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Top NHS finance chief was paid ‘off payroll’

NHS Professionals paid two executives more than £500,000 each over three years

By Alison Winward | 27 March 2012

Top NHS finance chief was paid ‘off payroll’One NHS finance director was paid more than half a million pounds through a personal-service company rather than via the staff payroll, Exaro can reveal.

Robert Clarke was paid at least £534,000 over three years as director of finance at NHS Professionals, which supplies temporary workers to the UK health service. He was paid through his personal company, Healthy Figures.

He was initially appointed to the position as an “interim” in August 2008. He remained in post – but ‘off payroll’ – until last October, when he joined the staff as a salaried employee.

Meanwhile, a former chief executive of NHS Professionals, Neil Lloyd, was paid at least £631,000 as a consultant over three years until he left last April.

The disclosures come as Whitehall conducts a review into senior public officials’ contracts after an Exaro investigation, in conjunction with BBC2’s Newsnight, eight weeks ago revealed how the Student Loans Company was paying its chief executive, Ed Lester, through his personal-service company under concessions granted by HM Revenue & Customs.

People employed through a personal company can avoid having to pay income tax and national insurance at source through the ‘pay as you earn’ (PAYE) system.

They are able to reduce their tax burden by instead paying corporation tax – at a lower level.

Annual accounts for NHS Professionals – which provides nursing, medical and administrative staff to fill temporary gaps at NHS trusts – show that it paid between £130,000 and £135,000 in the 2008-09 financial year. The payment for Clarke’s services went to an “external organisation”.

Filings at Companies House record that he became a director and company secretary of NHS Professionals in February 2009.

The accounts for that year include a declaration that Clarke is also a director and owner of Healthy Figures. Companies House records show that Healthy Figures was incorporated the day after Clarke began work at NHS Professionals.

Accounts for NHS Professionals for 2009-10 show that it again paid for Clarke’s services through an “external organisation”. It paid between £200,000 and £205,000, and “other remuneration” of between £5,000 and £10,000, for that period.

And 2010-11 accounts show that it paid £204,000, plus £10,000 business expenses, for Clarke’s services. It added: “The director of finance, Robert Clarke, is paid by a limited company, which is 100 per cent owned by him.”

The accounts also show that Lloyd, chief executive of NHS Professionals between November 2008 and April 2011, was paid ‘off payroll’.

The 2010-11 accounts say that Lloyd “was paid for his services on a consultancy basis,” although it includes no reference to a personal-service company. Accounts show that he received at least £631,000, excluding VAT, during three financial years.

The Department of Health, under the then Labour government, set up NHS Professionals to manage the supply – and reduce the cost – of temporary staff to local NHS organisations nationwide. It began operations in 2004, and was initially a special health authority.

In 2010, NHS Professionals was dissolved and restructured as a company wholly owned by the health secretary. The Department of Health announced last April that it was seeking a buyer for the company.

A spokeswoman for NHS Professionals said that it was “uncomfortable” about answering specific questions about Clarke’s arrangements because it was worried about being “smeared”. She confirmed that Clarke did not go on to the payroll until last October.

“What you are talking about is a time of big transition,” she said.

“There are very good reasons why there are one or two short-term contracts. People were brought in on the senior management team to turn the company around from a deficit of £40 to £50 million to the company now being effectively no longer a burden on the taxpayer.”

“In the greater scheme of things, if one member of a team had paid slightly less tax, but the taxpayer was £50 million better off over a twelve-month period, you might see where the better investment is.”

Exaro revealed last week that 3,000 people working for the BBC are paid through personal-service companies. Five BBC people earn more than £150,000 a year from the broadcaster without having tax deducted at source.

That revelation came after the chancellor, George Osborne, announced in his budget last Wednesday a crackdown on this use of personal-service companies to avoid tax.

Additional reporting by Alex Varley-Winter.

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Exaro News investigates matters of public interest and seeks to uncover the truth.