Filed Under (Charities, Primary Care Trusts, Secretary of State) by Paul on 04-01-2010
It’s not often that minor changes in accountancy rules become big political issues, but over Christmas it became clear that we are to have one of those moments.
The issue will concern those NHS trusts that also have charitable organisations linked to their NHS services in any way. The new accountancy ruling that would come in from April would impose new rules on NHS charities requiring all donations — including those to specialist children and cancer units, local fundraising campaigns, teaching hospitals and local community trusts — to be listed on a hospital’s balance sheet.
Whatever the motive, it’s pretty obvious that the implications of this for the economics and politics of the NHS are immense. It would mean that with a tick of the accountant’s pen, money that people had donated – precisely NOT to supplement NHS income – would be treated in the same way as NHS income and placed in the same pot.
Almost certainly this is not why people give money to NHS charities. They do so for charitable purposes which are different from the taxation that they pay to the Treasury.
There is an interesting piece of history here. Back in 1948 when the Government was nationalising the nation’s hospitals they recognised that the charities which some hospitals ran alongside the main business of the hospital were of a different order. Whilst the new NHS would have loved to take this money for itself it didn’t, and left the charities as separate from the taxation based system. It would be really odd if, 60 years on from its start, the NHS were to try and nationalise the charities that it hadn’t in 1948.
The NHS now has a budget of over £100 billion from taxation. Alongside this it is estimated that every year about £330 million is given to some 300 NHS charities. These charities also control about £2 billion of assets. For some hospitals these are very large sums of money.
The motivation for this could simply be someone within an accounting body saying that these new rules have to apply. In which case a wise Secretary of State would say that this is daft. Charities are different from taxation. Don’t mix the two up.
However there will be some that see a pattern in this. We know that the current Secretary of State has a personal preference for NHS providers. It could be said that through his personal preference he wants to renationalise the NHS and do away with any independent provision… Once you start down this path it can lead to wanting to nationalise anything that moves – and this might include NHS charities.
Over the next few weeks we will be able to determine – by the way in which the Secretary of State reacts – which of these possible motives is the real one.