Health Bill (Ninth sitting)
House of Commons · Public Bill Committees · 30 Jun 2026 · 92 speeches · Official Report
The Committee consisted of the following Members:
Chairs: Sir Roger Gale, Dr Rupa Huq, Emma Lewell, † Sir Jeremy Wright
† Argar, Edward (Melton and Syston) (Con)
Brackenridge, Sureena (Wolverhampton North East) (Lab)
† Chambers, Dr Danny (Winchester) (LD)
Daby, Janet (Lewisham East) (Lab)
† Foody, Emma (Cramlington and Killingworth) (Lab/Co-op)
Irons, Natasha (Croydon East) (Lab)
† Johnson, Dr Caroline (Sleaford and North Hykeham) (Con)
† Joseph, Sojan (Ashford) (Lab)
† Kyrke-Smith, Laura (Aylesbury) (Lab)
† Morgan, Helen (North Shropshire) (LD)
† Prinsley, Dr Peter (Bury St Edmunds and Stowmarket) (Lab)
† Robertson, Dave (Lichfield) (Lab)
† Robertson, Joe (Isle of Wight East) (Con)
† Smyth, Karin (Minister for Secondary Care)
† Stafford, Gregory (Farnham and Bordon) (Con)
† Twist, Liz (Blaydon and Consett) (Lab)
† White, Jo (Bassetlaw) (Lab)
Sanjana Balakrishnan, Rob Cope, Committee Clerks
† attended the Committee
Public Bill Committee
Tuesday 30 June 2026
(Afternoon)
[Sir Jeremy Wright in the Chair ]
Health Bill
Clause 31
NHS foundation trusts etc: audit of accounts
Question (this day) again proposed, That the clause stand part of the Bill.
The Chair
I remind the Committee that with this we are considering the following: Schedule 4. Clauses 32 to 34 stand part.
I will start where I left off. Clause 34 addresses the gap by making it clear where responsibility sits, so that there is no doubt about who must produce the final accounts and ensure that they are completed properly, and about how those accounts should be audited. We think this is a proportionate provision to ensure continuity and clarity on how NHS money has been managed during organisational transition. I commend the clauses to the Committee.
Clause 31 introduces schedule 4, which essentially makes series of amendments to other Acts. It amends the Public Finance and Accountability (Scotland) Act 2000 to remove a cross-reference to other categories, and it amends the Audit and Accountability (Northern Ireland) Order 2003 and the Public Audit (Wales) Act 2004 for similar purposes. It also amends the National Health Service Act 2006 by deleting section 62 and schedule 10, relating to the audit of accounts of NHS foundation trusts, to end the old audit scheme. Schedule 4 amends section 3 of the Local Audit and Accountability Act 2014 so that foundation trusts are now included in the list of bodies that must keep accounts in the standard way, it amends section 4 to specify which documents count as accounts of foundation trusts for the purpose of auditing, and it amends sections 8 and 10 so that the auditor appointment procedure and the auditor panel’s role now cover foundation trusts. In addition, schedule 4 rewrites section 13 of the 2014 Act so that if a trust fails to appoint a local auditor, it is the Secretary of State’s job to step in. Previously, that was NHS England’s job; clearly, that needs to change, because NHS England is being abolished. The schedule also amends section 21 so that the auditors’ general duties now apply to foundation trusts too, and it amends section 30, relating to unlawful expenditure and activity, and section 32B, relating to the independence requirement, to remove a now-redundant item...
My hon. Friend is making a prescient point. Has she thought about the word “limits”? To me, it is not clear from the clause as drafted-perhaps it is clearer to her-whether that is an overall limit on capital and revenue expenditure, or whether the clause is saying that the Secretary of State could impose limits on individual line items or departments. The word “limits”-plural-suggests that he or she may be able to do that.
I do not think the Bill is very clear on that. It says that the Secretary of State “may by order impose limits on the expenditure that may be incurred by an NHS foundation trust in respect of a single financial year.” However, it does not say whether that is an overall limit, whether it is for capital or revenue or whether it is a limit on a specific item, so the degree to which the Secretary of State has control is not clear. I presume it is an overall limit and that it is for dealing with budgets, but perhaps the Minister can provide some clarity for my hon. Friend. Clause 34 requires foundation trusts that have been newly authorised, or that have recently acquired another trust or another foundation trust, to prepare the final accounts for their predecessor trust or foundation trust. It does that by modifying section 36 of the NHS Act 2006 to add new provisions that require foundation trusts to prepare accounts for the final period for which they were an NHS trust, establish that part of schedule 7 and part of the Local Audit and Accountability Act 2014 apply in relation to those accounts, and define the final accounting period. It does the same for section 56AA of the 2006 Act.
