Health Bill [HL]

I give my strong support to the spirit of the amendment. It seems to me that despite all that the noble Lord, Lord Campbell-Savours, has said, the world has moved on since we first debated the creation of foundation trusts six or more years ago. I suspect that we did not need reminding of how politically charged the issue then was, not so much between the Government and the Opposition as between the Government and their own supporters who were extremely suspicious of this new animal that Ministers were trying to foist on the NHS. Many of them could not come to terms with the idea because they did not feel confident that foundation trusts would in practice operate like NHS bodies. That was why the private income cap was inserted. It was seen as a guarantee that publicly owned hospitals could not move surreptitiously out of the NHS and into the independent sector. We have now had several years’ experience of foundation trusts and it should be clear to everybody that they are, and always have been, very firmly members of the NHS family. Monitor, as regulator, has been outstandingly successful. Trusts are only authorised to operate within very strict terms and their managerial freedoms are counterbalanced by regulatory restrictions. But the private patient income cap was always going to be a problem. Because it originated as more of a political totem than anything else, it was set up in such a way as to be completely inflexible, which was never going to make sense in the real world. At the time I remember pointing out that the cap would prevent a forward-looking, go-ahead foundation trust from investing in a piece of capital equipment that it needed to treat NHS patients but which could only be justified financially if a certain number of private patients were also to avail of it. That absurd situation persists. We now have the even more absurd situation of trusts such as those mentioned by the noble Baroness, and particularly health trusts, with low or zero private income caps being unable to implement government policy, which is the height of absurdity. The problem is not the rule but the inflexibility of the rule. Until his peroration at the end, I took the noble Lord, Lord Campbell-Savours, to be saying that there is no business case that would convince him that the rule should be relaxed. If that is his inflexible position, it is not a reasonable one and I am pleased that he slightly relented on it at the end of his speech. The amendment is not quite in the form that I would wish to see. The noble Baroness has acknowledged that, but I genuinely believe that the time has come to amend the rule. I do not say that it should be done away with altogether or that there should be unlimited scope for a foundation trust to generate private income, but where a case can be made in the interests of the NHS for a trust to earn additional private income, why should it be prevented from doing so?