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Health Bill H L

Volume 597: debated on Thursday 25 February 1999

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3.39 p.m.

My Lords, I beg to move that the House do now resolve itself into Committee on this Bill.

Moved, That the House do now resolve itself into Committee.—( Baroness Hayman.)

On Question, Motion agreed to.

House in Committee accordingly.


Clause 1 [ Repeal of law about fund-holding practices]:

Page 1, line 10, at end insert ("from 31st March 2000").

The noble Earl said: At the start of our Committee proceedings, perhaps I may say that regardless of the profound difficulties which we on these Benches have with many parts of the Bill, I shall be guided in what I say both today and on Monday by two principles. The first is that where we oppose, we shall oppose in a constructive fashion. It is no part of our purpose to wreck the Bill, nor will we do so. We will, however, seek to press those issues where we believe we are right and where we believe we can create a better Bill to a Division where necessary. That approach is consistent with the functions and traditions of your Lordships' House and will, I hope, be understood and accepted by the Government.

The second principle to which we shall try to adhere is brevity. I humbly suggest to the Committee that with the sheer number of amendments ahead of us during the two days, we shall assist ourselves by being as concise and punchy as is called for by the amendment we happen to be debating. I hope that other Members of the Committee will share that view.

Unfortunately, I cannot be as brief as I would wish with the first amendment, although I shall try. Its purpose is to defer by 12 months the date on which fundholding formally comes to an end. I propose it not in any kind of "die-in-the-ditch" spirit, nor in any way to frustrate the Government's intentions to establish primary care groups and primary care trusts, but to do precisely the opposite.

The Government have had over a year to prepare for the advent of primary care groups and in some areas the transition to PCGs is proceeding reasonably satisfactorily. But that is not the case in a great many other areas. There is an enormous number of obstacles still faced by PCGs and board members in attempting to establish the new structures.

The work involved is considerable. To start with, there is wide dissatisfaction over the question of PCG boundaries and at the moment no mechanism to allow for independent review of health authority proposals. The amount of money made available for the development of PCGs has been woefully inadequate. Many GPs and others have had to give up substantial amounts of their own time, without remuneration, to organise meetings, to discuss the new arrangements with health authorities and to set up steering groups. With PCG boards, the guidance on election arrangements and payments to PCG board members has resulted in appointments being rushed and a woeful lack of information about the time commitment that a board member will need to devote to his or her responsibilities.

Even at this late stage, many PCGs are still in the throes of negotiating their management budgets. Without those budgets, they will not, of course, be able to decide on anything; not their management structures, nor their activities, nor the responsibilities that they wish the health authority to delegate to them. The key issue in many areas is that the per capita level of support is far too low.

There is terrible uncertainty as a result among fundholding staff about their future employment. Where staff have been made redundant, the redundancy payments are often being met out of the pockets of GPs who have had to face the whole messy business of redeployment and redundancy of practice staff with precious little information to assist them.

Local services are being terminated early. We have assurances that contracts for the delivery of specialised services such as chiropody, dietetics and physiotherapy, as well as consultant-led clinics in GP surgeries, would not have to be brought to an abrupt end as a result of PCGs. But that is exactly what is happening in some health authorities where the edict has gone out to terminate those contracts before 1st April.

Guidance is being issued late and piecemeal. Even the revised standing orders and financial instructions for health authorities have yet to be distributed. There is still no information about the IT structures and reporting requirements that PCGs will be expected to implement. Many PCGs have not even got premises from which to work.

The simple fact is that the whole exercise in what is a major change for the NHS has been rushed. At local level, the NHS is simply unable to cope with the timetable that has been thrust upon it by the Government. The result is that many GPs are still, to put it at its mildest, unenthusiastic about PCGs because they see an underdeveloped idea being forced upon them at too rapid a pace, with grossly inadequate financial and managerial support. There is demotivation. They see nothing ahead of them but extra workload. Some of the work will take them away from patient care, without providing their patients with replacement doctors. The doctors are being put in the firing line to take the flak from patients and the public when the NHS finds itself unable to deliver the necessary care because of the woeful degree of under-funding.

My point is therefore a straightforward one. ft is to say to the Government: "Stop rushing. Stop making life impossible for doctors and patients all around the country. There is still time, if you choose to take it, to ensure that this important transition is made smoothly and to everyone's satisfaction". For that reason and that reason alone, I beg to move.

I support my noble friend Lord Howe in his amendment. The PCGs will be much bigger units than anything equivalent which has been known before. They will be drawn from a diverse series of practices. The fundholders in the first wave are very different in character from many in the later waves of the practices. They will include many sole practitioners with little or no back-up. They will require a tremendous amount of training, to which my noble friend referred. The very size of the PCGs and their diverse nature throughout the country make it advisable that we delay this for a year, as my noble friend suggested.

I too support the amendment. The question of redundant staff is causing great anxiety to general practices which find that they have to dispense with their practice manager in order to go into the bigger unit where someone else will carry out the management. Funds do not seem to be available to meet the redundancies.

I too support my noble friend largely on the grounds that he has explained; namely, the problems faced by the participants in this enormous change. I was extremely grateful to the Minister for the meeting that she arranged with her team of civil servants who between them knew everything there was to know about the Bill. They were extremely helpful. The Minister even brought three civil servants down from the Scottish Office.

At that meeting I asked about the legality of the position given that arrangements both north and south of the Border were proceeding regardless of the fact that the Bill was only at the early stages of its passage through Parliament. We were told that much that was happening could be done without legislation, but that is not the answer. Not everything can be done without legislation.

This particular clause is essential to the Government's arrangements. It shows an extraordinary disregard for Parliament and is another example—we see more and more—of the Government being prepared to proceed with a scheme, an integral part of which is the abolition of fundholding, before they know whether or not the Bill will become law. For all we know, fundholding may be restored during the passage of the Bill. I understand why the Government are optimistic that it will not be, but they should not make that assumption. This is a very strange way in which to proceed. For that reason the amendment will increase the legality and credibility of the Government's actions and I hope that they will accept it.

I am somewhat surprised by the very muted way in which the noble Earl moved his amendment. It reminded me of his party's policy on the euro. It does not like it but it does not want to say that and it will do it some other day. It would be nice if he argued that we should keep fundholding. As the noble Baroness, Lady Carnegy, said, perhaps he should have argued for the retention of fundholding. It might have been fun.

I am grateful to the noble Lord for giving way. I remind him that it was a manifesto commitment of his party, and we do not wish to upset that.

That is very good to know. If it has been known for some time that the Labour Party will remove fundholding and consultative papers have been issued, those involved should have prepared for it. It has not happened suddenly. Intelligent people should be able to take account of forthcoming events and make allowances for them. This has been known about for some time. Either it has been known for some time that the Labour Party will do it, and therefore adequate notice has been given, or the noble Earl does not like what we are doing. Either way I do not believe that he has an argument.

Perhaps I may remind the noble Lord, Lord Desai, that running a rural practice in particular and a primary care group is not exactly the same as running a department of economics. At the moment the people on the ground who are involved in fundholding practices are being poached to set up primary care groups. Anecdotally, in one practice I know very well the person in charge of fundholding has been appointed chief executive or director—I forget the exact title—of the local primary care group. As a result there has been a problem back at the practice. She spends two days back at the practice and three days trying to set up the primary care group and is at her wits' end knowing that she is running out of time. We know that primary care groups are to be introduced and we accept that—at least I do—but I am sure that none of us in this Chamber wants the process to go off at half-cock so it is in a mess right from the start. Is it not better to ensure that the organisation, staffing levels and liaison with practices are correct before the scheme comes into being? For that reason and for many others I support my noble friend's amendment.

I ask my noble friend to reject this amendment. I believe that the noble Baroness, Lady O'Cathain, has just given my noble friend a very good reason for rejecting it. Her argument points to getting on with it rather than delaying it. PCGs are a very important part of the Bill. If we delay that, we would be delaying all aspects of the Bill. I advise my noble friend to reject the amendment and to get on with it.

Perhaps I have misled the noble Lord. It takes a lot longer than five weeks, or whatever the period is, to do it. I suggest that there should be a longer running-in period. We should not get on with it now when there is still a state of confusion and in effect people are doing two jobs.

We do not seek to delay. This is an important part of the Bill. Having listened to the argument and knowing a little about this, I believe that as laymen most people deal with the problems that have been spoken to during their lives. The noble Baroness, Lady Hayman, must be perfectly well aware of this, too. The point that has been put in so many ways is that this should not go off half-cocked. Why cannot this be dealt with? The case that has been put is genuine. To say that we seek to delay is a totally meretricious intervention. We do not seek to delay. We do not challenge the principle, but as a matter of common sense we want to try to make it work. The noble Baroness and the Secretary of State can deal with this matter in a perfectly sensible, proper way. Clause 52 states:

"(1) The preceding provisions of this Act are to come into force on such day as the Secretary of State may by order appoint.
(2) Different days may be appointed under this section for different purposes".
Cannot the noble Baroness give the Committee an assurance that the Secretary of State will look at this with an open mind and not commit himself in advance to bringing in these provisions before it is right, proper and reasonable to do so? That is all I ask. Amendments to Clause 52 have been tabled but this is not one of them. I have only just thought of it while listening to the debate.

I support the amendment. Only a fortnight ago I spoke to my trust which told me of the difficulties that it was experiencing. Yes, it has known of this in advance and is working to try to get it to work, but the mere fact that it must be done in such a short time is causing no end of problems. I can assure the Committee that the pressures and the anxieties are very great.

As a matter of principle, I am intrigued to hear the case put by noble Lords opposite. This is one of the great breakthroughs as far as concerns the future of the health service. My experience is that, when you have made up your mind to do something that is both sensible and will help to solve problems, the best thing to do is to go ahead and do it. I am not quite clear how the running of an economics department comes into this. When I ran such a department I never encountered any problem. I simply decided what needed to be done and it was done. I entirely accept that this is more complicated than that. But the fact remains that many of us regard this as an important step forward. As I understand it, the noble Earl, Lord Howe, is at least willing to consider that this may be an important step forward and does not oppose it. It follows that the best course to take is to go ahead and do it. The notion that somehow one should not do anything until Parliament has passed the relevant Bill into law is an entirely new one to me. I have attended here only a dozen years, but it is the first time I have heard it enunciated that the provisions of a Bill should never start to come into practice until the legislation has become law because it would be an insult to Parliament.

I attended on the Benches opposite for a great many years. I often did not like what I heard. However, on the whole when governments said that they were going to do something, one generally took the view that they would do it and we should prepare for it to happen. I am at a loss to know where the doctrine comes from that it would be unfair and insulting to Parliament to ask people to act before the Bill became law.

I know how reasonable and moderate the Minister is. She will be listening carefully to all the amendments. However, on this occasion, despite her desire to be helpful, I would advise her not to accept the amendment.

4 p.m.

The noble Lord speaks from another dimension. He is an economics don. He can say, "This is this. Let's get on and do it". Whether or not it works does not really matter. I read economics some time ago. Economists get it wrong anyway. But the one thing about which they do not care is whether it will work in practice. It is theory.

We are concerned here with making the provision work. We are not in the dimensions of erudite economic theory. It is a practical problem. Delay it only to make it work.

Since we are in Committee, I am allowed to intervene. Logically I do not see how one discovers whether something works in practice until one puts it into practice. The position is the exact reverse of what the noble Lord said. It may well be theory now but it is very good theory.

What I hope the Government wish—it is certainly what I wish—is that we put the provision into practice and make it work. I have a higher opinion of the medical people involved. I am firmly convinced that they will make it work. I hope that they will be willing to make it work—without having their mouths stuffed with money—because it is the right thing to do.

Surely we need the assurance that we have the people on the ground to make it work. One of my great fears is that we do not have them.

The noble Baroness, Lady O'Cathain, seems to argue for our making the change, and as quickly as possible. She cited a case of a practice manager also being employed as a primary care group manager. Presumably within that primary care group there are other practices with practice managers. When the primary care group is set up, those managers will be redundant. They will no longer need to he paid by the National Health Service to provide that management function at the doctor practice level. The management function will be provided by one person at the primary care group level.

I exaggerate, but the system set in place by previous governments required a superfluity of managers for small groups. It is proposed that a smaller group of managers covers a larger number of people. Effectively, the money that we spend on the National Health Service will go into patient services, not management functions. The sooner we do that, the better for everyone involved.

We have now had the second red herring of the afternoon in debate on an amendment which my noble friend Lord Howe wished to be brief.

Yes, the management decision has been made. The Government want to get on with it but they do not want it to end in a mess. My noble friend Lord Campbell of Alloway is absolutely right. I readily understand that the Government will not accept the suggestion of a year's time, or 13 months. We want to know what date it will be introduced. Will it be introduced properly? Will it work? That is the only thing that matters.

The noble Lord, Lord Monkswell, does not seem to understand that a practice with, say, five doctors will still require a very active practice manager on the premises. The practice will also have someone running a much larger group of practices. The practice manager on the premises of the five-doctor surgery cannot be paid at the same rate as previously where he or she has had a much bigger role. Many of those practice managers will either want the job of the overall practice manager (there will be only one) or they will become redundant. Very few will wish to see their salary halved or greatly reduced. That is where the redundancy money comes in. I hope that the Minister will reassure us that every effort will be made to ensure that the money required for the changes is available. The story I hear from general practitioners is that they are having great trouble obtaining the necessary funding to bring in the changes.

I hope that I can be of some help to the Committee on this. I thank the noble Earl, Lord Howe, for the tenor of his introduction of the first amendment. I undertake to try to emulate his desire to be brisk and to the point. But this may not be the best amendment on which to start that process because I think that there has been some confusion in what the amendment would achieve on three separate issues.

One issue is the setting up of primary care groups which is outwith the scope of this Bill. That is going on at this moment. I shall return to some of the other issues raised. Perhaps I may say to the noble Baroness, Lady Carnegy, that, as sub-committees of health authorities, primary care groups do not need any form of primary legislation. Therefore there is no question of taking powers in anticipation of legislation. Those primary care groups will be up and functioning by 1st April. I shall return to some of the issues raised by the Committee on ensuring that they function effectively and efficiently.

I refer to the implementation date for what will be set up within the Bill. The noble Lord, Lord Campbell of Alloway, referred to Clause 1. Perhaps I can reassure him that the terms for the setting up of primary care trusts—we shall address the Committee's attention to that in a moment—have been made quite clear. We want to spend time getting this right. They will not be set up before April 2000, so there is adequate time to undertake that task.

I believe that confusion has arisen on this issue. If the Committee were to agree to the amendment, it would not delay the introduction of either primary care groups or trusts. It would delay the abolition of fund-holding. We need primary legislation for the abolition of fund-holding. The reason why an interim and residual scheme has been introduced from 1st April of this year is precisely that we recognise that need. We cannot anticipate the legislation and we have to have a residual scheme available to those GPs who wish to avail themselves of the proposal until the Bill becomes law.

The issue is simply whether extending the existence of GP fundholding until April 2000 would assist in the process with which the Committee is concerned: to ensure an orderly and effective transition to primary care groups. I suggest that it would not. In essence it would be looking backwards rather than forwards. Our responsibility is to ensure that the change which has been agreed, which no one is questioning, works well.

I pay tribute to the large number of professionals and managers who have been working extremely hard to get primary care groups off the ground by 1st April of this year. I do not recognise the noble Earl's gloomy description of what is going on on the ground in primary care groups.

Obviously, it is a major undertaking, but already boundaries and governing arrangements have been agreed around the country. The pace of change is sensible; we do not expect everything to be achieved overnight. This year, £31 million have been allocated to health authorities to help them fund the preparations. The allowances paid to PCG hoard members are reasonable and consistent with those paid to other members of NHS bodies. A revised model of standing orders and SFIs were issued to health authorities last week.

There is an issue around redundancies, to which the noble Baroness, Lady Gardner, referred, and there have been concerns about the transition of staff. Our aim is to avoid redundancies. We have set in place clear in-house arrangements to help achieve that. We have also required all health authorities to appoint an individual to co-ordinate this and other fundholder closure work. It is too early to predict exact numbers, but we are confident that most who formerly managed a fundholding scheme will secure posts in the NHS. The noble Baroness, Lady O'Cathain, said that that was happening on the ground. Our policy is that redundancy costs chargeable to the fundholder, the allotted sum for fundholding staff, should be the same as those which can be reimbursed to GPs for GMS staff under the Red Book rules. This is equitable, but it does not preclude GPs offering enhanced redundancy terms. However, if they were enhanced that would have to be a practice expense.

I return to what the amendment would achieve. It would delay the abolition of fundholding; there would be a minority fundholding rump scheme. We believe that in recognising the achievements which fundholding GPs gained for some of their patients, and looking at the way in which many of them have taken the lead in setting up primary care groups, we will serve no purpose whatever in extending a scheme for a small minority of GP fundholders. If the Committee is concerned about ensuring that primary care groups from 1st April this year, and primary care trusts as they appear from April 2000 onwards, work effectively, we need an orderly and proper parliamentary approved end to the fundholding scheme as soon as possible so that everyone can divert their attention to the future. That is the reason why within the Bill we have made clear that as soon as it receives Royal Assent and becomes law we will wind up the scheme that has been put in place simply to cover a brief transitional period. I hope that on that basis the noble Earl will not press the amendment.

I am grateful to the noble Baroness, although I am disappointed by her reply. The main point that I seek to make to her and to her noble friends Lord Haskel and Lord Peston is that the Government have not yet put in place arrangements for the orderly winding up of fundholding. That is the central issue. If they are unable to do so, it would be irresponsible to force the demise of fundholding with no safeguards for fundholder GPs and their staff.

With just over a month to go, PCGs have a vast agenda to complete in order to ensure that they are properly up and running. They must establish management structures and cost agreements; staff recruitment; accountability agreements with the health authorities; service agreements; develop investment plans; establish links with social services; design IT structures; and a whole lot more. Many PCG boards and health authorities are finding that an almost impossible hill to climb by 1st April. I believe that we need to be more sensible about it. My amendment does not mean that all fundholders must wait until March 2000 before winding up; it means that they do not have to wind up their fundholding arrangements by 1st April this year.

I am grateful to Members of the Committee who have supported my amendment and I believe that it is appropriate that we should test the opinion of the Committee.

4.15 p.m.

On Question, Whether the said amendment (No. 1) shall be agreed to?

Their Lordships divided: Contents, 72; Not-Contents, 137.

Division No. 1


Aberdare, L.Howe, E.
Annaly, L.Hylton-Foster, B.
Astor of Hever, L.Kinnoull, E.
Berners, B.Lang of Monkton, L.
Bethell, L.Leigh, L.
Blaker, L.Long, V.
Blatch, B.Lucas of Chilworth, L.
Boardman, L.Lyell, L.
Broadbridge, L.McColl of Dulwich, L.
Burnham, L. [Teller.]Mancroft, L.
Buterworth, L.Merrivale, L.
Cadman, L.Milverton, L.
Caithness, E.Monson, L.
Campbell of Alloway, L.Morris, L.
Carnegy of Lour, B.Murton of Lindisfarne, L.
Chandlington, L.Naseby, L.
Clanwilliam, E.Noel-Buxton, L.
Clark of Kempston, L.Norrie, L.
Cullen of Ashbourne, L.Nunburnholme, L.
Dacre of Glanton, L.O'Cathain, B.
Davindson, V.Pilkington of Oxenford, L.
De Freyne, L.Platt of Writtle, B.
Dean of Harptree, L.Reay, L.
Dundee, E.Rees, L.
Elles, B.Renton, L.
Erne, E.Renwick, L.
Foley, L.Rowallan, L.
Fookes, B.St. John of Fawsley, L.
Gardner of Parkes, B.Simon of Glaisdale, L.
Glanusk, L.Soulsby of Swaffham Prior, L.
Haddington, E.Sudeley, L.
Harding of Petherton, L.Swinfen, L
Hayhoe, L.Teviot, L.
Hemphill, L.Wise, L.
Henley, L.[Teller.]Wynford, L.
Higgins, L.Young, B.
Acton, L.Calverley, L.
Addington, L.Carlisle, E.
Ahmed, L.Carmichael of Kelvingrove, L.
Alderdice, L.Carter, L.[Teller]
Allenby of Megiddo, V.Charteris of Amisfield, L.
Alli, L.Christopher, L.
Alton of Liverpool, L.Clarke of Hampstead, L.
Ampthill, L.Clement-Jones, L.
Annan, L.Clinton-Davis, L.
Archer of Sandwell, L.Cocks of Hartcliffe, L.
Avebury, L.Craigavon, V.
Bach, L.Crawley, B.
Beaumont of Whitley, L.Currie of Marylebone, L.
Berkeley, L.David, B.
Blyth, L.Davies of Oldham, L.
Borrie, L.Dean of Thornton-le-Fylde, B.
Brightman, L.Desai, L.
Brooke of Alverthorpe, L.Dholakia, L.
Brookman, L.Donoghue, L.

Dormand of Easington, L.McIntosh of Haringey, L.
Dubs, L.


Dunleath, L.McNally, L.
Eatwell, L.Maddock, B.
Elis-Thomas, L.Mar and Kellie, E.
Emerton, B.Methuen, L.
Evans of Watford, L.Milner of Leeds, L.
Ezra, L.Molloy, L.
Falconer of Thoronton, L.Monkswell, L.
Farrington of Ribbleton, B.Montague of Oxford, L.
Gainsborough, E.Morris of Manchester, L.
Gallacher, L.Murray of Epping Forest, L.
Geraint, L.Peston, L.
Gilbert, L.Pitkeathley, B.
Gladwin of Clee, L.Ponsonby of Shulbrede, L.
Goudie, B.Ramsay of Cartvale, B.
Graham of Edmonton, L.Rea, L.
Grenfell, L.Redesdale, L.
Hacking, L.Rendell of Babergh, B.
Hardie, L.Rix, L.
Hardy of Wath, L.Rodgers of Quarry Bank, L.
Harris of Greenwich, L.Rogers of Riverside, L.
Harris of Haringey, L.Sainsbury of Turville, L.
Haskel, L.St. John of Bletso, L.
Hayman, B.Scotland of Asthal, B.
Hilton of Eggardon, B.Sharp of Guildford, B.
Hollis of Heigham, B.Shepherd, L.
Howie of Troon, L.Shore of Stepney, L.
Hoyle, L.Simon, V.
Huges, L.Stallard, L.
Huges of Woddside, L.Steel of Aikwood, L.
Hunt of Kings Heath, L.Strabolgi, L.
Hylton, L.Symons of Vemham Dean, B.
Ilchester, E.Tenby, V.
Irvine of Lairg, L. [Lord Chancellor.]Thomas of Gresford, L.
Janner of Braunstone, L.Thomas of Macclesfield, L.
Jendins of Putney, L.Thomas of Walliswood, B.
Judd, L.Thornton, B.
Kennet, L.Thurso, V.
Kintore, E.Tordoff, L.
Kirkhill, L.Turner of Camden, B.
Laming, L.Uddin, B.
Linklater of Butterstone, B.Wallace of Coslany, L.
Lockwood, B.Walton of Detchant, L.
Ludford, B.Warner, L.
Macdonald of Tradeston, L.Waverley, V.
McFarlane of Llandaff, B.Weatherill, L.
Wigoder, L.
Williams of Crosby, B.
Willams of Elvel, L.
Williams of Mostyn, L.
Young of Old Scone, B.

