• Royal Liverpool and Broadgreen University Hospitals Trust made three sets of additional payments to non-executives that were not approved by health secretary
  • Two NEDs refused to repay the money and will not be pursued by the trust
  • NHS Improvement accepts concerns over “continuity of oversight”

Two former non-executive directors will not be pursued by the trust to return unauthorised payments that were made to them, HSJ has learned.

The Royal Liverpool and Broadgreen University Hospitals Trust made three sets of additional payments to non-executives between April 2009 and August 2014, none of which were approved by the health secretary.

Royal Liverpool and Broadgreen University Hospitals NHS Trust

Royal Liverpool University Hospital

Four people have returned payments but two have so far refused

An independent report last year revealed how the trust had ignored its own legal advice by making extra payments, which ranged between £3,000 and £20,000.

The unauthorised payments were made for significant amounts of extra work. There are restrictions on trusts regarding non-executive pay, which mean they need the health secretary’s permission to exceed agreed levels.

The former chair and three former non-executives have returned the money paid to them, but two former directors have refused. The trust considered whether to pursue repayment through the courts.

NHS Improvement and the National Audit Office have also looked into the issue, following complaints from local politicians, but correspondence seen by HSJ suggests the former directors will not be pursued.

A letter from NHS Improvement chief executive Jim Mackey to an interested party said: “The trust has pursued informal channels to recover these funds but we have to be realistic that the prospect of recovering the remaining funds is now low.

“The trust has sought advice on commencing legal proceedings to recover the funds. It has been advised, that this approach would be costly and would not guarantee a positive outcome given the circumstances under which the payments were originally made.

“As a consequence, I will not be asking the trust to pursue this option… Informal efforts have taken place by the trust and the option still remains open for the two individuals involved to do the right thing and repay the funds.”

HSJ was also shown a letter from the NAO to NHS Improvement, which raised concerns over the “continuity of oversight” in the period when NHS Improvement was being established.

This led to “inconsistent responses” from the regulator and the trust, relating to whether repayment was being pursued, and a lack of clarity over a review of the trust chief executive’s salary.

The NAO letter said: “The kind of issues that arose at the Royal Liverpool and Broadgreen trust are a direct risk to public confidence in the system.

“We recognise that these arose from actions taken by the trust and that the trust failed to secure the necessary external approval.

“However, in respect of follow up action, I hope you agree that NHS Improvement and its predecessor bodies must be able to show that their oversight and intervention mechanisms are working effectively.”

Mr Mackey’s letter also referenced these concerns and he said he “wholly accepts” the points raised.