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Unite to make ‘vigorous’ case in consultation on ‘tax avoiding’ NHS subsidiary companies

Unite the union will be making ‘a vigorous and well-argued response’ to the consultation on the future of wholly owned subsidiaries (WOSs) set up by NHS trusts and designed to avoid paying tax.

Unite, with 100,000 members in the health service, has been at the forefront of the campaign to highlight the threats that WOSs in England pose to patient services and jobs.

NHS Improvement, which oversees trusts, is now consulting on a new regulatory approach for the setting-up of WOSs. The consultation closes on 16 November and updated new guidance is expected to be issued in December.

Unite national officer for health Colenzo Jarrett-Thorpe said: “We welcome this consultation by NHS Improvement and its recent instruction to pause the creation of new wholly owned subsidiaries while this consultation is taking place.

“Unite will be making a vigorous and well-argued response to the consultation.

“We believe that plans for wholly owned subsidiaries should be abandoned as they are not the best way to maintain patient services and jobs. It is another avenue being used to privatise the NHS by stealth.

“At the very least, the case for a much tighter regulatory regime for WOSs is overwhelming. We will be consulting our members to hear their views from the frontline over the next month.”

Unite has hit back at NHS Providers, representing 227 different trusts, which said that claims of privatisation and tax avoidance were ‘misleading’.

Colenzo Jarrett-Thorpe commented: “NHS Providers’ allegation that our claims are misleading is a classic case of a pre-emptive strike before all the evidence has been gathered and analysed by NHS Improvement. It is a disruptive intervention designed to muddy the waters.”

Unite has been concerned that trusts are forming these wholly owned subsidiary companies in England so that they can register for VAT exemption and compete on a level playing field with commercial competitors who register for VAT exemption for their work in the NHS, when NHS trusts can’t.

A number of trusts have already decided to abandon plans to set up such a subsidiary.

Consultation on proposed changes to the rules governing how trusts can set up wholly owned subsidiaries (WOS) companies

Notes to editors:

For more information please contact Unite senior communications officer Shaun Noble on 020 3371 2060 or 07768 693940. Unite press office is on:  020 3371 2065/Email: shaun.noble@unitetheunion.org

Original article link: https://unitetheunion.org/news-events/news/2018/october/unite-to-make-vigorous-case-in-consultation-on-tax-avoiding-nhs-subsidiary-companies/

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