FINANCE: Mid Yorkshire Hospitals Trust is forecasting a £20m deficit for 2011-12, despite receiving £14m additional support from commissioners.

NHS North of England board papers said the NHS Yorkshire and the Humber trust sector would be in overall surplus if it were not for Mid Yorkshire.

Reporting on the situation at the end of November, Mid Yorks has a current overspend of £10.8m, and projected year-end overspend of £19.7m.

The total overspend of the region’s NHS trust sector is £7.3m, and its projected end-year overspend is £10.3m.

The board paper says of the situation: “The trust is dealing with a range of service and financial performance issues, and these are being overseen by a health economy foundation trust programme board, with involvement from the SHA.

“At plan stage, the two main elements of the challenge in 2011-12 were delivery by the trust of a £30m cost improvement programme, and agreement across the health economy of an approach to meeting an additional in-year financial gap of £14m.

“The financial impact of a significant employment tribunal, ruled against the trust but awaiting a remedy hearing, was also a known but initially unquantifiable issue. Commitment to resolve the £14m gap has now been given by the PCT Cluster (Calderdale, Kirklees and Wakefield) and it has also entered into discussions with the trust around firming up projected contract overtrades.

“Nevertheless further work within the trust, including a review commissioned by the new director of finance from an independent firm of accountants, has identified significant shortfalls in the projected CIP delivery figures, as well as other budgetary and in-year pressures.

“This, in addition to an estimated £4m-£5m significant impact relating to the ET remedy decision led the trust to declare a forecast deficit of £19.7m. The actual ET remedy decision has since been announced at £4.5m which falls within the estimated range and therefore has no material impact on the forecast position.

“The SHA will continue to work with the trust, and the PCT cluster, to validate and address the position. Further work will also be required to assess the impact on the trust’s plans for 2012-13 and beyond.”