Treasury say's no and bans tax dodge by NHS trusts to stave off cash crisis

It was announced on Wednesday 1st February 2006, the Treasury has finally outlawed a financial dodge that scores of NHS trusts were planning to use to avoid a cash crisis before the end of the financial year in March. A quarter of all NHS hospitals and primary care trusts said they were intending to withhold tax and national insurance contributions, according to a poll of trust chief executives for Health Service Journal last month.
 

By delaying payments in March to Revenue & Customs until April, their senior executives thought they could eliminate expenditure worth tens of millions of pounds from the 2005-06 balance sheet. This would have reduced the NHS's forecast net deficit of £623m and would have helped trusts that are running into an acute cashflow problem.

Locally, this means many of the struggling Health Trusts in the eastern region will now have a much larger short term shortfall of cash at the end of this financial year than was originally forecast or planned.