Health Bill [HL]

My Lords, I beg to move that the House do agree with the Commons in their Amendment 12. In doing so, I shall also speak to Commons Amendment 14. We had a full debate in the course of the Bill’s passage about the private patient cap and its impacts on the National Health Service and I thank all noble Lords for their valuable and informed contributions to our discussion. I am pleased to say that Commons Amendment 12 responds to these debates and enables a designated mental health foundation trust to earn up to 1.5 per cent of its total income from income that it derives from private charges. The new clause also contains the definition of mental health foundation trusts for this purpose. NHS foundation trusts are a growing part of the NHS. The Government are committed to ensuring that the foundation trust model becomes a dominant form of healthcare provision. We want these trusts to use their freedoms, local accountability and financial independence to innovate and improve NHS services. As noble Lords know, the intention behind the cap was to manage a potential risk that the freedoms given to foundation trusts might allow them to change their fundamental nature as NHS organisations. As the foundation trust model has evolved, it has become clear that we need to examine new ways of ensuring that the foundation trust best serves the interests of NHS patients; we absolutely accept this. At Third Reading, I announced that the Government would embark on a policy review following the outcome of the judicial review of the current legislation. However, we have brought forward that commitment and last week commenced our review by launching a call for evidence to stakeholders both inside and outside the NHS. This is due to close by the end of the year. The Government would like to see NHS patients deriving even greater benefits from NHS foundation trusts. That is the basis of our review. This is a complex and controversial issue and only by having a fundamental and inclusive review can we ensure that consensus is reached on the solution for the long term. It will also ensure that any future solution for the long term is pragmatic, workable and achieves our fundamental purpose. Our call for evidence sets out the key principles towards which we are working. NHS foundation trusts must: first and above all, prioritise and protect the interests of NHS patients; secondly, ensure income from private patient work is used for the overall benefit of the NHS; thirdly, preserve and promote the principles and values of the NHS, as now enshrined in the NHS Constitution, and achieve national standards and government policy objectives; fourthly, not undertake private patient work in such a way as to result in a detriment to services for NHS patients; and, fifthly, ensure that mechanisms are put in place to secure and demonstrate that there is no cross-subsidy of private care with public money. This is the first stage of a broader process to review the cap. The evidence that we receive will help to shape the direction that our policy review takes next year, which we expect to complete in the spring. We intend to follow this with a public consultation on proposals for reform, which would mean that legislation could be possible early in the new Parliament. Pending the outcome of the review, a compelling case has been made for one narrowly defined interim measure to address the genuine anomaly of mental health foundation trusts, all of which have caps set at zero. Mental health foundation trusts were not envisaged in 2003. This amendment addresses an unintended consequence of the legislation and one of the most commonly reported complaints about the cap. Many noble Lords and honourable Members in another place have raised this issue as a particular concern. The Government have received representations from mental health foundation trusts that say that they are unable to move forward with ideas for service development. One, for example, has said that it cannot develop novel services such as those for children with autistic spectrum disorders and acquired brain injury. This type of service provision, it says, could have national application. As the noble Baroness, Lady Meacher, observed in Grand Committee, these trusts have told their representative body that they are also prevented from supporting the Government’s well-being agenda. Some have written to us saying that they cannot enter into government-sponsored return-to-work activities with external contractors or provide specialist help for employees at risk of mental ill health, unlike non-foundation mental health trusts. Given the current climate, it has never been a more important time to invest in mental health. Mental health foundation trusts themselves have said that, for their service users, the ability to promote and deliver the well-being agenda would be very beneficial. We have listened and we are acting. By enabling the application of a cap of 1.5 per cent, Amendment 12 will give our highest-performing providers of NHS mental health provision more room to innovate and support the development of further high-quality services for the NHS. The calculation of 1.5 per cent does not purport to be an exact science; it is an acknowledgement that mental health foundation trusts need some freedom. The figure is based on the average cap for acute foundation trusts in 2008-09. I stress that this is an interim solution, which will not prejudice the review’s aim of a lasting solution for all foundation trusts. We believe that we should only do something now that is clearly defined and around which consensus can be built. As such, the focus of the interim solution should be about only mental health foundation trusts. The Government’s amendment offers a pragmatic solution to the immediate anomaly of mental health foundation trusts. Combined with the policy review that is under way, our approach will ensure a