Nine foundation trusts have 'significant concerns' over whether outstanding bills will be paid by primary care trusts. The trusts are warning that £28m might have to be written off.

The figures were revealed in the preliminary financial results for foundation trusts for 2005-06, published by regulator Monitor this week.

However, Monitor chair Bill Moyes says he has 'every confidence' that the trusts are being 'unnecessarily prudent' in their accounting and will see a 'significant' drop in the level of provision by the time full audited accounts are published in July.

'We do not believe the Department of Health would allow PCTs to fail to honour their debts,' said Mr Moyes.

He added that he had 'full confidence' in the guidance set out in the DoH's operating framework and code of conduct to ensure that any disagreements were settled and bills paid.

'I'm genuinely confident that the new strategic health authorities know their job is to make sure PCTs commission effectively and work within government policy,' said Mr Moyes.

'I'm also confident that foundation trusts know they have to live within the rules set by the government and Monitor,' he added.

However Foundation Trust Network director Sue Slipman asked why Mr Moyes was expressing such confidence when 'some PCTs are not only refusing to pay their bills but won't take part in dispute procedures as well'.

She said she was happy the right guidance was now in place, but 'we've yet to see how it bites'.

'We've clearly got PCTs that are not yet fit for purpose and do not quite understand their role. It is up to the DoH to demonstrate they will get them there as soon as possible,' she said.

The preliminary figures show that foundation trusts are set to report a net deficit of£8m - or£24m if asset depreciation is taken into account. University College London Hospitals foundation trust is heading for a£36m end-of-year deficit.

Mr Moyes said Monitor would not get involved despite having put UCLH on its highest risk rating more than six months ago. 'Monitor should not intervene if the trust is doing all the right things to address its problems,' he said.

'UCLH is strengthening its senior management team, it has appointed KPMG to provide support and it is on course to deliver its recovery plan to drop to a financial risk rating of three by the end of 2007-08,' he said.

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