FINANCE: Plymouth Hospitals Trust is seeking “exceptional” permission from the NHS Trust Development Authority as it expect to return to financial balance in five years instead of the usual three.

The £405m turnover trust finished 2013-14 with a deficit of £13m after receiving £13m in financial support from the Department of Health to help with its cash flow. Plymouth is forecasting an identical position this year.

Under NHS accounting rules trusts are required to break even over a three year period.

Notes to the trust’s annual accounts, published last month, say a financial plan is under development to return to “an annual surplus in as expeditious a timeframe as possible”.

They add: “However, it is unlikely that the trust will meet its statutory duty to achieve an overall breakeven position over a three year period and it will probably require an exceptional extension to a five year period.”

The trust introduced strict spending controls last year, restricting recruitment, use of bank and agency staff and non-essential spending such as training for staff.

Finance director Joe Teape told HSJ the trust had requested an extension to the break-even duty from three years to five.

In order to avoid a breach, the trust would need to recover the deficit and make £14m of surpluses in the three years 2015-16, 2016-17 and 2017-18.

Mr Teape added: “In terms of sustainability our current draft plans assume we get back to break-even in the year 2016-17, although clearly this remains very challenging given our current £13m deficit plan.”

The accounts said despite its financial position the trust was a “going concern” as it “remains and is expected to remain the principal provider of secondary healthcare services for the population of Plymouth and surrounding areas”.