§ Earl Howeasked Her Majesty's Government:
Why fees being collected by the Compensation Recovery Unit of the Benefits Agency on behalf of National Health Service hospitals are currently running at an annualised rate of some £70 million when, under the regulatory appraisal for the Road Traffic (NHS Charges) Act 1999, it was anticipated that fees collected would amount to £123 million to £165 million per annum. [HL4152]
§ The Parliamentary Under-Secretary of State, Department of Health (Lord Hunt of Kings Heath)The regulatory appraisal which accompanied the Road Traffic (NHS Charges) Act 1999 included an annex explaining how potential income from the new scheme had been calculated. The appraisal made clear that, in order to make the necessary calculations, a number of estimates had to be made based on data from a variety of sources.
Income has not reached the suggested levels largely because fewer than expected people have had NHS treatment following a road traffic accident and have gone on to make a successful claim for personal injury.
There may be other factors which need to be taken into account but it is still too early in the life of the new 98WA scheme to compare a comprehensive year's data from the scheme with our opening forecasts.
§ Earl Howeasked Her Majesty's Government:
What has been the cost of collecting fees paid to National Health Service hospitals under the Road Traffic (NHS Charges) Act 1999 expressed as a percentage of fees collected (a) during the year ended 5 April 2000 and (b) since April 2000.; and whether they consider these percentages to be satisfactory; and [HL4151]
Whether they consider the performance of the Compensation Recovery Unit of the Benefits Agency in collecting fees for National Health Service hospitals under the Road Traffic (NHS Charges) Act 1999 to be satisfactory; and [HL4153]
What was the full cost of collection of fees paid to National Health Service hospitals under the Road Traffic (NHS Charges) Act 1999 during its first year of implementation, including, if applicable, any capital charges; and what are the budgeted outturn figures for these costs during the second year. [HL4154]
§ Lord Hunt of Kings HeathFrom 5 April 1999 a new system of centralised collection of National Health Service charges following road traffic accidents was introduced. The system is administered by the Compensation Recovery Unit (CRU), a part of the Benefits Agency, on behalf of the Department of Health.
In the first year of operation, the full cost of the new system to the Department of Health was £1.2 million, including capital charges such as the costs of a new computer system. In that year, CRU collected and distributed £26 million to English NHS trusts. In the start-up year, the cost of collection was therefore 4.7 per cent of the amounts collected.
Six months into the second year of operation, CRU has collected and distributed £30 million to NHS trusts in England, suggesting that a full year figure of at least £60 million is possible. We have budgeted for costs of £1.06 million in the current year, which, if £60 million is achieved, would mean collection costs would be 1.8 per cent of the total amounts recovered.
The performance of CRU, after some initial difficulties associated with the introduction of a new IT system, and the cost of collection expressed as a percentage of income collected, are fully acceptable to the Department of Health. The new scheme has dramatically increased the amounts being recovered and this money is already available to NHS trusts to improve patient care.