news story

11th January 2007

Local MP "Shocked" at £100m Hospital Trust Debt

For more information, see my recent blog posts here and here.

Northavon MP Steve Webb has expressed his shock at a £100 million debt amassed by the North Bristol NHS Trust, which he fears could lead to frontline health cuts.

The debt is the main reason that the trust - which manages Southmead and Frenchay hospitals - was recently refused foundation status. It owes the Department of Health £100 million after taxpayers' money was used to bail it out of a cash crisis four years ago.

The size of the debt only came to light after Mr Webb obtained a letter sent to the trust by a Whitehall official explaining why a recent application for foundation status had been rejected.   The letter said that the South West Strategic Health Authority (SHA) had refused to support the trust's application for greater financial freedom. It said the SHA was concerned that on top of owing £100 million, the trust was also preparing to take on more debt to finance the building of the new Southmead super-hospital.

Commenting, Steve Webb said:

"I am shocked at the level of debt, which raises the real prospect that health chiefs will be forced to make cuts to frontline care in order to claw back some of the deficit. Hospitals across the country with far smaller debts are delaying operations and closing wards to save money."

The debt dates back to two years of soaring deficits in 2001/02 and 2002/03, which led to the trust being £52 million in the red by March 2003. Under a financial recovery plan, the trust received bail-out money worth £48 million from the NHS Bank between 2003/04 and 2005/06.