FINANCE: University Hospital of North Staffordshire is likely to need more cost cutting plans in order to remain “financially viable” next year.
Board papers said if 2011-12 income is in line with the 2010-11 service level agreement of £331m, the trust will need to reduce costs by 9 per cent to less than £32m per month by April 2010.
Average costs for the year to date are averaging £34.6m and the latest forecast is not showing any reductions in total costs.
However, the papers state: “Realistically, it is highly likely that the 2011-12 SLA will be recurrently lower than the 2010-11 outturn.”
This means significant efficiency improvements will be required across the organisation, some specialties are likely to see significant reductions in activity requiring significant capacity reductions, and the trust may need to cut costs before surplus capacity has been identified.
It warns: “We do not currently have sufficient plans to achieve this reduction and without them the trust will not be financially viable next year.”
However it notes that an efficiency planning event took place on 31 January to assist the clinical divisions in developing additional plans.
4 February 2011