December 27, 2009 12:00 AM

Today, the Liberal Democrats warned that the funds of NHS charities, worth £330m a year, are at risk of being nationalised under new government accounting rules being introduced in April 2010.

The Department of Health has interpreted new Treasury guidelines to the effect that NHS bodies must abide by new International Accounting Standard 27 (IAS 27), which may require the funds of independent NHS charities to be consolidated into the accounts of their 'parent' public NHS bodies.

The warning comes as the Liberal Democrats revealed the list of NHS charities that could be affected (see attached).

Commenting, Jenny Willott, Liberal Democrat Charities Spokesperson, said:

"This move could lead to hundreds of millions of pounds of charitable donations being effectively nationalised under the NHS.

"Consolidating NHS charity funds into the accounts of public NHS bodies will count charitable donations as gifts to the state.

"The government has no right to get its hands on any charitable NHS funds. People make donations to NHS charities on the understanding that it is up to the charity to decide how to spend it, not the government.

"The government could use this as a smokescreen to cover up cuts in future health spending, by replacing public funds with charitable donations.

"This sets a deeply worrying precedent for other public bodies that act as trustees of local charities, such as local authorities.

"The Charity Commission has been voicing their concerns for over a year, but the Government is simply not listening. As we're now getting close to the deadline, the Treasury and Cabinet Office need to sit down and settle this once and for all. These accounting rules are designed for the private sector. They should not apply to charities and the public sector."

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