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NHS Tayside report shows 'number of financial weaknesses'

Health board says a number of changes have already been made by its new leadership team.

Ninewells Hospital: Health board under scrutiny.
Ninewells Hospital: Health board under scrutiny.

An independent review has identified a "number of weaknesses" in NHS Tayside's financial management arrangements.

The report by accountants Grant Thornton, found a lack of "open and transparent governance" in the financial management of a health board which used endowment funds to cover general running costs.

Commissioned by the Scottish government, the report makes a number of recommendations including that the health board's finance department should review how it forecasts the likely future financial position.

The board agreed to use £3.6m from its endowment fund, which is made up of donations from the public or bequests in wills, to help it break even in 2013/14.

The revelations in April prompted the resignation of NHS Tayside chairman Professor John Connell, with the Greater Glasgow health board boss John Brown now employed on an interim basis.

The Grant Thornton review also said the decision-making process concerning the £3.6m use of endowment funds was "not subject to fully open and transparent governance processes".

The report added: "In the case of the decision to retrospectively apply endowment money of £3.6m, we have evidenced examples within NHS Tayside where the anticipated financial controls, particularly across management; scrutiny; and assurance were either not in place or did not operate as effectively as intended."

Health secretary Shona Robison said: "This report highlights the historic poor financial governance and management practice within NHS Tayside.

"It also highlights the decision-making process related to the retrospective use of endowment funds was not subject to fully open and transparent governance processes and that these issues were not raised or discussed with the Scottish Government.

"All the recommendations in the report have been accepted in full and progress is already being made towards them."

NHS Tayside said its new leadership team have already implemented a number of reviews and improvements in their first weeks.

Chief executive Malcolm Wright said: "Today's report is very unsatisfactory for NHS Tayside in a number of areas, but the lack of open and transparent governance processes regarding financial management shown over the years is extremely serious.

"This independent review reinforces our position of transparency first and we will now relentlessly pursue improvements to our financial reporting and governance to ensure all recommendations are implemented."

NHS Tayside has said it will refund the money from its endowment fund.

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