Health Bill [Lords]

Public Bill Committee, 24 June 2009.

Schedule 3

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 31, in schedule 3, page 48, line 10, leave out from ‘so’ to the end of line 12.

I am pleased to be back under your chairmanship, Mr. Key. We will try to make as much progress as we managed this morning, when we rattled along.

Amendment 31 again refers to the suspension of Monitor’s executives. The Secretary of State will not be obliged to undertake a review of suspensions until three months have elapsed from the time of suspension, and the amendment would remove that obligatory delay while preserving the opportunity for review. Why was that apparently arbitrary period chosen? Given, as I have said before, that suspended non-executives are unlikely to have recourse to the courts, surely they should be allowed a review as soon as is practicably possible.

Mike O'Brien (Labour, North Warwickshire)

We wanted to allow reasonable time for investigations to take place; it is as simple as that. Investigations may be concluded more quickly, but, depending on the circumstances, they make take longer. The Secretary of State would not want to be in a position whereby he was unable properly and fairly to conduct a review of the suspension if requested to do so in an unrealistically short time.

Stephen O'Brien (Conservative, Eddisbury)

I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 184, in schedule 3, page 49, line 36, at end insert—

‘(2) The amendments made by this Schedule apply to a condition occurring at any time in the person’s appointment which satisfies the Secretary of State as a condition for suspension.’.

Here we arrive at the exciting point about paragraph 19, establishing that the changes here are retrospective in that they impact on anyone appointed at the time the Act comes into force, regardless of when they were appointed. This is a probing amendment to find out whether the legislation will operate retrospectively on grounds for a suspension that may have arisen in the past but may no longer be present, or will suspension be an option only on grounds for suspension that arise after this legislation comes into force? The related question is whether the Minister currently has any non-executives in his sights for when the provision comes into force.

Mike O'Brien (Labour, North Warwickshire)

The transitional provision in paragraph 19 as drafted ensures that the measures will apply to persons appointed at any time. This already enables us to investigate any issues or allegations about events that happened in relation to persons appointed at any time prior to the Act coming into force. In answer to the final question, I have no one in my sights at the moment.

Stephen O'Brien (Conservative, Eddisbury)

That clears up the question about the retrospective provisions, and clearly there is nobody in the Minister’s sights. The slight question that survives, which perhaps the Minister could pick up at a later point, is whether the actual grounds for suspension need to have arisen before the legislation in order not to be caught or whether they can be caught retrospectively. Does the Minister want to intervene on that point?

Mike O'Brien (Labour, North Warwickshire)

My understanding is that this enables us to deal with any issue that arises at any stage, whether retrospective or not. That seems to be the basis on which we are proceeding. If there is anything different, I will write to the hon. Gentleman.

Stephen O'Brien (Conservative, Eddisbury)

I am most grateful. I think the important point on the record is that there is a degree of retrospection that needs to be well understood by everybody who might be affected by it. On that basis, I beg to ask leave to withdraw the amendment.

Clause 21

Mike Penning (Conservative, Hemel Hempstead)

I beg to move amendment 89, in clause 21, page 24, line 16, leave out ‘requested’.

The Committee will realise that we have reached a clause that, to be frank, is controversial. There are many different views across the House about how a product that is legal in this country can be sold while, at the same time—and I say this from a personal perspective—we cut the number of people, especially the young, who take up smoking and continue to smoke.

I was a member of the Health Committee when we looked carefully at evidence relating to the legislation to ban smoking in public places. I began that evidence session feeling very sceptical about banning smoking selectively. By the end of it, on the basis of the evidence, I was a signatory, with other hon. Members of the Committee, to the idea of a total ban on smoking in public places. It is probably obvious that I have no side with the tobacco industry. I would be happy if everybody ceased smoking tomorrow morning. It would be great for their health and great for the NHS, but probably not so great for the Treasury.

With that in mind, I emphasise the term “evidence based”. I have said to the organisations lobbying brilliantly on behalf of this legislation that my concern is not that I want fewer people to smoke—particularly children—and to have access to tobacco. That is a no-brainer for everybody, I am sure. It is that I wonder whether the legislation will work and whether it is too onerous on legal organisations that sell tobacco as part of their income stream.

I also wonder whether the legislation would provide more of a driver for the black market. Currently, at least one in five cigarettes is either counterfeit or sold on the black market with no duty paid and no one taking the slightest bit of interest in the age of the person buying that product. Age is something that I believe newsagents, tobacconists and clubs should take notice of, and in most cases they do.

That said, I will not press any of the matters related to tobacco to a vote in Committee. That is a matter for the whole House to decide on. Her Majesty’s Opposition will have a free vote, so they can express their personal views. I hope that the Government take a similar view, as, to be fair, they did on the legislation to ban smoking in public, when we had a free vote.

This is a probing amendment, which deals with the prohibition of tobacco displays. I said earlier that I doubt not the Government’s intentions, which I think are honourable, but the evidence base behind the provision. It is, perhaps, a bit early to use some of the evidence that the Minister has sent out in her letters—today, for instance. That, sadly, has left no option for her to be open-minded, as we all were about the previous legislation. Instead, it is dismissive of evidence counter to that being used by the Government.

Amendment 89 seeks to provoke the debate on the statutory definition of a requested display. For people who sell tobacco on their premises, what that means is of great concern; they want to know when and if they are breaking the law. “Requested display” relates to retailers and staff as set out in the Bill, but it is very vague. It needs to be defined, I am sure the Minister will agree. It needs a bit more tweaking, even if the legislation is passed, so that people have confidence that their display is not breaking the law under new section 7B.

An individual who wants to see the legal product that they are going to buy may have a child with them in the shop. Under the clause, is it going to be illegal for them to see the product? I hate to think that we will have a situation where mums and dads who, sadly, still smoke leave Johnny or Mary outside the door unaccompanied while they go in and purchase their cigarettes. It will not always be possible for people to accompany the children while their parents are in the shop purchasing their cigarettes, which are a legal product. My point is that the parents—and the tobacconists—will be concerned about whether they are breaking the law if an under-18 is with them during that purchase. That needs to be set out and defined carefully, because, if we are not careful, people may unintentionally break the law or put their children at risk.

Someone may, for instance, ask to see a new brand at a tobacco kiosk in the middle of a large supermarket with significant footfall. If the new brand is presented to them before they purchase and a minor walks past, will that be an offence under the Bill? Under the wording at present, it appears that it will. People will commit an offence unintentionally, and the effect on the proprietor will be onerous, whether it be a large supermarket or a smaller corner shop.

There is a whole debate to be had as to whether it is physically possible for someone who is the only person working in a shop at a particular moment to know what is happening out of their eyeshot when someone asks to see a product. Shoplifting is a real problem for small businesses, and the Association of Convenience Stores asked me to look into that.

The arguments about the content of the amendment are for the Floor of the House. What I am trying to probe with my comments now is what is actually an offence in respect of a requested display. It is difficult to see from the wording of the Bill exactly what is an offence.

John Pugh (Liberal Democrat, Southport)

I thoroughly appreciate the attitude taken by Conservative Front-Bench Members on how to deal with this issue. It is such a big topic for parties, and people within parties, that it is probably best discussed largely on the Floor of the House. Therefore, fewer amendments will be put to the vote during debates in Committee. In fact, there are variations within parties and even within health teams. One of the reasons I am on this Bill is that I reduced the variation that might otherwise have occurred if other personnel had been put on it.

When the ban on smoking in public places was introduced, the argument was largely about secondary or passive smoking, and the rights of people not to be affected by other people’s smoke, but I think that there was a sub-text to it. I was well aware of a definite attempt to marginalise smoking as an activity. That is what the legislation succeeded in doing, and I do not think that it was necessarily a bad thing, but it would be more honest when people are presenting their argument to do so in precisely those terms. The more that smoking is seen as a rather strange activity that people engage in in little huddles outside buildings on cold days, the less people will smoke, the better public health will be, and the less cost there will be for the NHS.

This clause and successive clauses largely set out the possibility of regulation that is justified by the suggestion that we can stop children smoking by altering displays, or that we can stop people who have given up smoking restarting. Evidence has been amassed to that effect, but, as the hon. Gentleman just said, there is evidence moving in both directions. Frankly, some of it looks a bit flaky; at any rate, it is inconclusive.

I do not think that one buys cigarettes on impulse. Someone might walk into a service station and suddenly buy a packet of crisps, a chocolate bar or a drink they had not expected to buy, but they would not suddenly come out with cigarettes, not having previously intended to go in there for that precise purpose. I think that the public health arguments are not as honestly or as plainly put here.

That being said, the definition of “requested display” as an entity in law is a little obscure to me. I share some of the reservations of Conservative Front-Bench Members about it and would support the amendment.

Gillian Merron (Labour, Lincoln)

It is a pleasure to serve under your chairmanship, Mr. Key.

I thank hon. Members for their comments because it is helpful to probe the intent behind the clause, and certainly the considerations that have been put are useful. Perhaps I could clarify that the amendment, if passed, would allow retailers openly to display tobacco to all adults, which of course is not the intention of the Bill. It would also require shops either to create separate adult-only areas just to display tobacco or to remove tobacco displays entirely. I am seriously concerned that that would put small shops at a serious competitive disadvantage. They would be far less able to afford to create such areas, whereas supermarkets and superstores would have no such problem. Even if we put aside the competitive disadvantage, the amendment would ignore the second and important part of our policy, which has perhaps not been aired, but which is to support those who already smoke but want to quit.

Mike Penning (Conservative, Hemel Hempstead)

I completely agree with the Minister that we must make every effort to help people who want to quit smoking. May I take her back to what she said about display? I understood that the Bill’s purpose was to prevent young people from seeing tobacco advertised in a shop in a display, and then illegally purchasing it on impulse. The Minister has just said that its purpose is to prevent adults from seeing tobacco advertised in a display. That is an imbalance. Is the purpose of the legislation to prevent under-age people from smoking, or not?

Gillian Merron (Labour, Lincoln)

Of course, it is both, and we will discuss that. It is important not to ignore the second part, which is that we have a duty to support those who want to quit, but we also have a huge duty not to allow young people to be recruited into the ranks of smokers, which is what the tobacco industry wants.

A range of research studies has considered the effect of tobacco displays on people who are trying to quit. Cancer Research UK’s 2008 report—I have placed a copy in the Library— summarised some of the published papers. Based on previous research, Cancer Research UK says that display

“stimulates impulse purchases and undermines the efforts to quit.”

If hon. Members want more evidence, I refer to the youth tobacco policy survey, which was set up to measure the impact of restrictions on tobacco advertising on children in the UK. The study began in 1999 and took place five times over seven years with nearly 6,000 adolescents with an average age of 13 taking part. Several papers have been published based on the data collected. The survey showed a decreasing level of awareness of tobacco among young people where tobacco advertising has been banned.

Mike Penning (Conservative, Hemel Hempstead)

I referred at the outset of our discussion on this part of the Bill to the work of Cancer Research UK, Action on Smoking and Health and other contributory organisations that are working so hard. However, it is obvious that they will be selective about the evidence that they put forward and will choose what supports their argument. They will not choose evidence that contradicts what they are trying to do, which would be ludicrous. Quoting one side of the argument does not give a balanced view.

Advertising has been banned for a considerable time, and we do not want to go through the Formula 1 debacle at the outset of the Labour Government. The Minister is referring to evidence about advertising, which does not exist in this country, unless the display of a legal product in a shop is deemed to be advertising, in which case it is covered by existing legislation.

Gillian Merron (Labour, Lincoln)

Perhaps I may make myself clear. I was referring to studies by MacFadyen et al in 2001, who studied 15 and 16-year-olds in the north-east of England, Grant et al in 2007, and a range of others. Information is widely available, and I am happy to provide it. The Cancer Research UK report pulls together a range of surveys. I could refer to international evidence, but I thought it best to stick to UK evidence on this occasion.

I turn to the more general point about why we allow requested displays. As the hon. Gentleman rightly said, tobacco remains a legal product, and those who smoke should be able to see or handle the product before they agree to buy it. The requested display provision means that shopkeepers may show tobacco products to people who want information or who want to buy the products. However—this is the key—workability is important, and showing tobacco to one person, as the hon. Gentleman has said, may mean that others catch sight of it. I am well aware of the concerns about that. I reassure the hon. Gentleman and other members of the Committee that we will use regulations under new section 7B (3) to make sure that no offences are committed when shopkeepers are selling, or showing, tobacco to a customer and other people see it.

We are working closely with retail organisations such as the Association of Convenience Stores, the National Federation of Retail Newsagents and others—for example, the local authority co-ordinators of regulatory services—to develop practical and workable regulations, which will keep the cost of covering up displays to a minimum. It is quite appropriate for those details to be made through regulations, because we need to work through them, and work with stakeholders to develop regulations that will be both effective and workable. We need to talk to the retailers and to the trading standards officers about how the provision will work in practice and what detail should be in the regulations for consultation later this year.

The requested display provision is needed to make sure that people can see a legal product before they buy it, but it needs to be requested only to give power to those adults who want to quit smoking. I hope that with this clarification of why we need to cover up tobacco displays for everyone, and why requested displays need to be part of the Bill, that the hon. Gentleman will, as he indicated at the beginning, not press the amendment.

Mike Penning (Conservative, Hemel Hempstead)

I have listened to this short debate and suggest that the debate on Report is going to be much longer than the Minister expects. [Interruption.] From a sedentary position I hear the hon. Member for Bristol, North-West saying, “You can say that again”. Yes, that will be from both sides of the argument, to be fair, and I hope—hint, hint to the Government Whips—that there is sufficient time on the Floor of the House to have a sensible debate about the whole issue and the effects of the legislation on law-abiding citizens who are going about their lawful business. With that in mind, as I indicated at the start, I will withdraw the amendment at this stage, but will return to it on Report. I beg to ask leave to withdraw the amendment.

Clause 22

Mike Penning (Conservative, Hemel Hempstead)

I beg to move amendment 91, in clause 22, page 26, line 3, leave out ‘may’ and insert ‘shall’.

