NHS hospital trust warned it could be declared bust

Posted 25/06/2012

The health secretary has warned South London Healthcare that an administrator could be brought in within weeks, possibly to dissolve the Trust and close some services. Patients have been reassured that services would run normally until a decision was made. This move of dissolving an NHS Trust breaks new ground and may act as a warning gesture for all those NHS trusts which are struggling.

South London Healthcare Trust was formed by the amalgamation of the Princess Royal University Hospital in Orpington, Queen Mary’s Hospital in Sidcup and the Queen Elizabeth Hospital in Woolwich in 2009. Upon merger they inherited a large debt. In recent years, the deficit has become increasingly worse, reaching the high of ?69m at the start of this financial year on a turnover of just over ?424m. The Trust also has some of the longest waiting times for operations, and longer than average waits in A&E. However, it does have low infection and death rates.

It has been suggested that if a decision was made to break up the Trust, it would not necessarily mean the closure of all services. Another more successful NHS organisation or private provider could end up taking over some of them. Ministers are also thought to be considering a rescue deal for the Trust which would involve the taxpayer taking over responsibility for the ?2.5bn PFI contract the Trust signed up to for the two new hospitals.

There have always been individual organisations in the health service which have struggled financially, but in the past they have been bailed out by other parts of the NHS. However, the Government has signalled its intention to change this culture and this move may act as a “wake up call” to other struggling trusts.

Sophie Bales, medical injury solicitor at Ashtons Legal comments: “This move is the first of its kind and suggests that the Government are starting to tackle the financial problems affecting some NHS Trusts.

The long-term future of the NHS will depend on its financial stability and security. Therefore, any move towards financial sustainability is a positive step for the long-term future of the NHS. It should also improve patient care in the long-term as financially healthy trusts are better placed to provide consistent services and care for their patients.However, it is equally as important that any financial measures do not prevent patients from receiving services in the short term. Any financial reorganisation must be considered with consistent patient care as the primary objective.”