The two main stories that I want to discuss are not about health but about money. It was announced this week that the South London Healthcare Trust is on its financial knees with unsustainable debt and no means of reversing of £69m in deficit on an annual turnover of £424m. As money and quality are so often linked, the hospital is also performing badly on key indicators such as waiting times for surgery and accident and emergency treatment. The Trust cites the heavy burden of an existing PFI (Private Finance Initiative) arrangement which funded previous building works and the debt repayments account for 14% of the Trusts’ income.
Andrew Lansley, Secretary of State for Health, is now likely to take the unprecedented step of appointing an administrator to sort out the financial mess, with the unenviable challenge of maintaining acceptable quality of care in the process.
This Hospital Trust is not alone – with an estimated 20 more Trusts facing economic meltdown. The news isn’t even a surprise as warnings of unsustainable balance sheets were flagged at least 12 months ago.
This must now be a priority for the government to sort. What a pity more attention wasn’t paid to the coffers of the major healthcare institutions while Lansley’s Health and Social Care Bill fiddled and tweaked with the niceties of power shifts, administration reshuffles and a blatant disregard for the deal-breaking issues. Like making sure that Hospital Trusts can actually afford to deliver treatment and care to the local community they serve.
As I have quoted my wise old Dad in the past – ‘stop putting good money after bad’. The legacy of financial burden from badly designed PFI’s and crippling interest rates must be addressed, the slate cleared and Trusts given a chance to function at the appropriate level of quality within budget. The benchmark should be simple – these trusts must be financially and clinically viable to continue to receive NHS funding and where a Trust can demonstrate that it’s worth saving, the powers that be should step in to provide fiscal support.
The other news story? Barclays Bank has been fined £291 million for illegally manipulating bank lending rates. Several other banks are currently being investigated for this cynical behaviour and hopefully further mega-fines will be collected. Talking of banks – the word ‘bailout’ springs to mind and it is frankly shocking and disappointing to the extreme that these institutions should continue to operate on the edges of morality and legality. But while we are talking bailout – what better way of spending some newly found capital?
I can think of several worthy recipients of a share of that £291million windfall - maybe the South London Hospital Trust should be one of them?