FINANCE Troubleshooter called in to help turn around beleaguered Surrey and Sussex

Published: 24/03/2005, Volume II5, No. 5947 Page 9

Crisis-ridden Surrey and Sussex Healthcare trust is forecasting a£27m deficit this year - and could be reported to the secretary of state by its external auditors.

The zero-starred trust is now being run by troubleshooter Anthony McKeever, who was brought in after both the chair and chief executive left the trust.

Trust chair Adrian Brown stood down at the end of February and chief executive Ken Cunningham announced his early retirement to pursue other opportunities days later. Mr Cunningham had been on extended leave since early February.

Mr McKeever, co-director of management consultancy Quo Health, expects to run the trust for around six months until a permanent chief executive is appointed.

Mr McKeever told HSJ that he has identified spending on bank and agency staff as one of the key areas to address at Surrey and Sussex - expenditure has been 'getting on for£19m'.

He is also strengthening clinical leadership, holding workshops to get staff input, and looking for ways to reduce expenditure.

'There are decisions the primary care trusts took a long time ago that have not been enacted, ' he said.

Extended stays are also under scrutiny: 4 per cent of patients are taking up 48 per cent of the trust's bed base. 'I have had a list produced each week of any patients who have been in the hospital for 20 days or more. There are not many conditions that require that.' The trust's dire financial straits have been revealed over the past few weeks in its board papers and an independent report prepared for Surrey and Sussex strategic health authority.

The independent report - written when the overspend was expected to be considerably less - described a 'crisis' with temporary borrowing totalling£12m and the trust unlikely to meet its recovery plan figures.

The report showed that the deficit was presented differently to the boards of the trust and the SHA.

Author Alan Meekings said it would be 'almost impossible' for the trust to meet its statutory break-even duty in March 2006 and warned that its external auditors might refer it to the secretary of state.

The trust's own January board meeting heard that the trust was relying on 'the goodwill of our suppliers to ensure continuity of supplies and services'. Only 7 per cent by volume of bills sent to the trust were being paid within 30 days and 'weekly or monthly payment plans' had been agreed with major suppliers. At the end of November the trust had just£56,000 available in cash balances.

Questions have also been raised about the diagnostic and treatment centre at Redhill, where capacity was bought by the NHS in a groundbreaking deal in 2001. Board papers suggest it was attracting fewer patients from outside the local health economy than expected.

Financial pressures on PCTs led them to ask the acute trust to lengthen its waiting times to the government's maximum of nine months, when shorter waits had been achieved.

The larger-than-expected deficit raises questions about finances across the SHA area. The SHA has been forecasting a year-end deficit of£15.7m - but has a 'worst-case scenario' of£67.8m.

An SHA spokesperson admitted the trust's problems 'pose a challenge to the ability of the overall health economy to break-even'.