• East and North Hertfordshire Trust fined £605,000 over three years
  • Several trusts have reported late payments to suppliers due to cash flow problems

A £412m turnover hospital trust has been fined more than £600,000 over the late payment of a supplier in the last three financial years.

East and North Hertfordshire Trust has the highest total in England for NHS trusts fined under the Late Payment of Commercial Debts (Interest) Act 1998 over this period, data published by NHS Improvement shows.

The trust set aside £77,000 in 2014-15, £332,000 in 2015-16 and £196,000 in 2016-17 for claims under the legislation.

Over the past two financial years, NHS trusts have lost £938,000 in total under this legislation. Foundation trusts are not obliged to disclose this information.

East and North Hertfordshire Trust would not say what the total debt was or what it related to – but said it was a dispute with one large supplier.

A spokesman said: “Like many NHS organisations currently, the trust is working to recover its financial performance position and we continue to work closely with all of our suppliers to manage expectations and timelines with regard to payments. In doing so, we have sought to prioritise payment to small and medium sized local suppliers wherever possible.

“The information published by NHS Improvement recently relates to one very large supplier of services used by the trust; we are seeking discussions with them to secure a mutually acceptable way forward.”

The trust has a number of legal claims outstanding that might account for the sum, according to its annual accounts.

These include: “potentially over-recovered VAT” about which it has made a voluntary disclosure to HM Revenue and Customs, a “provision around carbon trading units” and “a provision made for the trust’s potential share of negative net assets in the Pathology Partnership relating to prior years”.

The news comes as several hospitals report late payments of suppliers as cash shortages start to bite.

HSJ reported last month that one in four trusts routinely pay their suppliers late.