From the outset it should be understood that the Society will continue to give the HAS every help and advice that it can, in its capacity as an independent professional society and charity. What the BGS felt it could not do, was to remain as a corporate partner of the HAS when it had doubts over the financial governance of the HAS.

The HAS is no longer funded by the DoH and has to generate its own income from the services it provides. In 2001, the Older Peoples Services of the HAS was losing money and it was only their Mental Health Services which still provided a positive cash flow. At the time the BGS withdrew, the HAS were forecasting a loss of £100,000 for 2002. A plan to reverse the declining trend had been put forward, but under the present conditions in the NHS, the BGS perceived this as a high risk strategy, involving as it did an initial outlay of up to £60,000.

Duty of Care
The BGS was represented on the Board of the HAS by two directors and trustees. Trustees under Section 1(1) of the Trustee Act 2000 have a duty of care. The Charity Commission guidelines state that they ‘are required to act reasonably and prudently in all matters related to the charity’. It is difficult to see how the BGS’ representatives on the HAS Board could have been deemed to be acting prudently, had they supported a financial plan that was, rightly or wrongly, in their opinion and in the opinion of the BGS Executive, an imprudent plan. It would also have created a difficult and uncomfortable situation for the Board of the HAS, in managing the organisation, when two directors were fundamentally opposed to future policy. In consequence the Society felt that it had no alternative but to withdraw from HAS as a corporate member.

In looking at the duty of the BGS trustees one also needs to bear in mind that they were trustees both of the HAS and of the BGS; they therefore had a double duty of care. Whilst the BGS’s financial exposure to any loss by the HAS was limited, it nevertheless seemed to the BGS Executive undesirable that it should support a policy that it considered financially unwise.

It is a matter of great regret that this difference of opinion on financial management should have occurred. The BGS is in every other respect fully supportive of the aims of the HAS and will continue to give every support it can to assist the HAS in its work to improve the provision of older people's services.

R G Lynham
Company Secretary