1.  The Chartered Society of Physiotherapy (the CSP) is the professional, educational, and trade union body for the United Kingdom's 40,000 chartered physiotherapists, physiotherapy students and assistants. The majority of our members work in the NHS, but a significant proportion is employed in independent hospitals and higher education. Our members also work for charities, in residential homes, sports clubs and in private practice. Around 98% of qualified practising physiotherapists are members of the CSP. Physiotherapy is the largest allied healthcare profession in the UK.

  2.  The CSP welcomes the Health Select Committee's Inquiry into foundation hospitals. The CSP believes that foundation hospitals could have the potential to improve the delivery of services, the recruitment and retention of physiotherapists and assistants, and stakeholder involvement.

  3.  Our response reflects the lack of prescription seen in the Government's current documents and highlights the range of questions we would wish to have answered before we could reach a firm decision on whether to support implementation of foundation trusts. A great deal rests on the quality of the applications and we have reserved judgment until it is possible to better ascertain the impact on physiotherapists and assistants working both inside and outside of foundation hospitals.

FINANCIAL IMPLICATIONS

  4.  We welcome the Government's proposals for a standard tariff system to operate throughout the NHS. We are hopeful that operating under a tariff system will lessen the likelihood of recreating the internal market and undercutting nearby hospitals in access to patients. We would be concerned, however, that foundation trusts might be tempted to reduce costs at the expense of service quality in order to maximise surpluses.

  5.  We would be concerned if the increased financial autonomy enjoyed by foundation hospitals had a knock-on effect on other hospitals' access to Department of Health funds. We would wish to see equality of access to prevent as far as possible further divisions between foundation hospitals and the status quo. Differing borrowing capabilities must not be allowed to lead to a two-tier NHS and we will be interested to learn how the Government intends to regulate this matter.

  6.  We would also like reassurance that foundation hospitals will be permitted to expand and develop through conventional procurement, rather than only through private finance initiatives. The CSP would be concerned that freedom to dispose of non-registered assets (like car-parking) could have a detrimental effect on staff.

STAFFING IMPLICATIONS

  7.  Although the guidance states that foundation hospitals will remain within the NHS family, it is not clear what this will mean in practical terms to staff within those trusts. It is important that all staff are able to retain their existing terms and conditions and maintain their continuity of NHS service. We would also be concerned if new staff had markedly different terms and conditions to existing staff as this would lead to disenchantment. Our primary concern is that because staff's contracts will be with their foundation trust, the trust as an employer will have the legal right to vary staff's contracts and therefore introduce local conditions of employment.

  8.  We are pleased to see that applicants must submit a human resources policy statement making clear the terms and conditions of employment for all staff as part of their second stage application process. It is crucial that this commitment is extended to new staff and is maintained throughout the licence period.

  9.  The CSP, alongside many other trade unions, has been involved in negotiating Agenda for Change which sets out national pay, grading and conditions for more than one million NHS staff. If this is brought to a successful conclusion, we would wish to ensure that this is applied across the whole of the United Kingdom. NHS bodies are currently instructed through directive from the Secretary of State to implement nationally bargained pay structures; we are not sure how foundation hospitals would be obliged to follow this directive. Agenda for Change includes some freedoms for trusts with earned autonomy. The CSP would wish to see assurances that foundation trusts do not go beyond Agenda for Change and apply national agreements.

  10.  The Government has set a target for an increase in the number of physiotherapists of 59% by 2007. In order to train this expanding workforce, it is necessary to have increased access to clinical placements. It is imperative that foundation hospitals continue to play a role in developing future staff through clinical placements and that this is regulated by the Workforce Development Confederations and Strategic Health Authorities to ensure that they fulfil their local and regional responsibilities. We are pleased to see the commitment laid down in the Department's Guide to NHS Foundation Trusts to training and education in the form of legally binding service agreements.

  11.  It is also vital that research to secure evidence based medicine is maintained and we would wish to see a role for the WDCs to encourage research within foundation hospitals.

  12.  Finally, current guidance issued by the Department of Health has omitted an explicit role for healthcare trade unions in the assessment of staff support for applying for foundation status (NHS Foundation Trusts—eligibility criteria and timetable.) It is vital that consideration is given to staff concerns about the impact on their position within the NHS and trade unions are best placed to allay these concerns. The Department of Health has issued a number of guidelines recently about staff involvement and it would be an opportunity missed if they were not included right from the start, especially as they will form part of the stakeholder governance group of the trust.

