Health Warnings
Day 3 of an SR investigation

The NHS and its secrets

Kenneth Roy

The remuneration report of Orkney Health Board for 2007-08, reproduced on today's home page, is a complete disgrace. Six of the seven executive directors refused to disclose the salaries they were paid or the value of their pensions; indeed the only one who was prepared to give this information was the chief executive. Of the 10 non-executive members, public appointees of the Scottish Government, three (including the chair) refused to disclose what they were paid. To summarise: a majority of the 17 members, executive and non-executive, of this public authority, whose accounts are the responsibility of Audit Scotland, withheld information which ought to be in the public domain, and which the Treasury accepts should be in the public domain, and yet were allowed to withhold it. Furthermore, a Scottish minister approved the accounts.
     For the public record:
     Jenny Dewar, Chair (to 31 October 2007): consent to disclose withheld
     Sarah Taylor, Director of Public Health: consent to disclose withheld
     Iain White, Interim Director of Finance: consent to disclose withheld
     Peter Baxter, Interim Medical Director: consent to disclose withheld
     Fiona Smith, Director of Human Resources: consent to disclose withheld
     Rhoda Walker, Acting Director of AHP and Nursing: consent to disclose withheld
     Rosaleen Beattie, Medical Director (to 31 May 2007): consent to disclose withheld
     Kath Pye, Employee Director: consent to disclose withheld
     Jim Robertson, Non-Executive Director: consent to disclose withheld
     In all health boards, there is a remuneration committee which is responsible for agreeing the pay and benefits of executive members. It beggars belief that, of the six members of the NHS Orkney remuneration committee, three – the chair of the board Ms Dewar, Ms Pye (who represented the interests of employees) and Mr Robertson – refused to disclose details of their own payments from the board.

I wrote to Audit Scotland to seek its opinion on the NHS Orkney annual report and put two specific questions:
     Were the members of the board entitled to withhold such information?
     Did they have any duties of disclosure under the Freedom of Information Scotland Act?
     I received the following reply from Simon Ebbett:
     'Under the guidelines set out in HM Treasury's Financial Reporting Manual, it is presumed that such information would be disclosed.
However, the manual sets out specific circumstances in which this information can be withheld. It states that in such cases the fact that this has been withheld must be disclosed, as has happened in the cases you have cited...The circumstances in which the manual allows the withholding of this information are broadly in line with exemptions allowed under FoI. In terms of whether the withholding of information is justified in the cases you have cited, you would have to contact the boards themselves to ask for their reasons.'
     What, then, are the 'specific circumstances' in which the information can be withheld? I quote from the Financial Reporting Manual of HM Treasury:
     Non-disclosure is acceptable only where publication would prejudice the rights, freedom or legitimate interest of the individual; or be likely to cause substantial damage or substantial distress to the individual or another, and that damage or distress would be unwarranted.
     What are the rights, freedoms, and legitimate interests of the nine Orkney board members that would be prejudiced by publication? What is the unwarranted damage or distress that would be caused to these individuals? The questions hang in the air.
     As Audit Scotland suggested, I did contact the Orkney Health Board. I contacted it first last Friday, asking if the board considered it had a duty under the Freedom of Information Scotland Act to disclosure the salaries. No reply has been forthcoming to this request. Yesterday, prompted by Audit Scotland, I wrote directly to the chief executive David Pigott, copying him into the correspondence and requesting a formal response. As I write this on Thursday morning, he has not acknowledged my email.
     I pressed Audit Scotland further, asking specifically for its position on disclosure, and received the following email from Simon Ebbett:
     'I've been trying to get hold of the local auditor...We contract KPMG to do the audit of NHS Orkney. I will speak to him and get back to you as soon as I can. On a wider, Audit Scotland-wide basis, we would probably only have a view as an organisation if this was something that was showing up as a trend across health boards. In a localised case like this, we would leave it to the local auditor to discuss with the board and it wouldn't normally be an issue that would go into the final audit report for the year.'

I have news for Audit Scotland; news of which Audit Scotland should have been aware long before it was drawn to its attention by the Scottish Review. This is not a 'localised case'. We have now examined the annual reports of 12 of the 14 Scottish area health boards and, of these, there is refusal to disclose remuneration details in five of them, including Orkney.
     Sheila Scott, director of public health for the Western Isles, refused in the board's 2007-08 annual accounts to disclose what she earns.
     NHS Shetland does not post annual accounts on its website. It says that this would require the 'scanning of hundreds of pages'. The scanning of hundreds of pages is not a problem for the largest health board in Scotland, Greater Glasgow and Clyde, which is a model of transparency. I accepted an offer for the Shetland accounts to be transmitted electronically. They arrived yesterday afternoon. They are the recently published accounts for 2008-09, and they contain two further shocks.
     The chief executive of NHS Shetland, Sandra Laurenson, withheld consent for her salary and pension to be disclosed, as did the director of public health, Dr Sarah Taylor. Ms Laurenson, so far as I know, is the only NHS chief executive in Scotland who has refused to disclose salary.
     The second shock is that the Shetland board's medical director, Dr Ken Graham, earned between £170,000 and £180,000 in the financial year 2008-09, putting him among the highest earners across all of Scotland's health boards. Dr Graham was given a salary increase in 2008 of between £35,000 and £40,000, the largest I have been able to identify anywhere in the NHS in Scotland. His salary represents £8 a year for every man, woman and child in the Shetland Islands. But at least he has disclosed what he earns; if only the same could be said of his chief executive.
     When I put these facts to Simon Ebbett of Audit Scotland, he told me: 'On the islands there can be increased sensitivities about privacy within small and often close-knit communities. Our appointed auditors continue to work with and encourage island boards to move to more disclosure.'
     With respect to Mr Ebbett, who has been helpful and diligent in dealing with my persistent inquiries, this is a feeble explanation unworthy of a national audit body. Audit Scotland seems to be treating the island authorities as uncooperative children who have to be coaxed into doing the right thing; Mr Ebbett, in one of his emails, referred to a 'marked improvement' in Orkney's disclosure record in 2008-09 – moving away from the bottom of the class, as it were.
     What exactly is being suggested here? That more relaxed rules of financial reporting should apply to highly-paid public servants who happen to live in small, close-knit communities? Does this fall anywhere within the scope of the Treasury's get-out clauses? The suggestion is not only absurd and objectionable in principle, but unsustainable in practice. People who work for NHS Borders and NHS Highland may not be islanded, but they too live and work in small, close-knit communities – yet, so far at least, they have no difficulty about disclosing details of their salaries and pensions in the annual accounts of their boards. Indeed, outside the narrow central belt, most people in Scotland live in small, close-knit communities.
     Will NHS executives who live in cities soon be the only ones required to disclose information about themselves?

As it happens, the small and often close-knit communities theory was blown out of the water yesterday afternoon when we examined the annual accounts of NHS Ayrshire and Arran, representing such small, close-knit communities as Kilmarnock (population 44,000) and the annual accounts of NHS Forth Valley, representing the well-known islands of Stirling and Falkirk. The chief executive of Ayrshire and Arran, who earned £140,000 in the financial year 2007-08, has withheld consent to disclose any of her pension details; this section of the annual accounts is a series of blanks.
     NHS Forth Valley is worse. All seven executive directors in the report for 2007-08 withheld consent to disclose any information about their pensions. What we do know is that the magnificent seven earned between them almost £700,000 during the year in question.
     I have written again to Audit Scotland to suggest that, with almost half of the health boards whose accounts we have examined failing to disclose, there is now overwhelming evidence of what Simon Ebbett calls 'a trend' and I have invited the national audit body to declare its position. I await a response.

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