasive. The noble Lord alluded to the Dutch experience. Other countries have trodden that path but have not found it as easy or as successful a process as he suggests or they perhaps imagined it would be.
To reiterate, we have made it clear that we are committed to high quality, comprehensive services. We discussed earlier the need to ensure equality of access to those services and to ensure that there is not discrimination on the grounds of race or age. It is the Government's responsibility to decide on priorities within the resources that are available. That is not a responsibility that we wish to abdicate. In setting out national priorities, which we did in the national priorities guidance for 1999–2001 that we issued to the service last September, we made that clear.
We have set out our plans for ensuring a clearer national framework within which decision-making by local clinicians and commissions should take place. That involves setting up the national service frameworks, the commission and the national institute, and ensuring that there are clinical guidelines and advice on treatments that should be routinely available within the NHS. That will be underpinned by local clinical governance and the new performance assessment frameworks. There are also the health improvement programmes at local level. All those bodies and undertakings will need to engage the community and the interests of users and carers at appropriate levels. Earlier, we discussed the appropriate lay input into the commission for health improvement.
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We want to ensure a more consistent approach across the country. However, at the same time we must recognise not only that individuals have different needs, to which clinicians will respond, but that local services need to reflect local needs and take account of local views. We recognise that health authorities and primary care groups are in the best position to make judgments as to which services and which treatments are required, but we want them to do that within a stronger national framework. We are setting about creating that stronger national framework after the fragmentation of the past. I hope that on that basis the noble Lord will accept that the aims that he intends to promulgate with this amendment are being addressed by various measures from the Government.
Lord Clement-Jones: I thank the Minister for that interesting reply. In a sense, it attempts to offer the best of both worlds—strong local views and a stronger national framework. I am not sure which bit is going to give at the end of the day.
Interestingly, the Minister did not mention Greg Dyke's NHS charter, which clearly has a role in this provision. If the Government accept any or all of the Greg Dyke formula, I should have though that subsection (1)(b), dealing with establishing a clear set of values and guidelines to clarify the decision-making process to be applied by health authorities, would be attractive. One does not quite understand the status of the Greg Dyke exercise; however, he has made some interesting suggestions. They fit in with the local decision-making aspect mentioned by the Minister.
Baroness Hayman: I am grateful to the noble Lord for giving way. He is absolutely right. The recommendations from Greg Dyke on the current patient's charter and how we could move forward on the NHS charter are interesting. He makes the point that, while there are some basic values which he believes ought to be national standards, he very much feels that charters ought to be determined at local level. I did not refer to this in particular, although we intend to take forward those proposals and, before too long, issue suggestions for consultation throughout the service. Setting national standards is the responsibility of government, after proper consultation, rather than the responsibility, as this amendment would make it, of a standing conference.
Lord Clement-Jones: I thank the Minister. That was the most interesting of her responses. It demonstrated the direction from which the Government are approaching the matter. I look forward to consultation over the Greg Dyke proposals.
I agree that, when discussing rationing, there are difficult issues in relation to national bodies and whether there can be a consistent overall set of core healthcare treatments which form the NHS service. The Minister may have been thinking of Oregon, New Zealand and other such places as providing difficulties. If that is not to be the model that the Government wish to follow, the NHS charter model pursued by Greg Dyke must in a sense be the alternative approach: a broad set of values

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are laid down by which health authorities and NHS trusts are expected to be guided. The indication from the Minister is that that is the direction in which the Government wish to go, subject to consultation. To that extent, this has been an interesting exchange. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Lucas Lord Lucas moved Amendment No. 131:
After Clause 18, insert the following new clause—
("Access to information
ACCESS TO INFORMATION
The provisions of Part VA of the Local Government Act 1972 shall apply to a Primary Care Trust and to the Commission for Health Improvement as if in that Part any reference to a principal council included a reference to a Primary Care Trust and the Commission for Health Improvement.").
The noble Lord said: This is a purely probing amendment. I do not suggest that the Local Government Act 1972, or even a reference to it, belongs in this part of this Bill, but it is a useful model for deciding whether meetings of councils or public bodies should be open to the public. It seems to me a much better, more up-to-date and much more New Labour freedom-of-information model than that which is embedded in the Public Bodies (Admission to Meetings) Act 1960, which is an ancient piece of legislation applying principally to health authorities and parish councils. I believe that, if the department had had the opportunity to address itself de novo to how meetings of health authorities and the bodies referred to in the amendment should be made open to the public, it would not have set the provision in the following words:
"A body may … exclude the public from a meeting … whenever publicity would be prejudicial to the public interest by reason of the confidential nature of the business to be transacted or for other special reasons …
"A body may … treat the need to receive or consider recommendations or advice from sources other than members, committees or sub-committees of the body as a special reason why publicity would he prejudicial".
That amounts to carte blanche to close meetings to the public. I hope that that is not what the noble Baroness contends should be the case with these bodies. I hope that she will be able to give me some comfort that in practice she would expect a much more open set of attitudes than would be permitted under the Bill as it now stands. I beg to move.
Baroness Hayman: I hope that I can give the noble Lord some reassurance on the issues which concern him. The Government are committed to openness and transparency of process and the principle that public bodies be accountable to the people they serve.
The noble Lord rightly points out that, while we have made provision in the Bill for primary care trusts and the commission for health improvement to hold their meetings in public, this is done by making them subject to the Public Bodies (Admission to Meetings) Act 1960, which is the Act that NHS bodies are generally committed to. It is our firm intention to extend this to primary care trusts, and we have done that in paragraph 1 of Schedule 4 to the Bill. I was interested to hear the
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noble Lord say that because this was an Act of 1960 it was ancient legislation. I suggest to him that in your Lordships' House legislation of 1960 is probably not ancient legislation. It is, however, as he correctly points out, not phrased in exactly the same terms as the Local Government Act 1972, which requires committee meetings to be held in public and agendas and minutes to be made available to the public.
I suggest to the noble Lord that the commission for health improvement and primary care trusts are more like health authorities and trusts than they are like local government. They will not have a large and complex committee structure at which main decisions are taken. The majority of the business of the commission for health improvement is likely to be undertaken in main meetings. While there may be some sub-committees, they are likely to be on technical and administrative matters. To make such meetings open to the public would impose considerable administration and costs on the organisation. The document published last year, Quangos: opening the doors, which I hope he will recognise as showing our commitment to openness in the working of non-departmental public bodies, makes clear that there are costs involved in these matters.
We want to be as open as possible. We believe that meetings should generally be held in public. Both primary care trusts and the commission will hold open annual meetings at which members of the public will have an opportunity to question and gain greater understanding of the work of those bodies.
The noble Lord suggested that there was something rather sinister in the ability of those bodies to meet in private and not to make documents public when they thought that necessary. Given our earlier debate on confidentiality, Members of the Committee will be aware that both bodies are likely from time to time to deal with matters of a confidential nature and that at such times it is reasonable that the public should be asked to withdraw. The same arrangements to maintain confidentiality should apply to any papers made available to PCT boards and the commission. To complete the picture, I should add that, as we discussed earlier, specific provision is made in Clause 15(2) and paragraph 12 of the schedule for the commission to make its findings public and to issue an annual report.
In addition, the local NHS has a duty to consult widely where there are proposals for change in local services. There is already a requirement on NHS bodies to publish annual reports and to make available other information to the public concerning plans for health and healthcare. We do not wish to impose further administrative burdens and costs on the NHS. Earlier we had a debate about the importance of ensuring that maximum funding is directed at delivering and improving services for patients.
I hope that, in view of what I have said, the noble Lord will feel that not only is there already extensive provision as to public access to proceedings and reports of both the commission and primary care trusts but that there is absolutely no intention that those bodies should operate in any kind of shadow and that we are committed both to openness and transparency of process.
9.15 p.m.
Lord Lucas: I am very grateful for the Minister's explanation but it does not go a very long way to address the basic question that I ask; namely, why these new bodies and existing health authorities are given a blanket permission to close meetings to the public, whereas local authorities are allowed to close meetings to the public in particular circumstances but are not given a blanket permission. The difference is that in the case of local authorities and other bodies certain circumstances will arise where it is right to close meetings to the public, but those circumstances are specified in the Act. Under this legislation and that which applies to existing health authorities—one asks why the opportunity is not being taken to revise the latter—these authorities are given blanket permission to close meetings to the public. The noble Baroness appears to believe that a formal annual general meeting every year—rather like some corporate bunfight—is sufficient to meet the obligation on health authorities to open their meetings to the public.
Baroness Hayman: If the noble Lord will forgive me for interrupting, I believe that he has misrepresented what I said. I did not say that I believed one annual meeting to be sufficient. I thought I had made it clear that the Government considered that these bodies, governed as they would be by the Public Bodies (Admission to Meetings) Act 1960, should hold their meetings in public. I take the noble Lord's point that these bodies will be governed by one piece of legislation that does not specify what is a confidential piece of business, and therefore the circumstances in which part of an agenda may be debated in closed session. But the noble Lord should not suggest that the Government consider that there should be only an annual meeting. I hope I have assured the noble Lord that, unless there are confidential matters on the agenda, the intention is that these bodies will meet in public.
Baroness Thomas of Walliswood: I have restrained myself until this moment. I am entirely in agreement with the noble Lord, Lord Lucas, on this matter. As a member of a local authority for 12 years, almost all of our meetings were held in public. Working group meetings were not held in public because no decisions were taken at those meetings and the position was quite different. But any meeting where decisions were taken, whether it be a sub-committee or whatever, was held in public. When matters were not made public it was for a specific reason laid down by statute, always on the basis of advice from the responsible officer in the legal office who served that particular committee. This is a rather different situation. After all, both bodies spend very large sums of public money. A district general hospital spends about as much money as a district authority. I am not sure why one should have greater protection than the other.
Baroness Hayman: I am grateful for the intervention of the noble Baroness. I shall consider what both she and the noble Lord, Lord Lucas, have said. But I hope that the noble Baroness will acknowledge that the
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practice of NHS bodies particularly recently has been to hold meetings in public and not to make use of the provisions in any way to cloud matters or to meet secretively.
Baroness Thomas of Walliswood: I apologise for interrupting the noble Baroness. I am very glad to hear what she says. However, my experience of a few years ago was not in that direction.
Lord Lucas: I am very grateful for the support of the noble Baroness, Lady Thomas of Walliswood. Her experience bears out part of what I have said. I do not argue with the Minister and suggest that there is widespread misbehaviour, but this Bill gives these new parts of health authorities a power which, looking at health authorities and these bodies in general, they should not have. They should be much more tightly regulated as to what items they are allowed to debate in these circumstances.
Lord Nunburnholme: Perhaps I may remind the noble Baroness that a D Notice applies only in wartime.
Lord Lucas: I do not pretend to be able to draft the measure this evening. I am sure that the noble Baroness and her officials will be better at drafting than I am. However, it would be a better basis for legislation to specify in the Bill the information which allows the authorities to close meetings to the public rather than provisions allowing them general good will and giving them blanket permission to close meetings to the public.
I shall consider pursuing the matter at Report stage. However, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 19 [Co-operation between NHS bodies]:
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 132:
Page 15, line 32, after ("other") insert ("and relevant voluntary and community organisations").
The noble Baroness said: In Clause 19 we move from the Commission for Health Improvement to the duty of partnership. The purpose of Amendment No. 132, and Amendment No. 134, tabled by the noble Lord, Lord Harris, extends the duty to co-operate to include a duty on NHS bodies to co-operate with relevant voluntary and community organisations. The amendment in the name of the noble Lord, Lord Harris, carries that concept somewhat further forward. It places a reciprocal duty of co-operation on those bodies with the relevant NHS bodies.
The purpose of the amendment is to bring about better co-operation, communication and co-ordination between different parts of the NHS for the benefit of the public. NHS bodies should try wherever possible to work closely and co-operatively with outside agencies and non-statutory bodies such as community and voluntary groups, community health councils and other groups representing patients and health service users, advice and welfare agencies and the professional organisations and trade unions representing NHS staff.
We from these Benches believe that such groups can offer a great deal of help to the NHS. Patients and patient groups are often well placed to advise on the quality of current services and to suggest ways in which services could be developed and improved. Advice and welfare agencies can bring a wider perspective to the NHS—for example, on public health issues such as the effects of poor housing and health. Professional organisations such as the Royal College of Nursing, the British Medical Association and the Royal College of Midwives also have a contribution to make.
Many NHS trusts already benefit from working closely with those organisations on such issues as employment policies and policies relating to clinical practice. Further co-operation of that kind, we believe, will benefit patients and staff and is to be encouraged. I beg to move.
Earl Howe: I am sympathetic to the general thrust of the amendments and the thinking underlying them, but I cannot support them. While we all want to see the best possible co-operation between the NHS and voluntary groups, it is no good imposing a duty in law on the health service to co-operate with such bodies when no corresponding duty is being created in reverse. There has surely to be symmetry. One would have to widen the scope of the Bill quite dramatically to achieve that, even presuming that it seemed to be a good idea in the first place.
Baroness Carnegy of Lour: I agree with what my noble friend said, but I believe that there is something behind the amendment to which the Government should pay attention. At the annual conference of the National Council of Voluntary Organisations on 21st January, the Prime Minister made what I think he intended to be a key speech on government policy. Perhaps I may quote one part. He said:
"In the second half of the century we learnt that government cannot achieve its aims without the energy and commitment of others—voluntary organisations, business, and, crucially, the wider public. That is why the Third Sector is such an important part of the Third Way".
If voluntary organisations are the third way, and the "giving society" is a key government policy—I can find no fault with that—it is important to provide in the Bill that the health service bodies consult and co-operate with those parts of the voluntary sector involved in the area in which they are functioning. To that extent I believe that the amendment is important.
Baroness O'Cathain: For clarification, can we be given an estimate of the number of voluntary and community organisations which might be classified as "relevant"? Who will say that those organisations will be relevant? The people in the voluntary and community organisations probably count themselves as relevant, but who is to make the judgment? It could well be that they might not appear to be relevant to the people running the NHS.
Baroness Sharp of Guildford: The term "relevant" appears frequently in legislation in a somewhat ambiguous fashion. In this circumstance, a self-sorting
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mechanism arises. These are the voluntary organisations which are concerned with carers, caring organisations and particular aspects of health. I refer, for example, to the schizophrenia organisation.
Baroness O'Cathain: I believe that to put them on the face of the Bill would invite a huge raft of people to declare themselves as relevant. They may feel that they may have some influence and want to be heard. We could be creating an enormous bureaucracy and a talking shop, which is my problem with the amendments. I can see the principle or the thought behind them, but trying to effect them would be difficult.
Baroness Sharp of Guildford: My proposal is not to list them in the Bill, because there has been criticism of lists which have been given, but to allow for discretion on such occasions.
Lord Hunt of Kings Heath: I agree with what I take to be the intention behind both amendments; namely, to promote stronger relationships between all parts of the NHS and local voluntary, community and patient organisations and to bring about better co-operation. I do not believe that any Member of the Committee would disagree with that. However, apart from the specific points made by the noble Baroness, Lady O'Cathain, in relation to the definition of "relevant", I am not persuaded that the clause is the right vehicle for such a sentiment.
The clause we are discussing is directed to re-establishing the principle of partnership working across the NHS in place of the fragmentation of the internal market. The clause makes clear the reciprocal nature of the duty binding each of the NHS bodies to co-operate with each other. That is a sufficiently important principle to stand alone and I suggest that the clause contemplates a different kind of partnership relationship from that with non-statutory bodies.
I can conceive of few if any circumstances in which one would want to put the same duties of co-operation on these non-statutory, and sometimes informal, bodies as are appropriate to bodies working within the NHS. Indeed, I suggest that the onus has to be on the NHS to reach out to such bodies, inviting their participation in planning and delivering improvements in local services and the health of the local community.
In that context, Clause 21 on developing and taking forward local strategies for improving health and healthcare seems to be the better context for pursuing voluntary body, user, carer and community involvement. There are a number of amendments to be debated on that clause to which we shall turn shortly. However, we have already made clear in previous guidance on health improvement programmes the crucial importance of promoting full involvement in the full range of community, voluntary, user and care interests in developing these plans. Work is in hand with health action zones and others to promote stronger forms of community involvement.

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Given the forthcoming debate on Clause 21, I hope that the noble Baroness will agree that an amendment to the duty of co-operation on NHS bodies would not be appropriate.
9.30 p.m.
Baroness Sharp of Guildford: I thank the Minister for his answer, although I am not satisfied with it. We have deliberately drafted the amendment so that the duty of partnership is on the NHS bodies to share and co-operate with the voluntary organisations.
The point made by the noble Baroness, Lady Carnegy, is extremely important in this regard. Given the role that voluntary organisations play today within the NHS, it is extremely important that they are included and not excluded from that partnership. In the light of that, we shall look carefully at the Minister's reply. We are not fully satisfied with his answer and we may wish to return to the matter on another occasion. However, for the moment, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Earl Howe Earl Howe moved Amendment No. 133:
Page 15, line 33, at end insert—
("(2) To this end any bodies mentioned in subsection (1) which have co-operated with each other in exercising prescribed functions shall—

(a) meet at least 4 times per year in public to discuss partnership arrangements;

(b) invite a representative from all affected community health councils and local authorities;

(c) make an annual report on such meetings to the Secretary of State, which he shall publish.

(3) In subsection (2) "prescribed" means prescribed by regulations made by the Secretary of State.").
The noble Earl said: Clause 19 is a short and delightfully simple-sounding clause which states that:
"It is the duty of Health Authorities, Special Health Authorities, Primary Care Trusts and NHS trusts to co-operate with each other in exercising their functions".
So short is the clause that I feel I must ask the Minister a few questions.
Looking at the clause purely as a matter of law, the first question is very simple: what does the duty amount to? Who is to decide whether the duty has been breached or fulfilled? What mechanisms are to be put in place to ensure that the duty is met? How is the duty to be enforced? What are the penalties for non-compliance? Indeed, are the terms of Clause 19 sufficient to enable a court to reach a judgment on the issue, if it came to that?
That is why we need some flesh on the bones and that is the reason for my amendment. If the duty of partnership is to amount to anything tangible or to mean anything to the public, there must be an opportunity for bodies which are working in partnership to meet to discuss how they can work together more effectively. It is necessary also for those meetings to be reported so
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that patients can be assured that their healthcare bodies are working together in a productive manner. I beg to move.
Lord Hunt of Kings Heath: The noble Earl expresses some scepticism about the duty of partnership laid down in the clause. I regard this is an extremely important component of the Bill.
I believe that the very specific requirement imposed by Clause 21 on health authorities, primary care trusts and NHS trusts—the bodies to whom that duty applies—to participate with their local authority in developing health improvement programmes and in working together to implement them is a clear indication of the strength and breadth of the duty of partnership, because that requirement makes clear that the Bill is about partnership and co-operation for a purpose—namely, improving the health of local communities and improving the health services they use.
We already have in Clause 21 a framework for bringing together all the local players with an interest in an inclusive process. That includes also local authorities and community health councils, along with the wider community and a wide range of local organisations. I am sure that we shall discuss that in depth when we deal with the amendments to Clause 21.
Perhaps at this stage I may concentrate on what seem to be difficulties with the amendment now before us. First, I have some concerns about its scope. Clause 19 is deliberately drafted to embrace co-operation between bodies right across the NHS. In the main, of course, the need will be for local co-operation in the planning and delivery of local services. The health improvement programme process reflects that. But there will be many instances where much wider co-operation is at issue, some of them on important themes on which we have already touched in this Committee—in the commissioning and provision of specialised services, for example; on matters of education and training; or on research. Each NHS body will need to co-operate through a network of different relationships for these purposes and we intend the scope of Clause 19 to reflect that.
I do not believe it would be appropriate to subject each such example of co-operation to the sort of arrangement proposed in the amendment. The key ongoing relationships will be covered by the health improvement programme process. To subject other wide-ranging forms of co-operation to the processes in the amendment would, I fear, prove bureaucratic and burdensome. Indeed, at worst it could prove a disincentive to the very partnership working we are all seeking to achieve.
Secondly, I am uneasy at the concept of a series of meetings and reports "to discuss partnership arrangements." I would much rather see all concerned getting on with the business of working together to achieve some results for their local communities. We want partnership for a purpose and I believe that is what the partnership clauses of this Bill, taken as a whole, offer us.

