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Last Updated: Thursday, 13 October 2005, 22:56 GMT 23:56 UK
Elite NHS hospitals facing debts
By Nick Triggle
BBC health reporter

The combined deficit is 37m
Foundation hospitals ran up 37m of debt last year, a report to go before parliament next month will show.

Foundation trusts, unlike the rest of the NHS in England, only have to break even over a five-year cycle.

But experts said the level of debt was worrying as wards had closed and job losses been considered, with evidence things were worsening.

Monitor, the regulator compiling the report on the 25 trusts, said moves had been made to remedy the situation.

There are currently 32 foundation trusts - top-performing NHS hospitals which have been given freedom from government control and have the ability to raise their own funds - but only 25 were operating for all or part of the last financial year.

It is concerning to see services are being cut and jobs may go. It is happening all over the country
Paul Miller, of the British Medical Association

Three trusts - Bradford, Peterborough and Stamford, and Royal Devon and Exeter - were responsible for most of the debt.

Each finished the financial year more than 7m in the red.

Monitor has only intervened in Bradford, replacing its chairman in December, but it said it was keeping an eye on the others after they had drawn up action plans.

The trusts have blamed a combination of rising drug costs, pay rises and a new system of funding.

But campaigners and doctors said it was concerning, as services were being cut back.

The Peterborough and Stamford trust has closed two wards already and is considering job cuts to help them reduce the deficit.

Finance director Christopher Hall said he was disappointed with the deficit, but said patient care would not be adversely affected by the measures being taken.

Dr John Lister, of union-funded pressure group Health Emergency, said he thought it was "just the tip of the iceberg".


"These are supposedly are best trusts, but they are struggling with finances.

"I think we will see more getting into difficulty in time."

Stockport NHS Foundation Trust, which finished last year with a surplus, has already reported it is facing a 5m deficit this year and is considering axing jobs.

Chief executive Dr Chris Burke said the trust was taking a prudent look at the financial position and would safeguard clinical services.

The Royal Devon and Exeter Trust run up a deficit of 7.3m to April 2005.

Mark Stevens, finance director, said it had proved difficult to meet the extra costs generated by new pay and conditions deals for consultants and nurses.

However, he said the trust planned to be back in surplus by 2006-2007.

Paul Miller, chairman of the British Medical Association's consultants committee, said it was not surprising to see foundation trusts struggling as the rest of the NHS was facing financial difficulties - one in four trusts failed to balance their books last year.

"It is concerning to see services are being cut and jobs may go. It is happening all over the country."

A spokesman for Monitor admitted some of the debts had risen too high, but added: "The important thing is that steps are being taken to deal with the deficits.

"We are aware of the situation and will keep watching how it develops."

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