NHS Plan

HL Deb 18 April 2002 vol 633 cc1080-96

3.41 p.m.

Lord Hunt of Kings Heath

My Lords, with the leave of the House, I shall now repeat a Statement made in another place by my right honourable friend the Secretary of State. The Statement is as follows:

"Mr Speaker, with permission, I wish to make a Statement on the next steps on reform and investment in health and social services. I am today laying before Parliament a Command Paper setting out these next steps, copies of which have been placed in the Vote Office.

"The NHS Plan we published in July 2000 set out a 10-year programme to rebuild and renew the health service in our country. It diagnosed the NHS problem in this way: the principles of the NHS are right—on this side of the House we believe in in NHS free at the point of use, funded from general taxation, based on need not ability to pay. But the NHS today is the product of decades of under-investment. It is also the product of a failure to reform. Staff—the greatest asset that the health service has—work flat out in a system which still too much resembles the 1940s.

"The NHS Plan set out a 10-year programme of investment and reform: clear national standards, more devolution of resources, greater flexibility for staff and more choice for patients. With the economy stabilised and the public finances sorted out, the 2000 spending review was able to give the NHS the largest-ever real-terms increases in resources.

"Two years later, anyone who says there are no problems in the NHS have clearly got it wrong, but those who say there is no progress have also got it wrong. Yes, there is a long way to go; it is a 10-year plan. But those who point to an NHS black hole should in fact be pointing to dozens more hospitals, hundreds more beds, thousands more doctors, tens of thousands more nurses, and a better health service as a result.

"In July 2000, we acknowledged that three years' sustained funding was not enough. My right honourable friend the Prime Minister had already said in January 2000 that we needed to match EU levels of spending. Yesterday, my right honourable friend the Chancellor of the Exchequer put NHS finances on a sustainable footing, not for three years but for five. Years of failure in the past to invest are now being replaced with years of investment for the future.

"Today, I can tell the House what this investment will give us: 35,000 more nurses, 15,000 more doctors, 40 new hospitals, 500 primary care centres. As investment grows, so the capacity of the NHS will grow.

"Investment in the NHS must be accompanied by changes in the way the NHS works. Ours is not an unconditional offer. Without the reforms we will not get the best use of the money for the taxpayer and we will not get the improvements in service for the patient. Where we have had the courage to invest, we must now have the courage to reform. Our formula is simple: investment plus reform equals results.

"So, first, building on the national standards already in the NHS Plan, I can tell the House today that we will strengthen the system of inspection and audit to improve accountability to patients and the public. Where more resources are going in, people have the right to know what they are getting out. We will establish a new commission for healthcare audit and inspection to inspect and raise standards in healthcare across our country. But we are clear: we need higher standards in NHS hospitals, and there must be higher standards in private hospitals, too. The commission will assess the performance of every part of the NHS so that the public will see that every extra pound in the NHS buys something better for patients, gets something more for taxpayers.

"Similar arrangements will be made for social care. We will discuss the details of both with the National Assembly for Wales.

"The new commission will be independent both of the NHS and of Government and will be more independent than the current fragmented system. It will report annually to Parliament, not to Ministers, on the state of the NHS, the performance of the NHS, and the use to which NHS resources have been put. The Government should not be judge and jury on the NHS. The commission will be the judge, the British people the jury.

"Secondly, we can now go further in extending devolution in the NHS, building on what has been achieved to date. The health service should not and cannot be run from Whitehall. The NHS is delivered in hundreds of different communities by over I million staff. The relationships are between the local patient and the local doctor, and the local community and the local hospital. But these relationships will not work properly until central control is replaced by local accountability. After 50 years, the time has come when the sound of bedpans being dropped in Tredegar should only reverberate in Tredegar.

"With national standards and inspection in place, power, resources and responsibilities now must move to the NHS frontline. When we came to office, GPs controlled just 15 per cent of the total NHS budget. Today, primary care trusts—with GPs and nurses in the lead—already control half of the budget. Within just two years, they will control three-quarters. Just as the new commission will report nationally, so PCTs will need to report locally on how NHS resources have been spent.

"The best primary care trusts, just like the best NHS hospitals, should enjoy greater freedoms and more rewards. We will establish new foundation hospitals and foundation primary care trusts—fully part of the NHS, but with more freedoms than they have now. They will have more powers, including a right to borrow, to expand their services for patients.

