Health and Social Care Bill

HL Deb 19 March 2001 vol 623 cc1159-227

3.6 p.m.

The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath)

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.—(Lord Hunt of Kings Heath.)

On Question, Motion agreed to.

House in Committee accordingly.

[The DEPUTY CHAIRMAN OF COMMITTEES (Lord Boston of Faversham) in the Chair.]

Lord Clement-Jones moved Amendment No. 26: After Clause 3, insert the following new clause—

"RETENTION OF PROVISION OF CLINICAL SERVICES WITHIN THE NHS In section 14 of the Health Act 1999 (exercise of powers by NHS trusts) at the end there shall be inserted— (10) The exercise of powers conferred by paragraphs 10 to 17 of Part II of Schedule 2 to this Act may only be exercised to the extent that it does not involve or permit—

1. (a) the transfer of contracts of employment of registered doctors, registered nurses or professions allied to medicine from an NHS trust or Care Trust to a non-NHS organisation, or
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2. (b) the creation of contracts by an NHS trust or Care Trust with any non-NHS organisation for the provision of the services previously provided by registered doctors, registered nurses or professions allied to medicine to the Trust.""

The noble Lord said: At this stage, I believe that it is customary to speak for a few moments about generalities so that noble Lords are able to make their way out of the Chamber. Indeed, if I were to start speaking to Amendment No. 26, I am sure that the interest in its provisions would prove to be so overpowering that people would wish to stay to hear the profound arguments that I am about to make. However, I see that I have the Minister's attention, so what more could I want in the circumstances?

In moving Amendment No. 26, I shall speak also to Amendments Nos. 29 and 31. All these amendments are closely related: they relate to the new provisions that the Government are introducing as regards PFI/ PPP. We are not perhaps great fans of PFI/PPP on these Benches, not as a matter of principle but simply because we do not believe that those provisions have achieved some of the aims that they were originally meant to achieve. Moreover, they have not been a very transparent instrument of government in many respects. The intention of my amendments is to try to improve that transparency. As I am sure the Minister is aware, a number of outside organisations have considerable doubts about the width of the current provisions, and my amendments are also designed to narrow the scope of such provisions.

The Government's intentions seem reasonably clear, especially as regards the equity participation provisions. In his response, the Minister may care to explain the motives behind such provisions. There are some who would say—far be it from me to agree with them—that this situation arises because it is not possible to get agreement with the private sector in some circumstances because, quite frankly, the return is not there on some of these schemes if the money is put forward by way of debt, or companies expect to get the full return on their investment. That is why the device of allowing government participation in such companies has been adopted. The Minister needs to give us a very clear idea of the true picture. After all, current PFI/PPP powers are fairly wide, which means that this is a rather novel provision.

In addition, the concordat, which many of us welcomed, allows the private sector a strong relationship with the NHS. It allows a straightforward commercial relationship to exist between the NHS and the independent healthcare sector. That in itself seems to us to have advantages as it is perfectly transparent; the commissioning process is clear and the amount of money that is allocated is clear.

The key area of concern arises in the area of acute services. It appears that the new provisions are mainly directed towards LIFT, the primary care structure which is now to be adopted in order to improve provision in under-resourced areas. In many respects that is to be welcomed. By and large GPs are independent contractors unless they work under PMS contract. That kind of public/private sector partnership is welcome. These amendments are probing. However, in our view the Government should give an assurance on the extent to which clinical services could be the subject of PFI/PPP. By clinical services, we mean front line specialty services such as medicine, surgery, obstetrics, diagnostic services such as radiology, pathology, clinical biochemistry—services which are an integral part of the acute medical practice in our hospitals.

The case is being strongly made that it will be extremely difficult to have those services provided by PFI/PPP when other services are not provided by PPP. Indeed, we believe that the whole principle of providing clinical services needs much further debate than simply making it an adjunct to the clause. Indeed, it may be an unintended consequence of the clause but the Minister certainly needs to explain what his intentions are in that respect. I beg to move.

3.15 p.m.

Lord Hunt of Kings Heath

I am grateful to the noble Lord, Lord Clement-Jones, for allowing me to say something about the relationships between the NHS and the private sector which the Government wish to see developed. He mentioned two specific aspects: the concordat and the PFI development. I believe that the concordat, which was signed with the Independent Healthcare Association on 31st October 2000, provides a powerful framework that encourages a longer term more proactive relationship between the NHS and the independent sector but which allows for key decisions to be taken at local level. Over the past few months that has been extremely helpful in relation to winter planning and has enabled the NHS both to withstand the many pressures that arise during the winter and to ensure that we maintain progress in relation to waiting list targets. The concordat should be viewed as a wholly encouraging and responsible measure. We wish to see that relationship developed in the future.

As regards PFIs, we have made great progress since 1997 in our hospital development programme. Some 34 major PFI hospital development schemes have been approved since May 1997. In addition, there are a number of PPP arrangements connected with the delivery of IT and information for health projects. I see Clauses 4 and 5 as building on that general philosophy of co-operation and partnership with the private sector. Essentially, Clauses 4 and 5 are both concerned with providing the Secretary of State and the NHS with powers to invest in companies. That will provide a new way of developing public/private partnerships for the purpose of providing services to the NHS or generating income for the NHS. We believe that these two clauses open up exciting opportunities that have not been available to the NHS to date.

I take the point the noble Lord, Lord Clement-Jones, made about what I believe he described as the straightforwardness of a contractual relationship between the NHS and an independent provider, as opposed to what is enabled by the two clauses. One great advantage of what is being proposed here is that it makes the NHS much more involved as a key player in the organisation and direction of the kind of partnerships about which we are talking.

The noble Lord rightly referred to what we describe as NHS LIFT—that is another "anacronym" beloved of the NHS—the NHS Local Improvement Finance Trust. This is an exciting proposal, a public/private partnership to raise £1 billion to improve primary care facilities initially focusing on deprived areas. NHS LIFT will invest in local schemes, bringing the local health community and private sector partners, including property experts, into a local partnership to improve primary care facilities. As many Members of the Committee will be aware, the standard of many primary care facilities within deprived areas is poor indeed. We see NHS LIFT as a way of bringing in capital, both public and private, to enhance those facilities and also as a way of providing a great deal of expertise in primary care to develop first-class new facilities.

The first application we envisage of the investment in companies for income generation is the creation of intellectual property spin-off companies. The NHS through its research generates a huge amount of intellectual property, but I am afraid that it has not always realised the commercial potential of its discoveries and inventions. We see spin-off companies as being a recognised approach to exploiting intellectual property that is well understood and is used both by the universities and the commercial sector. Allowing the NHS to adopt the same approach will provide significant new opportunities to realise the value of NHS intellectual property.

I have considered with care the three amendments tabled by the noble Lord, Lord Clement-Jones. I consider that they would inhibit the kind of developments that we want to see. In addition, the amendments would place new restrictions on the manner in which NHS bodies currently deliver services. NHS trusts currently subcontract work to the private sector. The concordat framework is a good example of that. Amendment No. 26, if accepted, would prevent that happening.

Amendment No. 29 attempts to circumscribe the services which future public/private partnerships may provide. We have published a list of services which may be provided under contract by the private sector under existing public/private partnership arrangements. The NHS plan commits us to exploring new forms of partnership with the private sector. I say to the noble Lord, Lord Clement-Jones, that any proposals which include categories of services or staff other than those on the list must be approved by Ministers. I believe that his amendment would prevent the development of many new forms of partnership, for example—this is mentioned in the NHS plan—the proposals to develop partnering arrangements for modernising pathology services.

Amendment No. 31, if accepted, would prevent NHS trusts or care trusts from providing many of the services that they currently provide. It would stop those bodies providing clinical services for the purposes of generating additional income and it would mean that NHS trusts might have to close all private patient wards. I do not think that that is practical or desirable. I believe that the clauses that we have are sensible and enable the NHS to build on successful public/private partnerships. In particular NHS LIFT gives us a real opportunity to enhance the quality of primary care services.

Lord Clement-Jones

I thank the Minister for his frank response. My intention was not to divide the Committee but to elicit the frank response that he has given. Although it will not strike terror, it will cause some trepidation to those who are worried about the ultimate conclusion of PFI/PPP. The Minister said that there is a list beyond which the approval of Ministers will be required. I am not wholly familiar with that list; no doubt we shall familiarise ourselves with it.

However, we are into new territory here. The provision does not relate only to LIFT, as the Minister admitted. I should be happy if it were a matter of intellectual property—spin-off companies to exploit inventions or discoveries that have been made within the public sector—and so on. But we are talking about an extension. As originally conceived, various assurances were given about how far a PPP would go with regard to the provision of clinical services. We are clearly crossing another bridge here. I should be happy with that if the transparency were there; if the comparisons with the public sector were there. As a seeker after truth, I have considered every one of the PFI contracts and sought to calculate how the calculations about the transfer were made. I have had some co-operation with the department in that respect. I am baffled. The comparison between public sector financing and PFI is opaque. That worries me.

In the proposed system we are transferring services across to the private sector but the cost to the public sector is unknown. Whether the figure is calculated over 30 or 60 years, we seem to be on very tricky ground. It is an example of a creeping process of PFI/ PPP. It is interesting that the Minister uses the phrase "exciting opportunities". That is the way in which Ministers have always talked about the PFI. It strikes terror into my heart since it has a certain naivety about it.

Lord Hunt of Kings Heath

I cannot let that remark pass. I said "exciting opportunities". The quality of primary care provision in rented accommodation in many inner city areas is often of poor quality. The opportunity to bring in both public and private capital to enhance those premises must surely be exciting. It is one which I believe that GPs and other primary care providers in such areas will welcome warmly.

Perhaps I may give an example. There are GPs who are locked into many years of a lease. It is difficult for them to get out of that lease and move into better accommodation. One of the purposes of NHS LIFT would be to enable that lease to be bought up by an NHS LIFT, and an appropriate rental scheme developed in new premises for those GPs. I think that those possibilities are exciting.

Lord Clement-Jones

The Minister uses the best example. If the terms of the clause were limited to ensuring that LIFT were to take flight (perhaps the expression should be to ascend), I would have no quarrel with that. As I said in my introduction, the majority of GPs are independent contractors who should be free to make contracts with the private sector in the way they see fit. If this system is designed to facilitate that, that is all right by me and these Benches.

There is a tendency in the Bill to take a power for one purpose and say, "We think that that is a useful power. We'll make sure that it is available for all kinds of other purposes". We saw that under the finance sections in Clauses 1 to 3. We now see it in Clauses 4 and 5. It is a recurring theme throughout the Bill. That is what worries me. If the power were purely for LIFT, I should have no objection. But we now see a real sea change in what could be possible under the PFI in terms of the provision of clinical services.

The Minister may say that there are some safeguards; the Secretary of State has to approve. But if the Secretary of State gets over-excited about PFI, as Secretaries of State under this Government have done historically, I can tell noble Lords the answer to the request for approval.

We have worries about the power. I think that it is a sea change in the way in which the NHS is organised. Straight commissioning from the private sector is more honest financially, politically and otherwise; that is what I should prefer, rather than this overcomplicated scheme and the drawing of an opaque veil over the whole process.

If we have a further stage of the Bill—that is not known at this moment—we should wish to develop the argument further. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 4 [Public-private partnerships]:

Earl Howe moved Amendment No. 27: Page 4, line 5, after "otherwise)," insert "or to issue (or procure the issue of) shares or other securities in the companies to any person,

The noble Earl said: In moving the amendment, I shall speak to Amendments Nos. 28 and 32 to 35.

It is a pleasure to welcome in Clause 4 of the Bill an explicit acknowledgement by the Government of the value of the private sector in helping to deliver facilities and services to the NHS. As I said at Second Reading, we look forward to the arrival of NHS LIFT which holds the potential to bring much-needed improvements to GP premises but, equally important, to do so where there has been market failure in the normal commercial mechanisms for generating such improvement. That is where NHS LIFT will come into its own.

NHS LIFT is an acronym. I thought that the Minister said—I may be wrong—an "anacronym" which conjures up all kinds of pejorative connotations. The Minister's reply to the last group of amendments was helpful. However, there are still many gaps in our knowledge. We have only the barest outline in terms of how the new systems will operate.

One of my main concerns relates to the absence of any specific provision for parliamentary scrutiny. The companies which are set up to handle these activities will undertake very significant financial commitments. One has only to think back to recent history and the sad saga of the New Millennium Experience Company to realise the damage that can be done by, some would say, excessive secrecy when public money is being spent. Instead of shielding Ministers, that secrecy can expose them to an unending series of questions from the press and Parliament. It would be highly desirable if Parliament, as a matter of routine, were to have a statement from the Secretary of State when the powers in Clause 4 are first exercised and then annually so that the financial and other commitments made by the Secretary of State can be monitored properly.

I recognise that there are issues of commercial confidentiality here. I respect that completely. That is why Amendment No. 34, which inserts a new clause after Clause 5, refers to the laying of a written statement "as soon as reasonably practicable".

It is also important to provide for an annual report and accounts to be laid before Parliament in those cases where a company is publicly controlled or where there is any public stake. Those companies will not be non-departmental public bodies. If they were, the laying of accounts would be automatic. However, Clause 4 tells us that the Companies Act will define the rules for preparing the accounts. Therefore we need to create that link with Parliament.

Subsection (4) of Amendment No. 35 grants access rights to the Comptroller and Auditor General. That is consistent with the report prepared in February of this year by the noble Lord, Lord Sharman, entitled The Review of Audit and Accountability for Central Government. In that report, the noble Lord, Lord Sharman, recommends that the Comptroller and Auditor General should be entitled statutorily to audit publicly owned companies. I believe that my proposal fits in with the spirit of what the noble Lord suggests.

In Amendments Nos. 27 and 32 I have raised a separate and somewhat technical matter. In Clauses 4 and 5 the Government give themselves the power to form companies, but not to issue shares in those companies to a private partner. I recall that a specific provision was thought necessary to do that in the context of NATS. Is the same true here?

Amendments Nos. 28 and 33 were prompted by a political concern. I welcome the introduction of the new powers, but they are only powers. They would not have to be used by any future Secretary of State who was less open-minded than the present one obviously is on the suitability of the private sector as a vehicle for bringing about improvements. The thought that I should like to plant in the Minister's mind through the amendments is that the Secretary of State should have an obligation to consider in all such cases whether the private sector offers an appropriate means of delivering the desired outcome. I do not believe that the Secretary of State should have an excuse for ignoring the private sector option merely because he is ideologically hostile to it.

I conclude my remarks with a few questions for the Minister on the clauses. Clause 5 gives a power to form companies that in one way or another will work to the benefit of the health service. What will happen to the current terms and conditions of service of employees of the health service who are asked to go and work for one of those companies? Will TUPE rules apply to them?

Secondly, will the Minister provide some concrete examples of how the powers in Clause 5 are likely to be used? Will he expand on his reference to intellectual property? I am probably not alone in finding the Explanatory Notes slightly less than helpful here. In particular, will he lay to rest a current canard on anonymised patient data? There is a rumour going about that once the copyright for the information can be controlled by the Secretary of State, as Clause 67 provides, it is only a short step away from being vested in him. Once that happens, the information will be ripe for commercial exploitation by the Department of Health. I hope that that is an unfounded rumour, but it would be helpful to hear the Minister repudiate it.

Lastly, if the Government take only a minority stake in a company, as I understand is the intention with NHS LIFT, what leverage will they have to ensure that investment is channelled to where it is most needed? Where there is market failure in the normal mechanisms for attracting investment or loan finance, how will NHS LIFT ensure that those deprived parts of the country receive the money that they have been unable to generate elsewhere? I beg to move.

3.30 p.m.

Lord Hunt of Kings Heath

I am grateful to the noble Earl, Lord Howe, particularly for his general welcome for what is proposed and the benefits that he sees in NHS LIFT. I shall try to respond to the points that he has raised.

The aim of the clauses is to enable the Secretary of State to enter into public/private partnerships to deliver services to the NHS or for the purpose of income generation. The noble Earl has raised some important points, but they are covered. Amendments Nos. 27 and 32 would enable the Secretary of State to issue shares or other securities in a company to any other person or company. That is unnecessary because any company established under the powers in these clauses could issues its own shares. We would not want a power to allow the Secretary of State to issue those shares. The aim of the clauses is to allow the Secretary of State to participate in establishing a company as part of a public-private partnership. We do not envisage the Secretary of State setting up a wholly owned company and then issuing shares at a later date.

The noble Earl asked what leverage the Secretary of State would have if he had a minority shareholding in such an organisation. Any companies so established would focus on NHS activities. If the Secretary of State was unhappy with the progress of a company and its policies, he could walk away from it. The credibility of such partnerships rests on the NHS having confidence in the arrangements.

I shall resist Amendments Nos. 28 and 33 because they would return us to the days when all proposals for capital investment had to be subject to testing for private finance. As part of our aim to decentralise decision-making to local level, we are not insisting on a rigid approach on that. The noble Earl will probably recall the Sackville pledge under the previous government. Testing of all investment for PFI led to a huge amount of bureaucracy and real problems in making progress. We require the NHS to ensure value for money in all proposed investments. Current guidance is clear that all procurement that would involve capital expenditure should normally consider PFI, but if an NHS trust considers that a project has very little chance of attracting private finance—for example, if it is a very small scheme—the interests of the NHS would not be served by testing for PFI and PPP. In those circumstances, the trust is exempted from a requirement to consider PFI. Each project is considered on its merits. It is best to leave that decision to individual NHS trusts.

The noble Earl asked about TUPE. It would apply either as a matter of law or under Cabinet Office guidance. I hope that that gives him the assurance that he requires.

I have come across an example of a spin-out company, which the noble Earl asked for. The Royal Marsden is developing what is called a PET scanner. A new company has been formed to develop that machine, but at the moment the Royal Marsden cannot take shares in that company. The NHS is integral to the development of new machines in such cases and it would be a matter of great regret if it were not allowed to enjoy the fruits of the work that had been undertaken.

I assure the noble Earl that any company formed under Clauses 4 and 5 will be required under Companies Act regulations to produce annual reports and accounts. It is our intention that all the companies formed under Section 96C(1) of the 1977 Act will be public companies. That means that a report and accounts must be filed with Companies House within seven months of the end of the financial year. The Secretary of State will ensure that the published reports and accounts are placed in the Libraries of both Houses promptly following publication.

