Financial announcements

NHS Improvement places Trust in Financial Special Measures

31.10.16

Following the sudden and significant deterioration in the Trust’s reported financial position, announced in September 2016 the Trust’s regulator, NHS Improvement (NHSI), has concluded an investigation into the circumstances surrounding this unexpected decline.

As a result of this investigation, NHSI have concluded that there are grounds to conclude that the Trust is in breach of its provider license and furthermore as a consequence of the scale of variation from the Trust’s submitted financial plan, and associated oversight failings, that the criteria for placing the Trust in the Financial Special Measures regime have been triggered under the Strengthening Financial and Performance Accountability in 2016/17 framework published by the regulator earlier this year.  

The Trust is committed to working constructively with NHSI to address the shortcomings in financial governance and deliver financial turnaround safely and in as timely a fashion as possible (for more information read below).  The Trust also welcomes the opportunity to access enhanced skills and capacity available under the special measures regime.

Patients should be reassured that services will continue to run as normal.  Any patient who needs treatment at Cheltenham General Hospital, Gloucestershire Royal Hospital or Stroud Maternity Unit should continue to access services in the same way they have always done.

Change to financial position announced

20.09.16

Gloucestershire Hospitals NHS Foundation Trust has today (20 September 2016) announced a material change to its financial position. 

This follows a high level independent review of its financial position and financial reporting arrangements which was commissioned by the Board following concerns raised at a number of levels within the Trust about its financial position and the deterioration of its cash reserves (the money it has available to spend).

The review concluded that the Trust’s financial position isn’t as strong as previously understood and is significantly worse than the balanced position previously reported.

The review found that changes to some key financial planning assumptions has offset an underlying loss of financial control and a failure to fully deliver cost improvement plans.  The review also found the Trust had spent significantly more money developing and improving its equipment and buildings than it had available.

The Trust will not achieve its previously forecasted £5.3m surplus at the end of this financial year and although the exact amount is still to be confirmed, the Trust’s revised financial position is likely to be a material deficit. The position at the end of August shows a year to date deficit of £11.1m, which is £13.4m adverse of the Trust’s plan for August.

Deborah Lee, Chief Executive of the Trust and speaking on behalf of the Trust Board said:

“We deeply regret that the oversight of our finances wasn’t as strong as it should have been.  We have taken immediate steps to stabilise the Trust’s financial position, for example, we have reviewed our immediate capital spending priorities (spending on buildings and equipment) and arranged a loan through the Department of Health so we can access up to £20m to strengthen our immediate cash position.

“Patients should be reassured that our services continue to run as normal.  Any patients who need treatment at Cheltenham General Hospital, Gloucestershire Royal Hospital, Stroud Maternity Unit or Hereford Radiotherapy Unit should continue to access services in the same way they have always done.

“We are commissioning a full independent financial governance review to inform how we govern our finances going forward so this cannot happen again, and we will be putting a detailed action plan in place to bring our finances back on track. 

“I firmly believe excellent quality of care and good financial management go hand in hand and am determined as a Trust we will meet the challenges ahead in order to continue to provide high quality, sustainable services for our patients.

“We also welcome the support of our main commissioner, Gloucestershire Clinical Commissioning Group, and the national regulator, NHS Improvement, who we will work closely with to resolve this situation.” 

Below are answers to some of the questions you may have about this situation.  We will be adding more to this list as they are raised.  Please contact our communications team via comms@glos.nhs.uk if you have additional questions you would like answered.

Frequently Asked Questions

Q. Should I still attend hospital for my appointment/treatment/operation?

A. Yes, patients should continue to use our services and attend for treatment, appointments and operations as they do now.  We want to take this opportunity to reassure patients that all our services continue to run as normal.

Q.  As a result of the deteriorating financial position you describe will you be making cuts to services in the future?

A. We continue to provide services as we do now, but we will be looking to get back onto a firm financial footing too over the coming weeks and months.  However, high quality and financially sustainable services go hand in hand.  For example, having permanent nursing staff provides more consistent care and a better experience for patients and also reduces the cost of expensive agency staff; helping our patients recover well after operations and making sure they don’t get avoidable infections means they can go home sooner which is better care for them and more cost-effective for us.  Getting our care and treatment right first time, is better for patients and more cost effective for the Trust.

Q.  What will the impact of this be on patients and local people?

A. Our services continue as normal and our patients and local people should continue to use our services as they do today.

We have reviewed our immediate spending priorities and also arranged a loan from the Department of Health to strengthen our immediate cash position.  We firmly believe excellent quality of care and good financial health go hand in hand and are determined as a Trust we will meet the challenges ahead whilst continuing to provide high quality care for our patients.

Our aim continues to be to provide high quality services which are financially sustainable. 

Q.  How can you expect people to have trust and confidence in Gloucestershire Hospitals NHS Foundation Trust Board? Will there be resignations?

We can understand that people will be shocked to hear about the announcement we have made today and rightly will want to understand how the Trust’s reported financial position could have changed so significantly.  It would be wrong to comment before we receive the findings of the detailed independent review we are commissioning to establish:

  • How did it happen?
  • Why did it go un-noticed for so long?
  • Who was involved and how?

Every Board member deeply regrets this position.  We have taken decisive action to stabilise the Trust’s finances and to resolve this issue.  For example, we have secured a loan to strengthen our immediate cash position, and we have reviewed and prioritised our spending plans on buildings and equipment.

Our announcement today demonstrates how we are being open and transparent about a difficult situation; and we will continue to keep patients and local people updated on this situation, and the action we will be taking to get back to a firm financial footing, over the coming months.