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Payroll fraud costing NHS ‘billions’

24 March 2014

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Fraud and error are costing the NHS at least £7 billon each year, the BBC has reported. 

The biggest areas of fraud are in procurement budgets and payroll, the report from the University of Portsmouth and accountancy firm BDO showed. 

Examples given are an optician charging for glasses which a patient never received, or a consultant doing private work on NHS time. 

At least £2 billion of the NHS budget is lost through accidental overpayments to suppliers or staff, the report shows. 

A report revealed to investigative TV programme Panorama claims that the amount of NHS fraud is 20 times higher than recorded in the government’s annual fraud indicator.

Co-author of the report and ex-director of NHS Counter Fraud Services (now NHS Protect), Jim Gee said it is time to tackle the problem, rather than feeling “embarrassed, or in denial, about the possibility of fraud taking place in the NHS”. 

He told the BBC: “I think fraud is one of the last great unreduced healthcare costs. And to me, putting money into it makes sense. 

“It’s one of the least painful ways of cutting costs. It makes absolute sense to cut the cost of fraud before you cut the quality, or extent of patient services.” 

Government fraud data does not take into account losses in payroll and procurement, Gee has claimed. 

However, Gee based his figures on loss measurement exercises, which he claims are the most rigorous data available on healthcare fraud. 

The Department of Health said it “did not recognise” the figures and would not “speculate on levels of losses”.