Ministers have been accused of planning to seize control of £2billion in assets managed by hospital charities; they plan to change NHS accounting procedure, which critics say will make it easier to slash health budgets. And, in effect charitable donations to hospitals are to be “nationalised” under the procedure – they will be under the control of the state. 

Ministers are imposing new rules on NHS charities requiring all donations - including those to specialist children and cancer units, local fundraising campaigns, teaching hospitals and local community trusts - to be listed on a hospital’s balance sheet. 

The Charities Commission says that this is “wholly inappropriate” because combining the trust and charity accounts will jeopardise the charity’s autonomy and discourage donations. About £330 million was given to 300 NHS charities in the year to June 2008, and they control an estimated £2 billion of assets. A spokeswoman for the Commission said: “The Charity Commission does not agree with the interpretation of the accounting rules in the Department of Health letter to NHS bodies. We are currently engaging with the Department on this matter.” 

Charities also fear that the change, due to come into effect in April, will be used as a smokescreen to hide cuts in health spending, with ministers reducing funds for organisations such as children’s hospitals that have successful charitable arms. 

Up to 300 NHS charities could be affected by the new rules, with the threat likely to be greatest to hospitals such as Great Ormond Street Children’s Hospital in London, which received £60million in charitable donations in the year to April 2008.  

Liberal Democrat Shadow Cabinet Office Secretary, Jenny Willott said: “This could lead to hundreds of millions of pounds of charitable donations being effectively nationalised under the NHS. 

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

A source at a leading hospital said that the rule change appeared entirely unreasonable and risked creating unnecessary budgetary pressures and distorted disparities between hospitals with different levels of fundraising ability.

Ministers were banned from counting charitable donations towards the central NHS budget under the original legislation that created the NHS in 1948. 

But this looks set to be reversed after the Treasury agreed to implement International Accounting Standard (IAS) 27. Now all NHS Trusts whose trustees have the “power to control” their charitable arm look likely to be forced to consolidate both sets of accounts in one. Estimates of the number of NHS charities affected vary between 30 and 300 organisations. 

A Department of Health spokesman said: “The accounting rule does not change the fact that the deployment of all the monies donated remain the responsibility of the trustees.”