£19m debt revealed as NHS ‘heads for iceberg’

Senior officials at North Yorkshire’s primary care trust admit they must carry out one of the biggest shake-ups in health provision in a century to counter the multi-million pound deficit.

Managers are warning the predicted £19m shortfall is a best case figure – and the debts could escalate even further in a crisis which is the latest to hit the NHS in the county in the last decade.

The revelations come as the NHS Confederation, which represents NHS trusts and today opens its annual conference in Manchester, warns of a looming financial disaster as the Government pushes ahead with its controversial healthcare reforms, as well as ordering a £20bn savings programme. A poll of 250 top NHS managers reveals almost half fear cost-cutting will reduce the quality of care in the next year.

Its chief executive, Mike Farrar, said there were grave concerns about “the storm clouds that are gathering around the NHS”.

He added: “Frankly, without action on the way we provide health and social care, the NHS looks like a supertanker heading for an iceberg. The danger is clearly in view and looming ever-larger. We know what needs to happen. But are we going to be able to take the assertive action needed in time?”

Katherine Murphy, of the Patients’ Association, said: “Treatments are being rationed, waiting times for elective procedures are going up and patients continue to be treated poorly on our hospital wards. All of this, and the £20bn of efficiency savings haven’t even started to bite yet.”

Health Secretary Andrew Lansley admitted financial pressures needed to be addressed, but said the NHS was “performing extremely well”.

“The NHS needs to change to match the needs of a changing population,” he said. “We will not shy away from difficult decisions involved in that.”

The financial crisis in North Yorkshire has emerged as the Government’s latest NHS restructuring leads to the end of regional health authorities next March.

Officials have revealed that since the county’s primary care trust (PCT) was set up in October 2006, NHS services in the county have relied on bail-outs totalling more than £100m from Yorkshire’s health authority.

But NHS North Yorkshire and York’s chief executive, Christopher Long, confirmed the authority’s demise means the end of the financial lifeline. The PCT will itself be disbanded with GP-led clinical commissioning groups taking over from April. It is now anticipated the groups will inherit a large proportion of the PCT’s debts.

Fears are growing that the £19m deficit will worsen as the PCT is already faced with making £22.5m savings on its £1.25bn budget, prompting renewed warnings the delivery of services in the county is no longer financially sustainable.

Health chiefs are drawing up a turnaround plan to deliver “safe, sustainable and affordable services” leading to a major shift from hospital care to provide more services in the community.

Mr Long warned “difficult decisions” lay ahead. “The PCT has been in serous financial difficulty for a number of years and this must be addressed in order for us to protect the future of the region’s health economy,” he said.

“The way services are currently delivered in North Yorkshire and York is not sustainable and we must look to new ways of working to ensure the clinical commissioning groups are in the best possible position when they take over commissioning responsibilities in April 2013.”