FINANCE: Portsmouth Hospitals Trust is already exceeding its planned deficit by more than a third, reporting a £1.23m funding gap, which is £300,000 worse than the forecast figure for April 2011.
The trust has met only slightly more than half of its cost improvement plan target for April, achieving savings of £759,000, against a target of £1.45m.
According to its financial report “the major reason for this shortfall is that £403,000 of the demand management cost reduction has been phased into the target but not achievement has been registered at present”.
The trust says it is difficult to assess how effective demand management measures are before activity plans for the year have been finalised.
Also, cost improvements such as length of stay and productivity have not yet begun, though they are factored into the month one target.
The trust’s agreed contractual income for the year is £419m, significantly lower than the 2010-11 figure of £446m, because it received £19m of non-recurrent funding last year.