Lords Sitting of 20 October 2003

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

The Lord Bishop of Liverpool
James Stuart, Lord Bishop of Liverpool—Was (in the usual manner) introduced between the Lord Bishop of Oxford and the Lord Bishop of Sheffield.

Public Finances
2.40 p.m.
Lord Northbrook Lord Northbrook asked Her Majesty's Government:
Whether they expect a deterioration in the public finances compared to Budget estimates.
The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord Mclntosh of Haringey): My Lords, on the basis of cautious assumptions audited by the independent National Audit Office, the public finances are sound and the Government are on track to meet their firm fiscal rules over the economic cycle. An interim forecast update for the public finances will be published as usual in the Pre-Budget Report.
Lord Northbrook: My Lords, I thank the Minister for his usual informative reply. As Treasury forecasts are about 15 per cent below independent forecasts for 2003–04 and no less than 30 per cent below forecasts for 2004–05, does he believe that Treasury forecasts are hopelessly optimistic? Does he agree with the Institute for Fiscal Studies that at some stage in the near future taxes will have to be increased by about £11 billion to return to the previous caution about the Chancellor meeting the golden rule?
Lord Mclntosh of Haringey: My Lords, I apologise if my answer was informative. It was certainly not intended to say anything other than is in the public domain already. I shall respond to the speculations of the noble Lord, Lord Northbrook, when we debate the Pre-Budget Report.
Lord Saatchi: My Lords, perhaps the Minister would accept a plain English version of what is happening in public finances. Is it true that every day this year the Government have spent twice as much money as has come in by way of tax receipts? Is that the reason why the Chancellor has quadrupled his borrowing forecast from £30 billion to £120 billion and why he is now on his borrowing limit? Is that also the
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reason why the Treasury is now planning new taxes on car owners and home owners to fill the black hole that has been created in the public finances?
Lord Mclntosh of Haringey: My Lords, as ever the noble Lord, Lord Saatchi, is eternally ingenious in finding new statistical ways to express the same speculation, but it is still speculation. He knows as well as I do that the accusations about new taxes on home ownership and on car ownership have only this morning been authoritatively denied by the Financial Secretary to the Treasury. In due course, he will have a response to the rest of his speculation when we have the Pre-Budget Report.
Lord Barnett: My Lords, while recognising that the noble Lord, Lord Saatchi, will believe almost anything, could my noble friend comment on the fact that the Office for National Statistics has beer revising its forecasts on actual facts and economic growth? Can we believe anything that the Office for National Statistics tells us?
Lord Mclntosh of Haringey: My Lords, the changes in the estimates of GDP growth from the Office for National Statistics result from the adoption, only this year I am sorry to say, of an instruction from the European Commission about chain-linking, which was issued in September 1998. Other European countries have already adopted that chain-linking method, which is better because it takes a longer measurement period for the estimation of GDP growth. In every other way, and indeed in this way, the Office for National Statistics has a very high reputation among international statistical organisations for the accuracy of its figures.
Lord Newby: My Lords, I know the Minister hates speculating on these matters, so perhaps I can ask him a factual question. How much larger would the budget deficit need to become beyond the estimate set out in this year's Budget before the Government break their own golden rule?
Lord Mclntosh of Haringey: My Lords, the noble Lord, Lord Newby, is as well informed about the golden rule as I am. He knows that in order to maintain the golden rule we would have to borrow only to invest over the period of the cycle, and, in order to adhere to the sustainable investment rule, we would have to keep our debt below 40 per cent. I repeat what I said in my first Answer to the noble Lord, Lord Northbrook, we are in no danger of breaking either of our fiscal rules.
Baroness O'Cathain: My Lords, in answer to the question of the noble Lord, Lord Barnett, the Minister said that the international reputation of the Office for National Statistics is very high. That may be true, but certainly its national reputation is not. Of the growth forecasts for the past 12 months, is it not true that 11 of them had to be revised?

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If, as the Minister said, the directive from the European Union was in 1998, and it has only now been chain-linked, what will happen with the introduction of HICP? Will we have a similar problem where the statistics cannot believed?
Lord Mclntosh of Haringey: No, my Lords, the Chancellor has made very clear the extent to which the harmonised index of consumer prices will be implemented. It will of course be implemented for the purpose of the rules on which the Bank of England Monetary Policy Committee conducts its business, but it will not have an effect on any of the other things on which there has been speculation; notably pensions payments.
Lord Tomlinson: My Lords, as my noble friend cannot be tempted to speculate about the future, can I invite him to look back over the recent past and to tell us a little about the background against which the Budget estimates will be produced—record periods of low inflation, record periods of low interest rates and an economy that has managed to miss the general decline in productivity that has taken place in many other European economies?
Lord Mclntosh of Haringey: My Lords, in the well-worn phrase, my noble friend is absolutely right. I have had the opportunity to stand at this Dispatch Box for nearly six and a half years listening to accusations about the economy and to forecasts of disaster for the economy—notably from the Conservative and Liberal Democrat Front Benches—all of which have proved to be unfounded.
Lord Howe of Aberavon: My Lords, does the noble Lord acknowledge that this Government came into office upon the foundation of the extremely well managed economic policy of their predecessors? The noble Lord has been very anxious to describe everyone else's comments as speculative and he rests huge confidence on those of the Treasury. Would he bear in mind that the Treasury's forecasts sometimes turn out to be even more speculative than other people's?
Lord Mclntosh of Haringey: My Lords, I can partly agree with that. Certainly, it is true that the economy of this country has performed well in comparison with other G7 states, not just for six and a half years, but for approximately 10 years. Credit for that must be given to more than one administration. I do not accept the rest of what the noble and learned Lord, Lord Howe, said even from his great experience. In fact Treasury forecasts—which were particularly unreliable in the last years of the Conservative government, even when they were doing rather well—have proved to be exceptionally reliable and have outshone those of independent assessors.

Bullying at Work
2.49 p.m.
Baroness Gibson of Market Rasen Baroness Gibson of Market Rasen asked Her Majesty's Government:
What progress has been made on strategies to eradicate bullying at work.
Lord Evans of Temple Guiting: My Lords, the Government believe that employees should be able to work without fear of being bullied or harassed by employers, fellow employees or anyone else. The Government very much welcome and support awareness raising initiatives in this area, such as the Ban Bullying Day that took place last Thursday, organised by Amicus and supported by the Andrea Adams Trust, a charity chaired by my noble friend Lady Gibson of Market Rasen, which is doing vitally important work in this area. We note that the Post Office, Rolls-Royce and many other large organisations took part in the day.
Baroness Gibson of Market Rasen: My Lords, I thank noble friend for that reply. Is he aware that since we debated the Dignity at Work Bill in your Lordships' House in November 2001, increasing numbers of employers and employees have been working together to ensure that bullying is eradicated from their workplaces?
Lord Evans of Temple Guiting: My Lords, my noble friend is right. A number of important initiatives are now under way to stop bullying at work. The Department of Trade and Industry is considering a proposal under the Partnership At Work Fund for a nationwide survey of bullying at work. The Health and Safety Executive is developing stress management standards, one of which will relate to bullying. The Advisory, Conciliation and Arbitration Service is active, but ultimately the Government can make only a contribution in the fight against bullying. That is why we so much welcome working with unions, companies and others to achieve the goal of reducing the enormous problem of workplace bullying.
Baroness Howe of Idlicote: My Lords, is the Minister aware that no fewer than 20,000 phone calls complaining about bullying are made each year to Childline? Does the Government's strategy include research on the extent to which children who are bullies at school continue their unacceptable behaviour into the workforce? If, as we would expect, the resulting numbers are significant, what further action do the Government intend to take within the school system to eradicate bullying there? Would that not be an effective way to nip workplace bullying in the bud?
Lord Evans of Temple Guiting: My Lords, the noble Baroness is absolutely correct to say that bullying in schools is as widespread as bullying at work. In both areas, it is a huge problem that we must aggressively

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attack—if that is not interpreted as bullying language. We are doing much in schools. Every school must have a written policy on tackling bullying. Ofsted inspectors are giving priority to talking to children about bullying when they inspect schools. Heads and governors will be encouraged to adopt an anti-bullying charter to help them review what they are doing.
The noble Baroness asked an interesting question about the crossover from bullying in schools to bullying in the workplace. I do not know whether there are any figures. If there are, I shall certainly send them to her, but common sense would say that if one bullies at school and gets away with it, the chances are that one will take those anti-social habits into the workplace. So my guess would be that there would be a high correlation between children who bully at school and those who bully at work—and perhaps even between children who are bullied at school and those who are bullied in the workplace.
Lord Marsh: My Lords, given that we would all entirely accept the need to protect children, does the Minister not feel that there is a marginal difference between the protection of children, and our obligation to do so, and the protection of adults in the workplace? Even if it is possible—which I doubt—does he really think it desirable that Ministers and the Government should take on the responsibility of controlling workplace relationships?
Lord Evans of Temple Guiting: My Lords, the first point is that children are vulnerable and therefore must have the maximum protection. We would all agree with that. My view, and that of the Government, is that, as I said, the Government can make only a contribution: this is not a problem that we can solve on our own. But we must do everything that we can to encourage the absolute defeat of bullying in the workplace. As I said, the Government will work with any initiative or organisation to help us to achieve that.
Baroness Barker: My Lords, is the Minister aware of the case in which a man and a woman brought the same complaint against someone who was bullying them? They were forced to do so under the Sex Discrimination Act 1975. The man lost and the woman won. Does he agree that we need more specific legislation rather than using other legislation to deal with the issue?
Lord Evans of Temple Guiting: My Lords, it is difficult for me to comment on individual cases. I noticed that in last Friday's newspapers, two cases of bullying at work were reported in two different newspapers. At present, the Government's view is that legislation will not work to defeat bullying in the workplace—probably, almost certainly, for the reasons given by the noble Lord, Lord Marsh. It is
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such a complex issue; it needs delicate handling; we feel that the law would be a blunt instrument to solve the problem.
Lord Davies of Coity: My Lords, is my noble friend aware that shop workers suffer abuse and violence in their place of work from the shopping public? That is a form of bullying; how is it treated?
Lord Evans of Temple Guiting: Yes, my Lords, that is a form of bullying. Last week, I visited a hospital and was appalled to see reception staff wearing bullet-proof jackets. The whole question of violence and bullying in the public and private sectors is something to which we must give constant attention.

GM Crop Trials
2.56 p.m.
Baroness Byford Baroness Byford asked Her Majesty's Government:
Whether the Secretary of State for Environment, Food and Rural Affairs would be prepared to use her discretion to allow a trial of genetically modified crops to go ahead without publication of the exact location of the trial.
The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty): My Lords, decisions on proposed GM crop trials in England are made on a case-by-case basis. Accordingly, the level of detail at which we require trial site locations to be notified and published would depend on what was considered to be proportionate in terms of safety and the need for transparency in each case. To date, we have required such locations to be notified and published at a level no less specific than 1 square kilometre on an Ordnance Survey map.
Baroness Byford: My Lords, is not the Minister concerned that Bayer, for example, and now Monsanto, are withdrawing from field trials—Bayer, in particular, because it cannot guarantee that the trials will be completed? Would it not be sensible for those six-figure digits not to be placed on the web? It is right that they should be known, but to allow people to come to trash trials blocks those trials. Is he not fearful for the future development of crops in seed production?
Lord Whitty: My Lords, I of course condemn anyone who uses that information to trash trials which, as has been shown in the case of farm-scale trials, yield valuable information for making future decisions. However, an issue of transparency is also involved, both locally and nationally. The body that makes recommendations to the Secretary of State on the matter, the Advisory Committee on Releases to the Environment, advised that although the location was not needed for safety reasons it would be important for reasons of transparency. The Secretary of State

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accepted that recommendation. Regrettably, Bayer felt that it could not proceed as a result of that decision.
Baroness Miller of Chilthorne Domer: My Lords, does the Minister accept that it is important for farmers whose land surrounds crop trial areas—and, indeed, beekeepers, who may be keeping their bees within 2 or 3 kilometres; or, reputedly, up to 16 kilometres of a trial site—to have access to that information, so that they know what is happening to their livelihoods?
Lord Whitty: My Lords, without necessarily accepting the distances to which the noble Baroness refers, it is of course important that neighbouring farmers know what is being grown close to them, whatever the size of the trials. That is one reason why the committee and the Secretary of State felt that we needed to divulge that information.
Baroness Hayman: My Lords, my noble friend rightly mentioned the need for transparency, but does he accept that farmers who participate in the trials or, for example, in the Krebs trials on bovine TB, are doing a great service by providing proper scientific data under which case-by-case decisions can be taken? In those circumstances, do they not deserve some protection—if not by hiding the trial sites, at least by adequate police protection against illegal action by people who only want to trash, not to achieve scientific results?
Lord Whitty: My Lords, I accept that those conducting such trials are providing a service and deserve protection. It is important that the police and the courts take those duties seriously.
The Countess of Mar: My Lords, is it not apparent that the trashing is by people purporting to belong to non-governmental organisations such as Greenpeace? Further to the previous question, are they not using bullying tactics, and should they not be persuaded to be effective through argument and scientific proof rather than by ruining other people's crops?
Lord Whitty: My Lords, it has been the Government's stance throughout that organisations objecting to the commercialisation of GM crops should allow the trials to proceed in order that we get information. It is ironic that, when some of the information that emerged appeared to go their way, organisations seized on the trials as important, whereas a few months ago they had been involved in trashing the crops or disparaging the trials.
Baroness Byford: My Lords, perhaps I may press the Minister further. If the original decision by ACRE was that the location of the trials should be known, is the Minister not concerned that we will export our ability to carry out the research needed to bring greater benefit to crops in the long term? At their trial, people
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accused of trashing were found not guilty. As a consequence, there is nothing to stop such people; they are not technically breaking the law. If that is so, should not ACRE reconsider the decision that it took all those years ago?
Lord Whitty: My Lords, the decision was not taken all those years ago; the recommendation is quite recent. We have been consistent throughout. Given that there is such concern about GM crops, it is important that the Government act in a straightforward, consistent and transparent manner. It is also important that property is not damaged, and that the criminal justice system and the police take seriously any threat to it. The information from such trials—whether farm-scale trials or smaller scale seed trials—benefits future decisions on the commercialisation of such products.

Agricultural Land: Development Policy
3.2 p.m.
Lord Peyton of Yeovil Lord Peyton of Yeovil asked Her Majesty's
Government:
What changes there have been in their policy concerning alternative uses of prime agricultural land and whether new instructions have been given to government inspectors holding inquiries.
The Minister of State, Office of the Deputy Prime Minister (Lord Rooker): My Lords, in March 2001, the Government amended planning policy guidance note 7 on the countryside, making clear that it was for local planning authorities in the first instance to decide whether to utilise the best and most versatile agricultural land for development. That policy is retained in the recently issued consultation draft of the new planning policy statement 7 but is also subject to a separate review of best and most versatile agricultural land policy conducted by Defra.
Lord Peyton of Yeovil: My Lords, I am not entirely grateful for those rather weasel words. Is the noble Lord aware that underlying the Question is the real concern and unhappiness of the inhabitants of the Somerset village of East Coker at the prospect of being devoured by Yeovil? They are also concerned at the reported inclusion of a parcel of prime agricultural land not covered by the inquiry, but included after the inquiry was complete.
Lord Rooker: My Lords, with respect, I thought that I gave a perfectly reasonable and factual Answer to what was a reasonable Question, and I do not consider them weasel words at all. There is a planning policy guidance note; we have not changed the rules; it was published in March 2001; it is currently under review and consultation until 12th December; and another government department is looking at the issue of the best and most versatile land policy. I should have thought that that was straightforward.

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Further to the issue that has motivated the noble Lord, I could hide behind the weasel words of saying that I cannot comment on individual cases because an inspector has looked at the case and made a decision. Given that the case is currently with South Somerset District Council and may come to the Secretary of State at the Office of the Deputy Prime Minister, I cannot comment on it.
Baroness Miller of Chilthorne Domer: My Lords, I am glad that the Minister reinforced the fact that local planning authorities should make those decisions. I am sure that he will agree that they are best placed to make the fine-balanced, difficult decisions between building on flood plains to gain houses required as a result of fortunate employment following the growth of Westland, and the issue of prime agricultural land. How much prime agricultural land has been lost to development over the past decade?
Lord Rooker: My Lords, I regret that I cannot answer the last question. The local inspectors who conduct inquiries are expected to follow national guidance, so there is consistency across the country. We are looking at sustainable development. In some cases, the inspectors may allow a slightly larger development than would otherwise have been the case to make it sustainable for the future.
On land use, it is interesting to note on page 43 of the Sustainable Communities Plan, which was published in February, an interesting map showing that, in England, national parks constitute 7 per cent of the land, areas of outstanding natural beauty 16 per cent, statutory green belts 13 per cent and urban areas 10 per cent. Even if the extra 1.1 million homes planned in the South East by 2016 are built, they will increase development there by only 1.7 per cent. One can see that a huge amount of agricultural land is available in this country. It adds up to 46 per cent of the land.
Baroness Hanham: My Lords, with reference to the Sustainable Communities Plan and the number of homes expected to be built, particularly in the South East, can the Minister reassure us that normal planning protocols will be followed as regards those developments? Can he further assure us that, if a local authority were not minded to accept those developments, the planning process would be subject to appeal, and, if the local planning inspector decided that they should be refused, the Deputy Prime Minister would not override the decision?
Lord Rooker: My Lords, we made it abundantly clear when we published the plan for sustainable communities, particularly the four major growth areas in the wider South East—I say the wider South East as the Milton Keynes/South Midlands growth area goes as far as Corby—that normal procedures would be followed and we would not shortcut the system. We were not saying that the developments would be built.
There is the process through the regional planning guidance and of looking at the figures accepted on a regional basis in RPG9. All cases will be subject to the
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normal planning process. True, some delivery vehicles will be constructed—either urban regeneration companies or urban development corporations and other matters led by English Partnerships. But we do not intend to bypass the normal planning process, in which there is full consultation, discussion and scrutiny of the plans, many of which will take place in the early part of next year.
The Countess of Mar: My Lords, the noble Lord has used the phrase "sustainable communities" several times. Can he assure us that the planning surveys include water supplies, particularly considering that this year has been the driest since 1972, and that drought is likely to be a rule rather than an exception in future?
Lord Rooker: Yes, my Lords. However, I cannot understand why we have not had hosepipe bans. I keep asking why, and I am told that we have had some wet winters. The noble Countess's point is valid. But the Select Committee in the other place did not do its homework properly when it looked into the Sustainable Communities Plan—I have said that outside and I shall say it here. The water companies and the Environment Agency were involved and consulted before the Sustainable Communities Plan was even published. We know that there are problems to be overcome. They are part of the process of managed growth; otherwise, we will have unmanaged growth. The purpose of the Sustainable Communities Plan is to get a grip on managing growth.
Lord Monro of Langholm: My Lords, have the Government given any recent advice to the inspectors and planning authorities about the development of wind farms? Those awful monstrosities seem to be springing up all over the United Kingdom countryside. In the long-term consideration of the landscape of this country, we should be much more careful in what we do.
Lord Rooker: My Lords, that is an energy matter, although I accept that there is also a planning aspect to the question that would be dealt with by part of another department. Those who do not want fossil fuel generation must accept non-fossil generation which causes no pollution to the atmosphere—which could be wind farms, waves or even nuclear energy. People cannot have it both ways. When people in this country put the light switch on in 20 or so years' time, they expect the lights to go on, but they will not if we make the wrong decision now, and our generation will rightly get the blame.
Lord Tanlaw: My Lords, is the Minister aware that in south-west Scotland, where I have an interest in the hills and uplands, when farmers have applied to put up windmills, the main objection comes from the Ministry of Defence? Many farmers cannot understand why

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low-flying aircraft have trouble in negotiating windmills when the aircraft are fast and manoeuvrable and the windmills are stationary.
Lord Rooker: My Lords, that is true. I could reply that I do not answer for Scotland and do not intend to, but there is a problem with radar being near wind farms on the coast. I understand that certain areas near the coast have been designated as suitable for wind farms and agreed with the MoD. That was not the case in previous years and there may be some old planning applications and planning permissions still around. The matter has been dealt with, by and large, but it is true that we cannot use all the coastline because of interference with radar.

Business
Lord Grocott: My Lords, at a convenient time after 3.30 p.m., with the leave of the House, the Leader of the House will repeat a Statement on the European Council.

Privileges
3.12p.m.
The Chairman of Committees (Lord Brabazon of Tara): My Lords, I beg to move the Motion standing in my name on the Order Paper. I am sure that the whole House will wish to join me in thanking the noble Lord, Lord Wigoder, for his service on this committee. The noble Lord has been a member of the Privileges Committee continuously since 1977, which makes him easily the longest-serving member of any Select Committee and is probably a record.
Moved, That the Lord Roper be appointed a member of the Select Committee in the place of the Lord Wigoder.—(The Chairman of Committees.)
Lord Wigoder: My Lords, my noble friend Lord Steel of Aikwood whispered to me a moment or two ago that I should consider myself fortunate that after my name on the Order Paper there did not appear in brackets the word "deceased". I thank the noble Lord for his comments. My principal regret is that I leave the committee just as I was beginning to get the hang of what was going on.
On Question, Motion agreed to.

Health and Social Care (Community Health and Standards) Bill
3.13p.m.
The Parliamentary Under-Secretary of State, Department of Health (Lord Warner): My Lords, I beg to move that the House do now again resolve itself into Committee on this Bill.
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Moved, That the House do now again resolve itself into Committee.—(Lord Warner.)
On Question, Motion agreed to.
House in Committee accordingly.
[The CHAIRMAN OF COMMITTEES in the
Chair.]
Clause 49 [Annual reviews]:
[Amendment No. 281A not moved.]
Earl Howe Earl Howe moved Amendment No. 282:
Page 17, leave out line 37.
The noble Earl said: In moving this amendment I shall speak also to Amendments Nos. 341, 347 and 360. I make no apology for returning to the issue of star ratings. We see in Clause 49 that, in each financial year, CHAI will have to conduct a review of the provision of healthcare by and for each English NHS body and each cross-border strategic health authority and must award a performance rating to each such body.
There is, to my mind, a distinction to be made between performance indicators and star ratings. I have no objection to a hospital being measured against a range of performance indicators. That is often a useful exercise for management in driving up standards across the board. When the process gets corrupted, however, is in the translation of those indicators into crude star ratings. Under the system devised by the Government, star ratings determine a great deal. A three-star rating is currently a prerequisite for a hospital if it wants to apply for foundation status. More generally, it is the goal towards which the management of a hospital strives in order to win the prizes distributed by the Secretary of State under the banner of so-called earned autonomy. But there are wider dimensions as well. Whether a hospital gets three stars, two stars, one star or none can affect the whole range of its activities; chief among which is the ability to recruit and retain good staff. There is no doubt that star status directly affects morale, and it is inevitably the measure by which that hospital is perceived by its patients and the wider public.
Given that so much depends on it, the one thing that we should look for in a star rating system is for it to be a true and fair indicator of performance. Yet that notion was completely blown apart by the report of the Audit Commission earlier this year. The report showed that, in very many instances, a hospital's star status had almost no bearing at all on how good a hospital it was from the point of view of patient care. That is partly because of unreliable data collection; and partly because star ratings are much more to do with internal processes than with the things that most of us would associate with good care and treatment.
Managerial competence is hardly reflected in the figures at all. Indeed, in a revealing section of its report, the Audit Commission states:
"There is a statistically significant relationship between performance and managerial adequacy. The number of DH stars awarded is only weakly related to either".
That is the nub of my objection to the current system. One well-known example of zero star status is the Bath Royal United Hospitals NHS Trust, yet the respected health management consultants, Dr Foster, goes out of its way to praise that hospital as excellent in the treatment it delivers to patients.
Equally, a high star rating need not necessarily indicate good care. That is because the target indicators can often be selective. For example, waiting times for outpatient appointments relate only to the first appointment and not to subsequent ones, although there are twice as many follow-up appointments as first appointments. Similarly, with cancelled operations, only those operations cancelled on the day are counted in the figures, not operations cancelled on the few days preceding that.
The following shows how blunt an instrument a star rating is. One specialist acute trust was rated by the Audit Commission as very good on achieving NHS Plan targets and on most measures of financial and performance management. Another acute trust performed poorly on NHS Plan targets and was rated poor managerially, including significant financial management failings and no signs of imminent improvement. Yet both those hospitals achieved a two-star rating from the Department of Health. The Audit Commission found that, on average, three-star trusts were likely to achieve only 69 per cent of NHS Plan targets compared with 66 per cent in two-star trusts—3 per cent separating two-star and three-star ratings. That small difference hardly seems enough to warrant the very favourable treatment that three-star trusts receive and two-star trusts miss out on.
Star ratings ought to be abolished and I therefore do not think CHAI should be required to award them every year. They are profoundly misleading; and their knock-on effects, whether good or bad, are unwarranted. Exactly the same argument applies to CSCI and the star ratings of local authorities that it is required to award under Clause 77. For the same reasons, those ratings are also unrepresentative and misleading. If we must have targets, the language of performance of those targets should be devised by CHAI and CSCI themselves. It should be a linguistic rating, not a crude numerical one. The Minister will need to do an exceptional job in defending this element of the Bill if he is to start convincing me that these provisions have a value. I do not believe that he can do that. I beg to move.
The Chairman of Committees: If this amendment is agreed to, I cannot call Amendment No. 282A.
Baroness Barker: I rise to support the noble Earl, Lord Howe, on Amendment No. 282 and to speak to Amendment No. 284.
Earlier this year, not long before the House rose for the recess, I spent several hours in the A&E department of a large hospital. It was perhaps one of the most informative experiences I have had and has informed me extremely well for our debates on this Bill. At seven o'clock in the morning, when the newspaper shop opened, 1 went to buy a copy of the
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Guardian, as one would, and saw that the A&E department that I was visiting had achieved a low star rating. I was profoundly glad that I did not have the job of telling the people in that department, in the middle of their twelve and a half hour shift, that they were not doing a good job. That is one of the reasons why my noble friend Lord Clement-Jones and I are happy to put our names to Amendment No. 284. The current star performance rating takes precious little cognisance of what patients, other users and clinicians actually feel. It is a management, target-driven process.
I live in an area where people can go to one of two hospitals, both of which offer some of the same services. Given my age group, I know people who will sing the praises of the gynaecology and maternity unit at one of the hospitals but not set foot in the other. Others hold an entirely different opinion. I am not sure how they have reached their conclusions although I am sure that they have good reasons. There is perhaps one main reason why these amendments should be accepted and it relates to the provision of specialist services. I have taken part in various debates in your Lordships' House on specialist services, particularly neurological services. Many neurological patients say that locating good services simply by means of word-of-mouth recommendation is one of the most difficult tasks that they face.
Hospital star ratings do not meaningfully reflect that information. Star ratings by themselves are a crude target. Like the noble Earl, I should like to see the back of them. If they are allowed to continue, they should be the product of consultation with those who really know how hospitals work or do not work and what is wrong with them. I am therefore very pleased to attach our names to Amendment No. 284.
Lord Peyton of Yeovil: I should like very briefly to support as warmly as I can the amendment which was moved in such reasonable terms by my noble friend. I have just one question to ask. Who will actually award the performance rating of each body on behalf of CHAI and what training will they have for dispensing what amounts to a very serious measure of power in this instance? We have to be very careful about giving the power provided in this clause to people who have not had very meticulous training. I hope that the noble Lord will at least take the matter seriously. If he does not, I hope that my noble friend will return to it on Report.
Lord Turnberg: I must admit to sharing some of the concerns behind Amendment No. 282. I share the concern about the reliability of the star system, which I, too, believe is rather a blunt instrument for assessing the abilities and facilities to deliver care for patients. I fear that the correlation between stars and what patients want may not be anywhere near exact. However, I think that there is a need for some form of performance rating. After all, what is CHAI about if it does not try to assess how care is provided in those hospitals? I should like to see not star ratings, but a performance rating that takes a much broader and

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much more sensitive look at how care is delivered. I am not sure that removing the phrase "award a performance rating" will change anything. I think that one can change the star system without removing that phrase.
Baroness Cumberlege: I should very much like to support what the noble Lord, Lord Turnberg, has just said. I know that it is very difficult for the Government to reverse once they have gone down a particular line. In this instance, however, is there not a case for trying to get back into the National Health Service some real confidence in the present system? Perhaps we will have to change the words and reinvent the assessment. However, as the noble Lord, Lord Turnberg, and my noble friend Lord Peyton rightly asked, who is going to do it? Nevertheless, the present system lacks such credibility. There is so much cynicism about it, not necessarily so much among members of the public who I do not think quite understand all the nuances, but certainly among members of staff who are being judged by the system and think it unfair.
Lord Hunt of Kings Heath: As I had ministerial responsibility for performance rating I am overwhelmed by the level of support that noble Lords have shown for both the concept and the practice. I hope that the Committee will excuse me if I rise to defend performance rating, but I do not recognise some of the complaints that noble Lords have made this afternoon.
There is a huge variation in performance between individual organisations within the National Health Service. For far too long, for years, those organisations were allowed to carry on as they were without any external pressure at all on how they were performing. I do not pretend, as I did not when we debated this matter on Thursday, that the current performance ratings are 100 per cent perfect. Of course I recognise that it is very difficult to create an accurate performance measurement which goes across the whole of the work in each individual NHS organisation. However, I think that the key targets and the range of benchmark figures that will inform those targets provide a pretty fair reflection of how well the organisation is doing.
I have been to NHS trusts that received a poor rating and to NHS trusts that received a three-star rating. I have been struck by the positive attitude that many people have taken towards the ratings. There was real pride in the organisations that achieved a three-star rating and a determination to do better in those that did not do so well. Surely that is the attitude that we want to engender in the health service, an attitude in which everyone is committed to improving overall performance.
I understand some of the concerns that have been expressed, but surely we should allow Sir Ian Kennedy and CHAI to take on board those concerns and to come up with new proposals. Sir Ian has already indicated that he wishes to make changes and we should welcome that. Please, however, let us not leave
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the concept that it is right to rate NHS organisations and to provide the public and staff with an indication of those that are doing well and those that are doing not so well. After nearly 50 years in which the public have had very little opportunity to assess their own local hospital, we now have such an opportunity. We should show our confidence that this is the right way to go forward in the future.
Baroness Carnegy of Lour: I am sure that we have all listened to the noble Lord, Lord Hunt, with interest. He knows why the rating system was invented in this way and he knows how he considers it to be working. But the Audit Commission disagrees with him. It is fairly devastated about how it is working. My noble friend's Amendment No. 282A does not suggest that the rating system should be done away with; it suggests that there should be rating, but that it should be in a form to be determined by CHAI.
A difference of 3 per cent between a three-star and two-star rating, with all its implications, must be shocking to the people who work in the hospitals and shocking to the locality and to patients. It is very unnerving. It clearly is too blunt an instrument. The Government should accept that it needs sharpening up very much.
My mind turns to Which? magazine and how the Consumers' Association tackles assessing comparatively simple products, such as motor cars. It looks at endless categories. Within each category, a great many ratings are considered—even for a motor car—before reaching a conclusion. I bought a car that was top of the pops in its range and it goes beautifully. The Consumers' Association did rather well on that, but it was subdivided into a great number of elements.
If the CHAI is to operate the system successfully and, above all, fairly, in a way satisfying to the public and to patients, it must make it much more complicated and subdivided than it is at present. The Government should not turn the amendment down flat. Amendment No. 282A is an extremely good one. I hope that the Government will accept it, or something very like it.
3.30 p.m.
Lord Warner: The noble Baroness spoke about Which? reports. I am old enough to remember that when they were first produced, there was outrage from many providers of goods and services. I am not sure that that is a particularly good experience of which to remind people. Perhaps it is a remarkably similar position to now.
My noble friend Lord Hunt eloquently reminisced about his experiences in this area. I suspect that after I finish speaking, I shall join him in the dock as I make the case for not accepting the amendments. Let me be clear at the outset: we are unapologetic about targets, as such. We are not claiming that all the targets have been perfect. We are not claiming that the present system is perfect. But targets have helped to cut waiting lists for patients. They have increased the number of coronary heart disease operations from

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41,000 to 56,000 between 2000 and 2003. They have taken us to a point where 97 per cent of patients with breast cancer are treated within 31 days of diagnosis. They have reduced delayed discharge of patients from 7,000 to 4,000 between 2001 and 2003. That is just a sample of big improvements for patients.
I am not saying that that is just the result of targets, but targets and ratings concentrate people's minds. They change the focus in many areas where there have been considerable concerns about performance on the part of patients and, in many cases, on the part of many NHS staff. Performance ratings also help to hold people to account. It is worth bearing in mind that we have listened to some concerns about the number of targets. We know that they can cause concerns, not just to managers, but to clinical staff too. The Government have made great strides to address the concerns.
Through the priorities and planning framework for 2003 to 2006, we have set out in a single document a much more streamlined and focused set of targets—62 in total—for the whole of the NHS and social care for the next three years. Before Members of the Committee say that that is still over the top, let us put it in context. It is fewer than one target for every £1 billion of planned expenditure in health and social care over the next three years. I suggest that that is not out of proportion, given the huge sums of public money being developed for patients' concerns.
Performance ratings are only one of the criteria for applying for foundation trust status. We have not made them the be-all and end-all of the application for that status. They also provide an important means of informing the public about how their local NHS hospitals are performing. It is worth bearing in mind that under the present system, for example, the star ratings system published by the Commission for Health Improvement in July 2003 had 10 indicators with a clinical focus, which included outcome indicators such as death rates and emergency readmissions. It is of interest to the public to know how many emergency readmissions there are after discharge. That tells us something about performance in local areas.
It is no good just sweeping the system away as a totally irrelevant system in terms of telling local communities about the performance of their particular hospitals. We have always acknowledged that the system is not perfect, but it is improving and will continue to improve. We certainly have every confidence that, under the leadership of Sir Ian Kennedy, CHAI will make—it has committed itself to make—a proper analysis of the system so that it can propose changes which more adequately meet some of the concerns expressed by the noble Earl and other Members of the Committee.
We must bear in mind that we have come a long way quite quickly. Therefore, it is not surprising that some improvements can be made. However, we must not deny that the targets and performance rating system have brought real improvements for the users of the health service. Amendment No. 282, which would
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remove the obligation on CHAI to issue performance ratings after its annual reviews, is not appropriate. That would deny the public information about the performance of their local trust.
Amendment No. 282A allows CHAI the freedom to determine the form of performance ratings. Of course it is up to CHAI, as the independent commission, to determine expressly how the performance ratings will look and feel. That has always been our intention. We expect CHAI to do that. We know that it is thinking about changes that it would like to see, but that is covered already by existing wording. The amendment is unnecessary.
Amendment No. 341 would remove the obligation on CSCI to issue performance ratings after its annual review of local authorities. The star rating process has now been in place for some time, operated by the Social Services Inspectorate. To our knowledge, few local authorities have raised concerns about it. The majority of local authorities have seen the process as helpful in determining what they need to do to improve their services—whether three star councils or councils with lower ratings.
Performance ratings are an important means for CSCI to inform service users and the public at large about how local authorities are performing in the provision of social care. Another key consequence of removing the power for CSCI to award a star rating, as the SSI does now, is that it would not be possible to complete the annual comprehensive performance assessment process of all local authority services. That would make it difficult to judge which local authorities deserve freedoms to build on good or excellent performance.
I would not expect the Audit Commission to be thrilled about sweeping away star rating systems in relation to CSCI. Amendment No. 347 would prevent CSCI using the lowest level of rating as a measure of poor performance for advising the Secretary of State of the action to be taken to improve such services. That is an important means by which decisions can be taken to improve the quality of local services.
Amendment No. 360 would remove the power of the Welsh Assembly to award performance ratings as a result of an inspection. That would significantly weaken the framework for review and inspection of social services in Wales and would mean less robust arrangements in Wales than in England. That would be unacceptable to people in Wales.
So, as I have outlined, we think there are good grounds for keeping the present system in place while allowing, as the Bill provides, CHAI to make improvements following the process of thought and consultation that it will be undertaking.
Lord Peyton of Yeovil: I am sorry to detain the Minister once again. I thought that I had asked him what kind of people are to make these assessments on behalf of CHAI and what form of training they will be given. Before we give people powers of this kind, I think that we ought to be satisfied that they will be properly equipped to use them. While I do not want to

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go into all the arguments, there is an increasing army of people in this country whose role is to check up on other people working in sharp-end jobs. Only a limited number of people in the health service are capable of making anyone better at what they do, and it is doubtful how many of those would be included in the ranks of CHAI; indeed, it would be a waste of their time if they were.
I return to the question I asked the Minister earlier. If he does not answer it, rather than simply responding in accordance with his official brief stating "reject", he ought at least to leave it open until the Report stage and offer to reflect on it. The summary advice headed "reject" mutilates argument and does not do anything to convince Members on this side of the Committee that the noble Lord is really taking seriously what is being said.
Lord Warner: I reject the noble Lord's last comment. On a number of occasions I have offered to take matters away and to consider amendments in regard to particular issues.
The noble Lord must have the arguments on his side. As regards the present arrangements, we have the Social Services Inspectorate, whose representatives are well trained. They have not been criticised on any lack of training or on how they carry out the inspections which will be used to form the basis of the future CSCI ratings. There will be transfers of staff there.
The Commission for Health Improvement undertakes the star rating system, based to a great extent on information provided by NHS trusts themselves. That work is undertaken by well trained and knowledgeable staff who will be transferring to CHAI. It will then be for Sir Ian Kennedy and his colleagues to decide, as an independent body—noble Lords have made great play of its independent status—what further training may be required. It is not for the Secretary of State to lay down the skills and competencies required by this independent body.
Baroness Barker: May I ask the Minister to give his response to Amendment No. 284?
Lord Warner: Amendment No. 284 seeks to specify those groups that CHAI must consult in determining criteria for determining the award of performance ratings. I certainly do not agree that we need to specify which groups, if any, CHAI, as an independent body, may wish to consult in developing its performance rating methodology. Clearly, CHAI will wish to engage patient representatives and those experts, clinical or otherwise, that it feels will be appropriate in developing such review criteria, but we do not think it would be proper for us to place in the Bill a duty on it to do so.
Again, I come back to the point that noble Lords cannot have it all ways. If an independent body is being set up and people are concerned about its independence, it is right and proper that that body
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should be given a degree of freedom of manoeuvre in how it consults. We must trust it to do that in a sensible way.
Earl Howe: This has been a useful debate and I hope that the Minister will want to reflect on the concerns expressed by my noble friends Lady Cumberlege, Lady Carnegy and Lord Peyton, as well as the noble Baroness, Lady Barker, and, from the Minister's own Benches, by the noble Lord, Lord Turnberg.
I agree with the noble Lord, Lord Hunt, that there are variations in the performance of NHS bodies and that those variations do need to be identified, and I agree with the Minister in what he had to say in that regard. I have no difficulty with the concept of performance indicators; it is the star rating system which is too much of a blunt instrument. What I sought to suggest in Amendment No. 282A—to which I am not sure whether I said I was speaking, although I hope the Committee will realise that I was doing so— is that performance ratings should be formulated by CHAI itself in a more sophisticated way than is the case at the moment, and that perhaps a linguistic form of rating would achieve the kind of sensitivity described by the noble Lord, Lord Turnberg.
I agree with the noble Lord, Lord Hunt, that we want to motivate staff, but you simply will not do that if those members of staff have no confidence in the way that their star rating was arrived at. The trouble is that the targets on which star ratings depend are, in many cases, artificial. I mentioned targets for out-patient appointments and cancelled operations. Another is waiting times in A&E, because the performance is assessed on the basis of a snapshot in a particular week. In-patient waiting times targets take no account of clinical urgency and so are unrelated to what really matters. A huge management effort is put into chasing such targets and that effort could, I believe, be better used.
My noble friend Lady Carnegy said that star ratings could learn some lessons from car ratings, and I think she has a point. By no means do I want to sweep the whole system away, but it does need to be refined and I hope very much that Sir Ian Kennedy will be allowed complete freedom to devise systems in which everyone has confidence and which really do indicate the variations that exist in the health service. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 282A not moved.]
Lord Grocott: I beg to move that the House do now resume for the Statement.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
3.47 p.m.
The Lord President of the Council (Baroness Amos):
My Lords, with the leave of the House, I should like to repeat a Statement made in another place by my right honourable friend the Foreign Secretary. The Statement is as follows:
"I should like to make a Statement about the European Council which the Prime Minister and I attended in Brussels on 16th and 17th October. I saw the Prime Minister earlier this afternoon and am pleased to be able to report that he is fine and has totally recovered.
"EU Heads of State and Government had their first substantive discussion of the draft constitutional treaty, focusing on the size of the Commission, the role of the Chair of the European Council, changes in the rotating presidency and the weighting of votes after enlargement. The Prime Minister set out the United Kingdom's position in the terms of our White Paper published on 9th September.
"The Council discussed the European economy and agreed a number of measures to encourage growth. I have placed a copy of the conclusions in the Library. These stress the EU's commitment to structural reform, flexibility of capital and labour markets, and innovation and investment in research and development.
"But between now and the Spring Council on European Reform work needs to begin to reform European competition policy, to make the new system of regulatory assessment work effectively, and to take forward the ideas of the recent report by a leading Belgian economist, Professor André Sapir, on how the EU budget can be focused on economic reform priorities. The reform agenda remains a high priority for the Government. We are working closely with the Irish Government who, as EU Presidency, will chair the economic summit in the spring.
"The European Council discussed defence at a Heads of State and Government dinner. The EU has mounted two ESDP military operations this year, both of them with UK contributions. In March, an EU-led military mission took over from NATO in the stabilisation role in Macedonia. And in June the EU deployed troops to the DRC to support UN activities there. Both operations followed the approach agreed by the Prime Minister and President Chirac in launching the European Security and Defence Policy initiative at St Malo in 1998, that the EU will act militarily only,
"where the Alliance as a whole is not engaged".
"In Macedonia, NATO has decided to terminate its mission and to support an EU successor force through the Berlin Plus arrangements. In the case of the DRC, the EU decided to deploy a force after consultation with NATO and once it was clear that NATO did not intend to engage militarily in the Congo.
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"It makes sense for EU nations to strengthen Europe's contribution to the alliance and to enable Europe to act in circumstances where NATO does not want to. What would not however make sense and is unacceptable to us would be for the EU unrealistically to aspire to provide a territorial defence commitment. That remains for NATO. Three years ago in Nice, the European Council recognised that, in approving the permanent arrangements for ESDP,
"NATO remains the basis of the collective defence of its members".
"The Government believe in a strong Europe and a strong NATO. Our leading role in European security and defence policy has been based on these twin commitments. They are widely shared across the enlarging European Union and the Atlantic alliance. They will be at the heart of the development of European security and defence policy in the Intergovernmental Conference and beyond.
"Let me now turn to Iraq. The European Council welcomed the unanimous adoption of UN Security Council Resolution 1511 on Iraq on 16th October. Its successful passage by 15 votes to nil reflects weeks of intensive negotiations and is also a testament to the tireless work of the US Secretary of State, Colin Powell.
"The resolution sets a deadline of 15th December by which the Iraqi interim governing council should provide a timeline and programme leading to an Iraqi constitution and democratic elections. We want to give control of Iraq back to its people as soon as possible and practicable. Iraqi Ministers are already heavily involved in much of the day-to-day business of the country.
"The resolution confirms the central role of the UN and encourages UN member states and international bodies to support the reconstruction of Iraq. The next step will be the Madrid donors' conference at the end of this week. There the UK will pledge a further £300 million assistance over two years. Together with money already committed this will bring the UK assistance for the three years from April 2003 to £550 million. This is on top of the contribution we are making through our commitment of British troops.
"The security situation, especially in the Baghdad area, is not satisfactory. But since Saddam Hussein's downfall the coalition has made huge efforts to rebuild the infrastructure of Iraq. Power generation is now exceeding pre-war averages. Last week, oil production reached 2 million barrels per day for the first time since military operations ceased. Nearly all schools and hospitals are open. Iraq has a new currency. Banks have reopened and businesses are coming to life. Security sector reform remains a key focus for the coalition. The challenge is to put Iraqis in charge. Iraq now has 40,000 police, and this number will rise to 70,000 within a year. The first battalions of the new Iraqi army have graduated. Training for additional Iraqi military continues and there is now an independent judiciary. The Prime Minister asked particularly that I emphasise his

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personal tribute to the UK servicemen and women, other UK personnel and other coalition partners who are working selflessly in difficult and dangerous circumstances for the good of the Iraqi people. Much still needs to be done. But much is being achieved.
"The European Council also discussed Iran and again urged the Iranian Government to co-operate fully with the International Atomic Energy Agency. Resolving the doubts surrounding Iran's nuclear programme is of grave concern to the EU and to the wider international community. Immediately after this Statement, I will be travelling to Tehran to join my French and German colleagues for talks on the issue at the invitation of the Iranian Government. We will be pressing on the Iranians the urgent need for compliance with all of the requirements of the resolution passed last month by the board of governors of the International Atomic Energy Agency. That means we shall be seeking full co-operation and transparency to enable the agency to resolve outstanding questions and pressing the Iranians on key issues raised by the resolution. These include the early signature, ratification and implementation of an additional protocol to Iran's existing safeguards agreement and the suspension of all enrichment and reprocessing activities.
"The European Council considered the worsening situation in the Middle East, condemning the intensification of suicide attacks and other violence, in particular the attack that killed three US citizens in the Gaza Strip on 15th October. The European Union called again on the Palestinian Authority to do all it could to fight against extremist violence. It also expressed particular concern over the route of the so-called "security fence". Apart from the humanitarian and economic hardship this is already bringing to many Palestinians, this project could make the two state solution impossible to implement.
"We shall work hard to achieve a successful outcome of the Intergovernmental Conference under the Italian presidency this year. We are very grateful to the leadership of the Italian Government in this negotiation.
"The draft constitutional treaty is designed to improve the way the European Union works after enlargement by reform, clarification and consolidation. The claims made by the Opposition and others that this treaty would undermine Britain's independence are absurd. These are, in truth, arguments not against the draft treaty but against British membership of the European Union. Their logic would be to take Britain out of the European Union altogether.
"The European constitutional treaty has got to be one based on independent sovereign nation states co-operating together, not some federal superstate—and so it will be. A constitutional treaty embodying these principles will contribute to a strong and successful European Union. That is essential for our economic prosperity, our security
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and for Europe's stability. We believe that this patriotic approach is in the interests of this country and I recommend this approach to the House".
My Lords, that concludes the Statement.
3.57 p.m.
Lord Howell of Guildford: My Lords, I thank the noble Baroness for repeating the Statement. The House, of course, will be united in wishing the Prime Minister a rapid return to complete full health. I am very happy to hear that that is indeed the situation. I combine what I suspect are your Lordships' feelings with friendly advice, such as that offered with amazing prescience last week by my noble friend Lord Hurd in a newspaper article: that in future it probably will be wise for the Prime Minister to go a little slower in his activities, carrying, as he does, enormous burdens.
We applaud some aspects of the Council's conclusions, such as its robust views on addressing the unending Palestine tragedy; the combined approach to the Iranian nuclear programme, which the noble Baroness described; and the latest UN resolution on Iraq, which is welcome.
Despite the desperate security situation in some parts of Iraq—which our troops are handling with their customary skill and superb qualities and bravery—I agree that clearly there has been progress. However, not many of the advances—for example, the fact that oil production is now back to 2 million barrels per day; the currency reform; the new investment and so on—get reported. We welcome the progress that has been made and hope that the donors' conference in Madrid next weekend will be successful. We acknowledge that the £550 million already committed by the United Kingdom is a good start, as is the 1.5 billion US dollars now committed by Japan and a number of other commitments. It is a start and a move in the right direction.
However, we are far less impressed by the communiqué and the Statement, which contain endless paragraphs and presidential conclusions full of tired "Oldspeak" references to "relaunching Europe", "growth initiatives", government plans for somehow magically producing jobs, and even to that old chestnut "industrial policy". I thought we had seen the last of that kind of thing. The drafters of the communiqués and conclusions do not seem to realise what the public long ago grasped—that nowadays the most effective and innovative economic and social change comes not from more central government plans and initiatives but from outside central government. It comes from market competition and deregulation; in the social case, it comes from non-governmental organisations, from the private sector, from voluntary groups and even from the media.
It is a pity, too, that the summiteers did not pay more attention to the robust rubbishing given to all this kind of thinking by the Chancellor of the Exchequer, Mr Gordon Brown. He said in last Thursday's Wall Street Journal,
"the policies of trade bloc Europe are not just out of date but counterproductive".

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He added that Europe,
"must conclusively rule out tax harmonisation"
and,
"resolve that tax competition is the basis on which Europe can compete".
I presume that can only mean that he would like to see lower taxes. Of course, he does not practise what he preaches in that respect, but that is a debate for another time. But at least he is speaking along the right lines.
We are, frankly, left mystified by the twists and turns of government policy on defence and security, although the noble Baroness sought, in the Statement, to explain the position. What exactly have we agreed to? Last week, the US Ambassador to NATO, Nicholas Burns, described the EU plans as,
"one of the greatest dangers to the trans-atlantic relationship".
The Americans—and my friends confirm this—tell me they believe they are being kept in the dark. We need some more illumination about what is happening. Are we falling in with the increasingly explicit French and German plans, just confirmed in the German Ministry document, for a European army with its own command structure, or are we not? The Prime Minister, of course, assured President Bush a few weeks back that there would be a joint command between EU forces and NATO. Is that still the policy or have we shifted? How does that fit in with Monsieur de Villepin's recent lecture to us about,
"expanding German and French ambitions"
to use his slightly chilling phrase.
Thirdly, we come to the constitution plans, which the noble Baroness mentioned. What do the Government say to the Italian Government's proposal to table a "take it or leave it" document on the constitution next month? Have we been consulted on this procedure, or will we just be caught by surprise again, as often seems to happen?
As for the nature of the draft constitution, how can Ministers say with a straight face that the constitution will not fundamentally change the European Union or our relations with the rest of the Union, when it places the new constitution above our own, when most of Europe's leaders describe it as an absolutely major constitutional change—amended or not—and when at least six other countries are having referendums on it? Is it any wonder that the Prime Minister's closest advisers are now said to be cautioning that the Government's dogmatic rejection of a referendum here is an untenable position?
Constitutions are supposed to be about checks and balances to prevent too much central power and the tyranny of the majority. Are we going to inject any of our national experience on these matters into the draft, which is at present devoid of all such considerations? If so, when are we going to speak up?
Finally, this country used to be seen in central and eastern Europe—I am referring to the enlargement development—as the champion of the smaller states. Did we, this past weekend, stick up for them and their deep worries about not having commissioners in
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Brussels, about a centralising presidency or about anti-Americanism in Paris and Berlin? Or did we just side with the big powers against the small? It would be nice to think that our country was on the side of democracy and a more equal kind of Europe—in fact, a better Europe. But in the presidency conclusions, and in today's Statement, there is no sign of that at all, and I wonder why.
4.4 p.m.
Lord Wallace of Saltaire: My Lords, we on these Benches also extend our best wishes to the Prime Minister after the unfortunate incident yesterday and hope that he will be fully recovered.
We welcome the Statement. I note that the conclusions had a good deal more on the Lisbon agenda and the growth initiative than is provided in the Statement. If I may make a marginal correction to the Statement, the recent report of the Sapir group was by not only leading Belgian economists but a multinational group of experts, including a British expert, Professor Helen Wallace, whom I know moderately well.
The growth initiative talks about trans-European networks and their funding. The Belgian, Luxembourg and French Governments were particularly concerned that these should be in the centre of Europe. Could the Government assure us that they are pushing hard for funding for transport initiatives to be in the peripheral areas where possible, particularly in the new states, and not across the Alps and between Brussels and Strasbourg, as has been suggested?
Can the Minister tell us a little more about what is planned on the research expenditure of a major element of European knowledge in the Lisbon agenda? May I ask, for future reference but not now, that, at some point in the near future, the Government will come to the House and tell us what is happening among higher education institutions in what is known as the Bologna process? I note that communiqués from Ministers of higher education, all part of the Lisbon agenda, have not, to my knowledge, yet been reported in any way to this House.
I am happy that the better regulation initiative is being extended from Britain to the European level, and I hope the Government are pushing that very thoroughly.
There is very little mention of the border management issues, as covered in the presidency conclusions. They make a reference to a border management agency, with maritime and air components. Do Her Majesty's Government intend to take part in that, particularly given that the presidency conclusions say that the outline of this border management agency is due to be agreed in principle before December's European Council?
Much of the Statement covers defence. We welcome the Government's insistence on a European pillar in NATO, but are puzzled by the extent to which Her Majesty's Government appear to have been giving incoherent messages to their different partners over the past few weeks.

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We were strongly in favour of the St Malo initiative of 1998, and I am glad to see that the Government are back on track. Some of us remember that 40 years ago or more, John F. Kennedy talked about a European pillar within NATO, and it seems to us that that is the direction in which we should be moving. There has always been deep American ambivalence about what that European pillar should be. Yet again, each time the Europeans move in that direction, Americans question whether we will be as loyal as we should be.
We are puzzled by the depth of the Government's opposition to the inclusion of a territorial defence commitment in the constitutional treaty. We lived fairly happily with the Western European Union treaty and its strong territorial defence commitment among European states for many years. It is inconceivable that there should be an attack on any member of the European Union without all members of the European Union, whether in NATO or not, being engaged. Perhaps we are being over-loyal and theologically purist about NATO in resisting that.
We welcome the emergence of EU forces in eastern Congo and Macedonia. I know that there have been some discussions about the use of peacekeeping forces in Moldova and whether the force in Bosnia will transfer from NATO to the EU.
Finally, there is a certain amount in the Statement on the constitutional treaty. We on these Benches welcome progress towards the constitutional treaty; we do not intend to discuss it in depth here, beyond hoping that the Standing Committee, which will be meeting at 5 o'clock, will attract a large attendance from your Lordships' House. We welcome the fact that the Foreign Secretary will be there. Discussions should be actively pursued over the next few weeks and months in that forum.
4.10 p.m.
Baroness Amos: My Lords, first I thank both noble Lords for their comments about the Prime Minister. He has now recovered. However, I have to say to the noble Lord, Lord Howell, that it would be a very brave person indeed who advised my right honourable friend the Prime Minister to go a little slower. Perhaps I shall send him a copy of Hansard rather than raise the matter with him myself.
The noble Lord, Lord Howell, asked specifically about tax. Our position remains as set out in the White Paper, which was published by my right honourable friend the Foreign Secretary in September. Paragraph 66, on page 32, makes it absolutely clear that,
"we will insist that unanimity remain for Treaty change; and in other key areas of vital national interest such as tax, social security … key areas of criminal procedural law",
and so on. Our position remains exactly as set out in the White Paper.

Both noble Lords asked me a number of questions in relation to defence. After the Brussels summit, our position on European defence is the same as it was before. I should like to quote the Prime Minister in Brussels on Friday, when he said:
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"We need of course strong European defence, but nothing whatever must put at risk our essential defence guarantees within NATO".
That remains the position.
In response to a question asked by the noble Lord, Lord Wallace of Saltaire, we have said that collective or territorial defence is for NATO, and that remains our strong position. We see European defence being on a basis fully compatible with the NATO agreement. In our view, European defence has no future as a competitor to NATO.
In relation to the constitutional questions, particularly the question of a referendum, let me repeat what has already been said in this House. Under our constitutional arrangements, Parliament makes the law. In certain circumstances, Parliament has decided that particular laws should come into operation only after a referendum has been held. In practice, they have been held only where there is a wholly new constitutional structure proposed, and not otherwise. Referendums have been held in Scotland, Wales and Northern Ireland, so that the people there could decide whether they wanted a parliament or assembly. Only one UK-wide referendum has ever been held—in 1975, when the question was whether the UK should stay in or withdraw from the European Union. The Government are committed to holding a referendum on the euro. The position on referendums remains the same. A number of European countries have come to a different decision, but that is in line with their own constitutional arrangements.

The noble Lord, Lord Wallace of Saltaire, asked specific questions about funding for transport arrangements and research expenditure on higher education institutions. I hope that the noble Lord will allow me to write to him on those points. I shall put a copy of the letter in the Library of the House.
The answer that I have on Moldova does not answer the noble Lord's point. My brief states that the European Union reiterates its continued support for the OFC efforts for a comprehensive political settlement in Moldova, but it does not go to the heart of the points that the noble Lord raised. If I can find further information about that, I will be happy to write to the noble Lord. I should add that my right honourable friend the Foreign Secretary will unfortunately not be attending today's Standing Committee, as he will be on his way to Teheran, but he will try to attend all other sittings.
4.14 p.m.
Lord Tomlinson: My Lords, is my noble friend aware that, while I welcome the Statement that she has repeated, the Statement is vastly preferable to the presidency conclusions, which we have had more chance to read? Does she accept that many Members of this House, having read the presidency conclusions, will agree with the extremely critical comments made by the noble Lord, Lord Howell? In future, perhaps they should wait until after a Council meeting before writing presidency conclusions. Occasionally, instead

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of continuing to repeat the promises of the past, they should give an evaluation of how far they have gone in achieving some of those things.
I should like to ask a specific question arising from the presidency conclusions, under the heading "Iraq". Paragraph 63 refers to the conference to be held on 24th October in Madrid and how the European Union "will announce a pledge" of 200 million euros. Does my noble friend agree that that represents a somewhat obscure sense of priorities, when one contrasts that paltry figure with the 1 billion euros that is the annual subsidy in the European budget for tobacco manufacturing?
Baroness Amos: My Lords, my noble friend's proposal that we wait to write presidency conclusions until after the meeting is a somewhat novel one. It would have our officials and others in the international community somewhat concerned, but I shall pass it on.
With respect to the issue of Iraq and the 200 million euros that will be pledged by the EU later this week, individual European member states will also be pledging in relation to that. The decision was taken by the Commission on behalf of European Union countries.
Lord Hannay of Chiswick: My Lords, I thank the noble Baroness for the Statement from another place that she has repeated. On the defence issues that she raised, will she confirm that the relationship between the European Union and NATO continues to be based on an agreement reached last December, known as the Berlin Plus agreement? Will she also confirm that nothing that has been said or proposed within the European Union involves going outside, cutting across or undermining that agreement? In those circumstances, some of the excitement leaked to the press by the representatives of the US Administration seems a little premature, to put it mildly, and is not likely to produce the best reaction from the European side.

