We had an unexpectedly long debate on clause 2 on 27 November. As the hon. Member for West Chelmsford (Mr. Burns) said, the clause is an important part of the Bill. At times, the debate became acrimonious, which is regrettable. I am not sure why the hon. Member for North-East Hertfordshire (Mr. Heald) lost his usual equilibrium, but I hope that he recovered during the interregnum.
That is a good plea in mitigation, and I will give it due consideration when I come to apply my sentence.
The debate was important, because the establishment of primary care trusts is an important part of the Government's reform agenda for shifting the balance of power and devolving more responsibilities to the front line of the national health service.
The hon. Member for Oxford, West and Abingdon (Dr. Harris) is concerned about whether the Audit Commission will assess the savings that the Government believe will accrue to the NHS as a result of the proposed changes. He also wondered whether I would allow the Audit Commission to make such a study. As he probably knows, Ministers do not decide what the Audit Commission examines. It has been given responsibility to perform the value for money audit of the NHS and can look into whatever aspect it chooses. That is not a matter for me to decide, nor should it be. I have no doubt that it will fully discharge its responsibility.
I thank the Minister for clarifying that issue. Will he confirm that the Audit Commission has neither confirmed nor denied the Government's claims that they have made savings in NHS management costs, because it has not looked into them?
That is correct. The Audit Commission has not looked into the matter, as I said. We are confident that savings in the NHS will be made as a result of the proposed reforms. The money saved by the reforms will be reinvested in front-line health services, which is an important principle.
There was some discussion about whether the reforms have a different motive. The Government consider the reforms to be about empowering, and devolving power to, front-line health services. That is the most sensible way for any large organisation to conduct itself. Some Opposition Members attribute another motive to the reforms. The hon. Member for Oxford, West and Abingdon described that motive in a nutshell when he said that the reforms sought to shift blame, not redistribute the balance of power, in the NHS. The Liberal Democrats are making a false, but predictable, argument. They are the real conservatives on the subject of reform in the NHS: they oppose change, resist reforms that will empower the front line, and stick their heads firmly in the sand. We have always made it clear when we talk about the future of the NHS that there are two processes that need to go hand in hand. One is investment, and we are making sure that that the NHS has access to record amounts of new investment which will allow us to close the gap between public expectation and capacity in the NHS. That investment needs to go alongside reform; the money itself will not be sufficient. It is depressing that the Liberal Democrats, who would like to present themselves as a party with radical new ideas, are so deeply entrenched in their conservatism about the future of the NHS.
It is not my intention to return to matters that we have already discussed and the record will show that I did not repeat the extended allegations that I made on Second Reading because they were matters for Second Reading.
I accept that the Minister has a different view about these reforms, but does he accept the principle that in certain circumstances the NHS will be hampered by continual change. Does he accept that there is an argument that at some point change becomes the enemy of progress because it distracts people on the front line, of which he talks so fondly, from getting on with the job of treating patients?
Well of course any Government have to make judgments on such matters. What I am saying to the hon. Gentleman is that his solution of no change is simply not compatible with the reality facing the NHS at the moment. That is why I say to him, the Committee and my hon. Friends that these reforms are essential if the extra investment is to work in the way that we envisage it working for the NHS.
The other point that emerged during our debate on clause 2 concerned the nature of the clause. There was a lot of rhetoric from the Opposition about imposing obligations to establish PCTs, and so on. We need to consider the issue in a more accurate way than we managed on Tuesday when Opposition Members were speaking about it.
One thing that Opposition Members have lost sight of in their concerns about clause 2 is that in the earlier debate on Tuesday I made it clear that by October 2002 we will have 100 per cent. coverage in England of PCTs. We will be practically there in April. Only a dozen or so primary care groups will not be constituted as trusts by that date.
What Opposition Members completely failed to pick up on was that that will be done under the existing voluntary provisions in the Health Act 1999. Throughout the debate on Tuesday it was suggested that we were using some power of compulsion to compel people to create PCTs. We have no such powers of legal compulsion at all. The process of moving from PCGs to PCTs is under way, and people will be aware of that in their own constituencies. Many hon. Members will be involved in the consultation process. But that process of moving from PCGs to PCTs is obviously being conducted outwith clause 2, because clause 2 is just that—a clause of a Bill that is not yet law. The argument that we were using some power of compulsion that we had said we would not use to establishment PCTs is simply not true.