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I believe that we are right to set a broad duty of co-operation in Clause 19. I should be reluctant to see it circumscribed by procedural requirements. We must certainly ensure that partnership working becomes a reality but I believe that the health improvement programme process at Clause 21 provides a better means of achieving this.
The noble Earl raised some questions about how such co-operation was to be enforced. From my experience of working in the National Health Service we should not under-estimate the capacity of the NHS to respond to the underlying philosophy enunciated in the clause in relation to the NHS bodies we wish to see co-operating. If there were specific situations where it was seen that some NHS bodies were not co-operating and that that was undermining the effectiveness of the health service, exceptionally the Secretary of State's powers of direction could be used over NHS players. But I hope that that will be unnecessary. The clause is an important philosophic statement about the way in which we expect the NHS to conduct itself in the future. I have every confidence that the NHS will accept and embrace that philosophy.
Baroness O'Cathain: Does the Minister really believe that people volunteer to be co-operative the whole time when they have so many jobs to do? This type of arrangement whereby people would need to put into their diaries the relevant names of those with whom meetings had to be arranged once a quarter would target attention to co-operating. They would not allow something to go to the bottom of the in-tray; they would just get on with it.
It may be that these bodies could be told to meet just four times a year in public. If they needed to meet more frequently they could do so because the amendment suggests "at least" four times a year. If people know that they have to meet those with whom they should be co-operating on the basis of once a quarter, that will focus their attention on co-operation. The Minister says it is a philosophic statement. It is also philosophic to say that they should have a target to co-operate.
Lord Hunt of Kings Heath: My experience of NHS bodies, if we take, for example, the area of a district health authority and the organisations within that authority—NHS trusts, primary care groups and so forth—is that they will meet many more than four times a year.
My point is that the duty of co-operation is an important statement about the values within which we expect the NHS to operate. That is unlikely to be added to or solidified by a requirement to meet four times a year. We shall come to this matter later, but as regards joint consultative committees and the requirement to meet with local government, in the past 20 or 30 years we have moved beyond that. Relationships are so important now to provide integrated services that whether or not there are four statutory meetings a year
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would have no effect on that. We have to ensure that everyone in the NHS is signed up to real co-operation. On that basis, stating this duty is important.
Earl Howe: Of course, I understand that it is important, in the context of the Bill, that the various arms of the health service should work together. I did not mean to sound like a sceptic on the concept of partnership or, indeed, to question the worth of making statements of intent. My only concern was that the words that we convert into law should have real meaning; that any duty in law should be capable of being enforced and adhered to, and that there should be proper mechanisms in place to help the parties to do that.
With the best will in the world, there will be conflicts of interests at play, even with this duty in place. My noble friends alluded to those. Health authorities, primary care trusts, NHS trusts and so forth will sometimes have to sublimate their own interests in order to assist or support one another if this duty is to be fulfilled. What happens if they have different priorities? All these questions arise.
I thank the Minister for his reply. However, I shall have to reflect a little further on what he has said. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 134 not moved.]
Clause 19 agreed to.
Clause 20 agreed to.
Baroness Pitkeathley Baroness Pitkeathley moved Amendment No. 135:
After Clause 20, insert the following new clause—
REQUIREMENT OF HEALTH AUTHORITIES TO ASSIST COMMUNITY CARE ASSESSMENT
(".—(1) Section 47 of the National Health Service and Community Care Act 1990 (assessment of needs for community care services) is amended as follows.
(2) In subsection (3), for the words "notify that Health Authority or local housing authority and invite them to assist, to such extent as is reasonable in the circumstances, in the making of the assessment;" there shall be inserted "in the case of a Health Authority require, and in the case of a local housing authority invite, the authority concerned to assist, to such extent as is reasonable in the circumstances, in the making of an assessment;".").
The noble Baroness said: This amendment would require the health authority to assist a local authority when it is carrying out an assessment of a person's need for community care services. The health authority would be required to assess the person's health needs in relation to community care. The amendment also mentions that housing authorities would be invited to assess those needs.
The background is as follows. As noble Lords will know, the National Health Service and Community Care Act 1990 came into force in April 1993. The Act places the responsibility for arranging community care services on local social services authorities. A local authority must carry out a community care assessment where it appears to that authority that a person may be in need of community care services which the local authority may provide or arrange.
Where the local authority believes that the person has health needs, it is required to invite the local health authority to assist in that assessment. However, there is no corresponding requirement on the health authority to respond to a local authority's request for assistance.
Accordingly, the amendment would place a duty on the health authority to participate in the assessment of a person's health needs when asked to do so by the local authority. The amendment makes it clear that the health authority's duty is to assist the local authority,
"to such extent as is reasonable in the circumstances".
In my view, that would very much accord with the duty of co-operation set out in Clause 20. I am sure that it is very much in keeping with the commitment to partnership between health authorities and local authorities which is expressed in the Bill and which, as we know, is active between many of the professionals involved.
I should point out that the amendment has the support of the Association of Directors of Social Services, the Local Government Association, and of charities such as the Carers National Association and Scope. I beg to move.
9.45 p.m.
Lord Skelmersdale: I spoke slightly on this matter at Second Reading. It seems to me to be absolutely vital that if Clause 22, which we have not yet reached, is to stand part of the Bill, the local authorities, social services, health authorities and the whole health machine must talk together before anything can happen. Therefore, I support the noble Baroness in her amendment.
Baroness Thomas of Walliswood: I rise briefly to echo the words of the noble Lord, Lord Skelmersdale. I look forward very much to hearing the Minister's response to this interesting amendment.
Lord Warner: I too speak in support of the amendment. In doing so, I declare an interest as a member of the Association of Directors of Social Services. From my experience as a director of social services, I regard this as a worthwhile amendment which would deal with some of the occasionally difficult cases where health authorities do not always co-operate.
Lord Hunt of Kings Heath: The effect of the amendment would be to require health authorities to assist in community care assessments undertaken by local authorities. I believe that the amendment is unnecessary.
Local authorities are under a duty to give a community care assessment to anyone who, in the authority's view, may be in need of community care services. We have made clear in guidance that these assessments should always involve medical professionals when appropriate, but this will not always be necessary.
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Community care assessments should enable the local authority to make appropriate decisions about service provision, but the exact form of each assessment is something best left to them. In some circumstances, a fully comprehensive assessment will clearly be essential, involving people from a number of professional backgrounds in working with a person with multiple needs to identify the best way forward. But in other cases, a quick and simple assessment may be all that is needed so that necessary help can be provided with minimum delay. Requiring NHS input in every assessment might make it more difficult to target timely help where it is most needed.
I believe that my noble friend and I have the same underlying aim: to get the right services to the right people at the right time. Although I do not believe this amendment offers the best way forward, we do have other action in hand. We set out in our better services for vulnerable people initiative the requirement on health and social services to develop a joint framework for multi-disciplinary assessment of older people in acute and community healthcare settings. Improved multi-disciplinary assessment—where this is appropriate—leads to better co-ordination of care between agencies and better outcomes for service users. I believe this developmental approach to multidisciplinary assessment is the right way of achieving flexibility and better outcomes for service users by tailoring assessment to their needs.
We shall, of course, continue to monitor the development and implementation of these multi-disciplinary assessment frameworks to ensure there is good progress on the aims I have described. I hope that my noble friend will accept that this is a serious endeavour to address the concerns behind her amendment and will not feel the need to press it.
Lord Skelmersdale: Before the noble Baroness goes any further, the Minister mentioned multi-disciplinary assessments. He is, of course, absolutely right, but unless one organisation—the health authority, for example, or the local authority—can push the case of an individual—it will almost invariably be an individual whose needs are being assessed—there will not be a multi-disciplinary assessment. How does the Minister intend to carry this forward? To paraphrase, he said, "We will wait to see how the system develops." I am tempted to use the oft-quoted expression in this House, "How long, dear Lords, how long?"
Lord Hunt of Kings Heath: We should not underestimate the likely impact of the better services for vulnerable people initiative because it is intended to deal with the problem of people slipping through the net who are not best served by the current assessment procedures. In the very nature of achieving better co-ordination care between agencies and better outcome for service users, the whole intention is to deal better with the needs of the individual.
Clearly, noble Lords have raised issues on the basis that it is deemed that the NHS is failing to respond to local authorities in the assessment procedures. It is certainly my hope that NHS failures to provide the

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support the local authority requires are limited. However, there is an overall duty of co-operation and powers of direction under Section 17 of the National Health Service Act 1977 which allow the Secretary of State to direct health authorities and trusts to provide services. So there is a chain of accountability which enables the health service to respond to problems in this area.
Baroness Pitkeathley: I thank the Minister for his thoughtful reply. It is no part of my approach to doubt his commitment and that of other noble Lords to a multi-disciplinary approach to assessment. The amendment was put forward to address the few problem cases we can identify. I shall carefully study what has been said and trust that his hopes are justified about the limited number of cases to which this would apply. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn
Clause 21 [Plans for improving health etc.]:
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 136:
Page 16, line 6, after ("Authority") insert ("and Special Health Authority").
The noble Baroness said: This is a minor probing amendment. We believe that special health authorities as well as the health authorities should have a duty to prepare a health improvement plan. I believe that it is the intention of the Government eventually to phase out special health authorities, but for the moment they exist and it is important that they do not opt out of the health improvement framework in the Bill. I beg to move.
Lord Hunt of Kings Heath: I accept the points made by the noble Baroness, but there is a problem in seeing how the duty in Clause 21 could properly be laid on the special health authorities, which would include NICE, the Central Blood Laboratories Authority and the Special Hospitals Authority. It is difficult to see how they could strictly fulfil the requirements of Clause 21.
We will ensure that all special health authorities work in partnership with others in the NHS and local government to ensure that NHS services are delivered effectively to improve the health of the population. That is why special health authorities are explicitly included in the duties of co-operation in Clauses 19 and 20. Clause 21 is different because it is based upon the duty of each health authority to secure health services for, and advance the health of, a defined local population. All the more detailed requirements of Clause 21 flow from that starting point. It is difficult to see how that could realistically be extended to put this duty on special health authorities, which are established generally with a much more closely defined function, usually exercised on a national basis.
If the intention is to ensure that all special health authorities seek to exercise their functions with the aim of improving health and healthcare, I do not think that there is any disagreement between us in principle. I hope
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that the noble Baroness will agree that extending Clause 21 in the way suggested is not the best means to achieve this aim.
Baroness Sharp of Guildford: I thank the Minister for his most helpful reply. I think we now understand better the reasons for leaving out these authorities. In the light of that, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 137:
Page 16, line 6, leave out from ("Authority") to ("to") in line 7.
The noble Baroness said: Amendments Nos. 137 and 139 would have the effect of making it the responsibility of each health authority to prepare its health improvement plans on a rolling basis, publishing them on a regular annual basis. The reason is to ensure that health authorities recognise that it is their responsibility to produce the plan and thereby have a sense of ownership rather than regarding it as just another of those tasks which must be completed for the department. Annual publication would keep the authority up to the mark. Amendment No. 138 makes it clear that such a plan would provide a framework for wider consultation within the community. I beg to move.
Lord Hunt of Kings Heath: The effect of these amendments would be to put on the face of the Bill a mandatory requirement that a health improvement programme be prepared annually. As a general rule, we would wish to avoid specifying matters of administrative procedure on the face of the Bill. In the case of health improvement programmes, I would be particularly uneasy because one of our aims is to break out of the strait-jacket of the annual planning and contracting round. We certainly intend—as the noble Baroness suggested—that the programme should be rolled forward, and published, each year. Our existing guidance makes clear this expectation. I am happy to give a firm assurance now that this is what we intend for the future.
However, our intention is that the health improvement programmes should cover a three-year period. As they are rolled forward each year, we intend that a number of issues will be reviewed in depth rather than the whole plan being updated in every detail. We believe that this will enable better planning for strategic change. Critically, it will allow more time for the in-depth involvement of users and carers, community groups, clinicians and other staff—all those whom noble Lords are keen to see more fully engaged and who, as my noble friend Lord Harris, the noble Lord, Lord Rix, and others, have pointed out, have found the traditional arrangements for formal and tightly timetabled consultation on comprehensive plans so frustrating.
We want to develop the new arrangements differently. For example, we expect the health improvement programmes for the period beginning April 2000 to cover implementation of the first two national service frameworks on coronary heart disease and mental health. If we take the example of mental

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health, I can tell the Committee that during 1999 we envisage that health authorities will plan to bring together NHS trusts and the clinicians concerned, primary care groups, social services and other local authority representatives—such as housing—and other local players, together with users, carers and the voluntary groups to whose important contribution the noble Lord, Lord Rowallan, drew our attention earlier in the proceedings. The intention is that, together, they will take the time to look in depth at what needs to be done and plan the way ahead. When the programme comes to be rolled forward again, the same sort of in-depth review would be applied to other topics.
It is on that basis that I would be reluctant to see us put anything on the face of the Bill that bound us tightly into an annual round at the expense at this sort of in-depth planning on a longer cycle. I hope that I have reassured the noble Baroness of our clear intention to see regular publication of what is contained in this work and that, on that basis, she will be prepared to withdraw the amendment.
Lord Skelmersdale: If that is the case, why does not the Bill say so?
Lord Hunt of Kings Heath: We have certainly made it clear in guidance that this is what we intend to see happen. However, I am not sure that one would necessarily want to constrain on the face of the Bill for all time the necessary administrative arrangements in relation to the publication of plans. The intention, though, is quite clear.
10 p.m.
Baroness Sharp of Guildford: I thank the Minister for his reply. I am not totally satisfied with it because it seems to me that the sense of ownership that I spoke of is an important issue. However, in the light of his reply, for the moment I shall withdraw the amendment and reconsider the issue at a later stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 138:
Page 16, line 10, at end insert—
("( ) Health Authorities shall before drawing up any plan under this section consult relevant voluntary and community organisations, including in particular organisations representing carers.").
The noble Baroness said: In moving Amendment No. 138, I wish to speak also to Amendments Nos. 140 to 144, 146 and 147. This series of amendments all relate to issues of who shall be consulted by health authorities when they draw up local health improvement plans. We believe that the wording of the Bill as it stands is too vague. The purpose of these amendments is to flesh out consultation arrangements and to ensure that the process is broad and that there are statutory requirements to include certain organisations or kinds of organisations within the process of consultation.
Our main concern in framing these amendments is to ensure that the consultations over the health improvement plans are thorough, inclusive and effective. We reject the approach of Amendment No. 141 in the name of the noble Earl, Lord Howe, because we believe that it is too prescriptive. We do not think that lists of this kind are the right way to handle this issue. Nor do we see why central organisations such as the BMA or the RCN should be included in this process at the local level. There must be some local flexibility. We therefore believe that the right approach is to list—as we have done in Amendment No. 143—the kinds of organisations that should be included.
As is clear, Amendment No. 143 is supported by the noble Lord, Lord Rix, who is unable to be here today. He has asked me to read out his contribution to this debate. The noble Lord wishes to bring a quick example to the Committee's attention to highlight the importance of delivery of public health initiatives to people with learning disabilities. Some of the inequalities in access to healthcare are quite startling. Research by Mencap reveals, for example, that cervical smear testing in women with learning disabilities is as low as 3 per cent. for those living with their families compared with the UK average of 85 per cent. This is clearly unacceptable. We must ensure that groups of and for people with learning disabilities are well represented in the formulation of local health plans of this kind. I beg to move.
Earl Howe: I am all too well aware that Amendments Nos. 141 and 144 tabled in my name fall foul of the Skelmersdale injunction against shopping lists, and I accept the criticism. However, I believe they serve a useful purpose. This is not just a ritualised exercise in listing. What it is designed to emphasise—as has been said already—is that consultation has to be wide and inclusive, and that health improvement programmes cannot just be imposed. There needs to be a sense of ownership on the part of all those directly involved. That comprises a great many groups of people.
Amendment No. 144 specifically refers to universities and schools for medicine and nursing or professions allied to medicine. It does so because one needs to remember how important those are to the functioning of the health service as we know it. If I were to single out one group for special mention, it would be the voluntary organisations because so often it is those groups who represent users and carers who can identify needs and gaps in the current provision, particularly as they affect minority groups or those who may find it difficult to access mainstream services. During the first round of health improvement programmes it has not always been easy for voluntary organisations to contribute as ideally they would wish to do. That is why I believe it is particularly important that their voice should be heard during the process of consultation.
The Explanatory Notes to the Bill make it clear that the process is intended to engage voluntary bodies. The Secretary of State's direction-making powers in Clause 21(5)(a) and Clause 21(6) could be used to ensure that such bodies are involved. But there is a gap here. What mechanisms will there be to ensure that the

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Secretary of State is aware that the process is not working as perhaps it should? How will a voluntary organisation, if it is out of the loop, so to speak, know what is going on and how it can make an appeal? I shall be pleased to hear the Minister's comments.
Lord Walton of Detchant: I would not wish to anticipate whether the noble Lord the Minister or the noble Baroness the Minister—in tonight's double act—will respond to these amendments. Having said that, I am sure that I can anticipate their response. They will say that these amendments are unnecessarily detailed and prescriptive. The point that has been made by the noble Earl about the involvement of the universities is absolutely crucial. The universities are now playing an increasingly important role, not only in the training of doctors and dentists, but in the training of nurses, physiotherapists, occupational therapists and many other health care professionals, including speech and language therapists. Scientists too are playing an increasingly important role in the NHS as are the medical laboratory technologists and many more.
I know that, at an earlier stage of the Committee's proceedings, the Minister gave us a number of assurances about the involvement of and consultation with the universities. But in some way the important role that they play, like the important role of the voluntary organisations to which the noble Earl has referred, must be acknowledged in the proceedings on the Bill.
Lord Harris of Haringey: Amendment No. 140 stands in my name. It highlights the importance of involving not only community health councils but groups representative of patients and groups representative of carers. One of my concerns is that while the health improvement programme process will be an extremely important one, there is a danger that it will be dominated by institutional structures and by the various statutory agencies. Bringing them together and getting them to talk to each other about these matters is a considerable step forward and of benefit to the local community. It is important that measures are taken which, on the face of the Bill, ensure that there is an expectation that user groups, carers groups and the local community health councils are involved in the process of drawing up health improvement programmes.
It is also worth recognising that if these programmes and plans are to mean anything they will lead to resources being shifted from one area to another between priorities. Locally, this might be very controversial, and the achievement of long-term national and local priorities—particularly in the reduction of health inequalities—may mean that established services have to be reconfigured or cut if further resources are not identified. For that reason it is particularly important that the groups set out in my amendment are fully involved and that there is a clear expectation set out on the face of the Bill that they will be involved in order to ensure that there is public support and consent for the changes which will come forward through this process.
Lord Rowallan: I, too, rise to support the amendment of the noble Baroness, Lady Sharp of Guildford. It is
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essential that the voluntary organisations are mentioned on the face of the Bill. The point made by my noble friend Lord Howe is terribly important. If by any mischance the voluntary organisations miss out on this whole future arrangement, how will they get back into the system? I should appreciate an answer from the Minister on this very important point.
Lord Hunt of Kings Heath: As the noble Earl said in speaking to his amendment, we have returned to the subject of lists and the "shopping list" phenomenon described so eloquently on the first day of our deliberations in Committee. Many of the lists that are before us reflect the dangers that we have already discussed. There are very few proposals on which I take issue in principle. Indeed, some of the amendments, in particular Amendment No. 143 tabled by the noble Lords, Lord Clement-Jones and Lord Rix, bear a striking resemblance to aspects of the guidance that the department has already issued on this subject. Indeed, if one were to be drawn further into the list business, one might say that important groups of NHS staff still appear to be missing from the amendments as tabled. While the noble Lord, Lord Clement-Jones, has done justice to the dentists, pharmacists might have good cause to feel hard done by, as none of the detailed definitions appears to cover them.
Turning to general principles, this debate has brought out the importance that we all attach to seeing health improvement programmes developed and implemented through arrangements that are truly inclusive. That is entirely what the Government want to achieve. The existing guidance points out to the wide range of local stakeholders that we wish to see all staff engaged, not merely professional representative bodies: voluntary groups, users, carers, the wider local community and other partners such as universities, local schools, employers and others. We could not have been clearer in the message that we have given to the National Health Service.
We have also made it clear that we are looking for full involvement, not the traditional type of NHS consultation, which I have known and loved for so many years; namely, brief consultation on a plan that is all but finalised. We wish to see active participation right through the process of assessing local needs, identifying the best way to respond to national and local priorities and developing firm plans for action. I am convinced that that will mean new ways of working. Through health action zones and other means we are already encouraging innovative approaches to partner and community involvement. And we are supporting health authorities and others in developing the skills that they need to acquire in order to achieve that. Many local authorities have valid experience in community involvement which we hope that they will bring to the table of discussions and joint working between the health service and local government.
The amendment proposed by the noble Earl, Lord Howe, draws particular attention to the importance of ensuring proper links to the universities and to the wide arrangements for the education and training of those