Amendment 91 would flush out more of the concerns that we, or rather I—we are on a free vote so I had better say “I”—have with the legislation. The evidence published to date, and the evidence produced by the Minister today, is insufficient to support a ban on point of sale displays. It is also clear that children use vending machines. I am not just speaking from the evidence produced by Cancer Research UK and ASH in videos showing young people going into licensed premises—close to where we are standing here today—putting coins in the machine and buying the product. In recent weeks, I, too, have seen young people come into licensed premises and purchase tobacco from vending machines. The important thing here is whether the existing legislation has been enforced correctly, because many of the premises in which I saw this taking place, and some of the premises in the recent DVD and video, were licensed premises, so those young people should not have been unaccompanied in the first place. We need to address that point.

We encourage more and more young people to come into the family-oriented pub or bistro. I am a keen supporter of the British pub industry and do everything I can to support pubs. At the same time, it is the responsibility of those running such establishments and providing vending machines to do everything that they possibly can to preclude young people from purchasing cigarettes. They clearly cannot get them from anywhere else at that time, otherwise they would not be paying such huge amounts for cigarettes through vending machines. There are myriad premises where that happens.

The legislation is already in place, and the assumption is that the proprietor and those working in a bar or a pub should be able to see the vending machine and whether a young person is approaching it. That is fine if they are serving only one man and his dog occasionally. But, in a busy, vibrant pub, which I am sure we all want our pubs to be, or a leisure facility, similar to Jarman Park in my constituency, which has myriad services from bowling to skating and swimming to nightclubs and cinemas, it is physically impossible for the administrators and owners to guarantee that every time under-18s walk to a vending machine to purchase cigarettes they can be stopped.

After considering the evidence, I have moved my position. I do not want vending machine operators to go bankrupt. I used to be a smoker, and given that it is so expensive I have no idea why anybody would buy cigarettes from a vending machine. However, it is a choice that people can make if they are over 18 and wish to purchase cigarettes. As is suggested, in a lot of places there are no alternatives.

Proprietors of public houses in particular do not want loose stock to sell across the counter. If they lose one packet of cigarettes—stolen or misappropriated by a member of staff or a customer—that is the profit margin on about two packets of cigarettes gone. They do not want that and we moved away from it some time ago. I want the vending machine manufacturers to have an opportunity to sell their legal product in such premises without young people having access to them. That can be done in numerous ways, but I do not think that it is the purpose of the Committee to stipulate to manufacturers and proprietors of vending machines how it should be done. It can be done with a token or an electronic key system, so a person has to go to the bar.

You will be surprised to hear me say this, Mr. Key, but I think that we need to look at our European friends and take guidance from them. Some 22 countries in Europe do not permit the sale of tobacco from vending machines at all. That is too draconian; it is a legal product and people should have the right to purchase it, but it should not be available to under-18s. The industry itself needs to come forward with proposals.

Patrick Hall (Labour, Bedford)

The hon. Gentleman referred to 22 European countries having banned tobacco sales from vending machines; why is this country different from others? Clearly the conclusion has been that devices to limit access by minors to tobacco products in vending machines have failed.

Mike Penning (Conservative, Hemel Hempstead)

The hon. Gentleman raises a good point. If you look at the evidence, which we are all doing, you see that when those bans were imposed there was not the technology to do it another way. I was living in some of those countries when bans came in. When I was a British soldier in Germany in the ‘70s, the vending machines were still on the streets. That had been banned in this country years before. Interestingly enough, they took them off the streets in places where the British military were only because the old 5p was the same size as the deutschmark and they were losing a fortune from British soldiers spending 15p to buy a packet of cigarettes—that is the gospel truth. Frankly, as cigarettes were 25p in the NAAFI at the time, it seemed immaterial; I think that soldiers did it for the joy of doing it.

The situation has changed, and other countries in Europe and around the world have moved to the technology that we are talking about. We have to address whether we are going to stop law-abiding businesses selling their legal product to British over-18s. If we can do that, there is no need for a total ban. If we cannot, I will be one of the signatories to the amendment on a subsequent Health Bill, but I want to give businesses the opportunity, with the technology that we have today, to keep going and sell their legal products. If they cannot do that, we may have to go down another avenue.

Andrew Slaughter (Labour, Ealing, Acton and Shepherd's Bush)

Some hon. Members had the opportunity earlier this afternoon to see the British Heart Foundation film that showed young children going into pubs and buying cigarettes. It was clear in some cases that it was done, if not with the active encouragement of the staff, with their knowledge. They clearly did not think that it was their responsibility to stop it. Even if there are safeguards, they can be got around. As the example involves machines, if the staff who are responsible for the machines do not feel any responsibility, will that not stand in the way of the safeguards the hon. Gentleman is describing?

Mike Penning (Conservative, Hemel Hempstead)

I have seen the video and think that the British Heart Foundation is doing some effective lobbying. I did not need to see it, however, because I have seen that happen in real life.

Two aspects of the hon. Gentleman’s comments must be addressed. First, it is a criminal offence to allow that to happen. If people are allowing children to purchase cigarettes, we should check whether they are also allowing them to drink, because they probably are. Such people should not have licences and should be dealt with by existing legislation, rather than by passing more legislation. Secondly, the vending machine, or a smaller version, could be behind the bar. That way, checks would have to be made. Rather than saying, “Slap! Bang! You’re out of business,” we should look at measures that were not available when most European bans came in.

We know that people do not want to ban tobacco sales altogether—we should be honest about that. I agree with the Liberal Democrat spokesman that we did not have an honest debate on the legislation on smoking in public places. Other Committee members served with me on that Public Bill Committee. Health and safety legislation was used as a back-door method to ban smoking in public places. It was not designed to preclude people from smoking, but to protect people from passive smoking in their place of employment. We should be honest about that.

Stephen O'Brien (Conservative, Eddisbury)

My hon. Friend is giving an important introduction to this broad area that will be discussed again on Report. For those of us who have both smoked and given up twice, the only thing that keeps us from starting again is the prospect of having to give up again. I started relatively late, but it is clear that vending machines are an easy source for those who are too young to buy cigarettes. At that stage, people are not fussed about whether they are getting value for money; they just want access to cigarettes.

My hon. Friend is making the important point that we should consider measures to ameliorate the problem, rather than be draconian and impact on the freedom to choose. Vending machines tend to be on the corridor on the way to the gents, which is out of sight of almost everybody. That means that people are able to get cigarettes without any kind of penalty or fear.

Mike Penning (Conservative, Hemel Hempstead)

I thank my hon. Friend. I started smoking when I was 16 years old, as did the rest of the battalion I was serving with in the British Army. Cigarettes in the Army are still almost tax-free, particularly when one is serving abroad. On the ships of the Royal Navy, people are given a quota and still encouraged to use it. Under the previous smoking legislation, we considered why we continue to allow people to smoke in prison, even though there are already so many public health risks and it is a place of work for prison officers. There are a couple of other amendments on these issues, Mr. Key, but I will not discuss them for so long.

The key is accessibility. If people are breaking the law or ignoring existing legislation, they are sure to get around this legislation as well. Such people earn money when people purchase cigarettes because they get a percentage of the profits. If people are happy to sell cigarettes to under-18s, they will do so under the counter in future, if they do not do so already. That would certainly be true in the part of Northern Ireland that I come from.

According to Government figures, one in five cigarettes sold in this country are counterfeit or sold on the black market with no duty or safety measures. Do we really want to drive that market even further before we give vending machine manufacturers and operators the opportunity to sell their products legally to people of the correct age? That is why I have put forward this proposal. I stress that I will bring the amendment back on the Floor of the House and push it to a vote.

John Pugh (Liberal Democrat, Southport)

The problem with the amendment is that it does not go far enough. The line that we will take both on Report and in Committee is that cigarette vending machines are out of order and that we support the British Heart Foundation’s attempt to eradicate them totally. Let me briefly explain why.

Cigarette vending machines are anachronistic and date back to the times when shops closed at 6 o’clock, and desperate smokers looking for a cigarette could only get them from a vending machine. On Sundays, too, it was hard to get a supply of cigarettes. As a result, the machines came into being.

Mike Penning (Conservative, Hemel Hempstead)

I apologise for taking up the hon. Gentleman’s time, but what a load of tosh. I have never heard so much rubbish in my entire life. If someone goes into any pub in this country, they are highly unlikely to be able to purchase cigarettes in any other way. To say that it is something to do with the machines being used late on a Saturday night and that they are an old-fashioned anachronism is completely wrong. Whether we like it or not, it is the only way in which cigarettes can be purchased in most premises these days. That is because of the stock issue, to which I alluded earlier.

John Pugh (Liberal Democrat, Southport)

Clearly, it would be a disincentive for people to smoke if they had to leave the premises to get cigarettes. On a personal note, my son recently gave up smoking. The most difficult situation for smokers when they have given up is after they have had a few pints and they are relaxed, so if we are looking at a measure that will prevent people from going back to smoking, banning the machines is probably the best one.

The machines are not just anachronistic, but slightly odd—after all, we do not have alcohol-dispensing machines with controls on them. There must be some reason why the Europeans, having explored the logic, have gone down the route of largely abolishing them. We were talking about flaky evidence and evidence pointing both ways, but the evidence here is entirely clear cut. The machines represent a small section of total cigarette sales, but one in six child smokers use them. There is no doubt that the evidence shows that children disproportionately use them. The evidence also shows that attempts to get round that by having token systems or monitoring and other such measures simply do not work.

We have talked about displays before. One of the great arguments for not having displays is that it will stop people from going back to smoking and it will stop children from smoking. Vending machines encourage people to go back to smoking because, in the pub, they can be found very easily. They are clearly used by children and will continue to be used no matter what controls are brought in, because children, when they want to smoke and get round legislation, are very canny at doing so.

Gillian Merron (Labour, Lincoln)

I appreciate the points that have been made, but I will answer them under the next set of amendments or on clause stand part, should debate on that.

The direct effect of amendment 91 is that it would compel the Governments of England and Wales to regulate vending machines. I can confirm that it is the intention of this Government to introduce new regulations on vending machines to ensure that under-age sales are prevented. The Department is already working with key stakeholders in the vending machine business and enforcement agencies to develop draft regulations that will allow practical, effective and cost-effective solutions to the problem. We will have the draft regulations ready for consultation as soon as we can, and we are committed to commencing them from October 2011.

I confirm that Welsh Ministers will consult with relevant health and business organisations and with members of the public in Wales before determining how detailed regulation on the sale of tobacco products from vending machines will be taken forward under their jurisdiction. The effect of the tobacco provisions in the Bill is to devolve powers on tobacco displays and vending machines to the relevant national authorities. We note that the amendment will cut across that intention, thereby imposing a legislative imperative on the Welsh Assembly Government. Under the principle of devolution, we believe it is appropriate to leave it to them to decide how and when to use their powers. I therefore hope that the hon. Member for Hemel Hempstead will not pursue the amendment.

Mike Penning (Conservative, Hemel Hempstead)

Reading through the other amendments, this is almost a stand part debate. I appreciate your leniency, Mr. Key, in allowing it to happen.

Having listened to the Minister, I think that my probing amendment has done its job. We have heard more from the Minister in the past five minutes than is written anywhere on the face of the Bill about the Government’s proposals. On the next set of amendments I shall tease out a fraction more, but I beg to ask leave to withdraw the amendment.

Robert Key (Conservative, Salisbury)

I am of the opinion that we have explored the matter fully and it will not be necessary to have a clause stand part debate.

Clause 25

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 34, in clause 25, page 28, line 6, after ‘area’, insert

‘including an assessment of local needs for the services of dispensing doctors.’.

Robert Key (Conservative, Salisbury)

With this it will be convenient to take the following: amendment 35, in clause 25, page 28, line 9, at end insert—

‘(za) placing a duty on primary care trusts to consult patients, Local Involvement Networks and members of the public on local needs for pharmaceutical services.’.

Amendment 33, in clause 25, page 28, line 16, at end insert—

‘(e) requiring the Secretary of State to implement pilot schemes for primary care trusts in carrying out pharmaceutical needs assessments before they are rolled out nationally; and for those pilot schemes to be evaluated 12 months after they commence.’.

Stephen O'Brien (Conservative, Eddisbury)

Amendment 34 would place a duty on PCTs to take into account the services of dispensing doctors in their assessment of local pharmaceutical needs. We have now moved on to the clause dealing with pharmaceutical services in England and the needs assessments as they are proposed in the Bill. Amendment 35 would ensure that patients are consulted as part of each pharmaceutical needs assessment. Amendment 33 proposes pilot schemes for PNAs.

Amendment 35 would ensure that each PNA includes patient consultation. The principal purpose of the PNA should be to enhance local pharmaceutical services for patients and ensure that the area covered by the PCT is adequately provided for. We agree with the concept of giving PCTs local control over the provision of pharmaceutical services, but we want to make sure that patient choice is enhanced rather than overruled. At present, the Bill does not make any provision for patients to express their views in the assessment—an odd omission, given that patients are the users of the services provided under a PNA. Will the Minister confirm that the regulations will make provision for patient consultation? My amendment would ensure that PCTs include the results of such a consultation in their published PNAs, so that patients can be assured that their views were taken into account. If a PCT goes against the wishes of patients, the general public will be able to see that that is the case by examining the consultation.

Accounting for the views of patients in PNAs is particularly relevant in rural areas, where pharmaceutical services are less abundant. Many patients have to travel long distances to access services, and consequently people make extensive use of dispensing doctors, so that they can combine their visit to the doctor and the collection of their medicines. There is nothing in the Bill to prevent PCTs from cutting those services. As my noble Friend Lord Howe argued in the other place, many of the pharmacy community are concerned that the current PNAs are

“disproportionately focused on cost-effectiveness and not enough on health need”.

That means that these services face a real risk of being axed.

I have already fought a real battle on the subject in my constituency—with some success, I am glad to say. It revolved to some extent around the definition of what is rural and what is associated with an urban or suburban environment. Having said that, if any sort of assessment militates against the extension of dispensing doctors, it would be a very real threat to the rural community. Amendment 34 would ensure that the services of dispensing doctors are taken into consideration in PNAs, along with the views of patients, the majority of whom want to keep the services of dispensing practices.

On the management of dispensing practices, I am sure that the Minister will come back to me with the same assurance that his colleague the Minister of State, Department of Health, the hon. Member for Corby (Phil Hope), gave in December 2008: that the Government do not intend to make any changes to the current arrangements for the dispensing of medicines to patients by GPs. However, I am slightly less inclined to trust the good will of the Government, given that they made that pledge last year before the publication of the Bill but they have clearly left a gaping hole in the legislation on that matter.

