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The BBC's Daniel Sandford
"Much of the fraud is committed by GP's, Dentists and Pharmacists"
 real 56k

The BBC's Chris Hogg
"The annual 'helath check' of the NHS finances"
 real 28k

Former NHS trust chairman Roy Lilley
"The current anti-fraud measures are not working"
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Thursday, 12 July, 2001, 07:00 GMT 08:00 UK
NHS fraud levels exposed
Increasing numbers of health authorities and trusts have reported a deficit
Increasing numbers of health authorities and trusts have reported a deficit
More cases of NHS fraud are being investigated than ever before, according to the National Audit Office.

Its latest report on NHS finances shows the number of cases almost doubled between the years 1998-1999 and 1999-2000.

The independent audit also revealed health authorities and trusts ran up higher debts than the previous year.

At the end of March 2000, there were 239 fraud cases with a total value of 14m being investigated, compared to 484 cases worth an estimated 18m in March 2001.

I welcome improvements in financial control within the NHS and the initiatives taken to counter fraud

Sir John Bourne,
National Audit Office
The discovery of more fraud is being attributed to the formation of the Directorate of Counter Fraud Services in 1998.

It was the first central body to tackle fraud in the NHS, and has set up a network of regional fraud detectors, and recruited a fraud-buster for each trust and health authority.

A "fraud hotline" was also set up so suspected cases could be reported.

Last year, 7m of illegally-gained money was recovered - though estimates suggest fraud costs the NHS 2bn a year.

The government has pledged to recover 6m taken in frauds by 2002, cut prescription charge evasion by 50% by 2003 and "reduce fraud to a minimum" within 10 years.

The current cases being investigated include 118 involving GPs, 24 involving hospital doctors or surgeons, 128 pharmacists, 37 dentists, 35 opticians and 117 NHS employees.

Alleged frauds include claims for non-existent patients and glasses for dead customers.


The annual examination of NHS finances by the NAO found 59 out of 99 health authorities were in debt in the year 1999-2000

The total debt for health authorities was 52m.

Some health authorities had deficits approaching 10% of their income.

In the previous year, 48 out of 100 authorities reported they were in debt.

The total deficit that year was 25m.

And 150 out of 377 hospital trusts reported they were in debt in 1999-2000. Trusts' total deficit was 77m.

Seventy-six had "significant financial difficulties".

In 1998-99, 98 out of 402 were in debt. The total debt for trusts was 36m.

But the NHS predicts health authorities will have a surplus of 45m, and trusts a much reduced deficit of 8m in the next financial year.

And health service managers point out the sums of debt involved are a tiny proportion of their total budgets and in most cases are an inevitable consequence of dealing with such large sums of money.

The report also looks at the NHS's liability for clinical negligence, and finds the value of known and anticipated cases stood at 3.9bn at the end of March 2000.

The NHS would not have to pay out that much in one year.

Better accounting

Sir John Bourne, head of the NAO, launched the report to parliament on Thursday.

He welcomed the counter-fraud initiatives, and the fact that in 1999-2000, there were 22 successful prosecutions and 34 successful disciplinary cases.

The NAO also praised the NHS for tightening up its accounting procedures.

Sir John said: "I welcome improvements in financial control within the NHS and the initiatives taken to counter fraud.

"The way forward will be to continue to improve corporate and clinical governance and to ensure that accounting for these large sums presents fully and clearly the financial position of health authorities and trusts."

Nigel Edwards, director of policy for the NHS Confederation, said the report did not reflect the current state of NHS finances.

"It's history, it doesn't reflect what's happening now, and the amount of money related to NHS expenditure is very small.

"If you're spending 45bn, you're not going to get your spending bang on the nail."

A spokesman for the directorate of counter fraud services told BBC News Online: "The increase does not mean there is more fraud, it means we are detecting more fraud."

But former NHS trust chairman Roy Lilley told the BBC: "The fact that fraud has gone up by such a huge amount will come as a huge disappointment.

"Clearly, the measures they have put in place to stop fraud just are not working."

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See also:

25 May 01 | Northern Ireland
Doctor jailed for massive fraud
04 Jul 01 | Health
NHS cash 'not getting to staff'
09 Nov 00 | Health
Fines for NHS fraudsters
28 Dec 99 | Health
Prescription fraud costs NHS 54m
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