To answer the noble Earl's specific point, the Department of Health's annual report will in future include a section providing details on all investing activities. It will include information on audited bodies, such as the name of each company, the purpose for which it was formed, the percentage of each class of share held by the Secretary of State, the amounts invested and the details of loans or guarantees provided.

Those reporting requirements will be in addition to the statutory reporting requirements with which the companies will be required to comply. Statutory reporting requirements will include the following: any share held by the Secretary of State or his nominee will be disclosed in the Department of Health's resource accounts, which will be published in compliance with the Government's resource accounting manual; and, in the case of Clause 4 for health authorities or primary care trusts and Clause 5 for NHS trusts, any investment will be disclosed in the annual accounts, which are required to be published under the National Health Service (Primary Care) Act 1997.

I come to the interesting point which the noble Earl raised with regard to the Comptroller and Auditor General. At present, the Comptroller and Auditor General does not have that power. However, the scope of his remit is currently being considered by the Government. We have already said that, under the review of companies which is being conducted by the Department of Trade and Industry, we shall consider the possibility of legislating to make the Comptroller and Auditor General a Companies Act auditor.

The noble Earl is right to say that that was recommended by the noble Lord, Lord Sharman, in his recent review of audit accountability for central government. I can assure the noble Earl, Lord Howe, that, if the recommendations of the review by the noble Lord, Lord Sharman, are accepted, clearly they will apply to any PPP. At this stage I cannot prejudge either the outcome of the review or the Government's response. However, I hope that the noble Earl will accept that we wish to ensure that that information is placed in the public domain.

Baroness Cumberlege

Perhaps I may press the Minister on something that he said. I may have misheard him. He mentioned that the Secretary of State would walk away from any partnership which he felt was unsatisfactory or possibly failing. I can understand his wish to do that, but how does that give confidence to the private sector? What guarantees will the private sector have?

Secondly, I want to ask the Minister whether he will respond to the question about attracting developers into the heartbreak wilderness areas, to which, in the past, they have not been attracted. What incentives does the scheme provide to ensure that developers go into those areas? If they do not, that will reinforce the inverse care law, which would be a great pity.

Finally, I want to ask about the spin-out companies which were mentioned by the Minister. In debate in another place, the Minister, Mr Denham, described the development of spin-out companies as exploiting intellectual property. I very much endorse that. I believe it is right that the NHS should benefit financially from innovation discovered within the service. However, without going into detail, in another place the Minister said that we must recognise that clear procedures are needed for managing risks with spin-out companies. I believe that it would be very helpful to the House if the Minister could set out the details of those companies. It may not be possible to do so this afternoon, but he may be able to place something in the Library which we can see before Report stage—if, indeed, there is one.

Lord Hunt of Kings Heath

In answer to the final point made by the noble Baroness, we shall, of course, need to set out guidance and procedures to ensure that the management of such companies is conducted properly and that we do not, for example, face a situation in which an NHS trust becomes rather over-entrepreneurial and seeks to make money at the expense of its core activities. We are clear that spin-off companies should enable the NHS to see a return. However, that is based very much on taking advantage of the work being done within the NHS trust. I shall find what information I can to send to noble Lords and to place in the Library before Report stage. However, clearly further work needs to be undertaken following the passage of this Bill.

In relation to the Secretary of State walking away from an agreement, I very much hope that that does not happen; indeed, I have been encouraged by the discussions that have taken place between the department and various potential public/private partners in the whole area of public/private partnership. Of course, the intention is that an agreement should be reached on the best way forward with a commitment on both sides to make the project work. I was simply answering the point raised by the noble Earl, Lord Howe, as to how to proceed in the event of a fundamental breakdown in the relationship. However, there will be a great deal of incentive on both sides to ensure that such a relationship does not break down.

The noble Baroness raised an interesting point in asking why this project will be more successful than others in improving the quality of facilities in primary care areas. I want to make two points about that. First, the Government will put money into the scheme so that it will be seen to have received commitment in a financial as well as a policy sense.

Secondly, because of the way that NHS LIFT will operate, there will be a greater opportunity to put together sensible programmes which will be successful. Perhaps I may give an example. At present, very often a problem in relation to primary care is that schemes are limited and small-scale and, therefore, are not particularly attractive to major investors. However, by batching together a number of different developments, savings can be made both in development and transaction costs.

A third area in which the project is likely to be more successful is in building up a residue of expertise. Again, at present, in attempting to sort out poor quality primary care facilities, a problem is faced in knowing where to turn in order to find expertise, particularly in relation to private sector investment. I believe that the whole package of NHS LIFT will be able to provide the type of expertise that is required. None the less, I believe that that is a great challenge faced in primary care. It fits together with our other plans to ensure that the resource allocation formula also provides financial incentives.

3.45 p.m.

Baroness Noakes

Perhaps I may press the Minister on the information that will be given when the new companies are set up. If I heard him correctly, he said that he would devote an extra chapter of the Department of Health's annual report to those companies and would give the information which Amendment No. 34 seeks to provide. The annual report is published six months or so after the end of the year. Therefore, if one of those companies were to be set up on, let us say, 1st April 2001, information might be made available to the public in October 2002. The amendment provides for early information to be given when one of those companies is set up.

I should be interested to know how the Minister saw information being made available to Parliament on a more timely basis. We must recognise that, in setting up those companies, significant financial commitments could be entered into, guarantees given by the Government, and significant projects could be entered into whether the Government have a minority or majority interest; that matters little. When the Government are involved in such companies, many issues are raised with regard to the Government standing behind the companies. Perhaps I may press the Minister on what information he envisages will be made available to Parliament in advance of the Department of Health's annual report.

Lord Hunt of Kings Heath

I rest my case on the information that I have already given. In terms of appropriate parliamentary reporting, the Department of Health's annual report provides the necessary information to ensure that Parliament is aware of what has occurred. The noble Earl, Lord Howe, hinted at the fact that it would be premature to bring information before Parliament at an early stage in the discussions or agreement. I believe that the suggestion in relation to a short period of retrospection would discharge appropriate information to Parliament. After all, as the noble Baroness said, the information would be available only a few months after the end of a financial year.

Baroness Noakes

Perhaps I may make the point that there would be a potential delay of 18 months after a transaction had occurred. That is rather a long time.

Lord Hunt of Kings Heath

I accept that, but we are not talking here about a requirement for parliamentary approval to be given. That is a matter for agreement between the Secretary of State and any of the companies involved. The question is how that action should be reported. I really believe that a period of six months or so after the end of the financial year is appropriate and, indeed, consistent with reporting by the previous government.

Earl Howe

I am grateful to the Minister for his very full reply and for the number of helpful assurances that he was able to give me. I shall obviously read extremely carefully what he said.

Perhaps I may pick up two points. The Minister indicated in response to my Amendments Nos. 28 and 33 that it was inappropriate to suggest that the Secretary of State should automatically consider the private sector whenever there is a proposal on the table for a new project under either of those clauses. He referred back to the regime of compulsory competitive tendering which used to operate. That was not in my head when I tabled the amendments. The wording of the amendments is chosen carefully to ensure that the Secretary of State should consider whether the facilities or services in question can be provided most efficiently and cost-effectively through the involvement of the private sector. So, if he were to decide that a process of competitive tendering was not appropriate because it was not cost-effective, then that would not happen. I was sorry that the Minister was not able to take on board the point I made in the spirit in which I was trying to make it.

The second point to which I want to refer is a point which my noble friend has just mentioned; that is, the ability of the Secretary of State to use NHS LIFT to direct investment to where it is most needed. I queried whether as a shareholder in a minority company, the Secretary of State would have much leverage in that sense.

I was rather surprised to hear the Minister say that in the final analysis, the Secretary of State could walk away from the company. Unless I am completely wrong, NHS LIFT will essentially be a finance company. Because the Secretary of State will have only a minority holding, the borrowing of that finance company will be off the public sector balance sheet. Although that borrowing will be raised at commercial rates, it will be at very favourable commercial rates, by virtue of the Secretary of State's shareholding.

I am not sure how reassured the City will be to hear that the Secretary of State could simply walk away from such an arrangement. That is a surprising thing to contemplate because the private sector needs to be given as much confidence as possible. The taxpayer and the general public need to be given confidence that there is proper value for money for public funds.

We all look forward with great interest to what NHS LIFT will bring to us.

Lord Hunt of Kings Heath

Perhaps I may respond to that. First, we are earmarking £175 million for investment in NHS LIFT over four years. That is a very substantial degree of investment and it shows the degree of commitment which we have to making NHS LIFT work. Equally we want to move on as quickly as possible the refurbishment of primary care facilities in this country. That will certainly not happen overnight. Therefore, the City can look to continuing support and enthusiasm for what is planned from the Government.

The point I am trying to make is that, if the Government have a shareholding in a particular company, they can do what other shareholders can do in companies, no more than that.

Earl Howe

I hear what the Minister says. We both hope that it will never come to that. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 28 and 29 not moved.]

Baroness Northover moved Amendment No. 30: Page 4, line 23, at end insert— (6) For the purpose of subsection (1) above, the Secretary of State shall make regulations to establish and require systems of operation that safeguard patient interests, in particular to ensure adequate care standards, accountability and transparency. (7) Before making any regulations under subsection (6) above, the Secretary of State shall consult such bodies who represent the interests of those likely to be affected by the regulations.

The noble Baroness said: This amendment provides that the Secretary of State must make regulations to ensure that systems are in place which safeguard patients' interests, especially in ensuring adequate standards of care, accountability and transparency. It states also that before making such regulations, the Secretary of State, shall consult such bodies who represent the interests of those likely to be affected by the regulations".

In particular, this amendment would ensure that commercial interests were not put ahead of patients' interests. In another place, it was implied by the Minister in Committee that that provision is mainly about the provision of premises. I thought that might have been an accidental slip, but the noble Lord, Lord Hunt, with a long history in the NHS, also emphasised that in his reply to my noble friend Lord Clement-Jones. However, that is not what the Bill says.

The Bill includes services. Clause 4 permits public/ private partnerships to employ doctors and nurses and to provide clinical services. The remit of the private sector extends there into the mainstream NHS. I have severe reservations about that and the fact that this has been slipped in here and, therefore, there has been very little debate on the issue.

However, given that that is what it does, we must make explicit that patients' interests are paramount. Such arrangements must provide the highest standards of care. It is vital also that arrangements should be transparent and accountable. That is what this amendment would help to achieve.

The NHS should place patients and their interests at the heart of its thinking, regardless of how and where that patient is treated. I beg to move.

Lord Peyton of Yeovil

I do not wish to disturb the rather excessive calm of the afternoon but I find myself on what I hope is the Government's side. I hope that the noble Lord will not accept the noble Baroness's amendment for the very good reason that while I do not fall over backwards ever to applaud the inborn intelligence and vision of any Secretary of State, I cannot see how any Secretary of State addressing those problems can possibly fail to have in mind the need to establish and require systems of operation that safeguard patients' interests. If he is not interested in patients' interests, then, manifestly, he should not be in the job at all. We should not waste our time instructing the Secretary of State to do anything quite so obvious as this.

I will go so far as to say that Secretaries of State are not absolutely congenital idiots. To suggest that they need to consult those who represent the interests of those likely to be affected by the regulations is somewhat superfluous, to put it very mildly, and I hope that the Minister will reject the amendments.

Lord Hunt of Kings Heath

I find myself in agreement with the noble Lord, Lord Peyton. Indeed, perhaps it is an opportunity for me to plug again his excellent autobiography of ministerial life which no doubt he would consider to be a pattern of consistency across his own work as a Minister and what is being proposed here today.

He is absolutely right. Clearly, it is difficult to conceive of any circumstances in which a Secretary of State would agree to any of the proposals under these clauses were he not to believe that they were in the best interests of patients.

I do not want to go through a whole list of responsibilities, obligations, current regulatory checks and financial legal requirements that exist in relation to any action that is undertaken by the Secretary of State or NHS bodies in relation to the NHS generally and the use of these new powers, but they are extensive. There is the legal duty of the quality of care, clinical governance, the role of the Commission for Health Improvement, the NHS performance assessment framework, the NHS clinical governance support work and the establishment of the National Institute for Clinical Excellence. All those mechanisms—some noble Lords believe there are too many—are in place to ensure that the NHS operates in the best interests of the public.

I want to make it clear that Clause 4 does not seek to establish new ways of working for the private sector. Any service or facility delivered as a public/private partnership will need to be to a specified standard. That specified standard will be no different from that required of any other provider, whether in the NHS or the private sector. The sanctions that are in place within any contract to ensure a high quality of service and the requirement and duty on the Secretary of State and NHS organisations always to act in the best interests of patients and the public surely are safeguards enough.

4 p.m.

Lord Peyton of Yeovil

Courtesy obliges me to say how much I am indebted to the noble Lord for his kind reference to my autobiography. In fairness to the Minister, I should make it absolutely clear that, in the present political climate, I shall not be paying him any commission!

Baroness Northover

It is refreshing to hear such trust as the noble Lord, Lord Peyton, has expressed. I am obviously of a cynical, younger generation.

Lord Peyton of Yeovil

The noble Baroness speaks of "such trust". My tribute to Secretaries of State was that I thought that they were entitled to the assumption that they were not congenital idiots. I did not go very far!

Baroness Northover

I hope that he will be proved right. We shall see. The Minister reassures me and at this stage I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 4 agreed to.

Clause 5 [Income generation]:

[Amendments Nos. 31 to 33 not moved.]

Clause 5 agreed to.

[Amendment No. 34 and 35 not moved.]

Clause 6 [Terms and conditions of employment by health service bodies]:

On Question, Whether Clause 6 shall stand part of the Bill?

Earl Howe

At Second Reading the Minister took me to task for describing this Bill as a series of centralising measures. However, like it or not, in Clause 6 we have a classic example of a centralising measure. The clause creates a new power for the Secretary of State to intervene in laying down the terms and conditions of the staff employed by NHS trusts and primary care trusts. The explanatory notes speak of the need to modernise the NHS pay system—the word "modernise" is greatly overused—and the Government's desire to deliver better, fairer awards for staff.

No one can argue with the desire for fairness in the awards for staff, but why it is thought to be fair to have a uniform set of terms and conditions imposed from above on each area of the country is not explained. To me it is self-evident that different conditions of employment exist in different areas. Someone living in the south-east of England will have a higher cost of living than someone in the north of England. The quality of life in low-cost areas is often a great deal better than in high-cost areas. I am baffled as to why the Government want to treat those two cases as identical, instead of doing exactly the opposite, which is to recognise that the NHS needs local structures and local flexibility to address the problems that it faces in different areas.

The health service suffers from many difficulties, but in my opinion at the heart of all of them is the problem of recruiting and retaining staff. That problem will not be solved by regulation and direction-making powers that seek to determine the way in which every NHS trust and PCT deals with its staff.

That is not what happens in the commercial world, where, typically, power and responsibility are devolved downwards.

When NHS trusts were first set up an important element in the design was operational freedoms. Managers of NHS trusts run complex businesses in which staff costs represent a major part of the annual budget. To deny local freedoms, as proposed by this clause, is a significant inhibition. Once you tell managers that they must abide by national regulations and directions, it is difficult to see what real freedoms exist.

I shall be glad to hear from the Minister that I have interpreted this clause in an over-literal way and that local flexibilities in the setting of pay and conditions will still be allowed to continue. Can the Minister tell the Committee how the Government view the future shape of pay structures being determined and the extent to which managerial discretion will play a role in such matters?

Lord Peyton of Yeovil

I am in the happy position of being able to agree with every word spoken by my noble friend. Not being restrained by the discipline of being on the Front Bench, I can perhaps be a little freer in the expression of my opinions. I rely entirely on the Explanatory Notes which on such occasions the Government kindly provide. Paragraph 48, with an air of novelty, states: The NHS Plan commits to modernisation of the NHS Pay system to deliver better, fairer awards for staff". There is nothing new about that. I believe that generations of Ministers and Governments have aimed at precisely that. No matter how intelligent, or unintelligent, they have been, none of them can ever claim that their profound and continued efforts have resulted in total satisfaction for anybody in the whole of the National Health Service. We have been here before. What is the point of repeating exercises that so far have failed? Or is this to be something totally and fundamentally new?

Before I leave that paragraph and despite what I said about Secretaries of State not being congenital idiots, I go further and congratulate them on the degree of—I almost said courage, but that is the wrong word—daring that they show in promising this. If anyone believes them, I would place a large wager that their hopes will eventually be disappointed.

The next paragraph in the Explanatory Notes gives powers to the health authorities to employ people on such terms as they think fit. The sentence breaks off and this is added: but subject to regulations or directions by the Secretary of State or the National Assembly for Wales". What on earth is the good of saying, "They can do what they like as long as they agree with me"? That is what the Secretary of State is saying. There is no point in doing that. All of us understand perfectly that neither the primary care trusts nor the NHS trusts could possibly act in the matter of salaries and awards without the consent and agreement of the Secretary of State. Why, in the name of conscience, do the Government not say so, instead of giving us all this flannel?

Baroness Cumberlege

Will the Minister elucidate one point for me? In dealing with Clause 6, the Explanatory Notes state: The NHS Plan commits to modernisation of the NHS Pay system to deliver better, fairer awards for staff". The Minister will remember that during his distinguished career in the NHS we saw the rise of the pay review bodies. They were introduced because staff felt that the awards they were receiving were not fair. They felt that they needed an independent body which would assess their work and make recommendations about their pay and conditions.

Where in these provisions do the pay review bodies appear? Will the Secretary of State take into account their recommendations and will he either overrule them or agree with them?

A great benefit of the pay review bodies is that they take evidence from everyone concerned and it is published. Everyone in the NHS knows what is happening. However, the Explanatory Note states: Before making any such regulations the Secretary of State … would be required to consult representative bodies". Does that mean that he will take evidence in the same way and will that evidence be published? If not, how do we know on what basis the Secretary of State is making the decisions?

Lord Hunt of Kings Heath

We return to the debate which has run through all our discussions in Committee; that is, the balance between national determination in relation to the NHS and local freedom of action for NHS employers.

I was interested in the noble Lord's analysis of efforts made by previous Ministers to deal with pay, staff and recruitment in the NHS. Looking back over 52 years of the NHS, we see that during most of its life a centralised system of pay determination was undertaken through the Whitley councils and latterly through pay review bodies in relation to doctors, nurses, midwives and health visitors. There was little discretion at local level and that became frustrating for local employers.