better, fairer, lasting system for all foundation trusts. I beg to move. Amendment to the Motion Moved by Moved by Baroness Meacher As an amendment to the motion that this House do agree with the Commons in their Amendment 12, to leave out "agree" and insert "disagree"." Baroness Meacher: I shall speak also to Amendment 14A, which seeks to build upon Amendment 14, moved in the other place by the Government. Amendment 14A will provide for a 1.5 per cent private patient cap for all foundation trusts with a cap below that level. As the Minister eloquently explained, the Government have accepted the need for a 1.5 per cent cap for mental health trusts. It is very difficult to see any logic in not extending that cap to all other foundation trusts. I should draw your Lordships’ attention to misprints in the amendment on the Marshalled List. A correction slip has been issued to clarify these points and we shall debate the amendment as on the amendment slip. As the Minister explained, the Government accepted the principle implied by our amendment, moved during the passage of the Bill, that there should be more rationality in the system of private patient caps and that it should be possible for foundation trusts to raise at least a little more revenue for the pressing needs of NHS patients. The significance of these matters is increasingly apparent as the results of the credit crunch and the pressure on resources in the public sector, particularly the NHS, become apparent. I applaud the Government’s decision to institute a review of the private patient cap structure, and I particularly like the principles that the Minister set out to guide that review. The aim of the review, which is taking place immediately, is to inform a policy review that will start in the new year. The only problem with this, which the Government accept, is that they will be unable to do anything about the results of the review or introduce legislation before a general election. Therefore, foundation trusts will have to stagger on with this rather ludicrous structure of private patient caps—some with 0.3 per cent, one with 30 per cent and others with 5 per cent—for the indefinite future. It is difficult to argue that that makes any sense. I welcome, of course, the Government’s amendment agreed in the other place to give mental health trusts a private patient cap of 1.5 per cent. That amendment means that mental health foundation trusts will be able to deliver additional services and, as the Minister said, employment support to benefit NHS patients. It is a good example that the cap enables positive things to be done by trusts, not only the straightforward provision of beds for private patients one might imagine. It is not like that; this issue covers all sorts of eventualities. However, I should emphasise that my purpose in moving amendments on the private patient cap has never been motivated by the needs of mental health trusts, particularly, and certainly not by the needs of the East London NHS Foundation Trust, which I chair. I put on record that that trust has no plans at present to undertake private patient work, although that would now be possible. The Foundation Trust Network has asked foundation trusts to indicate what a 1.5 per cent patient cap would mean in terms of additional revenue. It is interesting that an additional £132 million would be brought into the 55 trusts which responded for the benefit of NHS patients. It is useful to think about that funding in terms of saving jobs in the NHS. If we assume a cost of £40,000 per job, a 1.5 per cent cap for all foundation trusts could save about 7,000 jobs. It may be that a few mental health trusts will not take up the cap—in which case 7,000 would be a slight overestimate—but that would not make a huge difference. I raise the employment point because it relates to UNISON’s concerns about any change to the private patient cap, and it may be particularly interested in the idea of saving 7,000 jobs per year in the NHS in the coming period. The other benefit of the amendment is that, for the first time, there would be a level playing field for some 75 per cent of foundation trusts. The remaining 25 per cent would have a cap above that level going back to 2002-03. That will have to be settled after the general election, when and if a new Government get round to dealing with these issues. During the passage of the Bill, we discussed a number of the disadvantages of the uneven and very restrictive private patient cap. I do not wish to repeat those debates except to briefly summarise a few of these problems. The Government’s top-up policy is unworkable in foundation trusts without reform. The private patient cap makes it hard for some leading NHS providers to become foundation trusts. A mental health foundation wanted to buy out a private-sector competitor that was going out of business and whose services were, presumably, needed and could have been taken into the NHS. However, because there was no cap—although 1.5 per cent would not have covered it—that sort of initiative was simply not viable. Private patient income was the means by which one foundation trust bought leading-edge technology and equipment for the benefit of NHS as well as private patients. More trusts need that option, and that is going to be more and more pressing. The private patient income cap is threatening the development of cancer services to both NHS and other patients. Investment in laser dermatology for the benefit of NHS and private patients is being prevented by the current private patient cap. In the tight financial climate of the coming years, these restrictions on NHS services for NHS patients will only worsen. I hope the Minister will agree that this modest amendment would assist trusts to some extent while the nation waits for the results of the review and new legislation. I hope she will agree that it deserves the Government’s support. I beg to move.