Two health trusts battle deficits as NHS financial worries worsen

ANOTHER NHS trust in the region has been ordered to take urgent action to repair a massive hole in its finances as a second yesterday revealed the scale of the challenge it faces after plunging into the red.

Regulator Monitor has told the South Tees Hospitals NHS Foundation Trust, serving 125,000 people in North Yorkshire, to tackle failings in finances, leadership and infection control.

It comes after bosses at the Barnsley NHS Foundation Trust were last month ordered to draw up a turnaround plan after a whistleblower exposed still unspecified “financial irregularities” only weeks after its directors were assured it was on course to return a surplus. It ran up a £7.4m deficit in 2013-14 and yesterday said it is expecting to be £11.9m in the red this year.

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The South Tees trust, which runs services at the Friarage Hospital in Northallerton and the James Cook Hospital in Middlesbrough, has been ordered to take action over a deficit expected to be £35m in 2014-15 on income of £540m, and as much as £52m next year.

The problems come amid growing national concerns over worsening hospital finances.

The position at South Tees has dramatically deteriorated after it was only £5m in the red in 2013-14, with managers blaming efficiency savings shortfalls and extra costs of measures to sustain quality and meet key targets.

It has been ordered to draw up a recovery plan with consultants McKinsey and commission an external review to identify what has gone wrong and why.

Monitor regional director Frances Shattock said: “This trust has financial and infection control failings that have to be fixed and quickly. We’ve taken action because the trust board has not addressed these risks fully. We need to secure quality patient services for the people of Middlesbrough and North Yorkshire for years to come.”

Trust chief executive Prof Tricia Hart said: “The trust has always had a strong focus on providing high quality, safe services... and while we are facing some tough challenges, not least our financial position, our commitment to providing excellent services and care for our patients will not change.”

Officials in Barnsley have drawn up plans for £6m in efficiencie savings in 2014-15 on income of £165m which will target back office roles and procurement.

Latest figures reveal it has received £10m in emergency funding from the Department of Health to support its short-term cashflow. Consultants from KPMG are examining its finances and experts from Deloitte are also involved after Monitor said there was a there was a “wider issue with how the trust is being run”.

Chief executive Diane Wake said: “The trust board would like to reassure patients and the public of our confidence in our ability to continue to improve our position and deliver on the plan.”