Unlike the noble Lord, Lord Wallace of Saltaire, I entirely support the view that territorial defence should not be included in the treaty. This country has never given a territorial guarantee to anyone who is not a member of NATO. The arrangements under the Western European Union were limited to countries that were also members of NATO. To go outside that would be a big innovation, and one that I would not welcome. If one considers the implications of giving a territorial guarantee to Cyprus, for example, one immediately understands why it is not a wise course.
Will the noble Baroness confirm, on the size of the Commission, that the most important issue is the number of portfolios rather than the number of members of the Commission? If the number of members is to meet the concerns of smaller member states and is going to start on a rising trend again— which I, personally, would deplore—it is crucial that the Commission is not subdivided into little penny
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packages of portfolios so that members are quite unable to represent the views of the European Union when it is their responsibility to do so.
Baroness Amos: My Lords, I totally agree with the noble Lord, Lord Hannay. Berlin Plus remains the agreement governing the EU/NATO strategic partnership and is at the core of the EU/NATO relationship.
I agree with the noble Lord, too, on territorial defence. I repeat that the Government's view is that collective or territorial defence is for NATO.
The issue of the size of the Commission is still under discussion as part of the process. 1 take the noble Lord's point about the number of portfolios. One issue for which we argued strongly in the context of the IGC was the placing of development in the Commission. Those discussions will continue.
Lord Waddington: My Lords, can the noble Baroness the Leader of the House help me? Why do the Government continue to say that the logic of those who say that the draft treaty would undermine our independence involves taking Britain out of the EU? Is that not entirely illogical because the new constitution cannot come into effect without the agreement of all? If we object, the constitution will not come into effect but the EU will continue, as will our membership. So it is absolute rubbish to talk about the logic being that we shall leave the EU if we object to the constitution or any part of it.
Baroness Amos: My Lords, I do not agree with the noble Lord. One of the reasons that these new constitutional arrangements are coming into effect is because the EU is expanding to some 25 members so there is a process of simplifying and pulling together the rules of the European Union to make it easier for 25 members to operate in a situation where currently only 15 operate. One of the reasons it is so important that that is done by unanimity is to ensure that those issues that are important for individual member states are kept outside these proposals so that they are contained within the treaty arrangements that already exist.
Lord Maclennan of Rogart: My Lords, will the noble Baroness robustly reject any implication that the convention produced a constitution which favoured large nations over small nations, and note that the Spanish Government, who have raised some objections, recently said that the Nice settlement was not cast in stone? Will she note also that a number of small member states, or states to be members after May, have, subsequent to the publication of the draft treaty, held referenda which massively supported adhesion to the European Union in the full knowledge of the terms of the draft treaty? Will she also accept that reduction in the size of the Commission is no more against the interests of small countries than it is against the interests of large countries? It enhances the

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efficiency and, indeed, the accountability of that executive body which in any event is supposed to be independent of national representation.
Baroness Amos: My Lords, the noble Lord is quite right that the convention process seeks to ensure that those countries that will join the Union next year as well as existing members of the Union are able collectively to discuss these issues. Part of its purpose is to ensure that small and large nations can make decisions on the future shape of the European Union. I entirely agree with the noble Lord that the effectiveness, efficiency and accountability of the Commission are very important indeed. That is one of the reasons that we feel strongly that this exercise of seeking to simplify and make more straightforward the various treaties of the Union is so important.
Lord Stoddart of Swindon: My Lords—
Lord Campbell of Alloway:: My Lords—
Baroness Crawley: My Lords, we have plenty of time. I suggest that we hear the noble Lord, Lord Stoddart, and then other noble Lords.
Lord Stoddart of Swindon: My Lords, first, I remind the noble Baroness the Leader of the House that in 1975 the country voted to remain in a common market. The European Union did not come into being until after the Maastricht Treaty had been signed. That is an important point. Secondly, will the noble Baroness confirm whether under the defence arrangements there will be a European army which will support a European foreign policy? I hope that she can clear that up. Thirdly, can the noble Baroness say why the Government have now agreed to a number of items which they would not agree to, or said were not relevant, following the Treaty of Nice? I refer to the semi-permanent president of Europe, the European Charter of Fundamental Rights—which they assured us would not be contained within any treaty and which is now to be contained in the new treaty—a legal personality, which we were assured would not be agreed to, and a European Union foreign minister. The latter will obviously be a powerful post which will give membership not only of the Council but also of the Commission, making that position extremely powerful, and probably greater than that of any of the Prime Minister.
Baroness Amos: My Lords, on the question of the charter, we support a clear statement of the rights, freedoms and principles that EU institutions should respect. The noble Lord is quite right that we supported the European Charter of Fundamental Rights at Nice three years ago but we did so as a political declaration; it was not clear enough for legal use. We shall make a final decision on incorporation of the charter into the draft constitutional treaty only in the light of the overall picture at the IGC. Therefore, that decision has not been taken with respect to incorporation.
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With regard to defence, we consider that the discussions on ESDP were extremely valuable. We welcome the proposals to develop a capabilities agency to update the Petersberg tasks and to create a solidarity clause. With respect to all of the ESDP proposals, those matters are still under discussion. The noble Lord will be aware that, for example, the force that went into the DRC was a French-led force with other European countries contributing to that force. There was no European standing army as such.
Lord Campbell of Alloway: My Lords, this side, I think. Thank you.
Does the noble Baroness agree that one of the priorities in considering this draft constitution is to deal with the ritual plunder of the financial resources of the EU, as it is, and to get to the root of these fraudulent practices which have been going on and on? If the noble Baroness agrees with me, was that discussed and, if so, what was said about it?
Baroness Amos: My Lords, I am not aware of that particular issue having been discussed over the weekend. However, the noble Lord will be aware that for many years there has been a reform agenda within the Commission not only looking at issues of financial probity but also seeking to improve the overall effectiveness and efficiency of the Commission.
Noble Lords: This side!
Lord Lea of Crondall: My Lords, as regards counting sides, the noble Lord, Lord Stoddart, for whom I have great respect, is not now on our side. But be that as it may, the noble Lord, Lord Stoddart, referred to the referendum of 1975. It was the only referendum on Europe that we have had but it was not about the European Union. We should have had a referendum on the European Union that came into being after the signing of the Maastricht Treaty. Were not the party opposite in power at the time of the Maastricht Treaty? Therefore, is it not a bit much for them to get on their moral high horse and say that it is absolutely essential to have a referendum now?
Would it not be much better if noble Lords on all sides of the House were clear on the Government's main negotiating lines in the intergovernmental conference? I have not heard any of them being unpicked. However, we do not hear from all sides of the House that this country is united behind a great deal of the Government's negotiating position on the intergovernmental conference which we want to see succeed, not least because of the need to make provision for enlargement.
Baroness Amos: My Lords, my noble friend is quite right. The single European Act and Maastricht involved changes in the operation of the EU greater than any likely to flow from the IGC. We need to repeat that point, so that people understand the processes. He is right that we need to ensure that the realities of such changes are understood.
Lord Pearson of Rannoch: My Lords, when the Government say that claims by the Opposition and others that the treaty would undermine Britain's independence are absurd, surely it is that statement that is absurd. In the Giscard proposals, we are looking at a new and superior legal personality that means that national parliaments will be able to make laws in virtually every area of our national life only when Brussels cannot be bothered. That is what the exclusive and shared competence is saying, is it not?
The noble Baroness refuses yet again to give the British people a referendum on whatever constitution emerges from the IGC. I think that she said that under our constitution Parliament makes the law. Does she agree that the real position is that the British people have given Parliament—the House of Commons and this place—the power to make their laws and to take their decisions for them, except the power to give that power away?
Baroness Amos: My Lords, the noble Lord may wish to look historically at the situation regarding international and national law. It is an established principle of international law that a state may not plead its national law to escape its international law obligations, including its treaty obligations. The UK has given effect to the principle of the primacy of Community law through the European Communities Act 1972. That is not recent and not new.
Lord Grenfell: My Lords, the Statement that the noble Baroness was kind enough to repeat to us stated that the Government would work hard to achieve a successful outcome of the inter-governmental conference under the Italian presidency this year. That reflects the wording in the presidency conclusions, where the Council,
"recalled its support for the approach and timetable put forward by the Presidency in line with the conclusions of the European Council meeting in Thessaloniki".
In light of the facts that there are probably less than 10 weeks to go, that the Italian presidency appears to be quite relaxed at the prospect of the treaty being signed some time in the new year—at least before April 2004, which is the absolute deadline—and that the Italian Government do not seem too concerned about the treaty being signed in Rome during their presidency, will the noble Baroness assure us that, in the IGC, Her Majesty's Government will be on the side of the angels and opt for getting it right rather than done early?
Baroness Amos: My Lords, the noble Lord is right that it is anticipated that we will conclude at the end of this year. However, I assure him that we want to get everything right. The IGC should complete its work and agree the constitutional treaty, to allow it to be signed by the member states of the enlarged Union as soon as possible after 1st May 2004 and in time for the June 2004 elections for the European Parliament.

Health and Social Care (Community Health and Standards) Bill
4.34 p.m.
House again in Committee on Clause 49.
Baroness Noakes Baroness Noakes moved Amendment No. 283:
Page 17, line 38, leave out subsection (2).
The noble Baroness said: I shall speak also to the other amendments in the group tabled in my name and that of my noble friend Lord Howe. The amendments concern the setting of criteria for use in reviews or investigations by CHAI and CSCI.
Amendment No. 283 deals with Clause 49 and deletes subsection (2) on a probing basis. The amendment has two distinct purposes. The first is to challenge yet again the involvement of the Secretary of State for Health, this time in the approval of criteria devised by CHAI. Under Clause 45, the Secretary of State will be setting standards against which CHAI will have to evaluate NHS bodies and award a performance rating. My noble friend Lord Howe has already explained to the Committee our profound misgivings about that. But why does the Secretary of State also have to approve the criteria that CHAI will use? Can CHAI not be trusted to do anything without the Secretary of State? That is the substantive challenge of the amendment.
My second purpose is to probe the meaning of criteria and the arrangements for devising and publishing criteria. Will the Minister explain what criteria actually are? Are they any different from targets? In what way will the new arrangements make a difference to an NHS which has been overburdened by targets, as my noble friend has said? I am sceptical about words such as criteria. They are elastic and can have many meanings. My dictionary says that criterion means a,
"principle or standard by which something can be judged".
However, it is clear that criteria are not standards, because they are dealt with elsewhere in the Bill. So what are they? I hope that the Minister can explain.
Amendments Nos. 313, 314 and 315 are directed at Clause 59. Amendment No. 314 puts a small word— "not"—into Clause 59(4) so that the regulations may not require CHAI to get the approval of the Secretary of State or the Assembly for criteria that it will set under Clause 59. There is no good reason for the Secretary of State to consent to criteria under Clause 59, just as there was no good reason for him to approve them under Clause 49, as I have just said. Indeed, I challenge the Minister to give one good reason why the Secretary of State should have those powers.
Amendment No. 313 is a simple requirement for CHAI to consult on the content of any statement of criteria. It does not specify the consultees—it leaves that to CHAI—but it requires consultation. We think it important that the NHS move from the command-and-control era of the Government to one where consultation is the order of the day. Amendment No. 313 is therefore a symbol of that important change.
Amendment No. 315 requires the affirmative procedure to be used for any regulations under Clause 59. That clause gives significant power to the Secretary of State to tell CHAI what to do. If we allow that impaired independence to remain in the Bill, it is right and proper for Parliament to approve the regulations that are made.
I have directed my comments at CHAI. Amendments Nos. 342, 355 and 356 attack the same issues for CSCI, which is similarly subject to excessive Secretary of State involvement. I beg to move.
Baroness Barker: I shall briefly speak to the amendments in the group to which our names are attached. In doing so I wish to echo, but not to repeat at great length, the arguments put forward so ably by the noble Baroness.
We have argued throughout our consideration of the Bill that the functions of CHAI and CSCI are the output of a health and social care system that can achieve what it is supposed to do, in preventive, rehabilitative and acute terms, only if it is widely understood and supported by health and social care agencies in their broadest sense, and not only in the narrow sense. Therefore we also think that others than the Secretary of State should be taking part in the direction of that. I do not see why he or she should have the ultimate approval of these bodies, which will be so important in the provision of strategic information and data. I support the noble Baroness, Lady Noakes, in her amendments.
Lord Warner: I shall try to help the noble Baroness, Lady Barker, by saying at the outset that we regard criteria as means of measuring standards. My comments will be in that context.
The two commissions themselves will be fully responsible for drawing up the inspection methodologies and criteria, as is right and proper for such independent organisations. However, we want to ensure that the criteria against which the NHS and local authorities are being assessed are consistent with the national standards set by the Secretary of State so that they are fair to the bodies that are being inspected and so that there is no confusion.
We have had several discussions about standards, and I have tried to explain on several occasions why we believe that it is for the Secretary of State to set national standards under Clause 49.I shall not repeat those arguments. Effectively, Amendment No. 283 would prevent the outcome that I have suggested we are trying to achieve; that is, to ensure that having done much work on the criteria, the Secretary of State can satisfy himself that the criteria are consistent with measuring the standards that rightly he will have produced. It is probably worth repeating that which has been said on several occasions. On both the issue of the Secretary of State producing national standards and producing draft criteria by CHAI and CSCI, there will be a consultation process in which draft criteria—
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draft standards—are put in the public arena for a process of widespread consultation with a whole variety of particular interests.
There will be no question of that being done in a hole in the corner manner. The proper order for that to be done is for the Secretary of State to make the standards clear, and it will be difficult for CHAI to produce criteria without knowing the national standards. CHAI will produce criteria for measuring them in that context of draft national standards. That is its primary responsibility. All that the Secretary of State will do is ensure that we do not have confusion by having criteria agreed with the best of intentions, but which are nevertheless not compatible with the measurement of the particular national standards that are agreed and settled by the Secretary of State.
If Amendment No. 311 were carried, it would not be possible to require CHAI to publish statements of the criteria it will use. That could lead to a lack of transparency in the way in which CHAI exercises its functions.
Amendment No. 314 seeks to remove the Secretary of State's power to make regulations requiring CHAI to obtain the consent of the Secretary of State to the criteria it has devised. For the reasons that I have described, we cannot expect the NHS effectively to serve two masters—a set of standards determined by the Secretary of State and a set of criteria which are not compatible with them, and which are agreed by CHAI. We do not expect there to be difficulties in agreeing those criteria, but it is important that we do not cause confusion. Given the importance that patients, the public and the NHS will attach to CHAI's verdicts, satisfying ourselves that CHAI's criteria will be consistent with national standards is important for managers, clinicians and the public.
I agree with the sentiment behind Amendment No. 313. I have said that I have no doubt that CHAI will want to use its expertise to make sure that the criteria it uses in its review and inspection of NHS bodies will be fair and reflective of the needs of patients, and the realities of the world within which healthcare providers operate. We are tabling our own Amendments Nos. 314A and 354A in relation to this clause and the equivalent CSCI clause, enabling regulations to provide for CHAI and CSCI to be obliged to consult specified persons. We think that by requiring CHAI to consult prescribed persons in relation to regulations issued by the Secretary of State or the Assembly, Amendments Nos. 314A and 354A are more complete and I hope that noble Lords will support them.
Amendment No. 315 would place a duty on the Secretary of State to consult such persons as he considers appropriate as well as CHAI before making regulations requiring CHAI to devise and publish statements of criteria to be used in the exercise of specified functions. I am sure that my right honourable friend the Secretary of State will be considering whether and to what extent it would be appropriate for him to consult persons other than CHAI before making any regulations under this clause. In my view,

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it is unnecessary to amend this clause in order to require him to consult, and that would be out of line with the wording of most of the other powers to make secondary legislation in Part 2.I hope that noble Lords will not press Amendments Nos. 312 and 313 in place of those that I have tabled.
Amendments Nos. 315 and 356 seek to ensure that no regulations may be made under Clauses 59 and 83 unless a draft of the regulations has been laid before Parliament and approved by a resolution of each House. Clause 191(4) stipulates that:
"Any power to make … regulations under this Act is exercisable by statutory instrument".
Subsection (5) states that the regulations are,
"subject to annulment in pursuance of a resolution of either House of Parliament".
That has been normal practice in relation to the regulation-making powers in other legislation covering the regulation of health and social care services. So we have continued as in the past. We are not sure that a further amendment along the lines proposed is necessary.
4.45 p.m.
Baroness Carnegy of Lour: Regarding the question of whether the regulation should be by annulment or by affirmative resolution, the Minister said that previously the regulations involved negative resolution. Will there be much greater powers in the proposed regulations than existed before? The Delegated Powers and Regulatory Reform Committee looked rather cursorily at that point, and took the point that the Minister made. However, if the new powers are much greater, there may be an argument for my noble friend's suggestion. What is the difference between the powers of the previous body— I cannot remember its name; was it called the CHI?— and those of CHAI?
Lord Warner: The point that the Delegated Powers and Regulatory Reform Committee was making was in other areas, where there has been a widening of scope, we should move from negative to positive. Regarding this matter, my understand of what the committee was saying was that the arguments that I have outlined were largely valid; that there was not such a significant difference in the scope of the powers that it would justify moving from negative to affirmative resolution. That was the only point that I was trying to make.
Baroness Carnegy of Lour: From memory, I do not think that the committee—of which I am a member— looked at the difference between the powers. Would the Minister indicate whether the difference is significant? That was my point.
Lord Warner: My judgment is that they are not so significantly different that we would want to move from negative to positive. In other parts of the Bill that we shall discuss, we will acknowledge the force of the arguments put forward by the Delegated Powers and Regulatory Reform Committee and make adjustments.
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This matter did not seem to us to be one where the range of powers that the commissions have are so significantly different that we should move from negative to positive in this regard.
Baroness Noakes: I thank the Minister for his reply and the noble Baroness, Lady Barker, for her support. My noble friend Lady Carnegy raised an important question on the extent to which the powers were different. Will the Minister reflect on his answer? I do not believe that this part of the Bill repeats powers that already exist. Perhaps we are in virgin territory. I hope that he will take the issue away and look at it again.
I thank the Minister for defining the criteria. At least we have an explanation of them on the record. I shall carefully consider it—it is helpful to have it laid out. However, there is a difference of opinion. The Minister says that the Secretary of State must set the standards and then ensure that CHAI sets the criteria in line with how the Secretary of State believes the standards should be interpreted. Really, the Secretary of State wants to set the whole lot. That is what lies behind the whole of the Bill. The Secretary of State does not trust even the bodies he is claiming are independent and have an important part in the future of the NHS, such as CHAI and CSCI. A complete lack of trust lies behind the way in which the Bill has been drafted.
We take a contrary view. We believe that these bodies should be independent and capable of being trusted to, for instance, turn standards into a means of measuring. We do not believe that the Secretary of State needs to be involved down to the final level. The proposal is indicative of the way in which the Secretary of State will not let these bodies go. There is a fundamental difference between the Government's view and the view of the Conservative Benches and that of the Liberal Democrat Benches as well.
We spoke about consultation. The Minister introduced his own Amendment No. 314A, which requires consultation with specified persons. Our Amendment No. 313 trusted CHAI and proposed that CHAI should consult on the basis of the individuals and groups it believed to be appropriate. Again, the Secretary of State is taking additional powers to tell CHAI exactly what to do. One might ultimately query how much freedom CHAI will have by the time the little regulations here and the little regulations there add up to tying CHAI and CSCI in knots.
We are not content with this part of the Bill. We will read carefully what the Minister has said, but on Report we will return to the involvement of the Secretary of State and the way in which it is manifested in different parts of the Bill. In the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 284 not moved.]
Clause 49 agreed to.
Clause 50 [Reviews: England and Wales]:
Earl Howe Earl Howe moved Amendment No. 285:
Page 18, line 13, leave out "and" and insert "or"
The noble Earl said: In moving Amendment No. 285, I shall speak also to Amendments Nos. 286 and 287. This is a probing amendment. It probably looks fairly innocuous, but its purpose is to test whether the wording in subsection (l)(a) would cover the provision of healthcare by independently run diagnostic and treatment centres.
At present, the subsection reads:
"The CHAI has the function of conducting reviews of—
(a) the overall provision of health care by and for NHS bodies".
My amendment proposes that it should read,
"by or for NHS bodies".
We know that the new fast-track diagnostic and treatment centres will be run for the NHS, but many of them will not be run by the NHS. In fact, they will be run by a range of companies from Britain, Canada, South Africa and the United States.
Already some 20 such treatment centres within the NHS are either operational or are soon to come on stream. There is no problem about the centres coming under the scrutiny of CHAI as they are providing care both by and for NHS bodies. Clearly, the privately run clinics will be in a different category. I hope that the Minister can tell me that the amendment is unnecessary, but it is not at present clear to me that it is. I beg to move.
Lord Warner: I can give the noble Earl the assurance that all types of diagnostic and treatment centres are covered. I shall spare him the note I have on the logic of "by" and "for", but I am happy to write to him if he wants Parliamentary Counsel's advice on the matter.
Earl Howe: I am happy to accept the Minister's assurance on the matter and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 286 to 287 A not moved.]
Clause 50 agreed to.
Earl Howe Earl Howe moved Amendment No. 288:
After Clause 50, insert the following new clause—
"REVIEWS FOR THE REGULATOR

(1) If the regulator so requests, the CHAI must conduct a review of, or investigation into, the provision of any healthcare by or for an NHS foundation trust.

(2) Where the CHAI conducts a review under this section it must submit its report to the regulator who shall decide whether and how the report is published."

The noble Earl said: In moving Amendment No. 288, I shall speak also to Amendments Nos. 291A and 294. These are simple amendments, but collectively they address an important point. As a general principle, I believe that CHAI ought to be free to decide what work is important for it to carry out within its own priorities. For that reason, I am inherently hostile to the provision in Clause 51 (4), which gives the Secretary of State power to insist that CHAI conducts a particular review of his choosing. The Secretary of State already has control over CHAI's purse strings.
He should not also be given the right to decide how CHAI should spend the limited money it has at its disposal.
If the Government insist that the Secretary of State should be allowed to do this, there is one area he should definitely keep his hands off; that is, foundation trusts. Requiring CHAI to carry out investigation into a foundation trust is for the regulator and not for the Secretary of State. The regulator is meant to be independent and there should not be a power for the Secretary of State to go in over the regulator's head.
By the same token, I suggest in my Amendment No. 288 that there ought to be an explicit power for the regulator to request CHAI to conduct a review or an investigation into a foundation trust and for CHAI to be obliged to do that when asked. The duty of the regulator and CHAI to co-operate does not seem to me sufficient to cater for situations where it may not suit CHAI to devote its resources at a particular time to carrying out an investigation not of its choosing, yet the regulator may perceive that the foundation trust is falling seriously short of performing its functions and want the matter looked at without delay.
At the back of my mind is the fear that with CHAI and the regulator working in parallel, we shall, if we are not careful, see an inefficient build-up of regulatory capacity. It is much better to have clarity on who does what. It should be CHAI's role to investigate and carry out reviews and the regulator's role to act on such reviews. There is a danger that the structures in the Bill will generate too much oversight and we should guard against that. I beg to move.
5 p.m.
Lord Warner: I appreciate the intention of Amendment No. 288, but I want to reassure the noble Earl that CHAI already has the function under Clauses 50 and 51. Using such powers, the commission is already empowered to conduct reviews and investigations of the provision of healthcare by and for all NHS bodies. In particular, under Clause 51(4), CHAI must conduct a review of the provision of any healthcare by or for an NHS foundation trust if the Secretary of State so requests. I know that the noble Earl takes objection to this, but subsection (2) of the new clause would place a duty on the regulator rather than on CHAI to decide whether and how any report made by CHAI in relation to foundation trusts was published.
Perhaps I may remind the noble Earl and the Committee that we are establishing CHAI as the health watchdog that the public can trust as the authoritative independent commentator on the quality of NHS healthcare. I find it strange that, having argued passionately to increase CHAI's independence, the amendment seeks to reduce it. We see no reason why the commission should be expected to submit its reports to anyone for either prior clearance or a decision on publication.
Amendments Nos. 291A and 292 would, if carried, remove the Secretary of State's specific power to require CHAI to undertake reviews and investigations

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in relation to the provision of healthcare by and for NHS bodies or to review arrangements by those bodies for the purpose of discharging their duty of quality under Clause 44.
Amendment No. 292 would replace the Secretary of State's power to require with a provision expressly empowering CHAI to carry out reviews in response to requests. Amendment No. 291A would simply remove the Secretary of State's power to require without putting anything in its place. We believe it is important that the Secretary of State, who still remains accountable to Parliament for the provision of healthcare in England, has the ability to require CHAI to inspect a specific NHS body or type of service so that issues of interest to the public or Parliament may receive appropriate scrutiny by the inspectorate.
We do not feel that being able to respond in that way impinges on CHAI's independence because, in most cases, CHAI itself will proactively initiate such work into problems that it identifies emerging from its other review work. CHAI may also choose to initiate a review or investigation as a result of information that it receives from patients, healthcare staff or the general public. That, quite rightly, will be for CHAI to determine.
We also do not feel that Amendment No. 292 would add anything useful to CHAI's general powers in the Bill. Nothing in the Bill prevents CHAI carrying out reviews in response to requests from others.
Amendment No. 294 would prevent the Secretary of State requesting that CHAI conduct a review of, or investigation into, the provision of any healthcare by or for an NHS foundation trust or reviews of the arrangements made by those trusts for the purpose of discharging their duties under Clause 44. That clause concerns the duty of quality placed on each NHS body to put and keep in place arrangements for the purpose of monitoring and improving the quality of healthcare that it provides. The duty of quality will therefore apply to foundation trusts, and it is proper for the Secretary of State—again, because of his parliamentary accountability—to be able to request CHAI to undertake such a review or investigation.
We do not believe that anything in the present Bill suggests that CHAI will in any way be dragooned by the Secretary of State into doing things that are inappropriate. However, we consider it important that, in discharging his parliamentary accountability, the Secretary of State can give directions where it is necessary to do so in relation to a particular NHS body.
Baroness Carnegy of Lour: The noble Lord used a somewhat circular argument. For the sake of clarity, is it the case that CHAI can conduct a review on its own initiative or be told to do so by the Secretary of State but that the regulator cannot do anything about either of those things? Is that correct or have I got it wrong? Is the regulator left out of the process?
Lord Warner: We have had this discussion many times. CHAI is responsible for inspecting all NHS
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bodies in terms of their ability to deliver satisfactory, quality healthcare and for assessing their performance. In effect, the regulator is giving a market authorisation for particular trusts to operate with the freedoms that go with an NHS foundation trust. It does not carry the same responsibility other than when there are so many concerns about performance as to call into doubt the legitimacy and validity of that market authorisation. It is not for the regulator to respond to every set of concerns that there may be about the broad range of healthcare provided by a particular trust.
Earl Howe: I am grateful to the Minister, although I am a little disappointed. I believe that the sidelining of the regulator in relation to his responsibilities for foundation trusts is regrettable. That is what the Bill appears to do. It should not be for the Secretary of State to go in over the regulator's head, as I mentioned previously.
As regards the power given in the Bill to the Secretary of State to instruct CHAI to initiate a review, I believe that it is a question of balance. Used sparingly, that power is perfectly reasonable; used regularly, it would not be reasonable. I am somewhat heartened by what the Minister had to say about how he envisaged the power being used and, indeed, the reason for it being in the Bill at all. But it remains to be seen whether his view of matters is borne out by events. I am still uneasy about these provisions but between now and Report I shall read carefully what he said. For now, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 51 [Reviews and investigations: England]:
[Amendments Nos. 289 to 296 not moved.]
Lord Warner Lord Warner moved Amendment No. 296A:
Page 19, line 26, leave out "An NHS body must, if regulations so provide," and insert "The Secretary of State may by regulations require an NHS body to"
The noble Lord said: Both government amendments—Amendments Nos. 296A and 297A— are simply clarificatory in nature and have been tabled on the advice of parliamentary counsel to ensure that the current practice of NHS bodies being required to publish action plans in response to reviews and investigations undertaken by the current Commission for Health Improvement continues.
NHS bodies are required to publish an action plan in response to a CHI report and to agree that plan with the relevant primary care trust or strategic health authority. The rationale here is clearly to ensure that the NHS takes action to improve and that the action plan is feasible and affordable. We believe that that approach should continue and so have also taken the opportunity to clarify that other areas in regulations relating to current CHI can be included in future regulations relating to new CHAI. Those include: time limits for preparing statements; copying statements to others; and matters that should be covered in statements. There is no need to make a similar

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amendment in relation to CSCI clauses since such arrangements are set out under the comprehensive performance agreement processes. I beg to move.
Baroness Noakes: I thank the Minister for his explanation of Amendments Nos. 296A and 297A. I have tabled Amendment No. 297 in this group. That amendment seeks to delete the mention of regulations from Clause 51(8). We can see no real reason for the regulations. The subsection reads perfectly well without it. It places a positive requirement on an NHS body to publish its action plan following a CHAI report. Again and again, we return to the issue of why the Secretary of State must become involved.
The issue of regulations and statements of action caused some confusion when it was discussed in another place. In fact, the Minister in another place— Mr Lammy—gave two different explanations for the regulation-making power. On 5th June, he said that the regulation-making power related to the rare case of a foundation trust not publishing its response. He said:
"We therefore seek the power to put it right, should it ever become necessary".—[Official Report, Commons Standing Committee E, 5/6/03; col. 623.]
However, five days later, he said that regulations enable some flexibility to provide more details of how and when a statement of action to be taken will be published and, to that extent, the regulations follow in the normal way. I am not sure that I understand the whole of that sentence, but I believe that the first half says that the regulations concern the issuing of the statement.
The Minister says that the regulations will be about much more than just issuing statements and certainly not just for recalcitrant NHS bodies. Why can that not be left to CHAI and to the NHS bodies themselves? If an NHS body gave no action plan or gave an inappropriate report, surely there are plenty of levers already within CHAI. The case is simply not made for the Secretary of State to get involved at all. The sense behind our amendment applies equally to the amendments moved by the Minister. I hope that he will explain why the Secretary of State must have this power.
Lord Warner: It is simple. I thought I had explained the point in relation to some of our amendments. We believe that to have such a regulation-making power is an important safeguard to ensure accountability of NHS bodies. Where inspections reveal that action needs to be taken, there has always been a concern that there should be a mechanism for ensuring that that action is taken and that there is accountability on the part of the inspected body to take action. We think it is important and it reinforces the work of CHAI to have this regulation-making power so that we can ensure that there is an action plan, that there are courses of action that are feasible and that CHAI reports are not ignored.
Baroness Noakes: I thank the Minister for that reply. Again we have come up against the gulf between
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these Benches and those opposite. We believe that CHAI should be set up as an independent body that can be trusted to do things. If CHAI needs more levers to ensure that NHS bodies take the appropriate action, we would be happy to consider such amendments, but we find it difficult to accept the sticky fingers of the Secretary of State being able to delve into the tiniest parts of CHAI's operations. I shall consider carefully what the Minister has said. Doubtless we shall pass his amendments in a moment but, as I said, the sense of Amendment No. 297 also applies to his amendments. I should put him on notice that on Report we are likely to return to the amendments on the revised sections.
On Question, amendment agreed to.
[Amendment No. 297 not moved.]
Lord Warner Lord Warner moved Amendment No. 297A:
Page 19, line 28, at end insert—
"( ) Regulations under subsection (8) may make provision—

(a) as to the matters with which a statement under the regulations must deal;

(b) as to the time by which any such statement must be published;

(c)requiring an NHS body, before publishing any such statement, to obtain the consent of any person specified in the regulations;

(d)requiring the NHS body publishing any such statement to send a copy of it to any person so specified."

On Question, amendment agreed to.
Clause 51, as amended, agreed to.
5.15 p.m.
Baroness Noakes Baroness Noakes moved Amendment No. 298:
After Clause 51, insert the following new clause—
"REPRESENTATION TO THE CHAI
A report under sections 50 and 51 which relates to, or identifies, a specific NHS body shall not be made by the CHAI unless a draft of the report has been shown to the NHS body and—

(a)it has confirmed that it does not disagree with the draft report,

(b) it has not responded within a reasonable period of receipt of the draft report, or

(c) it has submitted comments to the CHAI in respect of the draft report and the CHAI has considered those comments."

The noble Baroness said: In moving Amendment No. 298 I shall speak also to the other amendments in the group. The amendments concern several aspects of reporting on NHS bodies covered by the Bill. Amendment No. 298 inserts a new clause after Clause 51 and relates to the reports that CHAI issues under Clauses 50 or 51. Many of the reports will be generic and will not always identify individual NHS bodies, but they may. In particular, a report under Clause 51(2)(c) will, by definition, be about an individual body.
I am quite sure that CHAI will carry out its investigations and write its reports with the highest standards of professionalism. Our amendment should not be taken to imply any criticism of CHAI, but it is possible for facts to be wrong or to be misinterpreted. That is why, for example, when the NAO carries out

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a value for money investigation it must not publish its report until the factual accuracy of the report has been agreed with the department concerned.
Amendment No. 298 is designed to put a small amount of balance into the process. CHAI must show a draft report to the body and must not issue it unless one of three things occurs: the body agrees; the body does not respond within a reasonable time; or the body responds and CHAI has considered any comments submitted to it. That is all very simple and designed not to impede the process but to improve it.
Amendment No. 301 is even more important because it relates to Clause 52 and a report of failings. Those reports can bring down the wrath of the Secretary of State or the regulator, or both, on the body. It is absolutely vital that the NHS body has an opportunity to state its case. Amendment No. 348 is the equivalent of Amendment No. 301 for CSCI and its reports on local authorities.
Amendment No. 300 probes what is meant by "special measures". The term is used as a possible remedy for failings that are reported under Clause 52. But "special measures" are not defined anywhere in the Bill. They could involve almost anything, but what is a measure and what makes it special? I believe that there should be more certainty about what CHAI could recommend which is why Amendment No. 300 seeks the definition of special measures in the Bill.
I understand that the term "special measures" has a meaning in the local authority context. Even if it has a precise meaning there, it does not make it comprehensible in the NHS world. The Explanatory Notes at paragraph 141 talk about special measures being an extra CHAI inspection or, rather loosely,
"other practical assistance or organisational support".
Are we quite clear that special measures must be confined to those anodyne remedies or can cruel and unusual punishments lurk within the term? I would be grateful for the Minister's views. I beg to move.
Lord Warner: I am slightly puzzled by what the noble Baroness has said. I had believed that we were discussing special measures under Amendment No. 300, which is not in this group.
Baroness Noakes: I beg your pardon. I had expected Amendment No. 300 to be in this group. It is another amendment that has been in and out of groups over the past 48 hours. I shall speak to my amendment again when we come to the group, but more briefly.
Lord Warner: I thank the noble Baroness. I am all in favour of big groupings as the noble Baroness knows. The practical effect of this group of amendments will serve to require CHAI and CSCI to give NHS bodies and local authorities the chance to comment upon the contents of reports before they are published where they have found significant failings. It is right that CHAI and CSCI should discuss the findings generally with healthcare providers and with local authorities prior to the publication of the reports. Indeed that is standard good practice within the current Commission
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for Health Improvement and the Social Services Inspectorate, which we fully expect CHAI and CSCI to continue. That makes certain that the trusts and local authorities concerned are able to ensure that the inspectorates make an accurate assessment of the services that they provide. Early sight of the contents of those reports would enable the body concerned to make a start on its action planning, hence bringing about early improvements to the services that it provides.
However, the Committee has to balance that with the fact that we are establishing CHAI and CSCI as authoritative independent inspectorates providing patients and service users with clear assurances about the safety, quality and efficiency of the services that they receive. If the inspectorates did not have the freedom to take action quickly here, that could lead to delay in some cases and to protracted action. Healthcare providers or councils might be in denial— in my experience that has happened—about the quality of their services and it would be difficult to confront the issue. That would not be in the best interests of patients and service users. CHAI and CSCI must, in our view, reserve the right to disagree with the inspected body and to take immediate action where they have the evidence to do so. This group of amendments does not put the service user first and tends to leave providers in the driving seat, possibly to the disadvantage of the user.
I acknowledge that other inspectorates, such as the Chief Inspector of Prisons and Ofsted, give the bodies they inspect sight of reports in advance of publication to give them the chance to correct factual inaccuracies. However, as I understand the position, there is no statutory provision to require those inspectorates to give the bodies they inspect prior sight of their reports before publication. I agree that we should aim for consistency between inspectorates in this respect. I am minded to consider further the principle behind the amendment without necessarily accepting this particular wording.
Baroness Barker: Perhaps the noble Lord will give his views on Amendments Nos. 299 and 308, which are in the group. Amendment No. 299 requires CHAI to report on failing in relation to the provision of guidance issued by the Department of Health. For example, the ombudsman's report earlier this year criticised the department for its failure to give clear guidance on continuing healthcare criteria, which had a very direct effect on NHS and local authority performance in that area. I agree with the noble Lord that the CHAI studies on the strategic nature of health and social care will be highly important. Should they not also include an assessment of the Department of Health and, in particular, the Secretary of State's guidance? That would be a true measure of the independence of the bodies we are setting up. There is a need to have that on the face of the Bill. Perhaps the noble Lord will comment on the issue.
Lord Warner: We have already made it clear that there is nothing to stop CHAI giving advice to the

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Secretary of State on anything which it considers is relevant to its function. We have said repeatedly that we do not think that it is right to force CHAI, in effect, to act as a judge of government policy when that is set out in guidance to the NHS. If CHAI has concerns about this—in terms of it causing problems in healthcare delivery—it will be open to CHAI to put its views to the Secretary of State.
Amendment No. 308 would enable CHAI to undertake specific studies in relation to particular statutory provisions or any other direction or guidance issued to the NHS. Presumably the amendment's purpose, as the noble Baroness says, is to hold the Government to account for their health policies.
The amendment is not necessary because Clause 53 already provides powers for CHAI to give advice as it feels fit, either to or at the request of the Secretary of State or, indeed, the Welsh Assembly, on any matter connected with the provision of healthcare.
We do not believe that it is right to set up CHAI as a judge of government policy, and, in a sense, an arbitrator on government policy. Equally, however, the Bill provides for CHAI to give advice to the Secretary of State when it thinks that is appropriate.
Baroness Barker: Will CHAI's advice be publicly available? Will CHAI have a role in advising the Secretary of State on its guidance to local authorities and NHS bodies? Therefore, it will not be a commentary, as such, on government health policy; it will be about how that government health policy is being conveyed to the bodies being judged on their performance in carrying out and implementing that policy, which is a different matter.
Baroness Howarth of Breckland: What I am about to say may help the Minister rather than elucidate what was said by the noble Baroness, Lady Barker. Will CHAI be carrying out similar functions to CSCI in terms of the Royal Commission function, which means that it will be gathering information that will reflect on government policy once it is formalised and conceptualised? Presumably, all that information will go into the public arena—and directly into the public arena because there is a responsibility to report directly to Parliament. Will that not clarify this issue?
Lord Warner: The contribution of the noble Baroness, Lady Howarth, is helpful. Essentially, this comes back to the primary purpose of CHAI and CSCI. Their primary purpose is to inspect the work and performance of health bodies and local authorities on their delivery of social care. Therefore, we are setting up these independent bodies. Their primary purpose is not to second-guess whether government policy is right or wrong. It is the Secretary of State's responsibility to answer to Parliament and to the public on that issue.
Where CHAI or CSCI perceives that a particular piece of advice may be causing specific problems in operational terms in the delivery of healthcare, it is perfectly open to CHAI under the terms of the Bill to
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give that advice to the Secretary of State. But it is not its primary purpose. It is worth bearing in mind that much of the guidance issued by the Secretary of State does not simply come out of the blue; it follows a consultative process within NHS interests and local government. So it does not come as a surprise to the health service or local government that they are getting this guidance. We are operating in that context.
Behind these amendments there is a suggestion that somehow these things come as a great surprise and are not thought through and that we need these independent watchdogs to review the Government's policy. That is not the purpose of these two inspectorates. We do not think that the amendment is necessary. We think that what is proposed would divert them from their primary purpose.
Of course the inspectorates will publish their annual reports. If they have given advice to the Secretary of State on a particular issue, no doubt that issue will be covered in their annual report.
Baroness Noakes: I thank the Minister for his response. I think I can paraphrase it to the noble Baroness, Lady Barker: the Secretary of State is above review; it is everyone else that has to be reviewed. I am sure that the matter will come up again at later stages of the Bill.
The Minister talked about CHAI needing to get reports out quickly. My amendment states that the body has to respond within a reasonable time. It was deliberately drafted to recognise that one size would not fit all and that it would be possible to have different timescales. But I think that the principle of involving the body, even if only for 48 hours, is extremely important.
I am grateful to the Minster for saying that he would take away the issue. I look forward to hearing his further deliberations. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 52 [Failings]:
[Amendment No. 299 not moved.]
Baroness Noakes Baroness Noakes moved Amendment No. 300:
Page 20, line 2, at end insert—
"( ) For the purposes of this Part, "special measures" means one or more actions that are specified in regulations."
The noble Baroness said: I shall speak very briefly to Amendment No. 300, having spoken to it once already. I remind the Minister of my questions. What are measures and what are special measures? Is it possible for cruel and unusual punishments to be imposed on NHS bodies? I beg to move.
Lord Warner: I am sure that Sir Ian Kennedy and his colleagues would not look favourably on any suggestion that they should be recommending cruel and unusual punishments. They may recommend special measures that they feel, given CHAI's expertise and first-hand account of the situation, should be taken to rectify the failings it has identified. In doing

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so, CHAI must give a clear justification for its recommendations. It will then be for the Secretary of State to consider what further steps should be taken.
We do not think that it is right to prescribe the detail of this in legislation. CHAI will consist of people with expertise who will go to a specific body. It will find out what may or may not be wrong and my expectation is that it will tailor its recommendations to putting things right as speedily as possible in that particular set of circumstances. Those are the special measures that we are talking about.
Should CHAI wish to recommend measures which are not specified in regulations there would in my view be an unacceptable delay while the regulations had to be mended. That could be an effect of the amendment. It would be unworkable for both parties to have their hands tied in such a way, especially given the unpredictable nature of some of the things that may be discovered by an inspectorate when reviewing a body. That is best left to the judgment of CHAI; we are sure that in order to have credibility with the NHS, the special measures that it recommends will be fit for purpose given the circumstances that it has inspected.
5.30 p.m.
Baroness Noakes: This is one of the rare occasions on which the government are prepared to trust CHAI's judgment, so I suppose that one should not be ungrateful for having identified one such small area. However, because this is such an important issue for the NHS bodies affected by the provision, it is right that the Bill should—whether directly or indirectly by regulation—specify what are the boundaries within which recommendations may be made for special measures.
That is such a vague term. It has no recognised meaning in the NHS and there are no principles by which to decide what it can and cannot do. For the sake of clarity for the NHS, it is important to ask the Government to set out what sort of things CHAI or CSCI could recommend. If, over time, those things became insufficient, that could be amended by further regulations, but clarity would again be important.
Although the Minister's response was good on the basis that he trusts CHAI, it was unhelpful because it did not provide important clarity to the NHS. We may want to return to the matter on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 301 not moved.]
Clause 52 agreed to.
Clause 53 [Functions relating to Secretary of State and Assembly]:
Baroness Noakes Baroness Noakes moved Amendment No. 302:
Page 20, line 32, after "to" insert "make regular reports available to the public about and"
The noble Baroness said: I shall speak also to Amendments Nos. 304 and 339. The amendments provide for CHAI and CSCI to make regular reports to the public. Amendment No. 302 relates to making public reports, alongside keeping the Secretary of
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State and the Assembly informed on healthcare provision by NHS bodies. Amendment No. 339 provides the equivalent for CSCI. Amendment No. 304 provides for public reports alongside keeping the regulator informed about foundation trusts.
When this was debated in another place, the Minister, Mr David Lammy, said that it was:
"obvious that the new CHAI will want to keep patients and the public informed of developments in the NHS and in independent health care provision".—[Official Report, Commons, Standing Committee E; 5/6/03; col. 577]
With respect, there is nothing obvious about that. CHAI could well start out with good intentions: I have no good reason to doubt that; but who is to say that informing the public will remain a priority? There is no mention of it in the basic duties of CHAI or of CSCI. Those of us who have operated in and around the public sector for many years have acquired a degree of cynicism about the long-term commitment to public information.
That is why I believe that the Bill will be improved by the amendments. I beg to move.
Baroness Masham of Ilton: How will CHAI inform the public; in what way?
Baroness Howarth of Breckland: I would support the noble Baroness, Lady Noakes, except that I believe that the provision is contained in Section 7 of the previous Act—certainly for CSCI's responsibility. However, the amendment also relates to my previous comment, which is that such public reports will overall be reflected in government policy, so the noble Baroness should take heart from that.
Lord Warner: I have some sympathy with the intent behind the amendments, but I must resist them none the less. Of course we are all keen to improve public information about performance of public services, and the Government are doing so. If I may say so, that is why we favour performance ratings, but there seem to be different views about that.
The Bill already contains provisions designed to ensure that the commissions' expertise and understanding of services are made available to the public. That may help the noble Baroness, Lady Masham. Clauses 51 and 57 for CHAI and Clauses 78 and 80 for CSCI provide that following an inspection, the commissions must publish reports of their findings. Most fundamentally, the "Reports and Information" clauses for CHAI and CSCI—Clauses 63 and 85 respectively—place a duty on them to send out copies of reports to those who request them. The commissions are also required to produce an annual report to Parliament that, will also be available to the public.
So there are substantial provisions in the Bill to ensure that those reports are in the public arena. To place a wide-ranging general duty on the commissions to keep the public informed about services, as the amendments are framed, could give rise to important

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practical problems. Given the wide-ranging demands that could be placed on the commissions, such a duty could place a serious burden on them.
However, I am willing to think further about the issue before Report to see whether there is anything practical that we can do to help.
Baroness Noakes: I am grateful to the Minister for his response—in particular, for his agreement to take the matter away to reconsider it. There is a difference between the information provisions that he mentioned, which are scattered throughout the Bill, and those referred to in the amendments. It is that information that we are trying to ensure will be in the public domain and will not be subject to a decision, which might in future not be open and transparent, about whether to keep the public informed. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments No. 302ZA and 302A not moved.]
Clause 53 agreed to.
Clause 54 [Functions relating to regulator]:
The Deputy Chairman of Committees (Lord Murton of Lindisfarne): Before calling Amendment No. 303, I must tell the Committee that if it were agreed to, I should be unable to call Amendment No. 304 because of pre-emption.
Earl Howe Earl Howe moved Amendment No. 303:
Page 21, line 6, leave out "is to keep the regulator" and insert "and the regulator are to keep each other"
The noble Earl said: Clause 54 deals with the functions of CHAI relating to the regulator. In subsection (1), CHAI is required to keep the regulator informed about the provision of healthcare by and for NHS foundation trusts. The process should work both ways. Obviously, the regulator is to a large degree dependent on CHAI to inform him of any concerns about the quality or availability of services provided by foundation trusts. Equally, CHAI ought to be able to rely on the regulator to inform it of any matters that may help it to perform its functions better.
I am here thinking especially of any notable example of good practice in a foundation trust—bearing in mind that in Clause 47(1) the general function of CHAI, before all others, is that of encouraging improvement in the provision of NHS healthcare. But it is also possible to imagine the regulator being made aware of an area that merits possible investigation by CHAI—not only in the foundation trust concerned but in the NHS more widely. An example might be a deterioration in the delivery of cancer services by a foundation trust within a cancer network or plans by a foundation trust to reconfigure one of its services in a way that may have a knock-on effect on other NHS bodies. In those and other such circumstances, the regulator should have a duty to communicate any concerns to CHAI. That ought to be a specific duty. I beg to move.
Lord Warner: The regulator and CHAI will be under a duty to co-operate with each other under Clause 54(3). That duty will ensure that the regulator keeps CHAI informed of any other information relevant to the exercise of CHAI's functions. However, the regulator does not have a function of reviewing healthcare provision of NHS foundation trusts. It is not therefore sensible to require him to keep CHAI informed about such provision. The distinction that we make is not to place a duty on the regulator, as the noble Earl proposes, but to use the duty to co-operate in Clause 54(3) to ensure that the regulator makes available to CHAI information relevant to the exercise of its functions.
Earl Howe: I am surprised by that answer. I realise that there is a clear distinction between the role of CHAI and that of the regulator. The regulator is not expected, in the normal course of his duties, to carry out inspections and to supplant CHAI. But I would have thought that he should have a duty to inform CHAI if any matters of concern came to his attention. The duty to co-operate in Clause 54 does not seem explicit enough. If it were, one would have to ask why subsection (1) of Clause 54 was necessary in the other direction. The Government clearly thought it important to give CHAI a specific duty to keep the regulator informed—in other words, it is not enough to rely on the duty to co-operate. We shall have to reflect on the matter. I am not convinced by the Minister's reply, but, for now, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 304 not moved.]
[Amendment No. 304A had been withdrawn from the Marshalled List.]
Clause 54 agreed to. Clause 55 [Reviews of data]:
On Question, Whether Clause 55 shall stand part of the Bill?
Earl Howe: I ask the Minister to comment on this clause, because the Explanatory Notes are not very illuminating. Subsection (1) states:
"'The CHAI may review—
(a) the quality of data obtained by others in relation to the provision of health care".
I am not clear who the "others" are in that context. It is potentially a very wide provision that would appear to allow CHAI to review data sources outside the public sector. If that is a correct interpretation, will the Minister gave an example of what kind of data sources could be reviewed in that way, and why?
Lord Warner: I shall try to help. I appreciate the noble Earl's reasons for raising the issue. Clause 55 will enable CHAI to evaluate studies and research carried out by other bodies. Such bodies might include the Royal Colleges, independent commentators, academic institutions or other organisations concerned with public policy or services.

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It is very important that patients and the public have a clear picture of what is happening in the NHS. As we all know too well, it is understandably the subject of much analysis and commentary, sometimes conflicting and sometimes misleading. But patients and the public deserve to have the facts about the NHS as it is. We therefore wish to ensure that there is a safeguard that, in fulfilling its role as the pre-eminent independent organisation to which patients and the public look for information about the quality of NHS care, CHAI can evaluate and, where appropriate, comment on the quality of studies carried out by other bodies, including the methods used in carrying out those studies. That may be to confirm that the studies have a solid basis in evidence and reach valid conclusions.
The National Health Service Reform and Health Care Professions Act placed a similar function on the Commission for Health Improvement to conduct reviews and issue reports on the quality of data obtained by others relating to the management, provision, quality, access and availability of healthcare for which NHS bodies or service providers are responsible, the validity of conclusions drawn from such data and the methods used in their collection and analysis. This clause gives a similar role to the new CHAI.
Subsection (2) makes clear that CHAI must publish a report. That will enable the public to make informed judgments about the quality of information available and healthcare provision. It will help to provide transparency in CHAI's work.
By contrast, CSCI, under Clause 76, will look at research into social care and determine whether it can improve the quality of social care services. It will look, in particular, at the conclusions of such research and whether they are valid. That is different from the role of the Social Care Institute for Excellence, which gathers and publicises knowledge about how to improve social care services. I have given information on CSCI in the hope that it will be helpful, although the noble Earl did not raise it. I have tried to explain the thinking behind Clause 55.
5.45 p.m.
Earl Howe: That is helpful. I am grateful to the Minister. How is CHAI supposed to get behind data provided by the Royal Colleges or academic institutions to review them? It has no power in the Bill to require a body in the independent sector to co-operate with it or to supply further and better particulars. Merely to review the data as they stand might lead to CHAI producing what none of us wants—a half-baked analysis. I am unsure, given the lack of powers in the clause, whether it will be enough for the purposes that the Government clearly have in mind. Can the Minister shed more light on that?
Lord Warner: CHAI would not fulfil its primary duties if it sat around waiting for reports that it might wish to have a go at, or if it tried to investigate too many. I am sure that we can all remember circumstances where there is controversy and differences of view on an issue. Where possible, CHAI
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might wish to look into those differences of view and to do its best—possibly using its own data, for example—to clarify the situation in the public interest. CHAI could not force people to give it access to their methodology and data. On the other hand, if it raised concerns about the validity of particular views expressed, those espousing those views would wish to put their methodologies in the public arena and make them available for CHAI to examine. That is all that we are trying to do.
Earl Howe: Once again, I am grateful to the Minister. We would all have that hope in those circumstances. There is a risk that CHAI will not be able to get sufficiently behind the methodology to make a balanced and well informed judgment. One must hope that there will be an inclination to co-operate, if not a specific duty.
Clause 55 agreed to.
Clause 56 [Co-ordination of reviews]:
Baroness Noakes Baroness Noakes moved Amendment No. 305:
Page 21, line 20, leave out "may" and insert "must"
The noble Baroness said: The effect of this amendment on Clause 56 would be that CHAI "must", rather than "may", co-ordinate reviews of health bodies. It is, in part, a debate along the may/shall lines that our Committees often enjoy.
We support the basic thrust behind Clause 56. For far too long there has been at best patchy co-ordination of reviews of bodies in the NHS. There are many stories of the revolving door syndrome when as soon as one reviewer departs the next arrives. I was recently told that 39 different bodies, including the Royal Colleges, have the right to review an NHS trust. This is hugely wasteful and demoralising for the staff who just want to get on and deliver patient care. It is right to put someone in charge of this and someone must, not may, do that co-ordination.
There is a question, however, about whether CHAI should be doing that. Given the huge tasks that CHAI already has to deliver, we might be overloading it. How much of CHAI's time is estimated to be absorbed in this task? Organising 39 reviewing bodies over hundreds of NHS bodies is not a part-time activity. Will CHAI be resourced to do this? We want CHAI to make a positive impact on the ground and it will not be able to do that unless it is properly resourced and well set up to do the task. What levers will CHAI have to ensure compliance with its co-ordination function? It is all very well to say that CHAI may or must co-ordinate, but it takes two—or possibly 39—to tango. What happens if the other bodies refuse to join in? I beg to move.
Lord Warner: Amendment No. 305 would place an explicit duty on CHAI to promote the effective co-ordination of reviews and assessments carried out by other public bodies or other persons in relation to healthcare provided by English NHS trusts and cross-border special health authorities. It is important that we understand that the use of the word "may" is normal parliamentary language when a general

1315
function—which is what this is—is being specified rather than a particular duty. That is why the word "may" has been used rather than "must". I am confident that CHAI, the primus inter pares of healthcare inspectors, will want to ensure that it facilitates the sharing of best practice between other bodies that have an interest in the provision of healthcare. Given Professor Sir Ian Kennedy's previous comments on the fragmentation of NHS inspection, I am confident that the commission will want to seize the initiative on relieving the burdens of inspection on frontline NHS staff.
I cannot estimate the time that this function will cause CHAI to invest in terms of resources, but I assure the Committee that we are not setting up CHAI to be inadequately resourced. We want it to have the appropriate resources to enable it to fulfil its functions. That is our approach. I also remind members of the Committee that Sir Ian's document Vision for CHAI clearly indicates the commission's willingness to work in real partnership with others, especially in the area of common data collection. I am not convinced that we need to include the explicit duty proposed in the Bill, but I am willing to look again at the issue raised in the amendment, which I agree with the noble Baroness is an important one, and return to the matter on Report if we think that we can make drafting improvements.
Baroness Carnegy of Lour: Many people will regard that as good news. Will the Minister clarify what is meant by general functions? He said that this was a general function of CHAI rather than a specific duty. When he discusses that matter with his officials perhaps he could clarify what that means, because it is a slightly woolly statement. Is it really an optional rather than a general function? The description is one of so many that he has given that I cannot expect him to be anything but annoyed at my niggle, but I thought that it was rather a woolly answer to say that it was a general function rather than a specific duty.
Lord Warner: I will write to the noble Baroness.
Baroness Carnegy of Lour: There is no need to write. I do not want to use the Minister's time, but he may bring the matter into discussion with his officials.
Baroness Noakes: Will the Minister answer my question about what levers CHAI would have to ensure co-ordination? It is an important point.
Lord Warner: In an earlier amendment, I think that the noble Baroness used the phrase "cruel and unusual punishments". They will not be a feature of CHAI's style and approach. Special measures will not be its approach. It will use its leading position in this area, its vision, its authority and ability to persuade people and keep reminding them of the impact of inspection on people on the front line and managers in the NHS to ensure that there is not a steady traffic of inspectors of one type or another going to the same authorities week after week. That will be the approach. I am sure that
1316
Sir Ian and his team will want to use friendly persuasion as far as possible, but will make it clear when there are serious concerns that need to be addressed by other inspectorates.
Baroness Noakes: I thank the Minister for that reply. It was a pity that he was not able to respond to the question asked by my noble friend Lady Carnegy. It was a reasonable question to be able to elucidate that distinction during the course of our Committee, because he mentioned it in his own response. My noble friend did not ask for a reply, but it might nevertheless be useful for other members of the Committee who, like my noble friend, also cannot immediately see with clarity how the measure will work in practice.
If Sir Ian Kennedy reads the Hansard of our proceedings, I am sure that he will be grateful to see as near as one can get to a statement of commitment to resource by the Government. That is certainly welcome, because it is important that CHAI is resourced properly to perform the tasks laid on it. This is an important task. Given that it has no levers, whether CHAI can have an impact is also linked to resource. If CHAI is properly resourced and can play its leading part much will follow naturally. If it will always have to make hard decisions about what can and cannot be done fully within its resource envelope, it may not be able to maintain its pre-eminent position; it may not be able to co-ordinate effectively. Perhaps those are matters for debate at another time.
I was grateful that the Minister said that he would look again at the thrust behind the amendment. We think that the issue is important and I look forward to rejoining the debate on an amendment moved by one or another of us on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 306 not moved.]
Clause 56 agreed to.
[Amendment No. 307 not moved.]
Clause 57 [Studies as to economy, efficiency etc]:
[Amendments Nos. 307A and 308 not moved.]
Clause 57 agreed to.
Clause 58 [Additional functions]:
Baroness Barker Baroness Barker moved Amendment No. 309.
Page 22, line 9, after "efficiency" insert ", equity"
The noble Baroness said: This is a rather simple amendment to probe or highlight one of the more interesting questions that we have worked around in different ways throughout our Committee proceedings—the absence of the word equity in the long list of things that CHAI and CSCI are meant to investigate and review. The Bill talks about improvement of economy, efficiency and effectiveness of the exercise of NHS bodies but nowhere does it mention equity, fairness, or access to health care for different groups of the population. I reiterate my earlier comments that many of us have concerns about the extent to which minority populations or people with particular conditions will fare in this brave new

1317
world of acute hospital provision. It seems strange that that principle is not on the face of a Bill that sets out in such a heavy-handed way the extent to which these bodies will work and that establishes—as the noble Baroness, Lady Noakes, said—the very strong hand of the Secretary of State. That is why we seek to insert the provision.
We think that equity is one of the important founding principles of the NHS. We also think that it is an important enduring principle, no matter how the NHS is managed. We think that it should be inserted into the Bill.
6 p.m.
Lord Chan: I support Amendment No. 9. When CHI, the current body, was looking at its regular reviews, it emerged that enquiries had not been made in the summer of 2001 into the issue of equity for ethnic minority groups. I know that because I was asked in 2001 to advise CHI on the issue. I think that the point should be very clearly spelt out for any new body such as CHAI.
Baroness Masham of Ilton: I, too, support the amendment. As president of the Spinal Injuries Association I know very well that severely disabled people going into hospital can have truly terrible difficulties particularly as regards help with their bodily functions. We are currently having a series of conferences with the Royal College of Nursing about evacuation of the bowels which all paraplegics and tetraplegics have to do. There is huge difficulty when they go into a general hospital.
Lord Warner: We are certainly not out of sympathy with the thinking behind Amendment No. 309. Clearly it would be possible to give CHAI a new function under Clause 58 that included considering the fairness or equity of healthcare provision. It is worth reminding noble Lords that we have made it clear in Clause 47 that CHAI is to be concerned with all factors relating to the quality of healthcare when it exercises any of its functions in the provision of healthcare under Clause 47(1) or Clauses 48 to 56.
It is our view that regulations under Clause 58 could require CHAI to be concerned with any of the factors listed in Clause 47(2) in connection with any new function. To do so could be considered to be part and parcel of conferring a new function, or else would be covered by the power to make incidental or supplementary provision in Clause 191. So there is already plenty of provision to do that in the Bill. However, we think that the precise provision required would depend on the details of the proposed new function. We think that that is a matter best left to regulations rather than set out on the face of the Bill, so that it can be made more specific to a particular function.
Baroness Barker: I thank the Minister for his reply although I did not find it particularly compelling. Given the principle of equity and its importance in the daily provision of services, it is very strange that it
1318
should be left to the outer darkness of regulation and to the rather obscure permissive powers in the Bill. I take great heart from the support of noble Lords. We are not talking about the provision of specialist services. We are talking about ensuring that individuals and groups who are disadvantaged in health and social care have access to services which everyone should have. We are not talking about special provision in any way at all.
The Minister's reply, like his earlier replies to earlier amendments from these Benches, is somewhat unsatisfactory. The amendment deals with a fundamental principle which is far too important to be left to vague permissive powers. It is disappointing that equity is not on the same level as economy, efficiency and all the rest of it. We may well return to the issue. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Noakes Baroness Noakes moved Amendment No. 310:
Page 22, line 18, at end insert—
"( ) Regulations made under this section shall not have effect unless they have been approved by a resolution of each House of Parliament."
The noble Baroness said: Amendment No. 310 would add a new subsection to Clause 58 so that regulations under that clause are subject to the affirmative procedure. I shall speak also to Amendment No. 354 which is a similar amendment to Clause 82 relating to CSCI.
Clause 58 allows the Secretary of State to add functions to CHAI. Paragraph 150 of the Explanatory Notes states:
"It is envisaged that CHAI may need to be given additional functions".
If it is already envisaged that CHAI may need additional functions, why are they not included in the Bill? Will the Minister say what additional functions CHAI might need?
The Department of Health's view as set out in its memorandum to the Select Committee on Delegated Powers and Regulatory Reform is that the healthcare sector is constantly changing with new initiatives emerging which would necessitate the extension of the already very wide functions of CHAI. I find it very difficult to envisage an extension of CHAI's functions. If we look at its functions under Clauses 47 to 57, it is hard to come up with a more comprehensive set of functions. Will the Minister say what kind of initiative would fall outside those functions? I really do struggle with this.
I am aware that a similar provision was included in the legislation creating the old CHI. Will the Minister say whether that has ever been used or whether its use has ever even been contemplated?
I am not at all clear that additional functions beyond those already set out in the Bill could ever be needed. However, if they were, I believe that Parliament should be given a proper opportunity to debate any regulations under this section. That is what my amendments are about. I beg to move.
Lord Hunt of Kings Heath: I wonder whether I may use this debate to raise an issue regarding potential

1319
additional functions for CHAI. In its report, Independent Regulators, which I have read, the Better Regulation Task Force points out:
"The Commission for Health Improvement does not have an appeals mechanism".
I question whether that is right given the importance of the reviews currently undertaken by CHI and in future by the Commission for Healthcare Audit and Inspection.
The question which I should like my noble friend to consider between Committee and Report stage is whether it will be possible through Clause 58 to add an additional function to ensure that CHAI is subject to independent review. Noble Lords opposite have disagreed with me about the issue of performance ratings. I do not think there is any doubt but that a CHAI review can have very important consequences for the individual institutions inspected. For example, a combination of a "poor" or a "very poor" review by CHAI with perhaps a no-star rating is almost certain to lead to people losing their jobs within that organisation.
There is an issue of "felt fair" justice. When the results of work by CHAI potentially lead to such adverse consequences on an organisation, there ought to be a mechanism whereby the work of CHAI is subject to an appeal or review mechanism. In raising the issue, I declare that I am a member of the advisory board of CHAI, but I am in no sense speaking on behalf of CHAI in this matter. It is important to ensure that there is a "felt fair" mechanism. Would my noble friend be prepared to look at it between Committee and Report?
Lord Clement-Jones: I hesitate to intervene at a point where I have taken no part so far. The noble Lord, Lord Hunt, raised a most interesting question as regards the Better Regulation Task Force itself. The Minister will know that next week I shall be taking the opportunity to ask a Starred Question about the Better Regulation Task Force report, which is an extremely good report. When Mr Arculus launched the report, the NHS was described as the greatest victim of regulatory excess.
As the noble Lord, Lord Hunt, said, one of the report's recommendations is that all independent regulators should have an appeals' mechanism so that stakeholders can challenge decisions without recourse to judicial review. The regulator should, however, be able to dismiss time-wasting appeals. That seems a good balance. The Minister is as keen on balance as he is on flexibility. I am sure that that will strike a chord.
It may be that we shall need further consideration of the report produced by Mr Arculus and his colleagues between Committee and Report stages. Some fruitful mining may be made of it in terms of further amendments on Report. In the mean time, it would be useful if the Minister could indicate his view as to the suggestion made by the noble Lord, Lord Hunt.
Lord Warner: As the noble Lord will concede, it is extremely difficult to keep one's balance when
1320
showing flexibility, but I shall endeavour to do so. As I said in previous discussions, we shall examine carefully the Better Regulation Task Force report on a number of aspects relating to the Bill. I shall take note of the points raised by my noble friend Lord Hunt and Members of the Committee and we shall consider them further.
As regards the amendment moved by the noble Baroness, Lady Noakes, we have no plans to add functions at present. But the provision—I think that she quoted the case for this power—is important in relation to the future. Certainly, I do not fancy my chances at always forecasting the future accurately in this area. It seems a sensible provision. In answer to the noble Baroness's other question, we have used the powers in the 1999 Act to give new functions to the Commission for Health Improvement in relation to NHS bodies that were not listed in the 1999 Act. That indicates that, even in a quite short period of time, there may be a need to act in this area, particularly in a field such as healthcare where the situation changes quite quickly.
Turning to Amendments Nos. 310 and 354, perhaps I may remind Members of the Committee that the House of Lords' Select Committee on Delegated Powers and Regulatory Reform considered the Bill in its 24th report. It did not think that it was a cause for concern that these regulations were made under the negative procedure. I want to put that on the record.
Amendment No. 354 seeks to ensure that regulations made under this clause are subject to approval by resolution of each House of Parliament; that is, the affirmative procedure. The Select Committee on Delegated Powers and Regulatory Reform considered the Bill and, in its report, states:
"None of the powers conferred on the Secretary of State is subject to affirmative procedure. Except where NAW procedures apply, and except in a small number of cases (such as commencement orders) where there is no Parliamentary procedure, the negative resolution procedure applies throughout".
The report continues:
"The National Health Service's legislative structure has, since its inception, left a great deal to subordinate legislation subject to negative procedure … and directions. This basic framework has been maintained on successive reorganizations, including those effected by the various enactments of recent years. We do not consider, therefore, that the number of delegated powers in the bill is a cause for concern".
I just want to put that on the record in relation to these particular amendments.
Baroness Noakes: I thank the Minister for that reply. I thank the noble Lords, Lord Hunt of Kings Heath and Lord Clement-Jones for raising the important issue of the appeals mechanism. We touched on that earlier in Committee deliberations. The report of the Better Regulation Task Force is clearly very important.
However, those matters were not the focus of the amendments that I moved earlier about whether there should be affirmative regulations for adding

1321
additional CHA1 functions. The Minister argued that he wants to keep this power to cope with changes over time. Perhaps we may agree to differ on whether there is enough legislation already to cover almost anything that any reasonable person could imagine occurring under the existing Bill. But if the department says it needs that power, the question arises as to what scrutiny should be applied.
I heard what the Minister said about the Delegated Powers Committee, whose report I have already read. I have the greatest respect for that committee, but it is incumbent upon Members of this Committee to consider whether, in individual cases, they are content to leave matters to the relatively light parliamentary scrutiny that negative procedure involves. This is an area where we should keep the extension of CHAI and the extension of CSCI under the firm control of Parliament: the affirmative procedure is good in this case. I should like to seek the opinion of the Committee.
6.16 p.m.
On Question, Whether the said amendment (No. 310) shall be agreed to?
Their Lordships divided: Contents, 99; Not-Contents, 111.

