28 April 2011
Medway NHS Foundation Trust has failed to meet its financial plans, putting it in ‘significant breach’ of its terms of authorisation.
Monitor, the independent regulator of NHS foundation trusts, said Medway was ‘failing to exercise its functions effectively, efficiently and economically’.
The regulator had specific concerns about scrutiny of financial planning and performance at board level, where it found an ‘historical lack of effectiveness’.
In a statement, the trust confirmed it had failed to meet its financial plans in 2010/11.
Monitor will not yet take any formal action against the trust but ‘specific milestones’ will be agreed.
Monitor chair David Bennett did not rule out formal intervention in the future, if the issues were not dealt with ‘quickly and effectively’. This could include requiring a board to take specific actions or, in extreme cases, removing any or all of the directors or governors and appointing replacements.
Bennett said: ‘We’ve taken this decision due to concerns about the level of board challenge on financial issues and about the trust’s plans to return to a stable financial footing.
‘Monitor will continue to work closely with the board at Medway NHS Foundation Trust to ensure that it takes the action necessary to make a sustainable return to full compliance and that it does so at an appropriate pace.’
In a statement responding to the report, Medway said it was ‘naturally disappointed’. It added that the 2010/11 financial plans included a savings target of £15m, which had been missed by almost 10%. The trust’s board had ensured that financial plans for the current financial year were more robust and would work closely with Monitor to return to compliance as soon as possible.