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who work in and with the NHS. The noble Lord, Lord Walton, had some important points to make on that issue.
It is our intention that those links should be strong. Indeed, I do not believe that the NHS could hope to be successful in the future unless it had very strong links with universities and institutes of higher education, to which we look for so much support, collaboration and co-operation.
Equally, it is critical that the service needs identified by the health improvement programmes feed into the planning of education and training programmes, so that staff numbers and skills match local needs. We want the process of achieving partner involvement to be transparent. That is why we have already asked for health improvement programmes to record not merely those who have been involved in their development but how they have been involved and what plans there are to build on that in the future.
We recognise that developing strong partnerships may take time. We have asked that the first improvement programmes include an honest account of what has been possible for this first round, and where more remains to be done. We shall monitor progress on this matter very closely.
The subject of learning disabilities was raised, which I am sure would have been raised by the noble Lord, Lord Rix, had he been able to be present. We have asked health authorities to take particular care to involve groups who have tended to be under-represented. We fully recognise that learning-disabled people have often fallen into that category. As I have previously explained, with the opportunities of a three-year rolling programme and a new approach to involvement, we very much hope that we have the process with which to be able to achieve that.
I hope I have made clear the Government's commitment on this front. I would add that, over and above the general concerns that have emerged about lists of organisations, I have some particular concerns in this instance. I believe that there is a real risk of highlighting some local players rather than others, while an attempt to be comprehensive seems doomed to failure. Equally, we do not want to see health authorities checking exhaustively that they have made contact with every player on a national list in a "tick-the-box" mode. I believe that that has been the traditional experience of NHS consultation, which has not worked very effectively in the past. I believe that our effort is injecting into the NHS a new spirit of real participation with the kind of organisation and players that Members have mentioned tonight. We want to see them grasp the spirit of inclusiveness and work out imaginatively who needs to be engaged, and how they can be engaged, in different elements of the process. For example, local businesses and employers may be key players on some local issues but have much less reason for involvement in others. Different community and voluntary groups, and different users and carers, will have their own special interests. This is precisely the kind of detail that
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is best left to local handling within a clear direction set through guidance or perhaps, where necessary, secondary legislation.
Clause 21(5) enables the Secretary of State to issue directions should there be difficulty in securing proper involvement either nationally or locally. I believe that the arrangements I have described mean that we shall be able to monitor progress and act if need be. That is why the power is there.
I hope that the assurances I have been able to offer and the safeguards available will meet the concerns that have prompted these amendments.
Baroness Sharp of Guildford: I thank the Minister for his reply. As the noble Earl, Lord Howe, said, it is extremely important that these local health improvement plans are locally embedded and locally owned. That is why the whole process of consultation is so important. As the Minister stressed, that has not been the habit of the NHS, and old habits die hard. There are occasions when it is useful to embody new procedures in statutory instruments rather than in directions. This might have been an occasion when it would have been useful to do so in order to push people out of old habits. However, given the Minister's assurances that he will monitor progress and that, if this provision does not seem to be sufficient in engendering a new spirit of consultation in local NHS participants, he will issue the necessary directions, I shall withdraw the amendment for the present time.
Amendment, by leave, withdrawn.
[Amendments Nos. 139 to 144 not moved.]
10.15 p.m.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 145:
Page 16, line 37, at end insert ("which shall include needs assessment, statement of resource (including human resource) requirements and identification of priorities for action,").
The noble Lord said: On the previous Committee day we had a most interesting discussion on Amendment No. 64 relating to medical workforce planning and the shortage of consultants. Amendment No. 145 is similar in intent. I believe that we on these Benches have made it clear that we very much welcome the health improvement plan process. Indeed, I am very influenced by the document produced by the department which considered why Health of the Nation had not been as effective as it might have been. I have a suspicion that, if we get these health improvement plans right, they will make Our Healthier Nation successful where The Health of the Nation was not. Health improvement plans may be the instrument by which to do that.
That said, there is nothing on the face of the Bill as to how matters are to be dealt with in relation to the content of the strategy stated in Clause 21. We believe that that is a gap. The circular itself to an extent goes into the detail but we believe that it is important to state at least some of the contents of the plans. For that reason we have repeated some of the wording of the circular. The noble Lord, Lord Hunt of Kings Heath, has spotted the way that we have put together the amendments; namely, we have looked at the circulars to see what is

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in them. We believe that that is a reasonably informed way to do it. I admit that we gagged slightly at the phrase "resource mapping", since we were not sure how many members of the Committee would accept the insertion of such a phrase on the face of the Bill. We thought that "human resource planning" might be slightly less jargonised.
This is a matter of some concern. As in the case of medical workforce planning, hospital doctors wished us to table this amendment, particularly the aspect of human resource planning. They wanted us to make the point very strongly that the whole question of the number of jobs and the people required to fill them—the human resource requirement of hospitals—was a matter of intense and important debate at local level. It was an opportunity for staff, particularly junior staff, to get involved in discussion particularly about levels of staffing required in hospitals. This may be a bridge too far in terms of wanting to insert this in primary legislation but it is nevertheless a very important point. Junior staff in particular should be allowed to enter the debate and discuss the human resources required at their level. I beg to move.
Lord Hunt of Kings Heath: I am sorry that the noble Lord does not like the term "resource mapping". I regarded it as a rather good phrase. I readily recognise the important point he makes that the human resource dimension should be fully taken into account in relation to the future plans and priorities of the health service at local level. All of us with experience of the NHS are aware of the problems that can arise when this is not done. The intention expressed in this amendment is one that the Government absolutely share. As the noble Lord implies, this matter is reflected already in guidance that we have issued in the health improvement programme process. The issue before the Committee is not whether those plans should take proper account of needs assessment and available resources including, critically, appropriately trained clinicians and other staff. Clearly, they should. They should certainly focus on local and national priorities and the way that they can best be addressed. The difference between us is not about our aims but about whether this kind of essentially procedural detail belongs on the face of the Bill.
The Bill includes a direction-making power that combines the ability to specify certain core requirements, should that seem appropriate, with flexibility to modify and update these in the light of experience. I believe that this offers the best means to ensure that the points put forward by the noble Lord are given due weight. It has already been stated that the HR requirements of the health improvement process will be published within the health improvement programme. We have also made clear that when we talk of the need to take account of the views of staff we mean all staff—not just clinicians and professionals but all staff in the health service. I hope that on that basis the noble Lord is prepared to withdraw his amendment.
Lord Clement-Jones: I thank the Minister for that very helpful reply, which is not unexpected. Clearly, this is an issue that needs to be aired because it is a matter
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of considerable importance particularly to those staff within NHS trusts. I fully accept that the intention is that they will be involved in that process. We look forward to seeing how that works in practice. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 146 and 147 not moved.]
Clause 21 agreed to.
Clause 22 agreed to.
Clause 23 [Payments by local authorities to NHS bodies]:
[Amendment No. 148 not moved.]
Clause 23 agreed to.
Clause 24 [Arrangements between NHS bodies and local authorities]:
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 149:
Page 20, line 17, at end insert—
("( ) Nothing contained in this section shall permit charges to he made for health care by any local authority.")
The noble Lord said: This is potentially an important amendment. It goes to the core of joint working arrangements on food, budgets, and so on, It seeks clarification on the interface between social care and healthcare. Clause 24 allows the NHS and local authorities flexibility to work together in new ways by pooling budgets and delegating functions and resources. Health and local authorities will be able to agree which is best placed to provide particular functions.
However, it is incumbent on the Government to answer a number of questions about the way in which those arrangements will operate. Do they recognise the barrier that charges present to joint working at present; and the fact that those problems will increase with an unamended Bill? Precisely when do they expect to publish guidance on charging? Currently it is not available.
Charges cannot be made for NHS services, but local authorities are under a duty to charge for residential services and have the power to charge for non-residential services. We are concerned that it is not clear how the charging for services will work. Most local authorities now charge for non-residential services. But the current charging policies are complex and confusing. We are concerned that many carers may be paying for services received by the person for whom they care despite the fact that carers should not be charged for such services.
We welcome the statement in the government paper, Partnership in Action, about guidance being issued. However, there is little consistency nationally on charging. Little consideration is being given to the impact of charging on the joint working arrangements.
The Select Committee on health—we have referred to it on previous occasions during Committee stages—commented about the confusion as to which agency, health or social services, is responsible for which service. It said that this confusion is epitomised by the farcical question of whether a person in the community needing a bath should receive a "health" bath or a "social" bath. The first comes free; the second, in theory

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at least, has to be paid for on a means-tested basis. I do not wish to carry things to their logical conclusion—that clearly takes things to an absurdity—but it is a typical example of what could grow into a considerable problem with the joint working arrangements. We are concerned that the requirement to charge for social care proposed by the Bill could lead to more services being treated as social care and therefore subject to a charge, thus seriously undermining the principle that healthcare should be provided free of charge. The amendment ensures that the situation is clarified.
Perhaps I may refer to other services such as physiotherapy. The chartered institute is worried that, where local authorities are the lead provider of some community health services, the services will be prevented through means testing and that there will be charging for them. We on these Benches wish to see on the face of the Bill confirmation of the Government's intentions. I beg to move.
10.30 p.m.
Baroness Thomas of Walliswood: I wish to speak in support of the amendment on behalf of the noble Lord, Lord Rix, who cannot be here today. One of his principal concerns about the Bill is to ensure that partnerships between health and social services are well managed financially and operationally. MENCAP's recent report, Fully Charged, reveals that there is a growing trend towards charging people with learning disabilities for important community care services, such as day care attendance.
We need to ensure that services which are currently provided free by the NHS remain free once these new partnerships are forged. That was the point made by my noble friend. Lowering the boundaries over what counts as health services and social services should be to the advantage of service users, not to broaden the scope for charging.
Lord Hunt of Kings Heath: I acknowledge that there are issues in this area which we must examine in relation to the responsibilities respectively of health and social services. We will be considering the detail of the framework on charging, promised in the social services White paper, in the light of the recommendation of the Royal Commission report published and discussed in the House today. Until we have studied the recommendations in detail, I cannot say when we will publish the framework.
I believe that the amendment is unnecessary. We have made clear on numerous occasions that we have no intention of changing the fundamental principle that NHS services are provided free to patients. NHS bodies have no powers to charge for NHS services, except where permitted under the 1977 Act. The Bill does not alter that. There is no power for local authorities to charge for NHS services. The Bill does not alter that. Where a local authority provides or commissions NHS services on behalf of an NHS body, those services will remain free to the service users.
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I understand the reason why noble Lords seek the amendment. The use of the new operational flexibilities provided for in Clause 24 will allow health bodies and local authorities to work more closely in commissioning and providing healthcare and local authority services. Under some arrangements, health and social care will be provided by the same body. Under the integrated provider flexibility, a social services authority might develop a service providing some healthcare on behalf of an NHS body—for example, physiotherapy or speech and language therapy—together with domiciliary care. As at present the healthcare provided will be free and the social care could be charged for.
We clearly recognise concerns that the distinction between health and social care may not at all times be sufficiently clear. The simple fact remains that NHS care is free and local authorities have a power and sometimes a duty to charge for the social services they provide. That distinction will remain. I am sure your Lordships will be reassured to know that we fully intend to make that clear in the regulations provided for under Clause 24.
We stated in our discussion document. Partnership in Action, that we would require authorities seeking agreement from the Secretary of State for their use of the new powers to set out clearly how their charging regimes for social services would be applied. Guidance on applications for use of the flexibilities will state clearly the position on charging for healthcare and that NHS services remain free at the point of use. We will require that applicants set out in their proposals how their local charging policies will be applied in the light of that. The bodies concerned will need to set out clearly what is NHS care and what is social care. We will use the application process to monitor how the bodies will ensure that healthcare remains free to users.
I hope that in the light of that explanation the noble Lord will agree to withdraw his amendment.
Lord Clement-Jones: I thank the Minister for that comprehensive reply. I understand what he says about guidance and monitoring, but at the beginning of his answer he seemed to imply that it would be unlawful for a local authority to charge for healthcare services. Is that correct?
Lord Hunt of Kings Heath: Yes.
Lord Clement-Jones: I am taken aback by the brevity of that answer! On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Thomas of Walliswood Baroness Thomas of Walliswood moved Amendment No. 150:
Page 20, line 18, leave out ("may issue guidance") and insert ("shall issue directions").
The noble Baroness said: In moving this amendment, I shall speak also to Amendment No. 151.
The context for these amendments is the loss of the JCCs, which is dealt with in Clause 25. Many voluntary organisations have conveyed to us that those joint

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consultative committees have provided a way whereby the voluntary organisations in particular can play a full part in decisions taken by the local health authority and the local authority. They want the same sort of requirement to be on the face of this Bill in regard to the joint activities of local authorities and the national health bodies under Clause 24.
The wording of Clause 21(5) is stronger in terms of consultation than is subsection (6) of this clause. Subsection (6) provides that the Secretary of State may issue guidance. I believe that we must have "must issue" even though I believe that the word "directions" is less preferable than "guidance". Therefore, I shall not insist on every word of this amendment.
The rest of Amendment No. 151 provides what the guidance must consist of and who the consultees shall be; namely, the local community health council, organisations representing the interests of people for whom the health authority is responsible—that is, people in the locality—and organisations which represent the interests of carers of those people. Broadly speaking, that is the equivalent of those people who currently have a right to nominate people to sit on the JCCs.
I hope that the Minister will recognise that at present, where they are working well, the input of the voluntary organisations and the community health councils is extremely valuable in making sure that work is well-targeted. I hope that the Minister will he able to strengthen the wording of Clause 24 accordingly. I beg to move.
Lord Hunt of Kings Heath: The new approaches to joint working provided in Clause 24 put in place a framework which will allow local innovation. It is very important that we do not stifle innovation by placing on authorities requirements which may not be necessary in every case. I understand that the reason behind the amendment is to ensure that appropriate local consultation takes place when NHS bodies and local authorities wish to use the new flexibilities. But setting out in detail on the face of the Bill who should be consulted on every occasion is against the spirit of local flexibility and partnership which underpins those provisions.
The approach we have taken is to leave the detail of the provisions to regulation while setting on the face of the Bill what those regulations might cover. Subsection (3)(b) of the clause allows the Secretary of State to prescribe through regulations the conditions to be satisfied by authorities, including in relation to consultation. I consider that power to be more than adequate to ensure that authorities consult appropriately.
The Committee will appreciate that we wish to use the regulatory powers sparingly. We do not wish to stand in the way of progress by placing unnecessary burdens on authorities. The Bill allows us to require authorities to consult particular organisations if it is necessary to do so. It also allows us to issue guidance to authorities to help them to ensure that they consult appropriately. I do not believe that we need a further
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power to direct authorities and we certainly do not need to constrain authorities to consult organisations where it may not always he appropriate to do so.
I turn now to the specific issue of community health councils. Of course we want CHCs to be consulted on proposals where appropriate. Health authorities already have a duty to consult CHCs when considering substantial developments or variations in services. And we want patients and carers to be consulted. But those groups will be properly involved in the development of the health improvement programme under which the new provisions will be used. It is important that the right people are consulted at the right time. But it is not necessary to set out on the face of the Bill all the details. The powers in the clause to make regulations and issue guidance are the right way of ensuring that the appropriate people and organisations are consulted. On that basis, I hope that the noble Baroness will feel able to withdraw the amendment.
Lord Rowallan: I make no apologies for once more standing up on behalf of the voluntary sector. Can the Minister give me an assurance that the money that goes into the pool will be available for all service providers, which must include the voluntary sector, and not just those that are affiliated to either the health or local authorities? Obviously that is an important issue.
Lord Hunt of Kings Heath: I assume the noble Lord is pointing to a situation where the health and local authority agree to pool funds. It would then he up to the managers of those joint funds to decide how that resource should best be spent. Whether we are talking about health improvement programmes or about the use of funds in this way, I expect voluntary organisations to play a full part in that process.
Lord Rowallan: Forgive me for coming back again. Surely if there is nothing written in the Bill and if those governing the pooled resources take the view that they do not want anybody else involved in that pool of money, that will leave the voluntary sector completely outside. Should not something be written into the Bill to ensure that that cannot happen?
Lord Hunt of Kings Heath: I hoped that I had made clear that in the whole process of partnership, health improvement programmes, developing joint initiatives and the pooling of funds, we expect the voluntary sector to play a full part in the deliberations that will take place. Indeed, I do not see how the kind of proposals being made here can be effective when it comes to developing services without the full involvement of the voluntary sector.
In relation to the issue of the money that has been pooled, it will be possible for that money to be allocated to the voluntary sector.
Baroness Thomas of Walliswood: I am not entirely satisfied with that reply. Some of the voluntary sector people who have made representations to us will also not be satisfied.

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It is particularly unfortunate that in his reply the Minister suggested that in some sense the voluntary sector would hold the National Health Service and the local authorities back in terms of their innovatory approach to joint working. In fact in many cases the voluntary sector is the most innovative in providing for new patterns of care. That was a particularly unfortunate statement.
Lord Hunt of Kings Heath: If the noble Baroness will allow me to intervene, I am sorry if I gave that impression. I did not mean to imply that the voluntary sector would hold back an innovative approach to working together, to developing health improvement programmes and providing joint services. Far from it. I believe that the NHS has learnt much from the voluntary sector about innovative approaches to health services. I spent a large part of my previous life in the health service encouraging strong development between the NHS and the voluntary sector.
I was trying to explain—perhaps badly—that in these new arrangements we are trying to establish a much more dynamic approach to working relationships between the NHS and its partners, statutory or voluntary. One does not want to see such dynamic relationships constrained by too many set, bureaucratic conditions. However, I assure the noble Baroness that it is our intention that the voluntary sector will play a very full part in the new arrangements.
10.45 p.m.
Baroness Thomas of Walliswood: I thank the Minister for that assurance. We shall have to read with great care what the Minister said in both his interventions and no doubt talk to the people who have pressed us on this matter. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments No. 151 and 152 not moved.]
Clause 24 agreed to.
Clause 25 [Joint consultative committees]:
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 153:
Leave out Clause 25 and insert the following new Clause—
JOINT CONSULTATIVE COMMITTEES
(". It shall be the duty of joint consultative committees constituted under section 22(2) of the 1977 Act to advise the NHS bodies and local authorities on the proper performance of their duties under section 21 above.").
The noble Baroness said: Once again this amendment picks up the whole issue of consultation and voluntary sectors. We are concerned at the loss of the statutory right for the voluntary sector to be represented—which is the result of the abolition of the JCC as a statutory requirement—coupled with the lack of provision in the Bill for alternative joint arrangements which would maintain this representation. As I have said, it is the issue that we have been banging on about for some time now.
The right of representation has been crucial in enabling voluntary organisations at the local level to influence decision making and resource allocation, and to work in partnership with the health and local authorities to develop more services appropriate to people's needs. It has acted as a basis for involvement by a wide range of voluntary organisations, including small groups, at all levels of joint health and social care planning.
The loss of the right of representation is a retrograde step. That goes against stated government intentions for greater voluntary sector and service user involvement in health and community care. It will reduce the capacity of voluntary organisations to operate as an equal partner within the statutory sector in delivering improvements in health and social care. We have therefore tabled the amendment to ask the Minister to consider, once again, whether the JCCs really do need to be abolished or whether they should continue to be maintained as statutory organisations. I beg to move.
Baroness Gardner of Parkes: Perhaps the Minister can tell us about that. I was not aware, having served on JCCs, that voluntary organisations had a statutory right to be there. Perhaps I never understood the position correctly. Maybe the Minister can clarify the point.
We have heard a lot about voluntary organisations. Of course, we are all very much in favour of such organisations and all that they do. However, "the voluntary sector" is a vague term. It comprises very large numbers of organisations. Such organisations seem to come and go. Some are long-established and unchanging; others are growing up, brand new and meeting new requirements overnight. I do not quite understand how there can be a statutory position and whether it applies to one or to many.
Lord Hunt of Kings Heath: I start by saying to the noble Baroness, Lady Gardner, that voluntary organisations have a statutory right of three places on JCCs.
From what I have said in the last few debates, I hope it is clear to Members of the Committee that I and the Government recognise that the voluntary sector has a crucially important role to play in the new NHS. However, I do not believe that the retention of JCCs is necessarily the way to reflect and underpin that role.
In the new NHS, health improvement programmes have been established as the key planning mechanism determining investment in services to improve the public's health. They include the contribution of both the voluntary sector and local government. Maintaining a separate planning mechanism for the voluntary sector and local government within a JCC concept would only increase bureaucracy, duplicate the planning process and maintain the isolation of these areas from the day-to-day work of the NHS. I recognise that JCCs have performed an important and valuable role in the past and that all members have made an enormous contribution, but to retain them would run against the spirit of partnership working we have adopted in this Bill.