I thank the shadow Minister for in general, I think, agreeing that the alignment of many of these processes is quite sensible. The shadow Minister talked in general terms about financial controls. The Government take financial controls and our responsibility for taxpayers’ money very seriously. As I said last week, from very early on, we were very keen to ensure that there is a grip on NHS finances in order to properly deliver the sort of healthcare that all our constituents deserve. We take that very seriously. There has not been that sort of grip at board level and through the system in recent years. As a result of the measures that we have taken, I think this is the first year in six or more years that the NHS has not gone back to the Department for additional funds to get through the year. The Committee can be assured that financial control is important. The shadow Minister referred to limits. Of course they are overall limits; the Secretary of State does not go line by line through what a trust spends. I understand the point that people are trying to make to conflate some situations, but of course it is an overall limit. The safeguards in these provisions are designed to protect foundation trusts’ freedoms and not constrain them, but a foundation trust can enjoy such freedoms only if it is in a well-overseen and stable NHS financial system. By including a backstop for use in exceptional circumstances, clause 33 helps to safeguard public funds and will help the...
The Chair
With this it will be convenient to discuss the following: Schedule 5. Clauses 36 to 38 stand part. Schedule 6.
During the process of producing our 10-year plan, we were clear that, as much as we will reward the best performing providers with new freedoms to innovate, we will not hesitate to act on poor performance, and this group of measures deal with just that: action in the event of a failing provider. Clause 35 and schedule 5 insert new provisions into the NHS Act 2006 to enable the Secretary of State to, by order, convert a failing foundation trust to an NHS trust. This is intended to take place only in the most critical circumstances, and where it is in the public’s best interest for the Secretary of State to be able to direct the trust about how it should exercise its functions, to address safety or other issues at the trust. Foundation trust status should be a mark of good performance, and there must be a mechanism to remove it when performance is seriously deficient. This deauthorisation power will help to maintain the integrity of the reinvigorated foundation trust status and provide an additional incentive for challenged foundation trusts to improve. The power to make a conversion order can be used where the foundation trust has failed to comply with a condition of its provider licence or with another legislative requirement. In deciding whether to make a conversion order, the Secretary of State must consider various factors, including the seriousness of the failure, the health and safety of patients, the quality of the provision by the trust of goods and services, the...
Clause 35 essentially establishes the right of the Secretary of State to convert a foundation trust into an NHS trust in certain circumstances. Currently, section 25 of the NHS Act 2006 establishes trusts and introduces schedule 4 of the same Act, which makes provision about NHS trusts. Section 56AA sets out how additional requirements concerning acquisitions of a trust or foundation trust are to work. Clause 35 deletes section 25(2), which specifies that an order in this context is referred to as “an NHS trust order”, and amends subsection (3), so that no order under section 25-previously no “NHS trust order”-can be made until any consultation that has been prescribed is complete. Clause 35 introduces proposed new section 57B into the 2006 Act, “Conversion of failing NHS foundation trust into NHS trust”, which provides the Secretary of State with the power to convert if the foundation trust breaches its licence or other legal duties. The trigger is broad and includes non-compliance with any statutory requirement. The proposed new section requires an order to specify when it takes effect and also requires the Secretary of State, when deciding to issue an order, to consider among other things “the seriousness of the failure…the health and safety of patients…the quality of the provision by the trust of goods and services…the financial position of the trust, and…the way that the trust is being run.” Before making an order, the Secretary of State will be required to consult the...
My next question is about the continuity of care for patients. The CQC looked into the Cliff Villages medical practice-a practice, rather than a trust, in my constituency-and the surgery was found to be wanting in a number of ways. The CQC removed the licence, which meant that medical services could no longer be provided by the surgery with immediate effect, so patients were immediately left without services at that surgery. The ICB managed, by working very hard, to get the surgery reopened on the Monday morning, but when someone is coming into a trust or a foundation trust-into A&E services and such like-their need may be significantly more acute.
