Legislative changes to increase the CQC’s enforcement powers, which are due to come into force this October, will have a huge impact not just on NHS providers, but also on the directors running them. In the first of a series of articles we give an overview of the changes

Silhouette of managers

In this article we examine four key areas of legislative and procedural change:  

  • The new criminal offences in respect of breaching fundamental standards;
  • The duty of candour and the criminal offences for breaching this;
  • The offence of criminal neglect in respect of those with mental capacity; and
  • The new “fit and proper person test” for directors and the barring lists for those that fall short of the test.

Fundamental standards

Last September, the Department of Health welcomed the advent of the new draft fundamental standards (contained within the new draft 2014 regulations) because the removal, in some instances, of the requirement for the Care Quality Commission to issue a warning notice prior to prosecuting providers was seen as being “likely to create a stronger deterrent effect against non-compliance with the regulations”.

‘The impact on NHS providers is likely to be significant’

The new regulation 17 makes it clear that while breaches of some regulations will still only be subject to prosecution following service of a warning notice, in respect of many of the new regulations no warning notice will need to be served prior to a prosecution.

Examples of breaches for which no warning notice will need to be served prior to a prosecution range from a breach of the requirement to make reasonable adjustments to meet a service user’s needs (reg 4(3)(e)) to a breach of the need to meet the nutritional needs of service users (reg 9(1)) or the need for premises and equipment to be “safe, clean and secure”, “suitable for the purpose for which they are being used” and “properly used and maintained’’ in “accordance with generally accepted professional standards” (reg 10).

The problem with the new regulations is that many sections are incredibly confusing and vague, and in some places give scope for extremely broad interpretation. Examples of vague and undefined phrases include “generally accepted professional standards” (regs 4(2)(b)) and 10(1)); “suitably accessible equipment” (reg 4(3)(f)); “appropriate steps” (regs 7(2)(a) and (b), reg 8(2)), “appropriately investigated” (reg 11(1)) and “appropriate action” (reg 11(1)).

There is also a lack of clarity over the circumstances where a lesser form of enforcement action would be taken in cases which do not merit a prosecution.

The impact on NHS providers is likely to be significant. First, some of the provisions are more onerous. For example, regulation 12 on “good governance” (which replaces the current regulation on assessing and monitoring the service) now imposes a requirement that the provider should be “continually evaluating and improving [such] services”.

Secondly, the proposal is that the financial penalty for failing to meet the new regulations will go from a £50,000 fine to an unlimited fine (page 18 of the DH Consultation document on Introducing Fundamental Standards, published in January 2014).

Third, directors should also be mindful of the fact that pursuant to section 91 of the Health and Social Care Act 2008, prosecutions can be brought against a director, manager or secretary of a “body corporate” where the offence is due to their “consent” or “connivance” or “attributable to any neglect on their part”. Section 91(3)(b) makes it clear that where the body is an English NHS body this would apply to “any officer or member of the NHS body”. 

The duty of candour

Among the questions raised by the report published by Robert Francis QC last year following the alleged failings in the Mid Staffordshire Foundation Trust, was the extent of a healthcare provider’s duty to be open and transparent to patients. Following on from the Francis report, the DH  published a consultation in March on the proposals to put the duty of candour on a statutory footing. The public has until 25 April to submit responses to this consultation.

Once the draft regulations are enshrined in legislation later this year, it will lead to a statutory obligation on a “registered person” (in the case of the NHS the service provider) to inform patients (or their lawfully entitled personal representatives) where any death or “severe’” or “moderate” harm has been or may have been caused to a patient by an act or omission of the organisation or its staff. “Moderate harm” is defined as including a “moderate increase in treatment”, “significant but not permanent harm” or “prolonged psychological harm”. This could encompass a very wide range of situations.

‘The provisions appear to be considerably more onerous than the current requirements of a service provider to notify the CQC or NHS England of death or injury’

The patient or their representative should then be informed of the incident as soon as is reasonably practicable, be given full disclosure of the circumstances and be offered  appropriate support, whether or not the patient or their representative has asked for this information. The notification needs to be made in writing and should also include an apology and advice on details of further enquiries which are appropriate. 

