Barts Charity becomes first NHS charity to spin out from Department of Health control

The charity, which raises funds for the Barts Health NHS Trust, receives an independence order from the DoH, releasing it from the provisions of the National Health Service Act 2006

Barts Charity
Barts Charity

Barts Charity, which raises funds for the London-based Barts Health NHS Trust, has become the first charity to take advantage of new rules that allow NHS charities to operate away from NHS legislation and become independent from the Secretary of State for Health.

After a public consultation, the Department of Health said in March that requiring NHS charities to abide by both the National Health Service Act 2006 and Charity Commission rules was unnecessarily burdensome.

It said it would develop guidance for charities that wanted to spin out from NHS bodies and a template memorandum of understanding that could be agreed between charities and the NHS.

Yesterday, Barts Charity became the first charity to receive an independence order from the DoH, releasing it from the provisions of the act.

The charity, which had an income of £12.6m in 2012/13, will now have the ability to appoint its own trustees independently – rather than having them appointed by the Secretary of State for Health – and will be regulated exclusively by the Charity Commission.

Andrew Douglas, chief executive of Barts Charity, said that the charity first started working towards independence six years ago. Over that period, it set up a limited liability company and hired two members of staff who had previously been employed by the NHS.

He said this meant that by the time the DoH announced a mandate in May permitting NHS charities to apply to be released from the provisions of the act, the charity was able to move quickly.

"It’s a big change and it means that a large charity is truly independent – it’s the first in the NHS sector to achieve that," said Douglas. "It definitely removes a lot of bureaucratic burden, but most importantly it has allowed the trustees to be independent about how its assets are used for the right thing and the right place."

Douglas said that a memorandum of understanding had been agreed between Barts Charity and Barts Health NHS Trust, saying that the trust would ensure that all charitable funding the hospital received would go to the charity.

Jonathan Brinsden, a partner at the law firm Bircham Dyson Bell, which advised on the move, said in a statement that the new structure would place Barts Charity on a level playing field with other health charities that had never been subject to the operational restrictions of the NHS statutory framework. This would enable better engagement with supporters and stakeholders, he said.

The decision to allow NHS charities to become independent came after a public consultation by the DoH that closed in January 2013. The DoH document Review of the Regulation and Governance of NHS Charities argued that, by establishing new independent charities, NHS trust charities would have greater freedom and would be able to operate more flexibly, while retaining their relationship with NHS bodies.

A spokeswoman for the Charity Commission said: "Independence is an essential part of the character of charities and, where NHS charities choose to convert to charities independent of their linked NHS Trust, we are happy to facilitate the process, as we did with Barts Charity. It is a decision for the trustees as to whether they convert, and we welcome NHS charities having this option."

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