"Thirdly, further to the new powers we have given to nurses and others, we will radically alter the way staff work and introduce a new system of financial incentives across the whole health service. We will put in place new contracts of employment—not just for nurses and other staff, but for GPs and, yes, for hospital consultants too. Our objective is to liberate the potential of all members of staff, reward those most who do most in the NHS, and, crucially, to improve productivity across the whole health service.

"New incentives for individual members of staff will be matched with a new system of financial incentives on NHS organisations. The hospitals that can treat more patients will earn more money. Traditional incentives work in the opposite direction. Indeed, it is often the poorest performers who get the most financial help.

"We will therefore introduce a new system for money to flow around the health service, ending perverse incentives, paying hospitals by results. The incentive will be to treat more NHS patients more quickly and to higher standards.

"Fourthly, patient choice will drive this system. Starting with those with the most serious clinical conditions, patients will have a greater choice over when they are treated and where they are treated. From this summer, patients who have been waiting six months for a heart operation will be able to choose a hospital—whether it is public or private—which has capacity to offer quicker treatment.

"This level of investment means that we can grow NHS capacity as fast as it is possible. I can also say today that it is our intention to draw into this country additional overseas capacity so that we can further expand NHS services to NHS patients.

"As capacity expands, so choice can grow. Within three years, all patients, with their GPs, will be able to hook hospital appointments at a time and a place that is convenient to themselves. The reforms we are making will mark an irreversible shift from the 1940s take-it-or-leave-it, top down service. Hospitals will no longer choose patients; patients will choose hospitals.

"Reductions in waiting times to get into hospital must be matched by cuts in waiting times to get out. Older people are the generation who built the NHS and who have supported it all their lives. This generation owes to that generation a guarantee of dignity and security in old age. Bed blocking denies both.

"In recent months the extra resources we have made have reduced the number of elderly patients whose discharge from hospital has been delayed. I am grateful for the help local councils have given us in addressing this problem. But here the long-term solution is not just investment; it is reform.

"So I can tell the House today that in order to bridge the gap between health and social care we intend, as they have done in Sweden and elsewhere, to legislate to give local councils responsibility from their 6 per cent extra real terms resources for the costs of beds needlessly blocked in hospitals. Councils will need to use these resources to ensure that older people are able to leave hospital when their treatment is completed.

"If councils reduce the current level of bed blocking so that older people are able to leave hospital safely when they are well, they will have freedom to use these resources to invest in extra services. If bed blocking goes up, councils will incur the costs of keeping older people in hospital unnecessarily. There will be similar incentives to prevent hospitals seeking to discharge patients prematurely. In this way we will provide local councils with the investment and the incentives to improve care for older people.

"Taken together the NHS Plan and the next steps announced today amount to the most radical and fundamental reform programme inside the NHS since 1948. I want to pay tribute to the staff in the NHS, not just the nurses, doctors and consultants, but all the staff—the different medical disciplines, the ancillary staff, the secretaries, receptionists, porters and cleaners. They represent the very best of British public service and I believe that as a nation and as a Parliament we should be proud of the work they do. I know and understand the enormous pressure they are under as the NHS makes these changes. But I know, too, that they share this basic goal: to rebuild the NHS around the needs of its patients.

"This programme of investment and reform will mean each year, every year, waiting times will fall. Last year the maximum wait for a hospital operation was 18 months. Today it is 15 months. By this time next year it will fall to 12 months. By 2005 it will be six months. And by 2008 it will have been reduced to three months. By then the average waiting time for a hospital operation will he just six weeks. No longer will people have to face the dilemma of having to wait for treatment or having to pay for treatment.

"As a party and a government we are committed to providing opportunities to all in our society and not just some. So there will be more effort to prevent ill health as well as treating it—25,000 lives a year saved by the investment we cart now make in preventing and treating heart disease alone.

"The balance of services will shift with more patients seen in primary and community settings, not just in hospitals. Social services will have resources to extend by one-third rehabilitation care for older people. Councils will be able to increase fees to stabilise the care home market and secure more care home beds. And more investment will mean more old people with the choice of care in their own homes rather than simply in care homes. Yesterday's Budget and today's NHIS reforms mean that the NHS Plan will be delivered.

