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Cash crisis for health groups

PUBLISHED: 00:52 11 August 2002 | UPDATED: 12:27 03 March 2010

Health organisations in Suffolk are predicting a combined financial overspend of £7 million by the end of this financial year.

The cash crisis affects all five primary care trusts, the two hospital trusts and the Local Health Partnership NHS Trust, which deals with community health services in the county.

Health organisations in Suffolk are predicting a combined financial overspend of £7 million by the end of this financial year.

The cash crisis affects all five primary care trusts, the two hospital trusts and the Local Health Partnership NHS Trust, which deals with community health services in the county.

Although the predicted overspend is only about 1.3per cent of Suffolk's annual NHS budget of £520m, government guidelines describe any health organisation with a shortfall of more than one per cent of turnover as "significantly underachieving" in their financial management.

The figures came to light after senior managers called for a review of finances following the reorganisation of the NHS at the beginning of April.

That saw the Suffolk Health Authority replaced by five primary care trusts and the introduction of a strategic health authority covering Norfolk, Suffolk and Cambridgeshire.

Managers felt the move exposed weaknesses in overall financial planning and monitoring.

Much of the predicted overspend has been down to inherited deficits from last year and the spiralling cost of prescriptions caused by a large increase in the price of drugs – as much as 16pc in some cases.

Each health organisation will try to balance their books in different ways. Cost-cutting measures could include the sale of surplus land, new developments being delayed and slowing the recruitment of non-clinical staff.

Representatives of the Suffolk primary care trusts and NHS trusts admitted they were worried about the predicted budget deficit, but sought to reassure people the quality of patient care would not suffer.

Brian Parrot, who chaired the financial review and is chairman of Central Suffolk Primary Care Trust, said: "This news is not a surprise and, along with other primary care trusts and the hospitals, we will be look at ways to find financial balance."

Christine Smart, chairman of Ipswich Hospital, added: "We are absolutely determined to work in partnership with all our colleagues in health and social care to make sure we take the action that is needed to put us back in financial balance.

"We will continue to provide high-calibre hospital services for local people and will minimise the impact on any patient care or service."

Her sentiments were echoed by John Parkes, chief executive at West Suffolk Hospitals Trust, who said: "A lot of work has already been undertaken between the trust and Suffolk West Primary Care Trust, which has identified a number of efficiency schemes that will not have an impact on patient care."

Joanna Spicer, chairman of Suffolk West Primary Care Trust, said: "Our recovery plan is still under way and we hope to have our overspend down quite a bit by the year end.

"I am very confident that this will not affect clinical services in the west of the county. We do remain very concerned about the overspend on prescribing and are working with GPs to try to limit that."

She added any year-end deficit would have no affect on the proposal for a new hospital in Sudbury, which is on course to be built in 2005.

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See page 21 to see how one doctor's dream of funding came true.

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