Health Act 1999

• Citation: 1999 c. 8
• Sections: 226

Section 1 Repeal of law about fund-holding practices.

In the National Health Service and Community Care Act 1990, sections 14 to 17 (which make provision in relation to fund-holding practices) are to cease to have effect.

Section 2 Primary Care Trusts.

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Section 3 Primary Care Trusts: finance.

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Section 4 Expenditure of Health Authorities and Primary Care Trusts.

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Section 5 Primary Care Trusts: provision of services etc.

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Section 6 Delegation of Health Authority functions relating to pilot schemes and section 28C arrangements.

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Section 7 Primary Care Trusts: trust-funds and trustees.

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Section 8 Payments relating to past performance.

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Section 9 Indemnity cover for Part II services.

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Section 10 Remuneration for Part II services.

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Section 11 Local representative committees.

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Section 12 Directions.

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Section 13 Establishment orders.

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(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(4) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5) An order under section 63 may—

(a) provide for any provision made by it for the purposes of, in consequence of or for giving full effect to this section to be treated as having had effect from a time before the commencement of this section,

(b) make such provision about an NHS trust dissolved before that commencement.

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(7) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(9) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(10) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(11) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Section 14 Exercise of powers.

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Section 15 Public dividend capital.

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Section 16 Existing NHS trusts: conversion of initial loan.

(1) This section applies to any NHS trust in existence immediately before commencement.

(2) On commencement so much of the originating capital debt of the NHS trust as remains outstanding immediately before commencement is to be treated as the originating capital of the NHS trust and accordingly is public dividend capital.

(3) Any reference in any enactment, instrument or other document to the originating capital debt of the NHS trust is to be construed (except where the context otherwise requires) as a reference to its originating capital.

(4) The Secretary of State may with the consent of the Treasury determine the amount and time for payment of interest on the NHS trust’s initial loan in respect of the period ending with commencement.

(5) In this section—

“ commencement ” means the coming into force of this section,

“ initial loan ” has the meaning given by section 9(5) of the National Health Service and Community Care Act 1990, prior to the repeal of that section by the National Health Service (Consequential Provisions) Act 2006

Section 17 Borrowing.

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Section 18 Duty of quality.

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Section 19 The Commission for Health Improvement.

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Section 20 Functions of the Commission.

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Section 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Section 22 Arrangements with Ministers.

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Section 23 Obtaining information etc.

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Section 24 Restrictions on disclosure of information.

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Section 25 Abolition of Clinical Standards Advisory Group.

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Section 26 Co-operation between NHS bodies.

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Section 27 Co-operation between NHS bodies and local authorities.

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Section 28 Plans for improving health etc.

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Section 29 Payments by NHS bodies to local authorities.

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Section 30 Payments by local authorities to NHS bodies.

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Section 31 Arrangements between NHS bodies and local authorities.

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Section 32 Joint consultative committees.

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Section 33 Powers relating to voluntary schemes.

(1) The powers conferred by this section may be exercised where there is in existence a scheme (referred to in this section and sections 34 and 35 as a voluntary scheme) made by the Secretary of State and the industry body for the purpose of—

(a) limiting the prices which may be charged by any manufacturer or supplier to whom the scheme relates for the supply of any health service medicines, or

(b) limiting the profits which may accrue to any manufacturer or supplier to whom the scheme relates in connection with the manufacture or supply of any health service medicines.

(2) For the purposes of this section and sections 34 and 35, a voluntary scheme is to be treated as applying to a manufacturer or supplier to whom it relates if—

(a) he has consented to the scheme being so treated (and has not withdrawn that consent), and

(b) no notice is in force in his case under subsection (4).

(3) For the purposes of this section a voluntary scheme has effect, in relation to a manufacturer or supplier to whom it applies, with any additions or modifications made by him and the Secretary of State.

(4) If any acts or omissions of any manufacturer or supplier to whom a voluntary scheme applies (a “ scheme member ”) have shown that, in the scheme member’s case, the scheme is ineffective for either of the purposes mentioned in subsection (1), the Secretary of State may by a written notice given to the scheme member determine that the scheme is not to apply to him.

