2 Monitor's resources and capability
12. Monitor's spending trebled between
2010-11 and 2013-14, as the job of regulating NHS foundation trusts
became more challenging and it prepared to take on new responsibilities.
In 2013-14, its budget for core running costs was £48 million.
Approaching a third of this amount (over £15 million) was
earmarked for central services, compared with £9 million
for regulating NHS foundation trusts and £5 million for assessing
NHS trusts applying for foundation trust status.[12]
Following our hearing, Monitor advised us that most of the 78
central services staff worked in strategic communications (30
people) or knowledge and information management (23 people).[13]
13. The number of staff Monitor employs
has also increased significantly in recent years. At 31 December
2013, it had 337 staff, 75% of the 450 staff it expects to need
to carry out all its functions. Monitor told us that it made extensive
use of consultants to plug gaps in its expertise and to deal with
peaks and troughs in its workload. It acknowledged that using
consultants was both costly, accounting for £9 million of
its £48 million budget in 2013-14, and did not help it to
develop its own knowledge and expertise. It was seeking to reduce
its dependence on external consultants and was looking into whether
it could build in-house capability, which it could then share
with the NHS Trust Development Authority and NHS England.[14]
14. The National Audit Office reported
that Monitor's staff were high calibre, particularly in terms
of their financial and business expertise. However, some had insufficient
operational experience or understanding of clinical issues, which
damaged their credibility and effectiveness. Monitor confirmed
that just 21 of its 337 staff had an NHS operational background,
and only seven had a clinical background. It told us that it was
working to increase these numbers, but was finding it difficult
to attract senior people, who could potentially earn more in the
NHS. Monitor also confirmed, however, that nearly 30 of its staff
were paid more than £100,000 a year.[15]
15. Monitor reported that recruiting
staff from the NHS was made more difficult by issues relating
to the terms and conditions of different organisations. As Monitor
employs staff on civil service terms and conditions, people joining
from the NHS could not transfer their accrued pension rights,
and their service would not classed as continuous. This meant
that, in the event of staff being made redundant by Monitor, the
years of service they had accrued under the NHS pension scheme
would not be taken into account in calculating the amount of compensation
to which they would be entitled. The Department indicated that
similar issues had arisen in relation to the transfer of NHS staff
to local government.[16]
16. Monitor's Chief Executive, David
Bennett, had also acted as its Chair for nearly three years between
March 2011 and January 2014. Corporate governance good practice,
and Monitor's own guidance to NHS foundation trusts, is that the
same person should not be both Chair and Chief Executive. Monitor
accepted that the roles should be split to provide a check and
balance on the executive.[17]
17. The Department told us that it had
considered recruiting a new Chief Executive in March 2011, when
David Bennett took up the role of Chair. However, it had decided
to wait until the Health and Social Care Bill had been passed
and there was certainty about Monitor's role in the reformed health
system. In the meantime, it had intended that David Bennett would
carry out both roles. In 2013, the Department and David Bennett
agreed that he should remain as Chief Executive and a new Chair
should be recruited. However, in October 2013, the candidate proposed
by the Secretary of State for Health was not endorsed by the House
of Commons Health Committee. In January 2014, the Secretary of
State appointed Baroness Hanham as the interim Chair. Baroness
Hanham agreed to serve until the end of 2014, and the Department
is planning to make a permanent appointment through a competitive
process.[18]
12 Q 10; C&AG's Report Figure 2 Back
13
Written submission from Monitor Back
1 14 4
Qq 10, 37-39, 51, 105; C&AG's Report para 8, 1.8, Figure 2 Back
15
Qq 32, 36, 41; C&AG's Report, para 1.18 Back
16
Qq 41, 46-47 Back
1 17 7
Qq 88-90; C&AG's Report, paras 10, 1.14 Back
18
Qq 90-91 Back
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