HL Deb 10 June 1998 vol 590 c94WA
Lord Walton of Detchant

asked Her Majesty's Government:

Why they require health trusts to provide in their accounts for depreciation of their fixed assets and to pay the Government interest on that part of them notionally financed by "public dividend capital"; and whether:

  1. (a) without this requirement Oxfordshire Community Health Trust's most recently published accounts (1996–97) would show a surplus of £1.5 million; and
  2. (b) this requirement has led to the trust's proposal to close two community hospitals and implement an overall reduction of between 15 and 20 per cent. in community hospital beds in the county. [HL2071]

Baroness Jay of Paddington

National Health Service trusts are required to provide in their accounts for depreciation and to pay debt remuneration in order to recognise the cost to them of the capital they employ.

They are funded for these costs through their contracts with NHS purchasers.

The accounts for 1996–97 show that Oxfordshire Community Health Trust actually had a surplus of £332,000. The figure for the public dividend capital was £359,000. Other interest payments on government borrowing amounted to £1,073,000, but this was not public dividend capital.

It should be noted that the public dividend capital is not money which is returned to Her Majesty's Treasury. The money is kept within the NHS and every trust is treated similarly. In those circumstances the effect on services is negligible.

The decision to consult on the closure of community hospitals in the west of Oxfordshire is not linked to these figures.