In the event of a failing trust, can the Minister describe how services to patients will be maintained and made safe while that process is ongoing? If something is so unsafe that the trust is considered to have failed, meaning that the service needs to be improved, how does the Minister intend to manage that interim period? A surgery might be able to close for three or four days, but that cannot happen with a hospital, particularly if it is in a more remote location with no immediate alternatives.
I also have a question about how we will manage part of the trust failing. If there is a department within a trust, or if a trust runs several different hospitals-I should declare that I work for a trust that does that-and one hospital or department is thought to be delivering a poor service while the others are delivering a good service, how does this process work? I presume that they would all be taken over, but it is not 100% clear.
Clause 36 gives the Secretary of State powers over failing trust governance. Currently, section 111 in the Health and Social Care Act 2012, “Imposition of licence conditions on NHS foundation trusts”, enables NHS England to impose additional licence conditions on a foundation trust if NHS England
“is satisfied that the governance of an NHS foundation trust is such that the trust will fail to comply with the conditions of its licence”.
For NHS England to intervene, the council of governors, the board of directors or both must be failing
“to secure compliance with conditions in the trust’s licence, or…to take steps to reduce the risk of a breach of a condition in the trust’s licence.”
If they are failing to take steps to reduce the risk of a breach of the licence, NHS England can modify the membership of the council of governors. This section clearly needs amending because of the many references to NHS England.
The clause replaces that section entirely. The key elements include enabling the Secretary of State to introduce governance-related licence conditions where they are satisfied that the trust’s governance means it will fail to comply with its licence conditions. The Secretary of State has the power to alter the conditions after they have been imposed. Can the Minister comment on that?
The clause defines poor governance in the same terms as section 111 of the 2012 Act. It enables the imposition of additional conditions where the CQC has issued a warning notice. It allows that, where the trust breaches conditions, the Secretary of State can require the trust to remove executive directors, appoint interim executive directors and suspend or prevent reappointment for a specified period. The Secretary of State can take these actions directly if the trust fails to comply with the notice. The clause also removes sections 112 to 114, which currently ensure that section 111 is time limited. That makes the power a permanent part of the new regime.
NHS England had the power to introduce additional licence conditions and even intervene in the membership of the councils of governors. The direct link to the CQC allows for action when patient safety is at risk. For the health service to be democratically accountable, Governments need the power to act when hospitals fail. Foundation trusts, although more independent, are not immune from failure.
The power also allows the Secretary of State to act if the board were to block action. We heard earlier this week about members of senior leadership teams not engaging in inquiries. I understand that the Government will change the law on that issue, but the clause gives the Government the power to intervene if that were to happen. The Government need to consider the balance in how they define failure and how they ensure that their decisions are not political, but material to the care that is being provided. Can the Minister comment on how that balance will be struck?
Clause 37 removes the special financial assistance provisions for foundation trusts in special administration cases. The provisions are specific to NHS England under section 134 of the Health and Social Care Act 2012, “Duty to establish mechanisms for providing financial assistance”, which sets out that NHS England has a duty to establish mechanisms to provide financial assistance in instances where a health special administration order has been issued.
Clause 37 amends section 134 to remove the requirement for NHSE to maintain financial assistance mechanisms for foundation trusts in special administration. It amends section 134(2)(a) of the 2012 Act to remove a reference to financial assistance provided under section 65D(12) of the NHS Act 2006, and amends section 136(10) of the 2012 Act to change the definition of “special administrator” so that it no longer includes a trust special administrator appointed for a foundation trust. It also amends section 144(3) of the 2012 Act to remove the requirement to review the operation of the foundation trust special administration finance assistance regime. Clause 37 is essentially a consequence of clause 1, which abolishes NHS England, because the Secretary of State is taking over and already has power to provide financial assistance to the foundation trusts in such instances, so NHS England does not need that power as well.
Clause 38 introduces schedule 6, which relates to special administration for trusts and foundation trusts. Essentially, schedule 6 replaces NHS England with the Secretary of State in the trust special administration regime, which seems necessary because of the abolition of NHS England. It gives the Secretary of State responsibility for appointing a trust special administrator for NHS trusts and foundation trusts where serious failure or insolvency-related concerns arise. It requires consultation with relevant ICBs, relevant service recipients and the CQC before the appointment of the trust special administrator. It also requires the Secretary of State to lay a report before Parliament that explains the reasons for appointing a trust special administrator.