"I want to make two further points, however. Ii is a 10-year plan, as we said in July 2000. By the time of the next election, there will be real and significant improvements. But this cannot happen overnight. It takes seven years at least to train a doctor and up to 15 years to train a consultant. Expectations will be high but they also need to be reasonable and people need to understand that a 10-year plan is exactly what it says: a plan that will take time to be delivered in full. But at least now public and patients will be able to see improvements made stage by stage and independently of government, audited, monitored and inspected.

"Secondly, on one thing there is a consensus. Britain needs to spend more on healthcare. There is no mystery why in Germany there are not waiting lists. They have spent more and have done so for years.

"We can debate endlessly the systems of finance. But one thing is beyond debate: the level of finance had to be raised. And once that is accepted, the choice is not between a system funded out of general taxation, that results in higher national insurance, and some other system that comes for free. Importing the German system of social insurance would cost the equivalent of an extra £1,000 per worker per year, the French system £1,500 per worker per year.

"We on this side of the House believe in the NHS in our heads as well as our hearts. We believe it to be the best and fairest system of providling true health insurance because it is based on the scale of the person's need not the size of their wallet. It is the best insurance policy in the world.

"It is now for those who want to see the NHS not reformed but abandoned, who routinely call it Stalinist, to say honestly what their alternative is, what it would cost and how families and pensioners would pay for it.

"Yesterday we made a choice and we ask the British people to make the same choice. We are proud of our NHS and the people working in it. We are giving it the money it deserves. We are making the changes it needs. Investment plus reform equals results. We will be happy to be judged upon them".

My Lords, that concludes the Statement.

3.56 p.m.

Earl Howe

My Lords, the House will be grateful to the Minister for repeating the Statement, which is self-evidently of great significance for the NHS as well as for taxpayers.

The full implications of this announcement will emerge only over the next few days and weeks. The Statement is long on generalised aspirations and rather short on detail. However, several things are clear. The Government have embarked on a route which is make or break. Not only have they shut off any debate about moving away from a monopoly funding stream for healthcare, and thus distanced the UK from almost every other developed country, they have also staked everything on substantial tax increases, which they told us at the election they would not impose. The macro-economic effects of these plans are perhaps a matter for another occasion, although they are already exciting concern from respected economic commentators.

The health effects, on the other hand—the health gains, the improvements in services, the improvements in productivity—are the things on which the Government will eventually be judged. If they are not to be perceived as pouring ever increasing amounts of money into a black hole, then it is necessary for them to show that the reforms to the system, which the Statement makes so much of, really have created the kind of health service that is capable of deploying the new money efficiently and effectively for patients.

On the real extent of these much trumpeted reforms, I entertain considerable doubts. One of the most striking passages in the Statement was that relating to greater freedoms being conferred at the NHS front line. The Minister spoke of foundation hospitals and foundation PCTs. Can he say what exactly these organisations will be? What legal form will they have? Who will appoint their board members? What constraints and what freedoms will they operate under? I am all for greater autonomy, but what will it actually amount to and how many NHS bodies will benefit?

The power of foundation trusts to borrow was mentioned. Can the Minister say whether this means that they will be able to borrow from the market? Will there be a Treasury guarantee for such borrowings and what will be their effect on the PSBR? Borrowing necessarily implies repayment. How will such repayment be provided for? Will borrowing just be a way of anticipating future cash allocations, thus storing up difficulties for later years? When will we have full details of what is proposed?

The White Paper speaks about financial incentives and penalties. I found that section pretty baffling, but one of its features is apparently to be that if a trust fails to deliver its targets, money will be taken away from it. How will this work? How will it be possible to avoid a situation where money that is taken away gives rise to cuts in capacity, which in turn lead to a downward spiral of delivery against objectives?

The Statement referred to a new system for money to flow around the health service. Will the Minister say what is meant by that, if it is not what we have long advocated and what the Government abolished when they came to office; namely, money following the patient? How exactly will that be achieved?

To deliver reform on the appropriate scale will require investment in IT. The Government admit that they have not spent enough on IT to date and in particular that there has been inadequate progress in delivering electronic patient records, which is one of the key building blocks for an efficient, patient-centred service. If there is to be greater devolution within the health service, how will the Government ensure that the right IT systems are commissioned?

I turn briefly to accountability and audit. The Statement referred to the independence to be conferred on the new commission for healthcare audit and inspection. Will the Minister say who will set the budget for the commission and from where its funding will be drawn?

