Updated: Major London trust chair resigns as trust put into financial special measures

Bob Kerslake announced today he was stepping down as chair of King’s College Hospital Foundation Trust, ahead of it being placed into financial special measures. NHS Improvement announced that the trust was being put into financial special measures on Monday afternoon.

The former permanent secretary of the Department for Communities and Local Government and head of the civil service wrote in The Guardian: “After two years of delivering or getting close to the deficit target agreed with our regulator NHS Improvement, King’s has moved significantly away from its planned figure for this year. We’re far from alone – almost every hospital in London is struggling – but the scale of the deficit and the change means that we will be put into financial special measures.

“The Secretary of State and the regulator normally extract a price for this at the top and King’s will be no different. We could fight back, but this puts King’s future at even greater risk.

“The right thing for me to do therefore is to step down and to do so publicly.”

Lord Kerslake’s comments come as the departing NHS Improvement chief executive Jim Mackey criticised the trust over its financial performance. In his exit interview marking his departure as NHSI chief executive, Mr Mackey told HSJ “you would have expected more” from the organisation’s leadership - singling out chief executive Nick Moberly.

He said he was frustrated in his efforts to help King’s College Hospital FT improve its position because the organisation “hasn’t hit a single number that they’ve put to us in the two years I’ve been involved in NHSI”.

Mr Mackey added: “They have been various forms of escalation that haven’t improved their position, and that’s going to have to be addressed.” The interview was carried out on 7 December.

In November the organisation’s chief operating officer and finance director both resigned ahead of the board meeting.

At that meeting Lord Kerslake hit out at the central management of NHS finances, and the system for allocating capital in particular, saying “You would not run a fish and chip shop this way”.

A Care Quality Commission report on the trust is expected soon.

Baron Kerslake took the unusual step of publishing the part of the CQC’s draft report concerning his performance as chair.

It said: “The chair was held in very high regard by staff at all levels. It was apparent the chair had gained the respect of staff with people reporting their approval at how the chair promoted the highest level of probity and governance and of how he demonstrated the organisation’s values and behaviours.

“Under his leadership the shape of the board was said to have changed to one where the right skills and vision was present at board level.”

On Monday NHS Improvement announced the trust was being put into financial special measures and interim chair appointed. Ian Smith, who was chair of Four Seasons Healthcare Group until last year, will be interim chair.

Chief executive of NHS Improvement Ian Dalton said: ”The financial situation at King’s has deteriorated very seriously over recent months and we have now placed the trust in special measures to maximise the amount of scrutiny and support that it receives.

”We understand that the wider NHS faces financial and operational challenges, and other trusts and foundation trusts have large deficits. However, none has shown the sheer scale and pace of the deterioration at King’s. It is not acceptable for individual organisations to run up such significant deficits when the majority of the sector is working extremely hard to hit their financial plans, and in many cases have made real progress.”

NHS Improvement said the King’s Board had earlier this year agreed a budget deficit of £38 million for 2017-18 and in late October had “formally worsened this prediction to £70 million”. NHS Improvement said last week the trust had re-forecast again to an end-year deficit of £92 million. The trust’s chief executive Nick Moberly said when he took the job the underlying deficit was £140m and his team had reduced this to around £100m.

HSJ reported the £100m+ underlying deficit in Septmeber 2016.