Shropshire emergency hospitals' deficit stretches to double the forecast

The Shrewsbury and Telford Hospital NHS Trust (SaTH) revealed at its annual general meeting this week that it ran at a £47.2million deficit for the financial year 2022/23.

The trust’s plan for the 2022/23 financial year was to deliver a deficit of £19.135 million in-year.

However, SaTH recorded a full year deficit of £47.206m – £28.07m over the forecasted deficit for the period.

The trust states that the deficit was in line with the revised forecast which was formally agreed with NHS England at the end of quarter three.

The planned underlying deficit for SaTH, after the removal of one-off income and expenditure items, was £32.6m and the actual underlying deficit was £34.4m – which the trust said was driven by inflation.

In its annual report SaTH said that the largest category of expenditure is pay which totals £411.1m, equating to 69 per cent of total operating expenditure.

Helen Troalen, director of finance at SATH, told the AGM that it has been a ‘really challenging year’ for the trust which ‘knew the risks in delivering that plan’.

She said that some of the extra costs involved were from patients remaining in hospital beds who no longer met the ‘criteria to reside’ after receiving the end of their care.

This demand for hospital beds resulted in the trust having to open ‘additional escalation areas’.

She said that the Future Fit Hospital Transformation Programme will reduce that problem.

Mrs Troalen added that during the 2022/23 financial year there was a surge in Covid-19 cases and SaTH was asked not to budget for the related costs.

During the last financial year the trust invested £57.3m in capital expenditure on medical equipment, digital infrastructure, improvements to existing buildings and expansion to their estate.

A total of £19.798m of the capital programme was funded through SaTH’s internally generated funds and the remainder was funded through the Public Dividend Capital.

Mrs Troalen added that the Dividend Capital was for NHS Trusts with a planned deficit – such as SATH – to allow them to continue to deliver a service.

“We received that last year and we continue to receive that,” said Mrs Troalen. “There is no guidance whether this is going to be repaid. Before the Covid-19 pandemic the Government wrote off these debts.”

SaTH added that it continues to be successful in applying for government capital programme projects which require application processes.

Mrs Troalen added that the trust had agreed a £45.5m deficit for this financial year.

“We have identified significant risks and this is an ambitious plan,” said Mrs Troalen. “We will be looking at recruiting more staff and reducing our reliance on agency staff.”

Louise Barnett, chief executive of the trust, said that they had experienced an ‘unprecedented demand’ on their services.

“Amid the ongoing impact of Covid-19 we are working at a significant financial deficit,” she added.

“We have been trying to make our hospitals a better place to be cared for with ward renovations. The world is a constantly changing place and we can’t stand still.”

Mrs Barnett added that they had reduced waiting times, restored elective orthopaedic services at the Princess Royal Hospital and brought in a surgical robot.

Liz Gardiner, from external auditor KPMG, told the meeting that her company did a value for money test against the trust’s accounts and found ‘no significant weaknesses’.