(5) A notice under subsection (4) must give the Secretary of State’s reasons for giving the notice; and the Secretary of State may not give a notice under that subsection until he has given the scheme member an opportunity to make representations about the acts or omissions in question.

(6) Consent under subsection (2)(a) must be given, or withdrawn, in the manner required by the Secretary of State.

(7) The Secretary of State may after consultation with the industry body require any manufacturer or supplier to whom a voluntary scheme applies to—

(a) record and keep any information, and

(b) provide any information to the Secretary of State,

which the Secretary of State may require for the purpose of enabling the scheme to operate or facilitating its operation or for the purpose of giving full effect to any provision made under subsection (8).

(8) The Secretary of State may—

(a) prohibit any manufacturer or supplier to whom a voluntary scheme applies from increasing any price charged by him for the supply of any health service medicine covered by the scheme without the approval of the Secretary of State, and

(b) provide for any amount representing any increase in contravention of that prohibition in the sums charged by that person for that medicine, so far as the increase is attributable to supplies to the health service, to be paid to the Secretary of State within a specified period.

Section 34 Power to control prices.

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Section 35 Statutory schemes.

(1) The Secretary of State may, after consultation with the industry body, make a scheme (referred to in this section and section 36 as a statutory scheme) for the purpose of—

(a) limiting the prices which may be charged by any manufacturer or supplier for the supply of any health service medicines, or

(b) limiting the profits which may accrue to any manufacturer or supplier in connection with the manufacture or supply of any health service medicines.

(2) A statutory scheme may, in particular, make any provision mentioned in subsections (3) to (6).

(3) The scheme may require any manufacturer or supplier to whom it applies to—

(a) record and keep information, and

(b) provide information to the Secretary of State.

(4) The scheme may provide for any amount representing sums charged by any manufacturer or supplier to whom the scheme applies, in excess of the limits determined under the scheme, for health service medicines covered by the scheme to be paid by that person to the Secretary of State within a specified period.

(5) The scheme may provide for any amount representing the profits, in excess of the limits determined under the scheme, accruing to any manufacturer or supplier to whom the scheme applies in connection with the manufacture or supply of health service medicines covered by the scheme to be paid by that person to the Secretary of State within a specified period.

(6) The scheme may—

(a) prohibit any manufacturer or supplier to whom the scheme applies from increasing, without the approval of the Secretary of State, any price charged by him for the supply of any health service medicine covered by the scheme, and

(b) provide for any amount representing any increase in contravention of that prohibition in the sums charged by that person for that medicine, so far as the increase is attributable to supplies to the health service, to be paid to the Secretary of State within a specified period.

(7) A statutory scheme may not apply to a manufacturer or supplier to whom a voluntary scheme applies.

Section 36 Statutory schemes: supplementary.

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Section 37 Enforcement.

(1) Regulations may provide for a person who contravenes any provision of regulations or directions under sections 33 to 36 to be liable to pay a penalty to the Secretary of State.

(2) The penalty may be—

(a) a single penalty not exceeding £100,000, or

(b) a daily penalty not exceeding £10,000 for every day on which the contravention occurs or continues.

(3) Regulations may provide for any amount required to be paid to the Secretary of State by virtue of section 33(8)(b), 34(1)(b) or 35(4) or (6)(b) to be increased by an amount not exceeding 50 per cent.

(4) Regulations may provide for any amount payable to the Secretary of State by virtue of provision made under section 33(8)(b), 34(1)(b) or 35(4), (5) or (6)(b) (including such an amount as increased under subsection (3)) to carry interest at a rate specified or referred to in the regulations.

(5) Provision may be made by regulations for conferring on manufacturers and suppliers a right of appeal against enforcement decisions taken in respect of them in pursuance of sections 33 to 36 and this section.

(6) The provision which may be made by virtue of subsection (5) includes any provision which may be made by model provisions with respect to appeals under section 6 of the Deregulation and Contracting Out Act 1994, reading—

(a) the references in subsections (4) and (5) of that section to enforcement action as references to action taken to implement an enforcement decision,

(b) in subsection (5) of that section, the references to interested persons as references to any persons and the reference to any decision to take enforcement action as a reference to any enforcement decision.

