I came across something very interesting which I had missed.
On 13/4/2013 a new company comes into being called NHS Property Services Limited. The background is the abolition of the Primary Care Trusts. NHS property which is not transferred to service providers is to be transferred to the new company. It is estimated that the company will own about £5 billion worth of property comprising some 3,600 NHS facilities ranging from GP surgeries to administration buildings.
There has not been a lot of reporting of this, and it seems to me to be quite important. There is a website which is all optimistic on the surface. It explains that it has "an exciting vision to provide high quality, well maintained, modern environments"
It is not quite so upfront about other aspects. For example it is reported elsewhere that the company will charge commercial rents for the properties where that is not already the case, and that the cost gap is estimated at £500 million a year
http://www.hsj.co.uk/news/finance/nhs-prop...5053896.articleThe linked article notes that to date some premises have been available for use at less than a commercial rent, and that the PCT's were prepared to cross subsidise in some cases. Since the new company is expected to own significant assets including 30% of GP surgeries this is not trivial. Once again we see the odd spectacle of one part of the NHS paying another part .....oh wait, we don't.
The company is a true private company and one cannot help but wonder why that is. At launch it is a private company limited by shares and the article of association are available here:
http://www.property.nhs.uk/wp-content/uplo...te-Articles.pdfOnly one share has been issued and it is owned by the Secretary of State for Health. One effect of this, it seems to me, is that once the property is owned by that company any action taken in relation to it is not longer subject to democratic oversight of any kind. Certainly the Secretary of State controls it: but that is not quite the same as there being parliamentary or local accountability as is usual in public service. Which is what piqued my curiosity. So I read the articles of association and a very interesting document it is.
For example, any idea that conflict of interest will be effectively addressed is dispelled. The articles state that a director of the company can benefit from any arrangement or transaction of the company in which he has an interest, subject to general company law and to disclosure to the other directors of that interest. In particular, article 19.1.2 and 19.1.3 say that a director, notwithstanding his office
QUOTE
19.1.2 may be a director or other officer of, or employed by, or a party to any transaction or arrangement with, or otherwise interested in, any body corporate promoted by the Company or in which the Company is otherwise interested; and
19.1.3 shall not,by reason of his office, be accountable to the Company for any benefit which he derives from any such office or employment or from any such transaction or arrangement or from any interest in any such body corporate and no such transaction or arrangement shall be liable to be avoided on the ground of any such interest or benefit
Article 19.1.6 makes plain that that director can even vote on the issue he is directly concerned with, again subject to general company law and to certain provisions covered in later sections
That is quite comprehensive and it seems to say that this property owning company can, for example, sell anything it likes at any price and the buyer can be a company which employs or is owned by one or more of the directors. And he can vote on whether they should do that
I might be wrong: but that interpretation seems to be reinforced by Article 20, which says
QUOTE
The directors may authorise, to the fullest extent permitted by law, any matter proposed to them which would otherwise result in a director infringing his duty under S 175 of the Act to avoid a situation in which he has,or can have, a direct or indirect interest that conflicts, or possibly may conflict, with the interests of the Company and which may reasonably be regarded as likely to give rise to a conflict of interest
The Articles also state that anybody who is willing can be a director if he is permitted by law to do so: so I volunteer! Except that in practice the only people who can make me a director are the directors: and I am not one of their pals
It is a pity, cos this is a great job: you set your own wages, if you are a director.It says so at Article 32
QUOTE
Directors are entitled to such remuneration as the directors determine
Also that remuneration can take any form and they can claim expenses too: though the latter is limited to what is "reasonable", so that is something of a constraint: however small
Does that look like the sort of company we should be handing our public assets to? It doesn't to me. Especially since it is also in the Articles that the Company can issue new shares of any type whenever it likes: so they can effectively sell the whole shebang if and when they want to
It is entirely possible that this is the standard for articles of association for this kind of company: I wouldn't know. If it is it is quite shocking anyway. But this is not an ordinary company: it owns a great part of our NHS. And it seems to me to pave the way for privatisation proper. Again.