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An important theme running through our discussions has been the rejection of simplistic structural solutions to allow local initiatives to flourish. The new flexibilities provided for in this provision will allow the NHS, local government and the voluntary sector to be involved in partnership working. When health improvement programmes are fully developed, they will be much more effective as a way of ensuring partnership because their scope will be much wider than that of JCCs.
For the first JCC that I attended, we had to hire a town hall to accommodate its 70 or so members. One remembers the bulk of paper! Although JCCs were a useful structure 20 years ago in getting health authorities and local government sitting together, almost for the first time, I believe that their time has come and is now past. On that basis, I hope that the noble Baroness will withdraw her amendment.
Baroness Sharp of Guildford: I thank the Minister for that reply. In the light of what he said, we accept that it is the intention of the Bill to replace the JCC framework with a wider and more flexible framework through the local health improvement plans. However, I repeat the point that I made earlier: where there is not a statutory obligation to consult, there is always the temptation not to do so. The old NHS was not good at involving other organisations in its planning. We look forward to seeing how the health improvement plans develop and we reserve the right to bring back at another stage the issue of the statutory right of the voluntary sector to some form of consultation. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 25 agreed to.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 154:
After Clause 25, insert the following new clause—
("Regional Assemblies
Upon a regional assembly being created for any region in England, such regional assembly shall for the purposes of the 1977 Act, the National Health Service and Community Care Act 1990, or under or by virtue of any prescribed provision of any other act, assume responsibility for—

(a) strategic planning,

(b) capital infrastructure, and

(c) specialised services commissioning,

in the health service in respect of such region.").
The noble Lord said: When my noble friend Lady Sharp starts referring to "banging on", I know that the hour is late. As we still have some important clauses ahead, I shall speak to my next two amendments quickly.
We know that the Government want, or are prepared, to create regional assemblies where there is demand for them. We have seen one outcome of that in terms of the Greater London assembly. In a sense, this is a probing amendment to see in which direction the Government are moving. No doubt, when the GLA Bill comes to this House we shall discuss the precise powers of that authority. Particularly in public health, the powers given seem extremely disappointing.
This amendment is an attempt to draw matters wider than public health. Regional assemblies should have a strong position with regard to the provision of health care in their regions in terms of strategic planning, capital infrastructure and specialised services commissioning, which subsumes the work of the regional office of the NHS. The amendment is designed to ascertain the Government's intentions in this respect. I beg to move.
Baroness Carnegy of Lour: I shall listen to the Minister's reply to this amendment with great interest because one understands that the regional assemblies are intended to be a counterbalance, among other things, to the Scots Parliament. The Government are requiring the Scottish Parliament to appoint 15 health boards to perform these the functions and not to do it themselves. We shall be coming to that issue in a later amendment, but it would be interesting to know whether the Government are consistent in their thinking.
Earl Howe: I have real difficulties with this amendment. The time to think about the role and functions of regional assemblies is when and if a Bill comes before parliament to set them up. I do not think one can look forward hypothetically in that Bill, as the amendment seeks to do, and imagine a whole structure of government that has not yet come into being.
More substantively, I disagree with the whole premise underlying this idea. It reeks to me of divided responsibilities and confused responsibilities. It also reeks of upheaval. Where does it leave primary care trusts, which will have responsibility for the activities mentioned in the amendment? Where will it leave health authorities, for that matter? I feel that, if you believe in a health service, you should leave the running of it to those whose profession and business it is to do just that.
Baroness Gardner of Parkes: I am very much opposed to the amendment. Having been a member of the Greater London Council, it would have been quite hopeless for us to have had that health responsibility. To find a health responsibility in London, you have to go back as far as the LCC, which existed prior to 1964. It would be a retrograde move and would be very damaging to the health service. I am opposed to the amendment.
Lord Hunt of Kings Heath: It is a nice try, my Lords, and it could best be described as an interesting, speculative amendment.
Since no regional assembly in England is in existence, and there is no legislation on the statute book to enable such an assembly to be established, there could be no question of our enacting a provision to confer any responsibilities on an as yet hypothetical body.
It is important, of course, to ensure close working relationships between the regional offices of the NHS Executive and other regional bodies, not least because of the important contribution that these bodies can make in terms of the wider strategic and economic

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responsibilities within a region, and the links between an economic situation and well-being and improving public health and tackling health inequalities.
I assure Members that the NHS and its regional offices will want to work constructively with the regional development agencies and regional chambers, as they already seek to do with the government offices of the regions. I think that is the appropriate course of action in relation to this issue. On that basis I hope the noble Lord will feel able to withdraw his amendment.
Lord Clement-Jones: I thank the Minister for that reply; at least he did not talk about my amendment reeking. I think it is a fairly odourless amendment. I thank him for his reply, as far as it went. It will be interesting when and if there is a Yorkshire assembly because people in Yorkshire will wonder why they have distinctly fewer powers than, say, a Welsh assembly on matters of health. No doubt we shall have many hours of debate in years to come. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 155:
After Clause 25, insert the following new clause—
("Specialised services: consultation
CONSULTATION IN RESPECT OF SPECIALISED SERVICES
Before arrangements to provide specialised services between an NHS regional office and the relevant providers are finalised, an NHS regional office shall ensure that the Primary Care Groups and Primary Care Trusts in the area covered by the relevant NHS regional office are fully consulted.").
The noble Lord said: I can be even more brief with this amendment. This is almost a cuckoo at this point in the Committee's proceedings. The Minister took us through the detail of specialised services to show how the pattern varies between different types of treatment and different specialties. However, the mechanics of the way the consultations are expected to take place between NHS regional offices and their primary groups and PCTs are still opaque, and elucidation in this area would be helpful. I beg to move.
11 p.m.
Lord Hunt of Kings Heath: I certainly recognise and support the intention behind this amendment; namely, that we should ensure proper engagement of primary care groups and primary care trusts in the commissioning of specialised services. Indeed, we went a step further, in that we laid down in The New NHS the important principles that all health authorities, primary care groups and primary care trusts should participate in these arrangements, and that those undertaking the commissioning should be accountable back to health authorities, PCGs and PCTS. The reason is clear: the arrangements need not simply to command the confidence of the clinical units concerned but also to be properly dovetailed into the commissioning of local services.
It follows from what I have said that I have some difficulty with the premise upon which the amendment is drafted. The Secretary of State has charged regional
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offices on his behalf with ensuring that there are effective arrangements for commissioning these services in each region, but they do not commission services themselves. The Secretary of State is already holding his regional officers accountable for ensuring that specialised commissioning arrangements more than meet the aims of this amendment. Therefore, on that basis, I hope the noble Lord will feel able to withdraw his amendment.
Lord Clement-Jones: I thank the Minister for that explanation. I shall consider quite carefully what he has said. There may be some elements in respect of which I do not fully understand the pattern, but the Minister's response was very helpful in terms of describing exactly what the regional offices are bound to do. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 26 [Powers relating to voluntary schemes]:
Earl Howe Earl Howe moved Amendment No. 156:
Page 21, line 16, leave out ("The Secretary of State") and insert ("A voluntary scheme").
The noble Earl said: In speaking to this amendment. I shall speak also to Amendments Nos. 157, 158, 159 and 175. There is difficulty with Clause 26(3) as drafted. This part of the clause empowers the Secretary of State to require manufacturers and suppliers who have signed up to the voluntary scheme to "record and keep" any kind of information and to provide that information to him. The difficulty is that these provisions are not limited to those obligations contained in the scheme itself; nor are they subject to any express obligation to consult the industry body on the scope of the information requirements.
I recognise that the wording of the subsection contains the qualifying phrase,
"which the Secretary of State may require for the purpose of enabling the scheme to operate",
but that is extremely one-sided. It is the Secretary of State who will have the power to decide what information he considers to be relevant. That, effectively, leaves the field completely open. That is a matter of concern, especially as the information powers will now be the subject of statutory penalties under Clause 30.
Therefore, the amendments I propose are quite simple. They seek to define the requirement to supply information by reference to the voluntary scheme itself, so that the provisions are automatically agreed with the industry. Moreover, under Amendment No. 175, I am also suggesting that there should be consultation with the industry about the regulations to impose penalties, so that those penalties can be considered at one and the same time as the voluntary scheme is negotiated. I beg to move.
Lord Walton of Detchant: In giving some support to this group of amendments, I should like to make a number of general comments relating to Clauses 26 to 31 as a whole, because these have given great concern to the Association of the British Pharmaceutical

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Industry. As I did on Second Reading, I must declare an interest as an occasional neuroscience adviser to a particular pharmaceutical company.
The problem is that an effective boundary needs to be established between voluntary and statutory schemes of regulation. The Bill ought to include objectives which reflect the needs of patients, the NHS, the UK pharmaceutical industry and the UK science base. Indeed, we shall be speaking to an amendment later which relates to provision being made for arbitration in disputes.
Similarly, it is important, as the noble Earl said, that there should be clarity as regards consultation and information required by government. The pharmaceutical industry should be regulated in line with best practice in other industries. But the Bill as it stands ignores such best practice, instead potentially threatening the future for the UK-based pharmaceutical industry. One company has pointed out that the UK is a leading country for pharmaceutical investment. Seven of the current top 25 medicines in the world are the result of UK research. One recently discovered medicine, olanzapine, for the treatment of schizophrenia, was discovered in the UK and has revolutionised treatment outcomes for this distressed patient group. It is now one of the best selling medicines in the world. Many companies believe that the current voluntary scheme has served both government and industry well since its inception. It has provided a stable base to maintain investment levels in R&D, and good value for the taxpayer.
There is an ever growing number of demand side controls on pharmaceuticals. The current NHS reforms, including unified budgets, NICE guidelines and national service frameworks, will continue the development of demand side controls. Many companies believe that supply side government imposed price and profit control is not the best way to proceed. They recognise the Government's need to address non-compliance under the voluntary scheme, but that non-compliance has in the past been limited to a small number of companies.
I trust that the Government will be able to assure the pharmaceutical industry that the voluntary scheme will continue and that the clauses in this Bill which potentially might lead to companies at present participating in a voluntary scheme having price controls imposed upon them will be withdrawn as the proceedings continue.
Baroness Cumberlege: I wish to speak to these amendments. I shall resist the great temptation to make a Second Reading speech. However, I wish to ask about something that was not available to us at Second Reading and which concerns the clauses we are discussing. We have in this House the impressive Select Committee on Delegated Powers and Deregulation. It is respected by your Lordships. Its deliberations are consistently thoughtful, wise and appropriate. I know that when I was a Minister I was extremely concerned to meet the requirements of that committee. Never have I known the committee so concerned and for it to use such direct language, urging the Committee to amend the clauses to prevent their bypassing primary
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legislation, and to put the Bill in proper order thus avoiding Henry VIII clauses. What does the Minister feel about the report, and how will she and her colleagues treat the considered and forthright advice given to them? At 20 minutes to 10 this evening the Minister the noble Lord, Lord Hunt of Kings Heath, said in relation to local authorities—I use his words directly—that it was the Government's intention "to use regulatory powers sparingly". If the Government are to use those regulatory powers sparingly in relation to local authorities, I wonder why the Government appear to be so punitive and dismissive of the commercial sector.
Baroness Sharp of Guildford: My name was attached to this series of amendments, I think mistakenly, although I have sympathy with some but by no means all of the proposals, as will become clear when I address the Question of whether the clause should stand part of the Bill. We on these Benches by and large do not believe it right to have statutory regulation of a voluntary scheme. By and large we support the amendments because they make the provision more of a voluntary scheme. Nevertheless, our preference would be to have the clause withdrawn completely from the Bill.
Baroness Hayman: There has been something of the flavour of a Second Reading debate about our discussion on these amendments although I make no complaint about that because we have moved on to an important area of the Bill which concerns the regulation of prices in the pharmaceutical industry. It is right that we should discuss Amendments Nos. 156, 157 and 158 which I shall discuss in a moment. The noble Earl, Lord Howe, also spoke to Amendments Nos. 170 and 175. I shall come to those in a moment.
Perhaps I may respond to two general points. I agree with the noble Baroness, Lady Cumberlege, that one should pay special attention to the Delegated Powers and Deregulation Committee. I said at Second Reading that we would look with care at its report. It made two main recommendations regarding the elements of the Bill on PPRS and statutory reserve powers for companies which were not compliant. One recommendation was that we should have affirmative rather than negative powers when regulations and directions are made under Clauses 26 to 29. I indicated to the Committee when we met last week that the Government accept that suggestion and will bring forward an amendment at an appropriate stage to take affirmative rather than negative powers. Equally, when we come later to a specific amendment on the issue of an appeals procedure—which was of concern to the committee—I can be helpful and will indicate what the Government will intend to do.
Perhaps I may respond to the comments of the noble Lord, Lord Walton of Detchant, about the value of a voluntary agreement. The noble Baroness, Lady Sharp, also referred to the general issue of the desirability of a voluntary rather than a statutory agreement. I reaffirm the Government's view that, in the main, the voluntary agreements that have existed for 40 years have been of great value. They have been to the benefit both of the

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industry and patients in the NHS, as represented by the Government. It is our intention—we are conducting negotiations at present—to continue that tradition. We hope that we shall reach agreement on another voluntary agreement that properly recognises fairness to the NHS in terms of the prices paid for medicines and is fair and reasonable to the pharmaceutical industry as the supplier. One would wish to take into account the need to recognise the very clear demands of funding on research and development that is very important both for the industry's success and the improvements in patient care to which the noble Lord referred. We are aiming to provide another successful voluntary agreement.
Although the noble Lord, Lord Walton, suggested that there had been very few areas of non-compliance, there are concerns that areas of non-compliance are increasing. Companies are failing to submit their financial returns by the due date to enable the Government to assess profit levels and are delaying the provision of information or delaying the repayment of excess profit. One major company has refused to submit financial returns since 1990 and has resisted all approaches to comply. Over the past year, 24 companies have increased product prices without the Government's agreement—at an estimated cost to the NHS of £30 million a year and at the expense of other NHS treatment and care.
There is a risk that if we do not take action to secure compliance, some of the companies that have so far complied properly will cease to do so. In addition, there are issues of transparency. The PPRS has been criticised by the Select Committee on Health, among others, for its lack of transparency. We need to consider that in the light of general government policy and indeed of European law. While we wish to retain a scheme of profit-capped regulation for a further five years and we hope to see that successfully and voluntarily negotiated with the pharmaceutical industry, we also need to have the levers necessary to ensure compliance. I think the noble Lord, Lord Walton, recognised that need.
The Government believe that Clause 26 provides a firm and clear foundation on which voluntary agreements will stand in the future. The voluntary scheme itself will determine what is required for its effective operation. Perhaps I may reassure the noble Earl, Lord Howe, by saying that we intend that the information required will be set out in the agreement which we are seeking to reach with the industry. However, I recognise the concerns that have been expressed that, as currently drafted, Clause 26(3) is perhaps very wide in terms of the information that could be sought. With the Committee's agreement, I should like to take that away and see whether we can come up with drafting that will suitably circumscribe the kinds of information that would be called for.
Perhaps I may deal also with the two amendments that are linked with Amendment No. 156. Amendment No. 158 also covers the information requirements of the voluntary scheme. It would remove from the face of the Bill the reason for information being required under the voluntary scheme. I believe that it is necessary to be
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explicit here and to make plain the reasons why companies will be required to record, keep and provide information. It would not be consistent with what I have just suggested on Amendment No. 156—to see whether we can provide additional clarity—to take on board Amendment No. 158, which would reduce that clarity. Therefore, I would urge the Committee not to pursue that amendment.
With regard to Amendment No. 157, as has been the case for the past 40 years, we envisage only one voluntary agreement to be in place at any one time. However, the term "a voluntary scheme" in Clause 26 (3), as in Clause 26(2), merely indicates that there will probably be a series of such voluntary agreements over the lifetime of the Bill rather than that there will be several specific agreements in place at any one time. Therefore, I do not think that that would be a sensible amendment to make.
Amendment No. 159 seeks to add the words,
"after consultation with the industry body".
I said earlier that we acknowledge the value to be placed on a voluntary agreement between the Government and the pharmaceutical industry. By definition, the content of a voluntary agreement will be decided only with the express consent of both parties to it; that is, the Government and the ABPI. It is therefore unnecessary to provide a further consultation with a body that has already subscribed to and chosen to join the agreement. So I do not think that that adds anything in terms of ensuring that the agreement is voluntary.
Perhaps I may deal with Amendments Nos. 170 and 175.
11.15 p.m.
Earl Howe: I am grateful to the Minister. I did not speak to Amendment No. 170 and I shall not move it.
Baroness Hayman: I am grateful to the noble Earl. I shall follow his example and not speak to it either.
Turning to Amendment No. 175, it is entirely proper that the industry body should be consulted over matters of detail relating to sales of medicines to the NHS. The setting up of the statutory scheme is already subject to contribution. These are matters on which the industry body can contribute.
The amendment as drafted may not be the best way of extending the consultation process. If the noble Lord and the Committee were content, I should like to take the matter away in an attempt to see whether we might produce a government amendment to introduce the consultation process in the setting of maximum prices.
On an issue of clarity, I should not have given my recollection of what the Select Committee said rather than read carefully what it had actually said. The committee did not in fact recommend the affirmative resolution procedure, as I mentioned in my response to the noble Baroness, Lady Cumberlege, other than for Clause 30(6). That is the area in which we should intend to bring forward an amendment in order to conform with the recommendations of the Select Committee.
Earl Howe: I am most grateful to the noble Baroness for her response. In the interests of brevity, I shall leave it at that. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 157 to 159 not moved.]
Earl Howe Earl Howe moved Amendment No. 160:
Page 21, line 32, at end insert—
("(5) Any dispute between the Secretary of State and a manufacturer or supplier to whom a voluntary scheme applies—

(a) in connection with or arising out of the scheme, or

(b) as to any addition or modification which should he made to the scheme pursuant to subsection (2)(b),

may be referred to arbitration or to the determination of an independent person or body in accordance with the procedures established in the scheme.").
The noble Earl said: This amendment, which I shall take with Amendment No. 176, needs only a brief comment but is extremely important.
As the Bill is drafted, there is no mechanism available to deal with disputes between a company and the Department of Health, either in relation to the requirements of the voluntary scheme or as regards the payment provisions under Clauses 27 and 28, or as regards the penalty provisions under Clause 30. I do not believe that that is equitable. Nor do I believe that it is in the interests of either the industry or the department.
The Minister mentioned at Second Reading, and again just now, that there were companies that were in breach of the existing PPRS, one for a number of years. We cannot go into detail about individual cases, but how much better it would be if there were a neutral arbitrator or tribunal available to resolve disputes of this nature. It would make both the company and the Department of Health much less inclined to be obdurate for long periods and would open up the prospect of disputes being settled more speedily. I hope that the Minister will be receptive to these proposals, as I believe she has hinted she will be. They are made in a genuine desire to see the PPRS working as we all wish it to do. I beg to move.
Baroness Sharp of Guildford: I support the noble Earl in his Amendments Nos. 160 and 176, and wish to speak to Amendment No. 174. This amendment, like the other two, might be described as a tidying up proposal. It applies to Clauses 28 and 29 relating to the setting up of a statutory price regulation scheme. Just as Amendment No. 160 calls for an arbitration scheme to be put into effect in the event of a dispute between parties to the voluntary scheme, so it is appropriate that there should also be an arbitration mechanism for any statutory scheme. Given the extensive powers that the Secretary of State will take upon himself under the establishment of any statutory scheme, equity demands ways of balancing interests. We must recognise that, however good the scheme, conflicts of interest and dispute will arise. It is necessary to write into the Bill clear dispute mechanisms as a requirement. From these Benches we support the amendments proposed by the noble Earl, Lord Howe, and I commend Amendment No. 174.
Baroness Cumberlege: I, too, support these amendments. The problem with the Government's proposals as they stand is that they give the
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pharmaceutical industry the feeling that it is not wanted. It is a global industry which can site its enterprises anywhere in the world. It will go where it feels wanted and respected. Indeed, in some places the pharmaceutical industry is even given sweeteners because it is recognised that the industry is a prize which is worth winning.
The Government have rightly placed an enormous emphasis on education. Those who are the brightest are employed by the pharmaceutical industry, a quarter of its employees being graduates. If we educate people in this country to a high standard but then offer them no jobs, we shall be educating people for emigration, which I think would be a very great pity. Anything we can do to make the industry feel wanted—and arbitration will clearly be a part of that, because it is a fair proposal—should be supported by the Committee.
Lord Walton of Detchant: I rise briefly to support these amendments. The ABPI has said clearly that it would have much preferred to see an effective boundary defined between the voluntary and statutory schemes on the face of the Bill, but it accepts that such a boundary could be introduced into regulations made under Clause 28. We seek the assurance of the Minister not only that the appeal mechanism and arbitration will be introduced but also that that boundary will be clearly defined in regulations.
Baroness Hayman: I hope I can be helpful to the Committee, both in what I say and the brevity with which I say it.
As far as the boundary between the voluntary and statutory schemes is concerned, there are amendments which deal with that matter, but I hope I can offer a way of making it clear that the statutory provisions will not take effect for those who agree to, and abide by, the voluntary scheme. Perhaps we can come to that point in a moment.
As regards these three amendments, which would set up an appeals procedure both for the voluntary scheme and for decisions made under the statutory scheme as defined in Clause 28 and regulations made under Clause 30 for enforcement, Members of the Committee correctly pointed out the need, to which the Select Committee on Delegated Powers and Deregulation also pointed, to set up an independent tribunal to ensure a process that is as speedy and open as commercial confidentiality allows. It has been suggested that I hinted that we might possibly want to do that. I say clearly that we intend to do it. I should be grateful for a little time to enable us to try to draft something which comprehensively covers the three areas which it is necessary to cover.
Perhaps I may say to the noble Baroness, Lady Cumberlege, that we have tried to meet the concerns of the ABPI on this and other issues. I should not like anyone to think that the Government's proposal to take what I believe is justified and justifiable action to ensure that there is compliance which gives equity, fairness and a reasonable price to the National Health Service in any way undermines our confidence in, and respect for, the contribution of the pharmaceutical industry in this

