Select Committee on Public Accounts Appendices to the Minutes of Evidence


Memorandum submitted by the NHS Executive (PAC 2000—01/157)

Question 90

  In addition, I would like to clarify the response given to question 90 from Mr Campbell about whether the non-NHS sector could be making a profit from blood supplied by the NBS.

  As a condition of supply, non-NHS hospitals are required not to make a profit on the material supplied. This condition was part of the arrangements when charging was introduced in 1 April 1984. Such a condition was a routine feature of contracts governing the provision of the majority of blood supplied to the non-NHS sector under the previous zonal contracts used by the NBS. Inadvertently this clause was omitted from the standard national contract introduced by the NBS from 1 April 1999. As soon as this was realised NBS made arrangements to rectify this omission immediately.

  However, there is no evidence to suggest that non-NHS hospitals have every attempted to make profits on blood. Immediate action would be taken on evidence of any breach of this long-standing requirement.

  Finally, you asked Mr Gorham to explain why he did not raise the issue concerning cross infection from a donor with the human variant of BSE to haemophiliac recipients that appeared in the news the following day. We are sorry if the Committee feels there was any question of withholding information but this is certainly not the case. The matter has, in fact, been in the public domain since last December and received media attention on several occasions since then—for example, newspaper articles in The Times (26 December and 29 January) and The Guardian (19 January). Neither the NBS nor the Department is, of course, responsible for the timing or content of media reports.

  Although CJD was mentioned several times in the course of the hearing, this was always in the context of current or possible future action to reduce risk of transmission. This particular story relates to a donor who gave blood before the switch to US plasma and has since developed CJD. Had a relevant question been asked it would certainly have been answered.

Question 17

  We understand that the Microbial Safety and Tissues for Transplantation Committee plan to provide the Department with its considered views on 19 April. If the Public Accounts Committee has not published its report by that date, we will send a further note at that time detailing the advice received.

Question 55

  NBA collects, processes and supplies blood in North Wales through an arrangement made with the Welsh Blood Service.

  The powers of the National Assembly for Wales to call for witnesses and documents are in section 74 of the 1998 Act. The powers are limited to bodies specified in Schedules 4 and 5 of the Act. UK Ministers and their departments are not included in those schedules, nor is the NBA and therefore cannot be required to attend.

  The protocols surrounding invitations to civil servants working for the UK Government to give evidence to a Committee of a devolved legislature are contained in Devolution Guidance Note 12, which is available from A copy of DGN 12 is attached.[1]

Question 59

  The decision of the then Secretary of State that it was not in the interests of the NHS for Sir Colin Walker to remain as Chairman of the NBA was taken on the basis of his judgement that Sir Colin had mismanaged organisational change within the Blood Service. In his view, in doing so Sir Colin had lost the confidence of the Service's medical and other staff, donors and the public and had done considerable damage to the reputation and good standing of the Service. There was never at any time a question that action taken by Sir Colin had had a detrimental effect on safety or caused risk to the public.

Question 191

  There is no necessary or direct relationship between stock movements (Figure 11) and donor potential and collections, and stock movements vary year on year. In 2000, for example, the net flow into the London and South East Zone was only slightly greater than into the Northern Zone. Historically in Midlands and South West the donor potential and collection capability has always exceeded local demand.

  We have not seen the figures on which NAO base their finding ie we do not know the extent to which Londoners are disproportionately represented among recent donors. However, London is also a disproportionately heavy consumer of blood because of the preponderance of large acute hospitals.

Question 195

  The £1.9 million does not represent the cost of clinical negligence settlements in 1998-99. The figure is taken from the NBA's audited accounts for the year, which by accounting convention have to include "provisions" for any future payments which might arise from events happening in that year. The bulk of the £1.9 million reported in 1998-99 was in respect of provisions, £1.7 million in respect of a single on-going class action by people who claim to have been infected with the Hepatitis C virus from contaminated blood received in the early 1990s. 1998-99 was the first year in which the NBA was advised by its lawyers that the likelihood of eventually having to pay this sum had increased to over 50 per cent—the point at which, by the then current accounting convention, the provision had to be shown in the accounts. In previous years the likelihood of having to pay was deemed to be less than 50 per cent, so the potential liability had previously been shown as a "contingent liability".

  The £1.7 million was represented by 56 cases at a payment of £14,000 net of the estimated cost of settlement contribution from the centrally (Vote) funded Existing Liabilities Scheme, of which all NHS bodies are members; and eight cases at an estimated cost of £56,000 net of the ELS contribution. A further £400,000 represented the anticipated legal costs of defending the claims.

  A further £77,000 was provisions in respect of an outstanding claim from a patient who received a transfusion of blood contaminated by bacteria.

  Of the remainder, £130,000 does represent actual in-year payments, mainly for small claims by donors for bruising. In addition £28,000 was paid as the NBA's contribution to the NHS Litigation Authority—administered Clinical Negligence Scheme for Trusts, ie the NHS's own risk pooling scheme for clinical negligence events occurring after 31 March 1995.

NHS Executive

1   See Annex A, p21-24. Back

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