Report (5th Day)

Part of Health and Social Care Bill – in the House of Lords at 9:00 pm on 6th March 2012.

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Photo of Earl Howe Earl Howe The Parliamentary Under-Secretary of State for Health 9:00 pm, 6th March 2012

As I hope will be clear, the Government's proposals are for a fair, transparent and comprehensive framework that protects patients and taxpayers' interests by securing continued access to services through early intervention to prevent failure wherever possible and effective arrangements to secure continuity of NHS services should a provider become unsustainable.

The Bill builds on and improves existing arrangements by putting commissioners in the lead for shaping services for patients and providing a clear role for Monitor in supporting commissioners. It will ensure that change happens when the status quo is unsustainable, and there will be sufficient funding to support this. The Bill goes further and addresses the gaps in existing legislation, such the lack of protections for patients whose NHS core is delivered by social enterprises and other independent providers. The Bill gives Monitor a comprehensive range of powers to intervene proactively to support reorganisation and prevent failure to maintain service continuity.

I turn to Amendments 196ZA and 214G. I am grateful to the noble Lord, Lord Warner, for his patience in working with the Government on this issue. I see that the noble Lord, albeit with a tiny bit of help, has really got to the core of our proposals for ensuring the continuity of services for patients by clarifying a role for Monitor, which is to support commissioners and provide them with information that they need to take the right decisions about services in the best interests of patients. The key aspect of the noble Lord's amendments is that they reinforce the fact that commissioners remain in the lead for responding to risks to services and, in partnership with providers and other local stakeholders, for engaging on service change to reduce those risks. That is why I am pleased to accept these amendments, which also reflect the King's Fund recommendation on how the Bill could be improved to support vital service reconfiguration.

However, it is not always possible or desirable to prevent provider failure at all costs. As a last resort, when a provider becomes unsustainable-and I emphasise that that will be only when all other interventions have been exhausted or may not be in patients' best interests-a continuity of services administrator may be appointed to protect patients' interests and secure NHS services in line with requirements determined by commissioners. For the first time, there will be similar protection for patients who rely on essential NHS services regardless of who the provider might be. The existing legal framework has no such protection for patients who rely on NHS services provided by independent providers, including the social enterprises established by the previous Government when the noble Baroness, Lady Thornton, was Health Minister. I am sure noble Lords would agree that if a social enterprise delivering essential community palliative care became unsustainable, then surely its patients should receive protections that would secure the continuity of that service, as do patients of the foundation trust.

The reality of the NHS is that it is a comprehensive health service delivered by a diverse range of providers. Part 3 recognises that reality and will protect patients' access to that comprehensive service. I cannot agree with the noble Lord, Lord Beecham, as his amendments would remove this type of protection for patients. Fundamental to our aim of protecting patients' access to a comprehensive health service is the need to ensure that sufficient funding is set aside for when things go wrong. The King's Fund and others have said that they support the establishment of a transparent funding mechanism for securing essential services when providers go into administration. When the noble Baroness was a Health Minister, her Government presided over a period of sustained growth in the economy, but sadly that is no longer the case. Despite economic challenges, the coalition has continued to increase NHS funding above the rate of inflation, but we need to be prudent to be able to guarantee that funding will be available to protect patients when any provider of essential services gets into difficulty. The problem with the noble Lord's amendment is that it would put that at risk.

That funding is essential because we simply cannot be sure otherwise that sufficient funding would be available centrally, particularly when the Treasury will face competing demands on any surplus funds held centrally by Whitehall departments. A further benefit of our approach is that the funding will be built up from commissioners and providers, including private providers, based on a transparent methodology and in proportion to risk. That will strengthen financial incentives for providers and commissioners to manage risks effectively and help to end the culture of back-room bailouts.

I hope that the arguments that I have put forward demonstrate how Part 3 will strengthen the protection of patients' interests. Once again, I thank the noble Lord, Lord Warner, for his amendments, which will improve the Bill and undoubtedly benefit patients. I hope that noble Lords will join me in my support for them, and I ask the noble Lord, Lord Beecham, to withdraw his amendment, as he has indicated he will.