Division No 1

CONTENTS

Addington, L.

Jenkin of Roding, L.

Alderdice, L.

Jopling, L.

Anelay of St Johns, B.

Kilclooney, L.

Astor of Hever, L.[Teller]

Lamont of Lerwick, L.

Attlee, E.

Liverpool, E.

Barker, B.

Livsey of Talgarth, L.

Blackwell, L.

Lucas, L.

Blatch, B.

Luke, L.

Bledisloe, V

Lyell, L.

Bradshaw. L.

McColl of Dulwich, L.

Bridgeman, V.

MacGregor of Pulham Market, L

Brougham and Vaux. L

L.

Burnham. L.

Mackie of Benshie, L.

Byford, B.

MacLaurin of Knebworth, L.

Campbell of Alloway, L.

McNally, L.

Chan, L.

Maddock, B.

Clement-Jones, L.

Mancroft, L.

Colwyn, L.

Mar, C.

Cumberlege, B.

Mar and Kellie, E.

Dixon-Smith, L.

Marlesford, L.

Eccles of Moulton, B.

Methuen, L.

Elton, L.

Miller of Chilthorne Domer, B.

Emerton, B.

Monro of Langholm, L.

Erroll, E.

Murton of lindisfarne, L.

Fearn, L.

Newby, L.

Ferrers, E.

Noakes, B.

Fookes, B.

Northbrook, L.

Glenarthur, L.

Northesk, E.

Gray of Contin, L.

O'Cathain, B.

Hanham, B.

Onslow, E.

Henley, L.

Palmer, L.

Holme of Cheltenham, L.

Park of Monmouth, B.

Howe. E.

Pearson of Rannoch, L.

Howe of Aberavon, L.

Phillips of Sudbury, L.

Howe of Idlicote, B.

Plumb, L.

Howell of Guildford, L.

Rawlings, B.

Hunt of Wirral. L.

Razzall, L.

1322

Rees, L.

Skelmersdale, L.

Roper, L.

Smith of Clifton, L.

Rotherwick, L.

Stern, B.

Russell, E.

Stewartby. L.

St. John of Bletso, L.

Stoddart of Swindon, L

Saltoun of Abernethy, Ly.

Thomas of Gresford, L.

Scott of Needham Market, B.

Tordoff.L.

Seccombe, B. [Teller]

Tugendhat, L.

Selkirk of Douglas, L.

Waddington, L.

Selsdon, L.

Wade of Chorlton. L.

Sharp of Guildford, B.

Wallace of Saltaire. L.

Sharpies, B.

Walmsley, B.

Shutt of Greetland, L.

Williams of Crosby, B.

NOT-CONTENTS

Acton, L.

Hilton of Eggardon, B.

Alli, L.

Hogg of Cumbernauld. L.

Amos, B. (Lord President)

Hollis of Heigham, B.

Andrews, B.

Howarth of Breckland. B.

Archer of Sandwell, L.

Hoyle, L.

Ashton of Upholland, B.

Hughes of Woodside. L.

Bach, L.

Hunt of Kings Heath, L.

Bassam of Brighton, L.

Irvine of Lairg, L.

Berkeley, L.

Islwyn, L.

Bernstein of Craigweil, L.

Janner of Braunstone, L.

Bhatia, L,

Jay of Paddington, B.

Blackstone, B.

Jones, L.

Borrie, L.

Jordan, L.

Bragg, L.

King of West Bromwich. L.

Brennan, L.

Kirkhill, L.

Brett, L.

Layard, L.

Brooke of Alverthorpe, L.

Lea of Crondall, L.

Brookman, L.

Lipsey, L.

Brooks of Tremorfa, L.

Lockwood, B.

Burlison, L.

Lofthouse of Pontefract.L.

Campbell-Savours, L.

Macdonald of Tradeston, L.

Carter, L.

McIntosh of Haringey, L.

Chandos, V.

Mclntosh of Hudnall, B.

Clark of Windermere, L.

MacKenzie of Culkein, L.

Clarke of Hampstead, L.

Mackenzie of Framwellgate, L.

Clinton-Davis, L.

Mallalieu, B.

Corbett of Castle Vale, L.

Masham of Ilton, B.

Crawley, B.

Mason of Barnsley, L.

David, B.

Massey of Darwen, B.

Davies of Coity, L.

Mitchell, L.

Davies of Oldham, L. [Teller]

Morgan, L.

Dean of Thornton-le-Fylde. B. Morris of Aberavon. L

Desai, L.

Patel of Blackburn, L.

Dixon, L.

Plant of Highfield, L.

Donoughue, L.

Puttnam, L.

Dormand of Easington, L.

Radice, L.

Eatwell, L.

Ramsay of Cartvale, B.

Elder, L.

Randall of St. Budeaux, L.

Evans of Parkside, L.

Rendell of Babergh, B.

Evans of Temple Guiting, L.

Richard, L.

Falconer of Thoroton, L. (Lord Rooker, L.

Chancellor)

Sawyer, L.

Farrington of Ribbleton, B.

Scotland of Asthal, B.

Faulkner of Worcester, L.

Sheldon, L.

Filkin, L.

Simon, V.

Gavron, L.

Thornton, B.

Gibson of Market Rasen, B.

Tomlinson, L.

Goldsmith, L.

Turnberg, L.

Gordon of Strathblane, L.

Turner of Camden, B.

Goudie, B.

Warner, L.

Gould of Potternewton, B.

Warwick of Undercliffe, B.

Graham of Edmonton, L.

Watson of Invergowrie. L.

Grocott, L. [Teller]

Whitaker, B.

Haskel, L.

Whitty.L.

Haskins, L.

Wilkins, B.

Hayman, B.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.

Business of the House
6.27 p.m.
The Earl of Onslow: Before the Committee proceeds, I want to point out that 67 groups of amendments have been tabled. Your Lordships' House decided by a vote that, on the whole, we should tend to end our sittings at 10 o'clock. I concede that governments of every colour always get in a muddle towards the end of a Session, but 67 groups of amendments on an extremely important Bill means that, with only 10 minutes of discussion on each amendment, excluding Divisions and so forth, the debate will amount to 670 minutes. It is intolerable to be asked to go on talking and making intelligent decisions into the morning hours, when we shall all be groggy and tired.
I hope sincerely that we can be given an explanation by the Government business managers of how this has happened. It is completely at variance with the changed rules of the House. In the old days, there were occasionally all-night sittings, but this is not very satisfactory.
I shall be tempted to move that the House do adjourn at one o'clock tomorrow morning. I believe that normally one moves that the House do now adjourn, but I would not dream of doing that. It would be impertinent, wrong and unfair to Her Majesty's Government. However, I see no reason why we should not say that the House should adjourn at one o'clock. That hour is quite late enough for elderly gentlemen to talk about serious matters.
I want to hear from the Government what they intend to do because, as the Americans put it, I believe that there is an abuse of due process taking place in your Lordships' House.
6.30 p.m.
Earl Ferrers: Perhaps I may advise my noble friend that the House cannot "now" adjourn at one o'clock if it is not now one o'clock.
The Earl of Onslow: I was trying very hard not to say "do 'now' adjourn", only that the House should adjourn at one o'clock. Obviously the Government have a duty to get some of their business through.
Lord Grocott: I wish I had thought of that response first. I simply say to the noble Earl, Lord Onslow, that I am anxious to make quick progress on this important Bill. We are now on the fifth day in Committee. I know that there is good will on all sides to deal with the issues as expeditiously as we sensibly can. I suggest that we get on with it and see where we get to. As the noble Earl rightly said—he was generous enough to make the point—at this stage in the Session it is always difficult; we are always thinking about quarts and pint pots.
It is particularly important to complete the Committee stage because of the minimum intervals. The noble Earl knows that there will be more flexibility
1324
when we get to Report stage. I hope that noble Lords will bear that in mind and that we can get on with the business as rapidly as we can.
Baroness Carnegy of Lour: I know how the Back-Benchers feel but I wonder whether there has been any agreement between the Front Benches that we should not have another day for discussion of the Bill.
Lord Grocott: It was signalled on future business that we would go beyond 10 o'clock tonight. We have to do that some time in advance and, on that basis, you always hope that you will be able to conclude the Bill. Certainly that was the intention at the beginning of the five days. Admittedly there have been days when business has not progressed as quickly as one would have hoped.
I am sure that all noble Lords will agree that the House has a responsibility to complete its consideration and amendment of government legislation, as necessary, in an orderly way. I freely admit that sometimes we do not go at the pace I would wish and hope for, but, with good will, we are capable of completing this stage today. It may be that this will be the last time this Session that we have to press these late nights in quite the same way.
Baroness Carnegy of Lour: Is the noble Lord saying that this procedure has not been agreed by the usual channels?
Lord Grocott: The usual channels operate in agreement wherever it is humanly possible. It was always assumed that this would be long enough to deal with the Committee stage. No representations have been made. I do not want to go any further because it could endanger the normal confidentiality of the way in which the usual channels operate. The expectation certainly is that it would finish today.
We have spent four minutes discussing this issue. It makes my job very difficult if we constantly have these kinds of reviews during the course of progress of legislation.
Lord Elton: I do not in any way suggest that we should withhold good will, but I remind the Government Chief Whip that the Companion to the Standing Orders states:
"It is a firm convention that the House normally rises by"—
not "at" or "around" but "by"—
"about 10 p.m. on Mondays to Wednesdays".
It is quite a long time until prorogation next month. Therefore, to say that it is normal for this kind of pressure to exist at this time is not in accord with my memory. It may be that we have had too long a Recess or the business has not been arranged as it should have been, but I drag a little comfort from the noble Lord's remark that he hoped that it would not be necessary to do this again in this Session. I can assure him that he will be reminded of that if it is necessary.
Lord Grocott: It is a hope. That does not necessarily mean that it is an expectation. It is what I work for. I

1325
would not like the myth to get around that, of some 700 Peers, 699 want to get home by 10 o'clock and one does not—and that is the Government Chief Whip. Believe me, that is not the situation. I am probably more anxious to finish in sensible time than anyone else because, along with the other Chief Whips, I am here every day, whereas, quite naturally, Peers take more interest in some Bills than in others. That is the nature of the place.
We expect to finish within five days. That was discussed in the usual channels and I very much hope that it will be possible.
Baroness Blatch: Everyone understands the position in which the Government Chief Whip finds himself in trying to get business completed and the House up in time for State Opening on 26th November. However, without divulging anything that may have been said between the Front Benches and the usual channels, it is right to say that the discussions are as yet inconclusive and therefore the debate continues.
But the Government Chief Whip said that he hoped to finish today. In my book, "today" finishes at midnight tonight. The 24 hours started at midnight last night and finish at midnight tonight. Any reasonable person looking at today's groupings list would have seen amendments on two sides of A4 paper, and no one would have expected us to complete all of those amendments today.
I understand, and the Government Chief Whip understands, the anxiety felt, not by the usual channels—which are very close to the debate—but by our noble friends on the Back Benches. They seek an answer from the Government Chief Whip, not as to the time the House will rise but whether it is the intention that the House will rise only when the last amendment in the Marshalled List has been dealt with. The noble Lord has not made that clear.
Lord Grocott: Let me make it clear. It is my wish, desire and intention that we should complete the Committee stage of the Bill today, after five days. As I am sure the noble Baroness, Lady Blatch, knows as well as anyone else, in parliamentary terms one of the many myths of our operation is that "today" is today. Monday continues into Tuesday if the House is still sitting, and we refer to it in that way.
The clock started late and we have probably spent 10 minutes now on this discussion. We could have dealt with another group of amendments in that time. It would help us all if we could proceed with the Bill. I must repeat that if the Bill does not finish its Committee stage today it will have quite serious ramifications for this or another piece of legislation reaching the statute book. That decision is out of my control.
The House appears to be asking me each day to finish by a set time—in other words, to use a guillotine on time—but not to have any agreement with the House as a whole as to the amount of business that can be completed in that time. I exclude the usual channels from that. From where I am sitting, that sounds very
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much like having your cake and eating it. I should spell out the dilemma to the House. If you have to finish at a certain time but you do not have the faintest idea of how much business can be concluded during that set period of time, it is an extraordinarily difficult position to be in. I am happy to be in that position, but not if I have to have this same conversation each day.
The Earl of Onslow: The phrase "cake and eating it" came from the noble Lord, Lord Grocott. But he said that we have spent 12 minutes on this issue, so let us not discuss it further because it is cutting into the time that we have allowed for discussion on the Bill. He then said to those noble Lords who said they thought the agreement was that everyone should shut up by 10 o'clock and go home—obviously allowing some leeway—that they cannot have their cake and eat it. There seem to be hordes of cakes and great numbers of scoffers around here.
That makes it very difficult if you have a genuine complaint. Only last week exactly the same problem arose. The noble Countess, Lady Mar, was tempted to make this complaint before.
If the Government had got their act together and produced Bills earlier, we would not be in this position. It is the Government's business managers' fault. In the 30 years that I have been in this House—I thoroughly enjoy saying that, it is a great, bang-on statement—I have never known this House to waste time or filibuster. It is not in its nature. We are basically reasonable.
Having made my complaint—and I hope I have made it stick—I will not do anything, but if this happens again next week or the week after, I sincerely hope that the rest of your Lordships will back me in complaining strongly about the Government's misuse of the procedures of this House, as laid down in Standing Orders.

Health and Social Care (Community Health and Standards) Bill
Clause 58 agreed to
Clause 59
[Criteria):
[Amendments Nos. 311 and 312 not moved.]
Baroness Barker Baroness Barker moved Amendment No. 312A:
Page 22, line 26, at end insert—
"( ) If requested to do so by the Audit Commission in any particular case, the CHAI or CSCI may assist the Audit Commission in the exercise of its functions under section 33(1) of the Audit Commission Act 1998 (c. 18) (studies for improving economy etc in services)."
The noble Baroness said: Well, we begin again. I approach the rest of what is termed "today" with all the joy of a junior doctor starting a shift.
This probing amendment seeks to delve into an important area that we have not yet covered in our deliberations. The amendment probes the relationship of CHAI and CSCI—particularly CSCI—with the

1327
Audit Commission. When it takes over its functions, CSCI will inherit part of the function of the SSI but also elements of the Audit Commission's role.
I do not wish to rehearse the arguments that have already been made about the independence of these new bodies. One great benefit of both the Audit Commission and the National Audit Office has been the independent and thorough way in which they have looked at aspects of health and social care. The Audit Commission, in particular, has produced reports which have been among the most influential in enabling legislators to see the impact of legislation and have also pointed the way to future measures.
The amendment seeks to tease out which elements of the Audit Commission will be drawn on for CSCI, and what the future relationship between CSCI and the Audit Commission will be. I look forward to the Minister's reply. I beg to move.
Lord Warner: Amendment No. 312A is inappropriate in relation to CHAI because the Bill transfers the main responsibility for such studies in relation to English NHS bodies, other than special health authorities, to CHAI. The Audit Commission will no longer carry out value-for-money studies on those NHS bodies.
We agree that it is entirely appropriate for CHAI to be able to assist the Audit Commission in carrying out financial management studies and for CSCI to be able to assist the Audit Commission on studies relating to economy, efficiency and effectiveness on local authorities. However, we think it is already able to do so on the basis of the existing powers in the Bill and the Audit Commission Act 1998, and that this additional power is therefore unnecessary.
The Audit Commission will retain all its Section 33 functions in relation to Welsh NHS bodies. While we think it would be lawful for CHAI to assist the Audit Commission in carrying out those functions, it is the Assembly and not CHAI that will carry out reviews of particular Welsh NHS bodies. Therefore, any assistance to the Audit Commission with respect to studies in relation to Welsh NHS bodies is more likely to be sought from the Assembly than from CHAI.
It should also be noted that the Government have published a Bill in draft for consultation—the draft Public Audit (Wales) Bill. This proposes to transfer all the Audit Commission's functions in relation to Welsh NHS bodies to the Auditor-General for Wales. The draft Bill provides for co-operation with the Audit Commission, and it would be premature to legislate on this matter now.
That is the context. We have already discussed CSCI's relationship with regard to comprehensive performance assessments on local authorities and their relationship to CSCI.
Baroness Barker: I thank the Minister for his reply and shall study his words in Hansard. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
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[Amendments Nos. 313 and 314 not moved.]
Lord Warner Lord Warner moved Amendment No. 314A:
Page 22, line 38, at end insert—
"'( ) to consult any person specified in the regulations before publishing a statement under subsection (1) or (2);"
On Question, amendment agreed to.
[Amendment No. 315 not moved.]
Clause 59, as amended, agreed to.
Clause 60 [Provision of material]:
[Amendment No. 316 had been withdrawn from the Marshalled List.]
Clause 60 agreed to.
[Amendment No. 317 not moved.]
Clause 61 [Fees]:
Lord Warner Lord Warner moved Amendment No. 317A:
Page 23, line 14, after "body" insert "or to health care provided by or for that body"
On Question, amendment agreed to.
[Amendments Nos. 318 and 319 not moved.]
Clause 61, as amended, agreed to.
Clause 62 [Fees: Wales]:
Lord Warner Lord Warner moved Amendment No. 319A:
Page 24, line 6. after "body" insert "or to health care provided by or for that body"
On Question, amendment agreed to.
[Amendment No. 320 not moved.]
Clause 62, as amended, agreed to.
Clause 63 [Reports and information]:
[Amendment No. 321 not moved.]
Clause 63 agreed to.
Clause 64 agreed to.
Clause 65 [Right of entry: supplementary]:
Earl Howe Earl Howe moved Amendment No. 322:
Page 25, line 27, at end insert—
"( ) The CHAI must ensure that any documents or items removed under subsection (1) are not retained for an unreasonable period of time and must give reasons in writing for their retention if so requested by—

(a) the person from whose premises the documents or items were removed, or

(b) any other person with an interest in the documents or items."

The noble Earl said: In moving Amendment No. 322, I shall speak also to Amendment No. 335.
At the beginning of Clauses 65 and 71, which parallel each other, we see the familiar words "necessary" and "expedient". In the context of these clauses, which relate to the right of entry and inspection of premises by persons suitably authorised to do so, those words inevitably sound an alarm bell.
If you are someone whose premises are raided by CHAI or an equivalent official from the Welsh Assembly, what rights do you have? Not many, judging by the list of things that an inspector is entitled to do, as described in these clauses. That begs the question of what constitutes fair and reasonable

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behaviour by the person who decides, let us say, that it is necessary and expedient for him to remove from a set of premises the computer equipment, accounts and records that are housed there.
We are talking not just about NHS premises. As we all know, CHAI's remit, and that of the Assembly, covers independent businesses as well. I have no problem about putting the NHS and the private sector on to an equal regulatory footing, but at the same time there are other considerations. Those who manage private hospitals and clinics have businesses to run. These businesses cannot continue without the means at their disposal to do so. Records and accounts are an integral part of running a business day to day.
My proposal is not to deny the official inspector any of the rights granted to him but to balance those rights, albeit partially, with a corresponding right for the person whose documents or property are removed to ask for reasons if he considers that he has been deprived of their use for an unreasonable time. CHAI in turn would have to supply the reasons.
The amendment is not much, but it is something— perhaps enough to ensure that CHAI and officials in Wales remain conscious of the burdens that they place on business by exercising their rights to take charge of other people's property. There is only one way in which to ensure that, which is to add my amendment or one like it to the Bill. I beg to move.
Lord Warner: Amendments Nos. 322 and 335 would place a duty on CHAI and the Assembly to justify the removal of documents and to return the said items within a reasonable period of time. I have sympathy for the amendment, but the powers under the clause are very similar to those provided to the National Care Standards Commission in Sections 31 and 32 of the Care Standards Act 2000.
I want to make it clear that we do not envisage that the provisions will entail removing vast quantities of documents from sites that CHAI inspects. We also believe that CHAI, should it feel a legitimate need to do so, will normally obtain any additional information that it may want to remove from the premises by agreement. However, the power to remove original material may be necessary where inspectors suspect tampering of data for fraudulent purposes, for example. It emerged in the Shipman inquiry that there had been a considerable tampering of records. In such situations, it is right that individuals acting on CHAI's behalf are able to remove such material for examination without first having to supply promptly a statement of reasons. So that care providers can continue their day to day operations, they will of course be free to take copies of documents that CHAI intends to remove. We envisage that CHAI will want to conduct its business with minimal interruption to service provision and so would expect it to return documents in their original condition as soon as practicably possible.
Given the sensitivities of the power, and should CHAI not return removed material within a reasonable period of time, the organisation involved
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would of course be entitled to seek judicial review or redress via the Parliamentary Ombudsman. The clause as drafted makes it clear that CHAI has the authority to have access to all relevant information. The amendment, if carried, would dilute the effectiveness of CHAI's review and investigative functions. In the light of those assurances, I hope that the noble Earl, Lord Howe, will be willing to withdraw the amendment.
Earl Howe: It is not much of a dilution of CHAI's investigative function to say that someone whose property has been taken away should be able to ask CHAI why it has held on to it for an unconscionable length of time.
The Minister slightly over-eggs his case. He says that judicial review or redress by the ombudsman are remedies available to those affected. I simply point out, as I have before, that judicial review is a terribly heavy-handed and expensive procedure. It is also not necessarily very speedy. One could say the same of redress by the ombudsman.
The proposal I make in the amendment is fairly simple, and does not ask an awful lot. It certainly would not interfere with the rights granted to CHAI and CSCI under these clauses. I am disappointed that the Minister was not more receptive to my proposals, but I do not propose to press the matter now. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 65 agreed to.
Clause 66 [Power to require documents and information etc]:
Earl Howe Earl Howe moved Amendment No. 323:
Page 26, line 8, leave out "(including personal records)"
The noble Earl said: In moving the amendment, I shall speak to Amendments Nos. 324, 358ZB and 358ZC.
The amendments deal with some extremely serious concerns about patient confidentiality. I am experiencing a sense of déjà vu in raising the topic, as my worries are similar to those I raised four years ago in our debates on the health Bill, in relation to the Commission for Health Improvement. Several of us argued, successfully, that the proposed powers for CHAI to access patient data were excessive, and amendments were made that considerably softened the original proposals. I hope that something similar can be agreed on this occasion.
The Bill contains what are, by any standards, wide-ranging powers for new CHAI to access patient records wherever,
"CHAI considers it necessary or expedient".
Nowhere at all is the patient's right to confidentiality even alluded to, nor is any mention made of involving patients in decisions about the use of their personal data.
The GMC has those principles as a central plank of its guidance on confidentiality. Nominally, at least, the Department of Health has also subscribed to them in its draft code of practice. So why these unqualified

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provisions? We all understand about the work that CHAI will do. Some of its investigatory work will be retrospective in nature. Quality assessments involve similar procedures. In those circumstances, obtaining a patient's consent to accessing his records may be a cumbersome and sometimes even impossible task. Nevertheless, there is a very strong argument for insisting that CHAI should use anonymised or aggregated data whenever they will serve its purpose.
If one is trying to compile an assessment of clinical or financial performance, information about individual patients is seldom needed. Anonymised data are sufficient and will become much easier to generate over time, as more records are held electronically. In circumstances in which identifiable records are needed—and there will be some—the answer ought to be that the patient's consent should be obtained. That could be done by way of a suitably worded authority when the patient is being treated in the hospital, to be put by in case of need later. If that cannot be done, personal records should be accessed only for overriding public interest reasons.
The Health and Social Care Act 2001 established the Patient Information Advisory Group as a mechanism for considering circumstances where the public interest is not clear cut and it is not practical to anonymise data or seek patient consent. We would feel a lot easier if the powers of CHAI to access named data without consent were made subject to that legislation. I beg to move.
Lord Clement-Jones: We on these Benches very much welcome a debate on the amendments. However, without recent developments, we would have had more sympathy with them. At one stage, it looked as if the GMC and new CHAI were lining up for a potential clash of the titans, although I do not know whether that is the right way in which to describe Sir Graham Catto and Sir Ian Kennedy—but it looked very much that way.
As the noble Earl, Lord Howe, said, we have had many previous debates on this area—those on the Health and Social Care Bill being one instance, and the previous CHAI debate being another. We on these Benches have been quite consistent. We are not over-ideological about prohibiting use of non-anomymised personal records. The circumstances may differ in which those records can be used, but the essence of the question is, at the end of the day, what is right for patient welfare. Authorities, regulatory or otherwise, need good justification for such access and there need to be proper controls. We were instrumental in agreeing to the new Patient Information Advisory Group set out in Section 61 of the 2001 Act.
In this Bill, there is a difficult balance to maintain. The matter needs to be considered against the backdrop of the kind of powers held by other regulators, such as the Audit Commission, in similar circumstances. I believe that times have changed and that untrammelled right of access to non-anonymised personal records would be wrong in the circumstances that we are discussing. However, CHAI believes that when it is investigating cases such as abuse and serious
1332
service failures it needs that kind of access. On the other hand, the GMC has been vigilant in drawing up its code of confidentiality. Our view on these Benches might have been different if no agreement had been reached between the two bodies. However, it appears to have been reached—I believe that the Nursing and Midwifery Council and the consumers' council have been involved in this—in terms of agreeing that a code of practice should be drawn up which would specify the situations in which CHAI would have access to data relating to individual identifiable patients. The instances in which authorisation would be sought and granted would be specified.
The situation begs a number of questions. These Benches have been briefed by the GMC, as I believe have a number of other noble Lords. A number of issues have been raised. I understand that there is still water to flow under the bridge and clearly we are not there yet. However, it would be extremely useful if the Minister would indicate the kind of circumstances where access would be granted to individual identifiable patient records, and when access would be sought and the mechanisms for scrutinising, authorising and monitoring those requests. The matter is rather more important than simply waiting for a set of regulations to come down the track after the Bill has left this House.
I do not go so far as the noble Earl, Lord Howe, in saying that the Patient Information Advisory Group should be involved, but I believe that there could well be a case for the code of practice to be enshrined in legislation, or for it to become a precondition in this regard. I hope that the Minister will address that matter in his response. This is a serious matter. It is an area where conflicting principles apply. We believe that the two bodies concerned are in the process of achieving a balance but that rather more specificity is required.
7 p.m.
Baroness Cumberlege: I also wish to address the amendment. I have great sympathy with my noble friend's concerns. I wish to comment briefly as I know that time is moving on. I made my maiden speech on patient records. One of the indicators of success of the change in childbirth policy which I pioneered was that pregnant women should hold their own notes. As I have three children and a very diligent GP, my health records are voluminous. When my GP retired, a new GP entered the practice and looked at my notes. He said, "I am very sorry, Julia, I cannot read a word of them". Therefore, my records are completely confidential—that gives me great heart—but I have to say that they are confidential and useless.
The clauses that we are discussing are very worrying. As the noble Lord, Lord Clement-Jones, said, we had long debates on these issues during the passage of the Health and Social Care Bill. The Minister was certainly not a Minister at that time and perhaps did not take part in the debates on that Bill. During the passage of that Bill we had measured, sincere and very passionate debates at every stage. Some noble Lords, myself included, were very nervous that the proposals

1333
would assault the principle of patient confidentiality. Today we face the danger of another move to erode that principle. In no way do I want to insinuate that the motives of those concerned are sinister but I believe that there are serious dangers here which need to be addressed.
I do not want to go over all the arguments that we had previously as I am sure that there will be opportunities to do so later in the passage of this Bill. However, we know that effective medicine depends very much on trust—trust between doctor and patient, between nurse and patient, between healthcare worker and patient but, above all, the trust that the patient has in the NHS; the NHS as an organisation, its systems and its ethics.
Patients reveal the most intimate aspects of their lives, especially when they are at their most vulnerable. It is essential that health professionals have a great deal of knowledge about patients if appropriate care is to be provided but it is understood that that information is confidential and will not be bandied about or disclosed without the patient's consent. One has only to pick up a telephone and try to book something as innocuous as a holiday to be told often by the relevant commercial company, "I warn you that what you say may be disclosed for training purposes". Many such organisations are punctilious in that regard and yet here we are asking people to reveal the most intimate information to health professionals for it to be used by CHAI. CHAI is a body of huge integrity. We have great faith in its new chair and its commissioners but it is an independent body. We do not know what it will be like in time to come. Earlier the Minister described CHAI as the pre-eminent, independent NHS body. It is a very powerful body.
The noble Lord, Lord Clement-Jones, said that there has been much discussion on the matter which I very much appreciate. I am pleased that agreement has been reached but, as I understand it, it is proposed that the use of private patient records should be authorised by a small group of two or three CHAI commissioners. I do not think that is good enough. We ought not to allow CHAI. which wants this information, to be the judge and jury in its own cause. In ordinary law we do not accept that as a good principle. I do not accept what the noble Lord, Lord Clement-Jones, said; that is, that we should not use the organisation that was set up through pressure of your Lordships during the passage of the 2001 Bill. We were very careful to ensure that the Patient Information Advisory Group was well chaired. We chose an extremely eminent person to chair the group, Professor Joan Higgins. Other members of the group were Sir Denis Pereira Gray, who was an adviser to the department, and Sir Cyril Chantler—people of enormous integrity, eminence and common sense.
Lord Hunt of Kings Heath: I bear the scars of the debates that we have had on this matter. Although the noble Baroness is right to testify to the work of the PIAG, is she aware of deep concern among many people involved in research in this country that the PIAG process has resulted in a very bureaucratic
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structure for getting approval? Is the noble Baroness concerned that we are not defining the public interest with the right balance? If this country becomes a difficult place in which to undertake research, we shall defeat the whole object of what we are trying to do.
Baroness Cumberlege: As I understand it, CHAI is interested not in research but in audit. When the Patient Information Advisory Group was set up a number of noble Lords took great interest in determining how it would work and were very impressed with the group's rigour. That ensured that the public interest and (he private personal interest were maintained. From time to time during the course of this Bill the Minister has been generous in agreeing to reconsider certain issues. The matter that we are discussing is of huge national importance. It needs further consideration. Will the Minister consider the points made tonight and revisit some of the very important debates that we had during the passage of the Health and Social Care Bill in 2001?
Lord Warner: Members of the Committee have made extremely important points on a major issue of public policy. I certainly do not want to give any impression that anything in the Bill is an assault on patient confidentiality, which was the term used. I would like to spend a little time reassuring the Committee that we believe that the information about individual patients is rarely needed in considering the general financial or clinical performance of organisations. Therefore, although it will be for CHAI to determine what information is relevant to its inspections, it is our clear expectation-Sir Ian Kennedy has confirmed it—that CHAI should use anonymised or aggregated data wherever that is a practical option and will serve the purpose.
CHAI will, of course, be subject to the Data Protection Act 1998, as is currently the case for the Commission for Health Improvement, the National Care Standards Commission and the Audit Commission. With regard to the duty to inform patients that their records may be subject to inspection, it is part of the fair processing requirements of the Data Protection Act that organisations must make reasonable efforts to inform individuals about how their information is to be used. Those are quite powerful protections for individual patients.
I shall deal with Amendments Nos. 358ZB and 358ZC. It would be a significant fetter on CSCI's independence if it needed to ask the Secretary of State's permission every time it wished to access confidential information. That would also add a delay in accessing any such information, so it would serve to prevent the inspectorate acting quickly to access personal information where that was necessary to protect vulnerable individuals.
We do not propose that CSCI should need to access personal data on a regular basis, and the inspectorate will do so only where it is necessary or expedient. In seeking to ensure the protection of vulnerable adults and children, CSCI may from time to time need to access original data, to ensure that they have not been

1335
altered or tampered with in any way. That is vital in relation to child protection work and the protection of vulnerable adults. From my experience of running a social services department, time can be critical in many such areas.
Members of the Committee are taking the opportunity to ask why the NHS, CHAI and CSCI cannot take steps to ensure that consent procedures are improved or to anonymise records more effectively. Evidence from CHI suggests that seeking consent causes delays and is unlikely to ensure anything like a return of 100 per cent. There are good reasons for that. Some people may consent, some may refuse and some may not reply. The process has to be managed by individual trusts and can cause significant delays on important issues.
Anonymising records is also a time-consuming and complex task requiring careful quality assurance to ensure anonymity. When undertaken on a large scale, it is subject to human error, and in some cases makes demands on hard-pressed clinicians' time. Some issues around anonymity and seeking consent have their own difficulties. I am not arguing the case for not trying to pursue those routes, but trying to set the record straight that they are not always easy solutions when some cases require a timely and speedy intervention.
I sympathise with the concerns of Members of the Committee, but a number of them have said that there have been discussions between the chairmen of CHAI and the GMC. It is worth drawing on some of the evidence of those discussions available to me about the circumstances—several Members of the Committee asked about them—in which the chairman of CHAI envisages the need for having access to data that relate to individual identifiable patients. One example is issues of child protection when there is a need to follow cases across the boundaries between health and social care services—we all know, from some very sad cases that have gone wrong, that some of the boundary issues are pretty critical—and which might involve concerns about parents.
Another area is investigations of serious failures of services, not least in respect of services for particularly vulnerable groups who might not be able to consent— for example, elderly people with severe mental illness, or people with learning disabilities. On audit of economy efficiency and effectiveness in relation to the management of waiting lists, we may need access to the records, as on implementation of NICE guidance. Those are examples from information given to me by the chairman of the Commission for Healthcare Audit and Inspection. I have used them to try to answer some of the questions raised by Members of the Committee.
It is also worth bearing in mind that Clause 134 makes it clear that an employee of CHAI would be committing a criminal offence if he knowingly or recklessly disclosed patient-identifiable information given in confidence. We have made such a provision to support our emphasis on the importance of patient confidentiality, and as a means to reassure the public—and healthcare professionals—that CHAI, in its privileged role, will not abuse its position.
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We should let the work taking place between CHAI and the GMC unfold a little further. They are working towards a code of practice that will strike the right balance. We need to give them more time, and I am sure that they will come forward with a document that will meet many of the concerns expressed.
Several Members of the Committee have raised the subject of the Patient Information Advisory Group. Unlike my noble friend Lord Hunt, I do not bear the scars of the discussions on that; no doubt in a few years' time I shall be talking about scars in relation to this Bill. We are pretty confident—the chairman of CHAI will read Hansard on the subject—that CHAI will consult the Patient Information Advisory Group, among others, as a code of practice evolves from the work that CHAI is doing with the GMC. CHAI will be aware of the work done by noble Lords in this House on an earlier Bill. I assure the noble Baroness, Lady Cumberlege, that I will carefully read the earlier debates to inform myself better before Report.
In those circumstances, I hope that the Committee is reassured that the Government take the issue very seriously. A difficult balance is to be struck, as said by the noble Lord, Lord Clement-Jones, but the right way to proceed is to let the work on the code of practice between CHAI and the GMC continue, rather than pursuing the route of an amendment to the legislation at this stage.
7.15 p.m.
Lord Clement-Jones: The noble Lord has been very helpful in terms of giving some examples of circumstances in which personal information that has not been anonymised might be needed. I think that he gave four examples. He also talked further about the code of practice. However, what is the timing of that code? Even for those of us who recognise that a balance needs to be struck, that there are circumstances in which consent is not possible, and that the Patient Information Advisory Group is the right mechanism, a bit of expedition would not go amiss. It would enable us on Report to at least have something rather more concrete.
Lord Warner: I am very happy to take soundings from the two titans, as the noble Lord called them earlier. Given all the discussions that we have had about the independence of CHAI, I am sure that he would not want me to be terribly heavy-handed, or I should be accused of the Secretary of State interfering unnecessarily. I understand his concerns, will make inquiries, and will write to all Members of the Committee when I have some better information on the time scales involved.
Baroness Cumberlege: I thank the Minister for his reply. It was disappointing for me in that I had hoped that the noble Lord would go further. I accept, as do all noble Lords, that confidentiality is not an absolute. There will be circumstances, which the Minister has illustrated, where there is a strong public interest and disclosure is necessary. The matter that worries me is that we do not seem to have a good process for dealing

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with that situation. The Minister mentioned the code. I am not sure exactly how we have an influence on that code.
We have described the two titans. Where is the referee? How can we. noble Lords who are very concerned about this, influence that code? I am frightened that the matter will be decided between the organisations involved. We may have a different perspective. Indeed, we did last time. If the mechanism that I have suggested is not the right one, I hope that the Minister will come back with not just a code—that is too loose-but with something that we can be certain is independent and, yes, quick, fast and resolute. Simply to say that it will be inconvenient and irksome to have a delay is not good enough. We can surely devise a mechanism that fits the needs here, but is not as loose as a code over which we have no control.
Baroness Carnegy of Lour: Putting the matter another way, is the Minister convinced that he will be able to continue to certify that these clauses are compatible with the European Convention on Human Rights, when the so far unknown code is in existence? He has certified that these two clauses satisfy the convention. That is surprising, and depends on good legal advice. The code will presumably affect the way in which the clause operates. How will he be sure that he can certify the Bill once the code appears?
Lord Warner: We can do so because on good legal advice the Government have certified that the Bill as presently drafted conforms with the Human Rights Act. The code of practice that we are discussing will be, so to speak, belt and braces. We will go further than the legislation as presently drafted. That will certainly make the situation better. We believe that there are sufficient safeguards in the Bill, but we are also saying that we understand peoples' concerns and nervousness, and we are pleased that CHAI and the GMC are working on the code of practice. We are confident that the code will produce further safeguards to reassure people in this House.
Baroness Cumberlege: How are we going to see the code?
Lord Warner: We have had many discussions about heavy-handed government interference with independent inspectors. Under the current process, the General Medical Council, which is the self-regulation body for the medical profession, is discussing with the chairman and staff of the new body the arrangements for a code of practice. We need to let that process take place in a sensible manner without interference from government. That is not the objective that noble Lords have been saying that they want to happen in relation to CHAI. I promise to write to noble Lords about the time scale involved. I shall do that as quickly as I can—but we do need to let that process take place.
Earl Howe: I felt that the Minister's opening remarks did justice to the gravity of the issue. I was less happy with the way that he carried on in his reply. I
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thank my noble friend Lady Cumberlege for the robust stance that she has taken, with which I completely identify. I am also grateful to the noble Lord, Lord Clement-Jones, because we do not always see eye to eye on these issues. He made some extremely helpful proposals. He is right. There are conflicting principles at work and there is a balance to be struck. But it must be a balance that is protected by a robust framework of safeguards.
Of course I was aware that the chairman of the two titans have been engaged in discussions in recent days. That is a welcome development. However, we need to see the fruits of those discussions. It is easy for the Minister to say that we are urging the Government to give CHAI the maximum independence, and suddenly we are asking to second-guess CHAI. We are dealing with an issue that is of a completely different order. It is indeed an issue of national importance and Parliament does have a legitimate role in the matter.
My noble friend Lady Cumberlege was right—there is in a doctor and patient relationship an inherent degree of the utmost trust. It is not reasonable that a patient should not know that his or her personal records are being disclosed or used for a CHAI investigation, other than in the most exceptional circumstances. It is also not fair on staff to ask them to breach the principles enshrined in the Data Protection Act without providing them with legal and ethical cover. Doctors and nurses are in a very privileged position.
I note the Minister's comments about it being a relatively rare occurrence for CSCI to want to gain access to personal data. In that event asking for consent to gain access should not be a problem. If such consent causes delay, we should say that that is just tough. The delay need not be more than an hour or two in most circumstances if the situation is urgent. I do not buy the argument that the Minister put forward in that context. Again I am grateful to my noble friend Lady Cumberlege for her comments on the matter.
The Minister seemed rather too ready—I do not wish to underline this too many times—to allow this type of information to be sprayed around on too liberal a basis. We have to resist that. If a protocol emerges from this process of discussion between the two chairmen, at the very least that there should be a role for independent persons, apart from CHAI. to adjudicate on the matter. It is not enough for the decision to be taken in-house. I believe that the matter is under discussion.
Lord Warner: I wonder if it would help the noble Earl and others here to say that, given the strength of feeling on this issue across all sides of the House, I undertake to consider it further. I would like to do that in consultation with the chairmen of CHAI and the GMC. I take the noble Earl's point, as will they, about having an independent review. I will look at the wording of the Bill and after those discussions 1 will continue to give noble Lords an update on the lime-scales that are involved over the code of practice. I shall return on Report with further thoughts, if we have them, on how to take the matter forward in a way

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that will be satisfactory to opinion across all sides of the House. I emphasise that I do not underestimate the strength of feeling on this issue, and it is a matter of important public policy that we have to get right.
Earl Howe: I greatly welcome the Minister's offer and his willingness to take away the concerns that have been aired today. I am grateful to him for responding so positively. There is little more we can do now to enlarge on these important issues. Clearly, we will need to return to them at a later stage. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 324 not moved.]
Baroness Andrews: I beg to move that the House be now resumed. In moving the Motion, I suggest that the Committee stage should begin again not before 8.30 p.m.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.

Railways
7.30 p.m.
Lord Berkeley Lord Berkeley rose to ask Her Majesty's Government whether the quality and effectiveness of the United Kingdom's railways are satisfactory.
The noble Lord said: My Lords, I am grateful for the opportunity to discuss today the quality and effectiveness of our railways. First, I declare an interest as chairman of the Rail Freight Group.
It is an opportune moment to talk about railways: the Government are in the middle of reviewing their 10-year plan for transport; the Comprehensive Spending Review is coming up next year; and last Friday the Rail Regulator made a significant statement about his interim review of Network Rail's track access charges. Perhaps now is an opportune moment to ask what the railways are for and what will be their role in the future; say, in 50 years' time. We are in good company, as the transport committee in another place is also considering the subject.
Will there be a role for railways in 50 years' time? It is reasonable to assume that our quality of life will continue to improve together with our desire for mobility, our acceptance of the need for respect for the environment, and the continuing decline in our manufacturing industries. That means that we will be importing more. Lloyd's List for 16th October showed that container demand has doubled in just eight years. Furthermore, the major shipping line, Maersk, expects imports by container at least to treble in the next 20 years. Will that trend continue and, if not, why not?
We expect mobility, but while wishing to have the benefits of it more and more, we prefer roads, airports and new railway lines to be located in somebody else's
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back yard. So now is the time for choice. Do we stick with the railways or do we change direction and base our future on roads and air, for example?
I believe that we should consider the following issues. All freight could go by road. In particular, will we be able to move all the goods from our ports by road when there is already severe land-side congestion? I believe that at Southampton there is a six-hour delay, with lorries queuing to get in and out of the port. Is it conceivable that no one will commute by train? What if all business and leisure travel was by air or car? How many more runways would we need and at what cost of air and noise pollution? What will the effect of road-user charging be on rail?
Apart from rail being safer than road, rail traffic can be controlled to give priority to those who need it most—for example, freight and public transport— unlike road, where whatever new roads are built, lorries often get little benefit as the roads fill up with cars. So I believe that the railways are here to stay, to grow in usefulness and efficiency. Closing parts of the network cannot be an option for any government looking long-term at the country's transport needs.
The key is to provide both the economic as well as the political environment for them to grow and prosper, as was originally set out in the 10-year plan. This is something that the industry and government must do urgently and continuously over a long period.
The rail industry must get its costs down. Thanks to the privatisation structure and the get-rich-quick attitude of Railtrack, the railways are now bogged down in bureaucracy; trains go slower with more delay; and, surprisingly to some, Railtrack spends even less on maintaining the network than BR did. Management of the industry has left much to be desired. How can we be in a situation of having hundreds of new trains sitting in the sidings south of the Thames to replace the Mark I rolling stock because no one realised that new trains needed more current? That is now being put right at a cost of £1 billion while the trains sit in the sidings and we clatter around on the old Mark Is. They are very nice but it is an incredible waste of money.
But with Network Rail, with the Railway Standards and Safety Board and the Railway Accident Investigation Branch, and with some hefty pressure from the Rail Regulator, there is evidence that things are beginning to improve. Network Rail is taking maintenance back in-house in many areas. That is indicative that not only will the costs fall but that it will take full responsibility for what happens. After recent events on the London Underground, I am sure that that is a good idea.
Moreover, two or three years ago, the cost estimate for increasing the gauge between Southampton and the West Midlands to take containers from a new port in Dibden Bay was £900 million. That has fallen to £40 million, which shows that realism is taking hold in the railways. There are ideas for micro-franchising in branch lines, with local companies maintaining the track at a fraction of the cost that Railtrack levied.
However, government also have their part to pay. They must discourage the safety hysteria that has gripped the industry. It started with privatisation as a reaction to private profit creating what was perceived to be a less-safe railway. Things have moved on since then, but most of the railways accept that freight is now under government control and finance. The idea still remains that the hysteria must somehow carry on.
If Ministers never want to see another railway accident, they had better put a man with a red flag in front of every train, close the system down or provide money for gold-plating -and even then there will be an accident, the same as there is on any transport system. Alternatively, they can become more realistic—as I hope they will. The Minister of Transport, Dr Kim Howells, did a great service to the cause of common sense when in August he said that accidents will happen on any transport system, while noting that an average of 10 people are killed on the roads every day. I urge the Minister to carry on with such comments and actively pursue policies of treating rail and road in the same manner. This includes the role of the Health and Safety Executive.
Rail accidents have rightly or wrongly attracted criminal proceedings. A piece in today's Financial Times states:
"Law still weak on companies that kill people".
There is a half-page spread, explaining how 10, 20 or 30 high-powered lawyers sit in a court room in Luton. Noble Lords can read it in the Library, if they want to. However, there no one is asking about the county council which removed a bridge over a railway line in Huntingdon 25 years ago without putting up a sign until a driver went over it one foggy night and was killed because a train ran into his car. Are they not just as culpable as companies? There must be one law for everyone.
I turn to the present. The Rail Regulator has published his draft final conclusions, which confirm that Network Rail must keep the network open and maintained to the current standards. That could save a great deal of money in certain areas, both in the management of contracts, undertaking work more efficiently and not undertaking work that is not necessary. It is clear that money must be saved by maintaining the mainlines more effectively, as the Rail Regulator has demonstrated, because closing secondary lines will have minimal effect on the finances as they receive little maintenance in any event, and it will have a major effect on the future network.
More money from the SRA and the Government will be needed than they appear to think necessary, but I urge them to be reasonable and to give Network Rail time. Let us recall that it has been in existence for only one year. I know from talking to many of the senior people that they did not have access to any of the information that Railtrack had about the quality of their network. If one looks at what they have done in a year, one can see how much change is likely to come in the next year or two.
I recently had the privilege of going on Network Rail's measurement train and I am hoping to arrange a visit for the All Party Group. It indicates which bit of the track needs maintenance and when. That saves an enormous amount of money.
Therefore, the key is for the regulator to keep up the pressure on Network Rail to deliver and reduce costs. But if the work is not done when it is required, there is a serious risk that the network will degrade and that structural failures will occur, leading to prolonged or permanent closures, as well as, obviously, a worse service.
In conclusion, I plead for time for the railways. I also plead for the Government to continue to reinforce their message of getting rid of red tape and unnecessary rules and threats and of treating road and rail as complementary transport systems with similar safety, regulatory and financial needs. Then they should certainly put pressure on the rail industry to deliver. At that point. I believe that industry can start to create a rail network of which our successors can be proud in 50 years' time.
7.40 p.m.
Lord Bradshaw: My Lords, first, I congratulate the noble Lord, Lord Berkeley, on obtaining this debate. I say to the Minister that Labour has now been in office for six years. While it cannot be blamed for privatisation, it can certainly be blamed for the huge and ineffectual growth in bureaucracy.
We are in danger of making some of the mistakes that Dr Beeching made. He believed that sufficient costs could be saved by cutting the secondary railway—when it was near to the centre that large sums were to be had. We are again in danger of subventing hugely expensive organisations, such as the Strategic Rail Authority, the rail regulator, the Health and Safety Executive, which, incidentally, I believe wants more money, and all their acolyte consultants, advisers and contractors, while the secondary railway is threatened. I suggest that each line of the secondary railway could be saved for the cost of a few weeks' consultancy.
We must also avoid using the old canard about decades of under-investment. The railway prior to privatisation was serviceable and the West Coast Main Line had no speed restrictions.
I want to ask the Minister what the Government are doing to take the axe to the leeches on the railway. For example, do we need an expanded railways directorate in the Department of Transport, as well as an ever-expanding Strategic Rail Authority? What would we suggest? We suggest a few long franchises, which would include track, signals and timetables. They would last for 20 years and depend only on improved performance. That would give scope for planning and investment. I venture to suggest that two-year extensions and five-year franchises do not do so. The time the Strategic Rail Authority takes to let a franchise is far too long and the costs to both the Strategic Rail Authority and the bidders are far too high, with most of the money going to our legal

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friends. We would abolish the regulator, and open access for passenger operators would be done away with. But we would have—I hope that the noble Lord, Lord Berkeley, is pleased about this—a single-point adjudicator to protect freight interests.
We need an efficient railway, such as the Swiss have—particularly as, inevitably, road congestion will get worse. At present, we are getting more bureaucrats, more advisers, more consultants, more contractors and more sub-contractors, and, I venture to suggest, a very ailing railway.
7.44 p.m.
Lord Faulkner of Worcester: My Lords, I, too, congratulate my noble friend Lord Berkeley on securing this debate. I say to the usual channels that I wish we had more time to debate the railways properly. Perhaps that can be considered for the new Session.
The question that I want to address in the few minutes available is whether the railway is moving in the right direction. I believe that it is because the leaders of the industry—the SRA, Network Rail, the regulator, the TOCs and the freight companies—are now broadly pulling in the same direction.
Despite the huge problems created by a decade of under-investment and the catastrophic response of Railtrack to the Hatfield accident, so vividly described again by Tom Winsor last week, the railway is in far better shape than the media portray it to be.
The Times reminded us last month that:
'The total distance travelled by train rose by 2 per cent to the highest level since the Second World War. The number of train journeys reached 975 million last year, and is expected to exceed one billion this year".
The benefits of having a decent, popular and affordable railway go far beyond the people who use it. Because so many journeys and freight movements are in key corridors or are taken by people going to and from work or travelling from city to city, the absence of the railway would have a horrendous effect on road congestion and on the quality of life in our towns and cities.
I ask noble Lords to imagine what life would be like if 75 per cent of solid fuel were not carried on the rails, if the commuter railways in our big cities did not exist or even if 55 per cent of all journeys between Newcastle and Manchester were not made by train—an extraordinarily high statistic. To those who argue that we need a much smaller railway—a new Beeching to slash the size of the network—I say: look at the facts.
Despite the difficulties of recent years, rail passenger journeys are up by a third and rail freight by 50 per cent since 1995. How ironic it is that the route described by the Select Committee in another place as having the worst overcrowding turns out to be the North London Line—the entire closure of which was proposed by Beeching. The town of Mansfield lost its railway in the 1960s but is now on a 32-mile new route from Nottingham, on which demand is growing by 15 per cent a year. The Settle to Carlisle line, reprieved from closure by Michael Portillo, is now undergoing a £3.2
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million upgrade. Closures are not the answer. The solution to overcrowding is investment in new lines, new stations and new rolling stock.
As the demand for travel grows, only the railway can provide a socially and environmentally acceptable mode of transport. If we are serious about meeting our international commitments on greenhouse gas carbon dioxide emissions, road traffic growth and worsening congestion must be addressed. Therefore, I welcome reports that the Government are planning a switch to road-user charging. I hope we shall hear by the end of the year that they will adopt a demand-management approach to air travel, too, and resist the demands of the airline lobby on airport expansion.
At the same time, as my noble friend said, the railway deserves much greater credit for its safety record—certainly compared with the roads, on which a car driver is six times more likely to be killed on every passenger-kilometre travelled. More people are killed on the roads every day than on the railway in an average year. And the railway is becoming safer because, unlike in the case of road accidents, every time there is a serious incident on the railway, lessons are learnt and improvements made.
For the first time since privatisation, I believe that the railway is now in competent hands and deserves to be given the opportunity and the support to show what it can do.
7.48 p.m.
The Earl of Mar and Kellie: My Lords, I hope to raise some issues around franchising and the national railway in Scotland.
When thinking about railway franchises, at least three features are worth highlighting. At present, the fundamental point is that they are generally too short. That has a significant effect on training, on maintenance and development and on re-equipping. My presumption is that, to make the most of a franchise, a substantial period of time is required; otherwise, a short period will produce no more than another couple of years of the same. And why not, when railway equipment generally lasts for 40 years?
To support my argument, I believe that we should consider the ScotRail franchise process. Initially, with 20 years on offer, there was interest from United Kingdom companies, as well as rail operators from Denmark, France, Holland and Germany. Consequent to the reduction of the franchise length to less than 10 years, only the three UK operators are still interested—that is, National Express, which is the incumbent, Arriva and First Group.
On these Benches we believe in rolling franchises. The franchise continues, provided that standards and expectations are met. I believe that that would be good for staff training, good for development of an entrepreneurial nature and good for new equipment.
Turning to Scotland and its railway network, it must be viewed as a national railway and not as a regional network, especially as the latter tends to be shorthand for a peripheral and unimportant system. That is not just a political point to keep up with the SNP, which

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does not trouble the Government in this House, but it reflects the fact that the franchise process is devolved. Scotland can choose to have a distinct national passenger railway by determining the level of subsidy that is to be invested in the system. It is inevitable that subsidy is needed in Scotland and the Scottish Parliament must decide, as a quality issue, how much. I look forward to the conclusion of the franchise award.
Now I want to complain about Network Rail and the Strategic Rail Authority, which are not devolved, and in particular about the downgrading of all Scottish main lines to major secondary route status and the subsequent withdrawal of investment. The East and West Coast Main Lines have not been downgraded, but the Scottish sections will not be very exciting.
So the future in Scotland seems to go like this: the new Scottish franchisee can develop the passenger railway service in Scotland provided it does not need improved tracks, signalling and stations. Is that really the United Kingdom Government's intention?
7.51 p.m.
Lord Palmer: My Lords, I, too, thank the noble Lord, Lord Berkeley, for asking this most timely question and for his superb introduction. I am a frequent traveller on GNER, whose chief executive is a distant cousin of mine. Along with other noble Lords, I greatly welcome Jarvis's retirement, although I am amazed to see that the contract was worth only £180 million per annum.
When we last debated railways almost exactly two years ago, I started my speech by saying that the railway industry in this country was in a terrible muddle and mess, and it is sad to note that the situation has not greatly changed since then. Ask commuters what they think of our railways and the likelihood is they will say that if anything, matters have got worse. If we really want people off the roads (which I believe passionately that we do), we must have a reliable and safe railway network, and it is the Government's job to ensure that the industry is properly financed. I still believe that the industry is surrounded by far too much uncertainty; franchises ought to be renewed for a minimum of 10 years, particularly if one is to expect train operators to invest their money into the system. I believe that franchise re-bidding is extremely harmful to the industry, as it creates uncertainty for staff at all levels.
I cannot imagine that there are other European rail networks still running with 25 year old diesel locomotives, most of which under the present situation are expected to last another five years. On the GNER line, which has one of the better punctuality records of our railway operators, there is still a horrific backlog of maintenance required, particularly with the quality of the overhead wires. The slightest gust of wind seems often to bring the east coast line to a grinding halt, and I hope that there will be sufficient sums available to Network Rail to speed up the overhaul of the overhead wires.
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For some extraordinary reason, the passenger train companies have agreed that return tickets cannot be valid for more than a month and I do not understand the logic behind this. Prior to privatisation, tickets were valid for three months. Why cannot passenger train operating companies revert to that system?
Parking at some stations is a problem, particularly at Berwick-upon-Tweed. It has become impossible and only a month ago I got the last empty space. Had I not, I would have had to go further into the town, no doubt missed my train, and would have had to buy a brand new rail ticket. I believe that Her Majesty's Government must revisit station parking as a matter of urgency, as to get the infrastructure correct is a vital component to the success of our railway network.
And what is the lot of the hapless railway commuter? On a twice-daily basis they face appalling conditions: lack of cleanliness; chronic overcrowding: lack of any security and minimal staffing of stations. What a way to treat them! If such conditions were endured by livestock the country would be up in arms.
I believe that there is a great future for our railways. It needs the right level of commitment and a great deal of common sense from the Government. I urge them to take this chance to grasp the problems facing the industry. Being such a tiny country in geographic terms, we ought to be able to run the best railway system in the world, and I hope that the Government will give our railways their full backing.
7.55 p.m.
Lord Methuen: My Lords, I too am grateful to the noble Lord, Lord Berkeley, for asking this Question about the quality and effectiveness of our railways. There was a time when our railways were the envy of the world. Now we lag behind our European counterparts without any significant high speed railway lines, although we have the beginnings with the opening of the first phase of the Channel Tunnel rail link last month.
Investment is there. The noble Lord, Lord Berkeley, and myself visited the Virgin training centre in Crewe where we were allowed to play on their £2.5 million simulators. It was very stimulating to see the type of equipment and training that is now available to Virgin's drivers.
We have to understand what we want from our total transport system, let alone what we can afford. We have to take a broad view of both road and rail transport, comparing them on an equal basis for both passenger and freight movements. Even in the 1930s the railways were complaining about the unfair treatment vis-à-vis the road traffic industry. Our objective must surely be to provide a transport system that, where practical, gets people out of their cars and on to public transport. Congestion charging must play a part in that.
But we need railways that are affordable and adequately safe. The European train management system is the ultimate aim for the high speed and densely trafficked lines, but it is surely not cost effective even on the lesser branch lines. For those we

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need a lower cost but adequate standard of safety and local control and promulgation of their services, as mentioned by the noble Lord, Lord Berkeley. We are seeing signs of that happening in the North East where the North Yorkshire Moors railway might take over the maintenance of the Whitby to Middlesbrough railway.
However, our main problems lie in our conurbations and motorways. I quote from a yet to be published report which states that charging for using our roads in both those circumstances, although it may be unpopular, provides a very large new potential market for public transport users, which in turn may tip the investment balance substantially in favour of public transport of whatever type. In that scenario rail transport has to show that it offers value for money. I look forward to hearing the Minister's response.
7.58 p.m.
Lord Sawyer: My Lords, I thank the noble Lord, Lord Berkeley, for introducing the debate. In the short time available to me I want to say something about people. Since the industry was privatised—some 20 private companies now run the majority of the industry—too much time has been spent concentrating on profit and not enough time spent concentrating on people, although the industry employs 40,000 to 50,000 people.
Paradoxically, if the companies spent more time on people—employees and customers—profits might be easier to earn. I believe that the approach of the industry to people is basically—although not universally—a continuation of the old British Rail culture that employees are expendable and customers are captive and that therefore we do not need to do anything exceptional in this area to be successful and to make profits. I strongly believe that that is wrong and that in fact the opposite is the truth. In my opinion the sector will succeed only if it makes employee and customer satisfaction its absolute and overriding priority.
Customer satisfaction will come only through employee satisfaction. There is little public evidence that the majority of the rail companies have a highly trained, strongly motivated and highly valued workforce. I think that that is fairly obvious through one's own experience as a customer.
Employees focused on customer service, who themselves felt highly valued and motivated by the business leaders and managers, would provide a service to customers of a standard that most of us rarely witness or experience. I say "rarely", because I have experienced good service. It is wrong to say that it is universally poor, particularly, for example, on GNER as a first-class ticket holder. But that standard of customer service is rare. It should not be rare. It should be the baseline for all customers, including standard-class customers on all lines and not just on some lines and only for first-class customers.
The UK standard for achieving business success through people is the UK Investors in People award. The majority of rail companies are not Investors in
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People qualified. I find that remarkable and would suggest that Mr Richard Barker might consider that all companies that operate or seek to operate a franchise should be holders of the Investors in People standards. After all, that standard now covers more than 40 per cent of British industry. There are no people measures in Mr Barker's strategic plan. The championing of the Investors in People standard would go some way towards rectifying that. As a director of Investors in People, I hope to be able to discuss this matter with Mr Barker, and can assure him that, if he were to travel down that path, many people would be pleased to offer a great deal of assistance.
I also suggest that the SRA should require all companies to conduct an employee and customer satisfaction service on an ongoing six-monthly basis and that the information should be made available to employees and customers. The information would be equal to, if not more important than, the quality and reliability information and the other performance indicators that are already used in this industry. This new kind of information about people that I look for will tell us additional and important information about employees, about how they are managed, how they are valued and what they think about their management. This should also be extended to customers.
By measuring these things and working for improvements with people and customers we shall see a real change in culture and an improved travelling experience.
8.2 p.m.
Lord Lea of Crondall: My Lords, I am able to speak for four minutes because I had my name down, but I think it was omitted inadvertently from the list. The good news is that I think there is time in hand.
This debate is particularly well timed. The debate in the country on transport is now crystallising in a very exciting way. The key to this is the terms of competition for road/rail market share in the areas of maximum congestion; that is, the big conurbations and the intercity flows.
It is hard to remember a time, however, when such totally contradictory conclusions can be adduced from the same information. It is true that the input/output of railway performance has deteriorated for a host of reasons, some of them regulatory, some engineering in a broad sense and some management. Nothing I say is meant to detract from the performance to cost agenda facing the industry.
Given all that, we can now see a strategy for a new political economy of transport which starts with the fact that, in a nutshell, we cannot choke off both rail and road at the same time. If choking off some road growth is inescapable—which it is—we cannot also choke off rail growth. That would be stupid. We have to provide for rail growth in the key conurbations and medium distance; that is, leaving out of the equation, just for the moment, the distances where the airlines are part of the equation.