(7) In subsections (5) and (6), “ enforcement decision ” means a decision of the Secretary of State or any other person to—

(a) require a specific manufacturer or supplier to provide information to him,

(b) limit, in respect of any specific manufacturer or supplier, any price or profit,

(c) refuse to give his approval to a price increase made by a specific manufacturer or supplier,

(d) require a specific manufacturer or supplier to pay any amount (including an amount by way of penalty) to him,

and in this subsection “ specific ” means specified in the decision.

(8) A requirement or prohibition, or a limit, under sections 33 to 36 may only be enforced under this section and may not be relied on in any proceedings other than proceedings under this section.

(9) In this section “ regulations ” means regulations made by the Secretary of State, and the Secretary of State must consult the industry body before making any regulations under this section.

(10) The Secretary of State may by order increase (or further increase) either of the sums mentioned in subsection (2).

Section 38 Controls: supplementary.

(1) Any power conferred on the Secretary of State by sections 33(6) to (8) and 34 to 36 may be exercised by—

(a) making regulations, or

(b) giving directions to a specific manufacturer or supplier,

and the regulations may themselves confer power for the Secretary of State to give directions to a specific manufacturer or supplier; and in this subsection “ specific ” means specified in the direction concerned.

(2) Any power to make regulations under any of those provisions or section 37 may be exercised generally in relation to manufacturers or suppliers of health service medicines or be exercised in relation to any class of manufacturers or suppliers.

(3) The powers to refuse approval under section 33(8)(a) or 35(6)(a) or to impose a limit under section 34(1)(a) or 35(1) are exercisable only with a view to limiting by reference to the prices or profits which would be reasonable in all the circumstances—

(a) the prices which may be charged for, or

(b) the profits which may accrue to any manufacturer or supplier in connection with,

the manufacture or supply for the purposes of the health service of health service medicines.

(4) In so exercising those powers (in the case of sections 34(1)(a) and 35(1) and (6)(a)) the Secretary of State and any other person must bear in mind, in particular, the need for medicinal products to be available for the health service on reasonable terms and the costs of research and development.

(5) Section 57 of, and Schedule 11 to, the 1977 Act and section 49 of, and Schedule 10 to, the 1978 Act (maximum prices of medical supplies) are to cease to have effect in relation to health service medicines; but the powers conferred by sections 33 to 36 do not affect any other powers of the Secretary of State to control prices or profits.

(6) This subsection and subsections (7) and (8) apply for the interpretation of sections 33 to 37 and this section—

“ health service ” means any of the health services within the meaning of the 1977 Act, the 1978 Act or the Health and Personal Social Services (Northern Ireland) Order 1972,

“ health service medicine ” means a medicinal product used to any extent for the purposes of the health service,

“ the industry body ” means any body which appears to the Secretary of State appropriate to represent manufacturers and suppliers,

“ manufacture ” includes assemble and “ manufacturer ” means any person who manufactures health service medicines,

“ medicinal product ” has the meaning given by section 130 of the Medicines Act 1968,

“ supplier ” means any person who supplies health service medicines.

(7) References to contravention of a provision include failure to comply with it.

(8) References to supplying medicines include selling them.

Section 39 Evasion of charges etc.

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Section 40 Disqualification etc. of Part II practitioners.

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Section 41 High security psychiatric services.

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Section 42 Provision of information by Registrar General.

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Section 43 Health Service Commissioners.

(1) Section 15 of the Health Service Commissioners Act 1993 (confidentiality of information) is amended as follows.

(2) In subsection (1), at the beginning of paragraph (e) there is inserted “ where the information is to the effect that any person is likely to constitute a threat to the health or safety of patients ” .

(3) Subsection (1A) is omitted.

(4) In subsection (1B)—

(a) for “such a case” there is substituted “ a case within subsection (1)(e) ” ,

(b) the words following “patients” are omitted.

(5) In subsection (1C), for paragraphs (a) and (b) there is substituted—

(a) where he knows the identity of the person mentioned in subsection (1)(e), inform that person that he has disclosed the information and of the identity of any person to whom he has disclosed it, and

(b) inform the person from whom the information was obtained that he has disclosed it

Section 44 Power to rectify transitional provisions etc.

