03 December 2004
Bradford Teaching Hospitals Foundation Trust has asked its regulator for 'time and space' to implement its financial recovery plan after its overspend was projected at more than £11m.
The regulator, Monitor, used its powers of intervention for the first time in October, when it ordered the trust to recover a deficit projected to reach £4m by the end of this financial year. The bodies also jointly appointed external advisers to report on the financial difficulties and work on a recovery plan.
The boards of the trust and Monitor met on November 30, to hear the trust's proposals. Earlier in the week, it was revealed that the projected £4m overspend was conservative and the actual figure could be £11.3m.
The regulator is unhappy because the trust's budgeted surplus of £2.3m formed the basis for its approval of the trust's foundation application. It said: 'The trust was aware of its developing financial problems in early April 2004, following authorisation on April 1, but these problems came to the attention of Monitor only in August as a result of its first quarterly monitoring of the financial position of authorised foundation trusts.'
The board has admitted to Monitor that its initial response to these problems was insufficient.'
Consultants Alvarez and Marsal recommended that the trust should concentrate on its turnaround plan, develop processes to resolve differences with its primary care trusts and strengthen its financial systems. It should also develop the skills of its board and plan in order to survive under Payment by Results.
'We had the opportunity to present our plans for recovering our financial position and it is encouraging that this work is already showing significant success,' a trust spokeswoman said. 'We hope to build on this platform and that Monitor will give us the time and space to do so.'
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