Sixteen local authorities failed to pass on hundreds of thousands of pounds specifically allocated by central government to fund NHS complaints advocacy services, HSJ can reveal.
One council had retained 79 per cent of the money it received.
According to data collected by Healthwatch England under the Freedom of Information Act, shared exclusively with HSJ, 13 councils failed to hand on more than £50,000 each to their advocacy provider and three failed to pass on more than £100,000.
Collectively, councils were awarded £14.2m a year through the local reform and community voices grant to fund independent NHS complaints advocacy services, which help patients and families navigate a complex complaints system. Local Healthwatch provide these services in some areas.
Healthwatch England asked every council how much of this money it spent in 2013-14 and how much was allocated for the service in 2014-15.
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In total, 115 provided figures for spending in 2013-14 and 110 responded with their allocations for 2014-15.
Overall, the 115 councils that responded with figures for 2013-14 received more than £11m to fund the services but only spent £9.5m. This meant that about £1.5m, or 14 per cent, of the allocated funding did not reach the frontline.
In 2014-15, the 110 councils that responded received £10m to fund the service but only spent £8.5m. This meant that almost £1.6m (16 per cent) of the funding did not reach the frontline.
Suffolk, Kent and Hampshire county councils had the largest discrepancies, amounting to more than a £100,000 gap each between the money they received and the money they spent on NHS complaints advocacy - in both years in Suffolk and Kent, and in 2013-14 in Hampshire.
In both years Suffolk did not pass on £152,852 of the £192,852 it received, meaning 79 per cent of the funding did not go on the services it was intended for.
A Suffolk County Council spokesman said it was “committed” to ensuring anyone who needed independent advocacy support was able to access the service.
He added: “The figures quoted by Healthwatch England refer to the first year that the service was commissioned by Suffolk County Council and more funding was available if it had been needed.
“The volume of NHS complaints advocacy has risen since then and there is no evidence that people are not able to access the service they require.”
Kent kept £127,902 in both years even though it received £364,514 under the grant – withholding over a third of the funding.
A spokeswoman for the council said: “Along with several other southern local authorities, we went out to tender for a two year contract for a health complaints advocacy service.
“The contract was won by SEAP and Kent’s portion of the price is £236,600.
“This year, of the £364,600 Department of Health grant for the service, a further £10,000 was allocated for citizen engagement and development of advocacy services as part of Care Act compliance along with £7,600 for administrative costs.
“The remaining £109,800 from the grant is not ringfenced and will be included in the overall council outturn.”
In 2013-14 Hampshire retained 40 per cent of the funding by not allocating £112,642 of the £281,142 it received.
However, it increased the amount it allocated to complaints advocacy services the following year, with the amount withheld dropping to £74,142.
Hampshire was approached for comment but had not responded before HSJ published this story.
A further 13 councils did not pass on at least £50,000 of the money to their advocacy provider in at least one of the two years.
These were Liverpool, Manchester, Hertfordshire, Lincolnshire, Birmingham, Northamptonshire, Surrey, Wigan, Newcastle upon Tyne, Sunderland, Leicestershire, Oxfordshire and Wirral.
Katherine Rake, chief executive of Healthwatch England, urged councils to rethink the amount they spent on complaints advocacy.
She said as many as 250,000 incidents of poor care could go unreported every year due to the “complexities of the complaints system and the level of fear amongst patients”.
Two-thirds of patients Healthwatch surveyed who had a bad experience but did not report it said they would be more likely to in future if they were offered support, she said.
Ms Rake said: “Considering the relatively modest amounts being invested in complaints support nation-wide, Healthwatch England is calling on commissioners to ensure they fully consider the resourcing necessary for a well publicised and easy to use complaints support service.”