FINANCE: Royal Cornwall Hospitals Trust is aiming to make savings of £19m during the coming financial year in order to achieve a surplus of £4.4m.
The savings plan is equivalent to a reduction of 6.2 per cent, which is greater than the 4 per cent total set out in the NHS operating framework for 2011-12 and does not include a headroom target.
The trust’s total projected gross income for 2011-12 is circa £305m, a reduction of £3m on the the current year.
Income from NHS Cornwall and the Isles of Scilly is expected to make up £270.7m of this but is reliant on the trust “addressing its waiting list backlog in four ‘challenged’ specialities including orthopaedics and gynaecology.”
The financial plan assumes the Department of Health agrees to reschedule a loan due to be paid off by the end of 2012-13 over a five year period.
The plan states: “Of the £4.4m surplus it is assumed that circa £2m will be required to service the rescheduled loan (depending on terms of agreement with DH) and that the trust would create a circa £2.4m surplus to utilise itself for strengthening its cash position.
Going forward it is estimated the increase in savings required through ongoing tariff reductions and inflationary pressures will be at least 5 per cent pa (on the current cost base) or circa £14m per annum from 2012-13.”
31 March 2011