It is of more concern that the Government appear to be ignoring the wishes of NHS patients. Some 62,675 patients registered with a dispensing practice responded directly to the pharmacy White Paper consultation to express their support for no change to GP dispensing. However, the Bill makes no provision for PCTs to consider the services offered by dispensing doctors in their needs assessment. What firm and evidence-based assurance can the Minister give that patients who are registered with dispensing practices will not see those services axed by their PCTs?

It is fair to say that many of the satellite surgeries of doctors’ practices are, particularly in rural areas, cross-funded because they have a dispensing practice. Far from doctors seeking to increase the drawings from their own practice, it is cross-subsidy that enables them to have a satellite service to reach out into the more remote rural areas. The dispensing practice enables that.

Amendment 33 proposes pilot schemes, which would enable the PCT and the Government to investigate whether the local assessment of pharmaceutical needs results in adequate provision of services. It would also give PCTs a chance to experiment with the format and content of the PNA to ensure that any complications are addressed and that the assessment is wide ranging enough to be taken into account when a provider applies to the pharmaceutical list.

The Government’s own White Paper on pharmacy concedes that

“there is considerable variation in the scope, depth and breadth of PNAs”.

It also states:

“The structure of and data requirements for PCT PNAs require further review and strengthening to ensure they are an effective and robust commissioning tool which supports PCT decisions.”

Although I realise that the Government see the Bill as the occasion for review and strengthening, a pilot programme would be the opportune moment to examine and trial the content of PNAs in a practical setting. PCTs would also be able to adapt to producing more rigorous PNAs. Examples of best practice could be disseminated before the scheme is rolled out across the country.

Anne Galbraith’s 2008 review of NHS pharmaceutical contractual arrangements, which was published alongside the White Paper, made the point that

“Pharmaceutical Needs Assessments...should have a consistent structure across all PCTs and have national comparability in breadth and depth.”

One potentially negative consequence of localisation is that there will no longer be a framework for ensuring that PCTs maintain that comparability across the country. Of course, the regulations will seek to qualify the information contained in the PNA and the manner in which it is conducted. However, we have not had sight of those regulations, so we do not know the extent to which they guide PCTs on the form and content of a PNA. If the Government were to run a pilot scheme and report back to Parliament with the results in 12 months’ time, they would have a solid evidence base from which to move forward. In addition, PCTs would have increased knowledge of how best to utilise the PNA to gain the best possible access to pharmaceutical services for their patients.

John Pugh (Liberal Democrat, Southport)

I have to apologise for the fact that my hon. Friend the Member for Romsey is not here, because she is the expert on this subject and would have a great deal more to say than I have. I have no problem with the general tenor of what the Government are endeavouring to do. Public authorities have always had to strike a balance so that naked commercial interests do not dominate the pharmaceutical world. The needs of the community are paramount, and there has always been a need to structure the market publicly in some way. Anybody who has been an elected councillor or any sort of elected representative will have been lobbied at some point by a pharmacy or a dispensing physician about their position, their share of the market and the placing of other facilities close to them.

I agree with the hon. Member for Eddisbury that whatever is done needs to be properly and thoroughly evidence-based, and if it is not evidence-based everywhere, it will not be well done. It cannot be lobby-based, because there are plenty of powerful interests in the pharmaceutical world and many prosperous commercial practices that will weigh in heavily to get their way if left to their own devices. I therefore warm to the amendments because they would preserve the rights of dispensing practices, particularly in rural areas, and they make clear that the market must serve patients rather than simply appear by accident and as a result of commercial happenstance.

Mike O'Brien (Labour, North Warwickshire)

I, too, represent a rural area where dispensing doctor’s practices exist and operate, and I very much understand the concerns of some GP practices that, in order to maintain satellite practices, they sometimes have to have funding from a dispensary. Indeed, a dispensary provides a facility for local people in such communities. At the same time, there is always a concern where doctors both prescribe and dispense, and it is right to exercise caution when dealing with that. Dispensing clearly offers an income, so we need to be careful that we deal with the issue appropriately. I believe that, in most cases, doctors act with a professional integrity on which we can broadly rely. However, we need to be continually aware that individuals may not always act with such integrity; the appropriate disciplinary procedures for doctors will deal with that.

On Second Reading, the hon. Member for Eddisbury said:

“The move to pharmaceutical needs assessments is welcome.”—[Official Report, 8 June 2009; Vol. 493, c. 612.]

I am glad that he said that. I make it clear that, as we announced before Christmas, we will not change the current system for determining whether doctors can dispense to their patients. On primary care trusts in rural areas where most dispensing by doctors takes place, it is important that such services are considered within their overall assessments of needs.

It has been asked whether services by dispensing doctors could be at risk from bad PCT decisions on new applications. The current regulations already contain provisions to take into account any prejudice to existing service providers in rural areas from new applicants, and I stress that that safeguard will continue in the new regulatory system.

The clause requires PCTs to undertake and publish their assessments of pharmaceutical needs in accordance with regulations. The Department will work closely with interested parties, including NHS and contractor representatives, as well as doctors, on drafting the requirements. I announced last Thursday the formation of an advisory group for that very purpose. However, not all PCTs need to resort to the services of dispensing doctors. It is important that such services are available for the patients who use them in rural areas, but they have little relevance, if any, in non-rural PCTs across the country. We need to get the issue right, and I hope that my reassurances have been satisfactory and that the amendment will be withdrawn.

John Pugh (Liberal Democrat, Southport)

The Minister may be able to assist me. He has pointed out the obvious conflict of interest that can exist when one is both dispensing and prescribing medicines. That needs to be addressed. He has suggested that the only way in which it would be addressed is via the ethics committees of local GPs and so on. The issue will, of course, be assessed, determined and established by the PCT, but is there not provision in the legislation, particularly in relation to where a prescribing practice differs radically from what one might expect, to do things other than relying entirely on doctors’ panels judging themselves?

Mike O'Brien (Labour, North Warwickshire)

The hon. Gentleman asks whether there are other provisions in this legislation. I am not aware of any. I shall consider the matter and in due course confirm in writing whether that is the case. It is a reasonable question, and I shall write to him.

Stephen O'Brien (Conservative, Eddisbury)

The Minister seizes the point, not least because his constituency has the same characteristics of rurality, at least in part, as no doubt many of ours do. That factor has a big effect on the availability of services and access to them in relation to how the cash flows work for both doctors and dispensing operations.

I was pleased at the way in which the Minister put the Government’s case; he did not go down the same track that was used in defence in the other place by Baroness Thornton, who took issue with the proposal of pilots on the basis that it would delay the national roll-out of PNAs for at least two years. I thought that argument spurious, and I welcome the fact that the Minister did not deploy it. Given his assurance, I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 145, in clause 25, page 28, line 24, after ‘assessment’, insert—

‘(e) for appeals to the Secretary of State or a body in relation to the content of the statement made by PCTs.’.

The amendment would enable pharmaceutical services to challenge the content of the PNA. It would ensure that when a PCT was failing to reach standards in its PNA, a potential provider or other body could challenge the statement. That sort of scrutiny will help to ensure that the PNA meets a standard that allows sound decisions to be made on new applications to provide pharmaceutical services.

At the moment, the Bill does not guarantee that PNAs will contain reliable and accurate data. I cite Earl Howe, who said in Grand Committee in the other place:

“We do not know how effectively PCTs will use PNAs, especially given their record to date of disinvesting in enhanced services such as out-of-hours opening and local delivery”.—[Official Report, House of Lords, 11 March 2009; Vol. 708, c. GC477.]

I have been in touch with the pharmaceutical services negotiating committee and I pay tribute to it for its thoughts on the benefits of being able to appeal to PCTs should they carry out the PNA negligently.

It would not be appropriate for a negligent PNA to form the basis of granting applications, and I am concerned that, regardless of the PNA standard, it will still be used as the unequivocal method of determining applications. The National Pharmacy Association said:

“It should be understood that if a PNA identifies an unmet need, then there is an obligation on PCTs, under normal circumstances, to secure provision sufficient to meet that need.”

We must therefore ensure that PNAs provide a rigorous assessment of needs, and that they are kept up to scratch so as to avoid applications being granted on the basis of negligent assessments.

The adequacy of a PNA might cause concern to all those affected in cases when the PCT has been classed as poor by the world class commissioning assessment. Will the Minister clarify whether a pharmaceutical needs assessment would still be used as a basis for granting applications if the PCT that conducted it fell into the category of poor under the WCC assessment?

As the Bill stands, there is no mechanism by which applicants can question a PCT’s assessment, even if it is perceived to be negligent. Although the regulations prescribe some of the content of the PNA, what is to stop a PCT from disregarding local needs in order to prevent a particular service from succeeding in its application? I hope that the Minister will respond to that query.

Mike O'Brien (Labour, North Warwickshire)

Allowing appeal rights would be fundamentally flawed for a number of reasons. I recognise the concerns of the Pharmaceutical Services Negotiating Committee, which has raised questions, but I shall also tell the Committee of some of my concerns.

An appeals system would lead to endless appeals from dissatisfied and potentially conflicting local interests. There will always be some who take a different view, and many of them will find that their commercial or other interests are affected by an assessment. They will have many different views on how that assessment might affect them. It is therefore likely that a multiplicity of concerns would be expressed by a significant number of individuals and businesses. We do not intend to create some kind of lawyers’ charter where we can have a massive set of new bureaucracies to try and deal with it. We need to avoid that. There is always a balance to be struck between creating new bureaucracy and ensuring that people have the right to make representations. They can make their representations when the assessment is carried out. The assessment will take account of them—or not—and the outcome will be there. Constant appeals over an assessment, which could go on for years, could get expensive.

Secondly, PCTs would potentially incur huge costs defending their decisions under appeal. That is never justifiable in terms of NHS funding at the best of times, and certainly not in the current economic climate.

Thirdly, as a consequence, appeal rights could undermine the principle of pharmaceutical needs assessment as set out in the Bill. This is supposed to be a clear, robust view from the PCT. It is not supposed to be the view of others. Lots of people will have different views and commercial interests of their own, with particular views in terms of their locality or many other things. This is supposed to be an assessment carried out by those required to deploy the NHS funding as to what their priorities are.

There is a fourth objection. I am not aware of any corresponding appeal rights in respect of other strategic commissioning documents such as the joint strategic needs assessment which PCTs carry out. Where there are concerns about a final pharmaceutical needs assessment or where there are grounds to believe that the PCT has not complied with the forthcoming regulations about PNAs, we expect much more straightforward processes.

The proposed legislation already requires us—under subsection (2)(d) to proposed new section 128A—to set out in regulations the circumstances in which a PCT must carry out a new pharmaceutical needs assessment. How every assessment is determined will be a matter for those regulations. For example, it would be triggered in prescribed circumstances such as where a PCT has not complied with the forthcoming regulations which set out how a PCT is to construct its assessment. It might also be applied in circumstances where an assessment has resulted in the PCT making faulty decisions about individual applications which are then upheld on appeal.

I understand the concerns expressed on this issue and on the capacity and capability of PCTs in this area. I refer to earlier amendments under this clause and the comprehensive support programme we are putting in place for PCTs. We need to continue that work. However, I am not persuaded that in this case, the appropriate way to proceed is to create an entirely new and somewhat bureaucratic appeal process. I therefore ask the hon. Gentleman to consider whether it is appropriate to withdraw these amendments.

Stephen O'Brien (Conservative, Eddisbury)

I am grateful to the Minister for his response, as much to me as it is to the Pharmaceutical Services Negotiating Committee and others, who I am sure he has had representations from. In effect, that was the response to the position that has been put forward.

In light of what the Minister said I am not minded to press the point—not least because I am equally anxious to ensure that we do not introduce any further levels of bureaucracy; he knows I am genuinely concerned about that. However, at the same time there is the issue about ensuring that there is not just a simple draconian process which means that some people’s interests could be cut off rather than pursued. If there were some perverse experiences over a couple of years, representations would flow into Government to suggest that there might be a need for some form of appeal. However, on that basis, I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 135, in clause 25, page 28, line 24, at end insert—

‘(e) as to differing assessment criteria for urban and rural needs.’.

This is very much linked to the subject matter of our debate on the first group of amendments under this clause. It should be recognised that patients in rural areas may have needs that differ from those of patients living in towns and cities. The amendment seeks to serve that purpose. The area of a PCT may well span both urban and rural geographies. There is no guarantee that it will take into account both areas. We need to ensure that a PCT’s PNA acknowledges the potential requirement for different services among different populations.

As I discussed under the earlier group of amendments, patients in the country make extensive use of dispensing doctors, as do the elderly, who appreciate the convenience of being able to combine the collection of medicines and their visit to the doctor without the burden of an extra trip to the pharmacy. The Minister identified precisely that service on behalf of some of his constituents.

I must express an interest in the issue, as 24 per cent. of England’s dispensing practices are in Western Cheshire PCT—the main PCT of my constituency—and a further 13 per cent. are in Central and Eastern Cheshire PCT, the other one that serves my constituents. Cheshire GP Dr. Nigel O’Callaghan—himself a dispensing doctor—recently outlined the crux of the matter on the Chemist and Druggist website by saying:

“Why not let patients vote with their feet and choose between GPs and Chemists?”

The Dispensing Doctors Association similarly observed in its meeting with me that patient choice was at risk of being restricted if appropriate safeguards were not put in place to maintain a variety of services.

Having not seen the regulations for PNAs, I can only judge the assessments on their track record to date, which, as I have already discussed, is poor in places and far from consistent. It is a worry that once again, the Government may be jeopardising patient choice in rural areas by not ensuring in primary legislation that PNAs cover a breadth of services, of views, including those of patients, and of patient choice. We support PNAs, but they must not limit choice as that defies their objective. I therefore hope that the Minister is able to guarantee that the PNAs will provide for rural and urban populations in their PCTs.

Mike O'Brien (Labour, North Warwickshire)

There are many different criteria by which assessments will need to be made. The first is, of course, the rural-urban one, but “urban” is not a single category—it deploys many different kinds of urban areas. There are inner cities and suburban areas. There are different ways in which categorisation can take place. Remember that the criteria of choice and access are different. The hon. Gentleman seems to propose that we should, in some way, create a two-tier assessment system, which discriminates in the criteria to be adopted between rural and non-rural areas. I do not think that that is the right approach to take.

