NHS received £1bn in bailouts

In six years, more than £1bn in bailout funds have been awarded to underperforming NHS trusts...

16:41 05 July 2012

In six years, more than £1bn in bailout funds have been awarded to underperforming NHS trusts it has been revealed.

The Department of Health gave emergency funds to four NHS foundation trusts and 17 NHS trusts between 2006 and 2012, the National Audit Office (NAO) has confirmed. 

The awarded funds went to pay creditors and staff as the units struggled to turn a profit. 

The news is timely given that one South London Healthcare NHS Trust recently became the first in the nation to fall under control of an administrator. The administrator was brought on to restore its finances which, in the last six years, have needed a total of £356 million. This figure has not yet been paid back, the NAO said.

Another London trust, Barking, Havering and Redbridge University Hospitals NHS Trust, was given £195 million.

In between the years of 2010 and 2011, troubled trusts had to be bailed out with £76 million. However, in the last year that figure balloon to £253 million, the NAO confirmed.

It wasn't just the big London based ones that fell into trouble either, with 34 trusts, including three primary care trusts, 10 NHS trusts and 21 NHS foundation trusts, all writing a deficit in 2011 and 2012.

At the current level, roughly £300m more in bailouts will most likely be granted in the coming year.

NAO head Amyas Morse said: "So far the NHS is meeting the challenge of maintaining strong finances in a period of austerity. It is clear, however, that parts of the service are under strain.

"For value for money to be delivered in future, two things are required: firstly, careful management of the risks created by transition to a new commissioning model; and, secondly, a coherent and transparent financial support mechanism which outlines when trusts should be supported, or allowed to fail."

In the 2011/12 year there was a surplus of £2.1 billion across the NHS as a whole.