Shropshire Star

Shrewsbury and Telford hospitals heading for £15m deficit

Shropshire's two main hospitals are on course for a disastrous £15 million overspend unless "corrective action" is taken urgently, it was revealed today.

Published

Shrewsbury and Telford Hospital NHS Trust had forecast it would be more than £8m in the red by the end of the financial year in April 2015. But a report going before board members today shows it is already more than £4m in deficit after the first quarter to June this year.

This is an overspend of nearly £1.5 million against the strict budget. Health chiefs are set to borrow nearly £2 million in August in a desperate bid to get back on track and have issued a plea for longer-term help to the NHS Trust Development Authority, which oversees all health trusts.

High numbers attending the accident and emergency departments at the Royal Shrewsbury Hospital and Telford's Princess Royal and a dependence on expensive agency staff are being blamed for the crisis.

Figures show on average more than 300 people a day are turning up at A&E at the two hospitals, many with minor ailments.

But the main overspend is on pay. The trust had budgeted £51.58m on wages from April to June but in fact spent £53.5m.

The report shows the trust should have been £2.83m in the red by the end of the first quarter of 2014/15 to meet the £8.2m deficit target. But it is overspending by £4.26m. In the report, trust chief executive Peter Herring says: "Without corrective action the out-turn deficit could approach £15m and rectification plans to deliver the financial plan are clearly required.

"It is unreasonable for the trust to bear the additional costs associated with maintaining escalation capacity arising from the huge rise in emergency admissions, and a case will be made to commissioners to release the residual 70 per cent retained by them for excess emergency activity.

"A medical workforce strategy to minimise the premium costs of agency is being developed. The pay bill continues to be above budget – this is predominantly due to high reliance on bank and agency across nursing and medics.

"Efforts to reduce the rate of nurse overspend have been unsuccessful to date and a more focussed strategy to reduce agency premium and control over-establishment is being developed.

"Temporary borrowing of £1.9m in August is being obtained to support the cash position whilst a permanent solution is secured from the NHS Trust Development Authority."

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