Further, regulating to differentiate between the criteria to be adopted risks imposing on PCTs criteria that may not match their assessment of the needs locally—or worse, risks omitting criteria that are crucial to PCTs locally, of which we know nothing at the centre. In our view, PCTs are better able to differentiate for themselves the mix of cities, smaller towns, villages and remote rural areas, and are better able to locally reflect the way in which they feel it is appropriate to do the assessment, rather than seeking to impose—as the Opposition now seek to do—central top-down criteria, by which they tell PCTs what to do. Let the PCTs get on with it and do it themselves. Do not apply this bureaucratic centralisation on them. I say to the hon. Gentleman that I think it is time he withdrew the bureaucratic and unnecessary amendment.

Stephen O'Brien (Conservative, Eddisbury)

I think we have reached a point in this Committee where just because the Minister says it, it does not mean that it is. On this particular issue, I do not think that it invokes a high degree of bureaucracy in quite the way he seeks to tease. The main point is to emphasise the need to make an assessment that takes fully into account the difference between rural and urban. I accept that to some degree there is difficulty with the rather all-embracing word “urban”, which can include not only suburban, but even associated villages with an urban centre. I think of the villages that immediately surround Chester; they are only as far from the main part of the outer edges of Chester-urban as they are from the next village, which under the current criteria, is counted in the rural area.

Indeed, such matters lay at the heart of a dispute that was eventually happily resolved, but not until a long and tense campaign had been fought to get the local PCT to recognise the value of a dispensing doctor in the rural area. That doctor was funding a satellite operation in a village close to the edge of where a village would be regarded as being connected with an urban, not rural, environment. As a sign of our earnest approach to the matter and to make sure that we put it on the record how important we consider such matters to be, I wish to press the amendment to a Division.

The issue is something to which we shall necessarily have to return for reassurances, but I drafted the amendment to gain a guarantee from the Minister that pharmaceutical needs assessments will apply to rural and urban populations. Even given his qualification about the imperfection of the word “urban”, it is a useful point by which to demonstrate the determination on the part of the Committee not to let that little aspect of the Bill rest and to show that it has large consequences for many of our constituents, not least those who live in combined rural, urban and semi-urban areas.

Clause 26

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 175, in clause 26, page 28, line 37, at beginning insert ‘pharmaceutical’.

Robert Key (Conservative, Salisbury)

With this it will be convenient to discuss amendment 176, in clause 26, page 28, line 37, after first ‘the’, insert ‘pharmaceutical’.

Stephen O'Brien (Conservative, Eddisbury)

After the excitement of a Division in which so many of my hopes were dashed by the votes cast, by way of introduction clause 26 changes how applicants seeking to provide pharmaceutical services gain entry to a PCT’s pharmaceutical list. The Bill proposes that local PCTs should use their pharmaceutical needs assessment to determine entrance to the list. Before this legislation the Government operated a “control of entry” policy whereby the number of pharmaceutical services was determined centrally.

Amendments 175 and 176, grouped together, may appear to the naked eye to be a technicality, but they raise the pertinent question of whether a PCT can grant applications to provide services from privately arranged services or aspirational services that the PCT is not in a position to commission. “Services” does not exclude those categories of applicants and there is a danger that, if they can prove that they meet some or all of the needs included in the PNA, the PCT will be duty-bound to grant the application.

While the regulations for PNAs will set out the minimum information that must be included in the needs assessment, there will be no statutory limit on the inclusion of other matters. If a PCT’s needs assessment referred to matters other than pharmaceutical services, and an applicant undertook to provide some or all of those other services, the PCT could be forced to grant the application. While there exists a clear definition of “pharmaceutical services” in the National Health Service Act 2006, there is no such definition for “services”. Clause 126(8) states:

“The services provided under this section are, together with additional pharmaceutical services provided in accordance with a direction under section 127, referred to in this Act as ‘pharmaceutical services’.”

As the maintenance of a list is part of the arrangements for the provision of pharmaceutical services, the PCT should be required to grant the applications only if the services that the applicant is undertaking to provide, and that are included in the needs assessment, are “pharmaceutical services”.

That is not to say that pharmaceutical services cannot apply to the list with a view to providing extra services, such as the smoking cessation clinics and extended hours options mentioned in the explanatory notes. We are keen for the role of pharmacies to be expanded, so that the public can benefit more extensively from the skills of our pharmacists across the country. In fact, the Pharmaceutical Services (Advanced and Enhanced Services) (England) Directions 2005 define “pharmaceutical services” as covering the medicines use review service—our advanced service—and the locally commissioned enhanced services, which would include smoking cessation services, the supplementary prescriber service and the prescriber support service.

The Pharmaceutical Services Negotiating Committee has helpfully provided some examples of how PNAs could have an unintended effect on local services. I shall briefly touch upon one of those illustrations—I dare say that the Minister has also had the benefit of what the PSNC has provided to the Committee and to the Department.

There are many excellent private services used by the public, such as the Lloyds pharmacy service, which caters for men attending football matches. It enables a hard-to-reach group to gain access to health-care and lifestyle advice—interestingly, the topic was raised in Health questions this afternoon. However, if the PCT inadvertently said that it would aspire to provide such a service in its area when a service specification is prepared and the funding is available, then an applicant might apply and offer to provide that as a private service. Since it is mentioned in the PNA as a gap in provision, the PCT may, under sections 129(2)(c) and 129(2A) be duty-bound to grant the application. The service is granted by the PCT but out of its control, as there may not exist an NHS service specification for the service. It can neither halt the service nor control its quality.

One other example may help. A home help service may be commissioned locally but it is commissioned by social care and not by the PCT. If the PCT stated in its PNA that a high proportion of people in its area are housebound and that those people may have difficulty in accessing pharmacies, that could raise concerns about the extent to which social services commission home help. A new applicant could then apply to provide such a service, citing the PNA as evidence of the local need. The PCT could again be obliged to grant the application under section 129(2)(a) and (c) of the National Health Service Act 2006, even though it is not in a position to commission the service and despite the fact that it has no control over that part of the service.

The amendment betrays the need for clear guidance in regulations concerning the content of the PNAs. I hope that the Minister is considering these issues as he drafts the regulations. By limiting the services whose applications can be granted through PNAs to those services that seek to provide essential services, advanced services and enhanced services that are lacking in an area, we can avoid situations of the sort that I have outlined.

To demonstrate the range of services that would be provided under these terms, all of the following services come under the category of pharmaceutical services in the 2006 Act: care home services, out-of-hours services, medication review services, schools services, and screening. That list is in no way exhaustive.

I hope the Minister will acknowledge that the PNAs should be driven by the need to provide a service that is formally absent and that, as the Bill is drafted, there is too much wriggle room for PNAs to be exploited.

Mike O'Brien (Labour, North Warwickshire)

The amendments appear to be fairly straightforward and they look innocuous. However, by insertion of the word “pharmaceutical” they would limit artificially the ability of PCTs to carry out the duties that we want them to carry out.

Clause 26 replaces the current provisions in the 2006 Act that govern whether or not an applicant can provide NHS pharmaceutical services. For the last 20 years or so, that has been determined by the regulatory system known as “control of entry”. An application will succeed only if a PCT considers it necessary or expedient to grant it, in order to secure adequate provision of NHS drugs services locally. Over the years, that test has been subject to considerable review by the courts.

The “control of entry” provisions are set out in section 129 of the 2006 Act. Clause 26 of the Bill amends that section to enable PCTs to determine whether a new prospective provider will be admitted to a PCT’s drug list or an existing listing would be amended, by reference to or determined against its PNA.

Opposition Members argue that these amendments would clarify the working of that particular provision. I understand that they have the support of the Pharmaceutical Services Negotiating Committee, as they have indicated. However, although the amendments appear to be sensible, the new powers will only ever be exercised in relation to an assessment of pharmaceutical needs and the services that are then offered.

I am not persuaded that we need to say how the new powers will work in practice. The primary intention of the clause is that the applications will be determined by reference to pharmaceutical services and not by reference to some other services. We have already established in our debate on clause 25 that PCTs will be required to assess needs for particular pharmaceutical services in their area. The provisions in clause 26 are directly related back to clause 25, so in our view it will not be possible for a PCT to determine an application under clause 26 unless the services provided are pharmaceutical services, as defined under the 2006 Act.

I might add that the current wording in the 2006 Act, which the new subsection replaces, makes no mention of the word “pharmaceutical”, nor has the absence of that word caused problems for the courts in determining the regulations that flow from these powers. Therefore, I see no advantage in inserting words that the courts will have to assess, to see whether they have a meaning that goes beyond the court cases that have already examined this issue and lay out a very clear set of criteria that need to be applied. In other words, all that the amendments would succeed in doing is muddying the water for the courts. As a result, they would muddy the water for pharmaceutical services and ensure that the NHS has to go through a series of new court cases to determine exactly what these new words mean, because, in the view of any court, they would not have been inserted unless they were meant to bring about a change.

Stephen O'Brien (Conservative, Eddisbury)

The Minister makes a powerful point. The courts would, through statutory interpretation of rules, inevitably regard inserting a word as having a genuine intent, and therefore intended consequences. I fully appreciate that argument. To some degree it is helpful that the Minister has put on the record that the provision ties back to clause 25.

That said, the PSNC has clearly demonstrated concerns, and the Minister will have been briefed about them as well. I know that he has sought to address them. Having researched the matter, it is interesting to note, even without the addition of the word “pharmaceutical”, the breadth of services that are established by law in the phrase in the Bill. That is accepted. As the Minister rightly says, there is a wide amount of case law and interpretative law—that is the nearest we get in this country to administrative law, which would be more familiar to those who practise law on the continent—so effectively, there has been an interpretation already, so I buy the Minister’s argument.

However, the intention of the amendment is by no means to muddy the waters. That would not be helpful in any circumstances. Equally, it would be wrong to press the amendment to a Division, given that I suspect this exchange will be re-examined by the PSNC. If it wants to make any further points, I am sure that we will be briefed in advance of Report. Rather than press the amendment to a Division, I leave open the option to raise any issues that the PSNC feels have not been dealt with satisfactorily on Report, and I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 147, in clause 26, page 29, line 5, after ‘application’, insert

‘including a duty for Primary Care Trusts to consult patients on the decision to grant the application’.

I admire your ability to sound as though you enthusiastically welcome the arrival of amendment 147, Mr. Key.

Robert Key (Conservative, Salisbury)

I do indeed, Mr. O’Brien.

Stephen O'Brien (Conservative, Eddisbury)

That gave me a chance to find the right page.

I am pleased to say that I need not spend too long speaking to this amendment. I am simply reiterating the case I made when speaking to amendments 33, 35 and 34 in relation to clause 25, when I outlined the need for patient consultation in PNAs. I am merely seeking an assurance from the Minister that the manner in which the PCT determines whether to grant an application to the pharmaceutical list will, under regulations, take account of the views of patients. Will the Minister confirm that the regulations on local decisions concerning applications will contain provision for patient consultation?

I am sure that I do not need to reiterate in full the reasons why patient consultation is necessary. To summarise, I can put them into three brief points. First, PNAs should be for the benefit of patients and not focused on cost-effectiveness. Patient consultation will ensure that PCTs acknowledge the reason for the PNA.

Secondly, patients are often best placed to identify local needs for services and can offer valuable insights into the services that work and those that do not. Perhaps this is a good point at which to raise demographics. When there is an ageing population in an area, mobility could be a pertinent issue, even if the area is not rural. Right hon. and hon. Members on both sides of the House have such demographics in their constituencies and have raised those issues.

Thirdly, consultation will help to safeguard services that are used and preferred by patients, so PCTs will be less inclined to cut popular services.

Mike O'Brien (Labour, North Warwickshire)

Under the 2005 NHS pharmacy regulations, patient and other local community interest groups are already notified of applications and have the right to make representations to the PCT. I have no plans to change those rules. They ought to have been consulted already.

Stephen O'Brien (Conservative, Eddisbury)

Such a brief reply makes me think that perhaps I need to be slightly cautious before I roll over humbly yet again. We need to bear in mind what we truly mean by the word “consultation”. Allow me to explain as best I can: in a previous life, I had to tackle the European works councils. The right to consultation in the United Kingdom applied only to those with operations right across European Community member states, which the company that I partly ran had. Interestingly, in every language other than English, and by almost every worker representative, whatever European country they came from, consultation was regarded as a right to attend a forum for an exchange of views—after which they could take the wife for a jolly good jolly in some beautiful part of Europe. However, they absolutely respected management’s right to make the final decisions.

Only those who represented people in this country were not satisfied with that. To them, consultation meant the need to identify their influence in a decision and the final output. They wanted to know that they had made a difference and that the initial management proposals were amended accordingly. The way in which consultation is used is quite interesting. If we are following the continental European model, the Minister’s answer was perfectly satisfactory, but if we are using the definition traditional in this country, it was probably less than satisfactory. On this occasion, I shall assume that he was being a good European and, therefore, I beg to ask leave to withdraw the amendment.

Robert Key (Conservative, Salisbury)

Now we come to the one that we have been waiting for—amendment 36.

Stephen O'Brien (Conservative, Eddisbury)

I am very pleased that you, Mr. Key, have been waiting for it. I did not have quite that much enthusiasm—but now I do!

I beg to move amendment 36, in clause 26, page 29, line 5, at end insert—

‘(aa) the terms by which an applicant to the pharmaceutical list is deemed to be compliant with the adoption of a computer system accredited with the Electronic Prescription Service.’.

I wish to probe the Government about measures taken to ensure that pharmaceutical services granted under the PNAs are compliant with the electronic prescription service. The Minister will be aware that I have become, contrary to my normal inclination, something of an anorak when it comes to IT and anything relating to electronic aspects of the NHS. Before I turn to the amendment, allow me briefly to inform Committee members unfamiliar with the EPS of the background to the initiative—it is really very significant.

GPs were producing electronic prescriptions in primary care years before the Government launched their EPS. Primary care systems even had the capacity to pick up prescribing errors and report them to staff. Currently, GPs enter the prescription into the patient’s electronic medical record, when an alert will notify them of any prescribing errors. The prescription is then printed on paper and taken to the pharmacy by the patient. The EPS will make this transfer to the pharmacy electronic, which will bring about administrative, but not clinical—that point needs emphasising—benefits to the NHS. Why, then, is it so long overdue? If the software that it intends to provide offers a relatively simple functionality, I simply do not understand why it is not being delivered to schedule.

