Clause 14 - Authorised services
Health and Social Care (Community Health and Standards) Bill
11:00 am
Mr John Hutton (Minister of State, Department of Health; Barrow and Furness, Labour)
That brings us to amendments Nos. 414 and 415, which were tabled by the hon. Member for Cheadle (Mrs. Calton). We have a simple choice in this part of the Bill between the list-based approach—under which particular activities are identified as being in or outside the cap—and the approach that we have taken, which is to create a general capping power in relation to income that is derived from the treatment of private patients, and to give the regulator the job of deciding, on a case-by-case basis where necessary, whether the activity comes within the cap or not. Generally, my experience as a Minister of trying to legislate is that it is better to do so in the latter way, rather than the former.
Sadly, the hon. Member for South-West Devon (Mr. Streeter) is not with us, but he always refers to the litigious lawyer. That is probably a bit of an oxymoron, but the point is that a list-based approach, whereby things are identified in a schedule or whatever, tends to light the blue touch paper for the worst-case scenario, which we want to avoid, of endless arguments about whether something is in the list. There is a difficulty, and I accept that there is no easy way to resolve these issues in drafting legislation, but the proposal would take us in the wrong direction, because it would be bound to provoke more argument than the approach that we have taken.
I assume that amendments Nos. 414 and 415 are intended to ensure that foundation trust income from private patient activity that is carried out by a subsidiary or joint venture is captured by the private patient cap. I certainly sympathise with the spirit of the amendments and I can understand that the hon. Member for Cheadle wants to ensure that there are no loopholes in the legislation that allow NHS foundation trusts to circumvent the private patient cap. I, too, believe that the cap should not be circumvented, but the amendments are unnecessary. The intention of the legislation is clear on this point. Clause 15(2) refers simply to NHS foundation trust income ''derived''—that is the crucial word—''from private charges''. It does not specify whether the activity is carried out by the NHS foundation trust or another body, such as a subsidiary.
We shall come later to the power in clause 17(5) for NHS foundation trusts to set up subsidiaries or engage in joint ventures, which clearly relates to the power to
invest. An investment is, of course, undertaken with a view to making a monetary return. Any such return from investments will be counted in the total income of the trust. It will therefore be included, I believe, in the private patient cap as defined in clause 15(2). Therefore, NHS foundation trust income from private patient activity in relation to joint ventures and subsidiaries is, I believe, already covered by the cap.
It would be reasonable to expect the regulator also to impose restrictions on the leasing of facilities to other organisations for the provision of services to private patients under the terms of the authorisation. That would be consistent with the spirit of clause 15, but he would also have to ensure that NHS foundation trust activities and income were consistent with their primary purpose of providing NHS services. The NHS foundation trust could not act in a way that undermined its ability to provide NHS services, for example, by leasing facilities to a private provider if that resulted in competition for a limited pool of local staff. That would not be acceptable. For the same reasons that I gave in relation to income from joint ventures and subsidiaries, the issue that the hon. Lady raises in amendment No. 415 would equally be covered.