Corporate accountability in the wake of Mid Staffordshire and Winterbourne View

Topics covered: Ridouts professional advice

The Department of Health is currently consulting on strengthening corporate accountability in the health and social care sector. The consultation runs until 6 September 2013.  There are three main elements:

  • A new fit and proper test for directors
  • Direct prosecutions of providers for breaches of fundamental standards
  • A new statutory duty of candour.

We deal with each of these in turn:

A new fit and proper test for directors

The proposal is to amend the CQC registration requirements “to place a clear duty on service providers to make sure that all Directors who are appointed to the Boards of any health or care organisation regulated by CQC are suitable for the job (i.e. are fit an proper persons)”.  The intention is that it will apply to senior governance positions, including executive directors, non-executive directors and trustees. Regulations and guidance will define what is meant by a fit and proper person.

The consultation document states that if CQC believes that a director is unfit, CQC would be able to insist on their removal by placing a condition on the provider’s registration. If a provider failed to remove a director that would be an offence and the provider would be liable to prosecution.  There is a right of appeal on the part of a provider to the First-Tier Tribunal if a condition is imposed on a registration. The Department is considering how best to provide a right of appeal for directors against CQC’s decision where they are removed by the provider because they are deemed to be unfit by CQC.

The Department is not planning to bring a formal barring scheme for senior managers within adult social care.  However, if a director had to be removed because of a threat of a CQC condition (or following its actual imposition) it would act effectively as a bar. The Department says, however, that it will be introducing a formal barring system for senior NHS Managers and leaders across NHS Trusts and Foundation Trusts.

Direct prosecutions of providers for breaches of fundamental standards

In terms of criminal sanctions, CQC can already prosecute providers and directors. However, in practice there have been very few prosecutions. This is because CQC is required to serve a warning notice first, which if complied with prevents a prosecution being brought in relation to the earlier breach of the registration requirements. The intention is to enable CQC to prosecute directly for breaches of fundamental standards. The Department of Health consultation states that, “this change would make it easier for CQC to prosecute both corporate bodies and individual Directors for providing poor and harmful levels of care, in effect giving CQC the power to prosecute for criminal neglect.” 

Statutory duty of candour

A key concern of Robert Francis QC during the Mid Staffordshire Public Inquiry was the lack of openness and transparency of the part of the hospital trust. One of his recommendations is the introduction of a statutory duty of candour on providers which has been agreed by the Government. The proposal is that it will be introduced as a CQC registration requirement, requiring providers to tell service users and their families when things go wrong and explain why. If a provider fails to be open then CQC will be able to prosecute without issuing a warning notice.


The Department of Health consultation is also an important statement of intent around enhanced corporate accountability. As with most things in life, the devil will be in the detail. Careful scrutiny of the changes to the law will be required to determine if they are fair as far as providers and their senior managers are concerned. A central concern will be whether the changes are sufficiently clear to enable responsible providers to run their businesses in a compliant fashion without unnecessary regulatory interference.

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