National Health Service Act 1977

Finance and AccountsE+W+S

[F197 Means of meeting expenditure of Health Authorities and Special Health Authorities out of public funds.E+W+S

[F2(1)It is the duty of the Secretary of State to pay to each Health Authority sums equal to their general Part II expenditure.

[F3(2)“General Part II expenditure” is expenditure which—

(a)is attributable to the payment of remuneration to persons providing services in pursuance of Part II; but

(b)does not fall within paragraphs (b) to (d) of subsection (3A).]

(3)It is the duty of the Secretary of State to pay to each Health Authority, in respect of each financial year, sums not exceeding the amount allotted for that year by the Secretary of State to the Authority towards meeting their main expenditure [F4in that year].

[F5(3BB)Schedule 12A to this Act (which defines “general Part II expenditure” and “main expenditure” for the purposes of, and supplements, this section and section 97C below) shall have effect]]

[F6(3C)Where the Secretary of State has made an initial determination of the amount (“the initial amount”) to be allotted for any year to a Health Authority under subsection (3) above, he may, if it appears to him that the authority satisfied in any preceding year any objectives notified as objectives to be met by Health Authorities for the purposes of this subsection in performing their functions, increase the initial amount by a further sum.

(3D)In subsection (3C) above, “notified” means specified or referred to in a notice given to Health Authorities by the Secretary of State.

(3E)In making any increase under subsection (3C) above, the Secretary of State may (whether by directions under subsection (6) below or otherwise) impose any conditions he thinks fit on the application or retention by the authority of the sum in question.

(3F)Where the Secretary of State has, under subsection (3C) above, increased by any sum the amount to be allotted for any year to a Health Authority and notified the authority of the allotment and it subsequently appears to him that the authority have failed (wholly or in part) to satisfy any conditions imposed in making that increase, he may—

(a)reduce the allotment made to that authority for that year, or

(b)when he has made an initial determination of the amount (“the initial amount”) to be allotted for any subsequent year to the authority under subsection (3) above, reduce the initial amount,

by an amount not exceeding that sum.]

(4)It is the duty of the Secretary of State to pay in respect of each financial year to each Special Health Authority sums not exceeding the amount allotted for that year by the Secretary of State to the Special Health Authority towards meeting the expenditure of the Special Health Authority which is attributable to the performance by the Special Health Authority of their functions in that year.

(5)An amount is allotted to a Health Authority or Special Health Authority for a year under this section when they are notified by the Secretary of State that it is allotted to them for that year; and the Secretary of State may make an allotment under this section increasing or reducing an allotment previously so made.

(6)The Secretary of State may give directions to a Health Authority or Special Health Authority with respect to—

(a)the application of sums paid to them under [F7this section];

(b)the payment of sums by them to the Secretary of State in respect of charges or other sums referable to the valuation or disposal of assets; [F8or]

[F9(bb)the application of sums received by them under section 97C(4) below; or]

(c)the application by them of sums received by them by virtue of section 15(7)(a) of the M1National Health Service and Community Care Act 1990.

F10(7). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(8)Where an order establishing a Special Health Authority provides for any expenditure of the Special Health Authority to be met by a Health Authority or by two or more Health Authorities in portions determined by or in accordance with the order, it is the duty of the Health Authority, or each of the Health Authorities, to pay to the Special Health Authority sums equal to, or to the appropriate portion of, that expenditure.

(9)Sums falling to be paid [F11to Health Authorities or Special Health Authorities] under this section shall be payable subject to compliance with such conditions as to records, certificates or otherwise as the Secretary of State may determine.]

[F1297A Financial duties of Health Authorities and Special Health Authorities.E+W+S

(1)It is the duty of every Health Authority, in respect of each financial year, to perform their functions so as to secure that the expenditure of the Health Authority which is attributable to the performance by them of their functions in that year (not including expenditure within subsection (1) of section 97 above) does not exceed the aggregate of—

(a)the [F13amount allotted to them for that year under subsection (3)]of that section;

(b)any sums received by them in that year under any provision of this Act (other than sums received by them under that section); and

(c)any sums received by them in that year otherwise than under this Act for the purpose of enabling them to defray any such expenditure.

(2)It is the duty of every Special Health Authority, in respect of each financial year, to perform their functions so as to secure that the expenditure of the Special Health Authority which is attributable to the performance by them of their functions in that year does not exceed the aggregate of—

(a)the amount allotted to them for that year under subsection (4) of section 97 above;

(b)any sums received by them in that year under any provision of this Act (other than sums received by them under that subsection); and

(c)any sums received by them in that year otherwise than under this Act for the purpose of enabling them to defray any such expenditure.