Resolved in the negative, and amendment disagreed to accordingly.

4.24 p.m.

Clause 1 agreed to.

After Clause 1, insert the following new clause—


(".—(1) The Secretary of State may, at his discretion—
  • (a) grant individual general practitioners leave to withdraw from any established Primary Care Trust;
  • (b) grant individual general practitioners leave to withdraw from the direct budgetary control of a Health Authority, or sub-committee thereof.
  • (2) Any general practitioner given leave under subsection (1) above shall take on powers, functions, and a budget as directed by the Secretary of State.").

    The noble Earl said: The Committee stage of a Bill gives us an opportunity to examine some of the broad conceptual underpinning of the Government's health reforms as distinct from the kind of matters we have just been considering; that is, structure and practice which flow from the policies. The high hopes that all supporters of the health service must share for PCGs and PCTs are, for many of us, counterbalanced by deep doubts.

    It is worth looking at a few aspects of the new arrangements. The Conservative government introduced reforms into primary care which were significant; but at the same time they were voluntary. GPs were able to choose whether or not to become fundholders; there was never any question of forcing them to do so. The present Government have adopted a different course. There is no longer a question of choice. Doctors must become part of a primary care group, and that PCG will be an entity which represents the interests of a great many more patients, doctors, nurses and clinicians than even the largest fundholding practice ever did.

    Doctors were previously given a choice, and if they wished to be fundholders they were given their own budgets and a great deal of freedom in which to develop primary care services for their local area. The benefits of that freedom, as I said at Second Reading, have been clear and tangible. Now, GP fundholders' budgets are to be taken away from them and their freedom of action within a PCG will be largely governed by the policy of the PCG itself, together with the health authority.

    The Government's stated aim in abolishing fundholding is to reduce inequalities in the delivery of primary care and to cut bureaucracy. Of course, those are laudable objectives. But will they be achieved? My first question to the Minister is: where is the much trumpeted figure of £1 billion of savings in bureaucracy to come from? As far as I can make out the only thing that the Government have done in that context is to cut the number of commissioning bodies. I accept that less paper is likely to flow in the form of invoices and so forth, but the PCGs and PCTs will still need managing and administering. That will be a much more complex task than fundholding and is bound to generate paper rather than the opposite.

    Devolved budgets gave fundholder GPs an incentive to make savings and plough that money back into primary care services. Can the Minister say what incentive GPs will have in a PCG to make savings, knowing that any such savings will be swallowed up by less efficient practices within the same group? What are the levers that will encourage them to do that? I do not see them. Indeed, how robust will the accountability mechanisms be in level one and level two PCGs? Why, in the final analysis, should a GP do as he is told by the health authority?

    Is the intention to withhold funding from any GP or practice which does not conform? Non-conforming GPs are bound to be a feature of the new arrangements. The sheer size of a PCG, let alone a PCT, which is likely to be much bigger, will make for unwieldiness in decision making. It will also make for much less of a facility to cater for local needs than has been the case under fundholding. The "accountability model"—as it is called—is weak. Meanwhile, at levels one and two it is the health authority's neck that is on the block.

    If the Government really believed in flexibility, they would have set up flexible structures to match that aspiration. Instead, they have gone the other way. That is what lies behind my amendment; a power to leave a future Secretary of State with the flexibility, if he so chose, to introduce devolved budgets for groups of GPs, should that seem to be a sensible course in a particular health authority area. Such a provision would, of course, keep a power in reserve without the need for further primary legislation in the future.

    That is the long and the short of it. It is, I hope, a modest proposal and not an offensive one. I look forward to the Minister's reply. I beg to move.

    4.30 p.m.

    Before my noble friend sits down—he has sat down but perhaps I may ask him a question. As we are in Committee, he will be free to answer. If a general practitioner is granted leave to withdraw from the PCT, would he, nevertheless, still be under an obligation to work within the National Health Service?

    Most certainly. The object of my proposal is to enable that to happen but to grant the GPs concerned more flexibility than they might otherwise have had. It would be a decision for the Secretary of State, though they would remain within the health service and subject to all the other disciplines of the health service.

    I am not sure whether a Bench can nail its colours to the mast. Be that as it may, whatever the appropriate metaphor, this seems to me the point at which I wish to indicate that, on these Benches, we support the broad thrust of the transition to PCTs. Indeed, the move towards PCGs that the Minister has indicated has already started.

    Of course, all change is uncomfortable and one recognises that the amount of work, management and sheer worrying general practitioners currently have to do is enormous. Nobody underestimates the amount of work taking place to prepare for when PCGs come into operation. In addition, nobody underestimates the amount of work which needs to be done with the Bill to improve the provisions in terms of the constitution of PCTs and in relation to accountability, transparency, partnership and consultation. We shall be seeking to ensure that a great many additions are made to the Bill in that respect.

    We do not support a command and control structure for the NHS as tight as perhaps the Government appear to he drawing it. I noticed in The Times the other day that the Secretary of State was talking about personally scrutinising the CVs of all trust chief executives. That is the route to a situation where the Secretary of State is responsible for every bedpan in the National Health Service. Quite frankly, I have no doubt that he does not wish to be responsible for every bedpan; it is bad enough being responsible for one!

    That said, there must be consent. Many of the amendments that we are considering today, which have been tabled by noble Lords of all parties, relate to the way in which the transition from PCGs to PCTs takes place. I believe that if that is run and constituted properly, the transition from, say, class 1 PCGs to class 2 PCGs and on into the PCT structure can be done in a proper, user-friendly way and mean that GPs are fully brought on board in the process. When I say GPs, I am not ignoring the other professions allied to medicine, a great many of whom have made a lot of representations on this Bill. However, I do not believe that trying to overturn this structure by a side-wind in this amendment is a sensible way to go. An opt-out for GPs by simply reconstituting fundholding by any other name is not in the interests of patients. It is certainly not the thrust of the proposals in the White Paper which we supported, and we do not believe that this amendment is the right way to go forward.

    I do not suppose one needs supernatural powers to imagine that the Minister's brief is marked "resist". Nonetheless, I support the amendment because I am sorry to see fundholding, as a concept, disappear. It has become clear to me over the years that all organisations are as much subject to fads and fashions as hemlines for ladies used to be. It is clear that fundholding is now last year's fashion. However, I would not wish the time to pass without saying that I believe this is a mistake on the part of the Government.

    I believe that fundholding was showing itself to be successful. If it had been given time, in the end, by voluntary means, all GPs would have joined in and we would have had a very satisfactory position, with none of the objections currently raised against it. However, it is clear that the Government are prepared to go on to another form, another fashion, and we are unlikely to see fundholding retained. That is regrettable. I support the amendment which seeks to leave a little loophole for it to return at some other time.

    I do not believe it is a matter of fashion. The noble Earl who moved the amendment did not address the main argument against fundholding; that is, that it makes for inequalities in the service. Patients want an equal service of a high level, not inequality of service according to where they live. That is why I believe that the move the Government are making is a desirable one to achieve that equality of service.

    I shall not pursue the "hemline" route pursued by the previous two speakers. However, I hope the Minister will recognise that this is a very unusual amendment indeed. Generally speaking oppositions resist like crazy giving extra powers to the Secretary of State, no matter what Bill is being discussed. In recent years they have been backed up by your Lordships' Select Committee on Delegated Powers and Deregulation. Indeed, we shall come to the arguments proposed by that committee a little later—probably not today, but on Monday.

    However, I would take issue with the noble Lord, Lord Clement-Jones. The amendment does not give GPs an "opt-out", which I believe was the phrase he used. As my noble friend Lord Howe stated, it allows a future Secretary of State to take account of a developing situation, and this is, of course, a developing situation. We go on from groups, through their various stages, to trusts. It may be that in some parts of the country things are not working quite as fast or as well as the Government apparently expect. I cannot see any good reason why there should not be a reserved power for the Secretary of State to take account of that. It may be that my noble friend does not have quite the right "account-taking" amendment—if I may put it in that way. Nonetheless, if we have to go back time and time again to primary legislation, that must be wrong. Therefore, I support my noble friend, certainly in the premise behind his amendment, if not in the amendment itself.

    It seems to me that the amendment is based on a good deal of optimism from those on the Benches opposite who feel, clearly, that they will be back in government at some stage and will be able to use it, if agreed, to put into effect yet another attempt to bring back a version of GP fundholding.

    It is perhaps worth recalling history. After all the efforts of the previous government to introduce GP fundholding and all the financial incentives given to GPs to become fundholders, we still ended up with only 50 per cent. or so of the population cared for by GP fundholders. Therefore, we still had a situation in which about 50 per cent. of the GPs in this country resisted those blandishments and were caring for their patients outside fundholding. Of those who had accepted fundholding, a good many did so with the greatest reluctance and felt that they were put under undue pressure to pursue that particular line. We must bear that in mind and the fact that fundholding was not the great triumph that it is presented as by those opposite. It was actually a very divisive approach to primary care for patients and it was rejected by very many of this country's GPs.

    I do not need to say, "Before the noble Lord sits down", because this is Committee. However, does he not accept that, by law, many GP practices were not allowed to become fundholders—I am referring to the smaller practices—and that therefore his figure of 50 per cent. is not terribly helpful in illustrating his case?

    The noble Earl said that this was a "modest" proposal and the noble Lord, Lord Skelmersdale, said that it was an "unusual" amendment. Perhaps we shall have a new concept in your Lordships' House—that of the modest and unusual wrecking amendment. This amendment, just like the previous amendment on which we have just voted, goes to the heart of a very firm manifesto commitment which was repeated in our White Paper on the NHS.

    I must advise the noble Baroness, Lady Fookes, that I did not need a brief marked "resist" to know that I should resist this amendment as the manifesto is dear to my heart—it is not quite written word for word on it—and I know absolutely what we said in it about ending GP fundholding—and I know that we have not wavered from that. Therefore, I echo the words of my noble friend Lord Warner.

    The noble Lord, Lord Skelmersdale, kindly offered the Secretary of State—unusually, as he said—additional powers. A Labour Secretary of State does not want to have additional powers to recreate fundholding because we do not believe that it is the right way forward for primary care within the NHS.

    As I have said, we have a clear commitment to abolish the internal market and GP fundholding in particular and to replace them with modern arrangements founded on the principles of co-operation and partnership. It is on those principles that our plans for primary care groups and primary care trusts are based.

    The fundholding system, in which individual GPs were allowed to take on powers, functions and a budget, was in fact a centrepiece of the old internal market. We recognise that although some GP fundholders used those arrangements to deliver benefits for their patients, that was done (almost by definition) because they were available only to some patients and were therefore achieved at the expense of others. Abolishing that system is crucial to the delivery of our commitment to improve the quality of healthcare overall and for all patients.

    Primary care groups, and in due course primary care trusts, will allow GPs and other professionals to work together to improve the health of, and to address the health inequalities in, their local communities. The arrangements will build on the experience not just of GP fundholders but of multi-funds, total purchasing and GP commissioning groups. They do so crucially without the competition embedded in the fundholding system and extend the influence of GPs and nurses across the full range of the health service.

    It has been argued that the amendment would provide an alternative for those GPs who feel that they have been in some way coerced into a primary care group or that they will be coerced into a primary care trust when the Bill has received Royal Assent and primary care trusts are first set up. It is absolutely true that all GPs are members of a primary care group. However, in practice, that is little different from what has been a long-established practice in the health service. I refer to GPs being on the list of a particular health authority, from which they could not opt out. They were, by definition, party to its commissioning arrangements if they were not fundholders. In both cases, they are essentially geographically based and, short of moving into other areas, GPs have only marginal choice about the group to which they are attached.

    However, GPs are, and will be, free to decide how actively they participate in the development of their primary care groups. We are looking to former fundholders to be among those leading the primary care groups forward. Many of them have demonstrated energy, enthusiasm and a commitment to patients in developing innovative services or commissioning arrangements. We want to harness those attributes. Many fundholders have responded to that challenge.

    However, it is not only fundholders who have something to contribute. I refer to the nurses who will lead primary care groups and to the other GPs who, for clear and committed reasons of principle, did not want to be fundholders but who have been leaders in developing services in their own authorities.

    We are convinced that we can extend good practice and innovation to all patients rather than start a process of levelling down. Success would be much more difficult to achieve if we were to allow the continuance or re-creation of islands of singleton fundholders. The new arrangements and the old systems are not compatible. Allowing the two to continue in parallel or, indeed, in competition for any substantial period would be a recipe for both confusion and bureaucratic excess.

    As the noble Earl pointed out, we are looking to reduce bureaucracy in order to make savings for the health service. That will be achieved not only by using across the board the funds that sustained GP fundholding for a minority of the population so that they provide the funding for primary care group management for the whole population, but also by other measures such as encouraging co-operation and benchmarking across the NHS which can save a great deal of money, by abolishing extra-contractual referrals (ECRs), by moving to longer-term service agreements and by doing away with some of the enormously wasteful and frustrating paper-chases which were the consequence of the internal market.

    The noble Earl also asked about the incentive framework to provide incentives for individual GPs within PCGs to make efficiency gains. Practices will be entitled to 50 per cent. of any savings they achieve against their indicative budgets. That entitlement will apply even if other practices in the PCG overspend in total. We have built into the system an incentive for the PCG as a whole as well as for the individual practices within it.

    Primary care trusts will be established by the Secretary of State. Progression to trust status will be locally determined, based on local views. The Secretary of State will be able to establish primary care trusts only after local consultation. The views of the primary care groups, the local GPs and other professionals, as well as those of the wider community and of the NHS locally, will clearly be key considerations for the Secretary of State in deciding whether to establish a primary care trust. It is our assumption that the support of the relative primary care group would be required—and GPs have a majority on PCGs.

    The Committee should note that this amendment would fundamentally undermine the changes which we are committed to deliver. Like the previous amendment, essentially it looks backwards and harks back to a discredited system rather than looking forward to making the new system work. I urge the Committee not to support it.

    4.45 p.m.

    I suppose that we should be thankful for some small mercies in that at least the Government are not wavering from one of their manifesto commitments. I put it to the Minister that she has been guilty of at least a little loose terminology. This is not a wrecking amendment. I deliberately have not tabled any wrecking amendments to this Bill. The amendment seeks to grant a reserved power to this or any future Secretary of State. It does not prevent the Government ending GP fundholding and fulfilling their manifesto commitment.

    I do not believe that the Minister covered my point about the Government's objective of saving £1 billion for the health service by cutting bureaucracy. I wonder whether she can comment on that and whether she still believes that that is an achievable target. It would be wonderful if it were, but I wonder whether the noble Baroness still believes that.

    Secondly and specifically, does the Minister believe that devolved budgets will be possible at practice level within the primary care groups and primary care trusts? Setting aside the amendment for a moment, does the noble Baroness believe that that is a realistic proposal for the new structures that will be put in place? Before I decide what to do with this amendment. I wonder whether the noble Baroness could answer that point.

    I can say to the Earl, Lord Howe, that there will have to be some element of devolution here in the sense that there will be indicative budgets, as I suggested in my reply about the savings and the incentives for efficiency gains. In order that people can make proper comparisons and assess their own practice on matters like prescribing, it will be necessary to know at practice level how an individual practice is doing and to be able to make comparisons. So in terms of information that kind of devolution will have to go on in order to make the situation work.

    It is very early in our deliberations to start bandying words and I would not wish to do so, but I have to say to the noble Earl that when we have a clear and unequivocal manifesto commitment to abolish fundholding and I see two successive amendments trying to recreate, either for a longer period or as a reserve power, that which we said in our manifesto we wanted to abolish and said very clearly that we were going to abolish—and we would be accused of ducking and weaving if we had put in some reserve power that we could pull back at a later time—it seems to me that we are undermining that fundamental manifesto commitment. I must make clear that we are not willing to do that. I do not quite understand what other manifesto commitments we were going back on, as mentioned by the noble Earl. Perhaps they will be listed later this evening, but I am not aware of any.

    So far as concerns the billion pounds of savings, we are still looking to that target as well as to the target reductions, including those for health authorities, NHS trusts and GP fundholder management costs that were set in May 1997, with 84 further targets of £73 million in 1998–99, which were announced in 1997, and for cumulative savings to date that are already around a quarter of a million pounds.

    Could I ask the Minister for a little clarification on what she has said? First, she says that the aim is to reduce bureaucracy—I am quite convinced that this proposal will not do that—and she is also looking for savings in financial terms. The noble Baroness said that practices would be able to keep 50 per cent. of any money that they saved. Would she confirm that that will be irrespective of whether every practice saves more than expected and will there be no ceiling at all on how much practices can save? Further, will practices be able to save, for example, by not prescribing in the same budget something like beta interfon—because that is just too expensive and certain GPs and their partners even now object to prescribing something very expensive because it affects the budget? Will GPs be able to prescribe quite freely or will they be losing their incentive if they prescribe these expensive treatments?

    The issue about GP prescribing and how we ensure equal access for patients to a variety of treatments is a much wider issue, which I am sure we will come to later. However, through the National Institute of Clinical Excellence, the national service framework and then through the clinical governance arrangements we are making sure that the best quality advice is going out to all those who are providing health services so that they can be publicly accountable through their clinical governance and in the course of clinical governance for the quality of the service which will include access to drugs, for example, to which the noble Baroness referred.

    As far as concerns the incentives for efficiency gains, practices will be entitled, as I said, to retain 50 per cent. of all savings they achieve against indicative budgets, but those savings are to be capped at £45,000, and they must be made through efficiency and not through reduction in services. I hope that is helpful.

    This has been a useful debate and I am grateful to the noble Baroness for answering the questions that I put to her. I would only say that if it had been my intention to wreck this Bill I would have given the Committee notice that I intended to resist Clause 1 as part of the Bill, and I would not dream of doing such a thing. With those comments, and reserving the right to bring this matter back at a later stage, I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    Clause 2 [ Primary care trusts]:

    Page 1, line 14, after ("may") insert (", only after a request from the doctors on the medical list of the Health Authority who would be covered by the specified area,").

    The noble Earl said: This amendment addresses an issue which is of great concern to GPs and other health professionals: namely, the fear that when a proposal is made to establish a PCT, that proposal could go out to consultation and be approved without any prior backing from those who are most affected by it, in other words, the PCGs. Unless the PCGs support the establishment of a PCT and unless the collective view of the PCGs is formally canvassed in advance of the consultation, then it is almost impossible to envisage how a PCT could successfully come into being. It would also be hard to justify spending valuable NHS resources in putting the proposals out for full consultation.

    Last Friday's circular from the Department of Health emphasised that progression to trust status would be locally driven and based on local views, but I believe we need to ask what that means. I do not think it is enough to say, as the circular goes on to do—and I am quoting here—

    "It is our assumption that the support of relevant primary groups would be required".

    I am not really sure what that means. The PCGs need to be actively in favour before the Secretary of State goes out to consultation, let alone takes a decision to give the green light to the PCT. Anything else would look very much like coercion, and we have had quite enough of that already. I beg to move.

    We seem to have two groups of amendments about consultation—am I right? I am not sure that they cover exactly the same ground, but I do not understand why there should be two groups. I noticed in the department's letter to the chairmen of health authorities, primary care groups and NHS trusts—and I was grateful to the Minister for sending a copy of that, because it was extremely helpful—that the department gives four criteria for the Government's arrangements for primary care trusts that need to be satisfied. The criteria are that they will have to put primary care professionals in the driving seat, that they will need to provide public accountability, support local public involvement and ensure probity regarding public funds and conflicts of interest.

    The question for all concerned in agreeing to proceed with a trust seems to me that they will have to decide that what the Bill proposes, in terms of accountability, public consultation and funding arrangements and indeed in conflicts of interest, will in fact enable primary health care professionals to be in the driving seat, whether or not they will stay there when all these arrangements are put into play.

    The move from primary care groups to trusts—the groups having been committed to health authorities and the trusts being self-standing—will be an enormous change and the relationship of GPs and others to the centre will change very much. It is a huge change and it seems to me extremely important that everybody concerned is happy about it. It is extraordinary that the Bill treats the matter of consultation is such a cursory way. Clause 2(4) says:
    "If any consultation requirements apply, they must be complied with before a PCT order is made",
    and swiftly sent through Parliament to set the whole thing in place. The Royal College of Nursing is very concerned about this, and rightly so. It wants to know what time will be allowed for consultation. However, I believe that we will deal with timing when we come to the next group of amendments, so the Minister may not wish to reply now in that respect. The universities are extremely concerned, especially those with medical schools and hospitals attached to them. I know one of them intimately and I am aware of the nature of the concerns. It seems to me that consultation of the sort suggested by my noble friend, or perhaps that proposed in the next group of amendments, is absolutely crucial.

    In passing, there is one matter about which I am not clear. The reason for this may be my own thick head, but I am still not clear whether the Government are convinced that GPs who are independent contractors will maintain the freedom that is legally theirs right through the story of a trust to what I believe is the fourth stage. If the Minister could reiterate precisely why they are convinced, I would be happier.

    This is not a party political discussion at all; we are trying to clarify the position and assess how we can get the system to work best for all those working in the health service. There are great questions about it and we really do need good answers from the Government.

    5 p.m.

    On the face of it, it would seem that this is quite an eminently reasonable amendment. However, the noble Earl seems to forget that general practitioners are not the only people who will play a part in the primary care groups. As someone who has spent most of his professional life working as a GP, I believe that the move from primary care group to primary care trust may be thought to be beneficial by many people who are working in the PCG or indeed in the health authority. There may be a few GPs who are not too keen to move on, but it would be for the benefit of the people living in the PCG area to do so. I am sure that many GPs in every case will want to move on to PCTs, but there is just a possibility that, in some cases, a majority of them want to stay put and not move forward. I believe that it would be wrong simply to have a ballot of GPs. Indeed, I might be more inclined to back the amendment if everyone concerned in the primary care group was balloted. I do not think that the Government should necessarily accept any rigid formula here.

    I rise briefly to oppose the amendments tabled in the name of the noble Earl, Lord Howe, and to speak to Amendment No. 16, which has been included in this group. The noble Lord, Lord Rea, has really made my main case for me; namely, that there are a large number of other health care professionals who should be involved in this process. I think it is a mistake to give individual doctors—or perhaps I should say GPs—such a pre-eminent role in determining whether or not you even begin to consider the formation or the institution of a PCT and whether or not it goes ahead.

    Amendment No. 16 follows more closely the circular in that it tries to put on the face of the Bill the necessity of having the agreement of,
    "the Primary Care Group or Groups",
    in the area which will form the PCT. Interestingly enough, it is our amendment in this grouping which has the support of the BMA.

    Several Members of the Committee have already spoken about the inadvisability of naming just one profession. Although we accept the importance of the role of general practitioners, they are not the only professionals in the primary health care team. In fact, the Government—and the Minister again, today—have made explicit commitments to include community nurses in the driving seat of the reforms. Therefore, in their present form, it would be difficult to support Amendments Nos. 6 and 12. I believe that any requirements for consultation should be inclusive of all these professions in order to be effective.

    We support Amendment No. 16. It is important not only to provide for the matters itemised therein but also to provide for the human resources element in which the professions work. That would include a human resource strategy for the whole of the National Health Service, including issues such as family-friendly employment and the issue of violence at work.

