In December 2010, the Department of Health issued guidance on the transfer of charitable funds from primary care trusts (PCTs) to NHS trusts as part of the Transforming Community Services (TCS) agenda. This is the process by which the provider functions of PCTs are being transferred to existing NHS or foundation trusts, newly formed NHS trusts or non-NHS bodies, such as social enterprises.

The vast majority of PCTs have charitable funds relating to the community services transferring. Though most of these funds should follow the services transferred, they may be transferred to another NHS body for efficient management if they are below a certain level. Current guidance is that funds should have a minimum balance of £500,000 to be managed effectively.

The transfer of charitable funds where services transfer between existing NHS bodies is generally effected by a statutory instrument. Some PCT transfers are effected by a non-statutory “transfer order”. Transfer orders cannot be used, however, where the funds are being transferred to a non-NHS body or foundation trust.

Further guidance on transfers from dissolving PCTs is expected to be issued by the Department of Health shortly. This guidance will become increasingly relevant as we approach the dissolution of PCTs in 2013.