In response to that, the previous government introduced local pay but in the end that was not successful. First, it is interesting to note that, although most trusts introduced local contracts of employment, the vast majority of those contracts simply mirrored national agreements. Therefore, although the procedure could be defined as local pay determination, in practice it was still local administration of national agreements.

Secondly, a wholesale translation of decisions on pay to local level ignores the fact that the NHS is a national service. Often, as regards the group of staff we are seeking to attract, there is a finite number of people whose sole employment is within the NHS. In those circumstances, it does not make sense to have a free-for-all at local level.

Thirdly, the failure of local pay determination, as the previous government tried to introduce it, was also due to the fact that those in the NHS never wanted it and never accepted it. There were always problems when not only the workforce but managers were not signed up to the devolvement.

We are trying to get the balance right.

4.15 p.m.

Lord Peyton of Yeovil

We can all recall and remind ourselves of past failures and shortcomings. However, I am asking the Minister to enlighten me on how the Secretary of State will improve on matters with his interventions. What magical balm will he breathe over these awkward problems?

Lord Hunt of Kings Heath

I was just coming to that. We were faced with a local pay system which was not working, disparate employment practices and an inflexible structure at national level. For example, even as regards Whitley contracts which are agreed nationally, there are large variations in payments between different staff groups for, say, working unsocial hours and overtime rates. That makes it difficult at local level to introduce team working and to break down barriers between professions.

In answer to the noble Lord, Lord Peyton, in discussions with staff organisations we are proposing to get the balance right between the national framework for employment, which the clause will help ensure is followed in every NHS trust, and the local flexibility needed by individual employers in the NHS. For instance, if the current negotiations are successfully concluded, we will give NHS trusts local flexibility over defining the skills and knowledge needed to do particular jobs, but a national framework for core skills and knowledge applicable to all staff in similar jobs. Again, we would give trusts the freedom to determine the working patterns which they need to deliver services, but a consistent and simplified framework for rewarding staff whose working patterns are particularly demanding.

Returning to what the noble Lord, Lord Peyton, said, it is not the intention to regulate for everything that must be done at local level. That is why the Bill allows for trusts to retain their existing freedoms to decide whom to employ and to reach local agreement about terms in the areas where regulations and direction have not been made.

Most NHS terms and conditions are already determined nationally for most staff, and have been under successive administrations. In the light of that, many employers have already indicated their desire for an approach to contracts that is somewhere between purely national and purely local by developing what they describe as hybrid contracts. That would include some local elements but also replicate or import many of the terms and conditions in national contracts.

The clause seeks to develop that intermediate approach further by defining a national framework where that is to the advantage of the NHS nationally, leaving other matters to local employers where there is advantage in so doing. A good example of that is in job evaluation. Under the current national system, jobs are defined centrally and pay is determined centrally. Under the new system currently under negotiation, jobs can be defined locally. If a trust identified the need for someone who combines skills for different occupational areas, it would be able to devise such a job. It would not need to have a central edict telling it how to do it.

I say to the noble Earl, Lord Howe, that in determining pay, a trust would also have the facility to make allowance for labour market shortages. However, the long-run basic pay for the post will need to be determined by a nationally agreed job evaluation system in order to ensure consistency with equal pay principles and thus protect the NHS from subsequent equal pay claims.

I accept that there will always be debates about where the balance between national and local rests, but I do not believe that it detracts from the principle of trying to get local flexibility. However, where national guidance and direction is required, the procedure will enable that to happen.

As regards the points raised by the noble Baroness, Lady Cumberlege, about pay review bodies, the position remains the same. It is the job of the independent pay review bodies to make recommendations. It is then up to the Government whether or not to accept them. I believe that the record of the current Government in accepting the recommendations of pay review bodies is absolutely excellent, in sharp contrast to previous efforts where phasing was introduced in providing awards. That was a very demoralising factor for NHS staff.

In the end, no one can pretend that to devise a pay system which meets everyone's desire is easy. As to that. I accept the strictures of the noble Lord, Lord Peyton. But where we can make progress on agreements with staff organisations at national level, which in the main allow for a national framework that is put in place locally, we need the powers provided in the Bill.

Baroness Cumberlege

We could have a ding-dong on this matter. It is true that the previous government phased awards, but the Labour government before them were alone in failing to honour nurses' awards. If the framework is already set by the pay review body and Whitley councils, what will happen to the Whitley councils in future? The previous government introduced local pay which provides the flexibilities about which the Minister speaks. I believe that this clause usurps the agreed framework of the pay review bodies and the Whitley councils and substitutes the Secretary of State. As to that, there are real reservations on this side of the Committee. Secretaries of State come and go. It is right that National Health Service staff should know where they stand. They should be aware of the framework and have an input into it, as they do now.

Lord Hunt of Kings Heath

The discussions with staff organisations and employers have shown great support for the direction in which we are proceeding. I believe that nothing I have said could undermine the role of pay review bodies. They are independent bodies which make recommendations to the Secretary of State. If we want a modern pay system, the real problem is that there are different groups of staff with different terms and conditions at local level. That is inflexible and sometimes it is very difficult to enable staff to cross professional barriers. The NHS Plan is very keen, rightly so, to try to break down some of the professional barriers. Job evaluation is a very important component in trying to break down those barriers so that there is greater consistency of approach between different staff groups. That will not work unless there is confidence that when agreement is reached at national level it will be implemented at local level. But the whole purpose of an area like job evaluation is to allow for local flexibility, and that is why the power would be used only when it was needed. As always, we wish to ensure that there is as much local freedom as possible.

Earl Howe

I thank the Minister for his comments. I am also grateful to my noble friends Lord Peyton and Lady Cumberlege whose remarks are, as ever, 100 per cent apposite. Despite the Minister's reasonable tone, there are lingering worries about the clause. The noble Lord spoke about the setting up of a national framework to facilitate hybrid contracts of employment. I cannot help but believe that, at the end of the day, the local flexibilities which remain will be a good deal narrower than those that obtain at present, which is a pity.

I should like to put one further question to the Minister, who apparently seeks to respond in any case. I may have an unworthy suspicion. Can the Minister tell the Committee whether the clause is perhaps a Trojan horse? Is it seen by Ministers as a means by which a consultant contract could be imposed unilaterally by the Government?

Lord Hunt of Kings Heath

Of course, this clause could be used in relation to the employment of doctors. But I assure the noble Earl that the current situation causes real problems for local employers in securing the flexibility they want. Even with the so-called freedoms on local pay, which they have very great difficulty in implementing, the health service is hidebound by years of tradition and national agreements, all of which produce different terms and conditions for different groups of staff. If at national level we can sort out a good deal of that, we can provide greater flexibility at local level and ensure that as between employers and different staff groups there is more effective team working because of greater consistency of approach.

Clause 6 agreed to.

Lord Clement-Jones moved Amendment No. 36: After Clause 6. insert the following new clause—

"COMMUNITY HEALTH COUNCILS: ADDITIONAL FUNCTIONS

(1) The Secretary of State shall make regulations providing, in relation to Community Health Councils ("Councils") in England, for—

1. (a) the delivery by Councils of support and advocacy services to patients and others with complaints about health services;
2. (b) Councils to advise and make recommendations to the relevant overview and scrutiny committee, Health Authority and trust about matters arising from complaints;
3. (c) reports on the operation of the complaints support service to be compiled by Councils and provided to the Secretary of State to the relevant overview and scrutiny committee, Health Authority, trust, and other appropriate organisations;
4. (d) annual reports to be published by Councils detailing the arrangements maintained in that year for obtaining the views of patients;
5. (e) the establishment of sub-committees of each Council to be known as Patients' Forums, for each NHS and Primary Care Trust in the district of the Council, made up of representatives of the Council, and co-opted representatives of the local authority overview and scrutiny committee, patients, carers and the wider community, with duties to—
1. (i) monitor and review the operation of services provided by, or under arrangements made by, the trust to which it relates;
2. (ii) obtain the views of patients, carers and the wider community about those services and report on those views to the Council and the trust;
3. (iii) provide advice and make reports and recommendations about matters relating to those services to the Council, the relevant Health Authority, and the trust to which it relates;
4. (iv) make available to patients, carers and the wider community advice and information about those services;
5. (v) in the case of primary care services, carry out the functions as may be prescribed by regulations made by the Secretary of State;
6. (vi) carry out such other functions as may be prescribed by regulations made by the Secretary of State;
7. (f) the appointment of representatives from the Patients' Forum as non-executive directors to the board of the trust to which the Forum relates;
8. (g) for functions of Patients' Forums to be performed under joint arrangements between Councils, where such arrangements are appropriate to meet the needs of their communities;
9. (h) the extension of Councils' rights of inspection to all premises from which services as defined in subsection (3) are provided; and
10. (i) matters of concern which Councils may refer to the National Institute for Clinical Excellence, the Commission for Health Improvement, the Audit Commission and the Secretary of State.

(2) References in subsection (1) to "services" are references to—

1. (a) services provided as part of the health service (within the meaning of the 1977 Act) in England;
2. (b) services provided in England in pursuance of arrangements under regulations under section 31 of the Health Act 1999; and
3. (c) services provided elsewhere in pursuance of such arrangements with a local authority in England.

(3) In subsection (2)—

1. (a) "relevant overview and scrutiny committee", means the committee of the council or councils whose district corresponds, or is included within, the community represented by the Council,
2. (b) "relevant Health Authority" in subsection (1)(e) in relation to a Patients' Forum for a Primary Care Trust, means the Health Authority whose area is, or includes, the area for which the trust is established.

(4) Before making regulations under this section the Secretary of State shall consult with Councils and such patients' and carers' organisations as he considers appropriate."

The noble Lord said: The Committee moves on to what I believe will be one of the most contentious parts of the Bill. I do not intend to rehearse all the arguments against the current structure set out in the Bill which many of us on all Benches expressed at Second Reading and in other debates in this Chamber. In moving Amendment No. 36, I should like to speak to Amendments Nos. 85, 88, 90 to 95 and 139, but not 136 and 137, which should come later in the Committee's deliberations.

I should like to present a menu of possibilities which the Minister may care to inspect. Both in Committee in the other place and, to some degree, in the run-up to this debate the Government have demonstrated some flexibility in relation to the pattern that they tried to establish in the national plan, which was a hasty concoction. They produced for our inspection a very fragmented plan which effectively disaggregated consultation from advocacy, advocacy from scrutiny, scrutiny from representation, and so on. We were in danger of being left with so many different bodies doing different things that the public would be even more confused than we as politicians might be. A number of these amendments try to bring some of this together.

Various approaches are reflected in the amendments. The first one, which is reflected in Amendments Nos. 36, 85 and, to a degree, 88, is more or less a return to a reformed status quo. The amendments try to indicate that the way forward is to build on the existing CHCs. It is probable that too much water has gone under the bridge for that approach to be the right one to adopt. Nevertheless, in passing many of us believe that that is the approach which the Government should have adopted originally, and if at later stages of the Bill in this House the Government do not demonstrate flexibility, that might be the approach that we would be forced to take, simply because there would not be time to adopt a structure which would build in more of the powers and safeguards that we believe are right. I simply place that on record for the benefit of the Minister.

The second approach is not to be very prescriptive about the way forward. Amendment No. 139 attempts to put together something along those lines. One may say that reform is necessary and the Government should have powers to achieve it. That does not appear to be wholly satisfactory, since obviously Ministers are given far too much discretion on which to build. Nevertheless, it has the benefit of preserving the CHCs in a transitional period and would allow the Government to take rather longer over this somewhat hasty set of reforms.

The third approach, which, for the purposes of this Committee, we on these Benches prefer, is to try to pull together and add to the powers of the patients' forums and patients' councils to give them some additional meaningful powers and duties. In particular, would commend to the Minister Amendment No. 92, which provides for independent advocacy services to be brought into the net of the patients' councils. We believe that it is very important that there should be a clear nexus between the two. That nexus is not sufficiently clear under the terms of the current Bill.

We believe that further, more radical restructuring is required so that the patients' councils, rather than the patients' forums, become the units on which we can build. The patients' forums are in danger of proliferating. If we had a patients' forum for each trust, we would have a large number of patients' forums, which would make it difficult for members of the public to identify who was leading in terms of consultation, representation, etc. We believe that the patients' councils should form the key units, with the patients' forums essentially bolting underneath them.

Amendment No. 94 grants further power to the councils. Amendment No. 97 includes coverage of the complaints system, which we believe is a very important function performed (perhaps non - statutorily) by the CHCs and should be continued by the patients' councils. In passing, we also believe that the complaints system should cover not only acute trusts and other parts of the NHS but also care homes and the independent healthcare sector. We have previously debated that point. However, I believe that the Minister's reaction to it would be of great benefit.

I should emphasise certain key points about these amendments, many though they may be. I think that if the independent advocacy services were pulled under patients' councils, we should have made great progress in this matter. In addition, if the oversight of the new complaints system, however it is shaped, were in the hands of patients' councils, many of us would feel much more sanguine about the scheme that the Government have adopted. I beg to move.

4.30 p.m.

Earl Howe

I rise to speak to my amendments included in this group, namely, Amendments Nos. 85 to 88, 90 to 95 inclusive, 97 and 319.

Those amendments, like those of the noble Lord, Lord Clement-Jones, leapfrog us forward to Clause 13. Perhaps I may begin by saying that, in tabling almost every one of my amendments to this part of the Bill, my main aim was to try to make the structures proposed by the Bill more coherent, less confusing, and generally more joined-up. These amendments to Clause 13 are perhaps the most important in that category. Although at first sight they may seem complicated, they are in fact designed to rationalise and improve the fragmented arrangements that otherwise appear to lie in store for us.

The Minister knows my strongly-held views on CHCs. There are effective ones and less effective ones. The best are excellent and achieve a very great deal on behalf of patients and the community. Others have not made such an impact. Unless I misrepresent him, I believe that the Minister is of the view that CHCs overall have failed to live up to the promise that they generally enjoyed when they first started in 1974, and that he uses that argument to justify their abolition.

My view is different. I believe that the rational approach would be to consider the powers and functions of CHCs, decide what are their good points and which of them are worth preserving, decide also how they are deficient, and then work towards reforming them.

As currently constituted, CHCs have a great deal going for them. Perhaps their most obvious useful feature is that they are a one-stop shop. They combine the role of watchdog with that of complaints handling. They have the right to be consulted in the planning and operation of services and to make recommendations about those services. They inspect premises, including private sector premises. The best CHCs have established advocacy services as part of their day-to-day functions. Every CHC has the precious privilege of a direct line to the Secretary of State. Above all, they are valued, and hence respected, because they are independent.

I therefore suggest that the extent to which the CHCs have failed to deliver is not the fault of their structure. It has much more to do with the level at which they have been resourced and the fact that their powers are not sufficiently all-embracing. Advocacy has never been a statutory duty of CHCs, but many CHCs have either supported or provided advocacy services. We should try to build on that.

It will not be an easy task to reshape this Bill to give effect to what I have just said. However, I believe that it is possible to take a number of the Bill's provisions as the starting point for effective reform. In so doing, we should aim to deliver both what the Government would like to see, which, I take it, is an enhanced degree of involvement and empowerment for the patients and the public, and what I would like to see, namely, a way of building on the inherent advantages and merits of CHCs, and, in that process, provide better and more effective CHCs. Like the noble Lord, Lord Clement-Jones, I suggest that the way to achieve that is through patients' councils. I believe that CHCs, if reborn as patients' councils, would be a major move in the direction of rationalising the fragmented structures currently proposed by the Bill. That rationalisation would also serve to reconcile what I fear is an otherwise irreconcilable gap between us and the Government. Patients' councils would preserve the existing structures for patient representation and advocacy, except that independent advocacy would become a new core function.

To give effect to this, I have transposed the key elements of Clause 17 to Clause 13, with the notable additional feature that the advocacy role undertaken by patients' councils would extend to patients of private hospitals and care homes. Patients' councils would be able to report and make recommendations to NHS bodies, to local authorities and to the Secretary of State, thus facilitating the essential sharing of information. Like CHCs, they would have a statutory right to be consulted by health authorities, and they would have the right to whistle blow.

I suggest that it would make a great deal more sense if patients' forums, instead of being separately constituted bodies, were established as subcommittees of patients' councils. In that way, there would be absolutely no doubt in the public's mind as to the independence of patients' forums, which, rightly or wrongly, I fear may be an issue in the future if the Government proceed. Under my model, there would be no prospect at all of the members of patients' forums feeling isolated or lacking in proper support.

One of the beauties of that approach is continuity. Looking at the Government's proposals, I confess that I am worried about the transitional arrangements that may be put in place, and about the expense of running two systems in tandem, which for a while would doubtless be necessary. The benefit of enabling CHC personnel, with all their expertise, to continue in post would be obvious. As I said at the beginning of my remarks, these amendments may seem daunting. However, I hope that the logic is clear and that the Government will take them in the constructive spirit in which they are offered.

Baroness Cumberlege

I strongly support my noble friend's amendments. There is a feeling, which I am sure the Minister will seek to dismiss eloquently, that the proposals now tabled have not been very well thought through, and that one structure has been piled upon another to resolve any problem that exists. I have tried really hard to get through this issue. Your Lordships will know that I am a slow learner. I have looked at the whole issue from a patient's point of view. I am not looking at the matter from the point of view of a community health council, but from that of a patient, a complainant, someone seeking redress.

I have called my patient Mrs Archibald. Mrs Archibald, aged 80, suffers a stroke one night. Her relatives contact her GP who refuses to come out. They dial 999 for an ambulance. There is a long delay before the ambulance arrives. On arrival at the hospital Mrs Archibald is left on a trolley in the A & E department for three hours before being seen by a doctor. She spends a further 14 hours before being sent to a surgical ward. That is because the medical wards are full and there is no dedicated stroke unit. Her stay in hospital is three weeks longer than necessary as no suitable place can be found to meet her very dependent needs. On leaving hospital she is inappropriately assessed. She is sent to a residential home instead of a nursing home which she requires.

That short vignette raises six associated policy issues: first, the access to a GP out-of-hours; secondly, the response times of the ambulance service; thirdly, the performance standards in the A & E department; fourthly, stroke care; fifthly, delayed discharge; and, sixthly, quality and multi-disciplinary continuing care assessment.

