Daily Insight: Treasury tackles Tower of Babel

As the pandemic rages on, HSJ readers would be forgiven if they missed a recent publication from the Treasury bearing the enticing name VAT and the Public Sector: Reform to VAT Refund Rules.

But, as anyone who flicked through the report’s 28 pages may have spotted, there are some highly significant proposals buried within.

The gist of the document is that the Treasury has lost patience with the complicated way in which VAT is refunded to public sector organisations.

VAT refunds were introduced back in the 1980s to create a level playing field between public and private sector over how certain services and goods should be provided.

Since the 80s however, the rules have gradually evolved and now resemble a process worthy of the Tower of Babel, or – in the Treasury’s words – “unduly complex, administratively burdensome, and a barrier to effective financial planning”.

This has left officials eager to simplify the rules, which – in turn – is likely to simplify the process of outsourcing.

It is at this point that the NHS should start to take an interest, because the proposed changes could significantly impact the way in which services are out or in-sourced.

Given the fact that many NHS trusts have sought to outsource or create subsidiary companies – sometimes obtaining VAT benefits as a result – this is a potential change of policy which should not be ignored.  

Next gen metrics

NHS England is a step closer to revealing what it wants to do with the new accident and emergency performance metrics.

The Department of Health and Social Care has given NHSE the green light to consult on the new metrics to replace the four hour target before December.

The consultation is among a raft of measures which was announced for winter.

DHSC also confirmed HSJ’s exclusive that the “111 First” model for A&Es will be rolled out to every trust from December.

The announcement also revealed which trusts would get a share of an extra £150m to upgrade A&E departments.