No, let me finish my argument.
The other point that needs to be clarified, which, unfortunately, I do not think was on Tuesday, is that it remains unclear to me whether Conservative Members support a shift in the balance of power; whether they believe that that is the right thing to do in relation to reforms in the NHS. I can quite understand their concerns about the speed with which the changes are being made, but on Tuesday I detected a more fundamental objection to the reforms themselves.
I hope that Conservative Members at least—Liberal Democrats will not because they are opposed to these reforms—understand that clause 2 is important because it will ensure that devolution to the front line becomes a reality. Without there being a statutory duty to ensure 100 per cent. coverage of PCTs, the new architecture of the NHS simply cannot be delivered.
It is true that, under the Health Act, the Secretary of State is not under a duty in law to establish PCTs. The Bill does impose such a duty, and necessarily so if shifting the balance of power is to work. My point was not so much a technical or legal one; it is a broader issue. The move to establish PCTs is not being done under any power of legal compulsion because the Secretary of State does not have that power of compulsion in primary legislation. He has an opportunity but not a duty to establish PCTs.
Does the Minister accept that if one says that someone has an option to do something and then says that if that option is not taken up it will happen anyway, that puts pressure on the person to take the optional route and they may as well prepare for the inevitable? An analogy, in terms of patient consent, is that consent is not valid if what is consented to will happen anyway.
The concept of PCTs commands broad support in the NHS. I am not saying that everyone in the NHS supports the establishment of PCTs, they clearly do not—one hon. Member here does not—but there is a strong consensus in the NHS that this is the right way forward.
The argument on Tuesday was more about the speed of change. If one accepts the principle of devolution to the front line and the new role of PCTs, logically one must support clause 2. The argument about pace of change is a completely different from the fundamental argument about whether there should be PCTs in the NHS. That is a fundamental part of the shifting of the balance of power package. Without the duty to ensure that there is 100 per cent. PCT coverage there would be a hole at the centre.
It may be that I am not following the Minister's argument, in which case I apologise. We have always agreed that it is a good idea to develop PCTs in an evolutionary way and that they can form a good basis for the future. What we are objecting to is the fact that the Secretary of State will now be able, under clause 2, to establish PCTs without the sort of safeguards that Ministers had previously promised—that is, that they would emerge in an evolutionary way.
I take issue with the hon. Gentleman because the safeguards will remain in place if clause 2 becomes law. The essential safeguard is consultation around any proposals to change PCTs, and that will be part of the new legislation. I can quite understand why the hon. Gentleman worked himself up into a lather on Tuesday. It is the responsibility of Opposition Front-Bench spokesmen to do that on occasions. I do not begrudge him that opportunity. He probably felt better for having done so. I am taking issue with the hon. Gentleman and his hon. Friends on their analysis of clause 2.
Throughout the debate on Tuesday, the impression was created by Opposition Members—I have read their remarks carefully—that we would be using powers that we would not have and would not take to compel the establishment of PCTs. That is not true. The hon. Gentleman supports the evolutionary progress of PCTs, and that is happening. The process to 100 per cent. PCT coverage, which will be established by October 2002, is an evolutionary process and has not been driven by any legal powers of compulsion because none will exist.
The hon. Gentleman says that consultation is the great protection. Community health councils are one of the statutory consultees. When they are abolished, what will replace that duty of consultation? Who will the consultation be with?
That is already in the legislation: the hon. Gentleman should read it. The CHC role is being replaced. The consultation duties are clear. The consultative role will be changed owing to the abolition of CHCs. The right to object to service reconfiguration—including PCTs—will transfer to local authorities, which have a democratic legitimacy that the CHCs never had. The hon. Gentleman's argument that we are loosening safeguards is without substance. I am sorry that I caused the hon. Gentleman confusion, but the clause does not compel PCGs to become PCTs. How can a clause impose compulsion on PCGs? It cannot.
This is hardly a new constitutional principle. When the Bill becomes law, the Secretary of State will have a duty to establish PCTs, which are necessary to ensure devolution. Conservative Members spent Tuesday evening discussing the current process. The hon. Gentleman and the hon. Member for North-East Hertfordshire said that the existing evolutionary process was driven by some legal power of compulsion.