As is so often the case with complainants, Mrs Archibald's daughter is keen that no other patient should endure what her mother has suffered. She wishes to prevent that happening by making a complaint. She has heard of the PALS system, but since this case arose at night none was on duty. The Minister would agree that even if they had been on duty, it is doubtful whether they would have been able to persuade a GP to turn out at night. The ambulance trust PALS and the PALS in the hospital would have had a problem to expedite the ambulance or to overcome the shortage of beds that night.

In this case three patients' forums have a policy remit: the PCT forum, the ambulance trust forum, and the hospital trust forum. Mrs Archibald's daughter goes to the patients' council with her complaint. The council "anonymises" the details and sends the complaint to the three chairs of the three forums. Each chair is a non-executive director of the corresponding trust. Each forum discusses a section of the complaint relevant to that trust and asks the respective chair to raise the issue at the next trust board meeting.

The chair of the hospital forum is reluctant because it has recently had a great deal of bad press over its A & E service. The trust chair has instructed all the non-executives to try and promote a positive image. The forum non-executive agrees to raise the issue in the private part of the meeting after the press and the public have been excluded. However, that means that he cannot report back to the relatives as he has a duty to keep the discussion confidential.

The PCT forum's non-executive raises the issue of GP out-of-hours services. Although, through the health authority, the board can influence the generality of out-of-hours services, it cannot influence the services a GP directly provides because he is an independent contractor. There is no patient's representative on the health authority to raise the policy issue.

The ambulance forum non-executive raises the issue of response times. The board agrees that it needs more money from the commissioning bodies to improve these times, but it does not know if it will be forthcoming and "unbadged". There is no forum where discussions on delayed discharges and multidisciplinary assessment can be raised.

Mrs Archibald's daughter is advised to raise these policy issues with a local authority scrutiny committee. She could also write to the PCT forum concerning the NHS element of the multi-disciplinary assessment. The scrutiny committee discusses the delayed discharge and agrees that it is very unfortunate that the council's cabinet decided to cut the social services budget. It will make a report to that effect. It does not have time to consider the issue of multi-disciplinary assessment as its work programme is over-committed.

The relatives are thoroughly dissatisfied, but they have no redress against the scrutiny committee for its refusal to consider these matters, although, of course, I suspect that they will vote against their local council in the next election. In the meantime, the exhausted daughter is becoming increasingly concerned about the council's residential home and the inappropriate care given to her mother. She seeks out the independent advocacy service provided by the patients' council. The advocate is employed by the local authority, either directly or through the patients' council. The advocate is clearly nervous about giving even informal advice about the local authority issue as his contract is held by the local authority. In addition, he has no remit over the care sector. The complaint process continues for 18 months and the relatives finally give up.

Noble Lords will agree that this is a monolithic labyrinthine system compared with our present system—a one-stop shop, locally-based, accessible and known to the local community, with statutory powers. The Government are proposing three sets of PALS, three different forums, a patients' council, a local authority scrutiny committee and an independent advocacy service.

At the moment, Mrs Archibald's daughter could deal with one body which is able to handle all aspects of the problem except the quality of care in the residential home. That is an issue that needs to be addressed, and has not been addressed in the Bill. Within CHCs lines of accountability are very clear. In these proposals there is an inbuilt conflict of Interest between the non-executive appointees to the trust board and their loyalties to the forum. Even the Institute of Directors questions how corporate responsibility can work with this half-baked system. Furthermore, as Elizabeth Manero is quoted as saying in this week's Health Service Journal, the independent advocacy service, if commissioned by local authorities as suggested in the Bill, ensures a conflict of interest between representing users of joint health and local authority services.

CHCs have been seriously unpopular with the Secretary of State, but were lavishly praised by the Prime Minister. When the CHCs celebrated their 25th anniversary the Prime Minister's agent wrote: Tony would certainly like to add his congratulations to the work the CHCs have done over the last 25 years and wishes them every success in the future". Those are odd words to choose when signing a death warrant.

And the Secretary of State continues to plot that death sentence. The truth is that the CHCs hold the truth— how it really is—and the Government cannot bear the criticism.

As Donna Covey, the director of ACHEW, in an article by Anthony Browne, the health editor of the Observer, said: Getting rid of the CHCs will not get rid of the problems for the NHS, but it might make them more difficult to detect". She is right. In all public services we need a regulator, an independent scrutineer to detect the problems. It is right that they should carry out surveys of trolley waits, waiting times for out-patients' appointments, dirty kitchens and so on, but the big picture is often gleaned from the individual complaint.

It was complaints to the CHC which brought to light events at the Bristol Royal Infirmary, the Alder Hey Children's Hospital, and the situation of Mr Rodney Ledwood, Harold Shipman and others. An article in The Times headed "Complaint by patient uncovered list scandal". which appeared last Saturday, stated: A telephone call from one disgruntled patient led … investigators to discover the waiting list scandal at Stoke Mandeville Hospital. The patient was fed up at hearing official claims that only a handful of patients nationally were waiting longer than 18 months for treatment". That is the point. Every government are prone to exaggeration of their achievements. Claims are made and when probed turn out to be somewhat fragile. A complainant needs the confidence that there is an independent body which will not only take up his complaint but will piece complaints together to build a big picture.

Finally, it is surprising that the General Medical Council, the BMA and other professional bodies have been championing the retention of CHCs. One might think that they were an irritant to such bodies. That is not so. They recognise that CHCs, with their coherent and comprehensive role, are a safeguard to maintaining quality in clinical care locally and, with the establishment of a national body to which we shall come later in the debate, nationally, in providing the big picture.

I strongly support the amendments put forward by my noble friend. They aim to bring the system together in order to be coherent, to be more joined up and to give patients a chance to understand the complaints system and to have confidence that it will be really effective.

Lord Weatherill

I support what the noble Baroness, Lady Cumberlege, said about the amendments proposed by the noble Earl, Lord Howe. As the Committee may know, I represented the Borough of Croydon for many years and I have been urged by Croydon Council to participate in this debate. I shall do so briefly because I am not the kind of expert in these matters that the noble Baroness is.

What has been said is absolutely right. The amendments would give continuity to the present system, in contrast to what the noble Baroness said about the various other bodies that would be involved if the Government have their way in this matter. Croydon Council recently passed a unanimous resolution. My contribution will be to read it to the Committee. It states: This Council is proud of the way that the Croydon Community Health Council provides a strong and independent voice for the people of Croydon on NHS matters and is proud of the way that the CHC carries out its functions as the local watchdog. This Council judges that the involvement of an independent watchdog role is essential in helping the Council undertake its proposed new responsibility for scrutiny of the NHS and in adding cohesion to. and commanding public confidence in, other initiatives proposed in the NHS Plan. This Council encourages the Healthy Croydon partnership to include the expertise of the present CHC in developing a future model of health scrutiny and patient advocacy in Croydon". I suspect that that resolution, if not passed by other councils, will be equally strongly felt by them. It is in that spirit that I warmly support this group of amendments.

Lord Peyton of Yeovil

I agree with every word said by my noble friend Lady Cumberlege, who served with distinction in the Department of Health and therefore knows far more than I do about this matter. I hope that the Minister will take note of what she said and will perhaps be influenced by it.

We are in a slightly awkward position. I make no criticism of the noble Lord, Lord Clement-Jones, but we are discussing an amendment which suggests that the community health councils should be given extra powers. Later in the Bill, however, community health councils are to be abolished. I should like to ask the Minister two questions. I hope that his answers will be fairly specific. What have community health councils done wrong? I do not include under the heading of "wrong" becoming a thorn in the flesh of Ministers. Ministers frequently deserve and fully earn the painful injection of a thorn in the flesh. I would not object to that. I want to know what the Government hold against community health councils, apart from the fact that they are a source of inconvenience to themselves. What I am driving at is that I do not believe that causing inconvenience to Ministers is necessarily or indeed at all a cardinal sin.

The Bill is in such a muddle that I do not know the correct order in which to take matters. In dealing with the abolition of community health councils, we have left on one side for a moment the question of scrutiny committees. The very thought of scrutiny committees, directed by Ministers, is a source of horror to me. I very much suspect that, like many such committees, they will consist of a mixture of people whose time would probably be better used elsewhere and people with nothing better to do elsewhere who find themselves on yet another committee.

I do not claim the knowledge of my noble friend, but I am chairman of two charitable trusts. As such, I fairly frequently go to hospitals and universities. In both I hear the same lament—that there is too much bureaucracy and too many committees. I do not see in the Bill any remedy to that. Perhaps I may remind the Minister that not long ago I asked a Question. It was a very unfair question. I asked the noble Lord how many committees were sitting under the aegis of the National Health Service. Very reasonably, the noble Lord said that he did not know. No blame is attached to him for that. My Question was the height of optimism. The only thing that could have been slightly worse would have been to ask him to say how many grains of sand there are on a piece of sea shore. Somewhat naturally, the noble Lord gave the very honest answer that he had not the slightest idea. I urged him then to get out his gun and shoot a few of them.

Lord Hunt of Kings Heath

If the noble Lord recalls, I offered to set up a committee to see whether we could find out the number of committees.

Lord Peyton of Yeovil

If the noble Lord had been prepared to arm that committee with penal and terrible powers, I would have supported him.

I have two questions. First, why are the Government displeased with community health councils? Secondly, is it the intention—this is my suspicion—that in future scrutiny committees will be asked to fill the role now carried out by community heath councils? I should be grateful for answers to those two questions.

Lord Rea

With this group of amendments and his introduction to them, the noble Lord, Lord Clement-Jones, has given us an opportunity to canter around all the various successor bodies that it is proposed will follow the CHCs. Grouped together, the amendments begin to provide a rational framework as to how they should relate to each other. I hope that my noble friend has given them serious scrutiny.

I very much commend the linking of the functions of the independent advocacy services with the patients' councils so that the councils can learn the lessons that come from patients' complaints to the advocacy services. Similarly, at a lower level, the patients' forums will be able to pick out from the trusts—even perhaps liaising with the PALS—some of the more local complaints and feed them up to the patients' councils themselves. I hope that that will fulfil many of the functions presently undertaken by the CHCs. As we come to later amendments, we shall be able to examine this in more detail. However, I believe that this general framework provides an extremely good start.

5 p.m

Baroness Masham of Ilton

Great concern has been expressed that the patients' forums and councils will not be independent of the health trusts. To feel comfortable, patients or their representatives need to be totally independent, as should the members of any body representing patients. At the moment, CHCs can delay the closure of hospitals rather in the same way that the House of Lords can delay legislation. I should like to ask the Minister this: can the bodies being proposed by the Government delay hospital closures?

I feel that the Government should build on CHCs to make them more effective. Sometimes patients need easy access to help and advice. They need to know where to go without the risk of confusion. I agree with the noble Earl, Lord Howe, that there should be an overall watchdog for all patients, NHS or private.

The Government's proposals here look very fragmented. That is just what patients do not need. We should seek to avoid confusion and fragmentation. Surely, this is something that, with the goodwill of the Minister, we can get right in your Lordships' House.

Lord Harris of Haringey

The noble Earl, Lord Howe, suggested to my noble friend Lord Hunt that the reason why the Government have proposed the abolition of the CHCs is that they had failed to live up to their early promise in 1974. However, I have to say that I am not clear about exactly what was that early promise. If one reads the documents produced at the time, it is clear that, as the concept of community health councils was being created—the aim was to reintroduce a level of democracy into the health service because the then government had removed great chunks of it during that year's reorganisation—bright civil servants thought of many new duties which could be given to the new bodies.

The reality was that CHCs were created as a hotch-potch of powers and responsibilities, none really worked through. Interestingly, a parallel can be drawn with some of the proposals before us in that it is clear that an incremental approach was then adopted as regards what CHCs should do, just as the proposals before us today have grown considerably from those originally contained in the NHS Plan. However, the result of that difficult beginning for community health councils—here I am conscious that my noble friend Lord Hunt was one of the foundation CHC chief officers at the time—is that a series of problems was inherent in the operation of those bodies.

First, although CHCs were more independent than the proposed PALS might be, they were not truly independent of the local health authority structure. I hope that, during the course of our debates in your Lordships' House, it will be possible to ensure that whatever is brought forward to replace CHCs is given genuine independence from the local NHS structure.

Secondly, concerns were expressed about resources. I can recall reading a report on CHCs which described them as bodies comprising one man and a dog. The expression was decried at the time for being rather sexist. Perhaps more pejoratively, they were described in terms of, "How many times can you re-use a teabag?". That indicates the extent to which resources were limited. Over time, successive governments have made available rather more resources to CHCs, but in reality an enormous expectation has been placed on what CHCs could achieve without necessarily providing the resources to ensure that such expectations could be met.

However, the biggest weakness here, and perhaps the reason why successive governments have considered this problem—we should be clear that over the past 20 years, successive governments have considered the abolition of CHCs—is the fact that no proper mechanism was built into the legislation concerning the quality control and performance management of CHCs. As a consequence, a wide variation has grown up in the way in which CHCs interpret their role and the quality of the work they undertake. That is a strong reason why a number of people, including myself when I was the director of the Association of Community Health Councils, acknowledged that it was important to reform the CHCs and to develop their role in addressing relevant issues.

It is clear that widespread dissatisfaction was felt both in your Lordships' House and elsewhere with the initial proposals that emerged from the NHS Plan. However, major developments have taken place and the Bill now before noble Lords is nearly there in terms of addressing some of those issues. That is why I have some difficulty with this group of amendments. As the noble Lord, Lord Clement-Jones, acknowledged, we have in effect an à la carte menu of ways in which the problems in relation to CHCs or the Government's proposals might be addressed. Indeed, while listening to the noble Lord's speech, it was difficult to work out exactly which of his à la carte amendments he was interested in pursuing and which had been added merely as fallbacks in the event of, say, the first 15 proposals failing for one reason or another.

Nevertheless, the noble Lord made certain key points, one of which was that it is essential that the principle of independent advocacy, properly made available to the public, should be enshrined in the Bill. That is entirely consistent with the general objectives set out in the NHS Plan. But the manner in which the proposals are presently contained in the Bill, following amendments made in another place, does not make it absolutely certain that such independent advocacy arrangements will, in practice, be independent of the local trust or the local service. That must be remedied, whichever of the à la carte amendments is favoured or in terms of whatever response to the debate will be made in due course by my noble friend.

I believe that it would make sense for those independent advocacy arrangements to fall within the ambit of the new patients' councils. That is important because one of the main strengths of CHCs has been their ability to draw from their experience, based on the wide range of functions they perform, and to learn the lessons. They have learnt both from their advocacy work and from their complaints work. For that reason, it would be extremely sad if the independent advocacy arrangements to be put in place do not permit the learning of lessons from cases being pursued, so that those results can be applied elsewhere in the health service.

We need to address one other point: the question of independence. During the debate on Second Reading, I referred to the strange position of the staff of CHCs. We have an opportunity, during our discussions on these amendments and other amendments later this evening, to address precisely that question. We must ensure that we do not put in place the strange situation where staff are seen as accountable at a local level to the local health service. Furthermore, the question of resources needs to be taken away from the local decision-making process. It needs to be seen as something that will not be dependent on whether the CHC or patients' council—or whatever body is finally agreed on—has offended local NHS managers.

Major changes were made to the Government's proposals in another place. First came the specific proposal to set up a patients' council in all areas. That clearly signals the need to build a structure which is at least as good as, if not better than, the existing arrangements. The second change was the introduction of the clause about independent advocacy, which, as I said earlier, is nearly there but not quite enshrined. There is a lack of clarity, and that is why changes need to be made.

The noble Baroness, Lady Cumberlege, who spoke about the worthy Mrs Archibald and her problems, suggested that what we have before us today was not thought through initially and is still not thought through. We have the opportunity in this debate and in considering the amendments to make sure that the system is integrated; that it works better than the existing arrangements through CHCs; that it is genuinely independent; and that it provides a seamless service for members of the public who wish to make complaints.

The noble Baroness, Lady Cumberlege, is wrong to suggest that Mrs Archibald's family would have to pursue these matters through a number of patients' forums, through the independent scrutiny committee on the local authority and through the patients' council. We need to make sure that the arrangements for individuals who have complaints and concerns that they want to pursue are seamless. We must make sure that the final proposals which emerge from the Committee address all of those questions and that the arrangements are seen to be independent and properly resourced and enable members of the public to be satisfied that they will get a seamless service.

Ultimately, we must make sure that the lessons learnt from those cases and the lessons learnt by members of the patients' forums and the patients' council are properly utilised so that we end up with an NHS which is better because of the interventions of those bodies. That is a prize we can achieve. In going through these amendments—it is unfortunate that they are grouped together in this way—we can pick out the various elements and ensure that they are addressed.

The Earl of Listowel

I support the amendments of the noble Baroness, Lady Cumberlege. Speaking as a volunteer, I decry the way in which the community health councils—which are mostly staffed by volunteers—seem to have been treated by the Government. The perception is that they have been abruptly discarded without consultation or consideration. I have other reasons for supporting the amendments, which I shall come to as we proceed. At this point, I simply state that involving community health councils in the new arrangements—for instance, giving them charge of the independent advocacy service—would be a good way to recognise the work of volunteers and staff in the past. I support the noble Baroness's amendment.

5.15 p.m.

Lord Hunt of Kings Heath

This has been taken as a debate on the principle surrounding the abolition of community health councils and the arrangements that we seek to put in place to provide an enhanced mechanism for public involvement and representation in the National Health Service.

My noble friend referred to my background in community health councils when they started back in 1974–75. It was an exciting time because the NHS was not used to the concept of user or patient involvement. My noble friend is right. Some of the community health services which were previously run by democratic local government were brought over for the National Health Service to run. Certainly my experience in those first two years was quite exciting in terms of developing this new concept, of seeing the impact that it had on the culture of the NHS—community health councils were quite a culture shock for the health service—and, importantly from my point of view, of encouraging the NHS to think rather more than it ever had before about how the delivery of its services impacted on individual members of the public.

I have no hesitation in saying that the work of CHCs over those 27 years has been positive; that people have been helped; and that the NHS has been encouraged to start to look at changing its culture. But, at the end of the day, can we absolutely say, in 2001, that the NHS is sufficiently patient and public orientated? Can we really say that it is a health service which really deals with issues and complaints as immediately as it ought? The record is that we still face many issues and challenges in attempting to make the NHS as user and public friendly as possible.