Finally, I turn to the shortage of beds. It seems extraordinary that a Government who have been willing to countenance—not to say engineer—a drastic downsizing of the care home sector should now be seeking to shift the blame, and the burden, for bed blocking on to local authorities. Can the Minister confirm that the Government intend to make council tax payers foot the bill for bed-blocking problems? How can that be a fair deal when, as we know from some parts of the country, there is a drastic shortage of care home beds—a shortage that was brought about quite deliberately by the Government's policies?

It is perhaps a cause for some small comfort that the Government recognise that money alone cannot deliver the improvements in healthcare that we all wish. That also requires reform. The test for them is to turn their rhetoric on reform into reality. I for one profoundly doubt whether the scale of the reform will be anything like sufficient to ensure that the substantial new sums that are earmarked for healthcare will add commensurate value to the NHS and the patients whom it serves.

4.2 p.m.

Lord Clement-Jones

My Lords, I, too, thank the Minister for repeating the Statement that was made in another place.

We on these Benches welcome the references in the Chancellor's Budget yesterday on health funding and some—I stress that word—of the Secretary of State's Statement. I believe that that extra funding represents a victory for patients and "game, set and match" in terms of the arguments that the Liberal Democrats have been making, in some cases since the 1997 general election.

First, we on these Benches welcome the announcement of more resources for healthcare and believe that it should be funded from general taxation in a transparent and accountable manner. We have been making that argument for a considerable period. We believe that that represents the fairest form of social health insurance. That is in stark contrast to the position of those on the Tory Benches. We believe that Mr Wanless has actually got it right.

Secondly, I stress the need for social care funding to keep pace with NHS funding, which will ensure that hospital beds are freed up and that older people in particular can be cared for properly in the community. Whether the figure is 19,000 or 30,000 beds, the fact is that there has been a drastic reduction over the past three years. It is good that the Government have finally recognised that fact and that local authorities will now have the ability to fund domiciliary and residential care. In addition to that great change of heart by the Government, I hope that they will examine very carefully the arguments for providing free long-term personal care. They have already come quite a way in our direction; it takes just a little extra to come even closer.

Thirdly, I stress the need for the independent audit of standards and the need to establish whether money has been reaching the areas for which it was allocated. I referred to that in my last Starred Question. Throughout the passage of the National Health Service Reform and Health Care Professions Bill we have argued strongly for an independent audit body. It is good to see the Secretary of State and the Chancellor taking note of debates in this House. I trust that the Select Committee to which the audit body will be accountable will follow very closely the proposals that we made from these Benches and which were supported by those on the Conservative Benches. Whoever said that arguments in politics do not have happy outcomes?

Many matters, however, need to be clarified. What is the timing for putting the initiatives into practice? The NHS, as I have pointed out on many occasions, is groaning under the weight of new initiatives. We have beacon hospitals and earned autonomy, and now we have foundation hospitals. So it has gone on in many different areas.

We argued at the outset—at Second Reading of the National Health Service Reform and Health Care Professions Bill—that that Bill should be delayed. We did so in our very confident belief that those reforms were half baked and would rapidly be superseded. So it has proved to be. The Bill has already been superseded by the Secretary of State's Statement. Will the Minister arrange for the Bill to be delayed so that the new audit body, which we welcome—it appears that it will be a combination of a number of different audit bodies—can be included? Or is he planning to table amendments on Report next week? That would involve a fairly superhuman effort. That demonstrates the way in which the Department of Health and the Secretary of State in particular currently operate. We get initiative piled on initiative and legislation piled on legislation. When will it ever end?

When will the merger with CHI take place? The National Care Standards Commission is barely up and running—I refer to the acute hospital inspection side—but it will be merged with CHI. When will CHI be merged with the new body? Even if the body is not going to be merged, there are already 21 mechanisms in the health service for clinical governance. We should be thankful for small mercies and pleased that we do not have a 22nd mechanism. There is a plan for some simplification of the system for clinical governance.

Much time has been lost—five years to be precise—on the argument for funding the health service transparently from general taxation. The Government are no longer dissembling in that respect. We need to ensure that professionals and managers are allowed to get on with the job in the health service. Will the Government now desist from setting any more targets? Those that we have are ambitious enough, despite the Government's spin, the reports of chief executives and so on. Will the Government now ensure that money that is allocated to the health service gets to the intended services? Apart from through the Audit Commission, how will that be done?