Schedule 6 provides that once such a trust special administrator is appointed, the trust’s chair and directors are suspended, although that does not affect the executive directors’ employment status. It requires the administrator to produce a draft report, consult relevant parties and then produce a final report with recommendations. It requires the Secretary of State to decide what action to take after receiving the final report, to publish a decision and to give reasons. It clarifies powers relating to the dissolution of trusts, the ending of administrator appointments, and the transfer of property, liabilities or functions where needed. It also removes a separate statutory objective for trust special administration in relation to foundation trusts.
In many ways, these changes align with the new operational structure after the abolition of NHS England. Unlike many things that the Government are doing, there are clear timeframes guaranteeing a clear public record of why intervention was needed: the TSA appointment must be made within five working days of the order being made; the draft report must be produced within 65 days; the final report is due within 15 days after the consultation period; and the Secretary of State must make a decision on what to do within 20 days.
I have a question: the Secretary of State would consult with the CQC but the CQC would no longer be able to initiate the appointment of the TSA and approve the final report. That weakens the role of the regulator, yet in so many other ways the Government wish to strengthen the role of the CQC and give it more and more to do, so why have the Government made that decision? Will the Minister talk about that in her summing-up?
I will endeavour to be relatively brief in my reflections, and I will address, particularly, clauses 35 and 38. I can see a logic to what the Minister proposes in them. On clause 35, we know that foundation trusts face challenges. We saw that writ large with the scandal at Mid Staffs, and in my time as a Minister, several foundation trusts required intervention-maybe not on that scale-or required improvement. I pick on them just because they are in my head-I do not know the situation today. I am looking across at the hon. Member for Ashford, because going back some years to when I was a Minister, East Kent hospitals NHS foundation trust faced some considerable challenges. I am not necessarily saying that that meets the bar for intervention, but foundation trusts have challenges from time to time. I should also declare an interest: I was born in the forerunner of the William Harvey hospital-the old Willesborough hospital-in the hon. Member’s constituency. I recognise that on occasions foundation trusts get into serious, or less serious but still challenging, circumstances. So I can see where the Minister is coming from, but I have a few questions for her. First, we recognise that although foundation trusts can get into bother, so too can NHS trusts. NHS trusts can underperform, have safety issues or have financial or other performance issues. I am interested to hear the Minister’s reflections on why she believes that removing foundation status and the organisation becoming an...
As people who have been listening will know, this is a chunky set of clauses on some technical details. Let me broadly pick up some of the key points. I want to be very clear about deauthorisation and our seeking to establish, essentially, a more dynamic model. As I said, the coalition Government repealed the legislation on deauthorisation in the 2012 Act. Although other regulatory levers exist to manage poor performance, we are using two core arguments. First, converting foundation trusts into NHS trusts will enable the Secretary of State, if needed, to intervene further through their power of direction over NHS trusts. The Secretary of State will therefore be able to focus on the patient and public interest over preservation of providers’ statutory freedoms in cases of serious failure. I hope that that addresses some of the points that have been raised. Secondly, having a more dynamic environment with the potential for deauthorisation in such cases, and the consequent loss of statutory autonomy, may act as an incentive for challenged foundation trusts to improve, and it would show that there are consequences. As I think the hon. Member for Sleaford and North Hykeham knows, the usual processes exist for managing performance across various aspects of the provider. They will continue. This is for exceptional circumstances. As I said, this is about maintaining a more dynamic model than the one we have. The purpose behind her questions about continuous service-the purpose of...
Question proposed, That the clause stand part of the Bill.
The Chair
With this it will be convenient to discuss the following: Government new clause 20. New clause 26- Arrangements between NHS bodies and local authorities: duty to review - “(1) The Secretary of State must conduct a review of the effectiveness of arrangements entered into by NHS bodies and local authorities under section 75 of the National Health Service Act 2006 (arrangements between NHS bodies and local authorities). (2) In conducting the review, the Secretary of State must consult- (a) NHS bodies, (b) local authorities, and (c) any another person that the Secretary of State considers it appropriate to consult. (3) Having conducted the review, the Secretary of State must consider whether the power to make regulations in section 75(1) or the power to issue guidance in section 75(6) of the National Health Service Act 2006 should be exercised in order to improve the effectiveness of arrangements under that section. (4) The Secretary of State must lay before Parliament, and publish, a report of the review. (5) The report of the review must explain whether the Secretary of State decided to exercise the powers in section 75(1) and (6) of the National Health Service Act 2006 and the reasons for that decision. (6) The Secretary of State must comply with the requirements of this section before the end of the 12-month period beginning with the day on which this Act is passed.” This new clause requires the Secretary of State to conduct a review into arrangements under section 75 of the...
