Why is the government putting health watchdogs on the leash of ‘promoting economic growth’?

Lord Tunnicliffe asked in Parliament on November 20, 2014: “are these new clauses a licence for regulators to approve regulations that kill people to save money?”

Jen Persson
25 February 2015

Image: Health watchdogs, tamed? Credit: Uncyclopedia.

Imagine an unsafe care home where children or the elderly are at risk. 

Imagine its staff with fewer professional registration requirements than today. 

Imagine the home could legally reject a Care Quality Commission call for changes, citing that to do so would harm the home’s “economic growth”.

Could this ever be reality, if this controversial clause 88(2) of the Deregulation Bill becomes law?

In bingo, the number 88 is jokily nicknamed ‘two fat ladies.’

But this clause 88 could have serious implications across health and social care, affecting all of us - from preventing accidents and ill health; to safeguarding the use of human tissues, our reproductive health, and our medicines standards; and to the care standards we can all expect in our old age.

The Deregulation Bill has been in parliament for 18 months and is in House of Lords for its final stages before the 3rd reading on 4 March. My bet is that few beyond their benches and MPs, have had their eyes down on the detail.

The Deregulation Bill - What is the very big bill all about?

The Deregulation Bill has had little coverage in the media though Richard Grimes addressed some of the concerns on openDemocracy in September 2013.

The Deregulation Bill is as big and bloated in its content as its title is bland. But it has the potential to be a bombshell.

It covers subjects as diverse as busking and the Breeding of Dogs Act. It includes changes to how the police can obtain confidential material from journalists and provides a gateway to sell information from birth, death, marriage and civil partnership records.

Some changes in law will specifically affect the NHS; ‘Road traffic legislation: use of vehicles in emergency response’, and ‘NHS foundation trusts and NHS trusts: acquisitions and dissolutions’.

Other clauses affect services across the board, including the NHS. My ‘bingo clause’, Clause 88(2), is one of these. It creates a new legal duty for regulators to give regard to promoting economic growth.

The term ‘regulators’ covers a wide range of organisations. You might think of Ofwat responsible for oversight of water and sewage, or the Food Standards Agency, or Forestry Commission. 

It will also include all those in health and social care.

Ken Clarke MP, joint bill owner with Oliver Letwin MP, wrote in 2013: This is the beginning of a fundamental change in the culture of government. We think Reagan would have approved. 

“By putting a duty on regulators not to burden business with unnecessary red tape, it will help to ensure that every nook and cranny of Whitehall is relentlessly focused on growth.”

Will the Deregulation Bill take a gamble with the public interest in our NHS health and social care provision through the ‘relentless’ duty to promote profit in Clause 88(2)?

Slimming down laws and the administration processes they affect, could be a very good thing.

Lord Hunt of King’s Heath says of the bill as a whole: “I’ve no problem trying to streamline the regulatory processes, that’s why we broadly support it.”

But is Letwin and Clarke’s ‘relentless focus on growth’ going to mean compromise in worker safety, or in patient protection in the health and social care market? 

Clause 88(2): regulators to have a duty to promote economic growth

Lord Hunt shared his key concern with clause 88(2), saying

 “In earlier discussion with ministers it was made clear they have a preliminary list of 5 regulators that they consider [in health] would fall under the economic growth clause in the bill: The Care Quality Commission (CQC), the Human Fertilisation and Embryology Authority (HFEA), the Human Tissue Authority (HTA), the Medicines and Healthcare Products Regulatory Agency (MHRA) and the Professional Standards Authority. 

“I cannot for the life of me, see why the health regulators are in there. I hope that the government will be able to take some, or all of them out.”

Lord Hunt proposed an amendment to ring-fence some of the health and social care regulators from the effects of Clause 88 (2).

But the government did not support the amendment when it was debated on February 11. They promised merely ‘further discussion’.

Lord Hunt asked:

“The nub of the issue is ‘will this compromise their main regulatory function?’ I think it’s very ambiguous. 

“The health regulators are very unkeen on all of this. It’s pretty clear to me in discussions that they worry about the impact this will have.”

If the regulators long-standing duty to protect standards conflicts with their new duty to promote economic growth, how will it be decided which takes precedence?

