Individual directors on the boards of healthcare providers will face the threat of criminal prosecution for neglect or abuse of patients, health minister Norman Lamb has said.

The news came in an exclusive interview with HSJ, in which the minister also revealed a desire to re-examine the role competition authorities have taken in the NHS following the 2012 Health Act.

Asked about the government’s plans to introduce criminal sanctions for failure to meet new fundamental standards of care, Mr Lamb said ministers were still working on their final response to the Francis report.

However, he added: “The powers to prosecute for what is essentially an offence of corporate neglect will apply to both the corporate body, or the NHS trust, or director.

“The problem we have had is that the regulatory system for holding organisations to account has been flawed from the start.

“In the past as long the organisation complied with a warning notice from the CQC they couldn’t be prosecuted. For me that has to change.

“The change we are making will apply to individual directors.”

On the role of the Office of Fair Trading and the Competition Commission in foundation trust mergers, he said: “This is an area that we have to look at to ensure we don’t have judgements made or investigations undertaken where there is a clear public interest in a merger taking place.”

He was concerned the increased involvement of the competition authorities could end up blocking the development of integrated care organisations.

“We need to look at it to make sure the rules work in a rational way,” he said.

Former minister and Mr Lamb’s Lib Dem colleague Paul Burstow told HSJ earlier this week that he believed the OFT and the Competition Commission were being “disproportionate” in their activity.

Mr Lamb said no final decision had been made on payment by results in mental health, but he had asked officials for information “on where we are at” with the project. “It is crucially important that we make the right judgement on this,” he continued.

“When you have the combination of the very powerful 18-week access target and the combination of PbR in the acute sector and not in mental health it has a massive distorting effect on where the money ends up in the health service.

“It encourages activity in the acute sector and, in my view, too much of the investment over the last decade has gone into the acute end of the system.”

Mr Lamb said the government was planning to publish new standards for mental health crisis care which would affect a trust’s CQC rating.

He said: “We want all the relevant organisations to sign-up to the standard of crisis care and to help them to account when the CQC starts to investigate mental health providers and rate them. If they aren’t delivering that standard of crisis care they would receive a poor rating.”