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country, which has been enormous. It is a world leader. It is an industry for which the department has a sponsorship role, which it is pleased to take on. It is an industry which has a considerable knowledge and research base, which is important to our economy, and nothing in these clauses should be taken as undermining our support for it.
Strictly speaking, companies under the voluntary scheme will be subject to statutory provisions—the process requirements under Clause 26—but not the statutory scheme under Clause 28. That was the distinction that I sought to make in replying to the noble Lord, Lord Walton. By definition, in putting a voluntary scheme on the face of the Bill one makes them in some way subject to statute. But I believe that the noble Lord understood what I said—at least I hope that he did.
Earl Howe: I thank the Minister for her constructive and helpful reply, which I am sure will be welcome news to the pharmaceutical industry. We look forward to seeing the amendments to be tabled by the Government at a later stage. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
11.30 p.m.
On Question, Whether Clause 26 shall stand part of the Bill?
Baroness Sharp of Guildford: We on these Benches believe that a voluntary scheme should be what it says it is: voluntary. In this regard it should not need statutory reinforcement. If the voluntary scheme does not work the Secretary of State may introduce a statutory scheme as set out in Clauses 27 to 29. But we are opposed to a hybrid scheme that confers on the Secretary of State wide powers to enforce the terms of a voluntary scheme. We believe that the voluntary price regulation scheme, which in one form or another has worked in this country since the late 1950s, has had very substantial benefits for Britain. In particular, it has helped to encourage the development of a research-intensive, innovative pharmaceutical industry as instanced by the fact that, as the noble Lord, Lord Walton, said earlier, seven of the top selling 25 drugs in the world were developed in British R&D laboratories.
Thanks to a price and regulation regime that has favoured innovative and research-intensive activities over "me too" drug production, the industry in this country is a leading contributor to the global market-place. Three leading companies—Glaxo-Wellcome, SmithKline Beecham and Zeneca (shortly to become Zeneca Astra)—are British-based, while other international companies such as Upjohn-Pharmacia have chosen to locate their headquarters here. Many leading manufacturers, including Merck-Sharp & Dohme, currently regarded as the world's leading research company in pharmaceuticals, locate substantial R&D facilities in the UK. These facilities feed upon one another. In total we have a considerable "clustering" of research activities attracted to the UK by the quality of
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the research base and the general environment in which the industry operates. But in its turn it provides jobs for high-quality graduates and research moneys that help to maintain the excellence of the science base in this area. It is a prime example of what all political parties claim they wish to see achieved in this country: a high productivity, high value-added industry.
As the Minister made clear, especially of late there have been a number of breaches of the voluntary agreement. In our view, it is up to the industry to make sure it delivers on its side of the agreement and up to the Government also to honour their promises, which notably in 1993 they failed to do. The industry should not have to rely on the Government to pull renegades into line. If the scheme does not work there should be a fully-fledged statutory scheme in its place. While we back the voluntary scheme we are unhappy about the degree to which it depends upon secret decisions made behind closed doors. We have therefore proposed—I shall speak to this later in the debate—that the Secretary of State should issue regular reports on his negotiations with the industry that describe in much greater detail than at present the outcome of the negotiations.
But I return to where I began. We do not think that the Government should legislate to enforce a voluntary agreement, and accordingly we do not believe that Clause 26 should stand part of the Bill.
Baroness Hayman: It is late in the day to discuss the semantics of whether or not this is a hybrid scheme. Perhaps I may respond briefly to the noble Baroness. I should like to reiterate that the Government are committed to renegotiating the pharmaceuticals price regulation scheme. Negotiations are currently taking place with the industry with the objective of achieving agreement. I believe that those objectives are shared by both sides of the negotiations. We as a government want them to be a success. We recognise what has been achieved over the years under previous agreements and we consider that another voluntary scheme is the best way to proceed.
However, I have to repeat that we need to take account of recent experience in operating the current scheme. That is what has led the Government to conclude that it will not be possible to operate the new scheme fairly and effectively without some means of addressing those companies that sign up to the voluntary agreement but then do not abide fully by the agreed terms.
I have explained what some of those difficulties have been in the past and the reasons why that situation brings both the administration and the efficiency of the scheme into disrepute and delays the payment of excess profits where they are payable under the scheme. That is not fair to companies which comply with the scheme. Nor is it fair to the NHS.
We do not believe that what we put forward is a hybrid scheme. We want to reach an agreement which will be voluntary and any other provisions about a statutory need to provide information would not affect

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the companies which signed up and abided by it because they would be working within the terms of the agreement. We believe that that is the best way forward.
However, experience of recent years has shown that not all companies which sign up to a voluntary agreement are then prepared fully to comply with it. My understanding from discussions with the pharmaceutical industry is that it recognises the justification for the Bill including provisions for penalties to give teeth to the obligations which companies will undertake under the terms of the voluntary PPRS. I suggest to the noble Baroness that the two alternatives that she proposes, as I understand, by opposing the Question that the clause stand part of the Bill—either for a voluntary agreement, which is susceptible to the same problems that we have had in the past; or to a full scale statutory scheme—are not the best way forward. It is sensible to recognise the value of a voluntary scheme but equally it is necessary to have the statutory underpinning which ensures that that scheme is effective.
We do not believe that it would be sensible for the Government to have to decide between continuation of a probable non-compliance by some companies and a full statutory scheme. Both those outcomes are less satisfactory than a voluntary scheme with which companies comply fully. That is the aim of the clause. I urge the Committee to support that it remain part of the Bill.
Baroness Sharp of Guildford: I thank the Minister for that reply. We beg to differ on the issue, but, given the lateness of the hour, I shall not pursue the point.
Clause 26 agreed to.
Clause 27 [Power to control prices]:
[Amendments Nos. 161 and 162 not moved.]
Earl Howe Earl Howe moved Amendment No. 163:
Page 21, line 40, at end insert—
("(2) The powers conferred in this section shall not apply to a manufacturer or supplier to whom a voluntary scheme under section 26 applies.").
The noble Earl said: We come now to an important set of amendments. I shall speak to Amendments Nos. 163 and 167.
Clauses 27 and 28 of the Bill came as a considerable shock to the pharmaceutical industry. The provisions in these clauses empower the Secretary of State not only to limit any price which may be charged by any manufacturer or supplier of health service medicines but also to introduce a statutory scheme under which prices or profits of manufacturers or suppliers would be compulsorily curbed in respect of any health service medicines.
Only a few months ago, in July 1998, the Secretary of State was quoted in the Pharmaceutical Times as saying:
"The PPRS delivers with no surprises and at the same time the UK is well below the international average on the cost of our drugs. I don't think we will be looking for any giant changes".
We have only to look at Clauses 27 and 28 to see how giant the changes are and how far the Government have altered course since July last year. What has brought
1506
about this dramatic change in the Government's position—so dramatic that they are effectively doing away with the voluntary nature of the PPRS by taking on powers to fix the prices of drugs as they choose?
The Government's justification for these new powers is that certain companies are not complying with the voluntary scheme. If that is really their perception, I believe that we need further and better particulars. We are told that one major company has refused to submit financial returns since 1990. If that is true, it is clearly unsatisfactory. However, there are at present 45 companies in the scheme and one problem case out of 45 hardly seems to justify the kind of power we see here. Indeed, on 26th November, the Secretary of State told another place that the reserve powers,
"should have no significant impact on the vast majority which always have complied and are complying at present".—[Official Report, Commons, 26/11/98; col. 332.]
But these powers could apply to the compliant majority. They are not limited reserve powers; they are sweeping powers. They would enable the Secretary of State to impose direct price and profit controls on individual companies, or on the industry as a whole. The Government in the Bill makes much of the spirit of partnership, but I have to ask where the spirit of partnership is in Clauses 27 and 28.
The clear understanding within the industry was that the new statutory powers were intended as reserve powers to back up the PPRS and that Clauses 27 and 28 would be held in reserve in the full expectation that their use would he unnecessary once the new voluntary PPRS had been agreed upon. Indeed, the Minister herself on Second Reading said:
"We consider that a voluntary scheme which is clear and fair is the best way of working".—[Official Report, 9/2/99; col. 113.]
She has repeated those sentiments tonight. How do the Government believe that a voluntary scheme can be successfully negotiated if the companies attempting to sign up to it are simultaneously threatened by the use of compulsion? That threat undermines the entire voluntary basis of the PPRS. What the Bill does is to place companies in double jeopardy and that is totally inequitable and counter productive.
If the Secretary of State and the industry reach agreement on a voluntary scheme under Clause 26, the companies which have agreed to take part in the scheme should be expressly exempted from compulsory controls of any kind. By that, I do not mean that there should be no sanction against those who break the terms of the PPRS. I see nothing offensive in principle about the provisions in Clause 30 for penalties on non-compliant companies. But what is completely unacceptable is the enactment of new compulsory powers of price and profit control which could operate indiscriminately against saints and rogues alike. And that is the purpose of the amendments. I beg to move.
Lord Walton of Detchant: I have already raised the issue of the boundary and it may well be that the Minister will say that this issue is to be dealt with under regulations. But looking at the wording of Amendment No. 167, to which the noble Earl referred, is it not possible that the Government could come hack with an amendment

1507
at Report stage indicating precisely on the face of the Bill that the statutory scheme will not apply to a manufacturer or supplier who is complying with all the provisions of the voluntary scheme? Would that not be a means of meeting the great concern of the industry on this matter?
Baroness Hayman: Yes, I believe that it would and that that is what we ought to do. With the leave of the Committee, I should like to see whether we can draft a provision which I agree with the noble Lord will be better dealt with on the face of the Bill rather than by regulation.
We have here three sequential clauses. We have Clause 26 dealing with the voluntary agreement; Clause 27 concerned with the control of prices; and Clause 28 intended to operate where there is no voluntary agreement or in relation to those companies or suppliers that fail to abide by the terms of the agreement.
The noble Earl, Lord Howe, was quite right to point out that the Government's intention has always been that the statutory provisions should have no significant impact on those companies which agree to and comply with the voluntary agreement. Amendment No. 163 underlines the Government's intention that the control of prices should not apply to manufacturers and suppliers who are abiding by voluntary schemes, as described in Clause 26. Amendment No. 167 makes clear that Clause 28 is to operate only in the case where there is no voluntary agreement or where companies or suppliers fail to abide by the terms of that agreement.
It is not our intention that any manufacturer or supplier abiding by the terms of the voluntary agreement to which Clause 26 refers should be subject to the powers conferred in Clause 28.
I believe that the boundaries to which the noble Lord, Lord Walton of Detchant, referred are not very clear on the face of the Bill, although I believe that we have been clear as to our intentions. Therefore, with the leave of the Committee, I wish to take away both amendments with a view to looking at how we may subsume their spirit and bring forward amendments at a later stage.
11.45 p.m.
Earl Howe: Once again, I am extremely grateful to the Minister for the constructive way in which she has responded to these amendments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 27 agreed to.
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 164:
After Clause 27, insert the following new clause—
ANNUAL REPORT BY SECRETARY OF STATE
(". The Secretary of State shall make an annual report to Parliament containing a general survey of developments during the preceding twelve months on the voluntary schemes including references to—

(a) any modification of an existing voluntary scheme or introduction of a successor voluntary scheme,

(b) decisions taken to prohibit price increases and collect payments under section 26(4), and

(c) decisions taken to control prices and profits under section 27.").

The noble Baroness said: This amendment picks up the issue to which I referred in my earlier intervention. The Secretary of State is answerable to Parliament and, through Parliament, to the electorate. If he is party to a voluntary agreement, he should be answerable to Parliament for his actions. At present, we know remarkably little about the deals done under the PPRS. It is a classic corporatist deal. Those on the Opposition Benches should be joining us in wishing to bring some of those dealings out into the open.
The amendment asks the Secretary of State to make an annual report on developments within the voluntary scheme and to report in detail on any modifications agreed. It is pursuing the agenda for transparency and open government which we have been pressing on the Government throughout the Bill. We hope that we are beginning to make an impact. I hope that the Minister will respond positively to that request. I beg to move.
Baroness Hayman: I hope that I can be helpful in terms of the spirit of what the noble Baroness seeks to achieve.
I accept her view that there have been criticisms of PPRS agreements in terms of their complexity and lack of transparency. Indeed, that was one reason that I put forward earlier for needing to make some changes. That is why we are trying to place the voluntary agreements and statutory schemes on a clear basis—to meet some of those criticisms.
I should say to the noble Baroness that the Government intend to publish reports to Parliament on the operation of both the voluntary and statutory arrangements. Much has been done with the first two reports which have already been published, although I hear what she says about not being satisfied completely as regards the detail of that. There are problems which we should acknowledge in respect of matters of commercial confidentiality. But certainly, aggregate figures should be made available and we should do what we can to meet that.
I would question whether it is sensible to place a requirement to publish an annual report on the face of the Bill. One can easily envisage circumstances over the lifetime of the Bill once it becomes an Act when it might be inappropriate in terms of timing to publish a report as described by the amendment. There may be a time when there is no voluntary agreement or when

1509
negotiations between the Department of Health and the industry body are at a late stage when the 12 months conies round.
It is in order to have flexibility that I suggest that it is better not to put the requirement for an annual report on the face of the Bill, especially when we look at the issue of a statutory scheme where it might be the case that only a small number of suppliers and manufacturers are affected in any given year. It could be only one or two. It would be very difficult in those cases to see how confidentiality could be maintained and the company's business affairs would be placed in the public domain against its will. One way around that might be found in aggregating the results over a longer period so that a report on the results of the statutory scheme was produced which did not breach areas of confidentiality. Again, we need some ability to act flexibly and responsibly to the conditions prevailing over the lifetime of this legislation. I can assure the noble Baroness that it is our intention to publish reports to Parliament on the operation of both the voluntary and the statutory schemes.
Baroness Sharp of Guildford: I thank the Minister for that very forthcoming reply. We would like to see something on the face of the Bill as a statutory requirement. However, in the light of the Minister's assurances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 28 [Statutory schemes]:
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 165:
Page 21, line 41, after ("State") insert ("for Trade and Industry").
The noble Baroness said: This is a minor amendment but is of some significance. As I have argued, we believe that there should be no hybrid scheme. There should be either a voluntary or a statutory scheme. This amendment relates to the statutory scheme. If it is to be introduced we believe that there is a conflict of interest between the position of the Secretary of State as a regulator and as a purchaser of health services. Essentially the statutory scheme, if introduced, is a piece of industrial policy about the health of the pharmaceutical industry. As such, we believe that the right Minister to act as intermediary is not the Secretary of State for Health but the President of the Board of Trade. I beg to move.
Earl Howe: I support this amendment. It is self-evident that if a statutory scheme were to apply the Department of Health would be both customer and regulator at the same time. That is not at all satisfactory. If we are to have a statutory scheme—I sincerely hope we do not—then there ought at least to be another department of government in charge of it, a department which can perhaps take a wider and more dispassionate view of the issues involved.
Baroness Hayman: This amendment arises perhaps from an unnecessary broadening of the Government's overall purpose in terms of any statutory scheme. Our purpose, as indeed with the voluntary scheme, is to
1510
ensure that the prices paid by the NHS for its medicines are fair and reasonable both to the NHS and the pharmaceutical industry. It is not the purpose of the Bill to regulate the operations of the pharmaceutical industry beyond that aim.
I have said several times this evening that we hope to proceed in this matter by co-operation under a voluntary agreement, but it is clear that circumstances might arise where a statutory scheme would need to be introduced. Clause 28 is concerned with the making of such a scheme. It is a matter for the Secretary of State to determine after appropriate consultation. After all, he is the purchaser of medicines for the NHS and it is his concern that those medicines are priced reasonably and fairly.
The Secretary of State for Health has a key interest in maintaining close contact with the industry in its role of ensuring best value for money as purchaser as well as seeking to maintain an industrial policy within the UK which encourages development of innovative medicines and treatments. Acting as a sponsor commits the Secretary of State for Health to maintain a sensitive and broad perspective as regards developments and concerns within the industry which will, in turn, impact on the provision of healthcare through the NHS.
The amendment will place that responsibility with the Secretary of State for Trade and Industry, whose concerns are not with the NHS. Furthermore, once the Secretary of State for Trade and Industry has made a statutory scheme, it will then fall to the Secretary of State for Health to introduce it under Clause 28. I suggest to the Committee that cannot be a sensible course of action.
I have to say also, simply in terms of drafting, that there is the issue of naming Secretaries of State in primary legislation. That is most unusual and, where it has occurred in the past, has led to confusion and uncertainty as to responsibility when departments have merged or split. Therefore, I suggest to the noble Baroness that that is one good reason for the all-purpose term, "Secretary of State" rather than being more specific in the legislation. However, that is, perhaps, a technical point.
Although I understand where the noble Baroness was coming from on the amendment, I believe that this is not a matter of regulation of the industry as a whole. This is very specifically about ensuring fairness under any statutory agreement that might need to be introduced. I suggest that putting responsibilities for part of that with the Secretary of State for Trade and Industry would not help.
Baroness Sharp of Guildford: I thank the Minister for the answer. As we know, the Department of Trade and Industry has been empire building very hard and it is possible, of course, that it might at some time merge with the Department of Health, although one would hope not to see that! We may think about this at a later stage, but, in the light of the Minister's reply, I beg leave to withdraw the amendment.
Noble Lords: No!
11.57 p.m.
On Question, Whether the said amendment (No. 165) shall be agreed to?
Their Lordships divided: Contents, 8; Not-Contents, 28.

Division No. 1

CONTENTS

Addington, L.

Howe, E.

Bumham, L. [Teller]

McNair, L.

Clement-Jones, L.

Mar and Kellie, E.

Henly, L. [Teller]

Sharp of Guildford, B.

NOT-CONTENTS

Ahmed, L.

Hardie, L.

Amos, B.

Hayman, B.

Archer of Sandwell, L.

Hoyle, L.

Bach, L.

Hughes of Woodside, L.

Carter, L.[Teller]

Hunt of Kings Heath, L.

Desai, L.

Macdonald of Tradeston, L.

Donoughue, L.

McIntosh of Haringey, L.[Teller]

Falconer of Thoroton, L.

Monkswell, L.

Farrington of Ribbleton, B.

Palmer, L.

Gilbert, L.

Pitkeathley, B.

Gordon of Strathblane, L.

Ramsay of Cartvale, B.

Gould of Potternewton, B.

Sawyer, L.

Grenfell, L.

Sefton of Garston, L.

Hacking, L.

Walton of Detchant, L.

Resolved in the negative, and amendment disagreed to accordingly.
12.4 a.m.
[Amendments Nos. 166 to 168 not moved.]
Lord Lucas Lord Lucas moved Amendment No. 169:
Page 22, line 31, at end insert—
("( ) The Secretary of State shall publish within seven days details of any payments made under subsections (4) and (5) above.").
The noble Lord said: In moving to move Amendment No. 169 I shall speak at the same time to Amendment No. 179. My main interest is to hear the Minister's explanation of the Government's view of publishing this sort of information in the way my amendment suggests. I am not clear from what was said in relation to a previous amendment whether the names of those who default under the current voluntary scheme are made public. If they are not, I would be interested to know why. Thinking of the future, it would be thoroughly desirable if the Government's decisions under these two clauses were published. I beg to move.
Baroness Hayman: Clause 28, to which Amendment No. 169 is directed, among other things provides for the repayment of unreasonable profits made from the sale of medicines to the NHS or extra income derived from those sales gained by a price increase not agreed by the Secretary of State. It is the basis of a statutory scheme which is to operate when suppliers and manufacturers are not covered by a voluntary scheme.
1512
The amendment seeks to make details of payments under a statutory scheme public within seven days of their receipt. I agree that the effects of a statutory scheme are of genuine interest to many parties, but I can see absolutely no point in requiring the information to be made available piecemeal and at high speed in the way that the amendment proposes. I can think of no precedent for such a requirement, and also there is the need to respect the commercial confidentiality of suppliers and manufacturers. This is an important principle and the amendment could result in its breach. We shall be making available aggregated details of the operation of both the voluntary schemes, including repayment, but we do not think it is appropriate to have to do that within seven days.
In response to the noble Lord's specific question, the names of companies not complying with the scheme have not been made public, with commercial confidentiality being cited as the main reason.
Amendment No. 179 requires the Secretary of State to publish directions given to a supplier or manufacturer about the operation of statutory schemes in individual cases.
Clause 31(1) allows the Secretary of State to make regulations generally, or to give directions to a particular manufacturer or supplier. It is constructed in this manner for a specific purpose: it allows the Secretary of State to deal with a particular supplier or manufacturer in a manner which respects commercial confidentiality.
I recognise that the amendment seeks to achieve greater transparency, but I suggest to the noble Lord that it would defeat the object of respecting commercial confidentiality by placing in the public domain matters between the Secretary of State and a particular supplier or manufacturer about that company's professional and financial affairs. We do not believe that that is the right way forward. Therefore, I hope that the noble Lord will feel able to withdraw his amendment and accept the details of what I gave him when we discussed the earlier amendment; namely, that we will be making available aggregate details of the operation of both the voluntary and the statutory schemes.
Lord Lucas: I thank the Minister for her reply, but I do not find her answer satisfactory. After all, when the Ministry of Defence reaches an agreement with a supplier which results in that supplier paying a substantial amount of money back because of overcharging, or whatever it may be, the common practice is for the identity of that supplier to be made public. Can the Minister give me an example of what sort of considerations of commercial confidentiality apply where a supplier has been misbehaving itself to the extent that the Government have taken action under one of these two clauses? Can she give an example where it would be reasonable in all the circumstances, and taking into account the public interest, not to publish the name of that supplier?
Can the noble Baroness say how commercial confidentiality applies to such things as the actual cost of manufacturing a particular medicine, or the details of what has gone on behind the scenes? The fact that a

1513
manufacturer has transgressed and has been fined, say, half a million pounds, is surely not a matter to which any commercial confidentiality can apply without stretching that concept to an extent which would make a freedom of information Act—if we ever see one from this Government—entirely unnecessary because there would be no freedom.
Baroness Hayman: Rather than chance my arm at this stage of the proceedings by producing an example which might be flawed, perhaps the noble Lord will allow me to consider that and his analogy with the MoD and write to him on both issues.
Lord Lucas: Of course I will. The noble Baroness has been extraordinarily generous, not only to me but also to other Members of the Committee. That is a great compliment to her as a Minister and has made listening to these proceedings a great delight. I doubt that I ever behaved as well as she has when I served on the Front Bench. I should certainly be grateful for that consideration. I am sure that the noble Baroness understands the point that I am making here. I look forward to receiving that letter in due course, and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 28 agreed to.
Clause 29 [Statutory schemes: supplementary]:
[Amendment No. 170 not moved.]
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 171:
Page 22, line 33, after ("body") insert ("and bodies representing consumers and patients").
The noble Lord said: Clause 29(1), says:
"The Secretary of State may, after consultation with the industry body, make any provision he considers necessary or expedient for the purpose of enabling or facilitating—

"(a) the introduction of a statutory scheme, or

"(b) the determination of the provision to remain in a proposed statutory scheme".

