NHS Trusts: Subsidiary Companies

(asked on 27th January 2020) - View Source

Question to the Department of Health and Social Care:

To ask the Secretary of State for Health and Social Care, what organisations he will consult prior to the publication of a revised Addendum to the transactions guidance for NHS trusts forming or changing a subsidiary.


Answered by
Edward Argar Portrait
Edward Argar
Minister of State (Ministry of Justice)
This question was answered on 3rd February 2020

The Department wrote out to the finance directors of all National Health Service providers in September 2017 reminding them of their responsibilities around tax and advising that tax avoidance arrangements should not be entered into under any circumstances. We would expect all NHS providers to follow this guidance when considering any new arrangements or different ways of working.

The Department does not hold information on the decisions taken locally by NHS trusts and wholly owned subsidiary companies regarding the reward packages they offer to staff.

Staff who are compulsorily transferred from an NHS organisation to a wholly owned subsidiary retain their employment terms and conditions, in accordance with Transfer of Undertakings (Protection of Employment) Regulations 2006, and access to the NHS Pension Scheme, in accordance with HM Treasury’s New Fair Deal guidance.

NHS trusts with wholly owned subsidiaries can choose to offer terms and conditional of service that are different to those on national terms for new starters. Trusts can also apply for access to the NHS Pension Scheme for new starters.

As part of its subsidiary review process, NHS England and NHS Improvement considers businesses cases from hospital trusts at the planning stage only and does not hold any data with regard to the future performance of wholly owned subsidiaries.

NHS England and NHS Improvement carried out a formal consultation on the Addendum to the transactions guidance published in November 2018. It does not intend to carry out a further consultation as part of the planned update to the Addendum to the transactions guidance, but has been engaging with the Department, NHS Providers, provider trusts, trade unions and internal subject matter experts as part of the planned update.

NHS England and NHS Improvement plans to publish an updated Addendum to the transactions guidance in spring 2020.

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