£59m bill for flu pandemic that never happened

The NHS has lost nearly £300m through private sector contracts that went wrong and scares about flu epidemics that never happened.

"Impairment losses", "constructive losses" and "fruitless payments" are all items listed in the NHS accounts for 2010-11.

The private company Clinicentra was paid £8m after the London North Independent Sector Treatment Centre project, which was to have been built and run privately to treat NHS patients, was terminated early at the request of NHS London.

The NHS also settled a two-year dispute with the Dutch pharmaceutical company Synthon over licensing of medicinal products by paying about £30m in compensation.

There are also recorded losses of £6.1m on a programme called E-Learning for Healthcare, after budget cuts led to 20 projects being cancelled. Another £1.6m was lost when a contract with a company called Agilisys Holdings to develop the NHS Gateway IT programme was cut short. There is also a recorded loss of £6.1m on "assets under construction".

More than £79m has been written off as an "impairment loss" because the Department of Health was unable to find documentary evidence that antiviral medicines acquired to deal with the 2009 outbreak of swine flu were properly stored.

Another £59m has been written off for medicines accumulated in case of a flu pandemic which have passed their use-by date. Most were more than five years old. The Labour Government decided in 2007 to spend £150m to double the stockpile of Tamiflu tablets to around 30 million doses.

Even so, in May 2009, pharmacists were suddenly faced with a 700 per cent leap in customers trying to buy Tamiflu, and the Government issued a public warning against buying over the internet.

The panic was a bonanza for Roche, the manufacturer of Tamiflu, and GlaxoSmithKline, which made the rival product Relenza, but the number of deaths in the UK attributed to swine flu was just 393, in six months.

The biggest single loss recorded in the accounts, however, is a purely technical one over which the NHS management has no control. When a company goes bust owing national insurance that cannot be collected, part of the lost revenue has to be shown up on NHS accounts. Last year, the "cost" to the health service was recorded as more than £150m.

The NHS also had to write off nearly £31m of inventory that had been acquired as a precaution in case of terrorist attacks using chemical, biological, radiological or nuclear agents, which had to be disposed of and replaced because it was past its shelf life.

The Health Minister, Simon Burns, blamed all of the losses on the Labour Government. He said: "All these payments relate to contracts signed under Labour, who gave the private sector preferential treatment in the NHS."

Call for more training for foreign doctors

* Newly qualified and foreign doctors working in the UK should go on a basic induction course before they start to treat patients, a regulator said yesterday.

The General Medical Council made the suggestion after some new doctors were found to have started clinical practice with little or no preparation for working in the UK and some locums were taking on duties without having had appropriate training.

Last year a government review into out-of-hours healthcare called for proper inductions for all doctors who had never worked such hours, or in the NHS.

The GMC's call came after a coroner ruled David Gray, 70, was unlawfully killed in February 2008 when German doctor Daniel Ubani, above, administered 10 times the recommended dose of the painkiller diamorphine.

Dr Ubani, 67, was providing cover for GPs in and around Newmarket, Suffolk, when called to treat Mr Gray at his home in Manea, Cambridgeshire.

Ellen Branagh