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So the picture presented is one of an urgent need to use market principles of marginal costs—I emphasis "marginal costs". Marginal costs determine behaviour. The marginal cost of road transport in congested areas must go up; the marginal cost of rail transport must go down, or at least not go up. Otherwise, there would be a contradiction. We must be logical about the matter.
Rail capacity must be there or choking off road would lead to an impossible political economy equation. One reason why the political economy of transport has not been working is that we have the obvious paradox that the majority of investment for public transport—mainly railways—is now intended to be private finance, but the majority of the investment for private transport—mainly roads—is actually public finance. That is what gives a typical Treasury official a headache, if not a nervous breakdown. What he or she sees is a demand for more cash to go down a black hole, whereas in fact the Treasury revenue on the road side has yet to come in and transform the marginal cost of journeys, so that the externalities of congestion and environmental impact produce a new equation where there is growth of demand for rail transport. In my opinion, it does not matter whether it is hypothecated finance, but the political economy, as I say, is that the market would produce that switch.
We know of the extreme difficulty of the politics of this, but I give one figure. A charge which produced a 5 per cent reduction in road traffic could increase by 50 per cent the demand for public transport. So this turns on its head the usual objection that the increase of public transport will not take up more than one year's traffic growth on the roads. That spectacularly misses the point.
We have to look at the timescales of this because it is a very challenging task to get A done before B, unless someone is going to say you cannot do B because you have not yet done A. It is a question of the charge versus the creation of the capacity on the public rail transport. We need to roll forward the 10-year plan. The fact is that the framework has materially improved the quality of the analysis. I hope that my noble friend will take on board the fact that the all-party parliamentary group on railways will shortly publish some quite outstanding analysis on this whole question by Professor Phil Goodwin of University College London, and we shall be commending his report to everyone with an interest in these matters when it is published in a couple of weeks' time.
8.7 p.m.
Baroness Scott of Needham Market: My Lords, as ever it has been an interesting and constructive debate with contributions from noble Lords with some years of experience in transport. In summing up from these Benches, I thank the noble Lord, Lord Berkeley, for initiating the debate. Perhaps I may say at the outset how refreshing it was to hear someone speak of transport planning in a 50-year time-scale in an age in
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which we are lucky if we can get the delivery agencies to look five years ahead, and in which junior transport Ministers change annually.
As we have heard from various noble Lords, there are serious problems in the industry. My noble friend Lord Bradshaw and the noble Lord, Lord Berkeley, both referred to fragmentation of decision-making in the industry, to which I shall return. My noble friend Lord Mar and Kellie and the noble Lord, Lord Palmer, talked about the problems brought about by short-term franchises.
However, declaring an interest as chair of the LGA transport executive, I shall concentrate my closing remarks on the local and regional dimension to rail services. It is vital that we remember that a significant proportion of the 3 million passengers carried by rail every day travel on our regional network. The effect in certain areas is significant. In Strathclyde, for example, 25 per cent of all commuters enter by train. I am told that the Wharfdale Line carries an amazing three-quarters of those entering Leeds to work. Without the Trans-Pennine Express, the nearby motorway network would become impossibly congested. The noble Lord, Lord Faulkner of Worcester, gave other examples in which that is the case. It is certainly true that rail is playing an increasingly important role in access to airports; one has only to consider Manchester and Birmingham to understand how important it is and how good it can be when done properly.
The danger of an approach that considers rail purely from the point of view of input without considering wider outputs such as relief of congestion, economic regeneration and accessibility is that from that end of the telescope, local and regional services start to look unattractive. That means that they suffer from lack of investment, which further undermines the routes and sets in a general spiral of decline.
When decisions are being made far away from the places to which they relate, such issues receive far less attention than they merit. Rail links viewed centrally are a cost to be minimised; viewed regionally, they are a vital part of the economic and social life of an area.
I see no reason why rail should still be under centralised control. The UK is now the only country of any size in Europe that organises its rail services in that way. Most countries now have some sort of devolved funding mechanism that works across the whole country. As we have heard from my noble friend Lord Mar and Kellie, we have devolved spending, at least in Scotland. He made well the point that viewed from the SRA in London, Scotland is a regional network, but that viewed from the decision-makers in Edinburgh, it is a national one, which means that it receives the importance it deserves.
I was pleased to hear my noble friend Lord Methuen and the noble Lord, Lord Berkeley, talk about micro-franchising. There is no reason why we must have a "one size fits all" approach. We can innovate and experiment.

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The time for arguing about the merits of privatisation has long gone. As my noble friend Lord Bradshaw said, we are now beyond having to make the case for increased investment. As I am sure that the Minister will say in his reply, money is entering the system. The question is whether we have the structure in our railway to spend it effectively. We have a rail section within the Department of Transport and the SRA. Why do we need them both? A cynic could say that the SRA exists only to provide a safety cushion between Ministers and an angry public. Do we need the Strategic Rail Authority, Network Rail and a regulator?
Tens of thousands of people are making reliable and safe journeys every day on the railways and are served by dedicated staff. The problems are not with them, or even necessarily with the contractors; the problem is with the structure and the culture of blame, bureaucracy and buck-passing that has developed because of it. That is what we need urgently to address.
8.12 p.m.
Viscount Astor: My Lords, this debate is timely because it follows the House of Commons Transport Select Committee report on overcrowding and last week's announcement by Tom Winsor, the rail regulator.
The Government published a 10-year plan for transport. It is an odd plan. It is reviewed each year; targets are tinkered with and reduced or increased as the mood suits. It is not actually a 10-year plan at all; it is a work in progress—some might say a rough draft— because not a single major objective looks as though it will be met. Nor, indeed, are there any signs that any of the key indicators set out in the plan are moving in the right direction; most are moving in the wrong direction.
Privatisation of the railways was an improvement. I stand by that claim. British Rail had been underfunded by governments over many years. Consider the increase in passenger numbers; consider the huge investment made by the train operating companies in new rolling stock. Some train companies are now net contributors to the Treasury. None of that could have happened under the old British Rail. But let me say again, as I have said before: I accept that we did not get it all right. The interface between the train operating companies and Railtrack did not work well. Sadly, when that became apparent early in the Government's tenure, they chose to ignore the problem until it was too late.
We admit our mistakes, unlike this Government, which, rather than make improvements, chose to destroy and re-nationalise to suit their political motives. They did not heed the advice of the rail regulator. I quote Tom Winsor:
"Stephen Byers made matters worse by putting Railtrack into administration. At that point cost control went out of the window …I think that Mr Byers should not have acted as he did".
He also said:
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"Network Rail lacks basic railway skills and is still guilty of excessive caution in its handling of track repairs".
So trains run even later and are even less reliable, and the Government are now cheating by allowing train operating companies to add 30 to 40 minutes to many timetables to make it seem that trains now run on time.
Is the Minister proud of that? Is it an honest or effective way to run a railway? I look forward to his explanation. No doubt that interesting sleight of hand on timetables will allow the Minister to claim a huge improvement. Try telling that to the poor, long-suffering passengers.
Will the Government fund the £22.7 billion that the rail regulator claims is required? If so, how?
As has been mentioned, the train operators suffer from one problem that could be easily rectified: increasing the length of the franchises. How can they plan for the future?
Furthermore, how can the train operating companies invest in new electric-operated trains when it is clear that, by going electric, with new faster trains, there will not be enough power—electricity—available to run all the trains? What will the Government do about that? Who is responsible?
Are the Government and Network Rail committed to upgrading the whole West Coast Main Line? If so, what will be the timetable? Network Rail refers in its 2002 annual report and accounts to the,
"fundamental uncertainty of the West Coast Route".
The rail regulator's view is that, if Network Rail does not get its act together, he is willing to pull the plug on the project. But that is not the view of Richard Bowker, the Strategic Rail Authority chairman, who opposes any delay. What is the Government's view?
In the 2002 Department for Transport report the Government claimed that Network Rail would offer many advantages over Railtrack. Let me quote a few. On page 42 it refers to,
"an alignment of the operations and incentives with the wider public interest".
Can the Minister give us an example? It also claims that there will be,
"a reinvestment of surpluses earned on operations back into the rail industry".
When do they expect the first surplus to appear for reinvestment? Finally, it refers to,
"more efficient financing through a strong capital structure offering a lower cost of capital".
How much has been saved?
The department's 2003 report failed to address any of those issues. So the Minister has an opportunity to set the record straight today.
Also, why do we need the three overlapping competing regulators—the Strategic Rail Authority, the Office of Rail Regulation and Network Rail? We would support the Government, if they come forward with a sensible plan to rationalise those bodies.
8.16 p.m.
Lord Davies of Oldham: My Lords, we have had a most interesting and constructive debate. It was ably introduced by my noble friend Lord Berkeley, whose great expertise in the field set the theme that infused all the contributions; namely, a commitment to the development of the rail service and to dealing with anxieties where it has failed to live up to expectations.
I note the noble Viscount's remarks at the end of his speech. For a party that continually tells us how much it will save on public expenditure, here is yet another plea for necessary expenditure. The party recognises that substantial sums are being mooted as essential for the development of the system and merely asks us how we intend to finance it. The noble Viscount will know that current demands possess an external quality. We will look at overall financing of the railways. But he will also recognise that the Government have already made a substantial commitment to railways investment.
I recognise that the noble Lord, Lord Methuen, the noble Earl. Lord Mar and Kellie, and my noble friend Lord Lea all advocated development of the railway. They expressed concern that it did not meet every expectation. All their contributions were positive. I recognise, in particular, the important points made by the noble Baroness, Lady Scott, and my noble friend Lord Lea that we must look at the externalities with regard to the cost of rail. We should recognise that transport must be looked at in terms of costs and investment.
We recognise, as does the country, that under-investment in railways will merely result in increased journeys on an already overloaded roads network. We need to get the balance right. But, in response to pleas to reduce bureaucracy, I make the obvious point that we are not about to shake up the structures concerned with investment and development, monitoring and guarantees for railways. We have far more urgent issues to deal with. There are far more crucial decisions to take than the question of the bureaucracy of railways administration.
The noble Viscount was honest enough to say that this Government inherited a botched privatisation. They inherited, not only botched privatisation, but a network that had been starved of long-term investment. This Government are committed to that investment. We do not have time to involve ourselves in fanciful concepts. I notice that the Liberal Democrats are once again engaging in their general theme of devolution of everything that can be devolved. There are many things that ought not to be devolved. However, we do not have time to look at how we may devolve greater structures with regard to rail. The noble Earl, Lord Mar and Kellie, already has devolution. The Minister in Scotland is responsible for rail investment. It is the Liberal Democrat Minister who is responsible for rail investment. Therefore, he should address his remarks about increasing investment to that source. We are concerned about getting the railway system right.
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I accept the point that was made by several noble Lords that the existing structure of franchises seems to have rigidity, but there was an announcement today of a franchise for 15 years for Wales and the Borders. I take on board the point made by the noble Lord, Lord Palmer, that franchises could be longer, which would give greater flexibility. If we are to get investment it will be necessary in some areas to rethink the nature of franchises. However, that type of consideration can be taken only by a bureaucracy and structure that is secure about its objectives. That is why we will ignore remarks about another shake-up of the administration of the railway and concentrate on the realities of the system that we need to deliver.
One of those realities is safety, as my noble friend Lord Faulkner indicated. Who better than the President of the Royal Society for the Prevention of Accidents to remind us of those issues? I ask him to bear in mind the point made by my noble friend Lord Berkeley in introducing the debate. He pressed it a little more strongly than I would when he used the phrase "hysteria" about safety. Certainly, we need to strike a balance about safety. We all know how much safer rail transport is compared with road transport. However, it is essential post-Hatfield that we have safe and secure systems in place. That is why certain aspects of franchises have been drawn up very tightly indeed and why people have been held to account, for which I am sure the House is grateful.
We are aware that a balance has to be struck, as my noble friend Lord Berkeley indicated. We must guarantee to the public that the railway is safe. At the same time, we must ensure that the necessary investment goes into a safer railway but also an effective and efficient railway. The Government are providing the long overdue sustained investment that passengers want in the network, spending some £73 million a week to improve the railways so that, by 2005, the Government will be spending double what was spent in 2001. That commitment to sustained investment is already bringing benefits. I challenge the Official Opposition to say whether they back that type of investment and whether their public expenditure plans, which incorporate 20 per cent cuts across the board, includes or excludes the railway as it does so many other areas of policy when they are challenged.
As a result of the investment, the Secretary of State launched the South West Trains new rolling stock which will bring greater quality and comfort to passengers on some of our busiest commuter lines. It also means, and I will reply directly to the noble Viscount, that we are investing in the West Coast Main Line. We do intend to ensure that it is delivered. It will mean an 80 per cent increase in capacity on trains that run on the West Coast Main Line. We are meeting necessary obligations. Rail passenger numbers are higher than at any point in the past 50 years. Passenger kilometres are higher now than in any year since 1947. Overall passenger rail use is up by a fifth since 1997. Freight traffic—a cause that is very dear to my noble friend Lord Berkeley who introduced the debate—is up by 24 per cent since 1997. Some 40 per cent of all rolling stock will be replaced over five years.

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The noble Viscount asked the Government perhaps to admit their mistakes. I will indicate on the margins that I am somewhat disturbed about the matter of rolling stock coming onstream without the power requirements for that rolling stock having been adequately and accurately foreseen. It is rapidly being put right, but I accept his challenge on that point. If we are producing new rolling stock that increases power demands, it is essential that those who propose to introduce it are very sure that there is access to power.
Viscount Astor: My Lords, who will be responsible for ensuring that that electric power comes onstream? Is it part of the rail network or part of something else?
Lord Davies of Oldham: My Lords, as I think the noble Viscount will recognise, such a significant matter is of strategic concern. We would not want this investment in new rolling stock across many parts of the system to be frustrated by an inadequacy of power. It is a serious matter that is being directly attended to.
Underpinning everything the Government have done is a commitment to delivering a safe, reliable railway for passengers, a commitment demonstrated by unprecedented levels of long-term investment. The noble Viscount derided our 10-year plan, but we intend to invest £33 billion over those 10 years. I challenge him to say when he gets the chance whether a Conservative government—were one ever to regain control of the railway, which we fervently hope does not happen—would match that investment.
Performance levels are gradually improving. As for punctuality, at the last count it had improved by about 80 per cent. However, the Government want to see more improvement in punctuality. There is no doubt at all that we will not be able to attract passengers to rail unless they can be guaranteed not only that their train will arrive on time but that it will deliver them to their destination on the basis of reasonable timekeeping. Hatfield was a disaster in that respect. It caused a tremendous slump in railway performance, which we are gradually re-establishing. However, it is true that we have some way to go in improving the situation.
A range of issues have been raised in this debate. None of us would pretend that everything is right with the railways at present—we are all too well aware of the challenges that face all those responsible for running the railway. We recognise that we need a strategic plan, which the Government have provided. We need investment in the railway. We need a recognition of where mistakes have been made in the past, a point which we made with regard to the franchises, for example.
1 hope that we have been able to establish that a great deal is being done, not least on the issue of quality. Unless we have quality in the service people will not use the railway. The businessman wants speed and punctuality; being late for meetings is not an option for him. Students are flexible on timing but
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have a limited budget and therefore require access to cheap rail fares. For freight customers, cost and reliability are critical if they are to remain competitive.
The railway needs to deliver for each of those customers. Like all other businesses, it has to recognise that its customers are very discerning. It therefore needs to provide quality, whether the quality of the environment in which it carries its passengers, in clean, comfortable trains, or the accuracy and timeliness of the information that it provides. I know that people are more frustrated by inaccurate information or, very often, the total dearth of information, when they are at a loss as to whether their train will arrive on time.
Against that background, it is clear that the Government have much to take pride in with regard to the development of the railways. Much has been achieved. There are no quick fixes and noble Lords have identified many issues today which need a number of years of substantial investment before we shall see the improvements that we need. However, the Government, with the rest of the industry, are dealing with a network which has suffered from many years of neglect and at last is obtaining the investment it requires. We recognise that still more needs to be done to ensure that rail lives up to its high expectations.
In conclusion, I approve of and applaud the remarks made by my noble friend Lord Sawyer. The issue, as regards the railways, also involves the confidence and competence of its staff. There is no doubt that there was a time when to be a railwayman was one of the proudest roles that men and women could play in working society. Regrettably, those days have gone. However, what is clear is that with investment in people and concern about the quality of staff, the railways can return again to a level of service which we look forward to producing and for which the necessary investment is beginning to be put in place.

Health and Social Care (Community Health and Standards) Bill
8.31 p.m.
House again in Committee on Clause 66.
Earl Howe Earl Howe moved Amendment No. 324ZA:
Page 26, line 19, at end insert—
"'( ) the Office for Standards in Education;
( ) the Department for Education and Skills:
( ) children's trusts;
( ) local Safeguarding Children Boards."
The noble Earl said: If we accept that there may be occasions when CHAI will need to access personal data, it is unclear whether situations involving suspected harm to children—whether in a domestic context or elsewhere—strictly will be within CHAI's remit or its sole remit.
Could the Minister clarify this point? Now that policy making for child protection has been transferred to the DfES and the Minister for Children, who will be the lead body when investigations into

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child abuse allegations take place? Will it be CHAI, Ofsted or neither? If it is Ofsted or perhaps one of the new children's trusts, will that body have unfettered access to personal medical data relating to children? Will such data be freely available in the DfES?
We need to be extremely careful when making data of this kind available to anyone and everyone with a possible interest in accessing it. Members of the Committee will be aware that the recent government Green Paper put forward a number of recommendations, one of which is for a national database of children and families. We are all familiar with why such a recommendation should have emerged in the wake of the report produced by the noble Lord, Lord Laming, into the death of Victoria Climbié. Like so many of us, I have enormous respect for the noble Lord, Lord Laming, and the work that he did.
However, there are dangers as well as benefits in any widening of access to personal data. The first danger that springs to my mind is that of jumping to wrong conclusions. I shall not weary the Committee for too long on what, I have to admit, is an abiding concern of mine. On previous occasions in this Chamber, we have debated how impossible it is for someone who has been wrongfully accused of child abuse to have that designation removed from his or her medical records or from the records of the child. In practice, it is a permanent black mark against that person, even if an allegation has been comprehensively rebutted.
We all want to see child abusers identified and brought to account, but we do not want to see a mushrooming of false allegations which traumatise parents and children and waste valuable public resources. I should be grateful if the Minister could say a little now, or perhaps write to me, about the width of the circle of privileged access that the Government envisage as regards the sharing of children's personal data. If CHAI has automatic access, albeit according to worked-out protocols, who else will be entitled to share in the data? Will the protocols be the same for those people? The more people who potentially have access to confidential data, the more it can be misused or accessed by those who have no business doing so. I beg to move.
Lord Warner: The noble Earl knows from my responses in earlier debates to concerns he has rightly raised about wrongful accusations of child abuse that I have every sympathy with them. It is not something that either I personally or the Government would want to encourage. I understand his position.
In regard to Amendment No. 324ZA, we do not feel that placing Ofsted under a duty to provide information to CHAI in this manner is the best way forward. A duty of co-operation and joint working provisions is already included in the Bill. Further, given the increased remit provided for Ofsted in relation to children set out in our recent Green Paper, Every Child Matters, we think it proper that both bodies should develop appropriate protocols with regard to joint working and information sharing. I am
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sure that government departments will try to help CHAI with information if necessary, but making it a requirement in primary legislation is not appropriate.
I am sympathetic to the inclusion of the final two bodies listed in the amendment, but neither children's trusts nor local safeguarding children boards have statutory status at this stage. Furthermore, and in response to the inquiry of the noble Lord, Lord Laming, into the tragic death of Victoria Climbié, we are currently considering to what extent these bodies should be put on a statutory footing. Therefore it would be inappropriate to place these bodies on the face of the Bill until the issue of their status has been resolved. Certainly it would go against accepted drafting practice to refer in primary legislation to bodies which do not have statutory status.
CSCI will be the lead body in relation to child protection allegations. It will have the right, where necessary, to access personal data in order to protect the welfare of vulnerable children. The position of CSCI will be considered further in the context of the response to the Laming report. Until that is made more clear, I cannot take the debate much further, other than to reassure the noble Earl that we understand his concerns. However, the amendment does not mark the way forward at this point.
Earl Howe: I am grateful to the Minister for that response and I accept that it would not be appropriate to place on the face of the Bill a mention of bodies that do not yet exist. He will understand that this was intended as a probing amendment really to tease out who will take the lead on children's issues. If it is to be CSCI, there is still a question to be raised about whether the edges are in any sense blurred and whether that body will be able to gain access to all the types of premises that it will need to investigate for the purposes of its work in this area.
As regards Ofsted, if it is expected that CHAI should work in close co-operation with it, I am a little surprised that that is not set out on the face of the Bill. Where such co-operation is required, it is important that both sides contribute to the same degree and in the same measure to the work in hand. I should have thought that duties set out on the face of the Bill would not be out of place here. Nevertheless, if it is the considered view of the Government that that is not required, then I bow to their judgment.
Again, I am grateful to the Minister for his explanation. I shall take the issue away and give it further thought. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 66 agreed to.
Clause 67 [Power to require explanation]:
Lord Warner Lord Warner moved Amendment No. 324A:
Page 26, line 38, leave out "prescribed" and insert "specified by the CHAI"
The noble Lord said: The government amendments are technical in nature and were suggested by parliamentary counsel.
As I said to earlier, similar, amendments. Amendments Nos. 335A and 361 A, under Clauses 67, 73, 89 and 99 regulations may provide for CHAI, the Welsh Assembly or CSCI as appropriate to require prescribed persons to provide an explanation of any documents or information the inspectorates obtain in exercising their relevant powers, or of any matters which are the subject of the exercise of any functions of the inspectorates.
The Bill currently provides that those regulations may require explanations to be provided at times and places set out in the regulations. This is to ensure that it will be possible to require explanations to be provided in person, as opposed to in writing, which we consider will sometimes be appropriate, particularly where the inspectorates come across conflicting data in the course of exercising their functions. These amendments clarify matters in this regard. I beg to move.
Earl Howe: I shall speak briefly to my Amendments Nos. 325 and 359, which are grouped with the government amendments.
Can the Minister expand in a little more detail on the full intent and purport of the clause? Clause 67 creates a criminal offence if a prescribed person fails to provide a explanation to CHAI of any documents or other matters referred to in subsection (1) in circumstances as yet undefined. The Minister, however, outlined one set of circumstances, which I found helpful.
We gather that regulations will be laid in due course which will set out the full extent of the power and what exactly is involved. If the Minister can give an inkling of what we can expect to see in the regulations and what kinds of circumstances these provisions are meant to cover, I am sure the Committee will find it helpful. I have also tabled an equivalent amendment to Clause 89, which relates to Wales.
I suggest, I hope not unreasonably, that because we are being presented with not only an empty box but also a new criminal offence applicable to it, the regulations to be laid should be subject to the affirmative resolution procedure to enable them to be guaranteed debating time in both Houses.
Lord Warner: I shall not go over the arguments again of why we think the regulations are suitable for the negative rather than affirmative resolution procedure. They were set out at an earlier stage of our discussion in relation to regulations of this kind.
We are moving the government amendments because there are circumstances under which CHAI, the Assembly or CSCI may require prescribed persons to provide an explanation of any documents or information the inspectorates obtain in exercising their powers. We are trying to ensure that these explanations may be provided not only in writing but in person. We will of course set out in more detail in the regulations those arrangements, but essentially this is about explanations being dealt with in writing or by a personal appearance.
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That is the purport of what will be covered in the regulations. I am not sure that I can go much further in trying to clarify what will be in the detailed regulations.
Earl Howe: The noble Lord has shed some light on the clause and I thank him for that. We look forward to seeing the regulations when they are published. No doubt these matters will by then have been thought through in even greater detail.
On Question, amendment agreed to.
[Amendment No. 325 not moved.]
Clause 67, as amended, agreed to.
Clause 68 [Reviews and investigations relating to Wales):
[Amendments Nos. 326 to 331 not moved.]
Clause 68 agreed to.
Clause 69 [Reporting to Secretary of State and regulator]:
Baroness Noakes Baroness Noakes moved Amendment No. 332:
Page 27, line 37, leave out "Secretary of State" and insert "CHAI"
The noble Baroness said: In moving Amendment No. 332, I shall also speak to Amendment No. 333.
Amendment No. 332 amends Clause 69(1), which requires the Assembly to report to the Secretary of State if it believes there are significant failings in an English NHS body. I have argued earlier in our proceedings that it is not sensible or desirable for the Assembly to concern itself with English bodies, but, if it is to do so, we believe that its reports should go to CHAI. The issue of significant failings is unlikely to be related only to the provision of care to Welsh patients. It should be left to CHAI to deliver to the Secretary of State a coherent picture, based on the Welsh perspective and CHAI's own findings.
It is possible that significant failings in an English hospital seen through the Cardiff end of the telescope are not nearly so important when contextualised for the whole of the hospital's activity. I am not suggesting that CHAI should ignore what the Assembly thinks, but the Secretary of State should receive advice on a consistent basis from the body which he has set up for that purpose.
Amendment No. 333 makes a similar provision in relation to foundation trusts. Clause 69(3) has the Assembly reporting to the regulator directly. Our amendment would have the Assembly reporting to CHAI, which can then report to the regulator under Clause 52 if, in the round, such a report is considered by CHAI to be desirable. I beg to move.
Baroness Andrews: I shall take my cue from the noble Baroness—I shall not have another debate on devolution and will keep my remarks brief.
We believe that the amendments are not necessary. To state the obvious, the Secretary of State is responsible for the overall provision of healthcare in England, while the Assembly, under Clause 68, is given the function of conducting the reviews of and

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investigations into the provision of healthcare by and for Welsh NHS bodies. As we debated last week, the new independent health inspectorate for Wales is being established to conduct reviews in the same way as CHAI does in England. Our argument is that if the Assembly identifies significant failings, it should report them to the Secretary of State or the regulator, in the case of foundation trusts. These are the people who can make things happen and make changes.
I agree with the noble Baroness that in pursuit of its responsibilities, the health inspectorate might indeed come across failings. It may find those failings in relation to Welsh patients in English hospitals. Let us assume, for example, that CHAI did not inspect a hospital recently or that it never inspected it. If HIW, as part of its programme, makes a decision to inspect that hospital, discussing its programme with CHAI, given its duty of co-operation, any difficulties it comes across will be germane not simply to Welsh patients but will have an impact on English patients as well. Therefore, we believe that this is an opportunity for something to be anticipated. It would be for the Secretary of State to determine what action should be taken to address those failings in accordance with the powers conferred on him by the National Health Service Act 1977, and likewise for the regulator, in relation to his powers under Clause 23.
I emphasise that Clause 141 provides for co-operation where it seems appropriate for the effective discharge of functions. In this context, the provision also extends towards the provision of information, including information on failings relating to English NHS trusts. Clause 126 also provides for CHAI to make and publish an annual report on both English and Welsh NHS bodies. In exercising that function, CHAI will need to have copies of all reports in relation to the functions undertaken by the Assembly, which may include information on failings relating to English NHS trusts.
I hope the noble Baroness will agree that these are reasonable arguments and withdraw her amendment.
Baroness Noakes: I thank the noble Baroness for her reply, but it has really rather strengthened my resolve on the issue. She said that CHAI would need to report both to the Secretary of State and to the Assembly on health matters. It can report to the Assembly on Welsh matters only if it has information about Welsh matters—but here we have a deliberate information flow that bypasses CHAI and goes somewhere else. There is a real asymmetry here.
We do not believe that the Welsh Assembly should have any role with regard to English hospitals—only CHAI should have a role. If the Assembly is going to do it, however, its findings will need to be filtered through CHAI, otherwise there will be an asymmetry.
Lord Livsey of Talgarth: I am sorry to intervene in the debate, but I have wide experience of the relationship between the NHS in Wales and the NHS in England. It is extremely important that there is wide consultation, particularly as it affects England. Up to 25 per cent of the patients in Powys go to English
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hospitals, in Hereford and Shrewsbury and one or two other places. That is a significant cross-border movement of patients, and it is important that they are monitored. The new hospital in Hereford has fewer beds than was formerly the case, which means that patients in Powys have achieved a second-class status in terms of waiting lists. Such matters are extremely important.
Baroness Noakes: I thank the noble Lord for that intervention. I have never denied that the cross-border flows were important. If the noble Lord had been able to join us on a previous Committee day—I am not sure which one—he would have heard an extensive debate, which the Minister may be rather disappointed that we are not having again today, about the impact of the cross-border flow. In fact, the Minister told us that she herself was a cross-border flow at one stage in her life.
The Secretary of State should get consistent advice on a hospital from one source, which should not be confused by advice coming from separate sources and, in particular, against different standards. The Assembly has decided that it will set its own standards; we do not know how they are going to be different from English standards, but they may be different. The Secretary of State has fundamental responsibility for the English hospitals, and there cannot be a lot of confusing advice about different standards and different patients, who will inevitably be at the margin of the English hospitals.
The Government have not got the measures right. In practice, on the ground, those measures will cause tremendous confusion. If the Assembly says that hospital X in England is somehow failing Welsh patients, what is the Secretary of State to do, other than to try to get an in-the-round assessment via CHAI? That is why the advice should go via CHAI in the first place.
I hope that the Government have another opportunity to rethink their Welsh interface issues before we get to Report stage, because they are really in a dreadful mess. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 333 not moved.]
Clause 69 agreed to.
Clause 70 v[Right of entry]:
[Amendment No. 334 not moved.]
Clause 70 agreed to.
Clause 71 [Right of entry: supplementary]:
[Amendment No. 335 not moved.]
Clause 71 agreed to.
Clause 72 agreed to.
Clause 73 [Power to require explanation]:
Lord Warner Lord Warner moved Amendment No. 335A:
Page 30, line 16, leave out "prescribed" and insert "specified by the Assembly"
On Question, amendment agreed to.
Clause 73, as amended, agreed to.
[Amendment No. 336 not moved.]
Clause 74 [Introductory]:
Baroness Noakes Baroness Noakes moved Amendment No. 337:
Page 30, line 32, leave out "and their value for money"
The noble Baroness said: In moving Amendment No. 337, I wish to speak also to Amendments Nos. 338 and 375.
Amendment No. 337 is a technical probing amendment. It seeks to leave out the words,
"and their value for money"
from paragraph (d) of Clause 74(2), which sets out the matters with which CSCI should be concerned in particular.
I had always understood that in the public sector value for money was regarded as synonymous with economy, efficiency and effectiveness—the 3Es. Those are the words in statute that go with the value for money functions of the National Audit Office and the Audit Commission. I am not aware of any other source of wisdom on value for money. However, paragraph (b) of Clause 74(2) refers to the effectiveness of services; and paragraph (d) refers to economy and efficiency of their provision but then goes on to refer to value for money, which seems to me tautologous. Will the Minister say what is added to Clause 74(2) by the words "value for money" as the components of value for money have already been specified?
The other two amendments in the group standing in my name and that of the noble Earl, Lord Howe— Amendments Nos. 338 and 375—add to Clauses 74 and 102 the need to safeguard and promote the rights and welfare of elderly people. We have already debated this point in connection with CHAI and I have little to add to that debate. If it is necessary to separate out a vulnerable group such as children, I believe that the case for excluding elderly people is even more important for CSCI than for CHAI given the services that local authorities must provide. I say immediately to the noble Baroness, Lady Howarth of Breckland, that children's needs are undoubtedly important. However, the problem with mentioning children is that the exclusion of other groups may create confusion as regards their relative importance. That cannot be right. I beg to move.
Baroness Barker: I wish to speak to Amendments Nos. 338A and 376 in this group. No doubt I shall achieve as much success as I have done on every other occasion when I have mentioned these two issues but none the less I shall carry on undaunted.
Along with the three Es and value for money that the noble Baroness, Lady Noakes, discussed it is important that we keep returning to the principle of equity and access to services. Until such time as that is on the face of the Bill I believe that there will be the potential for huge distortions in the provision of services.
Amendment No. 376 is concerned with the inclusion of vulnerable adults. One of social services' most important functions is the delivery of services to
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vulnerable adults. The definition of "vulnerable adults" is well set out in documents such as No Secrets. Like the noble Baroness, Lady Noakes, I was willing to accept the arguments put forward by the noble Baroness, Lady Howarth of Breckland, about children being overlooked in hospital. However, I am afraid that I do not buy that argument in respect of social services where older people and vulnerable adults are in some cases numerically the largest recipients of services. But, interestingly, they will not always be so. For example, in a number of London boroughs the emphasis is being put very much on children's services because the number of older people is declining. The noble Baroness will not be surprised to hear me say that older people and vulnerable adults have very complex needs. They are equally deserving of being mentioned on the face of the Bill.
But having said that, the noble Lord, Lord Warner, would still be well advised to adopt our amendments that set out duties of equality.
Baroness Howarth of Breckland: I must speak in this debate partly to put right any misunderstanding that I do not think that groups other than children need priority. I declare an interest as a member of the National Care Standards Commission. Children are in a minority as regards the services that they will receive through CSCI. We know from vast experience that if children do not have emphasis they lose out. These, too, are all vulnerable children. The adults being accommodated are not vulnerable adults. I do not believe that people who go into old people's homes, for example, are necessarily vulnerable. They may need accommodating, but many of them would speak out very strongly if they were described as vulnerable. Indeed, some of them have asked that that terminology should not be used. It is true of some groups with learning difficulties, who see themselves as needing accommodation, but not necessarily as in the vulnerable category.
Most children received into care—I am sure that the noble Earl, Lord Listowel, will say more about them later—are usually vulnerable, so it is terribly important that they be kept in the Bill. That should not in any way detract from the services for other groups, which are actually in a majority with most funding spent on them.
9 p.m.
Lord Warner: I admire the stamina of the noble Baroness, Lady Barker, but fortified by dinner I hope that I will also demonstrate stamina on some of the issues. I do not question the importance of the issues that Amendment No. 338A raises. I should point out, however, that the Local Government Act 2000 enables local authorities to do anything that promotes the economic, social or environmental well-being of their populations. However, we should be clear that CSCI is fundamentally an inspector of the quality of social care provision, rather than a regulator of quality of life as a whole. However, those services that it regulates will have a very important impact on an individual's

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life quality. I will not go all over the argument about equity, as we have set out our position. We do not believe that the amendment is justified.
We have already debated at some length the issues dealt with in Amendments Nos. 338, 375 and 376. I obviously sympathise with those concerned about the vulnerability of older people and certain other adults. The noble Baroness, Lady Howarth, put the case for children extremely well. As I tried to say in an earlier debate, vulnerability in relation to adults is often very much related to the particular circumstances in which a particular adult may find himself. That is extraordinarily difficult to define appropriately in primary legislation, if I may say so without being patronising to many of those groups. That does not diminish the argument that some are vulnerable in certain circumstances, which we are not making. CHAI and CSCI will have regard to their needs, as has been made clear by those organisations already. We do not think it necessary to prescribe all that in the Bill. Indeed, it would be difficult in relation to some of the adult groups about which we have talked.
Amendment No. 337 seeks to remove CSCI's general duty to inspect the value for money of local authority social services departments. That duty has two dimensions. First, it reflects the requirement in the Local Government Act 1999 for local authorities to produce best-value performance plans in relation to their functions, including their social services functions. Currently, under Section 6 of the 1999 Act, it is the duty of every local authority to produce a best-value performance plan. Section 7 of the 1999 Act requires that an external auditor audits each best-value performance plan.
The Audit Commission is responsible for auditing the best-value performance plans that cover a majority of a local authority's services. However, the Audit Commission has done so in the past by drawing on the expertise of the inspectorate for the relevant service, currently the Social Services Inspectorate, which is concerned with those parts of the plans that deal with social services. It is envisaged that in future that role will be taken over by CSCI.
The second dimension of the duty is that it will enable CSCI to continue the joint review function currently taken by the Social Services Inspectorate in conjunction with the Audit Commission. Joint reviews have provided the public with important information about how local councils allocate resources to social services, and whether they deliver value for money. The staff responsible for joint reviews, from both the Audit Commission and the Social Services Inspectorate, will transfer to CSCI. It is thus important that CSCI's duty to look at the value for money of social services is retained to allow that work to continue. That is why it would be inappropriate to accept this amendment.
Baroness Noakes: May I have clarification from the noble Lord over the point that I put to him in connection with Clause 74(2)? Paragraph (b) talks about effectiveness and paragraph (d) talks about economy and efficiency and then goes on to talk about
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value for money. I was not trying to eliminate value for money from this matter, I was saying that one already had value for money by the time one reached value for money—because one has effectiveness and economy and efficiency. 1 asked the Minister what those additional words added. I was not trying to say that CSCI should not look at value for money. Far from it. What are the Minister's views on that?
Lord Warner: I shall not repeat all the reasons that I have just given, but the essential point is that the Audit Commission has to carry out best value performance plans—auditing—under the Local Government Act 1999, and it looked in the past to the Social Services Inspectorate, in the future CSCI, to produce the expertise in carrying out the audit of that plan. Therefore, we are putting beyond doubt on the face of the Bill the point that CSCI has responsibility in that area. The noble Baroness may not accept our arguments, but that is the reason for the wording in the Bill.
Baroness Noakes: I thank the Minister; but no, the noble Baroness does not accept that value for money has to be spelt out twice within a couple of lines of the legislation. I hope that the Minister or his officials will look at that issue again, because the answer cannot be to do with liaising with the Audit Commission or about best value performance plans. If the wording has any meaning it is something that has not been to date teased out. That is one aspect of my amendments. The other relates to children.
If we return to the wording of, for example, Clause 74. CSCI "shall be concerned in particular with":
"the need to safeguard and promote the rights and welfare of children".
It is not just a question of dealing with the children who are in care. A much broader function is specified for CSCI. I was trying to add "and elderly people", the noble Baroness, Lady Barker, was trying to add "and vulnerable people", into this much wider concept of simply looking after the very vulnerable, but also promoting and safeguarding their rights. It is a very broad sense here. That is why it is difficult to see why groups other than children have been ignored. We have been through this argument once already in Committee in connection with CHAI. We have the argument again over CSCI.
I feel that the matter has not been satisfactorily bottomed out, and we shall need to return to it again, because at the moment the functions of CHAI and CSCI are being distorted by their emphasis on one very important group, but only one group among the many who ought to have some focus. I shall not press the matter further today. I beg leave to withdraw.
Amendment, by leave, withdrawn.
[Amendments Nos. 338 to 338A not moved.]
Clause 74 agreed to.
Clause 75 [Information and advice]:
[Amendment No. 339 not moved.]
Clause 75 agreed to.

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Clause 76 [Review of studies and research]:
Earl Howe Earl Howe moved Amendment No. 340:
Page 31, line 17, at end insert—
"( ) The CSCI may conduct or commission such research as it deems necessary to ensure that the future development of care services is based on independent knowledge and expertise."
The noble Earl said: Clause 76 permits CSCI to conduct reviews of research undertaken by other people in relation to local authority social services. I have no quarrel with this power, but it is unclear to me why CSCI is not being given a power to conduct or commission research directly to enable it to carry out its work in a more informed way. As the clause reads, CSCI will have to sit back and wait hopefully for others to produce interesting information that is relevant to its remit. That does not seem logical or sensible. I hope that the Minister will look constructively on this suggestion. I beg to move.
Baroness Barker: I rise to speak to Amendment No. 350, which would enable CSCI to produce reports concerning the implementation of Clause 14 of the Care Standards Act relating to registration. This is a probing amendment questioning whether CSCI will have the power to examine the impact of government regulations on home care. The disappearance of care homes has been well documented in debates in your Lordships' House. The passage of legislation through Parliament can have a direct effect on the provision of services at local level. Therefore, we want to be able to see CSCI having a free hand to commission and produce reports on the matter.
Given the Minister's response to a similar amendment, no doubt the Government will not be enamoured by the proposal. Nevertheless, it is an important element in taking a strategic view of the whole of social care within the country—something which CSCI should be able to do and have the freedom to do.
Lord Turnberg: Having spent most of my life engaged in research, or encouraging it and the knowledge gained from it to underpin medical care, I am all for the idea that CSCI should base its ideas on research. Research is certainly needed in this area. However, I am not clear on whether CSCI will be in a good position to be able to do so.
I hope that this short debate will focus the attention of the Government on the need for research of which CSCI can take advantage and in which it can take an interest. I am not sure what the mechanism might be, but I do not believe that CSCI will be set up to undertake that role.
Baroness Howarth of Breckland: I believe that CSCI will have some of the best sets of data in the world, not only in Europe, because it will have full data on all the establishments throughout the country year on year. From that it will be able to deduce information on the way we are inspecting, what that inspection shows, and
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how the service can be improved. That will not exist for some years, but it will form the basis of good research in the long term.
Lord Warner: I am grateful for the intervention of the noble Baroness, Lady Howarth. Given her background, she indicates that a great deal of material will in time come forward through CSCI. I am also grateful for the gentle question from my noble friend Lord Turnberg. It is unnecessary to allow CSCI to conduct or commission research to develop and inform its own inspection methodologies because CSCI is already able to do that under Schedule 7, paragraph 2. That provision enables CSCI to,
"do anything which appears to it to be necessary or expedient for the purpose of, or in connection with, the exercise of its functions".
It may be that the amendment is trying to take us down a road where CSCI's functions would be extended into the realm of best practice. If research were for that purpose, that would be inappropriate. The development of best practice is the proper role of the Social Care Institute for Excellence, as provided for in the Government's paper, Quality in Social Care: The National Institutional Framework, which was published in 2001. For those reasons, we believe that Amendment No. 340 is not appropriate.
The noble Baroness, Lady Barker, will be reassured by my consistency of approach in responding to Amendment No. 350, the practical effect of which would be to extend the functions and duplicate powers that CSCI already has. I suggest that it might also divert the inspectorate from its core task of monitoring the quality of both local authority social services and services regulated under the Care Standards Act 2000.
In my view, the amendment is unnecessary for a number of reasons. Under Clause 102, CSCI has a duty to keep the Secretary of State informed about the availability and quality of registered social care services and any other matter connected with the provision of such services under the Care Standards Act. If it was considered that the manner of regulation of the services was having an adverse effect on those services, it would report that to the Secretary of State.
As part of that duty, CSCI must report what it has found in the course of exercising its functions in the annual report to Parliament and the Secretary of State, which it is required to produce under Clause 127 of the Bill. I do not believe that the inspectorate—the noble Baroness may be unnecessarily pessimistic here— would ignore any evidence that its activity was having a detrimental effect on the quality, supply and cost of regulated services under the Care Standards Act. Indeed, CSCI would be in breach of its duty to keep the Secretary of State informed if it did not report such matters.
In view of that, it would be wrong to give CSCI a specific function of looking at the impact of regulation on regulated services. As I said, it is under a duty to do that in any event. Therefore, I do not believe that the amendment is appropriate.
9.15 p.m.
Earl Howe: I am grateful to the Minister for pointing out that Schedule 7 permits CSCI to carry out research. The noble Baroness, Lady Howarth, is absolutely right: looking several years down the track, it will be in a prime position to do that kind of work. With that reassurance from the Minister, I believe there is little more that I need to say. However, because I very much respect the noble Lord, Lord Turnberg, and his views, at some point I should be glad of a conversation with him about why he has doubts on this matter. But, for now. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 76 agreed to.
Clause 77 [Annual reviews]:
[Amendments Nos. 341 to 344 not moved.]
Clause 77 agreed to.
Clause 78 [Other reviews and investigations]:
[Amendments Nos. 345 and 346 not moved.]
Clause 78 agreed to.
Clause 79 [Failings]:
[Amendments Nos. 347 and 348 not moved.]
Clause 79 agreed to.
[Amendment No. 349 not moved.]
Clause 80 [Studies as to economy, efficiency etc]:
[Amendment No. 350 not moved.]
Clause 80 agreed to.
Clause 81 [Joint working with Audit Commission]:
Baroness Noakes Baroness Noakes moved Amendment No. 351:
Page 34, line 10. leave out subsections (3) and (4).
The noble Baroness said: Amendment No. 351 would delete subsections (3) and (4) of Clause 81, which concern the interface between CSCI and the Audit Commission.
Clause 81 starts by being entirely sensible. Subsection (1) states that the Audit Commission and CSCI may exercise their functions jointly. Subsection (2) states that they must co-operate with one another. But the clause goes downhill from there with the appearance of the usual suspect—the Secretary of State.
Subsection (3) seems mild enough and says that the Secretary of State may give guidance to CSCI and the Audit Commission about which should undertake studies. But the sting is in the tail of subsection (4), which states that CSCI and the Audit Commission must take the guidance into account—that is, it is not guidance but a direction. If one compares Clause 81 with Clause 57 it is apparent that a quite different approach is taken to CHAI. There CHAI is put in the lead and it is left to CHAI to agree with the Audit Commission if it wants the Audit Commission to help.
Will the Minister explain why a different approach has been taken as to the allocation of functions between CHAI and the Audit Commission on the one hand and CSCI and the Audit Commission on the other? Will he further explain why the Secretary of
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State has to intervene at all? Why cannot the overlap of functions be left to the good sense of the Audit Commission and CSCI and their duty to co-operate? Does the Minister have any reason to believe that co-operation between the two will not work out in practice? If he does I am sure that noble Lords will be interested to hear about that. I hope that this is at least one area in which the Secretary of State can be persuaded to give up one of his routes of intervention. I beg to move.
Baroness Barker: I shall speak to Amendments Nos. 352 and 353. They are probing amendments to tease out the relationship between CSCI, the Audit Commission and the Comptroller and Auditor-General. Amendment No. 352 deals with areas where there should be joint reviews or studies, the requirement to publish information and the fact that CSCI is to produce information to those bodies. Amendment No. 353 requires that the Comptroller and Auditor-General shall report to both Houses on those matters.
The amendments are trying to tease out some kind of coherence between the different regulatory bodies that will be brought together in the hope that we get streamlining rather than a profusion of reports and a duplication of work. It is quite clear that all those different bodies have a role to play in determining the value and effectiveness of social care services. It is not clear how all of them will work together in the perfect harmony that the Minister has assured us the Secretary of State will bring to these matters. I would be pleased to know what he thinks of that point.
Lord Warner: We have already gone over the ground covered by Amendment No. 351, that CSCI and the Audit Commission have a different relationship with local government from that which CHAI has with the NHS and healthcare. The Audit Commission's role in value for money studies is removed in relation to the NHS. In view of time constraints 1 shall not repeat all the arguments that I made on the previous amendment.
Under normal circumstances we would anticipate that CSCI and the Audit Commission will agree a programme of studies and determine the leadership for each individual project. However, it is possible that there may be circumstances when they are unable to reach such an agreement. Following that, it may be the case that CSCI and the Audit Commission will decide to engage in separate but ultimately very similar studies looking at the same aspects of local authority services. Such duplication would be an unnecessary waste of the resources of the two commissions and, perhaps more significantly, place an unnecessary burden on service providers. Thus in our view it is important that the Secretary of State has the power to prevent such duplication through intervening when there are disagreements between the two commissions. It would be a brave person who, looking into the future, would suggest that there will never be any disagreement between commissions, although it is unlikely.

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Issuing guidance as to how they should work together is important. That power to issue guidance is contained in Clause 81 (3) and (4) and it is that power that the proposed amendment seeks to remove. I am sorry that the noble Baroness thinks that the clause goes downhill after subsections (1) and (2). We think it retains equilibrium and we do not think that the amendment is appropriate.
We do not think that Amendment No. 352 is necessary because CSCI and the Audit Commission are each required to publish a report of any studies that they carry out under Sections 33 and 34 of the Audit Commission Act 1998, and Clause 80 of the Bill respectively. So it follows that they would have to publish a report—separately or jointly—of any studies which they carry out together in exercising these powers. The NAO already has a right of access to information held by CSCI should it need it for the purpose of auditing CSCI.
On Amendment No. 353, I do not believe that giving the NAO a specific power to report to Parliament on the work of CHAI and CSCI under Part 2 of the Bill is necessary or appropriate. The NAO can already report to Parliament in relation to CHAI because of the Comptroller and Auditor-General's powers under the National Audit Act 1983. The Comptroller and Auditor-General is the auditor of the NHS summarised accounts, which cover all NHS spending and for which there is no equivalent on the local authority side. In undertaking that audit, the Comptroller and Auditor-General will of course need to know of anything identified by CHAI in its work, in order to consider whether it should affect the response given in his audit. That is the principal reason why CHAI is required to provide copies of reports.
However, in addition, CHAI will be taking over responsibility for all national and local studies of NHS provision that are currently carried out by the Audit Commission. Thus, it will take on the responsibility to provide, at the Comptroller and Auditor-General's request, any material relevant to reviews or investigations it undertakes. That is made clear in Clause 60.
On local authority services, the Audit Commission will retain responsibility for value-for-money studies in relation to local authorities and will also retain the responsibility for providing information to the Comptroller and Auditor-General. CSCI will carry out value-for-money studies about local authorities under Clause 80 of the Bill and can be required to provide copies of reports produced under this section to the Comptroller and Auditor-General. Furthermore, the Comptroller and Auditor-General already has powers under the National Audit Act 1983 to report to Parliament.
I hope this explanation, which I cantered through, will reassure the noble Baroness that the amendment is unnecessary.
Baroness Noakes: I thank the Minister for that comprehensive reply. I shall concentrate on my own
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amendment which deals with the interface between CSCI and the Audit Commission. I also thank the noble Lord for his explanation of the difference between the treatment of CHAI and of CSCI in the interrelationship with the Audit Commission. We come back again to the Secretary of State not trusting the bodies, with which he is associated, and which were created to get on and do a good job. This is a recurring theme of the Bill. The body was set up so that the Audit Commission and CSCI can work jointly; it was set that they have to co-operate but then the Secretary of State has to come in and tell them how to do it.
We do not think this power is anything like necessary. To say that it demonstrates perhaps a lack of trust is putting the matter too lightly. It is a real unwillingness to let go of the levers of power and control. I can quite understand why the Secretary of State might want to have a lever over the Audit Commission because it can be jolly inconvenient at times. The Secretary of State and people in the health department have found that out, because it is fearless and independent.
We should think very carefully about whether or not we give the Secretary of State power in effect to call the Audit Commission off a particular area. This is getting into extremely difficult and dangerous territory and one that may well compromise considerably the independence of the Audit Commission to the detriment of accountability. I shall read Hansard and consider carefully what the Minister has said. I should say that this matter is far from closed. 1 beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 352 and 353 not moved]
Clause 81 agreed to.
Clause 82 agreed to.
Clause 83 [Criteria]:
Lord Warner Lord Warner moved Amendment No. 354A:
Page 34, line 23, after "77)" insert—
"( ) to consult any person specified in the regulations before publishing any such statement:"
On Question, amendment agreed to.
[Amendments Nos. 355 and 356 not moved.]
Clause 83, as amended, agreed to.
[Amendment No. 357 not moved.]
Clause 84 [Fees]:
Lord Warner Lord Warner moved Amendment No. 357A:
Page 34, line 29, after "authority" insert "or to an English local authority social service provided by. or pursuant to arrangements made by, that authority"
On Question, amendment agreed to.
[Amendment No. 358 not moved.]
On Question, Whether Clause 84, as amended, shall stand part of the Bill?
Lord Clement-Jones: This is a useful opportunity for the Minister to assure us about the fees that may be charged by CSCI under the clause. The Social Services Inspectorate does not currently charge local

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authorities for the provision of inspection services, but the National Care Standards Commission does. The Bill provides charging powers for CSCI to cover the former SSI and NCSC functions. Needless to say, local authorities are concerned that CSCI will be charging them for standard social services inspections, which would be a change to former practice. What reassurances can the Minister give us?
Lord Warner: As the noble Lord said, the clause provides a power for CSCI to determine and levy fees on local authorities when carrying out any review or inspection of local authority social services. We believe that it is important that CSCI as a body is independent of the department. That is common ground across the Committee. Part of that is its ability to raise revenue through fees. The Secretary of State will have no involvement in the setting of those fees. That will allow for a clear and more direct relationship between the inspecting body and the local authority.
There have been concerns that an independent body will be able to levy high fees on local authorities, but I believe those concerns are unfounded. In the first instance, the commission will be required to consult appropriate persons before setting the scale of fees. We consider that such appropriate persons would include bodies such as the Local Government Association and the Association of Directors of Social Services, which would have a clear interest in the nature of any charge levied on local authorities, as well as the local authorities themselves. We also expect that such a consultation process would take place before the publication of any revised schedule of fees.
Subsection (6) also provides a power that would enable the Secretary of State to make regulations that would allow an independent person or panel to review the charge that CSCI has set, if it has set an unreasonable charge in individual cases.
We want CSCI to be able to demonstrate its independence and the value of its work by charging reasonable fees where appropriate. There are safeguards in the Bill and the provisions in the clause will enable a proper balance to be struck.
Lord Clement-Jones: I thank the Minister for that helpful response. It is not a cast iron situation, but subsection (6) gives some redress to a local authority faced with unreasonable fees. As the Minister says, we hope that from the outset the consultation process will ensure the right level of fees.
Clause 84, as amended, agreed to.
Clauses 85 and 86 agreed to.