On 23 March 2009, EPS was being used for only 24 per cent. of daily prescription messages, with only 6,440 GP practices actively using the service. Furthermore, since only Release 1 has been implemented, the prescriptions require a paper version to be issued, thus completely undermining the purpose of the system and the intended administrative benefits. That is not to mention the fact that the EPS is part of the national programme for IT, which is four years behind schedule and destined to exceed its £12 billion budget. The Minister will be aware of the context to all this. If the Government could not be relied upon to implement the EPS on time, a big question remains about their record, intent and competence in implementing the rest of the national IT programme.

It is a case not just of delayed results, but of wrongly allocated resources. It is difficult to see what direct clinical benefit to patient care the EPS will bring to primary care, as it performs only an administrative function. My amendment would help to abate some of the delays facing the EPS, should the Government push ahead with the completion of the programme. I want to raise through it the pertinent issue of EPS compatibility as a factor for the pharmaceutical needs assessment to consider. In order to deliver the functionality proposed under the EPS, GP and pharmacy systems have to undergo accreditation to ensure that they are compatible. If the PNA considered the compatibility of pharmaceutical systems before applications to provide services were granted, it could save time and money spent on upgrading incompatible systems to comply with the EPS.

I hope the Minister will concede that, if PNAs do not take into account EPS compatibility, more money could be wasted on making pharmacy systems compliant. Presently, there is nothing in the Bill to prevent a PCT from granting applications from services that do not have the capacity to link up to the EPS. One might regard that as obvious—and the failure to do so as patently crass.

If PCTs are given the appropriate tools to assess whether a pharmaceutical service could comply with the EPS, the regulations for the PNAs could include EPS compatibility as a condition for granting an application. I know the Minister has become slightly fond of this response during our exchanges, but I hope he realises that the intention is to get a net gain from bureaucracy, and above all to ensure a sense that the centre—top-down, if he wants to throw that point at me again—can help facilitate best practice. However, responsibility and implementation is situated locally, and in the procuring and commissioning process.

This approach would no doubt speed up the roll-out of the EPS programme at the pharmacy end—I would be first to cheer that—as it would incentivise applicants to adopt a compliant computer system before applying to provide a service. Is the Minister willing to consider that option? I hope so, and that on this occasion he will accept the amendment.

Mike O'Brien (Labour, North Warwickshire)

I am grateful to the hon. Gentleman for raising this issue in such detail. The EPS system would mean that PCTs need to be satisfied that an application is EPS-compliant when considering whether it would be granted on the basis that it secures improvements or provides better access to pharmaceutical services—at least, that is the intention of the amendment.

I do not accept that the amendment would be helpful or particularly improve the available services. Let me take a few moments to explain the background information to the EPS. I am grateful to the hon. Gentleman for the points he has made, but to use the EPS, pharmacy contractors must have IT systems that have gone through Connecting for Health’s rigorous assurance process. Connecting for Health leads on the delivery of the national programme for IT, and its assurance process is made up of a number of key stages, including clinical safety testing and initial implementation in limited numbers of GP and pharmacy sites. Patient safety is obviously paramount. We do not want suppliers to cut corners in order to reach the start of the assurance process faster, only to lose time in the longer term as they fail to meet Connecting for Health’s exacting standards.

Authority to deploy Release 1 and Release 2 of the EPS is given separately. While much progress has been made on deploying across the country Release 1 of the EPS, which releases technical infrastructure, I know that Release 2 will be of greater interest as it brings a number of functional changes and associated benefits for patients, prescribers and dispensers. Those include the option for patients to select or nominate a dispenser for their electronic prescription to be sent to their chemist and electronic repeat dispensing produced. [Interruption.] Just a moment—let me run through some of the benefits.

What are the benefits of Release 2 for patients? The first benefit is a more convenient service, with a reduction in trips to the GP practice just to collect a paper prescription—a point particularly relevant to patients on repeat medication. Some 70 per cent. of prescriptions nationally are issued for repeat medication. The second benefit is greater freedom of choice, making it simpler for patients to use a pharmacist convenient to them. The third benefit is potentially reducing pharmacy waiting times, as, with a phone call, prescriptions can be prepared in advance of a patient arriving. In effect, the information is already there, and they do not have to wait for the piece of paper.

However, what are the benefits for GPs and pharmacies? First, there will be a reduction in the work load in GPs’ practices generated by patients collecting individual prescriptions from surgeries, particularly repeat prescriptions. Secondly, the ability to sign prescriptions electronically is much more efficient for GPs. Thirdly, GPs will be able to cancel prescriptions electronically at any point until they are dispensed, leading to greater confidence in GPs to use repeat dispensing. Fourthly, there will be a reduction in the need for pharmacy staff to re-key prescription information into pharmacy systems, which is quite a problem in bureaucracy terms—I had to get that point in. In time, this will remove the need for pharmacy staff to collect prescriptions where they offer a prescription collection service. Those developments provide significant benefits.

Stephen O'Brien (Conservative, Eddisbury)

I appreciate the list of benefits, but what is interesting in the Minister’s answer so far is that he accepts that we have only managed to get to Release 1 implementation at this stage, and he was relying on where we will get to with Release 2. That said, if Release 2 delivers to that degree and soon, that is a partial answer. Given the track record to date of the progress of the programme’s delivery and implementation, particularly Release 2, the Minister might at least want to think about—this could be a compromise—postponing implementation of this element until after Release 2 has taken place and proven itself.

Mike O'Brien (Labour, North Warwickshire)

Much progress has been made on delivering Release 1 against the background of competing priorities for IT systems suppliers. EPS Release 1 deployment is virtually complete. All GP and pharmacy suppliers have completed the compliance process. The cumulative prescription volume is 207,195,907 as of 11 June—a relatively up-to-date figure. Some 95 per cent. of GP services are technically enabled to deploy the EPS, and 80 per cent. of GP practices are business-enabled. Some 92 per cent. of community pharmacies are technically enabled to deploy the EPS, and 82 per cent. are business-enabled.

On Release 2, all central components have been delivered. There are eight pharmacy systems suppliers delivering nine pharmacy systems for community pharmacies in England. Currently, seven pharmacy systems suppliers are developing EPS Release 2 systems. Initial implementation commissioning is under way at a GP and independent pharmacy, using synthetic patients to conduct technical and clinical assurance activities. We expect nearly all suppliers to have full roll-out approval by the end of 2009, according to the information given to us by systems suppliers.

Quite a lot of progress has therefore been made on Release 2, and we need to continue to monitor it with great care. We know that deploying any computer system has its problems. Over the years, Governments of all persuasions have found that computer systems can cause difficulties. That is also the case in the private sector where large-scale computer projects have been introduced. However, with careful monitoring they can also bring enormous dividends and benefits to users.

We do not feel that the amendment would contribute significantly to delivery leverage for EPS. EPS is an essential component of a modern pharmacy service, and we intend that it should be provided by all NHS community pharmacies. EPS is on everyone’s agenda—it is not just an issue for applicants to pharmaceutical lists. We do not agree with the amendment because a successful applicant to a pharmaceutical list currently has up to 15 months to open. In that time, the parameters for EPS compliance may change, so a PCT’s compliance assessment at the time of application may be out of date or irrelevant by the time the pharmacy opens.

If we find in future that IT systems are compliant with Release 2 of the EPS but pharmacies are still not delivering the service, we have scope in clause 26 to make provision as to what matters the PCT must or must not take into account for the purpose of determining whether to grant the application. I therefore ask the hon. Gentleman to consider withdrawing his amendment.

Stephen O'Brien (Conservative, Eddisbury)

I am grateful to the Minister for seeking to address my point. I hope he realises that I raised it in a genuine attempt to be constructive. In resisting the amendment, he prayed in aid the 15-month time period between when the choice is effectively made and implementation. He also prayed in aid the fact that due to the nature of technology, the programming, the system and the compatibility could change during that period.

This is one area where we must be extraordinarily cautious. To the extent that I have found myself dragged, somewhat reluctantly, towards the NHS IT programme, I understand that one will never catch up with the leading edge of technology. One must set a point at which one is trying to achieve a certain standard and say, “That’s the standard to be met,” and not always worry about things such as the 15-month period. The Minister is absolutely right: the technology may well move forward. The issue is compatibility with a standard that will work to deliver the service.

I will not press the amendment, because I think that the issue requires continuous careful and vigilant monitoring, as the Minister accepted. We need to watch it carefully, as there are fantastic benefits to be gained—he sought to highlight some—but it could easily trip on the basis that implementation is flawed or time-lagged and there is a lack of capacity for, let alone understanding of, the standards to be applied to achieve compatibility. Although the amendment is the sort that one might want to press to a vote in a somewhat virile way, to demonstrate that one means it, on this occasion I will withdraw it. However, we need to highlight the issue and ensure that the Minister, the Department and the Minister’s advisers keep it as a high priority in order to make it work. I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 37, in clause 26, page 29, line 8, at end insert

‘including the impact that granting an application would have on existing services.’.

I am delighted that somebody, in a sedentary position, regards it as a signal victory to have reached amendment 37.

I intend to consolidate some of the issues that have been raised so far. We have discussed the need to consult patients and highlighted the potential impact of the pharmaceutical needs assessment on the services that dispensing doctors offer patients. We have also discussed the different needs of rural and urban populations—however one wants to describe them—and I have sought to ensure that the Minister takes all those matters into account in setting regulations for the PCTs.

In many respects, amendment 37 would solve the problems raised by the Dispensing Doctors’ Association with regard to offering patients a choice of services. If PCTs were duty-bound to assess what impact granting an application to the pharmacy list would have on existing services, they would have to ensure that the new service would complement and enhance existing services, thereby safeguarding patient choice and potential patient preference for existing services, such as those of dispensing doctors, be they in the Minister’s PCT or my own. Hopefully, the PCT would then avoid cutting services unnecessarily or granting applications to provide services that do not add to patient choice or increase patient access to pharmacies or dispensers. PCTs would, of course, still have the right to cut services in circumstances where they breached a term of arrangements under new section 150A of the National Health Service Act 2006.

The amendment is simple. I hope that the Minister’s thoughts will turn towards accepting this worthwhile amendment to the Bill.

Mike O'Brien (Labour, North Warwickshire)

The amendment aims to oblige PCTs to consider the impact that granting an application would have on existing services. I can see the importance of doing so, but it is also a key concern that the new arrangements for determining entry to a pharmaceutical list should not be used simply as a basis for PCTs to refuse all or any new applications without some clear, robust and objective ground. Just as we saw when the matter was raised in the other place, I am concerned that the consequence of the amendment would be unwittingly to restrict new entries, so it would constrain competition and could undermine new businesses’ ability to enter the field. The hon. Gentleman looks quizzical, but if he looks at this he will see that it could well be the consequence.

Each and every application will have some impact and effect on contractors; that is unavoidable, but how much is a question of degree based on local factors and circumstances. It is impossible for us, from the centre, to understand the exact impact in every case. We must strive to achieve the right balance between adequate PCT controls and the freedom of contractors to operate without creating disproportionate burdens or costs. When we consulted on this proposal last autumn, we recognised the need to strike that balance. We proposed to use existing factors introduced in the 2005 regulations to the current control of entry tests. These factors are the level of access, the choice and diversity of providers, innovation in service delivery, the services available to specific populations to meet specific health conditions or disease needs and the overall longer-term impact of approving new applications.

We intend to include the criterion of longer-term impact that this amendment proposes in the new regulatory regime. We have not determined that this criterion should have pre-eminence above all other criteria. It is one of a range of factors that PCTs need to consider when determining whether, against its assessment of local needs, an application should be approved or not. PCTs will have to weigh up the facts, look at the evidence carefully and determine the plus and minus points accordingly before reaching their decision.

I also make the observation on the amendment that I think it is equally important that PCTs should consider the longer-term impact when they are minded to refuse an application, not just when they are minded to grant one. Refusing an application may have implications for other businesses and competition in the area. My concern is that the result of this amendment would be to restrict competition, to inhibit business, to prevent new entry of businesses into this area and, in effect, to restrain the market in a way that I did not think the Conservative party believed in. It seems that, in response to lobbying, it is disposed to do that unless the hon. Gentleman decides, as I hope he will, that he will not press this amendment to a vote.

Stephen O'Brien (Conservative, Eddisbury)

We do not favour any kind of protectionist approach. When the Minister suggested that I might be quizzical—I was not quite sure who he was indicating as I had my head down—I was writing a note.

Mike Penning (Conservative, Hemel Hempstead)

I think he was looking at me, but I was yawning.

Stephen O'Brien (Conservative, Eddisbury)

I shall move on swiftly. The Minister has over-egged his case. If one looks carefully at the wording of this amendment, it says that, where primary care trusts have determined to make any kind of recommendation, the regulations may make provision for the manner in which they determine that grant and matters that the primary care trust must and must not take into account for the purposes of determining whether to grant the application, including the effect that granting such an application would have on existing services. Far from restraining competition or inhibiting new business, the fact that they would have to acknowledge that they have taken into account the effect that granting such an application would have on existing businesses might result in their granting an application because it increased competition. They might be concerned that a particular area had no competition, and consider that granting the application would ensure that an efficient service was delivered, prices were kept keen and customers would receive first-class customer services.

The Minister has overplayed his hand, as he has exaggerated what the amendment actually states. It makes explicit what is set out and is referred to in the justification by a primary care trust. A trust must ensure that it has taken into account the effect that granting an application would have on existing services. To be frank, in light of cases that have arisen in my constituency and I dare say in others, the problems have arisen precisely when it appears that there has been no explicit justification to make a recommendation without reference to the effect that it might have on existing services—not that it would inhibit new business or restrain competition.

Mike O'Brien (Labour, North Warwickshire)

I do not disagree with the point that the hon. Gentleman has just made. When PCTs make these decisions, it is important that they weigh appropriately the impact that a decision will have on local services, and that means the impact on other pharmacies in the area. He may well be right that, in some cases, PCTs have failed to give the appropriate weight to that criterion when they make a decision.

Stephen O'Brien (Conservative, Eddisbury)

I am grateful to the Minister, because our dialogue has brought us back to where we need to be. We want to ensure that that consideration is made explicit and that we do not end up having unnecessary concerns, disputes or even campaigns locally because there has not been a sufficiently explicit explanation of what lies behind the thinking of a PCT and its recommendations.

