FINANCE: The trust was reporting a deficit of £587,000 at the end of December, despite securing an extra £10m in funding from NHS North West to “support strategic change”.
The trust’s financial statement for that month, three quarters of the way through the financial year, included a proportionate sum of £7.5m of the extra funding.
The extra money made a significant improvement to NCUH’s bottom line, compared with the £7.4m deficit it reported at the end of September, but was not enough to bring it back into the black.
The February finance report said the main reason for the trust’s deficit was a huge shortfall in its “cost improvement” savings plan. At the end of December the plan had saved just £7.1m, compared with planned savings of £15.8m to that point.
The report added: “Pay is overspent by £734,000 in December and is now cumulatively overspent by £2.5m. Whilst pay is overspent, the run rate has reduced in December reflecting the continuing reduction in staff paid during the year.
It added: “Expenditure on substantively employed staff is cumulatively underspent by ￡2.5m due to reduced headcount compared to the budget but this is compensated by unbudgeted expenditure on premium agency staff of ￡5.1m.”
8 February 2011