They should both read their speeches because they made that point on Tuesday and they were absolutely—
I have certainly heard the hon. Gentleman, but that does not change the fundamentals of Tuesday's debate. In breach of an earlier pledge to my right hon. Friend the Member for Southampton, Itchen (Mr. Denham), the hon. Gentleman and other Conservative Members consistently described the process as driven by compulsion. The current process is not driven by compulsion; it is evolutionary and will result in 100 per cent. coverage by October 2002.
Ministers have to make a judgment on PCT applications. I do not dispute the obvious point that when the Bill becomes law, the Secretary of State will have a legal duty to require establishment. That is vital. The hon. Gentleman rails against that, but on Tuesday evening, he did not say whether he thought that compulsion was necessary to ensure delivery of the devolutionary proposals.
The hon. Members for Wyre Forest (Dr. Taylor) and for Oxford, West and Abingdon made good points about that. They described the possibility of a vacuum developing between the establishment of SHAs and PCTs. In that case, SHAs would exist everywhere in the country but not PCTs. That will not happen. We will not activate these proposals. We could not as it would not be logical if there were to be such a vacuum because the whole structure would be incomplete. The structure needs to be complete before the proposals can be fully implemented. As I have said on many occasions in Committee, that will happen by October 2002. That is when all the PCTs will be established and so the vacuum that rightly concerned the hon. Gentlemen will not happen.
I accept that I may not have followed this, so I should be grateful if the Minister could be gentle with me if I have missed something. Is he implying that if PCTs do not have full coverage by October 2002, health authorities will not be abolished? Is that throughout the country or just in the relevant areas? If so, has that been announced previously?
No. We will undertake the reform in a sensible way so that it will happen throughout the country at the same time. That is what we have always said we would do and that is what we are currently planning to do from October 2002.
Some concern was expressed about the state of readiness for PCTs. I understand those arguments and they were well put. However, when hon. Members drew attention to the survey they did not point out that the comments were more than a year old. If we had taken no action to address concerns that had been expressed to us about the management capacity and capability of primary care groups as they move to PCT status, that would have been a perfectly valid criticism to raise today. But I referred earlier to measures that we have put in place to enhance and support managers working in PCTs. A national care programme of management support is now available to help PCTs and to help PCGs as they move to become PCTs. We also have a new national leadership centre in the NHS, which is helping managers to prepare for their new responsibilities.
There was a lot of concern about the new commissioning expertise of the PCTs and whether they would find that difficult to absorb as they move up from PCG status, and it was felt that somehow the NHS would lose the commissioning expertise that exists in health authorities. It is clear that as we move to the new model, we will not lose the commissioning expertise in the NHS. Many of the commissioning managers who are currently working in health authorities will want to work in PCTs too. There is strong case to be made for ensuring that we do not lose their commissioning expertise. The Government are committed to ensuring that, in line with the other changes that we are making to support and enhance the role of PCTs. Some of the criticisms that were aired on Tuesday need to be seen in that new and different light.
Does my right hon. Friend agree that the Conservative Front-Bench spokesmen seem constantly to be contradicting themselves? On Tuesday afternoon, the hon. Member for North-East Hertfordshire (Mr. Heald) said that Labour's
``reorganisation is stupid, pointless, ill thought out, a waste of time, ludicrous and rushed through in the face of the objections of the BMA and the RCN.''—[Official Report, Standing Committee A, 27 November 2001; c. 87.]
This morning he has gone on at length about how he supports the principles of PCTs. Is my right hon. Friend as confused as I am?
It is not. What was a pointless exercise was much of the froth that we heard from the hon. Gentleman on Tuesday. He was clearly annoyed because his amendments were not selected because they were starred amendments and he felt sufficiently motivated to indulge in a bit of ranting about this without any notes or thought about the previous positions that his party had adopted. My hon. Friend is entirely right. On Tuesday Conservative Members contradicted their previous positions. That is why I wanted to open my remarks this morning by drawing the Committee's attention to that inconsistency.
Anyone can take one line out of context, but on Tuesday I made the point that I have made again this morning. I said:
``I have made it clear time and again that PCTs are a good basis on which to progress. PCTs are a good idea. This is an evolutionary process, but it is wrong to coerce PCGs in the way suggested by clause 2. I am also saying that the time scale is wrong.''—[Official Report, Standing Committee A, 27 November 2001; c. 88.]