On that basis, I do not need to press the issue to a vote. However, it was very important to have clarity in terms of what the amendment was intended to say and, given the way that the Minister provided the counter-argument, I also wanted to make sure that the record was absolutely straight.

Mike O'Brien (Labour, North Warwickshire)

The points that the hon. Gentleman has made during his closing speech have made me think a little further about these issues. In due course, as I consider some of the points that he has raised, I may write to him on this matter.

Stephen O'Brien (Conservative, Eddisbury)

I am most grateful to the Minister. I think that that has been a very satisfactory exchange.

I beg to ask leave to withdraw the amendment.

Clause 28

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 133, in clause 28, page 30, line 12, after ‘period’, insert

‘and in consultation with the professional and regulatory bodies for pharmacists.’.

Robert Key (Conservative, Salisbury)

With this, it will be convenient to discuss amendment 134, in clause 31, page 31, line 36, after ‘period’, insert

‘and in consultation with the professional and regulatory bodies for pharmacists in Wales’.

Stephen O'Brien (Conservative, Eddisbury)

I am sorry that nobody else is getting up to speak at the moment; I feel that I have talked enough already. [Laughter.] Do not all agree.

Happily, we have now reached clause 28, which is on the second page of the second list of grouped amendments and not on today’s list of grouped amendments. Amendments 133 and 134 would place a duty on PCTs to consult the regulatory and professional bodies for pharmacists in England, in relation to clause 28, and in Wales, in relation to clause 31. They seek to probe the Government about where the power to suspend pay should lie.

Earl Howe raised the issue of a PCT’s powers of intervention in matters concerning pharmacists’ professional conduct in the other place. However, he did so with regard to another clause in the Bill. I want to address some of the issues that he commented on with respect to clause 28, as I question whether it is appropriate for a PCT to suspend the pay of a pharmaceutical service. The power to suspend pay could be detrimental to patient care if it is not strictly controlled. If the payment of pharmaceutical services is suspended, those services could deteriorate rapidly and that could severely hamper services to patients. As the National Pharmacy Association put it:

“Pharmacies’ day-to-day financial outlay cannot usually be deferred, so withholding payment would have an immediate and dramatic effect on cash flow and the consequent ability to provide core services.”

We must ensure that the measure is used as a last resort and that the power to suspend pay is not exploited in inappropriate circumstances. What assurances can the Minister give that the use of this power will not have a detrimental effect on local services?

Another reason that I tabled my amendment is that PCTs may not understand the nuances of the pharmaceutical sector and therefore may not be in a position to make a judgment as to whether they have breached the arrangements for service delivery. However, I believe that the principle behind clause 28 is right. I merely wish to query whether the decision to suspend pay should be a collaborative one rather than one that is made solely by the PCT.

Perhaps the Minister can specify in his response the measures that he will put in place to prevent PCTs from abusing the power to suspend pay. If a PCT has commissioned a pharmaceutical service, it is perversely in its interest to suspend pay while still reaping the benefits of that service. In extreme circumstances, the system could be abused to bring about cost savings. An arbiter in the form of a pharmaceutical regulatory body could prevent such a situation from arising and ensure that the case of the accused pharmaceutical service is sufficiently represented.

To quote Earl Howe:

“The natural question that arises is who regulates pharmacists. Is it PCTs or is it the Royal Pharmaceutical Society of Great Britain? If it is in effect both, which body takes precedence?”

In her answer to Earl Howe, the Minister, Baroness Thornton, stated:

“The GPhC will be the new regulator for pharmacists, pharmacy technicians and pharmacy premises, taking over the role currently performed by the Royal Pharmaceutical Society of Great Britain”.

She assured Earl Howe that the Government will

“strive to demarcate in the regulations”

of clause 24

“the respective responsibilities of the new regulator and the responsibilities of primary care trusts.”—[Official Report, House of Lords, 11 March 2009; Vol. 708, c. GC481-482.]

However, her reply does not answer my question on the suspension of pay in clause 31. Should the council, with its new responsibilities, be given a role in deliberating whether the actions of a pharmaceutical service warrant the actions outlined in clause 31? I would be grateful for the Minister’s reply on that point.

Robert Key (Conservative, Salisbury)

The question is that the amendment be made. I call Mr. Stephen O’Brien.

Mike O'Brien (Labour, North Warwickshire)

Too many O’Briens, Mr. Key.

First, I should like to make it clear that we see the use of the powers as a matter of last resort, not of first resort. They will be part of a progressive series of steps to ensure that contractors achieve acceptable quality standards, and PCT decisions will be appealable. The same provisions are proposed in clause 31 for Welsh Ministers.

The amendments would place a duty on PCTs in England and on local health boards in Wales to consult professional and regulatory pharmacist bodies before deciding whether to withhold NHS contractual payments that are due to a person when there are continuing concerns about poor or inadequate performance. I am not convinced as to why that is necessary. As a general rule, we strive to keep NHS contractual matters and professional regulatory matters distinct. The amendments would confuse and integrate the two.

I reassure the hon. Member for Eddisbury that there is no intention to penalise individual pharmacists for poor performance. In that respect, the aim is to look at the practitioner as the person as set out in the pharmaceutical list. The list is published by the PCT of persons who are authorised to provide pharmaceutical services by the PCT. In other words, it is essentially a list of contractors. They may be sole traders, partners or companies and it is not a list of individuals.

The aim is to ensure that when absolutely necessary, we are able to intervene to deal with something when it gets to such a poor state that the quality of provision being made available to local people deteriorates unacceptably. If we accepted the amendment, it might leave professional and regulatory bodies rather baffled as to what they would be expected to do if a PCT consulted them. That is not the remit of those bodies, nor would they be equipped to take on such a role. They are not really in a position to take a view on a PCT’s responsibilities. For that reason, Welsh Ministers and I cannot accept the amendments, and I ask the hon. Gentleman to withdraw.

Stephen O'Brien (Conservative, Eddisbury)

Obviously, I listened to the Minister and he said early in his reply that the powers were last resort powers, which is important. He also made the point that there was a degree to which the regulatory bodies would be baffled. Whether or not that is the case, I made it clear that my amendments were probing and that I did not intend to press them to a Division. The Minister’s response went a long way towards clarifying the question of the demarcation of responsibilities for regulation, and I beg to ask leave to withdraw the amendment.

Clause 29

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 150, in clause 29, page 31, line 7, leave out ‘prescribed circumstances’ and insert

‘accordance with regulations issued by the Secretary of State’.

Robert Key (Conservative, Salisbury)

With this it will be convenient to discuss amendment 151, in clause 29, page 31, line 7, at end insert—

‘(2C) The regulations under this section must make provision—

(a) as to the circumstances under which a Primary Care Trust may provide local pharmaceutical services.

(b) as to a duty placed on Primary Care Trusts to report any plan to provide such services to the Secretary of State.’.

Stephen O'Brien (Conservative, Eddisbury)

The amendments address my fear that parts of clause 29 are too loosely worded to merit the circumstances in which the Government claim that they would apply this legislation. I guess that all Committee members can follow that we have left pharmaceutical services in England and moved into chapter 5A, “Notices and penalties”. Although we have left the part of the Bill that dealt with them, we are now back to the question of local pharmaceutical services. I just wanted to make sure that we are all clear what we are talking about.

In the explanatory notes, the Government state that PCTs should be able to provide their own pharmaceutical services in the case of an emergency or an exceptional circumstance. The Bill will

“remove the restrictions in NHS legislation on PCTs providing local pharmaceutical services...or to other PCTs, in certain circumstances, for example, in the event of any emergency such as a flu pandemic or where there was no alternative provider.”

The clause is topical as well as important.

The impact assessment makes a similar statement by noting that PCTs will

“provide services themselves in an emergency or where there is no suitable alternative”.

It goes on to state:

“At this stage the Department has not identified a significant impact arising from these proposals, as the use by PCTs of these new provisions would be expected to be of limited duration and only in exceptional circumstances”.

That admission is at least a bit surprising, given that we are on the brink of a flu pandemic that could sweep across the nation at any moment. The Department obviously had swine flu in mind when drafting the Bill, as it referred to the flu pandemic in the impact assessment, yet it has not assessed the provisions’ impact in advance of an outbreak, which is a serious concern. Perhaps the Minister will address that matter in his response.

In a case where a PCT decides to provide a local pharmaceutical service, I understand that the strategic health authority would become the commissioner in order to prevent a situation from arising in which a PCT is performing the roles of both commissioner and provider. In clause 29, the Government amend legislation from the National Health Service Act 2006 to make provision for such circumstances.

My concerns with the Government’s amendments to the 2006 Act are twofold. First, there is an issue of accountability. If PCTs are to carry out the function only in an emergency, surely the circumstances in which they are permitted to provide pharmaceutical services should be prescribed on the face of the Bill; otherwise, there is nothing to prevent PCTs from providing services on a whim or in normal circumstances that do not qualify as an emergency.

What parties will define an emergency? Patently, that is the threshold. My amendments would allow for that by permitting the Secretary of State to publish in a series of regulations the circumstances in which a PCT could provide such a service. The amendments would also place on PCTs a duty to inform the Secretary of State of their intentions if they believe that circumstances allow them to provide a service.

The Minister may argue that at a time of emergency, he does not want so-called bureaucracy or red tape getting in the way of PCTs becoming pharmaceutical providers, and I am pretty sympathetic to that. However, it is only fair to argue that the Government must also make adequate provision for the times when we are not facing an emergency and prevent PCTs from providing the services unnecessarily. It seems ludicrous that under the proposed legislation, a PCT could conduct a PNA, identify a need and then seek to provide for that need itself, all within the bounds of the Bill. What is to stop a PCT deliberately identifying a need it knows that it can satisfy, purely for financial gain? I accept that that is an extreme form of analysis but it is not implausible, particularly if there were any real pressure on a PCT and it was looking to gain from the situation. I accept that we are discussing extreme circumstances, but as it is our job to point out significant pitfalls in the Bill, it is right and appropriate that I have raised such matters, without casting any aspersions on the current management and composition of boards of any PCT in the land. I hope that I have given a good explanation of why the amendments have been tabled. Obviously, the Minister’s reply will be both interesting and important.

Mike O'Brien (Labour, North Warwickshire)

Clause 29 amends section 144 and schedule 12 of the National Health Service Act 2006 to enable the Secretary of State to authorise PCTs to provide local pharmaceutical and drugs services in certain situations. There is no intention to enable PCTs to have a long-term role in providing drugs directly. Let me be clear. We want to enable PCTs to provide services in local situations, such as in an outbreak of pandemic flu or when there is no suitable alternative provider. The Bill would enable the strategic health authority or another PCT to become the commissioning body, in effect, of the providing PCT. That role and distinction will be maintained.

We propose these changes because it is prudent for a PCT to have the power to act as a service provider. The emergencies that we are describing are those in cases of a serious pandemic of, say, flu. We are aware that the current swine flu condition has been described by the World Health Organisation as a pandemic and that its impact so far on individuals has appeared in the vast majority of cases to be relatively mild. A dose of flu is never completely mild, but we must compare it with some of the strains that we have experienced over the decades. Flu can happen in waves; it can, in effect, pass through and come back again. We need to make provision for not only flu, but other eventualities, so the provision is very much seen as a precautionary step to enable us to put in place the necessary legal infrastructure, should the need for it arise.

The last thing that we want is to take certain steps to ensure that people have access to drugs, but not have the legal basis to do so. That would be wrong. It would be not thinking ahead. There could be circumstances in which we need to have such a provision, so let us be sure that it is on the statute book. We can make the necessary regulations to enable safeguards. Section 175 of the 2006 Act defines prescribed as being prescribed by regulations made by the Secretary of State. The provision would not enable the PCT just to make a decision. I appreciate that the hon. Gentleman was stating an extreme case, but that could not arise because Parliament would have passed a regulation enabling such powers to be exercised.

There will be limited circumstances. There will be no long-term role as a provider of pharmacy services for PCTs. Their role will be to ensure continued provision in emergencies or when there is no suitable alternative. We envisage the powers being used in emergencies and used only as a temporary measure until the normal service can be resumed. Having given those reassurances, I hope that the hon. Gentleman will withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I am grateful to the Minister. He has made it absolutely explicit that, in addition to what he describes as normal safeguards, there is no intent behind the provision for there to be a long-term role for PCTs to deliver such services. It is important to recognise that, perhaps in a less extreme example, there could be a temptation, particularly in the local human-to-human transmission flu pandemic that we are technically now in. I accept that the Minister was right to temper that approach by saying that we are now dealing with relatively mild and short-lived episodes.

None the less, there is a transmission taking place and we have rising numbers. No doubt the Government are taking advice, just as we do, but according to all the expertise the likely profile of pandemic flu is one wave, most probably followed by a larger wave in a second phase, and possibly even a third phase. Even if no long-term role is intended, in the case of the current pandemic—not the swine flu epidemic—there is a danger that we might say, “We had better keep the position going in case we need it for the second wave,” and therefore prolong it beyond what would be the normal intent of there being no long-term role.

It needs to be recognised that the profile of flu pandemics might make the body hesitate to get out of making the provision and therefore turn it from a short to a medium-term role. With that caveat it is clear where the intent lies. I do not think that the amendment needs to be pressed to a vote, but it has been useful to ensure there is absolute clarity. Given the current flu pandemic, it helps to have that in mind when one thinks about where a true emergency lies in such circumstances, and where therefore we need to ensure that there is a proper restraint on the ambitions of those who might want to set up services where they are not the best people to do so. I therefore beg to ask leave to withdraw the amendment.

Clause 33

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 40, in clause 33, page 32, line 32, leave out ‘adult’.

Robert Key (Conservative, Salisbury)

With this it will be convenient to discuss the following: amendment 41, in schedule 5, page 53, line 12, leave out ‘adult’.

Amendment 138, in schedule 5, page 53, line 13, leave out ‘adult’.

Amendment 42, in schedule 5, page 53, line 14, leave out from ‘interpretation’ to second ‘social’ and insert ‘social care provider” and’.

Amendment 43, in schedule 5, page 53, line 16, leave out ‘adult’.

Amendment 63, in schedule 5, page 53, line 17, leave out from ‘2008’ to end of line 18.

Amendment 44, in schedule 5, page 53, line 19, leave out ‘adult’.

