FINANCE: The high cost of private placements is causing concern for Manchester Mental Health and Social Care Trust – and its commissioners.

The cost is likely to be £2.9m this year and with no risk sharing agreement in place the trust and NHS Manchester are likely to end up in arbitration over who pays for this.

The trust – which is applying for foundation trust status – wants to make a surplus of £1.1m this year and was slightly behind plan at the end of December with a surplus of £611,000. It is also likely to underachieve on its cost improvement plans by £2.7m, although this is mitigated by other savings.

However, the risk that financial pressure impacts on its FT bid is recognised as significant, with a risk rating of 20 (25 is the maximum).