Clause 87 [Right of entry: supplementary]:
9.30 p.m.
Baroness Howarth of Breckland Baroness Howarth of Breckland moved Amendment
No. 358ZA:
Page 36, line 8, at end insert—
'"( ) interview in private, or solicit written or verbal expressions of opinion from, any child or group of children who consent to be interviewed or to express their views, as the case may be;"
The noble Baroness said: I shall speak also to Amendment No. 358ZA. I wish to ensure that inspectors can freely seek children's views when inspecting welfare in services for children. That may affect vulnerable groups other than children, such as other adults in care.
The Children's Rights Director, Roger Morgan, to whom Parliament has given the specific job of continually ensuring that the commission properly listens to children in all that it does, has recently asked both children and inspectors what they consider to be key elements of effective inspection. Children said that inspectors must listen to children. I agree with them; I am sure that everyone does. Inspectors confirmed that listening to children is an efficient source of evidence for judging whether they are safe and properly looked after. I agree with that, too, having been involved in situations where children were not listened to. The Children's Rights Director will now be carrying that forward for us into the future integrated inspection framework envisaged in the Green Paper. I hope that the Children's Rights Director will continue regardless of any future commissioner discussions, although I recognise that the Minister might say that that is an argument for another time and another place.
I am concerned that there are two limitations in the Bill on how far inspectors can listen to children effectively. First, Clause 87 refers only to interviewing in private; yet other ways of asking children's views are needed on inspections, such as the use of surveys, group discussions, inviting children to consultation days and electronic means of seeking views. We need to be assured that inspectors can use all those ways, and more, and not be limited only to interviewing children in private. I do not read the very specific term "interview in private" as covering all those other ways of asking and listening to children.
The second limitation is that the Bill gives inspectors the power to interview, and therefore to seek views from, only children accommodated or cared for at premises to which inspectors have a legal right of entry. That is not good enough. Inspectors also need to be able to seek views, in reasonable and practicable ways, from, for example, foster children who live, or are cared for, in the homes of their foster carers, not in any premises to which inspectors have a right of entry.
As it stands, having a power only to seek views from children who live where there is a power of entry means that inspectors can only legally ask foster children for their views and experience of fostering in a fostering service that they are inspecting, and if they ask permission of someone else first. That alerts anyone about whom the children may want to talk. That cannot be right. Inspectors have their own power to seek the views of children when inspecting other services, such as children's homes, schools and colleges, subject only to the consent of the children themselves. They need the same power to talk to foster children.
As the Minister will understand, my probing amendments are intended to ensure that inspectors can always ask children for their views and experiences,

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when inspecting their safety and welfare, in more ways than private interviews, and regardless of whether the children live or are cared for at premises being inspected. That is needed to safeguard children.
I am not asking for powers that inspectors do not already have in relation to other children's services. Under the inspection of schools and colleges regulations, under the Children Act 1989, inspectors have already been given the power to ask children for their views in more ways than private interviews.
I am not asking for inspectors to have any right of entry to private houses, such as foster carers' homes. That would not be appropriate and would go beyond the powers that they already have in other settings. But, together with the Children's Rights Director, 1 have talked to groups of children from foster homes about their experiences, with great and vivid backgrounds. My amendment would give inspectors the power to seek children's views by those and other reasonable means. I would be pleased to hear the Minister's view. I beg to move.
Lord Warner: I appreciate the concerns that lie behind the amendment. We are aware that concerns have been expressed that the powers in the Bill are not sufficiently wide to enable CSCI to interview groups of children receiving local authority services or to elicit information from them, with consent, regardless of whether they are accommodated at premises to which there is statutory access. We consider that the concerns are misplaced.
Under Clause 87( 1 )(c), a person authorised by CSCI to enter and inspect premises is already able to interview in private any person accommodated or cared for at those premises who consents to be interviewed. We are advised that there is no reason why this power would not allow an employee of CSCI to interview any child or group of children in private already. The reference to conducting an interview in private was included in the Bill to make it clear that the commission could interview in private if it and the person being interviewed thought it appropriate. There is no reason why it must interview in private.
Solicitors advise us that verbal or written expressions of opinion can already be solicited from children who consent to be interviewed under the provisions of the Bill. CSCI has powers at Clause 88(1) that allow it to require any person to provide it with information that is necessary or expedient for the purposes of its functions under Chapter 5. That would enable any person authorised by CSCI to obtain the details from a local authority of any children from whom they believed it would be necessary or expedient to elicit information, for the purposes of assessing how well a local authority was carrying out its children's social services functions.
We are advised that there is no need for an explicit power in the Bill to enable CSCI to use this information to contact children to elicit their views about the services they are receiving. They can already do that to the extent that they consider it necessary to
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judge the quality of services. Obviously, what form the contact will take—a letter or telephone call, for example—will depend on CSCI's judgment of what is appropriate in individual cases.
Amendment No. 376A is also unnecessary. The Bill will already enable employees of CSCI to elicit views or information from children receiving inspected services without the permission of another party, such as a local authority. That is the case regardless of whether the child concerned is accommodated in a premises to which the inspectorate has a statutory right of access, such as a registered children's home, or whether they are accommodated in a private home under fostering arrangements.
The specific issue of whether the children's rights director would be able independently to contact children in foster care, including private fostering, and pre-adoption arrangements had been raised with the department by the NCSC. I can confirm that the provisions already in the Bill will allow the CRD to collect information about where such children are living and to contact them to seek their views, when he judges that this is necessary in individual cases to enable him to assess the quality of services provided. Since the Bill already allows for such things, the amendment is unnecessary.
I hope that that reassures the noble Baroness and that she will withdraw the amendment.
Baroness Howarth of Breckland: I am grateful to the Minister for putting those assurances on record, for reasons that he will appreciate. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 87 agreed to.
Clause 88 [Power to require information etc]:
[Amendments Nos. 358ZB and 358ZC not moved.]
Clause 88 agreed to.
Clause 89 [Power to require explanation]:
Lord Warner Lord Warner moved Amendment No. 358A:
Page 37. line 19, leave out "prescribed" and insert "specified by the CSCI"
On Question, amendment agreed to.
[Amendment No. 359 not moved.]
Clause 89, as amended, agreed to.
Clauses 90 and 91 agreed to.
Clause 92 [Reviews and investigations]:
[Amendments Nos. 360 and 361 not moved.]
Clause 92 agreed to.
Clauses 93 to 98 agreed to.
Clause 99 [Power to require explanation]:
Lord Warner Lord Warner moved Amendment No. 361 A:
Page 41. line 19, leave out "prescribed" and insert "specified by the Assembly"
On Question, amendment agreed to.
Clause 99, as amended, agreed to.
Clause 100 [Transfer of functions to CHAI and CSCI]:
Baroness Barker Baroness Barker moved Amendment No. 362:
Page 41, line 29, at end insert—
"( ) In the Care Standards Act 2000 (c. 14), after section 23(2) (national minimum standards) insert—
"( ) In reviewing standards the appropriate Minister must ensure that lower standards are not applied to Parts 2 and 3 services received predominately or exclusively by people at or above state pensionable age.""
The noble Baroness said: In moving Amendment No. 362 I shall speak also to Amendments Nos. 363, 364,365, 367 and 368, which are grouped with it. These amendments deal with the transfer of functions to CHAI and CSCI. The latter two are designed to tease out exactly where responsibility for certain inspection functions will lie.
Amendment No. 362 deals with a subject close to the heart of many noble Lords, because we debated it at considerable length during the passage of the Care Standards Act—national minimum standards for residential and care homes. Earlier this year the Government rowed back from the exacting standards for building regulations which they set themselves in that Act. However, those standards applied only to services for adults and not to those for older people. Amendment No. 362 is designed to pose the following question. What happens when an adult who has been a recipient of care services in a residential setting reaches the age at which they are deemed to become an older person—usually considered to be pension age— as regards social care? Will they be moved? On their birthday will they be subjected to a lesser minimum standard? Will they be transferred by local authorities to different premises, and will CSCI report and investigate such matters?
Amendments Nos. 363 and 364 address the issue of non-NHS healthcare provided by an NHS or non-NHS body under the National Health Service Reform and Health Care Professions Act 2002. These amendments are designed to ask the following question. Where healthcare services are provided principally to people in residential care settings and they are provided by private providers, will CHAI or CSCI have the duty to inspect? A number of residential and nursing homes rely on private services such as private dentistry. Which of the two bodies will have the duty to inspect and regulate those?
The remaining amendments, Amendments Nos. 365, 367 and 368, deal with excepted treatments.
It is well known that one of the biggest challenges facing healthcare is the management of long-term and chronic conditions. These amendments question which body will have regulatory responsibility to look after the interests of people who have long-term conditions, which are not acute conditions, but are continuing conditions.
The amendments were clearly tabled some time ago. They have an added importance because the last day on which the Committee met, the Minister made his somewhat jaw-dropping assertion that the NHS retained little responsibility for long-term
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rehabilitation. To be clear and fair to the Minister, he said that they were matters which are now largely carried out in the community as a function of social services. Therefore, it is apt and right that we should ask the questions posed in the amendments. I beg to move.
Earl Howe: I rise briefly to support Amendments Nos. 365, 367 and 368, to which I have added my name. It may be that the expression "long term conditions" is not quite appropriate in the context of this clause, but the point made by the noble Baroness is, nevertheless, extremely well made. The difficulty with alcohol addiction centres, for example, and clinics which look after patients with acquired brain injuries, is that they fall across the definitional divide, as between mainstream healthcare and mainstream social care.
Often the reason why a particular facility is inspected by the NCSC rather than the Commission for Health Improvement is an accident of history. What we need to bear in mind is the need for institutions to be inspected by those who have a proper understanding of the work being carried out in them. Brain injury units—I visited one recently—have much more in common with acute hospitals than with residential care homes. Substance abuse clinics, equally, have precious little to do with social care and a great deal to do with specialised and intensive treatment regimes. I suggest that both should be under the wing of new CHAI.
Regulation, when it happens, needs to be appropriate. Like the noble Baroness, I am worried that arbitrary and inconsistent decisions may be taken over the regulation of these centres, which may not make sense or be appropriate to the activities in question.
Moving on briefly to my Amendment No. 370, this amendment has a very simple purpose which is to incorporate the Government's stated intention to allow CHAI to regulate private dentistry. The Bill is an obvious opportunity to meet that commitment. Earlier this year the OFT published its report into the private dentistry market, which highlighted a number of key concerns. Chief of these were that consumers are not able to access information to enable them to make informed choices; consumer complaint procedures are inadequate; and some regulation of dentistry may be unnecessary.
On the consumer front, work clearly needs to be done by the Government and the GDC to address standards of care in dental surgeries, as well as consumer-related issues, such as clear pricing, itemised accounts, whether this or that treatment is private or on the NHS, and what kinds of treatment are available. It makes sense for new CHAI to take an active part in the discussions and to be the body responsible for monitoring the standards when they are in place.
As regards complaints, there must obviously be an accessible procedure available for patients. Once again, CHAI and the GDC need to be in close

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communication about how such a system is to work. I hope that the Minister will be receptive to the amendment. If he cannot accept it as it stands, I hope that he will at least wish to take the proposal away to look at it constructively.
Lord Colwyn: Perhaps I may be allowed a few seconds intervention. I have been sitting here since about three o'clock today. This is the first time that we have heard the words "dentists" or "dental services", and I am on my feet. I, too, welcome the amendment and support all that my noble friend said. It is important that CHAI—or having heard the noble Baroness, Lady Barker, perhaps it may be CSCI— should monitor availability, quality and access to dentistry and independent dental services. As the remit of the two bodies increases, I should like confirmation from the Minister that they will not include dealing with complaints and complaint handling.
As my noble friend Lord Howe has just mentioned, the OFT report has made quite a considerable impact on the dental profession. Indeed, as soon as the legislation is in place, the General Dental Council is planning to produce regulations to monitor the independent sector. Perhaps Clause 101 will negate the need for that, which would be wonderful so far as I am concerned because, year on year, an ever-increasing amount in respect of retention fee may not now be necessary. I look forward to hearing what the Minister has to say.
10 p.m.
Lord Warner: I feel a little like Marcus Trescothick on reaching his hundredth; I now take guard for the next hundred. In order to address the long wait mentioned by the noble Lord, Lord Colwyn, if the Committee will bear with me, I shall deal first with Amendment No. 370. We certainly support wholeheartedly the intentions behind this amendment. In June, in the Government's response to the OFT report, The Private Dentistry Market in the UK, we made a commitment to include private dentistry within CHAI's remit. The OFT concluded that the public needed better protection from a small minority of dentists who were providing poor-quality services and, often, being less than transparent about their charges for those services.
However, we are planning to introduce the necessary provisions by means of secondary legislation. Section 2(7) of the Care Standards Act 2000 contains a list of services within the remit of the National Care Standards Commission. Included in this list at Section 2(7)(b) are,
"dental services under general anaesthesia".
Accordingly, the National Care Standards Commission is already empowered to regulate dental practices providing general anaesthetics. As a result of this Bill, the commission's responsibilities in relation to private health and dental care will become CHAI's.
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Section 2(8)(c) provides for the definitions of the listed services at Section 2(7) to be modified by regulation. We propose to modify the definition at Section 2(7)(b) to read,

"dental services under local and general anaesthetic",
which, since local anaesthetics are an integral part of dental practice, will have the effect of bringing all private dental practices within the remit of CSCI and CHAI.
The advantage of this legislative route is that we are required to consult interested parties about changes in CHAI's remit. Shortly we will work up a draft together with greater detail on how the existing regulatory framework might be adapted to apply to wider dental practice and circulate it to the bodies concerned with dentistry and consumer interests. We would aim to have the regulations in place during 2004.
I hope that, in the light of those reassurances to the noble Lord, Lord Colwyn, the noble Earl will feel able to withdraw his amendment.
Turning back to Amendment No. 362, it is of course desirable that lower standards should not be applied to services for older people. It is already the case that the national minimum standards must be applied to services under Part 2 of the Care Standards Act regardless of the age of the individual receiving those services. The consultation process prior to the introduction of services ensures that the standards we develop do not have a disproportionate effect on any set of service users.
The amendment also appears to assume that discrimination against older people takes place in the application of national minimum standards. This is not the case. Those standards are based on the type of establishment or agency in or from which an individual is receiving services, and not the predominant age of the person receiving those services.
Section 24(3) of the Care Standards Act provides that the national minimum standards must be consulted before they may be introduced. This allows for the views of service user groups to be taken on board and acts as an extra safeguard to ensure that national minimum standards do not unintentionally discriminate against any one set of users. We do not think, therefore, that this amendment is necessary.
I turn now to Amendments Nos. 363 to 368, which concern the division of responsibilities between CHAI and CSCI. We have been over this ground at length, although the Government do recognise that it is not always easy to distinguish between where the provision of healthcare ends and the provision of social care begins for the purposes of regulation. This matter was considered in depth when the White Paper, Modernising Social Services, was published in 1998. At the time, Ministers decided, on the basis of the subsequent consultation and in the best interests of service users, that all provision that did not provide acute services led by medical staff, but provided substantial levels of personal care would in future be

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regulated as care homes. This is the provision about which the Independent Healthcare Association, among others, has been concerned.
When developing the Bill, the Secretary of State decided that the future division of the National Care Standards Commission's responsibilities should be based on the current categories of establishments registered under the Care Standards Act to avoid confusion and disruption. This meant that services that would currently be registered as private and voluntary healthcare services would be transferred to CHAI. We believe that care homes providing nursing should remain registered by CSCI rather than giving regulatory responsibility to CHAI because of the very high levels of personal care provided in such services.
It is the Government's view that services providing long-term care and treatment for drug and alcohol abuse are not providing acute medical intervention, as do hospitals, for people with these conditions but are providing secondary care to aid recovery or to manage on-going secondary symptoms. These facilities may have substantial input by nurses and allied health professionals, but have limited input from doctors.
Nevertheless, these services are also providing substantial personal care for service users, including some of the most intimate forms of care, and, in common with other care homes providing nursing and personal care, we believe that these services should properly continue to be regulated by CSCI so that their welfare needs can be most appropriately met. CSCI will, of course, be able to seek assistance from CHAI where healthcare professional expertise is needed.
The amendments tabled have the intended effect of transferring the regulation not only of those services highlighted by some—for example, those supporting recovery from brain injury or recovery from drug or alcohol abuse—but of any long-term condition. So this would mean that elderly people with Alzheimer's who received any kind of nursing or other health service in their care home would be regulated by CHAI. The personal care and welfare needs of these service users, which most certainly are equal to or greater than any health need, and are probably their major need, would not be appropriately covered by the regulatory framework under the 2000 Act under these amendments. I was not saying earlier that rehabilitation was not an important part of healthcare; I was saying that in many of the cases we have discussed in regard to this issue personal care needs are the dominant factor.
Under Clause 118, the Bill provides for joint working between CSCI and CHAI. The intention here is that the commissions should be able to plan to work together to review the quality of joint services between the NHS and local authorities and share expertise where services regulated by either commission have substantial health or social care aspects. For the reasons I have given, we do not believe that the amendments are needed.
The effect of Amendment No. 369 would be to remove CHAI's duty to keep the Secretary of State informed about the general provision, availability and
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quality of independent healthcare provision. CHAI's general duty of keeping the public informed about the provision of independent healthcare is well established.
It is entirely proper that the Bill clearly states that CHAI, in addition to its other duties, has a more general duty to keep the Secretary of State informed about the general provision, availability and quality of independent healthcare provision. It is a significant role of CHAI, using all the information it will have to hand about the performance of independent healthcare providers, to advise the Secretary of State on issues about the availability and quality of care— care which, in many cases, is used also by NHS patients.
CHAI has a prominent: role to play in the continued evolution of independent healthcare provision. The amendment, if carried, would significantly hinder the fulfilment of this role.
Baroness Barker: I thank the Minister for that reply. It confirms my on-going belief that we have no agreement whatever about the boundaries between healthcare and social care. We have not had agreement in all the Bills on which I have worked, so it does not come as a surprise now.
I do not believe that the situation is anywhere near as cut and dried as the Minister makes out. It is entirely possible that identical units doing identical work in different buildings and different institutions with different designations could be subjected to completely different regulation.
The Minister mentioned Alzheimer's disease services. It is entirely possible that people could find themselves in something designated a care home, receiving exactly the same treatment as they would in a nursing home, but the two homes would be subject to completely different regulation.
I believe that as long as this inconsistency exists, there will be a risk of duplication and of inappropriate regulation by the wrong body. I therefore do not share the Minister's confidence that all will be cut and dried. I have no option but to withdraw the amendment at this stage, but the concerns remain and they are very strong. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 363 to 365 not moved.]
[Amendment No. 366 had been withdrawn from the Marshalled List.]
[Amendments Nos. 367 and 368 not moved.]
Clause 100 agreed to.
Clause 101 [General functions of CHAI]:
[Amendments Nos. 369 and 370 not moved.]
Earl Howe Earl Howe moved Amendment No. 371:
Page 42, line 15, at end insert—
"( ) The CHAI shall ensure that so far as it is practicable the standards and procedures applied to its responsibilities in relation to independent health services are the same as those applied to services provided by or for NHS bodies."
The noble Earl said: In moving Amendment No. 371, I shall speak also to Amendment No. 377.
It is decidedly welcome, as we have said on a number of occasions, that with the creation of CHAI and CSCI we shall now have a single regulator for the state and independent hospital sectors combined, and a single regulator for private and state-run care homes. But having a single regulator in each case is not, of course, enough. Both the private and state sectors have to be judged according to a uniform set of standards.
At the moment, independent sector hospitals work to minimum standards and published sets of regulations which, although having the merit of being transparent, are decidedly bureaucratic. NHS hospitals work to the principles of clinical governance, which are much less explicit. We are living in a time when partnership working between the two sectors is increasing. The concordat means that independent hospitals are treating more and more NHS patients. It is quite simply against those patients' interests for the standard of care that they are entitled to expect to differ according to which sort of hospital they are in. They need to know that there is a level playing field on which NHS and independent facilities are judged alike. Consultants also need to know that since, of course, many work in both sectors.
There ought to be a timetable for this. I am suggesting that the Government should publish such a timetable within a year of the Bill coming into force, with a goal of achieving convergence within five years from that point. That ought not to be seen as excessively ambitious.
It is not enough for this simply to be a vague aspiration. I should like to hear whether the Minister will take this concern on board. It would be most regrettable if CHAI were just to continue with a separate approach towards each sector. Perhaps one way of moving towards a convergence of standards would be for CHAI to address the regulation of the new diagnostic and treatment centres which are to be run by both NHS and independent providers. I beg to move.
Lord Clement-Jones: I shall speak to Amendment No. 377. We on these Benches welcome the creation of single regulators for both state and independent—or public and private—sectors. It never made any sense that independent hospitals and care homes should be regulated by different regulators from publicly run facilities, and we made no bones about that when the respective Bills were going through this House.
However, we need to go further, as the noble Earl, Lord Howe, has made clear. We are moving into the era of a mixed economy of providers of acute care in particular, but there still will not be consistency between public and private provision. While both sectors may have the same regulators, it appears that they will still continue to be judged by very different sets of standards. At a time when partnership working between the two sectors is increasing and when the
1384
independent or private hospitals are treating ever-more NHS patients, this cannot be justified. The noble Earl, Lord Howe, referred to diagnostic and treatment centres as one example; indeed, commissioning is increasingly taking place at large for elective surgery from the private sector and from the NHS.
Amendment No. 377 proposes a clear mechanism whereby the Government are required to publish a timetable to ensure that the private and public sectors are judged by the same standards. For the benefit of patients, there needs to be a common set of standards and a clear mechanism for achieving that.
Lord Hunt of Kings Heath: In speaking to the amendment, I remind noble Lords of my previous reference to the range of various interests that I have in the health service. In particular, I refer to my advisory role with Beechcroft Wansbroughs, which provides advice to both the NHS and private sector organisations.
I do not want to react unduly to the remarks made by the noble Lord, Lord Clement-Jones, and go back over old ground about the original decision to treat regulation of the independent sector differently from management of the NHS. A lot of water has flowed under the bridge. In this Bill, it is right to bring the regulation of both the independent sector and the NHS under the same umbrella inspectorate. However, I am persuaded that the noble Earl, Lord Howe, and the noble Lord, Lord Clement-Jones, are right about the need for a level playing field.
We are moving from a situation in which the NHS was seen as a service provider to one in which the NHS must be seen much more as a healthcare system. The role of government is to provide the money to ensure that national standards are set and that inspection takes place to make certain that standards are up to scratch. It follows that it matters less who provides those services. From the increase in the use of the independent sector by the NHS, and from the Government's own stated policy to encourage diversity of provision, it is clear that, in terms of the work of CHAI, there ought to be a level playing field between the NHS and the independent sector.
As the noble Earl, Lord Howe, intimated, at the moment CHAI inspects the NHS on clinical governance, whereas the NCSC inspected the independent healthcare sector against national minimum standards. As the new CHAI becomes established, I agree that it would be very good if the Minister could tell us at what stage CHAI will start to inspect both the independent sector and the NHS according to the same regime. Long-term, that must make sense. It is difficult to bring those two inspectorate regimes together in a short space of time, because that would have enormous consequences for the NHS and the independent sector. However, it would be very helpful to both sides to know when those standards will converge.
Lord Warner: The standards in the social care sector applied to the independent services and local authorities under the Care Standards Act 2000 are

1385
already consistent, so that the same quality standards apply to independent care home or children's home providers as apply to local authority providers. There is no substantial difference. The National Care Standards Commission regulates local authority providers and independent providers against the same criteria when determining whether standards are being met. That will remain the basis on which CSCI will take over the regulatory work to be transferred to it from the National Care Standards Commission under the Bill.
On the NHS and healthcare the issues are a little more complicated. We have already made a commitment to apply similar standards to both sets of providers over time. However, while it is likely that there will be a great deal of coherence between NHS standards and the current standards for independent healthcare, I remind noble Lords that the range of activities and services provided by the NHS is much greater than that supplied in the independent sector. Of course where the independent sector is providing a set of services under contract to a health authority, those will be consistent with standards applied to the NHS and will be inspected and regulated on that basis. The position is slightly different where the independent sector is not providing those services in effect directly to NHS patients as part of the NHS.
CHAI will ensure that independent care provision will continue to be provided at a level comparable to that achieved by similar organisations within the NHS. The role of CHAI is to provide an independent assessment against standards set by government for both the NHS and the independent sector. Such standards are not set in stone and we expect to review and revise them over time. CHAI, by the power in Clauses 53(2) and 101, which amends the Care Standards Act 2000, is empowered to advise the Secretary of State of any changes which it thinks should be made for the purpose of securing improvements in the quality of healthcare provided and in the relevant standards. This is an appropriate role for CHAI using all the information that it will have to hand about the performance of both NHS and independent healthcare providers. It will advise the Secretary of State where standards may need amendment or development.
It is not our intention that NHS care standards will totally subsume the national minimum standards for independent healthcare providers but we expect that over time a common set of standards covering both NHS and independent healthcare providers will be developed. CHAI has a proper role in this but we do not think that it is appropriate at this point to set a prescriptive timetable in the way in which the amendment suggests. We think that the work needs to be built up over time.
10.15 p.m.
Lord Clement-Jones: I grow more confused by the Minister's reply. I do not know whether it is due to the hour but I certainly did not understand all the language in that response. Indeed, I was not entirely clear even about the thrust of it. Is it the intention to
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develop a common set of standards? The Minister may not accept the timetable or the setting of" a clear timetable, but is it the Minister's intention that CHAI should develop common standards as between the independent healthcare sector dealing with private sector patients—I accept that two different kinds of patient go through the independent healthcare sector—and the standards which are applicable to NHS patients?
Lord Warner: I was trying to be cautious. We accept the need for convergence; we do not accept the need for convergence within a prescriptive timetable. I was saying that as services are provided by the independent sector under contract to the NHS, they will be assessed under the standards that apply to the NHS. They will have to meet those NHS standards that are set by the Secretary of State.
Lord Hunt of Kings Heath: I hope that my noble friend will give the matter further consideration before Report. Two issues arise from the matter. First, my understanding is that most independent hospitals provide some services to the NHS through contracts. If we are to take it that an independent hospital is providing services to those patients according to NHS standards, that would suggest that achieving convergence would not be a problem for many of those hospitals as they have already achieved convergence in relation to a proportion of their patients. Secondly, with the introduction of the choice policy and national tariffs, the issue of a level playing field surely relates as much to the independent sector as to the NHS. That is why it is important to give a date when convergence will be reached.
Lord Clement-Jones: I would like to make one further observation, at the risk of alienating the Committee at this time of night. From what the Minister has to say, theoretically over the next two or three years there could be two patients—one an NHS patient, another a private patient under an insurance policy or whatever—next to each other in the same ward or the same independent hospital with two different standards. That is a completely crazy situation, and not one envisaged by the merger or by the fact that the National Care Standards Commission is no longer dealing with acute healthcare, with everything going into CHAI.
Lord Warner: We are not denying that there is an issue. We are saying that we do not want to be prescriptive about the speed at which we can deal with the issue at the moment. I hear the concerns expressed by Members of the Committee, especially those from behind me, and I will take the matter away and consider whether we can do anything more to reassure them.
Earl Howe: The amendment is very simple and straightforward. It is not very ambitious in what it proposes. I am very grateful to the noble Lord, Lord Hunt, for his support, and I agreed wholeheartedly

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with what he said. It should not matter to the patient where he is treated, only that the treatment that he receives is of the same high standard in any equivalent setting. Comparability, which I think was the word used by the Minister, does not carry the same connotations to me as uniformity and consistency.
My amendment proposes a time-scale that can be described as prescriptive but, if no time-scale is set, we could be sitting here in 10 years' time with nothing substantively having changed. If it is true that diagnostic and treatment centres and services provided under contract to the NHS will be judged under an equivalent set of standards, as the noble Lord, Lord Hunt, said, that suggests that achieving convergence will not be as difficult as the Minister makes out. This is really a matter of principle on which I would like to test the opinion of the Committee.
10.22 p.m.
On Question, Whether the said amendment (No. 371) shall be agreed to?
Their Lordships divided: Contents, 29; Not-Contents, 54.

Division No 2

CONTENTS

Addington, L.

Liverpool, E.

Astor of Hever, L. [Teller]

Luke, L.

Atllee, E.

Mancroft, L.

Barker, B.

Montrose, D.

Blatch, B.

Noakes, B.

Bridgeman, V.

Northbrook, L.

Byford, B. .

Onslow, E. .

Caithness, E.

Peel, E.

Roper L

Clement-Jones, L.

Seccombe, B. [Teller]

Colwyn, L.

Skelmersdale, L.

Cox.B.

Smith of Clifton, L.

Ferrers, E.

Strathclyde, L.

Howe, E.

Wade of Chorlton, L.

Hunt of Wirral, L.

Wilcox, B.

NOT-CONTENTS

Acton, L.

Evans of Parkside, L.

Amos, B. (Lord President)

Evans of Temple Guiting, L.

Andrews, B.

Farrington of Ribbleton, B.

Archer of Sandwell, L.

Faulkner of Worcester, L.

Bach, L.

Gilbert, L.

Bassam of Brighton, L.

Golding, B.

Berkeley, L.

Grocott, L. [Teller]

Bernstein of Craigweil, L.

Hilton of Eggardon, B.

Brennan, L.

Hollis of Heigham, B.

Brooke of Alverthorpe, L.

Howarth of Breckland, B.

Burlison, L.

Hughes of Woodside, L.

Campbell-Savours, L.

Hunt of Kings Heath, L.

Carter, L.

Jay of Paddington, B.

Chan, L.

Jones, L.

Chandos, V.

Jordan, L.

Crawley, B.

Listowel, E.

Davies of Coity, L.

Lofthouse of Pontefract, L.

Davies of Oldham, L. [Teller]

McIntosh of Haringey, L.

Dean of Thornton-le-Fylde, B.

McIntosh of Hudnall, B.

Desai, L.

MacKenzie of Culkein, L.

Dixon, L.

Mitchell, L.

Elder, L.

Morgan, L.

1388

Pendry, L.

Warner, L.

Plant of Highfield, L

Warwick of Undercliffe, B.

Randall of St. Budeaux, L.

Watson of Invergowrie, L.

Sawyer, L.

Whitty, L.

Simon, V.

Young of Old Scone, B.

Resolved in the negative, and amendment disagreed to accordingly.
10.32 p.m.
[Amendments Nos. 372 to 374 not moved.]
Clause 101 agreed to.
Clause 102 [General Functions of CSCI]:
[Amendments Nos. 375 to 376A not moved.]
The Earl of Listowel The Earl of Listowel moved Amendment No. 376B:
Page 43, line 25, at end insert—
"( ) The CSCI shall have particular regard to support for residential care staff with responsibility for children."
The noble Earl said: The purpose of this probing amendment is to learn what priority support for residential child care staff tending children in care will have for the new inspectorate. I apologise for not drawing the amendment more narrowly to concentrate on children's homes, as had been my intention.
Despite recent welcome innovations, such as minimum standards, Quality Protects and Choice Protects, residential care staff in children's homes require special attention. They deal with our most challenging and needy children. For the most part, they remain unqualified in contrast to the high level of professional qualification required for such residential care staff across Europe. There has been delay in qualifying the workforce in National Vocational Qualification level three. We hope that 80 per cent of them will now be so qualified by 2005. NVQ level three is still well below that required on the continent, welcome though it is.
There has been a long, sad history of professional misconduct. The sector is small and shrinking further, so there is a danger of it being overlooked. Yet success in residential care provision is important to success in increasing placement stability and outcomes for children in care.
Staff require the support described in Chapter 8 of Choosing with Care—the report of the committee of inquiry into the selection, development and management of staff in children's homes, published in 1992. The committee was chaired by the noble Lord, Lord Warner—Norman Warner, as he was then. Staff in these homes need special support in working successfully as a team. In the recent National Children's Bureau report, Better than you think: staff morale, qualifications and retention in residential child care, effective teamwork was identified as a key attribute in improving outcomes for children in residential care.
In the conclusions of his report on safeguarding children living away from home, Sir William Utting made the important point that the best safeguard is an environment of overall excellence. In Germany, staff

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have a degree behind them before going into such work. In fact, they normally have postgraduate qualifications before doing so. Children in care in Germany can expect to gain a good clutch of Abitur— the equivalent of A-levels. Sadly, children in care in this country do not do nearly so well, but I shall not describe the details. I shall try to be as brief as possible.
The manager of a care home that I visited recently said, "I'm afraid that I would call two of my staff semi-literate. They are barely able to put down on paper information about what is happening with the children so that other staff can understand what is going on". Very good work is being done in some children's homes and there are some excellent special residential schools, but so much more needs to be done.
Tomorrow I shall attend a lunch cooked by care leaders. This is Care Leaders Week. Margaret Hodge, the Minister responsible for children, will address the meeting. I am looking forward to my sushi for lunch tomorrow. Significant numbers of care leaders do well but, sadly, when one looks at the criminal justice system, one sees that one-quarter of inmates have had some experience of being in care. I believe that we need to do far more in this area and that it requires the special attention of the inspectorate. We need to ensure that the inspectorate gives a high level of attention to, and supports, under-qualified staff working in these difficult conditions. I look forward to the Minister's response to the amendment. I beg to move.
Lord Warner: It is a pleasure to respond to this amendment. It takes me back a long way to when one tried to drive up standards in residential childcare. I accept much of what the noble Earl said about continuing to have to work away in this area in order to secure improvements.
We fully accept the need to ensure that care staff working in residential homes are supported. Children's Homes: National minimum standards, published in March 2002, set out in some detail the support which must be provided to staff working in residential homes. Standards 17, 28 and 31 have particular regard to the support of residential care staff and respond to the relevant recommendations in the report, Choosing with Care, which I was privileged to chair.
However, the national minimum standards are just one set of standards that the Government have produced for the regulation of care services. Standard 28 is, indeed, important. It states:
"All staff, including domestic staff and the registered person of the home, are properly managed, supported and understand to whom they are accountable".
In addition, Standard 31 states:
"Staff receive training and development opportunities that equip them with the skills required to meet the needs of the children and the purpose of the home".
These are the standards against which the homes are inspected.
The role of CSCI, as is the current role of the National Care Standards Commission, is to inspect children's homes against those national minimum
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standards. It is in that context, and particularly in respect of inspecting against Standards 28 and 31, that CSCI has a role in regard to support for residential care staff. Given the inspection role, I do not believe that it would be appropriate to add a further general duty under Clause 102.
Under Clause 102 CSCI has the general duty of encouraging improvement in the quality of registered social care services provided in England. In doing so CSCI will clearly need to look at the education and training of those working in residential children's homes to ensure that they are fit to do the job. I know that that is a concern of the noble Earl. It will look beyond the minimum of education and training as required in the national minimum standards to ensure that improvement takes place. I noticed that at the social services conference last week Denise Platt, the shadow chair of CSCI, affirmed that. She spoke about the commission's focus on promoting positive improvements in service. I hope that the noble Earl will be reassured by that and that he will feel able to withdraw the amendment.
The Earl of Listowel: I thank the Minister for his helpful reply. I shall carefully read what he has said. It is good to have it on the record. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 102 agreed to.
[Amendment No. 377 not moved.]
Clauses 103 to 107 agreed to.
Clause 108 [Boarding schools and colleges]:
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 378:
Page 46, line 6, at end insert—
"( ) In exercise of its functions by virtue of this section, the CSCI shall—

(a) prepare a report on the discharge by the school or college
of relevant functions;

(b) without delay send a copy of the report to the school or
college; and

(c) make copies of the report available for inspection at its
offices by any person at any reasonable time:

and may take any other steps for publicising a report which it considered appropriate.
( ) Any person who asks the CSCI for a copy of the report shall be entitled to have one on payment of a reasonable fee determined by the CSCI; but nothing in this subsection prevents the CSCI from providing a copy free of charge when it considers it appropriate to do so."
The noble Lord said: One of the great pleasures of legislation is how one can find a clause in the least expected place. The latest version of Section 87 of the Children Act is to be found, not in the Act, but in Section 105 of the Care Standards Act 2000. When Clauses 108 and 109 of this Bill refer to it they refer to that section, as amended.
Taking the matter a stage further, when one looks at new subsection (9A), as introduced by Clause 109 of this Bill, one sees that it refers to Section 105(5). For the aficionados subsection (5), as introduced by Section 105 of the Care Standards Act 2000, specifies:
"Where accommodation is, or is to be, provided for a child by any school or college, a person authorised by the appropriate authority may, for the purpose of enabling that authority to discharge its duty under this section, enter at any time premises which are, or are to be, premises of the school or college".
So the plot thickens. When one looks at Clause 109, subsection (9A) appears to be a good subsection. It states:
"Where the Commission or the National Assembly for Wales exercises the power conferred by subsection (5), it must publish a report".
If one did not know what subsection (5) contained, that would be quite an interesting and rather useful subsection. However, subsection (5), which I have just read to the Committee, is so narrow. Providing a report simply about accommodation and entering premises to ascertain whether the authority is discharging its duty as regards that accommodation is a very narrow provision. Something along the lines of Amendment No. 378 would be far better. That would encompass the whole of Section 87, and under subsection (4) there are duties. The subsection reads:
"Where the Commission are of the opinion that there has been a failure to comply with subsection (1) in relation to a child provided with accommodation by a school or college",
the commission is obliged to notify the local education authority, the Secretary of State and so on. A report in those circumstances would be of far greater use.
Having engaged in something of a truffle hunt to find the real purpose of this section, one discovers at the end of the day the very limited nature of Clause 109 in this Bill. I hope that the Minister has understood me and has an answer to why that clause introduces such a limited reporting duty. I beg to move.
10.45 p.m.
Baroness Andrews: I must confess that the amendment has taken a slightly different direction from the one I anticipated. I did not expect the noble Lord to be so assiduous in searching out truffles in that particular direction, so I shall have to write to the noble Lord about his point.
I did have some good news for the noble Lord but I am not sure how good the news is now. I presumed that he was seeking to ensure that the reports generated went to each school as a matter of course. They go as a matter of practice but not as a matter of law. In fact Clause 109 does all that Amendment No. 378 seeks to do, except in that specific, but actually very special, regard.
I was going to tell the noble Lord—and still will— that we are minded to look sympathetically at the amendment and to consider the specific point about requiring that the report goes back to the schools and residential homes in question. We will look favourably on that. It is standard practice, but it might be useful to have it in the Bill.
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On the noble Lord's second point about why the issue suddenly becomes so narrow when the current breadth of the clause leads one to think otherwise, I shall have to write to the noble Lord.
Lord Clement-Jones: I think that that is as good an answer as I can expect at this time of day. So I thank the Minister and look forward to further progress. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 108 agreed to.
Clauses 109 and 110 agreed to.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 379:
Before Clause 111, insert the following new clause—
"COMPLAINTS

(1) Complaints under this Act may be made by an individual or a body of persons, whether incorporated or not.

(2) A complaint may be submitted in respect of—

(a) the exercise by an NHS body of any of its functions;

(b) the provision by any person of health care for which the body is responsible;

(c) the provision of an NHS service by a health professional supplied under private contract; and

(d)the provision of services by the body or any other person in pursuance of arrangements made by the body under section 31 of the Health Act 1999 (c. 8) (arrangements between NHS bodies and local authorities) in relation to the exercise of the health-related functions of a local authority.

(3) A complaint may be initiated by—

(a) the person aggrieved;

(b) his personal representative;

(c) a member of his family;

(d) an independent advocate, or

(e) some body or individual suitable to represent him."

The noble Lord said: In moving Amendment No. 379, I shall speak also to Amendments Nos. 380 and 386. Amendment No. 379 adds more detail to Clause 111 on the complaints process in order to put the answers to key questions on the face of the Bill. Who is the complainant? What are the issues that can be complained of? What are the rights of advocacy? It does not attempt to outline a detailed procedure, which will remain a matter for regulation, but it puts in place the framework of a process that is independent from the Secretary of State. Currently, the process established in the Bill for handling complaints is entirely contingent on regulations.
On Amendment No. 380, the statutory difference between "may"—a discretionary duty—and "shall"— a mandatory duty—applies. I do not need to trouble noble Lords once again with distinctions between "may" and "shall". However, it seems unlikely that Ministers will not want to make regulations to introduce a comprehensive complaints procedure, but there is nothing technically in the Bill which actually introduces the duty to do so.
I turn to Amendment No. 386. While it is recognised as desirable that complaints are made within a prescribed period, this is not always possible and a degree of flexibility should be allowed in this regard.
The amendment would enable consideration of the many complaints that are currently in the system which have been pursued by complainants for years without satisfaction. It is important that these do not suddenly become null and void. New procedures should ensure speedy resolution and, in particular, an automatic transfer to independent review after a maximum of six months. They should not further penalise people who have already suffered a great deal. This should also apply to those who pursue a complaint through an inappropriate route and consequently come to use the NHS complaints procedure only after this has proved unsuccessful. I beg to move.
Baroness Andrews: Clause 111(1) is intended to set out in general terms what a complaint may be about. As the noble Lord said, Amendment No. 379 would broaden who may make a complaint under the regulations and what a complaint may be about.
The amendment would include too great a level of detail in the Bill. Clause 113(2)(a) already allows for the regulations to set out who may make a complaint; and Clause 113(2)(b) provides that regulations may make provision about the complaints which may or may not be made under the regulations.
I suspect that we shall discuss the regulations during our debates on the clauses. Let me reassure the Committee that we intend to consult widely on the content of the regulations. We therefore need to be able to respond to comments received and to change things, where people come up with sound reasons for doing so. It would restrict our ability to respond flexibly to the results of the consultation if specific provisions were required under the Bill. So the amendment would not add value to the Bill. I hope that the noble Lord will share my view.
On Amendment No. 380, I fear that the noble Lord has the power of clairvoyance. We do not believe that it is necessary to substitute "shall" for "may". In circumstances such as this, where the intention of the regulations is to implement policy, it is normal drafting practice to provide a power to make regulations rather than to impose a duty. So we find that amendment difficult to accept.
Although I understand what the noble Lord seeks to achieve by Amendment No. 386, again, it would be inappropriate to be so prescriptive about the detailed aspects of the regulations. It is important to retain some flexibility on the detail of what regulations will eventually provide, especially from the point of view of involving stakeholders in decisions about how the procedures that will affect them will work. As I said, we intend to consult widely on the regulations.
Moving to Amendment No. 395, there will clearly be occasions when it is appropriate for CHAI or CSCI to exercise the functions of their counterparts on their behalf: for example, where a complaint is about a package of services delivered by arrangement under Section 31 of the Health Act 1999. In such cases, regulations made under Clauses lll(l)(c) and 112(l)(c) may require each commission to exercise the
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functions of the other in considering a complaint about both health and social care. To that extent the amendment is inappropriate and unnecessary.
It is equally important that CHAI and CSCI should co-operate with each other where appropriate: for example, where one body may have expertise that the other lacks. That is something that we have tried to advance in reforming the complaints procedure; that is central to what we are trying to do. The Bill already provides adequately for that in Clause 118, which requires CHAI and CSCI to co-operate when necessary for the effective discharge of their respective functions, and in particular for CHAI and CSCI to delegate any of their functions to each other.
So, for all those reasons, although I am sorry to give the noble Lord a disappointing reply, I hope that he will withdraw the amendment.
Lord Clement-Jones: I thank the Minister for her reply, although I confess that I do find it disappointing. She seems to be arguing for flexibility on the Government's behalf but not much flexibility for the complainant. That does not have the right balance. She says that the Government will be consulting widely. I hope that they will bear in mind the need for complainants not to have an absolutely rigid time limit imposed on them. We may well want to take the matter further during the Bill's later stages.
As for Amendment No. 395, to which I did not speak, I entirely accept what the Minister said about Clause 118, which provides much assurance in that respect. However, Clause 111 is inadequate in its detail about the complaints system to be introduced; it gives few pointers in that respect. We may need to fill that out in future. In the mean time I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 111 [Complaints about health care]:
[Amendment No. 380 not moved.]
Baroness Noakes Baroness Noakes moved Amendment No. 381:
Page 46, line 37, at end insert—
"( ) the provision of health care services by any other person or body."
The noble Baroness said: In moving Amendment No. 381, I shall speak also to the seven other amendments in this group tabled in my name and that of my noble friend Lord Howe. They relate to the complaints procedures in the Bill and follow on from the issues to which the noble Lord, Lord Clement-Jones, has just spoken. We broadly welcome the new provisions, but they raise several issues. A number of the amendments that I shall discuss have been inspired by very helpful briefing provided by the citizens advice bureau, which has considerable expertise and experience in handling complaints.
Amendment No. 381 would add to the list of areas for complaint set out in Clause 111(1),
"the provision of health care services by any other person or body".
The scheme covers complaints about English NHS bodies or about healthcare arranged by an NHS body, for example. But it does not cover healthcare provided wholly in the independent sector.
The separation between the independent sector and the NHS is not as clear-cut as it once was. Many NHS patients are treated in independent hospitals under PCT contracts, which are designed to cut waiting lists. But, alongside that, the independent sector treats rapidly increasing numbers of people on a self-paid basis, where patients have been failed by the NHS.
As there are no complaints mechanisms for those treated privately in the independent sector, there are anomalies. In an independent sector hospital, patient A, who is funded by the PCT, has access to the complaints mechanisms under the Bill, while patient B in the next room, who is paying for himself, has no such access. In an NHS hospital, the patients in both the public ward and the private patient wing are covered. Under Amendment No. 381, all providers of healthcare would be covered, whatever the setting.
Amendment No. 382 would allow regulations under Clause 111 to deal with how correspondence relating to complaints is dealt with, including adherence to time limits for replying substantively to correspondence.
The Citizens Advice Bureau reported to us that NHS bodies say that they have resolved complaints within the current 20-day time-scale when all they have done is send a letter of response. The time-scales can be much greater when complainants write follow-up letters, perhaps seeking more information or challenging an initial response. I hope that the Minister will see the need for being able to handle that issue effectively in the regulations.
Amendments Nos. 387, 388 and 391 are probing amendments concerned with who and what can be excluded from the complaints scheme by regulations. They would amend or leave out paragraphs (b), (c) and (0 of Clause 113(2). There are concerns that certain kinds of care, such as continuing care, could be excluded from the complaints mechanisms. That would raise significant issues, which is why it is so important to understand for what the Secretary of State intends to use the regulation-making powers. If he has no clear idea at this stage, we may well suggest at a later stage, on other than a probing basis, that the powers in Clause 113 need to be curtailed.
Amendment No. 390 would add a new paragraph to allow regulations under Clause 113 to cover oral hearings. It is unclear from the Bill whether the Government envisage oral hearings at all, the circumstances in which they might take place, and, if they take place, the procedures to be followed. There is a fear that complaints will be seen as an impersonal bureaucratic process in which the complainant's voice is not heard.
Will the Minister say whether the Government envisage oral hearings, and, if so, in what circumstances? How will CHAI equip itself to handle the function of complaint-handling, which is so very
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different from its core functions of audit and inspection? In particular, will CHAI have regard to model rules issued by the Council of Tribunals?
The different aspects of the new complaints procedures are not mere detail. It is important that we understand whether the Government's regulations will result in procedures that meet legitimate aspirations.
Lastly, Amendments Nos. 384 and 385 deal with regulations under Clauses 111 and 112. The amendments require the affirmative procedure—one of our old friends returns to the Committee. The regulations are not only about the who, what and when of complaints. They also cover issues such as payments of compensation under Clause 113(3) and can also, under Clause 113(4), override the duty of confidentiality and dispense with consent to the use of personal data. That is why we propose the affirmative procedure in Amendments Nos. 384 and 385. It is vital that there is proper scrutiny of the provisions. I beg to move.
11 p.m.
Baroness Barker: I rise to speak to Amendment No. 383 and the others in this group standing in my name and that of the noble Lord, Lord Clement-Jones. Amendment No. 383 raises the issue of oral hearings. As the noble Baroness, Lady Noakes, said, the amendments have been framed and informed by the work of the CAB and other organisations that have a great deal of experience of helping people through the Byzantine NHS complaints procedure. It is no exaggeration to say that when the Bill was in its formative stages, some feared that what would be wished on NHS patients and those undergoing social care was the worst of the NHS complaints procedures. I accept that a great deal of work has been done—in the ICAS pilot, for example, which ran for most of last year.
It has become evident to many people who work in this field that the facility to have an oral hearing is not only desirable in some cases—for the providers of services and patients—but essential. The people for whom it is most essential are those for whom English is not their first language, who find it easier to have an oral rather than written interview. That is why it is an important ability to have within the Bill.
As the noble Baroness, Lady Noakes, said, the time scales must be realistic for the work to be done, but they must also be adhered to. There have been many examples when the NHS has obeyed the letter of the existing rules by simply sending out a missive within the deadline—the classic bureaucratic way of getting round the imposition of a date—but not actually resolving the matter. We believe that time scales should be realistic but should be adhered to.
We also believe that, when time scales have been badly missed and abused, there should be a penalty on the NHS body concerned. Therefore, we propose an upscaling system in which matters that are not dealt with within the right time go up to another level such as the strategic health authority.

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Finally, a great deal has been done over the past few years to ensure that information about one's right to complain is more available. A notice that one has the right to complain is something that one now regularly sees in NHS premises. However, details of how to go about complaining or resolving issues are often not advertised. That is of primary importance and is the force behind our amendments in this group.
Baroness Andrews: This is an important group of amendments which I shall try to put in context. They are concerned to ensure that the complaints procedures are accessible, timely and as exhaustive as possible; that nothing appropriate is excluded; and that everyone who uses health and social services is as well informed as possible and involved appropriately so that everyone gets the satisfactory outcome that they want. That is largely what Chapter 9 of the Bill sets out to do. In particular, Clause 113 sets out in very general terms the framework within which the complaints procedure will be constructed and which will be covered in more detail in accompanying regulations and in guidance.
I should outline some of the improvements that we are trying to make to the system. We are aiming to make the system more flexible; to improve local resolution of complaints; to make the resolution of complaints truly independent; to ensure that information about complaints and the causes of complaints are an integral part of the system; and to make the procedures for complaints about health and social services as compatible as possible so that from the complainant's point of view there is a seamless process with a single access point. That is very important. So we fully understand the intention of these amendments.
I shall take the amendments in numerical order. In moving Amendment No. 381, the noble Baroness, Lady Noakes, pointed to what she saw as discrepancies in the treatment of complaints regarding private and National Health Service care. Amendment No. 381 seeks to ensure that the complaints procedure is comprehensive and covers healthcare services provided by third parties. It will do that in any event. The NHS complaints procedure has always been about providing patients, or someone on their behalf, with the right to complain if they are not happy with the treatment. When a patient is treated through arrangements made by NHS bodies, even if their care is not provided by an NHS body, it is right that they should be able to have their complaints addressed under the NHS complaints procedure.
Subsection (l)(b) of Clause 111 already makes provision for that by covering healthcare by or for an English NHS body or cross-border SHA. That means that healthcare provided by third parties—that is, primary care practitioners and independent providers - will be covered by the complaints procedure. I should, however, add that this procedure is designed to deal with complaints about the NHS and NHS patients only. Private healthcare is covered in separate regulations which are associated with the National Care Standards Commission.
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I should advise the noble Baroness that this amendment would also have the unintentional effect of extending the Secretary of State's regulation-making power to, for example, Welsh NHS trusts and local health boards as the amendment as drafted is not geographically limited to England and is not in any way linked to Clause lll(l)(a), which limits the Secretary of State's regulation-making power to English NHS bodies and cross-border SHAs. To extend the Secretary of State's regulation-making power in this way would be inconsistent with the regulation-making power given to the Assembly under Clause 111 (2). So the amendment would put a small fly in the ointment in that respect.
Baroness Noakes: I thank the Minister for giving way. As there are various points to raise it might be easier if we dealt with them as we went along. Let us contrast the position of a private patient in an independent hospital who went there on a self-pay basis because the NHS waiting lists were too long with that of someone admitted for whatever reason to the private wing of an NHS hospital. The NHS patient would be dealt with by the NHS complaints system whereas the other would be dealt with by a completely different system that originates in the National Care Standards Commission. Does the Minister think that that is logical?
Baroness Andrews: It is certainly comprehensive. Both sets of patients have a right of complaint and a recourse. That is what we are aiming to achieve.
I turn to Amendment No. 382 and the issue of time limits. In reply to the noble Baroness, Lady Barker, we want the reformed complaints procedure to include time scales for dealing with complaints. I take her point regarding the CAB, which has a lot of experience in this field. Of course, it is reasonable that we address time limits. I agree with the noble Baroness that there must be a balance between imposing a time-scale that makes it impossible for complaints to be resolved properly and making sure that things are not allowed to drift. Therefore, we intend to consult widely on that aspect of regulations. In particular, we shall talk to bodies, such as the CAB, about that. We have identified time-scales as a key area where we need to gather feedback.
The current wording of Clause 113(2)(e) is sufficient to provide for regulations to set out the detail with regard to time-scales. On those grounds, Amendment No. 382 does not add value to the Bill. Obviously, CHAI will be consulting widely, not least with the Council on Tribunals, on the advice and experience that people can bring to bear on the process.
I turn now to the form of the complaint. Amendment No. 383 seeks to ensure that regulations detailing the complaints procedure provide for a right to an oral hearing, where appropriate. Amendment No. 390 also seeks to ensure that the regulations specify the circumstances in which a complaint is subject to an oral hearing. Not only do we recognise that the amendments have been made with the best of intentions, but we envisage oral hearings.

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We recognise that the parties involved in a complaint must have the opportunity to put their case. We intend to provide in regulations for an oral hearing where it is the best option for making progress and where local resolution has not been achieved. Clause 113(2)(e) enables regulations to provide for that. While on the face of it the amendments have the best intentions of the parties involved at heart, there would be some perverse consequences because it would also reduce the complainant's control over what happens rather than empowering him to make the right choice.
I must stress that we are envisaging a much more involving process. Complainants, in the stages supported by the appropriate bodies, would choose the right and most appropriate route forward for them. We want them involved as far as possible to determine how they think the situation can best be resolved. We are trying to focus proactively on seeking to facilitate resolution at various stages rather than on an invariable progression where certain procedures kick in at certain stages. Rather than specifying rigidly when an oral hearing must take place, we want to set out options for resolution after the local stage. That will allow CHAI and CSCI more flexibility to decide with the complainant the best way forward.
It may be that an independent panel involving oral representation might be one way forward if that is what people want, but there may also be other options. With that explanation, I hope that the noble Baroness will not press the amendment.
Amendments Nos. 387, 388 and 391 seek to ensure that no one who has cause to complain is left out or is prevented from doing so. I agree that the language in the regulations needs some untangling. One of the main objectives behind the provisions that we are proposing for complaints is to make the procedures more rather than less accessible. For example, we intend that people who wish to make a complaint should be able to do so just once rather than being sent all over the place. The provisions in Clause 113(5) are designed to allow for that.
The amendments seek to remove the ability for regulations to set clear parameters for the complaints procedures in terms of the complaints which may not be made or which need not be considered under matters which are excluded from consideration. Each of those three subtly different points serves a different purpose.
Obviously, we have to set parameters, but we have no intention of limiting the proper investigation of complaints about the NHS or social care. What we intend in the clauses is to ensure that the procedures are used appropriately so that, for example, other routes resolving issues such as misconduct can operate effectively alongside the complaints procedure.
Perhaps I may go through the provisions very quickly. Subsection (2)(b) simply reflects the fact that we will need to be clear about what people can and cannot complain about using the procedures. For example, social services procedures should be for complaints about social care functions. Subsection
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(2)(c) is subtly different from (2)(b) in that it allows for regulations to provide for some complaints that have been made not to be considered, rather than excluding them from being made in the first place. This might cover circumstances where an alternative route might be more appropriate to achieve resolution. For example, if a complaint brings misconduct to light, the relevant disciplinary procedures may need to be brought into play. The paragraph does not give NHS bodies or local authorities a way out of investigating a complaint properly. However, to remove it would take away the necessary flexibility.
11.15p.m.
Baroness Noakes: I thank the Minister for giving way once again. She read out the provisions of paragraphs (b), (c) and (f), but what I sought to tease out was whether they would be used for excluding certain kinds of care. Can the Minister assure the Committee that those paragraphs will not be used by the Government for excluding the provision of long-term or other specific types of care? At face value, they appear capable of doing that.
Baroness Andrews: Everyone capable of being in receipt of an NHS service must be covered. I can give the noble Baroness the assurances that she seeks.
Paragraph (f) allows regulations to be made about matters which are excluded from consideration. For example, the NHS procedure has always been about patients having the right to complain if they are not happy with the treatment or service they have received. That is right, but other people either in or using NHS facilities, such as contractors, need to be excluded. Of course they can raise their concerns and have them addressed, but that is not the purpose behind the procedure provided for here. These are safeguards to deal with the exceptions.
Baroness Barker: I am sorry to interrupt the noble Baroness at this late hour, but within the important and extremely detailed explanation of the clause that she is giving the Committee, can she confirm whether this would enable people to make complaints when they have been excluded from the provision of NHS care to which they feel that they should be entitled? I cite, for example, continuing NHS care.
Baroness Andrews: If someone has been excluded from NHS care, there would be a reason for that, along with a history and a background to the case. Presumably those would form the basis of the complaint. If I am wrong then I shall certainly write to the noble Baroness, but I see no reason why they should be excluded from making a complaint.
I turn to Amendment No. 389. We believe that this is too detailed a point to be covered by the Bill. Again this refers to time-scales, but it is only reasonable that the reformed complaints procedure should include time-scales. However, it is right that there should be measures in place to deal with complaints that are allowed to drift unnecessarily, and we want to stop that from happening. These would include referring

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complaints to the next stage of the procedure if they are not dealt with in a reasonable time. Again, we intend to address this in regulations and the wording of Clause 111(3) and (4) will allow for appropriate provision to be made. We feel, therefore, that the amendment is unnecessary.
However, I am sympathetic to the spirit of Amendment No. 393. It is essential for information to be freely available in order for the complaints procedures to be as accessible as we would all wish. I want to reassure noble Lords that we intend to make provision about this in regulations. Although I believe that we can achieve that without the addition of this specific provision, I am minded to take it away for further consideration with a view to coming back with an amendment on Report.
The general powers to make regulations about the handling of complaints contained in Clauses 111(1) and 112(1) are sufficient to allow regulations to make provision about making information for the complaints procedure available to the public, but as I have said, I sympathise with the purpose of the proposed amendment.
I turn now to the final set of amendments in the grouping, Amendments Nos. 384 and 385. These amendments would have the effect of requiring that regulations made under these clauses are dealt with under the affirmative resolution procedure. We do not believe that that is either desirable or necessary. We have set out a clear programme for reforming the way in which complaints are made under the complaints procedure and we have been open about the reasons for that reform. Indeed, the whole history of the process over the past two years was set out in the departmental paper, NHS complaints procedure reform: making things right, published in March this year. It also marks the way forward. So our intentions have been made clear and, similarly, how they are to be covered is set out in the Bill.
I emphasise that this is the first time that the detail of the complaints procedures will be subject to regulation. This improves the current provision and sets the procedures apart from the procedure of handling complaints under Sections 24D and 26 of the Children Act 1989 and the requirements for complaints procedures set out in regulations applying to providers of family healthcare services. These have been subject to a variety of directions and we are changing that. We intend that the regulations will cover who may complain and about what; what they can expect by way of a full and prompt response; and, if necessary, a review of the complaint by a body which will be completely independent of the organisation complained about. The regulations will also place responsibility with health and social care organisations for making effective responses and, as I have said, we are committed to involving all stakeholders.
The noble Baroness asked about data protection. These bodies will be subject to the Data Protection Act and people will be asked to consent to the disclosure of appropriate information when they make a complaint
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to CHAI and CSCI. There will be no question of that provision being overridden. Regulations will provide for information to be obtained from the NHS and local government, but that will have to be consistent with the provisions of the Data Protection Act.
The Government wrote a longer response when this issue was raised by the Delegated Powers and Regulatory Reform Committee which I shall be very happy to copy to the noble Baroness. So we have been open about the changes we intend to make.
Another problem which would be raised by the affirmative resolution procedure is that the amendments fail to take account of the devolution settlement. Under these clauses the Assembly will be given the power to make regulations detailing how health and social care complaints procedures will operate in Wales. It would therefore be inappropriate for the draft regulations to have to be approved by both Houses before the Assembly can make them.
I am sorry to have spoken at such length. These are difficult and complicated amendments which I hope the noble Baroness will not press.
Baroness Noakes: I thank the Minister for that extremely comprehensive response and for some good news. I am pleased that the Government will cover the issue of timescales, that they will consult widely, that oral hearings will be included and that the complainants will be involved in selecting the process. All of those provisions are good news. I thank the Minister for the assurance that issues such as long-term care will not be excluded—indeed, that all care offered or not offered by the NHS will be covered by these regulations.
That leaves only a couple of areas where the Minister's response was a little disappointing. The Minister said that the position of the independent sector is comprehensive, but that preserves artificial distinctions between the independent sector and the NHS which, as I tried to demonstrate in opening, are already blurred. We need to think about that issue further.
We shall also need to think further about the affirmative procedure, in particular because of the use of personal data. I completely take the Minister's point about the Assembly and devolution, which often slips one's mind. But there are some important issues in regard to the regulation-making powers, the use of personal data and compensation payments. The Minister rang a bell when she referred to the fact that this is the first time complaints regulations are being put together. Perhaps the first set of regulations should themselves be subject to the affirmative procedure because that is where so much will be set out. I should like to think further about personal data and I should be grateful for the letter that the Minister has offered to me. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 382 to 384 not moved.]
Clause 111 agreed to.

