The dramatic resignation of Lawrie Hooper as Health Minister has shone a spotlight on the financial management of overspending Manx Care.

In Tynwald, Chief Minister Alfred Cannan, who has taken over as interim Health Minister, rejected claims by Mr Hooper that the Council of Ministers’ agenda was to privatise the Manx NHS.

And it was revealed that the former Health Minister knew back in April the results of an independent audit report that showed Manx Care was lacking financial controls - but he had failed to present its findings to CoMin.

Announcing his resignation in a personal statement to Tynwald on Tuesday, Mr Hooper said he was now convinced that the Chief Minister’s ultimate aim was to ‘ try to privatise our health service’.

‘That’s not something I can support,’ he said.

‘I had hoped it would not come to this,’ he said. ‘As I fundamentally disagree with the course of action that I believe has been decided upon, I have no option but to resign.’

Manx Care received an extra £43.8m in this year’s Budget - paid for in part by raising the higher rate of income tax from 20% to 22%.

Mr Hooper, however, claims that the organisation was still under-funded by around £12m.

But during a debate on reforming Manx Care in Tynwald the next morning, Mr Cannan described the claims about privatisation as a ‘fabrication’.

‘It is a falsehood and a slur on the Council of Ministers,’ he said. ‘The Minister has done it to perpetrate a distraction.’

Mr Cannan released a copy of an audit report produced for the Department of Health and Social Care in April which reveals a lack of financial oversight and planning.

The Chief Minister told members: ‘It now emerges that he knew, and was informed, in April that Manx Care’s financial planning was not effective, or indeed a priority.

‘He knew in April that an external body had told him that budget holders were in the dark and that operational activities were not being costed, and neither was there a long-term financial plan.

‘He knew back in April that an external body had told him that finances were not even a major risk identified for board appraisal.

‘Instead of telling us this, instead of releasing that report, instead of taking direct action to get resolution, he decided that gaslighting the public that the service was underfunded was the best way forward to cover an action. He has blamed funding instead.

‘He has time after time blamed the fact that the service was underfunded, despite being told in black and white that financial oversight and planning was woefully lacking. If I or Council had known about this report, it would be a different story. We didn't.’

Mr Cannan said the ex-minister had sought to ‘lay the blame of his own failings’ at the door of CoMin by ‘contriving’ a council paper asking for unequivocal support for healthcare free at the point of delivery.

He said Mr Hooper had known ‘full well’ that Ministers would reject his advances given Manx Care’s £16m forecast overspend and ‘no solutions in front of us other than cuts to service’.

‘The only person who has even mentioned privatisation is the former minister. It's his dead cat strategy, and it's failed,’ he said.

A dead cat strategy is where a politician makes a shocking announcement to divert attention from problems or failures in other areas.

Mr Cannan added: ‘The truth is we do not know if the organization is underfunded. We do know as of today that the emphasis on financial planning and financial controls are lacking.

‘We also know that the former minister wants tax rises and unlimited funding for health. It matters not to him how this is achieved - capital gains, inheritance taxes, income taxes, but he wants to impose this on our people and our economy.

‘Whilst he knew, in black and white, that the organisaton was unlikely to be spending its money in a controlled and efficient manner. Enough. There will be action today.’

He said he had met with the chief officer of the DHSC and the Treasury and they will be working with Manx Care to get the financial support together so the ‘organisation can properly business plan for next year’.

The audit report notes that the priorities outlined in Manx Care’s operating plan makes no explicit reference to finance.

‘We understand to date that Manx Care has not produced either a financial strategy to support the delivery of the wider organisational operating plan nor a long-term financial model,’ the report found.

It noted that Manx Care’s headcount had increased by around 350 since its inception with much of these in patient-facing roles. But it said while such investment was in response to a focus on patient safety, this ‘cannot be at any cost’.

Treasury Minister Dr Alex Allinson told Media IoM that he supported the principle of NHS providing care free at the point of need.

He said: ‘Tynwald and Council are committed to the current NHS model as set out in primary legislation.

‘But there is the need for further reforms driven by Manx Care to improve the safety and provision of services to the people of the island whilst balancing demand pressures with a sufficient budget.’