Financial blunders revealed by hospital

MORE details of the string of accounting errors that could threaten hundreds of jobs at Ipswich Hospital have emerged today.Blunders made by the hospital include carrying out more work than they were paid for by the primary care trusts, and mistaking a one-off payment for something they would be getting every year.

MORE details of the string of accounting errors that could threaten hundreds of jobs at Ipswich Hospital have emerged today.

Blunders made by the hospital include carrying out more work than they were paid for by the primary care trusts, and mistaking a one-off payment for something they would be getting every year.

The next few months will be anxious ones for hospital staff as the final number of jobs affected by the financial crisis is unlikely to be revealed until September.

Andrew Reed, chief executive of the hospital has refused to speculate on exactly how many jobs could be lost, but has vowed measures are being put in place to stop such mistakes happening again.

He said: “The good news is that these are things that are easy to put right, but the bad news is obviously that they should never have happened in the first place.

“The slippage has been a big shock to the trust and we have been anxious, in advance of any recommendations the auditors might make, to confirm the problems and put them right.”

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A team of auditors were called in to assess the mistakes in May when it was revealed that the hospital's debt was £7m worse than first thought - taking it from £4.9m to £11.9m.

Their report is due to be finalised by the end of next week.

Mr Reed said: “We've basically said to them 'we think the following things went wrong' and asked them to look in detail at the problem to ensure that we are not missing anything.”

He said one of the biggest problems was around the contract that the hospital have with the primary care trusts.

This sets out how much work the PCTs will pay the hospital to do during the year, but a number of errors in the hospital accounts department meant this was not kept to last year.

Mr Reed said: “We did more work than we were paid for.

“There was also at least one significant item that was put in on a recurring basis but was allocated to us on a non-recurring basis.”

This means that a one-off payment for the year was wrongly categorised as a payment that would be made to them every year.

In order to pay back the existing debt and not overspend again this year the hospital will have to find savings of around £25m, meaning the original figure of 105 redundancies, announced before the true extent of the debt was revealed, could now be much higher.

Mr Reed said: “We will need to increase our savings plan because of the slippage in the financial position.

“70 per cent of our costs are people so this will affect posts at the hospital but we will do our very best to avoid compulsory redundancies where we can.”

The auditors' findings are due to be presented to the trust's board at their next public meeting on July 27.

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