Trusts around the country are setting up wholly owned companies to deliver services so they can take advantage of taxation changes this allows.

This great VAT saga shows the NHS at its very worst.    Bullied from above, local managers believe the hype from consultants.  They can’t write a proper business case but still launch a project in secret, refuse to consult with staff, totally mislead the staff and public about the real intentions, refuse to give information claiming everything is commercially confidential and plough on regardless – all with the active collusion of a Regulator that is supposed to stop such poor behaviours.  Those involved continue to refuse even to respond to FoI requests.  Questions in both Commons and Lords get stock answers saying this has nothing to do with Ministers – it’s local decision making – nothing to see here.

Unison has been active in opposing the outbreak of wholly owned companies for 18 months.  On the face of it this represents money for nothing – the same staff doing the same job in the same way with the same managers but with “savings” in £millions from tax changes.  No increase in productivity, no innovation, no efficiencies at all – just a tax scam.  The staff loose out by moving out of the NHS and become collateral damage, but this does not matter as they are not nurses or doctors – that may come later.

Tactically the Trusts also get to break out of the national pay and conditions and can pay new staff and even promoted old staff on worse terms and conditions.  This alone should set red lights glowing somewhere.

Oh,  and two fingers up to any local plan about working together, collaboration and that guff – this is every Trust for itself – they even all claim that they will be selling services to each other.

And big issues like the consequences of transferring ownership and control over public assets to a private company (even one which for now is wholly owned) have simply been ignored or lied about.

Facts as opposed to the lies, are slowly emerging.  To take one well documented example. Late in 2016 a Trust did preliminary work with outside consultants on going down the wholly owned companies route.  In December 2016 in secret the Board agreed to go ahead using a particular model solution pitched to them by the consultants.  They did not look at the overall strategy involved and failed to look at other options.  This offer was too good to be true and others had done it; so why not?  The “Business Case” to the Board was laughable being a few pages of platitudes and 63 pages of tax advice.

The Trust worked on in secret, despite being under a very clear duty to engage with the staff on a decision which affected hundreds of them.  Eventually, late in 2017, they had to come clean and start TUPE consultations, but they consistently refused in every forum to consult or engage with staff on what was being proposed – they would only talk about the consequences.  They knew their whole case was entirely bogus.

In public the Trust simply avoided telling the truth.  They maintained throughout that what they were doing had to do with somehow professionalising the facilities management services.  Strangely the Trust had never reported its concerns with these services before they were sold the VAT dodge.  They never engaged with staff to see how they could improve services at all.

The Trusts maintained the fiction that this was nothing to do with tax as they had been instructed to do.  They gave a presentation to staff which had a dozen slides but none of them even mentioned VAT or tax. They signed a secrecy agreement with the consultants they used.  But because information was coming out of other Trusts doing the same thing, but slightly more honestly, they were caught out anyway.

After enormous pressure from Unison the Trust finally revealed at least some of its documents but only after it was already implementing its decision.  What the documents showed was what everyone already knew – the savings almost all came from changes in taxation.  Savings from other sources such as reducing pension rights or bringing in a two tier workforce were tiny in comparison.  This was and is all about tax. All about a Trust in severe financial straights doing anything to make savings.  Doing what it was told.  It was more afraid of external intervention for not trying hard enough than it was afraid of the outrage from its own staff.

Utterly dishonest from start to finish.  But with active collusion from NHS Improvement – the Regulator which knew exactly what they were doing and why, even if they now refuse to release the information and ignore FoI requests.  We know from parliamentary answers that NHSI signed off the deal.  We also know the relevant CCG opposed it and appealed to the Trust not to go ahead – yet again the lie is that everyone was in agreement.

A disgrace from start to finish.  Staff disillusioned, staff relations soured for years to come, further fragmentation of the NHS and a wholly uncertain cloud over the future ownership and control of vital NHS assets.  And NO SAVINGS.  Anything saved in one place is lost to the exchequer in another – its our money and we get no benefit at all.

No Board that agrees to this kind of subterfuge and secrecy is fit to stay in place.  But they will.

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  1. Very well said Richard. Anyone who tells lies, covers up, wastes public money should be dismissed. Anyone who fails to protect patients, or harms whistle blowers or any hard working staff must be dismissed and held personally account and there must be criminal sanctions for them. Today, NHS has culture of bullying, harassment, telling lies, poor leaders who move from one job to another and protect their friends. They are paid huge salary by the public and there is absolutely no accountability.

    Leader with authority but no accountability is the most dangerous form of leadership. In such a culture it is innocent who suffer and lot of money is wasted.

    It is the job of good leaders who care to make sure they hold bad leaders to account. To make the world better place, we must always appoint kind, caring, compassionate leaders who care for staff and always do what is right for patients and for the NHS.

    NHS needs more money but it also needs transformational leaders with courage and those who know what and how to transform and whatever we do, it is our patients, staff and NHS must see the benefit.

    Without integration of health and social care, we will not be able to transform either of them.

  2. anon says:

    Which Trust is this? And how can a publicly funded and provided, free at the point of need service be ‘integrated’ with self funded, means tested for-profit ‘market’ centred and possibly hedge fund owned social care, without the public funds subsidising the latter at the expense of the former. Even in a ‘managed market’, which is what this is intended to be, the winners are the ones with more money ie private providers. Especially since the budget is fixed and rigid control totals in place! If we rent back our health services (care closer to home, urgent care 111, mental health, opthalmology, wheelchairs,) from the private sector who want to cherry pick for profitability, the ill and disadvantaged will be left out. This is already becoming obvious with fixed budget contracts the CCGs are dealing with at the moment.

  3. Anonymous says:

    The last thing the NHS needs is transformational leaders.
    “Transformation” is just a marketing device for consultants (Mgt) so that they can sell dubious “solutions” to the gullible. The NHS equivalent of the sizzle on the sausage.

    Similarly “integration” is both impossible; as social care (funded only for the poorest), the NHS (funded as a comprehensive service) , nursing homes (funded privately and from social care) and the third sector /privately are all different organisations, established under different regimes and responding to different imperatives; and undesirable, as the only way that they can be “integrated” is by moving to a common platform (which will not be the NHS , and therefore will undermine the NHS) or by bringing in an “integrator” , paid to co-ordinate and manage all the interfaces involved( most likely to be an Accountable Care organisation).
    Most problems would be solved if the NHS and Social care were funded properly and professionals were trusted to do the best for their patients.
    Trying to “manage” integration through contracts and exhortation from doctors who think they were borne with a baton under their arms is a recipe for waste and frustration.
    The NAO couldn’t find any evidence justifying integration and neither can anyone else.

  4. Just what are the FIDUCIARY duties of the directors of NHS Trusts. Does anyone know, anyone, anyone?

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