The sentencing last week of Mid Essex Hospital Services NHS Trust finance director Philip Neal to a 12 month behind bars for false accounting highlighted the pressure on FDs to avoid reporting deficits.
Neal was convicted for submitting inflated valuations on land the trust was to sell to report a £1m surplus in accounts for the financial year 2005-06 when, in fact, the trust was £10m in deficit. Neal blamed NHS targets in his defence.
Noel Plumridge, a former FD of Kingston District Community Trust said: ‘There’s an expectation within some boards that FDs will pull a rabbit out of the hat at year-end and FDs rise to it. It is about an expectation on the FD to turn a deficit into a break-even, which means an accounting trick rather than a change in reality of income and expenditure.’
Ian Perkin, former FD of St George’s NHS Trust said: ‘There is no good picking on an individual you have to create a healthier environment where people don’t fear for their jobs if they report bad news.’
A spokeswoman for the Department of Health said: ‘The majority of trusts are in surplus as a result of sound financial management and the efficient use of resources. To suggest it is necessary to commit fraud is ludicrous.’
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