I fully accept that there is a choice. Is it better to reform and change CHCs—I certainly pay tribute to my noble friend for the work that he did at the ACHCEW in establishing a fundamental review of CHCs—or is it better to produce a new and better system of patient involvement and representation? The decision that the Government have quite clearly made is that we want to start to build a new system.

The noble Lord, Lord Peyton, asked what CHCs had done wrong. Had they been too inconvenient to Ministers? No, that is not the purpose of the changes. We are making the changes because we believe that what will come through will be a much more powerful public involvement in the National Health Service and that the National Health Service itself will have many more incentives to change and improve the way in which it delivers services to the public. That is the test on which these proposals should be based.

If we go back to the NHS Plan and the widespread public consultation that we held, there is no doubt that we had a lot of comments coming back saying that the NHS was poor at dealing with complaints on the spot; that people did want the option of independent advocacy to support patients wishing to make formal complaints against the NHS; and that they did want to have an input and influence over local decisions about NHS services. It is my contention that the proposals we are putting before the Committee will enable us to do that more effectively than community health councils.

I suspect that Mrs Archibald will be with us for quite some time today. I do not believe that it is possible to say that under the current arrangements Mrs Archibald would be well served. Surely it is a reflection of the problem of getting the NHS sufficiently user conscious and involved that the noble Baroness was able to raise this example. I agree that the new arrangements need to be able to deal with the kind of issues that Mrs Archibald faces; I believe that they will do so in the first place when it comes to patient advocacy and liaison services.

This is an exciting proposal: a new, trust-based, front-of-house customer service for patients and their families. I came across this kind of service in the US some 15 years ago. There are compelling reasons why we need it in the NHS as soon as possible. The record of the NHS is that very often people come into hospital or into our community health services and find that there are problems. However, they feel inhibited from raising them or they raise them only through a formal complaint some weeks later. If we had a mechanism which enabled us to deal with those kinds of issues on the spot as they arise, surely we would have a much more effective healthcare system. That is what PALS is all about and why we are implementing PALS from April this year, starting with the major hospitals and rolling out the service during the year to cover all NHS and primary care trusts. It will be a new core service for trusts. It will guide people through the system, provide information about the services of the trust, and help to resolve problems as they happen rather than after the event.

As part of that service, PALS staff will have direct access to the chief executive of a trust, with the ability to facilitate the swift resolution of problems. I cannot stress too strongly the importance of that. The people who are charged with trying to sort out problems as they arise will have access to the top management of an organisation.

But it will not always be appropriate for PALS to be the body that deals with patient complaints. Clearly, some people—perhaps after dealing with PALS, and others who may not wish to use PALS at all—will feel much more comfortable with independent help. That takes us to Clause 17, which places a new duty on the Secretary of State to arrange the provision of independent advocacy.

We have not been prescriptive about who should provide that advocacy. We want as much flexibility as possible, and we want to build on many of the excellent advocacy arrangements that already exist throughout the country. What is not in doubt is our assurance that this will be an effective, independent service, and one that will be able to deal with the different issues raised by Mrs Archibald.

At trust level, we are also setting up patients' forums. They will be the local route into the decision-making processes for patients and the public. They will be made up of patients, carers and representative organisations through a process that will be agreed by the independent NHS Appointments Commission. In addition, these patient forums will be able to appoint a member to the trust board to which they relate. That will give a voice to patients at the top level of their local national health service.

Again, I make the point that patient forums will be independent. They will be responsible for monitoring and reviewing the services to which they relate. They will also have a duty to seek the views of patients and carers in their area and will report them to the local NHS trusts. They will be able to make recommendations to NHS bodies about services, basing these on an inspection of services that they have conducted and what they have heard from people who use those services.

The noble Lord, Lord Clement-Jones, accused me of wanting to proliferate patient forums. But surely this is the whole benefit: for every NHS trust there will be a patient forum which will be able to bring the concerns of patients to the attention of senior managers and the trust board. Because those forums are basing themselves on the services of a particular trust, they will be able to focus very much on the concerns of patients using those services. That will be a great advance. It will enable forums to exercise a great deal of influence over the NHS.

In addition, another key role of the forum will be to report on how the NHS is fulfilling its duty under Clause 11, dealing with arrangements for consultation and the involvement of patients, their carers and representative organisations in the decisions that the NHS makes and in proposals for changes in the way in which services are provided.

I understand and hear the concern that because patients' forums will relate to each individual trust they might become isolated and might not relate to patients' experience across the range of local health services. I certainly accept that there is a need to co-ordinate the work of patients' forums to ensure that they take what might be described in the jargon as a "whole systems" view of services for patients.

That is why we accepted an amendment on patients' councils in another place. These are made up of members from each of the local patients' forums. The council will make reports to the health authority, to trusts, to the local authorities and to their overview scrutiny committees. Their role will help the forums to co-ordinate their work, to share experience and to consider the views of patients across the range of services. They could even provide independent advocacy services and will certainly be consulted on the best arrangements for providing independent advocacy in their local area. To make all this work in a co-ordinated way, the patients' council will share a secretariat with local patients' forums, strengthening their links.

This is a real and useful role for patients' councils. However, I do not believe that it supersedes the role of the patient forum. We see the patients' forum as having the crucial relationship, bringing the NHS and patients together. The patients' council will necessarily have a more distant relationship. It will deal with many trusts and will take an interest particularly in the health authority's strategic decision-making process.

That is why I do not find myself in sympathy with amendments which seek to make the patients' council the pre-eminent body for representing patients, with the forums as sub-committees. I believe that it is much better that the key body in all these arrangements at local level is that of the forums, which are very much based at the patient care level. The patients' council can pull together views and can co-ordinate the forums, but the forums themselves should be the key building blocks.

The noble Lord, Lord Peyton, asked me to discuss overview and scrutiny committees, and we shall debate amendments on the subject in due course. They provide another piece of the jigsaw. It has always been a criticism of the NHS that at local level it has had what has sometimes been described as a democratic deficit. It is often proposed, particularly by local authorities, that the NHS should be run by them so that decisions may be made through the ballot box, legitimised by local councils.

Governments of both parties have always rejected that proposal because of the essential national nature of the National Health Service. But there is no doubt that local government has an important role to play, both in putting forward views about the health service and in ensuring good co-operation between the NHS and local government.

The overview and scrutiny committees will be committees of the principal local authority in an area. They are consistent with what is happening in local government generally in the establishment of such committees to monitor the normal local authority provision. I believe that they will be very powerful in ensuring that what happens in the NHS is very much open to public scrutiny and examination by local authority councillors. If one were looking for an example of where the proposals we are placing before the House are much more powerful than those that currently exist, that is surely it.

The test of all these proposals is whether, at the end of the day, there will be more effective patient and user representation within the NHS at local level. I have no hesitation in believing that the answer to that is yes.

Baroness Masham of Ilton

Before the Minister sits down, perhaps I may ask him about delaying the closure of hospitals. Will any of these bodies be able to do this?

Lord Hunt of Kings Heath

I apologise to the noble Baroness for not responding to the specific point that she raised. The role of community health councils in relation to major changes in services will be transferred to the overview and scrutiny committee of the local authority. If a proposal for a major change is made with which the overview and scrutiny committee disagrees, it will be referred to a panel, or an advisory committee, that we are establishing at national level called the national reconfiguration committee, which will then make recommendations to the Secretary of State. Therefore, in essence, the new local authority overview and scrutiny committee will have that responsibility in the future.

5.30 p.m.

Baroness Masham of Ilton

Would those at national level know the nature of local needs?

Lord Hunt of Kings Heath

At present, if a CHC objects to a major service change, such an objection is referred directly to the Secretary State. The new provision will establish an advisory committee to enable the Secretary of State to receive the advice of experts on such a proposal before he reaches a decision on the matter.

Lord Harris of Haringey

Perhaps I may intervene before my noble friend sits down. He started his response by giving us a fairly lengthy account of the strength of PALS. I am well aware that my noble friend has been a long-term advocate of such arrangements. However, does he accept that the PALS arrangements, which, I am sure will be a very valuable part of "customer relations" for a local trust, are not the same as independent advocacy?

I believe that my noble friend said that it would not always be appropriate for the body dealing with patients' complaints to be the PALS. I am quite worried by those remarks. I should be grateful if my noble friend could further clarify them. We must be quite clear that the handling of complaints, and advising and supporting complainants, must be independent of the trust concerned.

My noble friend also said that the Government did not wish to be prescriptive about who should provide advocacy. Would my noble friend think it appropriate to place some residual duty on the patients' councils to satisfy themselves that appropriate advocacy arrangements are in place and are strong enough so that, if they are not satisfactory, the patients' council can provide the service?

My further point relates to the relationship between patients' councils and patients' forums. My noble friend said that patients' councils should not be pre-eminent in terms of patient representation at local level. I believe him to be wrong in that respect. Given the fact that my noble friend has acknowledged that there is a danger that patients' forums might be subject to isolation—indeed, almost subject to "agency capture", which I think is the jargon for it—can he tell us what form the arrangements will take? Who will be responsible for the performance management of patients' forums, who will set the budgets for them, and who will appoint and manage their staff?

Lord Hunt of Kings Heath

Perhaps I may respond—

Lord Peyton of Yeovil

As we are in Committee, I should point out that there is absolutely no reason to worry about whether or not the Minister has sat down.

I do not believe that I explained myself adequately when I spoke a short while ago. I am concerned with the ever-lasting business of inspection and scrutiny. Patients are mainly concerned with the ability of doctors and nurses to get them better. They are not so concerned with the cogs of administration. I hope that those at the sharp end of the NHS will not find themselves too much tortured by a machinery of complaints that requires them to spend an inordinate amount of time protecting themselves against all kinds of contingencies, and every possible complaint, no matter how unreasonable.

Lord Hunt of Kings Heath

I understand the noble Lord's concern; and, indeed, I have some sympathy with it. At the end of day, we need to have a proper complaints system, as well as a health service that is sensitive to the needs of the public and patients. That is the purpose of many of the Bill's mechanisms. Equally, if by prompt action—this is where the PALS come in—we can deal with problems as they arise, it may well mean that patients do not always wish to go through a formal complaints process because the problem has been resolved.

However, if patients wish to go through a proper complaints process, I can reassure my noble friend that the options will be open to them in the future, as they have been in the past: they can go directly through a formal complaints system, or, if they wish to have help to do so, they can go directly to the independent patients' advocacy service. There is no question about that. I believe that the PALS service will provide a very straightforward and easy route in many cases, thereby allowing problems to be put right as soon as possible.

My noble friend also asked about the secretariat for the patients' forum and the patients' council. Some of these issues will need to be developed because neither the forum nor the council will be able to employ staff directly. We shall need to find a mechanism through which such staff can be employed. That is not unusual because CHCs have found themselves in the same position. The intention is that the funding will come from the Secretary of State through regional offices. I do not believe that I can reassure my noble friend that I have a robust system of performance management at my finger tips. However, we shall be debating a number of these issues later. I can tell him that we shall wish to support the patient council and the forum and that we shall enable them to be as effective as possible in their work. Some of the work carried out by my noble friend in that area would be apposite to that aim.

Baroness Cumberlege

I do not want this Committee stage to be haunted by my fictitious patient, but the Minister said he felt that she would not be served well in the current situation. I should like the noble Lord to explore that comment. We need to know exactly what we are jettisoning, and what we are gaining in its place.

Lord Hunt of Kings Heath

The litany of failure outlined by the noble Baroness was a breakdown both in terms of services provided by different parts of the NHS and in terms of co-ordination between them. I should point out to the noble Baroness that there are examples of that happening at present. The existence of CHCs per se does not seem to me to have had an impact on the situation. Under the new arrangements, it is important to note that when, for example, the relatives of Mrs Archibald confront a problem they would have an avenue through which to raise it immediately. However, if that is not effective, there would be a way to ensure that all the different issues with which they have problems would be dealt with.

In the first instance, PALS comes into play in dealing with problems as they arise. However, if that does not work out and if, say, Mrs Archibald's relatives decide to go through a formal complaints process, that would undoubtedly be co-ordinated by seeking the help of the independent advocacy service.

Lord Harris of Haringey

I shall not make the mistake again of saying that I wish to comment before my noble friend sits down. Perhaps I may clarify a few points about independent advocacy. Clause 13(3)(c) refers to patients' councils carrying out, such arrangements as may be made with the Council under section 19A of the 1977 Act (independent advocacy services)". I presume that that will enable the Secretary of State, if he so wishes, to contract with the patients' councils providing independent advocacy services. However, in the light of what my noble friend said, can he say whether he expects that to be the normal arrangement—namely, to contract with the patients' councils to provide those services—or whether he expects that to be the exception to the rule?

Lord Hunt of Kings Heath

It is very difficult at this stage to say what will happen in practice. It is clear that the independent advocacy services could be provided in the way suggested; alternatively, they could be provided by another public organisation. Indeed, they could even be provided by a voluntary organisation. It is important to ensure that we have a robust, independent and effective service for the public. Of course, that responsibility rests with the Secretary of State. But before making any arrangements he will need to consult any relevant patients' council and such other persons as he considers appropriate. Whatever the arrangements are for the provision of those services, there will be an opportunity for patients' councils to express their views.

Lord Harris of Haringey

Would it not surely be better for the patients' council with local knowledge to have the residual responsibility for deciding where the contract should be placed locally to provide the most effective service for local people?

Lord Hunt of Kings Heath

Given the importance of ensuring that there is an effective service of consistent high quality throughout the country, that responsibility must rest with the Secretary of State.

Lord Harris of Haringey

I make one final point on a slightly separate issue. My noble friend said that he did not think it was possible at this stage to have a robust performance management system for patients' forums. I have some sympathy with that view. However, can we be clear that he accepts the principle that the performance management of patients' forums and, for that matter, patients' councils, must be independent of the local health service? If that is not the case a successful patients' forum and a successful patients' council may well be considered to be the one that gives the quietest life to local health service managers. However, it might well be argued that a more effective patients' forum or patients' council would sometimes give local health service managers a difficult time.

Lord Hunt of Kings Heath

I understand the point that my noble friend makes. That is why I emphasised the support that should be given to patients' councils and patients' forums when they are established to ensure that they do their job properly and to ensure that there is exchange of good practice between different parts of the country to enable them to draw on the best practice available.

Baroness Masham of Ilton

The Minister, who is an expert, sounded rather confused just now as to who to approach. I just wonder how on earth the poor patients will be able to find a way through the network.

5.45 p.m.

Lord Hunt of Kings Heath

I am sorry that the noble Baroness thinks that I sounded confused. The matter is very straightforward. If you go into a hospital and there is a problem in the outpatients department, you will have immediate access to the patient advocacy and liaison service within the relevant trust. I hope that that will sort out the problem there and then. However—

Baroness Cumberlege

Even at night?

Lord Hunt of Kings Heath

Of course, we shall have to make arrangements to ensure that there is access to patient advocacy and liaison services. That is an issue and a challenge to which every trust will have to face up. If that does not work out, or if an individual does not want to use PALS because he or she feels that it is more appropriate to make a formal complaint, the system will operate as now. He or she will make a complaint and that will be dealt with through the formal process. At the moment if someone seeks assistance, he or she can approach the community health council. In the future if someone seeks assistance to make a complaint, he or she can approach the independent advocacy service. As I say, I believe that the matter is straightforward. The individual will be given more leverage and power than he or she has had hitherto.

Lord Clement-Jones

This has been an extremely useful and important debate, as was demonstrated by the fact that so many Members of the Committee took part in it. The more Members of the Committee gave examples and teased out situations where certain provisions might come into effect, the more the doubts in my mind (which were already considerable) grew. Certainly those who have spoken have been sceptical about those provisions, to say the least.

The amendments tabled by the noble Earl, Lord Howe, and myself seek to join up the disjointed. I believe that the story of Mrs Archibald will live on in folk memory. It illustrated the situation well. The noble Lord, Lord Harris of Haringey, valiantly tried to illustrate that the CHCs did not have the help and assistance that it appears that some of the new services to be established under the Bill will have. The budget of the CHCs is something in the order of £20 million at present. The budget required by the new services may he over £100 million. That is outrageous. How effective could they have been if they had had the necessary powers? Will Hutton's commission on the health service—it was sponsored partly by ACHCEW—concluded that CHCs had inadequate powers.

There is not a great deal between us in terms of agreeing an effective outcome but there is a great difference between us in terms of mechanics. I fully accept that the amendments are rather à la carte, but we have given the Minister a chance to select out of that à la carte menu the provisions that he might consider attractive or at least those which fit in with his general approach. I suggest to the noble Lord, Lord Harris of Haringey, that the table d'hôte will come later if we are permitted a Report stage.

However, I am disappointed in the Minister's response. He said that we were debating a matter of principle. I disagree. As I made absolutely clear, we are debating the details of the powers and the joining-up of the different bodies. The Minister showed no willingness to effect more joining-up than has been evident heretofore. The Minister is aware of the need to be as public and patient friendly as possible and as public and patient oriented as possible—there are all kinds of different ways of saying the same thing. I am sure that we agree with that. We want more powerful public involvement in the NHS. However, we do not believe that that will be achieved at present. The Minister went into enormous detail over PALS. That demonstrates some of the difficulties. We had to clarify whether that was to be the normal way of proceeding with independent advocacy. Will patients' councils deal with that on a usual basis or an exceptional basis?

The noble Lord, Lord Harris of Haringey, teased out some interesting answers from the Minister to the effect that the Government do not appear to know at the moment how the system will work. However, if the system really hung together, the Government would know how it worked. Patients' councils should be able to plug into the complaints system.

Lord Hunt of Kings Heath

I do not have a blueprint for saying what proportion of independent advocacy services might be run by patients' councils in the future or might be run by other voluntary organisations as decisions have to be made as to what circumstances suit every locality. That is the responsibility of the Secretary of State. In fulfilling that responsibility he will seek the views of local patients' councils. Surely that comprises the taking account of local circumstances for which the Committee has asked.

The Earl of Listowel

I hope that the noble Lord, Lord Clement-Jones, will forgive me for interrupting him. However, what if a mother who does not speak English wishes to access the independent advocacy service? She tries to call NHS Direct but there is not an Urdu speaker to hand. Under the old system she would be able to go to the CHC—the shop front—with her child who perhaps can speak English and gain access to whatever service she needs. How will her need be met under the new system?