    I rise to oppose Amendments Nos. 3, 6 and 12 because, taken together, I believe that they are actually rather dangerous. Indeed, they would enable a smallish group of GPs to prevent the progression from primary care group to primary care trust, irrespective of whether most of the local health and social care professionals in the community in that particular area wanted to make such a progression. The good Benthamite principle of the greatest good for the greatest numbers is a very sound one and one upon which we should reject the amendments.

    I should also like to remind noble Lords opposite that when the previous government sought to merge family health service authorities with district health authorities, a good number of GPs were opposed to such a move. I do not recall a great deal of enthusiasm for consulting local GPs on that move. Indeed, the will of Parliament was regarded as sufficient at that time.

    We do not want to play political football with this matter. I hope that the noble Lord will not address those on the Benches opposite him as if they are always wanting one thing while he wants another. That is not what we are about when we are examining a Bill, and this is one that we want to work.

    Does the noble Lord really believe that you could proceed to form a trust with more than half of the GPs in the group being against operating within such a trust? The noble Lord, Lord Rea, was anxious about that and, therefore, thought that it was a pity to give them the chance to ballot on such a move. Does the noble Lord really feel it would not operate successfully?—because he knows about these things.

    The amendment does not put forward that particular proposition. This is all about health professionals at the local level working together on a co-operative basis. It takes a particular group of health professionals at that local level and almost encourages them to stand out against change if they choose to do so. In my view, that would not be a good contribution to the welfare of local people when we are talking about health professionals and social care professionals working together in the interests of their communities.

    I made some remarks about the Benches opposite. I should point out that the amendment was moved by the Front Bench opposite as part of a group. Therefore, I believe one is entitled to respond on the basis that the party opposite is actually supporting the amendments. I was merely reminding Members of the Committee opposite of the changes which they introduced when they were in government. There was no consultation and no right of veto as far as concerns GPs when the FHSAs were actually merged with district health authorities.

    Thus far in the debate a clear distinction has been made between, if you like, the balloting proposals in the first three amendments of the group and the proposal contained in Amendment No. 16, which—to use a word employed by the noble Lord, Lord Rea—is much more inclusive. It is certainly not our intention to have an unnecessary and artificial block on progress into PCTs. We are trying to avoid a situation which is theoretically possible. If one looks at the guidance notes, they state:

    "It is envisaged that proposals to establish a Primary Care Trust will be generated locally. The views of Primary Care Groups, NHS trusts and local communities will be taken into account in considering such a proposal".
    That does not give the PCG the primary role. In a sense, if one is going to undertake all the consultation that is proposed, it seems rather fruitless to find at the end of the day that the PCG is not favourably disposed to moving towards a PCT. That is why we on these Benches propose Amendment No. 16. We seek to make sure that the sine qua non of the whole process is the PCG itself, which includes not only GPs but also professions allied to medicine such as nurses, community nurses and so on. Therefore it is a much more inclusive proposal. What we want to avoid is the theoretical possibility that GPs and other health professionals could be delivered, bound and gagged, into the new PCT system. We think that would be highly undesirable. The foundation of proceeding to a PCT must be to obtain the consent of the PCG. Those are our motives. They are entirely distinct from those which underlie the other three amendments in the group. We hope that the Government will look favourably on this provision as a mechanism for making sure that there is full consent and that all parties moving into PCTs are part of a constructive process.

    Having heard the discussion, while I can understand and sympathise with some of the principles underlying Amendments Nos. 3, 6 and 12, I find it difficult to support those amendments. However, I believe that Amendment No. 16, to which the noble Lord, Lord Clement-Jones, has just referred, is one of considerable importance. I now pose the following question to the Minister. In her remarks a few moments ago the noble Baroness, Lady Carnegy, referred to wide consultation. That is an issue which I believe is mentioned in subsection (5) of this clause, to which I believe Amendment No. 17 refers. There are a number of important issues to which I should like to draw the attention of the Committee at a later stage. May I take it that it would be more relevant to discuss issues such as the interests of the universities and of other bodies when we reach Amendment No. 17?

    As I understand it, the principle underlying all these amendments, different though they may be, is that there should be agreement to participate in a primary care trust. It is absolutely vital that all those involved should be agreeable to this, and it should not be forced upon them. I am concerned that if the matter is left to consultation—which is a somewhat vague phrase—that could lead to something being imposed which is not welcome to the participants. I am rather taken with Amendment No. 6 because it provides for a secret ballot with a majority in favour of the proposal. I concede that perhaps it does not include the interests of others directly involved, but I think the principle of a secret ballot—perhaps involving all the people who will form the trust—is a wise and sensible proposal, rather than leaving the matter to the rather vague notion of consultation.

    Before the noble Lord, Lord Warner, spoke, I was about gently to chide my noble friend for being too prescriptive in his series of three amendments, Amendments Nos. 3, 6, and 12. As the noble Baroness, Lady McFarlane, and others have pointed out, there are many more people involved in the acceptance of all of these provisions than just GPs. I most certainly go along with that. I am not quite sure though why Amendment No. 16 is in this group, because I could support that straightaway without the slightest problem. The Secretary of State would make a grave error indeed if having slowly brought the PCGs through the various stages, he then enforced a trust upon them. I believe that would result in total and absolute chaos. I cannot go along with that.

    5.15 p.m.

    This has been a useful debate on this set of amendments. As the noble Lord, Lord Walton, said, I think it is a precursor for the debate that we shall have as regards some of the groups that we need to ensure are consulted. It has raised an issue that we shall deal with—to which the noble Lord, Lord Skelmersdale, has just referred—namely, exactly how prescriptive one is on the face of the Bill in an area where there are a large number of different groups and interests who need to be consulted, and where the list in one geographical area and circumstance may not apply to another geographical area and circumstance. By listing everything, one runs the risk either of having legislation that goes on for pages and pages and pages, or leaving out important bodies that may need to be consulted. I refer to local circumstances in this regard. However, that is a general issue to which we can return. I shall deal with the specific amendment of the noble Lord. Lord Clement-Jones, in a moment because that is much more precise.

    I wonder whether the noble Baroness can answer a question. What she seems to be saying is that the whole consultation process has a large agenda and PCGs are simply part of that. But does she accept that the requirement for the consent of a PCG comprises something other than purely consulting with the wider community, the voluntary sector, carers and so on, all of which we shall debate when we reach the later amendments?

    The noble Lord is quite right to chide me on the relationship between a PCG and progression to PCT status. I shall certainly discuss that in a moment. I was just trying to deal with the more general issue which I believe will concern us at various stages in the passage of the Bill.

    Perhaps it would be helpful to respond to the noble Baroness, Lady Carnegy. It is sometimes genuinely difficult to disentangle the role that GPs will play as commissioners of services, as providers of services as part of a level four PCT, and their services as general practitioners in the traditional sense and as independent contractors. I make it clear that in their role as general practitioners providing general medical services, the status of independent contractor will not be affected at all by primary care trusts. We recognise that it is the bedrock of general practice and that it is a major force for improving primary care. It is not the intention of the Government or of this legislation that it should be affected by the creation of PCGs or PCTs.

    I turn to the amendments in the group. As has been acknowledged, the first three deal particularly with general practitioners in relation to the progression to primary care trust status. We have made it clear all along that GPs and community nurses have a key role in developing local services and in rebuilding some of the public confidence in the NHS as a public service accountable to patients and open to the public and shaped by their views. We recognise the important part that GPs have to play in the progress of primary care groups to primary care trusts and in developing and shaping the delivery of healthcare to meet the needs of whole populations. However, that needs to involve the whole community.

    The Government's aim is for an establishment process that is locally driven and that takes into account all local views. We envisage proposals to establish a PCT being generated locally and any decision whether or not to establish a PCT will take into account the range of local views. Local doctors will, of course, have a view on that, but as has been pointed out by both the doctors who have contributed to the debate, they are not the only group of professionals or group within the community who will have a particular interest in the matter. Local PCGs will have a view on the matter—that is the issue which the amendment of the noble Lord, Lord Clement-Jones, addresses—but so too will local NHS trusts providing community services and many others, including (this is important) professional and patient representative groups.

    The PCG has a pivotal role in this process, to which I will return in a moment when I deal with Amendment No. 16. It is our assumption that the support of the primary care group would be required by the Secretary of State before he approved a primary care trust. Not all proposals will go forward for consultation. It is proposed that health authorities will select which proposals are to proceed to consultation, and then to consideration by the Secretary of State. The Government intend to provide in directions that the health authority must select proposals made or endorsed by a PCG or NHS trust providing community services locally. So there is a power for ensuring that locally generated proposals from PCGs go ahead.

    The issue we are addressing in these amendments is whether there is a veto in either body. But, on the positive and proactive side, there is some assurance that at least one of the local NHS bodies is signed up to a proposal before it triggers formal consultation.

    It is argued that these arrangements will provide GPs with a significant opportunity to influence whether or not the PCG initiates proposals and if so, the scope of such proposals, and whether or not to support others put together independently. The amendments proposed put GPs—and this was illustrated in the debate—in a uniquely preferential position. It effectively gives them the right of veto over primary care trusts. That is not the way to go forward. For those reasons I suggest to the Committee that this group of amendments should not be taken forward.

    I turn now to the wider proposal that a primary care trust should only be approved if it has the support of the primary care group. It is important to say at the start that it is no part of the Government's agenda to impose primary care trusts on the service. We believe that primary care trusts will bring benefits to patients, NHS professionals and local communities—and we are confident that people will recognise the opportunities they offer and will want them established—but we do not intend rushing headlong into primary care trusts. We want measured change, progression to trust status, driven locally, based on local views. That is why the Secretary of State will be able to establish a trust only after local consultation.

    There is clear provision in Clause 2, inserting the new Section 16A(4) and (5), for the Secretary of State to impose consultation requirements in relation to the establishment of primary care trusts. The detailed arrangements for that consultation are rightly matters for secondary legislation. Comparable orders for establishing NHS trusts are set out in the 1990 Act.

    The views of primary care groups, local GPs and other professions, as well as those of the wider community and the NHS locally, will be key considerations for the Secretary of State in deciding whether to establish a primary care trust. It is our assumption that the support of the relevant primary care group will be required. My honourable friend the Minister of State for Health made this clear to the chairs of primary care groups, health authorities and NHS trusts in a letter to them on the 19th February—which has been referred to by some Members of the Committee—a copy of which has been placed in the Library. We intend to establish PCTs in a way that is sensitive to local views, and primary care groups are key to that.

    We believe that the amendment is unnecessary and that if it was inserted in the Bill it would be unnecessarily restrictive. For example, it is possible that if two PCGs join to form one PCT, one PCG with a non-GP majority might oppose, even though the great majority of GPs in both PCG areas want to go ahead. Clearly that is a complex and difficult situation to handle—and one which we would have to be very careful and sensitive about—but to put a restriction on the face of the Bill would be overly restrictive. I hope that the explanation I have given—that we would not envisage circumstances in which proposals would go ahead without the support of PCGs—is such as to reassure the noble Lord, Lord Clement-Jones.

    Before the noble Baroness sits down, did I understand her to say that the Government would be quite happy if a primary care trust was set up in an area where the majority of GPs in that area did not want it; that it would be imposed on the GPs. Did she say that?

    If I did, it was an error. It was not what I intended to say. We would have no intention of doing that. The example I was giving was the possibility of a majority of GPs wanting a primary care trust, but the organisation of the primary care group—or one of the groups which would be involved in creating the trust—might not be supportive and therefore stand in the way of the majority of GPs. I was trying to reassure the Committee that we look for local support for these organisations. A key to local support would be local professional groups, like GPs—but not exclusively—and primary care groups would have an important role. The noble Lord, Lord Clement-Jones, is right to say that they will be key players and that their views would be a key consideration. My point is that writing that into the Bill may, in very rare circumstances, be unnecessarily restrictive.

    I thank the noble Baroness for that response. It seemed to warm up as it went along; the language became stronger and more reassuring as we proceeded. It may be that the language at the end was added later—I do not know—but certainly something like "we would not envisage circumstances" is useful language. But it is slightly contradicted—I obviously need to read Hansard—by the point the Minister made about the possibility of it being overridden. She gave the example of two PCGs going into a PCT, and so on. Therefore, I shall need to reflect on what the Minster has said.

    It is probably necessary—not only in terms of the Committee stage of the Bill but in terms of reassurance to PCG chairs and members—to amplify the letter of the 19th February. There are gaps in it and there has been some unhappiness concerning the language about,
    "It is our assumption that the support of the relevant Primary Care Group would be required".
    The Minister's current language of "We do not envisage circumstances where the consent of the PCGs concerned will not be required" is stronger and better.

    It was my honourable friend's language rather than my own which was written down in the advice. I was not trying to draw a distinction. I was trying to rephrase for him, in a way that the noble Lord might find more comforting, the assumption that is clearly set out in that letter. I take the noble Lord's point about the need to in some way clarify exactly what is involved in this. Perhaps he and I can both reflect upon this in the days to come.

    I thank the Minister for that reply. That is certainly the case. I do not think that I am alone in interpreting what she has said as more reassuring about PCGs than the wording in the letter. We need to reflect and come back to it. The Minister has given various reasons as to why it should not be on the face of the Bill—that it might create circumstances where that could not be overridden where that might be desirable, and so on. We need to think about it and come back to it on Report.

    This has been a useful debate. I realise that, when I introduced Amendment No. 3, I was guilty of not making it clear that I was speaking also to my other Amendments Nos. 6 and 12.

    I take the point made by the noble Lord, Lord Rea, and the noble Baroness, Lady McFarlane of Llandaff, among others, about inclusivity. It is, I am sure, the Government's intention, and indeed the wish of most of the Committee, that in the consultation arrangements there should be that inclusivity. There is no question about that. My purpose in putting down the amendments was to test the Government's receptiveness to the idea that there should be prior approval from a key group of professionals who would be most affected by a move to PCT status.

    The issue for GPs, as distinct from any other group of professionals, however important their role may be, is that, by moving from a PCG to a PCT, they are deprived of one very important factor, which is hands on control of the PCG under the current arrangements. Those current arrangements are ones which the Government have themselves granted to GPs. It is not as if they inherited those arrangements or anything else. They have quite consciously given GPs control of PCGs if they want it. No other group of professionals is similarly affected.

    With respect to the noble Lord, Lord Clement-Jones, it seems to me that under his amendment, Amendment No. 16, GPs could be delivered bound and gagged into a PCT unless there were some kind of formula in the voting arrangements. But that is a matter of detail.

    I am grateful to all noble Lords who have spoken. This has been a useful debate and no doubt we shall return to these matters at a later stage. In the meantime, I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    5.30 p.m.

    Page 1, line 15, at end insert ("to provide goods and services for the purposes of the health service.").

    The noble Lord said: I wish to repeat the declaration of interest I made during the Second Reading debate. I was formerly director of the Association of Community Health Councils and am currently a non-executive director of an ambulance service trust. In the interests of brevity, to which the noble Earl, Lord Howe, referred earlier, I intend to speak briefly. I will not repeat my declaration of interest at subsequent stages.

    We are now dealing with Clause 2. I wish to raise the issue of defining clearly the functions of primary care trusts. The Bill does not contain any details of the functions and it does not provide for regulations to define what the functions should be. Therefore, the only way these functions can be specified will be by the establishment orders which will be in the hands of the Secretary of State for Health.

    I am conscious that primary care trusts will be publicly funded, as is set out in Clause 3(1). It is also intended to transfer NHS properties and facilities to them, under Schedule 5A, paragraph 1(4) and paragraph 21. Furthermore, under Schedule 5A, primary care trusts will have powers to dispose of land and property and, under Clause 4(1), they will be permitted to treat private patients and to charge for those services. It is critically important that we build into the Bill safeguards to ensure that public moneys and NHS properties are utilised primarily for the benefit of the NHS. I therefore submit that limits on functions are necessary.

    It is arguable that the Secretary of State would not have powers to detail proper limits and safeguards in an establishment order, as by so doing the Secretary of State would be detracting from the functions permitted in primary legislation without there being an express power in primary legislation to permit the Secretary of State to do so. In any event, it would be more open to have these details in primary legislation than in individual establishment orders.

    What I am suggesting in the amendment is that it would be helpful to have functions specifically detailed in the Act along with safeguards to ensure that the primary care trusts operate for the benefit of the health service. Furthermore, it will be important to ensure that they do not operate in such a way as to disadvantage NHS patients or other bodies providing health or social services. It is also clear in this context that consultation issues will be important. No doubt we will return to that point when we come to discuss other clauses. I beg to move.

    I rise to speak to Amendments Nos. 5 and 24 and to Amendment No. 7 which stands in the name of the noble Earl, Lord Howe. Our amendments seek to put on the face of the Bill some description of what a PCT will actually do. They seek to set out not its powers but its functions. Amendment No. 5 amends Clause 2 and Amendment No. 24 amends Schedule 1. The two amendments are mutually supportive. Before I go any further, I should like to thank the Public Bill Office for ensuring that Amendment No. 24 was put in the right place.

    Our objective is to make the purpose of primary care trusts plain on the face of the Bill. There is a prima facie case for doing that in such an important Bill which gives a totally new structure to the purchasing of care in the National Health Service. There is also the matter of transparency. Bills are there not only so that legislators and lawyers can understand what they are about. More and more ordinary folk and the people who stand in their interests want to know what Bills are about. Perhaps I may remind the Committee that the Bill is a series of amendments to an Act which is already almost 300 pages long. Every one of those pages has at least one explanatory note. Some of them have four or five. We are in very complicated territory. That is another reason for wanting to make the purpose of this new development clear on the face of the Bill.

    Many pressure groups have seen the amendments and have written to support them for the reasons I have put forward. Perhaps I may also draw attention to the fact that in paragraph 15 of its report the Select Committee on Delegated Powers and Deregulation states:
    "If the House is of the opinion that Parliament does not have sufficient control over the creation of Primary Care Trusts, it may wish to consider amending the bill to include a statement of the purposes and objectives of PCTs".
    The formula we have chosen is not the only formula one could choose. The noble Earl, Lord Howe, has approached this issue in a different way. We could have done so. We could have taken a number of different formulae in order to get the same point across. The formula is not what we are most interested in. We want to get a description of the purpose of a PCT on the face of the Bill. I very much hope that the Minister will be able to indicate that she has some sympathy for the purpose of the amendment, even if she does not think that the formula is the one we should have chosen.

    At Second Reading the Minister argued that to include a definition of primary care trusts on the face of the Bill was unnecessary and inappropriate. She argued that on two main grounds. The first was that it was inconsistent with previous legislation. The second was that it was undesirable because what the Government wanted to achieve was maximum flexibility in the way that PCTs could operate and develop in the future. I totally understand the argument about flexibility. But what I tried to convey at Second Reading was the simple point that it was right as a matter of principle for the House to be able to comprehend directly from the face of the Bill the broad structure of what it was debating; namely, primary care trusts. I still do not think that that is an unreasonable expectation for a measure of this importance.

    Indeed, it is a view that is shared by the Delegated Powers and Deregulation Committee of this House, which suggested that,
    "the House may wish to explore whether the primary legislation might provide a general framework for PCTs which will provide a statement of the purposes and objectives within which the regulation-making powers can be exercised".
    That was a more than usually gentle hint from the committee. We should do well to take note of it. The amendment that I have tabled attempts to achieve that objective. I am not wedded to the wording, but I hope that the Government will not be dismissive of the principle behind it.

    It is worth reflecting on the background. As the Delegated Powers and Deregulation Committee said, this part of the Bill contains a wide set of powers. We shall debate their scope later. It is important for the primary legislation to place the order-making powers into a properly defined context.

    The Government have made it clear that they wish to see PCTs develop in imaginative new ways. One cannot possibly take issue with that. I do not believe that the presence in the Bill of what is by any standards a basic definition would inhibit the development of PCTs in any way whatever. So the scope for flexibility is still there.

    The enclosure with the Minister's letter of 19th February contains a whole page on the role of primary care trusts. Then the document immediately goes on to talk about their benefits. It is rather like a sales pitch. It speaks of better support to practices, better support to individual clinicians, better integrated services and better access. You then ask yourself where it relates to the role of PCTs. I mention this point merely to illustrate the necessity of being much more explicit in relation to functions. You have to turn another three pages before reaching the point where the letter states, in rather runic terms,

    "The functions of level 3 Primary Care Trusts are similar to level 2 Primary Care Groups, although with more extensive powers and responsibilities".
    We then refer back to the circular. My noble friend's amendment was drafted with reference to the circular, although in slightly more friendly and not such detailed language. It is that kind of issue that one is grappling with.

    A provision is needed on the face of the Bill. The functions of the commission for health improvement are included in the Bill; surely it would be relatively straightforward to include the functions of the PCTs. The PCTs will have a far bigger impact on the lives of ordinary people than will the commission for health improvement, so there must be a double reason for including the functions of the PCTs.

    I am sure that the noble Baroness, Lady Thomas of Walliswood, and the noble Lord, Lord Clement-Jones, were surprised when they arrived today and found that I had added my name to Amendment No. 24. I hope that they will accept my apology for not informing them beforehand. The functions of primary care trusts have particular relevance to people with a learning disability. I therefore stress the importance of heading (e) in the suggested new draft. It introduces a new function for primary care trusts to develop,

    "particular services to improve the access to health of disadvantaged or vulnerable residents".
    That function is important for two reasons. First, there is presently great confusion about responsibilities for local health services for people with learning disabilities. There is a danger that services may fall between primary care groups and mental health trusts. To that end I should welcome confirmation from the Minister as to where services for people with learning disabilities will be located in this tidal wave of reform. The foreseeable state of flux and uncertainty is a fragile basis for effective management of consultation, accountability and quality management over the next decade. This amendment would give greater priority to effective partnerships in services for people with learning disabilities, and indeed others who are disadvantaged by virtue of age, disability, ethnic origin or social factors.

    5.45 p.m.

    I am agnostic about how these functions are to be spelt out. However, I too wish to speak in support of Amendment No. 24, and particularly heading (f), which refers to,

    "The shaping of local health services to reflect local needs … which ensures the support of users and carers".
    It reflects the absolute necessity of spelling out information in what is to be a major change in health services. It will have the utmost effect on users of the health service. How we do it is of less concern to me, but we must be sure that it is done.

    I strongly support the principles underlying the reasons for tabling Amendment No. 24. One of my concerns, however, relates to the extent to which it is proper in primary legislation to lay down a whole series of individual clauses when it may subsequently become apparent that a number of points of considerable importance have been omitted. For example, heading (c) refers to,

    "the promotion of healthier lifestyles".
    Otherwise, however, the amendment says very little about preventive medicine and a whole series of other issues which might well be enshrined in such a statute.

    Is it, therefore, right that such a complicated and detailed series of proposals should be on the face of the Bill? Or might not these definitions preferably be subject to secondary legislation? If I may be pedantic, in sub-paragraph (g) the phrase "best clinical practise" should have a "c" not an "s".

    Like the noble Lord, Lord Walton, I was wondering whether the Liberal Democrat Benches had perhaps been taking lessons from the Americans, but we shall leave that aside.

