Matthew Kershaw has today been confirmed as trust special administrator at South London Healthcare Trust.

The Department of Heath’s director of provider delivery will officially start work in the role on Monday, assuming the functions of the trust’s chair and chief executive.

He will be responsibile for running services and coming up with a longer-term plan for the trust, which recorded a deficit of more than £65m in 2011-12.

He must produce a draft report to be laid before Parliament on 29 October and then oversee a consultation on the draft, which will conclude on 14 December.

The final report, with recommendations for the future form of the trust, will be submitted to health secretary Andrew Lansley by 8 January 2013. Mr Lansley must make a decision by 4 February.

The trust is the first to be formally put into the failure regime, using 2006 legislation. However, HSJ reported last week that the move was being considered for Mid Yorkshire Hospitals Trust.

Chief executive Chris Streather resigned last month after leading South London from its creation from three smaller trusts in 2009.

NHS London boss Ruth Carnall revealed to HSJ last month she had wanted a solution across the whole of south-east London in 2009, rather than just the outer boroughs, but had compromised in the face of resistance.

A tender is out for the formal support of Mr Kershaw in his work, and is expected to go to one of the large consultancies.

The DH also announced Mr Kershaw would be supported by “a dedicated expert team including an independent clinical panel as well as NHS and external strategic advice. In particular, he will bring together a clinical advisory panel”.

As DH director of provider delivery Mr Kershaw was responsible for pushing the 100 non-foundation trusts through the foundation trust pipeline by April 2014, a target the government has now conceded will not be met. It is not known if Mr Kershaw will retain his DH role.

Solutions for South London Healthcare are widely thought to include Oxleas Foundation Trust taking over one of the three sites, with the King’s Health Partners, which includes Guy’s and St Thomas’ and King’s College Hospital foundation trusts, looking at the other two.

Staff were sent a letter this week saying South London was not aware of any bid from private operators Circle but that it was a “possibility”.

Mr Lansley said: “Past efforts have not succeeded in putting the South London Healthcare Trust on a sustainable path.

“Although there have been some improvements in mortality rates, maternity services and infection control, and some early signs of improvements in waiting times, they do not go far enough.  It will be impossible for South London to build on these improvements while tackling such a large deficit.

“Matthew, working with clinicians, all other staff, commissioners, patients, the public and other stakeholders, must now drive the changes and shape a sustainable solution for South London Healthcare Trust and the local health economy.”

“Matthew has extensive senior leadership and management experience within the NHS at board level in acute hospitals, and as a former chief executive in a high-performing foundation trust.”

In a statement Mr Kershaw said: “My priority is to work with staff, patients, the public and all those involved in healthcare services in the south east London area to maintain high quality, effective services during the running of the unsustainable provider regime. 

“This means developing recommendations that ensure that people in south east London can access high quality, safe, and financially sustainable services for the long-term. Together we will need to think differently, be bold and accept that change needs to happen. The status quo is not sustainable.

“There have been some recent improvements in clinical standards at the trust but these are not being delivered within budget. The trust is overspending by £1.3m each week, meaning vital resources are being diverted away from other services and communities.”