Lord Hunt of Kings Heath

It is interesting to note that the noble Earl assumes that in those circumstances every CHC in the country will be instantly accessible and able to respond to those demands. I think that that is most unlikely. With the availability of NHS Direct, and efficient, independent advocacy services, where the views of the patients' councils expressed to the Secretary of State that certain services need to be included are taken into account, one is more likely to have a mechanism for responding to those demands than at present.

The Earl of Listowel

I am sorry to persevere. Perhaps I have not understood the Minister correctly. It seems to me easier for a person to go to an office, perhaps with someone who can speak the English language, than for him to contact a disembodied person at the end of a telephone line in order to gain access to a service. However, perhaps I misunderstood the Minister.

Lord Hunt of Kings Heath

I think that there are four CHCs in Birmingham. Does the noble Earl seriously suggest that it is easier to find those offices, in a city of about a million people, than to have direct access to NHS Direct and then contact with an independent advocacy service?

The Earl of Listowel

I thank the Minister. I shall consider what he says. I am sure that we shall have an opportunity to discuss the issue later.

Lord Clement-Jones

In many respects, that illustrates clearly the total difference between the mindset of those who tabled the amendments on this part of the Bill and that of the Minister and his colleagues in the Department of Health. To me, local decision making involves local decision making: a patients' council has the ability to determine the kind of independent advocacy services it wishes to run, subcontract, commission and so on. To the Minister, it is the Secretary of State, with perhaps some consultation with the patients' council. That is decentralisation. It is extraordinary.

Lord Hunt of Kings Heath

I do not wish to prolong this debate. I am sure that we could carry on all night on these issues. The point is this. At present, support for the public in making complaint is too variable and patchy. Therefore, the Secretary of State needs to take the power to ensure that a consistent, high quality, independent advocacy service is available throughout the National Health Service. However, in doing so, he will take account of the views of local organisations, including patients' councils. Surely that is a sensible approach which involves the best of both worlds.

Lord Clement-Jones

We shall have to differ on that. The Minister's view is that no action is good unless the Secretary of State takes it himself. That seems an extraordinary view. Aneurin Bevan warned against the rattle of bedpans in the Department of Health. We are now faced with that situation. It seems extraordinarily centralist.

I warn the Minister that during its next stages these Benches will judge the Bill on whether it is clear where independent advocacy lies, or whether patients' councils and patients' forums have sufficient independence. The Minister asserted the independence but I have not seen chapter and verse of it.

The Minister made a virtue of proliferation of the various forums. However, he then said that they might become isolated. Why do we not cure that problem before it arises rather than building in mechanisms in case those bodies become isolated.

Lord Hunt of Kings Heath

A moment ago the noble Lord accused me of being over-centralist. With the patients' forum we are placing the key responsibility for patient involvement at NHS trust level. The noble Lord seeks to move that to a patient council which is one level removed from the patient.

Lord Clement-Jones

The Minister knows his constitution. Having considered centralisation or federalism, he knows that the great trick about devolution is to ensure that decisions are taken at the appropriate level with the right mechanism. We believe that the most coherent point at which that can be done is at the patients' council level. It can then be the coordinating factor. If we are not careful, patients' forums will lead to forum shopping. The experience of Mrs Archibald, cited by the noble Baroness, Lady Cumberlege, was telling.

I do not disagree with the Minister's aim regarding more effective patient and user representation. Indeed, we shall probably quote those words back at him when judging whether or not the Bill meets that criterion. We shall consider the total package. If it does not meet what we believe are necessary criteria, we shall act accordingly in later stages of the Bill. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 7 [Functions of overview and scrutiny committees]:

Lord Clement-Jones moved Amendment No. 37: Page 6, line 16, after "section," insert "the strategy for health improvement and action to address health inequalities

The noble Lord said: The posture of suspended disbelief probably applies as much to this part of the Bill, which precedes the provisions on the patients' council, as to the previous amendments. We wish to test whether the Minister is flexible about the way in which scrutiny will operate.

My local government colleagues in the party believe that these scrutiny provisions may work. As the Minister pointed out, the overview and scrutiny committee has become a central plank of the way in which local government now operates. With the institution of cabinet government at local government level, it is a different animal from a few years ago. Nevertheless, some issues need to be resolved. I suggest that conflict of interest may well need to be resolved as these scrutiny powers take hold.

However, I wish to note a few key gaps in the powers of the overview and scrutiny committees. Amendments Nos. 37 and 53 deal with overview of strategy for health improvement. That is an important area. The issue of making information available to patients' councils arises from scrutiny. CHCs were able to take a view about a pattern of behaviour or circumstances which informed the way in which they did their job. It is important to have that link between scrutiny and patient representation, and patients' complaints and patient advocacy.

The committees should be able to refer to other NHS bodies such as CHI and NICE, and to set up local inquiries. There should be the ability to co-opt observers from patients' forums on to scrutiny committees. Above all, there should be procedural standards for the scrutiny committees. That seems to be one of the weakest areas. It is important to have transparency about the operations of the committees. We need to know, for instance, whether the party whip will operate in these circumstances. I understand that planning committees have clear guidelines about the use of the party whip. I believe that it would be wrong for the party whip to operate where scrutiny of the local health service takes place. These are important additional issues which need to be dealt with. In moving the amendment, I speak also to Amendments Nos. 38, 41, 45, 46, 49, 50, 51 and 53. I beg to move.

6 p.m.

Earl Howe

Clause 7 is the first in a series of clauses that give effect to the arrangements outlined in the NHS Plan to introduce better local accountability for health services and to enhance the voice of patients and the general public. The Minister will not be surprised to hear that I still hold the view that I expressed on Second Reading that the arrangements are a mish-mash, despite everything that he has said on the previous group of amendments. I cannot make complete sense of the Bill as it stands. The Minister may be able to illuminate some of the dark corners of the Bill as we proceed, but I doubt that he can dispel my concerns entirely. Like the noble Lord, Lord Clement-Jones, I shall wish to return to these matters with vigour.

I hold that view because Ministers have approached the issue from the wrong direction. They have asked what structures might be invented to perform certain functions, whereas they should have asked what they were trying to achieve. The end result is a pile of structures. It was seven at the last count, although someone has told me that it might be nine if we include bodies such as the Secretary of State's reconfiguration panel.

Let me restate our objective. It is to examine the structures that the Bill proposes, look at what they are intended to do and then suggest ways of rationalising them so that they are more user-friendly and less bewildering than they are at the moment.

Clause 7 relates to the role of local authorities in enhancing local accountability. My problem with the idea of greater local authority involvement is not so much with the theory as with the practice. Local councillors are already stretched. They have limited time to do what they are required to do. That means that the real work on Clauses 7 and 8 will have to be done by the officers, who are already dealing with a host of other social services and health-related issues—not only the co-called Section 31 arrangements under the Health Act 1999, which permit local authorities and health bodies to collaborate, but also the arrangements adumbrated under the Bill for the formation of care trusts.

Many councils already find it difficult to fulfil their statutory child protection and adoption services in anything like a satisfactory way. In that context, the issue of resources rears its head almost immediately. Amendment No. 47 addresses that. Local authorities cannot do what the Bill asks of them unless they are given the financial wherewithal to do it. If they are not properly resourced, the whole exercise will fall down in a heap because it will not command confidence. If it does not command confidence, it will be useless. The first thing that the Minister needs to tell us is how he will ensure that this particular bird will fly. Not only do there need to be officers in place dedicated to servicing OSCs, there also need to be resources made available directly to those councillors who sit as scrutiny councillors.

Those new duties come hard on the heels of other scrutiny functions laid down in the Local Government Act 2000. Even before Part 2 of that Act has bedded down, scrutiny councillors will be required to extend their purview into non-local authority functions. That is a tall order.

The Explanatory Notes attempt to put a small amount of flesh on the bones of the clause, which is pretty skeletal by any standards. However, there are a number of important lacunae. What are OSCs there to do? If they are to count for anything, they must talk to the outside world a bit. They must talk to patient groups and, if they wish, to national bodies such as the Commission for Health Improvement and the Audit Commission. They must be able to set up local inquiries with the power to call for evidence. Those are functions that CHCs have at the moment.

The danger as the Bill is drafted is that OSCs will be cut off from everybody except the NHS. Unlike CHCs, they will not have the benefit of inspections to inform their scrutiny work, because inspections will be carried out by patients' forums. Unless patients' councils and forums have a duty to pass on relevant information, the OSCs will operate in a vacuum, or will at any rate have a very one-sided view of the world. When they have passed that information over, patients' councils should be able to call for OSCs to take action on whatever concerns they may have. All that is set out in Amendment No. 52. I expect such joined-up arrangements.

What happens once the OSC has reached a conclusion on a matter? Presumably, although the Bill does not say so, it will be able to make its views known to the local NHS body in question. When that happens, what is the NHS body obliged to do? Does it have to do anything? In Amendment No. 48, I suggest that it should.

All those matters should be the subject of advance consultation by the Secretary of State. Despite the smokescreens and bluster of various kinds, there has been no consultation on the detailed proposals for local authority functions, but there has to be consultation if the regulations are to prove work able and effective.

Amendment No. 43 relates to the effective use of time and skills. Subsection (3)(f) would require any officer of a local NHS body to attend before the committee to answer questions. My noble friend Lord Peyton referred to that provision earlier. I am worried about that on several counts. Obviously the OSC will need to be able to question the chief executive of a health authority or trust on occasions. It may also need to question other officers, but those officers cannot be made subject to the beck and call of the OSC every week of the year. The OSC is a lay panel. The officers of the health authority, trust or PCT are busy professional people. In most ordinary circumstances they must be allowed to get on with doing their job. The OSC should not consider that it has the right to summon officers of the trust willy-nilly without there being a good reason for doing so and without first being satisfied that the officer concerned can represent the trust or health authority at the most appropriate level. Even worse than summoning an officer for a trivial reason would be—I hesitate to say this—to have a scrutiny committee agenda for party political reasons rather than for the purpose of improving local NHS provision.

I hope that the Minister can reassure me that the tail will not be allowed to wag the dog in that sense.

Lord Harris of Haringey

I am an enthusiastic supporter of the clause, because it provides an important means of strengthening the role of local government. Providing for scrutiny committees to look at the health services in an area adds to the range of oversight and scrutiny committees in local government and is a valuable part of building the community advocacy role of local government. That role is contained in proposals for local government, but this is the first tangible sign that it will affect and impinge on other public services.

I was slightly concerned about the contributions of both the noble Earl, Lord Howe, and the noble Lord, Lord Clement-Jones. I suspect that, so far as concerns this matter, they have not quite come to terms with some of the changes that are already taking place within local government.

The noble Earl, Lord Howe, suggested, for example, that councillors would not be able to take on such an onerous responsibility. I believe that he may not have recognised the enormous change that is occurring within local government. A distinction is now being drawn between the, perhaps, 10 members of a local authority who will sit on a cabinet and run the local authority by carrying out the executive, decision-making functions, and the role of the remaining—perhaps 50—members of a local authority, who will be involved in scrutiny arrangements. Not only will they be concerned with what their own local authority's executive—the cabinet—is doing; they will also have responsibility for reviewing and taking a policy view of what is happening elsewhere in their area. They will act as genuine local representatives. That change in the role of most local councillors will represent a valuable part of the work that they do. It will not be squeezed out by executive responsibilities because the nature of local government work has changed.

Similarly, the noble Lord, Lord Clement-Jones, conjured up a fantasy that overview and scrutiny committees would be dominated by the party whip system. I appreciate that he is probably not as steeped in the rules of the Labour Party as I am. The Labour Party has adopted rules which state clearly that it is not possible to whip councillors who sit on scrutiny committees. He may be telling us that the Liberal Democrats or, for that matter, the Conservative Party allow rampant whipping to take place on scrutiny committees and that, therefore, they distort the whole operation. However, if all the major parties took the view, as the Labour Party has done, that it is not appropriate for whipping to take place, that issue would not be so serious.

Having said that, I believe that, by and large, the Government should consider seriously the amendments that have been put forward. There are risks in relation to scrutiny of the health service by local government. One such risk is that the process could be extremely antagonistic, with local authority councillors spending their time effectively attacking what takes place in the local health service and pursuing matters in relation to closures, cleanliness, waiting times, or whatever, to the exclusion of the wider picture.

That is why I believe that the amendment in the name of the noble Lord, Lord Clement-Jones, which seeks to ensure that part of the scrutiny process involves the consideration of health improvement programmes, and so on, and the strategy required in that respect, is sensible. It seeks to ensure that discussions held by scrutiny bodies are focused on the wider picture and do not become antagonistic.

I believe that an approach which ensures that scrutiny committees listen to the viewpoints expressed by other agencies and call evidence—perhaps in the same way as parliamentary Select Committees are able to do—will make certain that the relationship between local authority scrutiny committees and the local health service is constructive rather than antagonistic. We should certainly all be working towards that. Therefore, I hope that my noble friend will consider the amendments carefully and ensure that the spirit behind them is embodied in the final legislation.

The Earl of Listowel

I also welcome the amendments in the name of the noble Lord, Lord Clement-Jones, and I welcome the extra patient focus that the Government are introducing. Recently, at a Centrepoint conference, two young, homeless 20 year-olds made a presentation. What they said was far more powerful and constructive than anything said by any other contributor, including chief executives and the local mayor.

In his opening remarks, the noble Earl, Lord Howe, made clear that a balance needs to be struck between individual representation and the whole picture or the whole community. Therefore, I am concerned about what will happen to the former function of CHCs, which, to a large extent, involved reaching out to the local community and looking out for local health needs.

Therefore, I welcome the amendment and would appreciate some reassurance in the Minister's response as to how proactive the replacement for CHCs will be in reaching socially excluded groups. As an example of what CHCs have achieved in the past, perhaps I may quote from a newsletter: Health Action for Homeless People has had a long association with Community Health Councils. They were instrumental in establishing the organisation and managing it for many years. London CHCs in particular have an understanding of the difficulties experienced by homeless people in accessing good health care and are effective in lobbying for improved access and for good quality specialist services". Perhaps I may give another example. At a recent meeting of the All-Party Parliamentary Group on Maternity, its members heard about research currently taking place in Islington. That research indicates that a surprisingly large number of single mothers are living in temporary accommodation and that they have very few friends. They have no contact with one another. There may well be a need for a health initiative in relation to that situation. Perhaps a local centre is required to bring the mothers together, or something along those lines. Again, I hope that the Minister will address those concerns in his response.

6.15 p.m.

Lord Hunt of Kings Heath

This large group of amendments probes the functions of local authority overview and scrutiny committees. Perhaps I may refer to the original question raised by the noble Earl, Lord Howe. He asked what we are trying to achieve. First, as my noble friend Lord Harris said, such committees are a recognition of the leadership, or advocacy, role which local authorities play in the community. In addition, their establishment recognises that the National Health Service is an important part of any local community. It is absolutely right that local authorities should wish to take a view on the progress and key decisions of the National Health Service. I believe that the committees will lead to an enhanced relationship between the NHS and local government.

Over the past 10 or 20 years we have seen the problems that arise when the NHS and local government do not work well together. In recent years, there has been a tremendous improvement in that relationship. In the winter planning undertaken over the past few months, local authorities have been absolutely vital partners in the planning and provision of services. The enthusiasm with which they took part in discussions with the NHS at local level showed a much more positive relationship than there has been for many years.

I understand the concern expressed by the noble Earl, Lord Howe, that that relationship may become adversarial and destroy the good work that has taken place. However, I believe that the scrutiny committees will lead to local authorities having a greater understanding of the issues and priorities faced in the health service. I believe that, just as importantly, they will help the NHS to understand local authorities' core issues of concern which affect the whole community.

From discussions that I have held with members of many local authorities, I understand that they welcome the proposed new role. They believe that they will have the capacity to undertake it, and they will use it as a constructive approach towards better relationships with the NHS overall.

In response to a number of amendments, perhaps I may reiterate that I believe that, in time, the committees will develop an expertise which will add value to the process of NHS scrutiny. We are providing a new function for an existing body. Therefore, the overview and scrutiny committees will continue to be bound by the procedural requirements set out in local government legislation, which is a part of the local authority's responsibility. That is why making the power in Amendments Nos. 51 and 52 is unnecessary. They will also draw on their existing resource arrangements for the funding of those OSCs.

We expect the OSCs to have a wide-ranging role and to take their own decisions as to the key areas for scrutiny in their local areas. We also intend the OSCs to have real teeth. Therefore, I should say to the noble Earl, Lord Howe, that the function of referring contested service change proposals to the Secretary of State by an independent reconfiguration panel, currently with CHCs, which will pass to OSCs, will be a very important indicator of the importance of the scrutiny committees.

Clearly there will be other matters which do not come within the definition of a contested service change. But it would seem to me unlikely that the local NHS would not take account of the views expressed by the OSC on a whole range of matters.

I certainly accept that the OSCs cannot operate in a vacuum. They will have shared interests with patients' forums and patients' councils. We expect those bodies to work together locally. But it is important that we recognise that they have different functions. The OSCs are there to represent the interests of the public. Patients' forums and councils are set up to have a specific patient focus. Both perspectives are important but they are different and there is a risk of mixing the two so that one becomes drawn into—I use the noble Earl's expression—a mish-mash. It is extremely important that we clarify and separate those different roles. That is why we do not agree with the suggestion that OSCs, patients' forums and councils should be obliged to share members or that there should be formal partnership arrangements.

I have mentioned already that we want OSCs to develop their own priorities for scrutiny. I certainly agree with the noble Lord. Lord Clement-Jones, that the local HImP and actions to address health inequalities are likely to be high on the agenda. Amendments Nos. 37 and 53 would provide specific powers to allow the Secretary of State to require OSCs to look at those issues.

I do not believe that those amendments are necessary. Those issues relate to the health service. The current regulation-making powers in the Bill would enable the Secretary of State to provide that such issues are considered. I for one should very much welcome OSCs focusing on those issues because if we are talking about health inequalities, we shall certainly not achieve all we wish to achieve unless health and local government are working together.

I turn now to the issue raised by the noble Lord, Lord Peyton, who is no longer in his place, to which the noble Earl referred; namely, the risk of tying, up the NHS in bureaucracy in responding to the information requirements or the summoning of NHS officials before the OSCs.