According to the Francis report the provision of this information would not of itself be evidence of or an admission of any civil or criminal liability, though this has not been spelt out in the new regulations. We feel that it ought to be and this is a key omission. According to regulation 6 of the new duty of candour regulations, a provider found guilty of this offence would be liable to a fine. It will be a defence under regulation 6(3) for the registered person to prove that they took all appropriate steps and exercised “all due diligence” to ensure that the provision in question was complied with.

It is proposed that the CQC would be charged with policing the observance of this duty. The above provisions appear to be considerably more onerous than the current requirements of a service provider to notify the CQC or NHS England of the death or injury of a service user under the CQC registration regulations, in that they extend the duty of disclosure to service users and create a new criminal offence for failure to make the relevant disclosure, which includes disclosure in relation to moderate harm.

It is also likely that there will be more prosecutions or fixed penalty notices for the existing offence of failing to notify CQC about the death or injury of a service user under regulation 25 of the 2009 Registration Regulations, particularly since there is no requirement for a warning notice in respect of this offence.  

Once these regulations become legally binding, this may well bring about more litigation, as well as having significant administrative implications. Appropriate policies will need to be in place, and documented, for notifying service users or relatives if death or severe or moderate harm may have been caused by the act or omission of a health care provider. It is also likely to affect NHS indemnity cover.

Criminal neglect of patients with capacity

Section 44 of the Mental Capacity Act 2005 already provides for an offence of ill-treatment and wilful neglect of those lacking capacity. This covers cases of both intentional and reckless behaviour.

The DH has now proposed that there should be a similar offence in respect of those with capacity, albeit this would not apply within the domestic setting. Under the new proposals individuals and organisations could face up to five years’ imprisonment and/or up to £5,000 in fines.

According to the DH’s impact assessment on the new proposed legislation, it is estimated that there will be 240 prosecutions a year. This figure has been adjusted from the number of prosecutions currently brought under the mental health legislation to take into account the fact that those without mental capacity might be more likely to suffer abuse, though less likely to report a crime.

In reality we will have to wait to see what the real number of prosecutions will be. At the moment most prosecutions under the MCA 2005 have been against individual carers or healthcare professionals rather than against managers and organisations. It will be interesting to see whether this trend will continue with the new legislation or not.

The barring list

Finally, the DH has recently launched a consultation on the new fit and proper person regulations. The deadline for responding to the consultation is again 25 April.

In the new regulations, it is proposed that any director of a service provider should be:

  • of good character;
  • have appropriate qualifications, skills and experience;
  • be physically capable of performing their job by reason of their health;
  • ot have been responsible for or privy to, contributed to or facilitated any misconduct or mismanagement (whether unlawful or not) in the course of carrying carrying on a regulated activity; and
  • not be prohibited from holding the relevant office or position or carrying on the regulated acitvity by any enactment.

A director can also be deemed unfit if they have been sentenced to imprisonment for three months or more within the past five years, are an undischarged bankrupt, are the subject of a bankruptcy order, have an undischarged arrangement with creditors or are included on any barring list preventing them from working with children and vulnerable adults.

According to the consultation, it is proposed that there will be a scheme for CQC to be able to bar directors who are unfit so that they cannot move to positions in other organisations once they are found to be unfit. CQC will be responsible for managing the barring list. CQC will assess fitness on initial registration and could refuse to register a provider if they thought that the director was unfit and thereafter on an ongoing basis.

The government plans to introduce a right of appeal against these decisions, which will be to the first tier tribunal for the individuals affected. This is being put in place through the Care Bill.


All of the measures discussed in this article underline the fact that CQC’s ability to take action against both trusts and individuals is being extended. Notwithstanding the supportive rhetoric, the CQC seems to have an increased appetite to target what are perceived to be failing hospitals.

‘The CQC seems to have an increased appetite to target what are perceived to be failing hospitals’

David Prior recently said “there are probably 30 hospitals in England that we know have been bumping along the bottom for forever.” He also stated that once the CQC has finished inspecting the acute sector under its new regime, up to 30 hospital trusts could be placed in “special measures”.  

The aim is for these new changes to become enshrined in legislation by October 2014, with the exception of the criminal neglect offence, which we are still waiting for more information on. We will  be following this introductory article up with any further developments over the next few months.

The next article will be on the new proposals in relation to hospital and trust ratings and appeal.

Neil Grant is a partner at Ridouts LLP and Joanna Dirmikis is a barrister and advises on health and social care law for the firm