    I wish to make three brief comments on this series of amendments. First, I am sorry that we have lost our two professorial economists. When I was learning economics at a very junior level, one of the first things I was taught was to define the terms before mounting the argument. I therefore go along with the noble Lord, Lord Harris, in his amendment, and indeed the other amendments which seek to define exactly what we mean by primary health groups and primary health trusts on the face of the Bill as soon as we decently can.

    However, one can go over the top. Ten years on the Front Bench opposite taught me to be very wary indeed of shopping lists; and what Amendment No. 24 provides is a shopping list. I am sure that, even if the Minister does not use those words, that is exactly what she will to tell the Committee.

    Thirdly, I have the honour to be a member of the Joint Committee on Statutory Instruments. I like to think that I do my homework fairly well and I pore over the various instruments that come before the Committee before each Tuesday's discussion. The idea of including a purpose clause in every statutory instrument pertaining to trusts fills me with total horror. It would be far better to have the provision on the face of the primary legislation; then we could all take it as read.

    A detailed list such that in Amendment No. 24 is not desirable. It would be even worse were it to include heading (j), which refers to,

    "any other activities and functions which, from time to time".
    It is already wide-ranging. Having provided a long list from (a) to (i), the amendment then adds anything else that we might like to name. I cannot support it.

    The noble Baroness has given my reply for me on Amendment No. 24. Perhaps I should try to be helpful to the Committee. The amendments propose in different ways to set out on the face of the Bill the purpose or the functions of primary care trusts. The amendment in the name of my noble friend Lord Harris of Haringey and that in the name of the noble Earl, Lord Howe, attempt to define the purpose in broad terms. In contrast, the amendments proposed by the noble Lord, Lord Clement-Jones, and the noble Baroness, Lady Thomas, define the functions in more detail. In the contributions from the noble Baroness, Lady Gardner, and the noble Lords, Lord Skelmersdale and Lord Walton, we had illustrations of the difficulties of putting down lists.

    On the broad principle of a statement of overall purpose of primary care trusts, I have some sympathy with the arguments put forward. We will have to try to define them in fairly broad terms, but we ought to try to ascertain whether we can bring forward a suitable government amendment at Report stage. It would allow the face of the Bill to show what we see as the broad purpose and role of primary care trusts. I believe we can do that.

    However, we get into more difficult territory when we try to define the functions in primary legislation rather than in secondary legislation. There was a commendable effort from the Liberal Democrat Front Bench and it broadly reflects the role that we envisage primary care trusts exercising. However, at the same time it illustrates the problems inherent in trying to define functions of that nature by primary legislation. For example, subparagraph (b) in Amendment No. 24 refers to hospital services "other than specialised services". We envisage that PCTs will be debarred through directions from commissioning some highly specialised services such as those for HIV/AIDS, or cystic fibrosis, or a number of tertiary services for children such as paediatric intensive care.

    However, there are other services such as blue light ambulance services and population screening services where we may want to direct PCTs on how they exercise their commissioning function. We might require them to commission services through joint arrangements with other PCTs or PCGs.

    Clause 2 allows PCTs to enter into such arrangements. The problem of definition has been referred to: what is a specialised service? Another problem of definition is that we all know exactly what is meant by "disadvantaged or vulnerable resident", but if we put it into the hands of the lawyers, after enacting it in primary legislation, we might all find NHS money going down the drain.

    I am not doing this in any way to try to nit-pick or challenge a very good statement of what primary care trusts will do. I suggest to the Committee that it might be a wiser course if we try to bring forward an amendment at Report stage that deals with the broad role that we envisage PCTs taking on. I hope that the Committee will find it useful.

    Reference was made to this being an issue raised by the Select Committee on Delegated Powers and Deregulation in its report on the Bill. At Second Reading I indicated that we would want to look carefully and constructively at what the committee suggested. I welcome the committee's conclusion that the argument referred to by the noble Earl, Lord Howe, whereby I proposed that the approach we had taken mirrored that in earlier NHS legislation was appropriate for the Bill and that in some ways the broad divide was acceptable. I intend to try to bring forward something that meets the points made by both the Select Committee and the Committee today.

    It might be helpful if I referred to two other broad areas on which the Select Committee on Delegated Powers and Deregulation made recommendations. One was in relation to pharmaceutical prices and profits. It stated that it would like to see an appeals procedure and also an affirmative rather than negative procedure for the powers in paragraph 36. We accept the underlying intention of that recommendation and will attempt to respond positively to it at a later stage in the Bill.

    On the issue of self-regulation of the healthcare professionals, there was the comment that there might be a statement of criteria for the exercise of the power, and in addition to the arrangements already set out in the Bill for consultation, a summary of representations received on a draft order laid before the House before that order was considered. That is another recommendation that is positive and helpful. I hope I shall be able to bring forward government amendments on those two areas, as well as on the specific one at Report stage.

    While on these points, if we look at paragraph 15 of the recommendations of the report of the Select Committee on Delegated Powers and Deregulation and the preceding paragraph, paragraph 14, they state that Part II of the Bill makes similar provisions to those that we have just been discussing for Scotland.

    I wonder whether the Government read it as the committee's intention that there should be a definition of the different primary care trusts for Scotland. I also wonder whether, in making the addition to the Bill which the Minister has just outlined, she would do likewise for Part II of the Bill. Perhaps the noble Baroness would consider it. I see the Minister sitting beside her. He may be able to help her in the matter.

    I will undertake to look at it. There is a parallel, as the noble Baroness rightly pointed out. If that parallel is one that ought to meet with an equal response, we will undertake to try to do so. Perhaps I may take it away and consider it in detail.

    Before the noble Lord, Lord Harris, decides what to do with his amendment, perhaps I may take this opportunity to thank the noble Baroness for giving constructive consideration to our debate at Second Reading and again in Committee today. I also thank her for offering to bring a government amendment forward at a later stage in the Bill. It is most helpful and I believe that the whole Committee will be extremely appreciative of the trouble she has taken to address the issues we have raised.

    I add my voice to that of the noble Earl. I thank the noble Baroness, Lady Pitkeathley, and the noble Lord, Lord Rix. We were delighted to see his signature on our amendment. It is always a great honour in this Chamber.

    We accept absolutely that the solution put forward by the noble Baroness is correct. I am grateful to her for her compliment on our drafting. We are not entirely surprised because we did our best to ground it on papers provided by Her Majesty's Government so as to make it difficult to oppose. However, we accept the solution she offered and look forward to the forthcoming government amendment.

    I am grateful to the Committee for a helpful discussion. It was clear that a consensus was emerging from all sides about the need to see something on the face of the Bill defining the role and functions of primary care trusts. It was interesting that no Member of the Committee who spoke seemed wedded to the forms of words before us in the group of amendments.

    I am a novice at all this. I understand that if my noble friend Lady Hayman says that she has some sympathy for the proposal, it should be regarded as good news. I look forward to seeing the amendment that she hopes to bring forward at Report stage. On those terms, I beg leave to withdraw the amendment in my name.

    Amendment, by leave, withdrawn.

    [ Amendments Nos. 5 to 7 not moved.]

    6 p.m.

    Page 2, line 1, leave out ("If any").

    The noble Lord said: I beg to move Amendment No. 8 which is inextricably linked with Amendments Nos. 10, 11, 14, 46, 47 and 48. Earlier today I had a conversation with my noble friend Lord Desai who was concerned to give me a lecture on grammar in case I did not make clear that all of these points were closely linked. This amendment brings us back to a discussion a few minutes ago about consultation. Clause 2 and Schedule 1 allow the Secretary of State to determine through regulation any consultation requirements on the creation of a primary care trust. The amendments in this group mean that clearer and more robust consultation requirements are written into the legislation to ensure that a thorough consultation process is followed whenever a primary care trust is created or—of equal importance—dissolved.

    There may well be circumstances in which in a few years' time primary care trusts merge. That may turn out to be a controversial matter. It is important that the circumstances in which a trust is dissolved are also subject to proper consultation. The purpose of these amendments is to ensure that there is always a consultation requirement, and that consultations are thorough, inclusive and effective prior to the creation or dissolution of any primary care trust. In each area different local communities will contain different organisations with relevant interests. Despite the need for local flexibility, there is perhaps a core group of organisations which should be consulted in all circumstances: certainly, all NHS bodies whose areas fall wholly or partly within or adjacent to an area specified in the primary care trust order; all bodies who represent patients and NHS users within the specified area, including community health councils; all local authorities whose areas fall partly or wholly within or adjacent to the specified area; and relevant professional organisations and other bodies.

    It is important to have greater clarity about the length of the consultation process. My experience over the years is that it is very difficult for local communities and organisations to be consulted properly unless there is adequate time for that consultation to take place. In particular, it is not simply a matter of small community organisations receiving a document and being able to respond very rapidly. They need time to consult their members. They may not meet very frequently. There must be an opportunity for proper discussion and understanding of the issues involved. This group of amendments provides that there should be a minimum of six months' consultation and that the outcome of that consultation should be published in all cases. The purpose is to ensure that there are equally robust consultation requirements in the event of both the creation and dissolution of a primary care trust. I hope that the Committee will accept the amendment.

    As the noble Lord, Lord Harris, points out, the Bill contains a provision for the Secretary of State to initiate consultation before a PCT order is made. What it does not do is make that consultation mandatory, unless I have misread the Bill; nor does it list those bodies which have to be consulted on a statutory basis. That is a cause for concern. In discussions that led up to the publication of the Bill complaints were made that significant bodies were not consulted at all or were simply informed of what would happen with no opportunity for participation.

    I speak now to my Amendment No. 13 in conjunction with Amendment No. 25. The Committee will note that Amendment No. 25 contains a list of those bodies which appear to be right and proper statutory consultees. I accept the strictures of my noble friend Lord Skelmersdale (who is not in his place at the moment) that there is an antipathy to lists in any piece of legislation. But the list in Amendment No. 25 is not exclusive and contains those very major bodies which are unlikely ever to become superfluous to the consultation process. The key point is that the consultation process should be thorough and effective. Amendment No. 13 in my name will ensure that there must always be consultation. But other questions arise, one of which has been posed by the noble Lord, Lord Harris: how long should the consultation period last? That is an extremely important question. Will the outcome of the consultation be published? My amendment proposes that it should be.

    I rise to support the amendment moved by the noble Lord, Lord Harris, and speak also to Amendments Nos. 15 and 17 to which I have put my name together with those of my noble friends Lord Clement-Jones and Baroness Thomas of Walliswood and the noble Lord, Lord Rix. We support the amendments that impose an obligation to consult. We very much support the amendment of the noble Lord, Lord Harris, which ensures that there is a minimum consultation period and that the outcome is published.

    As to Amendment No. 25, we have some reservations about the listing. We do not see why bodies such as the BMA and the RCN at national level should be consulted on what is essentially a very local change, although it is important that their representatives at local level are consulted. We certainly believe that to be the case. Amendment No. 15 is linked to the earlier discussion about the process of transition from primary care groups to primary care trusts. We believe that it is vitally important that the Secretary of State is satisfied that the primary care group is ready both in terms of the medical provision that it makes within the area and in terms of its financial capabilities to take over the very much wider necessary responsibilities of a primary care trust. It is also important that it has sufficient maturity to take on the necessary accountability for that status.

    Amendment No. 17 makes clear that primary care trusts belong to their communities and should include other key partners in the consultation process in the delivery of health care services, such as universities which frequently train GPs and are also involved in the training of nurses and other professionals in the medical field. It is extremely important that they are part of the consultation process. Further, dentists appear to get only a very small look in. We believe that they should be consulted to a much greater extent than they are. As to other professionals allied to medicine, such as physiotherapists and pharmacists, it is important that when setting up a community body they are consulted. Finally, patients, carers and voluntary organisations should also be consulted. This underlies the rationale of our amendments. But in broad terms this is very much a question of whether, when one does something that affects the local community so intensely, there should be an obligation to consult widely within the area.

    I rise to support Amendment No. 17, and in particular paragraph (d) which seeks to involve patient and carer associations and voluntary organisations which are involved in health care delivery. As president of MENCAP I am concerned to ensure that people with learning disabilities are adequately represented on the boards of local healthcare bodies so that their needs are not overlooked in the planning, commissioning and delivery of services and the development of strategies to improve public health.

    At MENCAP's conference last September the then Under-Secretary for Health Paul Boateng gave MENCAP assurances that people with learning disabilities would, with appropriate support, be represented on health authority boards throughout England and Wales. I shall therefore welcome today assurances from the Minister that this commitment will be honoured when the new structures are put in place, and that all the relevant consultation processes will be accessible to members of the community with a learning disability.

    On a matter of information, in December, in conjunction with the Royal Society of Medicine, we are holding a major conference of universities, schools of medicine, the dental profession and allied professions—nursing and so on—to look at the delivery of healthcare for people with learning disabilities. I am happy to say that the response from all the bodies taking part has been encouraging.

    While sharing the reservations of many Members of the Committee about lists, I add my support for the general principles of consultation. As we have heard, the consultation must be thorough and real and the outcomes reported back.

    I remind noble Lords that consultation with user, carer, patient and consumer groups is different from consultation with well established statutory organisations. The requisite support in the form of proper information, through radio programmes, respite care or expenses, must be considered if the consultation is to be meaningful.

    I rise to ask a question which I suspect will not be answered until we reach Clause 51. However, it seems appropriate to ask it now.

    I confess that I have only recently considered the Bill in detail. I was abroad at Second Reading. I cannot see that the issue was addressed at that stage. I am genuinely puzzled as to why the transfer of responsibilities to the Welsh Assembly starts only at Section 13. It is a little strange that the power to set up trusts, and for consultation, is given to the Secretary of State and not to the Assembly. If one sets out a list—I refer to Amendment No. 25—one would be bound to add the Welsh Assembly. If the Assembly is not to set up the trust and organise the consultation, clearly it will have to be consulted.

    It seems curious that we are in this situation. I may be wrong, but I do not believe that an explanation has been given on the selection of those powers which go to the Assembly and those which do not. They do not appear in the Explanatory Notes. I pose the question now in the knowledge that I may receive some brief indication. I shall return to the matter on discussion of Clause 51.

    Having been critical of lists a few moments ago, I believe that the list set out in Amendment No. 17 is wholly appropriate. It seems to me crucial that those bodies should be consulted on decisions about primary care trusts.

    The quality of general practice in this country has risen steadily since the institution of vocational training for GPs many years ago. While there is inevitably some unevenness in the quality of provision, the standard of general practice, I believe, is now the highest of any country in the world. I pay tribute to those who have been involved in this transformation.

    The universities play a crucial part in the training of doctors. Through the academic departments of general practice, they play a crucial part in training future GPs, in contributing to vocational training and to the postgraduate and continuing training of those in general practice. The medical schools have become increasingly aware of the crucial importance of teaching medical students in the community in association with general practitioners and not just in the hospital environment. For that reason alone, I believe that it is absolutely vital that university participation should be written on the face of the Bill.

    At Second Reading I referred to the parlous state of clinical academic medicine. That embraces the problems that are being encountered by academic departments of general practice. For that reason, I strongly support Amendment No. 17.

    The same problems relate to Amendment No. 25 as to the list which attempted nobly to define the functions of primary care trusts. If the BMA is to be consulted, why not, for instance, the Medical Women's Federation? If the Royal College of Nursing is to be consulted, why not the Royal College of General Practitioners? One could add infinitely to the list.

    Having given us an assurance that on the functions of primary care trusts she will come back with a government amendment at Report stage, I believe that the Minister and her colleagues are equal to the task of producing a satisfactory amendment to embrace the principles set out in Amendment No. 25. I hope that it is a matter she may be able to concede.

    6.15 p.m.

    Before the Minister rises, perhaps I may say to the noble Lord, Lord Walton, that I deliberately made the list non-exclusive. He will note that the amendment refers to,

    "such other relevant bodies as the Secretary of State shall determine".
    Therefore it does not exclude other bodies.

    I have difficulty with Amendments Nos. 17 and 25. Although I agree with the intent of Amendment No. 17, I believe that there are a number of important omissions. For instance, where would nursing be classed in the list which refers to,

    "key partners in the delivery of NHS health care"?
    Nursing is not technically classed as a profession allied to medicine. The listing in Amendment No. 25 falls into the trap that we have so often mentioned.

    A robust requirement for consultation to take place would be preferable. Bodies such as the Royal College of Nursing are asking how long the consultation process will last and how local communities and organisations should be informed about the outcomes. They suggest a six-month period for consultation. That may seem somewhat long. They also suggest a requirement for the outcome to be published in all cases. They also inquire about the consultation before a PCT is dissolved.

    We must have a requirement on the face of the Bill that the voluntary sector is consulted before any PCT is set up. They were not involved in the setting up of PCGs.

    I speak on behalf of the mentally ill. I declare an interest. I am a director of SANE and patron of Depression Alliance. I am concerned that only 33 per cent. of GPs have mental health training, and much of that is brief. The voluntary bodies do an enormous job in this field. Whatever else happens, we must make certain that they are involved in the setting up of a PCT.

    I apologise to the Committee that when I raised the subject of universities I had muddled my groupings. I had not realised that the subject would be raised now. The noble Lord, Lord Walton of Detchant, has introduced the matter in a more authoritative and able manner than I can.

    Perhaps I may add what the Committee of Vice-Chancellors and Principals has said; I expect that other noble Lords have received the information. It points out that in addition to their teaching responsibilities, university staff, including senior clinical academics, contribute substantially to patient care. It is university employees who provide 30 to 40 per cent. of consultant patient care in teaching hospitals. That is an important additional point, with which the noble Lord, Lord Walton, would probably agree. Those people do most of the science of clinical research which is essential to improvements in healthcare, as well as being major contributors to postgraduate training and continuing professional development.

    I therefore believe that an amendment such as No. 17 is important, although I do not know whether that is the way in which the Government would wish to include the provision in the Bill. The CVCP points out that major implications for medical education and research arise from changes in service delivery. The way in which the trust will operate will be different and that will affect universities enormously. I do not believe that the committee should be regarded as just another group of people to be consulted. It is part of the system and I hope that the Government will take that on board, regardless of whatever they wish to do about Amendment No. 17.

    It is sad that my noble friend's amendment does not mention the dentists, but that Amendment No. 17 does. I am pleased that Amendment No. 17 specifies dentists. For too long there has been too big a division between the British Dental Association and the General Dental Practitioners Association, which represents many National Health Service dentists and should be consulted on a more regular basis. I was pleased that the noble Baroness, Lady Sharp, made that point about dentists.

    I was impressed by the comment made by the noble Baroness, Lady McFarlane, that nursing is a huge omission from Amendment No. 17. I believe that that must be corrected.

    I am all for consultation, but I believe that a general power for consultation should be built into the Bill. The noble Baroness, Lady Pitkeathley, said that consumer groups are the most important, but everyone considers their interest to be the most important. Everyone is important. The noble Baroness stated that some authorities are well geared to sending their replies quickly. I believe that consumer groups and voluntary organisations must become better geared so that the consultation process does not take so long as to hold everything up. I heard six months mentioned, and I would be horrified by that. When I had a position with a regional health authority, I saw years wasted in consultation, after consultation, after consultation. I should like to see a general obligation for consultation and to have a time limit. I do not know whether that should he set by regulation or appear on the face of the Bill, but procedures should not be held up for ever.

    I was interested in the comment made by the noble Lord, Lord Rix—we are always interested in his comments—because dental healthcare for people with learning difficulties is a major issue. It is even more so now that dentists are not allowed to give general anaesthetics. Many of the patients he described are suitable only for treatment under general anaesthesia. They do not understand the treatment and that can be upsetting and frightening. There is therefore a requirement for consultation and for all special needs to be taken into account. I should like to see a more general power rather than it being spelt out in individual lists.

    I thank the noble Baroness for her kind words which are singularly appropriate. However, perhaps I may ask her a question. When I was young I was told that dentists wanted to be called "dental surgeons". I was told that "dentists" were people who just pulled out teeth—that was before the requisite qualifications were introduced. Perhaps the noble Baroness will clarify that point.

    A new Act was passed in 1921, after which dentists had to be qualified. Therefore, people wanted to call themselves "dental surgeons" in order to differentiate them from those who just put up a barber's pole and practised. I do not believe that any survive—certainly none still practises as far as I know! For that reason, we are all now proud to be called "dentists". The fact that dentists are also allowed to use the title "Doctor" has added a great deal to the professional standing.

    I am tempted to share with the Committee the fact that my grandfather was a dentist, but I am sure that he was properly trained. He changed his name by deed poll not when he first came to this country as an immigrant, but as a result of the 1921 Act when he had to register in order to give proof of the name under which he practised as a dentist. I am sure that such people have passed with the passage of time and no longer account for any difficulties.

    We have had an interesting and useful debate which has highlighted some of the difficulties in drawing up, particularly in primary legislation, lists of those who must be consulted in any circumstances. If we added to the list the Welsh Assembly, as suggested by the noble Lord, Lord Crickhowell, we would go even more broadly than the RCN or the BMA as consultees on what are essentially local proposals.

    As regards the Welsh Assembly, I understand that Clauses 2 to 12 amend the 1977 and the 1990 Acts. The Secretary of State's powers under those Acts will therefore be transferred to the assembly under the Transfer of Functions Order made under the Government of Wales Act. Therefore, the only provision which will be required in this Bill is one to the effect that the references in the Transfer of Functions Order to relevant provisions of the 1977 and 1990 Acts must be read as amended by the Bill. We will be introducing appropriate provisions to ensure that. Oh goodness, the noble Lord is going to ask me for even more detail!

    I wish merely to express gratitude to the Minister. It shows the importance of such explanations being included in the ExplanatoryNotes because the situation is not otherwise obvious. It is the kind of explanation we will need in Bill, after Bill, after Bill, so perhaps a precedent can be set.

    I am grateful to the noble Lord. I thought that he was going to ask a supplementary question that I would be quite incapable of answering. We are on the case, so to speak, and the appropriate provisions will be introduced at a later stage.

    In terms of the establishment of PCTs, consultation is mandatory. Clauses 16(4) and (5) have that effect. We must pay attention to two separate issues in tonight's debate. The first is the exception to consultation in certain cases of dissolution rather than establishment. Those are paralleled in other legislation. It will be undertaken only in cases where patient safety is at risk and would not be invoked in normal circumstances around merger or dissolution. It is important.

    Although we want to have local consultation in the case of a dissolution, it would be wrong not to allow for exceptional circumstances, say, to vary an order. It might be amended, for example, from being a commissioning only Level 3 PCT to a commissioning and providing Level 4 PCT. We will make clear regulations as regards the responsibilities of the PCT if it proposed any significant change in the provision of services. Those would mirror the responsibility for the consultation which takes place when a significant variation of service is proposed for other NHS bodies.

    We intend that the regulations will provide for exceptional circumstances when the requirements for consultation may need to be waived. It might, for example. appear to the Secretary of State to be necessary to dissolve a PCT as a matter of urgency. A similar power exists in connection with NHS trusts and is designed as a safeguard if patient safety is at risk. On the other hand, where a proposed change of a PCT order is a minor change—for example, a name or boundary change—we feel that full consultation is not necessary either.

    We would not like to have an absolute requirement on the face of the Bill; it would limit the flexibility. It is argued that placing a requirement for consultation on the face of the Bill is too prescriptive. And specifying the bodies which may be consulted neither takes account of the fact that those who must be consulted may change over time nor that different bodies may need to be consulted for different PCTs, depending on the functions they propose to exercise. Requirements go beyond even who must be consulted, to the period of consultation and a requirement to publish results.