The hon. Gentleman confirms the point that I was trying to make earlier, which is that he got it wrong on Tuesday. Clause 2 cannot be used to coerce PCGs, because that is not the law of this country. The hon. Gentleman is a lawyer, so he must know that no Government can use a clause in a Bill to coerce anyone to do anything. I do not need to labour the point.
No, I have addressed the issues and do not want to detain the Committee much longer.
One concern raised by Opposition Members relates to finance directors and their role in PCTs. There was a misunderstanding about the quotation that said that one in seven do not have a finance director. It is a legal requirement for PCTs to have a finance director, whereas it is not a legal requirement for PCGs to have one because they are simply constituted as committees of health authorities. The health authority must have a finance director in that capacity, as well as in relation to the PCG. Opposition Members' analysis was wrong.
This long debate has become rather sour. I may have contributed to that with my remarks this morning, but it was important both to place on record some of the misconceptions in which hon. Members indulged themselves on Tuesday and to set out the argument in the correct context. Until Tuesday, we understood that the Conservatives supported the concept of primary care trusts but had arguments to make about the pace of change, just as they supported the principle of devolution but were concerned about the rapid progress towards it. Those concerns should be left to one side because they are not related directly to clause 2.
The clause simply puts the structure that we are designing for the NHS on a proper legal footing. Without a duty on the Secretary of State to require the establishment of primary care trusts, there would be a hole at the centre of the new NHS architecture. If the Opposition support the principle of primary care trusts and want to ensure that they can deliver their new commissioning responsibilities, their argument against clause 2 is inconsistent. An argument about the pace of change is one thing, but it is irrelevant to the clause. For those reasons, I commend clause 2 to the Committee.
As the Minister says, we have had a long and comprehensive debate on the clause. I do not intend to detain the Committee for long, except to clear up some of the misapprehensions that the Minister tried to spread in his remarks today. I do not understand his Minister's motivation—it may simply be a misunderstanding. I shall make the matter plain, so that he comprehends fully and there is no future misapprehension.
As my hon. Friend the Member for North-East Hertfordshire made clear at column 88, we as a party do not oppose the principle of PCTs. Our argument throughout the debate on clause 2 has focused on what we believe is a hasty rush towards implementation of the reforms, which haste will impose considerable strains on the health service. The Minister went off at a tangent and suggested that we do not understand that the Government currently have no statutory powers to force PCGs to become PCTs. That is self-evident; my hon. Friend and I have always understood that the Government have no such power. However, the purpose of clause 2 is to give them the power to ensure that there is 100 per cent. PCTs by the Minister's deadline of October 2002.
I intervene to confirm that the transition from PCG to PCT status will be conducted and completed under the existing evolutionary provisions of the Health Act 1999, not under any powers of compulsion.
My hon. Friend anticipates my argument. If he will forgive me, I shall finish putting my point to the Minister as he can clear up the matter once and for all. It is my understanding—of the Bill and the explanatory notes—that if in September next year a PCG is not evolving towards PCT status in time for October 2002, the clause gives the Government the power to force the PCG to become a PCT. Yes or no? Am I right or wrong?
As I have just said, the process will be completed by October 2002 and all the PCTs will be established under the evolutionary powers in the Health Act 1999.
It was a mistake to invite the Minister to intervene because, parrot-like, he has merely repeated what he has been saying for the past 20 minutes. He has not answered my question. In theory, a PCG might by September or October next year be nowhere near to becoming a PCT—for some quirky reason, it might not want to become one. In those circumstances, the Secretary of State will possess the clause 2 powers to make it become a PCT. That is my understanding of what might happen. The Minister says—events may prove him right in one respect—that although the Government will have that statutory power when the Bill becomes law, they will not need to use it because of the evolutionary process. My hon. Friend the Member for North-East Hertfordshire and I believe that the Government have sought powers under the clause to make PCGs become PCTs by 2002, and that they could use those powers to speed up the process if some PCGs were reluctant to acquire trust status.
Absolutely. If it is unnecessary, there is no reason for the Government to include the clause in the Bill. The Government insist on including it because they need the reserve powers in case the evolutionary process does not materialise 100 per cent.
