King’s needs to make £86m savings in one year

Admin (06 August, 2015)

Trust battling debts since taking over Princess Royal hospitals

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King’s hospital Trust has circulated a memo to its staff asking where they can make cutbacks, as it revealed £86million of savings were needed in this financial year just to balance the books.

The King’s College Hospital Trust document describes last year’s deficit of £47million as “the greatest financial challenge the Trust has ever faced,” which will have “a huge impact” on the services it can offer.

Until recently the Trust had a small surplus at the end of each year, but since it took over the Princess Royal hospitals in Orpington and Bromley from the failing South London Hospital Trust (SLHT) in 2013 it has been battling escalating PFI debts and crippling agency staff bills.

The deficit would have been a staggering £114million last year were it not for a series of one-off payments for various services which the hospital received. These payments are not expected to be received this year.

King’s has already identified £50million of savings it can make this year by reducing the number of agency staff it employs and “re-negotiating contracts to get better value for money” but in order to make ends meet it is asking its staff “do you really need to fill a vacancy in your team?” as well as suggesting different teams share equipment. It’s now looking to identify £36m more in savings, in an effort to address its predicted £86m shortfall.

Helen Hayes, MP for Dulwich and West Norwood, said she was “extremely concerned” by the sheer scale of the cuts required which “could have a very serious impact on the services that the hospital is able to provide.  I would be particularly concerned to see any wards closed,” she said.

Ms Hayes is now calling on the government to write a cheque to King’s as she says the Trust was not given adequate financial support when it was invited to take over the Princess Royal after the SLHT went into administration.

“The current Tory government needs urgently to put in place a new viable financial settlement for the Trust that takes into account the real costs of running the Bromley and Orpington hospitals. It is vital that local patients at King’s College Hospital are not hit by closed wards, cut services and long waits to have diagnostic tests or see specialists,” she said. King’s has confirmed there are no current plans for staff redundancies or a general freeze on recruitment but acknowledged staff vacancies would not automatically be filled as they arose, but would instead be scrutinised to see if the post was “essential” before a decision to recruit or not was taken.

“As with many NHS organisations across the country, we have faced increased pressure on the Emergency Departments at our two acute hospitals. This, coupled with difficulties repatriating and discharging patients, has put additional pressure on our finances,” said a spokesperson from King’s, who added that nursing agency fees to fill vacancies at a heavily understaffed Princess Royal was also a large part of the problem. “Patient safety is our number one priority and we continue to recruit permanent staff to these positions,” they added.

The Unite union representative at the hospital, Frank Wood, said while he was pleased no redundancies had yet been proposed, the threat of further cuts “hangs over the staff like a dark cloud.”

“The government need to step in and write off this debt now as the lengthy delay only further undermines the ability of King’s staff to maintain a safe and high quality service,” he added.

In March health regulator Monitor launched a formal investigation into how the government could best support King’s after it took on the Princess Royal, which it said was clearly a “challenge much greater than originally anticipated.”

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