Tower Hamlets beats surplus target despite acute overspend

The primary care trust reported a year-to-date surplus of £5.8m at the end of January 2011. The predicted £6.97 year-end surplus would exceed the £4.9m agreed with NHS London.

The finance and contractual performance report for the PCT’s March board meeting said the surplus is the result of “actions of the [trust’s] budget review group and savings identified and delivered by the corporate budget holders”.

But the papers also reveal the PCT had overspent by £5m in acute commissioning so far this year, and expected that total to reach £6m by the end of the year.

Half of that total was down to Barts and the London NHS Trust. Key areas of over-performance are elective in-patients, day cases and outpatients. However, in January, the PCT also recorded a “big increase” in non-elective inpatient over-performance.

Overspend on that contract is capped at £3m for the year, but “this level of over-performance will result in a higher contracted value in 2011-12 and therefore needs to be monitored robustly”, the papers state.

The report also shows that the trust had to dip into its reserves to deliver the surplus, applying £3.5m of cash specifically identified for acute overspending, and a further £2.2m “uncommitted non recurrent reserves”.