NHS trust for West Suffolk Hospital in Bury St Edmunds seeks £17 million in support
The trust which runs West Suffolk Hospital in Bury St Edmunds has sought £17 million from the Government as its ‘cash position continues to deteriorate’.
West Suffolk NHS Foundation Trust (WSFT), which also runs Newmarket Community Hospital, is in a worse financial position than it planned and has applied to NHS England for the cash support.
At the end of August, the trust reported a £14 million deficit, which was £5 million worse than it planned to be at that point.
WSFT has previously warned of a challenging financial position as it needs to save £38 million over the next three years.
It said the situation is due to many factors, including non-recurrent funding received during Covid-19, rising costs due to high inflation in recent years and costs associated with around two years of industrial action.
In papers to the trust’s board, which meets tomorrow, Dr Ewen Cameron, chief executive of the trust, said the £14 million deficit was very close to their agreed £15.2 million planned deficit for the year.
The trust aims to deliver a Cost Improvement Programme (CIP) of £16.5 million but it was behind plan in August with £3.2 million delivered against a plan of £5.1 million.
Dr Cameron said they continue doing much work to identify opportunities to improve the situation, working with colleagues to meet the challenge head on.
Mr Rowell has developed a financial recovery plan which will be presented to the board.
SuffolkNews has highlighted some of the key issues from the board papers ahead of the meeting.
Deficit
A finance report said to achieve the planned deficit the trust would need to improve its current run rate (rate of expenditure over income) by £2.2 million per month.
It said several controls and processes have been implemented and it expects to report ‘significant improvement’ from October onwards.
The trust aims to improve the run rate to £1.3 million per month deficit by March 2025 but ‘these actions alone will not meet the plan’.
Cost Improvement Programme (CIP)
The finance report said achieving the £16.5 million programme remains a ‘significant risk’.
To achieve the target it needs to identify a further £11 million and there are 146 schemes ‘in the pipeline that will help to close this gap’.
The trust has delivered £3.3 million CIP in the year to date against a target of £5.1 million which is £1.8 million behind plan.
The papers also state that good progress has been made in implementing control measures agreed at a July Insight Committee including a non-pay control panel and controls on extra contractual work spend.
It said: “The controls are also helping identify further potential CIPs although there is a need to ensure we are not double counting between the control measures and the CIP programme.”
The NHS Suffolk and North East Essex Integrated Care Board (ICB) has introduced a double lock mechanism which requires its approval of all relevant non-pay spend over £15,000.
Any such requests will have gone through the trust’s own internal processes first.
Cash
The trust’s cash balance at July 31 was £7.6 million compared to a plan of £2.9 million.
The financial report said cash was being ‘rigorously monitored’ to ensure it had adequate cash reserves to match its expenditure.
“However, as the trust continues to report a deficit, our cash position continues to deteriorate,” it said.
To ensure it has adequate cash support, it has requested further revenue support of £6.8 million for quarter two from the Department of Health and Social Care.
It has already received £3 million for the first quarter and was awarded £4 million for quarter two.
For quarter three it has sought £17 million in revenue support, with an application made to NHS England and money from the Government.
It includes £5 million of working capital support which relates to the cash required for the trust to pay the pay award to all staff on October 25.
The financial report said: “The ICB will not be providing the trust with the full amount of cash required to pay the pay arrears in October as the trust has already received some of this cash as part of the monthly block payments.
“This cash has, however, already been used to pay the backlog of supplier payments.”
Trust’s position
WSFT said it is closely monitoring its monetary resources and prioritises the use of this throughout year with its financial and operational commitments.
The trust said it will be able to meet its upcoming financial commitments, including paying the backdated pay award to its staff in October.
There is no risk to staff pay and WSFT staff will continue receiving their salaries regardless of when the trust receives additional cash support, it said.
According to the Department of Health and Social Care, NHS providers can apply to the Department of Health and Social Care for cash support, which ensures providers in financial difficulty have the cash required to protect service continuity for patients.
As part of the cash process, providers initially make their requests to NHS England which validates requests ahead of the department’s approval.
If providers apply for cash support, they must work with NHS England to improve their financial position.
