NHS trusts plunge £1bn into red

Photo: Stefan Rousseau/PA Wire
Photo: Stefan Rousseau/PA Wire
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NHS trusts plunged more than £1 billion into the red last year amid predictions their plight will “deteriorate rapidly”.

Foundation trust regulator Monitor announced elite NHS trusts ran up a £349 million net deficit in 2014-15, blaming a surge in demand for care and high costs of agency staff.

Separate figures from the NHS Trust Development Authority (TDA) reveal remaining NHS trusts were £473m in the red.

The figures fail to take into account further emergency bail-out funding given to dozens of trusts which The Yorkshire Post calculates takes the total to more than £1bn.

In a stark warning, Monitor said the situation was expected to get “even tougher” in the year ahead. Without extra cash or more efficiencies, it said the position was likely to “deteriorate rapidly”.

Already hospital bosses in Yorkshire are forecasting debts are set to approach £150m in 2015-16, heightening pressures on Chancellor George Osborne to deliver an emergency injection of cash.

The highest deficit in the country in 2014-15 was at Barts Health NHS Trust in London at nearly £80m. The highest in Yorkshire was at the Leeds Teaching Hospitals NHS Trust which the NHS TDA said was £24.4m in the red although the figure comes after it received an additional £14m in bail-out cash.

Monitor said there had been a huge “over-reliance” on contract and agency staff, with spending by England’s 152 foundation trusts on temporary workers running to £1.8bn - more than double the amount planned.

In its end-of-year report, it said that taken with the huge increase in demand for care, this had put them under “sustained and exceptional pressure”.

Its analysis found that foundation trusts are treating more urgently-ill people than ever before, with a record-breaking 10.7m emergency inpatients in 2014-15 - a 574,000 increase on the previous year.

Monitor chief executive David Bennett said: “The last financial year was exceptionally challenging for the foundation trust sector and it is clear the current one is following the same pattern.

“The sector can no longer afford to operate on a business-as-usual basis and we all need to redouble our efforts to deliver substantial efficiency gains in order to ensure patients get the services they need.

“This will no doubt involve some significant changes to the way people work at some institutions, but as the regulator we believe there is scope for more to be done at a number of levels without compromising patient care.

“Foundation trusts are providing more treatment, to more patients with more complex care needs. Therefore, it is right that in these difficult circumstances agency staff are used to ensure patients always get quality care,

“However, trusts should act to reduce their over-reliance on agency staff in the longer-term by improving their planning and building up their reserve staffing resources, so they can protect their finances.”

Shadow health secretary Andy Burnham said hospitals faced a “financial crisis”.

“People will wonder how the Prime Minister can possibly pay for his new round of NHS promises when hospitals are sinking into ever-deeper debt now,” he said.

“Without more money this year and next, the NHS will have to brace itself for a round of severe cuts to staffing, beds and services.

“David Cameron was not straight with people at the election on the scale of the problems facing the NHS. With services going backwards and hospitals in financial crisis, it is patients who will pay the price. Rather than empty promises, the Prime Minister must urgently produce a plan to sort out the problems he has caused.”

British Medical Association chairman Mark Porter said the official deficit had increased seven-fold compared to the previous 12 months.

“These figures are extremely worrying and show the extent of the dire financial pressure many hospitals are under,” he said.

“This is no way to run a health service that needs to meet rising demand from an ageing population with complex care needs and we call on government to move away from the current approach to one of investment in health.”

Richard Murray, director of policy at think tank the King’s Fund, said: “Plugging the growing black hole in NHS finances must now be an urgent priority for the Government. There is a real prospect of deficits snowballing and, unless the Government finds extra money, an accelerating decline in NHS performance and a deterioration in patient care.”

A Department of Health spokesman said: “We know the NHS is busier than ever and trusts are facing challenges; however we expect them to show tight financial grip and live within their means.

“We have backed the NHS’s own plan for the future by investing the £8bn needed to deliver it.”