Amendment 45, in schedule 5, page 53, line 21, leave out ‘adult’.

Amendment 46, in schedule 5, page 53, line 25, leave out ‘adult’.

Amendment 47, in schedule 5, page 53, line 30, leave out ‘adult’.

Amendment 48, in schedule 5, page 53, line 32, leave out ‘adult’.

Amendment 49, in schedule 5, page 54, line 1, leave out ‘adult’.

Amendment 50, in schedule 5, page 54, line 2, leave out ‘adult’.

Amendment 51, in schedule 5, page 54, line 17, leave out ‘adult’.

Amendment 52, in schedule 5, page 54, line 32, leave out ‘adult’.

Amendment 53, in schedule 5, page 56, line 8, leave out ‘adult’.

Amendment 54, in schedule 5, page 56, line 35, leave out ‘adult’.

Amendment 55, in schedule 5, page 58, line 25, leave out ‘adult’.

Amendment 56, in schedule 5, page 58, line 44, leave out ‘adult’.

Amendment 58, in schedule 5, page 59, line 18, leave out ‘adult’.

Amendment 59, in schedule 5, page 59, line 28, leave out ‘adult’.

Amendment 60, in schedule 5, page 59, line 42, leave out ‘adult’.

Amendment 61, in schedule 5, page 59, line 47, leave out ‘adult’.

Amendment 62, in title, line 5, leave out ‘adult’.

Robert Key (Conservative, Salisbury)

And amendment 57, in schedule 5, page 59, line 9, leave out ‘adult’.

Stephen O'Brien (Conservative, Eddisbury)

All I would say, Mr. Key, is that if you were testing whether we were awake and paying attention to your every utterance, I am glad to say we have all passed the test admirably. One could say that you left out 57 because it is all the varieties. At this stage, any humour is better than no humour. Those of us who come from the north-west are very proud of the fact that the 57 varieties come from the Wigan factory, which one passes on the M6.

This tranche of amendments—a good fistful of amendments—will be deceptively short in its proposition. It is simply to ask the Minister why the complaints avenue is limited to adult social care, and what is the equivalent available to children? That is something that we spent a huge amount of time on in the Health and Social Care Bill, which was roundly rejected at the time by one of the Minister’s predecessors. However, it would be a shame to let the Minister off the hook too quickly and easily. Therefore, with your permission, Mr. Key, anticipating that you might wish to suggest that we do not delay on a clause stand part debate, I might set the context in which all the amendments can sit.

Robert Key (Conservative, Salisbury)

I would be very content with that.

Stephen O'Brien (Conservative, Eddisbury)

I am happy to have your assent, Mr. Key. I will touch on some of the general points, which will enable us to avoid that lengthy stand part debate, and then trot through the amendments.

We welcome the measure, although there is little excuse for the two years that it has taken since the former Health Minister, the hon. Member for Bury, South (Mr. Lewis) first promised it in 2007. As we have so often pointed out, it could easily have been part of the Health and Social Care Act 2008. During the passage of that Act, the right hon. Member for Exeter (Mr. Bradshaw) denied our amendments to it, saying

“self-funders can, of course, take their custom elsewhere. They can choose civil remedies through the courts”.——[Official Report, Health and Social Care Public Bill Committee, 17 January 2008; c. 348.]

Apparently the Government have no qualms about people frail enough to be in nursing care moving every two weeks, with occasional trips to the witness box. We were quite angry with the Government for denying us what was a constructive approach at that time, so we are glad that the Government have come forward with this measure, albeit in a slightly face-saving way. Common sense seems to have prevailed at last, and I am glad that our arguments have won though.

Paragraph 303 of the explanatory notes states:

“The Government expects that in the majority of cases the complainant would raise the complaint with the provider first”?

On what basis did the Government make that assumption? We are clearly legislating for complaints that are unsuitable to be made to the provider, or that the provider has failed to deal with, so that will not impact the baseline.

It is a shame that we are debating such matter before the publication of the Green Paper. I dare say that all members of the Committee witnessed what I would call a sleight of hand from the Minister today—not this Minister, I hasten to add, but his colleague, the Minister of State, Department of Health, the hon. Member for Corby (Phil Hope). We have been calling for the Green Paper on adult social care for many months and the Government have been promising it for many months—the former Health Minister, the hon. Member for Bury, South (Mr. Lewis) promised a new settlement for some years. We were told that the Green Paper would definitely be out by the spring, but by every test in the book, spring finishes on either 21 June or 25 June. We had anticipated that it might be published on 29 June. We understood that the Government might not want to affect the time that the Committee was sitting, but now we are told that it will be July, so there is yet more slippage.

Many people are extremely anxious to see what this Green Paper will contain because it will set the framework for this debate, which is vital. It would have been helpful to have had the Green Paper before considering the Bill, because it may—I think that it should—have major ramifications for the shape of social care in this country.

Lord Darzi told peers in another place that the Green Paper would be published in early 2009,but as I have just explained, it now looks like July. I would also caution the Minister on the rhetoric that seems to have been used in the regulatory impact assessment. The summary states that this will create a level playing field between privately and publicly funded users. That is a vital area, which again was discussed at length during the debates on the Health and Social Care Bill. The hon. Member for Hendon (Mr. Dismore), who chairs the Joint Committee on Human Rights, has made a large contribution to the debate on the distinction between privately and publicly funded users being diminished to nothing, so that there are equal rights. As all of us know, it is invidious that two patients can be in neighbouring beds, one of whom is completely publicly funded while the other is privately funded. That causes anxiety and issues—often for the relatives as much as for the patients, but also because of the human rights issues and who can enforce the legislation.

Paragraph 24 of the regulatory impact assessment points out that

“the policy does not include private health care.”

How have the Government ensured that by opening the door to private funders in social care, they do not open the door to private funders in health care as well? I do not for a second underestimate the complexities. We need to keep the debate on sensible grounds. We started the scrutiny of the Bill discussing the NHS constitution, which is totally focused on public provision and the use of public money for NHS services. When looking at this kind of complaints procedure we absolutely butt up against the difficulty of a mixed economy of health care, which, whatever its merits or demerits, exists. We therefore need to make sure that to the best of our ability is, as we push through any new legislation in this area, there is real acknowledgement of the need to seek and find equity in the process.

Moreover, I remind the Committee that although the Government have closed the loophole by which publicly funded individuals in private care were not covered by the Human Rights Act 1998—I alluded to that a second ago—the individuals we are discussing today, private funders of private care, are still not covered by the Act. I am not suggesting that they should be, because of the way the Act works in relation to public bodies, but it leaves an area uncovered in terms of the potential for rights and enforcement. I dare say that all of us at least need to be cognisant of that, even if this is not the right vehicle to try and address that.

The RIA says that social care services, unlike health services, have developed under a funding model under which a sizeable proportion of services pay their own way—some 300,000, or 35 per cent., according to the RIA. I asked the Minister whether the passive really is a suitable voice for a system that the Government have failed to reform, despite many promises to date. I also question an odd line in paragraph 30 of the RIA, which states:

“we do not foresee the need to enter into a formal public consultation because the policy is a ministerial commitment made in Parliament.”

I hope that the Minister will be able to ensure that that position is put in context.

At this stage, the amendments all go to the same point—why do the provisions cover only adult services, and not children’s care services? Why is the proposal limited? When will the Green Paper, which will have ramifications, be published? July is the nearest we can get to at the moment. Will the Minister inform the Committee of the basis for the Government’s estimate of numbers? What ramifications may this have for private health care funders and for all those still not covered by the Human Rights Act? Do the Government need to consult on statements made in Parliament and will the Minister credit the Opposition with holding the Government’s feet to the fire? It would be rather nice to have that acknowledgement.

Mike O'Brien (Labour, North Warwickshire)

I am not sure whether my feet feel held to the fire, or I am just left cold, but I have rarely heard the words in an RIA described as “rhetoric”. I suspect that Martin Luther King will not have to feel challenged about that. In answer to the question of how long the wait will be for the Green Paper—not long. On private care, it is not our aim to provide a new system, it is about NHS care and recognising that sometimes it can be provided by private sector organisations. However, where public money is involved there should be appropriate safeguards for those using the service.

I can understand the thinking behind the amendments, but I would like to explain why I do not believe that they are actually necessary. One of our main objectives in creating the new scheme is to give people who arrange or fund their own adult social care services, access to independent consideration of their complaints comparable to that enjoyed by people with access to local authority adult health services complaints procedures. We have designed the new scheme so that its scope is limited to service providers who actually carry out regulated activity within the meaning of part 1 of the Health and Social Care Act 2008—in other words, adult health services. There are good reasons for that. There is not only a different system for complaints about children’s social care services, but a different system of regulation under separate legislation. I therefore believe that it makes sense to keep adults’ and children’s complaints processes separate. For many years there have been separate arrangements for children’s complaints about social care services under the Children Act 1989. These arrangements are different in many ways from adult procedures as they reflect the specific needs of children. I hope that deals with that point.

In terms of the need to consult, the policy has already been discussed during the passage of the 2008 Act and is the subject of ministerial commitment. In addition, we believe this is an uncontroversial measure that is widely welcomed and any alternative approaches are not realistic. We prefer a reference group approach, which can focus on the practicalities of implementation rather than the issue of whether or not the policy should be carried through. We seek engagement with the stakeholders regarding implementation. We need their advice and input on the way we engage, but the issue is clear. I assume there will be broad support for the way in which we are giving these additional rights; indeed, the support is so broad that the Conservative Opposition appear to be claiming credit for it. I do not mind where the credit is taken, provided this Government continue to deliver for people.

Stephen O'Brien (Conservative, Eddisbury)

As long as the Minister is not trying to put a time on that, we can all have our own thoughts as to how long that may be. As he referred to Martin Luther King, we can all have our dreams.

Mike O'Brien (Labour, North Warwickshire)

In your dreams.

Stephen O'Brien (Conservative, Eddisbury)

The Minister has sought to satisfy us why this measure has been limited to adult social care. There is a genuine anxiety that, for whatever reasons and whatever the merits and demerits, children’s social care and adult social care are effectively dealt with by two different arms of Government. As with all such issues, there is both a desire and an anxiety on the part of the Government and those who scrutinise it, that this above all is an area that should be joined up. An absence of joined-up thinking in relation to children is always of grave concern, particularly when so many social services are produced from the same source within the local authorities with whom we as hon. Members have to deal. That is notwithstanding the fact that this has been put under the banner of children’s services and that the onset shortly of children’s trusts will be key. Although I cannot see an immediate solution to breaking down that barrier in the way that legislation is approached because of departmental responsibilities, there is a need to recognise that the issue of complaints, particularly with regard to children, is effectively the same as in the courts. There one has an advocate appointed by the court or some kind of friend to enable an approach to be made. I hope the Government will give that active consideration.

Having listened to the Minister I will not press these amendments to a vote, but it is important to recognise the issue. In seeking to introduce this series of linked amendments it took me a long time to find amendment 62 in the documentation as it is right at the back and had just been linked with this subject. It merited discussion and I hope some more thinking will take place. I beg to ask leave to withdraw the amendment.

Schedule 5

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 104, in schedule 5, page 53, leave out lines 25 to 35.

Unlike in the previous clause, the amendments to this one are sequential rather than grouped. We had some discussion on that but, given that we are not under so much pressure, it will be easier to take them separately as I have prepared them.

On amendment 104, the Bill as drafted suggests that an action is to be treated as an action taken by the legal person of the provider. In other words, in terms of liability, an action is to be treated as an action taken by the provider if it is taken either by a person employed by the provider, a person acting on behalf of the provider, or a person to whom the provider has delegated functions. Those are quite common legal concepts. The provisions suggest that the conduct of individuals will not be considered or commented upon, which seems odd, both in itself and if and when we move to a fully registered work force.

We need to be clear that one of the potential key benefits of the process is that it is able to ensure that lessons can be learned from its findings on complaints. We are dealing with potentially extremely sensitive and vulnerable situations, and it behoves all of us to ensure that lessons are quickly learned. One of the most shocking recent absences in relation to adult social care is what has taken place at Stafford hospital, and the Mid Staffordshire NHS Foundation Trust was prayed in aid by some of the earlier amendments tabled by my hon. Friend the Member for Hemel Hempstead. It is absolutely vital that we keep in mind how quickly we need to ensure that lessons are learned.

I also need to know, if I may press the Minister, what happens if a provider goes bust but the management team continue trading under another name. I assume that the body remains accountable, but there must be a question mark on the concept of being able to pierce the corporate veil. As a lawyer, I will not go into the detail of that, because I dare say that other members of the Committee are familiar with the concept at a legal level. While that is not a completely happy analogy, it helps promote my point, and I would like the Minister to comment on how far one can get behind the legal person of the incorporated or unincorporated body actually to get to some of the individuals involved.

The amendment raises the important principle of liability, and I hope that the Minister will clarify the schedule as drafted. I do not for a moment suggest that the amendment is particularly elegant or happy, but it has given me the opportunity to raise a point, and I hope that the Minister will offer some analysis and comfort on the issue.

Mike O'Brien (Labour, North Warwickshire)

New section 34A includes the definitions of adult social care and adult social care provider for the purposes of the new scheme set out in new section 34B. The meaning of adult social care is the same as that in section 9 of the 2008 Act. The amendment would remove subsections (4) and (5) of new section 34A, which provides that action taken on behalf of the provider should be treated as action taken by that provider. Not referring to the ombudsman being able to investigate action taken on a provider’s behalf would introduce uncertainty about the coverage of the scheme, and I am glad to have the opportunity to set out why that would not be desirable.

Our aim is to ensure that complaints about social care that is provided under any arrangements where the provider has delegated a service remain within the ombudsman’s remit. We want the ombudsman to have a fair degree of discretion. The provisions cover action taken by an employee, by a person with whom the service provider was contracted to provide the service, as well as where the service is provided by a less formal arrangement with another person. I do not believe that anyone would think it right for a service provider to evade investigation of poor practice just because someone acting on their behalf carried out the service for them and was directly responsible for the actions.

Suppose a care home provider contracts with a person for that person to come into the home and provide a particular service, which is then the subject of a complaint. Under these provisions, the care home provider is still responsible for what happens within that care home and they should rightly be subject to an investigation if there is a complaint to the ombudsman. Without these provisions, it would be easy for such a provider to escape investigation by arguing that the service that had been the subject of the complaint was carried out by someone else on their behalf. That would be wrong and therefore I trust that the hon. Gentleman will feel able to withdraw the amendment.