I understand Amendment No. 43. We anticipate requiring NHS chief executives to appear before the OSC once or twice a year. That is a reasonable requirement. We do not believe that we need further protection on the face of the Bill. I should much prefer to leave this matter to the good sense of people locally to operate sensibly. I really believe that the great majority of local authorities will behave sensibly and will call NHS officials before them when that seems appropriate but will not over-egg that and cause a huge bureaucratic burden for them.

It is worth saying that OSCs are developing ground in local government. Experience so far shows them to be effective. And so councils will not be coming to this with a fresh piece of paper. They will have had experience in operating the system.

Our proposal to make local social services authorities the lead on NHS scrutiny will certainly help to ensure effective and consistent scrutiny and will reduce the number of OSCs directly scrutinising the NHS.

I do not agree with Amendment No. 38, which would give all district councils scrutiny rights. There is a part for district councils to play in NHS scrutiny and the provisions in Clause 8 allow that to happen. But if each of the large shire counties with a large number of non-metropolitan district councils had scrutiny powers as of right, there would then indeed be the bureaucratic problem to which the noble Earl referred.

We believe that the OSCs should look at all services, including those delivered in partnership with the local authority. I know that some Members of the Committee have expressed concern about that but it is worth making the point that within the OSC role within local government, that happens now in relation to scrutiny by the committee of local authority directly provided services. On those grounds, I would not support Amendment No. 56.

Amendments Nos. 46, 49 and 52 deal with the powers of OSCs to call for inquiries or involve CHI, the Audit Commission or the Secretary of State. As regards inquiries, I do not believe that it is necessary for the OSCs to be able to call inquiries, particularly not with powers to summon evidence. That would be a power on a par with that of the Secretary of State under Section 84 of the National Health Act 1977. The Bristol inquiry is an example of the use of that power. It seems to me that that is going too far. But, of course, OSCs have every right to decide what issues to look into and the right to ask people to come to give evidence.

On the submission of OSC reports and concerns to other bodies, if it is unhappy with the way that the local NHS has responded to it, the OSC will be able to refer its concerns to the Secretary of State or the regional office. I confirm also that the Commission for Health Improvement is already empowered to investigate concerns raised by other bodies so that no new powers are needed to allow CHI to respond to requests from an OSC. Therefore, those amendments are unnecessary.

Amendment No. 41 seeks to change "may" to "shall". That would mean that the regulations on OSCs would have to make provision for all the matters set out in paragraphs (a) to (f). It may not always be appropriate, over time, to make provisions on some of those matters. In addition, the extent to which the Secretary of State would have to make such provision is unclear. So I firmly come down on the side of "may" in this debate.

However, I assure the Committee that it is our firm intention to make regulations to define fully the role of OSCs, as it is clear that regulations must be made if the scheme is to operate properly.

As regards taking account of the views of those who have an interest, we shall consider and welcome any views given to us by relevant organisations, such as the Local Government Association, before making the appropriate regulations.

Lord Smith of Leigh

Perhaps I may seek clarification on some of my noble friend's comments. While I agree with him that overview and scrutiny committees should help to strengthen the relationship between the NHS and local authorities, they should not be seen as replacing relationships which exist already between the executives of local authorities and the NHS. Those bodies deal with those matters on which my noble friend commented; for example, the problems in relation to winter planning. They will also help to develop the care trusts and so on. As my noble friend knows, in my own authority there is a well-established health partnership board which involves ourselves, the local NHS trust and the health authority. Indeed, I had to tender my apologies in relation to that today in order to attend your Lordships' Committee.

6.30 p.m.

Lord Hunt of Kings Heath

Perhaps I can respond to my noble friend. I agree with the point. I was simply trying to say that I believed that overview and scrutiny committees would be but one aspect of the developing local government/NHS relationship. I certainly accept that, in terms of ensuring that collaboration and the provision of services works, including the involvement of the local authority in major NHS strategic change, the role of the executive of the local authority would be important.

Baroness Cumberlege

Much of this has merit. I understand the democratic deficit argument that has taken place for decades. Where the overview and scrutiny committees are good they will be very good; but where they are bad they will be perfectly horrid. Where there is a danger that the OSCs become a griper's charter, where they do nothing positive at all, but in fact destroy the trust and the good relationships that have built up, what action can be taken? Secondly, how will the committees be judged in relation to their performance? What criteria will be set against which they can be judged?

Lord Hunt of Kings Heath

That must be a matter for the local authority concerned because that will be part of the scrutiny role of the local authority. The scrutiny committee will not operate on its own, but it will operate alongside a number of other scrutiny committees. I would expect the local authority—as it will when it reviews the performance of the scrutiny committees from time to time—to monitor, to review and to take account of any views that the NHS may express when considering whether any changes need to be made.

On the issue of areas where the relationship is difficult, I do not want to dwell on that too much because I am positive about the developing NHS/local government relationship. I believe that it has changed fundamentally in the past few years. Now it is rare to find a place where the relationship is as bad as those to which the noble Baroness has referred. I also believe that it takes two to tango. It is not just a matter of a local authority being excessive in its demands; it is also a matter of the NHS being prepared to share information, time and officials with the scrutiny committee to take that committee through the issues that they are debating. At the end of the day, I believe that ensuring that that works out as effectively as possible should be left to the local level.

Earl Howe

Before the noble Lord, Lord Clement-Jones, responds perhaps I could ask the Minister about the purview of an overview and scrutiny committee. The lines on a map that delineate the boundaries of health authorities do not always reflect real life. Will a local authority overview and scrutiny committee have powers to examine proposed health service changes in adjacent local authority areas if such proposals are thought likely to have an impact locally?

Lord Hunt of Kings Heath

I would expect the focus of the OSC to be related to services provided within its boundaries. I accept that the NHS does not necessarily organise itself around local authority boundaries; sometimes perversely hospitals are built just within a borough boundary, and London has classic examples of that. That is why in Clause 8 we allow for regulations to make provisions for two or more local authorities to appoint a joint committee. Through those arrangements we shall be able to deal with issues such as a hospital that is on one side of a boundary providing services to those on the other side of the boundary. We would hope to deal with the general principles through regulations, but much will come down to good common sense as well.

Lord Clement-Jones

I thank the Minister for his response to this set of amendments. The noble Lord, Lord Harris of Haringey, lowered the tone of the debate by referring to "rampant whipping" and I confess that despite having lived in Lambeth for 30 years I had not realised what pussycats the Labour Chief Whips have become under the new regime!

The noble Lord, Lord Harris, made an important point that we need to design into this set of proposals the opportunity for constructive discussion between the NHS and local government. I believe that that is the cardinal aim set out by the Minister. He referred to enhancing the relationship between the NHS and local government, that the scrutiny committees would have real teeth and that they will not operate in a vacuum.

Since 1974 there has probably been a democratic deficit in the health service that requires amendment. As I said earlier, we have suspended disbelief in relation to this matter, but if these proposals go some way towards curing that democratic deficit, they should be welcomed. The Minister was extremely tentative in his approach to some of the amendments, which is to be regretted. In some areas he was a little vague; for instance, on the ability to scrutinise health improvement plans and health improvement strategies—they were welcomed by the noble Lord, Lord Harris—which I believe would be a cardinal function, he said that the Secretary of State would have power to require overview and scrutiny committees to do so and that he, as a Minister, would welcome a focus on those issues by OSCs. To me that did not quite add up to the Minister saying, "Yes, we will definitely place a duty on and give a power to OSCs to do so". A little more clarification from the Minister would be helpful.

Lord Hunt of Kings Heath

I do not believe that there is any doubt at all that the OSCs will have the ability to question the local health service about HImPs and their future strategies. That is the whole purpose of the committees.

Lord Clement-Jones

I assume from that that the Minister is saying that the Secretary of State will make regulations that allow them to do so and to have that as a principal part of their duties. In the Bill as currently drafted, that does not spring from the page.

Another aspect is that as we go through the Bill clause by clause at one point the Minister is a great centraliser and at another point he becomes the great decentraliser, except in relation to district councils: "We are the great decentraliser; this is the way we do things; we devolve to the lowest point and when it comes to representation it goes to patients' forums which are at the right level, close to the patient, close to the public and close to the NHS trusts and so on. But when it comes to scrutiny, I am very sorry that the ordinary district or borough council is not to be allowed anywhere near this set of proposals". On that point the Minister's response was not particularly adequate.

Lord Hunt of Kings Heath

I am grateful to the noble Lord for giving way. My first experience as a member of a local authority was in Oxford, in a non-metropolitan district council. I understand why non-metropolitan district councils would want to be scrutiny committees in their own right, but perhaps I can take Kent as an example. Kent has a population of 1.3 million; it comprises 12 district councils and one unitary authority. With the best will in the world, unless the principal local authority—the social services authority—is the OSC, one would run into the kind of bureaucratic issues that have been raised by noble Lords in Committee.

Of course, there will be an ability for the county council scrutiny committee to co-opt a member of a district council; it will also be able to delegate its roles perhaps in relation to a particularly local service. However, in practical terms, I believe that it will be difficult to allow the amendment.

Lord Clement-Jones

I thank the Minister for that extra elucidation, which was genuinely helpful. Although we found his response more unhelpful than we originally anticipated, having heard it I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

The Deputy Chairman of Committees (Lord Geddes)

I must advise the Committee that if Amendment No. 38 is agreed to I cannot call Amendment No, 39.

[Amendment No. 38 not moved.]

Lord Clement-Jones moved Amendment No. 39: Page 6, line 25, at end insert— ( ) the GLA

The noble Lord said: Fuller amendments on a similar theme remain to be discussed in this group. In the light of the experience of Members of the Committee who have tabled them, I know that they will be most interesting and I shall therefore be brief in introducing Amendment No. 39. It is tabled in order to draw the attention of the Committee to a major gap in the provisions.

We debated the GLA Bill at some length. Although it was not as full as it might have been as regards the duties of the authority to have responsibility for certain public health matters, as a result of work carried out by the King's Fund and other bodies, it was possible for the other place to insert provisions relating to the GLA's assessment of its health policies on the capital. It seems to us on these Benches and to many organisations involved in health in London that the position of the GLA must be recognised to a greater extent.

Indeed, one could draw a parallel much more broadly. The future role of regional government should be recognised. After all, the GLA is a strategic body and such health scrutiny is precisely the kind of activity it should be carrying out. Unless it is brought into the net—and I speak as a Londoner—London will be the poorer and we shall not have the precedent that we should have for future regional government. I beg to move.

Lord Smith of Leigh

In speaking to Amendment No. 58, I want to add to what was said by the noble Lord, Lord Clement-Jones, about the missing elements in the Bill. I welcome in principle the fact that Clauses 7 and 8 increase local authorities' accountability for the health of local people. However, at regional level in England, particularly in London, that element is missing in various proposals.

As the noble Earl, Lord Howe, said, issues relating to health do not fit neatly into the boundaries of local authorities, either singly or collectively, effectively to organise scrutiny. For example, public health for the region; the work of the regional health authorities; tertiary care provision; and health performance indicators, both inter-regional and intra-regional, could be subject to scrutiny by bodies at the level of the region.

Throughout England, there are in existence organisations which are capable of handling such matters. They are the regional assemblies and chambers which exist in all regions throughout England. They are selections of local authorities and other key social partners.

Unfortunately, the Department of Health does not always recognise the way in which the regional agenda is moving in England. On Friday, I attended a seminar held at the DETR examining the way in which the regional agenda is developing. All the key departments of state were represented, with the exception of the Department of Health. Even the Treasury was represented.

Health has a major role to play at the regional level in driving policy forward. I commend to my noble friend the social inclusion policies, which are most important for the Government, and also regional economic development. We need to get the health of people right. In my area, levels of unemployment may not be as high as they once were, but the level of incapacity is exceedingly high.

The work of the regional assemblies and chambers is being recognised by other parts of the Government. The Deputy Prime Minister and the Chancellor attended a meeting in Middlesborough on Friday 9th March. The Chancellor then said that he was making £5 million of new resources available to regional chambers to help them establish a substantially expanded scrutiny role within regions. He deliberately did not say that that was to be scrutiny only by the RDAs but left it open for them to examine across the region issues which matter to that region.

Regional assemblies are on the agenda. They have the means and the ability to effect scrutiny at the regional level and I hope that my noble friend will consider that most carefully.

6.45 p.m.

Lord Harris of Haringey

I want to speak to Amendment No. 65 standing in my name. I declare an interest as a member of the Greater London Assembly. The amendment is designed to rectify what I can only assume to be a mental aberration by civil servants in failing to recognise the existence of London. Recognition is given to the City of London, which has its own special clause, but the other 7 million people in London might wonder why no arrangements within the Bill would permit the London Assembly to take part in the overview and scrutiny arrangements in respect of London's health services.

We may be told by my noble friend the Minister that that is not a problem because the London Assembly's terms of reference are so broad. However, I am concerned that it is not made clear in the Bill that the London Assembly has a role in respect of the scrutiny of London's health services. Part of that role must be fulfilled in collaboration with the London boroughs and I can see circumstances in which provisions for joint committees of local authorities to scrutinise pan-London health issues will not involve the London Assembly because it is not included on the face of the Bill.

In referring to a particular anomaly, I should declare an interest as a non-executive member of the trust board for the London Ambulance Service. Such trusts are responsible for delivering pan-London services. I understand that twice a year the chief executive of the London Ambulance Service might be required to attend meetings of the overview and scrutiny committees of all 32 London boroughs and of the Corporation of the City of London, perhaps making some 66 visits to such committees. Given that he has an extremely busy role, that is not necessarily the best use of his time.

The most sensible outcome would be for the Bill to reflect clearly the role of the London Assembly; to reflect the fact that the most appropriate scrutiny body for the London Ambulance Service and any other pan-London service will be the London Assembly; and to ensure that the provisions of the Bill cover that. I am sure that the amendment tabled by the noble Lord, Lord Clement-Jones, has the benefit of simplicity but I suspect that it is technically flawed. I suspect that my attempt, which is rather more verbose, is also technically flawed. However, I hope that my noble friend will assure the Committee that at a later stage he will bring forward proposals which will cover London and the role of the London Assembly.

Lord Hunt of Kings Heath

I am grateful to both my noble friends and the noble Lord, Lord Clement-Jones, for raising an interesting question. I recognise the role of the GLA and the regional assemblies and chambers and I am encouraged by their interest in healthcare issues in the wider sense. I am responsible for the eastern and north-western regions of the health service and I encourage both chairs to become involved in the regional chambers. It is very important that regional. chambers understand, for example, the effect of the NHS on the regional economy which can be quite profound. I begin by being positive about constructive relationships at that level.

There are two issues in the context of the Bill. Clearly, we are endeavouring to promote scrutiny at local level, because in the end it is the connection between the health service and local services which has more impact on the quality of the services to the patient and the public. That is why in terms of scrutiny of the NHS we have made local social services the lead authority. I believe that the case for that is as strong in relation to whatever be the regional structure as in relation to the issue raised earlier by the noble Lord, Lord Clement-Jones, who referred to district councils. We need clarity.

I am convinced that the principal local authority which accepts the role of scrutiny should be the local social services authority, but I accept that there are circumstances in which scrutiny on a regional basis is appropriate. The powers in Clause 8 of the Bill enable that to happen through a joint committee of the OSC with NHS scrutiny right across the region. I believe that that approach provides a practical basis for working with the GLA without taking any further powers. I am wary of further powers which in the end make unclear who is responsible for scrutiny of the NHS. I believe that to provide powers to the GLA or regional assemblies on the face of the Bill could lead to confusion o f scrutiny responsibilities unless there is clarity as to which authority is absolutely responsible. The Bill already provides for joint committees and will enable a pan-London committee to be established with co-opted GLA members.

I accept the point made by my noble friend Lord Harris that we want to avoid the need for the chief executive of the London Ambulance Service Trust to make 66 visits. We want a sensible arrangement and we believe that the Bill allows for that. I point out to my noble friend that officials of the department are working with the GLA to develop a protocol about the involvement of the GLA in the development of London-wide health strategies. I should be very happy to meet my noble friend to discuss that further.

It is very difficult to accept Amendments Nos. 141 to 143 because it is our policy that CHCs should be abolished. On that basis, those amendments fall.

Lord Harris of Haringey

Can my noble friend clarify how Clause 8 applies to the London Assembly?

Lord Hunt of Kings Heath

In a number of ways. Clause 8(2)(a) provides that, two or more local authorities may appoint a joint committee of those authorities". Therefore, it would be possible for the London boroughs to come together to organise a joint committee and for co-options to take place.

Lord Harris of Haringey

First, does my noble friend suggest that Clause 8(2) operates on the basis that the Greater London Authority is a local authority, which on occasions is subject to some doubt? Secondly, can the Committee be clear that Clause 8(2) does not require the operation of subsection (1) as far as concerns the GLA? Clearly, that authority cannot fall within the purview of Clause 8(1) because it does not have executive arrangements under Part II of the Local Government Act.

Lord Hunt of Kings Heath

I said to my noble friend that I was very happy to meet him to discuss this further, particularly in the light of the protocol arrangement that we wish the Department of Health to develop with the GLA. Clause 8(2) makes provision for two or more local authorities—which I take to mean London boroughs—to appoint a joint committee, but it would be open to that joint committee to co-opt members from the GLA.

Lord Smith of Leigh

Is the Minister saying that Clause 8(2)(a) applies also to the regions outside London?

Lord Hunt of Kings Heath

I require a little more persuading of that. The specific case raised by my noble friend Lord Harris related to the area of the London Ambulance Service which, if not coterminous with the GLA boundary, is fairly close to it. If one looked at other regional assemblies one might find it difficult to identify a service which neatly fitted into the regional boundary. I want the NHS and regional chambers and assemblies to have a close working relationship and I am very happy to discuss that further with my noble friend.

Lord Harris of Haringey

I apologise for labouring the point. Can my noble friend say where in Clause 8 there is a power for a joint committee to co-opt?

Lord Hunt of Kings Heath

I am trying to find it myself. There is no question but that the committee can co-opt. Perhaps I may write to my noble friend on that matter. The key point of Clause 8(2) is the ability of local authorities themselves to appoint a joint committee.

