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Royal Newcastle Infirmary Accounting for Healthcare in the Newcastle Infirmary During the 19th Century Andrew John Holden Thesis submitted for the degree of Doctor of Philosophy Newcastle University Business School June 2018 i To Gill, Olly and Emily for all your support, encouragement and love ii Newcastle Infirmary c 1815 Figure 0.1 – The Newcastle Infirmary (Source: Welcome Library Images) To serve the needy, sick and lame, This splendid shilling freely came, From one who knows the want of wealth, And what is more - the want of health. Beneath this roof may thousands find, The greatest blessings of mankind; And hence may millions learn to know, That to do good’s our end below; That Vice and Folly must decay Ere we can reach eternal day! (Anon. Above poem written on a note which enclosed a shilling left in a poor box 1752 – from Hume 1951, p. 5) iii Abstract Accounting played a critical role in the management of the Newcastle Infirmary during the 19th century. In a class-based society, the poor relied upon the generosity of the wealthy for their healthcare at a time when poverty itself was seen as a sin, an act against God. These wealthy donors established and maintained hospitals, such as the Newcastle Infirmary, and were responsible for the governance, management and admission of patients. Their aim was to be seen to use resources efficiently and to treat the “deserving poor” to restore them to productive members of society. Throughout the century new buildings, medical advances and increasingly highly specialised staff had to be financed to cope with increasing demand. In the last quarter of the century, paid administrators were employed to manage the Infirmary as finance came less from the wealthy few and more from individual workers and separate charitable bodies. This thesis demonstrates how the management of the Newcastle Infirmary used accounting as a moral practice to allow treatment for patients who were outside the rules, which were a guide to the admission and treatment of patients, and to justify expenditure on large capital projects on nothing more than acts of faith. In turn, accounting was used as a tool to hold managers accountable for their actions and as a vehicle for communicating that accountability to the changing providers of finance. This thesis adds to the literature on accounting within early voluntary hospitals by identifying the balance of contributions of costing systems to planning and decision making and the impact of finance on governance and holding managers accountable for their performance and the successful treatment of patients. iv Acknowledgements It is fair to say that this has been some journey. When I first joined Newcastle University back in 2003 as a teaching fellow I did not expect to be still here fourteen years later and I certainly did not expect to be submitting a PhD thesis for examination for the degree of Doctor of Philosophy. I owe a great deal to Professor David Oldroyd, who like me was a qualified Chartered Accountant, and also like me had left the profession and entered academia. David was always keen to encourage teaching fellows to take on research, ideally based upon their interests, knowledge and first degrees. As a qualified accountant with an interest in history and a first degree in a medical science (physiology and pharmacology) I took his advice and started looking into medical accounting history in early 2007. Around this time David introduced me to Professor Warwick Funnell and together they encouraged my preliminary research into the historical accounting records surviving from the Newcastle Royal Victoria Infirmary. Together we have written two papers which have been published in Accounting, Auditing and Accountability Journal. The first “Accounting and the moral economy of illness in Victorian England: the Newcastle Infirmary” was published in 2009 and the second “Costing in the Newcastle Infirmary, 1840-1888” was published in 2014 and both form an integral part of this thesis. I collected all the data and archival evidence for both these papers and David and Warwick helped to refine my ideas and contextualise the papers within the accounting literature. This thesis builds on these papers by extending the time frame to cover the entire 19th century as well as provide greater empirical data and new additions to our knowledge of the funding of voluntary hospitals. David was my first official supervisor and helped me to get the ball rolling before moving on to pastures new. Unfortunately, moving on to pastures new became a repeated story with v my official supervisors but I would like to thanks Tom McLean, Professor Kathryn Haynes, Professor Jim Haslam, and my current Newcastle supervisor, Professor David Higgins, for all their support and guidance. My greatest academic thanks must go to Professor Warwick Funnell. Warwick has been my one consistent supervisor without whom this research thesis would not have been completed. Warwick helped me through some dark times in my PhD journey and for his endless enthusiasm and support I will always be in his debt. Finally, but by no means least, I would like to thank my family. To mum, writing your two books and starting your third has been truly inspirational and a key factor in giving me the belief to start my own writing journey. To Olly and Emily, thank you for being you! To Gill, my greatest thanks of all for never doubting for one second that I could complete the journey. AJH 31 July 2017 Newcastle upon Tyne vi Contents ABSTRACT ......................................................................................................................... iv ACKNOWLEDGEMENTS .................................................................................................. v LIST OF FIGURES .............................................................................................................. xi LIST OF TABLES ............................................................................................................. xiii CHAPTER 1 INTRODUCTION ........................................................................................... 1 1.1 AIMS OF THE THESIS ..................................................................................................... 1 1.2 THE VALUE OF ACCOUNTING HISTORY ........................................................................ 5 1.3 THE CRITICAL NATURE OF ACCOUNTING ..................................................................... 8 1.4 ACCOUNTING AS A MORAL PRACTICE ........................................................................ 13 1.5 METHODOLOGY .......................................................................................................... 16 1.5.1 Case Study Approach.......................................................................................... 16 1.5.2 The Scope of the Thesis ...................................................................................... 21 1.5.3 The Archival Data .............................................................................................. 23 1.6 ORGANISATION OF THE THESIS ................................................................................... 26 CHAPTER 2 MEDICINE AND THE MORAL ECONOMY OF POVERTY IN THE 19TH CENTURY .......................................................................................................................... 28 2.1 INTRODUCTION ........................................................................................................... 28 2.2 THE RISE OF MEDICAL KNOWLEDGE – A SUBTLE CHANGE OF FAITH ........................ 29 2.3 MONARCHY AND POLITICS DURING THE 19TH CENTURY ............................................. 35 2.4 THE MORAL ECONOMY OF POVERTY: THE VIRTUOUS SICK POOR IN 19TH CENTURY SOCIETY ...................................................................................................................... 38 2.5 THE POOR IN CLASSICAL POLITICAL ECONOMY ......................................................... 41 2.6 POOR-RELIEF AND “EFFICACIOUS ASSUAGINGS OF DISTRESS” ................................... 43 2.7 CONCLUSION .............................................................................................................. 46 CHAPTER 3 NEWCASTLE, ITS ORIGINS, GROWTH AND ACHIEVEMENTS ........ 49 3.1 INTRODUCTION ........................................................................................................... 49 3.2 NEWCASTLE – ITS ORIGIN AND EARLY YEARS ........................................................... 51 3.3 COMMERCE AND MANUFACTURE IN THE 19TH CENTURY ............................................ 62 3.4 NEWCASTLE AND THE NORTH EAST IN THE 19TH CENTURY ........................................ 67 vii 3.5 SOCIETY AND ATTITUDES TOWARDS THE POOR IN NEWCASTLE AND THE NORTH EAST IN THE 18TH AND 19TH CENTURIES ................................................................................ 71 3.6 THE CHURCH IN NEWCASTLE AND NORTHUMBERLAND ............................................. 76 3.7 MEDICINE AND MEDICAL CARE IN NEWCASTLE ......................................................... 82 3.8 CONCLUSION .............................................................................................................. 86 CHAPTER 4 ACCOUNTING AS A MEANS OF MORAL PERSUASION .................... 89 4.1 INTRODUCTION ........................................................................................................... 89 4.2 THE INFIRMARY – ITS FORMATION AND EARLY YEARS .............................................. 92 4.3 ELIGIBILITY FOR ADMISSIONS
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