Select Committee on Public Accounts Minutes of Evidence


Examination of Witnesses (Questions 80 - 99)

MONDAY 14 JANUARY 2002

MR NIGEL CRISP AND MR ANDREW FOSTER

  80. If people were prepared to cheat because of the targets that were set then, the targets are going to be more severe now, how are you going to be certain that there are not going to be more who will cheat because the targets will get worse, as far as they can see it?
  (Mr Crisp) I think the two big points are, firstly, the openness one, so that it is patients who can actually see what the arrangements are in their local trust and can identify how they fit in with that. I think that is a very big and powerful message and the NHS needs to be becoming much more patient driven in that sense. The second thing is we have put in here, as you said, in the press release and elsewhere, a number of safeguards about quality, including the Audit Commission spot-checks. These will help us move on.

  81. You probably will not answer this question but I will try anyway. Are the targets that are being set reasonable or not?
  (Mr Crisp) I believe that they are reasonable. I believe we can do it. I can see movement in the right direction. I can also see that some trusts are well down the track already. I think at this moment, of course, we have got a financial settlement that will see us through to the targets over the period of that financial settlement.

  Chairman: These are policy matters, we do not need to go into that.

  82. Has every trust been checked to see that everything is okay?
  (Mr Crisp) It depends what you mean by that. As you will be aware from your last Report, the National Audit Office took the view that our information was satisfactory for its purpose with some exceptions. What we are doing here is wherever there are trigger points which give us worry about the trust, and I have indicated what some of those will be, then we will make sure that there is a detailed inspection. We do not actually audit every waiting list position.

  83. I will move on to a different topic now. I do not think one could do this Report without asking some questions on the topic that Mr Williams brought up. When I read it, I wrote down that the NHS must be the only organisation where employees who face disciplinary charges come out of it better off. Let us look at some of the financial positions. On page three, and Mr Williams brought this up, it says that at four trusts seven staff were suspended, four eventually resigned receiving something like £260,000 compensation. At Plymouth two received £146,000 with confidentiality clauses and clear references. Then we have the one that Mr Williams brought up on page 7, Surrey and Sussex, fiddling, manipulation, fraud, and yet he walks away with £95,000 compensation with a confidentiality clause and no claw back. In both cases it was clear that it was not just manipulation, it was clear fraud. These compensation payments cannot be justified and yet it happens time and time and time again, not just in the NHS but other public services.
  (Mr Crisp) And you may want to enquire whether it happens in the private sector as well. I have no doubt that people make pragmatic decisions. What we need to be clear about is that some of the people we are talking about here in these cases certainly do not accept that they were in the wrong and that was, in part, because disciplinary procedures were not completed. I want to be careful in saying that. What people did here was they took the pragmatic view as chairs or as boards that it would be less costly, there would be less disruption for patients—

  84. How can you say it will be less costly to pay somebody £95,000 for not doing their job properly? How can it cost you more if disciplinary action is taken?
  (Mr Crisp) Let me bring in Mr Foster again.
  (Mr Foster) A body taking a decision of this nature would take external advice. We see reference in some of these cases to advice from lawyers about the percentage chance of success in an industrial tribunal. An employer would have to take into account what the prospects of success would be were their decision challenged in a tribunal and would have to take into account the likely legal costs associated with fighting the case, and they may well be advised therefore that to take a certain course of action to pursue disciplinary procedure risks loss of case, risks significant compensation and risks significant legal costs, and so they are faced with a choice to make (professionally advised) as to whether to compromise on a lesser sum. That is the sort of issue that employers are faced with and they have a duty to protect the public purse and they have a duty to spend the minimum amount of public money on these cases. I can quite understand circumstances where they may be so advised.

  85. I am told time is up so I cannot pursue that. I am sorry, I find that an incredible answer. Regardless of what lawyers are telling you, it is about time that somebody took a stand and said, "This person is incompetent, this person did not do the job properly, he or she is sacked and we are not paying £95,000 in compensation, take us to court."
  (Mr Crisp) We also have to prove these things. These are issues of judgement and it is a minority of cases.