Finally, I pay tribute to the NHS as a body and to NHS staff. I know that they will welcome the Chancellor's additional funding. However, they will have extreme reservations about the Secretary of State's Maoist approach to management. That approach involves hyperactively changing every initiative before it has had a chance to take effect. I hope that, in implementing these initiatives, the Secretary of State will take all of that into account.

4.8 p.m.

Lord Hunt of Kings Heath

My Lords, I thank the noble Earl, Lord Howe, for what I believe was a welcome to at least the announced allocation Df resources to the NHS in future. Sadly, he did not say whether the Conservative Party would make a similar commitment of resources to the NHS. I agree with him that there is much detail in the proposal to be debated. We look forward to hearing more about his party's intentions.

The noble Earl's first substantive point was whether the current system of funding the NHS was the right one. I am delighted that my right honourable friend the Chancellor of the Exchequer made it abundant y clear that we believe that the current system of funding is indeed the right one, provided that that is accompanied by the reforms that are contained in the Statement. The Budget and the review documents that were published yesterday contain detailed information on alternative systems of funding. For instance, on funding by private insurance in the United States, those documents show that premiums average around £100 a week and are set to rise by £13 a week on average next year. As a result of those costs, that system insures only some of the people for some of their care.

Those documents also show that, on social insurance, the narrower base for contributions in France means that a typical employer pays £60 a week. That can place many costs on employers, it can have an impact on the economy and it affects employers' ability to create new jobs.

The report also shows that charging for clinical services, which would involve a healthcare system based on medical charges whereby patients would pay rising bills for individual operations and treatments, would mean, in effect, that the sick would pay more for being sick. It is the Government's view not only that the NHS system of funding is the most equitable, but that by offering the most comprehensive insurance policy to meet rising costs from medical advances, a reformed NHS can give people the greater security that they need.

I agree with the noble Earl about the crucial nature of this announcement and the future facing the NHS. There is no question but that this is a make-or-break situation for the National Health Service. It must show that it can change and reform and meet the expectations of the public with the resources that will now be made available.

The noble Earl asked about productivity. That is why we are introducing more freedoms into the system. We are introducing the right kind of financial incentives to make people behave in a way that will deliver the type of reform programme that I have described.

The noble Earl also asked for specific details about foundation trusts. I believe he will understand that I am not in a position to give precise answers because we still have to work through many of the details. However, I am convinced that if we are to have ownership of decision-making at local level, if we are to energise people and ensure good leadership in those who run the trusts, and if we are to get more people involved locally in what they do and support what they do, it is right to create foundation trusts.

It is extremely significant that the discussions that we have had with the chief executives of our most successful trusts indicate that they are very enthusiastic about the kind of freedoms that can be given when we create foundation trusts. In my view, an important potential of foundation trusts is that they are seen far less as agents of central government and far more as locally owned organisations which owe their accountability to the people whom they are there to serve.

The noble Earl asked me about financial incentives. At present, successful NHS trusts can exceed the activity that had been agreed with commissioners. However, in essence, there is no resource to pay them to do the extra work. It must make sense to incentivise the health service in order to ensure that those who can do more receive the rewards for doing so. Of course, it must be done in such a way that perverse incentives do not arise, and it must be done in relation to effective referral protocols. But surely the emphasis should be placed on rewarding those who do well rather than providing excuses for NHS organisations which do not.

As someone who has spent his career in the health service, the one point that I would make is that there is a great deal of difference between different organisations. We must not approach the NHS from the point of view that all organisations must be treated in the same way and that all are as good as each other. The work of the Commission for Health Improvement readily identifies enormous differences in the quality of work that is being done.

There is no doubt that the health service has invested inadequately in IT. I very much hope that the package announced yesterday by my right honourable friend the Chancellor will enable the proper investment to put into IT. I believe that, while the thrust of what we are saying today concerns devolution, IT is one area where there needs to be central leadership. We shall give that leadership. We shall also ensure that organisations are aided through advice and support to enable them to make the best of their IT. I consider IT to be fundamental to the reform process.

With regard to inspectorates, I am not in a position to respond to the noble Earl in relation to resources. Of course, we need to work fully through the details, but I assure the noble Earl that we shall resource the new inspectorates adequately because we want them to do a very good job. He will also have noted that we intend them to be more independent. I believe that noble Lords who have debated this issue in the National Health Service Reform and Health Care Professions Bill will welcome that very much.