Lord Clement-Jones

I thank the Minister for his response. As I anticipated, the noble Lords, Lord Smith and Lord Harris, made rather better arguments than I managed to muster because of their knowledge of the regions and the GLA respectively. They made rather telling points, particularly the quotation of Ministers in support of their arguments. The Minister responded more positively than at many other times today by describing this as an interesting debate. We must be making progress if this is interesting, no doubt in contrast to some of the previous debates.

I recognise the Minister's genuine belief in a constructive relationship at regional level, but when he went on to describe what that consisted of they were really crumbs from the legislative table. It is a very unsatisfactory situation if we are to stitch together the joint committees under Clause 8, when clearly the GLA for that purpose does not appear to be a local authority, with the possibility of co-option under a provision of the clause which is extremely well hidden, to say the least. We must then fall back on the formation of a protocol between the GLA and Department of Health, which in a sense gives the DoH the whip hand in all those circumstances. It would be far more satisfactory to recognise the strategic role of regional government, starting with the GLA. I give way to the Minister who appears to be about to tell the Committee the reference to co-option.

Lord Hunt of Kings Heath

It is not surprising that I cannot find it in the Bill because it is not there. The power is in Section 21(10) of the Local Government Act 2000 whereby a local authority may co-opt any persons who are not members of the authority. That would relate to the establishment of the joint overview committee which could cover London.

Lord Clement-Jones

I thank the Minister for his reply, which emphasises that we must pray in aid other bits of existing legislation and stitch them together to come up with a solution that is in any way satisfactory. Clearly, the Bill would benefit enormously from an addition which recognised the role of the GLA and future regional assembles. We may well wish to return to this amendment in various forms at a later date. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

7 p.m

Earl Howe moved Amendment No. 40: Page 6, line 25, at end insert— ( ) Where a county authority comprises district councils, it shall, where appropriate, include in the membership of the scrutiny committee representatives of each or all of the district councils within the authority's area of responsibility for health services.

The noble Earl said: I was contemplating not moving this amendment. However, I hope that the Minister will allow me to return to the subject raised by the noble Lord, Lord Clement-Jones, in Amendment No. 38, because I think that there perhaps is a broader dimension to the question than he suggested.

Clause 7 seeks to enhance patient and public influence in the development and operation of the NHS by introducing democratic scrutiny of the NHS through local authority overview and scrutiny committees. As the Committee will know, the clause provides for scrutiny by county councils, county borough councils, unitary authorities and London borough councils. Amendment No. 40 seeks to extend the scrutiny rights to district councils.

To back up the thought behind the amendment, it may be helpful to remind the Committee of a few key points. The NHS primary care reorganisation into primary care groups, evolving into primary care trusts, was devised so that decision making on primary care services could be devolved to communities of approximately 100,000 people. Many of the boundaries of primary care groups, and hence PCTs, are exactly those of their district councils. For rural communities, the county council may seem fairly remote and be located quite some distance away. This amendment seeks to honour the local accountability objective of primary care reorganisation; and it may prove particularly valuable if there is an important local issue such as the closure of a community hospital.

There is a further issue. A primary care group acts as a sub-committee of a health authority. Primary care groups are encouraged to become primary care trusts independent of, but accountable to, their health authorities. The next stage of the evolution, as we shall debate in later amendments, is to become care trusts under the provisions of this Bill. The care trust will probably provide its services within the same boundary of the PCT, if it has evolved from a PCT.

The budget of a care trust for social care is to be delegated from the authority providing social services. It may be worthy of consideration by the Government that that combined role should be democratically accountable to the community that it serves. The Minister said that he thought that this proposal would lead to some unwelcome bureaucracy. I am all for getting rid of unwelcome bureaucracy. However, I should like to suggest that there are all sorts of good reasons relating to democratic representation and the contribution of local knowledge that serve to recommend it. I beg to move.

Lord Hunt of Kings Heath

I understand the noble Earl's point. I have already made it clear that I have sympathy with non-metropolitan district councils and that I would certainly encourage the NHS locally to develop as strong a partnership as possible with those councils. Their housing and other roles make that doubly important.

My concern is that unless it is absolutely clear which local authority in any given area is the overview and scrutiny committee, there will be many problems and potential disputes. That is why I consider that the way in which it is expressed in Clause 8 provides a satisfactory way through. Clause 8(2)(b) makes it clear that, a local authority may arrange for relevant functions in relation to that authority to be exercisable by an overview and scrutiny committee of another local authority". I can assure the noble Earl that in relation to Clause 8 that could be a non-metropolitan district council.

To take the noble Earl's example, if a matter arose concerning a primary care trust, it would be perfectly appropriate and possible for the county council to arrange for that oversight function to be exercisable by the overview and scrutiny committee of a non-metropolitan district council which covered the area of the PCT; but the decision whether or not to do it would be a matter For the county council. I believe that we have the capacity to make it abundantly clear that within any locality one local authority has that overall responsibility.

Earl Howe

I am grateful to the Minister. I shall reflect on what he has said. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 41 not moved.]

Lord Clement-Jones moved Amendment No. 42: Page 6, line 27, at end insert— ( ) as to the composition of the committee so as to include representatives of the voluntary sector and the Patients' Council,

The noble Lord said: This amendment relates to scrutiny committees, which we have discussed at some length. But we have not discussed the composition of the scrutiny committees as set out in the Bill. This is another provision designed to join up some of the current proposals. It seems to us that it would be very important to have on the scrutiny committees, as of right, representatives of the voluntary sector and patients' councils—not simply co-optable under the provisions outlined by the Minister but as an integral part of the scrutiny process. I beg to move.

Lord Astor of Hever

I rise to speak to Amendments Nos. 59 and 61, which are designed to ensure that there is fair political representation on local authority overview and scrutiny committees. That would mean that they reflect as closely as possible the aggregate representation of the different political groups of the local authorities and ensure that the Secretary of State cannot, by regulations, change this balance.

We have two concerns. First, while the powers and changes to local government in England and Wales, as created by Part II of the Local Government Act 2000, are in their infancy, this clause of the Bill proposes to extend the role of scrutiny councillors into non-local authority functions. No doubt many scrutiny committees will contain a number of able councillors. However, against the background of continuing doubts about the executive/scrutiny split and the likely experience of scrutiny members, we are concerned that the necessary time, scrutiny and weight given to these functions may be lacking.

Our second concern is to ensure that each scrutiny committee's membership reflects the political make-up of the area for which it is responsible. That is of particular importance, as health authorities' boundaries do not always correspond with those of local authorities. In addition, each local authority is likely to have a different political composition.

Section 21(11) of the Local Government Act 2000 brings into force Section 15 of the Local Government and Housing Act 1989—the duty to allocate seats to political groups. However, under powers in Sections 20(e) and 24 of the 2000 Act, the Secretary of State has the power to modify any arrangements made by local authorities.

We would therefore be grateful if the Minister could confirm what arrangements will be put in place to ensure a fair and equitable settlement of political representation between authorities.

Lord Hunt of Kings Heath

I deal first with Amendment No. 42, which would require membership of OSCs to include representatives of the voluntary sector and the patients' council. I firmly believe that that should be a matter for the local authority to decide. I am also very clear that the OSC must be in the hands of elected councillors, because that is the whole purpose of having an OSC. It is very important that that should not be dissipated by having too many other people on those committees. It must speak with the authority of the local authority.

As I have made clear in my reference to Section 21(10) of the Local Government Act 2000, it is already possible for OSCs to co-opt, as non-voting members, members of the voluntary sector, or, indeed, members of the patients' council. However, it is preferable for that matter to be left to each individual local authority to decide.

Perhaps I may turn to the issue of reflecting the balance of OSCs to ensure that there is a proper distribution of seats to political groups among appointing local authority members. Under Clause 8(3)(b) of the Bill, the Secretary of State is already allowed, in making regulations, to apply with modifications Section 15 of the Local Government and Housing Act. That is relevant to ensuring that we get an appropriate balance. I accept the points that the noble Lord makes. It is important that one gets a political balance. That enhances the credibility of the work of the overview committee. That may be more difficult when joint committees are established. But, as far as possible, our aim is that, when making regulations, the Secretary of State will try to ensure that OSCs are as representative as possible.

Lord Clement-Jones

I thank the Minister for his response, particularly to Amendment No. 42. Clearly, that was a disappointing response. It would be understandable if the whole mechanism was so clearly thought through that there was no further room for representation, and so on, but, as this scheme is still very inchoate, it seems disappointing that valuable additions to it, in terms of binding together the scrutiny and representation functions, have not met with any positive response from the Minister. Nevertheless, we shall ponder on what he has said. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendment No. 43 not moved.]

Earl Howe moved Amendment No. 44: Page 6, line 40, at end insert— ( ) requiring any member of an oversight and scrutiny committee who is also a member of the Health Authority, NHS Trust or Primary Care Trust not to take part in the discharge by the committee of the functions described in subsection (1) above

The noble Earl said: In moving Amendment No. 44 I shall speak also to Amendment No. 56. This is a straightforward but important issue which I have taken separately. My concern is twofold. There is a danger that OSCs may find themselves acting somewhat incestuously. It is one matter for them to be scrutinising NHS bodies and providers; it is another for them to be scrutinising local authority services provided under joint care arrangements. There is an obvious conflict of interest in the offing there.

It would be better to entrust the overview and scrutiny of joint care arrangements to patients' forums, with the help of patients' councils. Those bodies will be quite independent of the arrangements under scrutiny and well-placed to exercise their functions in a manner that will command public confidence.

The other conflict of interest that might arise relates to scrutiny councillors themselves. It would be a total nonsense if particular members of local authority scrutiny committees were required to scrutinise the responsibilities that they had discharged as board members of trusts or health authorities. I beg to move.

7.15 p.m.

Lord Hunt of Kings Heath

I have some sympathy with Amendment No. 44 in the name of the noble Earl. The Department of Health is already working with the Department of the Environment, Transport and the Regions on the development of a code of conduct for the membership of the OSCs. The appropriate place for any guidance on matters concerning the possible interests of OSC members involved in scrutiny in the NHS would be in that code of practice. I certainly take on board the substantive point that the noble Earl makes.

So far as concerns the other issue, I do not agree with the noble Earl. I believe that OSCs should look at all services, including those delivered in partnership with the local authority. The noble Earl and other noble Lords perhaps have concerns about the independence of the OSC in that respect, but, if one looks at the role of these scrutiny committees within local government as a whole, that is precisely what they do: they scrutinise services provided by their own local authority. The real distinction is that drawn by my noble friend Lord Smith, who reminded us that the OSC members have no executive role within the local authority. It is their core function to scrutinise local authority services. Therefore, I do not believe that this is a particular problem. On that basis, I urge the noble Earl to withdraw his amendment.

Earl Howe

I thank the Minister for his comments. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 45 to 53 not moved.]

Lord Clement-Jones moved Amendment No. 54: Page 6, line 44, at end insert— ( ) Before making such regulations the Secretary of State shall consult Community Health Councils, patients' and carers' organisations and the wider community.

The noble Lord said: I was heartened to hear what the Minister said earlier when we were discussing the scrutiny clause. Perhaps he can correct me if I misheard him, but I think that he said, "And of course patients' councils and others will be consulted on the regulations made". That was in relation to Clause 7 and the scrutiny provisions. I hope that is correct. I also hope that that would be the reality with regard to consultation over the regulations relating to patients' councils—for example, that they would be consulted on the regulations which applied to them. If that is the reality, which the Minister appeared to be expressing earlier, then why can we not reflect that on the face of the Bill? In addition, could we not include carers' organisations into the bargain? That would be best practice. In a sense, the Minister was saying, "Yes, we will follow best practice". If that is the case, I would very much hope that we could include that, both in relation to scrutiny and patients' councils and forums. I beg to move.

Lord Hunt of Kings Heath

Actually, I do not believe that that is what I said. I said we would consult on the regulations concerning OSCs with relevant organisations. I mentioned the local government association as a particularly relevant organisation. It is not necessary to specify on the face of the Bill with which organisations the Secretary of State should consult. What is clear, and has been the practice of the Department of Health over the years, is that when considering regulations we consult with the appropriate bodies. We shall very much take account of the views expressed to us. But I do not think that it is necessary to put that on the face of the Bill.

Lord Clement-Jones

I hear what the Minister says. I agree that one does not want a great long list. But it is always good at this stage of the proceedings to get some kind of assurance. If there were to be a national patients' council—for instance, if that transpired as a result of the Bill—would the Minister believe that that would be an appropriate organisation to consult over both sets of regulations?

Lord Hunt of Kings Heath

There are a good many "ifs" in that question. If a national patients' council were to be established and if it were established in time before the regulations for other parts of the Bill had to be prepared, I should have thought that it would be an excellent organisation to consult. However, perhaps the noble Lord's question relates more to the future than to the immediate present.

Lord Clement-Jones

If that is the case, I can only hope that the regulations take some time in the making. However, we shall hang onto the lifelines thrown by the Minister at this stage of the proceedings. In the meantime, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 55 to 57 not moved.]

Clause 7 agreed to.

Clause 8 [Joint overview and scrutiny committees etc]:

[Amendments Nos. 58 and 59 not moved.]

Lord Hunt of Kings Heath moved Amendment No. 60: Page 7, line 42, after "Act" insert ", or section 9 of, and Schedule 1 to, this Act

The noble Lord said: In moving Amendment No. 60, I wish to speak also to Amendments Nos. 62 and 63. Amendment No. 60 is a minor amendment that applies exempt information arrangements to joint overview and scrutiny committees as well as to OSCs established by Clause 7. Amendments Nos. 62 and 63 are technical amendments which ensure that arrangements in Wales for overview and scrutiny committees are consistent with arrangements in England. Essentially, they both have the effect that the National Assembly for Wales may make regulations enabling the Assembly to direct local authorities in Wales to enter joint scrutiny arrangements. That gives the Assembly the same powers as the Secretary of State in England. I beg to move.

On Question, amendment agreed to.

[Amendment No. 61 not moved.]

Lord Hunt of Kings Heath moved Amendments Nos. 62 and 63: Page 7, line 43, leave out "Secretary of State" and insert "relevant authority Page 7, line 47, leave out "Secretary of State" and insert "relevant authority

On Question, amendments agreed to.

Clause 8, as amended, agreed to.

Clause 9 [Overview and scrutiny committees: exempt information]:

Baroness Northover moved Amendment No. 64: Page 8, line 24, leave out subsection (4).

The noble Baroness said: The overview and scrutiny committees are of vital importance if there is to be transparency and accountability in the NHS. We have serious concerns about whether the committees will be able to achieve all that we would wish. Subsection (4) of Clause 9 rather illustrates our concern. Our amendment seeks to delete subsection (4) because it runs counter to the declared function of the committees. If retained, subsection (4) would allow the committees to restrict in whatever way they wished the information that they disclosed to the public, with no debate over that locally or nationally. If the committees are indeed to have a function of overseeing the NHS, it is clear that the public must know and be a party to decisions that are made about their services. What role can an overview and scrutiny committee fulfil if it operates in an unaccountable and secretive way?

The amendment therefore proposes the deletion of subsection (4), which seems to us to confer too much power without accountability. The operation of such a subsection would reduce transparency from the current standard. That would be unacceptable. Given the views and recommendations of the 12th report of the House of Lords Delegated Powers and Deregulation Committee on Clause 67 of the Bill, we ask the Government to reconsider subsection (4) of the clause, which we conclude gives an inappropriate power to the committees. I beg to move.

Earl Howe

The noble Baroness, Lady Northover, covered the ground very well in what she said. I should just like to add one or two points. Subsection (4) raises immediate questions because it contains a Henry VIII power. I should like to ask the Minister about that. As I read it, the subsection confers a great deal of power with precious little accountability. It effectively allows the Secretary of State and the Welsh Assembly carte blanche to restrict the information that may be disclosed to the public without, as the noble Baroness said, any prior debate or consultation. I question whether that is needed. The current standard of transparency in matters of this kind is one which, as far as I know, operates perfectly well. As a general rule, we should strive for a situation that provides the public with as much transparency as possible. It is right that the public should know about and be party to decisions made about their services. I hope that the Minister can clarify the background to this part of the clause.

Lord Hunt of Kings Heath

I certainly agree that we wish to have OSCs operating as openly as possible. Clause 9(4) enables the Secretary of State and the National Assembly for Wales to amend Schedule 1 by adding to it, varying it or deleting its provisions. But I hope that I can reassure the Committee as to the extent to which that is likely to take place.

Clearly, we are in a shifting environment. The NHS as an organisation needs to change from time to time. The provision in the clause to amend Schedule 1 by order allows the flexibility necessary to ensure that the public disclosure of information in the course of the scrutiny of the NHS is kept in line with the changing nature of the NHS and local government legislation. There is a specific situation that we already know may require this provision. For instance, during the passage of the Local Government Act 2000 Ministers undertook to conduct a review of the categories in Schedule 12A to the Local Government Act 1972 on which Schedule 1 to this Bill is based. Schedule 1 has some additional categories to reflect its health service focus. The review is being carried out by the Department of the Environment, Transport and the Regions. The intention of the review is to examine whether the list of exempt categories may be restricted. If the DETR changes the list, the department will also be able to take action to revise Schedule 1 accordingly.

It is worth explaining why we need exempt information. Where an OSC meeting is perhaps discussing NHS matters, it is possible that discussions will involve the disclosure of information relating to the NHS which should not be disclosed to the public at large. The obvious examples of that are personnel information or medical information about individual NHS patients. That is why Clause 9 and Schedule 1 make the additional provision for overview and scrutiny committees that are scrutinising the NHS which corresponds to the existing provisions of the Local Government Act 1972.

The reason for adopting a similar approach to that contained in the 1972 Act is so that, as circumstances change—for example, where changes are made to the NHS structure or legislation relating to the NHS is amended—Schedule 1 can be brought up to date or be otherwise adapted. I believe that the undertaking given by Ministers during the passage of the Local Government Act 2000 to see how this power could be further restricted provides the comfort required by the noble Baroness. Furthermore, we shall take account of any decisions that are made by the DETR at the end of its consultation.

Baroness Northover

I thank the Minister for that reply. I draw some comfort from it, but I am not fully convinced by what he has said. Nevertheless, for the moment I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 9 agreed to.

[Amendment No. 65 not moved.]

Schedule 1 agreed to.

Lord Burlison

I beg to move that the House do now resume. In moving this Motion, perhaps I may suggest that the Committee stage begins again not before half past eight o'clock.

Moved accordingly, and, on Question, Motion agreed to.

House resumed.