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NHS Charities

Volume 504: debated on Wednesday 27 January 2010

4. What discussions she has had with the Charity Commission and the Secretary of State for Health on proposed changes to the accounting treatment of NHS charities. (313354)

I have discussed the accounting arrangements for NHS charities with the Charity Commission and with the Minister of State, Department of Health, my hon. Friend the Member for Corby (Phil Hope). The funds of an NHS charity are, and will continue to be, controlled by the charity’s trustees for charitable purposes. The international financial reporting standard will have no effect on the independence of those funds. My hon. Friend the Member for Corby, however, has engaged with colleagues in the Treasury to seek to delay the implementation of that requirement for a further year.

That was a slightly confusing response. Will the Minister make it quite clear whether the Government are pursuing the option of consolidating NHS charities on NHS balance sheets? Can we just have a simple yes or no?

The hon. Gentleman may operate in a world in which yes or no does it for him, but most things in life are a bit more complex. However, I can give him a categorical assurance that the finances of NHS charities will remain entirely controlled by the trustees of those charities, which is appropriate. All that we are talking about, and the source of the confusion and misunderstanding, is a technical change to accounting and reporting arrangements. I can give the hon. Gentleman an absolute assurance that funds will remain controlled by the trustees, and will continue to be controlled by the trustees.

My right hon. Friend will know that many communities give a great deal of support to NHS services, both in the hospice movement and in general health services. People would be dismayed if they thought that the moneys given voluntarily would be used against the NHS hospital budgets.

I agree with my hon. Friend, and they will not be. This is purely a technical accounting matter, so I am sorry about those concerns, because they are unfounded. There is no intention whatsoever that anything should be done with charity funds, which should remain with those charities. It is a purely technical accounting matter, and I hope that those assurances will satisfy my hon. Friend.

The Minister described this as a purely technical matter, but is there not a danger that NHS charities could be subject in effect to more central micro-management? Should we not seek in fact to decentralise control?

I can assure the hon. Gentleman that there is no such intention. This arrangement will not centralise any funding or any control of those charitable funds at all.

I welcome my right hon. Friend’s statement that she is going to defer implementation for 12 months, but may I persuade her to go back and have further meetings, and support the Sunday People campaign not to introduce the new arrangement at all, and ensure that people feel happy to give freely and openly to charities in the NHS without any issues?

First of all, I do not have the power to introduce it or not. It is a matter for the Treasury, because it is a technical—

If I can finish answering the question that my hon. Friend asked. [Hon. Members: “Oh!] I would always wish to respond to my hon. Friend in full, and I will continue to do so. I am sorry that there is misunderstanding about this, because we do not want people not to give to charities in the NHS because they think that the money will not be used appropriately. It is purely a technical matter but, as I said, the Health Minister, my hon. Friend the Member for Corby, has asked the Treasury to defer implementation for a year to provide the reassurance that is required.

The Charity Commission does not agree with the Government. It warned 18 months ago that the proposals risk undermining public confidence in the independence of NHS charities, but still the Government dither. Those accounting standards were never meant to be applied to charities. Other countries have chosen not to apply them in this way. They are being imposed because of bureaucratic diktat. The issue needs gripping by Ministers, so will the right hon. Lady pledge to work with colleagues in the Department of Health and Monitor to persuade the Treasury not just to defer a decision for another year, but to drop this whole nonsense altogether?

I am not sure that there is any disagreement in the House on the principle of what the Government seek to do. NHS charities should have their funds independently administered by the trustees, which is the law. As I said, the Health Minister, who has been dealing with the matter with the Treasury, fully understands the views of the House and will ensure that they are represented at all times.