More than one-third of all acute trusts and a quarter of all primary care trusts are receiving turnaround support as it was revealed that deficits in the NHS are climbing again.
Turnaround teams of management consultants have now been sent into 143 organisations: 62 acutes and 81 PCTs, the Department of Health told HSJlast week. When the first teams were sent in last December, they went into only 52 organisations.
The DoH's latest financial forecast revealed that 175 organisations expected to be in deficit at the end of the financial year, reporting a combined gross deficit of£1.2bn.
Finance director Richard Douglas blamed the short-term costs of PCT reorganisation and new age discrimination legislation for the shortfall. Money will be clawed back through surpluses at high-performing organisations and by pruning more from training budgets and public health funds.
He said the level of gross deficit and the number of organisations in deficit was 'a cause for concern'.
It had originally been intended that turnaround teams would stay with trusts for 18 months, but Mr Douglas told HSJthat some could stay longer.
'My view is that there will still be some organisations that will need turnaround support [over the coming months],' he said. 'But we expect some of the skills to be embedded in the organisations by now.'
Of the 143 organisations with turnaround status, 108 are designated 'high priority'. No fewer than 30 are in NHS East of England, which includes the troubled Bedfordshire and Hertfordshire area; and 22 turnaround teams are working in NHS South Central, which includes Surrey and Sussex. London has 25 teams.
HSJunderstands that a review of turnaround teams will take place over the next two months, with some being withdrawn.
The DoH quarter two report shows that the financial situation has deteriorated significantly from the position three months ago when only 120 organisations were forecasting a deficit. Of the 175 organisations now forecasting deficits, 119 of them are PCTs (on their pre-reorganisation boundaries). The number in debt has almost doubled over the past three months, and their forecast gross deficit is actually higher than the PCT gross deficit at the end of 2005-06.
The DoH has pledged to bring the NHS to net balance by the end of the financial year, but the latest forecast is for a net deficit of£94m, down from a forecast£18m surplus three months ago.
However Mr Douglas still maintains that the NHS as a whole can achieve balance by the end of the year. He said the forecast net deficit should be wiped out by£100m worth of savings to training funds and to some Choosing Health money.
He is also hoping that the reduction in costs of some generic medicines as part of the pharmacy contractual framework will save PCTs a further£150m. But he expressed concern that trusts have not factored in the cost of age discrimination legislation, which could hit£70m.
The DoH also aims to ensure that as many organisations as possible are spending within their means on a month-by-month basis. But currently 210 organisations - 41 per cent - are not reaching this standard.
King's Fund chief economist Professor John Appleby said the DoH needed to bring the gross deficits down.
'Surpluses are being used to offset deficits elsewhere and it means there will be lots of organisations that haven't tackled the underlying reasons why they went into deficit,' he warned. 'The tactic is clear: take the money and ask questions later.'
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