FINANCE: The primary care trust reported a breakeven position after the first two months of the year, but had to use contingencies to avoid a deficit.
At the end of month two, May, the overall performance for NHS West Kent was breakeven compared to the planned surplus of £0.167m, according to a finance report published by the Kent and Medway PCT cluster. The position before the use of contingency was a £4.5m deficit.
The report stated: “The year to date position in the board report represents a shortfall against plan but there remains a commitment to deliver the plan and therefore an amount of contingency has been employed on a temporary basis and this will need to be recovered in the remaining months of the year.”
It added: “The pre-contingency overspend mostly reflects the £17m local acute trusts quality, innovation, productivity, and prevention (QIPP) plans, achievement of which cannot be validated at this time.”
Overall the PCT has a QIPP target of £38m which is described as “high risk”. Added to this is an “exceptional challenge” relating to recurring costs of around £20m associated with the new Pembury hospital.
The report also warns that NHS West Kent lacks “mitigations” to cover failure to achieve targeted QIPP savings.
It said: “Each PCT has challenging plans to deliver QIPP. However for two of the PCTs there is a balance of mitigations that is likely to be more than adequate. These include a level of planned investment, which can be slowed down or deferred, balance sheet flexibility and contingency reserves.
“West Kent PCT does not have the same mitigations as the others and the ability of West Kent to absorb sub-optimal delivery of QIPP or any other adverse movement is absolutely limited to contingency.”
It adds: “There is evidence of QIPP achieving good things with promising results from a few groups and individuals, but there are also plans being deleted or downscaled… The level of risk is extremely high for West Kent.”
Cluster finance report (see attached, right)
20 July 2011