Under-fire hospital chiefs given cuts warning

UNDER-fire hospital bosses at a Yorkshire health trust must carry out heavy cost-cutting to safeguard its future, experts have warned.

A confidential report obtained by the Yorkshire Post criticises efforts by managers at the Scarborough and North East Yorkshire Healthcare NHS Trust to make savings and calls on them to recognise they are in a "crisis turnaround" situation.

The study by financial consultants PricewaterhouseCoopers warns that the trust faces "major financial challenges" to sustain services in coming years, which will increase when the Government's spending squeeze is imposed on the NHS from April next year.

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The trust required top-up funding of 7.9m in 2009-10 because of long-running financial problems and the report predicts further support will be needed due to its continued "underperformance" and inability to save money.

The report says extra staff should be a "priority" and warns that unless reliance on temporary staff is reduced there will continue to be unbudgeted extra costs on pay.

Latest figures show it forked out 1.5m on bank nurses and locum doctors in the 12 months to March, 3.8m on agency staff and 2.8m on overtime. It has 150 vacancies among its 2,400 staff including 10 fewer consultants than the 77 required, 42 fewer nurses than the establishment of 604 and 19 fewer senior managers than the 63 needed.

The study, drawn up in November for regional health chiefs, said: "There are major financial challenges for the trust and its commissioners over the next few years in sustaining the quality of health in the local community.

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"The trust and the PCTs should also recognise the further challenges that the post-2011 public sector squeeze will bring on their respective organisations and community."

It criticises the approach of trust bosses to cost-cutting although it concedes frequent changes of senior management had not helped.

"Overall we conclude there is a lack of experience in working up and delivering large, more complex, cross-directorate savings schemes," said the experts.

"There is also a lack of delivering recurrent pay savings schemes, with reliance being placed on non-recurrent, largely financial, fixes.

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"This means that the trust's cost base and operating efficiencies are not being addressed and will increase the size of the challenge for future years."

In a statement, trust chief executive Richard Sunley said: "This is old news, as this report was researched and written last year. We have met our financial obligations for 2009-10, achieving a 2m surplus, and we continue to remain focused on the future."

Management at the trust argue their problems in delivering cost savings are compounded by difficulties providing services across a wide area covering Scarborough, Bridlington, Whitby, Driffield and Malton.

Among plans being drawn up to safeguard its future is a strategic review which means some people including heart attack patients, victims of serious accidents and those requiring complex surgery will be transferred to neighbouring hospitals. More care will be provided in the community for people with long-term conditions.