    Clearly, we want there to be an adequate period of consultation—no one is suggesting that it should be a rushed and underhand process. However, as the noble Baroness, Lady Gardner, pointed out, we cannot extend that period ad infinitum. The current usual period is three months and I suggest to my noble friend that that may be more satisfactory than six months. It is also another reason why setting out in regulations the requirements for consultation is the most appropriate and practical approach. It mirrors the approach for NHS trusts. It avoids raising a large amount of procedural and administrative detail on the face of the Bill. And it allows for some flexibility for consultation procedures to develop and change over time in response to changing circumstances.

    The other amendments grouped with Amendment No. 8 indicate equal difficulties. I should like to make clear to my noble friend that we recognise the importance of patient and carer groups in terms of the consultation that should surround the creation of primary care trusts and the fact that they may not be geared up to respond as some of the professional bodies are that have full-time staff. But their views are crucial if these bodies are to respond appropriately to the needs of the communities. It is exactly the same argument put forward by the noble Lord, Lord Rowallan, in regard to voluntary organisations and their specific role and interest in seeing the proposals go forward.

    Equally, I recognise the fear that dentists are sometimes left out of the consideration when the contributions that they make—for example, to the care of those with learning disabilities—are considerable. I apologise to the noble Lord, Lord Rix, that I did not pick up his question earlier. There is no simple answer. Depending on the pattern of service locally and the services required by an individual, they may be of a specialist nature and therefore be regionally commissioned because there are regional specialist services available, or they may be at a primary care level, in which case a primary care trust that provided community services would do exactly that. We must look to the pattern of service being locally determined. I take the noble Lord's point that somebody at the commissioning level must make sure that the full range of provision is available for those with learning disabilities.

    Perhaps I can say also that the contribution and importance of the interest of academic medicine and the universities is well acknowledged. We are not suggesting that, by omitting their names from the face of the Bill and the list of people who have to be consulted, they are not key players; that they do not have an important contribution to make. From my experience in central London, it would be inconceivable not to look to the academic perspective.

    With the leave of the Committee, perhaps I can ask the noble Baroness a question which is of relevance to the universities. We had a great deal of debate when the National Health Service and Community Care Bill was under consideration in this Chamber. Eventually the government of the day conceded the right of universities to nominate members of health authorities and trusts. Do I take it that there is no such provision, following the repeal of certain sections, for university representation on primary care trusts?

    My understanding is that we are not talking about representation in terms of membership of trust boards. There is a recognition that not all the appropriate professional interests will be able to be represented at board level. It is important that at the executive committee level of the trusts and in their wider interactions with the local health community, account should be taken of other health service and academic bodies which are crucially important in the provision of both healthcare directly and in the training and education of staff. My understanding is that, because we are not talking about representatives on the boards, we are not in an analogous position to NHS trusts.

    A significant number of interests need to be considered and balanced when we look at the consultation that will take place before the setting up of a primary care trust. We talked earlier about the negative possibilities of people being able to stop a primary care trust from going forward. Here we are looking at the positives and how we ensure that there has been proper consultation. Nothing that has been said in the course of our debate runs counter to the views of the Government as to how this should be approached locally. Our difference lies in the fact that we do not feel that it is helpful or possibly satisfactorily to put all the variations on the face of the Bill; that those are best left to regulations that will be laid. That is the established way in which this has been done in the past and I suggest that it is an appropriate way to go forward.

    With the leave of the Committee, perhaps I may interrupt the Minister. One question that has not been answered is when the regulations will be published. The Minister's thesis is that these matters are best left to regulation, but the content and timing of the publication of the draft is of crucial importance if people are to accept that as a substitution for primary legislation.

    I am grateful to the noble Lord. Perhaps he will allow me to take some advice and soundings on that. I do not have the answer immediately. It is an issue to which we could return at a later stage, at which time I can give him a better idea about the timetable for regulations.

    Before the Minister sits down, perhaps I can say that, unfortunately, when the noble Baroness speaks "off-mike" the tinnitus from which I suffer drowns out the drop in the voice level. If my question has been answered, I apologise. It related to representation of people with learning disabilities on health authority boards and so forth. That was the promise given to us at our conference by the then Under-Secretary of State, Paul Boateng. MENCAP is in correspondence with the department and I would be glad if the Minister would look at that correspondence and write to me at some time in the near future.

    I am happy to give that assurance to the noble Lord, Lord Rix. I am aware that there has been correspondence; I am not aware as to exactly what stage it has reached. But I would rather deal with the matter by writing to the noble Lord than chance my arm at the Dispatch Box. I apologise for going "off-mike". One is always torn between trying to be courteous and look at people when replying and the knowledge that in so doing one may stop them hearing what one is saying. I shall try to address the microphone in future.

    I thank the Minister for her response to our amendments. I also thank noble Lords who have supported us, particularly as regards Amendment No. 17. We are disappointed that she does not see a way of including in the Bill some broad obligation to consult which we, from these Benches, should like to see. However, we take courage from the fact that the Minister has given us an assurance that such an obligation will be mandatory within the regulations. I believe it is important that the regulations are published quite quickly. As the Minister has assured my noble friend Lord Clement-Jones, of that, we hope that it will be the case.

    Amendment No. 15 was not covered in the Minister's response. I wonder whether she could deal with that now. That amendment concerns the process of transition between PCGs and PCTs and the readiness of PCGs to become PCTs. We should be grateful for a response.

    I shall attempt to do so. Perhaps the noble Baroness will let me flannel for a moment as I am trying to find the precise detail on Amendment No. 15. This is the issue about placing on the face of the Bill the criteria upon which the Secretary of State will base his decision of whether or not to establish a primary care trust.

    We recognise the need for criteria for assessing the suitability of PCGs to progress to PCTs. We want a measured transition with proposals developed and taken forward in partnership with key stakeholders. We want to ensure that people progress to PCT status when they are ready to do so.

    The amendment identifies suitable elements that we would clearly want to take into account when assessing the suitability of proposals for PCT status. They are all important issues. However, there may well be other factors which will need to be considered. We would expect to see, for example, a clear vision of how proposals to set up a PCT will benefit patients. The impact on existing services, both those that come within the remit of the PCT and wider services, would also be an important consideration.

    Again, this is not a case of us trying to undermine the importance of the issues to which the amendment draws attention; but rather that we wish to retain a degree of flexibility. It may be, for example, that in the light of experience, over time, we shall need to bring in other criteria. It is for that reason that we suggest that we do not put the provisions on the face of the Bill.

    I thank the noble Baroness for that response. Again, we are somewhat sorry that she does not see her way to include in the Bill something slightly more specific. By this amendment, and Amendment No. 17, we aim to give the Bill some teeth. I am sorry that the Minister cannot see her way to include them in the Bill.

    I welcome my noble friend's comments about the importance of consultation with users, carers, and patients. It is important, in considering such arrangements, that there is a tendency not simply to consider consultation with the professional groups and the established organisations in an area, but also to recognise the need to have discussions with users' and carers' organisations. I am slightly disappointed by my noble friend's suggestion that it would be inappropriate to put such provisions on the face of the Bill.

    I should like to comment on the point made by the noble Lord, Lord Clement-Jones, concerning publication of regulations. It would be helpful if we were able to see such regulations before the Bill finally leaves your Lordships' House. Again, I am learning the code words. "Advice" and "soundings" do not seem quite as strong as "some sympathy". However, I certainly hope that it will be possible for us to have sight of the regulations to enable us to understand exactly how the Government's thinking is developing on this matter.

    I was concerned by some of the comments made by the noble Baroness, Lady Gardner of Parkes, regarding the speed with which consumer groups respond to consultation, and the fact that perhaps they need to get their act together in that respect. I believe it needs to be recognised that we are talking of small groups of people, who may be fairly vulnerable, operating in the community. It is simply not realistic to expect them to respond at the speed with which professional organisations or statutory bodies can, and expect to, respond.

    Organisations of carers or patients may not meet more frequently than once every two months. It may be a complicated process for people to attend such meetings. Specialist care support and specialist transport may need to be arranged. It is simply not feasible for them to turn things round rapidly. Some of your Lordships may feel that three months is a fairly generous timespan in that respect, but it will not be adequate in some circumstances. I am conscious that the current Department of Health expectation, on many issues, is three months. It is remarkable how frequently those three months happen to cover the month of August or the Christmas period. That clearly makes it difficult for any organisation—even the more well-developed ones—to respond within the timescale concerned. I hope that my noble friend will be able to consider some of these matters again. However, in that context, and given the fact that perhaps we may be able to have sight of the draft regulations before we proceed much further, I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    [ Amendments Nos. 9 to 18 not moved.]

    Page 2, line 12, at end insert—

    ("( ) Every Primary Care Trust, or other body exercising functions on behalf of the Primary Care Trust, shall make arrangements for securing that they receive from—
  • (a) medical practitioners, registered nurses and registered midwives, and
  • (b) other persons with professional expertise in and experience of health care,
  • advice appropriate for enabling the Primary Care Trust effectively to exercise the functions conferred or imposed on it under or by virtue of this or any other Act.").

    The noble Lord said: The purpose of the amendment is to ensure that there is a statutory basis to require primary care trusts, or indeed other bodies acting on their behalf, to take advice from doctors, nurses, midwives and other healthcare professionals before commissioning decisions are taken. Under Section 12 of the National Health Service Act 1977, health authorities have a clear duty to involve healthcare professionals in decision-making. The wording of the amendment reflects the wording in that section.

    It is not clear in the Bill what mechanisms will be used to ensure that primary care trusts seek professional advice when they are deciding on the commissioning of medical services. Doctors, nurses, and other healthcare professionals have, of course, the kind of detailed knowledge necessary to advise on the clinical elements of the service. Their guidance and support is essential if the NHS is to work properly.

    A nursing sister, who has been running a busy ward for some years, really knows what she is talking about. To fail to collect the advice of these professionals would be a great mistake. One splendid ward sister noticed that the paper towels available in her ward were so rough that the only way they dried the hands was to knock the skin off and take the water with it. She started to investigate and found that if paper towels which actually absorb fluid were used, only one towel would be required as opposed to three of the rough variety. That saved a great deal of money. She did not have a degree in economics, but she did have sound commonsense.

    Primary care trusts will need to seek advice from experts on many issues, including on the public health services which are provided by clinicians, and on pharmacy services and services provided by the professions allied to medicine and many others. Primary care trusts will be charged in particular with building relationships with local social service departments. In the area of public health, primary care trusts will have a duty to contribute to the health improvement programme and to commission services for the benefit of the public health of their populations as well as for the health of individual patients. It will therefore be of great importance for primary care trusts to have access to high quality public health services at all stages of the commissioning process. I beg to move.

    I am afraid that I must tell my noble friend Lord McColl that I resisted the temptation to put my name to this amendment because of the shopping list phenomenon about which I have already chided the Liberal Democrats this afternoon. If my noble friend had left out paragraph (a) and the word "other" from paragraph (b), I could certainly have gone along with the amendment for all the reasons that he gave. However, as the amendment currently stands, I am afraid that I cannot support it.

    Perhaps I may find a "third way" between the two noble Lords!

    One of the key principles underlying the development of primary care trusts is to have stronger professional input. That will be achieved partly through professional representation on PCT boards and partly through the professional-led trust executive. My honourable friend the Minister of State for Health recently published the arrangements for the governance of PCTs.

    However, that is not the be-all and end-all. There will be a need for wider professional involvement in shaping and reviewing local commissioning policy and service agreements. We recognise that that is slightly different from the shopping list of consultees on the face of the Bill. It is an on-going task and it is important to have appropriate professional advice. We must recognise the key role to be played by secondary care clinicians in that work and by those in academic medicine. We would expect PCTs to ensure their involvement through, for example, membership of project teams. Similarly, the wider constituency of professional and other stakeholders will be engaged through the process of health improvement programmes, reinforced and underpinned by the new duty of partnership.

    I have some sympathy with this amendment, especially because I acknowledge that the 1977 Act contains a similar provision in respect of health authorities. Therefore, with the leave of the Committee, I should like to take the amendment away and to consider it with a view possibly to returning at a later stage with a similar amendment, perhaps slightly altered in form, which may appease the noble Lord, Lord Skelmersdale.

    I did not realise that my noble friend Lady Gardner of Parkes had left her place in the Chamber. I must take up her cudgel and agree with my noble friend Lord Skelmersdale because I should like dentists also to be mentioned in the list.

    I thank the Minister very much for her reply and I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    Page 2, line 27, at end insert—

    ("( ) Appropriate arrangements shall be made with a view to securing that a Primary Care Trust's functions are exercised with due regard to the principle that there should be equality of opportunity for all people."").

    The noble Lord said: I do not want to disguise the provenance of this amendment and I am pleased that the noble Earl, Lord Howe, and the noble Lord, Lord Astor of Hever, have put their names to it and to the linked amendment, Amendment No. 41, which relates to reporting on equal opportunities promotion.

    Amendment No. 20 is fairly straightforward. It is clearly aimed at encouraging positive action in this area by PCTs. It is very much in the context of something commendable which has happened since this Government took office. I refer to the fact that they have placed much greater emphasis on reducing inequalities in health. That is reflected in their consultation paper on public health which explicitly recognised ethnicity as a factor associated with poorer health outcomes. Since then, the action report has been helpful in plotting some of the key areas for action. I have no doubt that that will be reflected in the Government's White Paper on public health, to which we all look forward greatly.

    Surveys conducted by the Commission for Racial Equality, which in a sense is the provenance of this group of amendments, show that the ethnic minorities are concerned about access, outcomes and a variety of other matters related to inequality. We believe—this is particularly important and we have seen it only recently in other public services—that it is not good enough simply to be colour-blind; we must go out there and take positive action to eliminate inequalities. That is the only way to tackle some of these issues.

    In 1992 the Commission for Racial Equality published a code of practice for primary healthcare services. However, it felt that the level of take-up by, and interest from, practitioners was not adequate and that there needed to be a statutory duty to promote equality if real action was to be taken by those working in the area, such as the primary care trusts. These provisions fall very much within the overall general principles of the CRE as enunciated in its proposals for reform of the Race Relations Act. Public bodies should have a general duty to work for the elimination of racial discrimination and for the promotion of equal opportunities. This amendment is clearly in line with the CRE's existing proposals. In a sense, the CRE has now followed up that long-standing set of proposals with its leadership challenge—an interesting challenge to all of us in public life—on the active promotion of equality. The CRE expects political parties, public bodies and others to promote that challenge. The health service should be no different. Indeed, it should be better than other institutions at doing that.

    I strongly commend the approach set out in the amendments, which simply seek to impose a general duty to promote equality of opportunity. There is, in fact, a parallel. The Welsh Assembly has such a duty. That is provided for in the Government of Wales Act. There is, therefore, a precedent for this. It is with great pleasure that I recite precedent because we often hear from the Government Front Bench the argument, "Oh no, we have done this for years", so I say, "Well, we've done this for a year", so I very much commend this approach.

    It is often very easy to insert words into Bills but I really believe that inserting such a provision into this Bill would kick-start something at local level. It would be absolutely four-square with the duties of a PCT and it would be a valuable signal, particularly in the current climate. I beg to move.

    I rise to support Amendment No. 20. The needs of ethnic minorities must he addressed. The primary care trusts must ensure equality of access to patient care for all those who need it. An equitable service requires sufficient information, training and resources to cater for all sections of society. The Royal National Institute for the Blind has collated clear evidence that people of African descent have a higher risk of developing glaucoma. The primary care trusts will need to recruit, train and retain staff who are able to communicate effectively with ethnic minorities and those who do not have English as their first language. Such appropriate arrangements should ensure that access to high quality patient care is equitable for all.

    7 p.m.

    I am wondering whether the wording is right. Of course I go along with what the noble Lord, Lord Clement-Jones, has said: the principle should be equality of opportunity for all people. In this case, is he talking about all patients? Obviously the opportunities for staff and patients are different. It is a bit bland and sounds rather like a formula. I wonder whether it could be made more precise.

    I thank the noble Baroness for that intervention. Of course it is fairly general and of course it applies not only to employees. Indeed the principle itself applies not just to ethnic minorities but also to gender balance and other aspects. If one started writing a more detailed principle, one might then be accused of making lists, I suspect. One has to he careful about this. This is a commonly accepted formula. If there is a better way of putting it I would very much welcome that. This is, as I say, a general formula, but it puts the onus on the trust to act in a positive way. It is not simply a passive approach.

    I am grateful to those Members of the Committee who have spoken and to the noble Lords who tabled these amendments which, importantly, raise the issue of equal opportunities within the National Health Service. I would say to the noble Baroness, Lady Carnegy, that we have to tackle within the health service both the issue of equality of access to services, to which these amendments were predominantly directed, and the issue of equal opportunities for staff members within the NHS. Although the amendments to this Bill may not be the appropriate way forward for ensuring that, and we must have a much wider programme to tackle both issues, both are important. Perhaps on the latter I might say, because it is important to make absolutely explicit the commitment in public services in these areas, that we are committed to rooting out all racism within the NHS and to ensuring that both patients and staff are treated with respect and fairness.

    In December of last year we launched a campaign to tackle racism and set existing NHS bodies tough targets in order to stamp out racist behaviour. We have also, very importantly, increased the representation of non-executive directors who come from an ethnic minority background on the boards of NHS trusts and authorities. We have also signed up the NHS to the Commission for Racial Equality's Leadership Challenge. So there is a programme of progress in those areas.

    In introducing his amendment the noble Lord, Lord Clement-Jones, put it firmly in the context of addressing inequalities in healthcare, and the noble Lord, Lord Astor, also referred to these areas. I think it is important that we identify within our new framework for measuring NHS performance fair access to services as one of the key dimensions against which the NHS will be assessed. We made clear in A First Class Service that all NHS bodies will be reporting annually on clinical governance, and within the ambit of clinical governance delivering on that commitment for fair access to services is very important. It is another opportunity to pursue that theme.

    We intend to extend to primary care trusts the same drive to ensure that patients and staff are treated with fairness and respect, and we will need to look carefully to ensure that this permeates throughout the new arrangements. I am sure we shall expect to see it reflected in primary care trusts' annual reports, just as we see it now reflected, although there is no statutory obligation to do so, in the reports from NHS trusts.

    It is an absolutely key theme of the Government that we should reduce health inequalities, and within the national priorities guidance issued for the NHS and for social services we made that absolutely clear. We have to make clear too that we recognise the diverse and sometimes differing health needs of different populations, to which the noble Lord, Lord Astor of Hever, referred. Yesterday I was launching a campaign to encourage organ donation among the South Asian community, where the rates of kidney disease linked to diabetes and high blood pressure are much higher than among the ethnically European population but where in fact the rates of donation are much lower. It is important that we recognise the health needs of particular ethnic groups and make sure that they are addressed. Often at primary group or trust care level that will be the absolutely appropriate place so to do.

    I should like the opportunity to consider further these amendments. We want to take forward a shared agenda with both Front Benches opposite on these issues. If I may, I should like to look at the best way to take the points forward and whether they can be accommodated in terms of amendments to the Bill. I am happy to give that assurance, if the Committee agrees.

    Just on the wording, I have a dislike of bland expressions that do not mean anything and, with the greatest respect, I think that,

    "equality of opportunity for all people",
    is not a description of anything. Someone who is a surgeon may have an opportunity to become a promoted surgeon or whatever, but a patient does not necessarily have the opportunity to become a surgeon. If the wording simply said "equality of opportunity", that is what we are all talking about. I just wanted to justify my little intervention.

    I entirely agree with my noble friend. There is something not quite right about the phraseology, although I agree that the concept and principle behind it are fine. Are we not dealing with the patients, or the people in the community which the trust will serve, and will not staff already be covered by general legislation on equal opportunities?

    I hesitate to intervene, but I should declare that I am chairman of the sex equality group in the Houses of Parliament. I wonder whether the description given by the Minister of an equal opportunities policy within the health service actually came up to the target of being an equal opportunities employer, which is a good deal more than just showing respect to all different sorts of employees. There is a strict code attached to the designation.

    In her substantive response just now to the noble Lord, Lord Clement-Jones, the noble Baroness said she would like to take this away and look at it. Given that the beginning of the Bill amends the National Health Service Act 1977, in her consideration will she think about amending that Act to make it much more general than just primary care trusts?

    We have had a variety of helpful suggestions about what areas we should consider as regards amendment. I absolutely take the noble Baroness's point; I was trying to make the same point in a rather different way. We need a whole raft of actions if we are to behave satisfactorily in this respect. One small piece of legislation, as the noble Lord, Lord Skelmersdale, points out, in a very narrow field may be an important point at which to start, but certainly not an end point. With the leave of the Committee, I shall take away all the suggestions that have been made and perhaps come back at a later stage.

    I thank the Minister for her replies. I understand that there could well be other, wider formulations which could usefully be introduced. However, I hope that we do not reach a situation where in a sense the best is the enemy of the good and that we do not try to invent some rocket when actually a bicycle would do. We are talking about primary care trusts and ensuring equality of opportunity, especially as regards access. But that should also encompass other matters.

    It would be a shame if we were to spend hours labouring over a formula that would cover every single aspect when it could quite simply be determined for primary care trusts, which, after all, are the key component that we are talking about in this part of the Bill. Of course, it is essentially "access" that we are considering. I accept that a great deal is being done on the ground, but the issue about primary care trusts in particular is that there are many more of them. Indeed, you can reach down in a fairly controlling way into the NHS trusts, into health authorities and so on; but it will be more difficult to get into the practices of PCGs and PCTs. Therefore, my argument would be that it is more important to have this statutory duty for PCTs than it is for any other part of the health service simply because of the issue of management and control. I am delighted that the Minister has agreed to consider the amendment further. I look forward to the Report stage in that respect. I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    7.15 p.m.

    Page 2, line 27, at end insert—

    ("( ) Upon approval of proposals under subsection (2) in respect of a particular local authority area the local authority shall be entitled to exercise all the powers of the Secretary of State under section 97D of this Act.").

    The noble Lord said: We are getting very close—I hope—to the witching hour of 7.30 when we may perhaps be able to take some refreshment. But I have considerable enthusiasm in moving this amendment. In doing so, I shall speak also to Amendment No. 22, as they fall into the same grouping. This is essentially about taking forward the report of the Health Select Committee of another place, which many noble Lords will have read with considerable interest before Christmas. The committee effectively argued—I thought extremely cogently—for greater integration than is currently envisaged in the Government's proposals as set out in the original White Paper. I quoted from the report on Second Reading, and make no apology for doing so again. The quality of the work being done by that Select Committee is of a very high standard. In paragraph 65 of its conclusions the committee said:

    "We consider the current system for continuing health and social care to be very confused. Responsibilities are blurred, professionals face unnecessary problems, and users and carers are suffering because of barriers created by a structural division which is based on a ill-defined and arguably non-existent boundary".

    Later, at paragraph 68, it said:

    "The [Department of Health's] proposals in Partnership in Action to allow a lead commissioner and integrated provision are a step in the right direction. However we consider that the problems of collaboration between Health and Social Services will not be properly resolved until there is an integrated health and social care system, whether this is within the NHS, within local government or within some new, separate organisation".

