Foundation trusts fail to fulfil their original promise

It has just turned 10 years since the arrival of NHS foundation trusts on the landscape of healthcare. Highly controversial within the Labour party at the time, they were presented by Tony Blair’s government, in part, as a way to make healthcare providers democratically accountable to the people they serve by way of diligent oversight, underpinned by representative democratic governance. They were, it was claimed, at least partly modelled on cooperative and mutual societies, with service users forming a grassroots membership to hold directors to account through democratic structures.

Thanks to the Foundation Trust Network there has been real success since 2003 in building capacity for elected governors. But while key, governors are only part of the picture, and a strong participative membership is vital to the overall effectiveness of the model. Cooperatives and mutuals empower their members. Unfortunately, however, with exceptions, particularly among the mental health trusts, meaningful participation for members is where foundation trusts have fallen short.

Decisions that could be taken by the membership, such as approving changes to the constitution, are the preserve of governors. And, unlike in cooperatives and mutuals, where the members are the owners, custodians and ultimate guarantors of corporate purpose, stewardship in trusts is also predominantly the responsibility of the governors. Beyond elections there appears to be little scope for grassroots membership to influence governors and hold them to account.

These problems have been exacerbated by the Health and Social Care Act, which required certain decisions to be authorised by governors rather than members. For instance, the act requires changes to the constitution to be approved by the governors (and directors). Previously trusts could choose for constitutional changes to be approved by their members.

Of the three core features of cooperative membership – information, voice and representation – members of a foundation trust have representation, but patchy information and no voice. This either leads to an ownership deficit, or the feeling that the governors are somehow the members.

The Francis report on Mid Staffordshire foundation trust demonstrated these weaknesses. It found there was no culture of listening to patients, a failure by the board to get a grip on its accountability and governance structure, a lack of effective engagement with patients and the public, and a lack of transparency.

True mutuality for foundation trusts, achieved through the strengthening of participative membership, can deliver significant benefits. Benenden Healthcare, for example, has a membership of 900,000, organised in branches, and with a highly democratic structure. It has been voted the UK’s most trusted healthcare provider for three years running. But Benenden exemplifies not just satisfaction but also responsibility. The claim rate on services is significantly lower than for private health insurers because, rather than seeing it as an individual consumer transaction, Benenden members are aware that they are drawing on support that is pooled and to be shared equitably for all members according to need.

In a recent presentation to the Cooperative party, I outlined a series of measures to strengthen the position of members and allow foundation trusts to fulfil the original democratic spirit of the model. Members must have a voice in trusts’ ownership and governance arrangements and communication between members and governors should be strengthened. There should be a review into whether members should be included in decisions currently under the control of governors, especially those given to them by the Health and Social Care Act, and possibly other issues such as executive pay and patient safety too.

Employees should be more systematically engaged as members, and foundation trusts should be required to publish clear forward plans so that members know what is coming up. Through relevant regulatory and inspection frameworks, foundation hospitals should be encouraged to engage with their local communities on decisions that their governors are likely to have to make in the future. Other measures should be considered, too, including the requirement for two-way dialogue, responsibility around health promotion, and closer connections around membership with the operations of HealthWatch.

Improving the role of members through representation and engagement will help to increase accountability, ensure that healthcare provision works for the area, and recognise the importance of community to cost-effective and inclusive health development in years to come.

——————————————-