PracticeAuditHospital audits questioned

Hospital audits questioned

MPs have questioned the future accountability of hospitals after it was revealed trusts will be able to appoint their own auditors for the first time if proposals by the government to create NHS foundation hospitals are passed.

Link: Hospital accounting treatment confirmed

According to current legislation, all audits of hospital trusts are carried out under the control of the Audit Commission, a government body aimed at ensuring value for money in public services such as health.

The proposals for foundation hospitals would provide greater autonomy for the best performing trusts, including the ability to register as a free-standing legal entity at Companies House and appoint its own auditor.

Labour MP Glenda Jackson, who voted for a rebel amendment to the proposals, told Accountancy Age: ‘There is a serious worry over the issue of accountability, not only on the subject of audit but also with regulation. These trusts will no longer be accountable to MPs and therefore the public.’Concerns about audit will form a new front between Commons backbenchers and health secretary Alan Milburn.

The new foundation hospitals, if approved, will be held to account locally rather than from Whitehall. They will still be subject to reviews by the Commission for Healthcare Audit and Inspection, and independent healthcare providers, but will have an unprecedented level of financial freedom. This has led to concerns that more money will be diverted away from patient care to paying accounting firms.

There is still some way to go before the proposals are implemented. Despite narrow approval at the recent parliament debate, the government has backtracked over several of the issues and more changes could be suggested at the committee stage.

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