    It is interesting to note how the Select Committee came to its conclusions. At the end of the day, members of that committee felt that the professions—and, indeed, the managerial evidence—were rather cautious. Their experience on the ground, especially when they went to Northern Ireland and saw how the system operates in practice there in a very integrated fashion—something that the NHS in England does not have—led them to think that it was highly desirable.

    I recognise that this would be quite a challenge to an organisation which is already undergoing considerable change. But the former Minister of State was permanently talking about the "Berlin Wall" between social services and health services. If we are to have an effective integration, it seems to us that it cannot be done just by joint working and pooled budgets; indeed, we will actually have to go a step further. What we have tried to do—and, in a sense, this is perhaps a bit of a balloon debate on the subject—is allow for a situation, which may not be perfect, where, once PCTs come into operation for the whole of a local authority area, that local authority effectively assumes the powers of the health authority. Indeed, if a PCT gets to stage four or partially to stage three, it will be in the process of withering away in any event. Matters like public health would then rest alongside social services within the local authority.

    I suspect that the Royal Commission on the long-term care of the elderly will also propel that movement. No doubt it will recognise that joint working, pooled budgets, and so on, will all help but that at the end of the day in order to get a coherent system of care, especially for the elderly, there will have to be a much greater level of integration than is envisaged in the Bill. Our contention is that there needs to be some mechanism whereby a local authority can take over the function of the health authority in those circumstances.

    One of the issues that was addressed quite strongly in the report of the Select Committee was the democratic deficit. It is not just a question of the actual integration of care and the quality of care between social services and the health service; it is also a question of the democratic deficit in terms of the accountability of the health service. In the pre-1990 days there was an element of representation from the local community on health authorities. That accountability disappeared, and this is also an attempt to try to inject a much greater element of democratic accountability into the process. That was one of the aims of the Select Committee as set out in its recommendations. I commend the latter to the Committee.

    It might be considered initially as quite a bold step. But when we consider the amount of work which will need to be done in any event over joint working, pooled budgets, and so on, why should we not take it a step further? This is only conditional; indeed, it is conditional on PCTs covering the whole of a geographical area and does not involve a rushing of the gate in any sense, because the PCTs will need to be formed and people will have to have fairly sophisticated management systems in those circumstances. Therefore, I hope that the Committee will carefully consider this proposal. It is not so outlandish. It is something which will inevitably happen, so why should we have to wait for another few years for further recommendations from perhaps a distinguished Royal Commission, or indeed a review or a report from another Select Committee, before we actually institute such changes? Such changes could be of huge benefit to those receiving a mixture of both social and healthcare at local level; indeed, let us face it, it often is a mixture. I beg to move.

    I rise with some reluctance because, from these Benches, I do not feel that we can support the amendments proposed by the noble Lord, Lord Clement-Jones. I shall not go into too much detail in the interests of brevity, but I believe the kind of path that the noble Lord is inviting us to go down would lead to a lack of clarity in responsibilities. Indeed, it could lead to confusion in the rules surrounding propriety in the use of public money. In general, I think it is undesirable to transfer health functions to bodies which are not concerned with the management of health as a full-time business. Therefore, I am afraid I cannot support the amendments.

    I warmly support what my noble friend Lord Howe has just said. It would be very dangerous to pass responsibility and power to local authorities in these circumstances. With the health authorities, we are going to get a good deal of consistency across the country as regards administration of this scheme, just as we had under the former National Health Service. But if we are going to give overburdened local authorities these specialised responsibilities we shall not get an even pattern across the country. We could get a serious variation. I hope that the Minister will also resist these amendments.

    I touched on this matter on Second Reading—as the Committee will recall—speaking from my experience as a former health Minister in Northern Ireland. The system we are discussing only works there because you have one body, a health and social services board. There is a good argument for rolling the four boards into one, but I shall not go into that at this moment. However, if one side or the other is dominant—which is what I think these two amendments propose—one is in danger of coming across all the difficulties that my noble friend Lord Renton has foreseen, and has just stated.

    I wish to make a couple of brief points in support of my noble friend. It seems to me to be quite sensible—this is a direction in which I feel we are bound to move at some point—that the commissioning of healthcare (that is, how the money is spent) is, as it were, united with the commissioning of social care under one authority. My noble friend has suggested that that should come under the local authority. I find that satisfactory for the following reason; namely, that in that way a democratic accountability would be introduced.

    I was a member of a local authority and of a hospital trust at the same time. The most uncomfortable element of membership of the trust board was that I had no standing vis-à-vis the people to whom that health trust delivered services. There was no way in which I could go to them and ask, "What do you think about this?", because that is not the way it works. Had I done that, I would simply have been removed from the health board, as I am sure my fellow members would not have thought that that was a proper thing for a member of a board to do. The difficulties involved in the relationship between hospital trust boards and their surrounding communities should be an example to us of the advantages of placing the health service within a democratic context.

    I believe that the health service is in a democratic context, but it is within a national democratic context. Some of the contributions that have been made to the debate have recognised the importance of that point and of the maintenance of a devolved structure. They have recognised the importance of establishing mechanisms through local boards and through some of the provisions we have discussed today for ensuring that local decisions reflect the views of local communities. I have tried to be helpful to the Committee as far as possible. However, I shall adopt the strictures of those on the Benches opposite who have spoken against this provision and be firm in my rejection of the amendment.

    I do not do so because we in any way wish to downgrade the issue to which the noble Lord, Lord Clement-Jones, spoke in detail; namely, to ensure that we dovetail services for individual patients, and that there is not some false divide between the care that is given by social services departments and the care that is given by the health service. Indeed the provisions that we shall discuss later in the Committee's deliberations under the partnership section of the Bill are designed to do just that and to go wider than a consideration merely of social services. We should consider the whole of local authorities' functions in order to achieve more effective co-operation between the NHS and local authorities. Those provisions have been widely welcomed.

    However, the amendment we are discussing would have a much more far-reaching effect. It would allow local authorities to assume the functions of health authorities, effectively bringing local health services under local authority control. That is quite simply not the Government's policy for the health service. I recognise the point that the noble Lord, Lord Clement-Jones, made regarding the recommendations of the Health Select Committee. I shall discuss those in detail shortly. However, it is worth noting that that committee recognised in its report that its proposals had received little support from those who gave evidence to it. That included the Secretary of State, who made it clear in his evidence that he felt major structural reorganisation was both unnecessary and would be highly disruptive. Earlier in the afternoon we debated how disruptive change can be, even measured change in limited areas.

    What we are trying to do is to allow an approach that does what both local authorities and the NHS have asked for; namely, to remove the longstanding legal barriers to joint working without imposing the turmoil of major upheaval. Provisions in the Bill will allow for integrated working where that would lead to better outcomes for patients and for clients. However, as regards the evidence that was given to the Select Committee, and the responses that we received to our Partnership in Action discussion document, it was made quite clear to us that the kind of major structural change that this amendment would involve would not be helpful. We can achieve the ends that we seek to achieve through the partnership arrangements. I urge the Committee not to pursue this amendment.

    I thank the noble Baroness for that not unexpected reply. I am not surprised at that response. When I introduced the amendment I did not seek to minimise the lack of support for the provision among those who gave evidence to the Select Committee. I believe that the Select Committee is composed of some pretty far-sighted people. I say that because I agree with them! They have looked several years ahead to consider the impact of joint working arrangements and pooled budgets. Some of them have had a long involvement in the health service. After taking evidence—even the negative evidence, as the noble Baroness has mentioned—it was their considered view that the provision would not be sufficient.

    I make my next point with all due deference to the noble Lord, Lord Skelmersdale. I appreciate his experience of the Northern Ireland situation, but he did not say whether he thinks that the standard of integrated care is higher in Northern Ireland as a result of the system that is adopted there. One can have this one way or the other. One can have the health service undertaking all these functions or local authorities undertaking them. We propose that they should be undertaken by local authorities. Our view is that after a period of time it will become quite clear that the mechanisms that are being set up under the banner of partnership, with the best of intentions—we fully support that intent—will not be sufficient to provide healthcare in the seamless way in which everyone in the voluntary and the health sectors is striving to achieve. Clearly, however, we have some way to go in the persuasion stakes. No doubt the campaign will continue—"la lutta continua". This is an area of considerable importance, and will continue to be so. I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    [ Amendments Nos. 22 and 23 not moved.]

    Clause 2 agreed to.

    Schedule 1 [ Primary Care Trusts]:

    [ Amendments Nos. 24 and 25 not moved.]

    This may be a convenient moment to break for dinner. I suggest that we reconvene at eight o'clock.

    [ The Sitting was suspended from 7.28 to 8 p. m.]

    Page 42, leave out line 3.

    The noble Baroness said: In moving Amendment No. 26, I wish to speak also to Amendments Nos. 27, 28, 30, 31, 32, 33, 34, 35 and 36. Amendment No. 29 will be spoken to from the Official Opposition Benches.

    These amendments concern the governance of the primary care trusts, In particular they are intended, first, to make the membership of the board of the primary care trusts more representative, both in terms of the healthcare professions and in terms of local voluntary organisations, carers and lay members of the community; and, secondly, to make selection of the chairman more democratic, so that the body chooses its own chairman rather than the Secretary of State.

    We on these Benches are most anxious that the boards of the primary care trusts are not run by the medical profession for the medical profession but that they represent the broader community in which they are located. In particular we are anxious that they represent both those who are providing care and those who are receiving care. It is vital that the professions allied to medicine are included, as well as the voluntary bodies and the carers.

    I shall run quickly through the different amendments. Amendments Nos. 26 and 30 are allied to Amendments Nos. 33 and 34. They make it clear that we would like to see the members of the trust choose their own chairman from among their own members, rather than having the chairman chosen by the Secretary of State. Amendment No. 27 argues that a majority of the members of the trust should not be officers of the trust. Amendment No. 28 lays down that the various members of the trust shall include lay members representing the local community. Amendment No. 31 lays down that, in addition to lay members, there shall be representation from members of the other healthcare professions and not just general practitioners. Such professions would include community and practice nurses, social services, dentists, pharmacists, physiotherapists and opticians. Amendment No. 32 concerns the range of skills that we would like to see represented within the primary care trust. It is especially important that patients and carers, and those who have been patients and carers, are represented on the primary care trusts as consumers of primary care. Amendment No. 35 again makes it clear that the regulations shall include not only representatives from the medical professions but also representatives from the professions allied to medicine and from the nursing and midwifery professions. Amendment No. 36 places an obligation on the Secretary of State to consult widely within the community about appointments to the primary care trusts. We are anxious to ensure that those selected are widely known and respected within their communities.

    As I have said, Amendment No. 29 comes from the Official Opposition Benches. As far as we are concerned, it goes in the opposite direction. By laying down that a majority should come from the medical profession, the amendment does not exclude the possibility that the medical profession could dominate the PCTs, which we would be unwilling to see. I beg to move.

    I rise to support Amendment No. 28. There is real concern that older people are often discriminated against in the NHS because of their age. I hope that the Minister will see the wisdom of having at least one lay member on trust boards representing the interests of older people. Organisations working with older people are told time and again of instances where older people are suffering in certain conditions because they are old. As a result, old people are often too frightened to complain. PCTs will have responsibility for a greater number of treatments which primarily affect older people. I therefore hope that the Minister will support the amendment.

    Due to the rushed nature of our eating requirements, I did not appreciate that marshalled in this group of amendments was the one concerning older people, which is of considerable importance.

    As many of us know—not only from our own experience but from the representations made to us—there is an increasing concern that people are being discriminated against in the NHS because of their age. Amendment No. 28, which was referred to by the noble Lord, Lord Astor, is, in our view, of considerable importance as regards ensuring that discrimination does not continue. It is specifically important that there should be older people on primary care trust boards. We shall be talking later about amendments which relate to old people, but there is no doubt that there is an enormous degree of concern, not only about access but about treatment. There exists, in a sense, a kind of rationing. In order to tackle that kind of problem, we should be very conscious of the kind of representation we have on the primary care trust boards. That representation should specifically include older people, who will well be able to appreciate the problems that older people face.

    One could argue that there should be representation for every one of every type among the lay members, but I seek to make a special case for older people. They are massive consumers of healthcare—they face almost unique problems in the way in which they interface with primary care—and it is very important that they are not just, in a sense, passive users, but people who are able to drive forward primary care provision in a positive way by their representation on trust boards.

    I rise to support Amendment No. 28 because old people and children take an enormous amount of the budget of any national health service.

    I am concerned about Amendment No. 31, which is grouped with Amendment No. 26. It contains another list and, as we have already discovered, anything containing lists is extremely dangerous. We should remember that there is a huge body of people in professions in the NHS which used to be laughed at. I refer to the alternative medicine brigade. There are now very large clinics in some areas which practise medicines such as acupuncture, osteopathy, reflexology, kinesiology and so on. It is beholden on us to remember that an enormous number of people want to go to alternative medicine practitioners as opposed to using the National Health Service proper. We must take some of those large practices into account as well. Therefore, I do not support Amendment No. 31, but Amendment No. 28 is good.

    I support Amendment No. 28. I do so because the Government's claim that there is no age limit on appointments to any NHS body is a complete fiction. I meet people who tell me all the time that an invisible barrier is definitely there. I understand that there may be a problem with older people if there is a risk that they may develop senile dementia. None of us is immune to that. But to get round that, the appointments of older people could be made for a limited time and would be renewable only if the people were suitable. By that I mean that they remained mentally alert.

    It is wrong and hypocritical when we hear that age is irrelevant that the first thing one puts on any application form for a National Health Service position is one's date of birth. Those looking at those forms then sift through them. I should like to know how many older people will be on NICE and so on. This amendment is required on the face of the Bill to make it clear that there should be an obligation to consider older people.

    I support Amendment No. 28 but I should like to look at the issue in another way. The amendment states:

    "including lay members representing all sections of the community including older people".
    Enough has been said about older people and I will certainly support that. But let us not forget people at the other end of the spectrum. I refer to younger people.

    In our area we have a local patient support group. It has representatives who include a 17 year-old, a single mother with two children and a disabled person. It also includes several elderly people because that reflects the demographics of the area. It has worked like a charm, particularly for the 17 year-old and the 23 year-old. They have now had experience of working on a committee, of listening to people's views and of going to their sections of the community and feeding back information to the doctors and to the practice manager. It has revitalised the involvement of the community with the practice and has made people realise exactly how much work doctors do and how they need to he safeguarded against people who do not turn up for appointments. The young people are going to their friends and saying, "You can't make a doctor's appointment and not turn up". It is not the older ones who are doing that. The older ones represent people's needs in terms of access for disabled people, the requirement for hearing tests and so on. But it is the youngsters who are coming forward and stating the problems. I suppose they could even alert the doctors to where the drugs scene is becoming serious in the area.

    If the Government really want to be an inclusive government, they ought to start now and consider including quite young people in these groups, if only for a limited period of time—perhaps three years or so. They will benefit, the groups will benefit and certainly the young people will benefit. Young people generally will feel that their views are taken into account. I do not want to put on the face of the Bill the words "including young people", but I hope that the Minister will take the point on board.

    8.15 p.m.

    I rise to speak to Amendment No. 29 which ventures to take an opposite path to amendments tabled by the Liberal Democrat Benches in that it relates to the question of who should constitute the majority on the PCT board and proposes that that majority should rest with those who are professionally qualified. I do not think it is a contentious statement to make that if the NHS is to be asked to tolerate yet another period of adjustment, as it is, it is important that the changes are soundly based. A sound base involves our being very careful indeed that we take the doctors with us; indeed, not just doctors—of course not—but I single out doctors because, unless GPs feel that they own the new system, they will not respect it. Doctors will not want to feel dragooned into PCTs.

    Let us suppose that there is a proposal to convert a PCG into a PCT. What everyone understood from the original White Paper was that progress up the PCG ladder would be entirely voluntary, but it appears that that is not so. A proposal can he initiated by anyone in the PCG, by the local community health services or by a health authority. Let us suppose that the proposal goes out to consultation and the Secretary of State decides. If GPs do not like it there is no veto for them. A PCT is then established. The one thing that doctors will want to feel once they are in it is that they have a real measure of control and real responsibility for what the PCT does. If GPs see in PCTs a structure of decision making that erodes the degree of influence and responsibility that they enjoyed in a PCG, there is a risk that confidence in the system will evaporate. GPs will see it as an attempt to impose line management on them.

    We have to remember that a general practitioner is an independent contractor. A doctor will not accept a system that threatens to interfere with the one relationship above all which counts for him—the relationship with his patient. Nor will he embrace a structure which lacks a sense of corporate feeling and identity. I believe that the Government's proposals for PCTs, which originally, it has to be said, looked like manna from heaven to many doctors, have had the gloss decidedly knocked off them by fears of this erosion of influence at management level. It is perfectly true that expressions of interest in PCT status have been quite numerous, but I wonder how many of those will develop into firm applications once people have reflected more deeply on the Government's proposals.

    At Second Reading the Minister said that the Government wanted to build on what was best in the NHS that they inherited. But putting aside for one moment our disagreements about the merits or demerits of fundholding, one of its undisputed benefits was the way in which it put GPs in the driving seat and in so doing drove up standards of healthcare. That is the broad principle the Government say they want to preserve and carry forward in the new arrangements. I sincerely hope that they know what they need to do to make that objective a reality for doctors. If they do not achieve it, the risk to the NHS is substantial.

    I have considerable sympathy with the objectives underlying both Amendments Nos. 28 and 29. On Monday last I spoke in your Lordships' House on trying to persuade the Royal Commission to oppose any principle that there should be a mandatory age of retirement for life Peers. It is seven years since I received a letter from the Oxfordshire health authority thanking me for my services and saying that, now I had reached a certain age and my honorary clinical contract had expired, I could visit the hospital for social reasons but could not use the clinical facilities.

    We may bear in mind, for instance, the attitude of the United States Government. They have now decided that discrimination on grounds of age is illegal and is contrary to the US constitution. It is right that the Government should seriously consider the possibility of involving not only younger people but older people in many of the bodies concerned with the management of the National Health Service. As the noble Earl said, we should recognise the crucial importance of having a majority of members of the healthcare professions on these bodies. Therefore in a sense both of these amendments can be supported.

    I oppose Amendment No. 29. In the past I spent some time as a member of an executive council and of a family health service authority. I can still remember the rather gruesome meetings of the executive council, which were heavily dominated by healthcare professionals. It is to the credit of the previous government that they introduced a far stronger lay element into family health service authorities and other health authorities.

    Having sat through debates in those health authorities, I have seen the major contribution that lay members have made to those bodies and how they have influenced the thinking of healthcare professionals. A proper balance is necessary in those kinds of bodies if the best interests of the public are to be served. Now, many health professionals would take the view that they prefer a situation in which there is a good balance and an even spread of committed people from the lay communities who contribute to healthcare policy and its delivery at local level. We should reflect on the experience of the past 10 to 15 years, when there has been a much stronger injection of the lay element into healthcare bodies.

    I wish to make a slightly narrower point relating to the balance among professionals. Today I have received a rather angry letter from the Chartered Society of Physiotherapy, expressing disappointment that the professions allied to medicine are once again not specified in the Bill as being desirable members for trusts.

    It is relevant to remember that among those other professionals physiotherapists are experienced in community healthcare, not merely in the delivery of services at GPs' surgeries. Therefore, along with those of a similar professional background, they make a large input in terms of the improvement of community services, which is likely to become part of the responsibilities of most PCTs. The point is that it is not until the most superior stage, as it were, of the development of a PCT that it apparently becomes possible for those professions to be represented on the board. I hope that the Minister can offer some reassurance on that matter.

    I support the remarks of the noble Lord, Lord Warner. I, too, remember the Inner London Executive Council, of which I was a dental member. At least 50 per cent. of its members were professionals. The dentists were told: "Unless you vote to support the doctors, we shall vote against you". It was worse than any trade union—not that I have ever been a member of a trade union. It was as closed a shop as anything that existed. Many of the London boroughs took an active part in telling Sir Keith Joseph that, whatever happened, he must do away with that built-in majority that was so wrong. I therefore support the view that there should be a balance. No one group should have a built-in majority so that it can pressure others into supporting a proposal that they would otherwise oppose.

    I should find it easier to evaluate all these amendments if I had some idea of the size of the body of which all these people would be members. Is it possible for the Minister to give us some better indication as to the likely range of sizes? All these matters are to be included in regulations of which, as yet, we have no sight.

    On the last point, I think I can help the noble Baroness. As I said earlier, the proposals for the Government's arrangements for primary care trusts were published at the end of last week. Copies have been placed in the Library. I shall go into more detail later as I realise there has been only a short period of time for Members of the Committee to examine the proposals and the balance that we are attempting to strike in membership of the hoards and primary care trusts.

    The contributions to the debate indicate the need to strike a balance and some of the difficulties in so doing. We have heard cogently argued the reasons for maintaining a professional majority; there have been equally strong representations that a professional majority is not appropriate and that there ought, for reasons of probity and responsiveness, to be a lay majority. Later in my remarks I shall go into the detail of how we attempt to reconcile and achieve what we believe to be an appropriate balance, and also to see that there is the right balance between the professional groups and bodies concerned. Although GPs must be extremely important—and the PCG governing arrangements place GPs and nurses firmly at the forefront—when it comes to primary care trusts we are talking about a different animal, and different governance arrangements are appropriate.

    Perhaps I may deal first with Amendment No. 26 and the linked Amendment No. 30, removing the power of the Secretary of State to appoint the chairman of the PCT board and putting in place election between the members of the board. That is not an appropriate way forward. It is a well-established principle that the Secretary of State appoints the chairmen of NHS bodies. It is a way of ensuring that those bodies can be held to account by the Secretary of State. I see no reason that that should be different for primary care trusts. As with other NHS bodies, the Secretary of State will ultimately be able to dismiss the chairmen if necessary. Not to have that arrangement would mean not having a proper chain of accountability from primary care trusts upwards to the Secretary of State and, via him, ultimately to Parliament.

    We must bear in mind that each primary care trust will be responsible for large sums of money—at least £60 million. They will need to help achieve national priorities and develop and deliver local health improvement programmes. There has to be public confidence in the accountability.

    We have found that the system of chairmen being appointed by the Secretary of State and being accountable to him has worked well with other NHS bodies. There is no reason why it should not do so with primary care trusts.

    We want those trusts to be firmly rooted in their local community, and responsive to the health needs and wishes of local people. That is very much in line with existing NHS bodies. However, it is why, in selecting a chairman, the Secretary of State will consider a range of factors, including experience, knowledge and the level of confidence that is commanded by the individual within the community. That gives us some reassurance that the arrangements will provide a sensible balance between accountability upwards to the Secretary of State and the involvement of local people, not just as chairmen but as non-executive members of the trust board in running PCTs. I urge the Committee to agree that we should maintain those arrangements.

    I now deal with the issue of who should be included; who should he the lay members. I shall then come to the major issue of the balance on the board. It is important that we recognise the need to represent all sections of the community. Once we start specifying a particular group with needs, such as the elderly, who are major users of the health service, their needs are important and must be taken into account. The noble Baroness, Lady O'Cathain, pointed out that there are other users at the other end of the age scale who also need to be represented. Representing the needs of children is not easy in an automatically representative way. The noble Lord, Lord Rix, talked earlier about the possibilities of people with learning disabilities being involved in the governance of trusts that provide services for that group.

