Hospitals told to end payments to personal service companies

Hospitals have been ordered to simply stop paying external managers through personal service companies.

Jim Mackay, chief executive of health service regulator NHS Improvement, reportedly issues the order in a letter he sent to hospital leaders on Tuesday.

Seen by the Times, the letter states that interims in leadership roles can be hired only if they are set clear goals and held to account for failure to achieve them.

The criteria come after Mr Mackay wrote there is sometimes either “not enough evidence of need” for such interims, or their leadership quality does not “justify” their high daily rates.

He is said to use his letter to repeat his charge that PSCs can be used as a method of avoiding tax, and calls limited company usage “deeply unpalatable” to taxpayers and NHS staff.

It was not reported whether Mr Mackay points out to the hospitals that, from April, they will become liable for deciding whether PSCs they engage are akin to employees and, if so, should have income tax and National Insurance automatically deducted from their payments.

Editor’s Note: Related –

Where the IT pay cap will keep harming the NHS

NHS quadruples its use of of-payroll appointees

What’s wrong the Budget’s PSC tax clampdown

8th December, 2016

Written by Simon Moore

Simon Moore is one of the UK’s most consistently published freelance journalists on freelancing, self-employment and contractor issues, such as IR35, the Loan Charge and late payment. Trained in News & Features writing by NCTJ-approved journalism tutors, Simon worked in the newsrooms of local, consumer and national press titles, before setting up his own editorial services company, Moore News Ltd.

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