The purpose of my amendment is to elicit from the Minister why other bodies, especially consumer and patient bodies as well as the new national institute for clinical excellence, will not be involved in that process. It seems rather exclusive simply to have consultation with the "industry body" when what is a significant step—that is, the setting up of a statutory scheme—takes place. I beg to move.
Baroness Hayman: I understand the spirit in which the noble Lord puts forward this amendment. I am sure he will be aware that we have made it absolutely clear in most responses that the Government intend to consult the representatives of patients, users and carers of the service. We have not done so here because, in terms of taking on a statutory scheme, it would be the technicalities of a scheme which set out to achieve fair and reasonable prices. In turn, that would give full regard to the needs of patients and consumers. The important issue for patients is that they continue to have access to the medicines indicated in their treatment. In considering this issue I am sure that the Secretary of
1514
State will listen to the views of patient groups. However, I do not believe that there should be a requirement to consult on the technical issues of a statutory scheme either with the national institute for clinical excellence—whose remit in this area is not clear—or with representatives of patients and consumers. A statutory scheme would be concerned with the prices paid to the NHS.
I understand that the noble Lord will say that that in turn influences the amount of money that is available for other forms of care and is, in the broadest sense, of interest to patients and consumers. I do not disagree with him on that and I think the broad framework of such an agreement is something on which patient groups may wish to put forward their opinions. However, a statutory scheme would be concerned specifically with prices paid by the NHS and would be a matter for the Secretary of State as purchaser and the industry body as the representative of the suppliers.
In that case I think it is proper that we put on the face of the Bill the duty to consult with those suppliers who would be subject to the workings of a statutory scheme. However, I am not certain that it is appropriate to refer on the face of the Bill to consultation on what, as I say, is essentially the technicalities of price setting within the pharmaceutical industry. I hope therefore the noble Lord will feel able to withdraw his amendment.
12.15 a.m.
Lord Clement-Jones: I thank the Minister for that reply. I am not quite sure that she has addressed the point of whether NICE would have information on the technicalities of any statutory scheme. Over a period it will build up an enormous amount of expertise in the whole area of drug pricing and so on. However, the hour is late and I shall ponder the Minister's reply before the next stage of the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 172 not moved.]
Baroness Sharp of Guildford Baroness Sharp of Guildford moved Amendment No. 173:
Page 22, line 37, at end insert—
("( ) In exercising any powers or negotiating any price under or by virtue of any provision of this Act, the Secretary of State shall have regard to the priorities of the NHS for research and development in the field of pharmaceuticals.").
The noble Baroness said: This amendment reiterates the point that has already been made in the debate. It asks that any statutory scheme of price regulation that is introduced shall take account of the importance of research and development to this industry. As I stressed earlier, we have succeeded in "growing" in this country an extraordinarily successful and innovative pharmaceutical industry. It is a highly profitable industry but a good part of its profits are reinvested. The average cost of bringing a new drug to market these days is over £250 million. This is a vast sum and the industry deals in vast sums.
In setting prices, the Government must recognise that the industry has to have this level of resources at its disposal. If they do not do so, there is a great danger

1515
that we shall lose this extraordinarily successful research-based industry from which this country currently benefits a great deal. I beg to move.
Earl Howe: I wish to speak to Amendments Nos. 178, 180, 181 and 182. One of the standard features of recent legislation giving government the power to control the prices and profits of a particular industry is a section setting out a clear statement on the face of the Bill of the objectives which underlie these powers. An example of this is Section 3 of the Electricity Act 1989. If we look at this Bill, however, the powers are there but the context is not. Indeed the powers proposed in the Bill are far more discretionary than the statutory powers which apply in industries such as the privatised utilities. With the privatised utilities the power to control prices rests effectively with an independent regulator. The Bill should state in clear terms the Secretary of State's obligation to have regard to defined statutory purposes in exercising the powers confered upon him. These purposes ought best to be a restatement of the objectives underlying the PPRS. That is what Amendment No. 178 seeks to achieve.
Statutory control of the prices and profits of private companies is very much a course of last resort for any government—even, I suspect, for this Government. Clause 31(4) of the Bill attempts to hedge in these powers by including a test of reasonableness. But, on reading that subsection, I wonder whether the wording could be made clearer and more direct. I have attempted to do that in Amendments Nos. 181 and 182. In Amendment No. 180 I have suggested that there ought to be exactly the same test of reasonableness applied to anything the Secretary of State does under Clause 26 relating to the voluntary scheme.
Baroness Hayman: I hope I can be helpful to the Committee, although I am not certain that I can accept specifically either the amendment of the noble Baroness, Amendment No. 173, or the later amendments, as they stand, of the noble Earl, Lord Howe. Amendment No. 173 would place on the face of the Bill a requirement for the Secretary of State to have particular regard to the priorities of the NHS for research and development in the field of pharmaceuticals in the exercise of any statutory scheme. The purpose of the statutory scheme—as is the purpose of a voluntary agreement—is to ensure that the prices paid by the NHS for its medicines are fair and reasonable. As I have said before, deciding what is a fair and reasonable price is a process involving many factors, one of which is the amount of profit made by suppliers and manufacturers from the sale of medicines to the NHS.
However, it is not the only one. The amendment points to the importance of research and development to pharmaceutical products. That importance has long been recognised by the NHS. In the pharmaceutical industry the cost of that research and development is high and is met from profit. It is reasonable to take account of research and development costs because the NHS ultimately benefits from the supply of safe, effective and innovative medicines. I assure the Committee that the
1516
recognition of the importance of research and development will continue in the event of the introduction of a statutory scheme. I am not sure that it is necessary to have such a commitment on the face of the Bill. The Secretary of State, in not having regard to the importance of research and development in setting prices and profits would be acting against the long-term interests of the NHS.
Amendment No. 178 is a similar but more comprehensive amendment proposed by the noble Earl, Lord Howe. It raises a number of questions. First, there is the issue of whether it is desirable to have a statement of objectives on the face of the Bill. This is a difficult matter requiring some care. It runs the risk of the objectives being followed so closely that they restrict the operation of the Bill and make it unworkable. There is also the issue of whether it is desirable to give a separate set of objectives to one part of the Bill with the statutory scheme, and potentially other objectives set out in the voluntary scheme, which is not yet decided upon.
The objectives proposed, as they are laid out, seem perfectly acceptable principles—I would not wish to dissociate myself from any of them—but we would he setting the courts a near impossible task if we were to ask them to consider not simply whether a company's profits were in accordance with the rules of the scheme but whether the Secretary of State's actions could be considered best calculated to achieve the objectives set out here.
It is vital that we work on a co-operative basis with the pharmaceutical industry, and we hope that this co-operation will be through a voluntary agreement. It is in that agreement that a statement of objectives, such as those proposed, should reside. They are then capable of change in the light of changed circumstances and renegotiation. I do not believe that it would help to have an inflexible statement of objectives on the face of the Bill if they were subsequently relied on as a key to the operation of the legislation.
However, I have some sympathy with regard to the issue of whether we could find a way of placing on the face of the Bill some general principles against which a Secretary of State would work in drawing up a statutory scheme. I hesitate to say that I am certain that we will be able to do that—because of the difficulties in the proposals before us—but I am certainly happy to take this away to see whether we can do something that is perhaps more specific than the reference to be reasonable in all the circumstances to which the noble Earl, Lord Howe, referred and which is, I have to accept, fairly broad.
We shall look to see whether we can produce something that would not introduce possibly excessive scrutiny of the operation of what is intended to he a light touch scheme but something that more clearly defines general principles and general circumstances. Perhaps I may take this away and see whether we can bring something forward at a later stage.
Baroness Sharp of Guildford: I am most grateful to the Minister for her very forthcoming reply. In the light of what she said, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 174 not moved.]
Clause 29 agreed to.
Clause 30 [Enforcement]:
[Amendments Nos. 175 and 176 not moved.]
Earl Howe Earl Howe moved Amendment No. 177:
Page 23, line 15, at end insert—
("( ) An order under subsection (6) shall be laid before both Houses of Parliament in draft and shall be subject to approval by resolution of each House.").
The noble Earl said: Clause 30 lays down penalties for infringements of any of the regulations or directions which may arise from the preceding four clauses covering either the voluntary scheme or the statutory controls that may be imposed by the Secretary of State. This amendment is concerned not with the principle of having penalties but with the power of the Secretary of State to increase those penalties without further reference to Parliament. This is a Henry VIII power and it is one about which the Delegated Powers and Deregulation Committee expressed particular concern.
I strongly share that concern because, even setting to one side for a moment all our disagreements about statutory versus voluntary schemes, it seems wholly wrong for Parliament to give a blanket power to the Secretary of State to enable him to set literally any amount as a penalty. I do not believe that that kind of power exists in law in respect of other types of fine or penalty. Nor do I see any argument for it existing here, more especially because these penalties apply not just to the infringement of the statutory controls but to the voluntary scheme as well. I beg to move.
Lord Clement-Jones: We on the Liberal Democrat Benches strongly endorse the comments of the noble Earl, Lord Howe, and support the amendment. As he mentioned, it was strongly recommended by the Delegated Powers and Deregulation Committee and we believe that there are eminently good reasons for making subsection (6) subject to the affirmative procedure.
12.30 a.m.
Baroness Hayman: It is certainly our hope that the powers conferred under Clause 30(6) would not often be used over the lifetime of the Bill. The provision is there to ensure that the penalties for non-compliance with either the voluntary agreement or the statutory scheme should remain at appropriate levels.
Noble Lords are correct in pointing out their own view and that of the Delegated Powers and Deregulation Committee that provisions such as these should be made by affirmative resolution. I referred earlier to our intention to bring forward amendments at a later stage to bring the Bill into line with the suggestions made by the Select Committee. Perhaps this is one of a number of areas in the Bill in which that could be done.
Perhaps the Committee will allow me just a moment's leeway, for the sake of completeness, to deal with other government amendments which it may be helpful to foreshadow that we intend to bring forward. I made
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reference earlier to issues surrounding unified budgets. We also want to bring forward an addition to the section of the Bill dealing with evasion of charges and fraud to cover the introduction of a penalty charge for non-payment of an NHS charge or the incorrect claiming of a benefit. That would respond to the recommendations of the efficiency scrutiny on fraud published in June 1997.
I also hope, in response to the point raised by the noble Lord, Lord Colwyn, at Second Reading, to bring forward a government amendment on the issue of professional indemnity insurance and to introduce an amendment responding to concerns raised by the professions relating to the role of local medical and dental representative committees in relation to primary care Act pilots. I am grateful to the Committee for allowing me to make that clear as well as our intentions in relation to this amendment.
Lord Monro of Langholm: Will the noble Baroness make it clear that the affirmative resolution will apply to all of Part II relating to Scotland as well?
Baroness Hayman: I am not sure that I can make that crystal clear at this precise moment. We shall come to the provisions for Scotland shortly. As I understand it, the recommendation of the Select Committee and this amendment in particular deal only with Clause 30(6). Perhaps before we come to debate the Scottish provisions I can find out and respond to the noble Lord at that point.
Earl Howe: I am extremely grateful, as so often this evening, for the noble Baroness's constructive approach. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 30 agreed to.
[Amendment No. 178 not moved.]
Clause 31 [Controls: supplementary]:
[Amendments Nos. 179 to 182 not moved.]
Lord Desai Lord Desai moved Amendment No. 182A:
Page 23, line 32, at end insert—
("(4A) In carrying out his duties under subsection (4), the Secretary of State shall publish criteria setting out what factors should be taken into account in determining prices and profits which would be reasonable in all the circumstances.
(4B) Prior to publishing the criteria referred to in subsection (4A) above, the Secretary of State shall consult such organisations as he considers appropriate.").
The noble Lord said: I shall be brief as this matter has partly been discussed. The amendment proposes that the Secretary of State should publish the criteria as to how he decides whether prices and profits are reasonable. It seeks to clarify the situation.
There is another problem that should be mentioned. According to the annual report of the Department of Health, the PPRS is meant both to secure cost-effective medicines for the NHS and to promote the pharmaceutical industry. There may be problems of conflict between the two. I am not sure which hat my right honourable friend the Secretary of State for Health

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would wear in deciding one against the other. This is a probing amendment. I hope that my noble friend can give me a satisfactory answer at this late hour.
Baroness Hayman: I am grateful to my noble friend for the clarity and brevity with which he proposed the amendment. I believe he is right to point out that there will he judgments to be made in the objective of securing an agreement that is fair and reasonable both to the NHS as purchaser and to the industry as suppliers and manufacturers. I believe that it will he difficult but not impossible to do so. Previous schemes have managed to square that circle and I hope that the current negotiations will result in a scheme which both parties feel satisfies the need of the NHS for medicines at reasonable prices and of the industry for a reasonable profit base, not least for the reasons of supporting research and development to which reference has been made.
The amendment affects the Secretary of State's use of powers conferred under a statutory scheme. Such a scheme will be used where a voluntary scheme does not exist or where a company fails to abide by the terms of that agreement. Subsection (4) confines those powers to making any decisions by reference to the prices or profits which would be reasonable in all the circumstances. The amendment puts on the face of the Bill a requirement that the Secretary of State shall consult appropriately before deciding and publishing the criteria to be used in determining what prices or profits would be reasonable in all the circumstances.
In the event that the powers are exercised to provide for a statutory scheme of profit control, the statutory scheme would be entirely set out in regulations. Those regulations would have to be very detailed and formulaic and would contain the criteria to which the noble Lord, Lord Desai, referred. The Bill already provides for consultation with the industry body before the power is exercised and the Secretary of State is free to consult other bodies as he sees fit.
On the question of price control, the Secretary of State will again have to consult the industry body before exercising any power. He is also required to act reasonably, as required by general law and Section 31(4) of the Bill. To do so, a clear statement of the criteria which had been used in determining any price would be required. I hope that my noble friend will feel that the effects which the amendment seeks to put in place are already met, if not on the face of the Bill, in the regulations that would have to be made in the exercise of this power, and that on that basis he will feel able to withdraw the amendment.
Lord Desai: I am grateful to my noble friend for that very clear exposition. I need only add that among the organisations that the Secretary of State should consult should be some consumer organisations. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 183 and 184 not moved.]
Earl Howe Earl Howe moved Amendment No. 185:
Page 24, line 3, at end insert—
(""the supply of any health service medicine" means the supply of a health service medicine to the health service,
"the manufacture of any health service medicine" means the manufacture of such health service medicine as may be supplied to the health service.").
The noble Earl said: I believe that there is a problem with the definition of "health service medicine" in Clause 31(6). I take it that the Bill intends to limit the exercise of the powers contained in Clauses 26 to 31 to medicines actually supplied to the NHS. As drafted, however, the definition of "health service medicine", which is,
"a medicinal product … used to any extent for the purposes of the health service",
leaves open the possibility that the controls would apply to such a medicine even when it was being supplied to someone other than the NHS. In other words, it would, as a product, be subject to the controls, no matter whom it was sold to. Amendment No. 185 attempts to put the issue beyond doubt by including two new definitions in Clause 31. I hope that the Government will be receptive to them. I beg to move.
Lord Clement-Jones: I wish to indicate the strong support of these Benches for the amendment. The clause as currently drafted is too wide. The amendment specifies the area that the clause is meant to cover, which I am sure is the Government's intention.
Baroness Hayman: Both noble Lords have expressed concern about the breadth of the current definitions within this part of the Bill. Clauses 26 to 31 are concerned with the single aim of ensuring that the prices paid by the NHS for its medicines are fair and reasonable. We are not concerned to control prices or profits on the sales of private medicines. However, at the margins, particularly when dealing with wholesalers, the precise destination of every drug in any particular consignment is very difficult to identify. That is the problem in limiting the scope of the price and profit control powers created under the Bill to medicines sold to the health service rather than to categories of medicine that are used to a significant extent by the service. But the problem to which I have alluded arises under the present voluntary arrangements that have operated satisfactorily.
I recognise that something may be required to deal with this marginal problem, but I suggest to the Committee that it may be best dealt with in regulations. Perhaps I can look at whether there is a way of doing that. There are problems in the suggested amendment which would have equal and opposite difficulties in the clause as it is phrased at the moment.
Earl Howe: I am grateful to the Minister for indicating that she will give further thought to the issue. I realise from her response that it is not as clear-cut as I had thought. Nevertheless, there is an ambiguity in the wording which perhaps can be removed by a little

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judicious rephrasing. We can perhaps look forward to returning to this matter at a later stage. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 31 agreed to.
On Question, Whether Clauses 32 to 35 shall stand part of the Bill?
Baroness Hayman: Perhaps I may take this opportunity before I sit down—if that is the appropriate way to put it—to respond to the noble Lord, Lord Monro of Langholm, on the question of the affirmative procedure and Part II of the Bill and the proposals that we make in Clause 36. This is a reserved matter and therefore will apply to Scotland. Clause 36 has no bearing on Part II of the Bill nor indeed on any of the Clauses 26 to 31. I hope that that deals with his point.
Clauses 32 to 35 agreed to.
Clause 36 [Repeal of law about fund-holding practices]:
[Amendment No.186 not moved.]
On Question, Whether Clause 36 shall stand part of the Bill?
Lord Monro of Langholm: Perhaps one should take this opportunity to debate Clause 36 which, after all, represents a major change in the health service in Scotland. It removes the capability of fundholders. I believe that some explanation from the Minister is required as to the reasons for the inclusion of this provision in the Bill over and above what is in the White Paper. It is unfortunate that Part II of the Bill is being considered at 12.45 in the morning. This makes very substantial changes to the health service in Scotland. This is hardly the time to discuss such important issues. While I appreciate that fewer general practitioners in Scotland than in England undertook fundholding, I believe that fundholding has been a success in terms of what they have been able to achieve: less interference in general practice; a reduction in bureaucracy; less impact on costs; easier prescribing under fundholding; and the ease of organisation of entry into hospital. Before we say goodbye to fundholding as provided for in Clause 36, the Minister should be able to put forward a good case for this major change.
I am grateful to the noble Lord, Lord Macdonald, for the trouble he has taken in writing to us this afternoon setting out in more easily understood English the more complicated changes to the Bill under the Scottish draftsmanship. That is appreciated. I am sure that all who read it in the future will wish that the Bill had been drafted in similar terms.
Having offered those words of thanks, perhaps when the noble Lord, Lord Macdonald, replies, he will argue a case for Clause 36.
12.45 a.m.
The Earl of Mar and Kellie: In discussion with my local health board I gained the impression that the few fundholding GPs had already accepted that the writing
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was on the wall. In view of the advanced state of preparations for implementing the Bill by 1st April, fundholding has virtually come to an end.
The Minister of State, Scottish Office (Lord Macdonald of Tradeston): I am grateful for the contribution by the noble Lord. He makes the case strongly that there are different circumstances in Scotland from the circumstances which existed in England. In England, 50 per cent. of GPs were standard fundholders in April 1997, with a further 7 per cent. in community fundholding. Similarly, in Wales, 47 per cent. of GPs were standard fundholders, with a further 6 per cent. in community fundholding.
However, in Scotland, although about 50 per cent. of GP practices had joined fundholding by 1998, more than 30 per cent. were in the primary care purchasing scheme, the Scottish equivalent of community fundholding, but less than 20 per cent. as standard fundholders. In Scotland the new structures that we are building will be on the same principles as those in Wales and England. They will provide strong organisational support for the development of primary care and will involve local doctors and nurses in planning and influencing the high quality of services for patients.
Members may ask: why then the difference? The difference in the two models reflects the different starting points in Scotland compared with England and Wales, as well as the differences in culture and historic structure of the National Health Service. For example, purchasing of secondary services by GPs was much less widespread in Scotland, where the majority of GPs who had joined fundholding were community fundholders. There are also substantial parts of Scotland with rural and dispersed populations such as the Highlands and Orkney, the Shetlands and the Western Isles, where competition between providers was never really a reality. In Scotland we have a different situation and it deserves different treatment.
I turn to Amendment No. 186. We have made a clear commitment to end the internal market and replace it with modern arrangements founded on the principles of partnership and co-operation. Clause 36 abolishes the GP fundholding system which formed a major part of the old internal market. The regulations were laid on 17th February to bring the existing GP fundholding schemes in Scotland to an end on 31st March. A single remaining form of fundholding will operate from then until all fundholding is abolished, as we intend, through the provisions of this Bill. Clause 36 enables us to remove this remaining form of fundholding, which we intend to do as soon as practically possible. Fundholders recognise that it is now time to move on. We believed that it is important not only to signal the end of GP fundholding as swiftly as possible, but also to ensure that transitional arrangements are in place for as short a time as possible.
Clause 36 agreed to.
Lord Mackay of Drumadoon Lord Mackay of Drumadoon moved Amendment No. 187:
After Clause 36, insert the following new clause—
ALL SCOTLAND HEALTH BOARD
(".—(1) Section 2 of the 1978 Act (health boards) is amended as follows.
(2) In subsection (3) after "order", in the first place it occurs, there is inserted "create an all Scotland Health Board or".").
The noble and learned Lord said: In the absence of my noble friend Lord Mackay of Ardbrecknish, in whose name the amendment stands, I rise to move it. In doing so, I preface my remarks with a view I know is shared by my noble friend; namely, to raise once again the general observation as to why a Bill containing the clauses to be found in Part II is being brought forward to this House on the very eve of devolution.
Having read the debate on Second Reading, I am well aware that the point was raised then by my noble friend, but I am not sure that the answer he received stands up. The answer was to the effect that the new primary care trusts will come into being on 1st April and need a full range of powers to do so. The legislation was necessary to bring that about. Whatever may come into being by 1st April 1999, one thing will certainly not; that is the Health Act 1999 based on the provisions which are to be found in the Bill currently before the Committee.
There is no possibility whatever that the Bill will have completed its parliamentary passage by that date. Therefore, the justification put forward on Second Reading, initially by the noble Lord, Lord Ewing of Kirkford, and subsequently adopted by the noble Baroness the Minister, does not hold water. If primary care trusts are to require some legal basis for their existence at 1st April 1999—and I do not dispute that that may prove to be necessary—they will not find it as at that date in the provisions of the Bill.
I have already referred to the fact that the Bill is brought forward on the eve of devolution coming into effect. As Members of the Committee will be aware, elections to the Scottish Parliament are due to take place on 6th May. All the parties have selected—in some cases, more accurately, appointed—those who are to stand as candidates at the election. Manifestos are being drafted; teams of election spokesmen are being appointed; and, I suspect, we are not far away from an embargo being placed on Scottish Office Ministers making any further official announcements or taking part in any further official visits in the immediate run-up to the election. Yet, here we are debating a Bill dealing with a major reorganisation of the National Health Service in Scotland. It is being considered initially by your Lordships' House and then in the fullness of time by another place.
From my reading of the Bill, the debate on Second Reading, the White Paper and surrounding documentation, I perceive nothing urgent in the subject matter of the clauses which requires the Bill to be enacted to include Part II. We will return to this matter, no doubt in somewhat greater detail, when the Committee comes to consider Amendments Nos. 219, 220 and 221.
The sharp political issue is that, if and when Part II becomes law, becomes part of an Act of Parliament, there may well be in position in Scotland a Scottish executive which is not composed entirely of members of the Scottish Parliament who are supporters of the present Government. It seems to me to be entirely wrong to place legislation on the statute book with no guarantee whatever that the people who will fall to bring it into effect and to implement it are full-blooded subscribers to the policy which lies behind the legislation.
There is also considerable force in the point made a few moments ago by my noble friend Lord Monro as to the lateness of the hour at which we are discussing this important issue. There is a certain irony in that one of the justifications for devolution, which I recognise has some force to it, is that it should do away with the need to discuss important legislation in the middle of the night. And yet here we are, on the very eve of devolution, doing that very thing and likely to be doing so, as I understand it, for not a little time yet.
Amendment No. 187 is a probing amendment which seeks to explore whether it is certain that there will always be a need to keep more than one health board in Scotland for individually defined geographical areas within Scotland.
In moving this amendment, I take the opportunity to renew the thanks of my noble friend Lord Monro to the Minister, the noble Lord, Lord Macdonald, for responding positively to the request made by my noble friend Lady Carnegy of Lour on Second Reading. She asked for a Keeling Schedule, which—possibly for understandable reasons—has not been made available. But the documentation which has been produced has certainly assisted in considering these amendments and in arguing them before the Committee.
As some Members of the Committee may be well aware, there is in fact in existence a statute law database but it is available only to parliamentary draftsmen and officials. Therefore, when one is in opposition, trying to scrutinise legislation, one is to some extent at a disadvantage. That disadvantage has been removed substantially by the extremely helpful co-operation which government Ministers have given in relation to the question that was raised.
It is clear from information made available to my noble friend Lord Mackay of Ardbrecknish that the Government propose to introduce two types of NHS trust in Scotland—the acute hospital trust and the primary care trust. It would be sensible to have a review of the boundaries and the number of health boards. One reason for the BMA putting forward this suggestion is to enable consideration to be given to the development of managed clinical networks, a concept which the Minister will be aware was discussed in a paper issued on 9th February of this year by the NHS Management Executive in Scotland.
As the Minister will know, managed clinical networks are defined as being linked groups of health professionals and organisations from primary, secondary and tertiary care working in a co-ordinated manner unconstrained by existing professional and health board