  Mr Steinberg: Let me give you an example in the North East of England not in the Health Service but in the police force. A certain policeman has been suspended now for three or four years but the constabulary will not allow him to resign because at the end of the day they are going to take it right to the very end. Whether the man is guilty or not, I do not know, but they have not allowed him to resign so the case can be brought.

  Chairman: A good question but unfortunately you are not responsible for the police force.

  Mr Steinberg: The NHS could do something similar.

  Chairman: Thank you very much, Mr Steinberg. Mr Geraint Davies?

Geraint Davies

  86. Can I start where Mr Steinberg left off because he ran out of time. Mr Foster, what you seem to be saying, if I understand you correctly, is if the legal and other possible down side costs of pursuing a certain case clearly outweigh the cost of seeing it right through, then obviously you may have a situation where you have a confidentiality clause and someone who has basically manipulated and distorted the figures ends up elsewhere in the NHS in a similar position presumably doing the same. Do you think there is a conflict here between the financial interests of an individual trust perhaps and the wider interests, financial for the moment, of the NHS and, more importantly, the interests of possible patients who may find themselves not being treated because of your microscopic commercial decision?
  (Mr Foster) As Mr Crisp has said, this is a matter of judgment. We are talking about people who have not been proven to be guilty of this and the employer, on external expert advice, making a judgment as to the likely success of going through proper proceedings. I am not saying that every single one of those judgments is necessarily correct but I can understand the circumstances under which an employing trust is told, "If you take this course of action it will cost you a certain amount, if you take the other course of action, there is a risk of it costing you a lot more. If it costs you a lot more, you have then got to explain to your auditors in your accounts why you have used money which is allocated for patient care for taking a particular course of action."

  87. So you would accept that there is a conflict of interest between auditors on the one hand and the treating of future patients? Can I ask you, Mr Crisp, to comment in your response on this quote from your press release from December 2001 which concludes: "In future, any manager found to have deliberately distorted waiting figures will face dismissal on grounds of gross misconduct. This will be supported by a new Code of Conduct for NHS managers. Anyone who breaches that Code of Conduct will not be re-employed as a manager—anywhere in the NHS." Is that your position or is your position Mr Foster's that this will happen as long as the numbers add up and if they do not this chap or this woman will have another go elsewhere?
  (Mr Crisp) What I was going to say, Mr Davies, was I take your point. I think what Mr Foster has been explaining to us is the position that people have to consider in making their judgment. It is not a conflict of interest, I think it is a different set of considerations that a trust board has to decide. They have to decide how they are spending money from the public purse and, as Mr Foster said, explain that to their auditors if they are doing it in a way that appears to be different from what their auditors would be saying. They also have to take into consideration the greater good of the NHS in the light of what we have been saying. I think this Report has helpfully brought this out.

  88. Can I ask you something slightly different but similar, namely, if, on the balance of risk, it was decided by managers not to pursue an individual manager who may be culpable but had agreed to resign (given the circumstances of fiddled waiting lists) and it is decided not to pursue him and a confidentiality clause is released, are you now saying that you will undertake to make sure that the information is made available not only to subsequent trusts but to the public?
  (Mr Crisp) Let's be careful exactly what we are saying here. What we are saying is that we will put in directions which will deal with the issue of confidentiality, so take that out of the equation, we will not have confidentiality agreements, it will also deal with claw-back if there is any payment here, and it will also deal with references, so that references are available. If somebody has not gone through a disciplinary procedure then you have to be very careful about precisely what the references are saying. But there is another consideration which trust boards take into account (and this is why we have good chairs and experienced people on boards) which is what is the best deal for their local patients as well, because in some cases it is better to not to have a long, protracted disciplinary process but to get somebody in there quickly to move it on.