Government new clause 20 and clause 39 both look to strengthen joint working arrangements across the health system. Clause 39 is part of the architecture of the Bill that allows the delegation of functions from the Secretary of State to NHS bodies, local authorities or other relevant organisations. The clause builds on the existing delegation powers in section 65Z5 of the National Health Service Act 2006, which already allow NHS bodies to delegate functions and pool resources with one another and with local authorities or other relevant bodies on a voluntary basis. It is a well-used voluntary power that enables systems to develop joint working and ensure that health functions are carried out by the most appropriate body or groups of bodies. The result is stronger integration, with better joint working between NHS and local government, and services better tailored to meet local needs. With the abolition of NHS England and the new functions of the Secretary of State, it is right that the Secretary of State should have the flexibility to delegate their health functions appropriately and efficiently under a voluntary arrangement, as and when necessary. We would not want to exclude the Secretary of State from joint working arrangements, if joint working would bring benefits to patients and the public. The power is therefore purposefully broad to allow that, including allowing the Secretary of State to delegate to a range of public bodies, establish joint committees and pool...
The Chair
I do not think that the Minister addressed new clause 26, so does she wish to do so now? [ Interruption. ] She need not worry about it, I am told.
Clause 39 broadens the Secretary of State’s ability to delegate or jointly exercise health service functions with NHS bodies and local government. Currently, section 7A of the National Health Service Act 2006 enables the Secretary of State to arrange for any of their public health functions to be exercised by relevant bodies, such as NHS England, ICBs and local authorities. Section 65Z5 sets out how relevant bodies may jointly exercise delegated functions, and section 65Z6 sets out how funds may be pooled for such purposes. Section 65Z7 sets out that NHS England may issue guidance for exercising functions under those two sections and that relevant bodies must have regard to any guidance. Section 75 then sets out that the Secretary of State can make regulations to enable NHS bodies and local authorities to enter into arrangements related to the delivery of health functions. Clause 39 deletes section 7A, removing the separate power for the Secretary of State to delegate public health functions. It amends section 65Z5 to create a wider power that allows the Secretary of State to arrange for any health service-related function in England to be exercised by or jointly with relevant bodies, local authorities, combined authorities, combined county authorities or other prescribed persons. It removes outdated references in section 65Z5 linked to NHS England and updates the wording so that arrangements can be made with a wider range of persons and not just bodies. Clause 39 also...
New clause 26, tabled by my hon. Friend the Member for Oxford West and Abingdon (Layla Moran) and the hon. Member for Worthing West (Dr Cooper), who both sit on the Health and Social Care Committee, would require the Secretary of State to review the arrangements under section 75 of the National Health Service Act 2006 and consider whether to require NHS bodies and local authorities to enter into new arrangements with one another if that is likely to lead to an improvement in how their functions are exercised. A recurring theme of Health and Social Care Committee inquiries is the impact of financial flows and how they frustrate attempts to deliver truly integrated care-an issue we discussed in earlier sittings. We all recognise that closer arrangements are needed to properly address discharge delays, which directly lead to corridor care or even unnecessary admissions to hospital. It seems that a consensus has been reached, yet the action to back that up is not there. We feel that, through this Bill, the Government are moving away from closer integration. Melanie Williams, the then president of the Association of Directors of Adult Social Services, told the Health and Social Care Committee that the NHS and local authorities “spend a lot of time debating about who pays, rather than having a conversation about how, in the longer term, we can invest in people’s outcomes to enable better health and wellbeing.” She highlighted concerns about the funding of intermediate care and...