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Clause 112 [Complaints about social services]:
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 384A:
Page 47, line 38, leave out paragraph (b).
The noble Lord said: We now come to the clause dealing with complaints about social services. Very simply, Clause 112 effectively repeals the existing complaints procedure for local authority social services set out in existing social services legislation and replaces it with a new process. Under subsection (2), CSCI is one of the bodies that can consider complaints.
Local authorities and their representative body have concerns about the inclusion of CSCI in that list. It is interesting to note that under subsection (4), there is no reference to CSCI as far as concerns Wales. It is only for English local authorities that CSCI is included. That is a significant omission. As the previous social services inspector did not have a role in considering complaints, there is a lack of understanding as to why CSCI, the SSI's successor, should assume that role. There may simply be a feeling of symmetry—as CHAI deals with health services, so CSCI should deal with social services. I do not believe that that should necessarily be the case, and look forward to what the Minister has to say. I beg to move.
Baroness Andrews: We were slightly surprised by this amendment because it runs counter to the very principles of what we are trying to achieve. We can usually count on the noble Lord to share our vision.
I hope I have made it clear so far that the overriding principle of what we are trying to achieve is to make the process easier and more accessible, and to increase the chance of achieving the right outcomes for people. CSCI is crucial to that. It will enable the review stage to be geared to the circumstances of each case. Making Things Right, which was published earlier this year, contains a solid argument about why CSCI is important for doing just that.
Nobody knows better than people like the noble Baroness, Lady Barker, that the key difficulty with the current procedures is that they make it difficult for complainants, health bodies and local authorities to deal with complaints that cut across health and social care services. We have only to reflect, as we do so often in this House, on the implications of the Community Care (Delayed Discharges etc.) Act.
The way in which the review stages are handled by health and social services, being different in their structure and in their process, makes it very difficult to deal collectively with complaints of that sort. That is why we are looking for a parallel process for single points of access and a very strong independent review mechanism at the top. That is the role of the two new commissions in the independent review stage. The provisions we have made that will allow them to co-operate and work on each other's behalf are crucial to improving that.
The feedback from the major consultation exercise on Making Things Right contained a very articulate demand for greater independence. Some complainants
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did not understand how, as is the case at present, a review panel convened by a local authority, which might include two councillors from the authority being complained about, can be truly independent. But that is not to criticise the review panels, which have worked extremely well. Independent panels may well continue to be part of the potential armoury for resolving complaints under the new proposals. We are trying to focus the local resolution in such a way as to separate the local investigation from the review mechanism so that, on the ground, people can do the job which they can do best because they are nearer the information and circumstances and will be able to address those issues. Local authorities may have concerns on the matter, but we want the review panel to support the process on the ground.
For the reasons that I have offered, we would be very reluctant for the amendment to be adopted, because it would lead to greater disparity between the way in which complaints are handled in health and social care, rather than bringing the process together. It would not bring the desired overview and independence that we want to see. I hope that the noble Lord will take the case put on those two grounds and withdraw the amendment.
11.30 p.m.
Lord Clement-Jones: I thank the Minister for her reply. Far be it from me to obstruct the onward march of progress or arrest the grand designs that are clearly in the Minister's mind, as we march forward with health and social care in tandem, towards a bright and glorious future. There is something rather Stakhanovite about the whole concept.
I have not yet had an answer as to why Wales should be different. If the grand design that is so desirable in England is being achieved, why not in Wales?
Baroness Andrews: It is a dreadful oversight on my part—normally I answer the questions about Wales first. As far as I know, Wales is different because it has a tradition of lay members serving on independent panels. That is how Wales wants to continue, in the spirit of devolution, respecting the strength of local organisers and the independence of the lay members. That is obviously what we want for Wales.
Lord Clement-Jones: The Minister is almost making my argument for me—it is very interesting. She said that review panels were working extremely well, but here she says that the Welsh in their wisdom—and at this point I assume Welsh ancestry—are extremely sensible in staying with the things that they know work. That is why local authorities are keen on the review panels rather than on CSCI.
I do not want to take the matter further tonight, but clearly there are quite a number of questions to be answered between now and Report. I shall read the Minister's comments carefully. Far be it from me to stop the onward march of progress, as described by the Minister. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Baroness Andrews Baroness Andrews moved Amendments Nos. 384B and 384C:
Page 48, line 12, leave out from second "to" to "(and" in line 15 and insert "a Local Commissioner under Part 3 of the Local Government Act 1974 (c. 7) who is a member of the Commission for Local Administration in England for him to consider whether to investigate the complaint or matter under that Part"
Page 48, line 17, leave out from second "to" to end of line 19 and insert "a Local Commissioner under Part 3 of the Local Government Act 1974 (c. 7) who is a member of the Commission for Local Administration in Wales for him to consider whether to investigate the complaint or matter under that Part"
On Question, amendments agreed to.
[Amendment No. 385 not moved.]
Clause 112, as amended, agreed to.
Clause 113 [Complaints regulations: supplementary']:
[Amendments Nos. 386 to 393 not moved.]
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 394:
Page 48, line 39, at end insert—
"( ) The provision that may be made under subsection (2)(g) includes the provision for a report about a complaint to recommend the making of an ex gratia payment in respect of injuries sustained, loss of earnings or expenses incurred as a consequence of the incident or incidents complained about."
The noble Lord said: The amendment is similar to the one that the noble Baroness, Lady Finlay of Llandaff, would have moved. It will not have escaped the Minister's notice that we on these Benches have tabled a number of different amendments at different stages that are in the nature of probing amendments, to test how limited the provisions are.
The purport of this amendment is to enable compensation or ex gratia payments to be made to an upper value which would be determined by regulations in respect of lesser injuries caused as a result of avoidable mistakes. This would remove the need for people to take legal action on a smaller scale, the costs of which usually exceed any award made. I am sure the Minister is aware of some of the rather horrifying statistics about the cost of some smaller claims.
At present there is an inconsistent approach dependent largely on the personality of the complainant and/or the chief executive of the trust concerned regarding whether ex gratia payments will be considered. Some complainants are told that there is no possibility of this while others are successful in being offered a payment.
An expert group convened by the Scottish Executive recently recommended bringing ex gratia payments formally into the application of the NHS complaints procedure there. In England the Clinical Disputes Forum recommended that compensation should be available through the NHS complaints procedure. I look forward to hearing what the Minister has to say in that respect. I beg to move.
Baroness Andrews: Amendment No. 394 seeks to make financial redress available through the complaints procedure. NHS bodies are already allowed to make ex gratia payments where legal
1406
liability would otherwise be conceded. NHS bodies will continue to have that flexibility under the reformed NHS complaints procedure.
The amendment as drafted would also apply to social care. There is already provision for payments to be made by local authorities where they consider that their actions amount to maladministration. The issue of compensation for acts of clinical negligence has traditionally been a matter for the courts unless the body concerned accepts liability and reaches a settlement out of court.
The CMO has carried out an extensive review of the options for reforming the way in which the NHS handles clinical negligence claims. The results of the review were published on 30th June in the report, Making Amends. Under the proposals an NHS redress scheme will be established to speed up the process and to offer care and compensation under certain circumstances without the necessity to go to court. This new redress scheme will be closely aligned to the new NHS complaints procedure. For example, it is proposed that making a claim for compensation would no longer be a disqualification from pursuing a complaint—something I am sure we would all welcome. Subject to the outcome of the consultation, we shall need to take account of that in determining how the complaints procedure operates so that it is aligned effectively with the NHS redress scheme. I hope that with that explanation the noble Lord will withdraw the amendment.
Lord Clement-Jones: I thank the noble Baroness for that reply. The interface between clinical negligence cases and the complaints system is an important matter. I do not believe that we yet have a very clear picture established of exactly how that will operate. The noble Baroness says that there is an existing power to make ex gratia payments. When a body such as the Consumers' Association wants clarification on that, it demonstrates that there is a lack of communication or a lack of clarity regarding the powers. When the regulations are made, or when communications are made about the content of the regulations and what the complaints system consists of, it is important to tell potential complainants and the public that trusts have the relevant power. At the moment that is not clear. However, the clarification was useful. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 394A:
Page 48, line 40, leave out subsection (3).
The noble Lord said: This is a straightforward amendment which is designed to discover the current intentions regarding the requirement of payment of a fee to the body hearing complaints under Clause 113.
We on these Benches are concerned that individuals bringing complaints may be required to pay a fee to the body that hears their complaint. Of course, vexatious or dishonest complaints may be a problem for some social services departments, but charging complainants is not necessarily the best way to deal

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with that. It would be important for the Minister to explain why the Government think that a charging power is required in the circumstances. I beg to move.
Baroness Andrews: There was inevitably a cost at the review stage of the existing complaints procedure, which was traditionally borne by the relevant authorities. We recognise that there will be a cost to the commissions in carrying out their functions of independently considering complaints. That is a logical outcome. Therefore, there will need to be a mechanism for covering the costs associated with the work.
I assure Members of the Committee that no scheme of charging will be implemented without a full analysis of the impact, and we would intend to consult on that. For example, we would want any scheme of charges to contribute to the aim of resolving complaints locally, and certainly not to hinder it. Over the coming months, the Department of Health and the shadow commissions will analyse the costs associated with review activity and drawing up proposals for a charging structure that fairly reflects the transfer of the function to the commissions. Those proposals will be subject to full consultation. I should also emphasise that there will be no intention of charging complainants at all. We are talking about charges that are, as it were, costs paid to the commission by the relevant authorities.
We do not want to pre-empt the analysis but will want to see some link between, for example, charging and workload, so that if bodies or authorities that have fewer cases need further action to achieve a resolution, they do not bear a disproportionate burden. We will be looking at the full range of options as to how the provisions can be made to work sensibly.
Lord Clement-Jones: I thank the Minister for that reply. She has made it pretty clear that her interpretation of Clause 113(3) is that the complainant will not be charged. The thrust of the amendment was very much to make sure that the complainant was not charged. Furthermore, she said that there would be analysis of the costs of current review mechanisms and full consultation about how any recovery of those costs from the players involved—presumably local authorities and so on—will be levied. That is a pretty satisfactory reply, so I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 395 not moved.]
[Amendment No. 396 had been withdrawn from the Marshalled List.]
Clause 113 agreed to.
Clause 114 [Further consideration of representations under the Children Act 1989]:
Lord Warner Lord Warner moved Amendments Nos. 396A to 396E:
Page 50, line 3, leave out "the Commission for Local Administration" and insert "a Local Commissioner"
Page 50, line 4, leave out "it" and insert "him"
Page 50, line 33, leave out "the Commission for Local Administration" and insert "a Local Commissioner"
Page 50, line 34, leave out "it" and insert "him"
Page 50, line 38, at end insert—
"(5) In this section, "Local Commissioner in England" means a Local Commissioner under Part 3 of the Local Government Act 1974 (c. 7), who is a member of the Commission for Local Administration in England.""
On Question, amendments agreed to.
Clause 114, as amended, agreed to.
Clauses 115 to 118 agreed to.
11.45 p.m.
Clause 119 [Reviews and investigations]:
[Amendment No. 397 not moved.]
Clause 119 agreed to.
Clause 120 agreed to.
Clause 121 [Power to assist]:
Baroness Noakes Baroness Noakes moved Amendment No. 398:
Page 54, line 2, leave out subsection (1).
The noble Baroness said: I shall be extremely brief with this probing amendment. Why would CHAI or CSCI want to assist other bodies rather than concentrate on their core functions? Subsection (1), which this amendment seeks to delete, gives them power to assist any other public body in the United Kingdom with the purposes of that body's functions— and they can charge fees for it. Surely CHAI and CSCI are not going to set up consultancy businesses. If they are going to help other people, whether or not for payment, will the Minister also explain why they are confined to helping United Kingdom public bodies? Are there no bodies outside the UK which, perhaps for a fee, might benefit from the advice of CHAI or CSCI? Why should bodies outside the public sector—for example, charities or voluntary bodies—be excluded from this beneficial interaction with CHAI or CSCI? I am puzzled by this clause, which is why we have tabled the amendment. I beg to move.
Lord Warner: I hope that all will be revealed. The power in Clause 121 builds on a tradition of co-operation between inspectorates that is necessary to ensure effective and joined up working between agencies. A recent example of such co-operation would be the street crimes initiative, which saw the Social Services Inspectorate working closely with a number of other public bodies, including Home Office inspectorates and Ofsted. The drafting of the Bill enables CHAI and CSCI to assist other public bodies where they believe that it is appropriate for them to do so. This will be a decision for the inspectorates based on whether they believe there is any social or healthcare implication for them in the work that is being carried out by another public body.
CSCI will be involved in the Local Services Inspectorates Forum, which brings together a range of government inspectorates to consider common issues and discuss their work programmes relating to local government issues. This includes the Audit

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Commission, Ofsted, the Benefit Fraud Inspectorate and the Prisons Inspectorate. Clearly we expect CSCI and CHAI to be sensitive to the burden of inspection placed on organisations that are the subject of work that they will do with other public bodies. CHAI will be under a duty to work jointly with CSCI and other public bodies and where it considers that would promote further efficiency and cost effectiveness. CHAI's vision document clearly indicates the commission's willingness to work in real partnership with others, particularly in the area of common data collection. It would be a significant constraint on the powers of CHAI and CSCI if they were not able to assist and co-operate with other agencies in this way and would undermine effective joint working.
We have drawn the powers reasonably widely to enable that area of co-operation to operate effectively, due to the wide range of public bodies that may carry out work that has health and social care implications, and to which CHAI and CSCI will therefore need to be able to provide assistance. They are not going into the consultancy business, but we do want them to work on a basis of co-operation with others when they think that that is necessary in order to discharge their primary functions. I hope that explains to the noble Baroness why we have set out the terms of the Bill in this way.
Baroness Noakes: I thank the Minister for that helpful response. I shall read it carefully, but it appears to answer the points that I raised. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 121 agreed to.
Clause 122 agreed to.
Clause 123 [Arrangements with Ministers etc: CSCI]:
[Amendment No. 399 not moved.]
Clause 123 agreed to.
Clauses 124 and 125 agreed to.
Clause 126 [Reports: CHAI]:
Earl Howe Earl Howe moved Amendment No. 400:
Page 56, line 5, at end insert—
"( ) an updated regulatory impact statement showing the effect, including the estimated financial effect, of the CHAI's activities on those bodies which it covers."
The noble Earl said: In moving Amendment No. 400, I shall speak also to Amendment No. 401. These amendments relate to regulatory burdens. I suggest that both CHAI and CSCI should be required to publish at the end of each financial year a full regulatory impact assessment of all their activities.
I hope that the Government will consider the amendment seriously. The proposal is good discipline and good practice. None of us can assume that CHAI or CSCI will reduce the regulatory burden of their inspections, or hope that they will follow good practice spontaneously. We need to see on a regular basis whether this occurs.
Employers and staff alike across the public and private sectors are becoming more aware and more resentful of unnecessary and intrusive red tape and
1410
bureaucracy. In the health service, the amount of time that clinicians and managers spend filling in forms and justifying themselves to others is time taken from the care of patients. If we can achieve a reduction in the burden of data gathering and compliance on front-line NHS staff, and on those who work in the social care sector, we should do so.
The regulatory impact assessment for the Bill as it relates to CHAI and CSCI speaks in optimistic terms about the advantages of creating two new inspectorates and the reduction in burdens that this will bring to front-line staff. It speaks of,
"less work for frontline staff following co-ordinated visits and requests for information".
It also speaks of,
"co-ordination of work where the inspectorates might be looking at the same provider, e.g. care trusts".
We need to ensure that these are not just pious hopes. There may indeed be a net reduction in the number of bodies—although if one counts the Welsh inspectorate, I am not sure that that is literally true. Despite what the Minister may say, there are possibilities for duplicated inspection work in border areas between England and Wales. If that happens, burdens will increase, not decrease.
Quite apart from that, the regulatory burden can equally be influenced by the manner and style in which inspectorates work. There needs to be a formal requirement to enable us to ensure that good intentions are translated into practice.
I have one question relating to the regulatory impact on independent health and social care providers. The regulatory impact assessment states:
"Independent health providers and registered social care providers are currently inspected by the NCSC against national minimum standards … to ensure national consistency of service provisions. This function is to be taken over by the new inspectorates … The inspection procedures may change when CHAI and CSCI become operational, but providers will not be subject to different standards as a result of the changes".
However, it also states:
"In future, providers may be subject to new service standards".
I did not understand what the reference to "new service standards" means and the implications it carries for regulatory burdens on the private sector. I beg to move.
Lord Warner: On the last point, national standards will be set out by the Secretary of State in relation to health care. We have already discussed the issue of convergence between the independent sector and the NHS. I believe that the wording is related to that, but I will check and write to the noble Earl.
Before the Bill's introduction, the department led an assessment of the likely regulatory impact of its provisions. It consulted widely, including with key stakeholders, the devolved administrations, the regulatory impact unit of the Cabinet Office and the small business service at the Department for Trade and Industry. A full regulatory impact assessment of the Bill in its entirety was published on 14th March this year and a copy is available in the Library. I shall not

1411
quote from it, other than to point out that, overall, the inspectorate's clauses in particular are considered to have a limited impact, if any, on businesses and the voluntary organisations. I know that the noble Earl has looked at the document.
Both organisations are being established with duties to discharge their functions economically, efficiently and effectively. It is therefore our belief and expectation, in line with the recent Office of Public Sector Review report on inspection and external review, that CHAI and CSCI will bring about a reduction in the burdens of inspection placed upon frontline staff, freeing up time that could be better spent caring for patients and other service users.
In CHAI's Vision statement, Professor Sir Ian Kennedy notes that organisations which provide healthcare are currently assessed by different inspectorates without proper co-ordination. CHAI therefore already proposes to develop techniques of assessment which reduce the need for it routinely to visit each and every organisation. Clearly, there is still some way for CHAI to go in developing such methodologies, but we are confident that progress will be made in that area.
The Better Regulation Task Force report recommends that regulators should make available for public scrutiny a regulatory impact assessment on all new major policies and/or initiatives. It does not recommend an annual regulatory impact assessment. However, I shall study the amendment further in the light of the task force report to be sure and shall consider whether anything more needs to be done. But, at present, we do not believe that the amendment is necessary.
Earl Howe: I am grateful to the Minister for agreeing to have a second look at this issue. I believe that it is important. Whenever we set up new regulatory mechanisms, it should be more or less a reflex action to examine how the regulatory impact of those bodies can be contained, however well intentioned the new system is to be. I look forward to hearing, perhaps at a later stage, what the Minister concludes. But, for now, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 126 agreed to.
Clause 127 [Reports: CSCI]:
[Amendment No. 401 not moved.]
Clause 127 agreed to.
Clause 128 [Duty to have regard to government policy: CHAI]:
Earl Howe Earl Howe moved Amendment No. 402:
Page 56, line 27, leave out "must" and insert "may"
The noble Earl said: In moving Amendment No. 402, I shall speak to the other amendments grouped with it. In this group, we return to the principal theme of our Committee proceedings on Part 2—namely, the independence of CHAI and CSCI. Clause 128 confers a power of direction over CHAI by the Secretary of State.
A clause of this kind, tucked in towards the tail end of Part 2 and headed "Relationship with government", speaks volumes for the intentions of Ministers. Here, we have an open acknowledgement that, like it or not, CHAI will be beholden to the Government, as and when Ministers so choose, in every aspect of its operations. Its functions as an adjudicator of the quality of care and of the economy and efficiency of the provision of healthcare, as a guardian of the rights of children, as a publisher of data and as an assessor of the performance rating of trusts may not be for CHAI to perform as it seems fit but, instead, may be subject to the Government's take.
I am extremely troubled that a provision such as this should be in the Bill. It is quite unnecessary. Government policy, referred to in subsection (1), can mean many things. It can mean something as benign as a drive to get rid of mixed-sex wards or, alternatively, something that is political, such as waiting-list targets, delayed-discharge penalties and A&E waiting times.
However, the obligation to have regard to government policy is a strict provision. I have no problem with CHAI having regard to government policy. No regulatory body such as this one can possibly operate in a cocoon. Government policy is a fact of life, and CHAI must live with it. But that is different from saying that CHAI should be subject to a power of direction. The only point of a power of direction is to influence someone's actions. What possible ways are there for the Secretary of State to influence the actions of CHAI which would not amount to direct interference in CHAI's mode of working or the results that it published?
The confidence that patients and the public need to have in what CHAI says and the way that it does its business is one of the most important considerations in this legislation. People very definitely do not want to see CHAI as just another arm of government, doing the Government's dirty work and implementing the Government's political agenda. But that is what will happen if the Secretary of State is allowed to direct what it does.
In my amendment I suggest that the Secretary of State should by all means have the power to bring matters of policy to the attention of CHAI, but that that should be as far as it goes as regards any direct political influence over its operational role. The same comments apply in equal measure to CSCI. I shall not take up the time of the Committee to repeat the argument. Knowing the Minister, he is bound to present the Committee with some rational-sounding justification for these provisions, but I doubt I am persuadable.
Perhaps I may move briefly to Amendments Nos. 407 and 408. In Clauses 130 and 131 we see once again the over-intrusion of the Secretary of State in the governance of CHAI and CSCI. It is conceivable and the Bill is right to allow for the possibility that CHAI or CSCI may fail to perform their functions in some major way. Were that unlikely eventuality to come about, there has to be a means to address it. The Government's answer here is to give the Secretary of

1413
State a power of direction over each body so that he can tell it what to do or even what not to do. A power of direction may be the obvious device to bring out the tool kit in those circumstances, but I am distinctly uncomfortable with it. We all know about powers of direction; the point is not so much that they are used, but that they are there at all. The existence of a completely unfettered power of the Secretary of State to say that CHAI or CSCI were failing in the discharge of their functions gives him a large degree of psychological influence over the way that each body operates.
We should note that the Secretary of State does not even have to be satisfied as to the failure of CHAI or CSCI. He has to consider only that they are failing, which is much weaker. If the Government set up a body that does not work, the proper course is one of two things: to return to Parliament to introduce something else or, as my amendments propose, to get Parliament to approve the direction. To leave the Bill as it is will effectively give the Secretary of State a Sword of Damocles that he can wield almost whenever he feels like it. For bodies that are operationally independent, or supposedly so, that is simply not appropriate. Those concerns go to the heart of our misgivings on Part 2 of the Bill. I beg to move.
Midnight
Lord Warner: I hope that I shall continue to sound rational at this time of night, as the noble Earl helpfully suggested. On Amendments Nos. 402 to 406, we have pointed out on a number of occasions that there are no general powers in the Bill to issue directions to either commission because we want to ensure that they are independent from government. A Minister will be able to intervene only in the specific circumstances of either body being judged to be failing in the discharge of any of its functions or under the power that we are discussing here which allows him to issue directions that require the commissions to have regard to matters of government policy. Such a power cannot be used to direct the commission on any specific matter that the Secretary of State chooses. It can be used only to issue a direction on a specific area of policy such as that CHAI and CSCI should not make a profit from any fees that they charge and that they must have regard to general government principles of good accounting in respect of such fees.
In the absence of a general direction-making power, it is essential that the Secretary of State has a power to ensure that proper democratic accountability is maintained. I do not believe that it is unreasonable that CHAI and CSCI should be expected to have regard to the broad health and social care policies of the elected government of the day when carrying out their functions. In contrast to the independent approach that we have taken for CHAI and CSCI, most other NDPBs, such as the Audit Commission, can be directed by Ministers about any matter, so they have been put in a special category. The duty to have regard to Government policy is the same duty as
1414
appears in the legislation that established Ofsted. I am sure that the Committee would not regard Ofsted as a body that lacks independence.
Amendment No. 406A seeks to remove the Secretary of State's power to vary or revoke any direction that he has given under this clause. I am sure that noble Lords are aware that this is a standard provision that is attached to any direction-making power. To remove such a provision would be extremely restrictive for the Secretary of State, but such a restriction would not be beneficial to CSCI. It could potentially lead to the inspectorate needing to have regard to an aspect: of government policy that was long out of date, and which no longer reflected the reality of the social care world that it was inspecting. Clearly, that would be wrong.
Amendments Nos. 407 and 408 would place a duty on the Secretary of State to consult Parliament before he issued a direction to either commission. The procedure proposed by the amendments for issuing a direction to Parliament would be time consuming and a bureaucratic and unnecessary waste of parliamentary time. In the extremely unlikely event that either commission failed to carry out its duties, or failed to carry them out properly, it would be important that corrective action could be taken quickly. Let us suppose that because of the pressures of work one of the commissions refused to undertake an investigation into a Climbié case or a Shipman case, would the public think it right that an investigation was held up while we discussed the matter in the House? We think that is not so and that the Secretary of State should have these powers of direction in these rather special circumstances. I suggest that the amendment is withdrawn.
Earl Howe: I should have thought that in the kind of case cited by the Minister—the Victoria Climbié situation—where the inspectorate declined to carry out an investigation there are already separate powers in the Bill which the Government could use. I am not at all certain that these powers of direction are necessary.
The Minister may seek to present these various powers as limited in scope. I do not read them in that way. They are widely drawn. While the Government may have only modest horizons about the use of these powers that might not necessarily apply to a future government who leaf through the Act, as it will be, and find that they have very considerable influence with which to play.
Nevertheless, I can see that the Government are not going to be moved on this issue, which I find a pity, and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 403 and 404 not moved.]
Clause 128 agreed to.
Clause 129 [Duty to have regard to government policy: CSCI]:
[Amendments Nos. 405 to 406A not moved.]
Clause 129 agreed to.

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Clause 130 [Failure in discharge of functions: CHAI]:
[Amendment No. 407 not moved.]
Clause 130 agreed to.
Clause 131 [Failure in discharge of functions: CSCI]:
[Amendment No. 408 not moved.]
Clause 131 agreed to.
Clauses 132 to 143 agreed to.
Schedule 9 [Part 2: minor and consequential amendments]:
Lord Warner Lord Warner moved Amendments Nos. 408A and 408B:
Page 139, line 1, at end insert—
"Superannuation Act 1972 (c. 11)
4A In Schedule 1 to the Superannuation Act 1972 (kinds of employment in relation to which pension schemes may be made), at the appropriate places in the list of "Other Bodies" insert the following entries—
"The Commission for Healthcare Audit and Inspection.";
"The Commission for Social Care Inspection."
Page 144, line 21, at end insert— "25A In section 55(3)(e)—

(a) for "the Commission" substitute "the CSCI";

(b) for "section 31 or 46 of this Act" substitute "section 31 of this Act or section 86 or 96 of the Health and Social Care (Community Health and Standards) Act 2003".

On Question, amendments agreed to. Schedule 9, as amended, agreed to.
Clause 144 [Interpretation of Part 2]:
[Amendment No. 409 had been withdrawn from the Marshalled List.]
Clause 144 agreed to.
Clause 145 agreed to.
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 409A:
Before Clause 146, insert the following new clause—
"REGULATIONS UNDER PART 3
regulations may be made under this Part unless a draft of the regulations has been laid before Parliament and approved by a resolution of each House of Parliament."
The noble Lord said: Listening to two days of debate on Part 2 gave me plenty of time to reflect that CHAI is rather inelegantly named because it is, of course, Turkish for the word "tea". We may consider that at the Bill's next stage. Be that as it may, we now turn to something entirely different.
Ever since 1948, insurance claims against motorists resulting in NHS treatment to the plaintiff have given rise to a proportion of the settlement money going to the National Health Service for treatment costs. The basis of that agreement has been changed twice: once in 1989; and again in 1999.
Part 3 of the Bill changes the basis again and extends the scheme for NHS charges from just motor insurance to include both employers' liability, personal liability and, I believe, product liability claims. The 1989 Act need not concern us—at least for
1416
the moment; although I note that my noble friend Lord Hunt of Wirral, whom I am delighted has joined us with his expertise, has an interest in it—but the 1999 Act, which the Bill replaces lock, stock and barrel, most certainly does.
When the latter Act was a Bill before your Lordships' House, the noble Lord, Lord Clement-Jones, will perhaps remember asking at Second Reading whether the National Health Service might recoup its costs in cases where personal injury was paid. The then Minister, the noble Lord, Lord Hunt of Kings Heath, replied that the Bill,
"does not provide a mechanism to extend those rights"
—incidentally, those rights were the rights of the NHS to claim money from compensation payments for motor injuries. He continued, rather strangely:
"by stealth".—[Official Report, 2/2/99; col. 1459.]
Those were unfortunate words. In the modern political lexicon, "stealth" is always accompanied by the word "tax".
When a similar point was put to the noble Lord in Committee, the then Minister said:
"We have acknowledged the commission's suggestion"
—that is, the one contained in the Law Commission's 1996 paper that proposed that the NHS should recover its costs in all cases of actionable personal injury—
"and we are considering it"'.—[Official Report, 18/2/99; col. 762.]
Four years is a fairly long time for consideration.
My first question is therefore: why now, if not that the Chancellor is scraping every barrel that he can find to fund the NHS without increasing income tax or VAT? Why do we find it buried well into the Bill and, even worse, do we find not one but eight different statutory instruments, subject to annulment, to launch it? Eight negative instruments? If that is not stealth, I do not know what is.
It is true that Members of this House are rather better at picking up negative instruments than are Members of another place, but no one would claim that the system is perfect. I hope that it will be a little better when we have the statutory instrument policy committee that we have been promised next Session. Nonetheless, orders following close on the discussion of a Bill have a better chance of scrutiny.
Unfortunately, that will not happen in this case. The Department of Trade and Industry and the Department for Work and Pensions have been sufficiently alarmed to launch an inquiry into the workings of employers' liability insurance and the premiums paid by employers, which, according to Zurich Insurance, the Association of British Insurers and the British Insurance Brokers Association, have increased on average by between 40 and 60 per cent since as recently as 2002. According to the regulatory impact assessment of the Bill, another 7 to 8 per cent will be added to employers' costs purely as a result of employers' liability.
That leads me to my next question: what figures does the Minister have for personal or product liability? In another place, the Minister of State said that the new scheme will not be brought into effect

1417
until after the investigation to which I referred has concluded. What is the prognosis? Are we to wait another four years before it sees the light of day?
In any event, that is why the amendment would make all the amendments proposed by this part of the Bill—not just those commented on adversely by the Delegated Powers and Regulatory Reform Committtee, whose objections I see are acceded to by the Minister in Amendment No. 474A—subject to affirmative resolution. I beg to move.
12.15 a.m.
Lord Clement-Jones: I support the noble Lord, Lord Skelmersdale, in his cogent introduction of the amendment. He mentioned that the Minister of State in the other place said that provisions on NHS costs recovery in the Health and Social Care Bill would not be implemented until the Government's work on employers' liability compulsory insurance was completed. That was in reply to my honourable friend Brian Cotter, the Liberal Democrat small business spokesman.
We feel strongly about the potential additional costs of compensation claims and the fact that at present, in the calculation of scale premiums for employers' liability, there is no ability or sensitivity to distinguish between different track records among the small business community. Much of the inquiry will be about how the insurance industry can get its act together in that respect. The noble Lord said that the Association of British Insurers reckons that the increases will be by as much as 8 per cent. That is a significant potential increase for small businesses.
In the circumstances, it seems peculiar that the Government are persevering with this part of the Bill, when it is contingent to such an extent on further work to be done by the DTI. An affirmative resolution must be required for the regulations provided for in the amendment.
Lord Warner: The noble Lord, Lord Skelmersdale, is clearly revitalised by not having had to participate in Parts 1 and 2 of the Bill. I am sure that I look a little jaded by comparison.
This is not just a stealth tax. On the contrary, it removes from the general taxpayer the burden of meeting some of the costs of treating the victims of another person's negligence and places it on the wrongdoer. Why should a man or woman in the street have to pay for the medical treatment of people injured at work because their employer failed to take adequate steps to protect them? If the proposal constituted stealth tax, the Law Commission participated in it, as it emerged from a Law Commission review quite a long time ago.
In response to the noble Lord's questions about cost, the estimated losses are £75 million for employers' liability and £75 million for public liability. An estimate has not been made for product liability because the numbers are extremely low.
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A first-stage report, setting out the findings of the ELCI review, was published on 3rd June. A further report is to be issued in the autumn, so the review has not yet been completed. We are taking steps to include the arrangements in this legislation, but we have indicated that we will not implement it until the outcome of the final review is settled.
Much was made of the issue of affirmative resolution. Amendments Nos. 409A and 475 would make the regulation-making powers in Part 3 subject to the affirmative resolution procedure. Amendment No. 477 would have the same effect for the commencement order for Part 3.
With only one or two exceptions, the regulation-making powers in Part 3 are not new. Rather, they mirror—sometimes word for word—powers that already exist in the Road Traffic (NHS Charges) Act 1999. All regulations made under the terms of that Act are subject to negative resolution procedures.
In most cases, the Government can see no valid reason why regulations made under the Bill—which will be largely concerned with the detailed and technical administration of the scheme—should be treated any differently. I said "in most cases", as there are two possible exceptions. The report on the Bill from the Delegated Powers and Regulatory Reform Committee recommended that the regulation-making powers in Clauses 146(12) and 149(2) should be subject to affirmative procedures.
On Clause 146(12), the Government accept the Committee's view that the powers granted there could be exercised, but the Government are less convinced about Clause 149(2). The Committee has suggested that because the scope of the expanded scheme is so much greater than that of the existing scheme, the powers to set the amounts payable should be subject to affirmative resolution.
In fact, the way in which payments will be established is intended to be no different at all from the way in which it is done now. There will be three simple tariffs. As now, there will be a single, one-off payment for outpatient treatment, however many appointments are needed, and a daily rate payment for inpatient treatment, irrespective of what that treatment actually entails. In addition, because the scheme will allow recovery of ambulance costs, we will also need to establish a new tariff, again a single one-off payment, to cover ambulance journeys. It is definitely not the intention that a wide range of different payments for different treatments or different types of personal injury will be developed. So the scope of these powers and the way that the Government intend to use them, is the same as the corresponding powers that already exist in the Road Traffic (NHS Charges) Act 1999.
Nevertheless, the Government want to be as constructive as possible in their response to the Committee's recommendations. As a result, I have tabled Amendment No. 474A which would make all regulations made under Clause 146(12) subject to affirmative resolution procedures. It would also make the first set of regulations made under Clause 149(2) subject to affirmative resolution procedures, but

1419
subsequent regulations subject to the negative procedures. That would give Parliament the opportunity to debate tariff-setting and so forth at the outset and reassure both this House and the other place that the scheme was being appropriately set up.
Amendments Nos. 474A and 474B also give effect to another of the Committee's recommendations by amending Clause 196, which gives the Secretary of State—or in relation to the "Welsh" parts of the Bill, the National Assembly for Wales—the power to make supplementary, incidental and consequential provisions, including provision modifying any Act or subordinate legislation, when such modification is necessary to the supplemental, incidental or consequential provision made. Subsection (c) of government Amendment No. 474A requires any order or regulations made under the Bill that will have the effect of amending or repealing part of any other Act to be subject to affirmative resolution procedures. In the light of those assurances, I hope that the noble Lord will be able to withdraw his amendment.
Lord Skelmersdale: I wonder what the Delegated Powers and Regulatory Reform Committee has got that I have not got. It is quite clear from its report that it did not consider the vital fact that motor insurance is a compulsory insurance whereas the other two are, to a great extent, optional. That is why I have voiced my worries on what will be in the eight sets of regulations.
The noble Lord, Lord Clement-Jones, spoke about the Government putting the cart before the horse. They have certainly done that. At this stage, we are being asked to buy a pig in a poke. By the end of our discussions, I hope to discover just how much of a pig it is. For now, there is no point in pursuing the matter and I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 146 [Liability to pay NHS charges]:
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 410:
Page 64, line 18, after "person" insert "otherwise than during or as a consequence of NHS treatment"
The noble Lord said: In moving this amendment, I speak to Amendments Nos. 411 and 413. Amendments Nos. 410 and 411 in the name of the noble Baronesses, Lady Finlay and Lady Barker, and the noble Lord, Lord Clement-Jones, are variations of the same theme. Over the past few days, the Committee has been awash with health professionals, whether clinicians or managers, both paid and unpaid. Every one of them knows that clinical mistakes, even disasters, occur from time to time in the diagnosis and treatment of accidents and the diseases associated with them. In those hopefully rare cases, NHS employees are actionable in law and doctors' liability insurance premiums have risen alarmingly in recent years as we have become a much more litigious society. As drafted, the Bill would make the treatment of a patient in one hospital, say a special hospital, for medical mistakes made in another one, liable to NHS charges.
The only good that that would do would be to push money from one hospital to another. It is a nonsense that the NHS should pay money to itself.
Amendment No. 413 is slightly different but also refers to those bodies outside the NHS who should not be liable to pay. I refer noble Lords to the comments made earlier about the costs of insurance premiums and their increase as a result of the implementation of Part 3. That these extra costs should be borne by not-for-profit organisations, charitable organisations or private sports clubs must surely be wrong in principle. I beg to move.
Lord Clement-Jones: I rise to speak to Amendment No. 411. Subject to the considerations raised in our debate on the previous group of amendments, we generally support the principle of recovering NHS hospital costs incurred treating patients who receive personal injury compensation for an accident. However, extending the scheme to clinical negligence cases could well be counter-productive and liable to set community doctor, primary care doctor and hospital doctor against each other. Under the proposals, a GP working in the NHS who is sued by a patient for a delay in diagnosing a condition that was subsequently picked up by A&E and treated in hospital could be liable to pay tens of thousands of pounds to the hospital. That cannot be the intention of these provisions. The proposals contradict the Kennedy report recommendations on open reporting and are very likely to damage doctor morale. I look forward to hearing what the Minister has to say.
Lord Warner: I would suggest that the NHS is subject to the same health and safety obligations as any other organisation and it cannot be right that it should not be subject to the same penalties if it fails in those obligations. Similarly, the NHS owes a duty of care to the patients, and can and should be brought to task when it fails in that duty of care through negligence. Why should one hospital have to bear the cost of another's failings? The principle is exactly the same for the NHS as for any other compensator. We do not believe that it is inappropriate for one NHS body to have to bear the proper costs of its wrongdoings, even where that means paying NHS charges to another NHS body.
As for general practitioners and other primary care providers, the principle applies just as much. If they have failed to the extent that a patient or anyone else to whom they owe a liability has had to have hospital treatment to put matters right, then how can it be wrong for them, or their insurers, to have to bear the proper cost of their negligence? We recognise, however, that it would be bureaucratic stupidity for a hospital to have to pay NHS charges to itself where it is both compensator and the hospital providing treatment, which is why Schedule 10 explicitly excludes from the scheme compensation payments made in those circumstances.
Turning to private treatment, I find the idea that private practitioners should not have to contribute to the costs to the NHS of putting right their mistakes

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even more difficult to understand. I am sure that we have all heard stories of treatment at a private hospital that has gone wrong, with the unfortunate patient having to be rushed to the nearest NHS hospital to have the problem put right. Where a successful compensation claim is made in such cases against the private practitioner, surely it must be right that the practitioner, or rather their professional indemnity organisation, should also pay towards the costs incurred by the NHS.
Moving on to Amendment No. 413, I can readily understand the reasoning behind this amendment. Nevertheless, the fact remains that these organisations are responsible for the health and well-being of those who work for them and make use of their facilities. The principle behind the expansion of the NHS costs recovery scheme is to make those who cause injury to others through their own negligence bear the full range of costs of that negligence. That applies equally to the organisations identified in the amendment as to any commercial or other organisation.
Some of those organisations are pretty substantial organisations employing very large numbers of people. In some cases, they have responsibilities also for volunteers who spend time on fundraising activities. I find it difficult to understand how when these bodies have the same obligations as any other organisation they should not also be subject to the same penalties for failing to meet those obligations, which is all that this particular scheme does. There would also be practical difficulties. The Compensation Recovery Unit currently administers the existing road traffic recovery system and the benefits recovery scheme. We envisage that it would also operate the new expanded cost recovery system, acting on behalf of the Secretary of State and Scottish Ministers as it does now.
The amendment would require the unit to identify the body or organisation on whose behalf the compensation payment was being made by the insurer. At present, that is not information which the Compensation Recovery Unit automatically seeks. It would be a significant additional administrative burden for it to have to do so.
12.30 a.m.
Lord Skelmersdale: I elicited more from this group of amendments than I could possibly have expected. Perhaps the Minister will answer me a simple question. What happens now if an ambulance runs over someone and he or she is treated in an NHS hospital?
Lord Warner: The principles that I have enunciated are exactly the same. It depends whether the compensation payment is made in respect of that action. It depends whether it is a separate organisation from the organisation that is treating the injured person.
Lord Skelmersdale: The trouble with attempting to précis is that rather more is read into my words than I intended. Clearly, I meant a situation in which the ambulance service subsequently has to pay—through
1422
its insurers—the person that it ran over and that person was treated in an NHS hospital. However, this is not the time of night to get into an argument, although I could pursue this issue quite a long way. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hunt of Wirralmoved Amendment No. 410A:
Page 64, line 18, after "person" insert "as the result of an accident"
The noble Lord said: It is probably unnecessary for me to repeat my interest, but I shall place on record that I am senior partner of Beachcroft Wansbroughs, a law firm which deals with a great deal of the work that we are now discussing. I hope that I might be able to assist the Minister to improve some of the provisions. It is in that context that I move Amendment No. 410A, which, together with Amendment No. 417A, would insert the words,
"as the result of an accident".
Presently, Clause 146(l)(a), states that,
"a person makes a compensation payment to or in respect of any other person … in consequence of any injury, whether physical or psychological, suffered by the injured person".
The words that I seek to insert—
"as the result of an accident"—
would follow.
The addition of those words is to clarify the intention of the Bill so far as the exclusion of disease claims is concerned. The wording reflects that which has already been adopted and approved by the Civil Procedure Rule Committee in the pre-action protocol relating to occupational diseases. I must tell the Minister that lawyers and insurers alike are concerned at the use of the word "injury" without the qualification which I seek to add. On its own, the word "injury" is not sufficiently clear.
I know that that was the language used in previous legislation. But the legislation concentrated on road traffic accidents where the only likely cause of injury was an accident. As has been discussed in immediate past debates, the Government are now proposing to extend the recoupment provisions to employers' liability and other actions, which makes the risk of misinterpretation much greater. I know that insurers welcome the intention of the Government to exclude occupational disease claims, but I hope that the wording could be clarified so as to remove any uncertainty.
I made the Minister aware of the comments 1 was going to make in moving these two amendments, and he has kindly written some brief words in response. The problem, however, is that the note which I have just received, and which other noble Lords may not have seen, raises more questions than it answers.. In his letter the Minister said:
"Amendments 410A and 417A would seek to limit the scheme to injuries arising from accidents. A dictionary definition of 'accident' is: 'an event without apparent cause or which is unforeseen'".

1423
Unfortunately, some injuries can be foreseen or even intended and we do not want them to be excluded from the scheme.
I suppose that any normal person who wanted to know what a word means would rush to the Oxford English Dictionary, but they forget that such is the legal system in this wonderful country of ours—I do not want to be quixotically chivalrous—that it is founded on the basis of ratio decidendi and stare decisis, which means it does not matter what is set out in the Oxford English Dictionary and that all that matters is what the judiciary has interpreted the words to mean over many years.
I have to tell the Minister that to resort to the dictionary to find out the meaning of "accident" is to ignore, I have calculated, 38 cases in the Judicial Committee of the House of Lords which have concentrated on defining the word "accident". Indeed, there is a whole range of cases which seek to interpret the word in a different way from the words "an accident". While I do not want to labour the point, I hope that the Minister will accept from me that, although the dictionary definition appears to be a rational interpretation, it is certainly not the one set out in the House of Lords case of Fenton v Thorley & Co Ltd in 1903 and Warner v Couchman in 1912. Indeed Halsbury 's Laws of England states that what is defined by this word is not entirely clear.
Turning to "illness" or "injury", personal injury includes any disease, any harm to a person's physical or mental condition, as well as pregnancy. So far as concerns food legislation, injury includes any impairment, whether permanent or temporary.
What I seek the Minister to acknowledge is that we might think about this a little more deeply than the rather brief dismissal in his letter of the points I sought to make, although I am sure that he did so with the best of intentions. Perhaps I may press him at least to reflect on what I have said and, rather than resort to the Oxford English Dictionary, we might resort to a little considered legal opinion before we set in stone the final wording in Clause 146. I beg to move.
Lord Skelmersdale: I said that my noble friend Lord Hunt of Wirral was an expert in this area and he has most certainly just proved that. However, it occurs to me that the words,
"as the result of an accident",
he seeks to insert seem eminently sensible. I hope that the Minister will agree.
Lord Warner: It is with some trepidation that I rise to respond to the amendment, in particular at this time of night. I am sorry I went anywhere near the Oxford English Dictionary and I promise to do better in future.
The definition of "accident" may not cover all the incidents which give rise to injuries. The amendments could have the effect of limiting the types of injury which would attract NHS cost recovery. This could limit the effectiveness of the scheme. The health and safety inspectors might draw attention to
1424
shortcomings in particular health and safety issues and no action would be taken. So there was a foreseeable set of circumstances which led to an injury which was not totally unforeseen.
I understand the case law referred to by the noble Lord, but the issues are not quite as straightforward as he suggests. However, I have what I hope he will take as a constructive suggestion, not only on this amendment but on a number of his other amendments. These are very detailed and complex issues in some cases—as the noble Lord said, there is case law on some of them which needs to be explored—and I wonder whether he will accept an invitation to a meeting. I can certainly bring along my lawyers, complete with their reference documents, and departmental officials, and perhaps we can thrash out some of the detailed issues outside the Committee, well before Report stage. I would then write to him confirming the outcome and he would perhaps achieve more satisfaction in that way. The offer is made in a constructive spirit.
Lord Hunt of Wirral: I was not saying the issue was straightforward; I was saying the opposite. I readily accept the Minister's generous offer. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 411 not moved.]
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 412:
Page 65, line 4, at end insert "or an ex gratia payment"
The noble Lord said: The Minister has referred to cases where compensation is not paid on the basis of liability. None the less, although it is fairly rare, ex gratia payments are made on occasion where liability is not accepted. Why have the Government excluded them from the scheme—or is the word "voluntarily" on line 7 of the page supposed to include ex gratia payments? I beg to move.
Lord Warner: The Government agree entirely that ex gratia payments should not attract NHS costs where there is no liability or alleged liability for the injury caused, but there is no need for this to be specified on the face of the Bill as the amendment would do.
Clause 146(3) defines a compensation payment as one made by someone who is, or is alleged to be, liable for the injury caused. Dare I say it again? I have checked the definition of "ex gratia" in the dictionary. It states:
"given as a favour or gratuitously where no legal obligation exists".
If a person who is not liable or alleged to be liable for the injury makes a payment gratuitously, that payment cannot meet the definition of a compensation payment and therefore cannot attract NHS charges under the scheme. That is the explanation.
Lord Skelmersdale: It seems I have produced a gratuitous amendment. I am grateful for the Minister's

1425
explanation that it is not necessary to make express provision for ex gratia payments. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 413 not moved.]
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 414:
Page 65, line 12, leave out subsection (6).
The noble Lord said: This is unashamedly a probing amendment. Subsection (6) of the clause qualifies subsection (5) in a rather confusing manner—a matter to which my noble friend Lord Hunt has just referred. Subsection (5) states, in effect, that diseases— asbestosis was cited in another place—do not count. That is absolutely crystal clear.
However, subsection (6) goes on to say, "Hang on a minute. Diseases do count in particular circumstances". If an injury for which compensation is due results subsequently in a disease, it does count. An example might be a head injury where the physical damage is repaired but the patient goes on to get meningitis, which can continue for years and years. That would count as continuing treatment for the head injury and would be subject to continuing NHS charges up to the cap, which, we are told, is likely to be £33,000. We await one of these dreaded orders to tell us how much it will actually be under the new scheme.
Surely to goodness it is not beyond the wit of the draftsmen to ally these two subsections to make the Bill easier to read for the likes of my noble friend and his colleagues in and on the fringes of the industry. At the very least, the Minister should consider Amendment No. 415, which would move up the words "attributable to the injury", prùcised—always a good thing in legislation, pace my noble friend Lord Renton—from further down the page. I beg to move.
12.45 a.m.
Lord Warner: As the noble Lord said, subsections (5) and (6) were inserted into the Bill by the Government in another place in response to concerns expressed by the Opposition as the need to make it explicit on the face of the Bill that compensation payments in respect of diseases, particularly industrial diseases, should not be included in the NHS costs recovery scheme.
These two subsections make it clear that what you might call freestanding diseases are not included in the scheme, but that diseases directly attributable to an injury are. So, for example, a compensation payment made in respect of an industrial disease such as asbestosis would not attract NHS charges under this scheme. However, a compensation payment made to someone who suffers tetanus as a result of a badly broken leg would attract charges, not just for the treatment of the broken leg but also for the treatment of the tetanus. That is the distinction that we are making here.
This seemed a fair and responsible distinction to make. The disease would not have occurred if the injury had not happened, so it is reasonable that the compensator should be held responsible for the cost of treating it.
1426
Amendment No. 414 would, in effect, remove this distinction so that no disease, not even those directly resulting from an injury, could be included within the scope of the scheme. This seems manifestly unfair and defeats the underpinning principle of the scheme.
I was not entirely clear what Amendment No. 415 was intended to achieve. Subsection (6) is already worded so as to make it clear that only disease consequent upon an injury is included, so it does not need to be specifically reiterated, as set out in the amendment. It seems to me that these amendments are entirely unnecessary.
Lord Skelmersdale: I cannot have explained myself very well, can I? I am suggesting that the Minister should go back to the draftsmen and reconsider subsections (5) and (6) because I should have thought they could be encapsulated into a single subsection. That was the sole and total purpose of my amendment. They clearly were not meant to be included in the Bill. I am sure that, on reflection, the noble Lord will appreciate it.
Again, there is no point in having an argument at this time of night. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 415 not moved.]
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 416:
Page 65, line 19, after second "treatment" insert "carried out within 12 months of the injury for which compensation has been paid"
The noble Lord said: Treatment of injuries, perhaps multiple fractures, or certainly a broken back, can go on for years, sometimes for the rest of a patient's life. Under this clause, as the Minister has so far explained it to us, treatment charges would continue, subject only to the cap.
Let us consider an insured horse rider who has a bad fall, suffers a broken back and becomes a paraplegic. After a period, he or she will go home and, almost invariably, suffer pressure sores, for example. I wonder if the noble Lord has ever seen a bad pressure sore, where the flesh is so eaten away that it has to be cut out, sometimes right down to the bone, over significantly wide areas of the body. Treatment for these would indeed be consequent on injury. It really is not right that an insurance company should be liable for a person's lifetime. Therefore, we have put down this amendment to restrict to 12 months the length of time for which payment is due. I beg to move.
Lord Warner: I do not feel strong enough to trade gruesome experiences at this time of night with the noble Lord.
Clause 149(5)(a) allows for the regulations setting the amounts to be paid under the scheme to include setting a maximum sum payable. That reflects existing powers in the Road Traffic (NHS Charges) Act 1999. The Government have used those powers to set a cap on costs under the road traffic scheme, currently

1427
standing at £33,000. That represents roughly 60 days' in-patient treatment using the current daily tariff for such payments under the scheme.
The Government intend to make the same arrangements under the expanded scheme, so that compensators will always know the maximum amount they might have to pay in any particular case. In the vast majority of cases, the liability will be much lower than the cap, because the injured person will not be in hospital for very long, or indeed may not be hospitalised at all.
Noble Lords will appreciate from this that the amendment would, in the more serious cases requiring long-term hospitalisation, make liability much greater not only than is currently the case but also than is currently the Government's intention. That may not be the noble Lord's intention, but it would be the effect of the amendment. We are trying to give certainty to compensators under the scheme.
Lord Skelmersdale: Certainty is all very well, and I appreciate that the Minister is trying. However, the 12 months suggested by the amendment is a very certain period. Saying that the amount due is up to £33,000 is very elastic and does not produce certainty at all. I cannot accept that argument. I wish to test the opinion of the Committee.
12.52 p.m.
On Question, Whether the said amendment (No. 416) shall be agreed to?
Their Lordships divided: Contents, 13; Not-Contents, 42.

Division No 3

CONTENTS

Attlee, E.

Howe, E.

Barker, B.

Hunt of Wirral, L.

Blatch, B.

Noakes, B.[Teller]

Onslow, E.

Clement-Jones, L.

Roper, L.

Colwyn, L.

Skelmersdale, L. [Teller]

Cox, B.

Strathclyde, L.

NOT-CONTENTS

Acton, L.

Farrington of Ribbleton, B.

Amos, B. (Lord President)

Gilbert, L.

Andrews, B.

Golding, B.

Archer of Sandwell, L.

Gordon of Strathblane, L.

Bach, L.

Grocott, L. [Teller]

Bassam of Brighton, L.

Hilton of Eggardon, B.

Brett, L.

Hollis of Heigham, B.

Brooke of Alverthorpe, L.

Hoyle, L.

Burlison, L.

Hughes of Woodside, L.

Campbell-Savours, L.

Hunt of Kings Heath, L.

Carter, L.

Jones, L.

Chandos, V.

Jordan, L.

Crawley, B.

McIntosh of Haringey, L.

Davies of Coity, L.

McIntosh of Hudnall, B.

Davies of Oldham, L. [Teller]

MacKenzie of Culkein, L.

Dean of Thornton-le-Fylde, B.

Mitchell, L.

Desai, L.

Pendry, L.

Evans of Temple Guiting, L.

Plant of Highfield, L.

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Randall of St. Budeaux, L.

Warner, L.

Sawyer, L.

Warwick of Undercliffe, B.

