Doubts over the audit arrangements for the government's controversial foundation hospital proposals have grown after it emerged that a government spending watchdog has reservations about the plans for accountability in the new trusts.
As revealed in Accountancy Age last week, foundation hospitals will for the first time be able to appoint their own private auditor instead of having the audit carried out under the remit of the Audit Commission.
Audit Commission chairman James Strachan has since written to health secretary Alan Milburn expressing his concern that these arrangements may not be in the public interest.
Strachan said that a private audit check may confirm that the books are balanced, but was not the same as a public sector audit of performance, value for money and of governance.
A spokeswoman for the Department of Health said that, under the proposals, a foundation hospital would still be able to receive an audit in the same way as it currently does if it so wished, but warned that those choosing the private path would mean accepting all the costs that came with it.
Labour has so far faced a massive rebellion against foundation hospitals, but the proposals have now been sent to a committee filled with Labour loyalists. However, MP Glenda Jackson, who voted against foundation hospitals in the recent commons vote, told Accountancy Age that she expected the bill to be ‘savaged’ when it reaches the House of Lords.