(3)The Secretary of State may give such directions to a Health Authority or Special Health Authority as appear to be requisite to secure that the Health Authority or Special Health Authority comply with the duty imposed on them by subsection (1) or (2) above.

(4)Directions under subsection (3) above may be specific in character.

F14(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(6)To the extent to which—

(a)any expenditure is defrayed by a Health Authority or Special Health Authority as trustee or on behalf of a Health Authority or Special Health Authority by special trustees; or

(b)any sums are received by a Health Authority or Special Health Authority as trustee or under section 96A above,

that expenditure and, subject to subsection (8) below, those sums shall be disregarded for the purposes of this section.

(7)For the purposes of this section sums which, in the hands of a Health Authority or Special Health Authority, cease to be trust funds and become applicable by the Health Authority or Special Health Authority otherwise than as trustee shall be treated, on their becoming so applicable, as having been received by the Health Authority or Special Health Authority otherwise than as trustee.

(8)Of the sums received by a Health Authority or Special Health Authority under section 96A above so much only as accrues to the Health Authority or Special Health Authority after defraying any expenses incurred in obtaining them shall be disregarded under subsection (6) above.

(9)Subject to subsection (6) above, the Secretary of State may by directions determine—

(a)whether sums of a description specified in the directions are, or are not, to be treated for the purposes of this section as received under this Act by a Health Authority or Special Health Authority of a description specified in the directions;

(b)whether expenditure of a description specified in the directions is, or is not, to be treated for those purposes as—

(i)expenditure within subsection (1) above of a Health Authority of a description so specified; or

(ii)expenditure within subsection (2) above of a Special Health Authority of a description so specified; or

(c)the extent to which, and the circumstances in which, sums received—

(i)by a Health Authority under F15. . . section 97 above; or

(ii)by a Special Health Authority under subsection (4) of that section,

but not yet spent are to be treated for the purposes of this section as part of the expenditure of the Health Authority or Special Health Authority and to which financial year’s expenditure they are to be attributed.]

[F1697AA Resource limits for Health Authorities and Special Health Authorities.E+W+S

(1)It is the duty of every Health Authority and every Special Health Authority to ensure that the use of their resources in a financial year does not exceed the amount specified for them in relation to that year by the Secretary of State.

(2)In the application of subsection (1) above to a Health Authority no account shall be taken of any use of resources for the purpose of general Part II expenditure (within the meaning of paragraph 1 of Schedule 12A).

(3)For the purpose of subsection (1) above the Secretary of State may give directions—

(a)specifying uses of resources which are to be, or not to be, taken into account;

(b)making provision for determining to which Health Authority or Special Health Authority certain uses of resources are to be attributed;

(c)specifying descriptions of resources which are to be, or not to be, taken into account.

(4)Subsections (6) to (8) of section 97A above shall apply in relation to the duty under subsection (1) above as they apply in relation to the duties under section 97A(1) and (2); and for that purpose references to the defraying of expenditure and the receipt of sums shall be construed as references to the incurring of liabilities and the acquisition of assets.

(5)The provisions in section 97A(3) and (4) above about the giving of directions by the Secretary of State shall apply in relation to the duty under subsection (1) above as they apply in relation to the duties under section 97A(1) and (2).

(6)Where the Secretary of State has specified an amount under this section in respect of a financial year, he may vary the amount by a later specification.

(7)In this section a reference to the use of resources is a reference to their expenditure, consumption or reduction in value.]

F1797B. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .E+W+S

[F1897C Public funding of Primary Care Trusts.E+W+S

(1)It is the duty of every Health Authority, in respect of each financial year, to pay to each Primary Care Trust whose area falls within their area—

(a)sums equal to the trust’s general Part II expenditure, and

(b)sums not exceeding the amount allotted by the authority to the trust for that year towards meeting the trust’s main expenditure in that year.

(2)Any payment under subsection (1)(a) above shall be made out of money paid to the Health Authority under subsection (1) of section 97 above and any payment under subsection (1)(b) above shall be made out of money paid to the authority under subsection (3) of that section.

(3)An amount is allotted to a Primary Care Trust for a year under this section when the trust is notified by the Health Authority that the amount is allotted to it for that year; and the Health Authority may make an allotment under this section increasing or reducing an allotment previously so made.

(4)The Secretary of State may give directions to a Primary Care Trust about the payment of sums by the trust to the Health Authority in whose area the area of the trust falls in respect of charges or other sums referable to the valuation or disposal of assets.

