Examination of Witnesses (Questins 120-128)
CABINET OFFICE,
DEPARTMENT OF
HEALTH & HM PRISON
SERVICE
12 DECEMBER 2007
Q120 Mr Bacon: When do you think
it will be solved?
Ms Diggle: I would have to look
into that for you, I am afraid.[4]
Q121 Mr Bacon: Will you write to
us?
Ms Diggle: Certainly.
Q122 Chairman: I have one last question
for you, Mr Coates, in figure 12 on page 22, it says at the bottom
of the second paragraph that 65% of invoices in Queen Elizabeth
Hospital NHS Trust are backed by a purchase order (PO) compared
with an average of 30% for all Shared Business Services customers.
It is pretty devastating that only 30% of those invoices are backed
by a purchase order, is it not?
Mr Coates: It does demonstrate
poor management of the way a trust goes about issuing orders to
its contractors, yes.
Q123 Chairman: It is more than poor
management. As I understand the way the public sector works, you
have a purchase order and then you know you have an invoice, it
makes sense, does it not?
Mr Coates: I agree that—
Q124 Chairman: It is staggering that
only 30% are backed by one.
Mr Coates: I agree but hospitals
work in certain ways and there is little chance of mistakes or
fraud because ultimately the PO is raised retrospectively rather
than prospectively. In other words, once the order has been placed,
the orderer has to then raise the matching PO, so it is a management
issue rather than a process issue or a fraud issue.
Q125 Mr Bacon: Why does the NHS employ
300 people in the NHS Counter-fraud Security Agency if there is
little risk of fraud?
Mr Coates: On this particular
issue I was talking about, not generally.
Q126 Chairman: Does this answer stack
up? Can I ask the National Audit Office, is this right that because
of the way the NHS works that it does not really matter that only
30% of invoices are backed by a purchase order? That is what we
have just been told.
Sir John Bourn: Basically of course
it does matter because there would be no point in having both
of them to compare unless it served a purpose. But of course,
as Mr Coates says, you find different systems occurring in different
lines of activity. The whole question is whether you find something
which is different and prima facie surprising, is it justifiable
or does it need correction?
Q127 Chairman: Do you think it needs
correction, Mr Coates?
Mr Coates: I think good practice
would dictate that the numbers should be the other way round,
yes.
Q128 Chairman: So does it need correction?
Mr Coates: We are trying to correct
it by bringing in electronic invoicing to prevent POs being raised
retrospectively.
Chairman: Thank you, lady and gentlemen,
for your attendance and let us hope you find £7 billion.
Thank you very much.
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