Yorkshire FT agrees legally binding undertakings over deteriorating finances

The regulator launched an investigation into the trust in November, when projections showed it could be around £4m in deficit at the end of the financial year, despite originally planning for a £3m surplus.

The trust’s financial position has since deteriorated further, and it is now forecasting a £5.5m deficit for the end of 2014-15.

A statement issued by Monitor said the trust’s board of directors “could have done more to prevent the financial problems from arising”.

The trust has agreed to legally binding undertakings, which includes appointing an independent turnaround director, putting a plan in place to improve its finances, and commissioning a review into the board’s effectiveness.

Monitor regional director Paul Chandler said: “The trust’s financial position is very serious and projections show it could get worse over the coming months.

“We expect the trust to make improvements quickly for its patients and we will be keeping a close eye on its performance to make sure these problems don’t happen again.”

Trust chair Andrew Haigh said it has “has already taken a number of steps to deliver on the undertakings”.

He said the trust has appointed an external interim director to “to support the board in meeting the financial challenges we face”.

“We have also been strengthening our programme management arrangements which will help us deliver quality assured cost improvement plans to make the efficiencies required and achieve a stable financial position,” he added.