GOVERNANCE AND ACCOUNTABILITY

  13.  We welcome the Government's intention to make foundation hospitals governed by their stakeholders, including staff and patients. The CSP would like reassurance that staff representation will not be limited to doctors and nurses and that all staff, not just healthcare professionals, will have the opportunity to seek selection onto the Board of Governors. We would also wish to see more explicit guidance on what is the hospital's constituency, particularly for large and specialist hospitals where there are not clear geographical boundaries. It will be an important element of fostering ownership for the local community and action will need to be taken to encourage participation across a broad base of the population. We are concerned that members will have some legal liabilities as well as rights, including under insolvency conditions. We believe that this could deter a representative cross-section of the community from joining the trust.

  14.  We are pleased to see that a panel of experts with an understanding of membership democracy will be assessing the applications. The CSP, as a membership body where 98% of those eligible are members, has a wide range of experience in facilitating local, regional and national participation within a framework of accountability to the full membership. We would welcome the opportunity to assist the Department of Health in developing best practice in involvement and democracy with a broad base of the community.

  15.  We would like to have clarity on the roles of local networks in service provision investment and the stakeholders within that network. It is vital that information is made available at the earliest possible point and that commercial confidentiality cannot be used to deflect pertinent inquiries. Operations must be open and transparent to ensure that the community are well placed to exercise authority over development.

  16.  There are a large number of questions relating to governance and accountability, which have yet to be outlined in even basic terms. It is important that these are answered as soon as possible to ensure that the structures are sound. The CSP has expressed concern to ministers and officials that as free standing organisations, foundation hospitals may become subject to European competition law. This could mean that other organisations, including those, which are not driven by a public sector ethos, could compete for the delivery of services. We would like the Government to ensure any necessary steps are taken, on the basis of expert legal advice, to prevent this from occurring.

  17.  We would also like more information on how foundation hospitals would be governed should their standards fall. If a failing NHS foundation hospital were to be taken over or merged with another NHS trust or foundation trust, how would the local membership link be maintained? What would be the incentives for other trusts to manage the operations of a failing foundation trust?

  18.  Much of the detail of the governance of future NHS foundation hospitals has been left to the discretion of the applicants, with guidance offered by the Department of Health. We are concerned that this could result in much activity being undertaken outside of a fair, equitable and transparent framework and we would like reassurances that this will not compromise the process.

IMPACT ON THE QUALITY OF MANAGEMENT AND ON THE QUALITY OF PATIENT CARE

  19.  The Government has announced that only three star hospitals will be permitted to apply for foundation status in the first wave. We appreciate the intention of incentivising trusts to gain three star status, but the CSP considers that this could result in a two-tier system of standards. This would be wholly unacceptable. We would recommend to the Secretary of State that he consider evaluating the impact of foundation hospitals so that an evidence-based decision could be taken about whether to roll them out throughout England. This might require that a range of different types of trust should be included in the first wave, three star and one star, inner city and rural, specialist and district general. This must be evaluated and different models considered before progressing to further implementation.

  20.  Performance indicators currently in use do not fully reflect patient satisfaction with the range of interventions on offer. This is particularly true with physiotherapy treatments where measurements such as length of stay or number of treatments do not lead too much meaningful analysis. We would like to see more qualitative measurements being used and that these are evidence-based.

  21.  The CSP would also like reassurance that there would not be any financial or other incentives to resist or terminate contracts with patients who are not "profitable". Services must be fully comprehensive and responsive to each trust's community. It is right that money follows the patient, but this must be equitably distributed and not skewed towards particular types of patient. Patients requiring long term care must not suffer under the change of status and it must not be permitted to fracture patients' journeys throughout the stages of their condition.

  22.  We would also wish to see a reduction in the complexity of the regulatory system and in the abundance of red tape. The need for evaluation and monitoring must be balanced with the time taken away from patient care.

IMPACT ON THE WIDER NHS

  23.  Foundation hospitals are being introduced at a time of massive change within the NHS. It is important that this does not challenge the authority of other structures, such as PCTs, before they have been given the opportunity to bed down as this will destabilise the whole system.

  24.  There must be an impact assessment undertaken on the micro health economy to evaluate how other local hospitals and NHS bodies are affected. There needs to be a statutory role played by the Strategic Health Authorities and the WDCs to ensure that foundation hospitals work towards regional collaboration to minimise the negative impact on the wider NHS and their patients. Partnership working must be a core attribute of all foundation hospitals throughout their licence period.

CONCLUSION

  25.  The CSP considers that the introduction of foundation hospitals could change the face of the health economy and it is important that there is wide consultation throughout the legislative process and with all stakeholders of each applicant. Our concerns are focused on the details of how foundation trusts will operate in practice and its impact on the delivery of physiotherapy services to patients. We agree with the Government's view that there should be greater decentralisation of decision making.

  26.  We will be advising our members in each applicant trust to act constructively during the process to ensure that the best outcome is achieved locally for patients and our members. However, we will continue to discuss the detail of the policy with the Government and voice our concerns to effect change at national level.