Simon, V.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.
1.2 a.m.
Lord Strathclyde: It is now just after one o'clock in the morning. The noble Lord the Government Chief Whip is still in the Committee. Does he realise that we have completed a page and a bit of amendments on the groupings list so far today, and that there is at least three-quarters of a page still to do?
We have an agreement in the House to try to aim for a 10 o'clock cut-off, which has been very difficult to achieve in recent weeks. We all understand why that is. However, it is now likely that we may have to run for another three or four hours. Might the noble Lord consider that we should continue for another hour this evening—that would bring us to four hours beyond the 10 o'clock cut-off—and then complete this Business on Thursday morning? That should give us enough time. It is a reasonable and sensible offer, and fits in entirely with the view taken by many Peers that doing Business at this hour of the morning is not only unreasonable, but not very effective.
Lord Grocott: I suggest that we see how the Committee proceeds. Believe me, I infinitely prefer to do our Business at a different time of day. I do not think it sensible to try to negotiate across the Dispatch Box. As I am here until I switch the lights off and put the cat out, I would be more than happy to have such discussions but, as the noble Lord knows, it is not sensible to try to have them on the Floor of the House.
The Earl of Onslow: Actually, I cannot see why that is not sensible. My noble friend has put forward a perfectly decent suggestion. If there is a bad reason for saying no, say no. Why cannot we all be let into the secret? It is a great myth that we cannot negotiate on the Floor of the House. What is Parliament for except negotiating across its Floors? I spoke earlier about exactly that point. I understand the difficulty that the noble Lord is in, because he and I had a civilised conversation outside where I think he understood me, and I him. The fault is in agreeing to stop at 10 o'clock. It would have been much wiser not to, and then we would have all accepted that occasionally these events are inevitable. They become unacceptable when the rules are that we only play cricket on a cricket pitch, and then suddenly because it is inconvenient to play cricket we have to play football—even though we have reached agreement. If we know that we can play cricket or football that is much fairer.
When one says that we will not go beyond 10 o'clock, half past 10, or 11 o'clock, that is fair enough. But then to go on very late is unreasonable— that has happened not only today but last week as

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well. I cannot see why the matter cannot be agreed across the Floor of the House. There is no great secret. We are not delving into great affairs of state. There just seems to be a sensible proposal put forward by a sensible man to a sensible man on the other side of the House.
Lord Roper: I believe that the Government Chief Whip has suggested that it would be useful to have further discussions outside the Chamber, and I hope that that suggestion, which seemed a good response to the Leader of the Opposition, is accepted.
[Amendment No. 417A not moved.]
On Question, Whether Clause 146 shall stand part of the Bill?
Lord Skelmersdale: I apologise to the Committee for not having tabled the request. Before we leave Clause 146, the notes on clauses assume that the new scheme will be operated by the Compensation Recovery Unit of the Benefits Agency as heretofore. Before the Health Act 1999 came into force a number of companies were contracted to the NHS to recover from insurance companies the cost of treating road accident victims under the provisions of existing legislation. Those organisations, of which by far the largest was the National Road Traffic Accident Claims Centre—NATRAC—were put summarily out of business without compensation when the 1999 Act came into force. They were obliged to pass to the CRU all their work in progress, again without payment.
Regarding this Bill, has a formal comparative analysis been made of the costs and benefits of a private versus public sector solution? The history of the CRU in that field is not a happy one, although I understand that the teething problems that they experienced initially have now been resolved. For example, I accept that the CRU has introduced a new computer programme to connect to all NHS trusts. But that does not make any difference to my question. Also, have the Government estimated the costs of collection compared to the estimated revenues of the NHS? We know from the notes on clauses and the regulatory impact assessment that about £150 million will be raised for the NHS. That is about half as much again as has been raised now.
Above all, why has the CRU not been benchmarked against private sector bids for cost effectiveness? What is the cost assumed to be for the CRU? Why have we not been informed in the various pieces of paper accompanying the Bill? I understand that the cost now to the CRU is £1.9 million to recover £100 million under the existing road traffic scheme. I ask again: what are the anticipated costs under the new scheme to recover an estimated £150 million?
Lord Warner: I do not have the detailed figures in my head at this time of night and I shall write to the noble Lord. However, I would ask him to accept that the CRU is an established organisation, so the relative costs of expanding it to cover the new scheme
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are fairly modest compared with the amounts of money that will be generated. I am happy to write to the noble Lord with more chapter and verse to try to reassure him on that matter.
Earl Howe: Was a benchmarking exercise done as regards private versus public sector solutions, or was an executive decision taken to run along with the present system?
Lord Warner: We have an established organisation where the overheads are effectively covered. However, I am not sure that I have in my head the exact answer to the noble Earl's point and 1 will cover it in the letter I promised to write to his noble friend.
Clause 146 agreed to.
Schedule 10 [Recovery of NHS charges: exempted payments]:
Lord Hunt of Wirral Lord Hunt of Wirral moved Amendment No. 417B:
Page 146, line 19, at end insert—
"Any payment made direct to a provider of treatment, whether that provider is a health service hospital or other organisation or individual providing treatment."
The noble Lord said: The grouping of Amendments Nos. 417B, 430D and 477ZA would under normal circumstances, were it not almost quarter past one in the morning, have given rise to a wide-ranging debate on rehabilitation. I know that many noble Lords wanted to participate in the debate, but sadly, because of the hour, they will not be able to do so.
Why is rehabilitation so important? It is because there is a genuine wish to try to overcome the serious problems caused to the economy by the rising bill having to be paid by industry for sickness and absence from work. Wearing my hat as president of the All-Party Group on Occupational Health and Safety, I can state that we recently had a report from the Trades Union Congress estimating that the cost of sickness and accidents at work was rising above £17,000 million a year. This is why rehabilitation is such a key issue.
It is also a key issue for the Government. Indeed, several departments have clearly said that rehabilitation is a priority. The Department for Work and Pensions stressed that in considering the future of employers' liability insurance. The Department of Health, in that outstandingly good report from the Chief Medical Officer, Making Amends, has already stressed the need for a wide-ranging policy on rehabilitation. The Treasury has several times indicated that we cannot go on in the way that we are with the rising cost. The Department of Trade and Industry has on a number of occasions demonstrated the need for a greater emphasis on rehabilitation. I know that in this debate many noble Lords would have wanted to stress the fact that at last there are a number of opportunities to do something fundamental about tackling rehabilitation.
Before I come to Amendment No. 477ZA, which seeks to implement one of the proposals that I know the Government are presently considering, perhaps I

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may deal with the detail of Amendment No. 417B. This amendment would insert into Schedule 10—that is, the list of exempt payments which a compensator can make without having to repay NHS treatment charges—a new item to cover treatment costs paid by the insurer direct. Particularly in the employers' liability field, where, of course, these provisions will take effect for the first time, there are schemes where employers or insurers themselves provide treatment services for anyone who is off work for a certain period of time, whether or not involved in a compensation claim. Therefore, it is clearly right that the Government should seek to encourage employers and their insurers to act in this positive way. Equally, it is right that new legislation should not discourage such measures.
I know from my own experience that under such schemes it is possible that an employer or an insurer will make a payment for treatment well before liability for the accident or the incident has been resolved. Surely it is in everyone's interests that that treatment should be provided so that the employee can get back to work as soon as practicable, where appropriate.
There are some wider issues here, too, which I have shared with the Minister. Those who run our specialist units for severe injuries—that is, spinal and head injuries—tell me that accident victims spend too long in those units, when better provision of treatment and other facilities could get them back into the community rather sooner. That has a knock-on effect on the ability of those units to treat other victims of such injuries. That, in turn, means that the victims find themselves being treated on non-specialist wards and not receiving the same level of care as they could in a specialised unit. With the best will in the world, that will lead to the worst possible outcome for those individuals.
Therefore, I would like to think that payments for rehabilitation treatment could join the list of exempt payments. In practice, the number of cases where such payments are made and where there is then no further compensation is not high. The other important factor is that, under the current version of the Bill, any payment for treatment would trigger liability for NHS charges. That might well cause some companies to pause before making payments for rehabilitation.
The Minister very kindly shared with me his general support for Amendment No. 417B by saying that it is entirely in line with the points made by the Department for Work and Pensions in its review of employers' liability compulsory insurance. But he added:
"In the sorts of cases we are talking about, it is more than likely that the injured person will have received NHS hospital treatment before they get to the stage of needing physiotherapy or other rehabilitation services".
He continued:
"We would not want to encourage compensators to try to persuade the injured to accept payment of treatment costs instead of a personal compensation payment to which they are fully entitled".
Perhaps I may respectfully say to the Minister that there is no wish on my part, or on the part of any of those to whom I have referred, to persuade the insured to accept some payment on treatment instead of compensation. That is not on the agenda. We are talking about payments made at an early stage to obtain the vital treatment necessary to get people back to work. We want to encourage those payments, even though liability issues have still to be sorted out and may well result in there being no liability at all and therefore no compensation. So it is very different from the description that the Minister has put in his letter to me. I want to see us encouraging insurers to pay for rehabilitation even though liability is not yet determined.
Amendment No. 430D would insert at the end of the provision requiring the Secretary of State to repay money recouped by the relevant NHS trust the words,
"as the result of accidents to which section 146 applies".
The intention of those words is to ensure that money received by the NHS trust as a consequence of these provisions is used for the supply of services to accident victims as a whole.
Previously I referred to rehabilitation. Surely it is one of the key drivers behind much of government policy that rehabilitation services should be improved and made more available. I would like to see—the Minister has explained to me that it is impossible to ring-fence the money—a greater vision on the part of those formulating policy as to how best to proceed. I shall not press the Minister for a detailed response tonight as it is far too late. I would not want to press him in that direction.
However, Amendment No. 477ZA seeks to repeal Section 2(4) of the Law Reform (Personal Injuries) Act 1948. That section provides that when a court is assessing a case for personal injury damages, no account at all should be made of the availability of treatment and care under the NHS. As a consequence of that section, many seriously injured accident victims are able to claim for the cost of professional care provided outside the NHS when the NHS still has an obligation to provide the necessary treatment. Many of those claimants will purchase such professional care so the money goes where it is intended—I am sure that is the overwhelming majority of cases—but research has shown that damages paid for nursing care are frequently not used for that purpose. Therefore, society is providing double compensation as it has to fund both the necessary insurance premiums and the cost of the National Health Service.
Earlier I referred to the Chief Medical Officer's report, Making Amends. That recommended the repeal of Section 2(4) in clinical negligence cases. I was most interested to read the noble and learned Lord the Lord Chancellor's response to a question from the noble Baroness, Lady Finlay of Llandaff, on 8th September 2003, HL4239, when the Lord Chancellor said:
"The report of the Chief Medical Officer, Making Amends, recommended that Section 2(4) of the Law Reform (Personal Injuries) Act 1948 should be amended so that the costs of future care in any award for clinical negligence made against the National Health Service should no longer reflect the cost of private treatment".
That recommendation is currently the subject of consultation. However, the answer continues, most importantly:
"The Government intends to consider the implications of the recommendation for personal injury claims generally".— [Official Report, 8/9/03; col. WA 2.]
That opens an opportunity that I hope the Government will take. I have deliberately inserted this proposed amendment in the repeals consequent upon the provisions setting up foundation hospitals. It is hoped that those hospitals will have greater financial and management freedom and, therefore, will be able to look at a range of schemes that could involve the private sector. There must be scope for finding ways to fund better and more effective rehabilitation facilities, certainly in those hospitals, in a way that would involve case managers—I declare an interest as chairman of the Case Management Society of the UK—who would ensure that those suffering injury are provided with the necessary support to bring about an early return to work where appropriate.
So, what I am really saying to the Minister—and I am not pressing him now—is that there is a real opportunity for some joined-up thinking on the part of the Government, rather than to perpetuate this system of seeking to recover comparatively small payments through this very intricate system that often, in many cases, costs just as much to collect as the actual money which is recovered. Surely, we could find a better way to have a really viable private finance initiative, which could join together with private sector finance and the National Health Service itself, in seeking to create far better rehabilitation services within NHS hospitals, so that people, however an injury may have been caused, will be able to get back to work at a much earlier stage. I beg to move.
Lord Warner: I listened with interest to the noble Lord's comments on rehabilitation. Certainly, there is no intention on the part of the Government to do other than to give people access to rehabilitation when they need it and to help them get back to work and health as quickly as possible. I want to put on record one simple sentence just to make matters clear. We do not think it right to allow the compensator to be able to avoid liability for the NHS charges incurred by virtue of agreeing to pay for an injured person's rehabilitation. That is a central point of the Bill.
In the middle of the voting arrangements on the amendment on which there was a vote, I offered to meet the noble Lord and officials and to go through all his amendments, including this one, in as constructive a way as possible, and then to confirm to him after a thorough and detailed discussion before Report where we can and cannot meet his particular
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concerns. That offer is extended to all his amendments. I hope that that will help the noble Lord and the Committee to make progress today. In that spirit, I shall not go through the detail— particularly as he did not press me—on his particular amendment. But we are happy to have a full discussion outside the Committee.
Baroness Blatch: The noble Lord has made what
sounds like a very generous offer. But the Official Report of the debates in this House are not for an "in club"—that is, the Members of this place: they are informative documents for doctors, nurses, all those involved in the health service and other interested bodies, including those who have taken a very serious interest in the Bill. It seems to me that the Government's response to amendments should be part of the Official Report and not simply a system of bypassing the need to debate these amendments in the Chamber. That is why amendments are tabled. There are people who are very interested in the Government's responses. I do not think that it should be left as a way of curtailing discussions today.
Lord Warner: I was trying to make the offer in a way that was helpful to the noble Lord and to Members of the Committee. If the noble Baroness and other Members would like me to go through the seven or eight pages of response, I am happy to. It will of course slow down other noble Lords who wish to discuss other amendments. I was trying to proceed in a way which meets the Committee's needs.
There will be every opportunity—the noble Baronesses are shaking their heads. If they could just listen to what I have to say. I am sure that the noble Lord, Lord Hunt, would not mind this: we would send a copy of the outcome of those discussions to all Members of the Committee. Please may I be allowed to continue? I listened patiently to the noble Baroness when she was speaking. She might do me the same courtesy.
I would actually send that letter to all Members of the Committee who have participated in the discussion. If the noble Lord and other Members were not content with that outcome, there would be nothing to stop them raising matters on Report on particular amendments so that we could discuss them further. However, if it is the wish of the Committee that I work my way through the seven pages, I am happy to do so.
Lord Hunt of Wirral: I am in a slightly difficult position, because I very much agree with my noble friend, but perhaps there is a way through. The Minister has made me a generous offer, which I accept quickly, before he withdraws it. However, perhaps I may do so in this context. Much of what I said about rehabilitation extends right across many provisions in the Bill: seeking to improve facilities in the National Health Service. There will therefore be many noble Lords who will want to participate in further debate on the matter.

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Perhaps the easiest way through is for me to proceed as the Minister suggested and return to a fuller debate on Report. That may meet my noble friend's point that so many interests are directly affected here. I remind the Minister that it does not affect only the Department of Health: key discussions are underway in the Department for Work and Pensions and the other departments I mentioned on the issue of rehabilitation.
This is not a party political issue. To give an example—perhaps the best one of all—everyone wants someone who has suffered a whiplash injury either at work or in a motor car not just to be sent home to await a GP's appointment and then, possibly, later physiotherapy; but to receive immediate treatment of the highest possible quality at the NHS hospital, so that he can get back to work and be on the road to recovery as quickly as possible.
That example involves a simple, minor accident. So much more important is it that someone who has suffered a serious spinal injury should not have to stay in a hospital bed receiving only one area of specialised treatment but should have a case manager allocated to him, who would make it his business to ensure that that seriously injured individual received the range of specialist advice and treatment that he needed, all combined at an early stage to produce a far better environment in which to return to normal health as quickly as possible.
I hope that in that way I have met the point made by my noble friend and at the same time retained the offer, which I accept, from the Minister. Perhaps we can return to the subject on Report. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Schedule 10 agreed to.
1.30 a.m.
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 418:
Before Clause 147, insert the following new clause—
"INSURANCE
Where compensation has been paid through an insurance policy, subject to paragraph 4 of Schedule 10, the insurer will not be liable for payment of NHS costs providing that he has provided the Compensation Recovery Unit with the name and address of the insured."
The noble Lord said: The amendment would meet what might loosely be called the "culprit pays" principle, although if the noble Lord, Lord Hunt, were setting the exams, it would probably be the "tortfeasor pays" principle, which seems to be the Government's implicit driving principle of this part of the Bill allowing for recovery of NHS charges. If the amendment were adopted, the party responsible for causing the harm would have to meet the full economic costs of their failings, rather than them being borne by the many policy-holders and so adding to the inflation of premiums, as under the current proposal.
The Minister's reply set out in his letter was very interesting. However, it is inaccurate to say that the proposal implies that people should be expected to pay potentially thousands of pounds on top of their insurance premiums as a result of an incident for which they considered themselves appropriately insured. It is designed to meet the situation where the insured has received a pay-out from an insurer. I beg to move.
Lord Warner Lord Warner Clause 146(2) is very specific:
"The person making the compensation payment is liable to pay the relevant NHS charges".
There is no provision in the Bill to transfer that liability to the person on whose behalf the compensation payment is made. But if costs cannot be recovered from the insurer who makes the compensation payment, they cannot be recovered from anyone. The amendment would be at odds with the Government's policy in that regard.
Our intention is made explicit in Clause 160, which specifies that where a qualifying compensation payment is made and an insurance policy covers a person's liability in respect of the injury, the policy must be treated as also covering any liability to pay NHS costs. The amendment is not appropriate, given the structure of the Bill. I hope that the noble Lord will reconsider his position.
Lord Clement-Jones: The Minister's answer seems eminently and quite consistently circular, but I am not surprised by it. I will not get any further on this wheel; otherwise, at this time of night, I will feel like a hamster. Nevertheless, I shall consider the Minister's reply and respond appropriately at a further stage in the Bill. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 147 [Applications for certificates of NHS charges]:
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 419:
Page 66, line 17, leave out "may" and insert "must"
The noble Lord said: There has been a lot of chat on the subject of a letter, especially since my noble friend Lord Hunt became involved in our discussion. It would have helped me and, I am sure, other Members of the Committee, to have received such a letter. After all, my name was attached to many of the amendments. I find it strange that I was not sent such a letter.
Lord Warner: The points that I made to the noble Lord, Lord Hunt, were inserted in the letter that I believe I sent to Front-Bench spokesmen and others

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who have spoken in these debates. If the noble Lord, Lord Skelmersdale, did not receive the letter, I can only apologise.
Baroness Noakes: It might help the noble Lord to know that I did not receive a letter either. I do not know what distribution system his office thinks he operates, but he did not achieve his intended effect.
Lord Warner: We tried to put the letters in Members' pigeonholes. Unless something went seriously wrong, we failed.
Lord Skelmersdale: As my noble friend Lady Blatch said, this is not a useful way of progressing a debate on a very technical subject, although 1 understand readily that that was the Minister's intention. For my part, 1 hope that he will not produce that procedure again.
Amendment No. 419 is rather odd. Instead of our usual "may/shall" discussions, which arise in virtually every Bill that we consider, this is a "may/must" amendment. This is a Government that love dicta. I do not particularly approve, but this is a case where what ought to have happened is vague in the extreme. Lines 16 and 17 of the clause state:
"Before a person makes a compensation payment in consequence of any injury suffered by an injured person, he may apply for a certificate to the Secretary of State".
The repayment scheme simply will not work unless the Secretary of State in either jurisdiction is informed. If he is not, how will he know whether a personal injury claim is successful and compensation will be paid out? It therefore follows that the insurance company must apply for the certificate from the Secretary of State—substitute compensation recovery unit for Secretary of State. Incidentally, the Minister need not be too shy about this because the word "must" is already used in this clause in subsection (7) line 42. It states that,
"a person who has made a compensation payment in consequence of an injury suffered by an injured person must apply for a certificate to the Secretary of State",
if the original one is lost or is no longer in force or for various other reasons. Under those circumstances, a replacement certificate must be applied for but originally it was not. I simply do not understand why. I beg to move.
Lord Warner: Referring to our earlier discussion, I wish to put on the record that I am reliably informed that at 11.30 this morning we placed in the pigeon-holes of all the Front Bench spokesmen a copy of the letter that was discussed. Clearly, something went wrong.
Amendment No. 419 would place a legal requirement on potential compensators to apply for a certificate of NHS charges before any compensation payment has actually been made. Although it may seem logical to encourage compensators to apply for certificates as early as possible in the claim process, it is important to remember that the recovery of NHS charges is secondary to, and dependent on, a
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successful claim being made. In other words, it is only once a compensation payment has been made that NHS charges can be recovered. It is by no means the case that every personal injury claim made is successful. Some are so manifestly unfounded that it is clear from the outset that they will fail. It seems inappropriately bureaucratic—indeed, a little draconian—to require the person against whom the claim is made to apply for a certificate of NHS charges before it is clear that they will be liable to pay such charges.
That is why subsection (1) of Clause 147 is worded as it is. It allows for compensators to apply for a certificate before the claim is settled if they choose to do so, but does not require them to do so. Of course, it is quite a different matter once a compensation payment has been made. Then the recovery scheme definitely comes into play, and compensators have an obligation to pay any NHS charges identified. It is for that reason that subsections (7) and (8) of Clause 147 place a legal obligation on compensators to apply for a certificate if they have not already done so at the time the claim is settled, or if a previously issued certificate has expired. It places the onus on the compensator to apply for a certificate to the Compensation Recovery Unit (CRU), the body that administers the existing road traffic scheme and that we expect to do the same for the extended scheme.
To remove that obligation, as Amendment No. 420 would do, would create a loophole that would undermine the entire costs recovery scheme. Compensators would quickly realise that it would be impossible for CRU to find out about many claims if they are not told about them—the applications for a certificate are often the first indication that the CRU has that a claim attracting NHS charges has been made. Given that one of the key principles of the scheme is to make the compensator pay the full costs of their negligence, I cannot see how it is unreasonable to require the compensator to inform CRU of the claim. It is common practice in relation to a huge variety of public and indeed private responsibilities. For example, car owners are required to inform the DVLA when they buy or sell their vehicle; it is not for the DVLA to find out about it. The principle is no different for the NHS costs recovery scheme.
Taken together these amendments would move the element of coercion for compensators from the point at which their liability to pay NHS charges is definite to a point at which it may still come to nothing, That does not seem a fair or equitable way to proceed.
1.45 a.m.
Lord Skelmersdale: The noble Lord seems to have made my case for me when he talks about the onus on the compensator. The compensator therefore must apply for a certificate. It seems that the case is totally proven.
Over and above that, the "must" in subsection (8) appears to be an almost straight copy of Section 2(8) of the Road Traffic (NHS Charges) Act. This

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procedure has been used in respect of that Act. I make the point again that that covered compulsory insurance; this Bill extends to non-compulsory insurance. What happens in cases of uninsured compensation which could be very much greater under this Bill than under anything we have seen heretofore, certainly than under the RTA procedures where insurance is compulsory by law? That provokes me to ask a question that I should have asked perhaps right at the beginning—whether the new scheme will apply to uninsured individuals or not?
Lord Warner: The scheme makes clear that there has to be a compensation payment by a compensator before there can be any recovery of NHS charges. If a person has no capacity to seek an insurance payment then it would be jolly difficult for the compensator to be made responsible for those NHS charges.
Lord Skelmersdale: One could argue that the individual in question is a self-compensator, for want of a better expression. However, I do not think that I want to pursue that any more. The noble Lord has given me a comprehensive but not totally readily explicable explanation. I shall have to read very carefully what he said before deciding how to proceed. Meanwhile, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 420 not moved.]
Clause 147 agreed to.
Clause 148 [Section 147: supplementary]:
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 421:
Page 67, line 26, leave out subsection (2).
The noble Lord said: I tabled this amendment again rather than have a clause stand part debate. I would assume that subsection (2) covers cases where a certificate is applied for in England when it should have been applied for in Scotland and vice versa. It seems to me that that is bureaucracy gone mad, resulting in a totally unnecessary paper chase. Who issues the certificate is neither here nor there; what matters is where the money goes. What about a case where an English or Welsh visitor goes to a Scottish National Trust property in the Borders and has an accident, claims against the insurance policy, is accepted and is treated in, say, a Durham hospital? The insurance company applies to the Scottish Minister for a certificate. The money goes to the Scottish Ministers. They will have to establish from the Durham hospital and perhaps the Scottish ambulance how much the cost was, particularly whether it was below the ceiling, and then remit it to the hospital and ambulance authority concerned. What a paper chase.
Why cannot a certificate be issued by either the Secretary of State—that is, the Compensation Recovery Unit in England—or the Scottish authorities? Those would receive the money and dole
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it out to the appropriate health function in either jurisdiction as is specified in Clause 158. An awful fuss seems to be made in the Bill as to who issues the certificate rather than what really matters, which is who gets the money and where does it end up. I beg to move.
Lord Warner: Subsections (1) and (2) of Clause 147 work in tandem to deal with a very specific situation; that is, where an application for a certificate has been made under one of the recovery schemes, but it appears that any payment may be due under another scheme. For example, where an application is made to the England and Wales scheme, but treatment was received in a Scottish hospital or vice versa. Subsection (2) allows, indeed requires, the application to be referred to the appropriate scheme and to be treated as though it had been made originally to that scheme. This reflects the arrangements in the current road traffic scheme, which operate without any difficulty.
Although the provisions in the Bill set up two separate schemes—one for England and Wales and another for Scotland—in order to meet the requirements of devolution, in practice, the Government intend that the two schemes be administered by the Compensation Recovery Unit (CRU), which currently operates the road traffic schemes on behalf of the Secretary of State and the Scottish Ministers.
Omitting subsection (2) would create a bureaucratic stupidity that would cause unnecessary inconvenience for compensators and administrative difficulties for the Compensation Recovery Unit. Instead of, as now, officers working on Scottish cases being able to transfer information about an application to colleagues dealing with English and Welsh cases as considered appropriate, they will have to inform the compensator that they appear to have applied to the wrong scheme and to ask them to apply directly to the right one.
Not only will there be a delay in issuing the certificate, but both the compensator and the CRU will be involved in unnecessary paperwork, all because the staff at the CRU are unable to talk to each other about claims under the different schemes. It is to avoid that kind of bureaucratic nonsense that subsection (2) does not allow information to be passed from one scheme to the other, but actually makes it a requirement to do so.
Lord Skelmersdale: I do not know who advised the Minister to produce that answer, but clearly whoever it was has not read behind the amendment but has taken my leaving out subsection (2) as gospel and my ultimate intention, which, as I explained in my opening remarks, it was not. However, I do not think that we shall get any further tonight. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 148 agreed to.

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Clause 149 [Information contained in certificates]:
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 422:
Page 68, line 17, at end insert—
"( ) A certificate must specify the rights of the person to whom it is issued to have the certificate reviewed under section 152 or to appeal under sections 153 to 155."
The noble Lord said: Amendment No. 422, which states,
"Page 68, line 17, at end insert—"
might be better encompassed, I must confess, in subsection (5). Be that as it may, I trust that I can have a commitment that a standard part of the certificate will tell the recipient of his rights, especially of appeal, and obligations in respect of NHS charges. That is important at the beginning of the scheme anyway for insurance companies that have never offered motor insurance and, permanently, where individuals—as I think we have just established—in rare cases are sent the certificates. I beg to move.
Lord Warner: It is already the case that this information is included on every certificate issued in respect of the existing road traffic scheme. I can also offer the noble Lord the same assurances that it is fully intended that the new certificate for the extended scheme will also include information on review and appeal procedures. Indeed, the early design work on the certificate already does so.
Lord Skelmersdale: For the first time in my discussions on this part of the Bill, I accept the words that the Minister uttered with glee, happiness and appropriate respect, for which I thank him. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 423 had been withdrawn from the Marshalled List.]
Lord Hunt of Wirral Lord Hunt of Wirral moved Amendment No. 423A:
Page 68, line 31, leave out from "which" to end of line 32 and insert "the parties to an action either commenced or contemplated before a court in England and Wales or Northern Ireland have reached an agreement in writing"
The noble Lord said: Amendment No. 423A is intended, along with a similar amendment to Clause 152, to enable the procedures set up to be followed without the necessity of a court order. The point I seek to make most strongly in reference to the amendment is that the vast majority of claims settle without the need for court proceedings, and the current proposal to limit adjustment to those cases where the court has made an order risks either the growth of litigation for a satellite purpose or fails to achieve the desired objective of adjustment.
As the Minister pointed out to me in his letter, to which I shall refer shortly, the present wording in the Bill does not require a formal decision of the court, but it does require a consent order. When I made the Minister aware of my concerns by sending him a copy of my speaking notes—no doubt we shall discuss this
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in more detail, but I felt that I had to put on the record the arguments on either side; it may be that there is insufficient time to go over this matter again on Report—he responded by stating that:
"I understand the argument that by requiring formal endorsement of the agreement through a court process we may encourage compensators to take a case to court that they might otherwise settle informally. But in actual fact, a compensator would not need to go through a full court hearing to get an agreed order which would meet the requirements of clause 149(3)(d), and could be used for the purposes of calculating NHS costs".
The main point I wish to make to the Minister is that we have moved on in civil litigation as a result of the reforms introduced by successive Lord Chancellors. There has been a wish to see matters of this nature settled without the need for court proceedings. Indeed, we now have wide-ranging pre-action protocols which are designed to ensure that matters can be resolved without the expense of court proceedings at any stage.
There is also an element of encouragement on the part of the Government towards what is known as ADR, alternative dispute resolution. I hope, therefore, that the Minister would accept that by requiring there to be court proceedings, the department in which he is a Minister is moving in precisely the opposite direction from that of the Department for Constitutional Affairs and the reforms of successive Lord Chancellors. Surely there must be a way to reach an agreement—and I am not talking about something on the back of an envelope—of the kind that is reached in the overwhelming majority of cases so that the expense of involving the court is not required at any stage.
My final question to the Minister is that, in the alternative dispute resolution procedure, a mediator is often involved. That mediator sets out the agreement which has been reached between the parties and the whole purpose of the alternative dispute procedure is to avoid court proceedings. Is the Minister really suggesting that all that should be swept aside and, in order for this provision to operate, there has to be a consent order? You cannot have a consent order without proceedings having been commenced, and therefore after the alternative dispute resolution procedure had been followed, we would then have to go through the very procedure that ADR is designed to avoid; namely, court proceedings. I beg to move.
2 a.m.2
Lord Warner: This is a complex issue and the Government thought long and hard about the best way to deal with it. The Department of Health certainly does not intend unnecessarily to push cases through the civil courts. We decided eventually that only where the decision on the extent of contributory negligence had been formally considered through one of the processes identified in the Bill should it be possible to reduce the amount of NHS costs payable.
The important point is to ensure that all the relevant issues have been properly considered in an appropriate forum, or where contributory negligence

1443
is specified in an agreed judgment or order, so that the rights and responsibilities of both sides are protected. Often the kind of agreement suggested by the noble Lord can be, with great respect, little more than a back-of-the-envelope agreement which we could not be sure had fully taken into account all the issues.
I understand the argument that by requiring formal endorsement of the agreement through a court process we may encourage compensators to take a case to court that they might otherwise settle more informally and more quickly. However, it is not an argument which the Government fully accept.
For a start, the compensator does not need to go through a full court hearing to get an agreed order which would meet the requirements of Clause 149(3)(d) and could be used for the purposes of calculating NHS costs. That is certainly the legal advice I have received. Furthermore, in many cases it will not be worthwhile for a compensator to push a case to court solely in order to get a contributory negligence ruling for the purposes of NHS costs recovery. Even if the costs due have reached the cap, the costs attached to running the case may well exceed what might be saved in NHS costs recovery. So there are some constraints there.
I include this issue in the areas that I am very happy to discuss in detail with the noble Lord. In view of earlier comments, however, I thought that I should put the Government's current position on the record. I shall be happy to discuss the matter in more detail with the noble Lord when we meet.
Lord Skelmersdale: Before my noble friend decides what to do with the amendment, I recall that the issue of contributory negligence was the cause of a long battle on the 1989 Bill. The then government were planning on, and succeeded in, dropping it from the 1948 compromise in the previous Parliament, and no mention that I can find was made in the Bill which became the 1999 Act. Why have we suddenly got it now?
Lord Warner: I was otherwise engaged when that earlier legislation was going through and so I will have to look back at the arguments. I have set out the Government's position. If I can do anything more to clarify matters for the noble Lord, I shall write to him.
Lord Hunt of Wirral: In reply to my noble friend, I have always felt that it was an anomaly in the recoupment of NHS charges and benefits to require insurers to pay the full sum irrespective of any deduction for contributory negligence. That is where the Minister and I are in agreement. I greatly regret that I have to disagree with my noble friend.
The Minister used the phrase "back of the envelope" even though I had cautioned him against doing so. But the overwhelming majority of claims are now settled by agreement without the need for court proceedings. The whole purpose of the civil justice reforms and the pre-action protocols was to
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introduce a system whereby the expense of the nation was spared; where you did not have to commence proceedings but could reach agreement.
The present Lord Chief Justice, previously the Master of the Rolls, the noble and learned Lord, Lord Woolf, did the nation a great service when he removed from the courts the burden of having to commence court proceedings by setting down the procedures in pre-action protocols. This is not a back-of-the-envelope solution; it ensures that the nation does not have to bear the costs of court proceedings in a whole range of cases.
ADR—alternative dispute resolution—is certainly no back-of-the-envelope system. The mediator reaches a solution which often involves give and take—otherwise you would not need a mediator. In cases where people blame each other or there is a whole sequence of events which point the finger at the injured person as having been at least partially to blame for what occurred, the mediator comes in and reaches some kind of agreement.
The whole purpose of ADR is to be alternative— it is alternative dispute resolution. Alternative to what? To the court. But the Minister is trying to tell us that that is all "back of the envelope" stuff. Even though it is a tried and tested procedure, encouraged by the Department for Constitutional Affairs, it is to be regarded as inferior, although the whole panoply of civil justice reforms has been to demonstrate to those who are claiming compensation that it is not necessary to go through the court proceedings. You can reach an agreement which is cost-effective and good value for money for everyone concerned without having to commence court proceedings.
Again, the Minister has enticed me and tempted me into having further discussions. How could I refuse such an offer? I hope I have been able to persuade him, however, that there is surely a solution whereby non-back of the envelope settlements could be included in some way. That is not to try to introduce some inferior procedure but to recognise that the whole drift of civil justice reforms has been in the direction of enabling parties to reach settlement without taking up the time of the court. But in view of what the Minister has said, I welcome the opportunity of some further discussions and, in the meantime, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hunt of Wirral Lord Hunt of Wirral moved Amendment No. 423B:
Page 70. line 5, at end insert—
"( ) Regulations may provide that where—

(a) a person has made one or more payments to the Secretary of State under section 146, and

(b) in consequence of a review or appeal, it appears that the amount paid is more than the amount that ought to have been paid,

the difference must be repaid by such person or persons as may be described."
The noble Lord said: This amendment seeks to insert a provision that appeared in the 1999 Act but is less clear in this Bill. Where a certificate is reviewed

1445
or appealed, it is entirely possible that the amount shown on the certificate as due will be reduced. An appeal is almost certain to take place after a compensator has paid the treatment charges owing, and it is possible that a review may also take place after payment. The 1999 Act contained power to make regulations requiring the refund of any overpayment. That provision is absent from the Bill.
The Minister has kindly written to me saying that he recognises that Amendment No. 423B would make explicit on the face of the Bill that if it is established that a compensator has paid more than they were liable for, there is an obligation on whoever has received that payment to refund the excess. He concedes that that is only right and proper. Clause 149(5)(f) ensures that processes can be set up to protect compensators in this respect.
As with the existing road traffic scheme, it is intended that arrangements for dealing with overpayments by compensators will be set out in regulations.
The Minister pointed out that Clause 158(2) prohibits both the Secretary of State and the Scottish Ministers from issuing to NHS bodies any moneys which have been identified as being repayable to the compensator. The regulations, he assures me, will deal with both those cases and cases in which the money has already been forwarded to the relevant NHS trust before the overpayment is identified. That is why the Minister sees no need to make the obligation any more explicit on the face of the Bill.
That is very helpful and I am grateful to the Minister for confirming that the regulations will deal with this point. When does he intend that the draft regulations will be available so that we can scrutinise them? In particular, as they will deal with a requirement—the non-appearance of which has troubled me—it would be helpful if I could see at least the draft of how it is proposed to deal with that in the regulations. But I am very grateful to the Minister for having given me the response he has already given. In that context, I beg to move.
Lord Warner: The noble Lord has done a good job at accurately setting out my case for why we do not believe it necessary to add Amendment No. 423B to the Bill. I shall not go over the ground again, other than to accept that he has put our position accurately and assure him that we will produce the draft regulations as soon as we can after Royal Assent. We shall not be introducing the scheme until after the outcome of the review has been made known.
The noble Lord did not speak to Amendment No. 430A, which allows NHS costs to be recovered only on final payment of compensation. That would prevent any interim payments of compensation, triggering the payment of NHS costs. The existing road traffic recovery scheme allows recovery of NHS costs
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following interim payments. The arrangement works well. We propose to make the same arrangements in relation to the extended scheme.
Lord Hunt of Wirral: I am very grateful to the Minister. I did not deal with Amendment No. 430A because he has already indicated that overpayments will be repaid in individual cases. I am happy with that, but it would be of great assistance if those parts of the regulations that are in draft at present could be shared with those of us who are concerned about the matter so that we can check that the point is properly covered. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Hunt of Wirral Lord Hunt of Wirral moved Amendment No. 423C:
Page 70, line 16, at end insert—
"( ) Before making any regulations under subsection (2), the Secretary of State shall consult with such persons as he thinks appropriate."
The noble Lord said: The amendment would insert a duty for the Secretary of State to consult before making regulations. Regulations under subsection (2) cover a number of different aspects. By virtue of subsection (5), the regulations may, in particular, provide for a cap on the amount or aggregate amount to be repaid for set amounts for different circumstances. The regulations under the 1999 Act provided for both a cap and a daily rate for out-patient and in-patient treatment. Those provisions worked well, and I would welcome an assurance that such provision is likely to continue.
The then Secretary of State gave a commitment to Parliament that, before the overall cap was raised, he would consult with such persons as he thought appropriate, including in particular the insurance industry, which has to meet the bulk of the claims.
The Minister wrote to me about the amendment, using a wonderful phrase. He said:
"It goes without saying that the regulations setting out the operational framework for the extended scheme will not, indeed could not, be developed without proper consultation".
I am afraid that "without saying" is an inappropriate phrase. I refer the Government to the very fast action of the Minister's predecessor, the noble Lord, Lord Hunt of Kings Heath. It is good to see him in his place, where he has been sitting virtually throughout the proceedings of the Bill.
When the Government introduced the Road Traffic (NHS Charges) (Amendment) Regulations, I pointed out to the noble Lord, Lord Hunt of Kings Heath, that there had been no consultation at all. As soon as the noble Lord heard that, he immediately revoked the regulations. I warmly applauded the way in which he did that. As soon as he became aware that there had been a commitment to consult, and, indeed, that the consultation had through some oversight not occurred—which I do not think was anything to do with the then Minister—he revoked the regulations because of the failure to consult. I refer the Minister to parliamentary Answer PQ5042/2001–02 given on 6th February 2002 when those regulations were revoked because of the failure to consult.
When the Minister now says that it goes without saying that these regulations could never be introduced without consultation, will he forgive me if I have a little doubt that somewhere in the great processes of his department there might be a mistake made and a failure to consult repeated? I hope that in these circumstances he will understand why I am pressing my Amendment No. 423C regarding a duty to consult.
I suppose in a way we are just learning from past experience. I do not ascribe any blame to anyone for what happened. Indeed, I pay tribute to the integrity of the Minister's predecessor in moving so swiftly to put things right. If there is not a duty to consult, consultation is somehow bypassed or omitted. I hope the Minister will recognise that the amendment I put forward could not be worded better from his point of view. It states:
"Before making any regulations … the Secretary of State shall consult with such persons as he thinks appropriate".
What could be nicer than for a person on the Opposition Benches to give the Minister the final choice in the matter? It is probably because I have confidence that he, in the tradition of his department, would consult with the most appropriate people. In order to tempt him to accept the amendment—which I hope that he might do even at 2.17 in the morning— I have worded it so widely that I do not think even a reluctant Minister could fail to appreciate that I am giving him an olive branch which I hope he will now accept. I beg to move.
2.15 a.m.
Lord Skelmersdale: Of all the words I might use to describe the Minister, "erroneous" most certainly is not one of them. My noble friend Lord Hunt of Wirral has my full support on the matter. If the Minister insists on negative regulations—we shall see if he gets away with that—consultation before, for example, resetting the cap or the daily inpatient or outpatient rates, is absolutely essential. As my noble friend pointed out, this is a lacuna in the current legislation that we are considering which did not appear in the 1999 Act.
Lord Warner: Even though our intention is to make the scheme work in the same way as the existing road traffic scheme, we still need to ensure that those who will be affected by the scheme, and those who will operate it, have a proper say in how it is set up. I am grateful for the generous remarks of the noble Lord, Lord Hunt of Wirral, about the Secretary of State and my department. I am not sure that Members of his Front Bench were always quite as trusting of the Secretary of State as he was.
Furthermore, as was already debated in our consideration of Amendment No. 474A, your Lordships' House together with the other place will have an opportunity to discuss the first set of regulations made under Clause 149(2). I am afraid that I am not convinced that that needs to be specified in the Bill. I also point out
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to the noble Lord that, as drafted, the amendment would create an anomaly in that the Secretary of State would be required to consult, but Scottish Ministers would not. For those reasons, the Government are not inclined to support the amendment.
Lord Hunt of Wirral: Against the background that I am now very willing to bring forward a further amendment on Report to place a similar obligation on Scottish Ministers, I beseech the Minister to rethink the matter. If I am disposed to meet his final point— to make sure that there is no anomaly and that the duty applies to both the Secretary of State and the Scottish Minister—I hope that he might agree that the Bill ought to contain a duty to consult, particularly bearing in mind the previous occasion.
The matter is of great importance, and it would be too late for consultation to take place once the regulations were laid. It is all well and good to say that there will be an affirmative resolution procedure, but the regulations are either accepted or not. They cannot be amended. The whole purpose of consultation is to check carefully through the detail of the regulations before they are laid. The Minister does not appear to be rising to his feet to say that he is now persuaded—
Lord Warner: I tried to make it clear that the first set of regulations would be subject to the affirmative resolution procedures, so there would be an opportunity for people to debate the matter in both Houses of Parliament. However, in view of the concerns, the lateness of the hour and the charm with which the noble Lord makes his point, I shall be happy to take the matter away, discuss it with him and report our further consideration on Report.
Lord Hunt of Wirral: The Minister places me in a very difficult position. I had just girded myself up to test the opinion of the Committee, even at this late hour. I find that very difficult, so I really must accept his olive branch. In those circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 149 agreed to.
Clause 150 [Payment of NHS charges]:
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 424:
Page 70, line 24, leave out "14" and insert "30"
The noble Lord said: Yet again, the Bill relies on procedures under the 1999 Act where settlement of the payment must be made within 14 days. In answer to a similar amendment in another place, it was stated that 90 per cent of motor charge certificates are applied for in advance of settlement, and that 14 days has posed no problem. Bully for that. The amendment does not cover them, but refers only to certificates issued after the settlement date. Those would apply principally to certificates sent to individuals who may—let us hope— see only one in their whole lifetime.
Some insurance companies have long been used to dealing with the bureaucracy of the NHS, but new insurance companies will now be brought into the fold

1449
that will not be. It is only right that a little more time is allowed, and that 14 days should be extended to 30. I beg to move.
Lord Warner: Where the certificate of charges has been issued in advance of the personal injury claim being settled and the compensation claim paid, compensators may have had weeks or even months of notice of how much they will need to pay in NHS charges. Giving them 14 days to do so does not seem unreasonable. Similarly, if someone applies for a certificate after making the compensation payment, they will know that they are likely to have to pay charges and can make the necessary preparations to do so. There is no evidence from the existing road traffic scheme that those time scales are unreasonable or unmanageable. We are not persuaded to extend this date for the reasons that I have given.
Lord Skelmersdale: Oh dear. I have already said that the amendment has nothing to do with certificates that are applied for in advance of settlement. In those circumstances I accepted originally that 14 days posed no problem. However, as I pointed out, the amendment is intended to cover those cases where the certificate is applied for after the settlement payment is made. The Minister is being unreasonable. The Committee will remember that in a Parliamentary Question on Tuesday last week we were reminded that companies are allowed to claim interest on payment of debt after 30, not 14, days. In those circumstances, unless the Minister comes back to me, I think that I ought to ask him to think again.
Lord Warner: I have nothing to add to my previous remarks.
Lord Skelmersdale: In that case I must test the opinion of the Committee as to whether 14 or 30 days is most appropriate.
2.26 a.m.
On Question, Whether the said amendment (No. 424) shall be agreed to?
Their Lordships divided: Contents, 11; Not-Contents, 41.

Division No.4

CONTENTS

Attlee, E. [Teller]

Howe, E.

Barker, B.

Hunt of Wirral, L.

Noakes, B.

Blatch, B.

Roper, L.

Clement-Jones, L.

Skelmersdale, L. [Teller]

Colwyn, L.

Strathclyde, L.

NOT-CONTENTS

Acton, L.

Gordon of Strathblane, L.

Amos, B. (Lord President)

Grocott, L. [Teller]

Andrews, B.

Hollis of Heigham, B.

Archer of Sandwell, L.

Hoyle, L.

Bach, L.

Hughes of Woodside, L.

Bassam of Brighton, L.

Hunt of Kings Heath, L.

Brett, L.

Jones, L.

Brooke of Alverthorpe, L.

Jordan, L.

Burlison, L.

Mclntosh of Haringey, L.

Campbell-Savours, L.

McIntosh of Hudnall, B.

MacKenzie of Culkein, L.

Carter, L.

Mitchell, L.

Chandos, V.

Pendry, L.

Crawley, B.

Plant of Highfield, L.

Davies of Coity, L.

Randall of St.Budeaux, L.

Davies of Oldham, L.[Teller]

Sawyer L

Dean of Thornton-le-Fylde, B.

Simon, V.

Desai. L.

Warner, L.

Evans of Temple Guiting, L.

Warwick of Undercliffe, B.

Farrington of Ribbleton, B.

Whitty, L.

Golding, B.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.
2.36 a.m.
[Amendments Nos. 425 to 430 had been withdrawn from the Marshalled List.]
[Amendment No. 430A not moved.]
Clause 150 agreed to.
Clause 151 agreed to.
Clause 152 [Review of certificates]:
[Amendment No. 430B not moved.]
Lord Hunt of Wirral Lord Hunt of Wirral moved Amendment No. 430C:
Page 73, line 11, at end insert—
"( ) But the Secretary of State may not vary a certificate so as to increase the total amount specified unless it appears to him that that variation is required as a result of his having been supplied with incorrect or insufficient information by the applicant for the certificate."
The noble Lord said: This amendment brings into the Bill a provision contained in the 1999 Act. However, I cannot see it being preserved in the current Bill and the Minister has now confirmed that to me.
The Secretary of State has the power to review certificates in certain specified circumstances. Naturally, an aggrieved party who asks the Secretary of State for a review is likely to ask for a review downwards. The 1999 Act provided that the Secretary of State could vary a valid certificate upwards only in very limited circumstances— essentially where the Secretary of State had been misled by the parties on the requisite details.
I believe that that was an entirely appropriate provision in the 1999 Act. Essentially it meant that responsibility for errors in certificates rested with the Secretary of State unless the error was caused by one of the parties. I really could not see why that provision had been omitted. That is why Amendment No. 430C would insert in Clause 152 on page 73, line 11, a new subsection (4)(d) in the following terms:
"But the Secretary of State may not vary a certificate so as to increase the total amount specified unless it appears to him that that variation is required as a result of his having been supplied with incorrect or insufficient information by the applicant for the certificate".
As I indicated, the Minister has already responded to me by confirming that the wording that I want to insert into the Bill is the provision currently contained in Section 6(3) of the Road Traffic (NHS Charges) Act 1999. As I have just outlined, the effect would be that underpayments by compensators could be put right only where they were the result of incorrect or inadequate information having been supplied to the administrators of the scheme. Underpayments resulting from clerical or administrative errors could not be put right unless the compensator chose to do so.
That is the Minister's response. In his letter to me he points out that the amounts lost under the current scheme due to errors are very small. But while it may not be much in the overall scheme of things, the
1452
Minister has pointed out that it can sometimes be far more significant for an individual trust that could potentially lose a five-figure sum. He concludes:
"It is for that reason that the Government decided not to perpetuate the situation that pertains in the road traffic scheme in this respect".
I respond by saying that if there are errors and omissions that are not due to the parties that have provided the requisite details, but are due to some error within the Minister's own responsibility, I believe that the Minister should be constrained in the way that I have suggested in the amendment.
If one cannot rely on a certificate from the Department for Work and Pensions, that undermines the whole system. Without my amendment, the Bill would state that the Secretary of State could just issue a certificate at any time. That will create uncertainty. Surely, the Minister could rethink this point and recognise that if there are clerical or administrative errors wholly due to his own department—the Department for Work and Pensions—they should not be laid at the door of the parties and prevent them in the way that I have described. I hope that he will reconsider this matter and accept the amendment. I beg to move.
Lord Warner: I do not believe that we could accept the amendment as drafted even if we wanted to because it does not mention Scottish Ministers. It would mean that underpayments in England and Wales due to clerical error could not be recovered, but that similar payments in the Scottish scheme could. Having said that, I understand the arguments that the noble Lord makes. I am happy to agree to re-examine the issue. I make no commitment but the noble Lord and I shall cover this in discussions with colleagues and we shall see whether we can move forward on that issue.
Lord Skelmersdale: We have had six days of debate on this. How long does the Minister anticipate that the discussions will last?
Lord Warner: I have said that 1 would meet the noble Lord to discuss with him a variety of his amendments, particularly those on which he has some detailed concerns. I am simply sweeping up this matter into those discussions. At the same time I am saying to the House that we shall re-examine the issue and return to the matter on Report.
Baroness Blatch: The Minister is being very generous in his offer of meetings. I know that my noble friend Lord Hunt will welcome and appreciate that. I need to remind the noble Lord that only two days have been allocated for Report stage. With the number of matters that are now subject to meetings,

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and which will give rise to more debates on Report, I hope that there will be a more generous allocation of time for discussion on Report.
Lord Warner: That is a matter for the usual channels. I would not rule out the fact that what we have to say may be so persuasive that there may be no problems when we come to Report.
Lord Hunt of Wirral: I do not know quite what to say. I have had so many generous offers. The only offer that the Minister has not yet made to me is office space within his department. He is now offering it. I am reminded of the words of Viola in Twelfth Night when she said,
"Make me a willow cabin at your gate".
I shall not pursue this matter at a quarter to three in the morning. Once again I say that I am grateful to the Minister. In the circumstances, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 152 agreed to.
2.45 a.m.
Clauses 153 to 157 agreed to.
Clause 158 [Payment of NHS charges to hospitals or ambulance trusts]:
[Amendment No. 430D not moved.]
Clause 158 agreed to.
Clause 159 agreed to.
Clause 160 [Liability of insurers]:
On Question, Whether Clause 160 shall stand part of the Bill?
Lord Hunt of Wirral: Clause 60, which deals with the liability of insurers, is a new provision and, as far as 1 can tell, it did not feature in the 1999 legislation. I am not certain what prompted the Government to seek to include this provision for the first time for four years. It may be—I speculated to the Minister— that the Government were concerned about limits of indemnity on certain types of insurance policy, which of course would not be a feature in road accident cases.
If that were the Government's concern, I mentioned to the Minister that I would welcome confirmation that regulations to be made under this clause would not cause insurers to have to pay out in excess of the limits under their policies. I appreciate that this might mean a deduction from the damages that a claimant might otherwise receive, but 1 sense that insurers were understandably anxious that they should not be exposed to greater liability than policy limits provide.
1454
In response, the Minister stated in a letter to me:
"Where a liability to pay compensation is coveted by insurance, it is our [the Government's] view that the corresponding liability to pay NHS charges should also be covered by the insurance policy. Clause 160 supplements clause 146(2) which makes it clear that liability to pay NHS costs falls upon 'the person making the compensation payment". There is no provision to transfer that liability to a third party".
The noble Lord explained that,
"Clause 160 ensures that this liability to pay NHS costs is made absolutely explicit".
The Minister went on to explain that the,
"requirement was not necessary under the road traffic scheme which was concerned only with cases covered by compulsory motor insurance or its equivalent".
He felt that Clause 160,
"reflects the fact that all kinds of personal injury will now be included in the scheme regardless of the insurance position, and that they may be covered by different types of insurance".
The Minister, however, stressed that,
"the clause also enables regulations to be made to limit an insurer's liability in some circumstances. This might include ... enabling a reduction in the NHS costs payable in cases where an insurer has only covered a proportion of the total compensation clue as a result of a cap on the amount payable under the insurance policy".
I am very grateful to the Minister for his explanation, which goes some way to satisfying me. I am very grateful to him for giving me the opportunity of his reply in advance of this debate. I hope that I have set out his position as clearly as I can in my speech on Clause 160 stand part. Of course I should like to see more detail, and I recognise that he has already explained that his offer for further discussions includes this aspect. I readily accept that and am very pleased that he should have made that offer.
Lord Skelmersdale: If my noble friend Lord Hunt's explanation of the Minister's view is correct, does that mean that individuals are encouraged to insure up to the £33,000 cap? If so, the cost to individuals will rise exponentially.
Lord Warner: The outline of the Government's position given by the noble Lord, Lord Hunt, was completely accurate and I have nothing to add to it. I cannot prejudge the question posed by the noble Lord, Lord Skelmersdale. I should like to think a little more about it and will come back to him.
Clause 160 agreed to.
Clauses 161 to 165 agreed to.
Clause 166 [Provision of primary dental services]:
Lord Colwyn Lord Colwyn moved Amendment No. 430E:
Page 81, line 21, at end insert—
"( ) Each Primary Care Trust and Local Health Board will publish a statement of what constitutes a reasonable level of service in its area."
The noble Lord said: We now come to Part 4, which covers provision of primary dental services. At this time of night, the Committee will be delighted to hear that 1 do not intend to see any patients tomorrow morning.
My amendment is intended to discover what the Government intend shall be a reasonable level of service when provided locally by primary care trusts. Most of the profession—the British Dental Association and the General Dental Practitioners Association—welcome the proposals in Agenda for Change that move towards local commissioning of dental services by primary care trusts. For many years—certainly since Sir Kenneth Bloomfield's report in the early 1990s—dentists have wanted to get off the treadmill of fee per item of service.
I have received a letter from the Minister, for which I thank him. He says that he agrees with the intention behind Amendments Nos. 430E and 434A. He also points out the Secretary of State's general duty under Section 3 of the National Health Service Act 1977, which states that he must provide dental services,
"throughout England and Wales to such extent as he considers necessary to meet all reasonable requirements".
But what is reasonable? Reasonable may mean different things in different parts of the country. During Committee in the other place, it was noted during discussion of an equivalent amendment that the reference to local need was proposed because dental health varies considerably around the country and there was a perception that that was not recognised in the wording. It was intended as a reference to local needs, as opposed to local residents' needs, as commuter populations were also regarded as local.
The principle of local commissioning must be supported, but it is important that assurances be given about what constitutes reasonable levels of service. The PCTs must make clear what services will be available. Perhaps "reasonable" means the essential services that the public currently receive from the NHS dentistry. Will the Minister confirm that stakeholders, local dentists and the public will be consulted on that definition; and that, having defined "reasonable", the PCTs will ensure that they are accessible? I beg to move.
Baroness Barker: I shall speak to Amendments Nos. 431 to 436. Never in my life has dentistry seemed a more pleasing prospect. I simply want to add a few more strings to the bow of the argument advanced by the noble Lord, Lord Colwyn. We are trying to tease out what is determined to be an acceptable level of dentistry provision.
Amendment No. 431 is a probing amendment to enable us to ask the Minister exactly what will be the requirement placed on primary care trusts to determine and provide NHS dentistry. Amendments Nos. 433 and 434 set out our strongly held view that dental services ought to be based on need and, thereafter, on funding. Amendment No. 435 is important in that it draws into the definition of primary dental care such work as orthodontics and oral surgery, which are provided increasingly at local level.
1456
Perhaps one of the most important provisions is the requirement to publish details of dental provision and complaints procedures. Members of the Committee will recall that, a few months ago, details of a new NHS dentist were kept hidden for fear that his surgery would be besieged, such is the scarcity of NHS dentistry in an increasing number of areas. NHS dentistry is becoming the profession that dare not speak its name, such is the demand in some areas. I am being flippant, as it is five to three in the morning, but it is a very serious issue, as many Members of the Committee, most specifically the noble Lord, Lord Colwyn, have highlighted.
Earl Howe: Amendment No. 430A, which stands in my name, differs only slightly from the amendment moved by my noble friend Lord Colwyn. I cannot add much to what he said, except to ask, on the assumption that the Minister agrees that a definition of "reasonable" is to be sought, who would be consulted and what benchmarks are there for making a judgment on it? It is a will-o'-the-wisp concept, but somehow we must get closer to it.
The dentistry objectives proclaimed by the Government are worthy in themselves, but they cannot be fulfilled without having sufficient dentists to perform the work. That is why I have tabled Amendment No. 432. Positive action is needed to ensure that enough dentists, dental nurses, dental hygienists and dental therapists are trained and in post to cater for the increasing levels of patient demand. That requires workforce planning.
I do not know whether the Minister is in a position to update the Committee on the department's workforce planning review, but she will know that that is seen as a key step towards addressing the concerns expressed by the modernisation board about capacity in the dental profession. As noble Lords have pointed out in recent debates on the subject, the British Dental Association has estimated that as many as 25 per cent more dental students are needed if we are to close the gap between supply and demand.
3 a.m.
Baroness Andrews: I feel that we have reached the sunlit uplands, occupied entirely by dentists. It is a great pleasure to hear from the noble Lord, Lord Colwyn, who has been such a faithful companion on this long journey over the past 12 hours.
The Government are committed to rebuilding and restoring NHS dentistry to improve the oral health of the nation. As the noble Lord pointed out, it has been a long time coming over the past decade, since the Bloomfield report, when so many in the profession have sought change and welcome the changes that we have introduced now. I know that the dentists in the House of Lords have lent their voice in support of that. The proposals represent the most radical reform of NHS dentistry since 1948. That is why we welcome the emphasis in the

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amendment tabled by the noble Lord, Lord Colwyn, and others on the promotion of primary dental services and better oral health.
I do not want to rehearse the history. Let it suffice to say that the Government, the NHS and the BDA have worked hard to develop the proposals published in Options for Change in August 2002. The key recommendations were for an integrated, high quality primary dental service that was locally commissioned and responsive to the needs and wishes of patients. That is the way to address inequalities in health.
The most significant change, which addresses many of the issues raised, is that the existing duty in Section 35 of the 1977 Act so far has merely required a PCT to make arrangements for dental practitioners to provide dental services, where a dentist has agreed to undertake dental treatment.
Under Clause 166, PCTs will be given a new duty to provide or secure the provision of primary care dental services either through contracts with individual practices or by providing services themselves. That evidently significantly strengthens the PCT's role in local service provision. It is also entirely consistent with our intention to shift the balance of power to front-line staff. It will make a big difference to patients not least because we will be requiring dental health colleagues to assess local oral health needs in order to tackle long-standing oral health inequalities.
As noble Lords have said, for the first time since the foundation of the NHS, by breaking the link between fees based on items per service, primary care dentists will be given an opportunity to focus on prevention and health promotion as well as treatment. New contracts for dentists based not on items per service but on the full range and level of services available to patients will provide additional stability for practice incomes and a greater guarantee for patients and for the PCT. As the noble Earl, Lord Howe, said in his amendment, they will provide greater opportunities to engage the whole dental team and allow them to spend more time with patients.
For the first time, we will have a predictable level of service locally. We have been talking about concepts of reasonableness. That is very much a part of reasonableness that we have never had in the past. It will enable the PCT to provide up-to-date and accurate information for the public about the services for which it is responsible. For those reasons, because we believe that the whole thrust of what we are trying to achieve will promote dental public health in a way that meets the needs of our time—in fact it is long overdue—we do not feel that Amendment No. 432 is necessary, although we are sympathetic.
Amendment No. 431 would extend the PCT duty in relation to the provision of primary dental services by removing the qualification of reasonableness. Questions have been asked about what it means to

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be reasonable. As my noble friend's letter to noble Lords explained and as was debated in the other place, the words,
"to the extent that it considers necessary to meet all reasonable requirements",
have been carefully chosen because they mirror the current Secretary of State general duty under Section 2 of the 1977 Act to,
"provide throughout England and Wales, to such extent as he considers necessary to meet all reasonable requirements".
However, I stress that the wording was amended in the other place in response to requests to bring the PCT duty unambiguously into line with that of the Secretary of State.
The most important test of reasonableness is to ensure that there is no postcode lottery. The PCT discretion will indeed be subject to national bench-marking—the noble Earl, Lord Howe, raised that issue—but with operational responsibility that will recognise variations in relation to local geography such as those between rural and urban areas for example. Time and distance standards will be used to measure compliance with the Prime Minister's pledge made some time ago about everybody being able to reach an NHS dentist. The distance travelled to reach a dentist practice, or time to wait for an urgent or routine dental appointment could be measured, because we are in the process of developing our criteria in this new scheme of things. We will be looking at ways of measuring and testing the concept of reasonableness.
I agree with Amendments Nos. 430E and 434A that publication of local bench-marking is desirable and I propose that it should be published. I agree that any local access targets should be agreed by the PCT during the public part of its board meeting. In that way, PCT decisions can be subject to public scrutiny. Indeed, Section 11 of the Health and Social Care Act 2001 places a duty on local health bodies to hold a public consultation on the proposed configuration. Users of those services need information to make a judgment about one of those services to meet the needs and wishes of people in the area. The performance of PCTs in relation to their new duty under Section 16CA will be a matter for performance management by the strategic health authority. I think that that meets the needs of transparency and openness.
Amendment No. 431 attempts to remove the reference to reasonableness. I do not accept that the PCT's duty under Section 16CA should be any different from that of the Secretary of State's duty under Section 3 or a PCT's duty under Section 16CC in relation to primary medical services. We therefore find it difficult to accept Amendment No. 431.
Amendment No. 433 raises the important issue of funding for the service. I should like to give the noble Baroness, Lady Barker, some reassurance on that. We acknowledge that the existing funding arrangements have been unsatisfactory. They reflect not the NHS's need to secure the needs of patients but the varying willingness of dentists to treat

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patients. From now on PCTs will have a duty to secure the provision of primary dental services either through contracts with individual practices or by providing services themselves. With these new responsibilities will go the £1.2 billion (net of patient charges) of financial resources that are currently held centrally.
I make the important point that once the reformed system is in place it will be possible over time to adjust NHS allocations to take into account the health inequalities that persist under the old system. 1 can give the Committee the important guarantee that current spend will be protected. We are taking some short-term measures until the implementation of the Bill enables the NHS to address historical anomalies, with additional funds being deployed to support PCTs as they get to grips with the new agenda. I think that some of that funding was mentioned in the letter that we sent to noble Lords.
However, in the longer term allocations have to take into account oral health needs as well as other health needs in general allocations. This is a "once and for all" opportunity to do that. For some areas, that might mean relatively more funding for dentistry in future as PCTs begin to address the long-term oral health inequalities that some of them face. I think that the audit report showed very graphically the tremendous regional variation in the number of dental caries in children under five and young people. We must tackle that issue. So as my noble friend made clear in the letter to noble Lords, we will set a floor on the spending on primary dental services below which the PCT may not fall. By doing so, the financial resources allocated for dental services will be used for the purpose for which they were allocated.
An important feature of direct allocation of resources to the PCT is that should a provider reduce commitment to NHS services under the new scheme, the PCT will retain those funds to commission from an alternative provider. With those important reassurances, I hope that the noble Baroness will not press Amendment No. 433.
Amendment No. 434 suggests that PCTs should provide services in accordance with identified local need. However, it is implicit in the duty that PCTs will have regard to local needs. A most important feature of NHS dental services is that the public can use the service where most convenient, and for adults that may be where they work rather than where they live. The example of those who commute into London was given in another place. That is what we mean by catchment area rather than a residence area. It means that the dental services provided must reflect the needs of users of •the service, not just its resident population. That is one of the great benefits of the service at the moment. So on those grounds I would suggest that Amendment No. 434 is unnecessary.
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Amendment No. 435 requires PCTs to ensure that services which are currently provided are secured. The current treatment functions of the Community Dental Service will continue under PCT-provided primary dental services, PCTDS. Such services will include the provision of treatment to patients who might not otherwise seek treatment—for example, patients with special needs and patients with phobias as well as treatment on referral. Then we have the specialist elements such as orthodontics and minor oral surgery where CDS staff have developed skills. Over the years, the CDS has developed considerable expertise that we do not want to lose. However, integrating those treatment functions of the CDS under the new name "primary dental services" in the Bill will strengthen those functions rather than rely on guidance to PCTs which is the current basis. That, plus changing the way in which dentists are paid and moving away from item of service, will enable dentists providing services under a CDS contract to spend more time with their patients.
New powers under Section 16CA(2) will enable PCTs to commission specialist dental services, such as orthodontics, from experienced high street dentists, who are very accessible. That will ensure that the developing dental specialties are given the right opportunities to contribute to patient care because they will be able to pick up from appropriate referrals. Therefore, Amendment No. 435 is met by our intentions.
I have much sympathy for Amendment No. 436. A recurrent theme running through the Audit Commission report, the Office of Fair Trading report into private dentistry and Options for Change is that information about what services are available and how the public might access them is generally very poor and difficult to understand. We are committed to improving the patient experience of the NHS and to promoting patient choice by providing accurate and easily understood information about the services available and what patients might reasonably expect from them. That is why we have included the specific provision in subsection (3) of the proposed PCT duties in relation to primary dental services.
We have concluded that that is best dealt with through regulations. Requirements are bound to change over time as providers' abilities to provide information improve. Statistical information will change, as will ways of dealing with it through ICT and so forth. The regulations will contain a level of detail that justifies a regulation-making power. Subsection (3) makes provision for information about the primary dental services for which the PCT is responsible, and so, by definition, the NHS dental provision in its area.
The task of compiling information regarding non-NHS treatment for which the PCT has no statutory duty seems unreasonable to impose on PCTs. Our policy is that, in the first instance, complaints should be resolved through practice-based procedures. Information about complaints is better dealt with under GDS and PDS contract provision rather than

