The Office of Fair Trading will consider most foundation trust mergers under the terms of the Health Bill, it has emerged.
Health minister Paul Burstow told the Health Bill Committee on Tuesday that the OFT would consider mergers where the acquired trust has turnover of over £70m - which would apply to all but a few NHS providers.
The minister’s comments clarify how the legislation will make it easier for foundation trusts to merge. Labour said the threshold was a “new policy”.
The committee allowed clause 71 – which applies the Enterprise Act 2002 applies to mergers – to remain in the bill. But Liberal Democrat John Pugh voted against the clause, forcing the committee chair to give a deciding vote.
Mr Burstow said: “The clause means that we would have a single regime for merger control, which would avoid duplication of resources between Monitor and the OFT, and it would also address the current situation whereby the Co-operation and Competition Panel formally assesses all mergers involving acute or foundation trusts where the turnover of the combined entity is more than £70 million.
“The OFT would only consider mergers… where the body being acquired had a turnover of more than £70 million or where the resulting share of supply exceeded 25%of the market.”
He claimed in the system a “lower number of mergers… would be caught”.
He added: “The OFT has an established reputation for effective, light-touch regulation where mergers are concerned. This gives confidence to providers that might be considering a merger and ensures that mergers that are in the patients’ best interests go ahead.”
He said the OFT “would obtain Monitor’s view on how a merger would affect competition and whether it would bring benefits for patients”.
Labour health spokeswoman Liz Kendall said: “Whatever the minister likes to say, he has announced new policy today, which people have not heard before.”
She said Mr Burstow was “giving to a body that has no expertise, knowledge or influence on the NHS the responsibility to make decisions on mergers of hospitals. That is the truth. He should not be exploring the impact of the clause as he goes along. He should be withdrawing it from the Bill”.