Foundation trust regulator Monitor has scrapped its plan to build “Chinese walls” within its organisation to separate its existing role from its future responsibility to regulate the entire NHS healthcare sector.  

Monitor chairman and interim chief executive David Bennett had previously proposed to have separate senior executives for the two roles, and Chinese walls to “to ensure information or intelligence does not flow inappropriately between the two areas”.

He had warned that unless the regulator could show clear separation between its existing duties and those given to it by the 2012 Health Act it was likely to face “numerous” allegations of improper conduct.

But Mr Bennett this week told HSJ that, following last-minute changes to the legislation before it became law, Monitor no longer planned to adopt this structure.

The regulator, he said, was “now operating under a single primary duty which is about protecting and promoting the interests of patients”. In any circumstance where Monitor might be accused of a conflict of interest “we always have to take ourselves back to that single fundamental question: what answer will be in the best interests of patients?”

He added: “We have to be careful to always be able to bring it back to that fundamental question, but precisely because that’s what we must do, we don’t now need – indeed we positively shouldn’t be having – Chinese walls. We need to always be able to bring it back to what’s going to be in the best interests of patients.”

The position is in marked contrast to Mr Bennett’s position on 30 November last year, when he submitted a Monitor board paper proposing Chinese walls and a separation of senior executives.

“In the coming years, Monitor will have a number of difficult decisions to make,” the paper stated. “Reasonable stakeholders may disagree, for example, over what constitutes an efficient price, what constitutes an appropriate degree of competitive intensity, or whether Monitor should have done more to protect the survival of an NHS FT.

“Unless Monitor can clearly demonstrate it has acted properly, allegations and challenges around improper conduct owing to undue influence being exercised by one regulatory function on the other are likely to be numerous.”

The new approach comes after last-minute changes to Monitor’s future role as the reform legislation went through Parliament. The Health Bill had originally defined Monitor’s foundation trust regulator role as a separate and temporary set of duties, which it would lose after all remaining trusts had attained foundation status.

This was changed at a late stage, to make Monitor’s powers over FTs a subset of its powers to licence all NHS healthcare providers. A Monitor consultation on NHS provider licencing published this week lists an additional set of licence conditions, over and above those that will apply to all providers, that the regulator can place on FTs.

A spokeswoman for the Foundation Trust Network said: “We had always said there needed to be a clear separation of the two roles that Monitor carried out, so there was assurance of no conflicts of interest”.

Monitor would now have to be “incredibly careful about how they navigate that territory, because what they do in one area will clearly impact on their decisions in another area, she said.

She added: “If they’re creating a single board rather than having two separate managing directors or chief executives, we would hope that’s a signal that ultimately the FT regulator [role] will disappear, as was originally envisaged by the legislation – so this would only be a short-term conflict of interest.”

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