The hon. Gentleman rightly raised the issue of those who trade under different names and he asked to what extent we can pierce that corporate veil. It is our intention that the ombudsman would be able to examine all the circumstances in a case and would have broad discretion in the way that that would be done. It would be the facts that would be investigated rather than a corporate individual. If the ownership of a particular care home was to change and was passed among a number of organisations, each of which was a separate corporate entity but owned by linked individuals, the ombudsman would still be able to look at the facts and the circumstances before taking a view on the matter.

Stephen O'Brien (Conservative, Eddisbury)

I am most grateful to the Minister, because this is obviously an important point and I think that he recognises that it is important in terms of the way that accountability flows.

I have had a case in my constituency that caused the most monumental nightmare for everyone concerned. After an inspection, the lady who originally owned the care home in question was found to have been operating something that was very sub-standard and indeed she faced some allegations that she had provided very poor care. Of course, her permission to operate was withdrawn under the various processes that applied.

It then turned out that that sanction had been wholly and wrongly misapplied to her, because the inspectors had placed an over-reliance upon information from the owner-boss of the care home; I will not name the case, for obvious reasons. During the inspection process, the company had been sold, it had become part of a larger group and there was a conflict of personalities between these two individuals. Consequently, there was an attempt by the new owner effectively to get rid of the former owner, so that the new owner could make efficiency savings; the removal of the former owner was certainly not going to do anything to improve patient care. It was an absolutely despicable case at every step. However, the difficulty was being able to get behind the issues of ownership.

As I say, I am grateful to the Minister for his clarification. I am sorry that this is a long intervention, but I am grateful to him because, as he said, the process is about investigating the facts. However, it can often happen in these cases, after the inspection and regulatory process, that matters reach the courts. The case that I mentioned reached the courts purely because there was a restraint of trade case that took place in the courts, because of the attempt by the new owner of that care home to restrain the original owner from going into competition with them after she realised that her future plans were being blocked. That was why we had huge difficulty in getting behind the different corporate entities.

I am glad that the Minister was able to take my point seriously, but this is a real issue; we are trying to ensure that patients do not suffer.

Mike O'Brien (Labour, North Warwickshire)

In trying to get to the facts in a case, there is obviously a requirement to get the relevant information. Where an ombudsman is concerned, it is always difficult for them to collate and obtain the information that they need. Some people may say that they just will not co-operate with the ombudsman and that remains an issue for us. I just want to warn the hon. Gentleman about that, because these provisions are not panaceas. They are ways of helping, instruments that are available to those who are badly done by, and we need to ensure that they are in place where they are needed. However, let us not pretend that they will solve all the problems or that they will be able to do more than they can.

There is also the point about an individual’s liability versus the liability of a home or a company. Let me say that an ombudsman can report, but whether compensation is paid or what the final outcome of a case will be is all a matter of law and there is also the question of whether there will be co-operation with the ombudsman.

These are complex issues and I just wanted to put on record the fact that there are a number of caveats, so that it is clear that I am not claiming that these provisions will provide all the guarantees that we might like to provide. They will provide a tool to ensure that complaints can be dealt with more effectively and to ensure that people have somewhere to go and some prospect of getting a remedy.

Stephen O'Brien (Conservative, Eddisbury)

I am grateful and the Minister is right; it is obviously a complex area. He is also right to be cautious because, while, as we have already stated, we more than welcome the proposal, there will always be some who seek to escape the full consequences of the law and everything that runs up to that. On the back of the discussion, which moved matters forward sufficiently, I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 64, in schedule 5, page 54, line 4, leave out ‘not’ and insert ‘choose not to’.

Quite simply, and this may display my ignorance, can the Minister explain what proposed new schedule 5A to the Local Government Act 1974 covers and why the ombudsman is not given discretion over investigations?

Mike O'Brien (Labour, North Warwickshire)

New schedule 5A excludes from the ombudsman’s remit the commencement or conduct of civil or criminal proceedings before any court of law. That mirrors the arrangements in the local authority scheme and also those for all other public service ombudsmen. For example, a complainant could not complain to the ombudsman about how the High Court dealt with a claim against a care home. That would not be appropriate for the ombudsman to investigate.

Stephen O'Brien (Conservative, Eddisbury)

That is fine. I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 65, in schedule 5, page 54, line 37, leave out ‘an order in Council’ and insert ‘regulations’.

Robert Key (Conservative, Salisbury)

With this it will be convenient to discuss the following: amendment 66, in schedule 5, page 54, line 39, leave out from beginning of line to ‘made’ and insert ‘A regulation’.

Amendment 144, in schedule 5, page 54, line 40, leave out from ‘(10)’ to end of line 41 and insert

‘may not be made unless a draft of the Instrument has been laid before and approved by a resolution of each House of Parliament.’.

Stephen O'Brien (Conservative, Eddisbury)

I am happy to say that I will withdraw the amendment but before I do so I need to say something about it. I would like clarity from the Minister about Privy Council responsibility and using Orders in Council rather than regulations. I move the amendment to get an answer.

Mike O'Brien (Labour, North Warwickshire)

At present the Bill provides for changes to be made by an Order in Council. An Order in Council is a form of statutory instrument and, as such, may be annulled in pursuance of a resolution of either House. That is what the Bill specifies. Orders in Council are made by Privy Councillors and have often been used to amend primary legislation governing public service ombudsmen. The use of regulations, on the other hand, is a power given to a Secretary of State, so is linked to a particular Department. Matters relating to the ombudsmen are not strictly departmental matters, which is why Orders in Council are used to make changes relating to ombudsmen in legislation. The new scheme will sit alongside the existing local authority scheme in the 1974 Act, under which there is already provision for the equivalent schedule of exclusions to be amended by Order in Council. If the power under proposed new section 34B is ever used, it is highly likely that it will be at the same time as the existing power. It would be cumbersome to have to have two different statutory instruments—one by Order in Council and one by regulation. I trust that the hon. Gentleman is satisfied that that is a reasonable way to proceed.

Stephen O'Brien (Conservative, Eddisbury)

I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 67, in schedule 5, page 55, leave out line 6 and insert—

‘(a) a person who has power of attorney for D’.

As drafted, a complaint can be made

“(a) by D’s personal representatives (if any), or (b) by a person who appears to a Local Commissioner to be suitable to represent D.”

I am sorry to use the wording in the Bill but it is probably the easiest way to ensure that the Minister understands what I am trying to say. The amendment substitutes “D’s personal representatives”—D being the person in care—with the more tightly defined power of attorney holder. We want to probe the Minister on what those phrases mean, particularly,

“(a) by D’s personal representatives (if any)”

and tease out how loosely “D’s personal representatives” is to be understood. Does it mean anyone speaking on behalf of D, or is it limited to a particular category of people because of the proof of a certain degree of connection or authority?

Mike O'Brien (Labour, North Warwickshire)

The Bill allows persons to complain on someone else’s behalf. If someone has died, or is otherwise unable to authorise someone else to complain on their behalf, a personal representative, or someone who appears to be suitable to the ombudsman, may complain. It gives a certain amount of discretion to the ombudsman. If someone has died, the estate or personal representatives in law will be in that category. The amendment would remove the right of personal representatives of a deceased person to complain, and instead, create the right for someone who has the power of attorney to do so.

The Bill allows someone authorised in writing by the person affected to make the complaint on their behalf. This could include a person with the power of attorney, so the power of attorney could, in any event, do that. But that is not enough for two reasons. First, since many service users are elderly and frail, it is a sad reality that they could have died before the complaint can be pursued. Secondly, they may be unable to authorise someone to act on their behalf. If the person affected has died, there may be a personal representative who will need to take that forward for the broader public good and to ensure that they are satisfied about how things were done in a particular circumstance. It is appropriate that they should have the ability to do so.

Stephen O'Brien (Conservative, Eddisbury)

I am satisfied with the Minister’s answer. The difficulty arises, as both he and I and indeed all members of the Committee will recognise, because our political generation faces the enormous demography of an ageing population. Yet, outside this particular arena, where we are effectively setting up a complaints process, there is also the process of people being represented at the onset of dementia and Alzheimer’s. There is always a tricky phase between the point at which we do not want someone’s independence, dignity and inner confidence impugned and when it is becoming too difficult for people to handle their own affairs. At that difficult time, it is possible that the personal representative’s approach in the complaints process will have a read-across to something that is not as formal as the power of attorney, or an enduring power of attorney, which now seems to be one of the areas that is causing quite a lot of problems. Does it take place before someone becomes a candidate to go into a residential care home, or does it happen after they have made their own decision to go into the care home? All sorts of issues surround this area, so I urge the Minister to comment on the potential of taking that example and looking at it a bit more widely. That would give us a bedrock on which to address some of the wider issues about the ageing population.

Mike O'Brien (Labour, North Warwickshire)

The aim here is to give the ombudsman at least a broad degree of discretion about whom he accepts a complaint from. It is right that when we are looking at such issues, we are conscious that it has a broader and general applicability. We are dealing with the ombudsman, and therefore, in a sense, we are taking the issues outside the legal, formal arena. In that arena, the courts will have a view about who is appropriate to make a complaint and what the circumstances are in which an organisation or individual is obliged to respond. That would be a matter of law. Here, again, it is a matter of law, but we want to give greater flexibility to the ombudsman to take a view about what sort of complaint it will be prepared to consider and from whom.

I accept that there is a wider general applicability to the issues. I am a bit more cautious than the hon. Gentleman wants me to be about how we go down the route, because I am conscious that we will have both legal and non-legal—in a sense, outside the formal, legal processes—obligations that we have to take account of. I do not want to make general statements about the capacity of individuals to make complaints on behalf of others, if the courts take a view that under its procedures, it would be not permissible for it to go much further than to the ombudsman with that sort of complaint.

Stephen O'Brien (Conservative, Eddisbury)

I am grateful. I hope that that was a useful exchange. I am satisfied on the actual substance of the amendment that it can be withdrawn. Effectively, the power of attorney point is included, rather than excluded. The general point that I made, using the issue as a hook to make it, is a discussion for another day. But there are some important issues that need to be established. As we are looking at contentious processes—this is the ombudsman effectively being brought into a process—it is part of a more appropriate way of dealing with complaints, particularly where the courts are involved. That is often a more contentious and difficult process, and often a barrier to access; an ombudsman is not, because of its availability and access to all. There is clearly an area in which such thinking may be a spur to thinking that needs to go on elsewhere. Hopefully, the courts will take good cognisance of it as we develop the process. I beg to ask leave to withdraw the amendment.

Stephen O'Brien (Conservative, Eddisbury)

I beg to move amendment 68, in schedule 5, page 55, line 14, leave out ‘12’ and insert ‘36’.

The ombudsman can take complaints only within 12 months of the event, although he has the power to suspend that. The simple question is: why 12 months, especially as the whole arena of complaints procedure was first promised—certainly more than mooted—in 2007? We felt that in fairness the time should stretch back to then and that is why we have substituted 36 months, which is around the average length of stay in a care home and might make some correlating sense. Furthermore, if the ombudsman can take complaints from events 12 months in the past, what assessment has the Minister made of the initial wave of complaints, which may meet the arrival of the framework? Paragraph 32 of the RIA states that the Government envisage up to 1,000 people a year having their complaint looked at. Where does the Minister get that figure from and is he concerned that up to 1,000 people will put in complaints on the first day, in addition to the 1,000 over the first year?

To some degree we have the example of what has just taken place in relation to the parliamentary ombudsman, with whom I had a meeting recently. A number of complaints already in train in the Healthcare Commission have now been taken on by the ombudsman, because the Care Quality Commission has taken over the Healthcare Commission’s role and the complaints process is with the parliamentary ombudsman. We have now reached the point at which the ombudsman’s own work load is arriving, as well as what has effectively been taken on from the previous Healthcare Commission work load. The Healthcare Commission was a public body, so had there been any allegation of maladministration or other such things in the broader remit of what the ombudsman can consider, there would of course have been some referrals from the Healthcare Commission to the ombudsman. There were three categories. That assessment needs to be made and clearly understood, as does the sourcing of the estimation in the regulatory impact assessment given by the Minister.

On the amendment, the RIA addresses set-up costs for the ombudsman in 2009-10, at paragraph 15, noting that they are in the region of £500,000 to £770,000. I would be grateful if the Minister could let us know whether the process has begun and when he expects the ombudsman to start.

Mike O'Brien (Labour, North Warwickshire)

There are a number of reasons why we have specified a time limit of 12 months. Before going into those, the hon. Gentleman is right that there needs to be a balance. I am sure that some people might have complaints from further back than that that they might well want dealt with, but we have to look at some basis upon which we judge how far back to go.

The measure mirrors the provisions in part 3 of the Local Government Act 1974, governing the ombudsman’s role in relation to local authorities. Twelve months is a reasonable time and the vast majority of complaints would reach the ombudsman well within that period. If we were to have a longer limit—for example, the three-year period proposed by the hon. Gentleman—some investigations could potentially be made more difficult, because key staff had moved on, or managers in the service might have moved to another job, and those that remained would find it difficult to recall accurately events going back three years in the past.

It is not impossible to do that—the courts do, the tax authorities do—and all sorts of provisions require longer periods, but we wanted to ensure that the ombudsman, who has a difficulty enough job in any event, is not burdened with all the problems of calling evidence, which would normally be done. Such issues are usually resolved in a hearing, but the ombudsman would normally want do this on paper. Therefore, it is necessary to have a situation in which a reasonable period of time is looked at. I would not suggest that there might not be cases in which it is right to allow more than 12 months. For that reason we have provided in subsection (3) for the ombudsman to have the power to disapply those time limits. However, we would very much see that as a decision for the ombudsman.

The ombudsman’s remit would not extend to self-funded adult social-care users until 1 October 2010, when the new CQC registration starts applying to adult social care. I am happy to write with more details on the impact assessment’s assumption about the 1,000 people; we shall go back, check the detail and report on the sources of that assumption. Our proposals in the Bill include the local government funding and money set aside to cover the establishment of a scheme.

Stephen O'Brien (Conservative, Eddisbury)

I am most grateful. That was helpful and I shall look forward to the letter covering the other point. I beg to ask leave to withdraw the amendment.