An international accountancy standard, inspired by the European Union and implemented by Labour – itself international standard of theft and asset stripping – is set to hit the NHS.
The impact is set out in a document released by a North London NHS Trust to the Staff Side on International Financing Reporting Standards. These EU standards will change the accountancy base of the NHS by moving Private Finance Initiative schemes onto the balance sheet (currently they are off-balance sheet).
The fixed assets of the Trust (and all other NHS Trusts) are to be re-valued as a Modern Equivalent Asset, defined as “the market value of the assets based on the assumption that they are sold as part of a continuing operation”.
No one knows what this means, though the Trust estimates it may lead to an “impairment” which would cost it £3.8 million, even though the Department of Health has advised such impairments can be excluded from the Trust’s financial break-even duty. Other NHS Trusts will be similarly affected.
Annual leave carried over by staff is also identified as a potential cost to the Trust as it is a “benefit”. Hence great pressure will be brought to bear on staff either to take their leave during the leave year or lose it – a smash and grab proposal from the Trust. The value of leave to staff, if paid time, is around £1 million
What is really being introduced here is the recategorisation of NHS assets, estates and functioning – a sleight of hand by redefining accountancy rules, regulations and standards. It’s been done before. During the major privatisations of gas, electricity, water and coal in the 1980s and 1990s fixed assets were effectively wiped out and written off so that privatisations could assume an asset base of zero.