What is an NHS Charity?
For the purposes of the Charity Commission, as well as for the International Accounting Standard 27 (in the context of consolidation of accounts), an ‘NHS charity' is one:
- which holds assets on statutory trusts set out in the NHS Act 2006;
- in respect of which the Secretary of State for Health has the power to appoint trustees; and to transfer property from one NHS related trustee to another; but does not have the power (without primary legislation) to alter the trusts applicable to the assets; and
-
whose trusts are regarded as exclusively charitable and for the public benefit, and therefore which qualifies for registration with the Charity Commission. The Charity Commission is consequently the principal regulator for the administration, reporting and supervision of NHS charities.
Objects
On the creation of the National Health Service in 1946, the original trusts of charitable endowments associated with hospitals which were to become part of the NHS were lifted, and the NHS Act 1946 provided that these assets were to be held ‘for purposes relating to hospital services (including research), or to any other part of the health service associated with any hospital.'
The statutory trusts applicable to NHS charities derive from this event. The wording now appears in s 220 NHS Act 2006 - ‘[subject to a requirement to procure that the original purposes of the endowment are adhered to], the property must be held on trust for such purposes relating to hospital services (including research), or to any other part of the health service associated with any hospital, as the person holding the property considers appropriate'. Such wording is sometimes replicated very closely in the objects clause of an NHS charity; or the clause may simply refer to s220 (or its predecessor, s 93 NHS Act 1977).
Beneficiaries
In interpreting the objects of NHS charities, reference must be made to NHS legislation as to the meaning of ‘health service' (i.e. the NHS); the purpose of the NHS; and the meaning of ‘hospital services'.
The statutory purpose of the NHS is to ‘secure improvement (a) in the physical and mental health of the people of England, and (b) in the prevention, diagnosis and treatment of illness'.
The beneficiaries of NHS charities are therefore the ‘people of England' (i.e. rather than the NHS hospitals / NHS Trusts / NHS Foundation Trusts).
Legal form
All NHS charities are charitable trusts, and so do not have separate legal personality.
Types of Trustees
Statutory corporations
NHS Trust
An NHS Trust is not a trust, but rather a public sector (statutory) corporation, and is accountable to the Department of Health (on behalf of the Secretary of State). It is able to act as charity trustee by virtue of its power ‘to accept gifts of property (including property to be held on trust), either for the general or any specific purposes of the NHS Trust [...] or for any purposes relating to the health service.'
NHS Foundation Trust
An NHS Foundation Trust is described as a ‘public benefit corporation', and is also a public sector (statutory) corporation). NHS Foundation Trusts report to Monitor, rather than the Department Health, and generally have greater freedom to decide how their services are run than NHS Trusts have. NHS Foundation Trusts ‘may accept gifts of property (including property to be held on trust for the purposes of the NHS Foundation Trust of for any purposes relating to the health service [...],' and therefore act as charity trustee.
Independent trustee(s)
The NHS Act 2006 makes provision for the appointment of independent trustees to carry out the trustee function of the statutory corporations. Currently, these are appointed by the Appointments Commission. Once in post, the independent trustees are answerable to the Charity Commission and not to the NHS Trust of NHS Foundation Trust by reference to which they have been appointed.
Independent trustees fall under the following categories:
- Trustees for an NHS Trust
- Trustees for an NHS Foundation Trust
- Special Trustees - Now of limited relevance with only three set remaining, However, these trustees can only apply their assets ‘as respects the hospitals for which they are appointed'.
- Company limited by guarantee - A new form, only yet to have been adopted by the Barts and the London Charity.