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boundaries to ensure equitable provision of high-quality clinical services throughout Scotland. If they fail to be introduced, there may well be an argument for restricting dramatically the number of health boards, possibly to a figure as low as one.
The amendment in the name of my noble friend Lord Mackay of Ardbrecknish seeks to amend the existing provisions of Section 2(3) of the 1978 Act to make it clear on the face of the statute that the figure could be reduced to a figure as low as one.
Some Members of the Committee may feel that that is a somewhat dramatic option to place in the hands currently of the Secretary of State but, come 1st July, it will be in the hands of the First Minister. Those Members of the Committee who were present on Second Reading or who have read the Hansard reports of the debate will be aware that the noble Lord, Lord Ewing of Kirkford, went one step further and argued very cogently at col. 148 for the abolition of all health boards from the scene. He justified his argument on a number of grounds, including a substantial saving in cost and also, by virtue of his experience as chairman of a health board, his view that strategic health planning, healthcare for the future, can be carried out over much wider areas than has hitherto been possible under the system of health boards.
Whether or not one agrees with the noble Lord, Lord Ewing, there is clearly a case to be made for the First Minister to be given power to restrict the number of health boards dramatically, possibly to one or possibly remove them altogether. This amendment will provide that the first option is clearly stated on the face of the statute. I beg to move.
1 a.m.
The Earl of Mar and Kellie: My noble friends are keen to move health into the care of local government. However, I look forward to hearing the Minister's explanation as to why we should not have one health board for Scotland, or indeed none at all, and instead have a situation where all the hospital trusts and primary care trusts report directly to the Scottish Minister for Health.
Lord Monro of Langholm: The noble Earl, Lord Mar and Kellie, is about the only chap in this building who thinks that health should be put entirely in the care of local government. As the Minister who introduced area health boards in 1972 when we reorganised the health service in Scotland into a single-tier system, which has worked well ever since, I shall be sorry to see them go. But what worries me is that we are setting up under the area health board an acute and primary care trust. It will devolve its powers into the co-operatives for managing the practices. One begins to wonder what the area health boards are going to do. I have been told that they will be there for the grand issues of long-distance planning and finance but that day-to-day management of the health service in any one area will be in the hands of the acute and primary care trusts.
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What worries me in relation to the amendment is the sheer geographical size of Scotland. For instance, the area health board in my area stretches from Gretna Green to Stranraer and from the Solway Firth right the way up to Sanquhar and Kirkconnel. It is a huge area, enough for any organisation to run a health service within it. To think that that health hoard might stretch over the whole of Scotland fills me with some degree of awe.
The Minister must justify what each area health board is going to do within the current health board areas and what its relative operation control will be over the trusts and the co-operatives to be set up under the present Government's plans. Frankly, I feel we are setting up an extremely bureaucratic situation that is going to be of no advantage to the poor patient who is there to receive the benefits of the health service and at the end of the day we will ask why on earth we have gone through this enormous somersault and reorganisation of the health service in Scotland which is entirely unjustifiable.
Baroness Carnegy of Lour: Briefly I must add my voice to protest at the way the Government are treating Scotland. It is now one o'clock in the morning and we are discussing an enormously important part of the Bill which turns the health service in Scotland upside down. We are doing it when it should be the job of the Scottish Parliament, as my noble and learned friend said.
My noble and learned friend mentioned the speech of the noble Lord, Lord Ewing. He is not in his place; I do not believe he has been here today so presumably he does not wish to pursue this matter. However, he pointed out that in Fife, the health board costs £6.1 million per year. That, by my calculation, is a middle-sized health board. It is one of 15, so it may well be that the running costs alone of the health boards are something of the order of £90 million. That is a lot of money. As the noble Lord, Lord Ewing, stated, the health boards will have two roles: they will be bankers, allocating money from the Scottish Parliament to the trusts in their area, and they will do strategic planning, which is easy to do nowadays on a larger scale.
The noble Earl, Lord Mar and Kellie, who, I believe, aspires to be a member of the Scottish Parliament, can see the Scottish Parliament wanting to do that job. I could see his eyes sparkling at the idea, and he will not be alone. Would the Government not be right to make that possible? I support the amendment.
Lord Macdonald of Tradeston: I am glad to hear that Members of the Committee opposite found the information that we were able to supply of some use to them. It was with great humility and diffidence that I offered guidance in these matters to the noble Lord, Lord Monro, or even to the noble Lord, Lord Ewing, well versed as they are in Scottish Office matters.
I take the point too made by the noble and learned Lord, Lord Mackay. However, I believe that we are due to have a debate on the devolution provisions on Thursday. Perhaps I may say to the noble Baroness that I do not think it is entirely the doing of this side of the House that we are still here at five past one. However, I should like to take in some of the points raised by the

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noble and learned Lord, Lord Mackay. I want to make clear that the Bill does not represent a sudden rush to try to get proposals through before devolution. On the contrary, it sets the seal on a process which has been going on since before we took office.
Many of our changes have been achieved within existing legislation. Those include reducing the number of National Health Service trusts in Scotland to 28; introducing co-operative mechanisms to promote partnership through the development of health improvement programmes and the setting up of the clinical standards board for Scotland to assure quality.
The provisions in the Bill deal only with those few matters where the law needs to be changed; that is, formally abolishing GP fundholding; enabling the appropriate National Health Service trust to take responsibility for family health services under Part II of the 1978 Act; changing trusts' financial arrangements; and imposing a duty of quality on the National Health Service in Scotland.
The proposals come as no surprise. They were all signalled clearly in our manifesto at the 1997 general election. They were set out in detail in our White Paper, Designed to Care published in December 1997. The National Health Service in Scotland is already building on them.
I turn to the amendment. There is nothing in the existing Section 2(3) of the 1978 Act to stop the Secretary of State creating an all-Scotland health board should he wish to do so. The noble Lord has set out what he believes would be the advantages of such a step, but I am not convinced. The Government believe that health boards continue to have a key role in bringing a local dimension to the planning and commission of services.
The national perspective is provided by the management executive of the National Health Service in Scotland. It is difficult to see how a pan-Scotland health board and the management executive could sensibly co-exist. I am surprised that the Bill, and the arrangements set out in Designed to Care, should be read as bringing about a reduction in the role of health boards. The White Paper is about making clear the different roles within the National Health Service.
In broad terms, health boards are responsible for strategy and planning. National Health Service trusts are responsible for the delivery of services. That takes forward, in a constructive way, the distinction between the two roles introduced in 1991. Health boards have a number of specific roles which are of great importance to the health and well-being of the populations. Apart from distributing resources to trusts, they are responsible for assessing the health needs of the local populations.
As the recent White Paper, Towards a Healthier Scotland, also pointed out, health boards are responsible for protecting and improving the health of the resident populations in promoting public health issues and ensuring fully co-ordinated community care policies. Health boards work closely with local authorities. The Government are anxious to encourage working across the boundary between health and social care. The effect
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of delivery of healthcare often depends on the active co-operation of other agencies, especially local authority social work departments.
Whatever structure we adopt, some boundary will exist. The important principle must be that the patient's care comes first, and the patient should not be aware that there is a boundary. To achieve this, the National Health Service in Scotland and local authorities need to develop close working relationships, and we are consulting on this aspect. The paper, Modernising Community Care: an Action Plan was published last October. It emphasises better and faster decision-making and caring for people in their own homes. Any changes thought necessary will be a matter for the Scottish Parliament. Health boundaries must not act as constraints on the care provided for patients. There is increasing emphasis on designing services from the patient's perspective, and the re-design of services to suit the needs of the patient does not allow health board boundaries to get in the way.
A further example of the work of the acute services review, which reported last June, and one of the fundamental assumptions, was that the review should not be constrained by health board boundaries. Its key recommendation is the development of managed clinical networks and anticipates that many of these will operate at regional and national levels. Just as people want to be treated locally if possible, I believe that they also want services planned at a local level where it makes more sense to do so. Health boards have the expertise to assess the needs of the local populations.
I have sought to explain why the Government take the view that a single health board covering the whole of Scotland is not appropriate. Nevertheless, as I mentioned at the start, there is nothing in the existing legislation to prevent a future government making that change if they choose. It will of course be open to the Scottish Parliament to consider the number of health boards and their role. The amendment is therefore unnecessary, and I hope that the noble Lord will not press it.
Lord Mackay of Drumadoon: I am very grateful to the Minister for his full explanation. I fully accept two of the main points he made. These proposals have been heralded for some time. A number appear in the Labour Party manifesto, some in the White Paper. However, as he rightly says, this is probably more a matter for debate on Thursday, and also the fact that they have come too late. However, there is force in the final point he makes that the legislation as drafted could be construed as allowing the Secretary of State by order to vary the number down to one. With that assurance from him that the Government accept that that is the correct construction of the existing legislation, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 188 not moved.]
Clauses 37 and 38 agreed to.
Clause 39 [Constitution of NHS trust boards]:
Lord Mackay of Drumadoon Lord Mackay of Drumadoon moved Amendment No. 188A:
Page 31, line 3, after ("trust)") insert (", at least two of whom shall be a registered medical practitioner and a registered nurse or midwife,").
The noble and learned Lord said: Amendment No.188A seeks to amend Clause 39 to provide that Section 12A of the 1978 Act would have additional words inserted to the effect that at least two of the executive directors, that is, directors who are employed at the trust, shall be in the first instance a registered medical practitioner and a registered nurse or midwife. The amendment was tabled by my noble friend Lord Mackay of Ardbrecknish after consultation and has the full support of the Royal College of Nursing.
The purpose of the amendment is quite clear: it is to ensure that health professionals, including a registered medical practitioner and a nurse or midwife, are represented at executive level on each of the National Health Service primary care trusts and acute hospital trusts in Scotland.
If acceptable to your Lordships, the amendment would enshrine in statute the commitment by the Government that there should be a nurse director as one of the executive directors on the board of each of the trusts. The matter is dealt with in a number of places in the White Paper. Page 12 indicates that the Government are committed to giving clinicians who work in the hospitals, along with those who use their services, a bigger say in management.
Clearly the amendment fits in with the manner in which the policy is described. When one turns to Section 5 of the White Paper, Designed to Care, the text makes it clear in a number of places that one aspect of the Government's policy is to involve, to a greater extent than is said to be occurring at the moment, those involved in the delivery of clinical services in the arrangements set down for managing them.
Perhaps I will be forgiven if I restrict what I quote from the White Paper to what is to be found in paragraph 75 of the section which deals with primary care trusts. This refers back to the emergence of new collaborative working methods and the benefits that they bring to patients and practitioners alike and says that,
"primary and community health services will be brought together under a single unifying structure in the form of Primary Care Trusts. The establishment of these Primary Care Trusts will build on the strengths of general practice and give a voice to community nursing and other primary care professionals managing and delivering care to their local communities. In this way primary care will be able to pool resources, work across organisational boundaries, and develop shared aims and objectives which will underpin the drive towards better quality of care for patients".
As I said, in view of the lateness of the hour, there is no great need to review in detail what is said in other paragraphs in the White Paper, especially in the section dealing with acute hospital trusts.
The main point to be made in support of this amendment is, as I have already mentioned, that the Government have given a commitment that there will be a nurse executive director on each primary care trust and acute hospital trust in Scotland. If that commitment has
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been given—as it has—it seems entirely logical that the same should apply to a registered medical practitioner. Therefore, the amendment was tabled by my noble friend Lord Mackay of Ardbrecknish to give the Government the opportunity to fulfil that commitment and to give it statutory recognition in legislation which, as I understand it, the Government propose should be available for the Scottish executive to implement once it is elected in May and takes up its executive responsibilities on 1st July.
If the Government do not accept this opportunity, that might involve their sending a most unfortunate signal not only to the health professionals in Scotland but also to the people in Scotland as to whether or not their word can be trusted in health service matters. I beg to move.
1.15 a.m.
Lord Monro of Langholm: I have two points on the trusts that I should like to put to the Minister. First, this Government seem to have got themselves into an inflexible position over the Peach/Nolan recommendation on appointments to public boards, bodies and quangos. Can the noble Lord tell me what the position is over the trusts and the area health board; and, indeed, the co-operative? For example, do those bodies have to go through the Peach/Nolan recommendation of having three recommendations for each appointment? That would mean that you would have to have 36 names for a 12-member health board in order to choose 12. Further, who will put forward the recommendation and does it apply to the chairman appointed by the Secretary of State?
Secondly, the information paper that we have recommends one co-operative to a health board. However, does the noble Lord really appreciate the size of these co-operatives in the geographical sense that I indicated in terms of my own Dumfries and Galloway health board? We should bear in mind that there will be a number of professionals on the body. I refer to general practitioners. Will they have time to tour these huge areas attending bureaucratic meetings and to manage these co-operatives? That requires skill and time and will cost a lot of money. Will the Minister answer those two points?
The Earl of Mar and Kellie: I am a little concerned that particularly as regards the primary care trusts the amendment gives undue influence to doctors, nurses, registered nurses or midwives. The allocation of two of the five posts to those professions strikes me as unfair on dentists, pharmacists, optometrists, health visitors, district nurses and mental health staff. Does the Minister agree with me on that?
Baroness Carnegy of Lour: I presume the Minister will tell us that nurses and medical practitioners will take part in the co-operatives and that therefore the Government are not obliged to say that they will have to be executive directors of the primary care trusts. However, we are told that a commitment has been given to nurses. If the Government do not intend to put that on the face of the Bill, why not? That is the question the Minister has to answer.
Lord Macdonald of Tradeston: As the noble and learned Lord, Lord Mackay of Drumadoon, has

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explained, his amendment seeks to ensure that nurses and doctors are on the National Health Service trust boards. I hope I can satisfy him on this matter. The White Paper, Designed to Care, signalled our intention to modify the existing arrangements with regard to National Health Service trust boards as part of the modernisation of the National Health Service in Scotland.
Provision for the broad composition of a board is set out in the 1978 Act. This sets out that the board consists of directors, including a chairman appointed by the Secretary of State, and executive and non-executive directors. We specified that non-executive members, or trustees as we would now like to call them, should be representative of the community as a whole rather than representative of a single staff group. Membership of trust boards is specified by secondary legislation and this allows for a greater degree of flexibility in the future, if it is necessary. That would allow change in the composition of a board. Currently every trust board must include a medical practitioner and a registered nurse or midwife. We have no intention of changing that. The Government obviously set great store by the contribution of nurses and doctors but a difficulty would arise if that led to other groups seeking similar treatment. We believe that could lead to excessive rigidity.
The noble Lord, Lord Monro, asked how the Nolan rules might apply to appointments to health boards. I do not have an immediate answer on that point. In principle I believe that such appointments probably will be subject to those rules. Indeed the Scottish health service arrangements were probably seen as some kind of model for the Nolan rules. However, as I understand the position, the local healthcare co-operatives are not subject to the Nolan rules because they are co-operative groups of independent GPs and are part of the management structure of the primary care trusts.
As regards whether GPs have time to manage the co-operatives, the Government have provided packages of support to release GPs from other duties. It is our belief that the positive response that we have had so far from the medical community in Scotland shows that people, perhaps having weighed those options, have decided that this is not just a workable but also an attractive proposition. I hope that with the reassurance I have given, the noble and learned Lord will feel able to withdraw his amendment.
Lord Mackay of Drumadoon: I am grateful to my noble friends Lord Monro of Langholm and Lady Carnegy of Lour for their support in this matter. I am also grateful to the noble Lord the Minister for his explanation of the Government's position. Far from reassuring me, the explanation gives me further cause for concern. If, as the Government point out, this is dealt with as a matter of secondary legislation and they have no objection in principle or policy to the amendment, there does not seem to be any good reason why the commitment that was given should not be honoured and entrenched in primary legislation, which, as the Minister will be aware, is far more difficult to change than secondary legislation. The noble Earl, Lord Mar and Kellie, raised whether other
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health service practitioners should be included in the primary legislation. It is entirely a matter for him whether he wishes to table an amendment to that effect at Report stage.
Lord Hughes of Woodside: If these two professions were placed on the face of the Bill, would it not in future prevent other professions being added as directors?
Lord Mackay of Drumadoon: Not as I understand the current legislation, which was explained to us in the letter sent by the Minister for which we are grateful. But the fact that on the face of primary legislation it is necessary to have two types of health service professionals as executive directors does not preclude, as I understand the law, the Secretary of State or the First Minister bringing forward an order which also required chiropodists, dentists or whomsoever to be on the board; nor does it prevent such people being appointed, whether or not they are mentioned in primary or secondary legislation. Therefore I have to say to the Minister that I find his response unsatisfactory and I shall seek to test the opinion of the Committee.
1.27 a.m.
On Question, Whether the said amendment (No. 188A) shall be agreed to?
Their Lordships divided: Contents, 2; Not-Contents, 29.

Division No. 2

CONTENTS

Henley, L. [Teller.]

Mackay of Drumadoon. L. [Teller.]

NOT-CONTENTS

Addington, L.

Hacking, L.

Ahmed, L.

Hardie, L.

Amos, B.

Hayman, B.

Archer of Sandwell, L.

Hoyle, L.

Bach, L.

Hughes of Woodside, L.

Carter, L. [Teller.]

Hunt of Kings Heath, L.

Clement-Jones, L.

Macdonald of Tradeston, L.

Desai, L.

McIntosh of Haringey, L.

Donoughe, L.

[Teller.]

