§ Mr. HanleyTo ask the Secretary of State for Health (1) what criteria are being used for establishing asset management and capital charging within the National Health Service;
(2) what progress there has been in establishing efficient asset management and capital charging in the National Health Service; and if he will make a statement.
§ Mr. FreemanThe intention to introduce a system of capital charges was announced in the White Paper, "Working for Patients". Each hospital will be required to calculate and pay capital charges to its regional health authority from April 1991. The capital charge represents depreciation and interest calculated on the value of assets held. In order to facilitate the introduction of this scheme health authorities are being required to compile, value and maintain asset registers with effect from April 1990. This will enable the capital charging scheme to operate on a shadow basis during 1990–91. Managers will begin to understand the value of assets held and will, under the full scheme, have direct incentives to make best use of assets in order to minimise capital charges. In this way the capital charge scheme will be an impetus to good asset management, which the Government have been encouraging in the NHS in recent years.