If I may say so, the noble Lord, Lord Clement-Jones, started in a very constructive mode. I believe that he claimed that the announcement was all due to Liberal Democrat policy. I certainly welcome his support for the general funding of the NHS. I believe that we have done rather better than the penny on income tax proposed by his party. I also welcome the comments that he made about social care funding. If there is one thing that we have learnt, it is the importance of integration between decisions in health and social care. Clearly, if we are to deal with the issue of delayed discharges, we must have an integrated approach. I do not agree with him about personal care. I passionately believe that the money is better spent on intermediate care. That is where we shall spend that money.

The noble Lord, Lord Clement-Jones, echoed the theme that the noble Earl. Lord Howe, often raises; that is, that the Government are guilty of weighing down the NHS with too many initiatives. In the planning priorities guidance for next year, we have recognised the need to focus the NHS on the issues that really matter. The Statement which I have repeated today focuses on the issues of waiting and choice— matters which are very important to the public. The new initiatives that we have announced—the financial incentives and the freedoms for trusts—are all designed to focus the NHS and to move away from a system where too many priorities are involved.

However, in many debates—and, indeed, today—when the noble Lord talks about ensuring that money is directed to the services which are important, he is as guilty as anyone of seeking to micro-manage the health service from the centre. We resist that temptation. We wish to give much greater flexibility at local level. Of course, it is important to ensure that services such as those for cancer are funded adequately at local level. It will be the role of strategic health authorities to performance-manage that. However, I consider it to be most important that we give as much freedom as possible at local level.

Finally, the noble Lord asked about the progress of the current National Health Service Reform and Health Care Professions Bill. We are extremely satisfied with the Bill as currently drafted. We consider it to be important and we shall certainly proceed with it. We look forward to its Report stage in a few days' time. Of course, some of the measures that we have announced today will require primary legislation, but the noble Lord knows that I cannot possibly comment on when that might come before your Lordships' House.

4.18 p.m.

Baroness Pitkeathley

My Lords, during my five years in your Lordships' House there have been few Statements that I have welcomed as wholeheartedly as I do this one. Indeed, it has already raised morale. I know that because this morning I spoke to some of the dedicated staff to whom I and many others owe our lives. I particularly welcome the increased incentive to bring about co-operation between health and social services. I believe that the phrase "bed blocking" is unfortunate, and I am glad that my noble friend used the term "delayed discharge" instead.

However, I want to ask my noble friend whether he agrees that, when it comes to promoting co-operation between health and social services, carrots are better than sticks. Can he give me an assurance that any penalising of either health or social services will be kept to a minimum? Further, can I ask him for an assurance that encouragement will be given to build on the excellent work and relationships established by the National Care Standards Commission and an assurance that it will not replaced by the new commission?

Lord Hunt of Kings Heath

My Lords, I agree with my noble friend that the announcement in yesterday's Budget and our intent today will bring great joy in the National Health Service. Not only are extra resources being provided, but stability over a five-year period, which is important.

I also agree that the term "delayed discharge" is probably a better one to use, although I detect from the Liberal Democrat Benches that even that term does not appeal to all Members of your Lordships' House. We all know why we need to tackle the issues with gusto. We know of the problems that there have been despite the generally good work undertaken by health and local authorities. There have been capacity problems in terms of getting people out of hospital, but intermediate care is one way in which that is being tackled.

At the end of the day, an incentive system, which is based on schemes in Denmark and Sweden, is the right way to go. I believe that the 6 per cent extra resources per year in real terms for social service authorities over a three-year period, plus "incentivisation", is the best way forward. I agree with the noble Baroness that it is better to use a carrot than a stick. Some sticks are needed and the financial incentives will work in the sense that the more enthusiastic local authorities are and the greater their ability to hasten the appropriate discharge of patients from hospitals, the more resources they will have for other services. The less local authorities are able to do that, the fewer resources they will have. I believe that that is the right kind of incentive.

In relation to care homes, we have all looked with concern at the viability of some of them. I believe, and it is our expectation, that the resources that we are now making available to the social service authorities will enable, where appropriate, an increase in fees to care homes to take place.

Lord Roberts of Conwy

My Lords, perhaps I may press the Minister a little harder on the issue of where the present National Health Service Reform and Health Care Professions Bill stands. In light of the White Paper, to what extent will that Bill and its provisions become redundant? The Minister sounded somewhat complacent about the timing of the legislation to come. Nevertheless, I am sure that he will be aware, as I am, that promises have been made to improve the NHS by the time of the next election. Four years is not a great deal of time when primary legislation is required.