Summary guidance on the deregulation bill states that the growth duty does not automatically take precedence over or supplant existing duties held by regulators, but what will that mean in practice? 

One regulator that could be affected is Care Quality Commission. A CQC spokesperson said: 

“The Government’s response [...] said the duty does not set out how economic growth ranks against existing duties as this is a judgement only a regulator can and should make.

“The quality and safety of services is the primary basis on which we will regulate, and take enforcement action where necessary to protect people who use services. We would not consider a new duty to promote economic growth to override this position.”

But the government expects to see it make a difference. So what will that difference be?

A Department for Business, Innovation & Skills spokesperson said:

“Regulators will be required to be transparent about how they are complying with the growth duty” and include details in their current reporting requirements.

But will regulators also be less rigorous about requirements and imposing non-compliance regulatory penalties on companies, if a private provider could complain, citing this duty?

The Care Quality Commission is already terrified of being sued by private health and care companies, its Chairman David Prior recently told the Telegraph. It too often ‘backed off’ trying to close unsafe homes and ‘tended not to fight back’ when it was legally challenged, he said.

Will the ‘growth duty’ just be another stick for the private companies to beat the regulators into silence with?

The Equality and Human Rights Commission, which promotes worker rights and fairness, felt that: “applying this growth duty to the EHRC poses a significant risk to the EHRC’s independence, and therefore to its compliance with the Paris Principles [its duties under EU equality law].”

There are other aspects to the Bill too that could have damaging outcomes. Social care is to become less regulated by scrapping the need to register staff with Ofsted.

Baroness King of Bow said in the Lords debate on November 18th: “There is a feeling in the [social care] sector and indeed elsewhere that there has been quite simply inadequate debate around these very serious and important issues.”

Are these changes in the public interest?

A year ago in February 2014, MPs in the House of Commons, Caroline Lucas, Jonathan Edwards, John McDonnell and Jeremy Corbyn MPs proposed the removal of this clause putting a duty on regulators to promote economic growth, saying:

..." this Bill represents a race to the bottom and an obsession with GDP growth at any cost which is not in the public interest."

Of key concern is whether regulators will be inhibited from taking actions in the public interest because of the potential for legal challenge by private interests.

If this sounds familiar, you may have heard similar language on deregulation in discussion of the behemoth of deregulation playing in parallel internationally: the TTIP, the Transatlantic Trade and Investment Partnership (TTIP).

How are the consequences of these national and international deregulation changes inter-related? It is impossible to fully understand given the lack of public information available.

If the aim of the deregulation bill is to streamline services and remove red tape it should be very clear what purpose will be served through the changes and what consequences will be unleashed as a result.

But it seems that the government wants to get the bill through parliament first and leave the detail to be defined by secondary legislation afterwards - which does not have the same parliamentary scrutiny and discussion and is almost impossible to veto.

Lord Hunt said: “It’s a very unsatisfactory way of doing it, there’s no guarantees and the government can just produce and list and then change that at any time in the future.

Lord Hunt asked: “it’s a very open ended piece of legislation and the thing to ask is will it inhibit these key health regulators in protecting the public?”

Risky consequences?

Lord Reid of Cardowan in the Lords on February 5th said: 

“There are occasions during a ministerial career where, on study, what seems a relatively small decision becomes an obviously profound and very risky decision [...] having listened to this debate, I have the impression that this is one of them.” 

The potentially harmful consequences of these changes demand greater public scrutiny.

Will this bill future-proof the regulatory protections of health, environmental, safety, and social care, and prioritise the public interest?

If instead a duty to profit should be put first, one day the words of Lord Tunnicliffe may come back to haunt us: 

“Are these new clauses a licence for regulators to approve regulations that kill people to save money?”

We may then look back to find why failings happened, look to this bill, and shout, ‘bingo!’ 


The third reading is on 4 March and Lord Hunt has submitted an amendment to take out the Human Fertilisation and Embryology Authority (HFEA) and Professional Standards Authority (PSA) for Health and Social Care from being covered by the growth clause.

The importance of the regulation role of HFEA will be of particular importance in the upcoming mitochondrial donation debate.

As the Bill is amended and re-written, clause numbers will change. Clause 88(2) was the number of the duty to promote growth clause on February 11 2015 in the House of Lords debate.


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