I want to touch briefly on clause 39, Government new clause 20, and new clause 26, tabled by the hon. Member for Oxford West and Abingdon in her role as Chair of the Health and Social Care Committee. I recognise the intention behind clause 39. Greater collaboration between the NHS, local authorities and other public bodies has the potential to improve the co-ordination of services and deliver a more integrated approach to population health, which I think we all welcome. However, it sits slightly uncomfortably with other clauses we have debated that appear to draw local authorities and the NHS further apart. In this case, it looks like they may be brought together. As the clause expands delegation and joint working powers, I would be interested to understand from the Minister where the oversight and safeguards for accountability for spending the joint budgets would sit. Would it be with the NHS, local authorities or somewhere else? We hope that everything goes well, but if services fail or financial problems emerge, the public deserve to know who precisely is accountable for those budgets. As I have said in debates on numerous other clauses, I continue to be concerned by the broad powers that the Bill gives to the Secretary of State. I have the same concerns about this clause. On Government new clause 20, bringing health services and wider local government functions together is really important, particularly where combined authorities have responsibilities that affect the...
I got a little confused at the end, but I think the Opposition generally accept the power in this clause. The hon. Member for Farnham and Bordon contended that this Bill and previous amendments to it will drive local authorities and the NHS further apart; just to have it on the record, I do not accept that that is true at all. Section 75 of the National Health Service Act 2006 and the work that we are doing on this further highlights the effect of some of the things that we are trying to do. The hon. Member for Winchester raised new clause 26. I have sympathy for the intention behind the new clause. We all want health and care services to work closer together, as I have said repeatedly, and we agree that the partnership framework under section 75 of the National Health Service Act 2006 is a useful tool for doing so. While I understand the new clause, it is not necessary. The Department can review the section 75 framework without needing legislation, and indeed it has already done so. The Department carried out a review of section 75 in 2023, as has been said. Since then, we have continued to consider how these partnership arrangements can best support health and care integration. The new clause would risk duplicating ongoing work. Furthermore, that work is not a one-off exercise but an ongoing process of learning and improvement across the country, and we want something that is responsive and flexible enough to respond to changes in health and care services and to the...
The Chair
With this it will be convenient to discuss clauses 41 and 42 stand part.
We know that robust finances are an essential part of the health service. The financial accounts related to the NHS are of keen interest to His Majesty’s Treasury and indeed to Parliament. The Government are especially mindful of the keen interest of the Public Accounts Committee in this area. Under current arrangements, NHS England prepares a set of financial accounts for all NHS trusts and foundation trusts, and that is audited by the National Audit Office. That is the point at which the National Audit Office conducts its oversight of NHS providers, with that feeding into the National Audit Office’s assurance over the Department of Health and Social Care group. The financial accounts for integrated care boards are currently included in the NHS England group accounts, which are presented separately and audited by the National Audit Office. With the abolition of NHS England, the Government intend to reduce central administration costs, so financial reporting needs to be proportionate while balancing stakeholders’ keen interest in financial information related specifically to the NHS. Clause 40 therefore replaces the current consolidated accounts of NHS providers with a single set of consolidated accounts for the NHS covering its trusts, foundation trusts and integrated care boards. That consolidated account will continue to be audited by the National Audit Office. We believe that bringing the accounts together in this way will assist the public, Parliament and the National...
Clause 40 prepares for the preparation of the annual accounts of NHS trusts and integrated care boards. Existing legislation in section 65Z4 of the NHS Act 2006, “Consolidated accounts for NHS trusts and NHS foundation trusts”, requires NHS England to prepare a set of accounts every financial year and consolidate the accounts of all the trusts and NHS foundation trusts. The Secretary of State can give directions about the content for methods and principles, and the accounts must be accompanied by reports or other information as directed by the Secretary of State. A copy may be sent by NHS England to the Secretary of State and the Comptroller and Auditor General. The latter must then examine and certify those accounts before sending a copy to the Secretary of State and NHS England, and NHS England must then lay a copy of the consolidated accounts and the Comptroller and Auditor General’s report before Parliament. That is how it works at the moment. Clause 40 rewrites section 65Z4 and the duty to prepare the consolidated accounts every financial year moves to the Secretary of State, and the list of what gets consolidated now includes the ICB accounts. The power to give directions to NHS England about accounts is removed, which is fair enough because there would be no need for it, as the Secretary of State is now preparing them and NHS England will cease to exist. The requirement for the accounts to be accompanied by such reports or other information as the Secretary of State...