The Minister referred to the training of doctors and consultants. Will he say a little more about the Government's plans? Perhaps I should declare an interest as president of the University of Wales College of Medicine. We are anxious to know the Government's plans. Did I understand the Minister to mean that some of the money allocated to the health service could be put directly into social care?

Lord Hunt of Kings Heath

My Lords, on the final point about social care, the funding of social service arrangements to help the discharge of patients will go down the normal route of allocation to local authorities. On the other hand, we have arrangements for the pooling of resources. There is a partnership between the health service, local authorities and care trusts. We are keen to see integrated services. There will be different pools of money, but the specific "incentivisation" of local authorities to improve arrangements for patients when they are discharged will come through the normal local authority allocation route.

In that respect, under the arrangements that are agreed between health authorities and local authorities at a local level, if health services were actually responsible for the problems in terms of discharge, they would face the financial penalty. I want to make it clear that there is no suggestion of simply targeting local authorities and saying that they are the ones to blame and no one else. We want a partnership approach.

On the Bill, I am not complacent, but I was given due warning by the Chief Whip, who reminded me that at this stage I cannot say at what point legislation could be introduced to take forward some of the proposals. What is clear from the Statement is that further primary legislation will be required. I regard the current NHS Bill as a stepping-stone. It contains important measures in relation to patient and public involvement in the health services in Wales, as the noble Lord knows, primary care trusts, strategic health authorities and regulation of the professions. We are anxious to see that enacted.

On the training of doctors, the noble Lord will know that we have seen a considerable increase in the intake of medical schools in the past few years. By the autumn of this year, for example, we estimate that that intake will be 1,250 a year more than in 1997 and that it will increase to 1,950 by 2003. Clearly, as the Statement mentioned, it takes a long time to train a doctor, and even longer for a doctor to become a consultant. That is one of the great inhibitions in expanding the capacity and it is one of the reasons why we look to nurses and to other professions to take on more responsibility. We are making progress and the new contracts that we are negotiating with the leaders of the doctors' profession will also enable us to meet some of the current shortfalls.

Baroness Howarth of Breckland

My Lords, as someone who has worked in a local authority and a health authority area for many years, I welcome the announcement. I have a question about the timescale. The Minister said that it was not possible to give the House the timescale, which I understand. However, can he tell the House how we are to keep the morale of staff in those services at top notch with the degree of uncertainty that they experience?

I declare an interest as a member of the board and vice-chair of the National Care Standards Commission. That commission has been operating for three weeks and we have just re-organised hundreds of staff into 70 offices. The Minister will know that we do not yet have all the standards in place. While I believe that there is a need for further re-organisation and inspection, timing is crucially important. It is also important for the staff to understand where they stand in relation to their jobs. Managing that is critically important.

The management of change requires sensitivity as it is a delicate task. As the noble Lord, Lord Clement-Jones, said, we have had huge change. It will affect the delivery of service and the productivity that people can deliver. Often their efforts are redirected into the issues of change rather than into primary care. The National Care Standards Commission inspects the institutions that care for the most vulnerable people in our community. Can the Minister tell the House whether the Government are considering issuing messages, in some detail, to staff about what this change will mean to them? It is no use having general reassurances about how wonderful they are—we all think they are absolutely wonderful. They need to know what will happen to them tomorrow.

A second point is whether the Minister will consider other IT programmes before developing the health service's new IT programme. I say that from my experience of at least three government IT programmes, which frankly, when they were accepted by the people for whom they were commissioned, were near disasters. We should at least get that right in the next round.

Lord Hunt of Kings Heath

My Lords, in relation to IT we need to learn the lessons of past efforts in central government. Looking back over quite a long time, the NHS has had a number of IT initiatives that have ended in failure. One reason why the NHS moved away from central direction was because of the failure of some central IT projects in years gone by. We need to get the balance right and to have greater central direction. We need to give a good deal of help to local people to work within a system that enables the NHS as a whole to work together and to work across organisational boundaries. Certainly we are seeking advice from across government and the private sector on IT matters. I very much take on board the points raised by the noble Baroness. While we are disappointed with progress in some areas of IT, there have been some significant achievements on which we need to build.

