Health and Social Care Bill

I, too, should like to speak in support of these amendments. I start by setting the PCTs in context. When the Government came to power, they inherited eight regional offices. Four years later, those offices were abolished in favour of four regional directorates. The directorates lasted for just one year and were replaced with 28 strategic health authorities. The 28 SHAs did not last long and were merged into 10 bodies. I find that quite ironic because, in 1997, there were eight regions with organisations that had very similar functions. The importance of mentioning this is that these are the bodies that are accountable for the performance management of organisations that are much lower in the hierarchy and, of course, that deliver services, so it is all of a piece. GP fundholding was scrapped nine years later; practice-based commissioning was put in its place. In 1997, the internal market had to go and was replaced in 2005 by payment by results—a purchaser/provider split by any other name. In 1998, primary care groups were formed, but they were swept aside in favour of 303 primary care trusts. Established in 2003, those trusts were merged three years later to 152. Not all PCTs merged—those in London were left as they were for political reasons. In June 2006, the PCTs were told to divest themselves of the services that they provided but, in October of the same year, because of the uproar, the Secretary of State told them that that was not, after all, her plan. Some PCTs are considerable providers. For instance, Hampshire has more than 1,000 hospital beds in addition to all the community services, such as district nursing, health visiting, physiotherapy and speech therapy. The Gloucester PCT has a provider budget of £100 million—considerably larger than the neighbouring foundation trust. If the Government are serious about commissioning, it seems sensible to encourage PCTs to divest themselves of their provider role, but the question remains: who is to manage those services and where are they to go? Is the Government’s long-term plan to divest PCTs of their provider role and, if so, where are those services to go? I have given the Minister notice of that question. In its report following an inquiry into PCTs, the Health Select Committee commented: "““The Government’s numerous announcements and subsequent retractions mean that it is still unclear what its policy is””." The committee goes on to describe the Government’s approach as ““clumsy and cavalier”” and states that PCT reform has, "““produced a flawed and incoherent policy that is ill judged in the extreme””." That is very strong language for a Select Committee with a Labour chair and majority. In giving evidence, the chairman of Basildon PCT told the committee that, "““some staff have had different employer names on their payslips five times in ten years””." The average life of a chief executive in one post is three years. I take up the point raised by the noble Lord, Lord Warner. Is it any wonder that PCTs have not fulfilled all the Government’s expectations of powerful, well informed commissioners when they are in a state of constant turmoil? Individuals are worried about their jobs, homes, mortgages, schools for their children and continuing employment opportunities. In addition, salaries are low compared with foundation trust salaries. On our first day in Grand Committee, we debated the salary level of the new chairman of the Care Quality Commission. We agreed that a salary sends a strong message about the importance of the position. The chief executive of a medium-sized PCT with a commissioning budget of £760 million and a turnover of provider services of £100 million receives a salary of £140,000. I mentioned that the foundation trust up the road with a turnover not of £100 million but of £30 million—less than one-third—receives a salary of £180,000. That is £40,000 more than the head of the neighbouring PCT who is to commission its services. What signal are we sending to PCTs, which are doing a much more complicated and difficult task? I suggest that it might be that they are less valuable, and certainly less appreciated. Several clauses cover PCTs as providers of services, as we have heard, apart from Clause 42(1)(a), which is quite opaque, using the words, ““pursuant to arrangements””—I cannot find anything else that might refer to commissioning. Is it the Minister’s interpretation that that is all that we need to meet the concerns expressed in the amendments? Whatever arrangements are made to regulate PCTs, it is of fundamental importance that they do not duplicate the performance management functions of the strategic health authorities, as the noble Lord, Lord Warner, said. I agree with him. Mark Britnell and his team are doing a splendid job in trying to introduce the World Class Commissioning programme and it would be a great pity if any proposals interfered with what he was trying to achieve. PCTs have a huge responsibility. In addition, they are effectively local monopolies, buying care in any given locality and acting on behalf of users of the service. Since they are local monopolies, there needs to be some form of comparative information and competition to drive up performance. I see a parallel with the water industry, which is also a local monopoly. There, the regulator is keen to encourage competition by ensuring that there is comparative information for him to use. In addition, I realise that, as there are two parts in our system, purchaser and provider, it is difficult for a regulator to regulate providers without seeing the other half of the equation, the purchasers—a point that has been ably illustrated by the noble Baroness, Lady Murphy. A problem in a service may well arise due to the service not being commissioned or being commissioned incorrectly in the first place, thus affecting the delivery of quality in the service. As the Bill already provides for the assessment of local authority commissioning in social care, it seems a little perverse not also to consider the assessment of healthcare commissioning. I am delighted that some enlightened authorities and PCTs are experimenting with joint commissioning, which leads to the conclusion, in my view, that joined-up regulation as mooted in these amendments is also required. I live in hope that we are pushing at an increasingly open door and that the Minister will think again and return with her own amendments.