A leading teaching hospital is forecasting a £60m deficit this financial year – nearly four times its control total.
Brighton and Sussex University Hospitals Trust’s board was told in a report today that it already had a deficit of £23.7m after six months and its forecast deficit was being increased to £59.7m.
Previously the trust had said it expected to meet its £15.6m control total for 2016-17.
The new forecast includes a shortfall of nearly £11m in the trust’s cost improvement plan, a similar amount that it expected to get from the sustainability and transformation fund, which it will now not receive as a result of missing its targets. A further £21m came from of “other pressures”. The remaining risks to the forecast – mainly from income pressures – are still over £17m.
The trust’s cash flow is also under pressure and it had to take out a working capital loan of £9.9m this month, which will have to be repaid when the trust receives money from its clinical commissioning groups for 2015-16 activity, which is still being finalised.
In the report, deputy chief financial officer Bill Stronach said: “The trust’s cash position remains very difficult and is dependent on revenue deficit funding from [Department of Health] to cash back the revised forecast deficit.
“The increased revenue deficit together with the working capital shortfall has placed further pressure on creditor payments and increased the backlog of overdue creditor accounts.”
The trust was placed in financial special measures earlier this month, after the board warned NHS Improvement it was no longer credible to agree it would meet the control total. A meeting with NHS Improvement was held this week.
Board papers say “enhanced controls” are being considered for the rest of the year, which should reduce its run rate.
Trust board report
27 October 2016