NHS Spending: Safeguards (Hansard, 2 February 1994)

§ Baroness Cumberlege
My Lords, in January 1993 the Department of Health issued instructions to the NHS that large-scale investments in information technology should not be approved unless they met published criteria. In addition, investments of £1 million or more need prior approval by the National Health Service Management Executive and Her Majesty's Treasury.

§ Lord Dean of Beswick
My Lords, I am grateful to the Minister for that answer and the information it contains. I am sure we all welcome any measures introduced by the Government that will prevent a repetition of recent huge financial losses in various parts of the NHS. Is the information I have right? Has the Secretary of State, Mrs. Bottomley, once again refused to consider introducing sanctions to recover sums of money from people who were appointed but who have taken deliberate decisions which have meant: the loss of huge sums of money? Will the Minister explain what is the difference between a local councillor who loses ratepayers' money as a result of a deliberate decision and who is surcharged, and a member of an appointed body who loses NHS money in a particular area but who is not surcharged? What is the difference?

§ Baroness Cumberlege
My Lords, I should like to reassure the House that sanctions were taken against non-executives and executives in terms of their employment. But my right honourable friend the Secretary of State has no legal powers to issue surcharges.

§ Lord Dean of Beswick
My Lords, I am sorry to intervene again so quickly but I believe that the Minister 1261 may have misunderstood my question. Is she aware that it refers specifically to financial surcharges and not removal from jobs?

§ Baroness Cumberlege
My Lords, my right honourable friend the Secretary of State has no powers to surcharge individuals.

§ Baroness Robson of Kiddington
My Lords, I thank the Minister for her reply to the supplementary question of the noble Lord, Lord Dean. Why is it that some of the people who were responsible for the problem in the Wessex Regional Health Authority have since been appointed to senior positions?

§ Baroness Cumberlege
My Lords, the chairman of the health authority to whom the noble Baroness refers has been appointed to chair the NHS Supplies Authority. That appointment was made before the issue came to light. We have always had confidence in him. Indeed, it was he who discovered some of the problems and who ensured that the regional general manager left his post and a new manager was appointed. He also ensured that financial instructions and other measures were taken within the regional health authority to make sure that the situation did not occur again.

§ Lord Richard
My Lords, the Minister said twice that her right honourable friend has no power to surcharge. That is the whole point. Does the Minister appreciate the growing feeling in this country that the Government or some body should have the power to impose a surcharge on people who lose or waste money in exactly the way that local authority councillors can be called to account? Will the Government give serious consideration to getting through Parliament the power to impose such a surcharge?

§ Baroness Cumberlege
My Lords, all possible legal action has been followed. Your Lordships will be aware of recent press publicity about executive members of the health authority appearing before the courts in connection with these incidents. Many measures have been taken. In response to the PAC report the Secretary of State has taken 15 different initiatives and the Wessex Regional Health Authority has taken 19 initiatives.

§ Lord Hailsham of Saint Marylebone
My Lords, is it not obvious that, in relation to surcharges, there is a wide difference between the position of salaried staff, from whom it would be almost impossible to recover millions of pounds, and those who stand for office in an elective council? Is it not obvious that there is a clear legal distinction between the position of the two?

§ Baroness Cumberlege
My Lords, my noble and learned friend is right. There is a great distinction.

§ Lord Molloy
My Lords, is the Minister aware that in examining the issue the Public Accounts Committee of another place stated: It is not just blatant inefficiency but a new kind of corruption of standards of every kind"? 1262 Should that not to be investigated? Are we to give no support to the Public Accounts Committee, which wants individual examination of the fact that the Wessex computer cost £63 million?

§ Baroness Cumberlege
My Lords, it is not a question of £63 million. The Public Accounts Committee stressed that a large amount of money had been recovered. The figure is much smaller; it is £20 million. The management executive took immediate action to disseminate the lessons that have been learnt. That was welcomed by the Public Accounts Committee. The Secretary of State has announced a review of manpower functions in the NHS. She has introduced new guidance on the standard of business and recently launched a new code of conduct and a code of accountability which are to be vigorously pursued by the National Health Service.