    I do not believe anyone would dissent from the broad aim of the amendment. We certainly wish lay members to be drawn from all sections of the community. However, we also want them to be not only from different age groups but also from different ethnic and racial groups and to represent different walks of life. As it stands, the provision allows lay members to be appointed who ensure that.

    At present we make the appointments in line with the principles of the Commission for Public Appointments. In doing so, we have made clear that we have been trying to increase the representation of people from the locality of the NHS body concerned. We have published goals on the appointment of women chairmen and members of NHS boards and those from ethnic minorities and that a guaranteed interview scheme is operated for people with disabilities. Those are all measures to try to ensure that we have a wide spread of people.

    Equally, there is no age limit to those who can become members. I heard what the noble Baroness said in relation to that. I have seen appointments of elderly members of the community to trusts within the department. Perhaps I could give the breakdown by age at present. Of those appointed at the moment, 7.5 per cent. are aged up to 39—not many representing the younger end of the spectrum. I remember that when I was younger I was always being asked to come onto boards because there were too many old people and they were trying to make the board younger. Pendulums swing and perhaps I shall now come into fashion in my later years to redress the balance in the other direction. Of those appointed at the moment, 66.5 per cent. are aged 40 to 59 and 26 per cent. are aged 60 and over. That is a substantial group already there.

    8.30 p.m.

    Can the Minister tell us of those aged 60 and upwards, up to what age? How many are over 70 and how many are over 75?

    Off the top of my head, no, I cannot tell the noble Baroness. I shall make inquiries but I imagine that it diminishes as we go higher up the scale. However, your Lordships' House always teaches us that the contribution people make improves with age. I am sure that the same is true within the health service.

    As regards the composition of boards in the future, on which the noble Baroness, Lady Fookes, asked for enlightenment, we envisage a board of 11 members comprising a chair and five lay members. Membership will be open to local authority elected members. The chief executive, the finance director and three professionals will he drawn from the executive. One of the professionals on the board will he the director of clinical governance and there will need to be at least one GP and one nurse on the board, who must have the confidence of the rest of the executive.

    If the chairman is a non-lay member, we envisage flexibility to appoint an extra lay person to ensure that the lay majority is maintained. It was the existence of the proposed lay majority that is challenged in Amendment No. 29. The noble Earl, Lord Howe, sought that a majority of the members should be members of a healthcare profession.

    It is absolutely right that the board should have access to proper advice from healthcare professionals and they should provide the driving force for the board. But, equally, it is important to ensure that the trust is rooted firmly in the community that it serves, that it is publicly accountable and operates with the highest standards of probity. For those reasons we believe that the board should be properly balanced and that the non-officer members should be lay people to ensure the direct involvement of the community.

    However, because we recognise that crucial role of the healthcare professionals, it is our intention to establish a trust executive which would have a clear majority of professionals who would take most of the day-to-day decisions and play a leading role in formulating policy on priorities, service developments and investment plans. Some of those professionals will then also serve as officer members on the PCT board. They will be there to guide the deliberations of the board and take part in strategic decision-making.

    However, the board, with a majority of lay members, will be responsible for the performance of the trust, probity and the involvement of the local community. The executive and the board will need to work co-operatively and closely if the primary care trust is to be successful. We believe that in these arrangements we are putting the proper balance so that there will be a professionally-led service, in accordance with the highest principles of probity and governance, and at the same time with firm ties to the views, skills and aspirations of the community that is served.

    Perhaps I may intervene to ask the Minister a question. One of the issues that has come over to me strongly in the representations made on the Bill is the extreme unhappiness of some of the professions allied to medicine in terms of their input and their ability to input as full members of a PCG board and their inability to be members of that board.

    The noble Baroness will correct me if I am wrong, but it seems that that will be carried through into tier three or the first tier of PCTs. Only when they reach the second stage of PCTs will there be a possibility of some of those professions allied to medicine which are currently excluded being included. One of the reasons for such amendments as Amendment No. 31 was to point out that the involvement of community pharmacists, physiotherapists and opticians was desirable as full board members. If there are no volunteers, obviously they will not be members of the board. But if they are active, involved members of the professions allied to medicine on a local basis who wish to take part in PCTs, why should they be excluded at the first level of PCT? Can the Minister address that point?

    I am grateful to the noble Lord. I recognise the issue that he raised. It is one that was put to me from representatives of the professions allied to medicine. I would not wish in any way to denigrate the contribution that they can make to PCTs and PCGs, without necessarily having full board membership. They may give the expertise and advice of pharmacists, physiotherapists and so on—the whole range of professions supplementary to medicine.

    Will the Minister also take this opportunity to reassure the Committee as to the reports in the press this week that the Secretary of State wishes to appoint the chief executives as well as the chairmen? Can she assure us that there is no truth in those reports? I am concerned that there should not be just a central government department appointing chief executives.

    For clarification, I was referring not only to boards but also to executives. One of the disappointing features is that one talks about professional input at executive level in the two-tier structure, but on that basis at level three (PCT) the professions allied to medicine do not get a look-in on the executive level either.

    I think I made clear that the arrangements for Secretary of State appointments related to chairmen and not chief executives. Those will be determined by the chair and lay members with input from professional members or the preceding primary care group. That takes into account the view put to us by professional groups about the importance of the chief executive commanding the confidence of the professionals. Finance director appointments will follow a similar pattern but with the chief executive also on the panel.

    It has been pointed out that the membership of the trust executive will have a professional majority. As with primary care groups, a social services officer nominated by the relevant local authority will provide some of the interface and interconnection that the noble Lord, Lord Clement-Jones, sought earlier. The balance of professional members will differ between level three PCTs (commissioning-only) and level four PCTs (commissioning and providing). That is precisely to allow scope for other professional health service staff like professions supplementary to medicine to be fully involved at level four trusts. Therefore, in the provision of community health services professionals will be able to play a full part. We have allowed for a flexible structure at that level precisely for that reason.

    As to level three, that is only a commissioning body. Where GPs have a particular role as gatekeepers and in committing resources, we believe that the argument in one of the amendments about those people being in the driving seat on the board has some weight. But when one comes to level four the Government recognise that it is absolutely essential not to neglect the role of professions supplementary to medicine. We envisage an executive of up to 10 clinicians with significant representation from general practice and a balance of local nurses and other community and public health professionals. There will, however, be some specialist tasks that may require particular professionals; for example a strategic role in respect of nursing.

    I hear very clearly the view that PCT governing board arrangements should recognise the contribution that can be made by dentists, community pharmacists, opticians, physiotherapists and others. But we feel that if we impose a straitjacket on the PCT governing board arrangements it will be inconsistent with the fact that such a body will not have particular functions in respect of FHS contractors. It is important to ensure that we consult, as appropriate, dentists, opticians and pharmacists. We do not rule out the possibility of professions supplementary to medicine, or indeed midwives as distinct nurses, from being on the board at level four. The point is that if we begin to specify separate professions we will return to the "list" problem.

    There are difficult balances to be struck between those who argue for a professional majority and for doctors to be completely in the driving seat. I point out to the noble Earl, who said that GPs were losing control of the progression towards primary care trusts, that PCGs and local NHS trusts that provide community services, or the health authority, must endorse a proposal before it can go to consultation. In practice we accept that PCGs will be the main generators of proposals. GPs are in the majority on PCGs and therefore will have a key role to play in progression towards primary care trust status. We feel that the need to balance the different elements is best met by the kind of mixed board to which we have referred with the professional executive below it.

    8.45 p.m.

    My Lords, we on these Benches are sorry that the Minister does not see fit to alter the arrangements over the appointment of chairmen given that the power of appointment of members of the PCT already lies with the Secretary of State. We feel that accountability is already there and that it would be a move towards greater democracy if chairmen were elected from among the members of the PCT. We are pleased to receive support from many Members of the Committee for these amendments, in particular Amendment No. 28 and for the other amendments that seek wider representation on the boards of PCTs.

    I echo the words of my noble friend Lord Clement-Jones that there is considerable unhappiness among the professions allied to medicine about the current arrangements proposed by the Government. There is a very strong feeling that at present they are not properly representative of the wider community. It is vital that the PCTs command the confidence not just of the professionals but the wider community that they serve. We do not ask for a straitjacket but for arrangements that are properly representative. I take encouragement from the words of the noble Baroness that she will aim to secure wider representation and I hope that that will emerge in practice. We are not convinced that there are enough safeguards written into the legislation as it stands. Therefore, for the present we shall withdraw the amendment but reserve the right to bring it and other amendments back at Report stage. I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    [ Amendments Nos. 27 to 37 not moved.]

    Page 43, line 24, after ("trust") insert ("or any other member of the trust or any person who has been a member of the trust").

    The noble Lord said: I beg to move Amendment No. 38 which is a narrow but nevertheless very important proposal. This matter, which appears to us to be somewhat anomalous, was drawn to the attention of these Benches by the BMA. If one looks at paragraph 11(3) of Schedule 1, it allows superannuation, allowance or gratuity to be paid to a primary care trust chairman or former chairman. The intention of the amendment is to spread that rather more widely. It seems to us to be rather peculiar that alone among those who serve on the board of the PCT the chairman is entitled to such superannuation, allowance or gratuity. The responsibility of board members will clearly be considerable. The prospective budget of PCTs appears to be about £60 million, so the responsibility of board members will not be inconsiderable. Therefore it is important that one considers the appropriate remuneration for members of the PCT boards. Superannuation is an important part of remuneration. Primary care groups have already been established without an appropriate level of remuneration or superannuation for board members. The BMA believes that that has been a significant disincentive to GP and wider professional involvement.

    We ask that the department look again at the issues. It may not necessitate amendment to the Bill, but perhaps the department should consider the matter again after discussion. I beg to move.

    Many Members of the Committee will have felt sympathy with the concern expressed by the noble Lord to ensure a secure retirement for those who have served the NHS in these capacities. However, I cannot accept his suggestion. It is expected that members of primary care trusts will spend up to 16 hours a month on trust business, for which they will receive appropriate remuneration. While the contribution will be of considerable benefit to the primary care trust, the Government do not feel that it would be appropriate to make provision for the payment of a pension allowance or gratuity which would be a considerable further drain on NHS resources.

    As regards pensions for chairmen of primary care trusts—this is a revelation to me—we cannot at present envisage the circumstances in which it would be appropriate to consider determining that those pensions should he paid. I think that I should declare a reverse interest. Although it has never been used, there is provision in other legislation to allow for the payment of pensions, gratuities and allowances to the chairmen and former chairmen of other NHS boards. We believe that it is right, should the need arise in the future, to maintain the capacity for chairmen of primary care trusts to be treated in the same way as all other NHS chairs. But since 1977 all other NHS chairs have never been made subject to that provision or had any pension provision made for them.

    However, there is no provision, even in theory, for the payment of such pension allowances to members and former members of other NHS boards. It would be inappropriate to introduce that for the members of PCT trusts, who would be treated differently from their colleagues on other boards, and, in reality, were the provisions to be invoked, differently from the chairmen of other boards.

    I thank the Minister for that reply. It was intriguing in many respects. The sum total of the Minister's argument is that in the current context, whatever the provisions in the Act, the payment of pensions is purely theoretical: that the department takes away with one hand and the other. Her argument also demonstrates that with quite considerable ease the Government could provide power in the Bill to pay pensions—and it would not matter. They would not pay pensioners anyway, whatever the provisions. So the permissive power would be perfectly easy to grant.

    We shall think about the matter and discuss it with those who propose the amendment. I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    I have to tell the Committee that if Amendment No. 39 is agreed to I cannot call Amendments Nos. 40 to 44 because of pre-emption.

    Page 44, line 23, leave out from ("and") to end of line 39 and insert ("details of the measures the trust has taken to promote economy, efficiency and effectiveness in using its resources for the exercise of its functions.

    (2) A Primary Care Trust shall prepare such other reports or other information as required by the Health Authority in whose area the Trust's area falls or by the Secretary of State.
    (3) A Primary Care Trust shall publish reports and information compiled under sub-paragraphs (1) and (2) at least within its area of operation.").

    The noble Lord said: This series of amendments is designed to improve the reporting requirements of primary care trusts. The amendments are designed to tighten up the provisions in the schedule. I do not think that it requires huge explanation. Effectively we are tightening up the wording, making the provision mandatory.

    Amendment No. 50 needs further elucidation, as do the amendments about best value. We have sought to insert some provisions relating to the duties on reporting on economy, efficiency and effectiveness which mirror the best value provisions under the local government legislation. We believe that the PCTs should be in no different position from local government in that respect.

    PCTs are in a peculiar position. Many professionals and lay people remark on the fact that PCTs will be both provider and commissioner. They will commission in the sense of secondary healthcare and they will provide primary healthcare. That gives them somewhat of a conflict of interests. Therefore it is important that their reporting requirements should be clear. For that reason we believe that PCTs should present to the Secretary of State an annual account of services which they commission from themselves as providers. We believe that to be a reasonable check on what is a fairly considerable degree of power. It makes sure that PCTs are properly commissioning services from themselves, so to speak. To commission from themselves is a somewhat schizophrenic duty for PCTs.

    In line with a number of our other amendments, we believe that the amendment promotes transparency and demonstrates the value more widely than is currently provided for in the Bill and is not inconsistent with current legislation.

    I speak to Amendments Nos. 40 and 42. In supporting the principle of open government, we believe that information about the work of PCTs should be made readily available to members of the public and interested organisations throughout the country. We therefore feel that it should be the responsibility of the Secretary of State to ensure that PCTs produce an annual report and that it be publicised. In that way the Secretary of State will take on additional responsibility in a similar manner to that of the DfEE in the publication of information relating to schools' performance.

    Access to relevant information is of great concern to the public; and publication should be the responsibility of the Secretary of State rather than individual PCTs. It is vital that any important information that is given to the public should be set out in a form which is accessible and easy to understand. If left to individual PCTs, there could be wide variations in the detail, quality and clarity of that information.

    In order to have reports where clear comparisons can be made between trusts in one area of the country and another, the Secretary of State should undertake to publish the information in a consistent format. We are concerned that unless that approach is adopted, real improvements in patient care, which we on this side of the Chamber seek, will be obscured by inconsistent reporting. I look forward to the Minister's comments on that point.

    On Amendment No. 42 we believe that it is important that information should be available to the public on the availability of drugs, treatments and other healthcare service treatments. This should contain, as a matter of public interest, details of whatever rationing decisions the PCT has had to make over the course of the year. First, that will be an additional step towards the acknowledgement of rationing, or prioritisation, within the health service. Secondly, it will be possible to observe whether the effects of NICE and CHIMP have been to increase the rationing process over time. Despite the Health Minister in the other place having recently made the astonishing statement that there is no rationing, a wide range of rationing decisions are currently being taken in the health service and there is a great variation from one area to another.

    We do not believe that it is possible simply to end rationing. What we do believe is that there is an urgent need for a mature debate on the subject of rationing and priorities of the health service. The Government are damaging public confidence in our healthcare system by refusing to admit to this obvious fact. It is no good—as the Government are trying to do—simply to force doctors to carry the can for rationing decisions. Doctors should always make decisions on clinical priorities, but the framework should be set in a transparent environment and the public involved in the setting of the framework.

    The Government claim that the introduction of NICE and CHIMP will alleviate the problem of regional availability. Even if that is the case, it is likely to result only in some operations or drugs being nationally available, with others becoming available in the private sector only. Having such information from PCTs set out by the Government on an annual basis will help to clarify which areas are experiencing most rationing.

    9 p.m.

    This series of amendments deals with the reporting arrangements for primary care trusts and we support their general aim to ensure that there is transparency in the activities of those trusts. We believe that it is covered by the current provisions in the Bill.

    As regards Amendment No. 39, the duties in paragraphs 16 and 17 of Schedule 1 are at least equivalent to requirements on other NHS bodies. The provisions do a number of things. First, they require the PCT to prepare and send an annual report on its activities to the local health authority and to the Secretary of State. This is consistent with the line of accountability that we want to see—and which is also reflected in the powers of direction in Clause 7—from PCT to health authority. But it also reflects the fact that PCTs are ultimately accountable to the Secretary of State. And the Secretary of State, too, will have an interest in maintaining the performance of PCTs.

    Secondly, the provision (in paragraph 16(2)) is deliberately couched in a way that will allow flexibility as to what other reports and information they can require of the PCT. This further reinforces the ability of health authorities and the Secretary of State to hold PCTs to account. Clearly, though, this power will need to be exercised judiciously so as not to impose unnecessary burdens on PCTs. And health authorities' ability to request information will be subject to the Secretary of State's direction. We want proper accountability arrangements, but not a major paper chase or excessive interference in the running of PCTs.

    Thirdly, we will set out in regulations the steps PCTs must take to publicise their accounts, annual reports and other prescribed documents. Clearly, ensuring effective publication and access to such information locally will be one of the areas we will want to consider for regulations. Equally, all NHS bodies will be required to report annually on clinical governance and that will apply equally to PCTs.

    We consider that these provisions are extensive and flexible. We believe that, if anything, the amendment dilutes rather than strengthens the requirement to publicise key documents such as audited accounts and annual reports. I hope that I have reassured the Committee that the existing provisions deal with the issue.

    Amendment No. 40 raises an important issue here about the balance between primary care trusts' powers and their duties and accountability. We want to establish primary care trusts as free-standing statutory bodies with the operational flexibility to tackle local service problems. We want primary care trusts to be innovative and make changes for the benefit of patients. However, with freedoms must come responsibility and proper accountability. Paragraphs 16 and 17 of Schedule 5A to the 1977 Act, as inserted in Schedule 1 to the Bill, are very important in this respect. They place a clear duty on primary care trusts to report on their performance to health authorities and the Secretary of State. Those two routes of accountability are very important.

    Paragraph 17 further provides for this process to be transparent and open to public scrutiny. It is our intention that primary care trusts will be required, through this provision, to publish their audited accounts, annual reports and other documents that the Secretary of State may prescribe in regulations. As it stands, paragraph 17 confers a discretion on the Secretary of State to make regulations on the publication of these specified accounts and reports. However, it is our intention to require such publication. I am grateful to noble Lords for drawing attention to this point. I am considering their amendment which will have the effect of replacing the Secretary of State's discretion to make regulations as to the requirements to publicise specified reports and accounts with a duty on the Secretary of State to do so.

    I assure the Committee that there is no ducking out of the need to impose requirements on primary care trusts in respect of publicising reports and accounts. We will take the necessary steps to ensure that that is so. However, we believe it is right that the onus to publish reports should rest firmly with the primary care trust. Placing this duty on the Secretary of State—as the noble Lord, Lord Astor, proposes—would undermine the accountability of primary care trusts. If they are to have their own powers and freedoms to exercise functions, they should also be expected to account for the performance of those functions. This is hardly a new principle—it is the way, for example, in which NHS trusts work. To accept the noble Lord's amendment would be to separate primary care trusts' responsibilities from their freedoms. We do not believe that that is a sensible way forward and we intend that the accounts and reports are published in a way that makes them accessible to interested parties locally as well as to national interests. Paragraph 17 is couched in such a way that the Secretary of State will be able to set out any necessary requirements to that end.

    Perhaps I can deal with the issue of split functions of primary care trusts with which Amendment No. 50 deals. I understand the intention of the amendment but its approach is flawed. In relation to the problem raised of role confusion, primary care trusts will not enter into service agreements or NHS contracts with themselves.

    Clause 3 inserts new provisions into the NHS Act 1977 relating to the funding and financial duties of primary care trusts. However, it is only part of the overall financial framework and associated reporting arrangements. In particular, the provisions need to be considered alongside the provisions of the new Schedule 5A to the 1977 Act as inserted by Schedule 1 to the Bill. Paragraph 16 of the schedule provides for each primary care trust to report on its activities in a form which the health authority, Secretary of State or both may specify.

    Together those two provisions address the issues about which Members of the Committee expressed concern. As I said, primary care trusts will not enter into service agreements or NHS contracts with themselves. If a trust wishes to provide a service for the population for which it is responsible, it will simply provide that service; there will not be a contract and there will not be a purchaser-provider split.

    At level four primary care trusts can either choose to provide a specific service to their population or commission that service by entering into an NHS or other contract with another body for that body to provide the service. In the sense that it is drafted in terms of commissioning, therefore, the amendment is flawed. Nevertheless, the intention is clear. We are sympathetic to the purpose of the amendment and the concerns that underlie it. The dual role of a level four primary care trust as both the commissioner and provider of services could give rise to a perceived conflict of interest, a real conflict of interest or a failure to achieve value for money. I can assure the Committee that we will be looking to primary care trusts to demonstrate value for money in any services that they provide themselves for the local population rather than commissioning another body.

    Paragraphs 16 and 17 of the new Schedule 5A will require PCTs to report annually on their activities to their health authority in a form specified by the health authority, the Secretary of State or both. Paragraph 16(2) requires in particular each primary care trust to report on the measures it has taken to promote economy, efficiency and effectiveness in using its resources. Again, I can assure the Committee that we will expect level four primary care trusts to demonstrate that they are achieving all three targets in the services which they provide directly to the local population. I hope that that will reassure the noble Lord that the issues are being covered.

    Amendment No. 42 is also a flawed amendment. In recording all treatments that have been requested by a patient, we are opening a large door and not recognising that not all requests—certainly the first requests made before discussion with a general practitioner—are for treatments which are effective or appropriate. Treatment is based on clinical need but clinicians also need to ensure that individual decisions are taken in the light of local service priorities, making sure that maximum benefit can be derived from the resources available.

    Priority setting is a necessary part of decision-making in any healthcare system. PCTs will not change that; they will not put all the responsibility on general practitioners. But they will be expected to live within their budgets, just like any other part of the NHS. Nor will PCTs change the principle that decisions about a patient's health must be taken by the clinician and the patient. They will not prevent clinicians deciding what is best for their patient—whether, for example, to prescribe drugs or refer to hospital.

    Allowing local priority setting is an important strength of the new system. It brings decision-making to a level closer to the patient so that services can be better organised to reflect their local needs and wishes. With unified budgets in PCTs they will be able to make choices about cost-effective patterns of services and be free to switch resources over time to support them. They will be free to redeploy savings to meet local needs and promote local development. Those and the other efficiency savings and the £21 billion extra resources that we are putting into the NHS over the next three years amount to a service that will be better equipped than ever before to meet clinical need.

    The practical implication of adopting the amendment as it stands will be to place a significant extra bureaucratic burden on primary care groups and raise issues of patient confidentiality in a system where I do not believe it would enhance proper accountability or the reporting back on the activities of a primary care trust. I hope, in my remarks related to the others amendments, that I have reassured Members of the Committee that such provisions are on the face of the Bill.

    In her answer to this group of amendments the Minister, quite rightly—if I may say so without sounding patronising—relied heavily on paragraph 17 of the schedule. It starts with the word "Regulations" which immediately makes my eyes open and my ears prick up. Surely to goodness, by now, with the experience of the NHS trust, the Government and the department know exactly what they want the organisations within the health service to put into their reports to publish and to publicise. Therefore, why are regulations needed?