I have just a couple of questions for the Minister. Could that make ICBs less willing to set up companies for business services or joint ventures, potentially hampering innovation? If an ICB company generates liabilities that an ICB cannot meet, who becomes liable? If it is the ICB, is that not essentially the Government, in any case? If the ICBs need to purchase commercial insurance or hold contingency, which is the Government’s preference and what sort of cost will that entail?
Clause 42 changes parts of the NHS Act 2006 and the Health and Care Act 2022 concerning NHS England’s funding and financial responsibilities. Currently, the NHS Act 2006 contains sections relating to NHS England’s finances, including section 223B, “Funding of NHS England”; section 223C, “Financial duties of NHS England: expenditure”; section 223CA, “NHS England: banking facilities”; section 223D, “Financial duties of NHS England: controls on total resource use”; section 223E, “Financial duties of NHS England: additional controls on resource use”; and section 223F, “Power to establish contingency fund”. There are sections in the Health and Care Act 2022 concerning NHS England’s financial responsibilities and the expansion of its duties in respect of expenditure. Essentially, they are all deleted by clause 42.
I will be relatively brief, turning just to clause 40. I hope the Minister may be able to clarify something for me. I take the opportunity to thank the Minister for the letter that I received this morning, which was a very prompt response to her promise to write to me last week. In respect of clause 40 and subsequent clauses, I can see the logic of updating the legislation to reflect the abolition of NHS England and the changes that come with that. I can also see the logic of a consolidated set of accounts so that one can see the national, or overall, picture. In the interests of transparency, I would be grateful if the Minister could confirm that that will be in addition to, and in no way replace, every individual trust having to produce granular public accounts that anyone can inspect, so that we can see not only the overall operation and financial health of the system but that of each of its individual component parts sitting beneath.
I wish to carry on the point that my right hon. Friend the Member for Melton and Syston has just raised. He rightly says that there is a transparency element to this, so that the public and any other interested party can look at the individual accounts of an ICB or a trust. Going further than that on the technical elements, my understanding is that NHS England’s own guidance notes suggest that consolidation does not just bring accounting under one set of accounts, one umbrella or one document. Within that accounting, however, adjustments and eliminations of transactions between NHS bodies can happen. Therefore, the aggregated figures do not necessarily reflect the financial reality of individual organisations. I understand why that might be entirely appropriate from an accounting point of view, but it can make it harder for external observers to understand exactly where the pressures are coming from, where they are concentrated and, in a world where we want accountability, who should be held responsible for addressing them. That is all I need to say on that point.
I am pleased that, in an outbreak of cross-party agreement at 3.20 pm on a Tuesday, I completely agree with the comments made by the hon. Member for Farnham and Bordon and the right hon. Member for Melton and Syston. It is a point that I made myself: the ability of Members of Parliament and the public to understand the granularity relating to their local providers and ICBs is very important for transparency and accountability. I hope Committee members recognise that I have tried to drive much more transparency in that system. They are absolutely right that that is separate from this clause, and we will continue to expect providers and ICBs to do that; I hope that addresses that point. To add further clarity on the wider point the clause deals with, the consolidated accounts we prepare include some analysis by different types of body. That will mean separate information about NHS providers being included in the document, such as a summary of income and expenditure. Separately, providers and ICBs will continue to publish accounts so that people can look at those. The Government will listen to any feedback from users to adapt the nature of this content in future years after the initial publication, recognising that this is a new development following the abolition of NHS England. We are also mindful that too many separate publications add to administrative costs and risk losing focus. The intention is to have transparency at the local level, building that up to do something...
A djourned till Thursday 2 July at half - past Eleven o’clock.
Written evidence reported to the House
HB85 Alder Hey Children’s Charity
HB86 Graham Lake
HB87 Royal College of Speech and Language Therapists
HB88 Association of British HealthTech Industries (ABHI)
HB89 Health Connect Global
HB90 Alexion, AstraZeneca Rare Disease
HB91 The King’s Fund
HB92 Cleft Lip and Palate Action (CLAPA)
HB93 Royal College of Nursing
HB94 Vitanium Healthcare
HB95 The Health Tech Alliance
HB96 Marie Curie
HB97 Association of the British Pharmaceutical Industry (ABPI)
HB98 Rainbow Hospitality
HB99 Together for Short Lives (supplementary)
HB100 Council of Governors of University Hospitals of Morecambe Bay NHS Foundation Trust