(5)Where any part of a sum paid to a Primary Care Trust by a Health Authority under subsection (1) above derives from a sum which was paid to the authority under subsection (1) or (3) of section 97 above subject to a direction (under subsection (6)(a) of that section) that it be applied for a particular purpose, the authority shall direct the trust that the sum paid to the trust shall be applied for the same purpose.

[F19(5A)If the Secretary of State considers it appropriate to do so, he may make a supplementary payment to a Primary Care Trust, which may be subject to such conditions as he thinks fit to impose, including conditions as to repayment.]

(6)Sums falling to be paid to Primary Care Trusts under this section shall be payable subject to compliance with such conditions as to records, certificates or otherwise as the Secretary of State may determine.]

F2097D Financial duties of Primary Care Trusts.E+W+S

(1)It is the duty of every Primary Care Trust, in respect of each financial year, to perform its functions so as to secure that the expenditure of the trust which is attributable to the performance by the trust of its functions in that year (not including expenditure within subsection (1)(a) of section 97C above) does not exceed the aggregate of—

(a)the amount allotted to it for that year under subsection (1)(b) of that section,

(b)any sums received by it in that year under any provision of this Act (other than sums received by it under that section [F21, apart from subsection (5A)]), and

(c)any sums received by it in that year otherwise than under this Act for the purpose of enabling it to defray any such expenditure.

(2)The Secretary of State may give such directions to a Primary Care Trust as appear to be requisite to secure that the trust complies with the duty imposed on it by subsection (1) above.

(3)Directions under subsection (2) above may be specific in character.

(4)To the extent to which—

(a)any expenditure is defrayed by a Primary Care Trust as trustee or on behalf of a Primary Care Trust by special trustees, or

(b)any sums are received by a Primary Care Trust as trustee or under section 96A above,

that expenditure and, subject to subsection (6) below, those sums shall be disregarded for the purposes of this section.

(5)For the purposes of this section sums which, in the hands of a Primary Care Trust, cease to be trust funds and become applicable by the Primary Care Trust otherwise than as trustee shall be treated, on their becoming so applicable, as having been received by the Primary Care Trust otherwise than as trustee.

(6)Of the sums received by a Primary Care Trust under section 96A above so much only as accrues to the Primary Care Trust after defraying any expenses incurred in obtaining them shall be disregarded under subsection (4) above.

(7)Subject to subsection (4) above, the Secretary of State may by directions determine—

(a)whether specified sums are, or are not, to be treated for the purposes of this section as received under this Act by a specified Primary Care Trust,

(b)whether specified expenditure is, or is not, to be treated for those purposes as expenditure within subsection (1) above of a specified Primary Care Trust, or

(c)the extent to which, and the circumstances in which, sums received by a Primary Care Trust under section 97C above but not yet spent are to be treated for the purposes of this section as part of the expenditure of the Primary Care Trust and to which financial year’s expenditure they are to be attributed.

(8)In subsection (7) above, “specified” means of a description specified in the directions.

[F2297E Resource limits for Primary Care Trusts.E+W+S

(1)It is the duty of every Primary Care Trust to ensure that the use of their resources in a financial year does not exceed the amount specified for them in relation to that year by the Health Authority for the trust’s area.

(2)For the purpose of subsection (1) above no account shall be taken of any use of resources for the purpose of a trust’s general Part II expenditure (within the meaning of paragraph 4 of Schedule 12A).

(3)For the purpose of subsection (1) above the Secretary of State may give directions—

(a)specifying uses of resources which are to be, or not to be, taken into account;

(b)making provision for determining to which Primary Care Trust certain uses of resources are to be attributed;

(c)specifying descriptions of resources which are to be, or not to be, taken into account.

(4)Where an amount has been specified under this section in respect of a financial year, it may be varied by a later specification.

(5)Subsections (4) to (6) of section 97D above shall apply in relation to the duty under subsection (1) above as they apply in relation to the duty under section 97D(1); and for that purpose references to the defraying of expenditure and the receipt of sums shall be construed as references to the incurring of liabilities and the acquisition of assets.

(6)The provisions in section 97D(2) and (3) above about the giving of directions by the Secretary of State shall apply in relation to the duty under subsection (1) above as they apply in relation to the duty under section 97D(1).

(7)In this section a reference to the use of resources is a reference to their expenditure, consumption or reduction in value.]