I pay tribute to the staff of the National Care Standards Commission, the Commission for Health Improvement, and indeed, the Audit Commission, as it is important to place on record my gratitude for the outstanding work that has been undertaken. In the case of the Audit Commission, it is universally agreed that the value-for-money studies have been outstanding. We are anxious to ensure that the quality in the new inspectorate is kept to the same high order. I pay particular tribute to the Commission for Health Improvement because, from a standing start, it has undertaken a huge number of reviews. The staff of the National Care Standards Commission have also had to start from a blank sheet of paper in double-quick time.

We want to meet the current organisations very soon to discuss the practicalities of where we are going. In the meantime, we wish to encourage them to carry on the good work, and to work together because many of the changes that we are making can start by organisations collaborating. I know that they already do so very effectively. It is worth remembering that the staff of the current organisations will form the broad bulk of those who will go into the new organisation. We need to talk through the details, but I am anxious to ensure that the people currently in those organisations feel supported and valued.

There has been a clear recommendation from Kennedy. Noble Lords in our debates on the National Health Service Reform and Health Care Professions Bill asked for an integrated approach, which is welcome as a general principle.

Baroness Gibson of Market Rasen

My Lords, it is not a question of only the Government going to the organisation. Will it be possible for the staff, who are the experts, to tell the Government what is going on? Any Government would need their advice.

Lord Hunt of Kings Heath

My Lords, I certainly agree with that. One of the changes in the health service is the development of staff surveys by individual NHS organisations, which will help the NHS locally to take account of the issues raised. Without the staff, we shall not achieve such changes. The key element in our announcement today is the provision of incentives to encourage the staff to deliver the kind of change programme that we want.

Many members of staff have taken part in the development of the NHS Plan and the NHS modernisation board. We are obviously anxious to continue that effective dialogue.

Lord Eden of Winton

My Lords, the Statement seemed to suggest that someone needing hospital care could shop around between hospitals and determine which one to go to. That all seems fine, but it is extremely difficult for people to get the information that they need to enable them to make that kind of choice.

I have in mind a case that was brought to my attention last week. A patient was due to attend hospital for urgent treatment, but the hospital said that it could not treat him for several months. While that patient waited for treatment, he died. That is not a unique case. If the patient, or the people looking after him, had had information about going to another hospital for treatment, his life might have been spared. How will the system work in practice? If one hospital cannot offer treatment, how will information be conveyed to patients that treatment is available elsewhere? Will their GPs be told? How will information be held centrally so that all patients at all levels of income will know where they can get the treatment that they need?

Lord Hunt of Kings Heath

My Lords, I could not agree more with the noble Lord. Without information, it is difficult to see how a patient can have choice. I confirm that GPs must play a crucial role in helping to advise patients on choice and in making judgments about the most suitable hospital to attend.

I accept that at a national level we have to ensure that information is available to enable patients to make an informed choice. One of the purposes of the new health inspectorate is to ensure that this kind of information is provided robustly so that patients can make sound decisions.

We are starting pilots on the choice scheme from July this year for coronary heart disease patients. Anyone who has waited for more than six months for a heart operation will be contacted by a patient care adviser to discuss the options for treatment. Such patients will be offered a shorter wait at another NHS or private hospital, or even the option of treatment abroad.

We are putting in place members of staff who can help patients to make decisions. GPs will have an equally important role. Ultimately, we need to build greater capacity into the health service. As the years go by and we have more beds, more hospitals and more staff, the element of choice will become greater.

Lord Chan

My Lords, I speak as a non-executive director of a primary care trust. I welcome the fact that there will be more resources to eliminate the negative budget that we received. Much of the money is already allocated to a number of projects, so will the Minister assure us that, in the auditing and inspection of primary care trusts, sufficient time will be given for us to settle down and get on with our work? Will he also assure us that unnecessary and unsustainable public expectations of immediate and major changes will not arise?

Lord Hunt of Kings Heath

My Lords, I am grateful to the noble Lord for raising the matter of primary care trusts. I understand what he says about not wishing to load new organisations with too many responsibilities. Of course, we need to ensure that PCTs are focused on the essential elements of not only producing good services but of commissioning effective services.

Primary care trusts are an essential component of the reform process. That is why it is important that three-quarters of the budget will be spent on PCTs by 2004. I know from our debates on primary care trusts that some noble Lords caution us about giving that level of resource to PCTs by 2004, but the Government believe in the potential of PCTs and in putting money with GPs who will make essential decisions in the NHS. We must press on with that as urgently as we can.