FINANCE: Plymouth Hospitals Trust is forecasting to break even at the end of the year despite reporting a £4.6m deficit.

In its original budget the trust planned a surplus of £0.3m at the end of December 2010. However, the trust is reporting a deficit of £4.6m, an adverse variance of £4.9m.

Despite the overall position December saw an improvement in the trust’s income and expenditure of of £0.8m due to additional contract and non-recurrent income.

This year to date position is in line with the Trust’s recovery plan that was agreed with NHS South West and the trust continues to forecast the delivery of a break even position by the end of the financial year although acknowledge there are some significant risks.

The finance report to the board lists the key areas of variance as:

i. Income is £6.4m ahead of plan
ii. Pay is £2.9m over budget to the end of December.
iii. Non pay expenditure is £2.1m over budget. Of this number £1.6m relates to under delivery of planned cost improvement programmes with the residual caused by in year cost pressures and activity variations.
iv. Depreciation and interest charges are £0.5m higher than budgeted.
v. CIP schemes still to be identified against the original target total £5.8m year to date