§ The Countess of Mar
My Lords, the Minister mentioned the figure of £20 million. She will accept that that represents a great deal of treatment for patients. Will she guarantee that in the cases of the Wessex Regional Health Authority and the West Midlands Regional Health Authority, where a similar amount of money has gone astray, patients are not being penalised for the loss of money and any money put aside for treatment is still available?

§ Baroness Cumberlege
My Lords, I can give that assurance. Any loss of funds is deeply regrettable. It is a matter that we do not condone and that we monitor and challenge. The Wessex Regional Health Authority budget is more than £1 billion. This year alone £83 million has been spent on new health care developments.

§ Lord Harmar-Nicholls
My Lords, will my noble friend clear my mind on this point?

Noble Lords
No!

§ Lord Harmar-Nicholls
My Lords, my noble friend may be able to do just that. While the Minister has no power to surcharge, as is implied in the Question, is it not a fact that if any member of an authority or a trust maliciously, deliberately or fraudulently misuses money he is not immune from the normal actions that can be taken in dealing with such matters? The suggestion that the Minister has no power to surcharge does not absolve the authorities from ensuring that the law is adhered to, and such people are not immune from that.

§ Baroness Cumberlege
My Lords, I am grateful to my noble friend for his crystal clear mind. He is absolutely right. There has been the action through the courts and through the normal channels that one would expect from the Government.

§ Baroness Jay of Paddington
My Lords, I return to the question about surcharging and salaried employees. Will the Minister confirm that the people who were most criticised in the Public Accounts Committee report, specifically as regards Wessex but more 1263 generally, were not salaried employees but were the appointed chairmen and the appointed non-executive members of various bodies?

§ Baroness Cumberlege
My Lords, action was taken both in Wessex and the West Midlands. There have been changes of chairman and non-executive members, as one would expect.

§ Lord Gisborough
My Lords, does this matter not enhance the need for privatisation within such services so that private money and enterprise rather than public money are at risk?

§ Baroness Cumberlege
My Lords, the Government believe that there are great advantages in privatising parts of the National Health Service. Indeed, we have saved millions of pounds, in particular on cleaning and catering services.

§ Lord. Monkswell
My Lords, where public money has been misused, local councillors can be surcharged and debarred from either being or standing as councillors. Is not the correct analogy in this case that Conservative Members of the House of Commons and Government Ministers should be disbarred from holding public office and should be surcharged for the amount of public money that has been lost?

§ Baroness Cumberlege
My Lords, I do not believe that I can take this matter any further. It is clear that we have no powers to surcharge non-executive members of health authorities. But there are other means, and action has been taken. Many of those people are no longer in the positions they occupied when the incidents took place.

§ Lord Richard
My Lords, the noble Baroness says that she cannot take the matter further, but I asked her a specific question. Will the Government give serious consideration to taking or attempting to take powers to surcharge? She has not yet answered that question. She can ask the noble Lord the Leader of the House to whisper the answer in her ear as much as she likes. Will the Government not accept, through the mouth of the Minister, that there is increasing public anxiety about this matter? Will the Government not take it seriously?

§ Baroness Cumberlege
My Lords, we take these matters very seriously. Clearly, I shall report to my right honourable friend the Secretary of State the debate which has taken place today and the matter will be considered.

§ Lord Sefton of Garston
My Lords, are the Minister and the Government satisfied with the present method of control that is applied to councillors? If they are, will they launch a Bill to impose similar controls in regard to the people covered by the Question because if they do, it will receive the support of this side of the House?

§ Baroness Cumberlege
My Lords, the issues concerning local government are not part of my portfolio. That is for other noble Lords on the Front Bench. In this instance I wish to reiterate that the 1264 Government took action. Indeed, the Public Accounts Committee complimented the Secretary of State and the management executive on the action that was taken.