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‘Unauthorised payoffs’ made to senior staff at six NHS organisations

Published on: 31 Jan 2023

NHS England has been criticised by national auditors after a spate of unauthorised payoffs to departing commissioning staff, and warned that the move to integrated care boards may bring more.

The auditor general identified six “irregular” special severance payments, made without the required NHS England and Treasury authorisation, during 2021-22, which were disclosed in NHSE accounts published yesterday.

Five were paid by clinical commissioning groups and one by a commissioning support unit. The auditor general, Gareth Davies, indicated he was concerned about a trend, as he had also identified three unauthorised payoffs in 2020-21.

Mr Davies said it showed the regulations for exits awards were “still not sufficiently well understood” across the NHS. “I consider the structural changes across the NHS England group that take place during 2022-23 mean there continues to be an increased likelihood of further exit packages and specifically special severance payments.”

CCGs were subsumed into integrated care boards in July, but many are still going through restructure and are expected to make redundancies. Meanwhile, NHSE is going through a major restructure of its own, including a merger with NHS Digital and Health Education England this year.

The payments in 2020-21 included £81,000 paid to a former senior employee by the three CCGs which merged into Suffolk and North East Essex ICB, which were not submitted to NHSE and the Treasury for approval.

Meanwhile Kernow CCG recorded three severance payments adding up to more than £50,000, which were found to be “irregular”.

The other organisations flagged in the report for irregular exit payments include the North of England Commissioning Support Unit (£5,256) and Bristol, North Somerset and South Gloucestershire CCG (£5,389), where the ICB said it had received retrospective approval.

NHSE said in the accounts that it was implementing a series of extra controls on severance packages, including sign-off by NHSE regional teams. It said: “Due to the recent implementation of the additional controls noted above, we anticipate seeing improved compliance with severance payment processes in 2022-23.”

HSJ contacted the successor ICBs to the CCGs named, but they did not provide further comment.

Serious control failings

Meanwhile, the 2021-22 NHSE accounts revealed that “serious control failing[s]” had led to two suspended GPs receiving nearly £1m in incorrect payments. 

One doctor who had been suspended received £489,766 between 2017-18 and 2021-22 which he or she was not entitled to. Another clinician continued receiving suspension payments adding up to £473,747 despite being removed from the medical register four years previously. NHSE is unlikely to be able to recover the payments, the accounts state.

They explain: ”If a medical practitioner is suspended, they may be entitled to receive payments under the statutory regulations. During the reporting period, NHS England identified payments to two medical practitioners beyond the entitlement period and sum respectively…

“New management processes with regard to suspension payments helped to identify these payments, whereby incorrect application of the policy occurred, resulting in an overpayment and failure to cease suspension payments when the practitioner was no longer eligible.

NHS England has taken several steps to improve the internal controls of how suspension payments are managed. This includes implementing new procedural guidance that ensures that payments are not made to medical practitioners until entitlement to suspension payment is validated by a named responsible individual in the region.”

High price of the pandemic

The public spending watchdog last week issued a highly critical assessment of the Department of Health and Social Care’s financial management during the second year of the pandemic.

The National Audit Office said the DHSC had written off almost £15bn on personal protective equipment that it no longer expects to use or cannot sell at the price it paid. Officials were unable to physically check and verify another £2.9bn of PPE and lateral flow tests that are held in containers.

Gareth Davies, the Comptroller and Auditor General, was unable to sign-off on the accounts of the UK Health Security Agency, which is part of the DHSC, because of what he called “significant shortcomings in financial control and governance”.

UKHSA was created in April 2021 by merging elements of the now defunct Public Health England with the Test and Trace programme. The NAO said there had been “no clear oversight structure” the first six months of the agency’s existence, in part due to a lack of support from the DHSC.

In a letter to the Commons public accounts committee, UKHSA CEO Dame Jenny Harries said “there were many factors that UKHSA inherited or were outside the agency’s control”.