FINANCE: Auditors are considering reporting Whipps Cross University Hospital to the health secretary for failing to break even last year.

The trust is still negotiating with its auditors to try and avoid being referred to Andrew Lansley under Section 19 of the Audit Commission Act.

A report from the east London trust’s finance director in June said: “This referral would be made to the Secretary of State on the grounds that the trust has not fully expunged its historical deficit and therefore has failed its statutory three-year break-even duty.

“It is unlikely the trust will avoid this referral unless it receives a written commitment soon that challenged trust board funds will be granted.”

The trust is submitting an outline business case to NHS London on its proposed merger with Barts and the London and Newham University Hospital Trust.

The strategic health authority’s capital investment committee is due to consider whether the merger should proceed from an outline business case to a full business case on 4 August.

A spokeswoman for Whipps told HSJ the trust would ask for the money from the the SHA’s challenged trust board once the outline business case had been approved.