The woman leading a radical shake-up of the NHS in Kent also runs a private consultancy firm that pocketed £1.4 million from being involved in the process.

NHS chiefs insist the appointment of Dame Ruth Carnall does not constitute a conflict of interest.

Up to December, health consultancy Carnall Farrar Ltd netted the payment to help develop the county’s Sustainability and Transformation Plans (STP).

These set out future health services, seek to plug the £486 million shortfall predicted in the area by 2020 and invest millions in local care to free up hospitals and create £300 million of savings.

They propose three to five hubs in west Kent providing out-of-hours care.

Dame Ruth is a director of Carnall Farrar and also the independent chairman of the STP programme board.

The 60-year-old, who has held several top jobs at NHS trusts, including chief executive at the now-defunct NHS London, set up the company with Hannah Farrar, also a director at the same organisation, and Ben Richardson, a former senior partner at McKinsey & Company.

Cllr Mike Eddy (Lab), a member of Kent County Council’s (KCC) health overview and scrutiny committee, said: “There are serious questions about the way this has been set up and I look forward to those questions being satisfactorily answered, the sooner the better.”

Dr Selwyn D’Costa, BMA South East regional deputy chairman, added: “With one CCG in Kent [West Kent CCG] announcing plans to suspend non-urgent operations until April, patients will understandably find it difficult to see much-needed NHS funds going to a consultancy firm when urgent investment is needed in vital areas of health care.”

The British Medical Association has claimed the costs to Kent from the reforms being implemented under STPs could run to £75 million.

The accusations were rejected by the government and NHS England.

An NHS spokesman said Dame Ruth’s chairmanship was agreed as part of a contract and a neutral chairmanship with no links to any Kent organisations was required. He said: “Carnall Farrar has been appointed to support the programme via a competitive procurement process, adhering to NHS principles and best practice including any declarations of interest.

“Carnall Farrar has no statutory or procurement decision-making role and there is no conflict of interest we are aware of.”

In London, Carnall Farrar received £115,882 for its work on health care in the capital.

Dame Ruth also leads the NHS transformation plan in Devon, with consultancy support in that county from Carnall Farrar.