NHS fat cat used banned trick to begin drawing his £2m pension
Hunt acts after Mail exposes ruse
A HEALTH service fat cat is under investigation for using a banned pension trick to claim more than £ 300,000 in taxpayerfunded benefits.
Basil Fozard retired as a hospital medical director earlier this summer to start drawing from his £1.9million NHS pension pot.
He was then swiftly rehired on a salary of £ 152,000 – about £20,000 more than he had been earning for the same job just a few weeks before. Mr Fozard made the move the day before Health Secretary Jeremy Hunt banned NHS bosses from boosting their pay in this way.
He did so even though his employer, the Royal Bournemouth and Christchurch Hospitals NHS Foundation Trust, had declared a £5.2million deficit.
Last night, Mr Hunt launched an investigation into Mr Fozard’s pay package after being told about the case by the Mail.
The Department of Health has asked the hospital for an urgent explanation, describing the deal as ‘completely unacceptable’.
Conor Burns, the local Conservative MP for Bournemouth West, said the pay package was ‘an abuse of vital funding’.
He added: ‘ The idea that money is being siphoned away from frontline patient care, not to pay salaries but to pay basically concealed bonuses to administrative staff – I think people will find appalling.’
Mr Hunt announced tough measures to limit NHS fat cat pay on June 1 after revelations by the Daily Mail’s Investigations Unit about the obscene remuneration deals being claimed by failing NHS chiefs. Hospital bosses handed themselves £35million in pay rises despite the worst funding crisis in a generation. More than a fifth of NHS directors were found to be earning more than David Cameron.
Some were using pay-boosting ruses such as exploiting a loophole in the NHS pension scheme allowing managers to ‘retire’ and claim benefits before returning to their jobs on inflated salaries.
After the Mail’s campaign, Mr Hunt wrote to hospital trusts and clinical commissioning groups warning that the retirement trick must stop and that hospitals should no longer award pay rises to bosses who opt out of the NHS pension scheme. Mr Fozard retired on May 31 – a day before the crackdown.
He could then start drawing benefits from his £1.9million pension, including a tax-free lump sum this year of at least £320,000. And despite the rule changes, he went back to his job on July 1.
Last year Mr Fozard, 59, was on an annual salary of £130,000 to £135,000 as medical director at the Royal Bournemouth and Christchurch Hospitals, as well as earning £ 85,000 extra for work as a consultant colorectal surgeon. He also used to work privately as a surgeon.
He no longer does consulting work and is now earning a salary as medical director of £152,000.
His retirement and re-employment were never announced publicly through the media but written in a footnote of the trust’s latest accounts.
The Department of Health does not have direct control over hospitals operated as foundation trusts, which most are.
But trusts wanting to pay managers more than the £142,500 salary of the Prime Minister have been told they must justify the deals to Mr Hunt.
The Health Secretary will now formally regulate to end the retirement trick.
The Department of Health said: ‘We intend to regulate to end this practice for directors and chief executives by next April, and in the meantime we have contacted the hospital to seek an urgent explanation.’
In December 2013 – three months after Mr Fozard started as medical director – the Care Quality Commission found patients at the Royal Bournemouth Hospital were left in soiled beds, with staff complaining of being ‘unsupported and under too much pressure’.
A spokesman for the trust said Mr Fozard’s salary as medical director had increased because he is dedicating more time to the job now than previously.
He added: ‘As his role has changed since his return, he is now spending more time as medical director and is earning 25 per cent less pro rata than he did before he retired.’