Audit Committee, 03 Sep 2002
Meeting date: Tuesday, September 3, 2002
Official Report
120KB pdf
“Overview of the National Health Service in Scotland 2000/01”
We now move on to agenda item 4, on the response of the Scottish Executive to this committee's report entitled "Overview of the National Health Service in Scotland 2000/2001", which was published on 2 May.
Members may be disappointed to note that the Executive has not accepted one of our recommendations—recommendation 3, which relates to the tracking of the use of non-recurring funding by health boards. I must express a little disappointment in that, but I should say that, out of eight recommendations, recommendation 3 is the only one that has not been accepted. It is the first time that the Scottish Executive has not accepted one of our recommendations. However, I am happy to note the action that the Executive has taken on a range of other issues, including early action on deficit build-up; transparency in financial management below board level in the reorganised structure; deadlines for the full implementation of partnership agreements; communications in partnership with pharmacists to ensure modern and accurate accounting systems; the development of partnership agreements; and the monitoring of the financial processes in the NHS and the pressures on the NHS, to which the Executive has taken a very positive approach. Those positive responses from the Executive will help to improve the system for the benefit of patients and professionals alike.
I regret the negative reaction to one of our recommendations and I will seek to pursue the matter to ensure that the Executive clearly understands what we were proposing. I stand by our recommendation, which I feel would be beneficial. The issue it deals with is fundamental.
I am not at all happy with the Executive's response on that point. We should invite Mr Trevor Jones back to elaborate on what I regard as an inadequate explanation.
The explanation is faulty on two grounds: the use of non-recurring funds is clearly critical, because it can distort and disguise a board's financial position; and, if such things happen again, the Executive will have laid itself open to criticism for not having accepted our recommendation. I do not understand the Executive's position. We were not asking for anything very ambitious; we were simply asking for a system to be put in place.
I have re-read our recommendation. We were asking for reporting to the department, rather than reporting by the department. I would like that point to be made clear. Perhaps Arwel Roberts would like to comment.
Arwel Roberts (Audit Scotland):
There is a need for clarity here. The department has understood that the committee was recommending that the department itself should provide the mechanism for monitoring. Members will recall that a new management framework is being developed for the health service. At the time, the committee was concerned that there should be transparency down to what is now trust level. If the committee's position were made clear, I do not think that the department would have any difficulty in accepting that it should make arrangements whereby the trusts should make the relevant information available.
Our intention was not to put any extra burden on the department but simply to ensure that the department could get the information it required to have a proper overview of what is going on. Using non-recurring finance is no way to run a system; it can hide problems, rather than addressing them.
Does the committee agree that we should write back to the Executive to seek clarification?
Members indicated agreement.