Government scraps 'pipeline' deadline to become a foundation trust

The response to the Future Forum also offered no further guidance on a failure regime and extended Monitor’s regulation of FTs until 2016.

The April 2014 drop-dead date has been abandoned with the response document saying: “It will not be an option to stay as an NHS trust, but there will no longer be a blanket deadline in the bill for abolishing NHS trusts as legal entities.”

Instead organisations must become foundation trusts “as soon as clinically feasible, with an agreed deadline for every trust”.

There are 137 foundation trusts with 116 other trusts still to go through the authorisation process.

Foundation Trust Network director Sue Slipman warned: “If we lose the ‘drop dead’ date it will dissipate focus.

“FTN believes that the government should keep it but allow an exceptions regime where trusts can demonstrate that they could be viable for authorisation within a short time of the final date through a vigorous business case agreed with the national provider agency.”

A lawyer from a firm that advises trusts looking at mergers and acquisitions as a way of gaining FT status told HSJ: “It takes some of the pressure off a snap merger that there might otherwise have been - especially for the trusts with no obvious partner.

“It may give a bit more time for people like Weston [Area Health Trust, in Somerset] or George Eliot [Hospital NHS Trust, in Warwickshire] to look at what their options are.”

He added that the problems at the stricken care home provider Southern Cross could see the government consider a financial stability element to licensing providers providing designated services.

Martin Munro, a partner at KPMG who works mainly on projects in London, said: “For some, there is simply too much to do to make the changes to make them into (or part of) well governed, clinically and financially sustainable organisations.  The challenge, as ever, is how to maintain focus and a sense of urgency when there isn’t a hard deadline.”

The chief executive of a trust in the pipeline told HSJ: “‘As soon as clinically feasible’ is quite open-ended phraseology. They have gone further than I expected in easing the deadline.”

The response document said there were “concerns about the practicality” of the plan to create “designated services”, whose operation would be guaranteed by Monitor but for which commissioners would pay a premium. The bill would be amended accordingly.

The original bill envisaged disputes between commissioners and providers over the designation of services being settled by a tribunal.