Since the Government's intentions were made clear, pressure has been applied to PCGs to rush towards PCT status. That is the nub of our argument and our concern about the undue haste. Our amendments ask—interestingly, in the light of the Minister's timetable—for a delay of only six months, to give PCGs and the embryonic PCTs a little more power to bed in and lay the foundations for their substantially increased and novel functions. The right level of health care might then be provided without any hiccoughs or hiatus. That is eminently reasonable, so I invite my hon. Friends to join me in opposing the clause.
So that there can be no misreading as Ministers and civil servants trawl through the debate over the weekend, we oppose the clause not because we oppose PCTs in principle, but simply because of what we regard as the haste with which we have reached that stage of the reforms and the damage that that haste will cause to the provision of health care throughout the country.
I have some brief some points to put to the Minister. First, I reiterate our concern about changes to the NHS that we believe are part of a strategy to make activity appear the same as action, so making it easier for the Government to blame the continuing failings of the health service on anyone but themselves. They are creating reforms in the NHS that appear helpful but are nothing of the kind.
A briefing paper from the NHS Confederation mentions management costs. Nigel Edwards, its acting chief executive, says about stripping away tiers of management that
``Shifting the balance of power in the NHS''
—I assume that he is referring to the document—
``actually requires more organisations not fewer. This will bring decisions close to the patient but the consequence is we have gone from 95 NHS management bodies to 307 with this latest reorganisation of the NHS.''
The Government should accept as valid the fears that additional management and bureaucracy are being introduced and about the series of reorganisations. I am generally sceptical about such structural reforms when the urgent need is—as it was last year and four years ago—to give the NHS the resources it requires, not another reorganisation.
On the issue of compulsion, does the Minister accept the argument to which I alluded earlier, that if a person is given a clear option about whether to say yes or no to a proposition and he or she then says yes or no, and if that process is repeated with the threat that the person will have to accept the proposition in future, it is an invalid procedure in terms of the ethical gaining of consent? The choice is meaningless if the decision is to be compulsory anyway.
Will the Minister clarify his announcement today—and perhaps Tuesday, if one reads between the lines—that the go date for the changes is now October 2002 because he wants the process to occur simultaneously throughout the country? I understand why he wants to do that, but the necessity of getting PCTs across the country has put off the target date to a half-year point instead of his original target date of April 2002. Is it understood that people who seek new jobs will have to start them in October 2002 and not earlier?
We have always said that April 2002 relates to the creation of the new strategic health authority. We will use our powers to make sure that health authorities merge by April 2002, but they will not be able to take on responsibilities or the new title of strategic health authorities until and unless the Bill becomes law.
I am still unclear. Is the Minister saying that he wants to create some form of shadow strategic health authority, getting the boundaries sorted out by April 2002? The key question is when functions of health authorities transfer to PCTs. If the Minister is saying that that will now happen in October 2002—that may have always been his plan but I was under the impression that it was going to be April 2002—it means that the shadow strategic health authorities will indeed be strategic health authorities in terms of boundaries, but in terms of functions they will for at least half way into the new financial year behave as health authorities. In other words, they will continue to have all the powers—to be discussed under another clause—that will transfer to PCTs. Will the Minister help me out by providing clarification?
I have laid out the timetable many times. The hon. Gentleman's understanding of the timetable for establishing the health authorities is broadly correct. They will be established in shadow form using existing powers to merge health authorities to form larger groups; they will become authorities when the Bill becomes law. We are aiming for that to be done in 2002.
Is the Minister saying, in effect, that this section of the Act—as it will be, unless something dramatic happens during the parliamentary process—will come into force on October 2002, or that existing powers will be used to create the relevant geographical structures earlier than that?
I am not in a position to give a precise date for when the provisions will be brought into force, but I will state honestly and openly that that is the broad timetable within which we are working. However, the legal transfer to PCTs of responsibilities and a host of functions cannot take place—I will not rerun the argument that we just had about the nature of clause 2—until the Bill becomes law.
For the convenience of the Committee, I should announce that I have called a meeting of the Programming Sub-Committee for 11.35 this morning. It will be held in this Room after the Committee rises. Clause 7 Funding of strategic health authorities and health authorities