Trust chiefs hit back at claims of overspending on staff

One told HSJ the national regulator had made a mistake or that its methodology was “totally flawed.” Another said their trust would continue to recruit staff to help cope with a 16 per cent increase in activity.

One trust director told HSJ that achieving the revised savings wanted by NHS Improvement would mean a 10 to 15 per cent reduction in staff while another said the control totals wanted by NHS Improvement were “financial castles built on sand.”

Sixty-three provider trusts were named as having over-recruited by NHS Improvement today as part of its joint financial re-set with NHS England.

It said all of the trustshad seen growth in their pay bill since 2014 which had exceeded inflation. The document gave no details as to whether NHS Improvement had considered the historical staffing levels at the trusts or increases in demand activity.

NHS Improvement has refused to answer questions about the methodology it used. 

Karen James, chief executive of Tameside Hospital Foundation Trust, which faces one of the largest penalties for its paybill growth at £14.4m told HSJ she believed NHSI had made a mistake and failed to account for the new community services it had taken on.

She said: “I don’t see that this can be an accurate reflection of the situation because we are trying to recruit. I can imagine the methodology is totally flawed, we are not over-staffed whatsoever.

“We haven’t got the workforce to deliver what is required of us and therefore we are recruiting staff to meet the required standards that are set nationally. We are not deviating from any national requirements, we are trying to meet them.”

If the trust was forced to save an additional £14m she said it would have “huge implications” adding: “The organisation would not be able to operate in its current form to deliver services that are required.”

Mid Cheshire Foundation Trust is facing pressure to save an additional £5.1m which could be added to its control total for the financial year.

Chief executive Tracy Bullock told HSJ that reducing staff would come at the cost of quality of care and said NHS Improvement appeared not to have considered the trust’s increase in activity or its historical understaffing.

“Reducing staffing costs would be detrimental to the safety and quality of care we are able to provide and as such would simply serve to increase agency usage to maintain that safe care.

“Much of the investment is as a result of CQC requirements, transfer of therapy staff to the trust, measures to address historic understaffing. Our nurse staffing is now described as ‘adequate’ by the CQC but medical staffing is still below the correct number of doctors per bed.”

She added: “Over the two year period in question the trust has seen a 16 per cent increase in activity and has had to respond to that to meet the needs of patients.”

She said reducing staffing was not the right answer for the trust.

Another trust director told HSJ: “We looked at the revised total [NHS Improvement] wanted us to hit and it would involve losing somewhere between 10 and 15 per cent of our staff. We can’t set a responsible budget like that.”

One finance director at an acute trust told HSJ: “There won’t be any workforce cuts here. We won’t be safe. I know some finance directors who signed up to control totals that they know they can’t meet. They are financial castles built on sand.”

Alwen Williams, chief executive at Barts Health Trust, which faces a £14.7m penalty for over recruitment and has been placed in financial special measures said the trust would continue recruiting to permanent roles.

She added: “Providing quality healthcare is labour-intensive, and like all other NHS hospitals, the biggest single element of our finances is the wages and salaries of our doctors, nurses and support staff. This accounts for over 60 per cent of our annual turnover of £1.4bn. Recruiting and retaining sufficient numbers of clinical staff is crucial to maintaining the quality of our services to patients.”

Norfolk and Norwich University Hospitals FT chief executive Mark Davies said the trust had seen demand “rising relentlessly and we are treating more patients who require more complex care from a large geographical area. Our staff are doing an amazing job but they are under significant daily pressure which is not sustainable.”

In a statement issued to HSJ on the wider NHS financial reset John Goulston, chief executive of Croydon Health Services Trust said his organisation’s deficit had increased because the trust had invested in raising standards of care including recruitment of more than 100 nurses for positions currently covered by agency staff.

Asked what the trust would do to reduce spending he said: “Across the trust we have asked staff to flag where we can work smarter and cut costs – but we will not take a backwards step on quality.”

The reset document, explaining its list of 63 providers, said: “Analysis of 2015-16 cost trends and 2016-17 plans indicates significant growth in excess of inflation and pension effects in 63 providers totalling £356m on a part-year basis. NHS Improvement is working to support these providers to identify by the end of July how much of the planned growth can be eliminated and how far they can reverse the often unplanned and unmanaged cost growth that occurred in 2015-16.

“Some of the reported growth will doubtless reflect structural factors and genuinely unavoidable investments, including in the context of CQC inspection findings, and the analysis is based on plan submissions before final control totals were agreed with some providers. However, this review process will result in a ‘dial back’ of excess cost growth where this is possible, including reductions in agency staff, resulting in reduced levels of deficit across the provider sector.”

This story and its headline were updated on 28 July to clarify that NHS Improvement has said that trusts may have overrecruited or be overspeding on staff, but not that they necessarily have.

On 29 July we published a new piece, Mackey: Pay bill growth list was ‘intended to start a discussion’, after NHS Improvement provided an additional statement on the issue.