(1) The Secretary of State may by order make such provision as he considers appropriate in consequence of the matters mentioned in subsection (2) (the “relevant defects”).

(2) Those matters are—

(a) the omission from Part III of Schedule 2 to the Health Authorities Act 1995 (Transitional Provisions) Order 1996 (which determined the relevant Health Authority in relation to any Family Health Services Authority in England whose locality comprised or formed part of the area of more than one Health Authority) of an entry for Bromley Family Health Services Authority,

(b) the inclusion in Part III or IV of Schedule 1 to that order (which determined the relevant Health Authority in relation to any Family Health Services Authority whose locality comprised or formed part of the area of only one Health Authority) of an entry for any Family Health Services Authority in England or Wales whose locality comprised or formed part of the area of more than one Health Authority (and an entry for which should accordingly have been included in Part III or IV of Schedule 2 to that order),

(c) the omission from column 2 of the entry for any Family Health Services Authority in Part III or IV of Schedule 2 to that order (which together with column 3 of that entry specified the relevant Health Authorities in relation to that Family Health Services Authority) of any Health Authority whose area or any part of whose area forms part of the locality of the Family Health Services Authority and which was not included in column 3 of that entry,

(d) where—

(i) the locality of a Family Health Services Authority and the area of a Health Authority overlap but do not coincide, and

(ii) the Family Health Services Authority had compiled a list of persons residing in its locality,

the treatment, incorrectly, by a Health Authority of a person included in that list as residing, or as not residing, in their area.

(3) Provision that may be made under subsection (1) includes, in particular—

(a) provision amending the Health Authorities Act 1995 (Transitional Provisions) Order 1996,

(b) provision transferring, or adding, the name of any Part II practitioner to any Part II list in which he is (or, at the material time, was) not included because of any of the relevant defects,

(c) provision for treating anything done by or in relation to an acting authority or a person of any description identified by reference to an acting authority as having been done by or in relation to the proper authority or a person of that description identified by reference to the proper authority,

(d) provision for treating anything done by or in relation to an acting authority or a person of any description identified by reference to an acting authority as having been so done in the exercise by them or him of functions on behalf of the proper authority or a person of that description identified by reference to the proper authority.

(4) Any provision made by an order under this section may be made with effect from any date after 31st March 1996 specified in the order.

(5) Provision contained in an order under this section by virtue of section 62(4) may include provision conferring functions on the Secretary of State.

(6) In subsection (3)(b)—

“ Part II practitioner ” means a person who provides (or, at any time since 31st March 1996, has provided) general medical services, general dental services, general ophthalmic services or pharmaceutical services in accordance with arrangements made or treated as made (or which, but for any of the relevant defects, would have been made or treated as made) under Part II of the 1977 Act,

“ Part II list ” means a list kept by a Health Authority under section 29(2)(a), 36(1)(a), 39(a) or 42(2)(a) of that Act (lists of persons providing general medical, general dental, general ophthalmic or pharmaceutical services).

(7) In subsection (3)(c) and (d), in relation to anything done by or in relation to a Health Authority or a person identified by reference to a Health Authority—

“ acting authority ” means the Health Authority by or in relation to whom the thing was done or person was identified because of any of the relevant defects,

“ proper authority ” means the Health Authority by or in relation to whom the thing should have been done or by reference to whom the person should have been identified.

Section 45 Repeal of law about fund-holding practices.

In the National Health Service (Scotland) Act 1978, sections 87A to 87C (which make provision in relation to fund-holding practices in Scotland) are to cease to have effect.

Section 46 Establishment orders.

(1) In section 12A of the 1978 Act (NHS trusts)—

(a) in subsection (1), for paragraphs (a) and (b) there is substituted “ to provide goods and services for the purposes of the health service ” ,

(b) for subsection (4) there is substituted—

(4) The functions which may be specified in an order under subsection (1) include a duty to provide goods or services so specified at, from, or through a hospital or other establishment or facility so specified.