Falconer of Thoroton, L.

Mar and Kellie, E.

Farrington of Ribbleton, B.

Monkswell, L.

Gilbert, L.

Pitkeathley, B.

Gordon of Strathblane, L.

Ramsay of Cartvale, B.

Gould of Potternewton, B.

Sawyer, L.

Grenfell, L.

Sefton of Garston, L.

Resolved in the negative, and amendment disagreed to accordingly.
Lord Mackay of Drumadoon Lord Mackay of Drumadoon moved Amendment No. 189:
Page 31, line 6, at end insert—
("(2) In section 12A of the 1978 Act (NHS trusts), after subsection (3) there is inserted—
"(3A) The chairman and trustees of every NHS trust shall, on appointment, be resident in or employed in the area covered by the trust."").
The noble and learned Lord said: Again I rise to move this amendment in place of my noble friend Lord Mackay of Ardbrecknish. It seeks to probe the

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Government and elicit from them details of their policy as to how well connected with the local area covered by a particular health service trust, whether a primary care trust or an acute hospital trust, the non-executive directors of the trust—namely, the trustees, who include the chairman—must be. In replying to the previous amendment the Minister touched on the connection between the non-executive directors and the local community—not that they formally represent members of the community, but that they should have a connection with them.
As presently drafted, Clause 39 seeks to amend Section 12A of the 1978 Act in the terms to which I have drawn attention. It is obviously unnecessary that this amendment should cover executive directors; by definition they are employed by the National Health Service trust concerned and are therefore employed in the area for which the trust has responsibility.
I trust that the Government will not dispute the importance of non-executive directors being seen to act on behalf of the people who live and work in the area in respect of which a trust has responsibility. That is seen to be their primary role, as it were, rather than becoming too involved in the day-to-day management of the provision of healthcare services, which is a matter for the professionals who are employees of the trust, whether or not those professionals also be executive directors.
Such identification with the needs of the local people is important. Those who work or reside in an area are the potential patients of a trust. It is appropriate, and indeed necessary, to have on that trust people who will speak and argue on their behalf rather than take a particular position on behalf of the employees of the trust, whom other people are there to represent.
It seems to me, and it certainly seemed to my noble friend Lord Mackay of Ardbrecknish, that Section 12A of the 1978 Act, if it is to be amended as the Government propose by Clause 9, would benefit from an amendment which required the chairman and non-executive directors, the trustees, to be either resident in or employed in the area. I beg to move.
Lord Monro of Langholm: I support my noble friend in his amendment. So far as I am aware, the chairmen of area health boards would live in their own areas. That could, however, be difficult in the central belt of Scotland, where one is domiciled to the headquarters of one's health board. In the more rural areas that was always the case, certainly when I set up the original health boards.
Although 1st April is only about four weeks away, the Minister is not aware of how new members are to be appointed to trusts or to the board. I know from experience, as I am sure does he, that it sometimes takes months to obtain the appropriate appointments to boards and trusts, going through all the formalities and the careful and diplomatic soundings beforehand. It seems to me that if area health board chairmen or members of boards or trusts are about to be appointed, the Minister should have a great deal of information in the pipeline. Yet he is not aware whether or not he has to invoke the
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Nolan recommendations. I hope that before we finish the debate tonight he can go a little further with regard to what the position will be in four weeks' time.
Baroness Carnegy of Lour: It may well be that in central Scotland, as my noble friend said, it is not very easy to keep membership to those living within the border of each trust. But the point is important. My research tells me that quite a number of current non-executive directors of trusts tend to "go native" and become so absorbed into the system that they begin to act like professional administrators and are therefore not as good a foil as they should be to those administrators. If they knew that they had to live in the area and therefore were speaking for the area and their minds were addressed to working entirely within the boundaries of the trust, that should help. I hope that the Government are interested in the amendment.
The Earl of Mar and Kellie: If this new statutory requirement were to be put on the face of the Bill, I should prefer it to say that the chairman and trustees should be "domiciled in" rather than "resident in". "Domiciled" means that it is their first and main home, whereas "resident" could refer to a convenient pied-à-terre, which would defeat the purpose of this statutory requirement.
Lord Macdonald of Tradeston: In reply to the noble Lord, Lord Monro, as I said earlier, I believe that the Scottish health boards have been something of a model for the noble and learned Lord, Lord Nolan. I can confirm that health boards and trusts are subject to Nolan and that people have been appointed to new trusts under the Nolan principles.
The noble and learned Lord, Lord Mackay, has explained his wish to ensure that there should be proper representation on all the boards. We accept that there should be strong links between those appointed to a trust board and the community which the trust primarily exists to serve. Geographical considerations such as this are already a fundamental part of the appointment process, as has been acknowledged. We have achieved much of what the noble and learned Lord wants without the need for legislation, and I am sure that that will continue to be the case in future.
However, a trust often provides services to a wider catchment population than lives in its immediate vicinity. That is particularly true where a trust provides services from a hospital located near the boundary of a health board. The amendment could have the effect of denying the trust the services of the best candidate for the job simply because he or she does not reside or work in the trust's area and is not prepared to take up residence there.
The example of the acute hospital trusts in Glasgow perhaps makes the point most clearly. From 1st April there will be two acute hospital trusts in Glasgow, one providing services primarily in the north of the city, the other providing services primarily in the south. In many respects they will be complementary. Patients from all over Glasgow and indeed from outside the city will be treated in both trusts. I am sure that the noble and

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learned Lord does not want potential trustees in Glasgow—especially the original proposer of the amendment, who lives in the lovely, leafy south side of Glasgow—to have to uproot themselves from north of the Clyde to south of the Clyde or vice versa. I repeat that the Government have every sympathy with the principle behind the noble and learned Lord's amendment but, for the reasons I have given, I hope he will not feel the need to pursue it.
Lord Mackay of Drumadoon: Once again, I am very grateful to the Minister for his response. He clearly accepts the general principle which lies behind the amendment, but he makes the valid point that there are practical problems when a hospital is located near a boundary. My noble friend Lady Carnegy of Lour also has reservations as to whether it would be appropriate for such a provision to be on the face of the Bill. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 39 agreed to.
Clause 40 agreed to.
1.45 a.m.
Lord Mackay of Drumadoon Lord Mackay of Drumadoon moved Amendment No. 190:
After Clause 40, insert the following new clause —
LOCAL HEALTHCARE COOPERATIVES
(". In Schedule 7A to the 1978 Act, after paragraph 13 there is inserted—
"13A. If no local healthcare cooperative has been set up in any part of an NHS trust's area, the trust shall have power to set one up and keep it in place."").
The noble and learned Lord said: Amendment No. 190 seeks to insert a new clause into the Bill and by virtue thereof to add provisions to Schedule 7A to the 1978 Act to the effect that,
"If no local healthcare co-operative has been set up in any part of an NHS trust's area, the trust shall have power to set one up and keep it in place".
Local healthcare co-operatives are discussed and described in the following terms on page 42 of the Explanatory Notes to the Bill:
"These will be voluntary networks of GPs and other primary care professionals working together to plan and provide primary and community health services and provide support for general practice. Local Health Care Co-operatives will be established from April 1999 as part of the management structure of primary care NHS trusts … and will draw their powers and functions from these trusts. They do not therefore require separate legislative provision".
I have already referred to the practical problem that may arise if this legislation is not in force by 1st April of this year. Clearly, it will not be in force then, and I do not repeat what I said earlier. But I seek to probe the Minister on two general lines. First, why should the setting up of these networks be an entirely voluntary exercise on the part of GPs and other primary care professionals who work in a particular locality? If the idea of the networks has merit and they are designed to play an important role in a reorganised National Health Service in Scotland, why is power not given to an NHS
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trust—in particular the chairman and directors—to set one up if it believes that it is to the benefit of the people to whom it has overall responsibility for the provision of healthcare? Secondly, how can such a voluntary organisation have powers and functions, which I assume to be statutory, if it is a body that has no statutory basis? That point is entirely separate from the point about the date of 1st April which I mentioned earlier. I believe that these matters should be clarified in response to Amendment No. 190. I beg to move.
The Earl of Mar and Kellie: I believe that the local health co-operative must be assembled by the primary care practitioners. After all, if the chairman of the primary care trust sets it up but nobody wishes to attend, it will not really happen.
Leaving that aside, in my view the Bill does not set out clearly enough the fact that a local health co-operative should have a coterminous boundary with a local authority, not because my noble friends wish to move health into local authority control but because the local health co-operative alongside the local authority, and the social work department in particular, will need to work hard to plan services. To do that with perhaps more than one local authority may prove to be extremely difficult. I am concerned that the Forth Valley health board is proposing to have only two. I do not think that what is called the North Forth Valley Local Healthcare Co-operative will be able to liaise effectively with Clackmannanshire and the district of Stirling without some confusion.
Lord Macdonald of Tradeston: The amendment proposed by the noble and learned Lord would go against a key principle of these reforms. The local health care co-operatives are established on a collaborative and co-operative basis between GPs and other primary care professionals. They are entirely voluntary. After a widespread consultative process we believed that that was the form closest to the culture which had been demonstrated distinctively by the medical profession in Scotland in contradistinction to the majority of the profession in England.
There is a different attitude in Scotland. That was thoroughly tested, I believe, both by experience and consultation. Therefore we believe that we can build on what we have seen to be the clear wish of the profession in Scotland, and not south of the Border. We want to put the frontline clinicians in the lead in delivering and managing services in the community.
The local healthcare co-operatives are our way of delivering this commitment in Scotland. The role we envisage for the primary care National Health Service trusts is that of supporting and developing the co-operatives as primary care clinicians come together to form them. But these co-operatives will be discrete management organisations within the primary care NHS trust. They will be non-statutory bodies and will draw all their functions from the powers of the trust. Their composition, structure and funding will be developed locally. The primary care NHS trust will have overall accountability for the services and budgets managed by the co-operatives. Co-operative leaders will be part of

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the management structure of the primary care NHS trust. We are receiving clear indications that a significant majority of GPs and other primary care professionals are showing interest in developing the local healthcare co-operative across Scotland. On that basis we are content that GPs and other primary care professionals will be able to join a local healthcare co-operative to develop co-ordinated services for their area. Yet again, I agree with the noble Earl, Lord Mar and Kellie, in his analysis of the situation.
Having made the point that the fundamentals here have to be collaboration and co-operation, and that this cannot be imposed on professionals, I ask the noble and learned Lord to withdraw the amendment.
Baroness Carnegy of Lour: Before the Minister sits down, he said that he agreed with the noble Earl. I had understood the noble Earl to say that he thought the co-operatives should be coterminous with local authority boundaries. Surely you could not have such a body stretching from Brechin to Forfar to Pitlochry? One could not expect doctors to drive those distances.
Lord Macdonald of Tradeston: I apologise if I gave the wrong impression. I was drawing on what I thought was the noble Earl's view—I share it with him—that this was based on a collaborative and co-operative spirit among the professionals in Scotland.
Lord Mackay of Drumadoon: I shall not enter into the debate as to whether the noble Earl's contribution supported my position or that of the Minister. I leave that for others to resolve.
While I fully accept that the use of the term "co-operative" implies a measure of consensual agreement among those involved, I remain apprehensive that, if in a particular locality—I deliberately choose a different word from "area" because that may or may not be related to the geographical area in respect of which a primary care trust may have responsibility—for whatever reasons, good or bad, the primary care professionals choose not to enter into a co-operative and a different view is taken by the trust, it may well be that, because of the local difficulties, the patients in the locality will miss out on what I understand to be the benefits of a major plank of the Government's proposals.
I do not seek to press the amendment. It was designed to explore the Government's position. I have received a reply and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 41 [Duty of quality]:
Lord Mackay of Drumadoon Lord Mackay of Drumadoon moved Amendment No. 190A:
Page 31, line 18, after ("Board") insert (", local health care cooperative").
The noble and learned Lord said: I shall speak also to Amendment No. 190B. The two amendments seek to amend Clause 41 in line 18 by adding to the list of those who will be under a duty to put and keep in place arrangements for the purpose of monitoring and improving the quality of healthcare any local healthcare
1538
co-operative which may be established, or any independent provider. I understand that both amendments were tabled by my noble friend Lord Mackay of Ardbrecknish after discussion with and with the full support of the Royal College of Nursing.
The reasoning behind the amendments is self-explanatory. Whether or not a local healthcare co-operative has any statutory basis for its existence, or whether or not any independent healthcare provider operates in accordance with some statutory appointments procedure, they are both operating in exactly the same field as health boards, special health boards and national health trusts. The Royal College of Nursing believes that every patient who might benefit from and receive treatment from those engaged in co-operatives or operating as independent healthcare providers has the right to a minimum standard of quality, care and safety, irrespective of the particular sector from which that care comes.
As the Minister may be well aware, many large independent sector healthcare providers already subscribe to quality assurance schemes and it should not therefore be particularly difficult or onerous to publish details of their arrangements for monitoring and improving the quality of the healthcare they provide. It is also important for patients that smaller independent sector providers are not left behind in the drive which rightly continues to improve quality in the delivery of services in the health centre.
The Royal College of Nursing believes that the independent healthcare sector should not find itself unwittingly using outdated practices or delivering poor standards. The same applies to those who may group together on a voluntary basis in a healthcare co-operative of the nature we have been discussing in the last few amendments.
I find it difficult to imagine why there should be any objection to people who will be assisting in the provision of healthcare being under the same duties of quality as those imposed on health boards, special health boards and national health trusts. For those reasons, I beg to move.
2 a.m.
Baroness Carnegy of Lour: This question of independent sector hospitals, homes and so on is extremely important. We had the discussion in the context of England and Wales and we were told that the whole matter had to wait until the Select Committee in another place had finished discussing it. Does that Select Committee relate to Scotland or not?
The Earl of Mar and Kellie: Perhaps I should clarify for the Committee my position on local health co-operatives which are mentioned in Amendment No. 190A. I have no objection whatever to there being two or more co-operatives in a local authority area. However, I object to the idea of having two local authorities in a co-operative area.
Lord Macdonald of Tradeston: Perhaps I may first answer the question from the noble Baroness,

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Lady Carnegy. The Select Committee will not cover Scotland but the Scottish Parliament will take into account its findings. I am grateful also for the explanation of the concern in relation to the local boundaries.
Amendment No. 190A is intended to ensure that the primary care services are covered by a duty of quality. That is the Government's intention. The clause as drafted already achieves that objective. The local healthcare co-operatives will be non-statutory organisations. They are an integral part of a Scottish primary care NHS trust and will thus be subject to the duty of quality. Therefore, it is unnecessary to refer to that on the face of the Bill.
Lord Mackay of Drumadoon: Before the Minister sits down, can I take it that that answer applies also in respect of Amendment No. 190B?
Lord Macdonald of Tradeston: In relation to that amendment, I do not believe that it would be appropriate to attempt to use the current Bill to place new statutory obligations on private sector healthcare institutions. That will be a matter for the Scottish Parliament to consider in due course. No doubt it will wish to take into account the conclusions of the Health Committee's current inquiry into the regulation, monitoring and inspection of healthcare outside the NHS which my noble friend Lady Hayman mentioned when dealing with Clause 13 last Thursday.
The guidance on clinical governance that was issued to the NHS in Scotland last November makes it clear that its provisions apply to services that the NHS commissions from other bodies. Thus, where the NHS contracts with a provider from the independent sector to provide a service to NHS patients, those contracts should be used to make sure that those clinical governance principles are applied. With those assurances, I ask the noble and learned Lord to withdraw the amendment.
Lord Mackay of Drumadoon: Once again, I am grateful to the Minister for clarifying his position on the two amendments. As regards Amendment No. 190A, he argues—and I see the force of the argument—that the amendment is unnecessary because anybody involved in a local healthcare co-operative would, as I understand it, be operating under the auspices of a particular trust.
I understand his response to Amendment No. 190B, which was to the effect that that is a matter which should be left to the Scottish Parliament. I must say, with respect to the Minister, that those two different answers seem to highlight the concern that I raised when I first entered into the debate on this series of amendments. However, we shall clearly return to that matter on Thursday. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 1908 not moved.]
The Earl of Mar and Kellie The Earl of Mar and Kellie moved Amendment No. 191:
Page 31, line 20, at end insert—
("( ) In implementing and maintaining the arrangements mentioned in subsection (1) each body shall have regard to any guidance issued for England and Wales by the National Institute for Clinical Excellence.").
The noble Earl said: Every other Scottish proposer of an amendment has had a go at this late hour, so Members of the Committee should not imagine that I shall not. It is always a joy to move an amendment after two o'clock in the morning. I am therefore not surprised that the Consultative Standing Committee recommended standing orders for the Scottish Parliament which will be, curiously, held in the "daylight" hours. One of the features of this Bill is that it is little if at all known in Scotland, and when we debate it at this hour, I am not surprised.
Amendments Nos. 191 and 192 have the purpose of clarifying and extending the duty of quality which is rightly being imposed on health boards and NHS trusts. I am well aware that the legislative provision for the health service in Scotland has been presented in stripped-down or minimalist form; and I understand the Government's position on legislating for Scotland in this form. Generally it is right that the Scottish Parliament should have an early opportunity to put its own stamp on the NHS, and to do so in early time. This will be appropriate as health and education vie with each other to be the most important public concerns to be devolved to the Scottish Parliament.
Members of the Committee will have noticed that my amendments have the effect of adding to the minimalist functions laid down in the Bill. That may be worthwhile in this instance. Normally, I am in favour of diversity within the constituent parts and jurisdictions of the United Kingdom. However, during the Committee stages of the Crime and Disorder Act last year, I was able to argue—successfully as it happens—that the Youth Justice Board for England and Wales should be required to study systems of youth justice in other jurisdictions. I clearly had in mind the Scottish children's panels.
It can be argued therefore that health boards and NHS trusts should be required to evaluate themselves against the criteria set down by NICE for England and Wales, though NICE has no authority in Scotland. This could be seen as a useful temporary measure, at least until the Scottish Parliament has enacted its first National Health Service (Scotland) Act.
The second amendment would impose a duty to publicise how the boards and trusts have performed against the NICE criteria and against the expectations that have been sought from the public, from users and carers. That form of public evaluation and identification of future solutions will bring a real relevance to reports on the NHS, its boards and trusts. I beg to move.
Lord Macdonald of Tradeston: I understand why the noble Earl is keen to ensure that work on clinical effectiveness is shared throughout the United Kingdom. That clearly makes sense and the Government have every intention of encouraging that process.

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Our firm intention is that the national institute for clinical excellence will work closely with its counterparts in Scotland. Indeed, arrangements already exist to facilitate such collaboration. The remit of the national institute for clinical excellence (NICE) extends only to England and Wales. In Scotland the Clinical Resource and Audit Group (CRAG)—our acronyms are more rugged than theirs—and the Scottish Intercollegiate Guidelines Network (SIGN) have been in existence for some years performing equivalent functions to NICE. They will be joined later this year by the new Scottish Health Technical Assessment Centre (SHTAC).
The intention is that those Scottish bodies should work closely with NICE, avoiding duplication of effort where appropriate. Already working relationships exist across the Border and there is no need for that to be made a statutory requirement. Indeed, it would be puzzling if there was to be a statutory provision in Scotland relating to NICE without there being reference to the Scottish bodies performing similar functions. I can therefore reassure the noble Lord that guidance produced by NICE will not be denied to Scottish National Health Service bodies. Indeed, I expect guidance issued by our bodies in Scotland to be similarly available, where appropriate, to bodies in England and Wales.
I also appreciate the noble Lord's concern to ensure transparency and accountability by requiring National Health Service bodies to publish information on the arrangements they put in place under that duty. That is a concern that the Government share. However, we do not believe that it is necessary to specify this requirement on the face of the Bill. In guidance issued last November we made it clear that we expect National Health Service organisations in Scotland to publish annual reports on what they are doing to improve and assure quality through clinical governance arrangements. We shall be specifying what those reports should contain.
I do not believe that a statutory requirement for publication will be necessary to ensure that the bodies in question comply with the guidance. After the past hour, I very much look forward to my first appointment
1542
tomorrow morning, which is at the dentist. However, I hope that I have said enough to convince the noble Lord that he need not pursue his amendment.
The Earl of Mar and Kellie: I am very pleased to hear from the Minister that what I have suggested will be happening on an informal basis. Therefore, while contemplating a head to head between CRAG and NICE, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 192 not moved.]
Clause 41 agreed to.
Clauses 42 to 45 agreed to.
Clause 46 [Disqualification of Part II practitioners]:
[Amendment No. 193 not moved.]
Clause 46 agreed to.

Financial Services and Markets
A message was brought from the Commons that they have ordered:
That a Select Committee of eight Members be appointed to join with a committee to be appointed by the Lords, to be the Joint Committee on Financial Services and Markets, to report on the consultative document on the draft Financial Services and Markets Bill presented by Her Majesty's Command on 21st December 1998 and any further draft of the Bill which may be laid upon the Table of both Houses by a Minister of the Crown;
That three be the quorum of the Committee;
That the Committee shall have power—

(i) to send for persons, papers and records;

(ii) to sit notwithstanding any adjournment of the House;

(iii)to report from time to time;

(iv) to appoint specialist advisers;

(v) to adjourn from place to place within the United Kingdom;

(vi) to communicate to any Select Committee appointed by either House its evidence and any documents of common interest;

That the Committee shall report by 30th April 1999.
House adjourned at eleven minutes after two o'clock.