98 Accounts and audit.E+W+S

(1)Accounts, in such form as the Secretary of State may with the approval of the Treasury direct, shall be kept by—

[F24(a)every Health Authority;

(b)every Special Health Authority;

[F25(bb)every Primary Care Trust]

(c)every NHS trust;]

(d)all special trustees appointed in pursuance of section 29(1) of the National Health Service Reorganisation Act 1973 and section 95(1) above;

[F26(dd)any trustees for an NHS trust appointed in pursuance of section 11 of the National Health Service and Community Care Act 1990]

[F27(ddd)any trustees for a Primary Care Trust appointed in pursuance of section 96B above; and]

(e)the Dental Estimates Board

Those accounts shall be audited by auditors [F28appointed by the Audit Commission for Local Authorities and the National Health Service in England and Wales and the Comptroller] and Auditor General may examine all such accounts and any records relating to them, and any report of the auditor on them.

(2)Every such body shall prepare and transmit to the Secretary of State in respect of each financial year annual accounts in such form as the Secretary of State may with the approval of the Treasury direct.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F29

[F30(2AA)Every Primary Care Trust shall send a copy of any accounts it has prepared under subsection (2) above to the Health Authority within whose area the trust’s area falls.]

[F31(2A)The accounts prepared and transmitted by a [F32Health Authority] in pursuance of subsection (2) above shall include annual accounts of a Community Health Council if—

(a)the Council is established for the [F33Health Authority’s area]; or

(b)the [F34Health Authority is prescribed for the purposes of this subsection] in relation to the Council.]

[F35X1(2B)in preparing its annual accounts in pursuance of subsection (2) above, and NHS trust shall comply with any directions given by the Secretary of State with the approval of the Treasury as to—

(a)the methods and principles according to which the accounts are to be prepared; and

(b)the information to be given in the accounts.]

[[F36F37X1(2B)So far as relates to allotted sums paid [F38under section 15 of the M2National Health Service and Community Care Act 1990] to the members of a fund-holding practice—

(a)accounts shall be kept in such form as the Secretary of State may with the approval of the Treasury direct;

(b)the Comptroller and Auditor General may examine the accounts and records relating to them and any report of the auditor on them;

(c)in respect of each financial year, annual accounts in such form as the Secretary of State may with the approval of the Treasury direct shall be prepared and submitted to the relevant [F39Health Authority]; and

(d)in respect of each financial year, each [F39Health Authority] shall prepare in such form as the Secretary of State may with the approval of the Treasury direct, and include in its own accounts, a summarised version of the accounts submitted to [F40the Health Authority] under paragraph (c) above.]]

(3). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F41

(4)The Secretary of State shall prepare in respect of each financial year—

(a)in such form as the Treasury may direct, summarised accounts of [F42the bodies mentioned in subsection (1) above, other than the Dental Estimates Board]

(b)in such form and containing such information as the Treasury may direct, a statment of the accounts of the Dental Estimates Board;

and shall transmit them on or before 30th November in each year to the Comptroller and Auditor General, who shall examine and certify them, and lay copies of them together with his report on them before both Houses of Parliament.

F43(5). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

99 Regulation of financial arrangements.E+W+S

(1)The Secretary of State may by regulations provide, in the case of all or any of the following bodies—

[F44(a)Health Authorities,

(b)Special Health Authorities,]

[F45(ba)Primary Care Trusts]

(e)Community Health Councils, and

(f)the Dental Estimates Board,

for restricting the making of payments by or on behalf of the body otherwise than on such authorisation and subject to such conditions as may be specified in the regulations.

(2)Such provision may be made subject to such exceptions as may be so specified, and those regulations may contain such other provisions as to the making and carrying out by all or any of those bodies of such arrangements with respect to financial matters as the Secretary of State thinks necessary for the purpose of securing that the affairs of such bodies are conducted, so far as reasonably practicable, in such manner as to prevent financial loss and to ensure and maintain efficiency.

(3)The Secretary of State may give directions to any of those bodies as to any matter with respect to which those regulations may be made; and those directions may be specific in character and shall be—

(a)such as appear to him requisite to secure that the affairs of the body are conducted in such a manner as is mentioned in subsection (2) above,

(b)without prejudice to the operation of any such regulation,

F46. . ..

100 Other Payments.E+W+S

(1)There shall be paid out of moneys provided by Parliament such expenses incurred by—

(a). . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F47

(b)any standing advisory committee constituted under section 6 above,

(c)the Medical Practices Committee,

(d)the Tribunal constituted under section 46 above, and

(e)the Dental Estimates Board,

as may be determined by the Secretary of State with the approval of the Treasury.

(2)Payments made under this section shall be . . . F48 made at such times and in such manner as the Treasury may direct, and subject to such conditions as to records, certificates, or otherwise as the Secretary of State may with the approval of the Treasury determine.

101 Secretary of State’s receipts.E+W+S

Any sums received by the Secretary of State under this Act shall be paid into the Consolidated Fund, . . . F49