(2) In section 108(1) (interpretation) after the definition of “property” there is inserted—

“ provide ” includes manage

(3) Any order under section 12A(1) of that Act—

(a) is to be treated as always having had effect with the omission of any obligation for the NHS trust to which the order relates to own land specified in the order, and

(b) so far as any functions specified in it could have been specified under that provision as amended by this Act, is to be treated as having been made under that provision as so amended.

(4) Any restriction preventing the acquisition by any NHS trust (including any NHS trust dissolved before the commencement of this section) of land merely because the land did not comprise a hospital or other establishment or facility previously managed or provided by a Health Board or the Agency is to be treated as never having had effect.

(5) An order under section 63 of this Act may—

(a) provide for any provision made by it for the purposes of, in consequence of, or for giving full effect to, this section to be treated as having had effect from a time before the commencement of this section,

(b) make such provision about an NHS trust dissolved before that commencement.

(6) In paragraph 3(2) of Schedule 7A to the 1978 Act (establishment orders), for “assume responsibility for the ownership and management of” there is substituted “ provide services at ” .

(7) In paragraph 3 of Schedule 7B to that Act (borrowing limits), in sub-paragraph (1), for the words from “established” to “manage” there is substituted “ which are required to provide services at or from ” .

(8) The 1978 Act is to be treated as always having had effect subject to the amendments made by this section.

Section 47 Directions as to delegation of functions.

After section 12A of the 1978 Act there is inserted—

Additional functions of NHS trusts.

(12AA) The Secretary of State may direct a Health Board to delegate to an NHS trust or NHS trusts some or all of their functions—

(a) under section 2(1) of making arrangements on his behalf for the provision of services mentioned in Part II; or

(b) relating to pilot schemes under Part I of the National Health Service (Primary Care) Act 1997; or

(c) relating to arrangements under section 17C for the provision of personal medical services and personal dental services.

Section 48 Constitution of NHS trust boards.

In section 12A of the 1978 Act (NHS trusts), in subsection (3), for paragraph (a) there is substituted—

(a) shall be a body corporate having a board of directors consisting of a chairman who is not an employee of the trust, appointed by the Secretary of State; and, subject to paragraph 5(2) of Schedule 7A, executive directors (directors who, subject to subsection (5), are employees of the trust) and non-executive directors (directors who, subject to subsection (5), are not employees of the trust and who shall be known as “trustees”)

Section 49 Duties of NHS trusts.

(1) Paragraph 6 of Schedule 7A to the 1978 Act is amended as follows.

(2) For sub-paragraph (1) there is substituted—

(1) In carrying out the functions for the time being conferred on it an NHS trust shall comply with any directions given to it by the Secretary of State, whether of a general or of a particular nature.

(3) Sub-paragraph (2) is omitted.

Section 50 Transfer of staff among health service bodies.

After section 12C of the 1978 Act there is inserted—

Transfer of staff among health service bodies.

(12CA)

(1) This section applies to any person who is—

(a) employed by a health service body (the transferor authority) and is transferred to another health service body (the transferee authority) because a function of the transferor authority is transferred to the transferee authority; and

(b) designated for the purposes of this section by a scheme made by the transferor authority.

(2) A scheme under this section shall not have effect unless approved by the Secretary of State.

(3) The contract of employment between a person to whom this section applies and the transferor authority shall have effect from the transfer date as if originally made between him and the transferee authority.

(4) Without prejudice to subsection (3)—

(a) all the transferor authority’s rights, powers, duties and liabilities under or in connection with a contract to which that subsection applies shall by virtue of this section be transferred to the transferee authority on the transfer date; and

(b) anything done before the transfer date by or in relation to the transferor authority in respect of that contract shall be deemed from that date to have been done by or in relation to the transferee authority.

(5) Subsections (3) and (4) are without prejudice to any right of an employee to terminate his contract of employment if a substantial change is made to his detriment in his working conditions; but no such right shall arise by reason only of the change in employer effected by this section.

(6) A scheme under this section may designate a person either individually or as a member of a class or description of employees.

(7) In this section—

a “health service body” is a body mentioned in section 17A(2); and

the “transfer date” is the date on which the function is transferred from the transferor authority to the transferee authority.