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here. I can see no benefit in including examples where these are unnecessary. I therefore reject Amendment No. 436.
The noble Earl, Lord Howe, raised issues about workforce planning review and the increased need for dentists, in general. He is absolutely right. The workforce planning review is continuing its work. However, there are very positive signs—for example, the number of dental therapists has increased significantly. On looking at the capacity for this new service to meet the new needs of the dental service, two points can be made. First, it will encourage bigger practices and a better distribution of professional services with the development of ancillary professions and so on, which is very much to be welcomed.
Secondly, the fact that we are moving away from item of service will mean that the dental environment will become more positive and more preventive, which we hope will encourage young people to go into dentistry as a career because the work will be more satisfactory. In terms of capacity, there are some very positive points to make about workforce planning in the whole environment. With those assurances, I hope that the noble Lord will feel able to withdraw his amendment.
Lord Colwyn: Obviously, that is a helpful, long and explicit answer, for which I am grateful to the Minister. There is possibly no reason why the reasonable and local need amendments could not exist together. However, if there is a national bench-marking system in place, it might be redundant. The issue is whether the bench-marking system would be treatment-based—specifying the types of treatments that must be purchased—or whether it would be outcome-based, which is specifying the general level of dental health that must be achieved in each PCT area. The latter type of bench-mark might mean that any reference to local need is redundant. Once again, I thank the Minister for that long answer. At this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendments Nos. 431 to 436 not moved.]
Clause 166 agreed to.
Clause 167 [Dental public health]:
3.15 a.m.
Earl Howe Earl Howe moved Amendment No. 437:
Page 82, line 5, at end insert "provided that these functions include school screening as well as oral health promotion and local oral health surveys to help plan services"
The noble Earl said: We see in Clause 167 that PCTs are to be given new statutory functions in relation to dental public health, including oral health promotion, surveys and school screening. At least, that is my assumption. It is good news, but the British Dental Association feels strongly that the Bill needs to spell out those functions or, at the least, the Government need to make clear how they are to be delivered.
The existing duty for dental treatment and dental education in schools will cease to have effect under subsection (2), so it is important that there should be clear policy guidelines on dental public health issues, not least setting out how oral health inequalities are to be identified and tackled, and how a more preventive approach to dentistry is to be encouraged. Amendments Nos. 437 and 438 cover that point.
Moving on to Amendment No. 440, bearing in mind that these will be brand new PCT functions and that there is very little detail on the face of the Bill with as yet no published guidance, I believe that it is not unreasonable to propose, as I do in my amendment, that the regulations governing Clause 170 should be introduced via the affirmative procedure. The Minister will know that, notwithstanding the support of the BDA, which I acknowledge, there is intense unease, bordering on scepticism, about the ability of PCTs to deliver fully-fledged dental services for their patient populations. That is not only because PCTs know next to nothing about dentistry, but also because the money being devolved to them is likely to prove woefully insufficient for anything more than emergency cover. That money will not even be ring-fenced.
Many dentists fear that these changes have put paid to any hoped-for renaissance of a proper national dental health system. We could see a repeat of what has happened in education. Over time, practices will be starved of funds by PCTs, which will blame central government for not paying them enough. Central government will claim that they have paid the money and no one will quite know where it has gone.
However, accepting that PCTs are to be given the job of commissioning dental care in their local areas, what mechanisms will be in place to ensure that, locality by locality, dentistry is not squeezed out by other priorities? How will the Government see to it that dentistry across the country as a whole is receiving an appropriate share of the health budget?
The mystery to me is how the Government think that the new payment scheme for dentistry is going to improve access to dental healthcare or ensure that more people benefit from regular dental check-ups than is currently the case. There do not seem to be any incentives in the system to encourage dentists to increase their productivity. I believe that all these concerns merit a full debate when the new regulations are laid. It would be helpful if the Minister could say when she expects that to take place. I hope that she will look constructively on my amendment for the reasons that I have given. I beg to move.
Baroness Andrews: Perhaps I may begin by addressing the questions put to me by the noble Earl, particularly with regard to how we expect the payment scheme to encourage access to dental services. I shall cite one of the ways in which we expect this to happen. At the moment we have one contract for all dentists with payments geared essentially to the number of treatments. That increases activity; higher fees are paid for the greatest

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activity and so forth, while there is no incentive to take on preventive work or to offer different kinds of treatment. For example, within that framework is a provision for six-month check-ups for people who do not need check-ups every six months, along with a whole range of routine work which essentially fills a dentist's diary and generates the income.
One of the reasons for introducing individual contracts that are more flexible and geared to the real health conditions and needs of people is that dentists will be able to decide on the clinical pathway for people who require dental support and therefore will not have to see every patient once every six months; rather they will be able to tailor appointments according to an individual's health needs. This will create more freedom for additional patients to be taken on, for example, and for dentists generally to offer a different kind of service and to expand their practices in different ways. That is one suggested answer to the question.
We do not have a precise date for publication of the regulations but it is full speed ahead. I can assure the Committee that there is tremendous enthusiasm in the Department of Health for developing and achieving these provisions now that we have come so far.
The amendments raise very important issues and make the same provision in relation to both England and Wales. They attempt to ensure that the dental public health functions which are currently undertaken by the community dental services in both countries are included in the regulations setting out the new dental public health duties of PCTs and local health boards.
The Community Dental Service is currently provided by primary care trusts and some NHS trusts to ensure that people who might not otherwise seek or receive NHS dental care—such as patients with special needs—can receive it. The CDS also has dental health functions in relation to oral health promotions, school screening and dental health surveys. These functions are set out in the guidance HSG(97)4. The major change we are making is for dental public health functions to become the functions of PCTs and included in regulations because they are obviously an important part of the contribution made to dental public health locally.
So the changes we propose are designed to strengthen the work of the current CDS. First, Clause 167 seeks to insert a new Section 16CB into the 1977 Act. Subsection (1) provides for regulations to confer those dental public health functions directly on PCTs. It is indeed intended that the functions will include oral health promotion, school screening and surveys to plan and manage dental health services locally.
Secondly, the primary dental services provided by the PCTs under new Section 16CA(2) will be equivalent to the treatment function of the CDS. That is in line with the recommendations in Options for Change. PCTs may act jointly in discharging this
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function and they can involve other agencies, such as dental practices, in addition to primary dental services.
The Government set out their intention to review the school dental screening programme in the "Improving Oral Health" chapter of Modernising NHS Dentistry. We said in the letter that we sent to all noble Lords that the child health subgroup of the National Screening Committee is awaiting the outcome of the research into child dental health screening and the regulations made under subsection (1) will reflect its advice, when published. I would expect to see other functions added as well.
As regards Amendment No. 437, it would not be wise to have unnecessary detail, which may ultimately prove to be inappropriate or inflexible, imposed by amendment on the Bill. This could hinder the movement of services between these population-based dental public health functions and the patient-based preventive services under the GDS contracts.
We regard all these dental public health functions as extremely important objectives for the reasons I have given. I know that the noble Earl will be disappointed, but we consider that the affirmative resolution procedure is too heavy for this regulation-making power. For the sake of consistency, we should also reflect on the fact that regulations made under the provisions in Part 4 will be subject to the negative resolution procedure in keeping with the existing equivalent powers—for example, The NHS (Functions of Health Authorities)(General Dental Services Incentive Schemes) Regulations and so on.
Amendment No. 440 seeks to bring the regulation-making power in relation to dental public health functions conferred on PCTs and LHBs within the affirmative resolution procedure. But, as with the previous amendment, that does not give us the flexibility that we need. Amendment No. 438 relates to LHBs in Wales.
We are serious about these functions. I hope the noble Earl will understand my explanation of why we find it difficult to accept his amendments and that he will feel able to withdraw them.
Earl Howe: As ever, the Minister has been most illuminating, and I am grateful for the trouble she has taken to respond in such detail to my amendments. I am, of course, a little disappointed that she was not able to look more favourably on them, but she has explained some of the darker corners of these provisions very helpfully.
My reason for seeking a slightly more robust parliamentary procedure on the face of the Bill is, as I have said, because we are looking at an empty box at the moment—there is no published guidance. In those circumstances, I think there is justification for Parliament to be guaranteed debating time on the regulations.
Nevertheless, I take note of what the Minister said and will reflect further. I beg leave to withdraw the amendment.

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Amendment, by leave, withdrawn.
[Amendment No. 438 not moved.]
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 439:
Page 82, line 7, at end insert—
"( ) A general dental services contract must require the contractor or contractors to provide for this or their patients—

(a) information about treatment charges;

(b) access to dental records;

(c) alternative local provision and the complaints procedure; and

(d)other such information as may be determined."

The noble Lord said: The Minister will notice that once again, we are so enthusiastic about Amendment No. 439 that we have put it down twice. We obviously expect the Minister's response to be twice as long as she would normally feel obliged to give.
We strongly support the OFT's recommendation that dentists should provide consumers with clear information on indicative prices for common treatments, detailed treatment plans—together with information on any other options and estimates of the likely costs—access to dental records and complaints procedures. This kind of information is fundamental to the delivery of a patient-centred service and to any notion of patient choice.
Existing guidance to dentists from the General Dental Council—the GDC—already covers much of this, yet it is clearly not being observed by the majority of dental practices. It is therefore crucial that appropriate mechanisms are put into place to strengthen the requirements in this area and ensure compliance.
Additionally, we on these Benches strongly support the idea that dentists must also inform consumers about the availability and likely cost of NHS care and how to find an alternative dentist offering NHS treatment if they cease to offer this.
Consumers tend not to look for a different dentist, even if their usual dentist stops providing NHS care. This was confirmed by research by the Consumers' Association earlier this year; it found that 48 per cent of Scottish consumers currently registered with a private dentist had stayed with the same dentist when they switched to providing private-only care. Without even this most basic information, consumers are likely to be a captive audience and unable to exercise an informed choice. Stipulating this key information provision as part of the contract should go some considerable way to addressing this, backed up by enforcement from the PCTs and CHAI. I beg to move.
Lord Colwyn: I support the amendment. Information about local dental services is absolutely fundamental. It is quite true that most people do not really know where to get the information about their local service. This amendment is very important for that reason.
Baroness Andrews: I am sorry to disappoint the noble Lord, Lord Clement-Jones, but I think my
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speaking notes on this amendment are about half as long. We are at one on this and we welcome the support of noble Lords to the commitment to improve the information available to patients. All the evidence—and this is well documented—suggests that the current system is not good enough by any standard.
Of course patients need to be able to make informed choices in all the instances that the noble Lord detailed. Our experience over five years of piloting personal dental services is that that is best done through national requirements and national criteria. We propose to take the necessary provisions in proposed Section 280(2) under Clause 168 rather than proposed Section 28 L and Clause 167 where these amendments replace them. We are also committed to the field sites that are being set up by the Modernisation Agency. The 15 or so field sites are pioneering new ways of doing everything from remuneration to information. A number of them are concerned with testing ideas to improve the patient experience.
Fully tested information from the sites will become available over the next two years. We want to incorporate those into the GDS contract as they evolve in the transition period and beyond. That is best done through a national contractor requirement, and we believe that the provisions set out in new Section 28 are already sufficient. For example, new Section 280(2)(f) already provides for,
"rights of entry and inspection (including clinical records and other documents)".
I hope that we can meet the information needs and requirements that the noble Lord set out, and that it will be successful.
3.30 a.m.
Lord Clement-Jones: I thank the Minister for her reply. If it were a different time in the morning, I might get excited about pioneering field sites, but I cannot quite raise enough enthusiasm. I am sure that tomorrow morning I shall feel a whole lot different about the nature of those field sites.
I believe that I heard the Minister say that the regulations published under Clause 166 would essentially contain the same elements as set out in the amendment. If that is the case, I would be only too pleased with that. However, it must be made quite clear that there are certain key elements, whether the provisions are in the primary legislation or the regulations. Those are the elements that the OFT has specified, and the ones that I set out in my introduction to the amendment, which should be included if there is going to be "improving patient experience", as the Minister called it. If that is to happen, those elements must be contained within it. On that basis, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Lord Colwyn Lord Colwyn moved Amendment No. 439A:
Page 82, line 7, at end insert—
"( ) A Primary Care Trust will include a qualified dentist on any professional executive committee or equivalent committee, and secure consultant level dental public health advice, to secure the discharge of its functions in relation to dental public health.
( ) A Local Health Board will include a qualified dentist on any professional executive committee or equivalent committee, and secure consultant level dental public health advice, to secure the discharge of its functions in relation to dental public health."
The noble Lord said: The amendment would ensure that there are dentally qualified staff at PCT and LHB level to properly commission, manage and co-ordinate local dental service delivery.
While dentists and the British Dental Association are keen to work closely with PCTs and LHBs to ensure that the new commissioners understand issues of dental and oral health, that is no substitute for the presence of appropriately qualified staff within the PCTs and LHBs themselves. The transfer of responsibility for dental commissioning in PCTs does offer some exciting opportunities for co-ordinated and consistent delivery of dental services tailored to specific local needs.
In order that these opportunities are not squandered, there is a need for proper understanding of the complex issues involved. Dental public health is a wide area and its scope includes more than just screening, for example. It covers both the full range of dental public health activities and the links between dentistry and issues such as diet, nutrition, and tackling health inequalities. It is important that professionals who understand those issues and links are involved in the commissioning of services.
Ideally I should like assurances that there will be a dentist on the professional executive committees of all PCTs and LHBs. The BDA would also like there to be a dentally qualified dental public health adviser, who fully understands the issues of dental and oral health, available at consultant level to the PCT or LHB. The terms of this amendment are worded more generally, however, to take into account any changes or variations in terminology that may arise. Again, the Minister kindly referred to the matter in his letter to me, and I feel that he will be sympathetic. I beg to move.
Lord Hunt of Kings Heath: I have a great deal of sympathy with the noble Lord's comments. The problem with the amendment is that it sets a precedent. If the measure applies to dentists, why should it not apply to nurses? If it applies to nurses, why should it not apply to pharmacists? If it applies to pharmacists, why should it not apply to members of the allied health professions? If you go down that route, the primary care trust ends up with very little discretion about appointments to its board and the professional executive committee.
Given that all Members of the Committee have expressed themselves utter devotees of devolution, we should leave PCTs with enough room to manoeuvre. That said, I hope that my noble friend will be able
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to answer the substantive point that the noble Lord raised. If we are really to make a success of the new contract, and if we are to get dentistry back in alliance with the NHS, it is essential that there is dentistry leadership at the PCT level, whether it is a public health dentist or a dental officer who has been appointed. Perhaps between now and Report my noble friend will give further consideration to ways in which we can strengthen the dental profession working alongside primary care trusts. Over many years there has been a disengagement not just between the health service and dentists but also in the vast reduction in the capacity of the NHS to engage with local dental committees.
These clauses are great news for patients who wish to receive NHS dental services. The contract and the discussions with the BDA offer great promise for the future but it is essential that primary care trusts have the ammunition and the expertise to take forward these programmes effectively.
Baroness Andrews: I am grateful to both noble Lords who have spoken. We all recognise the commitment of the noble Lord, Lord Colwyn, to his profession over the years. I have every sympathy with the intention behind Amendment No. 439A. I can reassure the noble Lord, Lord Colwyn, that the points he raises, both on dental public health advice and on dental membership of PCT executive committees are already covered by the PCT Executive Committee (Membership) Directions 2003.
Article 2(2) requires the executive committee to include at least one public health member. The directions further make clear that a public health member means a member of an executive committee who has qualifications and experience as a specialist in public health or who is a consultant in public health medicine or a consultant in dental public health.
Article 2(5) of the directions states that the professional members shall include medical practitioners, nurses and such professional members as, in the opinion of the trust, reflect the functions carried out by the trust. I am advised that the Local Health Board Constitution Regulations already make similar provision. Regulation 3 specifies the membership of a local health board, which includes a dental practitioner member. It also makes provision for the co-option from time to time of such other members as appears necessary or expedient for the performance by the board of its functions.
Shifting the balance of power in the NHS to the front line means leaving much decision-making to the PCTs, which themselves understand the requirements of the service at the local level. I would not want to be seen as micromanaging the NHS by putting such requirements on the face of the Bill. Directing PCTs about their governance arrangements is perfectly adequate.
My noble friend is absolutely right. There is an opportunity here for the first time for dental practitioners to work much more closely with the

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PCTs that will commission and direct work, plug the gaps in the service and work in partnership to develop the contract. I hesitate to mention field sites again, but they represent a way of testing new partnerships with PCTs, for example. That will be a way of developing shared values and understanding of the profession and the role it plays in general public health as well as in dental public health. I hope that with those assurances the noble Lord will be satisfied and will withdraw the amendment.
Lord Colwyn: I am grateful to the noble Baroness for that reply and for the remarks of the noble Lord, Lord Hunt. Over many years dentists have always felt left out of these matters. The reply was encouraging. I shall read what the noble Baroness said and reserve the possibility of returning to the matter at the next stage. In the mean time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 440 not moved.]
Clause 167 agreed to.
Clause 168 [General dental services contracts]:
Baroness Noakes Baroness Noakes moved Amendment No. 441:
Page 82, line 40, after "contract," insert—
"( ) the requirement for the contractor to collect charges for dental services under section 79 of the 1977 Act, to pay them to the Primary Care Trust or Local Health Board and to comply with financial control requirements regarding charges for dental services as specified by the Primary Care Trust or Local Health Board."
The noble Baroness said: I shall speak also to Amendment No. 442. Both amendments are probing on the financial aspects of the new dental contract.
Amendment No. 441 amends Clause 168, which inserts new Section 28K into the 1977 NHS Act. It adds another area that general dental services contracts could cover; namely, the requirement for the dental contractor to collect dental charges, pay them to the PCT and comply with financial control requirements.
In moving from a system under which the dental practitioner is responsible for collecting and keeping dental charges, to the new system where risk related to that dental charging income is borne by the PCT, there are likely to be difficulties. The old system had many incentive effects that were not attractive but at least it placed the incentive for collecting charges fairly and squarely on the dental practitioner. If he did not collect, he would be out of pocket.
We are now moving to a new system where the dental practitioner will collect dental charges on behalf of the PCT and account to it for them. That raises a number of issues that I hope that the Minister will address. How will PCTs incentivise dental practitioners to charge for and collect all the income that should be collected? How will the PCT ensure that there is no fraud or error? Will the PCT have audit rights in relation to the dental practitioner's books and records? Will PCTs be able to lay down minimum standards of record-keeping?
In addition, what costs are likely to fall on dentists for complying with any new requirements? The regulatory impact assessment makes it clear that most dentists are small businessmen. How will the Government ensure that any regulatory burden associated with the new scheme is minimised?
Amendment No. 442 deletes new Section 28N of the 1977 NHS Act, which will be inserted by Clause 168. New Section 28N allows the Secretary of State to have pretty complete control over payments made under general dental services contracts. Our amendment knocks that out of the Bill on a probing basis.
We had understood that the thrust of the new arrangements for dental services was to give new responsibilities to PCTs to provide primary dental services in their areas. That is much wider than their existing responsibilities. However, we do not understand how that can work in practice if the PCTs are hamstrung by remuneration terms laid down by the Secretary of State.
I assume that the moneys used by PCTs to pay for dental contracts are part of the much-vaunted 75 per cent of NHS money now being delegated to PCTs. What freedoms will the PCTs have in practice to use their financial resources to achieve better primary dental care services? For example, can they pay additional amounts if market forces locally require higher payments in order to achieve desired access levels? What freedoms, if any, will they have to use finance as a bargaining counter in setting satisfactory contracts? I beg to move.
Lord Colwyn: Very briefly, I want to say how incredibly complex the issue is. It has been a concern for dentists for many years. I remind the Committee that, at present, on people who are not exempt, GDPs collect 80 per cent of the full cost of the treatment. Bad debts exist; it is a problem. So far as I am aware, the new charging system for primary dental care is under discussion by Harry Cayton, the patients' tsar. I suspect that the Minister may not be able to answer on all the points raised, but the subject is no doubt evolving. Will the system be centralised, with overall central control, or will it purely be based in the PCTs?
3.45 a.m.
Baroness Andrews: I am grateful to the noble Lord. I cannot answer all those questions. I can answer some of them to some extent, but many of them will be answered by testing out systems of remuneration in the field sites themselves. Apart from anything else different ways of paying dentists are being looked at. I shall come to that.
I shall help by dealing with the amendment and setting out briefly how we intend to manage the transition from the current general dental services to local contracting and a GDS contract. Work is under way in the field sites to test new commissioning and remuneration models, among other innovations. The first field site draft contract templates will be

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available in January 2004. Learning from those sites will be ongoing beyond April 2005 for their lifespan. Additionally, some of the field sites are working with the PCTs and the strategic health authorities to develop monitoring and performance management systems to support the commissioning model. It was important—and this ran through Agenda for Change and the whole dialogue with the profession—that matters had to be tested first and there had to be robust mechanisms for learning from those tests.
Drawing on that programme and the personal dental services pilots, to ensure a smooth transition, the Department of Health has been working closely with the British Dental Association to develop a simple and robust base contract that all PCTs and practices will be able to put in place from April 2005. Under those arrangements, from April 2005, unless any local variations are agreed, the Dental Practice Board and its successor the special health authority will continue to pay dental practices contracting with the PCT broadly the same level of income for broadly comparable levels of activity—increased by any nationally agreed uplift following the DDRB's recommendations.
In answer to one of the specific questions asked by the noble Baroness, Lady Noakes, the collection of charges will be a contractual requirement, and the special health authority which will replace the DPB will verify the correct collection of charges and will report to the PCT. So there will be an audit mechanism in that form.
Amendment No. 441 seeks to make collection of patient charges and payment of them to the PCT a contractual matter under a GDS contract. Under the current arrangements, dentists collect patient charges from those patients liable to pay them and the NHS makes payments to dentists by way of remuneration, net of the charges collected. It is intended to continue this procedure under the new charging regime introduced under regulations made under a new Section 79 of the 1977 Act, which is inserted by Clause 179 of the Bill.
Subsection (3) of new Section 79 enables regulations to provide that sums which would otherwise be payable by a PCT, local health board or special health authority to providers be reduced by the amount of the charges authorised by the regulations. Harry Cayton, the director for patient experience and public involvement, is leading a review of patient charges for NHS dentistry. He will report next March. Part of that review will look at the ways of collecting patient charges. The current system works well and, from the NHS perspective, is simple to administer and has minimal bureaucracy. However, Agenda for Change reported that the profession would prefer to separate the direct link between patients' visits to the dentist and charge collection. The Government are sympathetic to that view, because we consider that collecting PCT charges and then remitting them to the PCT would be unnecessarily bureaucratic.
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While the technology is available to collect payments through smart cards, by mobile phone and so on, we will be interested in any of those ideas that may be put forward by Harry Cayton's review group on alternative ways to pay charges. We consider that dentists collecting charges and remitting them to the PCT will be unnecessarily bureaucratic and until the technology is available we intend that dentists and dental practices be paid for the provision of primary dental services net of the patients' charges collected. Therefore Amendment No. 441 does not find favour.
As regards the technical questions which the noble Baroness asked on Amendment No. 442, I shall have to write to her. However, perhaps I may explain that Section 28N(1) allows the Secretary of State or the Assembly to give directions regarding payments to be made under the new GDS contracts. Where directions are made, a GDS contract must require that payments are made under the contract in accordance with the directions.
New Section 28N replaces the existing system of remuneration for dentists providing general dental services under Section 35 of the 1977 Act. The rules setting out the remuneration are currently contained in the statement of dental remuneration. The SDR is a determination made by the Secretary of State or the Assembly under Regulation 19 of the National Health Service (General Dental Services) Regulations 1992.
Under Section 28N, payments in respect of any particular matter under the contract can be set on a national basis. Directions may relate to payments to be made by a PCT to a GDS provider or by a GDS provider to a PCT. Where there are no applicable directions, the parties to the GDS contract are free to determine the remuneration to be paid under the contract.
Subsection (3) sets out how the power to make directions may be exercised. It will enable directions to provide for payments to be determined by reference to the meeting of particular standards, for example. Directions may also be made in respect of individual practitioners and so would enable, for example, payments to be made in respect of a dental practitioner's maternity. That is why we need national scope for that.
Subsection (4) of new Section 28N recreates the existing requirements in Section 43B of the 1977 Act for the Secretary of State or the Assembly to consult representative bodies on remuneration matters. Under the new multi-professional GDS contract, this extends consultation rights to other groups whose members can become GDS providers—for example, representatives of other groups of dental healthcare professionals whose remuneration might also be affected.
Subsection (5) provides for directions to be made by regulations or by an instrument in writing and for directions made by an instrument in writing to be revoked or varied. Subsection (6) sets out some examples of what payments under this section include; namely, fees, allowances, reimbursements, loans and repayments.

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Representatives of the dental profession, in the interests of fairness to their members, are keen to preserve the ability to continue setting some payments under GDS contracts on a national basis. The payments which give the most concern are those in respect of a particular individual at the practice; for example, payments in respect of maternity. It is thought by the profession to be in the interests of fairness if such payments are determined nationally.
I realise that that was a detailed and complex explanation. However, I hope that the noble Baroness will accept it and withdraw her amendment.
Baroness Noakes: I thank the Minister for taking the trouble to attempt to give me a comprehensive reply. I cannot pretend that it is wholly satisfactory. I asked, for example, about the incentive mechanisms that would exist to ensure that dentists collected the correct money for PCTs. That is still on the table. I asked about the freedoms of PCTs and I did not get an answer.
Much of what the Minister said took me back to our first couple of Committee days when we debated foundation hospitals. The ongoing theme was that the Government were making it up as they went along. I feel that that is the case with these dental arrangements because so many of the details are not worked out. It is almost not the time to consider the Bill.
Nevertheless, I thank the Minister for attempting to answer the questions. I shall of course read what she said before deciding what to do at the next stage.
Amendment, by leave, withdrawn.
[Amendment No. 441A not moved.]
Lord Warner Lord Warner moved Amendment No. 441B:
Page 83, line 23, leave out "or section 17C employee" and insert "employee, section 17C employee or Article 15B employee"
The noble Lord said: This group of amendments makes a number of minor, technical changes. Many of the amendments cover personal medical services and personal dental services in Northern Ireland. References to "Article 15B employee" and "Article 15B arrangements" are inserted into Clauses 168, 171, 173, and so on. This is a UK-wide contract and the amendment seeks to treat Northern Ireland primary medical services and primary dental services employees in exactly the same way as Scottish and English employees in equivalent schemes.
Amendment No. 459E makes clear that any regulations made under Section 28E may include provision for the resolution of disputes as to the terms of any proposed Section 28C arrangement. This allows for equivalent provision to be made in primary medical services as applies in general medical services.
Amendment No. 461A amends the power in new Section 28W to make regulations in respect of payments to be made to a person suspended from the list. As written, the power is restricted to payments made by a PCT or local health boards. However, in
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certain circumstances, it will be necessary for other bodies to be able to make such payments—for example, in respect of GP registrars, where payments would be made by the strategic health authority.
Amendments Nos. 464ZG and 477ZC make changes to allow the National Assembly for Wales to make regulations giving community health councils the power to enter and inspect the premises of persons providing services under Part 1 of the 1977 Act in England. That is equivalent to the provisions for the Secretary of State in respect of patients forums. I beg to move.
On Question, amendment agreed to.
Lord Warner Lord Warner moved Amendments Nos. 441C and 441D:
Page 83, line 26, leave out from "individual" to end of line 31 and insert "falling within section 28D(l)(bc) above"
Page 83, line 44, leave out "and section 17C employee" and insert ", "section 17C employee" and "Article 15B employee""
On Question, amendments agreed to.
[Amendment No. 442 not moved.]
Earl Howe Earl Howe moved Amendment No. 443:
Page 85, leave out lines 15 to 17.
The noble Earl said: In moving Amendment No. 443, I shall speak also to Amendment No. 455. Subsection (3) of the new Section 280 contains what appears to be a draconian provision. It allows for regulations to enable a PCT or LHB to impose a variation of the terms of a GDS contract. There is a similar provision in new Section 28U relating to the GMS contract.
If a dentist or a doctor has entered into a contract, it seems to me that he is entitled to regard that contract as binding on the commissioning body. We all understand that no contract can be set in concrete for all time and that it must be adapted to meet changing needs. However, I should be grateful if the Minister could explain what might justify a provision permitting one party to the GDS or GMS contract, but not the other, to override it. If changes are made to the contract, those should surely be by agreement. I beg to move.
Lord Warner: These amendments would remove a PCT's powers to vary GDS and GMS contracts respectively. For primary dental services, it is essential that PCTs have the power to vary GDS contracts in their area. The main need for the power is to ensure that any future changes to the contract regulations can be taken through into the contract. An example might be learning from field sites about patient information requirements. We might also propose a variation where it is necessary to meet a European Court of Human Rights obligation or where the failure of a PCT and contractor to reach an agreement would prevent the PCT fulfilling its statutory duty. That might be the case where the PCT was under a duty to provide certain information in the hands of the contractor.

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For primary medical services, it is also essential that PCTs have a power to vary GMS contracts in their area. The same arguments as I outlined apply. The new GMS contracts will reflect the national agreement that has recently been reached between the BMA and the NHS Confederation. Experience teaches us that future discussions will be needed to update the national contract in the light of changing circumstances. Without that power, we have no effective means of ensuring consistent implementation of new national arrangements.
Within the context of the national rules, GPs will have greater local flexibility around what services they provide and they will also have the choice of leaving the national GMS contract and entering into local primary medical service contracts. It is also recognised in the agreement document that negotiations may not always reach agreement. It is noted in the new agreed GMS contract document that failure to reach agreement would not prevent the Secretary of State or health ministers discharging their statutory obligations or exercising their statutory powers. The amendments would prevent the Secretary of State fulfilling those statutory duties. Therefore, I suggest that these amendments are not pursued.
4 a.m.
Earl Howe: I thank the Minister. That is a helpful reply. It casts some light on the subsection. The question posed by my amendment is: when is a contract not a contract? When is a practitioner entitled to regard his contract as one on which he can rely? The key word in the subsection is "impose". I still think from the examples given by the Minister, apart perhaps from the example of the judgment of the European Court, that in most instances there will be alterations of contract by agreement. I take his point. I am grateful to him for what he has said and no doubt the regulations, as and when they emerge, will specify in greater detail the circumstances that will allow contracts to be varied in the way in which the clause presupposes. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 168 agreed to.
Clause 169 [General dental services: transitional]:
Lord Colwyn Lord Colwyn moved Amendment No. 443A:
Page 86, line 26, at end insert—
"( ) A contractor or an employee of a contractor will be entitled to existing pension arrangements that were available to her or him at the time of enactment."
The noble Lord said: The amendment safeguards the existing pension arrangements of practice owners, associates and employees during transition to the new contracting arrangements. The dentists making the transition from the old to the new GDS arrangements may feel vulnerable and the issue of pensions is understandably important. I would like clear and unequivocal confirmation that pensions will be protected. A particularly vulnerable group is that of
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associates who face the potential change to their employment status as a result of the Bill as they may move from being self-employed practitioners to employed officer status.
While the details of associate employment status are still being worked through, there is a danger that some options on the table could significantly financially disadvantage those individuals. Others at risk are contractors who make a decision to vary their mixture of clients—for example, from mostly NHS to mostly private—at a point that coincides with the introduction of the new funding arrangements. The crude pension contributions of such contractors need to be protected, regardless of their new number of NHS patients. The Government need to send a strong signal that dentists' existing pension arrangements will be protected.
I had a very helpful letter from the Minister in which he said that the changes to pension arrangements as a result of local commissioning will not be to the detriment of any dentist currently working in the NHS. The way that he said that makes me think that they are planning to make changes to the pensions and I would like confirmation that they are considering the different demographic groups in dentistry: assistants, associates, those just starting out in the profession, those who have been in it for some while and those who are semi-retired. It is important that that differential element is carefully considered. I beg to move.
Baroness Andrews: Many dentists will have made a significant contribution to NHS dentistry and a considerable personal investment in their practices. We must ensure that they are able to continue to do so. Perhaps I could explain the context. Clause 169 sets out the framework for a transitional scheme which must be established by order to ensure that those dentists who are providing general dental services under the existing statutory arrangements are entitled to continue to provide primary dental services under the new GDS contracts.
It further enables those dentists who run practices limited to specialist treatments, for example orthodontics, where it would be inappropriate to provide the full range of dental treatments required by a GDS contract, to be entitled to continue to provide those services under a PDS agreement.
It may not have been possible for all dental practices to reach agreement on all the terms of a GDS contract by the time the new regime comes into being. So, as I have said previously, subsection (3) provides for there to be a "default or base contract", which is more closely related to the service previously provided under the GDS.
It would be unfair to expect dentists to accept contractual arrangements which are significantly less favourable than those on which previous GDS had been provided. Provision will be made to offer protection of legitimate practice earnings. That may be achieved under nationally determined GDS

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contract payments under Section 28N or by an order made under Clause 169 or achieved by using both powers.
Amendment No. 443A specifically raises the important issue of the entitlement of dentists working under GDS contracts, and for that matter under PDS contracts, to membership of the NHS pension scheme. Membership of the NHS pension scheme is increasingly seen as a major benefit of being part of the NHS family and can be impacted when dentists or doctors migrate between salaried posts in hospitals and independent contractor posts in general practice. We have recognised that. We have made an amendment to the NHS pension scheme regulations that will ensure that the scheme operates more flexibly in the future when dentists or doctors move between salaried and independent contractor status. The amendment will apply to the benefits of all dentists and doctors in post on or after 1st April 2003.
The letter sent by my noble friend has already been quoted. It states that changes to pension arrangements as a result of local commissioning will not be to the detriment of any dentist currently working in the NHS. The noble Lord asked me about the range of dentists, associates and so on. Clause 169 deals with transitional provisions. Subsection (1) ensures that a new contract must be offered to all principal dentists. That includes associates. I hope that reassures the noble Lord.
I can also give the noble Lord an important commitment in response to Amendment No. 443A. Changes to pension arrangements as a result of local commissioning will not be to the detriment of any dentist currently working in the NHS. I hope that with those reassurances the noble Lord will feel able to withdraw the amendment.
Lord Colwyn: I am grateful to the Minister for that answer. I am not an expert on pensions. I shall examine with the British Dental Association what the noble Baroness has said and possibly return to the matter. At this stage, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 169 agreed to.
Clause 170 [Provision of primary medical services]:
Lord Clement-Jones Lord Clement-Jones moved Amendment No. 444:
Page 86, leave out lines 39 to 41.
The noble Lord said: Clause 170 deals with the provision of primary medical services. Amendment No. 444 is designed to alter the situation currently contained in Clause 170. There are three kinds of primary medical services: essential, additional and enhanced. GPs have preferred provider status for essential and additional services but not for enhanced services. Enhanced services are, for example, some minor surgery, perhaps minor injury services, services for violent patients, flu immunisation, child immunisation, sexual health services and of course services such as out-of-hours services.
The clause makes radical changes to current arrangements. Under current arrangements GPs provide most of these services. Under the new arrangements contained in Clause 170, those services would now be able to be purchased by the PCO. In England that means the primary care trust itself. Indeed, it may be able to purchase services, such as out-of-hours services, from commercial deputising services. That may include non-NHS provision of services such as physiotherapy.
There has been some attempt to explain the new arrangements by both the Government and negotiators, such as the BMA, but it is not entirely clear why these arrangements should have been put into place and why it is necessary for these services to be provided in the way that they are. I notice that the Minister states in the letter that some of us have received that it is an essential part of the new system of primary care that has been negotiated with the General Practitioners Committee and the NHS Confederation. I should be interested to hear from the Minister why that should be so. Why is it so essential? Why have enhanced services been split off in that way from the other services to be provided? What benefits will that provide to patients in those primary care trusts? I beg to move.
Lord Warner: New Section 16CC is a fundamental part of the new system of primary care that has been negotiated by the General Practitioners Committee and the NHS Confederation. It allows PCTs to contract with a range of providers to secure primary services for people in their area. The majority of contracts for primary medical services will be between PCTs and GP practices—through either a GMS contract or a Section 28C contract.
However, it is essential that we give PCTs as much flexibility as possible to ensure that patients can access the full range of services. That is especially true where practices opt out of providing out-of-hours care or other additional services. PCTs will be under a duty to ensure that services are maintained for the patients affected. PCTs will be able to provide services themselves or, where appropriate, commission services from a range of other providers. For example, in the case of out-of-hours services, that would include NHS Direct, GP co-operatives, practice partnerships, paramedics, other GP practices or deputising services, including organisations such as Primecare.
The amendment would remove that flexibility. Let us consider an area where, at present, GPs delegate out-of-hours services to a commercial deputising service. Under the new contract, some GPs may well opt out of having primary responsibility. Suppose that the PCT wanted to recommission the service directly from the current commercial provider. Without that power, it could not do so.
We are also committed to expanding capacity in primary care. In some areas in which there has been a shortage of doctors for many years, the private sector may well be the best route to provide additional capacity to deliver NHS care. However,

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we remain committed to the contract agreement with the profession that makes clear that existing primary and general medical service practices will have preferred provider status for the new essential services. Again, the amendment would rule that out.
I hope that I have clarified matters for the noble Lord and that he will feel able not to pursue his amendment.
Lord Clement-Jones: I thank the Minister for his reply, although he has not clarified the matter to any great extent. Many ordinary patients will be baffled by his statement that many GPs will opt out of primary responsibility. That is a crucial aspect of the clause. It sits oddly with the Minister's statement that he is committed to expanding capacity. That seems strange, yet he relies on the fact that there is a contractual agreement over which we have no power. In those circumstances, I want to test the opinion of the Committee.
4.14 a.m.
On Question, Whether the said amendment (No. 444) shall be agreed to?
Their Lordships divided: Contents, 8; Not-Contents, 39.

Division No.5

CONTENTS

Barker, B.[Teller]

Howe, E.

Blatch, B.

Noakes, B.

Clement-Jones, L. [Teller]

Roper, L.

Colwyn, L.

Skelmersdale, L.

NOT-CONTENTS

Acton, L.

Gordon of Strathblane, L.

Amos, B. (Lord President)

Grocott, L. [Teller]

Andrews, B.

Hollis of Heigham, B.

Archer of Sandwell, L.

Hoyle, L.

Bach, L.

Hunt of Kings Heath, L.

Bassam of Brighton, L.

Jones, L.

Brett, L.

Jordan, L.

Brooke of Alverthorpe, L.

McIntosh of Haringey, L.

Burlison, L.

McIntosh of Hudnall, B.

Campbell-Savour, L.

MacKenzie of Culkein, L.

Carter, L.

Chandos, V.

Pendry, L.

Crawley, B.

Plant of Highfield L.

Davies of Oldham, L. [Teller]

Sawyer, L.

Dean of Thornton-le-Fylde. B.

Simon, V.

Desai, L.

Warner, L.

Evans of Temple Guiting, L.

Warwick of Undercliffe, B.

Farrington of Ribbleton, B.

Whitty, L.

Golding, B.

Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.
4.23 a.m.
Lord Roper: We have now spent more time since 10 p.m. considering this Bill in Committee than we did in the whole of the time after Starred Questions until 10 p.m. Will the Government Chief Whip accept that
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there is now a need for further consultations about progress on the Bill? Otherwise, it will be difficult to maintain the co-operation between the usual channels. That co-operation has taken this Bill a long way forward tonight, but further progress may become increasingly difficult.
Lord Grocott: I suggest that we have a discussion in the normal way. Meanwhile, we should proceed with the next amendment.
Lord Skelmersdale Lord Skelmersdale moved Amendment No. 445:
Page 87, line 9, at end insert—
"( ) Regulations under subsection (5) may not be made unless a draft of the regulations has been laid before and approved by a resolution of each House of Parliament."
The noble Lord said: As the noble Lord, Lord Clement-Jones, has failed to get satisfaction on what exactly the Government intend on Clauses 170 and 171, it falls to me to have another crack. Subsection (5) of Clause 170 provides a regulatory power to clarify what should or should not be considered as primary medical services for which PCTs and LHBs have the duty to secure provision. For example, it could be used if necessary to maintain a consistent national level of primary medical services that must be provided across all PCTs. Only a few minutes ago, in answer to the noble Lord, Lord Clement-Jones, the Minister said that it is essential that we allow as much flexibility as possible. I do not see how those two statements fit together.
Moving on to Clause 171, on general medical services contracts, we find that subsection (1) inserts six new sections into the 1977 Act providing for the new GMS contracts that replace the current arrangements under Part II of that Act. The point that concerns me is the first provision, new Section 28Q, which gives power for PCTs and LHBs to enter into GMS contracts. A GMS contract is a contract for primary medical services, but it may also include services—this is the point I think made by the noble Lord, Lord Clement-Jones—that are not primary medical services, for example, in heart services that are on the boundaries of primary and secondary care, such as certain more specialised services in areas such as drug and alcohol misuse, sexual health or depression and so on.
Therefore, I am, as I said, somewhat confused. Is the Minister thinking of professions supplementary to medicine as well or, in part, instead? Will we know before the regulations come to be laid, which is the point of Amendments Nos. 445 and 447? If we are not to know in good time, then I propose that we make the regulations affirmative. I beg to move.
Lord Warner: In general terms, we believe that custom and practice will be sufficient to determine the scope of primary medical services. We do not believe that it is wise or helpful for service development to develop a fixed legal definition that could ossify service

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provision and militate against achieving better integration between primary and acute sectors.
Primary care is a developing field. In recent years we have seen the development of walk-in centres, diagnostic and treatment centres and an increase in the number of GPs with special interests. Medical knowledge is increasing and there is a shift of care from hospitals to the community. It would be impossible to keep an up-to-date definition of primary medical services. So we envisage that the power will be used, for example, only where it is felt necessary to ensure that a particular service is considered within the scope of primary medical services in the event of doubt.
The Lords Select Committee on Delegated Powers and Regulatory Reform has considered the powers carefully. It did not consider it appropriate that they should be made subject to affirmative procedure. The powers are in keeping with existing equivalent powers and the level of scrutiny is appropriate. I see no reason to disagree with its judgment on this issue. We do not support these amendments.
Lord Skelmersdale: Well, my Lords, surprise, surprise. The Minister again has not really answered my point, which was whether we will know exactly what is intended in sufficient time so that we can consider it. If not, that is a very good reason for affirmative regulations rather than negative regulations. I shall read what the Minister said to me in conjunction with what he said to the noble Lord, Lord Clement-Jones. It is to be hoped that I shall make sense of it and that I shall not have to return to this matter on Report. At the moment, I very much doubt it. I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 170 agreed to.
4.30 a.m.
Clause 171 [General medical services contracts]:
Baroness Noakes Baroness Noakes moved Amendment No. 446:
Page 87, line 37, at end insert—
"( ) Regulations under subsection (1) shall reflect the principle of patient choice."
The noble Baroness said: In moving Amendment No. 446, I shall speak also to Amendments Nos. 451, 452 and 453 in this group, which are about the impact of the patient's perspective on GMS contracts. Amendment No. 446 adds a new subsection to Section 28R of the NHS Act 1977, as inserted by Clause 171 of the Bill. The new subsection states that regulations under Section 28R—about the services to be provided under general medical services contracts—must reflect the principle of patient choice.
As Members of the Committee will know, patient choice has been the cornerstone of our policies for the NHS for many years. We have been pleased to see the gradual conversion to choice within the Government. We were particularly pleased that the Explanatory Notes at paragraph 358 state that patient choice should be reflected in the GMS contract.
The amendment goes further than paragraph (d) subsection (2) of Section 28U because that refers to the rights of patients to choose from whom they are to receive services. That is welcome, but patient choice is about more than just "from whom", it is also about "when", "what" and "how".
While we welcome the acknowledgement in paragraph 358 of the Explanatory Notes that patient choice is important, we do not understand why that choice is confined to the management of patients who recover from illnesses. Paragraph 358 draws a distinction between those patients and patients who are terminally or chronically ill. Apparently, patient choice is not relevant to those patients. That distinction does not appear to be made by the limited paragraph (d) of Section 28U(2), to which I referred a moment ago. Will the Minister confirm that patient choice will be available to the terminally ill or to those suffering from a chronic disease?
Amendments Nos. 451, 452 and 453 are about the important issue of doctors' rights to accept or reject patients. They all amend subsection (3) of Section 28U of the 1977 Act, inserted by Clause 171. Amendment No. 451 has the effect that regulations under Section 28U must deal with the issues of doctors accepting or rejecting patients. The amendment has the effect that the regulations must not only deal with the circumstances, but also deal with the manner in which doctors may act. Amendment No. 452 states that the regulations must cover when a doctor may terminate his responsibility for a patient, but also when he may not.
We fully recognise that there will be circumstances when a doctor must have the right to remove a patient from a list. Violence is the most obvious example, even though here there are difficult issues—for example, in relation to the family of a violent patient. There is much evidence that there are significant concerns about how removal from a list operates in practice. The National Association of Citizens Advice Bureaux says that it regularly receives reports that clients have been struck off lists without a reason being given. It says that these are often patients with serious long-term medical conditions.
I have recently received a worrying letter from a patient with motor neurone disease, with a wife with her own health problems, because they were both removed summarily from the list of their GP and no other local GPs will accept them. The message is that difficult and long-term conditions are not what GPs want on their lists.
I am aware that there is guidance from the Royal College of General Practitioners that a person's condition should not justify removal and that patients should be given a reason. But the complaints go on. So much hope is pinned on the regulations under the Bill. I understand that it is intended that transparent processes will be involved. Will the Minister say what those will be?
I hope that the Minister will also say something about the regulations under this section? When will they be available in draft? The National Association of

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Citizens Advice Bureaux is particularly concerned that new regulations will be drawn up without reference to the groups representing patient interests. Will the Minister say what consultation arrangements will be made? I beg to move.
Lord Clement-Jones: I rise to speak to Amendments Nos. 450 and 454. The tenor of both amendments is very similar and straightforward: they seek to improve the provisions of the Bill in dealing with disputes over matters such as a GP declining to take on a person as a patient or terminating responsibility for him. I have attempted to ensure that there would be a proper system for the adjudication of such disputes. Amendment No. 454 is rather fuller than Amendment No. 450, but essentially it seeks the same end. There should be an appeal and adjudication procedure so that it would not be possible simply for a patient to be struck off a GP's list; rather, there would be a proper process to go through.
We have seen enough cases involving rather arbitrary decisions about patients on GP lists to know that it is vital to put in place this kind of system. I look forward to the Minister's assurance that some kind of procedure is to be introduced.
Lord Warner: These amendments deal with some extremely important issues around patient registration and choice. Amendment No. 446 would ensure that regulations prescribing essential services would include a reference to the principle of patient choice. On a technicality, I am not entirely sure what the noble Baroness intended by inserting the amendment into new Section 28R rather than Section 28U. On a second technicality, I am not sure that it makes sense to single out choice as the sole condition on the face of the Bill. In delivering services a range of other factors are extremely important, such as the quality of clinical care provided, clinical governance and so forth.
However, on the issue of principle raised by the amendment, I can confirm that the Government are fully in support of delivering better choice in primary care. That is precisely why we are engaged in a major consultation exercise, focusing on offering choice to patients and users of health and social care services, including decisions about "where" and "when" care is received, as well as "what" and "how" someone wishes to be treated and manage their condition. Task groups were formed to look at eight specific areas or themes, one of which is primary care, being chaired by Delyth Morgan.
I can assure the noble Baroness that patient choice will be equally available to all types of patient. That is also why the new contract supports better choice in a number of ways that, given the hour, I shall not elaborate on.
Amendment No. 452 would require regulations to specify the manner in which patients are accepted on to, refused acceptance on to, or removed from a list. We intend that the regulations will make clear a responsibility not to discriminate against patients in the process of registering or deregistering them. And
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they will require that a reason is given in writing as to why patients are removed by practices from the practice list. Introducing a requirement that sets out the manner in which these processes work is at this stage overly bureaucratic and prescriptive.
Amendment No. 453 would introduce a requirement for practices to keep patients on their lists. The relationship between the patient and the practice is close and personal. If that relationship breaks down on either side, in our experience the breakdown is usually irreconcilable. We do not believe it is wise to introduce a requirement that practices may not deregister patients, nor is it a balanced one given that patients can choose to register elsewhere. The critical issue is whether, in doing so, they are acting reasonably, and this will be addressed by the requirement to set out reasons for deregistration, and not to discriminate on a range of grounds such as race or age.
These arguments apply equally in relation to Amendment No. 450 and the second part of Amendment No. 454, while an appeals process would add further bureaucracy. If patients are unhappy with the way they have been treated, be that in relation to non-acceptance or removal, they should raise their concerns with the primary care trust. This is the case now and should continue to be the case in the future.
It is important to note that when patients are removed from lists they are still entitled to register with a practice, even in the rare case of all practice lists being closed. It will be a requirement for PCTs to ensure that this happens and they have the power to do so, either by provision of services by the PCT or by allocating patients subject to the new process which involves a patient representative.
Amendment No. 451 proposes changing "may" to "must". The Delegated Powers and Regulatory Reform Committee did not make a recommendation on this issue but brought it to the attention of the House and, indeed, to my attention. The Government are committed to making these regulations as part of the implementation of the new GMS contract. I will be bringing forward a government amendment on this section on Report and, as part of that, will be including the change proposed in Amendment No. 451.
Finally, on the first part of Amendment No. 454, which would require regulations to be made to give reasons for patients being refused inclusion on a list, I am sympathetic. This must be right in principle. It is inconsistent to have a requirement to give reasons at the end of the process for deregistration but not at the beginning for refusing to register someone in the event that the practice list is open. Clearly if the practice list is closed due to capacity constraints, that is the reason.
The most appropriate route for progressing this would be the contract regulations rather than the face

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of the Bill. The department is in discussions with the BMA about the policy underlying those regulations and I can confirm that I will be in a position to set out the outcome of those discussions on Report. The noble Lord may wish to withdraw the amendment in the light of this assurance.
Lord Clement-Jones: I shall digest what the Minister said about the appeal procedure. I am heartened by what he said about giving reasons and the discussions taking place with the BMA. I seek his assurance that organisations representing patients' interests will also be consulted in that process. As I understand it, there has been no discussion with them to date in this area and it would be valuable.
Lord Warner: I take the noble Lord's point.
Baroness Noakes: I asked about consultation on the provisions in the regulations for changing doctors. I said that the National Association of Citizens Advice Bureaux is particularly keen that patients' groups should be involved in drawing up the regulations. Can the Minister say something about that?
Lord Warner: There will be consultation on the regulations.
Baroness Noakes: I am grateful to the Minister for that. As 1 said, it is regarded as important by patients' groups. 1 thank the Minister for the assurances he gave. I look forward to the amendment he will bring forward on Report and I shall read carefully what he has said. I believe he has answered many, if not all, of my points but, in view of the time, I beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 447 not moved.]
Lord Warner Lord Warner moved Amendments Nos. 447A to 447C:
Page 88. line 15, leave out "or a section 17C employee" and insert ", section 17C employee or Article 15B employee"
Page 88, line 18, leave out from "individual" to end of line 23 and insert "falling within section 28D(l)(bc) above"
Page 88, line 36, leave out "and "section 17C employee"" and insert ", "section 17C employee" and "Article 15B employee""
On Question, amendments agreed to.
Earl Howe Earl Howe moved Amendment No. 448:
Page 88, line 44, leave out from beginning to end of line 14 on page 89.
The noble Earl said: Proposed new Section 28T sets out the provisions governing payments under the GMS contract. I have tabled this probing amendment to find out what is meant by subsection (3)(a), (b) and (d) in particular. Paragraph (a) appears to cover targets and paragraph (b) schemes and scales of payment that are unspecified. It would be helpful to hear what these may comprise.
A great deal of money for the GMS contract is targeted towards quality and outcomes. How are the targets to be set, what will they be and who will police them? The Minister will by now realise that I am suspicious of targets because, unless they are clinically based, they are likely to lead to skewed priorities which may not necessarily be in the interests of patients. I make an exception for public health targets such as vaccinations, but if the targets are not public health-related, my suspicions return.
Paragraph (d) covers conditions. The only example of such a condition given in the Explanatory Notes is payments for seniority, which seems a very odd basis on which to make payments as it has nothing to do with either competence or quality of outcomes. It would be helpful if the Minister could explain the implications and meaning of these proposals in a little more detail. I beg to move.
Baroness Barker: I shall speak briefly to Amendment No. 449, which echoes the words of the noble Earl, Lord Howe. We, too, feel great disquiet that a target system is based on treatments or proportions of treatments that are delivered rather than health outcomes. We think that could cause quite severe difficulties not only for medical practice but for the nature of the doctor-client relationship.
The BMA is concerned that if exceptional reporting systems are not in place for all target payments, there could be a skew. As the noble Earl, Lord Howe, said, the GMS contract contains several pages detailing the making and achievement of payments. There is a very complex points system under which GP practices are to be rewarded, precisely to improve the numbers of treatments given. We do not see that that can be justified by itself in clinical outcomes. If a patient chooses not to have vaccinations or immunisations, what does that do to the GP practice in question?
Lord Warner: Perhaps I could deal first with Amendment No. 448. The power in proposed Section 28T is needed to implement the national agreement that was reached between the NHS Confederation and the GPC. Subsection (3) sets out how the power to make directions may be exercised. It makes it clear that payments may be determined by reference, for example, to the meeting of standards. In this way, it provides for the quality and outcomes framework. This framework represents, for the first time, that the NHS will significantly reward general practices for the quality of care delivered to patients. It recognises and rewards their clinical professionalism, not just the number of patients on their list.
It is not a series of targets for GPs. The contract does not include a required level of achievement. The framework is voluntary—it is based on best academic evidence. It was proposed by the BMA, which negotiated and agreed it with NHS employers.

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Subsection (3) also allows for directions to be made that take effect from a date earlier than the direction where this would overall be favourable to the contractor. This may be used, for example, where negotiations to review payments conclude that new or revised payments should be backdated to the beginning of a year. This has been essential in the past and the power will doubtless be used again. Sometimes these payments are about new services that will deliver benefits to patients, such as vaccinations. I do not think that patients or the profession would wish to see that power amended.
On Amendment No. 449, I have to say that the United Kingdom has one of the most successful vaccine programmes in the world, with high levels of uptake. This has been achieved by the hard work of GPs and enforced by a system of targeted financial incentives. This is for the good of the public's health.
The target payments scheme incentivised levels of uptake; it protects children not only individually but collectively in the wider community, especially those for whom immunisation is contra-indicated. Removing the target payments would have an unpredictable effect on vaccine uptake levels, but it is more likely to be adverse than advantageous to the public health. It could well perpetuate coverage that is insufficient for the protection of the wider community.
The new contract makes it clear that we will be discussing with the BMA how we can use the target payments more effectively in a way that meets general practitioners' concerns and encourages even higher uptake levels, protecting children from potentially life-threatening diseases. It is also worth noting that the BMA negotiated and agreed the directed enhanced service specification for childhood vaccinations in the contract. That includes the existing target payments. Aside from a potentially adverse effect on public health, the amendment would cut across part of the deal that GPs voted on and undermine our ability to deliver the contract agreement.
Earl Howe: I am grateful to the Minister for his full reply. He once again shed light on the clause, as I hoped that he would. I shall study his remarks and beg leave to withdraw the amendment.
Amendment, by leave, withdrawn.
[Amendment No. 449 not moved.]
Lord Warner Lord Warner moved Amendment No. 449A:
Page 89, line 30, at end insert—
"28TA GMS CONTRACTS: PRESCRIPTION OF DRUGS ETC

(1) A general medical services contract must contain provision
requiring the contractor or contractors to comply with any
directions given by the appropriate authority for the purposes of
this section as to the drugs, medicines or other substances which
may or may not be ordered for patients in the provision of medical
services under the contract.

(2) A direction under this section must, subject to subsection
(3), be given by regulations.

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(3) A direction under this section may be given by an
instrument in writing where it gives effect to a request made in
writing to the authority making the direction by a person who is
a holder of a Community marketing authorization or United
Kingdom marketing authorisation in respect of the drug, medicine
or other substance to which the request relates.

(4) A direction under this section given by an instrument in
writing may be varied or revoked by a further direction under this
section (whether given by an instrument in writing or by
regulations).

(5) In this section—

"appropriate authority" has the same meaning as in section 28T above;

"Community marketing authorization" and "United Kingdom marketing authorisation" have the meanings given by regulation 1 of the Medicines for Human Use (Marketing Authorisations Etc.) Regulations 1994 (S.I. 1994/3144)."

The noble Lord said: Government Amendments Nos. 449A, 457B and 464ZF are made in response to the Delegated Powers Committee report. They make it clear that directions in respect of the drugs, medicines, and other substances that may or may not be ordered for patients will be made by regulations, except where there is a request from a holder of an EU or UK marketing authorisation and the directions give effect to that request. In that case, directions may be given in an instrument in writing.
Any decision to restrict the availability of the medicines on GP prescription is taken only following a period of public consultation. We consult the manufacturer. Additionally, we consult professional representatives, patient representatives and other organisations with an interest to take into account as wide a range of views as possible. We do not intend to alter the arrangements. The consultation document would explain the rationale behind each proposal, including the available evidence on clinical and cost-effectiveness, if appropriate.
The relevant EU legislation is the so-called transparency directive, which obliges the Secretary of State to give a statement of the reasons for introducing a restriction based on objective and verifiable criteria. In addition, if there are expert opinions on which the decision is based they should be sent along with the decision. Those procedures safeguard the interests of patients and manufacturers.
I trust that these amendments and clarifications satisfy the concerns that have been expressed. I beg to move.
Lord Clement-Jones: In view of the hour, I do not propose to speak at length on Amendment No. 457A, which was tabled in my name. Suffice it to say that there are very good arguments against the selected list today, versus the time when the selected list was introduced under the 1977 Act. I intend to return to those arguments at a later stage.
Earl Howe: I thank the Minister for responding positively to the recommendations made by the Delegated Powers Committee on the issue of non-prescribable drugs and the regulatory procedure that

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should govern them. Amendment No. 459 was designed to flag up the issue, and I have no objection to what the Government are now proposing.
On Question, amendment agreed to.
[Amendments Nos. 450 to 455 not moved.]
Lord Grocott: I beg to move that the House do now resume.
Moved accordingly, and, on Question, Motion agreed to.
House resumed.
House adjourned at six minutes before five o'clock.