Wholly Owned Subsidiaries

Paula Sherriff MP for Dewsbury, Mirfield, Denby Dale and Kirkburton has replied to a request for her views on Wholly Owned Companies/Subsidiary Companies/ Special Purpose Vehicles, whatever you want to call them,  in NHS Hospital Trusts.  Her first sentence on the subject starts with the phrase “I am alarmed…..”  so we are not alone.

 Paula Sherriff MP on Subsidiary Companies 

The attempts to dismantle the NHS have been going on for over 25 years.  The changes to legislation inching closer and closer to the healthcare multinationals global policy aims, become clearer when we find the legislation to allow the SubCos, was introduced in 2006, two years before the need to create  the campaign organisation Keep Our NHS Public and probably one of the driving factors in its creation. This is before all but the most eagle eyed of the public,  even began to suspect anything untoward.

Messages released by Government are sometimes contradictory. On the one hand you have a letter to Trusts from the Department of health suggesting these companies are not allowed as a mechanism to save VAT, yet the Trusts using that argument as the main motivator for spending the money to do it. Companies need capital to set up that surely could be used for treatment. Why now?

DoH Tax Avoidance Letter

Yesterday in Leeds the landmark England wide Judicial Review brought by a grass roots campaign group 999 Call for the NHS, against NHS England for its proposed Accountable Care Contract,  was heard. The case examined a point of law, which the group believe is unlawful in the ACO contract and will encourage providers to cherry pick patients rather than provide comprehensive treatment for all, according to need. Since this is already beginning to happen and patients made to wait, such an outcome seems more likely with every passing day. Even if the campaign wins the Judicial Review, NHS England will have suffered a set back but will be able to try again.

The second Judicial Review is about the new health system Government and NHS England want to legalise, with no recourse to Parliamentary debate or public vote.  That is due to be heard on 23rd and 24th May in London.

Dewsbury stall popular with the public

At the street stalls in Dewsbury and Batley many people came over to take a leaflet and sign the petition. The petition is to ask Mid Yorkshire Hospitals NHS Trust Directors, to think again before committing to a SPV as they are calling the potential Subsidiary Company wholly owned by the Trust Board.


We are hearing that the staff do not want to be ‘divorced’ from the NHS. Members of the public  told us they would post their requests for the Trust to think again, directly to the Trust. The leaflet is in the link below.

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Campaign Group writes to Mid Yorkshire Hospital Trust to ask them to think again about SPV

Signing the petition on paper on Dewsbury Market.

Dewsbury Keep Our NHS Public, has launched a campaign and petition arguing against a move proposed by Mid Yorkshire Hospitals NHS Trust, to set up a Special Purpose Vehicle (SPV) which would be a new subsidiary Company owned by the Trust Board, in other words a privatisation.   Dewsbury KONP urge the MYHT Board to follow the lead of Bristol’s Southmead Hospital Trust which has scrapped their plans.


The campaign group say ” any new company will potentially

  • move staff including cleaners, porters and catering staff not already employed by the PFI company (Public/Private Finance Initiative) into the new company under TUPE regulations. This will split the NHS team, potentially leaving staff feeling isolated and abandoned.

  • offer less favourable terms and conditions to new staff, creating a 2 tier workforce

  • create an extra tier of governance and management

  • potentially and unacceptably move buildings and estates from public, into private ownership at the stroke of a pen.

  • impact on patient experience through lower terms and conditions creating a transient workforce in the future.

Christine Hyde said “The move is likely to have been encouraged by management consultants considering that both Airedale and Harrogate Trusts have already set up a subsidiary company each and Calderdale and Huddersfield Foundation Trust has agreed to set one up too. CHFT, Airedale and Harrogate Trusts belong to the same West Yorkshire Association of Acute Trusts (WYAAT) as Mid Yorkshire. New research indicates that advice from management consultants make the NHS LESS not more efficient. We are keen to alert the Trust to such research and help them resist the enormous pressure they must be under through underfunding and relentless redisorganisation by the Government and NHS regulatory bodies. We urge the Trust not to dismantle the NHS in its 70th year.”.

Liz Twist MP has set up EDM 802 asking the government to block further attempts to set up these SubCos due to the likelihood of them being “short term fixes that will create further problems in the future”. Thelma Walker MP has signed it. Calderdale and Huddersfield Foundation Trust have not as of 22 March 2018, yet lodged their arms length company with Companies House.

 John Grogan MP said of the development at Airedale which went live earlier in the year

“I’ve met Health Minister Philip Dunne to express concerns that if trusts throughout the country continue setting up subsidiary companies there’ll be a big loss of VAT revenue to the Exchequer, which could be used to fund NHS staff pay rises”.

Issues of tax avoidance in relation to these new private companies, have been raised in the Parliament and Stephen Barclay Minister of State (Health and Social Care said .. “the Department has been clear that the setting up of a subsidiary is not a vehicle to avoid VAT.”

David Honeybell said It’s our NHS, funded by our taxes and NI contributions, and that’s how it must stay. We must not allow any part of our NHS to be sold off or transferred to any other body, who ever (sic) sets them up.

Jenifer Devlin said “The assets that will be transferred belong to us and the NHS. They must not be privatised”.

Paula Sherriff MP has been invited to comment but has yet to send a reply. 

A copy of the letter to the Board can be found in the link.

MYHT SPV letter to Board to publish