    I think that the broad areas are clear. However, there is change in reporting and what we need to know about. Clinical governance, for example, is an innovation in the health service. It is important that we have proper and transparent reporting on clinical governance arrangements. In the same way, I believe that the broad areas to be covered will be similar to those for other NHS bodies. As has been pointed out, PCTs, particularly at level four, are a new animal. It may be appropriate to ensure that the reporting arrangements recognise that and provide for transparency in those circumstances.

    I am sure that we are quite a long way along the learning curve, but I am not sure that we are 100 per cent. there.

    9.15 p.m.

    If transparency is to mean anything, it must also be very important to be able to make comparisons between the various trusts and how they are working. Therefore, it is important, if there are to be regulations, that there is some kind of uniform format or presentation for the key factors. Otherwise, it will be extraordinarily difficult to make comparisons.

    I accept the noble Baroness's point. We need a stronger national framework against which local decision making can be assessed. The guidance that comes out of NICE, the national service framework, will be backed up with local clinical governance arrangements reporting back on how an individual institution can be compared against another. Together with the national performance assessment framework with its various criteria, we hope that that will help us to improve and to provide more consistent access to high-quality services. It will provide exactly the kind of material for real comparison that will assist local people involved in the provision of services to improve their own service as against other people's. It will also assist local communities to assess what is being done for their locality as opposed to others.

    I thank the Minister for that curate's egg of a reply, for that is, perhaps, the best description of it. There were some helpful aspects of what she said. As I understand it, the Minister undertook to re-examine the wording at the beginning of paragraph 17 of the schedule in terms of "must" versus "may". That will, to a degree, go some distance towards tightening up that paragraph.

    I also thought that her clarification on Amendment No. 50 was helpful in terms of the split function. Perhaps I am being a little churlish, but when she said that she was sympathetic to the purpose, I wonder how many parsnips that will butter. It is good to have the sympathy of the Minister on this point, but it is the concrete outcome which is important—

    I hope that the noble Lord will forgive me for intervening. There are always nuances in "sympathy" and "looking at", as we discovered earlier in the day. The point I was trying to make to the noble Lord was not that I would give him kind words but nothing in reality, but rather that we believe that the purposes to which we are sympathetic are already covered by the Bill as it stands. That is the reason for not needing the amendment.

    With the greatest respect, that reply worries me more than the original reply. If the Minister believes that it is already incorporated in the Bill, perhaps my eyesight is failing me. However, I shall look at the reply in Hansard.

    This is a problem because regulations will provide for the kind of information which is provided. However, I seek some assurance about the precise type of information without restricting flexibility. However, members of local communities will want to know what a primary care trust is obliged to provide by way of information, and in particular the type of information we were talking of as regards Amendment No. 50 in terms of their conflict of interest, which the Minister acknowledged.

    I fully accept that the amendment itself may be flawed. The intention is that people can see clearly what the trust is providing internally, so to speak, as opposed to outsourcing. That is of considerable importance. However, I do not see this in concrete terms. I can well believe that the regulations may well provide for that in due course in some shape or form, but we shall read Hansard carefully as the Minister's reply had to be something of a double-decker of a reply. We may well return to this on Report. In the meantime, I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    [ Amendments Nos. 40 to 44 not moved.]

    Page 45, line 12, at end insert—

    ("( ) An order approved by the Secretary of State shall be laid in draft before both Houses of Parliament and shall be subject to approval by resolution of each House.").

    The noble Earl said: Schedule 1(19) relates to the powers of compulsory purchase which may be vested by the Secretary of State in a primary care trust. It is a very considerable power. I do not know—perhaps the Minister can tell us—what other types of body, apart from local authorities (that is, of course, outside central Government) have that privilege conferred by statute. I doubt whether there are many. I should like to hear from the Minister a clear set of reasons why the Government feel that it is appropriate for a PCT to have that privilege.

    I fully appreciate that the Bill does not confer a blanket power to acquire land compulsorily and that any application would be subject to individual approval by the Secretary of State. I also realise that—in theory at least, if not in practice—the power is already available to NHS trusts under the 1990 Act.

    Can the Minister say under what circumstances the Secretary of State would be likely to grant approval for a purchase to be made compulsorily, if that is not too hypothetical a question? Paragraph 1 merely contains the phrase,

    "for the purposes of its functions".

    I cannot help observing that that is a bit of a joke because the Bill does not yet tell us what the functions of a primary care trust are! However, we do know that they could be very wide-ranging. The serious point is that by approving this part of Schedule 1 as it stands, we would be writing something of a blank cheque. That is why we need to hear something definitive from the Minister.

    A fear that I have heard expressed by GPs is that compulsory purchase orders could be used by a primary care trust to purchase their surgeries if they did not want to agree to the proposals put forward by the PCT about the use of that surgery. That really would represent a significant threat hanging over the heads of GPs on virtually every decision that they made in their dealings with the primary care trust. That would be extremely regrettable. For all those reasons, I felt that it was right at least to throw into the ring the possibility that there should be parliamentary scrutiny if ever the question of a CPO should arise to ensure that those CPO powers are used both sparingly and responsibly. I beg to move.

    I am bound to say that I share the doubts of the noble Earl. Compulsory purchase is used by local authorities. If, for example, a highways authority wants to purchase a piece of land for the construction of a roundabout—or a cycle path, as would be more likely these days—it may do so, but only after that has been subject to the process of a public inquiry. The local authority has to go through a long process in order to ensure that the compulsory purchase is justified and that everybody has been satisfied in that respect. I await the Minister's answer with a considerable degree of interest.

    I think perhaps I can give an answer to the Committee. I hope to give some reassurance on the fears of some of the GPs to whom the noble Earl referred. We would not expect this to be used in any way as a weapon of coercion against general practitioners or as a threat to confiscate their property. I have more difficulty in trying to envisage exactly the circumstances in which it would be necessary for these powers to be used for a primary care trust, but the clause does provide that ability to the primary care trust.

    I should like to make it clear that consideration of any PCT to go down this route should be very much a last resort. The Secretary of State would expect that any order submitted for his approval demonstrated that every other possible solution had been explored. This could include the purchase of an alternative suitable site in the usual way. As the noble Earl acknowledged, the power of compulsory purchase of land for National Health Service purposes is not new. Such a power was approved for NHS trusts in the National Health Service and Community Care Act 1990, and under that Act the Secretary of State is empowered to approve orders submitted to him by NHS trusts for the compulsory purchases of land. However, such orders approved by the Secretary of State are subject neither to affirmative resolution of your Lordships' House nor of another place.

    This Bill does not seek to alter the existing arrangements for NHS trusts but to make the same provision for primary care trusts. It is not a power that would be used lightly. The use of compulsory purchase for land for NHS purposes is extremely rare but it is considered to be a necessary fall-back power to ensure that the NHS is able, where it is essential, to ensure that services are made available on a site that best meets the needs of the local population.

    It is rare and perhaps may become even rarer now that we have set in motion other initiatives, such as health and education action zones, where partnership and working with other bodies is a key aim and where we seek to ensure that effective communications exist between all arms of local and central government. In this way primary care trusts and NHS trusts will perhaps earlier become aware of residual shared-land opportunities that can be accessed without the need for compulsory purchase. As the noble Earl pointed out, these powers are available to many government departments and to other public bodies.

    Safeguards already exist to which objections can be made and which can culminate in the holding of a public inquiry. We do not believe it is necessary to subject primary care trusts' compulsory purchase orders to additional requirements. These would be powers that we think would be very rarely used. There are the back-up safeguards in terms of reference to the Secretary of State and that it would have to be demonstrated that every other possible solution had been explored. I suggest to the Committee that we do not need another layer of safeguard.

    I am grateful to the Minister for her reply. In the circumstances, I think she has provided as much reassurance as she was able to. I therefore beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    [ Amendments Nos. 46 to 48 not moved.]

    Schedule 1 agreed to.

    Clause 3 [ Primary Care Trusts: finance]:

    [ Amendments Nos. 49 and 50 not moved.]

    Page 3, line 45, at end insert—

    ("( ) For the avoidance of doubt, notwithstanding anything contained in this section, general practitioners shall not be cash-limited in respect of any drug or treatment prescribed by them for their patients which falls within the Part II expenditure of the Primary Care Trust to which they relate.").

    The noble Lord said: This is a fairly straightforward issue. It is unashamedly a probing amendment, but it is a matter of considerable importance. We have a situation where doctors at GP level will potentially become the rationing instrument of the NHS. This could be a fairly invidious situation if the proposals for cash limiting prescribing costs goes ahead. The same issue was discussed on Second Reading and there were a number of contributors to that debate. If the national institute of clinical excellence is prescribing effectively what is best practice (which GPs and PCTs have to observe) but at the same time the drug budget of GPs is limited, the latter will become the rationers in those circumstances, especially as the year goes on.

    If there had been a proposal to cash-limit every GP in the country under the previous government, I am pretty certain that the party opposite would have had something to say about it. I am not clear in my own mind about the motives behind this proposal. I do not find the Explanatory Notes particularly informative. Indeed, the latter seems to bring it in by a side wind (on page 16), as if it were something casually dropped in from April 1999, and so on. So it is a matter of considerable concern. The phrase I used on Second Reading was that GPs risk being caught between the hammer and the anvil. I believe that rationing does take place currently and, if it does so, it should be transparent. If we are not careful, we shall build up problems for ourselves at that level where there is insufficient flexibility.

    The position at present, as I understand it, is that non-GP fundholders are not effectively cash limited. However, what can happen is that a health authority may take one of them to task after it has overrun its budget, which is perfectly proper. Indeed, explanations can be sought from GPs in those circumstances. But this is a very different proposition. Quite where the cash limits bite in terms of primary legislation and how it all works is not very transparent, hence the reason for tabling this amendment; namely, to try to flesh out precisely how it all operates. I am sure that the Minister will elucidate the position. I beg to move.

    9.30 p.m.

    I rise to express my support for the amendment. The noble Lord, Lord Clement-Jones, is absolutely correct to point out that there is doubt surrounding this matter in that neither the Bill nor the Explanatory Notes seem to indicate clearly whether the drugs budget will be cash limited. I suspect I know the answer because the Government have previously indicated that the NHS will be subject to a cap on the budget available for prescriptions. I would welcome the Minister's comments in that respect. If she says, as Ministers have said before, that no patient will be denied the drugs that they need merely because the primary care trust has run out of cash, then I should like to know how the Government intend to achieve that here.

    I hope that I can clarify the situation and explain to the noble Lord why the amendment is unnecessary. Neither the existing legislation nor this Bill provide for the prescribing costs of individual GPs or their practices to be cash limited. We have no plans to introduce cash limiting at this level. What we are trying to do, as the White Paper The New NHS explained, is to ensure that clinical and financial responsibility is aligned within health authorities at primary care group level and subsequently at primary care trust level. That will be achieved by bringing together within a unified budget the costs of hospital and community health services, GP infrastructure investment and the drugs and appliances prescribed by GPs and community nurses. That will enable individual clinicians to decide both the most appropriate treatment in individual cases in the light of clinical efficacy and costs and also to look at the whole range of provision that is available in the round rather than in separated budget streams.

    Within the overall local cash limit provided by the unified budget, primary care trusts will be able to decide how much they spend on prescribing. Individual practices will have an indicative budget for prescribing, but this will not be a cash limit. It will be a tool to assist primary care trusts in comparing the prescribing activities of their constituent practices. Many times in this Chamber we have drawn the attention of noble Lords to the wide differences that exist in prescribing patterns, and the importance of ensuring best practice in that regard.

    I recognise that in moving this amendment the noble Lord may be seeking to prevent the inclusion of overall prescribing costs within the unified budget. However, I suggest that would defeat the purpose of establishing the unified budget and introduce for prescribing a disjunction between clinical and financial responsibilities. It would destroy the integrity of the unified budget and undermine one of the key commitments in the White Paper. For those reasons I cannot support the amendment that has been put forward.

    The Minister said that there will be no restrictions in this regard at this level. At what level will the restrictions apply? Will she explain to me in simpler English what an indicative budget is? Will she tell us a little more about the unified budget? Her reply was the most unsatisfactory that I have heard all day. She appeared to be trying to imply that there will be no limit on what is spent on the health service, when every one of us knows that no nation in the world can make an absolutely unlimited commitment in this regard. Our health service is free at the point of delivery. I hope the Minister will clarify this matter a little further.

    When the Minister replies to that question, I hope that she can also answer a question for me. Doctors in Scotland have raised this matter. The funding position in this respect appears to me to be about the same there. They are concerned that if drug costs within a trust rise steeply, the money they will need to develop the infrastructure of their practices—for example, if they wish to develop new computer systems—will not be available. They fear that their practice costs—apart from drug costs—will be squeezed. Is it part of the Government's plan to make trusts and GPs do the rationing?

    I shall try to achieve greater clarity in my explanation than I obviously did earlier. I was not trying to suggest that there would be no cash limits at all for the health service. Obviously there are cash limits in terms of the budget that is allocated nationally to the health service which then filters down through health authorities and primary care trusts. There will be an overall cash limited unified budget for primary care trusts. That is quite clear. However, beyond that there is the situation—

    I am sorry to interrupt the Minister but there is a comparison here in a sense with the current situation. As I understand the position, if non-fundholding GPs overspend on their drug budgets, the health authority then passes the request for payment through to the central department which pays it. Is the Minister saying that that flexibility will not be available to PCTs because their unified budget is cash limited at that level, unlike the position with health authorities at present?

    As to what would happen if an individual PCT overspends in any one year—which I think is the circumstance to which the noble Lord is referring—there are well-established risk-sharing arrangements which provide temporary financial assistance. Those arrangements are effective and it is our intention that they would continue for PCTs. They would therefore be available to a primary care trust if it overspent on the unified budget. I hope that that solves that problem.

    Turning to the cash limited overall figure and how that then filters down in terms of drugs expenditure overall, both within the PCT and at practice level, the indicative budget is the amount which the PCT would expect a practice to spend for prescribing in that year. It is important that we have an indicative amount because that allows the practices to look at the ways in which they are managing issues like drug prescription against which they can make savings which can be ploughed back into the individual practice, as we discussed earlier.

    But an indicative amount does not represent a cash limit. Cash will be managed by the PCT as a whole by offsetting any overspend in one area with reductions elsewhere.

    As I understand it, the indicative budget does not have built-in provision for the prescribing of drugs like Viagra. I am not talking about Viagra for relaxation or pleasure, but I have known practices where it has been prescribed for someone who matches every requirement—diabetes, kidney failure, everything under the sun—and yet other partners in the practice are very concerned because that absolutely unthought of and unknown expense has arisen.

    If the drug was available more widely than just for these few really difficult cases, it would absolutely blow holes through the budget for this year, next year and every other year. What amount will be built into the indicative budget for such miracle drugs, as I suppose one could call them?

    That has to come as part of the overall budgeting which looks at developments that are likely to take place, not only for drugs but for any other extra potential demand on services. As the noble Baroness will be aware, when AIDS and HIV hit the scene, the costs at first incurred were not particularly drug costs but hospital admission costs. Later the situation developed into more of a demand on the drugs budget.

    Of course there is no absolute certainty. We are providing within a unified budget some flexibility for meeting the sorts of demands which may arise. We hope that the establishment of more national standards and the horizon scanning to be carried out by the national institute for clinical excellence with regard to when new drugs will come on to the market will be allowed to feed into the process of forward budgeting. The reason for increasing the NHS budget as much as we have is a recognition that there will be extra demands on the service and on the new services we want to provide.

    In-year indicative budgets can be varied during the year if unforeseen and new costs arise. As to risk, the PCTs will carry through their risk-sharing arrangements with other PCTs and health authorities. There will be no great difference in the problems caused by a demand which may suddenly arise—to which the noble Baronesses have rightly referred—in this set up than in any other. But there is more of an advantage in bringing them together and not artificially separating out drug costs from any other costs.

    9.45 p.m.

    I am still a little confused. It seems that two options are available here. If the unified PCT budget is set at such a level as to cope with all calls upon it for prescription medicines, it will be much too high for general purposes. If that happens, it can lead only to wastefulness because GPs will not be as cost conscious as they should be. If, on the other hand, the budget is set at an otherwise realistic level, there is a risk of the money running out. So I am not quite sure which option we should expect.

    The risk is of the indicative money rather than the real money running out. The risk is that the indicative sum is not correct. Because it is indicative it will not be certain that it is right. It is important that we have an indicative budget because we want to encourage GPs and other primary care practitioners to prescribe sensibly and cost effectively for the benefit of all patients. PCTs will monitor prescribing by their constituent practices to ensure that they are clinically effective and cost effective and that the maximum benefit to patients is obtained from the funds available. Practices will monitor their own prescribing both for financial purposes, which has been the subject of this debate, and to further clinical governance. Bad prescribing can be not just under prescribing but incorrect prescribing. Primary care trusts will be provided with a range of budgetary and performance management information to enable them to compare the performances of their practices.

    What we are doing in the form of the guidance that we are giving and the assistance that we are putting in through, for example, computer-based prescription decision support systems like PRODIGY, will encourage a responsible use of indicative budgets. But there is built-in the flexibility both between other areas of expenditure within the practice and within the primary care trust if drug costs are higher than are expected in the indicative budgets, and flexibility is also built in if the primary care trust overall overspends in terms of what can be done by the health authority to cope with that at end year.

    I thank the Minister for taking us through this area. I feel as though I have been through a seminar on NHS finance speak. I am not sure whether I should have opened the door marked "finance". Perhaps we should have had a two-hour debate on the subject.

    I welcome some of the Minister's assurances. It is rather ironic that this is an absolutely crucial aspect for PCTs and GP practices, but nowhere is it set out in the Bill. In a sense the value of this debate has been to flush out the Government's plans in that respect and to understand some of the terms which they are using. Of course at GP level it is important for GPs to be financially prudent in the way they operate their practices. PRODIGY, NICE and so on will have a major impact on their practices. I welcome the fact that they are to be indicative budgets as opposed to fixed budgets. However, there is huge faith that, because in a sense the PCT will be 50 or so GPs in total covering 100,000 patients, the swings will match the roundabouts. When it comes to the next level, when we talk about the cash-limited unified budget, will it have the flexibility to meet all those needs? Some of those issues have arisen in this debate. I cannot say that the current system as described by the Minister has any advantage over the system that pertains at present, whereby the health authority has a greater degree of flexibility, as I understand it, than the PCT will have in the future.

    I understand the difficulties of definition in terms of prescribing costs. This is a new area and there will be a change when we introduce unified budgets. We plan to bring forward at a later stage a government amendment to refine the definitions of prescribing costs that will be included in the budget of a given health authority or PCT. Perhaps at that point we may return to this issue. If it is done at an earlier point in the evening, perhaps I shall be clearer in my seminar giving. Neither the existing clauses nor the government amendment will allow cash limits to be imposed on individual GPs and their prescribing.

    I thank the Minister for that final clarification and for the confirmation that this matter will be reconsidered on a government amendment, although the form of that amendment is not clear at this stage.

    Although the unified budgets are to be cash-limited, the Minister qualified that by saying that if a body found itself with problems of overspending, there would be some mechanism that would mean that it would not suffer. It was not clear whether that was temporary and whether the overspend would eventually have to be paid back. It would be useful at a future date to clarify what that emergency mechanism would be and how paying back the overspend would be dealt with. Greater clarification by letter or in some other form to medical practitioners would be enormously helpful. If we are uncertain, let us think how much greater is the uncertainty outside this Chamber about a matter that is crucial to the welfare of GP patients. To that extent it has been valuable to open the box marked "finance". I beg leave to withdraw the amendment.

    Amendment, by leave, withdrawn.

    On Question, Whether Clause 3 shall stand part of the Bill?

    The Committee can relax. I have absolutely no intention of opposing the Question that the clause stand part of the Bill. I merely wish to ask the Minister a couple of questions about the clause.

    The first relates to the powers of the Secretary of State to earmark funds for particular purposes and to direct PCTs to apply those funds for those purposes. It is a way of ring-fencing money. Will those powers of direction have the force of law?

    Secondly, given that the new clinical governance arrangements, and particularly the guidance from NICE, will send GPs and clinicians down the desired channels, in what kinds of situation might the Secretary of State direct a PCT to use its money in a certain way? In other words, in what kinds of circumstances will priority-setting at a national level override the priorities that are set at a local level?

    My final question concerns the provisions relating to asset sales. As I understand it, the Secretary of State may give directions to primary care trusts to pay back sums to health authorities that arise from the sale of assets or other charges payable to the trust in respect of assets that it holds. Am I correct? If I am, does the Minister agree that that could create a perverse incentive? Trusts might be reluctant to make proper and efficient use of assets, knowing that any extra revenue they received could be clawed back by the health authority, which could then presumably use the money on anything that it liked.

    In response to the noble Earl's last point, I understand the issue that he raises about a perverse incentive. The clause also brings primary care trusts into the capital charging regime of the NHS and the payment of capital charges on assets owned by NHS bodies provides an incentive for efficient asset management.

    The noble Lord asked me whether when the Secretary of State makes directions under this clause they will have the force of law. Yes, they will. But the circumstances in which specific directions will be made would, I assure noble Lords, be exceptional: for example, the out of hours development fund and possibly particular funds that are allocated to deal, for example, with winter pressures over a difficult period. We would not look at those directions as a means of enforcing the national guidance on national service frameworks or the advice that came out of NICE. The mechanisms of spreading good practice, clinical governance and reporting back to the commission for health improvement are the way in which we will test how local bodies adopt national advice. It is not envisaged that these powers of direction would be used in those circumstances. There will be much more limited and focused areas where ring-fencing was considered necessary.

    Clause 3 agreed to.

    Clause 4 [ Primary Care Trusts: provision of services etc.]:

    Page 4, line 44, at end insert—

    ("( ) If a Primary Care Trust plans to make any changes in the services that it provides or arrangements it makes for the provision of goods or services to another health service body, then in preparing or reviewing any plan under this section it must consult, or seek the participation of, community health councils and voluntary organisations and members of the public who reside within Primary Care Trust areas, or any other area where people may be affected by the changes, and such other persons as the Secretary of State may direct.").

    The noble Baroness said: This amendment follows directly from our earlier amendments about consultation. If we are asking for wide consultation about the setting up of primary care trusts, it follows that any subsequent major change in the role of the primary care trust in the services it provides or the way in which it operates should also be subject to consultation. I beg to move.

    The Government's aim for an establishment process is, as I said earlier in the day, that it is locally driven, takes account of all local views and is open and transparent. We envisage such proposals as being generated locally and the decision whether or not to establish the PCT will take into account a range of views.

    When a primary care trust moves to a primary care group, with primary care trust level four status as provider of services—which clearly involves a reconfiguration of services—that primary care trust cannot be established until there has been consultation by the local health authority. I can assure the noble Baroness that the requirements for consultation currently in regulations, where there is a proposed substantial change in services, will he maintained for such changes proposed by primary care trusts after they are established.

    We also intend that where a primary care trust proposes a significant change in the provision of services for which it is responsible, there will be consultation requirements. In other words, we will ensure that the requirement now placed on health authorities in the Community Health Council Regulations 1996 to consult where there is a substantial variation in the services in their areas will also apply to changes proposed by primary care trusts after they have been established.

    I hope that that will reassure the noble Baroness that we intend t