Health Bill

This group comprises Amendments Nos. 87, 88 and 89, as well as the question that Clause 34 stand part of the Bill. I think that it would be helpful if, before I speak to the amendments, I gave an overview of the clause and the reasons why it should stand part. The current legislation means that, when determining chemist applications to provide NHS pharmaceutical services, primary care trusts cannot take into account any additional services that the chemist might offer. The Government committed to change this as part of our implementation of the balanced package of measures responding to the Office of Fair Trading’s report into retail pharmacy. Until recently, NHS pharmaceutical services, as defined under the National Health Service Act 1977, primarily comprised the supply of drugs, medicines and listed appliances. However, with the introduction of the new contractual framework for NHS community pharmacies in April 2005, pharmacists are required to provide other essential services, such as promoting healthy lifestyles and supporting patient self-care, linked to the dispensing of drugs. These aim to improve choice and convenience for patients and to reduce reliance on other NHS services. Sales of over-the-counter medicines and other products related to healthcare have been estimated to account for 10 per cent of the typical pharmacy’s turnover, compared with 80 per cent derived from NHS prescription business. The range of medicines available over the counter is being extended significantly. Such sales are, of course, private transactions and as such do not come under the requirements for pharmaceutical services under the National Health Service Act. None the less, they are closely related to such services, particularly in respect of the requirement on pharmacies to support patient self-care as an essential NHS service. We therefore consulted widely last summer on the proposal to enable primary care trusts to consider in their assessment of chemists’ applications what improvements they would bring to the provision of, or access to, over-the-counter medicines and other healthcare products. Expanding consideration in this way would, for the first time, capture the aspect of a chemist’s activity within the primary care trust’s overall assessment of chemists’ applications. This new provision will come into play only where a primary care trust is assessing two or more applications together at the same time, they all pass the necessary and desirable tests, but it would not be necessary or desirable to grant all of them. I should stress that the proposal is not simply about cheaper or cut-price medicines, nor will primary care trusts’ considerations in these matters be solely financial. While price can obviously be a factor, it is not—nor will it be—the prime determining factor. The proposal goes much wider. It centres on improvements in access to a wide range of health-related products, including medicines, and the support and advice available to patients to go with the supply. I consider that this fits squarely within our plans for improving healthcare delivery as set out in the White Paper, Our health, our care, our say. It offers excellent opportunities for better services that promote healthier living, independence and well-being. The National Assembly for Wales, while it did not accept the recommendation in the Office of Fair Trading report and has not introduced the regulatory reforms now in place in England, has decided to implement this proposal for NHS pharmaceutical services. The clause therefore contains equivalent provision in relation to Wales. Amendment No. 87, which has been moved by the noble Earl, Lord Howe, would remove the whole of the new subsection (2C) from Section 42. Perhaps I might gently suggest to the noble Earl that he may have gone a little further than he intended with the amendment. In proposing to remove the new subsection (2C) he would effectively remove the whole rationale for the provision, as subsection (2B) of Section 42 introduces the circumstances in which only subsection (2C) will operate. Subsection (2C) sets out the criteria which a primary care trust will use to reach a decision on competing applications. These criteria are the improvements that the applicants offer in respect of over-the-counter medicines, health products and advice. These criteria will apply only where applications satisfy the circumstances set out in subsection (2B)—that is, the applications relate to the same neighbourhood, are considered together and individually pass the control-of-entry test. The criteria in subsection (2C) are strictly defined in accordance with the Government’s intentions on implementing this proposal as part of their response to the Office of Fair Trading report, which recommended total deregulation. The criteria in subsection (2C) are deliberately designed to encourage applicants to offer improvements that will help promote self care for patients and encourage their well-being. Without this provision the primary care trust would be unable to take these into account at all, as they lie outside the scope of pharmaceutical services as defined in Section 42(2)(c) of the NHS Act 1977. Instead, the primary care trust would be forced back to the status quo of considering the central criterion of the main test only, where the grant of an application would be necessary or desirable to secure adequate provision of pharmaceutical services. By definition, that does not include supply of over-the-counter medicines, as set out here. The whole purpose of Clause 34 would be defeated by accepting the amendment. Amendments Nos. 88 and 89 in the name of the noble Baroness, Lady Barker, seek to prevent PCTs from considering what improvements applications would bring to the provision of over-the-counter medicines in these cases. Instead, they would be limited to considering the provision of advice and the range of other healthcare products, such as dressings, incontinence appliances or sunscreens only. A number of noble Lords, including the noble Baroness, Lady Barker, said that they wished to offer protection for smaller pharmacies from increased price competition. However, this clause is not simply a question of more competitive prices. It would be up to applicants to set out how they would improve access to over-the-counter products overall and the improvements they would bring to services, advice and support for patients associated with such supplies. Smaller businesses may well be more responsive to the needs of their patients locally in this respect. In the responses to the consultation we conducted last summer, most of those who commented felt that small companies would not be disadvantaged by more competitive prices as they could access larger wholesale buying groups. I stress again that this proposal is not simply about cheaper or cut-price medicines, nor will PCTs’ considerations be solely financial. While price is obviously a factor, it is not the prime determining factor, nor will it be. As I said, the proposal goes much wider. Accepting any of these amendments would prevent the Government implementing this part of our response to the Office of Fair Trading report on retail pharmacy. The amendments would deny us the opportunity we have in this legislation to improve public access to easily available over-the-counter medicines in the pharmacy setting. For these reasons we do not feel we can accept this set of amendments. In taking out this provision we would in effect reduce the capacity of primary care trusts to benefit the varying areas of social deprivation about which a number of noble Lords have expressed concern. The Bill does not favour large conglomerates, but allows PCTs to make the most appropriate decisions to meet the needs of local communities.