  89. Say that you and I are running a trust together and the Chief Executive "Frank Jones" suddenly discovered there was a big problem with fraudulent waiting list statistics, manipulated outputs and Frank said, "I am resigning, I am going to get another job," and the board said, "Why don't we have a fresh start, get on with it. We know what was going wrong with it from our investigation, Frank Jones has gone, let's get on with it." The alternative is to pursue him in a situation where it is very expensive and time-consuming and uncertain in terms of the evidence and it is unclear whether we will find him guilty or not guilty and the easy way forward is to let him go and he will end up presumably with a hand-out and running another trust.
  (Mr Crisp) I think that under-estimates the quality of the people we have got as non-executives on our trusts.

  90. What are you doing to stop that easy choice being made in individual trusts?
  (Mr Crisp) I have to say I do not think anyone has made any easy choices here. I think, having talked to a number of people, that people have agonised over this because you have to balance getting on with things and making a clean start, fairness to the individual, rightness to the NHS, and the accountability issues that Mr Foster has pulled out. What we are saying is that we are going to make it easier for trust boards in the future because, as the press release says, we are going to say that our expectation is that people will be held to account.

  91. If I were sitting on a board and a Chief Executive's position came up and somebody applied for this who was on the chicken run, who had escaped before the results of an inquiry had emerged—and you mentioned the case of Barts where people did the chicken run before the outputs came through—would I somehow know that as an interviewer, for argument's sake, through your system or would I know in retrospect that I would be able to sack that person if I found information which came to light after he was appointed, and are these systems now in place?
  (Mr Crisp) The two points are that you should either have a reference from a current employer, or the individual applying for the job with you should tell you at interview, otherwise you have got a case in terms of your appointment process for dismissing them if relevant information is not provided.

  92. In the case of Barts and the London—I do not know if you know the answer to this—was it not the case that the Chief Executive went off and only junior staff were left. Do you know what happened to the Chief Executive of that trust? Did he get another job?
  (Mr Crisp) On Barts and the London there were four people who left if you look at the statistics. There was a wider review on the back of which the Chief Executive, who was and is indeed an extremely honourable man, took the view that as this was happening under his stewardship, it was appropriate that he should go, although he was not directly involved, and he has left and is not working in the NHS.

  93. When did he leave?
  (Mr Crisp) I do not have that date here but it was some time in 2000. The chair also resigned and the two senior managers are not working in the NHS, I checked that, so none of the four people involved are working in the NHS.

  94. You were the London Regional Director until 1999.
  (Mr Crisp) That is why I am familiar with the situation.

  95. He left and did he get another job, did you say?
  (Mr Crisp) No.
  (Mr Foster) Can I say something about this point which you have been pressing us on because we have said that we will be producing a new Code of Conduct and there are certain issues we will have to consider about how it operates, so that, for example, at the moment if a consultant is about to undergo disciplinary procedures and then resigns so that disciplinary proceedings cannot be concluded, nonetheless, an alert is issued to the various bodies to ensure that he is not re-employed without the issue being sorted out. We must find a similar mechanism to address exactly the problem you are raising so that you cannot simply get away from this just by resigning. You have got to have a tagging mechanism—

  96. And you are putting that in place?
  (Mr Foster) We will have to find the best mechanism of doing that.

  97. My understanding, correct me if I am wrong, is that we are talking in this Report about nine out of 300 trusts? Are you saying there is only a problem like this in those nine or is that the nine we know about?
  (Mr Crisp) They are the nine that we have found. I ought to say that these are the ones that came up, five from the NHS and four from people alerting, that we found over a period of about four years.

  98. You are confident that it is not more than 12, for argument's sake?
  (Mr Crisp) You have added another three.

  99. I know I have.
  (Mr Crisp) I am pretty confident that this is the order of magnitude at most that we are talking about. There may be one or two others.


 
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