Commentary on Sections Financial matters Section 13: Public dividend capital
72.Under section 10 of the 1990 Act, each NHS trust is given an originating capital representing the excess of its assets over its liabilities when it is established. This originating capital is “public dividend capital” and the NHS trust must pay dividends on it at a set rate. It constitutes an asset of the Consolidated Fund.
73.Subsection (1) sets out that the public dividend capital of an NHS trust applicant immediately before authorisation is granted continues as public dividend capital under the same conditions for the NHS foundation trust. Under subsection (2) the capital remains an asset of the Consolidated Fund.
74.Subsection (3) provides for the Secretary of State, with the consent of Treasury, to decide the terms on which any public dividend capital of an NHS foundation trust is issued. Under subsection (4) the dividend to be paid by an NHS foundation trust is the same as that payable by NHS trusts in England under section 9(7) of the 1990 Act.
75.Subsection (5) requires the Secretary of State to consult the Independent Regulator before deciding the terms on which any public dividend capital of an NHS foundation trust is to be issued.
76.Subsection (6) requires that any repayment of public dividend capital made to the Secretary of State must be paid into the Consolidated Fund, as it is for NHS trusts.