Croydon Council calls for joint review into financial mismanagement at NHS Croydon
CROYDON Council is calling for a joint review into financial mismanagement at NHS Croydon.
An independent report, published last Tuesday, found a culture of "significant deficiencies" in the primary care trust's (PCT) financial controls led to a deficit of £23 million in 2010/11.
Council leader Mike Fisher criticised the investigation for failing to establish who was responsible.
Croydon has now joined other south west London authorities, including Wandsworth and Richmond, in calling for a review of the report.
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The investigation, commissioned by NHS London, exonerates directors and staff responsible for NHS Croydon's finances.
It concludes that "substandard financial processes" and "misplaced confidence" in its financial safeguards led the trust to post a surplus of £5.4m, when it had in fact overspent by at least £22.73m.
Cllr Fisher said he could not accept the conclusion the mismanagement it was "just a systems failure".
He explained: "The loss of control of finances at NHS Croydon was completely unacceptable and we need to make sure there is proper public accountability for what has happened.
"The independent report has established many of the facts but leaves open the question of public accountability for the decisions and actions that were taken or not taken, which allowed the situation to arise.
"Therefore, we think it only right in the circumstances for the boroughs within the South London Partnership to establish a joint scrutiny and overview committee specifically to try and understand how this happened and where the responsibility lies.
"The committee would also review the good progress which would appear to have been made since the terms of financial recovery, to assure ourselves this is real and sustainable."
Cllr Fisher added that it "made sense" to undertake a joint review alongside Richmond, Sutton, Merton, Kingston and Wandsworth because all six PCTs had been affected by the re-allocation of resources following the deficit.
In response to Cllr Fisher's initial criticisms NHS London said: "This report makes it very clear mistakes were made, and that these were due to poor systems and controls which failed to pick up errors made but found that no individuals were entirely at fault."
The investigation could find no evidence of fraud and concluded that all the money had been spent on health services in Croydon.
Last week the Advertiser revealed auditors Ernst & Young were paid £1m to conduct the review which was only commissioned after the Audit Commission, paid £275,000, failed to detect the deficit and gave the accounts a clean bill of health.
Cllr Ravi Govinda, leader of Wandsworth Council, echoed Cllr Fisher's concerns about the lack of accountability.
He said: "It is important for us to ensure all necessary lessons are learned, and that public money is better safeguarded in the future. This needs to be a transparent process and one that involves accountable NHS managers."
Cllr Lord True, leader of Richmond Council, said: "The NHS report describes a process that can only be described as a shambles yet has nothing to say about accountability.
"NHS Croydon was spending money it did not have - and some of it came from financially competent PCTs like Richmond, taking funds which were originally provided for the benefit of our communities.
"What we see is a complete failure of financial management, woefully weak corporate governance and an apparently ineffective external audit.
"I hope a joint scrutiny by the south west London boroughs will expose the proper accountability issues; it is only in this way that lessons can be truly learnt and the public have any confidence their money is in safe hands."