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Fraud costs NHS £7bn - enough to pay for 250,000 nurses

Hundreds of thousands of additional nurses could be employed if the health service reduced the amount of money it loses annually through fraud, a report suggests.

The former head of NHS Counter Fraud Services has warned in a report that fraud is costing the NHS £5bn a year, with a further £2bn lost to financial errors.

The amount lost to fraud alone could pay for nearly 250,000 nurses, according to the report. It is the focus of an investigation by the Panorama programme, which is due to be broadcast tonight on BBC One at 8.30pm.

Jim Gee, co-author of the Portsmouth University study, was director of NHS Counter Fraud Services for eight years until 2006.

The £7bn estimate is based on a comparison with global figures, which suggest average losses to fraud and error of around 7% of healthcare budgets. It is 20 times higher than the figure recorded in the government’s annual fraud indicator report.

“We need to get on with tackling the problem and maximising resources available for proper patient care”

Jim Gee

Mr Gee, who is currently director of counter fraud services at accountancy firm BDO LLP, identified key types of fraud as non-payment of prescription charges by patients, medical professionals claiming for work they have not done and overcharging by contractors.

“We need to not be embarrassed, or in denial, about the possibility of fraud taking place in the NHS,” he told Panorama.

“We need to get on with tackling the problem, minimising its cost, maximising resources available for proper patient care.”

However, the Department of Health has said it “does not recognise” the figures in the report.

Peter Carter, chief executive and general secretary of the Royal College of Nursing, said: “These shocking findings highlight that nothing has been done to tackle inefficiency and waste.

Peter Carter

“Instead, frontline staff and services have suffered as the Health Service has sought to find its £3bn worth of savings a year,” he said.

“Tackling this fraud and dealing with its consequences would go a long way towards ensuring that the NHS can make savings without affecting patient care.”

Dr Carter added: “Rather than disputing the figures, the Department of Health should be taking immediate action.”

Readers' comments (14)

  • tinkerbell

    who's doing all this fraud? Is it people with budgets, it's certainly not frontline staff.

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  • 7Billion is one heck of a lot of money in fraud.I'm with Tinkerbell here.Who is doing the fraud?

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  • I just find it amusing that nurses have had one of the worst ever pay settlements and you can barely get a peep out of Carter and his circus, yet something that's got absolutely nothing whatsoever to do with him and he's all over it like a rash.

    Carter: your nurses have had money stolen from them by the government, why not activate yourself and sort that out rather than mouthing-off about this?

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  • i know i would give much more weight to what mr gee has to say, than some anonymous press officer at the dept of health.

    watched the panorama programme, plenty of examples of frontline staff as culprits.

    search great nhs robbery to find articles detailing the extent of equipment loss by hospitals/clinics, eg beds, monitors, ventilators. you'll be gobsmacked.

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  • just look at 'linked articles', if you think frontline staff not involved.

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  • tinkerbell

    Panorama highlighted that Serco were not held to account despite lying 252 times because they are a private provider. What?

    Not enough fraud investigators to do their job properly, where we've heard that before?

    Fraud investigators having to mostly rely on tip offs to go and look on ebay to see what's going on.

    Low hanging fruit sacked but dodgy dentists allowed to continue in practice who have previously been defrauding allowed to pay back what they owed then went on to defraud a further 1.4 million.

    Government hasn't even provided a budget for 2013/14 for providing enough fraud investigators.

    What could possibly go wrong?

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  • tinkerbell

    does this also include (exclude) the £3.5 plus billion spent on the pantomime re-disorganisation and the privatisation of OUR NHS.

    Fraud is fraud! Lying and deceiving a society, fraudulent claim, 'no decision about me without me' and then bringing clause 119 into law.

    'NHS safe in our hands' biggest porkie.

    Condems fixing the figures a lot lower on how much fraud is going on because they won't provide enough fraudbusters to do their job properly.

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  • Save a few quid stoping these recruitment drives in the Algarve and Costa's. Or doesn't the 'bribe' that the Iberian countries pay us to take their 'creme de la creme' count as fraud?
    Or the company currently renovating our AED who have taken 4 months to knock down a small shed and pour a few hundred cubic metres of concrete? The entire city centre of Liverpool was knocked down and rebuilt in a shorter timespan than planned for our renovations. Is that not fraud?
    What about Ministers getting jobs on the boards of private companies for the simple fact of selling off OUR property. £50,000 pa for a 3 hour week! Isn't that fraud?
    Fact is, this country has slowly and surely become the same as any tinpot banana republic with corrupt politicians and policemen being the order of the day, the norm rather than the exception.

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  • tinkerbell

    a while back the trust fraud guy came to give us a talk about fraud obviously. He started 'anyone ever taken something from the stationery cupboard?' All quiet.

    He went on to give examples of how staff in the trust had committed fraud. One was charging visitors a £1 to park. I said 'they should have at least charged £2.50'.

    Another manager was booking staff and not using them and filtering the money amongst various friends bank accounts. I asked how she managed to do it - he explained. I said 'Cor that's a good one innit?'.

    At some point he must have thought I'd got the wrong end of the stick regarding his lecture and said to me 'look i'm not here to give you tips on how to defraud the nhs'.,

    I said 'I know, it's just amazing how they think this stuff up'.

    I got my coat.

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  • The answer to the question "who is doing the fraud?" is... no-one

    This is a flawed report based on bogus numbers:

    https://fullfact.org/health/fraud_cost_nhs_panorama-30819

    Of course, no-one is suggesting for one minute that the government knows this but is happy to keep slagging the NHS off...

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  • ...or somebody else?

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  • tinkerbell

    Jodie's mate | 28-Mar-2014 8:12 am

    Agree. There's something decidedly fishy going on and it reeks of manipulation, can't quite get the handle on who's doing what to who, but no doubt it's not in our best interests.

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  • Me thinks the biggest fraud will be when they privatise the NHS.

    Lots of money can be claimed and signed away at the push of a pen by business men who know how to shimmee that hula skirt of empty cheques and 'enterprise initiatives' in the name of our health of course.

    And it will be done so slick it will make the great train robbery look like a bungled case of shoplifting.

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  • I should add that in my opinion this is no doubt what is happening already.

    Hope this goes unnoticed before them pesky Troll Laws come through. Could find myself in the slammer for airing my views ;) I wouldn't want to let my team down, only just got the DBS through after 10 weeks....

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